Visa 2007 Annual Report Download - page 104

Table of Contents
Class or Series Par Value To Be Authorized
To Be Issued
in the Proposed
Reorganization
Class C (series III) $ 0.0001 64,000,000
Class C (series IV) $ 0.0001 1,000,000
Regional classes and series of common stock
Class USA $ 0.0001 622,245,209 426,390,481
Class EU (series I) $ 0.0001 64,000,000 62,213,201
Class EU (series II) $ 0.0001 38,582,801 27,904,464
Class EU (series III) $ 0.0001 1,000,000 549,587
Class Canada $ 0.0001 25,000,000 22,034,685
Class AP $ 0.0001 130,000,000 119,100,481
Class LAC $ 0.0001 90,000,000 80,137,915
Class CEMEA $ 0.0001 42,000,000 36,749,698
2,004,199,484,030 775,080,512
In order to reflect relative actual performance, the initial allocation of the Company's regional classes and series of common stock is subject to
subsequent conversion and reallocation, which is referred to as the true-up, based on each participating region's relative under- or over-achievement of its net
revenue targets during a measurement period, consisting of the four-quarter period ending with (and including) the latest quarter for which financial
statements are included in a registration statement in connection with an initial public offering of the Company's class A common stock on the date it is
declared effective by the SEC. As a result of the true-up, each of the regional classes and series of common stock will be converted into class C common stock
or, in the case of the class USA common stock, class B common stock prior to an initial public offering of the Company's class A common stock. The shares
held by Visa Europe are not subject to true-up.
The stock set forth above is also subject to various redemption and conversion provisions, all of which are contingent upon an initial public offering of
the Company, among other things.
Put-Call Option Agreement on Visa Europe Shares
As part of the GRA, the Company agreed to enter into a put-call option agreement with Visa Europe. Under this agreement, the Company will grant
Visa Europe a put option under which the Company is obligated to purchase from the members of Visa Europe all of the share capital of Visa Europe at any
time following the first anniversary of a successful completion of an initial public offering or 605 days after the closing date of the reorganization, which is
May 28, 2009. Upon exercise of the put option, the Company will be required to repurchase the shares of Visa Europe no later than 285 days after such
exercise.
Further, under the call option, the Company will be entitled to purchase all of the share capital of Visa Europe from its members at any time following
certain triggering dates. A triggering event will occur if: (A) there is a 25% or greater decline in the number of merchants and a 45% or greater decline in the
number of automated teller machines in Visa Europe's region that accept Visa branded products; (B) such rate of decline in each case is at least twice as much
as both: (i) the average rate of decline in the number of merchants and ATMs in the Visa Europe region that accept general payment cards and (ii) the average
rate of decline in acceptance, if any, in the number of merchants and ATMs outside of Visa Europe's region that accept Visa branded cards; and (C) Visa
Europe has failed to deliver and implement a remediation plan within six months of the occurrence of such events.
The price per share at which both the call and put option are exercisable is calculated using a formula principally based on Visa Europe's projected
financial performance, identified synergies expected to be realized upon combination of the entities and the Company's price-to-earnings ratio.
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