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UNITED STATES SECURITIES AND
    EXCHANGE COMMISSIONWashington, D.C.
    20549
 Form 10-K
  (Mark One)þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended
    December 31,
    2010oro

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
    OF THE SECURITIES EXCHANGE ACT OF 1934   Commission File Number 1-12084
 LIBBEY INC.
 (Exact name of registrant as
    specified in its charter)
  Delaware

34-1559357(State or Other Jurisdiction
    of
    Incorporation or Organization)

(IRS Employer
    Identification No.)300 Madison Avenue, Toledo, Ohio(Address of Principal
    Executive Offices)

43604(Zip
    Code)    (419) 325-2100
 (Registrants telephone
    number, including area code)
  Securities registered pursuant to Section 12(b) of the
    Act:
 Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock, $.01 par value

NYSE AMEX   Securities registered pursuant to Section 12(g) of the
    Act:
    None
  o þ
  o þ
  þ o
  Regulation S-T o o
  Regulation S-K Form 10-K Form 10-K. þ
  12b-2
  Large
    accelerated
    filer o
    Accelerated
    filer þ
    Non-accelerated
    filer o
    Smaller
    reporting
    company o   Rule 12b-2 o þ
      DOCUMENTS
    INCORPORATED BY REFERENCE
  Form 10-K
  Form 10-K




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##### 





TABLE OF
    CONTENTS
   
 PART IITEM 1.

BUSINESS


3EXECUTIVE OFFICERS OF THE REGISTRANT


10ITEM 1A.

RISK FACTORS


12ITEM 1B.

UNRESOLVED STAFF COMMENTS


23ITEM 2.

PROPERTIES


24ITEM 3.

LEGAL PROCEEDINGS


24PART IIITEM 5.

MARKET FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER
    MATTERS, AND ISSUER PURCHASES OF EQUITY SECURITIES


25ITEM 6.

SELECTED FINANCIAL DATA


27ITEM 7.

MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
    AND RESULTS OF OPERATIONS


27ITEM 7A.

QUALITATIVE AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK


53ITEM 8.

FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


55ITEM 9.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE


122ITEM 9A.

CONTROLS AND PROCEDURES


122ITEM 9B.

OTHER INFORMATION


123PART IIIITEM 10.

DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE


123ITEM 11.

EXECUTIVE COMPENSATION


123ITEM 12.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
    AND RELATED STOCKHOLDER MATTERS


123ITEM 13.

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE


124ITEM 14.

PRINCIPAL ACCOUNTING FEES AND SERVICES


124PART IVITEM 15.

EXHIBITS, FINANCIAL STATEMENT SCHEDULES


124SIGNATURES


125INDEX TO FINANCIAL STATEMENT SCHEDULE


127CERTIFICATIONS


C-1EX-13.1EX-21EX-23EX-24EX-31.1EX-31.2EX-32.1EX-32.2   2




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This Annual Report on
    Form 10-K,
    including Managements Discussion and Analysis of
    Financial Condition and Results of Operations, contains
    forward-looking statements regarding future events and future
    results that are subject to the safe harbors created under the
    Securities Act of 1933 and the Securities Exchange Act of 1934.
    Libbey desires to take advantage of the safe harbor
    provisions of the Private Securities Litigation Reform Act of
    1995. These statements are based on current expectations,
    estimates, forecasts and projections, and the beliefs and
    assumptions of our management. Words such as expect,
    anticipate, target, believe,
    intend, may, planned,
    potential, should, will,
    would, variations of such words, and similar
    expressions are intended to identify these forward-looking
    statements. In addition, any statements that refer to
    projections of our future financial performance, our anticipated
    growth and trends in our businesses, and other characterizations
    of future events or circumstances, are forward-looking
    statements. Readers are cautioned that these forward-looking
    statements are only predictions and are subject to risks,
    uncertainties and assumptions that are difficult to predict.
    Therefore, actual results may differ materially and adversely
    from those expressed in any forward-looking statements. We
    undertake no obligation to revise or update any forward-looking
    statements for any reason.
 PART I  ITEM 1.
    BUSINESS  General
  ® ® ® ® ® ® business-to-business ® state-of-the-art ® ® ®
    www.libbey.com. Form 10-K, Form 10-Q Form 8-K,
   3




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Growth
    Strategy
  business-to-business
        Products
      Customers
   4




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business-to-business business-to-business
  Sales,
    Marketing and Distribution
        ® ® ®
  business-to-business
  Foodservice
  ® ® ®
  Retail
  www.libbey.com
 5




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Business-to-Business
  business-to-business business-to-business business-to-business
  Seasonality
    Backlog
  and/or
  Manufacturing
    and Sourcing
       6




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Materials
    Research
    and Development
    and/or
  Patents,
    Trademarks and Licenses
  ® ® ® ® ® ® ®
    Competitors
      
    Arc International (a French company), which manufactures and
    distributes glass tableware to retail, foodservice and
    business-to-business
    customers worldwide;
    Paşabahçe (a unit of Şişecam, a Turkish
    company), which manufactures glass tableware at various sites
    throughout the world and sells to retail, foodservice and
    business-to-business
    customers worldwide; 7




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
    Anchor Hocking Company (a U.S. company), which manufactures
    and distributes glass beverageware, industrial products and
    bakeware primarily to retail, industrial and foodservice
    channels in the U.S. and Canada;
    Bormioli Rocco Group (an Italian company), which manufactures
    glass tableware in Europe, where the majority of its sales are
    to retail and foodservice customers;
    various manufacturers in China; and
    various sourcing companies.      
    Homer Laughlin;
    Oneida Ltd.;
    Steelite; and
    various sourcing companies.    
    Oneida Ltd.;
    Walco, Inc.; and
    various sourcing companies.    
    Cambro Manufacturing Company;
    Carlisle Companies Incorporated; and
    various sourcing companies.  Environmental
    Matters
       8




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sub-site sub-site sub-site,
  clean-up sub-site
    No. CGC-003-418025
   9




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Employees
     EXECUTIVE
    OFFICERS OF THE REGISTRANT    Name and Title

Professional BackgroundJohn F. Meier
     Chairman and Chief
     Executive Officer

Mr. Meier, 63 has been Chairman of the Board and Chief Executive
    Officer of Libbey Inc. since the Company went public in June
    1993.  Since joining the Company in 1970, Mr. Meier has served
    in various marketing positions, including a five-year assignment
    with Durobor, S.A., Belgium. In 1990, Mr. Meier was named
    General Manager of Libbey and a corporate Vice President of
    Owens-Illinois, Inc., Libbeys former parent company. Mr.
    Meier is a member of the Board of Directors of Cooper Tire
    & Rubber Company (NYSE: CTB) and Applied Industrial
    Technologies (NYSE: AIT). Mr. Meier has been a director of
    the Company since 1987.  Mr. Meier recently announced his
    plans to retire by the end of 2011.Richard I. Reynolds
     Executive Vice President
     and Chief Financial Officer

Mr. Reynolds, 64, has served as Libbeys Executive Vice
    President and Chief Financial Officer since June, 2010.  Mr.
    Reynolds also served as Vice President and Chief Financial
    Office from June 1993 to 1995.  In addition, Mr. Reynolds was
    Libbeys Executive Vice President and Chief Operating
    Officer from 1995 to June, 2010.  From 1989 to June 1993, Mr.
    Reynolds was Director of Finance and Administration.
    Mr. Reynolds has been with Libbey since 1970 and has been a
    director of the Company since 1993.Gregory T. Geswein
     Vice President, Strategic Planning
     and Business Development

Mr. Geswein, 56, has served as Libbeys Vice President,
    Strategic Planning and Business Development since June, 2010.
    Mr. Geswein served as Libbeys Vice President, Chief
    Financial Officer from May 23, 2007, when he joined Libbey
    until June, 2010. Prior to joining Libbey, Mr. Geswein was
    Senior Vice President, Chief Financial Officer of Reynolds
    & Reynolds Company in Dayton, Ohio, from 2005 through April
    2007. Before joining Reynolds & Reynolds, Mr. Geswein was
    Senior Vice President, Chief Financial Officer for Diebold, Inc.
    from 2000 to August 12, 2005 and Senior Vice President, Chief
    Financial Officer of Pioneer-Standard Electronics Inc. from 1999
    to 2000. Prior to joining Pioneer- 10




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Name and Title

Professional BackgroundStandard Electronics, Mr. Geswein spent 14 years at Mead
    Corporation (now MeadWestvaco) in successive financial
    management positions, including Vice President and Controller,
    and Treasurer.  On June 2, 2010, the Securities and Exchange
    Commission filed a civil complaint against Mr. Geswein and
    certain other individuals previously or currently employed by
    Diebold, Inc.  The allegations contained in the civil complaint
    relate to Mr. Gesweins prior employment as Chief Financial
    Officer of Diebold, Inc. None of the allegations involves Libbey
    or Libbey Inc.Kenneth A. Boerger
     Vice President
     and Treasurer

Mr. Boerger, 52, has been Vice President and Treasurer of Libbey
    Inc. since July 1999. From 1994 to July 1999, Mr. Boerger was
    Corporate Controller and Assistant Treasurer. Since joining the
    Company in 1984, Mr. Boerger has held various financial and
    accounting positions. He has been involved in the Companys
    financial matters since 1980, when he joined Owens-Illinois,
    Inc., Libbeys former parent company.Jonathan S. Freeman
     Vice President, Global Supply 
     Chain

Mr. Freeman, 49, joined Libbey Inc. as Vice President, Global
    Supply Chain on May 7, 2007.  Prior to joining Libbey, Mr.
    Freeman was with Delphi Corporation and Packard Electric
    Systems, a division of General Motors (the former parent of
    Delphi), since 1985, serving most recently as Director of Global
    Logistics. Mr. Freeman has worked in a wide range of operations
    and supply chain assignments in the United States, Mexico and
    Europe.Daniel P. Ibele
     Vice President,
     Global Sales and Marketing

Mr. Ibele, 50, has served as Libbey Inc.s Vice President,
    Global Sales and Marketing since June, 2010. Mr. Ibele was Vice
    President, General Sales Manager, North America from June 2006
    to June 2010. From March 2002 to June 2006 he was Vice
    President, General Sales Manager of the Company. Previously, Mr.
    Ibele had been Vice President, Marketing and Specialty
    Operations since September 1997.  Mr. Ibele was Vice President
    and Director of Marketing at Libbey from 1995 to September
    1997.  From the time he joined Libbey in 1983 until 1995, Mr.
    Ibele held various marketing and sales positions.Susan A. Kovach
     Vice President,
     General Counsel and Secretary

Ms. Kovach, 51, has been Vice President, General Counsel and
    Secretary of Libbey Inc. since July 2004. She joined Libbey in
    December 2003 as Vice President, Associate General Counsel and
    Assistant Secretary. Prior to joining Libbey, Ms. Kovach was Of
    Counsel to Dykema Gossett PLLC from 2001 through November 2003.
    She served from 1997 to 2001 as Vice President, General Counsel
    and Corporate Secretary of Omega Healthcare Investors, Inc.
    (NYSE: OHI).  From 1998 to 2000 she held the same position for
    Omega Worldwide, Inc., a NASDAQ-listed firm providing management
    services and financing to the aged care industry in the United
    Kingdom and Australia. Prior to joining Omega Healthcare
    Investors, Inc., Ms. Kovach was a partner in Dykema Gossett PLLC
    from 1995 through November 1997 and an associate in Dykema
    Gossett PLLC from 1985 to 1995. 11




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Name and Title

Professional BackgroundTimothy T. Paige
     Vice President,
     Administration

Mr. Paige, 53, has been Vice President-Administration of Libbey
    Inc. since December 2002. From January 1997 until December 2002,
    Mr. Paige was Vice President and Director of Human
    Resources of the Company.  From May 1995 to January 1997, Mr.
    Paige was Director of Human Resources of the Company.  Prior to
    joining the Company, Mr. Paige was employed by Frito-Lay,
    Inc. in human resources management positions.Scott M. Sellick
     Vice President and
     Chief Accounting Officer

Mr. Sellick, 48, has served as Vice President, Chief Accounting
    Officer of Libbey Inc. since May 2007.  From May 2003 to
    May 2007, Mr. Sellick served as Vice President, Chief
    Financial Officer of the Company, and from May 2002 to May 2003,
    Mr. Sellick was Libbeys Director of Tax and
    Accounting. From August 1997 to May 2002, he served as Director
    of Taxation. Before joining the Company in August 1997, Mr.
    Sellick was Tax Director for Stant Corporation and worked in
    public accounting for Deloitte & Touche in the audit and
    tax areas.Roberto B. Rubio
     Vice President,
     Global Manufacturing and Engineering

