Visa 2011 Annual Report Download - page 59

Table of Contents
In the ordinary course of business, we enter into contractual arrangements with financial institutions and other clients under which we may agree to
indemnify the client for certain types of losses incurred relating to the services we provide or otherwise relating to our performance under the applicable
agreement.
Contractual Obligations
Our contractual commitments will have an impact on our future liquidity. The contractual obligations identified in the table below include both on- and
off-balance sheet transactions that represent a material expected or contractually committed future obligation at September 30, 2011. We believe that we will
be able to fund these obligations through cash generated from our operations and available credit facilities. See Note 2—Visa Europe, Note 11—Pension,
Postretirement and Other Benefits, Note 18—Commitments and Contingencies, and Note 21—Legal Matters to our consolidated financial statements.
Payments Due by Period
Less than
1 Year
1-3
Years
3-5
Years
More than
5 Years Total
(in millions)
Purchase orders(1) $ 810 $ 167 $ 18 $ — $ 995
Leases(2) 71 85 29 34 219
Client incentives(3) 1,795 2,558 1,439 566 6,358
Marketing and sponsorships(4) 119 214 94 86 513
Litigation settlement payments 140 — — — 140
Dividends(5) 151 — — — 151
Total(6, 7, 8) $ 3,086 $ 3,024 $ 1,580 $ 686 $ 8,376
(1) Represents agreements to purchase goods and services that specify significant terms, including: fixed or minimum quantities to be purchased and fixed,
minimum or variable price provisions, and the approximate timing of the transaction.
(2) Includes both operating and capital leases. Visa leases certain premises, equipment and software licenses under leases with varying expiration dates.
(3) Represents future cash payments for client incentive agreements with select clients under various programs designed 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 support based on
specific performance requirements. Payments under these agreements will be offset by revenues earned from higher corresponding payments and
transaction volumes. These payment amounts are estimates and will change based on customer performance, execution of new contracts, or
amendments to existing contracts. Related amounts disclosed in Note 18—Commitments and Contingencies to our consolidated financial statements
represent the associated expected future reduction of revenues related to these agreements.
(4) Visa is a party to contractual sponsorship agreements ranging from approximately two to sixteen years. These contracts are designed to help increase
Visa-branded cards and volumes. Over the life of these contracts, Visa is required to make payments in exchange for certain advertising and
promotional rights. In connection with these contractual commitments, Visa has an obligation to spend certain minimum amounts for advertising and
marketing promotion over the contract terms. For obligations where the individual years of spend are not specified in the contract, we have estimated
the timing of when these amounts will be spent.
(5) Includes dividend amount of $151 million as dividends were declared on October 18, 2011 and will be paid on December 6, 2011 to all holders of
record of Visa's common stock as of November 18, 2011.
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