Crawford & Company (CRD-B) 10-K 5 Mar 10 2009 FY Annual report Financial data

Document and Company Informatio

Document and Company Information (USD $)
	12 Months Ended Dec. 31, 2009	Jun. 30, 2009	Mar. 01, 2010 Class A common stock	Mar. 01, 2010 Class B common stock
Entity Registrant Name	CRAWFORD & CO
Entity Central Index Key	0000025475
Document Type	10-K
Document Period End Date	2009-12-31
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	No
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Accelerated Filer
Entity Public Float		$109,660,997
Entity Common Stock, Shares Outstanding			27,654,905	24,697,172

Consolidated Statements of Oper

Consolidated Statements of Operations (USD $)
In Thousands, except Per Share data	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Revenues from Services:
Revenues before reimbursements	$969,868	$1,048,582	$975,143
Reimbursements	78,334	87,334	76,135
Total Revenues	1,048,202	1,135,916	1,051,278
Costs and Expenses:
Costs of services provided, before reimbursements	713,991	767,093	733,240
Reimbursements	78,334	87,334	76,135
Total costs of services	792,325	854,427	809,375
Selling, general, and administrative expenses	209,458	218,632	211,654
Corporate interest expense, net of interest income of $1,063, $1,994, and $1,876, respectively	14,166	17,622	17,326
Goodwill and intangible asset impairment charges	140,945	0	0
Restructuring and other costs	4,059	3,300	0
Total Costs and Expenses	1,160,953	1,093,981	1,038,355
Gain on disposals of businesses	0	2,512	3,980
Gain on sale of assets	0	0	4,844
(Loss) Income Before Income Taxes	(112,751)	44,447	21,747
Provision for Income Taxes	2,618	11,564	5,396
Net (Loss) Income	(115,369)	32,883	16,351
Less: Net Income Attributable to Noncontrolling Interests	(314)	(624)	(235)
Net (Loss) Income Attributable to Crawford & Company	($115,683)	$32,259	$16,116
(Loss) Earnings Per Share:
Basic	-2.23	0.63	0.32
Diluted	-2.23	0.62	0.32
Weighted-Average Shares Used For:
Basic (Loss) Earnings Per Share	51,830	50,958	50,532
Diluted (Loss) Earnings Per Share	51,830	52,342	50,659
Cash Dividends Per Share:
Class A and Class B Common Stock	$0	$0	$0

1_Consolidated Statements of Op

Consolidated Statements of Operations (Parenthetical) (USD $)
In Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Costs and Expenses:
Interest income	$1,063	$1,994	$1,876

Consolidated Balance Sheets

Consolidated Balance Sheets (USD $)
In Thousands	Dec. 31, 2009	Dec. 31, 2008
Current Assets:
Cash and cash equivalents	$70,354	$73,124
Accounts receivable, less allowance for doubtful accounts of $11,983 and $12,341, respectively	139,215	157,430
Unbilled revenues, at estimated billable amounts	93,796	99,115
Prepaid expenses and other current assets	22,350	18,688
Total Current Assets	325,715	348,357
Property and Equipment:
Property and equipment	144,254	140,399
Less accumulated depreciation	(102,108)	(95,785)
Net Property and Equipment	42,146	44,614
Other Assets:
Goodwill	123,169	251,897
Intangible assets arising from business acquisitions, net	104,409	111,389
Capitalized software costs, net	50,463	46,296
Deferred income taxes	69,504	67,695
Other noncurrent assets	27,499	25,000
Total Other Assets	375,044	502,277
TOTAL ASSETS	742,905	895,248
Current Liabilities:
Short-term borrowings	32	13,366
Accounts payable	35,449	40,711
Accrued compensation and related costs	70,871	77,802
Self-insured risks	18,475	17,939
Income taxes payable	0	5,675
Deferred income taxes	0	4,262
Deferred rent	15,777	15,645
Other accrued liabilities	31,541	41,333
Deferred revenues	53,664	59,679
Mandatory company contributions due to pension plan	25,000	10,300
Current installments of long-term debt and capital leases	8,189	2,284
Total Current Liabilities	258,998	288,996
Noncurrent Liabilities:
Long-term debt and capital leases, less current installments	173,061	181,206
Deferred revenues	33,524	42,795
Self-insured risks	14,824	18,531
Accrued pension liabilities, less current mandatory contributions	187,507	169,242
Other noncurrent liabilities	13,705	14,119
Total Noncurrent Liabilities	422,621	425,893
Shareholders' Investment:
Additional paid-in capital	29,570	26,342
Retained earnings	140,463	256,146
Accumulated other comprehensive loss	(165,403)	(158,157)
Shareholders Investment attributable to shareholders of Crawford & Company	56,682	175,551
Noncontrolling interests	4,604	4,808
Total Shareholders' Investment	61,286	180,359
TOTAL LIABILITIES AND SHAREHOLDERS' INVESTMENT	742,905	895,248
Class A common stock
Shareholders' Investment:
Common Stock, value	27,355	26,523
Total Shareholders' Investment	27,355	26,523
Class B common stock
Shareholders' Investment:
Common Stock, value	24,697	24,697
Total Shareholders' Investment	$24,697	$24,697

Consolidated Balance Sheets (Pa

Consolidated Balance Sheets (Parenthetical) (USD $)
In Thousands	Dec. 31, 2009	Dec. 31, 2008
Current Assets:
Allowance for doubtful accounts	$11,983	$12,341
Class A common stock
Shareholders' Investment:
Common stock, par value	1	1
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	27,355	26,523
Common stock, shares outstanding	27,355	26,523
Class B common stock
Shareholders' Investment:
Common stock, par value	1	1
Common stock, shares authorized	50,000	50,000
Common stock, shares issued	24,697	24,697
Common stock, shares outstanding	24,697	24,697

