RISK FACTORS

An investment in the shares offered by this prospectus involves a significant degree of risk.  You should carefully consider the risks described in this prospectus and in the documents incorporated by reference in this prospectus, including our Annual Report on Form 10-K for the year ended December 31, 2004, our Quarterly Reports on Form 10-Q for the quarters ended March 31, 2005, June 30, 2005, and September 30, 2005, and our Current Reports on Form 8-K and other filings made by us with the SEC, both before and after the date of this prospectus, before you decide to buy our common stock.  These risks could materially affect our business, results of operations, or financial condition and cause the trading price of our common stock to decline.  While we have described all risks and uncertainties that we believe to be material to our business, it is possible that other risks and uncertainties that affect our business will arise or become material in the future.

Risks Resulting from Our Recently Completed Business Combination

We will be controlled by Fidelity National Financial, Inc., or FNF, as long as it owns a majority of our common stock, and our other shareholders generally will be unable to affect the outcome of shareholder voting during this time.

As a result of our recently completed business combination, FNF owns approximately 50.7% of the outstanding shares of our common stock.  Subject to limitations under a shareholders agreement that we entered into with FNF and the selling shareholders, as long as FNF continues to hold a majority of our outstanding common stock, FNF will be able to elect all of our directors and determine the outcome of all corporate actions requiring shareholder approval.  Further, under the shareholders agreement, until FNF no longer owns at least 30% of the total voting power of our outstanding stock, FNF will have the right to approve the hiring and firing of our Chief Executive Officer and Chief Financial Officer and our annual operating and capital expenditure budgets.

In addition, FNF’s voting control will enable it to control decisions with respect to:

•                                           our business direction and policies;

•                                           mergers or other business combinations involving us or our subsidiaries, except as described below;

•                                           the acquisition or disposition of assets by us or our subsidiaries;

•                                           our financing; and

•                                           amendments to our articles of incorporation and bylaws.

Although it will control whether we can merge or combine with a third party, FNF has agreed, under the shareholders agreement, to certain limitations on its ability to cause us to engage in transactions which are commonly referred to as “going-private transactions.”

In addition to these effects, FNF’s control could make it more difficult for us to raise capital by selling stock or for us to use our stock as currency in acquisitions.  This concentrated ownership also might delay or prevent a change in control and may impede or prevent transactions in which our other shareholders might otherwise receive a premium for their shares.

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We could have conflicts with FNF, and the Chairman of our board of directors and other officers and directors will be subject to conflicts of interest due to their relationships with FNF and its other subsidiaries.

Conflicts may arise between FNF, FNF’s majority owned subsidiary Fidelity National Title Group, Inc., or FNT, or their respective subsidiaries, on the one hand, and us, on the other, as a result of the parties’ ongoing agreements and the nature of their respective businesses.  Among other things, we and our subsidiaries are parties to a variety of intercompany agreements with FNF, FNT or FNT’s subsidiaries that pre-date the business combination.  Certain of our executive officers and directors will be subject to conflicts of interest with respect to these intercompany agreements and other matters due to their relationships with FNF, FNT or their respective subsidiaries.

Some of our executive officers and directors own substantial amounts of FNF and FNT stock and stock options because of their relationships with FNF and FNT.  Such ownership could create or appear to create potential conflicts of interest when our directors and officers are faced with decisions that involve FNF, FNT or any of their respective subsidiaries.  Each of William P. Foley, II, Daniel D. (Ron) Lane, Terry N. Christensen and Cary H. Thompson, who are members of our board of directors, beneficially owns shares of FNF common stock.  Other of our senior officers hold interests in FNF that were obtained through various employee benefit and compensation plans while at FNF and Old FIS.  In addition, officers of FNF will provide services from time to time to us, FNT and FNF.  These persons also hold equity interests in FNF.

Mr. Foley, the Chairman of our board of directors, is also the Chief Executive Officer and Chairman of the board of directors of FNF and Chairman of the board of directors of FNT.  As an officer and director of these companies, he has obligations to us as well as to FNF and FNT and will have conflicts of interest with respect to matters potentially or actually involving or affecting us and FNF or any of its subsidiaries, including FNT.

Matters that could give rise to conflicts between us and FNF or its other subsidiaries include, among other things:

•                                           past and ongoing contractual relationships involving us or our subsidiaries, on the one hand, and FNF and its subsidiaries, on the other hand, including intercompany agreements and other arrangements with respect to the administration of tax matters, employee benefits, indemnification and other matters;

•                                           the quality and pricing of services that we have agreed to provide to FNF subsidiaries or that those entities have agreed to provide to us;

•                                           sales or distributions by FNF of all or part of its ownership interest in our common stock; and

•                                           business opportunities arising for either us or FNF, FNT or their respective subsidiaries that could be pursued by either us or by FNF, FNT or one or more of their respective subsidiaries.

