11-K Plan Year 2010
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K
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| | |
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x | | ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED] |
| | FOR THE FISCAL YEAR ENDED DECEMBER 31, 2010. |
OR
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| | |
| | |
o | | TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED |
| | for the transition period from __________ to __________ |
Commission file number 1-16427
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| | |
A. | | Full title of the plan and the address of the plan, if different from that of the issuer named below: Fidelity National Information Services, Inc 401(k) Profit Sharing Plan. |
| | |
B. | | Name of issuer of the securities held pursuant to the plan and the address of its principal executive office: Fidelity National Information Services, Inc., 601 Riverside Ave., Jacksonville, FL 32204 |
REQUIRED INFORMATION
Item 4. Plan Financial Statements and Schedules Prepared in Accordance with the Financial Reporting Requirements of ERISA
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Table of Contents
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Report of Independent Registered Public Accounting Firm | | | 1 |
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| | | | |
Statements of Net Assets Available for Benefits - December 31, 2010 and 2009 | | | 2 |
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| | | | |
Statements of Changes in Net Assets Available for Benefits - Years ended December 31, 2010 and 2009 | | | 3 |
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| | | | |
Notes to Financial Statements | | | 4-11 |
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| | | | |
Supplemental Schedules | | | | |
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Schedule H, Line 4a - Schedule of Delinquent Participant Contributions - Year Ended December 31, 2010 | | | 13 |
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Schedule H, Line 4i - Schedule of Assets (Held at End of Year) - December 31, 2010 | | | 14 |
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All other schedules are omitted because they are not applicable or not required based on disclosure requirements of the Employee Retirement Income Security Act of 1974 and regulations issued by the Department of Labor.
Report of Independent Registered Public Accounting Firm
Fidelity National Information Services, Inc.
Group Plans Committee:
We have audited the accompanying statements of net assets available for benefits of Fidelity National Information Services, Inc. 401(k) Profit Sharing Plan (the “Plan”) as of December 31, 2010 and 2009, and the related statements of changes in net assets available for benefits for the years then ended. These financial statements are the responsibility of the Plan's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly, in all material respects, the net assets available for benefits of the Plan as of December 31, 2010 and 2009, and the changes in net assets available for benefits for the years then ended, in conformity with U.S. generally accepted accounting principles.
Our audits were performed for the purpose of forming an opinion on the basic financial statements taken as a whole. The supplemental schedules, Schedule H, Line 4a - Schedule of Delinquent Participant Contributions for the year ended December 31, 2010, and Schedule H, Line 4i - Schedule of Assets (Held at End of Year) as of December 31, 2010, are presented for the purpose of additional analysis and are not a required part of the basic financial statements but are supplementary information required by the Department of Labor's Rules and Regulations for Reporting and Disclosure under the Employee Retirement Income Security Act of 1974. The supplemental schedules are the responsibility of the Plan's management. The supplemental schedules have been subjected to the auditing procedures applied in the audits of the financial statements and, in our opinion, are fairly stated in all material respects in relation to the basic financial statements taken as a whole.
/s/ KPMG LLP
June 29, 2011
Jacksonville, Florida
Certified Public Accountants
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Statements of Net Assets Available for Benefits
Years ended December 31, 2010 and 2009
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| | | | | | | | | | |
| | | | 2010 | | 2009 |
Assets: | | | | |
| Investments at fair value: | | | |
| | Employer common stock | $ | 46,945,419 |
| | $ | 42,551,101 |
|
| | Common stocks | — |
| | 24,827,588 |
|
| | Common/collective trust funds | 277,975,810 |
| | 248,350,396 |
|
| | Corporate bond funds | 73,632,704 |
| | 54,372,955 |
|
| | Mutual funds | 266,485,591 |
| | 181,703,389 |
|
| | Other cash equivalents | 811,918 |
| | 999,787 |
|
| | | Total investments, at fair value | 665,851,442 |
| | 552,805,216 |
|
| | | | | | |
| Receivables: | | | |
| | Notes receivable from participants | 18,099,426 |
| | 15,689,481 |
|
| | Participant contributions | 2,402,724 |
| | 2,521,156 |
|
| | Employer contributions | 910,543 |
| | 901,095 |
|
| | Due from broker for securities sold | 1,789,551 |
| | 966,759 |
|
| | Due from Wells Fargo | 121,191 |
| | 77,747 |
|
| | Accrued interest | 177 |
| | 203 |
|
| | | Total receivables | 23,323,612 |
| | 20,156,441 |
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| | | | | | |
| | | Total assets | 689,175,054 |
| | 572,961,657 |
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| | | | | | |
Liabilities: | | | |
| Due to broker for securities purchased | 1,053,875 |
| | 992,482 |
|
| Accrued administrative expenses | 42,381 |
| | 72,343 |
|
| | | Total liabilities | 1,096,256 |
| | 1,064,825 |
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| | | | | | |
| | | Net assets available for benefits before adjustments | 688,078,798 |
| | 571,896,832 |
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| | | | | | |
Adjustment from fair value to contract value for fully benefit-responsive | | | |
| investment contracts | (3,677,857 | ) | | (337,548 | ) |
| | | | | | |
| | | Net assets available for benefits | $ | 684,400,941 |
| | $ | 571,559,284 |
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See accompanying notes to financial statements.