Mr. Rubio, 55, has served as Vice President, Global
    Manufacturing and Engineering since June 2010.  Mr. Rubio was
    Vice President, General Manager, International Operations of
    Libbey Inc. from November 2009 until June 2010.  He joined the
    Company in July 2009 as Vice President, Managing Director,
    Libbey Mexico.  Prior to joining Libbey, Mr. Rubio was employed
    by Vitro S.A.B. de C.V., which he joined in 1980.  While
    employed by Vitro, Mr. Rubio progressed through numerous
    positions of increasing scope and responsibility. In 1996, Mr.
    Rubio was named President of Vitrocrisa, the glass tableware
    division of Vitro that is now wholly owned by Libbey.  In 1999,
    Mr. Rubio was named President of the glass container division of
    Vitro, and in 2001 Mr. Rubio was named President of Vitros
    flat glass division.  In 2003, Mr. Rubio assumed operations
    responsibility for both the glass container division and the
    glass tableware division, including Vitrocrisa.  From the time
    of Libbeys acquisition in 2006 of the remaining
    51 percent interest in Vitrocrisa (which Libbey renamed
    Crisa) that it did not previously own until July 2009, Mr. Rubio
    led Crisa, while at the same time carrying out other senior
    management responsibilities for Vitro.  At the time of his
    retirement from Vitro in June 2009, Mr. Rubio was serving as
    President of Vitros flat glass division.   ITEM 1A.
    RISK
    FACTORS  year-to-year
  Slowdowns
    in the retail, travel, restaurant and bar or entertainment
    industries, such as those caused by general economic downturns,
    terrorism or political or social unrest, health concerns or
    strikes or bankruptcies within those industries, could reduce
    our revenues and production activity levels.
   12




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and/or
  
    the financial stability of our customers or suppliers may be
    compromised, which could result in additional bad debts for us
    or non-performance by suppliers;
    it may become more costly or difficult to obtain financing or
    refinance our debt in the future;
    the value of our assets held in pension plans may decline; and/or
    our assets may be impaired or subject to write-down or write-off.  and/or and/or
  Our
    high level of debt, as well as incurrence of additional debt,
    may limit our operating flexibility, which could adversely
    affect our results of operations and financial
    condition.
    
    approximately $400.0 million consisted of the Senior
    Secured Notes, which were secured by a first-priority lien on
    substantially all of the owned real property, equipment and
    fixtures in the United States of Libbey Glass and its domestic
    subsidiaries, subject to certain exceptions and permitted liens
    and a second-priority lien on substantially all of the existing
    and future real and personal property (including without
    limitation tangible and intangible assets) of Libbey Glass and
    its domestic subsidiaries (other than certain real property and
    equipment located in the United States and certain general
    intangibles, instruments, books and records and supporting
    obligations related to such real property and equipment, and
    certain proceeds of the foregoing);
    we had no debt outstanding under our amended and restated ABL
    Facility, which was secured by a first-priority lien on certain
    inventories and receivables, although we had $10.4 million
    of letters of credit issued under that facility;
    RMB 250 million (approximately $37.9 million at
    December 31, 2010) consisted of a loan made by China
    Construction Bank Corporation Langfang Economic Development Area
    Sub-branch,
    which we refer to as CCB. We used the proceeds of this loan to
    finance the construction of our manufacturing facility in China
    that began operations in early 2007;
    8.3 million (approximately $10.9 million at
    December 31, 2010) consisted of a loan made by Banco
    Espirito Santo, S.A., which we refer to as the BES Euro Line, to
    finance operational improvements associated with our Portuguese
    operations; and
    approximately $1.3 million consisted of amounts we owed
    under a promissory note related to the purchase of our Laredo,
    Texas warehouse.   13




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
    making it more difficult for us to satisfy our financial
    obligations;
    limiting our ability to make capital investments in order to
    expand our business;
    limiting our ability to obtain additional debt or equity
    financing for working capital, capital expenditures, product
    development, debt service requirements, acquisitions or other
    purposes;
    limiting our ability to invest operating cash flow in our
    business and future business opportunities, because we use a
    substantial portion of these funds to service debt and because
    our covenants restrict the amount of our investments;
    limiting our ability to withstand business and economic
    downturns
    and/or
    placing us at a competitive disadvantage compared to our
    competitors that have less debt, because of the high percentage
    of our operating cash flow that is dedicated to servicing our
    debt; and
    limiting our ability to pay dividends.      International
    economic and political factors could affect demand for imports
    and exports, and our financial condition and results of
    operations could be adversely impacted as a
    result.
  and/or
 14




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Fluctuation
    of the currencies in which we conduct operations could adversely
    affect our financial condition and results of operations or
    reduce the cost competitiveness of our products or those of our
    subsidiaries.
  non-U.S. subsidiaries.
  non-U.S. subsidiaries
  U.S.-manufactured
  Our
    business requires us to maintain a large fixed-cost base that
    can affect our profitability.
    We may
    not be able to achieve the international growth contemplated by
    our strategy.
    We
    face intense competition and competitive pressures, which could
    adversely affect our results of operations and financial
    condition.
      
    Arc International (a French company), which manufactures and
    distributes glass tableware worldwide;
    Paşabahçe (a unit of Şişecam, a Turkish
    company), which manufactures glass tableware at various sites
    throughout the world and sells to retail, foodservice and
    business-to-business
    customers worldwide;
    Anchor Hocking Company (a U.S. company), which manufactures
    and distributes glass beverageware, industrial products and
    bakeware primarily to retail, industrial and foodservice
    channels in the United States and Canada; 15




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
    Bormioli Rocco Group (an Italian company), which manufactures
    glass tableware in Europe, where the majority of its sales are
    to retail and foodservice customers;
    various manufacturers in China; and
    various sourcing companies.        We
    conduct significant operations at our facility in Monterrey,
    Mexico, which could be materially adversely affected as a result
    of the increased levels of drug-related violence in that
    city.
    We may
    not be able to renegotiate collective bargaining agreements
    successfully when they expire; organized strikes or work
    stoppages by unionized employees may have an adverse effect on
    our operating performance.
     16




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The
    inability to extend or refinance debt of our foreign
    subsidiaries, or the calling of that debt before scheduled
    maturity, could adversely impact our liquidity and financial
    condition.
      Our
    cost-reduction projects may not result in anticipated savings in
    operating costs.
    We are
    subject to risks associated with operating in foreign countries.
    These risks could adversely affect our results of operations and
    financial condition.
    
    political, social and economic instability;
    war, civil disturbance or acts of terrorism;
    taking of property by nationalization or expropriation without
    fair compensation;
    changes in government policies and regulations;
    devaluations and fluctuations in currency exchange rates;
    imposition of limitations on conversions of foreign currencies
    into dollars or remittance of dividends and other payments by
    foreign subsidiaries;
    imposition or increase of withholding and other taxes on
    remittances and other payments by foreign subsidiaries; 17




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
    ineffective intellectual property protection;
    hyperinflation in certain foreign countries; and
    impositions or increase of investment and other restrictions or
    requirements by foreign governments.    If we
    have a fair value impairment in a business segment, our net
    earnings and net worth could be materially and adversely
    affected by a write-down of goodwill, intangible assets or fixed
    assets.
      A
    severe outbreak, epidemic or pandemic of the H1N1 virus or other
    contagious disease in a location where we have a facility could
    adversely impact our results of operations and financial
    condition.
   18




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We are
    subject to various environmental legal requirements and may be
    subject to new legal requirements in the future; these
    requirements could have a material adverse effect on our
    operations.
  clean-up
    If we
    are unable to obtain raw materials or sourced products or
    utilities at favorable prices, or at all, our operating
    performance may be adversely affected.
    Unexpected
    equipment failures may lead to production curtailments or
    shutdowns.
  force majeure
  High
    levels of inflation and high interest rates in Mexico and China
    could adversely affect the operating results and cash flows of
    our operations there.
   19




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Charges
    related to our employee pension and postretirement welfare plans
    resulting from market risk and headcount realignment may
    adversely affect our results of operations and financial
    condition.
  non-U.S. plans non-U.S. plans
  
    A change of 1 percent in the discount rate would change our
    total pension and postretirement welfare expense by
    approximately $4.5 million.
    A change of 1 percent in the expected long-term rate of
    return on plan assets would change total pension expense by
    approximately $2.4 million.    If our
    hedges do not qualify as highly effective or if we do not
    believe that forecasted transactions would occur, the changes in
    the fair value of the derivatives used as hedges would be
    reflected in our earnings.
    If
    counterparties to our hedge agreements fail to perform, the
    hedge agreements would not protect us from fluctuations in
    certain commodity pricing.
    Our
    business may suffer if we do not retain our senior
    management.
   20




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We
    rely on increasingly complex information systems for management
    of our manufacturing, distribution, sales and other functions.
    If our information systems fail to perform these functions
    adequately, or if we experience an interruption in their
    operation, our business and results of operations could
    suffer.
    
    earthquake, fire, flood, hurricane and other natural disasters;
    power loss, computer systems failure, internet and
    telecommunications or data network failure; and
    hackers, computer viruses, software bugs or glitches.    We may
    not be able to effectively integrate future businesses we
    acquire or joint ventures we enter into.
    
    the inability to integrate effectively the operations, products,
    technologies and personnel of the acquired companies (some of
    which may be spread out in different geographic regions) and to
    achieve expected synergies;
    the potential disruption of existing business and diversion of
    managements attention from
    day-to-day
    operations;
    the inability to maintain uniform standards, controls,
    procedures and policies or correct deficient standards,
    controls, procedures and policies, including internal controls
    and procedures sufficient to satisfy regulatory requirements of
    a public company in the United States;
    the incurrence of contingent obligations that were not
    anticipated at the time of the acquisitions;
    the failure to obtain necessary transition services such as
    management services, information technology services and others;
    the need or obligation to divest portions of the acquired
    companies; and
    the potential impairment of relationships with customers.   21




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Our
    business requires significant capital investment and maintenance
    expenditures that we may be unable to fulfill.
      Natural
    gas, the principal fuel we use to manufacture our products, is
    subject to fluctuating prices; fluctuations in natural gas
    prices could adversely affect our results of operations and
    financial condition.
    If our
    investments in new technology and other capital expenditures do
    not yield expected returns, our results of operations could be
    reduced.
    Our
    failure to protect our intellectual property or prevail in any
    intellectual property litigation could materially and adversely
    affect our competitive position, reduce revenue or otherwise
    harm our business.
  and/or
  Devaluation
    or depreciation of, or governmental conversion controls over,
    the foreign currencies in which we operate could affect our
    ability to convert the earnings of our foreign subsidiaries into
    U.S. dollars.
   22




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Payment
    of severance or retirement benefits earlier than anticipated
    could strain our cash flow.
    We are
    involved in litigation from time to time in the ordinary course
    of business.
    Our
    products are subject to various health and safety requirements
    and may be subject to new health and safety requirements in the
    future; these requirements could have a material adverse effect
    on our operations.
    ITEM 1B.
    UNRESOLVED
    STAFF COMMENTS   23




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ITEM 2.
    PROPERTIES    North American Glass


North American Other


InternationalLocation

Owned


Leased


Owned


Leased


Owned


LeasedToledo, Ohio:Manufacturing


733,800



Warehousing/Distribution


713,100



598,200Shreveport, Louisiana:Manufacturing


525,000



Warehousing/Distribution


166,000



646,000Syracuse, New York(1):Manufacturing










549,000



Warehousing/Distribution










104,000



Dane, Wisconsin:Manufacturing










56,000



Warehousing/Distribution










61,000



Monterrey, Mexico:Manufacturing


534,000



173,000Warehousing/Distribution


228,000



645,000Leerdam, Netherlands:Manufacturing


















141,000



Warehousing/Distribution


















127,000



442,000Laredo, Texas:Warehousing/Distribution


149,000



117,000West Chicago, Illinois:Warehousing/Distribution














249,000Marinha Grande, Portugal:Manufacturing


















217,000



Warehousing/Distribution


















193,000



13,000Langfang, China:Manufacturing


















195,000



Warehousing/Distribution


















232,000



     (1)
    
    We ceased production and distribution at our Syracuse China
    ceramic dinnerware manufacturing facility in April 2009.  month-to-month
    ITEM 3.
    LEGAL
    PROCEEDINGS    ITEM 4.
    RESERVED 24




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PART II  ITEM 5.
    MARKET
    FOR REGISTRANTS COMMON EQUITY, RELATED STOCKHOLDER MATTERS
    AND ISSUER PURCHASES OF EQUITY SECURITIES  Common
    Stock and Dividends
  LBY.
  2010


2009Cash








CashPrice Range


Dividend


Price Range


DividendHigh


Low


Declared


High


Low


DeclaredFirst Quarter

$
14.25


$
7.23


$



$
2.05


$
0.73


$
Second Quarter

$
15.00


$
12.15


$



$
2.75


$
0.47


$
Third Quarter

$
14.03


$
9.88


$



$
4.27


$
1.30


$
Fourth Quarter

$
15.47


$
12.36


$



$
7.99


$
3.75


$
       Comparison
    of Cumulative Total Returns
   25




---



##### Table of Contents



TOTAL
    SHAREHOLDER RETURN
  
  Annual Return Percentage Years EndingCompany/Index

Dec 06


Dec 07


Dec 08


Dec 09


Dec 10Libbey Inc.


