FIS

Business Context and Reporting Period

Company: Fidelity National Information Services, Inc. (FIS)
Filing Type: Form 8-K (Current Report)
Reporting Date: July 20, 2010 (Earliest event reported: July 16, 2010)
Context: The filing reports the completion of significant debt financing activities, including the issuance of senior notes and the closing of term loans, intended to fund share repurchases and repay prior acquisition-related debt.

Key Financial Metrics and Capital Structure

Debt Issuance:

• 7.625% Senior Notes due 2017: $600 million aggregate principal amount.
• 7.875% Senior Notes due 2020: $500 million aggregate principal amount.
• Term B Loans: $1.5 billion aggregate principal amount.

Interest Terms:

• 2017 Notes: 7.625% per annum, payable semi-annually.
• 2020 Notes: 7.875% per annum, payable semi-annually.
• Term B Loans: Eurocurrency Rate (floor 1.50%) + 3.75% margin; or Base Rate (floor 1.00% above greater of 1.50% or 1-month Eurocurrency Rate) + 2.75% margin.

Repayment Schedule:

• Notes: Principal due at maturity (2017 and 2020).
• Term B Loans: Quarterly principal payments of 0.25% of original balance starting December 31, 2010; final maturity July 18, 2016.

Use of Proceeds:

• Repurchase of common stock.
• Repayment and termination of the credit facility assumed in the Metavante Technologies, Inc. acquisition.
• Payment of fees and expenses.

Liquidity and Cash Flow: The filing text does not provide specific values for current cash balances, operating cash flow, or liquidity ratios. It confirms that proceeds from these financings satisfied the financing condition for a pending share repurchase tender offer.

Material Changes Versus Prior Period

This filing represents a material change in the company's capital structure through the addition of $2.6 billion in new debt obligations ($1.1 billion in notes and $1.5 billion in term loans). This activity supersedes the prior credit facility assumed during the Metavante acquisition, which is scheduled for full repayment and termination using the new proceeds.

Guidance, Outlook, Risks, and Contingencies

Management Commentary and Outlook:

• FIS intends to use the new capital to execute a share repurchase program and deleverage by retiring the Metavante acquisition debt.
• The company has satisfied the financing condition for its tender offer dated July 6, 2010.

Risks and Covenants:

• Indenture Covenants: The notes indenture limits the ability to incur additional indebtedness, make restricted payments, create liens, restrict dividend payments from subsidiaries, engage in sale-leaseback transactions, transfer assets, or engage in affiliate transactions.
• Redemption: Notes may be redeemed prior to July 15, 2013 (2017 Notes) and July 15, 2014 (2020 Notes) with a "make-whole" premium. Up to 35% of either series may be redeemed with equity offering proceeds before these dates.
• Change of Control/Asset Sales: FIS is obligated to offer to repurchase notes at 101% of principal (plus interest) upon certain change of control events, and at 100% (plus interest) upon certain asset sales.
• Registration Rights: FIS must file an exchange offer registration statement within 270 days and complete the exchange within 30 business days of effectiveness, or pay additional interest.

Unusual Items: None reported in this filing.

Investor Verification Checklist

• Verify the exact amount of the Metavante acquisition credit facility being retired to assess the net impact on total debt.
• Confirm the status and expected volume of the share repurchase tender offer now that the financing condition is satisfied.
• Review the specific terms of the "make-whole" premium for early redemption of the 2017 and 2020 Notes.
• Monitor compliance with the indenture covenants regarding restricted payments and additional indebtedness.
• Check for the filing of the exchange offer registration statement required under the Registration Rights Agreement within the 270-day window.