Summary
Visa Inc. (V) has filed an 8-K report detailing a significant event related to its Series B and Series C Convertible Participating Preferred Stock. This filing announces the release of approximately $3.5 billion from these preferred stock series, stemming from a mandatory release assessment related to the Visa Europe acquisition. This release is part of a pre-determined process outlined in the Litigation Management Deed to assess and adjust the preferred stock based on ongoing litigation risks concerning multilateral interchange fee rates in the Visa Europe territory. The downward adjustment impacts the Class A Common Equivalent Number for both Series B and Series C preferred stock, leading to a partial conversion into Series A Convertible Participating Preferred Stock. Investors should note that this event, effective July 29, 2022, will result in the issuance of approximately 176,853 shares of Series A Preferred Stock to existing preferred stockholders. Each share of Series A Preferred Stock will then automatically convert into 100 shares of Class A Common Stock upon sale to an eligible holder. While this event signifies a reduction in the liability coverage associated with the preferred stock and a move towards common stock, it is a procedural step based on the terms established during the Visa Europe acquisition and is being conducted in reliance on securities registration exemptions.
Key Highlights
- 1Visa Inc. is releasing approximately $3.5 billion from its Series B and Series C Convertible Participating Preferred Stock.
- 2The release is due to the second mandatory release assessment on June 21, 2022, related to the Visa Europe acquisition and associated litigation risks.
- 3This action involves a downward adjustment to the Class A Common Equivalent Number for both Series B and Series C Preferred Stock.
- 4Approximately 176,853 shares of Series A Convertible Participating Preferred Stock will be issued to existing preferred stockholders effective July 29, 2022.
- 5Each share of Series A Preferred Stock will automatically convert into 100 shares of Class A Common Stock upon sale to an eligible holder.
- 6The adjustments and conversions are executed in accordance with the terms set forth in the Certificates of Designations for the preferred stock.
- 7The issuance of Series A Preferred Stock and subsequent common stock is being made under an exemption from registration requirements (Section 3(a)(9) of the Securities Act of 1933).