Visa 2008 Annual Report Download - page 81

Table of Contents
Revolving credit facilities. On February 15, 2008, we entered into a $3.0 billion five-year revolving credit facility with a syndicate of banks including
affiliates of certain class B and class C stockholders and certain of our customers or affiliates of our customers. 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% or the Bank of America prime
rate; (2) Eurocurrency Advance, which will bear interest at a rate equal to LIBOR (as adjusted for applicable reserve requirements) plus an applicable cost
adjustment and an applicable margin of 0.11% to 0.30% based on our credit rating; or (3) U.S. Swing Loan, Euro Swing Loan, or Foreign Currency Swing
Loan, which will bear interest at the rate equal to the applicable Swing Loan rate for that currency plus the same applicable margin plus additionally for Euro
and Sterling loans, an applicable reserve requirement and cost adjustment. We also agreed to pay a facility fee on the aggregate commitment amount, whether
used or unused, at a rate ranging from 0.04% to 0.10% and a utilization fee on loans at a rate ranging from 0.05% to 0.10% based on our credit rating.
Currently, the applicable margin is 0.15%, the facility fee is 0.05% and the utilization fee is 0.05%. This facility contains certain covenants, including
financial 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 have been no borrowings under this facility. At September 30, 2008, we were in compliance with all covenants with
respect to this facility.
U.S. commercial paper programs. 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. At September 30, 2008, we had no
obligations outstanding under this program. There are no financial covenants related to this program.
Medium-term note program. Visa International has established a medium-term note program authorizing the issuance of a maximum of $250 million of
unsecured, private placement notes. The notes may be issued with maturities from nine months to 30 years at fixed or floating interest rates. At September 30,
2008, we had notes outstanding in an aggregate amount of $40 million, which mature in August 2009 and have a fixed interest rate of 7.53%. Interest expense
on the outstanding notes for fiscal 2008 was approximately $3 million. There are no financial covenants related to this program.
Credit Ratings
At September 30, 2008, Standard and Poor's and Moody's rated our long-term and short-term unsecured debt as follows:
Standard and Poor's Moody's
Debt type Rating Outlook Rating Outlook
Long-term unsecured debt
Local A+ Stable A1 Stable
Foreign A+ Stable A1 Stable
Short-term unsecured debt A-1 Stable P-1 Stable
Factors that can affect our credit ratings include 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.
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