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Statements of Changes in Net Assets Available for Benefits
Years ended December 31, 2010 and 2009
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| | | | | | | | | | |
| | | | 2010 | | 2009 |
Investment income: | | | |
| Net appreciation in fair value of investments | $ | 57,136,541 |
| | $ | 73,643,063 |
|
| Interest and dividends | 4,966,721 |
| | 6,793,936 |
|
| | | Total investment income | 62,103,262 |
| | 80,436,999 |
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| | | | | | |
Income on loans to participants | 840,883 |
| | 888,001 |
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| | | | | | |
Contributions | | | |
| Participant | 63,415,303 |
| | 46,479,808 |
|
| Employer | 22,691,357 |
| | 15,494,437 |
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| Rollovers from qualified plans | 12,261,354 |
| | 2,228,430 |
|
| | | Total contributions | 98,368,014 |
| | 64,202,675 |
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| | | | | | |
Deductions from net assets attributable to: | | | |
| Benefits paid to participants | (48,130,103 | ) | | (52,913,766 | ) |
| Administrative expenses | (340,399 | ) | | (464,573 | ) |
| | | Total deductions | (48,470,502 | ) | | (53,378,339 | ) |
| | | | | | |
| | | Net increase | 112,841,657 |
| | 92,149,336 |
|
| | | | | | |
Net assets available for benefits: | | | |
| Beginning of year | 571,559,284 |
| | 479,409,948 |
|
| | | | |
| End of year | $ | 684,400,941 |
| | $ | 571,559,284 |
|
| | | | | | |
See accompanying notes to financial statements.
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
(1) Description of the Plan
The following description of the Fidelity National Information Services, Inc. 401(k) Profit Sharing Plan (the FIS Plan) provides only general information. The FIS Plan and its related Trust are intended to qualify as a profit-sharing plan and trust under Sections 401(a) and 501(a) of the Internal Revenue Code (the Code), with a cash or deferred arrangement within the meaning of Section 401(k) of the Code. In addition, the FIS Plan is intended to qualify as a stock bonus plan that satisfies the requirements of an employee stock ownership plan (ESOP) within the meaning of Section 4975(e)(7) of the Code. That portion of the FIS Plan is designed to invest primarily in shares of Fidelity National Information Services, Inc. (FIS or the Company or the Employer or the Plan Sponsor).
The purpose of the FIS Plan is to provide retirement benefits to participants and their beneficiaries in a manner consistent and in compliance with the Code and the Employee Retirement Income Security Act of 1974 (ERISA). The Company shall maintain and administer the FIS Plan for the exclusive benefit of participants and their beneficiaries. Participants should refer to the FIS Plan document for more complete information of the FIS Plan's provisions.
(a) General
The FIS Plan is a defined contribution retirement plan covering all employees of the Company who have attained age 18 and have completed 90 days of service. Temporary, part-time or seasonal employees are eligible to participate in the FIS Plan if 18 years of age or older and upon completion of 1,000 hours of service during the plan year. Union, nonresident aliens and leased employees are not eligible to participate in the FIS Plan. Employees are automatically enrolled in the FIS Plan if they do not decline enrollment within 30 days of becoming eligible.
(b) Contributions
During 2010 and 2009, participants could contribute up to 40% of pretax annual compensation through payroll deductions, as defined in the FIS Plan. Participants who have attained age 50 before the end of the FIS Plan year are eligible to make catch-up contributions. Participants may also contribute amounts representing distributions from other qualified defined benefit or defined contribution plans, as well as direct rollovers from individual retirement accounts or annuities. During 2010 and 2009, the Company made matching contributions equal to 50% of participant deferrals up to 6% of eligible compensation. Discretionary employer contributions may be made at the option of the Company's board of directors.
