Equifax 2010 Annual Report Download - page 69

11. RESTRUCTURING CHARGES
2009 Restructuring Charges. In the fourth quarter of 2009, we
recorded a $16.4 million restructuring charge ($10.4 million, net of
tax) in selling, general and administrative expenses on our
Consolidated Statements of Income primarily related to headcount
reductions of approximately 400 positions. This charge resulted from
our continuing efforts to align our business to better support our
strategic objectives. Generally, severance benefits for our U.S.
employees are paid through monthly payroll according to the number
of weeks of severance benefit provided to the employee, while our
international employees receive a lump sum severance payment for
their benefit. Payments related to this charge totaled $10.4 million for
the twelve months ended December 31, 2010. Total payments to
date, through December 31, 2010, related to the fourth quarter 2009
restructuring charge were $12.1 million.
During the first quarter of 2009, we recorded in selling, general and
administrative expenses in our Consolidated Statements of Income
an $8.4 million restructuring charge ($5.4 million, net of tax) associ-
ated with headcount reductions of approximately 300 positions. This
charge resulted from our efforts to reduce and manage our expenses
and to maintain our financial results in the face of a weak global
economy and reduced revenues. Payments related to this charge
were not material during the twelve months ended December 31,
2010. Total payments related to the first quarter 2009 restructuring
charge were $8.0 million.
2008 Restructuring and Asset Write-down Charges. In the third
quarter 2008, we realigned our business to better support our
strategic objectives and recorded a $16.8 million restructuring and
asset write-down charge ($10.5 million, net of tax) of which
$14.4 million was recorded in selling, general and administrative
expenses and $2.4 million was recorded in depreciation and
amortization on our Consolidated Statements of Income. The
$2.4 million recorded in depreciation and amortization is related to
the write-down of certain internal-use software from which we will
no longer derive future benefit.
Of the $14.4 million recorded in selling, general and administrative
expenses, $10.3 million was associated with headcount reductions
of approximately 300 positions which was accrued for under existing
severance plans or statutory requirements, and $4.1 million was
related to certain contractual costs. Payments related to headcount
reductions were substantially completed by March 31, 2009.
Substantially all of the certain contractual costs, which primarily
represents services we do not intend to utilize for which we are
contractually committed to future payments, are expected to be
paid by 2011. Payments related to headcount reductions and certain
contractual costs were not material for the twelve months ended
December 31, 2010, and totaled $5.4 million for the twelve months
ended December 31, 2009. Total payments, through December 31,
2010, related to the third quarter 2008 restructuring charge were
$12.7 million.
Restructuring charges are recorded in general corporate expense.
Restructuring charges related to discontinued operations were
$4.1 million and $0.8 million during 2009 and 2008, respectively.
12. RELATED PARTY TRANSACTIONS
SunTrust Banks, Inc., or SunTrust
We considered SunTrust a related party until September 18, 2008,
because Larry L. Prince, a member of our Board of Directors until
that date, was also a director of SunTrust. L. Phillip Humann, a
member of our Board of Directors, was Executive Chairman of
the Board of Directors of SunTrust from 2007 to April 2008 and
prior thereto, Chairman and Chief Executive Officer from 2004
through 2006. Our relationships with SunTrust are described
more fully as follows:
• We paid SunTrust $4.1 million during the twelve months ended
December 31, 2008 for services such as lending, foreign
exchange, debt underwriting, cash management, trust, invest-
ment management, acquisition valuation, and shareholder
services relationships.
• We also provide credit management services to SunTrust, as
a customer, from whom we recognized revenue of $6.6 million
during the twelve months ended December 31, 2008.
• SunTrust is a dealer under our commercial paper program.
Fees paid to the dealers related to our issuance of commercial
paper were immaterial during the twelve months ended
December 31, 2008.
Bank of America, N.A., or B of A
We considered B of A a related party until September 18, 2008,
because Jacquelyn M. Ward, a member of our Board of Directors
until that date, was also a director of B of A. Our relationships with
B of A are described more fully as follows:
• We provide credit management services to B of A, as a customer,
from whom we recognized revenue of $40.3 million during the
twelve months ended December 31, 2008.
• B of A is a dealer under our commercial paper program. Fees paid
to the dealers related to our issuance of commercial paper were
immaterial during the twelve months ended December 31, 2008.
EQUIFAX 2010 ANNUAL REPORT 67
67