RESTRUCTURING

2009 Restructuring Charges

On June 30, 2009, the Board of Directors of UCC approved a restructuring plan to improve the cost effectiveness of the Corporation's global operations. As a result, the Corporation recorded restructuring charges of $162 million in the second quarter of 2009, which included the shutdown of certain facilities that produced ethylene as well as ethylene oxide/ethylene glycol in Hahnville, Louisiana ($38 million) and certain related capital project write-offs ($7 million). In addition, due to the expected loss arising from the United States Federal Trade Commission (“FTC”) required divestiture of certain specialty latex assets resulting from Dow's acquisition of Rohm and Haas Company on April 1, 2009, the Corporation recognized an impairment charge in the second quarter of 2009 ($114 million). Also, included in the second quarter restructuring charge was severance of approximately $3 million for 41 people related to the plant shutdowns and corporate workforce reductions. These charges are shown as “Restructuring charges” in the consolidated statements of income.

During 2009, severance of $2 million was paid, leaving a liability at December 31, 2009 of $1 million for approximately 16 employees. In the first quarter of 2010, the Corporation paid $1 million in severance, bringing the 2009 restructuring plan to a close.

The following table summarizes the activities related to the Corporation's 2009 restructuring reserve:



2009 Restructuring Activities In millions	Impairment of Long-lived Assets and Other Assets			Severance Costs			Total
Restructuring charges recognized in the second quarter of 2009	$	159		$	3		$	162
Charges against the reserve	(159		)	—			(159		)
Cash payments	—			(2		)	(2		)
Reserve balance at December 31, 2009	$	—		$	1		$	1
Adjustment to reserve	5			—			5
Charges against the reserve	(5		)	—			(5		)
Cash payments	—			(1		)	(1		)
Reserve balance at March 31, 2010	$	—		$	—		$	—

2009 Adjustments to Previous Restructuring Plans

During the first quarter of 2009, the Corporation identified an additional 50 employees to be separated under the 2008 restructuring plan, resulting in the recognition of an additional $4 million of severance cost. In the fourth quarter of 2009, the Corporation reduced the reserve related to the 2007 restructuring plan by $5 million related to severance costs, as redeployment opportunities for affected employees were identified. These adjustments are shown as "Restructuring charges" in the consolidated statements of income.

2010 Restructuring Charges

2010 Adjustments to Previous Restructuring Plans

In the first quarter of 2010, the Corporation recorded an additional $5 million charge to adjust the impairment of long-lived assets related to the FTC required divestiture of the specialty latex assets completed in the first quarter of 2010 (see Note D for additional information on this divestiture). The impact of the impairment charge is shown as “Restructuring charges” in the consolidated statements of income.

During 2010, severance of $2 million was paid, and the shutdowns and optimization activities related to the 2008 restructuring plan were substantially complete. As a result, the Corporation reversed the remaining $3 million severance reserve related to the 2008 restructuring plan. The impact of this adjustment is shown as “Restructuring charges” in the consolidated statements of income.