The Company match for 2010 and 2009 of $22.7 million and $15.5 million, respectively, was funded throughout the year. No discretionary employer contributions were made during the years ended December 31, 2010 and 2009. Through March 31, 2009, all employer contributions are considered ESOP allocations and were made in cash and then invested in employer stock (see Note 9). A participant could, at their discretion, diversify their ESOP allocation in their account at any time. Effective April 1, 2009, all employer contributions are invested according to the participants' investment elections. Contributions are subject to certain limitations.
(c) Participant Accounts
Each participant's account is credited with the participant's contribution, the employer's contribution, and an allocation of FIS Plan earnings, and charged with an allocation of FIS Plan losses and expenses, if any.
Allocations are based on participant earnings or account balances, as defined. The benefit to which a participant is entitled is the benefit that can be provided from the participant's vested account.
(d) Vesting
Participants are immediately vested in their contributions plus actual earnings thereon. Vesting in the Company's matching and discretionary contribution portion of their accounts, plus actual earnings thereon, is based on years of service as follows:
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
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| | | | |
| | | Vested |
| | | Percentage |
Number of years of service: | | |
| Less than 1 year | | 0 | % |
| 1 year | | 34 | % |
| 2 years | | 67 | % |
| 3 years or more | | 100 | % |
(e) Forfeitures
Upon termination of employment, the nonvested portion of a participant's interest in their account attributable to employer contributions will be forfeited. These forfeitures can be used to restore the accounts of former FIS Plan participants, pay administrative expenses of the FIS Plan, if not paid by the Company, or reduce future Company matching contributions. During 2010 and 2009, $0.7 million and $1.5 million, respectively, of forfeitures were used to offset employer contributions in accordance with the FIS Plan document. As of December 31, 2010 and 2009, there were $0.3 million and $0.5 million, respectively, of unused forfeitures.
(f) Notes Receivable from Participants
Participants may borrow from their fund accounts a minimum of $1,000, and are permitted to have two loans outstanding at a time. Loans may generally be taken up to 50% of a participant's vested account balance, but cannot exceed $50,000. Loans are generally repaid through payroll deductions with a 5-year maximum limit, except for loans for home purchases which may have terms up to 10 years. Interest rates are set at the date of the loan at the prime rate as determined by the Plan's Trustee or its affiliate plus 1%. Loan related fees for set-up and maintenance are paid by the participant. Interest rates range from 3.25% to 10.5% on loans outstanding as of December 31, 2010. Participant loans are measured at their unpaid principal balance plus any accrued but unpaid interest.
(g) Payment of Benefits
Withdrawals from participant accounts may be made only for the following reasons: retirement at the FIS Plan's normal retirement age (65), when a participant reaches age 59 1/2, disability, death, or termination of employment. On termination of employment, a participant may receive the value of the participant's vested interest in his or her account as a lump-sum distribution. If a participant's account balance is less than $1,000 upon retirement or termination, a distribution of the participant's account will be made automatically. For termination of service for other reasons, a participant may receive the value of the vested interest in his or her account as a lump-sum distribution.
(h) Administration
During 2010 and 2009, the trustee of the FIS Plan was Wells Fargo Bank, NA (Wells Fargo). Wells Fargo also performs participant recordkeeping and other administrative duties for the FIS Plan. Fidelity National Information Services, Inc. Group Plans Committee (the Committee) oversees the FIS Plan's operations.
(i) Administrative Expenses
Under the terms of the FIS Plan document, administrative expenses of the FIS Plan are paid by the FIS Plan or FIS.
(j) Investment Options
Participants may direct their elective deferrals in and among various investment options. Participants may change their investment elections and transfer funds between investment options on a daily basis. At December 31, 2010, the investment options consist of one Employer common stock fund, four common/collective trust funds, three corporate bond funds, and seven mutual funds. Investments in the Company's common stock fund include an investment in a money market fund for liquidity purposes (see Note 9).
