CONSOLIDATED RESULTS OF OPERATIONS (USD $) In Millions, except Per Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2009	Dec. 31, 2008	Dec. 31, 2007
CONSOLIDATED RESULTS OF OPERATIONS
Net sales	$ 7,066.5	$ 7,884.7	$ 7,566.7
Manufacturing, shipping, and delivery	(5,582.6)	(6,208.1)	(5,971.4)
Gross profit	1,483.9	1,676.6	1,595.3
Selling and administrative expense	(506.4)	(511.9)	(520.6)
Research, development, and engineering expense	(58.8)	(66.6)	(65.8)
Interest expense	(221.7)	(253.0)	(348.6)
Interest income	28.6	38.6	42.3
Equity earnings	52.6	50.8	34.1
Royalties and net technical assistance	12.9	18.6	19.7
Other income	11.2	9.5	16.4
Other expense	(477.0)	(404.2)	(266.2)
Earnings from continuing operations before income taxes	325.3	558.4	506.6
Provision for income taxes	(127.5)	(236.7)	(147.8)
Earnings from continuing operations	197.8	321.7	358.8
Net earnings of discontinued operations			3.0
Gain on sale of discontinued operations		6.8	1,038.5
Net earnings	197.8	328.5	1,400.3
Net earnings attributable to noncontrolling interests	(36.0)	(70.2)	(59.7)
Net earnings attributable to the Company	161.8	258.3	1,340.6
Convertible preferred stock dividends		(5.4)	(21.5)
Earnings available to common share owners	161.8	252.9	1,319.1
Amounts attributable to the Company:
Earnings from continuing operations	161.8	251.5	299.3
Net earnings of discontinued operations			2.8
Gain on sale of discontinued operations		6.8	1,038.5
Net earnings attributable to the Company	$ 161.8	$ 258.3	$ 1,340.6
Basic earnings per share:
Earnings from continuing operations (in dollars per share)	$ 0.96	$ 1.49	$ 1.78
Net earnings of discontinued operations (in dollars per share)			$ 0.02
Gain on sale of discontinued operations (in dollars per share)		$ 0.04	$ 6.66
Net earnings (in dollars per share)	$ 0.96	$ 1.53	$ 8.46
Diluted earnings per share:
Earnings from continuing operations (in dollars per share)	$ 0.95	$ 1.48	$ 1.78
Net earnings of discontinued operations (in dollars per share)			$ 0.02
Gain on sale of discontinued operations (in dollars per share)		$ 0.04	$ 6.19
Net earnings (in dollars per share)	$ 0.95	$ 1.52	$ 7.99

CONSOLIDATED BALANCE SHEETS (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2009	Dec. 31, 2008	Dec. 31, 2007
Current assets:
Cash, including time deposits of $561.4 ($307.5 in 2008)	$ 811.7	$ 379.5	$ 387.7
Short-term investments	0.9	25.0
Receivables, less allowances of $36.5 ($39.7 in 2008) for losses and discounts	1,004.2	988.8
Inventories	900.3	999.5
Prepaid expenses	79.6	51.9
Total current assets	2,796.7	2,444.7
Other assets:
Equity investments	114.3	101.7
Repair parts inventories	125.1	132.5
Prepaid pension	46.3
Deposits, receivables, and other assets	521.7	444.5
Goodwill	2,381.0	2,207.5
Total other assets	3,188.4	2,886.2
Property, plant, and equipment:
Land, at cost	248.5	248.1
Buildings and equipment, at cost:
Buildings and building equipment	1,175.8	1,078.4
Factory machinery and equipment	4,771.6	4,345.3
Transportation, office, and miscellaneous equipment	131.1	114.6
Construction in progress	291.9	196.7
Total property, plant, and equipment, at cost	6,618.9	5,983.1
Less accumulated depreciation	3,876.6	3,337.5
Net property, plant, and equipment	2,742.3	2,645.6
Total assets	8,727.4	7,976.5
Current liabilities:
Short-term loans	302.3	375.6
Accounts payable	863.2	838.2
Salaries and wages	170.8	141.6
U.S. and foreign income taxes	39.8	78.7
Current portion of asbestos-related liabilities	175.0	175.0
Other accrued liabilities	433.5	376.0
Long-term debt due within one year	49.7	18.2
Total current liabilities	2,034.3	2,003.3
Long-term debt	3,257.5	2,940.3
Deferred taxes	186.3	77.6
Pension benefits	577.6	741.8
Nonpension postretirement benefits	266.7	239.7
Other liabilities	358.5	360.1
Asbestos-related liabilities	310.1	320.3
Commitments and contingencies
The Company's share owners' equity:
Common stock, par value $.01 per share, 250,000,000 shares authorized, 179,923,309 and 178,705,817 shares issued and outstanding, respectively	1.8	1.8
Capital in excess of par value	2,941.9	2,913.3
Treasury stock, at cost 11,322,544 and 11,556,341 shares, respectively	(217.1)	(221.5)
Retained earnings (deficit)	129.4	(32.4)
Accumulated other comprehensive loss	(1,317.8)	(1,620.6)
Total share owners' equity of the Company	1,538.2	1,040.6
Noncontrolling interests	198.2	252.8
Total share owners' equity	1,736.4	1,293.4	2,439.1
Total liabilities and share owners' equity	$ 8,727.4	$ 7,976.5

CONSOLIDATED BALANCE SHEETS (Parenthetical) (USD $) In Millions, except Share data, unless otherwise specified	Dec. 31, 2009	Dec. 31, 2008
CONSOLIDATED BALANCE SHEETS
Time deposits (in dollars)	$ 561.4	$ 307.5
Allowances for losses and discounts (in dollars)	$ 36.5	$ 39.7
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	250,000,000	250,000,000
Common stock, shares issued	179,923,309	178,705,817
Common stock, shares outstanding	179,923,309	178,705,817
Treasury stock, shares	11,322,544	11,556,341

CONSOLIDATED STOCKHOLDERS' EQUITY (USD $) In Millions, unless otherwise specified	Total	Convertible Preferred Stock, Common Stock, Capital in Excess of Par Value, and Treasury Stock	Retained Earnings (Deficit)	Accumulated Other Comprehensive Loss	Non-controlling Interests	Comprehensive Income
Balance at Dec. 31, 2006	$ 563.3	$ 2,555.3	$ (1,604.4)	$ (594.2)	$ 206.6
Issuance of common stock	90.5	90.5
Reissuance of common stock	3.8	3.8
Comprehensive income:
Net earnings	1,400.3		1,340.6		59.7
Foreign currency translation adjustments	339.3			325.3	14.0
Pension and other postretirement benefit adjustments, net of tax	63.8			63.8
Change in fair value of derivative instruments, net of tax	28.2			28.2
Total comprehensive income (loss)	1,831.6					1,831.6
Dividends paid to noncontrolling interests on subsidiary common stock	(28.6)				(28.6)
Dividends paid on convertible preferred stock	(21.5)		(21.5)
Balance at Dec. 31, 2007	2,439.1	2,649.6	(285.3)	(176.9)	251.7
Issuance of common stock	40.9	40.9
Reissuance of common stock	3.1	3.1
Comprehensive income:
Net earnings	328.5		258.3		70.2
Foreign currency translation adjustments	(451.4)			(431.9)	(19.5)
Pension and other postretirement benefit adjustments, net of tax	(978.9)			(978.9)
Change in fair value of derivative instruments, net of tax	(32.9)			(32.9)
Total comprehensive income (loss)	(1,134.7)					(1,134.7)
Dividends paid to noncontrolling interests on subsidiary common stock	(49.6)				(49.6)
Dividends paid on convertible preferred stock	(5.4)		(5.4)
Balance at Dec. 31, 2008	1,293.4	2,693.6	(32.4)	(1,620.6)	252.8
Issuance of common stock	27.2	27.2
Reissuance of common stock	5.8	5.8
Comprehensive income:
Net earnings	197.8		161.8		36.0	197.8
Foreign currency translation adjustments	200.5			228.9	(28.4)	200.5
Pension and other postretirement benefit adjustments, net of tax	50.4			50.4		50.4
Change in fair value of derivative instruments, net of tax	23.5			23.5		23.5
Total comprehensive income (loss)	472.2					472.2
Dividends paid to noncontrolling interests on subsidiary common stock	(62.2)				(62.2)
Balance at Dec. 31, 2009	$ 1,736.4	$ 2,726.6	$ 129.4	$ (1,317.8)	$ 198.2

CONSOLIDATED CASH FLOWS (USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2009	Dec. 31, 2008	Dec. 31, 2007
Operating activities:
Net earnings	$ 197.8	$ 328.5	$ 1,400.3
Net earnings attributable to noncontrolling interests	(36.0)	(70.2)	(59.7)
Net earnings of discontinued operations			(2.8)
Gain on sale of discontinued operations		(6.8)	(1,038.5)
Non-cash charges (credits):
Depreciation	374.8	431.0	423.4
Amortization of intangibles and other deferred items	21.1	28.9	28.9
Amortization of finance fees and debt discount	10.4	7.9	8.6
Deferred tax provision	51.9	21.0	3.2
Non-cash tax benefit	(47.9)
Restructuring and asset impairment	213.6	133.3	100.3
Future asbestos-related costs	180.0	250.0	115.0
Other	107.2	140.0	78.7
Asbestos-related payments	(190.3)	(210.2)	(347.1)
Cash paid for restructuring activities	(68.3)	(48.9)	(17.8)
Change in non-current operating assets	21.3	1.4	(7.4)
Reduction of non-current liabilities	(178.9)	(90.1)	(67.6)
Change in components of working capital	143.3	(158.6)	36.2
Cash provided by continuing operating activities	800.0	757.2	653.7
Cash provided by discontinued operating activities			11.3
Total cash provided by operating activities	800.0	757.2	665.0
Investing activities:
Additions to property, plant, and equipment - continuing	(427.6)	(361.7)	(292.5)
Additions to property, plant, and equipment - discontinued			(23.3)
Acquisitions, net of cash acquired	(5.4)		(9.8)
Advances to equity affiliate - net	1.6	(1.6)
Net cash proceeds from divestitures and other	13.4	(13.9)	1,770.0
Cash provided by (utilized in) investing activities	(418.0)	(377.2)	1,444.4
Financing activities:
Additions to long-term debt	1,080.1	686.4	406.4
Repayments of long-term debt	(831.6)	(945.4)	(2,393.2)
Increase (decrease) in short-term loans	(79.4)	(20.6)	(21.5)
Net receipts (payments) for hedging activity	14.3	(45.2)	5.7
Payment of finance fees	(14.0)		(6.3)
Dividends paid to noncontrolling interests	(62.2)	(49.6)	(28.6)
Convertible preferred stock dividends		(5.4)	(21.5)
Issuance of common stock	7.0	14.5	62.8
Cash utilized in financing activities	114.2	(365.3)	(1,996.2)
Effect of exchange rate fluctuations on cash	(64.0)	(22.9)	51.8
Increase (decrease) in cash	432.2	(8.2)	165.0
Cash at beginning of year	379.5	387.7	222.7
Cash at end of year	$ 811.7	$ 379.5	$ 387.7

Significant Accounting Policies

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Significant Accounting Policies

1. Significant Accounting Policies

Basis of Consolidated Statements The consolidated financial statements of Owens-Illinois, Inc. (“Company”) include the accounts of its subsidiaries. Newly acquired subsidiaries have been included in the consolidated financial statements from dates of acquisition.

The Company uses the equity method of accounting for investments in which it has a significant ownership interest, generally 20% to 50%. Other investments are accounted for at cost. The Company monitors other than temporary declines in fair value and records reductions in carrying values when appropriate.

Results of operations for the plastics packaging business sold during 2007 have been presented as a discontinued operation. The format of the Company’s 2007 consolidated income statements has been reclassified to conform to the presentation used in the current period. The individual captions within the financial statements did not change.

The format of the Company’s consolidated cash flows for the years ended December 31, 2008 and 2007 has been reclassified to conform to the 2009 presentation. Amounts related to cash paid for restructuring activities have been reclassified from changes in working capital and non-current liabilities and are now shown separately.

The Company has evaluated subsequent events through February 10, 2010, the date the financial statements were issued.

Newly Adopted Financial Statement Pronouncements Effective January 1, 2009, the Company adopted the provisions of a new accounting standard which changed the presentation of noncontrolling interests in subsidiaries. The format of the Company’s consolidated results of operations, consolidated share owners’ equity, and consolidated cash flows for the years ended December 31, 2008 and 2007, and consolidated balance sheet at December 31, 2008 have been reclassified to conform to the new presentation which is required to be applied retrospectively.

Effective January 1, 2009, the Company adopted the provisions of a new accounting standard which required the Company to allocate earnings to unvested restricted shares outstanding during the period. Earnings per share for the years ended December 31, 2008 and 2007 were restated in accordance with the new provisions which are required to be applied retrospectively.

Nature of Operations The Company is a leading manufacturer of glass container products. The Company’s principal product lines are glass containers for the food and beverage industries. The Company has glass container operations located in 21 countries. The principal markets and operations for the Company’s products are in Europe, North America, South America, and Australia.

Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management of the Company to make estimates and assumptions that affect certain amounts reported in the financial statements and accompanying notes. Actual results may differ from those estimates, at which time the Company would revise its estimates accordingly. For further information on certain of the Company’s significant estimates relative to contingent liabilities, see Note 18.

Cash The Company defines “cash” as cash and time deposits with maturities of three months or less when purchased. Outstanding checks in excess of funds on deposit are included in accounts payable.

Fair Value Measurements Fair value is defined as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability (exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants. Generally accepted accounting principles defined a three-tier fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows:

Level 1: Observable inputs such as quoted prices in active markets;

Level 2: Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

Level 3: Unobservable inputs for which there is little or no market data, which requires the Company to develop assumptions.

The carrying amounts reported for cash, short-term investments and short-term loans approximate fair value. In addition, carrying amounts approximate fair value for certain long-term debt obligations subject to frequently redetermined interest rates. Fair values for the Company’s significant fixed rate debt obligations are generally based on published market quotations.