21.97



29.12



(92.00
)


512.00



102.22Russell 2000 Index


18.37



(1.57
)


(33.79
)


27.17



26.85S&P 600 Housewares & Specialties


10.07



8.57



(40.75
)


52.97



(6.53
)   Indexed Returns Years EndingBasePeriodCompany/Index

Dec 05


Dec 06


Dec 07


Dec 08


Dec 09


Dec 10Libbey Inc.


100



121.97



157.49



12.59



77.08



155.86Russell 2000 Index


100



118.37



116.51



77.15



98.11



124.46S&P 600 Housewares & Specialties


100



110.07



119.50



70.80



108.31



101.24  26




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##### Table of Contents



Equity
    Compensation Plan Information
    Number ofSecurities to be





Number ofIssued Upon


Weighted Average


SecuritiesExercise of


Exercise Price of


Remaining AvailableOutstanding


Outstanding


for Future IssuanceOptions, Warrants


Options, Warrants


Under EquityPlan Category

and Rights


and Rights


Compensation PlansEquity compensation plans approved by security holders


1,716,184


$
15.57



1,398,778Equity compensation plans not approved by security holders










Total


1,716,184


$
15.57



1,398,778   Issuer
    Purchases of Equity Securities
    Total Number of


Maximum NumberShares Purchased


of Shares that Mayas part of Publicly


Yet Be PurchasedTotal Number of


Average Price Paid


Announced Plans


Under the Plans orPeriod

Shares Purchased


per Share


or Programs


Programs(1)October 1 to October 31, 2010














1,000,000November 1 to November 30, 2010














1,000,000December 1 to December 31, 2010














1,000,000Total














1,000,000     (1)
    
    We announced on December 10, 2002, that our Board of
    Directors authorized the purchase of up to 2,500,000 shares
    of our common stock in the open market and negotiated purchases.
    There is no expiration date for this plan. In 2003,
    1,500,000 shares of our common stock were purchased for
    $38.9 million. No additional shares were purchased in 2010,
    2009, 2008, 2007, 2006, 2005 or 2004. Our ABL Facility and the
    indentures governing the Senior Secured Notes significantly
    restrict our ability to repurchase additional shares.  ITEM 6.
    SELECTED
    FINANCIAL DATA    ITEM 7.
    MANAGEMENTS
    DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
    OPERATIONS  FORWARD
    LOOKING STATEMENTS
     27




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##### Table of Contents



OVERVIEW
  GENERAL
  business-to-business
    
    North American Glass  includes sales of glass
    tableware from subsidiaries throughout the United States, Canada
    and Mexico.
    North American Other  includes sales of ceramic
    dinnerware; metal tableware, hollowware and serveware; and
    plastic items from subsidiaries in the United States.
    International  includes worldwide sales of glass
    tableware from subsidiaries outside the United States, Canada
    and Mexico.  EXECUTIVE
    OVERVIEW
    
    Higher net sales and a more favorable mix of sales.
    Increased production activity, net of increased costs inherent
    in the higher level of activity. All factories ran at
    exceptionally high levels throughout the year, with Mexico
    running full for the entire year.
    Libbeys LEAN initiative has been in place for five years.
    Our USA factories and our Dutch factory are now organized along
    value streams.      
    In October 2009, we restructured a portion of our debt by
    exchanging our Old PIK Notes in the face amount of
    $160.9 million for New PIK Notes in the face amount of
    $80.4 million and additional common stock and warrants of
    Libbey Inc. In August 2010, the Company successfully concluded a
    secondary offering of these additional shares of common stock
    and the shares of common stock underlying these warrants.
    On February 8, 2010, we used the proceeds of a
    $400.0 million debt offering (Senior Secured Notes) and
    cash on hand to redeem the New PIK Notes and repurchase the
    $306.0 million Floating Rate Senior Secured Notes due 2011.
    We also amended our ABL Facility. 28




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##### Table of Contents




    We increased our leading U.S. retail market share for the
    fifth year in a row. According to NPD Group Retail Tracking
    Services, we now have 46.6 percent of the causal
    beverageware market in the U.S. retail channel.
    Our Crisa business in Mexico had a strong year, with net sales
    up 21.9 percent compared to 2009.
    Net sales in our U.S. and Canadian retail business grew
    more than 6.0 percent.
    Libbey China had a net sales increase of 29.4 percent
    compared to 2009.  RESULTS
    OF OPERATIONS
    Variance








VarianceIn


In








In


InYear End December 31,

2010


2009


Dollars


Percent


2009


2008


Dollars


Percent(Dollars in thousands, except percentages and per-share
    amounts)Net sales

$
799,794


$
748,635


$
51,159



6.8
%

$
748,635


$
810,207


$
(61,572
)


(7.6
)%Gross profit(2)

$
168,013


$
133,145


$
34,868



26.2
%

$
133,145


$
109,337


$
23,808



21.8
%Gross profit margin


21.0
%


17.8
%










17.8
%


13.5
%Income (loss) from operations (IFO)(2)(3)

$
68,821


$
36,614


$
32,207



88.0
%

$
36,614


$
(5,548
)

$
42,162



759.9
%IFO margin


8.6
%


4.9
%










4.9
%


(0.7
)%Earnings (loss) before interest and income taxes
    (EBIT)(1)(2)(3)(4)

$
126,839


$
40,667


$
86,172



211.9
%

$
40,667


$
(4,429
)

$
45,096



NMEBIT margin


15.9
%


5.4
%










5.4
%


(0.5
)%Earnings before interest, taxes, depreciation and amortization
    (EBITDA)(1)(2)(3)(4)

$
167,954


$
83,833


$
84,121



100.3
%

$
83,833


$
40,001


$
43,832



109.6
%EBITDA margin


21.0
%


11.2
%










11.2
%


4.9
%Adjusted earnings before interest, taxes, depreciation and
    amortization (Adjusted EBITDA)(1)

$
114,958


$
90,141


$
24,817



27.5
%

$
90,141


$
85,238


$
4,903



5.8
%Adjusted EBITDA margin


14.4
%


12.0
%










12.0
%


10.5
%Net income (loss)(2)(3)(4)(5)

$
70,086


$
(28,788
)

$
98,874



343.5
%

$
(28,788
)

$
(80,463
)

$
51,675



64.2
%Net income (loss) margin


8.8
%


(3.8
)%










(3.8
)%


(9.9
)%Diluted net income (loss) per share

$
3.51


$
(1.90
)

$
5.41



284.7
%

$
(1.90
)

$
(5.48
)

$
3.58



65.3
%     (1)
    
    We believe that EBIT, EBITDA and Adjusted EBITDA, non-GAAP
    financial measures, are useful metrics for evaluating our
    financial performance, as they are measures that we use
    internally to assess our performance. For reconciliation from
    net income (loss) to EBIT, EBITDA and Adjusted EBITDA, see the
    Reconciliation of Non-GAAP Financial Measures
    section below.(2)
    
    2010 includes pre-tax fixed asset write-downs of
    $2.7 million related to after-processing equipment in our
    North American segment, $0.6 million related to the
    write-off of decorating assets at our Shreveport, Louisiana
    facility and $0.9 million in an insurance recovery.
    Includes pre-tax restructuring charges of $2.0 million in
    2009 29




---



##### Table of Contents



related to the closing of our Syracuse China manufacturing
    facility and our Mira Loma distribution center. Also includes
    pre-tax charges of $14.2 million related to the closing of
    our Syracuse China manufacturing facility and our Mira Loma
    distribution center and a pre-tax write-down of
    $4.5 million for certain fixed assets in our North American
    Glass segment that had become idled and were no longer being
    used in 2008. (See note 7 to the Consolidated Financial
    Statements).(3)
    
    In addition to item (2) above, includes a $1.0 million
    charge related to fees for the secondary stock offering,
    $0.7 million related to the write-off of decorating assets
    at our Shreveport, Louisiana facility and $1.1 million
    related to the closing of our Syracuse China manufacturing
    facility and our Mira Loma distribution center in 2010, pre-tax
    restructuring charges $1.6 million related to the closing
    of our Syracuse China manufacturing facility and our Mira Loma
    distribution center and $3.2 million related to pension
    settlement charges in 2009. Also includes pre-tax charges of
    $11.9 million for impairment of goodwill related to our
    Royal Leerdam and Crisal operations and $14.5 million
    related to closing of our Syracuse China manufacturing facility
    and our Mira Loma distribution center in 2008 (See notes 4,
    5, 6 and 7 to the Condensed Consolidated Financial Statements).(4)
    
    In addition to item (3) above, includes pre-tax income of
    $58.3 million in 2010 related to the gain on redemption of
    the New PIK Notes and pre-tax restructuring charges of
    $0.1 million in 2010, $0.2 million in 2009 and
    $0.4 million in 2008 related to the closing of our Syracuse
    China manufacturing facility and our Mira Loma distribution
    center. (See notes 6 and 7 to the Condensed Consolidated
    Financial Statements).(5)
    
    In addition to item (4) above, includes a pre-tax charge of
    $2.7 million in 2010 related to finance fees incurred in
    connection with the exchange of the Old PIK Notes. (See
    note 6 to the Condensed Consolidated Financial Statements).  Discussion
    of 2010 vs. 2009 Results of Operations
  Net
    Sales
  ®
  Gross
    Profit
  last-in
 30




---



##### Table of Contents



Income
    (loss) from operations
    Earnings
    (loss) before interest and income taxes (EBIT)
    Earnings
    before interest, taxes, depreciation and amortization
    (EBITDA)
    Adjusted
    earnings before interest, taxes, depreciation and amortization
    (Adjusted EBITDA)
    Net
    income (loss) and diluted net income (loss) per
    share
   31




---



##### Table of Contents



Discussion
    of 2009 vs. 2008 Results of Operations
  Net
    Sales
  ®
  Gross
    Profit
    Income
    (loss) from operations
   32




---



##### Table of Contents



Earnings
    (loss) before interest and income taxes (EBIT)
    Earnings
    before interest, taxes, depreciation and amortization
    (EBITDA)
    Adjusted
    Earnings before interest, taxes, depreciation and amortization
    (Adjusted EBITDA)
    Net
    loss and diluted loss per share
   33




---



##### Table of Contents



SEGMENT
    RESULTS OF OPERATIONS
    
    North American Glass-includes sales of glass tableware from
    subsidiaries throughout the United States, Canada and Mexico.
    North American Other-includes sales of ceramic dinnerware; metal
    tableware, hollowware and serveware; and plastic items from
    subsidiaries in the United States.
    International-includes worldwide sales of glass tableware from
    subsidiaries outside the United States, Canada and Mexico.  Variance








VarianceIn


In








In


InYear End December 31,

2010


2009


Dollars


Percent


2009


2008


Dollars


Percent(Amounts in thousands, except percentages and per-share
    amounts)Net Sales:North American Glass

$
562,653


$
522,575


$
40,078



7.7
%

$
522,575


$
554,128


$
(31,553
)


(5.7
)%North American Other


85,996



87,041



(1,045
)


(1.2
)%


87,041



111,029



(23,988
)


(21.6
)%International


162,685



145,023



17,662



12.2
%


145,023



153,532



(8,509
)


(5.5
)%Eliminations


(11,540
)


(6,004
)










(6,004
)


(8,482
)Consolidated

$
799,794


$
748,635


$
51,159



6.8
%

$
748,635


$
810,207


$
(61,572
)


(7.6
)%Earnings (loss) before interest and taxes (EBIT):North American Glass

$
109,069


$
33,727


$
75,342



223.4
%

$
33,727


$
25,495


$
8,232



32.3
%North American Other


13,916



9,802



4,114



42.0
%


9,802



(17,696
)


27,498



155.4
%International


3,854



(2,862
)


6,716



234.7
%


(2,862
)


(12,228
)


9,366



76.6
%Consolidated

$
126,839


$
40,667


$
86,172



211.9
%

$
40,667


$
(4,429
)

$
45,096



NMEBIT Margin:North American Glass


19.4
%


6.5
%










6.5
%


4.6
%North American Other


16.2
%


11.3
%










11.3
%


(15.9
)%International


2.4
%


(2.0
)%










(2.0
)%


(8.0
)%Consolidated


15.9
%


5.4
%










5.4
%


(0.5
)%Special items (income) expense (excluding write-off of
    financing fees in 2009):North American Glass

$
(54,151
)

$
3,204


$
(57,355
)


NM


$
3,204


$
5,356


$
(2,152
)


40.2
%North American Other


1,155



3,809



(2,654
)


69.7
%


3,809



28,252



(24,443
)


86.5
%International














NM







11,890



(11,890
)


100.0
%Consolidated

$
(52,996
)

$
7,013


$
(60,009
)


NM


$
7,013


$
45,498


$
(38,485
)


84.6
%      Discussion
    of 2010 vs. 2009 Segment Results of Operations
  North
    American Glass
   34




---



##### Table of Contents



North
    American Other
      International
     35




---



##### Table of Contents



Discussion
    of 2009 vs. 2008 Segment Results of Operations
  North
    American Glass
      North
    American Other
      International
   36




---



##### Table of Contents



CAPITAL
    RESOURCES AND LIQUIDITY
          Balance
    Sheet and Cash flows
  Cash and
    Equivalents
   37