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
Certain participants were previously invested in shares of former affiliated companies under predecessor plans. The balances for participants who previously invested in shares of Fidelity National Financial, Inc. (New FNF) common stock under the FNF Plan were transferred into a frozen New FNF Stock Fund. The balances for participants who previously invested in shares of Equifax Inc. (Equifax) common stock under the Equifax 401(k) Plan were transferred into a frozen Equifax Stock Fund. The balances of participants who received shares of Lender Processing Services, Inc. (LPS) common stock during the spin-off of that former subsidiary were transferred into a frozen LPS Stock Fund. The frozen New FNF Stock Fund, Equifax Stock Fund and LPS Stock Fund appreciate and depreciate with the value of the respective common stock, but participants can no longer make contributions into the funds. Participants may elect to transfer balances from the frozen New FNF Stock Fund, Equifax Stock Fund, and LPS Stock Fund to other funds within the FIS Plan. The frozen New FNF Stock Fund, Equifax Stock Fund and LPS Stock Fund are reflected as common stock in the accompanying Statements of Net Assets Available for Benefits at December 31, 2009. Shares held in these stock funds as of the close of business on December 31, 2009 were transferred to the Plan's default fund, the Oakmark Equity and Income Fund (mutual fund) on January 1, 2010.
Dividends paid by the Company with respect to shares of FIS stock held by the ESOP shall be (1) paid in cash directly to participants in the ESOP, (2) paid in cash directly to the ESOP and distributed in cash to the participants in the ESOP, or (3) paid to the FIS Plan and reinvested in FIS stock. Cash dividends received on shares of FIS stock will be allocated to each participant's ESOP Allocations Account (ESOP Account) based on the number of shares of FIS stock held in each such ESOP Account, unless the participant elects to receive such dividends in cash (see Note 9).
(k) Voting Rights
Each participant shall be entitled to direct the trustee to vote and to direct the trustee with respect to the tender of any FIS common stock allocated to the participant's accounts in accordance with the terms of the Trust. Shares for which no direction is received shall be voted by the Trustee in the same manner and proportion as the shares for which direction is received.
(2) Summary of Significant Accounting Policies
(a) Basis of Presentation
The financial statements of the FIS Plan are prepared on the accrual basis of accounting.
Investment contracts held by a defined-contribution plan are required to be reported at fair value. However, contract value is the relevant measurement attribute for that portion of the net assets available for benefits of a defined-contribution plan attributable to fully benefit-responsive investment contracts because contract value is the amount participants would receive if they were to initiate permitted transactions under the terms of the FIS Plan. The Statements of Net Assets Available for Benefits present the fair value of the investment contracts as well as the adjustment of the fully benefit-responsive investment contracts from fair value to contract value. The Statements of Changes in Net Assets Available for Benefits are prepared on a contract value basis.
(b) Use of Estimates
The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires the FIS Plan's management to make estimates and assumptions that affect the reported amounts of assets, liabilities, and changes therein, and disclosure of contingent assets and liabilities. Actual results could differ from those estimates.
(c) Risk and Uncertainties
The FIS Plan invests in various investment securities. Investment securities are exposed to various risks such as interest rate, market and credit risks. Due to the level of risk associated with certain investment securities, it is at least reasonably possible that changes in the values of investment securities will occur in the near term and that such changes could materially affect participants' account balances and the amounts reported in the Statements of Net Assets Available for Benefits.
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
(d) Investment Valuation and Income Recognition
Investments are reported at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. See note 3 for discussion of fair value measurements.
Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on an accrual basis. Dividends are recorded on the ex-dividend date. Net appreciation includes the FIS Plan's gains and losses on investments bought and sold as well as held during the year.
The FIS Plan provides participants with the option of directing their elective deferrals into four Wells Fargo common/collective trust funds which include the Wells Fargo Stable Return Fund N, Wells Fargo S&P 500 Index Fund N, Wells Fargo S&P Midcap Index Fund G and Wells Fargo International Equity Index Fund G. The Wells Fargo Stable Return Fund N invests in guaranteed investment contracts and synthetic investment contracts. The Wells Fargo S&P 500 Index Fund N invests in common stocks in substantially the same percentages as the S&P 500 Index with the objective of approximating, before fees and expenses, the total return of the S&P 500 Index. The Wells Fargo S&P Midcap Index Fund G invests in equities of the S&P Midcap Index with the objective of approximating, before fees and expenses, the total return of the S&P Midcap Index. The Wells Fargo International Equity Index Fund G generally intends to remain 90% invested in stocks comprising the Morgan Stanley Capital International Europe Australasia and Far East Index and 10% in cash reserves and seeks to approximate the total return, before deduction of fees and expenses, as measured by the index.