Consolidated Statements of Cash

Consolidated Statements of Cash Flows (USD $)
In Thousands	12 Months Ended Dec. 31, 2009	12 Months Ended Dec. 31, 2008	12 Months Ended Dec. 31, 2007
Cash Flows from Operating Activities:
Net (Loss) Income	($115,369)	$32,883	$16,351
Reconciliation of net income to net cash provided by operating activities:
Goodwill and intangible asset impairment charges	140,945	0	0
Depreciation and amortization	31,010	30,331	29,646
Deferred income taxes	463	247	(1,437)
Stock-based compensation costs	5,510	5,858	2,929
Loss on disposals of property and equipment	117	195	554
Gains on sales of businesses	0	(2,512)	(3,980)
Gain on 2006 sale of former corporate headquarters	0	0	(4,844)
Changes in operating assets and liabilities, net of effects of acquisition and disposition:
Accounts receivable, net	27,193	6,785	12,450
Unbilled revenues, net	12,481	22,093	(11,298)
Prepaid or accrued income taxes	(7,782)	3,077	4,322
Accounts payable and accrued liabilities	(16,749)	20,493	(2,184)
Deferred revenues	(15,827)	(19,024)	(22,571)
Accrued retirement costs	(7,844)	(25,416)	2,188
Prepaid expenses and other operating activities	(2,484)	(3,425)	1,302
Net cash provided by operating activities	51,664	71,585	23,428
Cash Flows from Investing Activities:
Acquisitions of property and equipment	(9,886)	(15,214)	(16,129)
Capitalization of software costs	(14,823)	(16,797)	(11,980)
Proceeds from sales of businesses	0	4,269	5,000
Proceeds from sale of investment security	0	0	5,000
Payments for business acquisitions, net of cash acquired	(6,260)	(888)	(1,323)
Proceeds from disposals of property and equipment	135	662	395
Other investing activities	(335)	(68)	(50)
Net cash used in investing activities	(31,169)	(28,036)	(19,087)
Cash Flows from Financing Activities:
Proceeds from employee stock-based compensation plans	453	2,036	736
Increase in short-term borrowings	39,336	36,544	16,568
Payments on short-term borrowings	(57,622)	(48,296)	(18,051)
Dividends paid to noncontrolling interests	(274)	(610)	(144)
Payments on long-term debt and capital leases	(2,400)	(2,484)	(15,515)
Capitalized loan costs	(4,145)	0	(908)
Shares used to settle withholding taxes under stock-based compensation plans	(1,903)	(20)	(19)
Net cash used in financing activities	(26,555)	(12,830)	(17,333)
Effects of exchange rate changes on cash and cash equivalents	3,290	(8,450)	2,173
(Decrease) Increase in Cash and Cash Equivalents	(2,770)	22,269	(10,819)
Cash and Cash Equivalents at Beginning of Year	73,124	50,855	61,674
Cash and Cash Equivalents at End of Year	$70,354	$73,124	$50,855

Consolidated Statements of Shar

Consolidated Statements of Shareholders Equity, Noncontrolling Interests, and Comprehensive Income (Loss) (USD $)
In Thousands	Class A common stock	Class B common stock	Additional Paid-In Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Noncontrolling Interests	Total
Beginning Balance at Dec. 31, 2006	$25,741	$24,697	$15,468	$207,891	($62,646)	$4,544	$215,695
Comprehensive income (loss):
Net (loss) Income				16,116		235	16,351
Currency translation adjustments, net					16,382	411	16,793
Accrued retirement liabilities adjustment, net of $5,556, $(46,253) and $(8,682) tax in year 2007, 2008 and 2009 respectively					9,460		9,460
Interest-rate swaps, net of $(1,410), $376 and $1,147 tax in year 2007, 2008 and 2009 respectively					(2,463)		(2,463)
Total comprehensive loss							40,141
Impact of adoption of new income tax accounting guidance				(214)			(214)
Stock-based compensation costs			2,929				2,929
Shares issued in connection with stock-based compensation plans, net	197		539				736
Dividends paid to noncontrolling interests						(144)	(144)
Other equity transactions	(3)		121				118
Ending Balance at Dec. 31, 2007	25,935	24,697	19,057	223,793	(39,267)	5,046	259,261
Comprehensive income (loss):
Net (loss) Income				32,259		624	32,883
Currency translation adjustments, net					(37,577)	(252)	(37,829)
Currency translations reclassed for disposal of business					(344)		(344)
Accrued retirement liabilities adjustment, net of $5,556, $(46,253) and $(8,682) tax in year 2007, 2008 and 2009 respectively					(80,639)		(80,639)
Interest-rate swaps, net of $(1,410), $376 and $1,147 tax in year 2007, 2008 and 2009 respectively					(822)		(822)
Total comprehensive loss							(86,751)
Impact of adoption of new pension accounting guidance, net of $48 and $277 tax				94	492		586
Stock-based compensation costs			5,858				5,858
Shares issued in connection with stock-based compensation plans, net	593		1,443				2,036
Dividends paid to noncontrolling interests						(610)	(610)
Other equity transactions	(5)		(16)				(21)
Ending Balance at Dec. 31, 2008	26,523	24,697	26,342	256,146	(158,157)	4,808	180,359
Comprehensive income (loss):
Net (loss) Income				(115,683)		314	(115,369)
Currency translation adjustments, net					17,344	(244)	17,100
Accrued retirement liabilities adjustment, net of $5,556, $(46,253) and $(8,682) tax in year 2007, 2008 and 2009 respectively					(26,521)		(26,521)
Interest-rate swaps, net of $(1,410), $376 and $1,147 tax in year 2007, 2008 and 2009 respectively					1,931		1,931
Total comprehensive loss							(122,859)
Stock-based compensation costs			5,510				5,510
Shares issued in connection with stock-based compensation plans, net	832		(2,282)				(1,450)
Dividends paid to noncontrolling interests						(274)	(274)
Ending Balance at Dec. 31, 2009	$27,355	$24,697	$29,570	$140,463	($165,403)	$4,604	$61,286