---



##### Table of Contents



Working
    Capital
    VarianceDecember 31,

2010


2009


In Dollars


In Percent(Amounts in thousands, except percentages, DSO, DIO, DPO and
    DWC)Accounts receivable  net

$
92,101


$
82,424


$
9,677



11.7
%DSO(1)


42.0



40.2Inventories  net

$
148,146


$
144,015


$
4,131



2.9
%DIO(2)


67.6



70.2Accounts payable

$
59,095


$
55,539


$
3,556



6.4
%DPO(3)


27.0



27.1Working capital(4)

$
181,152


$
170,900


$
10,252



6.0
%DWC(5)


82.6



83.3Percentage of net sales


22.6
%


22.8
%   365-day
  (1)
    
    Days sales outstanding (DSO) measures the number of days it
    takes to turn receivables into cash.(2)
    
    Days inventory outstanding (DIO) measures the number of days it
    takes to turn inventory into cash.(3)
    
    Days payable outstanding (DPO) measures the number of days it
    takes to pay the balances of our accounts payable.(4)
    
    Working capital is defined as net accounts receivable plus net
    inventories less accounts payable. See Reconciliation of
    Non-GAAP Financial Measures below for the calculation
    of this non-GAAP financial measure and for further discussion as
    to the reasons we believe this non-GAAP financial measure is
    useful.(5)
    
    Days working capital (DWC) measures the number of days it takes
    to turn our working capital into cash.    Borrowings
    
    the entry into an amended and restated credit agreement with
    respect to our ABL Facility;
    the issuance of $400.0 million in aggregate principal
    amount of 10.0 percent Senior Secured Notes of Libbey Glass
    due 2015;
    the repurchase and cancellation of all of Libbey Glasss
    then outstanding $306.0 million in aggregate principal
    amount of floating rate notes; and
    the redemption of all of Libbey Glasss then outstanding
    $80.4 million in aggregate principal amount
    16.0 percent New PIK Notes. 38




---



##### Table of Contents



Interest




December 31,


December 31,Rate


Maturity Date

2010


2009(Dollars in thousands)Borrowings under ABL facility


floating


April 8, 2014

$



$
Senior Secured Notes


10.00
%(1)

February 15, 2015


400,000



Floating rate notes












306,000PIK notes(2)












80,431Promissory note


6.00
%

January, 2011 to September, 2016


1,307



1,492Notes payable


floating


January, 2011






672RMB loan contract


floating


July, 2012 to January, 2014


37,925



36,675RMB working capital loan


floating


January, 2011






7,335BES Euro line


floating


December, 2011 to December, 2013


10,934



14,190Total borrowings








450,166



446,795Less  unamortized discount








6,307



1,749Plus  Carrying value adjustment on debt related to
    the Interest Rate Agreement(1)








3,266



Plus  Carrying value in excess of principal on New
    PIK Notes(2)












70,193Total borrowings  net(3)(4)







$
447,125


$
515,239     (1)
    
    See Derivatives below and note 13 to the
    Consolidated Financial Statements.(2)
    
    On October 28, 2009, we exchanged approximately
    $160.9 million of Old PIK Notes for approximately
    $80.4 million of New PIK Notes and additional common stock
    and warrants to purchase common stock of Libbey Inc. Under U.S.
    GAAP, we were required to record the New PIK Notes at their
    carrying value of approximately $150.6 million instead of
    their face value of $80.4 million. During the first quarter
    of 2010, we redeemed the New PIK Notes in conjunction with the
    refinancing of the senior floating rate notes and recognized a
    $71.1 million gain in gain on redemption of debt on the
    Consolidated Statements of Operations.(3)
    
    Total borrowings  net includes notes payable,
    long-term debt due within one year and long-term debt as stated
    in our Consolidated Balance Sheets.(4)
    
    See Contractual Obligations below for scheduled
    payments by period.   39




---



##### Table of Contents



Cash
    Flow
    Variance








VarianceYear Ended December 31,

2010


2009


In Dollars


In Percent


2009


2008


In Dollars


In Percent(Dollars in thousands, except percentages)Net cash provided by (used in) operating activities

$
47,699


$
102,148


$
(54,449
)


(53.3
)%

$
102,148


$
(1,040
)

$
103,188



NMCapital expenditures


(28,247
)


(17,005
)


11,242



66.1
%


(17,005
)


(45,717
)


(28,712
)


(62.8
)%Payment of interest on New PIK Notes


29,400







(29,400
)


NM















NMProceeds from asset sales and other






265



(265
)


(100.0
)%


265



117



148



126.5
%Free Cash Flow(1)

$
48,852


$
85,408


$
(36,556
)


(42.8
)%

$
85,408


$
(46,640
)

$
132,048



283.1
%       (1)
    
    We believe that Free Cash Flow (which we define as net cash
    provided by (used in) operating activities, less capital
    expenditures, plus payment of interest on New PIK Notes and
    proceeds from asset sales and other) is a useful metric for
    evaluating our financial performance, as it is a measure we use
    internally to assess performance. See Reconciliation of
    Non-GAAP Financial Measures below for a
    reconciliation of net cash provided by (used in) operating
    activities to Free Cash Flow and a further discussion as to the
    reasons we believe this non-GAAP financial measure is useful.  Discussion
    of 2010 vs. 2009 Cash Flow
       40




---



##### Table of Contents



Discussion
    of 2009 vs. 2008 Cash Flow
          Derivatives
       41




---



##### Table of Contents



Derivatives and Hedging
    Share
    Repurchase Program
      Contractual
    Obligations
    Payments Due by PeriodLess than








More thanContractual Obligations(1)

Total


1 Year


1 - 3 Years


3 - 5 Years


5 Years(Dollars in thousands)Borrowings

$
450,166


$
3,142


$
37,295


$
409,556


$
173Interest payments(2)


186,392



42,554



83,760



60,075



3Long-term operating leases


108,010



16,687



26,396



19,173



45,754Pension and nonpension(3)


31,648



31,648











Long-term incentive plans


3,560







3,560







Total obligations

$
779,776


$
94,031


$
151,011


$
488,804


$
45,930     (1)
    
    Amounts reported in local currencies have been translated at
    2010 exchange rates.(2)
    
    The obligations for interest payments are based on
    December 31, 2010 debt levels and interest rates.(3)
    
    It is difficult to estimate future cash contributions as they
    are a function of actual investment returns, withdrawals from
    the plan, changes in interest rates, and other factors uncertain
    at this time.   42




---



##### Table of Contents



Reconciliation
    of Non-GAAP Financial Measures
    Reconciliation
    of net income (loss) to EBIT, EBITDA and Adjusted
    EBITDA
  Year Ended December 31,

2010


2009


2008(Dollars in thousands)Net income (loss)

$
70,086


$
(28,788
)

$
(80,463
)Add: Interest expense


45,171



66,705



69,720Add: Provision for income taxes


11,582



2,750



6,314Earnings (loss) before interest and income taxes (EBIT)


126,839



40,667



(4,429
)Add: Depreciation and amortization


41,115



43,166



44,430Earnings before interest, taxes, deprecation and amortization
    (EBITDA)


167,954



83,833



40,001Add: Special items before interest and taxesGain on redemption of debt (see note 6)(6)


(58,292
)






Pension settlement charges (see note 9)(4)






3,190



Facility closure charges (see note 7)(1)


1,183



3,823



29,127Fixed asset write-down (see note 7)(2)


2,696







4,481Write-off of Shreveport decorating assets (see note 7)


1,315







Expenses of secondary stock offering (see note 6)(5)


1,047







Insurance claim recovery


(945
)






Goodwill and intangible impairment charges (see notes 4
    and 7)(3)










11,890Less: Depreciation expense included in special charges and also
    in depreciation and amortization above






(705
)


(261
)Adjusted earnings before interest, taxes, deprecation and
    amortization (Adjusted EBITDA)

$
114,958


$
90,141


$
85,238     (1)
    
    Facility closure charges are related to the closure of our
    Syracuse, New York ceramic dinnerware manufacturing facility and
    our Mira Loma, California distribution center.(2)
    
    Fixed asset impairment charges are related to unutilized fixed
    assets at our North American Glass segment.(3)
    
    Goodwill and intangible asset impairment charges are related to
    goodwill and intangible assets at our Crisal and Royal Leerdam
    locations.(4)
    
    Pension settlement charges were triggered by excess lump sum
    distributions taken by employees.(5)
    
    Equity offering and finance fees are related to the secondary
    stock offering completed in August, 2010, for which the company
    received no proceeds. 43




---



##### Table of Contents



(6)
    
    Gain on redemption of debt relates to the net gain recorded upon
    redeeming $80.4 million of New PIK notes, repurchasing
    $306.0 million of floating rate notes and writing off bank
    fees, discounts and a call premium on the floating rate notes.                  
    Adjusted EBITDA does not reflect our cash expenditures or future
    requirements for capital expenditures or contractual commitments;
    Adjusted EBITDA does not reflect changes in, or cash
    requirements for, our working capital needs;
    Adjusted EBITDA does not reflect the significant interest
    expense, or the cash requirements necessary to service interest
    or principal payments, on our debts;
    although depreciation and amortization are non-cash charges, the
    assets being depreciated and amortized will often have to be
    replaced in the future, and Adjusted EBITDA does not reflect any
    cash requirements for such replacements;
    Adjusted EBITDA does not reflect the impact of certain cash
    charges resulting from matters we consider not to be indicative
    of our ongoing operations; and
    other companies in our industry may calculate Adjusted EBITDA
    differently than we do, limiting its usefulness as a comparative
    measure. 44




---



##### Table of Contents



Reconciliation
    of net cash provided by (used in) operating activities to Free
    Cash Flow
  Year Ended December 31,

2010


2009


2008(Dollars in thousands)Net cash provided by (used in) operating activities

$
47,699


$
102,148


$
(1,040
)Less: Capital expenditures


(28,247
)


(17,005
)


(45,717
)Plus: Payment of interest on New PIK Notes


29,400







Plus: Proceeds from asset sales and other






265



117Free Cash Flow

$
48,852


$
85,408


$
(46,640
)         Reconciliation
    of Working Capital
  December 31,

2010


2009(Dollars in thousands)Accounts receivable -net

$
92,101


$
82,424Plus: Inventories -net


148,146



144,015Less: Accounts payable


59,095



55,539Working Capital

$
181,152


$
170,900         CRITICAL
    ACCOUNTING ESTIMATES
   45




---



##### Table of Contents



Revenue
    Recognition
    Allowance
    for Doubtful Accounts
    Allowance
    for Slow-Moving and Obsolete Inventory
    Asset
    Impairment
  Fixed
    Assets
     46




---



##### Table of Contents



Goodwill
    and Indefinite Life Intangible Assets
       47




---



##### Table of Contents



Self-Insurance
    Reserves
      Pension
    Assumptions
    U.S. Plans

Non-U.S. Plans2010

2009

2010

2009Discount rate


5.50% to 5.76%



5.62% to 5.96%



5.40% to 8.25%



5.50% to 8.50%Rate of compensation increase


2.25% to 4.50%



2.25% to 4.50%



2.00% to 4.30%



2.00% to 4.30%     U.S. Plans

Non-U.S. Plans2010

2009

2008

2010

2009

2008Discount rate


5.62% to 5.96%



6.41% to 6.48%



6.16% to 6.32%



5.50% to 8.50%



5.70% to 8.50%



5.50% to 8.50%Expected long-term rate of return on plan assets


8.00%



8.25%



8.50%



5.75%



6.00%



6.50%Rate of compensation increase


2.25% to 4.50%



2.63% to 5.25%



3.00% to 6.00%



2.00% to 4.30%



2.00% to 4.30%



2.00% to 4.30%  48




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##### Table of Contents




    A change of 1.0 percent in the discount rate would change
    our total pension expense by approximately $4.0 million.
    A change of 1.0 percent in the expected long-term rate of
    return on plan assets would change total pension expense by
    approximately $2.4 million.  Nonpension
    Postretirement Assumptions
    U.S. Plans

Non-U.S. Plans2010

2009

2010

2009Discount rate


5.34%



5.54%



4.86%



5.42%     U.S. Plans


Non-U.S. Plans2010


2009


2008


2010


2009


2008Discount rate


5.54
%


6.36
%


6.16
%


5.42
%


5.89
%


5.14
%     U.S. Plans

Non-U.S. Plans2010

2009

2010

2009Initial health care trend


7.50
%


8.00
%


7.50
%


8.00
%Ultimate health care trend


5.00
%


5.00
%


5.00
%


5.00
%Years to reach ultimate trend rate


10



6



10



6     
    A change of 1.0 percent in the discount rate would change
    the nonpension postretirement expense by $0.5 million.
    A change of 1.0 percent in the health care trend rate would
    not have a material impact upon the nonpension postretirement
    expense. 49




---



##### Table of Contents



Income
    Taxes
      Derivatives
    and Hedging
      Stock-Based
    Compensation Expense
  ASC 505-50, ASC 050-50
   50




---



##### Table of Contents



Restructuring
    Legal and
    other contingencies
    New
    Accounting Standards
  tm
     51




