Stockholders' Equity

12 Months Ended

Sep. 30, 2012

Stockholders' Equity Note [Abstract]

Stockholders' Equity

Note 15—Stockholders' Equity

The number of shares of each class and the number of shares of class A common stock on an as-converted basis at September 30, 2012, are as follows:

(in millions except conversion rate)	Shares Outstanding	Conversion Rate Into Class A Common Stock	As-converted Class A Common Stock (1)
Class A common stock	535	—	535
Class B common stock	245	0.4206	103
Class C common stock	31	1.0000	31
Total			668

⁽¹⁾  Figures may not sum due to rounding. As-converted class A common stock count is calculated based on whole numbers.

Reduction in as-converted shares. During fiscal 2012, total as-converted class A common stock was reduced by 22.8 million shares, using $2.4 billion of operating cash on hand. Of the $2.4 billion, $710 million was used to repurchase class A common stock in the open market. In addition, the Company made deposits totaling $1.7 billionof operating cash into the litigation escrow account previously established under the retrospective responsibility plan. These deposits have the same economic effect on earnings per share as repurchasing the Company's class A common stock, because they reduce the class B conversion rate and consequently the as-converted class A common stock share count.

In July 2012, the Company's board of directors authorized a $1 billion share repurchase program to be in effect through July 2013. As of September 30, 2012, the program had remaining authorized funds of $865 million. In October 2012, the Company's board of directors authorized an additional $1.5 billion share repurchase program to be in effect through October 2013. All share repurchase programs authorized prior to July 2012 have been completed.

The following table presents share repurchases in the open market during the following fiscal years:

(in millions, except per share data)	2012		2011
Shares repurchased in the open market (1)	6.2		26.6
Weighted-average repurchase price per share	$	114.87	$	76.08
Total cost	$	710	$	2,024

⁽¹⁾  All shares repurchased in the open market have been retired and constitute authorized but unissued shares.

Under the terms of the retrospective responsibility plan, when the Company makes a deposit into the litigation escrow account, the shares of class B common stock are subject to dilution through an adjustment to the conversion rate of the shares of class B common stock to shares of class A common stock.

The following table presents as-converted class B common stock after deposits into the litigation escrow account:

	Fiscal 2012				Fiscal 2011
(in millions, except per share and conversion data)	July 2012		December 2011		March 2011		October 2010
Deposits under the retrospective responsibility plan	$	150	$	1,565	$	400	$	800
Effective price per share(1)	$	125.50	$	101.75	$	73.81	$	72.74
Reduction in equivalent number of shares of class A common stock	1.2		15.4		5.4		11.0
Conversion rate of class B common stock to class A common stock after deposits	0.4206		0.4254		0.4881		0.5102
As-converted class B common stock after deposits	103		104		120		125

⁽¹⁾  Effective price per share calculated using the volume-weighted average price of the Company's class A common stock over a pricing period in accordance with the Company's amended and restated certificate of incorporation.

Class B Common Stock. The class B common stock is not convertible or transferable until the date on which all of the covered litigation has been finally resolved. This transfer restriction is subject to limited exceptions, including transfers to other holders of class B common stock. After termination of the restrictions, the class B common stock will be convertible into class A common stock if transferred to a person that was not a Visa member or similar person or affiliate of a Visa member or similar person. Upon such transfer, each share of class B common stock will automatically convert into a number of shares of class A common stock based upon the applicable conversion rate in effect at the time of such transfer.

Adjustment of the conversion rate occurs upon: (i) the completion of any follow-on offering of class A common stock completed to increase the size of the litigation escrow account (or any cash deposit by the Company in lieu thereof) resulting in a further corresponding decrease in the conversion rate; or (ii) the final resolution of the covered litigation and the release of funds remaining on deposit in the litigation escrow account to the Company resulting in a corresponding increase in the conversion rate.

Class C Common Stock. As of September 30, 2012, all of the shares of class C common stock have been released from transfer restrictions, and 121 million shares have been converted from class C to class A common stock upon their sale into the public market.

Preferred Stock. Preferred stock may be issued as redeemable or non-redeemable, and it has preference over any class of common stock with respect to the payment of dividends and distribution of the Company’s assets in the event of a liquidation or dissolution. The Company had no shares of preferred stock outstanding during and at the end of fiscal 2012, 2011 and 2010.

Voting Rights. The holders of class A common stock have the right to vote on all matters on which stockholders generally are entitled to vote. All holders of class B and class C common stock have no right to vote on any matters, except for certain defined matters, including any consolidation, merger, combination or any decision to exit the core payments business, in which case the holders of class B and class C common stock are entitled to cast a number of votes equal to the number of shares of class B or class C common stock held multiplied by the applicable conversion rate in effect on the record date.

Dividends Declared. On October 24, 2012, the Company’s board of directors declared a quarterly cash dividend of $0.33 per share of class A common stock (determined in the case of class B and class C common stock on an as-converted basis), which will be paid on December 4, 2012, to all holders of record of the Company’s class A, class B and class C common stock as of November 16, 2012. The Company declared and paid $595 million in dividends in fiscal 2012 at a quarterly rate of $0.22 per share.