8-KMaterial AgreementsExhibits & Filings

Fidelity National Information Services, Inc. 8-K Report, Material Agreement (Jun 29, 2006)

Filed June 29, 2006For Securities:FIS

Summary

This 8-K filing from Fidelity National Information Services, Inc. (FIS) details a significant corporate restructuring involving its parent company, Fidelity National Financial, Inc. (FNF), and another subsidiary, Fidelity National Title Group, Inc. (FNT). The primary transaction is a merger wherein FNF will merge with and into FIS, with FIS surviving as the corporate entity. This merger is designed to occur immediately after a spin-off of FNT from FNF. In this spin-off, FNF will contribute most of its assets and liabilities (excluding its stake in FIS) to FNT, and then distribute FNT shares to FNF stockholders. Following these transactions, FNF's sole asset will be its ownership in FIS, paving the way for the merger. For FIS shareholders, this means a significant change in corporate structure and governance. The merger will result in FNF shareholders receiving FIS common stock in exchange for their FNF shares, effectively consolidating the information services business under the FIS banner. Key executives will transition to leadership roles in the combined entity, with updated compensation packages and equity awards. The filing also outlines crucial terms related to shareholder approvals, tax implications, and the treatment of existing equity awards, all of which are critical for understanding the long-term implications of this strategic reorganization.

Key Highlights

  • 1FNF will merge into its majority-owned subsidiary, FIS, with FIS being the surviving entity.
  • 2The merger is contingent upon and will occur immediately after a spin-off transaction where FNF distributes shares of Fidelity National Title Group, Inc. (FNT) to FNF stockholders.
  • 3FNF shareholders will receive FIS common stock in exchange for their FNF common stock upon completion of the merger.
  • 4Key executives, including William P. Foley, II, Lee A. Kennedy, Brent B. Bickett, and Alan L. Stinson, will hold executive positions in the post-merger FIS entity, with updated compensation and equity grants.
  • 5The transactions are designed to qualify as tax-free reorganizations for both the spin-off (Section 355) and the merger (Section 368(a)) under the Internal Revenue Code, with specific tax disaffiliation and cross-indemnity agreements in place.
  • 6Both FNF and FIS shareholder approvals are required for the respective transactions.
  • 7Existing FNF equity awards (stock options and restricted stock) held by individuals who will become FIS service providers will be assumed by FIS, with equitable adjustments made.

Frequently Asked Questions

The primary purpose of the merger is to consolidate Fidelity National Financial, Inc.'s (FNF) information services business into a single, publicly traded entity, Fidelity National Information Services, Inc. (FIS), which will be the surviving corporation. This follows a planned spin-off of Fidelity National Title Group, Inc. (FNT) from FNF.

Upon completion of the merger, FNF shareholders will exchange their shares of FNF common stock for shares of FIS common stock. The number of FIS shares received will be based on a conversion ratio determined by the number of FIS shares FNF currently owns divided by the total outstanding FNF shares.

The company intends for both the spin-off of FNT and the merger of FNF into FIS to qualify as tax-free reorganizations under the Internal Revenue Code. However, specific tax consequences can depend on individual shareholder circumstances, and it's advisable to consult with a tax advisor.

FNF stock options and restricted stock held by individuals who will continue to work for FIS after the merger will generally be assumed by FIS, with adjustments to exercise prices and share counts. Certain executive stock options may be cashed out or replaced with FNT stock options as part of the transaction.