We seek to manage these potential conflicts through dispute resolution and other provisions of our agreements with FNF, FNT and their respective subsidiaries and through oversight by independent members of our board of directors.  However, there can be no assurance that such measures will be effective or that we will be able to resolve all potential conflicts with FNF, or that the resolution of any such conflicts will be no less favorable to us than if it were dealing with an unaffiliated third party.

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We may lack adequate oversight because the Chairman of our board of directors is also both the Chief Executive Officer and Chairman of the board of directors of FNF and the Chairman of the board of directors of FNT.

Mr. Foley, the Chairman of our board of directors, is also the Chairman of FNT’s board of directors and the Chief Executive Officer and Chairman of the board of directors of FNF.  As an officer and director of multiple companies, he has obligations to us as well as FNF and FNT and may have conflicts of time with respect to matters potentially or actually involving or affecting us.  As a non-executive chairman, it is expected that Mr. Foley will devote a minority of his time to us.  If his duties as our Chairman require more time than Mr. Foley is able to allot, then his oversight of our activities could be diminished.

Our substantial leverage and debt service requirements may adversely affect our financial and operational flexibility.

Following completion of the business combination, we had total debt of approximately $2.8 billion.  This high level of debt could have important consequences to us, including the following:

•                                           the debt level makes us more vulnerable to economic downturns and adverse developments in our business, may cause us to have difficulty borrowing money in the future for working capital, capital expenditures, acquisitions, or other purposes and will limit our ability to pursue other business opportunities and implement certain business strategies;

•                                           we will need to use a large portion of the money we earn to pay principal and interest on our senior credit facilities, which will reduce the amount of money available to finance operations, acquisitions and other business activities, repay other indebtedness and pay shareholder dividends;

•                                           some of the debt has a variable rate of interest, which exposes us to the risk of increased interest rates; and

•                                           we will have a higher level of debt than certain of our competitors, which may cause a competitive disadvantage and may reduce flexibility in responding to changing business and economic conditions, including increased competition.

In addition, the terms of our senior credit facilities may restrict us from taking actions, such as making acquisitions or dispositions or entering into certain agreements, that we might believe to be advantageous to us.

The historical financial information of Old FIS may not be representative of its results as a consolidated, stand-alone company and may not be a reliable indicator of its future results as part of our combined company.

The historical financial statements of Old FIS, incorporated by reference in this prospectus, may not be indicative of its future performance as a consolidated part of our combined company.  Old FIS made numerous and large acquisitions before our business combination, the largest of which was its acquisition of Fidelity Information Services, Inc., or FI, in 2003.  These acquired businesses are not included in the historical financial statements of Old FIS prior to their acquisition and, once included, make comparisons of different periods in Old FIS’ historical financial statements difficult.  For example, the FI acquisition makes the 2003 historical results of operations of Old FIS in many respects not comparable to prior periods.

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Further, the historical financial statements of Old FIS do not reflect operations as a separate stand-alone entity for the historical periods presented prior to March 9, 2005, the date on which Old FIS engaged in a private placement of a minority interest in its common stock and was no longer a wholly owned subsidiary of FNF.  Because prior to that date Old FIS’ businesses were either wholly owned subsidiaries of FNF, or were operated as divisions of wholly owned subsidiaries of FNF, Old FIS’ historical financial statements prior to that date include assets, liabilities, revenues and expenses directly attributable to its operations and allocations to Old FIS of certain corporate expenses of FNF.  These expenses for corporate services, which include expenses for general management, accounting, finance, legal, payroll, human resources, internal audit and mergers and acquisitions, were allocated to Old FIS on the basis that management considered to reflect most fairly or reasonably the utilization of the services provided to or the benefit obtained by businesses constituting Old FIS.  The corporate expenses allocated to Old FIS may be different from the amounts of expenses Old FIS would have incurred if it had been a stand-alone company and had performed those services itself or procured them from third parties or from FNF under the services agreements Old FIS entered into with FNF in connection with the March 9, 2005 closing of the minority interest sale.

Further, Old FIS’ historical financial statements do not reflect the debt or interest expense Old FIS might have incurred if it had been a stand-alone entity.  Some of the costs of FNF allocated to Old FIS may incorporate more advantageous pricing available to an entity with the scale and purchasing power of FNF than would have been available to Old FIS as a stand-alone entity.  In addition, Old FIS’ historical financial statements do not reflect reporting and compliance costs it would have incurred if it had been a separate publicly traded company.  As a result of these and other factors, Old FIS’ historical financial statements do not necessarily reflect what its financial position and results of operations would have been if it had been operated as a stand-alone public entity during the periods covered, and may not be indicative of future results of operations or financial position as part of our combined company.