The Company’s derivative assets and liabilities consist of interest rate swaps, natural gas forwards, and foreign exchange option and forward contracts. The Company uses an income approach to valuing these contracts. Interest rate yield curves, natural gas forward rates, and foreign exchange rates are the significant inputs into the valuation models. These inputs are observable in active markets over the terms of the instruments the Company holds, and accordingly, the Company classifies its derivative assets and liabilities as Level 2 in the hierarchy. The Company also evaluates counterparty risk in determining fair values.

Derivative Instruments The Company uses currency swaps, interest rate swaps, options, and commodity futures contracts to manage risks generally associated with foreign exchange rate, interest rate and commodity market volatility. Derivative financial instruments are included on the balance sheet at fair value. Whenever possible, derivative instruments are designated as and are effective as hedges, in accordance with accounting principles generally accepted in the United States. If the underlying hedged transaction ceases to exist, all changes in fair value of the related derivatives that have not been settled are recognized in current earnings. The Company does not enter into derivative financial instruments for trading purposes and is not a party to leveraged derivatives. Cash flows from fair value hedges of debt and short-term forward exchange contracts are classified as a financing activity. Cash flows of currency swaps, interest rate swaps, and commodity futures contracts are classified as operating activities. See Note 9 for additional information related to derivative instruments.

Inventory Valuation The Company values most U.S. inventories at the lower of last-in, first-out (LIFO) cost or market. Other inventories are valued at the lower of standard costs (which approximate average costs) or market.

Goodwill Goodwill represents the excess of cost over fair value of assets of businesses acquired. Goodwill is evaluated annually, as of October 1, for impairment or more frequently if an impairment indicator exists.

Intangible Assets and Other Long-Lived Assets Intangible assets are amortized over the expected useful life of the asset. Amortization expense directly attributed to the manufacturing of the Company’s products is included in manufacturing, shipping, and delivery. Amortization expense related to non-manufacturing activities is included in selling and administrative and other. The Company evaluates the recoverability of intangible assets and other long-lived assets based on undiscounted projected cash flows, excluding interest and taxes, when factors indicate that impairment may exist. If impairment exists, the asset is written down to fair value.

Property, Plant, and Equipment Property, plant, and equipment (“PP&E”) is carried at cost and includes expenditures for new facilities and equipment and those costs which substantially increase the useful lives or capacity of existing PP&E. In general, depreciation is computed using the straight-line method and recorded over the estimated useful life of the asset. Factory machinery and equipment is depreciated over periods ranging from 5 to 25 years with the majority of such assets (principally glass-melting furnaces and forming machines) depreciated over 7-15 years. Buildings and building equipment are depreciated over periods ranging from 10 to 50 years. Depreciation expense directly attributed to the manufacturing of the Company’s products is included in manufacturing, shipping, and delivery. Depreciation expense related to non-manufacturing activities is included in selling and administrative. Maintenance and repairs are expensed as incurred. Costs assigned to PP&E of acquired businesses are based on estimated fair values at the date of acquisition. The Company evaluates the recoverability of property, plant, and equipment based on undiscounted projected cash flows, excluding interest and taxes, when factors indicate that impairment may exist. If impairment exists, the asset is written down to fair value.

Revenue Recognition The Company recognizes sales, net of estimated discounts and allowances, when the title to the products and risk of loss are transferred to customers. Provisions for rebates to customers are provided in the same period that the related sales are recorded.

Shipping and Handling Costs Shipping and handling costs are included with manufacturing, shipping, and delivery costs in the Consolidated Results of Operations.

Income Taxes on Undistributed Earnings In general, the Company plans to continue to reinvest the undistributed earnings of foreign subsidiaries and foreign corporate joint ventures accounted for by the equity method. Accordingly, taxes are provided only on that amount of undistributed earnings in excess of planned reinvestments.

Foreign Currency Translation The assets and liabilities of substantially all subsidiaries and associates are translated at current exchange rates and any related translation adjustments are recorded directly in share owners’ equity.

Accounts Receivable Receivables are stated at amounts estimated by management to be the net realizable value. The Company charges off accounts receivable when it becomes apparent based upon age or customer circumstances that amounts will not be collected.

Allowance for Doubtful Accounts The allowance for doubtful accounts is established through charges to the provision for bad debts. The Company evaluates the adequacy of the allowance for doubtful accounts on a periodic basis. The evaluation includes historical trends in collections and write-offs, management’s judgment of the probability of collecting accounts and management’s evaluation of business risk.

New Accounting Standards In June 2009, the FASB issued a new standard which amends certain guidance for determining whether an entity is a variable interest entity (VIE). An enterprise is required to perform an analysis to determine whether the Company’s variable interests give it a controlling financial interest in a VIE. A company would be required to assess whether it has an implicit financial responsibility to ensure that a VIE operates as designed when determining whether it has the power to direct the activities of the VIE that most significantly impact the entity’s economic performance. In addition, the new provisions require ongoing reassessments of whether an enterprise is the primary beneficiary of a VIE. The new provisions are effective for financial statements issued for fiscal years beginning after November 15, 2009. The Company does not expect the adoption of this Statement to have an impact on its results of operations, financial position or cash flows.

Stock Options and Other Stock-Based Compensation The Company has five non-qualified plans, which are described more fully in Note 13. Costs resulting from all share-based payment transactions are required to be recognized in the financial statements. A public entity is required to measure the cost of employee services received in exchange for an award of equity instruments based on the grant-date fair value of the award. That cost is recognized over the required service period (usually the vesting period). No compensation cost is recognized for equity instruments for which employees do not render the required service.

The fair value of each option grant is estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

	2009		2008		2007
Range of expected lives of options (years)	4.75		4.75		4.75
Range of expected stock price volatilities	42.0%-52.0	%	29.0%-39.8	%	37.1%-40.0	%
Weighted average expected stock price volatilities	46.3	%	31.4	%	39.9	%
Range of risk-free interest rates	1.3%-2.1	%	1.5%-3.7	%	4.1%-4.6	%
Expected dividend yield	0.0	%	0.0	%	0.0	%

The expected life of options is based on the assumption that, on average, options will be exercised at the mid-point between the vesting date and the expiration date. The expected stock price volatility is determined by reference to historical prices over a period equal to the expected life.

The fair value of other equity awards, consisting of restricted shares and performance vested restricted share units, is equal to the quoted market value at the time of grant.

Earnings Per Share

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Earnings Per Share

2. Earnings Per Share The following table sets forth the computation of basic and diluted earnings per share:

Years ended December 31,	2009			2008			2007
Numerator:
Net earnings attributable to the Company	$	161.8		$	258.3		$	1,340.6
Convertible preferred stock dividends				(5.4		)	(21.5		)
Net earnings attributable to participating securities	(0.6		)	(2.6		)	(13.9		)
Numerator for basic earnings per share - income available to common share owners	$	161.2		$	250.3		$	1,305.2
Denominator:
Denominator for basic earnings per share - weighted average shares outstanding	167,687,408			163,177,874			154,215,269
Effect of dilutive securities:
Convertible preferred stock				2,147,339			8,589,355
Stock options and other	2,852,282			4,352,076			4,962,683
Denominator for diluted earnings per share - adjusted weighted average shares and assumed exchanges of preferred stock for common stock	170,539,690			169,677,289			167,767,307
Basic earnings per share:
Earnings from continuing operations	$	0.96		$	1.49		$	1.78
Net earnings of discontinued operations							0.02
Gain on sale of discontinued operations				0.04			6.66
Net earnings	$	0.96		$	1.53		$	8.46
Diluted earnings per share:
Earnings from continuing operations	$	0.95		$	1.48		$	1.78
Net earnings of discontinued operations							0.02
Gain on sale of discontinued operations				0.04			6.19
Net earnings	$	0.95		$	1.52		$	7.99

The convertible preferred stock was included in the computation of diluted earnings per share for 2008, to the extent outstanding during 2008, and 2007 on an “if converted” basis since the result was dilutive. For purposes of this computation, the preferred stock dividends were not subtracted from the numerator. Options to purchase 994,834, 241,711, and 862,906 weighted average shares of common stock which were outstanding during 2009, 2008, and 2007, respectively, were not included in the computation of diluted earnings per share because the options’ exercise prices were greater than the average market price of the common shares.

Effective January 1, 2009, the Company adopted the provisions of a new accounting standard, which addresses whether instruments granted in share-based payment awards are participating securities prior to vesting and, therefore, must be included in the earnings allocation in calculating earnings per share under the two-class method. The new provisions require that unvested share-based payment awards that contain non-forfeitable rights to dividends be treated as participating securities in calculating earnings per share. The Company was required to allocate earnings to unvested restricted shares outstanding during the period. Basic earnings per share for the years ended December 31, 2008 and 2007 were reduced by $0.02 and $0.09 per share, respectively, in accordance with the new provisions which require retrospective application. There was no impact on basic earnings per share for the year ended December 31, 2009 or diluted earnings per share in any period.

Supplemental Cash Flow Information

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Supplemental Cash Flow Information

3. Supplemental Cash Flow Information Changes in the components of working capital related to operations (net of the effects related to acquisitions and divestitures) were as follows:

	2009			2008			2007
Decrease (increase) in current assets:
Receivables	$	(3.3	)	$	57.8		$	(16.5	)
Inventories	151.9			(74.1		)	63.0
Prepaid expenses and other	(18.4		)	35.2			(21.4		)
Increase (decrease) in current liabilities:
Accounts payable	32.6			(56.7		)	(2.9		)
Accrued liabilities	(17.7		)	(52.9		)	(63.2		)
Salaries and wages	20.4			(37.2		)	38.3
U.S. and foreign income taxes	(22.2		)	(30.7		)	24.5
	$	143.3		$	(158.6	)	$	21.8
Continuing operations	$	143.3		$	(158.6	)	$	36.2
Discontinued operations							(14.4		)
	$	143.3		$	(158.6	)	$	21.8

Interest paid in cash, including note repurchase premiums in 2009 and 2007, aggregated $195.1 million for 2009, $251.9 million for 2008, and $452.4 million for 2007.

Income taxes paid (received) in cash were as follows:

	2009			2008			2007
Domestic	$	(1.7	)	$	(1.2	)	$	31.8
Foreign	196.0			162.5			151.1
	$	194.3		$	161.3		$	182.9

Equity Investments

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Equity Investments

5. Equity Investments Summarized information pertaining to the Company’s equity associates follows:

	2009		2008
At end of year:
Equity in undistributed earnings:
Foreign	$	44.5	$	32.0
Domestic	25.8		19.6
Total	$	70.3	$	51.6

	2009		2008		2007
For the year:
Equity in earnings:
Foreign	$	12.5	$	14.1	$	5.3
Domestic	40.1		36.7		28.8
Total	$	52.6	$	50.8	$	34.1

Dividends received	$	33.8	$	24.5	$	21.7

Summarized combined financial information for equity associates is as follows:

	2009		2008
At end of year:
Current assets	$	218.0	$	208.3
Non-current assets	314.1		325.9
Total assets	532.1		534.2

Current liabilities	138.5		167.5
Other liabilities and deferred items	145.9		137.9
Total liabilities and deferred items	284.4		305.4
Net assets	$	247.7	$	228.8

	2009		2008		2007 (a)
For the year:
Net sales	$	548.6	$	635.8	$	535.9
Gross profit	$	199.6	$	227.5	$	176.5
Net earnings	$	158.0	$	153.9	$	112.4

(a) Amounts for 2007 exclude the Company’s Caribbean investment due to the impairment recorded during 2007.

The Company’s significant equity method investments include: (1) 50% of the common shares of Vetri Speciali SpA, a specialty glass manufacturer; (2) a 25% partnership interest in General Chemical Soda Ash (Partners), a soda ash supplier; and (3) a 50% partnership interest in Rocky Mountain Bottle Company, a glass container manufacturer.

- Definition

Equity investment disclosure, or group of investments for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20% of the voting stock and the investment is accounted for using the equity method, and the reasons why it is.

+ References+ Details

Debt

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Debt

6. Debt The following table summarizes the long-term debt of the Company at December 31, 2009 and 2008:

	2009		2008
Secured Credit Agreement:
Revolving Credit Facility:
Revolving Loans	$	—	$	18.7
Term Loans:
Term Loan A (160.0 million AUD at Dec. 31, 2009)	143.9		155.7
Term Loan B	189.5		191.5
Term Loan C (110.8 million CAD at Dec. 31, 2009)	105.4		90.9
Term Loan D (€189.5 million at Dec. 31, 2009)	273.5		269.6
Senior Notes:
8.25%, due 2013	460.4		470.0
6.75%, due 2014	400.0		400.0
6.75%, due 2014 (€225 million)	324.7		316.8
7.375%, due 2016	582.1
6.875%, due 2017 (€300 million)	432.9		422.4
Senior Debentures:
7.50%, due 2010	28.3		259.5
7.80%, due 2018	250.0		250.0
Other	116.5		113.4
Total long-term debt	3,307.2		2,958.5
Less amounts due within one year	49.7		18.2
Long-term debt	$	3,257.5	$	2,940.3

On June 14, 2006, the Company’s subsidiary borrowers entered into the Secured Credit Agreement (the “Agreement”). At December 31, 2009, the Agreement included a $900.0 million revolving credit facility, a 160.0 million Australian dollar term loan, and a 110.8 million Canadian dollar term loan, each of which has a final maturity date of June 15, 2012. It also included a $189.5 million term loan and a €189.5 million term loan, each of which has a final maturity date of June 14, 2013. During 2009, the Company’s subsidiary borrowers repaid 65.0 million Australian dollars, $2.0 million and €2.0 million of term loans under the Agreement.

As a result of the 2008 bankruptcy of Lehman Brothers Holdings Inc. and several of its subsidiaries, the Company believes that the maximum amount available under the revolving credit facility was reduced by $32.3 million. After further deducting amounts attributable to letters of credit and overdraft facilities that are supported by the revolving credit facility, at December 31, 2009 the Company’s subsidiary borrowers had unused credit of $760.0 million available under the Agreement.

The Agreement contains various covenants that restrict, among other things and subject to certain exceptions, the ability of the Company to incur certain liens, make certain investments and acquisitions, become liable under contingent obligations in certain defined instances only, make restricted junior payments, make certain asset sales within guidelines and limits, make capital expenditures beyond a certain threshold, engage in material transactions with shareholders and affiliates, participate in sale and leaseback financing arrangements, alter its fundamental business, amend certain outstanding debt obligations, and prepay certain outstanding debt obligations.

