RESTRUCTURING

6 Months Ended

Jun. 30, 2011

Note 4. RESTRUCTURING

The following restructuring and other charges were recognized:

	Three Months Ended June 30,				Six Months Ended June 30,
Dollars in Millions	2011		2010		2011		2010
Employee termination benefits	$	25	$	27	$	68	$	37
Other exit costs		15		(3)		16		(2)
Provision for restructuring		40		24		84		35
Impairment and loss on sale of manufacturing operations		-		15		-		215
Accelerated depreciation, asset impairment and other shutdown costs		22		27		45		58
Pension curtailment and settlement charges		-		5		-		5
Process standardization implementation costs		6		6		10		19
Total restructuring and other charges	$	68	$	77	$	139	$	332

Restructuring charges were incurred to streamline the organizational structure of the Company. These charges include termination benefits for approximately 215 and 260 manufacturing, selling, administrative, and research and development personnel across all geographic regions for the three months ended June 30, 2011 and 2010, respectively, and approximately 650 and 480 manufacturing, selling, administrative, and research and development personnel across all geographic regions for the six months ended June 30, 2011 and 2010, respectively.

Most of the accelerated depreciation, asset impairment and other shutdown costs were included in cost of products sold and primarily relate to the rationalization of the manufacturing network. These assets continue to be depreciated until the cease use date of the facility. In connection with the continued optimization of the Company's manufacturing network, the operations in Latina, Italy were sold to International Chemical Investors, SE (ICI) in May 2010 resulting in a $215 million loss. The loss consisted of a $200 million impairment charge recorded to other income/(expense) attributed to the write-down of assets to fair value less cost of sale when the assets met the held for sale criteria and $15 million of other working capital adjustments and transaction related fees recorded upon closing. Process standardization activities are recognized as incurred in marketing, selling and administrative expense.

The following table represents the activity of employee termination and other exit cost liabilities:

	Six Months Ended June 30,
Dollars in Millions	2011		2010
Liability at January 1	$	126	$	173
Charges		86		34
Changes in estimates		(2)		1
Provision for restructuring		84		35
Foreign currency translation		1		(6)
Spending		(83)		(69)
Liability at June 30	$	128	$	133

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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