Equifax 2008 Annual Report Download - page 69

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The assets in these plans are subject to creditors claims in 11. RELATED PARTY TRANSACTIONS
case of insolvency of Equifax Inc.
SunTrust Banks, Inc., or SunTrust
10. RESTRUCTURING CHARGES We consider SunTrust a related party because L. Phillip
Humann, a member of our Board of Directors, was Execu-
2008 Restructuring and Asset Write-down Charges. In tive Chairman of the Board of Directors of SunTrust
the third quarter 2008, we realigned our business to better Banks, Inc., a multi-bank holding company, from 2007 to
support our strategic objectives in the current economic April 2008 and prior thereto, Chairman and Chief Executive
environment. These actions were designed to reduce and Officer from 2004 through 2006. Larry L. Prince, a member
manage our expenses and to preserve our financial results, of our Board of Directors until September 18, 2008, was
while enabling us to allocate resources to pursue key stra- also a director of SunTrust. Our relationships with SunTrust
tegic objectives. As a result, we recorded a $16.8 million are described more fully as follows:
restructuring and asset write-down charge ($10.5 million, • We paid SunTrust $4.1 million, $4.2 million and $3.1 mil-
net of tax) of which $14.4 million was recorded in selling, lion, respectively, during the twelve months ended
general and administrative expenses and $2.4 million December 31, 2008, 2007 and 2006 for services such
recorded in depreciation and amortization on our Consoli- as lending, foreign exchange, debt underwriting, cash
dated Statement of Income. The $2.4 million recorded in management, trust, investment management, acquisition
depreciation and amortization is related to the write-down valuation, and shareholder services relationships.
of certain internal-use software from which we will no • We also provide credit management services to Sun-
longer derive future benefit. Trust, as a customer, from whom we recognized revenue
of $6.6 million, $6.0 million and $4.9 million, respectively,
Of the $14.4 million recorded in selling, general and admin-
during the twelve months ended December 31, 2008,
istrative expenses, $10.3 million is associated with
2007 and 2006. The corresponding outstanding
headcount reductions of approximately 300 positions,
accounts receivable balances due from SunTrust at
which was accrued for under existing severance plans or
December 31, 2008 and 2007 were immaterial.
statutory requirements, and $4.1 million is related to certain
• We have an $850.0 million Senior Credit Facility with a
contractual costs. Generally, severance benefits paid to our
group of banks, of which SunTrust is committed to lend
U.S. employees are paid through monthly payroll according
$115.0 million. At December 31, 2008 and 2007, Sun-
to the number of weeks of severance benefit provided to
Trust’s portion of the outstanding borrowings under this
the employee, while our international employees receive a
facility totaled $56.8 million and $50.7 million,
lump sum severance payment for their benefit. Accordingly,
respectively.
we expect the majority of the payments related to
• SunTrust is the holder of our $10.1 million mortgage obli-
headcount reductions to be completed by the first quarter
gation on the facility that houses our Atlanta, Georgia
of 2009. A majority of the certain contractual costs, which
data center, which we acquired on July 26, 2007.
primarily represents services we do not intend to utilize for
• SunTrust provides the $29.0 million synthetic lease facility
which we are contractually committed to future payments,
related to our Atlanta corporate headquarters building.
are expected to be paid by 2011. The payments related to
As of December 31, 2008 and 2007, the amount of this
these charges totaled $6.5 million during the twelve
facility was $29.0 million.
months ended December 31, 2008, the majority of which
• A subsidiary of SunTrust, AMA/Lighthouse, Inc., owned a
related to the headcount reductions.
24.9% minority interest in Lighthouse Investment Part-
2006 Restructuring Charges. During the fourth quarter of ners, L.L.C., which provides investment management
2006, we approved a plan for certain organizational services for our USRIP; SunTrust sold its minority interest
changes, effective January 1, 2007. This plan provided for in January 2008. As of December 31, 2007, a total of
the realignment of our operations, resulting in the elimina- $30.1 million of USRIP assets were managed by this
tion of approximately 170 positions, with expected pay- subsidiary of SunTrust.
ments totaling $6.4 million, pre-tax, and $4.0 million, net of • SunTrust is a dealer under our commercial paper pro-
tax. The severance liabilities were recognized in 2006 as gram. Fees paid to the dealers related to our issuance of
payment was probable and estimable under existing plans. commercial paper were immaterial during the twelve
The realignment activities provided for by this plan were months ended December 31, 2008 and 2007.
substantially complete at December 31, 2007. • SunTrust Robinson Humphrey served as an underwriter
for our public offering of $550.0 million of Notes in June
2007 for which they were paid underwriting fees of
approximately $0.4 million.
2008 ANNUAL REPORT 67