The Agreement also contains one financial maintenance covenant, a Leverage Ratio, that requires the Company not to exceed a ratio calculated by dividing consolidated total debt, less cash and cash equivalents, by Consolidated Adjusted EBITDA, as defined in the Agreement. The Leverage Ratio could restrict the ability of the Company to undertake additional financing to the extent that such financing would cause the Leverage Ratio to exceed the specified maximum.

Failure to comply with these covenants and restrictions could result in an event of default under the Agreement. In such an event, the Company could not request borrowings under the revolving facility, and all amounts outstanding under the Agreement, together with accrued interest, could then be declared immediately due and payable. If an event of default occurs under the Agreement and the lenders cause all of the outstanding debt obligations under the Agreement to become due and payable, this would result in a default under a number of other outstanding debt securities and could lead to an acceleration of obligations related to these debt securities. A default or event of default under the Agreement, indentures or agreements governing other indebtedness could also lead to an acceleration of debt under other debt instruments that contain cross acceleration or cross-default provisions.

The leverage ratio also determines pricing under the Agreement. The interest rate on borrowings under the Agreement is, at the Company’s option, the Base Rate or the Eurocurrency Rate, as defined in the Agreement. These rates include a margin linked to the leverage ratio and the borrowers’ senior secured debt rating. The margins range from 0.875% to 1.75% for Eurocurrency Rate loans and from -0.125% to 0.75% for Base Rate loans. In addition, a facility fee is payable on the revolving credit facility commitments ranging from 0.20% to 0.50% per annum linked to the leverage ratio. The weighted average interest rate on borrowings outstanding under the Agreement at December 31, 2009 was 2.40%. As of December 31, 2009, the Company was in compliance with all covenants and restrictions in the Agreement. In addition, the Company believes that it will remain in compliance and that its ability to borrow funds under the Agreement will not be adversely affected by the covenants and restrictions.

Borrowings under the Agreement are secured by substantially all of the assets of the Company’s domestic subsidiaries and certain foreign subsidiaries, which have a book value of approximately $2.7 billion. Borrowings are also secured by a pledge of intercompany debt and equity in most of the Company’s domestic subsidiaries and stock of certain foreign subsidiaries. All borrowings under the agreement are guaranteed by substantially all domestic subsidiaries of the Company for the term of the Agreement.

During the second quarter of 2008, the Company used cash from operations and borrowings under the Agreement to retire $250 million principal amount of 7.35% Senior Notes which matured in May 2008.

During May 2009, a subsidiary of the Company issued senior notes with a face value of $600.0 million at 96.72% of face value for an effective interest rate of 8.00%. The notes bear interest at 7.375% and are due May 15, 2016. The notes are guaranteed by substantially all of the Company’s domestic subsidiaries. The net proceeds, after deducting commissions and expenses from the notes, approximated $568 million and were used to purchase in a tender offer $221.9 million of the $250 million principal amount of 7.50% Senior Debentures due May 2010 and to reduce borrowings under the revolving credit facility. The balance of the proceeds increased cash. As a part of the issuance of these notes and the related tender offer, the Company recorded additional interest charges in 2009 of $5.2 million for note repurchase premiums and the related write-off of unamortized finance fees, net of a gain from the termination of interest rate swap agreements related to the notes.

During October 2006, the Company entered into a European accounts receivable securitization program, which had a limit of €250 million at December 31, 2009. The program extends through October 2011, subject to annual renewal of backup credit lines. In addition, the Company participates in a receivables financing program in the Asia Pacific region with a revolving funding commitment of 89 million Australian dollars and 10 million New Zealand dollars that expire February 2010 and November 2010, respectively.

Information related to the Company’s accounts receivable securitization program as of December 31, 2009 and 2008 is as follows:

	2009			2008

Balance (included in short-term loans)	$	289.0		$	293.7

Weighted average interest rate	2.52		%	5.31		%

The Company capitalized $16.8 million and $25.6 million in 2009 and 2008, respectively, under capital lease obligations with the related financing recorded as long term debt. These amounts are included in other in the long-term debt table above.

Annual maturities for all of the Company’s long-term debt through 2014 are as follows: 2010, $49.7 million; 2011, $136.1 million; 2012, $165.4 million; 2013, $932.3 million; and 2014, $736.4 million.

Fair values at December 31, 2009, of the Company’s significant fixed rate debt obligations were as follows:

	Principal Amount		Indicated	Fair Value
	(millions of		Market	(millions of
	dollars)		Price	dollars)
Senior Notes:
8.25%, due 2013	$	450.0	103.35	$	465.1
6.75%, due 2014	400.0		102.25	409.0
6.75%, due 2014 (€225 million)	324.7		98.33	319.3
7.375%, due 2016	600.0		104.00	624.0
6.875%, due 2017 (€300 million)	432.9		96.97	419.8
Senior Debentures:
7.50%, due 2010	28.1		100.40	28.2
7.80%, due 2018	250.0		101.25	253.1

Derivative Instruments

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Derivative Instruments

9. Derivative Instruments The Company has certain derivative assets and liabilities which consist of interest rate swaps, natural gas forwards, and foreign exchange option and forward contracts. The Company records derivative assets and liabilities at fair value and classifies them as “Level 2” in the fair value hierarchy.

Interest Rate Swaps Designated as Fair Value Hedges

In the fourth quarter of 2003 and the first quarter of 2004, the Company entered into a series of interest rate swap agreements with a total notional amount of $700 million that were to mature in 2010 and 2013. The swaps were executed in order to: (i) convert a portion of the senior notes and senior debentures fixed-rate debt into floating-rate debt; (ii) maintain a capital structure containing appropriate amounts of fixed and floating-rate debt; and (iii) reduce net interest payments and expense in the near-term.

The Company’s fixed-to-floating interest rate swaps were accounted for as fair value hedges. Because the relevant terms of the swap agreements matched the corresponding terms of the notes, there was no hedge ineffectiveness. Accordingly, the Company recorded the net of the fair market values of the swaps as a long-term asset (liability) along with a corresponding net increase (decrease) in the carrying value of the hedged debt.

For derivative instruments that are designated and qualify as fair value hedges, the change in the fair value of the derivative instrument related to the future cash flows (gain or loss on the derivative) as well as the offsetting change in the fair value of the hedged item attributable to the hedged risk are recognized in current earnings. The Company includes the gain or loss on the hedged items (i.e. long-term debt) in the same line item (interest expense) as the offsetting loss or gain on the related interest rate swaps.

During the second quarter of 2009, the Company completed a tender offer for its $250 million senior debentures due 2010. As a result of the tender offer, the Company extinguished $221.9 million of the senior debentures and terminated the related interest rate swap agreements for proceeds of $5.0 million. The Company recognized $4.4 million of the proceeds as a reduction of interest expense upon the termination of the interest rate swap agreements, while the remaining $0.6 million is recorded as an adjustment to the debt and will be recognized as a reduction of interest expense over the remaining life of the outstanding senior debentures due 2010. See Note 6 for additional information.

During the second quarter of 2009, the Company’s interest rate swaps related to the $450 million senior notes due 2013 were terminated. The Company received proceeds of $12.4 million which were recorded as an adjustment to debt and will be recognized as a reduction of interest expense over the remaining life of the senior notes due 2013.

As of December 31, 2009, the balance of unamortized proceeds from terminated interest rate swaps included in long-term debt was $10.6 million.

The effect of the interest rate swaps on the results of operations for the year ended December 31, 2009 and 2008 is as follows:

	Amount of Gain (Loss) Recognized in Interest Expense
	2009			2008

Interest rate swaps	$	(11.0	)	$	26.1
Related long-term debt	11.0			(26.1		)
Proceeds recognized and amortized for terminated interest rate swaps	6.7
Net impact on interest expense	$	6.7		$	—

Commodity Futures Contracts Designated as Cash Flow Hedges

The Company enters into commodity futures contracts related to forecasted natural gas requirements, the objectives of which are to limit the effects of fluctuations in the future market price paid for natural gas and the related volatility in cash flows. The Company continually evaluates the natural gas market with respect to its forecasted usage requirements over the next twelve to twenty-four months and periodically enters into commodity futures contracts in order to hedge a portion of its usage requirements over that period. At December 31, 2009, the Company had entered into commodity futures contracts covering approximately 4,800,000 MM BTUs over that period.

The Company accounts for the above futures contracts as cash flow hedges at December 31, 2009 and recognizes them on the balance sheet at fair value. The effective portion of changes in the fair value of a derivative that is designated as, and meets the required criteria for, a cash flow hedge is recorded in the Accumulated Other Comprehensive Income component of share owners’ equity (“OCI”) and reclassified into earnings in the same period or periods during which the underlying hedged item affects earnings. At December 31, 2009, an unrecognized loss of $1.3 million (pretax) related to the commodity futures contracts was included in Accumulated OCI, and will be reclassified into earnings over the next twelve to twenty-four months. Any material portion of the change in the fair value of a derivative designated as a cash flow hedge that is deemed to be ineffective is recognized in current earnings. The ineffectiveness related to these natural gas hedges for the year ended December 31, 2009 and 2008 was not material.

The effect of the commodity futures contracts on the results of operations for the year ended December 31, 2009 and 2008 is as follows:

					Amount of Gain (Loss)
					Reclassified from
Amount of Gain (Loss)					Accumulated OCI into
Recognized in OCI on					Income (reported in
Commodity Futures Contracts					manufacturing, shipping, and
(Effective Portion)					delivery) (Effective Portion)
2009		2008			2009			2008

$	(24.8)	$	(27.2	)	$	(60.9	)	$	5.7

Senior Notes Designated as Net Investment Hedge

During December 2004, a U.S. subsidiary of the Company issued Senior Notes totaling €225 million. These notes were designated by the Company’s subsidiary as a hedge of a portion of its net investment in a non-U.S. subsidiary with a Euro functional currency. Because the amount of the Senior Notes matches the hedged portion of the net investment, there is no hedge ineffectiveness. Accordingly, the Company recorded the impact of changes in the foreign currency exchange rate on the Euro-denominated notes in OCI. The amount recorded in OCI will be reclassified into earnings when the Company sells or liquidates its net investment in the non-U.S. subsidiary.

The effect of the net investment hedge on the results of operations for the year ended December 31, 2009 and 2008 is as follows:

Amount of Gain (Loss)

Location of Gain (Loss)

Reclassified from Accumulated

Recognized in OCI

Reclassified from Accumulated

OCI into Income

2009

2008

OCI into Income

2009

2008

(8.8)

15.2

N/A

—

Forward Exchange Contracts not Designated as Hedging Instruments

The Company’s subsidiaries may enter into short-term forward exchange or option agreements to purchase foreign currencies at set rates in the future. These agreements are used to limit exposure to fluctuations in foreign currency exchange rates for significant planned purchases of fixed assets or commodities that are denominated in currencies other than the subsidiaries’ functional currency. Subsidiaries may also use forward exchange agreements to offset the foreign currency risk for receivables and payables, including intercompany receivables and payables, not denominated in, or indexed to, their functional currencies. The Company records these short-term forward exchange agreements on the balance sheet at fair value and changes in the fair value are recognized in current earnings.

At December 31, 2009, various subsidiaries of the Company had outstanding forward exchange and option agreements denominated in various currencies covering the equivalent of approximately $1.0 billion related primarily to intercompany transactions and loans.

The effect of the forward exchange contracts on the results of operations for the year ended December 31, 2009 and 2008 is as follows:

	Amount of Loss
Location of Loss	Recognized in Income on
Recognized in Income on	Forward Exchange Contracts
Forward Exchange Contracts	2009			2008

Other expense	$	(8.3	)	$	(4.2	)

Balance Sheet Classification

The Company records the fair values of derivative financial instruments on the balance sheet as follows: (1) receivables if the instrument has a positive fair value and maturity within one year, (2) deposits, receivables, and other assets if the instrument has a positive fair value and maturity after one year, (3) accounts payable and other current liabilities if the instrument has a negative fair value and maturity within one year, and (4) other liabilities if the instrument has a negative fair value and maturity after one year. The following table shows the amount and classification of the Company’s derivatives as of December 31, 2009 and 2008:

	2009			2008
	Balance Sheet	Fair		Balance Sheet	Fair
	Location	Value		Location	Value
Asset Derivatives:
Derivatives designated as hedging instruments
Interest rate swaps				Deposits, receivables, and other assets	$	29.4
Commodity futures contracts	Receivables	$	0.4
Commodity futures contracts	Other accrued liabilities	0.1
Total derivatives designated as hedging instruments		0.5			29.4

Derivatives not designated as hedging instruments
Foreign exchange contracts	Receivables	6.0		Receivables	19.4
Foreign exchange contracts	Other accrued liabilities	0.2
Total derivatives not designated as hedging instruments		6.2			19.4

Total asset derivatives		$	6.7		$	48.8

Liability Derivatives:
Derivatives designated as hedging instruments
Commodity futures contracts	Other accrued liabilities	$	1.8	Other accrued liabilities	$	37.4
Total derivatives designated as hedging instruments		1.8			37.4

Derivatives not designated as hedging instruments
Foreign exchange contracts	Other accrued liabilities	2.9		Receivables	0.4
Foreign exchange contracts				Other accrued liabilities	11.6
Foreign exchange contracts				Other liabilities	0.1
Total derivatives not designated as hedging instruments		2.9			12.1

Total liability derivatives		$	4.7		$	49.5

Accumulated Other Comprehensive Income (Loss)

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Accumulated Other Comprehensive Income (Loss)

10. Accumulated Other Comprehensive Income (Loss) The components of comprehensive income are: (a) net earnings; (b) change in fair value of certain derivative instruments; (c) pension and other postretirement benefit adjustments; and (d) foreign currency translation adjustments. The net effect of exchange rate fluctuations generally reflects changes in the relative strength of the U.S. dollar against major foreign currencies between the beginning and end of the year.