---



##### Table of Contents



ASC 350-30,
  ASC 815-40,
    ASC 715-20,
  2010-09 
  2009-5 2009-5.) 2009-5 2009-5 2009-5
  2010-06 2010-06). 2010-06 2010-06 2010-06 2010-06
 52




---



##### Table of Contents



2010-13 2010-13). 2010-13
  2010-20 2010-20). No. 2011-01.
  2010-28 2010-28). 2010-28
  2010-29 2010-29). 2010-29 2010-29
  ITEM 7A.
    QUALITATIVE
    AND QUANTITATIVE DISCLOSURES ABOUT MARKET RISK  Currency
    Interest
    Rates
   53




---



##### Table of Contents



Natural
    Gas
    Retirement
    Plans
    
    A change of 1.0 percent in the discount rate would change
    our total pension and nonpension postretirement expense by
    approximately $4.5 million.
    A change of 1.0 percent in the expected long-term rate of
    return on plan assets would change total pension expense by
    approximately $2.4 million. 54




---



##### 



ITEM 8.
    FINANCIAL
    STATEMENTS AND SUPPLEMENTARY DATA   
 PageReports of Independent Registered Public
    Accounting Firm


56Consolidated Balance Sheets at December 31,
    2010 and 2009


58For the years ended December 31, 2010, 2009 and 2008:Consolidated Statements of Operations


59Consolidated Statements of Shareholders
    Equity (Deficit)


60Consolidated Statements of Cash Flows


61Notes to Consolidated Financial Statements:


62Note 1 Description of the Business


62Note 2 Significant Accounting Policies


62Note 3 Balance Sheet Details


68Note 4 Purchased Intangible Assets and
    Goodwill


69Note 5 Property, Plant and Equipment


71Note 6 Borrowings


72Note 7 Special Charges


79Note 8 Income Taxes


83Note 9 Pension


87Note 10 Nonpension Postretirement
    Benefits


93Note 11 Net Income per Share of Common
    Stock


96Note 12 Employee Stock Benefit Plans


96Note 13 Derivatives


103Note 14 Comprehensive Income (Loss)


107Note 15 Fair Value


107Note 16 Operating Leases


108Note 17 Segments


108Note 18 Condensed Consolidated Guarantor
    Financial Statements


111Selected Quarterly Financial Data (unaudited)


120   55




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm            
    56




---



##### Table of Contents



Report of
    Independent Registered Public Accounting Firm
                
    57




---



##### Table of Contents



Libbey
    Inc.
  Consolidated
    Balance Sheets
  December 31,

Footnote Reference


2010


2009(Dollars in thousands, except per-share amounts)ASSETSCurrent assets:Cash & cash equivalents





$
76,258


$
55,089Accounts receivable  net


(note 3
)


92,101



82,424Inventories  net


(note 3
)


148,146



144,015Prepaid and other current assets


(notes 3 & 8
)


6,437



8,484Total current assets






322,942



290,012Other assets:Pension asset


(note 9
)


12,767



9,454Purchased intangible assets  net


(notes 4 & 7
)


23,134



24,861Goodwill


(notes 4 & 7
)


169,340



168,320Derivative asset


(notes 13 & 15
)


2,589



Other assets


(notes 3, 13 & 15
)


17,802



8,854Total other assets






225,632



211,489Property, plant, and equipment  net


(notes 5 & 7
)


270,397



290,013Total assets





$
818,971


$
791,514LIABILITIES AND SHAREHOLDERS EQUITY (DEFICIT)Current liabilities:Notes payable


(note 6
)

$



$
672Accounts payable






59,095



55,539Salaries and wages






32,087



34,064Accrued liabilities


(note 3
)


51,211



35,699Accrued special charges


(note 7
)


768



1,016Accrued income taxes


(note 8
)


3,121



Pension liability (current portion)


(note 9
)


2,330



1,984Nonpension postretirement benefits (current portion)


(note 10
)


5,017



4,363Derivative liability


(notes 13 & 15
)


3,392



3,346Deferred income taxes


(note 8
)






3,559Long-term debt due within one year


(note 6
)


3,142



9,843Total current liabilities






160,163



150,085Long-term debt


(note 6
)


443,983



504,724Pension liability


(note 9
)


115,521



119,727Nonpension postretirement benefits


(note 10
)


67,737



64,780Deferred income taxes


(note 8
)


8,376



6,226Derivative liability


(notes 13 & 15
)






2,061Other long-term liabilities


(notes 3, 13 & 15
)


11,925



10,818Total liabilities






807,705



858,421Shareholders equity (deficit):Common stock, par value $.01 per share, 50,000,000 shares
    authorized, 19,682,506 shares issued in
    2010(18,697,630 shares issued in 2009)






197



187Capital in excess of par value (includes warrants of $1,034 and
    $15,560 in 2010 and 2009, respectively, and 485,309 shares
    and 3,952,165 shares in 2010 and 2009, respectively)






300,692



324,272Treasury stock, at cost, 0 shares in 2010
    (2,599,769 shares in 2009)










(70,298
)Retained deficit






(178,677
)


(205,344
)Accumulated other comprehensive loss


(note 14
)


(110,946
)


(115,724
)Total shareholders equity (deficit)






11,266



(66,907
)Total liabilities and shareholders equity (deficit)





$
818,971


$
791,514    58




---



##### Table of Contents



Libbey
    Inc.
  Consolidated Statements of
    Operations
  Year Ended December 31,

Footnote Reference


2010


2009


2008(Dollars in thousands, except per-share amounts)Net sales


(note 2
)

$
799,794


$
748,635


$
810,207Freight billed to customers






1,790



1,605



2,422Total revenues






801,584



750,240



812,629Cost of sales


(notes 2 & 7
)


633,571



617,095



703,292Gross profit






168,013



133,145



109,337Selling, general and administrative expenses


(note 7
)


97,390



94,900



88,451Impairment of goodwill


(note 7
)










9,434Special charges


(note 7
)


1,802



1,631



17,000Income (loss) from operations






68,821



36,614



(5,548
)Gain on redemption of debt


(note 6
)


58,292







Other (expense) income


(note 7
)


(274
)


4,053



1,119Earnings (loss) before interest and income taxes






126,839



40,667



(4,429
)Interest expense


(note 6
)


45,171



66,705



69,720Income (loss) before income taxes






81,668



(26,038
)


(74,149
)Provision for income taxes


(note 8
)


11,582



2,750



6,314Net income (loss)





$
70,086


$
(28,788
)

$
(80,463
)Net income (loss) per share:Basic


(note 11
)

$
3.97


$
(1.90
)

$
(5.48
)Diluted


(note 11
)

$
3.51


$
(1.90
)

$
(5.48
)Weighted average shares:Outstanding


(note 11
)


17,668



15,149



14,672Diluted


(note 11
)


19,957



15,149



14,672    59




---



##### Table of Contents



Libbey
    Inc.
  Consolidated Statements of Shareholders
    Equity (Deficit)
  AccumulatedOtherCommon


Capital in


Treasury





ComprehensiveStock


Excess of


Stock


Retained


LossAmount(1)


Par Value


Amount(1)


Deficit


(note 14)


Total(Dollars in thousands, except per-share amounts)Balance December 31, 2007

$
187


$
306,874


$
(110,780
)

$
(60,689
)

$
(42,477
)

$
93,115Comprehensive loss:Net loss














(80,463
)






(80,463
)Effect of derivatives  net of tax


















(10,300
)


(10,300
)Pension and other postretirement benefit adjustments 
    net of tax (notes 9 and 10)


















(58,607
)


(58,607
)Effect of exchange rate fluctuation


















(4,402
)


(4,402
)Total comprehensive loss (note 14)






















(153,772
)Stock compensation expense (note 12)






3,466















3,466Stock issued from treasury






(1,065
)


4,369



(2,536
)






768Dividends  $0.10 per share














(1,466
)






(1,466
)Balance December 31, 2008


187



309,275



(106,411
)


(145,154
)


(115,786
)


(57,889
)Comprehensive loss:Net loss














(28,788
)






(28,788
)Effect of derivatives  net of tax


















12,440



12,440Pension and other postretirement benefit adjustments 
    net of tax (notes 9 and 10)


















(13,479
)


(13,479
)Effect of exchange rate fluctuation


















1,101



1,101Total comprehensive loss (note 14)






















(28,726
)Stock compensation expense (note 12)






2,419















2,419Equity issuance costs (note 6)






(1,800
)














(1,800
)Stock issued from treasury






(148
)


36,113



(31,402
)






4,563Issuance of warrants (note 6)






14,526















14,526Balance December 31, 2009

$
187



324,272



(70,298
)


(205,344
)


(115,724
)


(66,907
)Comprehensive income:Net income














70,086







70,086Effect of derivative- net of tax


















3,049



3,049Pension and other postretirement benefit
    adjustments  net of tax (notes 9 and 10)


















9,722



9,722Effect of exchange rate fluctuation


















(7,993
)


(7,993
)Total comprehensive income (note 14)






















74,864Stock compensation expense (note 12)






3,496















3,496Equity issuance costs (note 6)






145















145Stock issued from treasury






(1,495
)


2,302



(1,262
)






(455
)Exercise of stock options (note 12)






88















88Exercise of warrants (note 6)


10



(25,814
)


67,996



(42,157
)






35Balance December 31, 2010

$
197


$
300,692


$



$
(178,677
)

$
(110,946
)

$
11,266     (1)
    
    Share amounts are as follows:  Common Stock


TreasuryShares


Stock Shares


TotalBalance December 31, 2007


18,697,630



4,133,074



14,564,556Stock issued from treasury






(165,588
)


165,588Balance December 31, 2008


18,697,630



3,967,486



14,730,144Stock issued from treasury






(1,367,717
)(1)


1,367,717Balance December 31, 2009


18,697,630



2,599,769



16,097,861Stock issued from treasury






(2,599,769
)(1)


2,599,769Stock options and warrants exercised


984,876




(1)


984,876Balance December 31, 2010


19,682,506







19,682,506     (1)
    
    0.9 million shares and 3.5 million shares were issued
    to the holder of PIK Notes in 2009 and 2010, respectively. See
    note 6 for details.   60




---



##### Table of Contents



Libbey
    Inc.
  Consolidated
    Statements of Cash Flows
  Year Ended December 31,

Footnote Reference


2010


2009


2008(Dollars in thousands)Operating activities:Net income (loss)





$
70,086


$
(28,788
)

$
(80,463
)Adjustments to reconcile net income (loss) to net cash provided
    by (used in) operating activities:Depreciation and amortization


(notes 4 & 5
)


41,115



43,166



44,430Loss on sale of assets






343



323



101Change in accounts receivable






(11,210
)


(6,430
)


16,518Change in inventories






(6,654
)


40,834



(2,027
)Change in accounts payable






4,955



3,828



(21,106
)Accrual of interest on Old PIK notes


(note 6
)






11,916



21,249Income taxes


(note 8
)


1,801



(93
)


9,275Special charges


(note 7
)


3,507



(1,728
)


46,326Change in Vitro payable


(note 4
)










(19,575
)Gain on redemption of New PIK notes


(note 6
)


(71,693
)






Payment of interest on New PIK notes


(note 6
)


(29,400
)






Call premium payment on floating rate notes


(note 6
)


8,415







Write-off of bank fees & discounts on old ABL and
    floating rate notes


(note 6
)


4,986







Pension and postretirement


(notes 9 & 10
)


5,200



5,331



(18,604
)Accrued interest and amortization of discounts, warrants and
    financing fees






17,391



12,945



4,165Accrued liabilities and prepaid expenses






3,344



14,920



(4,988
)Stock option expense






3,496



2,438



3,558Other operating activities






2,017



3,486



101Net cash provided by (used in) operating activities






47,699



102,148



(1,040
)Investing activities:Additions to property, plant and equipment






(28,247
)


(17,005
)


(45,717
)Call premium on floating rate notes


(note 6
)


(8,415
)






Proceeds from asset sales and other










265



117Net cash used in investing activities






(36,662
)


(16,740
)


(45,600
)Financing activities:Net borrowings/(repayments) on ABL credit facility


(note 6
)






(34,169
)


28,693Other repayments


(note 6
)


(10,610
)


(5,225
)


(1,399
)Other borrowings


(note 6
)


215







Floating rate notes payments


(note 6
)


(306,000
)






New PIK note payment


(note 6
)


(51,031
)






Proceeds from senior notes


(note 6
)


392,328







Debt issuance costs and other


(note 6
)


(14,199
)


(4,171
)


Dividends paid














(1,466
)Net cash provided by (used in) financing activities






10,703



(43,565
)


25,828Effect of exchange rate fluctuations on cash






(571
)


(58
)


(2,423
)Increase (decrease) in cash






21,169



41,785



(23,235
)Cash & equivalents at beginning of year






55,089



13,304



36,539Cash & equivalents at end of year





$
76,258


$
55,089


$
13,304Supplemental disclosure of cash flows information:Cash paid during the year for interest