Investment options in common/collective trusts are valued using the audited financial statements of the collective trust at year-end using net asset value (NAV) as a practical expedient. Notwithstanding a twelve month replacement notification requirement on the Wells Fargo Stable Return Fund N, the common/collective trust funds do not have limiting terms, or restrictions on redemption. Additionally, the common collective trust funds are not subject to future unfunded commitments, and it is not probable that they will be sold at a value other than NAV.
(e) Payment of Benefits
Benefits are recorded when paid.
(f) Certain Reclassifications
Certain reclassifications have been made in the 2009 Financial Statements to conform to the classifications used in 2010.
(3) Fair Value Measurements
(a) Fair Value of Financial Instruments
The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Investments are measured at fair value in the accompanying Statements of Net Assets Available for Benefits. Participant and employer contributions receivable, receivables due from Wells Fargo, and amounts due to and from brokers approximate fair value based on their short-term nature.
(b) Fair Value Hierarchy
The authoritative accounting literature defines fair value, establishes a framework for measuring fair value, and establishes a fair value hierarchy based on the quality of inputs used to measure fair value.
The fair value hierarchy includes three levels which are based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
(Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the investment. The three levels of the fair value hierarchy are described below:
Level 1. Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the FIS Plan has the ability to access.
Level 2. Inputs to the valuation methodology include:
•Quoted prices for similar assets or liabilities in active markets;
•Quoted prices for identical or similar assets or liabilities in inactive markets;
•Inputs other than quoted prices that are observable for the asset or liability; and
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• | Inputs that are derived principally from or corroborated by observable market data by correlation or other means. |
If the asset or liability has a specified (contractual) term, the Level 2 input must be observable for substantially the full term of the asset or liability.
Level 3. Inputs to the valuation methodology are unobservable and significant to the fair value measurement.
Following is a description of the valuation methodologies used for assets and liabilities measured at fair value.
Common stocks and other cash equivalents: Valued at the closing price reported on the active market on which the security is traded.
Mutual funds and corporate bond funds: Valued based on quoted market prices of shares held by the FIS Plan at year end.
Common collective trust funds: Valued at NAV as a practical expedient to measuring fair value, primarily based on the fair value of the underlying investments at quoted market prices, as determined by the Trustee of the fund of shares held by the FIS Plan at year end.
The following table sets forth, by level within the fair value hierarchy, the Plan's assets at fair value as of December 31, 2010 and 2009.
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| | | | | | | | | | | | | | | | | | |
| | | | Assets at fair value as of December 31, 2010 |
| | | | (Level 1) | | (Level 2) | | (Level 3) | | Total |
Investments: | | | | | | | | |
| Employer common stock | | $ | 46,945,419 |
| | $ | — |
| | $ | — |
| | $ | 46,945,419 |
|
| Common/collective trust funds | | — |
| | 277,975,810 |
| | — |
| | 277,975,810 |
|
| Corporate bond funds | | 73,632,704 |
| | — |
| | — |
| | 73,632,704 |
|
| Mutual funds | | 266,485,591 |
| | — |
| | — |
| | 266,485,591 |
|
| Other cash equivalents | | 811,918 |
| | — |
| | — |
| | 811,918 |
|
| | | | | | | | | | |
| | Total investments at fair value | | $ | 387,875,632 |
| | $ | 277,975,810 |
| | $ | — |
| | $ | 665,851,442 |
|
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
|
| | | | | | | | | | | | | | | | | | |
| | | | Assets at fair value as of December 31, 2009 |
| | | | (Level 1) | | (Level 2) | | (Level 3) | | Total |
Investments: | | | | | | | | |
| Employer common stock | | $ | 42,551,101 |
| | $ | — |
| | $ | — |
| | $ | 42,551,101 |
|
| Common stocks | | 24,827,588 |
| | — |
| | — |
| | 24,827,588 |
|
| Common/collective trust funds | | — |
| | 248,350,396 |
| | — |
| | 248,350,396 |
|
| Corporate bond funds | | 54,372,955 |
| | — |
| | — |
| | 54,372,955 |
|
| Mutual funds | | 181,703,389 |
| | — |
| | — |
| | 181,703,389 |
|
| Other cash equivalents | | 999,787 |
| | — |
| | — |
| | 999,787 |
|
| | | | | | | | | | |
| | Total investments at fair value | | $ | 304,454,820 |
| | $ | 248,350,396 |
| | $ | — |
| | $ | 552,805,216 |
|
(4) Investments