The following table lists the beginning balance, yearly activity and ending balance of each component of accumulated other comprehensive income (loss):

	Net Effect of Exchange Rate Fluctuations			Deferred Tax Effect for Translation		Unfunded Pension Liability			Change in Certain Derivative Instruments			Employee Benefit Plans			Total Accumulated Comprehensive Income (Loss)

Balance on January 1, 2007	$	168.0		$	12.7	$	(122.9	)	$	(34.9	)	$	(617.1	)	$	(594.2	)

2007 Change	325.3								28.2			79.1			432.6
Translation effect												(6.7		)	(6.7		)
Reclass						122.9			2.2			(125.1		)
Tax effect												(8.6		)	(8.6		)
Balance on Dec. 31, 2007	493.3			12.7		—			(4.5		)	(678.4		)	(176.9		)

2008 Change	(431.9		)						(32.9		)	(1,080.1		)	(1,544.9		)
Translation effect												46.1			46.1
Tax effect												55.1			55.1
Balance on Dec. 31, 2008	61.4			12.7		—			(37.4		)	(1,657.3		)	(1,620.6		)

2009 Change	228.9								36.1			133.5			398.5
Translation effect												(33.7		)	(33.7		)
Tax effect												(14.1		)	(14.1		)
Intraperiod tax allocation									(12.6		)	(35.3		)	(47.9		)
Balance on Dec. 31, 2009	$	290.3		$	12.7	$	—		$	(13.9	)	$	(1,606.9	)	$	(1,317.8	)

Exchange rate fluctuations in 2009 include a loss of $132.5 million related to the Company’s decision to translate the balance sheets of its Venezuelan subsidiaries using the parallel market rate at December 31, 2009 instead of the historic official rate. See Note 22 to the Consolidated Financial Statements for further information.

The intraperiod tax allocation in 2009 related to a non-cash tax benefit transferred to continuing operations. See Note 11 to the Consolidated Financial Statements for further information.

- Definition

This label may include the following: 1) the amount of income tax expense or benefit allocated to each component of other comprehensive income, including reclassification adjustments, 2) the reclassification adjustments for each classification of other comprehensive income and 3) the ending accumulated balances for each component of comprehensive income. Components of comprehensive income include: (1) foreign currency translation adjustments; (2) gains and losses on foreign currency transactions that are designated as, and are effective as, economic hedges of a net investment in a foreign entity; (3) gains and losses on intercompany foreign currency transactions that are of a long-term-investment nature, when the entities to the transaction are consolidated, combined, or accounted for by the equity method in the reporting enterprise's financial statements; (4) change in the market value of a futures contract that qualifies as a hedge of an asset reported at fair value; (5) unrealized holding gains and losses on available-for-sale securities and that resulting from transfers of debt securities from the held-to-maturity category to the available-for-sale category; (6) a net loss recognized as an additional pension liability not yet recognized as net periodic pension cost; and (7) the net gain or loss and net prior service cost or credit for pension plans and other postretirement benefit plans.

+ References+ Details

Income Taxes

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Income Taxes

11. Income Taxes Deferred income taxes reflect: (1) the net tax effects of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes; and (2) carryovers and credits for income tax purposes.

Significant components of the Company’s deferred tax assets and liabilities at December 31, 2009 and 2008 are as follows:

	2009			2008
Deferred tax assets:
Accrued postretirement benefits	$	87.8		$	84.0
Asbestos-related liabilities	169.8			173.4
Foreign tax credit	312.0			295.5
Tax loss and credit carryovers	392.8			342.9
Capital loss carryovers	24.7			23.7
Alternative minimum tax credits	25.2			20.5
Accrued liabilities	169.5			159.3
Pension liability	127.2			181.0
Other	69.9			26.5
Total deferred tax assets	1,378.9			1,306.8

Deferred tax liabilities:
Property, plant, and equipment	148.7			151.1
Inventory	12.0			13.4
Other	67.3			49.3
Total deferred tax liabilities	228.0			213.8
Valuation allowance	(1,095.8		)	(1,047.5		)
Net deferred taxes	$	55.1		$	45.5

Deferred taxes are included in the Consolidated Balance Sheets at December 31, 2009 and 2008 as follows:

	2009			2008
Prepaid expenses	$	7.9		$	24.1
Deposits, receivables, and other assets	233.5			99.0
Deferred taxes	(186.3		)	(77.6		)
Net deferred taxes	$	55.1		$	45.5

The Company reviews the likelihood that it will realize the benefit of its deferred tax assets and therefore the need for valuation allowances on a quarterly basis, or whenever events indicate that a review is required. In determining the requirement for a valuation allowance, the historical and projected financial results of the legal entity or consolidated group recording the net deferred tax asset is considered, along with other positive and negative evidence.

The following details the valuation allowance activity:

Year	Beginning Year Balance			Foreign Currency Translation			Other Changes			Goodwill		Comprehensive Income			Ending Year Balance
2007	$	(1,262.3	)	$	(17.4	)	$	514.1		$	24.9	$	12.7		$	(728.0	)
2008	(728.0		)	21.6			(12.9		)	0.6		(328.8		)	(1,047.5		)
2009	(1,047.5		)	(12.6		)	(82.2		)			46.5			(1,095.8		)

In 2007, the Company reduced the valuation allowance recorded against its deferred tax assets in the United States by $466.0 million through the utilization of net operating and capital loss carryforwards.

The provision (benefit) for income taxes consists of the following:

	2009			2008			2007
Current:
U.S. Federal	$	0.7		$	(2.7	)	$	—
State	(0.5		)	0.6			31.1
Foreign	123.3			213.0			145.2
	123.5			210.9			176.3
Deferred:
U.S. Federal	(47.6		)	14.6			8.0
State	(2.5		)	(2.0		)	1.0
Foreign	54.1			8.4			(1.7		)
	4.0			21.0			7.3
Total:
U.S. Federal	(46.9		)	11.9			8.0
State	(3.0		)	(1.4		)	32.1
Foreign	177.4			221.4			143.5
	$	127.5		$	231.9		$	183.6

Total for continuing operations	$	127.5		$	236.7		$	147.8
Total for discontinued operations				(4.8		)	35.8
	$	127.5		$	231.9		$	183.6

The provision (benefit) for income taxes was calculated based on the following components of earnings (loss) before income taxes:

Continuing operations	2009			2008			2007
Domestic	$	(215.0	)	$	(140.6	)	$	(180.7	)
Foreign	540.3			699.0			687.3
	$	325.3		$	558.4		$	506.6

Discontinued operations	2009		2008		2007
Domestic	$	—	$	2.0	$	(1.1	)
Foreign					1.7
	$	—	$	2.0	$	0.6

A reconciliation of the provision (benefit) for income taxes based on the statutory U.S. Federal tax rate of 35% to the provision for income taxes is as follows:

	2009			2008			2007
Tax provision on pretax earnings from continuing operations at statutory U.S. Federal tax rate	$	113.9		$	195.4		$	177.3

Increase (decrease) in provision for income taxes due to:

Valuation allowance - U.S.	73.7			70.6			(466.0		)
Foreign Subsidiary ownership restructuring and incentives	10.8			35.1			535.9
Foreign source income taxable in the U.S.	6.1			11.3			29.3
Intraperiod tax allocation - U.S.	(47.9		)
Reversal non-U.S. valuation allowance	(0.9		)				(13.4		)
Foreign tax credit utilization							(40.4		)
State taxes, net of federal benefit				3.8			(2.9		)
Rate differences on non-U.S. earnings	(22.4		)	(55.3		)	(65.7		)
Adjustment for non-U.S. tax law changes	(0.6		)	(20.1		)	(9.9		)
Other items	(5.2		)	(4.1		)	3.6
Provision for income taxes	$	127.5		$	236.7		$	147.8

Income tax expense or benefit from continuing operations is generally determined without regard to other categories of earnings, such as other comprehensive income. An exception is provided when there is aggregate pretax income from other categories and a pretax loss from continuing operations in the current year. In such an instance, the tax benefit allocated to continuing operations is the amount by which the loss from continuing operations reduces the tax expenses recorded with respect to the other categories of earnings, even when a valuation allowance has been established against the deferred tax assets. In instances where a valuation allowance is established against current year losses, income from other sources, including other comprehensive income, is considered when determining whether sufficient future taxable income exists to realize the deferred tax assets. During 2009, certain pretax losses from continuing operations were partially offset by other comprehensive income as a result of the exception noted above, resulting in a reduction of the current year valuation allowance and a benefit allocated to income tax expense from continuing operations of $47.9 million.

In 2007 the Company implemented a plan to restructure the ownership and intercompany obligations of certain foreign subsidiaries. These actions resulted in the taxation of a significant portion of previously unremitted foreign earnings. The Company also realigned its debt service obligations to operations outside the U.S. in order to better balance its future operating cash flows with its global financing costs. The foreign earnings reported as taxable in the U.S. were offset by net operating loss carryforwards and foreign tax credits. Foreign tax credit carryforwards arising from the restructuring were fully offset by an increase in the valuation allowance.

The Company has recognized tax benefits as a result of incentives in certain non-U.S. jurisdictions which expire between 2012 to 2015.

At December 31, 2009, before valuation allowance, the Company has unused research tax credits of $17.8 million expiring from 2013 to 2029 and foreign tax credits of $312.0 million expiring in 2017. The Company also has unused alternative minimum tax credits of $25.2 million which do not expire and which will be available to offset future U.S. Federal income tax. Approximately $107.8 million of the deferred tax assets relate to net operating and capital loss carryforwards that can be carried over indefinitely with the remaining $140.3 million expiring between 2010 and 2029. As a result of U.S. tax legislation enacted in 2008 and 2009, the Company realized $2.3 million and $2.1 million, respectively, of benefits from its research and alternative minimum tax credit carryforwards. The related valuation on these credits was reduced accordingly.

At December 31, 2009, the Company’s equity in the undistributed earnings of foreign subsidiaries for which income taxes had not been provided approximated $1,823.4 million. The Company intends to reinvest these earnings indefinitely in the non-U.S. operations. It is not practicable to estimate the U.S. and foreign tax which would be payable should these earnings be distributed.

The Company records a liability for unrecognized tax benefits related to uncertain tax positions. In 2008, the Company reclassified $28.5 million of deferred tax assets related to general business credits and net operating losses that were previously offset by a full valuation allowance to the liability for unrecognized tax benefits. This balance sheet reclassification had no effect on share owners’ equity. The Company accrues interest and penalties associated with unrecognized tax benefits as a component of its income tax expense.

The following is a reconciliation of the Company’s total gross unrecognized tax benefits for the years ended December 31, 2009, 2008 and 2007:

	2009			2008			2007
Balance at January 1	$	103.1		$	53.0		$	45.8
Additions for tax positions of prior years	20.1			51.2			0.1
Reductions for tax positions of prior years				(2.1		)	(2.5		)
Additions based on tax positions related to the current year	17.1			6.1			11.0
Reductions due to the lapse of the applicable statute of limitations	(4.1		)	(3.1		)	(1.4		)
Foreign currency translation	(7.8		)
Reductions due to settlements				(2.0		)
Balance at December 31	$	128.4		$	103.1		$	53.0

At December 31, 2009 and 2008, accrued interest and penalties related to unrecognized tax benefits were $23.2 million and $14.5 million, respectively. Tax expense for the years ended December 31, 2009, 2008 and 2007 included interest and penalties of $10.6 million, $10.7 million and $0.6 million, respectively, on unrecognized tax benefits.

The unrecognized tax benefit liability, including interest and penalties, as of December 31, 2009 and 2008 was $151.6 million and $117.6 million, respectively. Approximately $97.3 million and $72.7 million as of December 31, 2009 and 2008, respectively, relate to unrecognized tax benefits, which if recognized, would impact the Company’s effective income tax rate. This amount differs from the gross unrecognized tax benefits presented in the table above because of the unrecognized tax benefits that would result in the utilization of certain tax attribute carryforwards that are currently subject to a full valuation allowance due to uncertainties about their future period utilization.

The Company and/or one of its subsidiaries files a U.S. federal income tax return as well as income tax returns in multiple state and foreign jurisdictions. Tax years through 1999 have been settled with the U.S. Internal Revenue Service. An IRS examination for the years 2007 and 2008 began in late 2009. Due to the existence of tax attribute carryforwards (which are currently offset by full valuation allowances) in the U.S., the Company treats certain post-1999 tax positions as unsettled because of the taxing authorities’ ability to modify these attributes. The 2000 tax year is the earliest open year for the Company’s other major tax jurisdictions.

The Company does not anticipate a significant change in the total amount of unrecognized income tax benefits within the next twelve months.

Stock Options and Other Stock Based Compensation

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Stock Options and Other Stock Based Compensation

13. Stock Options and Other Stock Based Compensation The Company has five nonqualified plans under which it has granted stock options, restricted shares and performance vested restricted share units: (1) the Stock Option Plan for Key Employees of Owens-Illinois, Inc.; (2) the Stock Option Plan for Directors of Owens-Illinois, Inc.; (3) the 1997 Equity Participation Plan of Owens-Illinois, Inc.; (4) the 2004 Equity Incentive Plan for Directors of Owens-Illinois, Inc.; and (5) the 2005 Equity Incentive Plan of Owens-Illinois, Inc. At December 31, 2009, there were 7,254,749 shares authorized and available for grants under these plans. Total compensation cost for all grants of shares and units under all of these plans was $20.2 million ($18.2 million after tax) for the year ended December 31, 2009. Total compensation cost for grants of shares and units was $21.4 million ($19.1 million after tax) in 2008 and $23.6 million ($21.9 million after tax) in 2007.

Stock Options

For options granted prior to March 22, 2005, no options may be exercised in whole or in part during the first year after the date granted. In general, subject to accelerated exercisability provisions related to the performance of the Company’s common stock or change of control, 50% of the options become exercisable on the fifth anniversary of the date of the option grant, with the remaining 50% becoming exercisable on the sixth anniversary date of the option grant. In general, options expire following termination of employment or the day after the tenth anniversary date of the option grant.

For options granted after March 21, 2005, no options may be exercised in whole or in part during the first year after the date granted. In general, subject to change in control, these options become exercisable 25% per year beginning on the first anniversary. In general, options expire following termination of employment or the seventh anniversary of the option grant.

The fair value of options granted before March 22, 2005, is amortized ratably over five years or a shorter period if the grant becomes subject to accelerated exercisability provisions related to the performance of the Company’s common stock. The fair value of options granted after March 21, 2005, is amortized over the vesting periods which range from one to four years.