We may not be able to successfully integrate the businesses of Certegy and Old FIS.

The success of our recently completed business combination will depend in large part upon our ability to integrate the organizations, operations, systems and personnel of Old FIS and Certegy.  The integration of two previously independent companies is a challenging, time-consuming and costly process.  It is possible that the integration process could result in the loss of key employees, the disruption of each company’s ongoing businesses or inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain relationships with suppliers, customers and employees or to achieve the anticipated benefits of the business combination.  In addition, successful integration of the companies will require the dedication of significant management resources, which will temporarily detract attention from our day-to-day businesses.  If management is not able to integrate the organizations, operations, systems and personnel of Old FIS and Certegy in a timely and efficient manner, the anticipated benefits of the business combination may not be realized fully or at all or may take longer to realize than expected.

Failure to achieve expected synergies could result in the benefits of the business combination not being attained.

We expect that our recently completed business combination will result in beneficial synergies for us and our subsidiaries.  Achieving these anticipated synergies, however, will depend on a number of factors, some of which include:

•                                           retention of key management, marketing and technical personnel;

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•                                           correctly identifying areas where personnel and facilities can be consolidated without adverse effects on results of operations;

•                                           customers not deferring purchasing decisions as a result of the business combination;

The failure to achieve anticipated synergies could result in a failure to attain expected benefits to our combined business, financial condition and operating results.

Our failure to successfully cross-sell products and services to our existing customer bases could result in the full potential benefits of the business combination not being achieved.

While we intend to take advantage of the business combination to seek cross-selling opportunities, such cross-selling efforts may face potential challenges for various reasons, such as difficulties in coordinating and incentivizing employees within one combined company and maintaining optimal quality control, managing existing customers’ potential resistance to outsourcing functions to a new vendor and other matters.  If the cross-selling synergies for increased revenue do not occur, the benefits of the business combination may not be achieved.

If FNF engages in the same types of businesses we conduct, our ability to successfully operate and expand our business may be limited.

Under the shareholders agreement entered into in connection with our business combination, FNF agreed, and agreed to cause FNT and certain of its other affiliates to agree, not to compete with us in certain significant lines of business.  However, these restrictions do not cover certain other lines of business in which we will operate, such as title agency services.  Our lender services business provides centralized title agency services to large national lenders, and our revenues for 2004 from this business were $92.2 million.  Through its FNT operations, FNF provides similar national title agency services.  Further, although we have agreed to place all title insurance business our lender services generate with FNT’s title insurers, the latter are free to deal with other third party title agents.

As previously noted, certain of our officers and directors are subject to conflicts of interest with respect to our business activities which compete with FNF, FNT or any of their respective subsidiaries.  In addition, due to the significant resources of FNF, including financial resources, FNF could have a significant competitive advantage over us if and when we compete with them, which could have an adverse effect on our financial condition and results of operations.

Sales of our shares by selling shareholders could adversely affect the trading price of our shares.

In connection with the business combination, we entered into a registration rights agreement with FNF and the other former stockholders of Old FIS requiring us, under certain circumstances, to register all of the 127,919,995 shares of our common stock that are now beneficially owned by them.  The exercise of these registration rights, or sales by FNF or the other former stockholders of Old FIS in the public market pursuant to any such registration, could adversely affect the market price of our common stock.

This registration statement registers for resale from time to time all of the shares of our common stock held by former stockholders of Old FIS, other than FNF, which shares collectively account for approximately 16.7% of our shares after the merger.  Sales of these shares, or the possibility that sales of

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these shares may occur in unlimited amounts and without prior notice under this registration statement, could adversely affect the trading price of our shares.

The issuance of shares under our stock incentive plans will dilute your ownership interest.

Under our amended and restated stock incentive plan, we are permitted to issue up to approximately 12.1 million shares (not including shares previously issued under the plan), which is 6 million more shares than could be issued under the prior plan.  We issued to Lee A. Kennedy, our President and Chief Executive Officer and a member of our board of directors, and Jeffrey S. Carbiener, our Executive Vice President and Chief Financial Officer, an aggregate of 1.1 million shares under the plan upon the consummation of the business combination, and we made stock option grants to other officers as consideration for such officers remaining employed by us and canceling their change in control agreements in connection with the business combination.  Additionally, in connection with the business combination, we assumed Old FIS’ 2005 Stock Incentive Plan, pursuant to which an aggregate of 10,371,892 shares of our common stock may be issued under existing or future awards.  The issuance of shares pursuant to these or other awards under these stock incentive plans will dilute your ownership interest in our common stock.

