Business Context and Reporting Period
Company: Fidelity National Information Services, Inc. (FIS)
Filing Type: Form 8-K (Current Report)
Date of Report: September 1, 2015
Event: Entry into a Material Definitive Agreement (Term Loan Credit Agreement) to facilitate the acquisition of SunGard, Inc.
Key Financial Metrics and Debt Structure
This filing details a new debt facility rather than reporting operational financial results (revenue, profit, or cash flow) for a specific period.
- Facility Size: $1.50 billion committed term facility.
- Currency: U.S. Dollars.
- Maturity: Three years from the Initial Funding Date.
- Security Status: Unsecured.
- Interest Rate: Floating rate (Eurocurrency rate or Base rate plus applicable margin and mandatory costs).
- Principal Repayment: No payments due until the Maturity Date.
- Prepayment: Voluntary prepayments permitted without fee (subject to breakage costs for eurocurrency periods); no mandatory prepayment.
Material Changes and Transaction Purpose
The primary material change is the execution of the Term Loan Credit Agreement on September 1, 2015. The proceeds are designated for:
- Funding part of the consideration for the acquisition of SunGard (the "SunGard Acquisition").
- Paying costs and expenses related to the transaction.
- General corporate purposes.
- Repayment of outstanding SunGard Notes (if applicable) via an optional additional drawing on the Final Funding Date.
Guaranty: A springing guaranty by the issuer of the SunGard Notes may become effective 90 days after the SunGard Closing Date if those notes remain outstanding.
Covenants, Risks, and Management Commentary
Covenants: The agreement includes standard affirmative, negative, and financial covenants, including:
- Limits on creation of liens and subsidiary indebtedness.
- Restrictions on investments, dispositions, dividends, and other restricted payments.
- Minimum interest coverage ratio.
- Maximum leverage ratio.
Events of Default: Include failure to pay principal/interest and breach of covenants, which may allow the Administrative Agent to accelerate loan maturity.
Regulatory Status: FIS intends to file a Registration Statement on Form S-4 containing a consent solicitation statement for SunGard stockholders. The filing explicitly states that the consent solicitation statement/prospectus is not yet available.
Investor Verification Checklist
- Verify the final closing date of the SunGard Acquisition to determine the Initial Funding Date.
- Confirm the specific credit rating of FIS to determine the applicable interest margin.
- Review the upcoming Form S-4 filing for details on the SunGard consent solicitation and transaction terms.
- Monitor the status of SunGard Notes to determine if the springing guaranty provision will be triggered.
- Examine the full text of the Term Loan Credit Agreement (Exhibit 10.1) for detailed covenant thresholds.