Stock option information at December 31, 2009 and for the year then ended is as follows:

					Weighted
			Weighted		Average
			Average		Remaining
	Number of		Exercise		Contractual	Aggregate
	Shares		Price		Term	Intrinsic
	(thousands)		(per share)		(years)	Value
Options outstanding at January 1, 2009	3,213		$	23.56
Granted	1,644		10.30
Exercised	(417	)	16.80
Forfeited or expired	(379	)	23.03
Options outstanding at Dec. 31, 2009	4,061		18.93		4.8	$	56.6
Options vested or expected to vest at Dec. 31, 2009	4,009		$	18.93	4.8	$	55.9
Options exercisable at Dec. 31, 2009	1,800		$	20.55	3.7	$	24.2

Certain additional information related to stock options is as follows for the periods indicated:

	2009		2008		2007
Weighted average grant-date fair value of options granted (per share)	$	4.23	$	16.21	$	9.87
Aggregate intrinsic value of options exercised	$	3.3	$	17.3	$	44.5
Aggregate cash received from options exercised	$	7.0	$	14.5	$	62.8

Restricted Shares

Shares granted to employees prior to March 22, 2005, generally vest after three years or upon retirement, whichever is later. Shares granted after March 21, 2005, vest 25% per year beginning on the first anniversary and unvested shares are forfeited upon termination of employment. Shares granted to directors prior to 2008 were immediately vested but may not be sold until the third anniversary of the share grant or the end of the director’s then current term on the board, whichever is later. Shares granted to directors after 2007 vest after one year.

The fair value of the shares is equal to the market price of the shares on the date of the grant. The fair value of restricted shares granted before March 22, 2005, is amortized ratably over the vesting period. The fair value of restricted shares granted after March 21, 2005, is amortized over the vesting periods which range from one to four years.

Restricted share activity is as follows:

			Weighted
	Number of		Average
	Restricted		Grant-Date
	Shares		Fair Value
	(thousands)		(per share)
Nonvested at January 1, 2009	492		$	22.63
Granted	267		11.85
Vested	(148	)	25.13
Forfeited	(42	)	24.93
Nonvested at Dec. 31, 2009	569		16.73
Awards granted during 2008			$	52.02
Awards granted during 2007			$	26.07

	2009		2008		2007
Total fair value of shares vested	$	3.5	$	2.9	$	10.9

Performance Vested Restricted Share Units

Restricted share units vest on January 1 of the third year following the year in which they are granted. Holders of vested units receive 0.5 to 1.5 shares of the Company’s common stock for each unit, depending upon the attainment of consolidated performance goals established by the Compensation Committee of the Company’s Board of Directors. If minimum goals are not met, no shares will be issued. Granted but unvested restricted share units are forfeited upon termination of employment, unless certain retirement criteria are met.

The fair value of each restricted share unit is equal to the product of the fair value of the Company’s common stock on the date of grant and the estimated number of shares into which the restricted share unit will be converted. The fair value of restricted share units is amortized ratably over the vesting period. Should the estimated number of shares into which the restricted share unit will be converted change, an adjustment will be recorded to recognize the accumulated difference in amortization between the revised and previous estimates.

Performance vested restricted share unit activity is as follows:

			Weighted
	Number of		Average
	Restricted		Grant-Date
	Shares Units		Fair Value
	(thousands)		(per unit)
Nonvested at January 1, 2009	886		$	26.51
Granted	844		10.30
Vested	(403	)	18.24
Forfeited	(58	)	19.25
Nonvested at Dec. 31, 2009	1,269		18.68
Awards granted during 2008			$	52.23
Awards granted during 2007			$	24.18

	2009
Number of shares issued to holders of vested units (thousands)	605
Fair value of shares at issuance date	$	6.1

As of December 31, 2009, there was $19.6 million of total unrecognized compensation cost related to all unvested stock options, restricted shares and performance vested restricted share units. That cost is expected to be recognized over a weighted average period of approximately four years.

Pension Benefit Plans and Other Postretirement Benefits

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Pension Benefit Plans and Other Postretirement Benefits

14. Pension Benefit Plans and Other Postretirement Benefits

Pension Benefit Plans

Net expense (income) to results of operations for all of the Company’s pension plans and certain deferred compensation arrangements amounted to $42.2 million in 2009, $(3.5) million in 2008, and $24.9 million in 2007.

The Company has defined benefit pension plans covering a substantial number of employees located in the United States, the United Kingdom, The Netherlands, Canada and Australia, as well as many employees in Germany and France. Benefits generally are based on compensation for salaried employees and on length of service for hourly employees. The Company’s policy is to fund pension plans such that sufficient assets will be available to meet future benefit requirements. The Company’s defined benefit pension plans use a December 31 measurement date. The following tables relate to the Company’s principal defined benefit pension plans.

The changes in the pension benefit obligations for the year were as follows:

	2009			2008
Obligations at beginning of year	$	3,435.4		$	3,817.7
Change in benefit obligations:
Service cost	41.8			46.3
Interest cost	213.2			215.2
Actuarial (gain) loss, including effect of changing discount rates	247.6			(108.5		)
Curtailments	(2.8		)	(9.5		)
Special termination benefits	8.6			4.4
Settlements	(30.3		)
Participant contributions	7.4			8.8
Benefit payments	(252.8		)	(257.8		)
Plan amendments				3.0
Foreign currency translation	133.5			(284.2		)
Net change in benefit obligations	366.2			(382.3		)
Obligations at end of year	$	3,801.6		$	3,435.4

The changes in the fair value of the pension plans’ assets for the year were as follows:

	2009			2008
Fair value at beginning of year	$	2,706.9		$	4,084.9

Change in fair value:
Actual gain (loss) on plan assets	625.1			(973.2		)
Benefit payments	(252.8		)	(257.8		)
Employer contributions	123.1			61.2
Participant contributions	7.4			8.8
Foreign currency translation	108.2			(213.7		)
Settlements	(30.3		)
Other	(3.7		)	(3.3		)
Net change in fair value of assets	577.0			(1,378.0		)
Fair value at end of year	$	3,283.9		$	2,706.9

The funded status of the pension plans at year end was as follows:

	2009			2008
Plan assets at fair value	$	3,283.9		$	2,706.9
Projected benefit obligations	3,801.6			3,435.4
Plan assets less than projected benefit obligations	(517.7		)	(728.5		)

Items not yet recognized in pension expense:
Actuarial loss	1,640.6			1,748.1
Prior service credit	(14.8		)	(15.6		)
	1,625.8			1,732.5
Net amount recognized	$	1,108.1		$	1,004.0

The net amount recognized is included in the Consolidated Balance Sheets at December 31, 2009 and 2008 as follows:

	2009			2008
Prepaid pension	$	46.3		$	—
Current pension liability, included with Other accrued liabilities	(9.2		)	(8.0		)
Noncurrent pension liability, included with Pension benefits	(554.8		)	(720.5		)
Accumulated other comprehensive income	1,625.8			1,732.5
Net amount recognized	$	1,108.1		$	1,004.0

The following changes in plan assets and benefit obligations were recognized in accumulated other comprehensive income at December 31, 2009 as follows:

				Tax
	Pretax			Effect			After-tax
Current year actuarial loss	$	(111.3	)	$	9.9		$	(101.4	)
Amortization of actuarial loss	(44.5		)	1.4			(43.1		)
Amortization of prior service credit	0.7			(0.2		)	0.5
	(155.1		)	11.1			(144.0		)
Translation							34.7
	$	(155.1	)	$	11.1		$	(109.3	)

The accumulated benefit obligation for all defined benefit pension plans was $3,505.8 million and $3,157.0 million at December 31, 2009 and 2008, respectively.

The components of the net pension expense (income) for the year were as follows:

	2009			2008			2007
Service cost	$	41.8		$	46.3		$	54.0
Interest cost	213.2			215.2			212.0
Expected asset return	(276.6		)	(318.3		)	(317.6		)
Settlement cost	9.3						18.6
Special termination benefits	8.6			4.4
Curtailment (gain) loss	2.0			0.1			(1.5		)
Other				(1.2		)	5.1

Amortization:
Prior service credit	(0.9		)	(1.1		)	(0.8		)
Actuarial loss	43.9			30.3			38.2
Net amortization	43.0			29.2			37.4
Net expense (income)	$	41.3		$	(24.3	)	$	8.0

Total for continuing operations	$	41.3		$	(24.3	)	$	3.4
Total for discontinued operations							4.6
	$	41.3		$	(24.3	)	$	8.0

Amounts that will be amortized from accumulated other comprehensive income into net pension expense during 2010:

Amortization:
Actuarial loss	$	91.8
Prior service cost	(1.0		)
Net amortization	$	90.8

The following information is for plans with projected and accumulated benefit obligations in excess of the fair value of plan assets at year end:

	2009		2008
Projected benefit obligations	$	3,275.8	$	3,435.4
Fair value of plan assets	2,711.7		2,706.9
Accumulated benefit obligation	3,036.3		3,157.0

The weighted average assumptions used to determine benefit obligations were as follows:

	2009		2008
Discount rate	5.76	%	6.29	%
Rate of compensation increase	4.00	%	4.34	%

The weighted average assumptions used to determine net periodic pension costs were as follows:

	2009		2008		2007
Discount rate	6.29	%	5.87	%	5.49	%
Rate of compensation increase	4.34	%	4.32	%	4.34	%
Expected long-term rate of return on assets	7.61	%	8.09	%	8.08	%

Future benefits are assumed to increase in a manner consistent with past experience of the plans, which, to the extent benefits are based on compensation, includes assumed salary increases as presented above. Amortization included in net pension expense (credits) is based on the average remaining service of employees.

For 2009, the Company’s weighted average expected long-term rate of return on assets was 7.61%. In developing this assumption, the Company evaluated input from its third party pension plan asset managers, including their review of asset class return expectations and long-term inflation assumptions. The Company also considered its historical 10-year average return (through December 31, 2008), which was in line with the expected long-term rate of return assumption for 2009.

It is the Company’s policy to invest pension plan assets in a diversified portfolio consisting of an array of asset classes within established target asset allocation ranges. The investment risk of the assets is limited by appropriate diversification both within and between asset classes. The assets for both the U.S. and non-U.S. plans are primarily invested in a broad mix of domestic and international equities, domestic and international bonds, and real estate, subject to the target asset allocation ranges. The assets are managed with a view to ensuring that sufficient liquidity will be available to meet expected cash flow requirements.

The investment valuation policy of the Company is to value investments at fair value. All investments are valued at their respective net asset values. Equity securities for which market quotations are readily available are valued at the last reported sales price on their principal exchange on valuation date or official close for certain markets. Fixed income investments are valued on a basis of valuations furnished by a trustee-approved independent pricing service, which determines valuations for normal institutional-size trading units of such securities which are generally recognized at fair value as determined in good faith by the Trustee. Investments in registered investment companies or collective pooled funds are valued at their respective net asset values. Short-term investments are stated at amortized cost, which approximates fair value. The fair value of real estate is determined by periodic appraisals.

The following table sets forth by level, within the fair value hierarchy, the Company’s pension plan assets at fair value as of December 31, 2009:

									Target
	Level 1		Level 2		Level 3		Total		Allocation

Cash and cash equivalents	$	35.8	$	10.0	$	—	$	45.8

Equity securities	405.8		1,553.1				1,958.9		49-59	%

Debt securities	515.2		684.4		8.8		1,208.4		28-38	%

Real estate					10.9		10.9		1-11	%

Other	54.4		5.5				59.9		2-12	%

Total assets at fair value	$	1,011.2	$	2,253.0	$	19.7	$	3,283.9

The following is a reconciliation of the Company’s pension plan assets recorded at fair value using significant unobservable inputs (Level 3):

Balance at December 31, 2008	$	29.1

Net decrease	(9.4		)

Balance at December 31, 2009	$	19.7

The net decrease in the fair value of the Company’s Level 3 pension plan assets is primarily due to sales of unlisted real estate funds. The change in the fair value of Level 3 pension plan assets due to actual return on those assets was immaterial in 2009.

Based on exchange rates at the end of 2009, the Company expects to contribute approximately $10 million to $15 million to its non-U.S. defined benefit pension plans in 2010.

The following estimated future benefit payments, which reflect expected future service, as appropriate, are expected to be paid in the years indicated:

Year(s)	Amount
2010	$	251.4
2011	247.5
2012	250.2
2013	252.4
2014	256.0
2015 - 2019	1,294.7

The Company also sponsors several defined contribution plans for all salaried and hourly U.S. employees. Participation is voluntary and participants’ contributions are based on their compensation. The Company matches contributions of participants, up to various limits, in substantially all plans. Company contributions to these plans amounted to $7.2 million in 2009, $7.1 million in 2008, and $6.7 million in 2007.

Postretirement Benefits Other Than Pensions

The Company provides certain retiree health care and life insurance benefits covering substantially all U.S. salaried and certain hourly employees, and substantially all employees in Canada and in The Netherlands. Employees are generally eligible for benefits upon retirement and completion of a specified number of years of creditable service. The Company uses a December 31 measurement date to measure its Postretirement Benefit Obligations.