Investments that represent 5% or more of the FIS Plan's net assets, at fair value, as of December 31, 2010 and 2009 are as follows:
|
| | | | | | | | |
| | 2010 | | 2009 |
Wells Fargo Stable Return Fund N | | $ | 170,853,177 |
| | $ | 169,111,662 |
|
Oakmark Equity and Income Fund Class One | | 106,938,382 |
| | 59,570,071 |
|
Wells Fargo S&P 500 Index Fund N | | 50,390,631 |
| | 38,770,804 |
|
Fidelity National Information Services, Inc. common stock | | 46,945,419 |
| | 42,551,101 |
|
Wells Fargo S&P Midcap Index Fund G | | 39,248,548 |
| | 26,490,477 |
|
Artio International Equity Fund | | 37,041,417 |
| | 33,279,018 |
|
American Growth Fund of America Class R4 | | 35,618,218 |
| | 29,627,728 |
|
All other investments less than 5% | | 178,815,650 |
| | 153,404,355 |
|
| | | | |
Total investments, at fair value | | $ | 665,851,442 |
| | $ | 552,805,216 |
|
During 2010 and 2009, the FIS Plan's investments (including gains and losses on investments bought and sold, as well as held during the year) appreciated (depreciated) in value by investment type, as follows:
|
| | | | | | | | |
| | 2010 | | 2009 |
Employer common stock | | $ | 7,053,467 |
| | $ | 13,901,748 |
|
Common stocks | | (70,104 | ) | | 2,325,785 |
|
Common/collective trust funds | | 19,863,304 |
| | 22,797,788 |
|
Corporate bond funds | | 2,668,718 |
| | 3,565,504 |
|
Mutual funds | | 27,621,156 |
| | 31,052,238 |
|
| | | | |
Net appreciation in fair value of investments | | $ | 57,136,541 |
| | $ | 73,643,063 |
|
As stated in notes 2(a) and 2(d), the Wells Fargo Stable Return Fund N (the Fund), which is deemed to be fully benefit-responsive, is stated at fair value in the Statements of Net Assets Available for Benefits, with a corresponding adjustment to reflect contract value. The fair value of the Fund as of December 31, 2010 and 2009 was $170.9 million and $169.1 million, respectively. The contract value of the Fund as of December 31, 2010 and 2009 was $167.2 million and $168.8 million, respectively. There are no reserves against the contract value for credit risk of the contract issuer or
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
otherwise. During 2010 and 2009, the average yield of the Fund was approximately 2.38% and 3.40%, respectively. This represents the annualized earnings of all investments in the Fund, divided by the fair value of all investments in the Fund. During 2010 and 2009, the crediting interest rate of the Fund was approximately 2.90% and 3.32%, respectively. This represents the annualized earnings credited to participants in the Fund, divided by the fair value of all investments in the Fund. The credit rating assigned to Wells Fargo by Standard & Poor's at December 31, 2010 is AA-.
Certain events limit the liability of the Plan to transact at contract value with the issuer. Such events include the following: (1) the Plan's failure to qualify under Section 401(a) or Section 401(k) of the IRC, (2) the establishment of a defined contribution plan that competes with the Plan for employee contributions, (3) any substantive modification of the fund or the administration of the fund that is not consented to by the issuer, (4) any change in law, regulation or administrative ruling applicable to the Plan that could have a material adverse effect on the fund's cash flow, (5) any communication given to participants by the Plan's sponsor or fiduciary or Wells Fargo that is designed to induce or influence participants to avoid investing in the fund or to transfer assets out of the fund, and (6) any transfer of assets from the fund directly to a competing investment option. The Plan administrator does not believe that the occurrence of any of these events which would limit the Plan's ability to transact at contract value with participants is probable of occurring.
(5) Related Party Transactions
Certain FIS Plan investments are shares of common/collective trust funds and mutual funds managed by Wells Fargo. Wells Fargo is the Trustee as defined by the FIS Plan and, therefore, these transactions qualify as party-in-interest transactions. Fees paid by the FIS Plan for investment management services were $0.1 million for each of the years ended December 31, 2010 and 2009. Additionally, transactions involving shares of common stock of the Company, New FNF, and LPS are parties-in-interest transactions. Dividends on these common stock shares totaled $0.4 million and $1.0 million for the years ended December 31, 2010 and 2009, respectively.
(6) Income Tax Status
The FIS Plan is a defined contribution retirement plan that is intended to be qualified under Section 401(a) of the Code. Once qualified, the FIS Plan is required to operate in conformity with the Code to maintain its qualification as tax exempt. The FIS Plan submitted an initial application for a determination letter with the Internal Revenue Service on March 15, 2007.