Risks Related to Our Business

If we fail to adapt our services to changes in technology or in the marketplace, or if our ongoing efforts to upgrade our technology are not successful, we could lose customers and have difficulty attracting new customers for our products and services.

The markets for our services are characterized by constant technological changes, frequent introductions of new services and evolving industry standards.  Our future success will be significantly affected by our ability to enhance our current products and services, and develop and introduce new products and services that address the increasingly sophisticated needs of our customers and their clients.  These initiatives carry the risks associated with any new product or service development effort, including cost overruns, delays in delivery and performance issues.  There can be no assurance that we will be successful in developing, marketing and selling new products and services that meet these changing demands, that we will not experience difficulties that could delay or prevent the successful development, introduction and marketing of these products and services or that our new products and services and their enhancements will adequately meet the demands of the marketplace and achieve market acceptance.

For example, the specific products and services that we deliver to the electronic payments market are designed to process transactions and deliver reports and other information on those transactions at very high volumes and processing speeds.  Any performance issue that arises with a new product or service could result in significant processing or reporting errors.  As a result of these factors, our research and development efforts could result in increased costs that could reduce our revenues and operating income if new products are not delivered timely to our customers, or a loss of revenue, or possible claims for damages if new products and services do not perform as anticipated.

Additionally, we currently are engaged in significant efforts to upgrade two of our most important applications:  our core bank processing software and our mortgage processing software.  These applications were acquired upon our acquisition of FI from Alltel Information Services, Inc. in 2003.  We spent the period immediately following the acquisition discussing with key customers the changes that they would like to see made in those products.  In 2004, we began the development work to implement changes required to keep pace with the marketplace and the requirements of our customers.  Including amounts already spent, we expect to spend approximately $60.0 million on the development of our mortgage servicing platform.  With respect to the core banking software, during 2005 we spent

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approximately $56.0 million on enhancement and integration projects, and during 2006 we expect to spend approximately $55.0 million on such projects.  If we are unsuccessful in completing or gaining market acceptance of these and other upgrade efforts, it would likely have a material adverse effect on our ability to retain existing customers or attract new ones.

We operate in a competitive business environment, and if we are unable to compete effectively our results of operations and financial condition may be adversely affected.

The market for our services is intensely competitive.  Our competitors vary in size and in the scope and breadth of the services they offer.  Some of our competitors have substantial resources.  We face direct competition from third parties, and since many of our larger potential customers have historically developed their key applications in-house and therefore view their system requirements from a make-versus-buy perspective, we often compete against our potential customers’ in-house capacities.  In addition, we expect that the markets in which we compete will continue to attract new competitors and new technologies.  There can be no assurance that we will be able to compete successfully against current or future competitors or that competitive pressures we face in the markets in which we operate will not materially adversely affect our business, financial condition and results of operations.

If we are unable to successfully consummate and integrate acquisitions, our results of operations may be adversely affected.

As part of our growth strategy, we have made numerous acquisitions in recent years.  We anticipate that we will continue to seek to acquire complementary businesses, products and services.  This strategy will depend on the ability to find suitable acquisitions and finance them on acceptable terms.  We may require additional debt or equity financing for future acquisitions, and doing so will be made more difficult by our substantial debt.  If we are unable to acquire suitable acquisition candidates, we may experience slower growth.

Further, even if we successfully complete acquisitions, we will face challenges in integrating any acquired business.  These challenges include eliminating redundant operations, facilities and systems, coordinating management and personnel, retaining key employees, managing different corporate cultures and achieving cost reductions and cross-selling opportunities.  There can be no assurance that we will be able to fully integrate all aspects of acquired businesses successfully or fully realize the potential benefits of bringing them together, and the process of integrating these acquisitions may disrupt our business and divert our resources.

In connection with the audit of the 2004 financial statements of Old FIS, two material weaknesses in internal controls were identified.  If management or our auditors identify any material weaknesses in its internal control over financial reporting in the future, such finding could result in a loss of investor confidence in our financial reports and lead to a substantial stock price decline.

Each year, management and our auditors are required to evaluate our internal control over financial reporting.  And, in the future, we will be required under Section 404 of the Sarbanes-Oxley Act of 2002 to furnish a report by our management on our internal control over financial reporting that includes Old FIS’ internal control over financial reporting.  Before the business combination, Old FIS was not subject to this requirement on a stand-alone basis.

In connection with FNF’s Section 404 assessment and the audit of Old FIS’ 2004 financial statements, two matters that constituted material weaknesses in the design and operation of Old FIS’ internal control over financial reporting were identified.  In general, a material weakness is defined as a

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control deficiency, or combination of control deficiencies, that results in more than a remote likelihood that a material misstatement of annual or interim financial statements will not be prevented or detected.