$
27,822


$
39,221


$
42,888Cash paid (refunded) during the year for income taxes





$
8,830


$
3,133


$
(2,276
)   Supplemental disclosure of non-cash financing activities:
     61




---



##### Table of Contents



LIBBEY
    INC.
  Notes
    to Consolidated Financial Statements
  1.
    Description
    of the Business  business-to-business
  2.
    Significant
    Accounting Policies  Basis of Presentation
  Consolidated Statements of
    Operations and/or
  Revenue Recognition
  Cash and cash equivalents
  Accounts Receivable and Allowance for Doubtful
    Accounts
  Inventory Valuation last-in, first-in,
 62




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Purchased Intangible Assets and
    Goodwill
  Software and/or
  Property, Plant and Equipment
    Self-Insurance Reserves
  Pension and Nonpension Postretirement
    Benefits
  U.S.-based U.S.-based non-U.S. pension
   63




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Income Taxes
    Derivatives
  Foreign Currency Translation non-U.S. subsidiaries
  Stock-Based Compensation Expense 505-50 ASC 505-50), ASC 505-50 ASC 505-50
  Research and Development
  Advertising Costs
 64




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Computation of Income Per Share of Common
    Stock
  Treasury Stock
  Reclassifications
  New
    Accounting Standards
  tm
      ASC 350-30,
 65




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    ASC 815-40,
    ASC 715-20,
  2010-09 
  2009-5 2009-5.) 2009-5 2009-5 2009-5
  2010-06 2010-06). 2010-06 2010-06 2010-06 2010-06
 66




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  2010-13 2010-13). 2010-13
  2010-20 2010-20). No. 2011-01.
  2010-28 2010-28). 2010-28
  2010-29 2010-29). 2010-29 2010-29
 67




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  3.
    Balance
    Sheet Details    December 31,2010


2009(Dollars in thousands)Accounts receivable:Trade receivables

$
90,899


$
81,032Other receivables


1,202



1,392Total accounts receivable, less allowances of $5,518 and $7,457

$
92,101


$
82,424Inventories:Finished goods

$
132,169


$
126,651Work in process


653



1,255Raw materials


4,444



4,408Repair parts


9,496



9,933Operating supplies


1,384



1,768Total inventories, less allowances of $4,658 and $4,528

$
148,146


$
144,015Prepaid and other current assets:Value added tax

$
1,332


$
1,647Other prepaid expenses


4,822



6,362Refundable, deferred and prepaid income taxes


283



475Total prepaid and other current assets

$
6,437


$
8,484Other assets:Deposits

$
904


$
583Finance fees  net of amortization


13,012



4,056Other


3,886



4,215Total other assets

$
17,802


$
8,854Accrued liabilities:Accrued incentives

$
15,060


$
13,790Workers compensation


9,608



8,834Medical liabilities


3,785



2,948Interest


14,416



1,998Commissions payable


904



1,134Other accrued liabilities


7,438



6,995Total accrued liabilities

$
51,211


$
35,699Other long-term liabilities:Deferred liability

$
4,622


$
3,350Other


7,303



7,468Total other long-term liabilities

$
11,925


$
10,818  68




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  4.
    Purchased
    Intangible Assets and Goodwill  Purchased
    Intangibles
    2010


2009(Dollars in thousands)Beginning balance

$
24,861


$
26,121Amortization


(1,333
)


(1,367
)Foreign currency impact


(394
)


107Ending balance

$
23,134


$
24,861     December 31,

2010


2009(Dollars in thousands)Indefinite life intangible assets

$
12,923


$
13,094Definite life intangible assets, net of accumulated amortization
    of $12,123 and $10,988


10,211



11,767Total

$
23,134


$
24,861           2011

2012

2013

2014

2015$
1,197


$
1,080


$
1,080


$
1,080


$
1,079  69




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Goodwill
    2010


2009North


North








North


NorthAmerican


American








American


AmericanGlass


Other


International


Total


Glass


Other


International


Total(Dollars in thousands)Beginning balance:Goodwill

$
154,003


$
19,758


$
9,434


$
183,195


$
152,419


$
19,758


$
9,434


$
181,611Accumulated impairment losses






(5,441
)


(9,434
)


(14,875
)






(5,441
)


(9,434
)


(14,875
)154,003



14,317







168,320



152,419



14,317







166,736Other


1,020











1,020



1,584











1,584Ending balance:Goodwill


155,023



19,758



9,434



184,215



154,003



19,758



9,434



183,195Accumulated impairment losses






(5,441
)


(9,434
)


(14,875
)






(5,441
)


(9,434
)


(14,875
)$
155,023


$
14,317


$



$
169,340


$
154,003


$
14,317


$



$
168,320      70




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  5.
    Property,
    Plant and Equipment    December 31,

2010


2009(Dollars in thousands)Land

$
21,534


$
22,632Buildings


90,666



89,863Machinery and equipment


438,965



438,541Furniture and fixtures


13,774



13,696Software


21,499



20,240Construction in progress


11,609



8,587Gross property, plant and equipment


598,047



593,559Less accumulated depreciation


327,650



303,546Net property, plant and equipment

$
270,397


$
290,013   and/or
       71




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      6.
    Borrowings    
    the entry into an amended and restated credit agreement with
    respect to our ABL Facility;
    the issuance of $400.0 million in aggregate principal
    amount of 10.0 percent Senior Secured Notes of Libbey Glass
    due 2015;
    the repurchase and cancellation of all of Libbey Glasss
    then outstanding $306.0 million in aggregate principal
    amount of floating rate notes; and
    the redemption of all of Libbey Glasss then outstanding
    $80.4 million in aggregate principal amount of
    16.0 percent New PIK Notes.        ASC 470-50, ASC 470-60, ASC 470-60,
 72




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
       73




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Interest




December 31,


December 31,Rate


Maturity Date

2010


2009(Dollars in thousands)Borrowings under ABL facility


Floating


April 8, 2014

$



$
Senior Secured Notes


10.00
%(1)

February 15, 2015


400,000



Floating rate notes












306,000New PIK notes(2)












80,431Promissory note


6.00
%

January, 2011 to September, 2016


1,307



1,492Notes payable


Floating


January, 2011






672RMB loan contract


Floating


July, 2012 to January, 2014


37,925



36,675RMB working capital loan


Floating


January, 2011






7,335BES Euro line


Floating


December, 2011 to December, 2013


10,934



14,190Total borrowings








450,166



446,795Less  unamortized discount








6,307



1,749Plus  carrying value adjustment on debt related to
    the Interest Rate Agreement(1)








3,266



Plus  carrying value in excess of principal on New
    PIK Notes(2)












70,193Total borrowings  net








447,125



515,239Less  long-term debt due within one year and notes
    payable








3,142



10,515Total long-term portion of borrowings  net







$
443,983


$
504,724     (1)
    
    See Interest Rate Protection Agreements below and in
    note 13.(2)
    
    On October 28, 2009, we exchanged approximately
    $160.9 million of Old PIK Notes for approximately
    $80.4 million of New PIK Notes and additional common stock
    and warrants to purchase common stock of Libbey Inc. Under U.S.
    GAAP, we were required to record the New PIK Notes at their
    carrying value of approximately $150.6 million instead of
    their face value of $80.4 million. During 2010, we redeemed
    the New PIK Notes in conjunction with the refinancing discussed
    above and recognized a $71.7 million gain in gain on
    redemption of debt on the Consolidated Statements of Operations.    2011


2012


2013


2014


2015


Thereafter$
3,142


$
14,491


$
22,804


$
9,329


$
400,227


$
173   Amended
    and Restated ABL Credit Agreement
   74




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      
    a first-priority security interest in substantially all of the
    existing and future real and personal property of Libbey Glass
    and its domestic subsidiaries (the Credit Agreement
    Priority Collateral);
    a first-priority security interest in:  
    100 percent of the stock of Libbey Glass and
    100 percent of the stock of substantially all of Libbey
    Glass present and future direct and indirect domestic
    subsidiaries;
    100 percent of the non-voting stock of substantially all of
    Libbey Glass first-tier present and future foreign
    subsidiaries; and
    65 percent of the voting stock of substantially all of
    Libbey Glass first-tier present and future foreign
    subsidiaries  
    a first priority security interest in substantially all proceeds
    and products of the property and assets described above; and
    a second-priority security interest in substantially all of the
    owned real property, equipment and fixtures in the United States
    of Libbey Glass and its domestic subsidiaries, subject to
    certain exceptions and permitted liens (the New Notes
    Priority Collateral).    
    a first-priority lien on substantially all of the existing and
    future real and personal property of Libbey Europe and its Dutch
    subsidiaries; and
    a first-priority security interest in:  
    100 percent of the stock of Libbey Europe and
    100 percent of the stock of substantially all of the Dutch
    subsidiaries; and
    100 percent (or a lesser percentage in certain
    circumstances) of the outstanding stock issued by the first tier
    foreign subsidiaries of Libbey Europe and its Dutch subsidiaries.     75




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  mark-to-market
  Senior
    Secured Notes
      
    incur or guarantee additional indebtedness;
    pay dividends, make certain investments or other restricted
    payments;
    create liens;
    enter into affiliate transactions;
    merge or consolidate, or otherwise dispose of all or
    substantially all the assets of Libbey Glass and the
    Guarantors; and
    transfer or sell assets.       76




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        Promissory
    Note
    Notes
    Payable
    RMB
    Loan Contract
  Sub-Branch
 77




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    RMB
    Working Capital Loan
  3-year
  BES
    Euro Line
    Fair
    Value of Borrowings
    Capital
    Resources and Liquidity
       78




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  7.
    Special
    Charges  Facility
    Closures
              work-in-process
   79




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      December 31, 2010


December 31, 2009


December 31, 2008North


North





North


North





North


NorthAmerican


American





American


American





American


AmericanGlass


Other


Total


Glass


Other


Total


Glass


Other


Total(Dollars in thousands)Inventory write-down

$



$
(12
)

$
(12
)

$



$
977


$
977


$
192


$
9,576


$
9,768Pension & postretirement welfare


















278



278







4,170



4,170Fixed asset depreciation


















705



705







261



261Included in cost of sales






(12
)


(12
)






1,960



1,960



192



14,007



14,199Fixed asset write-down and site
    clean-up






1,012



1,012



112



(138
)


(26
)


65



9,660



9,725Employee termination cost & other


28



25



53



(98
)


1,755



1,657



618



4,202



4,820Included in special charges


28



1,037



1,065



14



1,617



1,631



683



13,862



14,545Ineffectiveness of natural gas hedge






130



130







232



232







383



383Included in other expense (income)






130



130







232



232







383



383Total pretax charge

$
28


$
1,155


$
1,183


$
14


$
3,809


$
3,823


$
875


$
28,252


$
29,127     Reserve














ReserveBalances


Total


Cash


Inventory &





Balances atat January 1,


Charge to


(Payments)


Fixed Asset


Non-Cash


December 31,2010


Earnings


Receipts


Write Downs


Utilization


2010(Dollars in thousands)Inventory write-down

$



$
(12
)

$
12


$



$



$
Building site
    clean-up and
    fixed asset write-down


306



1,012



(538
)


(629
)






151Employee termination cost & other


710



53



(462
)










301Ineffectiveness of natural gas hedges






130











(130
)


Total

$
1,016


$
1,183


$
(988
)

$
(629
)

$
(130
)

$
452  80




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Reserve














ReserveBalances


Total


Cash


Inventory &





Balances atat January 1,


Charge to


(Payments)


Fixed Asset


Non-Cash


December 31,2009


Earnings


Receipts


Write Downs


Utilization


2009(Dollars in thousands)Inventory write-down

$



$
977


$
137


$
(1,114
)

$



$
Pension & postretirement welfare






278











(278
)


Fixed asset depreciation






705











(705
)


Building site
    clean-up and
    fixed asset write-down






(26
)


444



(112
)






306Employee termination cost & other


4,248



1,657



(5,683
)






488



710Ineffectiveness of natural gas hedges






232











(232
)


Total

$
4,248


$
3,823


$
(5,102
)

$
(1,226
)

$
(727
)

$
1,016       North


North


TotalAmerican


American


ChargesGlass


Other


To Date(Dollars in thousands)Inventory write-down

$
192


$
10,541


$
10,733Pension & postretirement welfare






4,448



4,448Fixed asset depreciation






966



966Included in cost of sales


192



15,955



16,147Employee termination cost & other


548



5,982



6,530Building site
    clean-up &
    fixed asset write-down


177



10,534



10,711Included in special charges


725



16,516



17,241Ineffectiveness of natural gas hedge






745



745Included in other (expense) income






745



745Total pretax charge to date

$
917


$
33,216


$
34,133   Fixed
    Asset and Inventory Write-down
   81




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      Reserve











ReserveBalances


Total


Cash


Inventory &


Balances atat January 1,


Charge to


(Payments)


Fixed Asset


December 31,2010


Earnings


Receipts


Write Downs


2010(Dollars in thousands)Inventory write-down

$



$
578


$



$
(578
)

$
Building site
    clean-up and
    fixed asset write-down






737



9



(430
)


316Total

$



$
1,315


$
9


$
(1,008
)

$
316         Write-off
    of Finance Fees
    Intangible
    Asset Impairment
   82




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Summary
    of Total Special Charges
    December 31,


December 31,


December 31,2010


2009


2008(Dollars in thousands)Cost of sales

$
3,262


$
1,960


$
18,681Impairment of goodwill










9,434Special charges


1,802



1,631



17,000Other expense (income)


130



232



383Interest expense






2,700



Total special charges

$
5,194


$
6,523


$
45,498   8.
    Income
    Taxes    Year Ended December 31,

2010


2009


2008(Dollars in thousands)United States

$
46,720


$
(25,385
)

$
(79,496
)Non-U.S.