Accounting principles generally accepted in the United States of America require plan management to evaluate tax positions taken by the plan and recognize a tax liability (or asset) if the plan has taken an uncertain position that more likely than not would not be sustained upon examination by the applicable taxing authorities. The plan administrator has analyzed the tax positions taken by the Plan, and has concluded that as of December 31, 2010, there are no uncertain positions taken or expected to be taken that would require recognition of a liability (or asset) or disclosure in the financial statements.
During 2009, the Plan Sponsor identified an operational compliance issue with the FIS Plan in which eligibility was calculated incorrectly for temporary employees. The Plan Sponsor is in the process of correcting this matter in accordance with the Internal Revenue Service Employee Plans Compliance Resolution System (EPCRS) program. The Plan administrator and the Plan Sponsor believe that an additional employer contribution totaling $64,720 will be required to resolve this operational compliance issue, which has been included in employer contributions receivable in the accompanying Statements of Net Assets Available for Benefits at December 31, 2010 and 2009. The Plan Sponsor has established additional procedures to ensure that the FIS Plan's operations are in compliance with the provisions of the Code. The plan administrator and tax counsel believe that the FIS Plan is currently operating in compliance with the FIS Plan document and the Code.
(7) Plan Termination
Although it has not expressed any intent to do so, the Company has the right under the FIS Plan to discontinue its contributions at any time and to terminate the FIS Plan subject to the provisions of ERISA. In the event of the FIS Plan's termination, participants will become 100% vested in their employer contributions.
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Notes to Financial Statements
December 31, 2010 and 2009
(8) Reconciliation of Financial Statements to Form 5500
The following is a reconciliation of net assets available for benefits per the financial statements to the expected 2010 and actual 2009 Form 5500:
|
| | | | | | | | | |
| | | 2010 | | 2009 |
Net assets available for benefits, per the financial statements | | $ | 684,400,941 |
| | $ | 571,559,284 |
|
| Less current year adjustment to contract value for fully benefit-responsive investment contracts | | 3,677,857 |
| | 337,548 |
|
| | | | | |
Net assets available for benefits, per the Form 5500 | | $ | 688,078,798 |
| | $ | 571,896,832 |
|
The following is a reconciliation of investment income per the financial statements to the expected 2010 and actual 2009 Form 5500:
|
| | | | | | | | | |
| | | 2010 | | 2009 |
Total investment income per the financial statements | | $ | 62,103,262 |
| | $ | 80,436,999 |
|
| Plus prior year adjustment to contract value for fully benefit-responsive investment contracts | | (337,548 | ) | | 9,716,201 |
|
| Less current year adjustment to contract value for fully benefit-responsive investment contracts | | 3,677,857 |
| | 337,548 |
|
| | | | | |
Total investment income per the Form 5500 | | $ | 65,443,571 |
| | $ | 90,490,748 |
|
(9) Subsequent Events
Effective July 28, 2011 at 4:00 P.M. Eastern Standard Time (EST), no new contributions, loan payments or transfers into the FIS Stock Fund will be permitted. Participants will have until the July 28, 2011 cutoff, to redirect future contributions to other Plan investments. After the July 28, 2011 cutoff, any future contributions allocation percentages directed to the FIS Stock Fund will be automatically changed to the Plan's default fund the Oakmark Equity and Income Fund (mutual fund). Beginning November 2011 the Plan will begin selling all remaining shares in the FIS Stock Fund. Participants will have until November 29, 2011 at 4:00 P.M. EST to redirect any remaining balance in the participant's FIS Stock Fund to other Plan investments. On November 30, 2011 the remaining balance in the FIS Stock Fund will be automatically transferred to the Plan's default fund, the Oakmark Equity and Income Fund (mutual fund) and the FIS Stock Fund will be terminated.
The Company has evaluated transactions, events and circumstances for consideration of recognition or disclosure and has reflected or disclosed those items within the financial statements as deemed appropriate.
Supplemental Schedules
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Schedule H, Line 4a - Schedule of Delinquent Participant Contributions
Year Ended December 31, 2010
|
| | | | | | | | | | | | | | | | | | | | | |
| | Participant | | | | | | Contributions | | Totally Fully | | |
| | Contributions | | | | Contributions | | Pending | | Corrected | | |
| | Transferred | | Contributions | | Corrected | | Correction in | | Under VFCP and | | Lost |
Year Ended | | Late to Plan | | Not Corrected | | Outside VFCP | | VFCP | | PTE 2002-51 | | Interest |
December 31, 2009 | | $ | 1,865 |
| | — |
| | $ | 1,865 |
| | — |
| | — |
| | $ | 2 |
|
There were delays by the Company in December 2009 in remitting employee contributions to the trustee in the amount of $1,865. The Company reimbursed the Plan for lost interest in the amount of $2 in January 2010.