The two material weaknesses identified were as follows.  First, with respect to revenue recognition, it was determined that Old FIS did not have a sufficiently robust process in place for identifying which contracts of its financial institutions software and services business should be formally reviewed for appropriate revenue recognition.  Old FIS also did not have a formal process in place to establish documentary support for the fair value or vendor specific objective evidence of its various products on an ongoing basis.  Secondly, it was determined that Old FIS did not have adequate controls in place to ensure that purchase accounting for business acquisitions was appropriately recorded in a timely manner.  These matters did not constitute material weaknesses with respect to FNF on a consolidated basis.

In response, in late 2004 and early 2005, Old FIS made changes in its controls that were designed to substantially remediate these issues.  We intend to take further steps, although the principal changes have been made.  Although management believes that these matters no longer constitute material weaknesses, if we or our auditors in the future determine that one or both of these matters still constitutes a material weakness, or that one or more other matters constitutes a material weakness, such event could cause investors to lose confidence in the accuracy and completeness of our financial reports, which could lead to a substantial stock price decline.

If we were to lose any of our largest customers, our results of operations could be significantly affected.

A small number of customers has accounted for a significant portion of our revenues, and we expect that a limited number of customers will continue to represent a significant portion of our revenues for the foreseeable future.  In 2004, one customer accounted for $139.0 million, or approximately 6.0%, of the total revenues of Old FIS, including $58.3 million, or 31.0%, of the revenues of its lender services business, due primarily to its use of Old FIS’ automated process for performing title agency services in a period of relatively high refinancing activity.  For the nine months ended September 30, 2005, this customer accounted for $88.2 million, or 4.3%, of Old FIS’ total revenues, including $23.2 million, or 18.6%, of the revenues in its lender services business.  This customer is a party to several agreements with us covering services provided by different businesses of ours.  Each agreement has different termination terms and dates.  This customer’s contract with our lender services business is terminable without penalty by either party on 60 days notice.

In addition, in 2004 there were two other customers that accounted for $26.7 million and $14.6 million, or approximately 14.2% and 7.8%, respectively, of the revenues in Old FIS’ lender services business, one of which also accounted for $46.4 million, or approximately 20%, of the revenues of Old FIS’ default services business.  For the nine months ended September 30, 2005, these two customers accounted for $22.1 million and $14.2 million, or approximately 17.8% and 11.4%, respectively, of the revenues of Old FIS’ lender services business, and one of them accounted for approximately $39.6 million, or 23%, of the revenues of Old FIS’ default services business.  The larger of these customers has an agreement with our lender services business that is terminable without penalty by either party at any time and two agreements with our default services business covering different services, each of which is terminable without penalty on 180 days notice.  The other customer’s agreement with our lender services business is terminable without penalty by either party on 45 days notice.

We also have long-term contractual alliances with two associations representing independent financial institutions in the U.S., the Independent Community Bankers of America, or ICBA, and Card Services for Credit Unions, or CSCU.  Under these alliances, which expire in 2008 and 2009, respectively, we are the associations’ exclusive partner for offering credit card issuer and merchant

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institution processing services to those associations’ members.  We are also the exclusive partner of CSCU for offering debit card processing to its members.  As a result, approximately 24.1% of Certegy’s consolidated revenues in 2004 were derived from their member institutions.  An early termination of, or significant adverse change in, our relationships with either or both of these associations could harm our ability to retain a substantial portion of our customers and to attract new customers, which would have a material adverse effect on our business.

Our relationships with these and other large customers are important to our future operating results, and deterioration in any of those relationships could significantly reduce our revenues.  Other than contracts with our financial information software and services business, most of our customer agreements are terminable by either party on relatively short notice.

Decreased lending and real estate activity may reduce demand for certain of our services and adversely affect our results of operations.

Revenues from information services and lender services operations are closely related to the general level of real estate transactions, such as real estate sales and mortgage refinancings.  Real estate sales are affected by a number of factors, including mortgage interest rates, the availability of funds to finance purchases and general economic conditions.  Prevailing mortgage interest declined to record lows in recent years, and the volume of real estate transactions experienced record highs.  However, these trends did not continue, and the volume of refinancing transactions in particular and mortgage originations in general declined in 2004 and again in 2005 from 2003 levels, resulting in reduction of revenues in some of our businesses.  Some of our services and related applications, including our automated title agent process that accounted for substantial revenues from our lender services operations in 2003, are currently used exclusively for refinancing transactions.  Our revenues in future periods will continue to be subject to these and other factors which are beyond our control and, as a result, are likely to fluctuate.