The changes in the postretirement benefit obligations for the year were as follows:

	2009			2008
Obligations at beginning of year	$	260.3		$	309.5

Change in benefit obligations:
Service cost	1.8			2.2
Interest cost	16.4			17.2
Actuarial (gain) loss, including the effect of changing discount rates	21.7			(30.0		)
Curtailments				(2.9		)
Special termination benefits				0.9
Benefit payments	(22.2		)	(19.9		)
Foreign currency translation	11.0			(16.7		)
Net change in benefit obligations	28.7			(49.2		)
Obligations at end of year	$	289.0		$	260.3

The funded status of the postretirement benefit plans at year end was as follows:

	2009			2008
Postretirement benefit obligations	$	289.0		$	260.3

Items not yet recognized in net postretirement benefit cost:
Prior service credit	17.5			20.7
Actuarial loss	(56.9		)	(39.7		)
	(39.4		)	(19.0		)
Net amount recognized	$	249.6		$	241.3

The net amount recognized is included in the Consolidated Balance Sheets at December 31, 2009 and 2008 as follows:

	2009			2008
Current nonpension postretirement benefit, included with Other accrued liabilities	$	(22.3	)	$	(22.3	)
Nonpension postretirement benefits	(266.7		)	(238.0		)
Accumulated other comprehensive income	39.4			19.0
Net amount recognized	$	(249.6	)	$	(241.3	)

The following changes in benefit obligations were recognized in accumulated other comprehensive income at December 31, 2009 as follows:

				Tax
	Pretax			Effect			After-tax
Current year actuarial gain	$	22.4		$	(2.2	)	$	20.2
Amortization of actuarial loss	(3.9		)				(3.9		)
Amortization of prior service credit	3.1						3.1
	21.6			(2.2		)	19.4
Translation							(1.0		)
	$	21.6		$	(2.2	)	$	18.4

The components of the net postretirement benefit cost for the year were as follows:

	2009			2008			2007
Service cost	$	1.8		$	2.2		$	3.0
Interest cost	16.4			17.2			17.4
Curtailment gain							(14.9		)
Special termination benefit				0.9
Other
Amortization:
Prior service credit	(3.1		)	(3.1		)	(3.8		)
Actuarial loss	3.9			6.2			5.8
Net amortization	0.8			3.1			2.0
Net postretirement benefit cost	$	19.0		$	23.4		$	7.5
Total for continuing operations	19.0			23.4			20.7
Total for discontinued operations							(13.2		)
	$	19.0		$	23.4		$	7.5

Amounts that will be amortized from accumulated other comprehensive income into net postretirement benefit cost during 2010:

Amortization:
Actuarial loss	$	5.3
Prior service credit	(3.1		)
Net amortization	$	2.2

The weighted average discount rate used to determine the accumulated postretirement benefit obligation was 5.66% and 6.40% at December 31, 2009 and 2008, respectively.

The weighted average discount rate used to determine net postretirement benefit cost was 6.40%, 5.86%, and 5.56% at December 31, 2009, 2008, and 2007, respectively.

The weighted average assumed health care cost trend rates at December 31 were as follows:

	2009		2008
Health care cost trend rate assumed for next year	8.29	%	7.38	%
Rate to which the cost trend rate is assumed to decline (ultimate trend rate)	5.00	%	5.67	%
Year that the rate reaches the ultimate trend rate	2015		2010

Assumed health care cost trend rates affect the amounts reported for the postretirement benefit plans. A one-percentage-point change in assumed health care cost trend rates would have the following effects:

	1-Percentage-		1-Percentage-
	Point Increase		Point Decrease
Effect on total of service and interest cost	$	1.4	$	(1.1	)
Effect on accumulated postretirement benefit obligations	18.6		(15.7		)

Amortization included in net postretirement benefit cost is based on the average remaining service of employees.

The following estimated future benefit payments, which reflect expected future service, as appropriate, are expected to be paid in the years indicated:

Year(s)	Amount
2010	$	22.3
2011	22.3
2012	22.2
2013	22.1
2014	22.0
2015 - 2019	107.4

Benefits provided by the Company for certain hourly retirees are determined by collective bargaining. Most other domestic hourly retirees receive health and life insurance benefits from a multi-employer trust established by collective bargaining. Payments to the trust as required by the bargaining agreements are based upon specified amounts per hour worked and were $7.2 million in 2009, $8.9 million in 2008, and $7.4 million in 2007. Postretirement health and life benefits for retirees of foreign subsidiaries are generally provided through the national health care programs of the countries in which the subsidiaries are located.

- Definition

Description containing the entire pension and other postretirement benefits disclosure as a single block of text.

+ References

Reference 1: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 158

-Paragraph 7, 21, 22

Reference 2: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5, 6, 7, 8

Reference 3: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 8

-Subparagraph m

Reference 4: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 106

-Paragraph 518

Reference 5: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 87

-Paragraph 264

Reference 6: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph b

Reference 7: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph a

Reference 8: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph h

Reference 9: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Statement of Financial Accounting Standard (FAS)

-Number 132R

-Paragraph 5

-Subparagraph q

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name FASB Staff Position (FSP)

-Number FAS106-2

-Paragraph 20, 21, 22

Reference 11: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Emerging Issues Task Force (EITF)

-Number 03-2

-Paragraph 8

Reference 12: http://www.xbrl.org/2003/role/presentationRef

-Publisher AICPA

-Name Accounting Principles Board Opinion (APB)

-Number 30

-Paragraph 26

Reference 13: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

-Name Implementation Guide (Q and A)

-Number FAS88

-Paragraph 63

+ Details

Restructuring Accruals

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Restructuring Accruals

16. Restructuring Accruals Beginning in 2007, the Company commenced a strategic review of its global profitability and manufacturing footprint. The combined 2007, 2008 and 2009 charges, amounting to $401.3 million ($333.1 million after tax amount attributable to the Company), reflect the decisions reached through December 31, 2009 in the Company’s strategic review of its global manufacturing footprint. The related curtailment of plant capacity and realignment of selected operations will result in an overall reduction in the Company’s workforce of approximately 3,250 jobs. Amounts recorded by the Company do not include any gains that may be realized upon the ultimate sale or disposition of closed facilities.

The Company’s decisions to curtail selected production capacity have resulted in write downs of certain long-lived assets to the extent their carrying amounts exceeded fair value less cost to sell. The Company classified the significant assumptions used to determine the fair value of the impaired assets, which was not material, as “Level 3” in the fair value hierarchy as set forth in the general accounting principles for fair value measurements.

The Company also recorded liabilities for certain employee separation costs to be paid under contractual arrangements and other exit costs.

2007

During the third and fourth quarters of 2007, the Company recorded charges totaling $55.3 million ($40.2 million after tax amount attributable to the Company) for restructuring and asset impairment in Europe and North America. The curtailment of plant capacity resulted in elimination of approximately 560 jobs and a corresponding reduction in the Company’s workforce.

2008

During 2008, the Company recorded charges totaling $132.4 million ($110.1 million after tax amount attributable to the Company) for restructuring and asset impairment across all segments as well as in Retained Corporate Costs and Other. The curtailment of plant capacity and realignment of selected operations resulted in elimination of approximately 1,240 jobs and a corresponding reduction in the Company’s workforce.

2009

During 2009, the Company recorded charges totaling $213.6 million ($182.8 million after tax amount attributable to the Company) for restructuring and asset impairment across all segments. The curtailment of plant capacity will result in elimination of approximately 1,450 jobs and a corresponding reduction in the Company’s workforce.

As of December 31, 2009, the Company has concluded its global manufacturing footprint review, with the final actions to be implemented during the first half of 2010. The Company expects that the majority of the remaining estimated cash expenditures related to the above charges will be paid out by the end of 2010.

Selected information related to the restructuring accrual is as follows:

	Employee Costs			Asset Impairment			Other			Total

2007 Charges	$	26.1		$	22.3		$	6.9		$	55.3
Write-down of assets to net realizable value	—			(22.3		)	(2.4		)	(24.7		)
Total restructuring accrual at December 31, 2007	26.1			—			4.5			30.6
2008 charges	70.1			32.5			29.8			132.4
Write-down of assets to net realizable value				(32.5		)	(4.7		)	(37.2		)
Net cash paid, principally severance and related benefits	(35.6		)				(7.2		)	(42.8		)
Other, principally foreign exchange translation	(13.0		)				(6.1		)	(19.1		)
Total restructuring accrual at December 31, 2008	47.6			—			16.3			63.9
2009 charges	116.3			78.7			18.6			213.6
Write-down of assets to net realizable value				(78.7		)				(78.7		)
Net cash paid, principally severance and related benefits	(60.8		)				(7.5		)	(68.3		)
Other, principally foreign exchange translation	(8.8		)				(1.6		)	(10.4		)
Remaining restructuring accrual as of December 31, 2009	$	94.3		$	—		$	25.8		$	120.1

Contingencies

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Contingencies

18. Contingencies The Company is one of a number of defendants in a substantial number of lawsuits filed in numerous state and federal courts by persons alleging bodily injury (including death) as a result of exposure to dust containing asbestos fibers. From 1948 to 1958, one of the Company’s former business units commercially produced and sold approximately $40 million of a high-temperature, calcium-silicate based pipe and block insulation material containing asbestos. The Company exited the pipe and block insulation business in April 1958. The traditional asbestos personal injury lawsuits and claims relating to such production and sale of asbestos material typically allege various theories of liability, including negligence, gross negligence and strict liability and seek compensatory and in some cases, punitive damages in various amounts (herein referred to as “asbestos claims”).

The following table shows the approximate number of plaintiffs and claimants who had asbestos claims pending against the Company at the beginning of each listed year, the number of claims disposed of during that year, the year’s filings and the claims pending at the end of each listed year (eliminating duplicate filings):

	2009	2008	2007
Pending at beginning of year	11,000	14,000	18,000
Disposed	10,000	8,000	13,000
Filed	6,000	5,000	9,000

Pending at end of year	7,000	11,000	14,000

Based on an analysis of the lawsuits pending as of December 31, 2009, approximately 79% of plaintiffs either do not specify the monetary damages sought, or in the case of court filings, claim an amount sufficient to invoke the jurisdictional minimum of the trial court. Approximately 20% of plaintiffs specifically plead damages of $15 million or less, and 1% of plaintiffs specifically plead damages greater than $15 million but less than $100 million. Fewer than 1% of plaintiffs specifically plead damages $100 million or greater but less than $122 million.

As indicated by the foregoing summary, current pleading practice permits considerable variation in the assertion of monetary damages. The Company’s experience resolving hundreds of thousands of asbestos claims and lawsuits over an extended period, demonstrates that the monetary relief which may be alleged in a complaint bears little relevance to a claim’s merits or disposition value. Rather, the amount potentially recoverable is determined by such factors as the plaintiff’s severity of disease, the product identification evidence against specific defendants, the defenses available to those defendants, the specific jurisdiction in which the claim is made, and the plaintiff’s history of smoking or exposure to other possible disease-causative factors.

In addition to the pending claims set forth above, the Company has claims-handling agreements in place with many plaintiffs’ counsel throughout the country. These agreements require evaluation and negotiation regarding whether particular claimants qualify under the criteria established by such agreements. The criteria for such claims include verification of a compensable illness and a reasonable probability of exposure to a product manufactured by the Company’s former business unit during its manufacturing period ending in 1958. Some plaintiffs’ counsel have historically withheld claims under these agreements for later presentation while focusing their attention on active litigation in the tort system. The Company believes that as of December 31, 2009 there are approximately 800 claims against other defendants which are likely to be asserted some time in the future against the Company. These claims are not included in the pending “lawsuits and claims” totals set forth above.

The Company is also a defendant in other asbestos-related lawsuits or claims involving maritime workers, medical monitoring claimants, co-defendants and property damage claimants. Based upon its past experience, the Company believes that these categories of lawsuits and claims will not involve any material liability and they are not included in the above description of pending matters or in the following description of disposed matters.

Since receiving its first asbestos claim, the Company as of December 31, 2009, has disposed of the asbestos claims of approximately 379,000 plaintiffs and claimants at an average indemnity payment per claim of approximately $7,500. Certain of these dispositions have included deferred amounts payable over a number of years. Deferred amounts payable totaled approximately $36.3 million at December 31, 2009 ($34.0 million at December 31, 2008) and are included in the foregoing average indemnity payment per claim. The Company’s indemnity payments for these claims have varied on a per claim basis, and are expected to continue to vary considerably over time. As discussed above, a part of the Company’s objective is to achieve, where possible, resolution of asbestos claims pursuant to claims-handling agreements. Failure of claimants to meet certain medical and product exposure criteria in the Company’s administrative claims handling agreements has generally reduced the number of marginal or suspect claims that would otherwise have been received. This may have the effect of increasing the Company’s per-claim average indemnity payment over time.

The Company believes that its ultimate asbestos-related liability (i.e., its indemnity payments or other claim disposition costs plus related legal fees) cannot reasonably be estimated. Beginning with the initial liability of $975 million established in 1993, the Company has accrued a total of approximately $3.65 billion through 2009, before insurance recoveries, for its asbestos-related liability. The Company’s ability to reasonably estimate its liability has been significantly affected by the volatility of asbestos-related litigation in the United States, the inherent uncertainty of future disease incidence and claiming patterns, the expanding list of non-traditional defendants that have been sued in this litigation and found liable for substantial damage awards, the use of mass litigation screenings to generate new lawsuits, the large number of claims asserted or filed by parties who claim prior exposure to asbestos materials but have no present physical impairment as a result of such exposure, and the significant number of co-defendants that have filed for bankruptcy.

The Company has continued to monitor trends that may affect its ultimate liability and has continued to analyze the developments and variables affecting or likely to affect the resolution of pending and future asbestos claims against the Company. The material components of the Company’s accrued liability are based on amounts determined by the Company in connection with its annual comprehensive review and consist of the following estimates, to the extent it is probable that such liabilities have been incurred and can be reasonably estimated: (i) the liability for asbestos claims already asserted against the Company; (ii) the liability for preexisting but unasserted asbestos claims for prior periods arising under its administrative claims-handling agreements with various plaintiffs’ counsel; (iii) the liability for asbestos claims not yet asserted against the Company, but which the Company believes will be asserted in the next several years; and (iv) the legal defense costs likely to be incurred in connection with the foregoing types of claims.

The significant assumptions underlying the material components of the Company’s accrual are:

a) the extent to which settlements are limited to claimants who were exposed to the Company’s asbestos-containing insulation prior to its exit from that business in 1958;

b) the extent to which claims are resolved under the Company’s administrative claims agreements or on terms comparable to those set forth in those agreements;

c) the extent of decrease or increase in the incidence of serious disease cases and claiming patterns for such cases;

d) the extent to which the Company is able to defend itself successfully at trial;

e) the extent to which courts and legislatures eliminate, reduce or permit the diversion of financial resources for unimpaired claimants and so-called forum shopping;

f) the extent to which additional defendants with substantial resources and assets are required to participate significantly in the resolution of future asbestos lawsuits and claims;

g) the number and timing of additional co-defendant bankruptcies; and

h) the extent to which co-defendant bankruptcy trusts direct resources to resolve claims that are also presented to the Company and the timing of the payments made by the bankruptcy trusts.

As noted above, the Company conducts a comprehensive review of its asbestos-related liabilities and costs annually in connection with finalizing and reporting its annual results of operations, unless significant changes in trends or new developments warrant an earlier review. If the results of an annual comprehensive review indicate that the existing amount of the accrued liability is insufficient to cover its estimated future asbestos-related costs, then the Company will record an appropriate charge to increase the accrued liability. The Company believes that a reasonable estimation of the probable amount of the liability for claims not yet asserted against the Company is not possible beyond a period of several years. Therefore, while the results of future annual comprehensive reviews cannot be determined, the Company expects the addition of one year to the estimation period will result in an annual charge.