2_Consolidated Statements of Sh

Consolidated Statements of Shareholders Equity, Noncontrolling Interests, and Comprehensive Income (Loss) (Parenthetical) (USD $)
In Thousands	12 Months Ended Dec. 31, 2009 Accumulated Other Comprehensive Loss	12 Months Ended Dec. 31, 2008 Accumulated Other Comprehensive Loss	12 Months Ended Dec. 31, 2007 Accumulated Other Comprehensive Loss
Retained Earnings
Comprehensive income (loss):
Tax effect on impact of adoption of new pension accounting guidance		$48
Accumulated Other Comprehensive Loss
Comprehensive income (loss):
Tax effect on accrued retirement liabilities adjustment	(8,682)	(46,253)	5,556
Tax effect on Interest-rate swap	1,147	376	(1,410)
Tax effect on impact of adoption of new pension accounting guidance		$277

Major Accounting and Reporting

Major Accounting and Reporting Policies
	12 Months Ended Dec. 31, 2009
Major Accounting and Reporting Policies [Abstract]
MAJOR ACCOUNTING AND REPORTING POLICIES	1.Major Accounting and Reporting Policies Nature of Operations and Industry Concentration Based in Atlanta, Georgia, Crawford Company (www.crawfordandcompany.com) is the worlds largest independent provider of claims management solutions to the risk management and insurance industry as well as self-insured entities, with a global network of more than 700 locations in 63 countries. The Crawford System of Claims Solutionssm offers comprehensive, integrated claims services, business process outsourcing and consulting services for major product lines including property and casualty claims management, workers compensation claims and medical management, and legal settlement administration. Shares of the Companys two classes of common stock are traded on the New York Stock Exchange under the symbols CRDA and CRDB, respectively. Principles of Consolidation The accompanying consolidated financial statements were prepared in accordance with accounting principles generally accepted in the United States (GAAP) and include the accounts of the Company, its majority-owned subsidiaries, and variable interest entities in which the Company is deemed to be the primary beneficiary. Significant intercompany transactions are eliminated in consolidation. The financial statements of the Companys international subsidiaries, other than those in Canada and the Caribbean, are included in the Companys consolidated financial statements on a two-month delayed basis (fiscal year-end of October 31)as permitted by GAAP in order to provide sufficient time for accumulation of their results. The Company uses the purchase method of accounting for all acquisitions where the Company is required to consolidate the acquired entity into the Companys financial statements. Results of operations of acquired businesses are included in the Companys consolidated results from the acquisition date. For variable interest entities (VIE), the Company determines when it should include the assets, liabilities, and results of operations of a VIE in its consolidated financial statements. The Company consolidates the liabilities of its deferred compensation plan and the related assets, which are held in a rabbi trust and considered a VIE of the Company. At December31, 2009 and 2008, the liabilities of this deferred compensation plan were $8,570,000 and $7,621,000, respectively, and the values of the assets held in the related rabbi trust were $13,551,000 and $12,985,000, respectively. These assets and liabilities are included in Other Noncurrent Assets and Other Noncurrent Liabilities on the Companys Consolidated Balance Sheets. The Company has controlling ownership interests in several entities that are not wholly-owned by the Company. The financial results and financial positions of these controlled entities are included in the Companys consolidated financial statements, for both the controlling interests and the noncontrolling interests. The noncontrolling interests represent the equity interests (formerly referred to as minority interests) in these entities that are not attributable, either directly or indirectly, to the Company. Noncontrolling interests are

Dispositions and Acquisitions o

Dispositions and Acquisitions of Businesses
	12 Months Ended Dec. 31, 2009
Dispositions and Acquisitions of Businesses [Abstract]
DISPOSITIONS AND ACQUISITIONS OF BUSINESSES	2. Dispositions And Acquisitions of Businesses Disposition of Netherlands Subsidiary In 2008, the Companys Netherlands subsidiary sold the capital stock of one of its subsidiaries. The net cash received from the buyer was $4,269,000, which consisted of the cash sale price of $5,256,000, less cash of $987,000 retained in the sold subsidiary. The nontaxable gain recognized on this disposition was $2,512,000, including a cumulative translation adjustment of $344,000 related to this sold entity. In connection with this disposition, the Company derecognized goodwill of $1,437,000 from the Companys International Operations segment and reporting unit. The revenues and expenses of this sold subsidiary were not material to the consolidated financial statements of the Company or to the operating results of the Companys International Operations segment. Accordingly, the Company has not reported the disposed business as discontinued operations in its consolidated financial statements. Acquisition of Specialty Liability Services Ltd. In 2006, the Companys U.K. subsidiary acquired all of the outstanding stock of Specialty Liability Services Ltd. (SLS). The purchase price paid at acquisition was $7,965,000, less $1,099,000 cash acquired. The results of SLSs operations have been included in the Companys consolidated financial statements since that date. SLS is a specialist liability adjusting and claims handling company with operations in the U.K. The net assets acquired included amortizable intangible assets of $1,409,000, indefinite-live intangible assets of $2,487,000, and goodwill of $2,929,000. The purchase price was increased by $1,545,000, $888,000 and $338,000 in 2009, 2008 and 2007, respectively, due to additional acquisition costs incurred in 2007 and earnout payments in all three years. At December31, 2009, all contingent amounts related to the SLS acquisition have been determined and all have been paid with the exception of $791,000 expected to be paid in 2010. At December31, 2009, this $791,000 is included in Goodwill and in current Accrued Liabilities on the Companys Consolidated Balance Sheet. Other acquisitions made by the Company in 2009, 2008, and 2007 were not material.