Our revenues from the sale of services to VISA and MasterCard organizations are dependent upon our continued VISA and MasterCard certification and financial institution sponsorship, and the loss or suspension of this certification or sponsorship could adversely affect our business.

In order to provide our transaction processing services, we must be designated a certified processor by, and be a member service provider of, MasterCard and be designated as an independent sales organization of VISA.  These designations are dependent upon our continuing adherence to the standards of the VISA and MasterCard associations.  The member financial institutions of VISA and MasterCard, some of which are our competitors, set the standards with which we must comply.  If we fail to comply with these standards, our designation as a certified processor, as a member service provider, or as an independent sales organization could be suspended or terminated.  The termination of our member service provider status or our status as a certified processor, or any changes in the VISA and MasterCard rules that prevent our registration or otherwise limit our ability to provide transaction processing and marketing services for the VISA or MasterCard organizations would result in the loss of business from VISA or MasterCard issuing customers, and lead to a reduction in our revenues, which would have a material adverse effect on our business.

Consolidation in the banking and financial services industry could adversely affect our revenues by eliminating some of our existing and potential customers and could make us more dependent on a more limited number of customers.

There has been and continues to be substantial merger, acquisition and consolidation activity in the banking and financial services industry.  Mergers or consolidations of banks and financial institutions in the future could reduce the number of our customers and potential customers, which could adversely

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affect our revenues even if these events do not reduce the aggregate number of customers or the banking and other activities of the consolidated entities.  If our customers merge with or are acquired by other entities that are not our customers, or that use fewer of our services, they may discontinue or reduce their use of our services.  In addition, it is possible that the larger banks or financial institutions resulting from mergers or consolidations could decide to perform in-house some or all of the services which we currently provide or could provide.  Any of these developments could have a material adverse effect on our business and results of operations.

A continued decline in check writing could adversely impact the profits of our check services business.

We believe check writing has begun to decline as a total percentage of point-of-sale payments due, in part, to the growing use of debit and credit cards.  This decline has resulted in a higher percentage of bad checks at the point of sale because more higher credit quality customers are paying with credit and debit cards.  Accordingly, the demand for our check services by retailers and other vendors has increased at the same time as check writing percentages have declined.  To date, this increased demand has offset the adverse effect of the decline in the percentage of payments by check.  However, it is not likely that continued and prolonged declines in check writing can be offset by increased demands for services.  Consequently, a prolonged continuation of the decline in check writing could lead to a negative impact on the profitability of our check services business.

Many of our customers are subject to a regulatory environment and to industry standards that may change in a manner that reduces the number of transactions in which our customers engage and therefore reduces our revenues.

Our customers are subject to a number of government regulations and industry standards with which our products and services must comply.  For example, our products are affected by VISA and MasterCard electronic payment standards that are generally updated twice annually.  In addition, action by regulatory authorities relating to credit availability, data usage, privacy or other related regulatory developments could have an adverse effect on our customers and therefore could have a material adverse effect on our business, financial condition and results of operations.

Demand for many of our products and services is sensitive to the level of consumer transactions generated by our customers, and accordingly, our revenues could be impacted negatively by a general economic slowdown or any other event causing a material slowing of consumer spending.

A significant portion of our revenue is derived from transaction processing fees.  Any changes in economic factors that adversely affect consumer spending and related consumer debt, or a reduction in credit and debit card use, could reduce the volume of transactions that we process, and have an adverse effect on our business, financial condition and results of operations.

Potential customers of our financial information software and services business may be reluctant to switch to a new vendor, which may adversely affect our growth, both in the U.S. and internationally.

For banks and other potential customers of our financial information software and services segment, switching from one vendor of bank core processing or related software and services (or from an internally-developed system) to a new vendor is a significant undertaking.  Many potential customers worry about potential disadvantages such as loss of accustomed functionality, increased costs and business disruption.  As a result, potential customers, both in the U.S. and internationally, often resist change.  We seek to overcome this resistance through strategies such as making investments to enhance the functionality of its software.  However, there can be no assurance that our strategies for overcoming

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potential customers’ reluctance to change vendors will be successful, and this resistance may adversely affect our growth, both in the U.S. and internationally.

We have a long sales cycle for many of our applications and if we fail to close sales after expending significant time and resources to do so, our business, financial condition and results of operations may be adversely affected.

The implementation of many of our applications often involves significant capital commitments by our customers, particularly those with smaller operational scale.  Potential customers generally commit significant resources to an evaluation of available software and require us to expend substantial time, effort, and money educating them as to the value of our software and services.  We incur substantial costs in order to obtain each new customer.  We may expend significant funds and management resources during the sales cycle and ultimately fail to close the sale.  Our sales cycle may be extended due to our customers’ budgetary constraints or for other reasons.  If we are unsuccessful in closing sales after expending significant funds and management resources or we experience delays, it could have a material adverse effect on our business, financial condition and results of operations.