Other litigation is pending against the Company, in many cases involving ordinary and routine claims incidental to the business of the Company and in others presenting allegations that are non-routine and involve compensatory, punitive or treble damage claims as well as other types of relief. The Company records a liability for such matters when it is both probable that the liability has been incurred and the amount of the liability can be reasonably estimated. Recorded amounts are reviewed and adjusted to reflect changes in the factors upon which the estimates are based including additional information, negotiations, settlements, and other events.

The ultimate legal and financial liability of the Company with respect to the lawsuits and proceedings referred to above, in addition to other pending litigation, cannot reasonably be estimated. The Company’s reported results of operations for 2009 were materially affected by the $180.0 million (pretax and after tax) fourth quarter charge for asbestos-related costs and asbestos-related payments continue to be substantial. Any future additional charge would likewise materially affect the Company’s results of operations for the period in which it is recorded. Also, the continued use of significant amounts of cash for asbestos-related costs has affected and will continue to affect the Company’s cost of borrowing and its ability to pursue global or domestic acquisitions. However, the Company believes that its operating cash flows and other sources of liquidity will be sufficient to pay its obligations for asbestos-related costs and to fund its working capital and capital expenditure requirements on a short-term and long-term basis.

Segment Information

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Segment Information

19. Segment Information The Company has four reportable segments based on its four geographic locations: (1) Europe; (2) North America; (3) South America; (4) Asia Pacific. These four segments are aligned with the Company’s internal approach to managing, reporting, and evaluating performance of its global glass operations. Certain assets and activities not directly related to one of the regions or to glass manufacturing are reported with Retained Corporate Costs and Other. These include licensing, equipment manufacturing, global engineering, and non-glass equity investments. Retained Corporate Costs and Other also includes certain headquarters administrative and facilities costs and certain incentive compensation and other benefit plan costs that are global in nature and are not allocable to the reportable segments.

The Company’s measure of profit for its reportable segments is Segment Operating Profit, which consists of consolidated earnings from continuing operations before interest income, interest expense, and provision for income taxes and excludes amounts related to certain items that management considers not representative of ongoing operations as well as certain retained corporate costs. The Company’s management uses Segment Operating Profit, in combination with selected cash flow information, to evaluate performance and to allocate resources.

Segment Operating Profit for reportable segments includes an allocation of some corporate expenses based on both a percentage of sales and direct billings based on the costs of specific services provided. Beginning in 2008, the Company revised its method of allocating corporate expenses. The Company decreased slightly the percentage allocation based on sales and significantly expanded the number of functions included in the allocation based on cost of services. It is not practicable to quantify the net effect of these changes on periods prior to 2008. However, the effect for 2008 was to reduce the amount of retained corporate costs by approximately $38.0 million. The information below is presented on a continuing operations basis, and therefore, the 2007 amounts exclude amounts related to the discontinued operations of the Company’s former Plastics Packaging segment. See Note 21 for more information.

Financial information regarding the Company’s reportable segments is as follows:

Net Sales:	2009		2008		2007
Europe	$	2,917.6	$	3,497.8	$	3,298.7
North America	2,074.3		2,209.7		2,271.3
South America	1,104.1		1,135.9		970.7
Asia Pacific	925.0		964.1		934.3
Reportable segment totals	7,021.0		7,807.5		7,475.0
Other	45.5		77.2		91.7
Net sales	$	7,066.5	$	7,884.7	$	7,566.7

Segment Operating Profit:	2009			2008			2007
Europe	$	332.6		$	477.8		$	433.0
North America	281.5			185.2			265.1
South America	250.6			331.0			254.9
Asia Pacific	131.3			162.8			154.0
Reportable segment totals	996.0			1,156.8			1,107.0

Items excluded from Segment Operating Profit:
Retained corporate costs and other	(66.7		)	(0.7		)	(78.8		)
Restructuring and asset impairments	(213.6		)	(133.3		)	(100.3		)
Charge for Venezuela currency remeasurement	(17.3		)
Charge for asbestos related costs	(180.0		)	(250.0		)	(115.0		)
Interest income	28.6			38.6			42.3
Interest expense	(221.7		)	(253.0		)	(348.6		)
Earnings from continuing operations before income taxes	$	325.3		$	558.4		$	506.6

										Reportable		Retained
			North		South			Asia		Segment		Corp Costs		Consolidated
	Europe		America		America			Pacific		Totals		and Other		Totals
Total assets:
2009	$	3,852.3	$	1,899.8	$	855.9		$	1,683.0	$	8,291.0	$	436.4	$	8,727.4
2008	3,758.4		1,802.9		976.2			1,239.6		7,777.1		199.4		7,976.5
2007	4,124.1		1,946.9		965.7			1,558.1		8,594.8		729.8		9,324.6
Equity earnings:
2009	$	12.5	$	14.2	$	—		$	—	$	26.7	$	25.9	$	52.6
2008	14.1		12.6							26.7		24.1		50.8
2007	8.0		10.4		(2.7		)			15.7		18.4		34.1
Capital expenditures (1):
2009
Continuing	$	169.7	$	103.0	$	66.9		$	81.5	$	421.1	$	6.5	$	427.6
2008
Continuing	151.9		90.5		57.3			57.6		357.3		4.4		361.7
2007
Continuing	129.2		65.9		51.1			42.0		288.2		4.3		292.5
Discontinued												23.3		23.3
Depreciation and amortization expense:
2009
Continuing	$	178.6	$	98.9	$	50.1		$	67.1	$	394.7	$	11.6	$	406.3
2008
Continuing	222.0		98.7		56.5			80.4		457.6		10.2		467.8
2007
Continuing	210.3		107.3		54.3			81.7		453.6		7.3		460.9
Discontinued												23.3		23.3

(1) Excludes property, plant and equipment acquired through acquisitions.

The Company’s net property, plant, and equipment by geographic segment are as follows:

	United
	States		Foreign		Total
2009	$	639.2	$	2,103.1	$	2,742.3
2008	679.5		1,966.1		2,645.6
2007	678.9		2,271.1		2,950.0

The Company’s net sales by geographic segment are as follows:

	United
	States		Foreign		Total
2009	$	1,877.5	$	5,189.0	$	7,066.5
2008	1,894.8		5,989.9		7,884.7
2007	1,920.6		5,646.1		7,566.7

Operations in individual countries outside the United States that accounted for more than 10% of consolidated net sales from continuing operations were in Italy (2009 - 10.4%, 2008 - 10.7%, 2007 - 10.1%) and France (2009 - 13.0%, 2008 - 14.7%, 2007 - 19.3%).

Goodwill

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Goodwill

20. Goodwill The changes in the carrying amount of goodwill for the years ended December 31, 2007, 2008 and 2009 are as follows:

	North						Asia			South
	America			Europe			Pacific			America		Other			Total
Balance as of January 1, 2007	$	721.6		$	1,017.0		$	502.1		$	—	$	14.5		$	2,255.2
Translation effects	25.1			115.3			54.6								195.0
Other changes	(1.1		)	(13.0		)						(8.0		)	(22.1		)
Balance as of December 31, 2007	745.6			1,119.3			556.7			—		6.5			2,428.1
Translation effects	(28.8		)	(58.2		)	(123.1		)			0.3			(209.8		)
Other changes				(10.1		)						(0.7		)	(10.8		)
Balance as of December 31, 2008	716.8			1,051.0			433.6			—		6.1			2,207.5
Translation effects	18.9			29.6			124.8								173.3
Other changes												0.2			0.2
Balance as of December 31, 2009	$	735.7		$	1,080.6		$	558.4		$	—	$	6.3		$	2,381.0

Goodwill for the Asia Pacific segment is net of accumulated impairment losses of $494.0 million.

During the fourth quarters of 2009, 2008 and 2007, the Company completed its annual impairment testing and determined that no impairment existed.

Discontinued Operations

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Discontinued Operations

21. Discontinued Operations On July 31, 2007, the Company completed the sale of its plastics packaging business to Rexam PLC for approximately $1.825 billion in cash. In accordance with general accounting principles, the Company has presented the results of operations for the plastics packaging business in the Consolidated Results of Operations for the year ended December 31, 2007 as discontinued operations. Interest expense was allocated to the discontinued operations based on debt that was required by an amendment to the Secured Credit Agreement to be repaid from the net proceeds. Amounts for 2007 have been reclassified to conform to this presentation.

The following summarizes the revenues and expenses of the discontinued operations as reported in the consolidated results of operations for the period indicated:

	Year ended
	December 31,
	2007
Net sales	$	455.0
Manufacturing, shipping and delivery	(343.5		)
Gross profit	111.5

Selling and administrative	(20.7		)
Research, development and engineering	(8.3		)
Interest expense	(80.6		)
Other income	(0.1		)
Other expense	(1.2		)
Earnings before items below	0.6
Credit for income taxes	2.4
Earnings from discontinued operations	3.0
Gain on sale of discontinued operations	1,038.5
Net earnings from discontinued operations	1,041.5
Net earnings from discontinued operations attributable to noncontrolling interests	(0.2		)
Net earnings from discontinued operations attributable to the Company	$	1,041.3

The 2007 gain on the sale of discontinued operations of $1,038.5 million includes charges totaling $62.1 million for debt retirement costs, consisting principally of redemption premiums and write off of unamortized fees, and a gain of $8.7 million for curtailment and settlement of pension and other postretirement benefits. The gain also includes a net provision for income taxes of $38.2 million, consisting of taxes on the gain of $445.0 million that are substantially offset by a credit of $406.8 million for the reversal of valuation allowances against existing tax loss carryforwards. The sale agreement provides for an adjustment of the selling price based on working capital levels and certain other factors.

The gain on sale of discontinued operations of $6.8 million reported in 2008 relates to an adjustment of the 2007 gain on the sale of the plastics packaging business mainly related to finalizing certain tax allocations and an adjustment to the selling price in accordance with procedures set forth in the final contract.

Financial Information for Subsidiary Guarantors and Non-Guarantors

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Financial Information for Subsidiary Guarantors and Non-Guarantors

23. Financial Information for Subsidiary Guarantors and Non-Guarantors The following presents condensed consolidated financial information for the Company, segregating: (1) Owens-Illinois, Inc., the issuer of two series of senior notes and debentures (the “Parent”); (2) the two subsidiaries which have guaranteed the senior notes and debentures on a subordinated basis (the “Guarantor Subsidiaries”); and (3) all other subsidiaries (the “Non-Guarantor Subsidiaries”). The Guarantor Subsidiaries are 100% owned direct and indirect subsidiaries of the Company and their guarantees are full, unconditional and joint and several. They have no operations and function only as intermediate holding companies.

Wholly-owned subsidiaries are presented on the equity basis of accounting. Certain reclassifications have been made to conform all of the financial information to the financial presentation on a consolidated basis. The principal eliminations relate to investments in subsidiaries and inter-company balances and transactions.

	December 31, 2009
					Non-
			Guarantor		Guarantor
Balance Sheet	Parent		Subsidiaries		Subsidiaries		Eliminations			Consolidated

Current assets:
Accounts receivable	$	—	$	—	$	1,004.2	$	—		$	1,004.2
Inventories					900.3					900.3
Other current assets					892.2					892.2
Total current assets	—		—		2,796.7		—			2,796.7
Investments in and advances to subsidiaries	2,301.4		2,023.3				(4,324.7		)	—
Goodwill					2,381.0					2,381.0
Other non-current assets					807.4					807.4
Total other assets	2,301.4		2,023.3		3,188.4		(4,324.7		)	3,188.4
Property, plant and equipment, net					2,742.3					2,742.3
Total assets	$	2,301.4	$	2,023.3	$	8,727.4	$	(4,324.7	)	$	8,727.4
Current liabilities :
Accounts payable and accrued liabilities	$	—	$	—	$	1,507.3	$	—		$	1,507.3
Current portion of asbestos liability	175.0									175.0
Short-term loans and long-term debt due within one year	28.1				352.0		(28.1		)	352.0
Total current liabilities	203.1		—		1,859.3		(28.1		)	2,034.3
Long-term debt	250.0				3,257.5		(250.0		)	3,257.5
Asbestos-related liabilities	310.1									310.1
Other non-current liabilities					1,389.1					1,389.1
Total share owners’ equity of the Company	1,538.2		2,023.3		2,023.3		(4,046.6		)	1,538.2
Noncontrolling interests					198.2					198.2
Total liabilities and share owners’ equity	$	2,301.4	$	2,023.3	$	8,727.4	$	(4,324.7	)	$	8,727.4

	December 31, 2008
						Non-
				Guarantor		Guarantor
Balance Sheet	Parent			Subsidiaries		Subsidiaries		Eliminations			Consolidated

Current assets:
Accounts receivable	$	—		$	—	$	988.8	$	—		$	988.8
Inventories						999.5					999.5
Other current assets						456.4					456.4
Total current assets	—			—		2,444.7		—			2,444.7
Investments in and advances to subsidiaries	2,035.9			1,535.9				(3,571.8		)	—
Goodwill						2,207.5					2,207.5
Other non-current assets						678.7					678.7
Total other assets	2,035.9			1,535.9		2,886.2		(3,571.8		)	2,886.2
Property, plant and equipment, net						2,645.6					2,645.6
Total assets	$	2,035.9		$	1,535.9	$	7,976.5	$	(3,571.8	)	$	7,976.5
Current liabilities :
Accounts payable and accrued liabilities	$	—		$	—	$	1,434.5	$	—		$	1,434.5
Current portion of asbestos liability	175.0										175.0
Short-term loans and long-term debt due within one year						393.8					393.8
Total current liabilities	175.0			—		1,828.3		—			2,003.3
Long-term debt	508.9					2,931.4		(500.0		)	2,940.3
Asbestos-related liabilities	320.3										320.3
Other non-current liabilities	(8.9		)			1,428.1					1,419.2
Total share owners’ equity of the Company	1,040.6			1,535.9		1,535.9		(3,071.8		)	1,040.6
Noncontrolling interests						252.8					252.8
Total liabilities and share owners’ equity	$	2,035.9		$	1,535.9	$	7,976.5	$	(3,571.8	)	$	7,976.5