Goodwill and Intangible Assets

Goodwill and Intangible Assets
	12 Months Ended Dec. 31, 2009
Goodwill and Intangible Assets [Abstract]
GOODWILL AND INTANGIBLE ASSETS	3. Goodwill And Intangible Assets The goodwill recognized, fair values of assets acquired, liabilities assumed, and the net cash paid in 2009 and 2008 related to acquired businesses, including adjustments for prior acquisitions, were as follows: 2009 2008 (In thousands) Goodwill acquired For current year acquisitions: U.S. Property Casualty segment $ 1,000 $ Adjustments for prior years acquisitions: International Operations segment 1,545 4,949 Total goodwill $ 2,545 $ 4,949 Intangible assets acquired Adjustments for prior years acquisitions: Corporate $ 6 Total intangible assets $ $ 6 Fair values of tangible assets acquired $ $ (6 ) Earnout payment in accrued liabilities $ 1,391 $ 4,061 Earnout payment paid from accrued liabilities $ 5,106 $ Cash paid, net of cash acquired $ 6,260 $ 888 Adjustments for prior years acquisitions were for payments made under earnout agreements. Included in the 2008 goodwill adjustments of $4,949,000 for the International Operations segment is a $4,061,000 additional earnout payment due to the seller of Robertson Company Group (Robertson). Robertson was acquired by the Companys Australian subsidiary in 2002. Based on the earnout agreement, the Company recorded a determinable earnout payment in translated U.S.dollars of $4,061,000 in goodwill at December31, 2008. However, the Company was not required to make this earnout payment until 2009, thus it was not reflected as a use of cash in the investing section of the Companys Consolidated Statement of Cash Flows for the year ended December31, 2008. This accrued earnout payment was paid to Robertson in 2009 when the translated amount in U.S.dollars had changed to $5,106,000 at time of payment. Goodwill Impairment Charge in 2009 Due to declines in current and forecasted operating results for the Companys Broadspire segment and reporting unit, the impact that declining U.S.employment levels have had on Broadspires revenue, and the weakness in the Companys stock prices, the Company recorded a noncash impairment charge of $140.3million during 2009. This impairment charge is not deductible for income tax purposes and is not reflected in Broadspires segment operating loss. This impairment charge did not affect the Companys liquidity or cash flows and had no effect on the Companys compliance with the financial covenants under its credit agreement. The first step of the goodwill impairment testing and measurement process involved estimating the fair value of Broadspire using an internally prepared discounted cash flow analysis. The discount rate utilized in estimating the fair value of Broadspire was 14%, reflecting the Companys assessment of a market participants view of the risks associated with Broadspires projected cash flows.

Short-Term and Long-Term Debt,

Short-Term and Long-Term Debt, Including Capital Leases
	12 Months Ended Dec. 31, 2009
Short-Term and Long-Term Debt, Including Capital Leases [Abstract]
SHORT-TERM AND LONG-TERM DEBT, INCLUDING CAPITAL LEASES	4. Short-Term and Long-Term Debt, including Capital Leases On October31, 2006, the Company entered into a secured credit agreement (the Credit Agreement) with a syndication of lenders. The Credit Agreement provides for a maximum borrowing capacity of $310,000,000, comprised of (i)a term loan facility (the term loan) with an original principal amount of $210,000,000 and (ii)a revolving credit facility in the principal amount of $100,000,000 with a swingline subfacility, a letter of credit subfacility, and a foreign currency sublimit. The Credit Agreement has been amended five times since October31, 2006. All amendments to the Companys Credit Agreement have been accounted for as a modification of existing debt. Amended provisions of the original agreement and amendments that were subsequently superseded by other amendments are not included in this note. At December31, 2009 and 2008, a total of $180,675,000 and $194,618,000, respectively, was outstanding under the Credit Agreement. In addition, undrawn commitments under letters of credit totaling $19,569,000 and $19,870,000 were outstanding at December31, 2009 and 2008, respectively, under the letters of credit subfacility of the Credit Agreement. These letter of credit commitments were for the Companys own obligations. Including the amounts committed under the letters of credit subfacility, the unused balance of the revolving credit portion of the credit facility totaled $80,431,000 and $68,286,000 at December31, 2009 and 2008, respectively. Short-term borrowings, including bank overdraft facilities, totaled $32,000 and $13,366,000 at December31, 2009 and 2008, respectively. Long-term debt consisted of the following at December31, 2009 and 2008: 2009 2008 (In thousands) Term loan facility, principal of $525 and interest payable quarterly with balloon payment due October 2013 $ 180,675 $ 182,775 Other term loan payable to bank 161 231 Capital lease obligations 414 484 Total long-term debt and capital leases 181,250 183,490 Less: current installments (8,189 ) (2,284 ) Total long-term debt and capital leases, less current installments $ 173,061 $ 181,206 The Companys capital leases are primarily comprised of leased automobiles with terms ranging from 24 to 60months. Interest expense, including any impact from the Companys interest rate hedge and amortization of capitalized loan origination costs, on the Companys short-term and long-term borrowings was $15,229,000, $19,616,000, and $19,202,000 for the years ended December31, 2009, 2008, and 2007, respectively. Interest paid on the Companys short-term and long-term borrowings was $14,339,000, $19,037,000, and $21,166,000 for the years ended December31, 2009, 2008, and 2007, respectively. At December31, 2008, the weighted-average interest rate on borrowings outstanding under the revolving credit facility was 9.97% and all outstanding borrowings were

