Visa 2010 Annual Report Download - page 101

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2010
(in millions, except as noted)
U.S. Commercial Paper Program
Visa International maintains a U.S. commercial paper program to support its working capital requirements and for general corporate purposes. This
program allows the Company to issue up to $500 million of unsecured debt securities, with maturities up to 270 days from the date of issuance and at interest
rates generally extended to companies with comparable credit ratings. The Company had no outstanding obligations under this program during and at the end
of fiscal 2010 and 2009.
Revolving Credit Facilities
In 2008, Visa Inc. entered into a $3.0 billion five-year revolving credit facility (the "February 2008 Agreement"). The February 2008 Agreement
matures on February 15, 2013 and contains covenants and events of defaults customary for facilities of this type. The participating lenders in this revolving
credit facility include affiliates of certain holders of the Company's class B and class C common stock, and certain of the Company's clients or affiliates of its
clients. This revolving credit facility is maintained to provide liquidity in the 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 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. The Company also agrees 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 the Company's credit rating. Currently, the applicable margin is 0.15%, the facility fee is 0.05% and the utilization fee
is 0.05%.
There were no borrowings under the revolving credit facility and the Company was in compliance with all related covenants during and at the end of
fiscal 2010 and fiscal 2009.
Note 12—Pension, Postretirement and Other Benefits
The Company sponsors various qualified and non-qualified defined benefit pension and postretirement benefit plans which provide for retirement and
medical benefits for substantially all employees residing in the United States. The Company uses a September 30 measurement date for its pension and
postretirement benefit plans.
Defined Benefit Pension Plan
The defined benefit pension plan benefits are based on years of 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 will accrue benefits under the cash balance formula and will cease to accrue 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 is to contribute annually no less than the minimum required contribution under ERISA.
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