To continue to grow our card issuer business profitably, we must expand our share of the credit and debit card transaction processing market and enter new markets, and the failure to do this could adversely affect our business.

Our domestic card issuer business is concentrated in the independent community bank and credit union segments of the market, and we have achieved a significant degree of penetration of these market segments.  While we intend to continue our vigorous pursuit of expansion within these segments, future growth and profitability of this business will significantly depend upon our ability to penetrate other markets, including emerging markets for electronic transaction processing, such as international transaction processing and Internet payment systems.  As part of our strategy to achieve this expansion, we will continue to seek acquisition opportunities, investments and alliance relationships that will facilitate our expansion; however, we may not be able to complete suitable acquisitions, investments or alliances, and if we do, they may not provide us with the benefits we anticipated.  Also, we may not have adequate financial and technological resources to develop products and distribution channels that will satisfy the demands of new markets.

We may experience software defects, development delays and installation difficulties, which would harm our business and reputation and expose us to potential liability.

Many of our services are based on sophisticated software and computing systems, and we may encounter delays when developing new applications and services.  Further, the software underlying our services has occasionally contained and may in the future contain undetected errors or defects when first introduced or when new versions are released.  In addition, we may experience difficulties in installing or integrating our technologies on platforms used by our customers.  Defects in our software, errors or delays in the processing of electronic transactions, or other difficulties could result in:

•                                           interruption of business operations;

•                                           delay in market acceptance;

•                                           additional development and remediation costs;

•                                           diversion of technical and other resources;

•                                           loss of customers;

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•                                           negative publicity; or

•                                           exposure to liability claims.

Although we attempt to limit our potential liability through disclaimers and limitation-of-liability provisions in its license and customer agreements, we cannot be certain that these measures will be successful in limiting our liability.

Security breaches or computer viruses could harm our business by disrupting our delivery of services and damaging our reputation.

As part of our transaction processing business, we electronically receive, process, store and transmit sensitive business information of our customers.  In addition, we collect personal consumer data, such as names and addresses, social security numbers, driver’s license numbers, checking and savings account numbers and payment history records.  Unauthorized access to our computer systems or databases could result in the theft or publication of confidential information or the deletion or modification of records or could otherwise cause interruptions in our operations.  These concerns about security are increased when we transmit information over the Internet.  Computer viruses have also been distributed and have rapidly spread over the Internet.  Computer viruses could infiltrate our systems, disrupting our delivery of services and making our applications unavailable.  Any inability to prevent security breaches or computer viruses could also cause existing customers to lose confidence in our systems and terminate their agreements with us, and could inhibit our ability to attract new customers.

If we fail to comply with privacy regulations imposed on providers of services to financial institutions, our business could be harmed.

As a provider of services to financial institutions, we are bound by the same limitations on disclosure of the information we receive from our customers as apply to the financial institutions themselves.  If we fail to comply with these regulations, we could be exposed to suits for breach of contract or to governmental proceedings, our customer relationships and reputation could be harmed, and we could be inhibited in our ability to obtain new customers.  In addition, if more restrictive privacy laws or rules are adopted in the future on the federal or state level, or, with respect to our international operations, by authorities in foreign jurisdictions on the national, provincial, state or other level, that could have an adverse impact on us.

If we experience system failures, the products and services we provide to our customers could be delayed or interrupted, which could harm our business and reputation and result in the loss of customers.

Our ability to provide reliable service in a number of our businesses depends on the efficient and uninterrupted operations of our computer network systems and data centers.  Our systems and operations could be exposed to damage or interruption from fire, natural disaster, power loss, telecommunications failure, unauthorized entry and computer viruses.  Although we have taken steps to prevent system failures, we cannot be certain that our measures will be successful.  Further, our property and business interruption insurance may not be adequate to compensate us for all losses or failures that may occur.  Any significant interruptions could:

•                                           increase our operating expenses to correct problems caused by the interruption;

•                                           harm our business and reputation;

•                                           result in a loss of customers; or

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•                                           expose us to liability.

Any one or more of the foregoing occurrences could have a material adverse effect on our business, financial condition, and results of operations.

We face liability to our merchant customers if checks that we have guaranteed are dishonored by the check writer’s bank.

If a check that we have guaranteed is dishonored by the check writer’s bank, we must reimburse our merchant customer for the check’s face value and pursue collection of the amount from the delinquent check writer.  In some cases, we recognize a liability to our merchant customers for estimated check returns and a receivable for amounts we estimate we will recover from the check writers, based on historical experience and other relevant factors.  The estimated check returns and recovery amounts are subject to the risk that actual amounts returned may exceed our estimates and actual amounts recovered may be less than our estimates.