Interest Rate Swap Agreements

Interest Rate Swap Agreements
	12 Months Ended Dec. 31, 2009
Interest Rate Swap Agreements [Abstract]
INTEREST RATE SWAP AGREEMENTS	5. Interest Rate Swap Agreements The Company manages its exposure to the impact of interest rate changes by entering interest rate swap agreements. The Company designates pay-fixed interest rate swaps as cash flow hedges of interest payments on floating-rate debt. Pay-fixed swaps effectively convert floating rate debt to fixed-rate debt. The Company reports the effective portion of the change in fair value of the derivative instrument as a component of its accumulated other comprehensive loss and reclassifies that portion into earnings in the same period during which the hedged transaction affects earnings. The Company recognizes the ineffective portion of the hedge, if any, in current earnings during the period of change. Amounts that are reclassified into earnings from accumulated other comprehensive loss and the ineffective portion of the hedge, if any, are reported on the same income statement line item as the original hedged item. The Company includes the fair value of the hedge in either current or non-current other liabilities and/or other assets on the balance sheet based upon the term of the hedged item. The Company is exposed to counterparty credit risk for nonperformance and, in the event of nonperformance, to market risk for changes in interest rates. The Company attempts to manage exposure to counterparty credit risk primarily by selecting a counterparty only if it meets certain credit and other financial standards. In May 2007, the Company entered into a three-year interest rate swap agreement that effectively converts the LIBOR-based portion of the interest rate under the Companys Credit Agreement for a portion of its floating-rate debt to a fixed rate of 5.25%. The Company designated the interest rate swap as a cash flow hedge of exposure to changes in cash flows due to changes in interest rates on an equivalent amount of debt. The notional amount of the swap is reduced over its three-year term and was $80,000,000 at December31, 2009. In connection with the Fifth Amendment to the Companys Credit Agreement, this interest rate swap was discontinued as a cash flow hedge of exposure to changes in cash flows due to changes in interest rates. Accordingly, any future changes in the fair value of this swap agreement will be recorded by the Company as a noninterest expense adjustment rather than a component of the Companys accumulated other comprehensive loss. Such amount was not material for the year ended December31, 2009. The pretax amount in accumulated comprehensive loss at the time the hedge was discontinued was $2,652,000 and was $1,593,000 at December31, 2009. Because it is still probable that the forecasted transactions that were hedged will occur, this loss on the interest rate swap agreement will be reclassified into earnings as an increase to interest expense over the remaining life of the interest rate swap agreement as the forecasted transactions occur. The Company believes there have been no material changes in the creditworthiness of the counterparty to this interest-rate swap agreement In November 2009, the Company entered into a two-year forward-starting interest rate swap agreement th

Fair Value

Fair Value
	12 Months Ended Dec. 31, 2009
Fair Value [Abstract]
FAIR VALUE	6. Fair Value The fair value hierarchy has three levels which are based on the reliability of the inputs used to determine fair value. Level1 inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities. Level2 inputs are quoted prices for similar assets and liabilities in active markets or inputs that are observable for the asset or liability, either directly or indirectly through market corroboration, for substantially the full term of the financial instrument. Level3 inputs are unobservable inputs based on the Companys assumptions used to measure assets and liabilities at fair value. A financial asset or liabilitys classification within the hierarchy is determined based on the lowest level input that is significant to the fair value measurement. The following table presents the Companys assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. Fair Value Measurements at December31, 2009 Significant Other Significant Quoted Prices in Observable Unobservable Active Markets Inputs Inputs Total (Level 1) (Level 2) (Level 3) (In thousands) Assets: Money market funds(1) $ 2,888 $ 2,888 $ $ Liabilities: Derivative designated as hedging instrument: Interest rate swap(2) (400 ) (400 ) Derivative discontinued as hedging instrument: Interest rate swap(2) (1,667 ) (1,667 ) (1) The fair values of the money market funds were based on recently quoted market prices and reported transactions in an active marketplace. Money market funds are reported on the Companys Consolidated Balance Sheet as Cash and Cash Equivalents. (2) The fair value of the interest rate swaps was derived from a discounted cash flow analysis based on the terms of the contracts and the forward interest rate curve adjusted for the Companys credit risk. The fair values of the hedge instruments are either current or non-current Other Liabilities and/or Other Assets on the Companys Consolidated Balance Sheet based upon the term of the hedged item. Fair Value Disclosures The fair value of accounts payable and short-term borrowings approximates their carrying value due to the short-term maturity of the instruments. The Company estimates the fair value of its term note payable based on a discounted cash flow analysis based on current borrowing rates for new debt issues with similar credit quality. The fair value of the Companys variable-rate long-term debt approximates carrying value at December31, 2009.

Commitments Under Operating Lea

Commitments Under Operating Leases
	12 Months Ended Dec. 31, 2009
Commitments Under Operating Leases [Abstract]
COMMITMENTS UNDER OPERATING LEASES	7. Commitments Under Operating Leases The Company and its subsidiaries lease certain office space, computer equipment, and automobiles under operating leases. For office leases that contain scheduled rent increases or rent concessions, the Company recognizes monthly rent expense based on a calculated average monthly rent amount that considers the rent increases and rent concessions over the life of the lease term. Leasehold improvements of a capital nature that are made to leased office space under operating leases are amortized over the shorter of the term of the lease or the estimated useful life of the improvement. License and maintenance costs related to the leased vehicles are paid by the Company. Rental expenses, net of amortization of any incentives provided by lessors, for operating leases consisted of the following: 2009 2008 2007 (In thousands) Office space $ 44,069 $ 46,501 $ 48,026 Automobiles 7,978 9,651 8,654 Computers and equipment 728 646 634 Total operating leases $ 52,775 $ 56,798 $ 57,314 At December31, 2009, future minimum payments under non-cancelable operating leases with terms of more than 12months were as follows: 2010 $51,723,000; 2011 $41,668,000; 2012 $34,429,000; 2013 $28,342,000; 2014 $21,386,000; and thereafter $61,756,000. Where applicable, the amounts above include sales taxes. Significant Operating Leases and Subleases Effective August1, 2006, the Company entered into an 11-year operating lease agreement for the lease of approximately 160,000square feet of office space in Atlanta, Georgia for use as the Companys corporate headquarters. Included in the future minimum lease payments noted above are total lease payments of $31,227,000 related to this lease. Additionally, the Company is responsible for certain property operating expenses. Leasehold improvements totaling $4,921,000 were funded directly by the lessor. On October31, 2006, the Company acquired Broadspire Management Services, Inc. (BMSI). Included in the acquired commitments of BMSI was a long-term operating lease for a two-building office complex in Plantation, Florida. The term of this lease ends in December 2021. Included in the future minimum office lease payments for operating leases noted above are total lease payments $51,020,000 related to this Plantation, Florida lease. A majority of this office space is subleased at December31, 2009. Under executed sublease arrangements at December31, 2009 between the Company and sublessors, as described below, the sublessors are obligated to pay the Company minimum sublease payments as follows: Year Ending December 31, (In thousands) 2010 $ 2,098 2011 2,211 2012 2,461 2013 2,503 2014 1,082 2015-2021 4,612 Total minimum sublease payments to be received $ 14,967 One of the

