Visa 2013 Annual Report Download - page 100

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VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2013
covenants and events of default customary for facilities of this type. The participating lenders in the new
credit facility include affiliates of certain holders of the Company’s class B and class C common stock and
some of the Company’s clients or affiliates of its clients. The new credit facility is maintained to provide
liquidity in the event of settlement failures by the Company’s clients, to back up the commercial paper
program and for general corporate purposes.
Interest on borrowings under the Credit Facility would be charged at the London Interbank Offered
Rate (“LIBOR”) or an alternative base rate, in each case plus applicable margins that fluctuate based on the
applicable credit rating of the Company’s senior unsecured long-term debt. Visa also agreed to pay a
commitment fee that fluctuates based on the credit rating of the Company’s senior unsecured long-term
debt. Currently, the applicable margin is 0.00% to 0.75% depending on the type of the loan, and the
commitment fee is 0.05%. There were no borrowings under this facility and the Company was in
compliance with all related covenants at September 30, 2013.
Note 10—Pension, Postretirement and Other Benefits
The Company sponsors various qualified and non-qualified defined benefit pension and other
postretirement benefit plans that 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 other postretirement benefit plans.
Defined benefit pension plans. The defined benefit pension plan benefits are based on years of
service, age and eligible compensation. Prior to January 1, 2011, employees hired before January 1,
2008 earned benefits based on their pay during their last five years of employment. Employees hired or
rehired on or after January 1, 2008, earned benefits based on a cash balance formula. Effective
January 1, 2011, all employees began accruing benefits under the cash balance formula and ceased
accruing 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.
Postretirement benefits plan. The postretirement benefits plan provides medical benefits for
retirees and dependents who meet minimum age and service requirements. Benefits are provided from
retirement date until age 65. Retirees must contribute on a monthly basis for the same coverage that is
generally available to active employees and their dependents. The Company’s contributions are
funded on a current basis.
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