34,948



(653
)


5,347Total earnings (loss) before tax

$
81,668


$
(26,038
)

$
(74,149
)     Year Ended December 31,

2010


2009


2008(Dollars in thousands)Current:U.S. federal

$
(423
)

$
11,436


$
(724
)Non-U.S.


13,459



10,782



2,798U.S. state and local


212



170



181Total current income tax provision


13,248



22,388



2,255Deferred:U.S. federal


94



(16,053
)


1,855Non-U.S.


(1,854
)


(3,570
)


2,204U.S. state and local


94



(15
)


Total deferred income tax (benefit) provision


(1,666
)


(19,638
)


4,059Total:U.S. federal


(329
)


(4,617
)


1,131Non-U.S.


11,605



7,212



5,002U.S. state and local


306



155



181Total income tax provision

$
11,582


$
2,750


$
6,314  83




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    December 31,

2010


2009(Dollars in thousands)Deferred income tax assets:Pension

$
33,007


$
38,558Nonpension postretirement benefits


25,853



24,820Other accrued liabilities


20,426



16,843Receivables


1,496



2,201Cancellation of indebtedness income






27,300Net operating loss carry forwards


15,212



15,969Tax credits


10,056



10,143Total deferred income tax assets


106,050



135,834Deferred income tax liabilities:Property, plant and equipment


22,432



26,248Inventories


7,138



8,210Intangibles and other assets


12,246



12,172Total deferred income tax liabilities


41,816



46,630Net deferred income tax asset before valuation allowance


64,234



89,204Valuation allowance


(72,327
)


(98,989
)Net deferred income tax liability

$
(8,093
)

$
(9,785
)     December 31,

2010


2009(Dollars in thousands)Current deferred income tax asset (liability)

$
283


$
(3,559
)Noncurrent deferred income tax liability


(8,376
)


(6,226
)Net deferred income tax liability

$
(8,093
)

$
(9,785
)       non-U.S. credits. non-U.S. credit
 84




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  non-U.S. credits.
      Year Ended December 31,

2010


2009


2008(Dollars in thousands)Beginning balance

$
98,989


$
87,442


$
28,855(Benefit) charge to provision for income taxes


(22,830
)


8,140



37,247(Benefit) charge to other comprehensive income


(3,832
)


3,407



21,340Ending balance

$
72,327


$
98,989


$
87,442   non-U.S. entities.
    Year Ended December 31,

2010


2009


2008Statutory U.S. federal income tax rate


35.0
%


35.0
%


35.0
%Increase (decrease) in rate due to:Non-U.S.
    income tax differential


(2.8
)


9.9



4.7U.S. state and local income taxes, net of related U.S. federal
    income taxes


0.3



(0.6
)


(0.2
)U.S. federal credits and net operating loss caryforward


0.8







1.0Permanent adjustments


6.9



(14.8
)


(2.6
)Non-U.S.
    federal credits










4.8Valuation allowance


(25.4
)


(31.3
)


(50.3
)Income tax impact pursuant to Crisa acquisition






(12.1
)


Other


(0.6
)


3.3



(0.9
)Consolidated effective income tax rate


14.2
%


(10.6
)%


(8.5
)%  85




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      December 31,

2010


2009(Dollars in thousands)U.S. federal

$
564


$
3,077Non-U.S.


(3,519
)


(2,486
)U.S. state and local


(166
)


(116
)Total current income tax (liability) asset

$
(3,121
)

$
475   non-U.S. non-U.S. non-U.S. non-U.S. non-U.S. operations.
        2010


2009


2008(Dollars in thousands)Beginning balance

$
1,029


$
2,301


$
2,729Additions based on tax positions related to the current year


48



1,180



29Additions for tax positions of prior years










1,567Reductions for tax positions of prior years


(34
)


(229
)


(1,020
)Reductions due to lapse of statute of limitations


86



137



(1,004
)Reductions due to settlements with tax authorities






(2,360
)


Ending balance

$
1,129


$
1,029


$
2,301  86




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        Jurisdiction

Open YearsCanada


2007-2010China


2007-2010Mexico


2005-2010Netherlands


2009-2010Portugal


2006-2010United States


2008-2010   9.
    Pension  U.S.-based U.S.-based U.S.-based non-U.S. pension
  Effect
    on Operations
    U.S. Plans


Non-U.S. Plans


TotalYear Ended December 31,

2010


2009


2008


2010


2009


2008


2010


2009


2008(Dollars in thousands)Service cost (benefits earned during the period)

$
5,341


$
5,050


$
5,388


$
1,603


$
1,354


$
1,669


$
6,944


$
6,404


$
7,057Interest cost on projected benefit obligation


15,896



15,623



15,634



4,557



4,147



4,729



20,453



19,770



20,363Expected return on plan assets


(16,683
)


(17,573
)


(17,567
)


(2,463
)


(2,530
)


(3,265
)


(19,146
)


(20,103
)


(20,832
)Amortization of unrecognized:Prior service cost (credit)


2,328



2,242



2,381



2



(207
)


(212
)


2,330



2,035



2,169Actuarial loss


3,621



960



1,308



417



375



293



4,038



1,335



1,601Transition obligations














122



113



142



122



113



142Curtailment charge










1,070























1,070Settlement charge






3,661







47











47



3,661



Pension expense

$
10,503


$
9,963


$
8,214


$
4,285


$
3,252


$
3,356


$
14,788


$
13,215


$
11,570  87




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      Actuarial
    Assumptions
    U.S. Plans

Non-U.S. Plans2010

2009

2010

2009Discount rate


5.50% to 5.76%



5.62% to 5.96%



5.40% to 8.25%



5.50% to 8.50%Rate of compensation increase


2.25% to 4.50%



2.25% to 4.50%



2.00% to 4.30%



2.00% to 4.30%     U.S. Plans


Non-U.S. Plans2010


2009


2008


2010


2009


2008Discount rate


5.62% to 5.96%



6.41% to 6.48%



6.16% to 6.32%



5.50% to 8.50%



5.70% to 8.50%



5.50% to 8.50%Expected long-term rate of return on plan assets


8.00%



8.25%



8.50%



5.75%



6.00%



6.50%Rate of compensation increase


2.25% to 4.50%



2.63% to 5.25%



3.00% to 6.00%



2.00% to 4.30%



2.00% to 4.30%



2.00% to 4.30%          88




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    EstimatedPercentage

Effect on Annual Expense:Assumption

Point Change

2010

2011(Dollars in thousands)Discount rate


1.0 percent change


$
3,200


$
4,000Long-term rate of return on assets


1.0 percent change


$
2,400


$
2,400   Projected
    Benefit Obligation (PBO) and Fair Value of Assets
    U.S. Plans


Non-U.S. Plans


TotalDecember 31,

2010


2009


2010


2009


2010


2009(Dollars in thousands)Change in projected benefit obligation:Projected benefit obligation, beginning of year

$
278,801


$
256,871


$
69,201


$
60,897


$
348,002


$
317,768Service cost


5,341



5,050



1,603



1,354



6,944



6,404Interest cost


15,896



15,623



4,557



4,147



20,453



19,770Exchange rate fluctuations










(1,334
)


2,833



(1,334
)


2,833Actuarial loss


4,238



27,910



816



1,239



5,054



29,149Plan participants contributions










1,281



1,079



1,281



1,079Settlements






(6,445
)














(6,445
)Benefits paid


(14,551
)


(20,208
)


(2,796
)


(2,348
)


(17,347
)


(22,556
)Projected benefit obligation, end of year

$
289,725


$
278,801


$
73,328


$
69,201


$
363,053


$
348,002Change in fair value of plan assets:Fair value of plan assets, beginning of year

$
185,930


$
170,354


$
49,815


$
45,482


$
235,745


$
215,836Actual return on plan assets


25,590



26,540



3,667



1,944



29,257



28,484Exchange rate fluctuations










(3,764
)


820



(3,764
)


820Employer contributions


9,118



9,244



3,679



2,838



12,797



12,082Plan participants contributions










1,281



1,079



1,281



1,079Benefits paid


(14,551
)


(20,208
)


(2,796
)


(2,348
)


(17,347
)


(22,556
)Fair value of plan assets, end of year

$
206,087


$
185,930


$
51,882


$
49,815


$
257,969


$
235,745Funded ratio


71.1
%


66.7
%


70.8
%


72.0
%


71.1
%


67.7
%Funded status and net accrued pension benefit cost

$
(83,638
)

$
(92,871
)

$
(21,446
)

$
(19,386
)

$
(105,084
)

$
(112,257
)   plan-by-plan
 89




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  :
  U.S. Plans


Non-U.S. Plans


TotalDecember 31,

2010


2009


2010


2009


2010


2009(Dollars in thousands)Net actuarial loss

$
87,357


$
95,648


$
9,097


$
9,215


$
96,454


$
104,863Prior service cost


7,736



10,064



2,005



2,151



9,741



12,215Transition obligation










384



483



384



483Total cost

$
95,093


$
105,712


$
11,486


$
11,849


$
106,579


$
117,561     U.S. Plans


Non-U.S. Plans


Total(Dollars in thousands)Net actuarial loss

$
4,871


$
493


$
5,364Prior service cost


2,163



194



2,357Transition obligation






125



125Total cost

$
7,034


$
812


$
7,846   non-U.S. pension non-U.S. pension
    Year

U.S. Plans


Non-U.S. Plans


Total(Dollars in thousands)2011

$
17,190


$
2,932


$
20,1222012

$
17,790


$
3,000


$
20,7902013

$
18,610


$
3,241


$
21,8512014

$
19,256


$
3,699


$
22,9552015

$
19,949


$
4,479


$
24,4282016-2020

$
106,548


$
27,775


$
134,323  90




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Accumulated
    Benefit Obligation in Excess of Plan Assets
    December 31, 2010

U.S. Plans


Non-U.S. Plans


Total(Dollars in thousands)Projected benefit obligation

$
289,725


$
34,213


$
323,938Accumulated benefit obligation

$
285,551


$
29,632


$
315,183Fair value of plan assets

$
206,087


$



$
206,087   December 31, 2009

U.S. Plans


Non-U.S. Plans


Total(Dollars in thousands)Projected benefit obligation

$
278,801


$
28,839


$
307,640Accumulated benefit obligation

$
274,266


$
22,531


$
296,797Fair value of plan assets

$
185,930


$



$
185,930   Plan
    Asset Allocation
    TargetAllocation


Percentage of Plan Assets at Year EndU.S. Plans Asset Category

2011


2010


2009Equity securities


45
%


49
%


48
%Debt securities


35
%


31
%


34
%Real estate


5
%


5
%


5
%Other


15
%


15
%


13
%Total


100
%


100
%


100
%     TargetAllocation


Percentage of Plan Assets at Year EndNon-U.S. Plan Asset Category

2011


2010


2009Equity securities


22
%


23
%


19
%Debt securities


62
%


61
%


64
%Real estate


11
%


10
%


11
%Other


5
%


6
%


6
%Total


100
%


100
%


100
%    91




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        December 31, 2010

Level One


Level Two


Level Three


Total(Dollars in thousands)Cash & cash equivalents

$



$
3,442


$



$
3,442Real estate






11,088



5,385



16,473Equity securities






111,369







111,369Debt securities






96,081







96,081Hedge funds










30,604



30,604Total

$



$
221,980


$
35,989


$
257,969   December 31, 2009

Level One


Level Two


Level Three


Total(Dollars in thousands)Cash & cash equivalents

$



$
957


$



$
957Real estate






232



5,401



5,633Equity securities






109,290







109,290Debt securities






94,179







94,179Hedge funds










25,686



25,686Total

$



$
204,658


$
31,087


$
235,745     (Dollars in thousands)Beginning balance of assets classified as Level 3 as of
    December 31, 2009

$
31,087Change in unrealized appreciation (depreciation)


2,912Net purchases (sales)


1,990Ending balance of assets classified as Level 3 as of
    December 31, 2010

$
35,989   92




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  (Dollars in thousands)Beginning balance of assets classified as Level 3 as of
    December 31, 2008

$
34,056Change in unrealized appreciation (depreciation)


3,721Net purchases (sales)


(6,690
)Ending balance of assets classified as Level 3 as of
    December 31, 2009

$
31,087   10.
    Nonpension
    Postretirement Benefits  U.S.-based non-U.S. nonpension
  Effect
    on Operations
    U.S. Plans


Non-U.S. Plans


TotalYear Ended December 31,

2010


2009


2008


2010


2009


2008


2010


2009


2008(Dollars in thousands)Service cost (benefits earned during the period)

