10-K/APeriod: FY2005

Fidelity National Information Services, Inc. Annual Report (Amendment), Year Ended Dec 31, 2005

Filed May 1, 2006For Securities:FIS

Summary

Fidelity National Information Services, Inc. (FIS) filed an amendment to its 2005 10-K report on May 1, 2006, primarily detailing information about its directors, executive officers, executive compensation, security ownership, and related party transactions. The report highlights significant post-merger integration and governance structures, reflecting the recent combination of entities. A key aspect is the shareholder agreement which dictates board composition, influenced by major stakeholders like FNF, THL, and TPG. Investors should note the substantial ownership by Fidelity National Financial, Inc. (FNF) at over 50%, establishing it as the parent company. The filing also details the compensation structures for named executive officers, including salaries, bonuses, and long-term incentive awards, with a notable portion of compensation tied to equity. Furthermore, the report outlines various intercompany agreements and transactions with affiliates, particularly with FNF and its subsidiaries, indicating ongoing operational integration and shared services.

Key Highlights

  • 1Fidelity National Financial, Inc. (FNF) is the majority shareholder, owning approximately 50.7% of FIS's common stock as of February 1, 2006, establishing it as the parent company.
  • 2The shareholder agreement significantly influences board composition, with specific designations made by FNF, THL, TPG, and former Certegy directors, alongside a requirement for independent directors.
  • 3The report details the compensation for key executive officers, including Lee A. Kennedy (President and CEO) and Jeffrey S. Carbiener (EVP and CFO), with significant amounts in salary, bonus, and long-term compensation such as stock options and restricted stock.
  • 4Several executive employment agreements were established post-merger, including those for Lee A. Kennedy and Jeffrey S. Carbiener, outlining terms of employment, severance, and equity awards.
  • 5The filing extensively details intercompany agreements and related party transactions, particularly with FNF and its subsidiaries (like FNT), covering corporate services, IT services, software licensing, and lease agreements, indicating significant operational integration.
  • 6The company has frozen its Pension Plan benefits and plans to terminate it effective May 31, 2006. Supplemental Executive Retirement Plans (SERP) are also detailed for key executives.
  • 7The Audit Committee transitioned from Ernst & Young to KPMG, LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2006.

Frequently Asked Questions

Following the merger, Fidelity National Financial, Inc. (FNF) is the majority shareholder, holding approximately 50.7% of FIS's common stock as of February 1, 2006. This makes FNF the parent company of FIS. Other significant shareholders include Thomas H. Lee Advisors LLC and TPG Partners III, L.P., each holding approximately 7.5%.

The composition of the Board of Directors is significantly influenced by a shareholder agreement. FNF designates four board members, THL and TPG each designate one, and three members are designated by former Certegy directors. The CEO also serves as a director. The agreement includes provisions to ensure a minimum number of independent directors and specifies conditions under which these designations remain valid, tied to shareholder ownership levels.

Executive compensation includes base salary, annual bonuses, and long-term incentives such as stock options and restricted stock awards. For instance, the CEO, Lee A. Kennedy, had a substantial salary and bonus in 2005, along with significant stock option grants and restricted stock awards. The report also details supplemental retirement benefits and change-in-control provisions for executives.

Yes, there are extensive ongoing relationships detailed in the filing. This includes corporate services agreements with FNF and FNT (a subsidiary of FNF) for various support functions, master information technology services agreements, software licensing, lease agreements, and employee benefit plan participation. These agreements indicate a high degree of operational integration between FIS and FNF.