	Year ended December 31, 2009
							Non-
				Guarantor			Guarantor
Results of Operations	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Net sales	$	—		$	—		$	7,066.5		$	—		$	7,066.5
Manufacturing, shipping, and delivery							(5,582.6		)				(5,582.6		)
Gross profit	—			—			1,483.9			—			1,483.9

Research, engineering, selling, administrative, and other	(180.0		)				(862.2		)				(1,042.2		)
External interest expense	(39.0		)				(182.7		)				(221.7		)
Intercompany interest expense				(39.0		)	(39.0		)	78.0			—
External interest income							28.6						28.6
Intercompany interest income	39.0			39.0						(78.0		)	—
Equity earnings from subsidiaries	314.6			314.6						(629.2		)	—
Other equity earnings							52.6						52.6
Other revenue							24.1						24.1

Earnings before income taxes	134.6			314.6			505.3			(629.2		)	325.3
Provision for income taxes	27.2						(154.7		)				(127.5		)
Net earnings	161.8			314.6			350.6			(629.2		)	197.8
Net earnings attributable to noncontrolling interests							(36.0		)				(36.0		)
Net earnings attributable to the Company	$	161.8		$	314.6		$	314.6		$	(629.2	)	$	161.8

	Year ended December 31, 2008
							Non-
				Guarantor			Guarantor
Results of Operations	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Net sales	$	—		$	—		$	7,884.7		$	—		$	7,884.7
Manufacturing, shipping, and delivery							(6,208.1		)				(6,208.1		)
Gross profit	—			—			1,676.6			—			1,676.6

Research, engineering, selling, administrative, and other	(250.0		)				(732.7		)				(982.7		)
External interest expense	(45.8		)				(207.2		)				(253.0		)
Intercompany interest expense				(45.8		)	(45.8		)	91.6			—
External interest income							38.6						38.6
Intercompany interest income	45.8			45.8						(91.6		)	—
Equity earnings from subsidiaries	500.3			500.3						(1,000.6		)	—
Other equity earnings							50.8						50.8
Other revenue							28.1						28.1

Earnings from continuing operations before income taxes	250.3			500.3			808.4			(1,000.6		)	558.4
Provision for income taxes	1.2						(237.9		)				(236.7		)
Earnings from continuing operations	251.5			500.3			570.5			(1,000.6		)	321.7
Net earnings of discontinued operations	6.8			6.8			6.8			(13.6		)	6.8
Net earnings	258.3			507.1			577.3			(1,014.2		)	328.5
Net earnings attributable to noncontrolling interests							(70.2		)				(70.2		)
Net earnings attributable to the Company	$	258.3		$	507.1		$	507.1		$	(1,014.2	)	$	258.3

	Year ended December 31, 2007
							Non-
				Guarantor			Guarantor
Results of Operations	Parent			Subsidiaries			Subsidiaries			Eliminations			Consolidated

Net sales	$	—		$	—		$	7,566.7		$	—		$	7,566.7
Manufacturing, shipping, and delivery							(5,971.4		)				(5,971.4		)
Gross profit	—			—			1,595.3			—			1,595.3

Research, engineering, selling, administrative, and other	(115.0		)				(737.6		)				(852.6		)
External interest expense	(66.9		)				(281.7		)				(348.6		)
Intercompany interest expense				(66.9		)	(66.9		)	133.8			—
External interest income							42.3						42.3
Intercompany interest income	66.9			66.9						(133.8		)	—
Equity earnings from subsidiaries	414.1			414.1						(828.2		)	—
Other equity earnings							34.1						34.1
Other revenue							36.1						36.1

Earnings from continuing operations before income taxes	299.1			414.1			621.6			(828.2		)	506.6
Provision for income taxes							(147.8		)				(147.8		)

Earnings from continuing operations	299.1			414.1			473.8			(828.2		)	358.8
Net earnings of discontinued operations	1,041.5			1,041.5			1,041.5			(2,083.0		)	1,041.5
Net earnings	1,340.6			1,455.6			1,515.3			(2,911.2		)	1,400.3
Net earnings attributable to noncontrolling interests							(59.7		)				(59.7		)
Net earnings attributable to the Company	$	1,340.6		$	1,455.6		$	1,455.6		$	(2,911.2	)	$	1,340.6

	Year ended December 31, 2009
						Non-
				Guarantor		Guarantor
Cash Flows	Parent			Subsidiaries		Subsidiaries			Eliminations		Consolidated

Cash provided by (utilized in) operating activities	$	(190.3	)	$	—	$	990.3		$	—	$	800.0

Cash utilized in investing activities						(418.0		)			(418.0		)

Cash provided by (utilized in) financing activities	190.3					(76.1		)			114.2

Effect of exchange rate change on cash						(64.0		)			(64.0		)

Net change in cash	—			—		432.2			—		432.2

Cash at beginning of period						379.5					379.5

Cash at end of period	$	—		$	—	$	811.7		$	—	$	811.7

	Year ended December 31, 2008
						Non-
				Guarantor		Guarantor
Cash Flows	Parent			Subsidiaries		Subsidiaries			Eliminations		Consolidated

Cash provided by (utilized in) operating activities	$	(209.0	)	$	—	$	966.2		$	—	$	757.2

Cash utilized in investing activities						(377.2		)			(377.2		)

Cash provided by (utilized in) financing activities	209.0					(574.3		)			(365.3		)

Effect of exchange rate change on cash						(22.9		)			(22.9		)

Net change in cash	—			—		(8.2		)	—		(8.2		)

Cash at beginning of period						387.7					387.7

Cash at end of period	$	—		$	—	$	379.5		$	—	$	379.5

	Year ended December 31, 2007
Cash Flows	Parent			Guarantor Subsidiaries		Non- Guarantor Subsidiaries			Eliminations		Consolidated

Cash provided by (utilized in) operating activities	$	(347.1	)	$	—	$	1,012.1		$	—	$	665.0

Cash provided by investing activities						1,444.4					1,444.4

Cash provided by (utilized in) financing activities	347.1					(2,343.3		)			(1,996.2		)

Effect of exchange rate change on cash						51.8					51.8

Net change in cash	—			—		165.0			—		165.0

Cash at beginning of period						222.7					222.7

Cash at end of period	$	—		$	—	$	387.7		$	—	$	387.7

- Definition

Text block that encapsulates the detailed table comprising the condensed financial statements (balance sheet, income statement and statement of cash flows), normally using the registrant (parent) as the sole domain member. If condensed consolidating financial statements are being presented, other domain members (in addition to parent) such as guarantor subsidiaries, non-guarantor subsidiaries, and the consolidation eliminations, will be included in order that the respective monetary amounts for each of the domains will aggregate to the respective amounts on the consolidated financial statements. The line items are the various captions used to compile the condensed financial statements. Using extensions, most, if not all, of the elements representing condensed financial statement captions will be the same as those used for the consolidated financial statements captions.

+ References+ Details

Selected Quarterly Financial Data (unaudited)

12 Months Ended

Dec. 31, 2009

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Selected Quarterly Financial Data (unaudited)

Selected Quarterly Financial Data (unaudited) The following tables present selected financial data by quarter for the years ended December 31, 2009 and 2008:

2009

	First Quarter		Second Quarter		Third Quarter		Fourth Quarter			Year to Date
Net sales	$	1,519.0	$	1,807.0	$	1,874.6	$	1,865.9		$	7,066.5
Gross profit	$	296.8	$	407.4	$	448.7	$	331.0		$	1,483.9
Net earnings (loss) attributable to the Company (a)	$	45.1	$	149.3	$	126.7	$	(159.3	)	$	161.8
Earnings per share of common stock (b):

Basic:
Net earnings	$	0.27	$	0.89	$	0.75	$	(0.95	)	$	0.96

Diluted:
Net earnings	$	0.27	$	0.88	$	0.74	$	(0.95	)	$	0.95

(a) Amount for the first quarter includes charges of $50.4 million ($47.7 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.28.

Amount for the second quarter includes charges totaling $10.4 million (pretax and after tax amount attributable to the Company) for the following: (1) $5.2 million for note repurchase premiums and the write-off of finance fees related to debt that was repaid prior to its maturity; and (2) $5.2 million for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.06.

Amount for the third quarter includes charges of $57.5 million ($36.0 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.21.

Amount for the fourth quarter includes charges totaling $297.8 million ($291.4 million after tax amount attributable to the Company) for the following: (1) $180.0 million (pretax and after tax) to increase the accrual for estimated future asbestos-related costs; (2) $100.5 million ($93.8 million after tax amount attributable to the Company) for restructuring and asset impairment; and (3) $17.3 million ($17.6 million after tax amount attributable to the Company) for the remeasurement of certain bolivar-denominated assets and liabilities held outside of Venezuela. The effect of these charges is a reduction in earnings per share of $1.71.

Amount for the fourth quarter includes a non-cash tax benefit transferred from other comprehensive income (equity) of $47.9 million. The effect of this tax benefit is an increase in earnings per share of $0.28.

(b) Earnings per share are computed independently for each period presented. As such, the sums of the amounts calculated separately for each quarter do not equal the year-to-date amount.

2008

	First Quarter		Second Quarter		Third Quarter		Fourth Quarter			Year to Date
Net sales	$	1,960.5	$	2,210.6	$	2,008.6	$	1,705.0		$	7,884.7
Gross profit	$	456.8	$	525.2	$	407.3	$	287.3		$	1,676.6

Amounts attributable to the Company:
Earnings (loss) from continuing operations (c)	174.0		227.5		78.6		(228.6		)	251.5
Gain (loss) on sale of discontinued operations	4.1		3.8				(1.1		)	6.8
Net earnings (loss)	$	178.1	$	231.3	$	78.6	$	(229.7	)	$	258.3
Earnings (loss) per share of common stock (d):
Basic:
Earnings (loss) from continuing operations	$	1.06	$	1.37	$	0.47	$	(1.38	)	$	1.49
Gain (loss) on sale of discontinued operations	0.03		0.02				(0.01		)	0.04
Net earnings (loss)	$	1.09	$	1.39	$	0.47	$	(1.39	)	$	1.53
Diluted:
Earnings (loss) from continuing operations	$	1.02	$	1.33	$	0.46	$	(1.38	)	$	1.48
Gain (loss) on sale of discontinued operations	0.02		0.02				(0.01		)	0.04
Net earnings (loss)	$	1.04	$	1.35	$	0.46	$	(1.39	)	$	1.52

(c) Amount for the first quarter includes charges of $12.9 million ($9.7 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.06.

Amount for the second quarter includes charges of $8.2 million ($4.2 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.02.

Amount for the third quarter includes charges of $90.6 million ($79.7 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $0.47. Amount for the third quarter also includes a net benefit of $6.2 million ($4.6 million after tax amount attributable to the Company) related to tax legislation and restructuring in Europe. The effect of this benefit is an increase in earnings per share of $0.03.

Amount for the fourth quarter includes charges totaling $271.6 million ($265.3 million after tax amount attributable to the Company) for the following: (1) $250.0 million ($248.8 million after tax) to increase the accrual for estimated future asbestos-related costs; and (2) $21.6 million ($16.5 million after tax amount attributable to the Company) for restructuring and asset impairment. The effect of these charges is a reduction in earnings per share of $1.56.

Amount for the fourth quarter includes expense of $39.5 million related to tax restructuring and other. The effect of this expense is a decrease in earnings per share of $0.23.

The Company adopted the provisions of a new accounting standard on January 1, 2009, which required the Company to allocate earnings to unvested restricted shares outstanding during the period and was also required to be retrospectively applied to 2008. Basic earnings per share for the first and second quarters of 2008 were reduced by $0.02 and $0.01 per share, respectively. There was no impact on basic earnings per share for the third and fourth quarters of 2008. The overall impact on basic earnings per share for the year ended December 31, 2008 was a reduction of $0.03 per share. There was no impact on diluted earnings per share in any period presented.

(d) Earnings per share are computed independently for each period presented. As such, the sums of the amounts calculated separately for each quarter do not equal the year-to-date amount.

- Definition

This element can be used to disclose the entire quarterly financial data disclosure in the annual financial statements as a single block of text. The disclosure includes a tabular presentation of financial information for each fiscal quarter for the current and previous year, including revenues, gross profit, income (loss) before extraordinary items and cumulative effect of a change in accounting principle and earnings per share data. It also includes an indication if the information in the note is unaudited, comments on the aggregate effect of year-end adjustments, and an explanation of matters or transactions that affect comparability or are pertinent to an understanding of the information furnished. Alternatively, the details of this disclosure can be reported using the elements in this group, or by using other taxonomy elements and applying the appropriate quarterly date and period contexts when creating an instance document. For example, the element for "Interest and Dividend Income, Operating" may be used by financial institutions from the Statement of Income, applying the appropriate quarterly date and period context when creating an instance document.

+ References+ Details

Schedule II

12 Months Ended

Dec. 31, 2009

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (CONSOLIDATED)

SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS (CONSOLIDATED)

OWENS-ILLINOIS, INC.

SCHEDULE II — VALUATION AND QUALIFYING ACCOUNTS (CONSOLIDATED)

Years ended December 31, 2009, 2008, and 2007

(Millions of Dollars)

Reserves deducted from assets in the balance sheets:

Allowances for losses and discounts on receivables

			Additions
	Balance at		Charged to								Balance
	beginning		costs and					Deductions			at end of
	of period		expenses		Other			(Note 1)			period

2009	$	39.7	$	1.7	$	(4.3	)	$	(0.6	)	$	36.5

2008	$	36.0	$	8.1	$	(0.7	)	$	3.7		$	39.7

2007	$	28.7	$	4.1	$	8.1		$	4.9		$	36.0

(1) Deductions from allowances for losses and discounts on receivables represent uncollectible notes and accounts written off.

Document and Entity Information (USD $)	12 Months Ended
Document and Entity Information (USD $)	Dec. 31, 2009	Jun. 30, 2009
Document and Entity Information
Entity Registrant Name	OWENS ILLINOIS INC /DE/
Entity Central Index Key	0000812074
Document Type	10-K
Document Period End Date	Dec. 31, 2009
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Voluntary Filers	No
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Public Float		$ 3,569,806,000
Entity Common Stock, Shares Outstanding	168,600,765