Income Taxes

Income Taxes
	12 Months Ended Dec. 31, 2009
Income Taxes [Abstract]
INCOME TAXES	8. Income Taxes Income (loss) before provision for income taxes consisted of the following: 2009 2008 2007 (In thousands) U.S. $ (146,898 ) $ 6,190 $ (1,744 ) Foreign 34,147 38,257 23,491 (Loss) Income before taxes $ (112,751 ) $ 44,447 $ 21,747 The provision (benefit) for income taxes consisted of the following: 2009 2008 2007 (In thousands) Current: U.S. federal and state $ (4,769 ) $ (166 ) $ (1,172 ) Foreign 6,924 11,483 8,005 Deferred: U.S. federal and state (823 ) 766 (2,110 ) Foreign 1,286 (519 ) 673 Provision for income taxes $ 2,618 $ 11,564 $ 5,396 Net cash payments for income taxes were $10,301,000, $7,975,000, and $2,339,000 in 2009, 2008, and 2007, respectively. The provision for income taxes is reconciled to the federal statutory rate of 35% as follows: 2009 2008 2007 (In thousands) Federal income taxes at statutory rate $ (39,642 ) $ 15,338 $ 7,529 State income taxes, net of federal benefit 562 (223 ) 149 Foreign taxes (4,400 ) (2,110 ) (658 ) Change in valuation allowance 358 597 1,105 Credits (4,074 ) (3,468 ) (1,062 ) Tax exempt interest income (11 ) (267 ) (1,155 ) Nondeductible meals and entertainment 954 1,189 847 Changes in tax accruals and reserves (200 ) (170 ) (2,012 ) Goodwill intangible asset impairments 49,191 Other (120 ) 678 653 Provision for income taxes $ 2,618 $ 11,564 $ 5,396 The Company does not provide for additional U.S.and foreign income taxes on undistributed earnings of foreign subsidiaries because they are considered to be indefinitely reinvested. The Companys intent is for such earnings to be reinvested by the subsidiaries or to be repatriated only when it would be tax effective through the utilization of foreign tax credits. At December31, 2009, such undistributed earnings totaled $89,001,000. Determination of the deferred income tax liability on these unremitted earnings is not practicable since such liability, if any, is dependent on circumstances existing when remittance occurs. Deferred income taxes consisted of the following at December31, 2009 and 2008:

Retirement Plans

Retirement Plans
	12 Months Ended Dec. 31, 2009
Retirement Plans [Abstract]
RETIREMENT PLANS	9. Retirement Plans The Company and its subsidiaries sponsor various retirement plans. Substantially all employees in the U.S.and certain employees outside the U.S.are covered under the Companys defined contribution plans. Certain employees, retirees, and eligible dependents are also covered under the Companys defined benefit pension plans. A fixed number of U.S.employees, retirees, and eligible dependents are covered under a frozen post-retirement medical benefits plan in the U.S.In addition, the Company sponsors nonqualified, unfunded defined benefit pension plans for certain employees and retirees. Employer contributions under the Companys defined contribution plans are determined annually based on employee contributions, a percentage of each covered employees compensation, and years of service. The Companys cost for defined contribution plans totaled $18,944,000, $25,350,000, and $21,256,000 in 2009, 2008, and 2007, respectively. During 2009, the Company temporarily suspended Company contributions for certain defined contribution plans in the U.S. The Company sponsors defined benefit pension plans in the U.S.and U.K. Effective December31, 2002, the Company elected to freeze its U.S.defined benefit pension plan. The Companys U.K. defined benefit pension plans have also been closed for new employees, but existing participants may still accrue additional limited benefits based on salary amounts in effect at the time the plan was closed. Benefits payable under the Companys U.S defined benefit pension plan are generally based on career compensation; however, no additional benefits accrue on the frozen U.S.plan after December31, 2002. Benefits payable under the U.K. plans are generally based on an employees final salary at the time the plan was closed. Benefits paid from the U.K. plans are also subject to adjustments for the effects of inflation. In 2010, the Company expects to make contributions of approximately $33,500,000 to its U.S.defined benefit pension plan and approximately $8,000,000 to its U.K. defined benefit pension plans. Certain other employees located in the Netherlands, Norway, and Germany (referred to herein as the other international plans) have retirement benefits that are accounted for as defined pension benefits under U.S.GAAP. The reconciliation of the beginning and ending balances of the projected benefit obligations and the fair value of plans assets for the Companys defined benefit pension plans as of the plans most recent measurement dates is as follows: Funded Status December31, 2009 2008 (In thousands) Projected Benefit Obligations: Beginning of measurement period $ 537,712 $ 629,640 Service cost 2,073 2,506 Interest cost 36,221 40,694 Employee contributions 768 716 Actuarial loss (gain) 91,798 (48,123 ) Divestiture (1,706 ) Benefits paid (32,277 ) (33,808 ) Foreign currency effects 5,013 (52,207 )