Our outsourcing of key development functions overseas may lead to quality control issues that affect our business operations.

By outsourcing development functions overseas, we may experience quality control issues in our applications offered to our markets.  Overseas outsourcing operations are subject to risk of quality control deficiencies due to the physical distance from our headquarters, the increased potential for instructions and guidance to be misunderstood, a lack of direct institutional control and the time and expense it will take to provide on site training.  Any one of these factors make it more difficult for us to maintain quality control, and the potential for quality control issues may impact our ability to maintain and or increase our customer base.

Misappropriation of our intellectual property and proprietary rights could impair our competitive position.

Our ability to compete depends upon proprietary systems and technology.  Despite our efforts to protect our proprietary rights, unauthorized parties may attempt to copy aspects of our services or to obtain and use information that we regard as proprietary.  Policing unauthorized use of our proprietary rights is difficult.  We cannot make any assurances that the steps we have taken will prevent misappropriation of technology or that the agreements entered into for that purpose will be enforceable.  Effective trademark, service mark, copyright and trade secret protection may not be available in every country in which our applications and services are made available online.  Misappropriation of our intellectual property or potential litigation concerning such matters could have a material adverse effect on our results of operations or financial condition.

If our applications or services are found to infringe the proprietary rights of others, we may be required to change our business practices and may also become subject to significant costs and monetary penalties.

As our information technology applications and services develop, we may become increasingly subject to infringement claims.  Any claims, whether with or without merit, could:

•                                           be expensive and time-consuming to defend;

•                                           cause us to cease making, licensing or using applications that incorporate the challenged intellectual property;

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•                                           require us to redesign our applications, if feasible;

•                                           divert management’s attention and resources; and

•                                           require us to enter into royalty or licensing agreements in order to obtain the right to use necessary technologies.

There can be no assurance that third parties will not assert infringement claims against us in the future with respect to our current or future applications and services.

We may not succeed with our current and future expansion of our international operations and such failure may adversely affect our growth and results of operations.

In 2004, sales outside of the U.S. represented approximately 5.7% of the revenues of Old FIS.  In 2004, Old FIS acquired Sanchez Computer Associates, Inc., or Sanchez, and a controlling interest in Kordoba GmbH & Co. KG, or Kordoba, in part in order to expand its international operations, particularly in the financial institution software and services business.  On September 30, 2005, Old FIS acquired all of the remaining outstanding equity interests in Kordoba.  Additionally, approximately 15.8% of the consolidated revenues of Certegy for the year ended December 31, 2004 and 37.3% of Certegy’s consolidated assets at December 31, 2004 are associated with operations outside of the U.S.

We believe there are additional opportunities to expand our international operations, and we expect to commit significant resources to expand our international sales and marketing activities.  However, overall we are less well-known internationally than in the United States and have less experience with local business conditions.  In addition, we will face challenges in successfully managing small operations located far from our headquarters, because of the greater difficulty in overseeing and guiding operations from a distance, and we will be increasingly subject to a number of other risks and potential costs, including:

•                                           political and economic instability;

•                                           unexpected changes in regulatory requirements and policy, the adoption of laws detrimental to our operations such as legislation relating to the collection of personal data over the Internet or the adoption of laws, regulations or treaties governing the export of encryption related software;

•                                           the burdens of complying with a wide variety of other laws and regulations;

•                                           failure to adequately manage currency exchange rate fluctuations;

•                                           potentially adverse tax consequences, including restrictions on the repatriation of earnings;

•                                           potential difficulty of enforcing agreements and collecting receivables in some foreign legal systems; and

•                                           general economic conditions in international markets.

There can be no assurance that we will be able to compete successfully against current or future international competitors or that our relative inexperience with international operations will not limit or hinder our success.

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Foreign currency fluctuations may adversely affect us.

Because of our foreign operations, the U.S. dollar balance sheets and statements of income for many of our businesses are subject to currency fluctuations.  We are most vulnerable to fluctuations in the Brazilian real and the British pound against the U.S. dollar.  The cumulative translation adjustment, largely related to our investment in our Brazilian card processing operation, was a $58.6 million and $75.1 million reduction of shareholders’ equity at December 31, 2004 and 2003, respectively.

Economic conditions in Brazil could adversely affect our Brazilian operations.

Economic conditions in Brazil are uncertain, which has created currency volatility and a major devaluation in the past, resulting in severe inflationary pressures.  In addition, significant changes in bank ownership, as large private banks acquire smaller regional banks and foreign global banks acquire Brazilian banks, could result in the loss of customers.  These conditions make it challenging for us to develop our business and generate revenues in Brazil.

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