Visa 2010 Annual Report Download - page 35

Table of Contents
Acquisitions or strategic investments could disrupt our business and harm our financial condition and results of operations.
Although we may continue to make strategic acquisitions or investments in complementary businesses, products or technologies, we may be unable to
successfully finance, partner with or integrate them. The integration of the recently acquired CyberSource Corporation will take time and resources that would
otherwise have been available for other acquisitions. We will be subject to the terms of the exclusive license granted to Visa Europe in most acquisitions and
major investments that involve countries in the Visa Europe territory. Regulatory constraints, particularly competition regulations, may affect the extent to
which we can maximize the value of acquisitions or investments.
Furthermore, the integration of any acquisition or investment may divert management's time and resources from our core business and disrupt our
operations. We may spend time and money on projects that do not increase our revenues. Moreover, our cash reserves contract to the extent we pay the
purchase price of any acquisition or investment in cash. Although we periodically evaluate potential acquisitions of and investments in businesses, products
and technologies, and anticipate continuing to make these evaluations, we cannot guarantee that we will be able to execute and integrate any such acquisitions
and investments.
Future sales of our class A common stock, or the expiration or waiver of transfer restrictions on our class B and C common stock, could result in
dilution to holders of shares of our existing class A common stock, adversely affecting their rights and depressing the market price of our class A
common stock.
The market price and voting power of our class A common stock could decline because of increases in the number of such shares outstanding. The
market price of our class A common stock may also suffer from the perception that such an increase could occur, such as upon the issuance or conversion of
securities convertible to shares of our class A common stock. Specifically, on March 25, 2011, all of our restricted shares of class C common stock will
become transferable at once.
If funds are released from escrow after the resolution of the litigation covered by our retrospective responsibility plan, the value of our class A
common stock will be diluted.
Under our retrospective responsibility plan, funds still in the escrow account after the resolution of all covered litigation will be released back to us. At
that time, each share of class B common stock will become convertible into an increased number of shares of class A common stock, benefitting the holders
of class B common stock. This in turn will result in dilution of the interest in Visa Inc. held by the holders of class A common stock. The amount of this
dilution will depend on the amount, if any, of the funds released from the escrow account and the market price of our class A common stock near the time the
funds are released.
Shares of Class A common stock acquired by Visa members and certain affiliates and competitors convert automatically into shares of class C
common stock, which have limited voting rights and may be subject to restrictions on transfer.
Shares of class A common stock acquired by a Visa member, an affiliate of a Visa member or any person that is a competitor or its affiliate, in each
case to the extent acting as a principal investor, convert automatically into shares of class C common stock. Some shares of class C common stock cannot be
transferred until March 25, 2011. In addition, holders of shares of our class C common stock do not have the right to vote on certain matters, including the
election of directors.
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