Common Stock

Common Stock
	12 Months Ended Dec. 31, 2009
Common Stock [Abstract]
COMMON STOCK	10. Common Stock The Company has two classes of common stock outstanding, ClassA Common Stock (CRDA) and ClassB Common Stock (CRDB). These two classes of stock have essentially identical rights, except that shares of CRDA generally do not have any voting rights. Under the Companys Articles of Incorporation, the Board of Directors may pay higher (but not lower) cash dividends on the non-voting CRDA than on the voting CRDB. As described in Note11, certain shares of CRDA are issued with restrictions under executive compensation plans. As disclosed in Note4, the Companys Credit Agreement contains restrictions on dividends and distributions. In April 1999, the Companys Board of Directors authorized a discretionary share repurchase program of an aggregate of 3,000,000shares of CRDA and CRDB through open market purchases. Through December31, 2009, the Company has reacquired 2,150,876shares of CRDA and 143,261shares of CRDB at an average cost of $10.99 and $12.21 per share, respectively. No shares have been repurchased since 2004 under this plan. In 2008, a maximum of 550,000shares of CRDA were authorized for issuance in 2009 under the Companys Frozen Accrued Vacation Stock Purchase Plan (the Plan). Under this Plan, certain officers and employees of the Company could voluntarily make a one-time irrevocable election to convert accrued vacation into shares of CRDA. Accrued vacation in the amount of $372,000 was used to purchase 54,768 (net of 28,090shares used to fund payroll and withholding taxes) shares of CRDA under the Plan.

Stock-Based Compensation

Stock-Based Compensation
	12 Months Ended Dec. 31, 2009
Stock-Based Compensation [Abstract]
STOCK-BASED COMPENSATION	11. Stock-Based Compensation The Company has various stock-based compensation plans for its employees and members of its board of directors. Only shares of the Companys ClassA Common Stock (CRDA) are involved in these plans. The fair value of an equity award is estimated on the grant date without regard to service or performance conditions. The fair value is recognized as compensation expense over the requisite service period for all awards that vest. When recognizing compensation costs, estimates are made for the number of awards that will vest, and subsequent adjustments are made to reflect both changes in the number of shares expected to vest and actual vesting. Compensation cost is not recognized for awards that do not vest because service or performance conditions are not satisfied. Compensation cost recognized at any date equals at least the portion of the grant-date value of an award that is vested at that date. For awards granted prior to January1, 2006 that were not previously subject to the expense recognition provisions of previous accounting guidance, compensation expense under the revised accounting guidance is recognized only for the portions of those awards that were unvested at the adoption of the revised accounting guidance on January1, 2006. Expense for these awards is recognized ratably beginning January1, 2006 over the remaining vesting period of each award. The pretax compensation expense recognized for all stock-based compensation plans was $5,510,000, $5,858,000 and $2,929,000 for the years ended December31, 2009, 2008, and 2007, respectively. The total income tax benefit recognized in the Consolidated Statements of Operations for stock-based compensation arrangements was approximately $1,709,000, $1,801,000, and $816,000 for the years ended December31, 2009, 2008, and 2007, respectively. Some of the Companys stock-based compensation awards are granted under plans which are designed not to be taxable as compensation to the recipient based on tax laws of the United States or the applicable country. Accordingly, the Company does not recognize tax benefits on all of its stock-based compensation expense. During 2009, 2008 and 2007, the Company recognized no adjustments to additional paid-in capital for differences between deductions taken on its income tax returns related to stock-based compensation plans and the related income tax benefits previously recognized for financial reporting purposes. Stock Options The Company has granted nonqualified and incentive stock options to key employees and directors. All stock options were for shares of CRDA. Option awards were granted with an exercise price equal to the market price of the Companys stock at the date of grant. The Companys stock option plans have been approved by shareholders, although the Companys Board of Directors is authorized to make specific grants of stock options under active plans. Employee stock options typically are subject to graded vesting over five years (20% each year) and have a typical life of ten years. Compensation cost for stock options is recognized on a straight-line basis over the requisite service per

Segment and Geographic Informat

Segment and Geographic Information
	12 Months Ended Dec. 31, 2009
Segment and Geographic Information [Abstract]
SEGMENT AND GEOGRAPHIC INFORMATION	12. Segment and Geographic Information The Companys four reportable operating segments are organized based upon the nature of services and/or geographic areas served and include: U.S.Property Casualty which serves the U.S.property and casualty insurance company market, International Operations which serves the property and casualty insurance company markets outside of the U.S., Broadspire which serves the U.S.self-insurance marketplace, and Legal Settlement Administration which serves the securities, bankruptcy, and other legal settlement markets. The Companys four reportable segments represent components of the business for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. Intersegment sales are recorded at cost and are not material. Operating earnings is the primary financial performance measure used by the Companys senior management and chief operating decision maker to evaluate the financial performance of the Companys four operating segments. The Company believes this measure is useful to investors in that it allows investors to evaluate segment operating performance using the same criteria used by the Companys senior management. Operating earnings will differ from net income computed in accordance with GAAP since operating earnings exclude income tax expense, net corporate interest expense, amortization of customer-relationship intangible assets, stock option expense, certain other gains and expenses, and certain unallocated corporate and shared costs. Net income or loss attributable to noncontrolling interests has been removed from segment operating earnings. Segment operating earnings include allocations of certain corporate overhead and shared costs. If the Company changes its allocation methods or changes the types of costs that are allocated to its four operating segments, prior periods are adjusted to reflect the current allocation process. In the normal course of its business, the Company sometimes pays for certain out-of-pocket expenses that are reimbursed by its clients. Under GAAP, these out-of-pocket expenses and associated reimbursements are reported as revenues and expenses in the Companys Consolidated Statement of Operations. However, in evaluating segment revenues, Company management excludes these reimbursements from segment revenues. On January1, 2008, the Companys Strategic Warranty Services unit was transferred from the Legal Settlement Administration segment to the U.S.Property Casualty segment. Prior period amounts for both segments have been restated to reflect this transfer. Financial information as of and for the years ended December31, 2009, 2008, and 2007 covering the Companys reportable segments was as follows: U.S. Property International Legal Settlement Casualty Operations Broadspire Administration Total (In thousands) 2009 Revenues before reimbursements $

Client Funds

Client Funds
	12 Months Ended Dec. 31, 2009
Client Funds [Abstract]
CLIENT FUNDS	13. Client Funds The Company maintains funds in custodial accounts at financial institutions to administer claims for certain clients. These funds are not available for the Companys general operating activities and, as such, have not been recorded in the accompanying Consolidated Balance Sheets. The amount of these funds totaled $242,334,000 and $246,280,000 at December31, 2009 and 2008, respectively. In addition, the Companys Legal Settlement Administration segment administers funds in noncustodial accounts at financial institutions that totaled $578,821,000 and $1,010,593,000 at December31, 2009 and 2008, respectively.

