Stockholders’ Equity

Classes of Capital Stock

Mastercard’s amended and restated certificate of incorporation authorizes the following classes of capital stock:



Class	Par Value Per Share	Authorized Shares (in millions)	Dividend and Voting Rights
A	$0.0001	3,000	One vote per share Dividend rights
B	$0.0001	1,200	Non-voting Dividend rights
Preferred	$0.0001	300	No shares issued or outstanding at December 31, 2018 and 2017, respectively. Dividend and voting rights are to be determined by the Board of Directors of the Company upon issuance.

Ownership and Governance Structure

Equity ownership and voting power of the Company’s shares were allocated as follows as of December 31:



	2018				2017
	Equity Ownership		General Voting Power		Equity Ownership		General Voting Power
Public Investors (Class A stockholders)	88.0	%	89.0	%	88.0	%	89.2	%
Principal or Affiliate Customers (Class B stockholders)	1.1	%	—	%	1.4	%	—	%
Mastercard Foundation (Class A stockholders)	10.9	%	11.0	%	10.6	%	10.8	%

Class B Common Stock Conversions

Shares of Class B common stock are convertible on a one-for-one basis into shares of Class A common stock. Entities eligible to hold Mastercard’s Class B common stock are defined in the Company’s amended and restated certificate of incorporation (generally the Company’s principal or affiliate customers), and they are restricted from retaining ownership of shares of Class A common stock. Class B stockholders are required to subsequently sell or otherwise transfer any shares of Class A common stock received pursuant to such a conversion.

Mastercard Foundation

In connection and simultaneously with its 2006 initial public offering (the “IPO”), the Company issued and donated 135 million newly authorized shares of Class A common stock to Mastercard Foundation. Mastercard Foundation is a private charitable foundation incorporated in Canada that is controlled by directors who are independent of the Company and its principal customers. Under the terms of the donation, Mastercard Foundation became able to resell the donated shares in May 2010 to the extent necessary to meet charitable disbursement requirements dictated by Canadian tax law. Under Canadian tax law, Mastercard Foundation is generally required to disburse at least 3.5% of its assets not used in administration each year for qualified charitable disbursements. However, Mastercard Foundation obtained permission from the Canadian tax authorities to defer the giving requirements until 2021. Mastercard Foundation, at its discretion, may decide to meet its disbursement obligations on an annual basis or to settle previously accumulated obligations during any given year. Mastercard Foundation will be permitted to sell all of its remaining shares beginning May 1, 2027, subject to certain conditions.

Stock Repurchase Programs

The Company’s Board of Directors have approved share repurchase programs authorizing the Company to repurchase shares of its Class A Common Stock. These programs become effective after the completion of the previously authorized share repurchase program.

The following table summarizes the Company’s share repurchase authorizations of its Class A common stock through December 31, 2018, as well as historical purchases:




Board authorization dates	December 2018		December 2017		December 2016		December 2015		December 2014

Date program became effective	January 2019		March 2018		April 2017		February 2016		January 2015		Total
	(in millions, except average price data)
Board authorization	$	6,500	$	4,000	$	4,000	$	4,000	$	3,750	$	22,250
Dollar-value of shares repurchased in 2016	$	—	$	—	$	—	$	3,004	$	507	$	3,511
Remaining authorization at December 31, 2016	$	—	$	—	$	4,000	$	996	$	—	$	4,996
Dollar-value of shares repurchased in 2017	$	—	$	—	$	2,766	$	996	$	—	$	3,762
Remaining authorization at December 31, 2017	$	—	$	4,000	$	1,234	$	—	$	—	$	5,234
Dollar-value of shares repurchased in 2018	$	—	$	3,699	$	1,234	$	—	$	—	$	4,933
Remaining authorization at December 31, 2018	$	6,500	$	301	$	—	$	—	$	—	$	6,801

Shares repurchased in 2016	—		—		—		31.2		5.7		36.9
Average price paid per share in 2016	$	—	$	—	$	—	$	96.15	$	89.76	$	95.18
Shares repurchased in 2017	—		—		21.0		9.1		—		30.1
Average price paid per share in 2017	$	—	$	—	$	131.97	$	109.16	$	—	$	125.05
Shares repurchased in 2018	—		19.0		7.2		—		—		26.2
Average price paid per share in 2018	$	—	$	194.77	$	171.11	$	—	$	—	$	188.26
Cumulative shares repurchased through December 31, 2018	—		19.0		28.2		40.4		40.8		128.4
Cumulative average price paid per share	$	—	$	194.77	$	141.99	$	99.10	$	92.03	$	120.44

The following table presents the changes in the Company’s outstanding Class A and Class B common stock for the years ended December 31:



	Outstanding Shares
	Class A		Class B
	(in millions)
Balance at December 31, 2015	1,095.0		21.3
Purchases of treasury stock	(36.9	)	—
Share-based payments	2.3		—
Conversion of Class B to Class A common stock	2.0		(2.0	)
Balance at December 31, 2016	1,062.4		19.3
Purchases of treasury stock	(30.1	)	—
Share-based payments	2.2		—
Conversion of Class B to Class A common stock	5.2		(5.2	)
Balance at December 31, 2017	1,039.7		14.1
Purchases of treasury stock	(26.2	)	—
Share-based payments	2.8		—
Conversion of Class B to Class A common stock	2.3		(2.3	)
Balance at December 31, 2018	1,018.6		11.8