See accompanying report of independent registered public accounting firm.
FIDELITY NATIONAL INFORMATION SERVICES, INC.
401(k) PROFIT SHARING PLAN
Schedule H, Line 4i - Schedule of Assets (Held at End of Year)
December 31, 2010
|
| | | | | | | | | |
| | Identity of issue, borrower | | Description of investment, including maturity date, rate of | | |
| | lessor, or similar party | | interest, number of shares, collateral, par or maturity value | | Value |
| | Employer common stock: | | | | |
(1) | | | Fidelity National Information Services, Inc. | | Common stock, 1,713,962 shares | | $ | 46,945,419 |
|
| | | | | | | |
| | Common/collective trust funds: | | | | |
(1) | | | Wells Fargo | | Wells Fargo Stable Return Fund N4, 3,655,882 shares | | 170,853,177 |
|
(1) | | | Wells Fargo | | Wells Fargo S&P 500 Index Fund N, 844,913 shares | | 50,390,631 |
|
(1) | | | Wells Fargo | | Wells Fargo S&P Midcap Index Fund G, 1,982,250 shares | | 39,248,548 |
|
(1) | | | Wells Fargo | | Wells Fargo International Equity Index Fund G, 1,296,992 shares | | 17,483,454 |
|
| | | | | | | |
| | Corporate bond funds: | | | | |
| | | The Dreyfus Corporation | | Dreyfus Intermediate Term Income Fund, 2,464,840 shares | | 32,240,104 |
|
| | | Vanguard Investments | | Vanguard Intermediate Term Bond Index Fund, 2,161,957 shares | | 24,317,450 |
|
| | | PIMCO | | PIMCO Real Return Bond Fund Class I, 1,505,263 shares | | 17,075,150 |
|
| | | | | | | |
| | Mutual funds: | | | | |
| | | The Oakmark Funds | | Oakmark Equity and Income Fund Class One, 3,855,025 shares | | 106,938,382 |
|
| | | The Julius Baer Group | | Artio International Equity Fund, 1,228,979 shares | | 37,041,417 |
|
| | | American Funds | | American Growth Fund of America Class R4, 1,179,802 shares | | 35,618,218 |
|
| | | Van Kampen Investments | | Van Kampen Comstock Fund Class A, 1,804,749 shares | | 28,388,697 |
|
| | | RS Investments | | Robert Stephens Value Fund Class A, 785,118 shares | | 20,342,398 |
|
| | | The Dreyfus Corporation | | Dreyfus Small Cap Stock Index Fund, 981,706 shares | | 20,046,427 |
|
| | | The Hartford | | Hartford Small Company HLS Fund Class 1B, 1,054,136 shares | | 18,110,052 |
|
| | | | | | | |
| | Other cash equivalents: | | | | |
(1) | | | Wells Fargo | | Wells Fargo Short-term Investment Fund G, 598,528 shares | | 598,528 |
|
(1) | | | Wells Fargo | | Wells Fargo Advantage Cash Money Market, 213,390 shares | | 213,390 |
|
| | | | | | | |
| | Notes receivable from participants | | Varying maturities and interest rates from 3.25% to 10.5%. A total | | |
| | | | | of 4,104 loans are outstanding with maturities from January 2011 | | |
| | | | | through December 2020. | | 18,099,426 |
|
| | | | | | | $ | 683,950,868 |
|
(1) Represents a party-in-interest.
See accompany report of independent registered public accounting firm.
Pursuant to the requirements of the Securities Exchange Act of 1934, the Trustees (or other persons who administer the employee benefit plan) have duly caused this annual report to be signed on its behalf by the undersigned hereunto duly authorized.
|
| | |
| FIDELITY NATIONAL INFORMATION SERVICES, INC. |
| 401 (k) Profit Sharing Plan |
Date: June 29, 2011 | By: | /s/ Michael P. Oates |
| | Michael P. Oates |
| | Trustee |
EXHIBIT INDEX
|
| | | | |
Exhibit No. | | | | Page No. |
23 | | Consent of Independent Registered Public Accounting Firm | | 17 |