Contingencies

Contingencies
	12 Months Ended Dec. 31, 2009
Contingencies [Abstract]
CONTINGENCIES	14. Contingencies As part of the Companys Credit Agreement, the Company maintains a letter of credit facility to satisfy certain of its own contractual requirements. At December31, 2009, the aggregate amount committed under the facility was $19,569,000. In the normal course of the claims administration services business, the Company is sometimes named as a defendant in suits by insureds or claimants contesting decisions made by the Company or its clients with respect to the settlement of claims. Additionally, certain clients of the Company have brought actions for indemnification on the basis of alleged negligence by the Company, its agents, or its employees in rendering service to clients. The majority of these claims are of the type covered by insurance maintained by the Company. However, the Company is responsible for the deductibles and self-insured retentions under various insurance coverages. In the opinion of Company management, adequate provisions have been made for such risks. The Company is subject to numerous federal, state, and foreign employment laws, and from time to time the Company faces claims by its employees and former employees under such laws. In addition, the Company has become aware that certain employers are becoming subject to an increasing number of claims involving alleged violations of wage and hour laws. The outcome of any of these allegations is expected to be highly fact specific, and there has been a substantial amount of recent legislative and judicial activity pertaining to employment-related issues. Such claims or litigation involving the Company or any of the Companys current or former employees could divert managements time and attention from the Companys business operations and could potentially result in substantial costs of defense, settlement or other disposition, which could have a material adverse effect on the Companys results of operations, financial position, and cash flows. As previously disclosed, on October31, 2006, the Company completed its acquisition of BMSI from Platinum Equity, LLC (Platinum). BMSI and Platinum are together engaged in certain legal proceedings against the former owners of certain entities acquired by BMSI prior to the Companys acquisition of BMSI. Pursuant to the agreement under which the Company acquired BMSI (the Stock Purchase Agreement), Platinum has full responsibility to resolve all of these matters and is obligated to fully indemnify BMSI and the Company for all monetary payments that BMSI may be required to make as a result of any unfavorable outcomes related to these pre-existing legal proceedings. Pursuant thereto, Platinum has also agreed to indemnify the Company for any additional payments required under any purchase price adjustment mechanism, earnout, or similar provision in any of BMSIs purchase and sale agreements entered into prior to the Companys acquisition of BMSI. In the event of an unfavorable outcome in which Platinum does not indemnify the Company under the terms of the Stock Purchase Agreement, the Company may be responsible for funding any such unfavorable outcomes. At this time, the Companys management does not believe

Sale of the Former Corporate He

Sale of the Former Corporate Headquarters and Recognition of Deferred Gain
	12 Months Ended Dec. 31, 2009
Sale of the Former Corporate Headquarters and Recognition of Deferred Gain [Abstract]
SALE OF THE FORMER CORPORATE HEADQUARTERS AND RECOGNITION OF DEFERRED GAIN	15.Sale of the Former Corporate Headquarters and Recognition of Deferred Gain On June30, 2006, the Company sold the land and building utilized as its former corporate headquarters in Atlanta, Georgia. These assets had a net carrying amount of $2,842,000. The base sale price of $8,000,000 was received in cash at closing. Also on June30, 2006, the Company entered into a 12-month leaseback agreement for these same facilities. During the second quarter of 2007, the company relocated its corporate headquarters to nearby leased facilities. The Company deferred recognition of the gain related to this sale due to its leaseback of the facility. Net of transaction costs, a pretax gain of $4,844,000 was recognized by the Company upon the expiration of the leaseback agreement during the second quarter of 2007. Under the sale agreement, the $8,000,000 base sale price is subject to upward revision depending upon the buyers ability to subsequently redevelop the property. The gain of $4,844,000 was based on the base sale price and did not include any amount for the potential upward revision of the sale price. Should such revision subsequently occur, the Company could ultimately realize a larger gain.

Restructuring Activities and Ot

Restructuring Activities and Other Charges
	12 Months Ended Dec. 31, 2009
Restructuring Activities and Other Charges [Abstract]
RESTRUCTURING ACTIVITIES AND OTHER CHARGES	16.Restructuring Activities and Other Charges In 2009, the Company recorded pretax restructuring and other costs that totaled $4,059,000. Included in the 2009 restructuring costs were $1,815,000 in professional fees related to the internal realignment of certain of our legal entities in the U.S.and internationally that commenced in 2008, and $434,000 in severance expense in our International Operations segment. These restructuring efforts were substantially completed at December31, 2009. The internal realignment did not impact the composition of our segments for financial reporting purposes. Other costs of $1,810,000 in 2009 related to the partial sublease of our Broadspire facility in Plantation, Florida (see Note7, Commitments Under Operating Leases). In 2008, the Company recorded a pretax restructuring charge of $3,300,000. The charge consisted of $1,825,000 for severance and other costs in our International Operations segment, $300,000 for severance costs in our U.S.Property and Casualty segment, and $1,175,000 for professional fees incurred in connection with an internal restructuring of certain of the Companys legal entities in the U.S.and internationally.