$
1,360


$
1,333


$
1,099


$
1


$
1


$
1


$
1,361


$
1,334


$
1,100Interest cost on projected benefit obligation


3,617



3,783



2,979



124



112



129



3,741



3,895



3,108Amortization of unrecognized:Prior service cost (credit)


290



(418
)


2,967















290



(418
)


2,967Loss (gain)


1,028



764



239



(29
)


(34
)


(33
)


999



730



206Curtailment credit






(94
)






















(94
)


Nonpension postretirement benefit expense

$
6,295


$
5,368


$
7,284


$
96


$
79


$
97


$
6,391


$
5,447


$
7,381     Actuarial
    Assumptions
    U.S. Plans

Non-U.S. Plans2010

2009

2010

2009Discount rate


5.34
%


5.54
%


4.86
%


5.42
%  93




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    U.S. Plans

Non-U.S. Plans2010

2009

2008

2010

2009

2008Discount rate


5.54
%


6.36
%


6.16
%


5.42
%


5.89
%


5.14
%     U.S. Plans


Non-U.S. Plans2010


2009


2010


2009Initial health care trend


7.50
%


8.00
%


7.50
%


8.00
%Ultimate health care trend


5.00
%


5.00
%


5.00
%


5.00
%Years to reach ultimate trend rate


10



6



10



6         
    A 1.0 percent change in the health care trend rate would
    not have a material impact upon the nonpension postretirement
    expense.
    A 1.0 percent change in the discount rate would change the
    nonpension postretirement expense by $0.5 million.  Accumulated
    Postretirement Benefit Obligation
    U.S. Plans


Non-U.S. Plans


TotalDecember 31,

2010


2009


2010


2009


2010


2009(Dollars in thousands)Change in accumulated nonpension postretirement benefit
    obligation:Benefit obligation, beginning of year

$
66,792


$
59,854


$
2,351


$
2,027


$
69,143


$
61,881Service cost


1,360



1,333



1



1



1,361



1,334Interest cost


3,617



3,783



124



112



3,741



3,895Plan participants contributions


1,365



1,416











1,365



1,416Plan amendments


300















300



Actuarial loss


2,068



4,958



101



76



2,169



5,034Exchange rate fluctuations










120



333



120



333Curtailments






(7
)














(7
)Benefits paid


(5,321
)


(4,545
)


(124
)


(198
)


(5,445
)


(4,743
)Benefit obligation, end of year

$
70,181


$
66,792


$
2,573


$
2,351


$
72,754


$
69,143Funded status and accrued benefit cost

$
(70,181
)

$
(66,792
)

$
(2,573
)

$
(2,351
)

$
(72,754
)

$
(69,143
)  94




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
      U.S. Plans


Non-U.S. Plans


TotalDecember 31,

2010


2009


2010


2009


2010


2009(Dollars in thousands)Net actuarial loss (gain)

$
20,574


$
19,534


$
(456
)

$
(566
)

$
20,118


$
18,968Prior service cost


2,612



2,602











2,612



2,602Total cost (credit)

$
23,186


$
22,136


$
(456
)

$
(566
)

$
22,730


$
21,570     U.S. Plans


Non U.S. Plans


Total(Dollars in thousands)Net actuarial loss (gain)

$
1,160


$
(16
)

$
1,144Prior service cost


422







422Total cost (credit )

$
1,582


$
(16
)

$
1,566     Fiscal Year

U.S. Plans


Non U.S. Plans


Total(Dollars in thousands)2011

$
4,829


$
188


$
5,0172012

$
5,252


$
190


$
5,4422013

$
5,719


$
192


$
5,9112014

$
6,123


$
195


$
6,3182015

$
6,201


$
195


$
6,3962016-2020

$
29,630


$
927


$
30,557      95




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  11.
    Net
    Income per Share of Common Stock    Year Ended December 31,

2010


2009


2008(Dollars in thousands, except per-share amounts)Numerator for earnings per share  net income (loss)
    that is available to common shareholders

$
70,086


$
(28,788
)

$
(80,463
)Denominator for basic earnings per share 
    Weighted-average shares outstanding


17,668,214



15,149,013



14,671,500Effect of stock options, restricted stock units and performance
    shares


501,395







Effect of warrants


1,787,472







Effect of dilutive securities(1)


2,288,867







Denominator for diluted earnings per share  Adjusted
    weighted-average shares and assumed conversions


19,957,081



15,149,013



14,671,500Basic earnings (loss) per share

$
3.97


$
(1.90
)

$
(5.48
)Diluted earnings (loss) per share

$
3.51


$
(1.90
)

$
(5.48
)     (1)
    
    The effect of employee stock options, warrants, restricted stock
    units and performance shares, 733,908 shares for the year
    ended December 31, 2009, were anti-dilutive and thus not
    included in the earnings per share calculation. The effect of
    employee stock options, warrants, restricted stock units,
    performance shares and the employee stock purchase plan, (ESPP),
    237,802 shares for the years ended December 31, 2008
    were anti-dilutive and thus not included in the earnings per
    share calculation. These amounts would have been dilutive if not
    for the net loss.  in-the-money in-the-money
  12.
    Employee
    Stock Benefit Plans    505-50, ASC 505-50
  Equity
    Participation Plan Program Description
   96




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Non-Qualified
    Stock Option and Employee Stock Purchase Plan (ESPP)
    Information
         97




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    2010


2009


2008Stock option grants:Risk-free interest


2.86
%


2.78
%


3.30
%Expected term


6.3 years



6.3 years



6.3 yearsExpected volatility


87.21
%


74.00
%


48.20
%Dividend yield


0.00
%


0.00
%


0.65
%Employee Stock Purchase Plan:Risk-free interest


Not Applicable



Not Applicable



2.18
%Expected term


Not Applicable



Not Applicable



12 monthsExpected volatility


Not Applicable



Not Applicable



57.30
%Dividend yield


Not Applicable



Not Applicable



0.89
%   
    The risk-free interest rate is based on the U.S. Treasury
    yield curve at the time of grant and has a term equal to the
    expected life.
    The expected term represents the period of time the options are
    expected to be outstanding. Additionally, we use historical data
    to estimate option exercises and employee forfeitures. The
    Company uses the Simplified Method defined by the SEC Staff
    Accounting Bulletin No. 107, Share-Based
    Payment (SAB 107), to estimate the expected term of
    the option, representing the period of time that options granted
    are expected to be outstanding.
    The expected volatility was developed based on historic stock
    prices commensurate with the expected term of the option. We use
    projected data for expected volatility of our stock options
    based on the average of daily, weekly and monthly historical
    volatilities of our stock price over the expected term of the
    option and other economic data trended into future years.
    The dividend yield is calculated as the ratio based on our most
    recent historical dividend payments per share of common stock at
    the grant date to the stock price on the date of grant. 98




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     Weighted-AverageWeighted-Average


Remaining


AggregateExercise Price per


Contractual Life


IntrinsicOptions

Shares


Share


(In Years)


Value(Dollars in thousands, except shares and per-share
    amounts)Outstanding balance at January 1, 2008


1,520,296


$
24.67



5


$
1,181Granted


147,976



15.08Exercised






Canceled


(194,295
)


34.98Outstanding balance at December 31, 2008


1,473,977



22.37



5


$
Granted


346,021



1.09Exercised






Canceled


(175,831
)


29.05Outstanding balance at December 31, 2009


1,644,167



17.18



6


$
2,258Granted


220,007



11.10Exercised


(9,279
)


14.50






$
84Canceled


(139,961
)


28.05Outstanding balance at December 31, 2010


1,714,934


$
15.58



6


$
6,710Exercisable at December 31, 2010


1,164,814


$
19.48






$
2,213        99




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Weighted-AverageShares


Value (per Share)Nonvested at January 1, 2008


337,010


$
6.67Granted


147,976


$
7.34Vested


(87,536
)

$
5.54Canceled





$
Nonvested at December 31, 2008


397,450


$
7.17Granted


346,021


$
0.74Vested


(159,221
)

$
5.70Canceled


(10,881
)

$
5.13Nonvested at December 31, 2009


573,369


$
3.74Granted


220,007


$
8.33Vested


(221,065
)

$
5.57Canceled


(22,191
)

$
4.26Nonvested at December 31, 2010


550,120


$
4.81   Performance
    Share Information
   
  3-year
 
 
   
 100




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
    Performance Shares

SharesOutstanding balance at January 1, 2008


113,598Granted


80,368Issued


(14,626
)Canceled


Outstanding balance at December 31, 2008


179,340Granted


8,717Issued


(13,896
)Canceled


(2,300
)Outstanding balance at December 31, 2009


171,861Granted


Issued


(48,035
)Canceled


Outstanding balance at December 31, 2010


123,826    
   
  Stock
    and Restricted Stock Unit Information
   
   
 101




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
 
   
  Restricted Stock Units

SharesOutstanding balance at January 1, 2008


170,158Granted


100,725Awarded


(67,972
)Canceled


(300
)Outstanding balance at December 31, 2008


202,611Granted


260,271Awarded


(170,154
)Canceled


Outstanding balance at December 31, 2009


292,728Granted


226,667Awarded


(111,480
)Canceled


(3,500
)Outstanding balance at December 31, 2010


404,415     Employee
    401(k) Plan Retirement Fund and Non-Qualified Deferred Executive
    Compensation Plans
      catch-up catch-up
 102




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
        13.
    Derivatives    Fair
    Values
    Asset Derivatives:December 31, 2010


December 31, 2009Derivatives Designated as

Balance




BalanceHedging Instruments

Sheet

Fair


Sheet

FairUnder FASB ASC 815:

Location:

Value


Location:

Value(Dollars in thousands)Interest rate contracts

Other assets

$
2,536




$
Natural gas contracts

Other assets


53





Total designated



$
2,589




$
   103




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Liability Derivatives:December 31, 2010


December 31, 2009Derivatives Designated as

Balance




BalanceHedging Instruments

Sheet

Fair


Sheet

FairUnder FASB ASC 815:

Location

Value


Location

Value(Dollars in thousands)Natural gas contracts

Derivative liability

$
3,117


Derivative liability


3,129Natural gas contracts

Other long-term liabilities





Other long-term liabilities


1,982Total designated




3,117





5,111Derivatives undesignated as hedging instruments under FASB
    ASC 815:Natural gas contracts

Derivative liability


124


Derivative liability


217Currency contracts

Derivative liability


151


Derivative liability


Natural gas contracts

Other long-term liabilities





Other long-term liabilities


79Total undesignated




275





296Total



$
3,392




$
5,407   Interest
    Rate Swaps as Fair Value Hedges
    fixed-to-floating
  Amount of Gain (Loss)Year Ended December 31,

Recognized in Other (Expense) IncomeDerivative:

2010


2009


2008(Dollars in thousands)Interest rate swap

$
2,536


$



$
Related long-term debt


(3,266
)






Net impact on other (expense) income

$
(730
)

$



$
   Commodity
    Futures Contracts and Interest Rate Swaps Designated as Cash
    Flow Hedges
   104




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
          Amount of Derivative Gain/(Loss)Recognized in OCI (Effective Portion)Year Ended December 31,

2010


2009


2008(Dollars in thousands)Derivatives in Cash Flow Hedging relationships:Interest rate contracts

$



$
6,322


$
(790
)Natural gas contracts


(8,539
)


(8,976
)


(15,447
)Total

$
(8,539
)

$
(2,654
)

$
(16,237
)   105




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Gain/(Loss) Reclassified fromAccumulated OtherComprehensive Loss toConsolidated Statements ofYear Ended December 31,




Operations (Effective Portion)Derivative:

Location:


2010


2009


2008(Dollars in thousands)Natural gas contracts


Cost of sales


$
(11,139
)

$
(18,269
)

$
(2,431
)Total impact on net income (loss)





$
(11,139
)

$
(18,269
)

$
(2,431
)     Gain (Loss) Recognized in Income (Ineffective PortionYear Ended December 31,



and Amount Excluded from Effectiveness Testing)Derivative:

Location:

2010


2009


2008(Dollars in thousands)Natural gas contracts

Other (expense) income

$
(126
)

$
(155
)

$
(461
)Total



$
(126
)

$
(155
)

$
(461
)   Currency
    Contracts
      Year Ended December 31,Derivative:

Location:

2010


2009


2008(Dollars in thousands)Currency contracts

Other (expense) income

$
(150
)

$



$
(359
)Total



$
(150
)

$



$
(359
)    106




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  14.
    Comprehensive
    Income (Loss)    Year Ended December 31,

2010


2009


2008(Dollars in thousands)Net income (loss)

$
70,086


$
(28,788
)

$
(80,463
)Effect of derivatives, net of tax (below)


3,049



12,440



(10,300
)Minimum pension and non-pension retirement liability and
    intangible pension asset, net of tax (shown below)


9,722



(13,479
)


(58,607
)Effect of exchange rate fluctuation


(7,993
)


1,101



(4,402
)Total comprehensive income (loss)

$
74,864


$
(28,726
)

$
(153,772
)     Minimum PensionEffect of





and Non-Pension


TotalExchange





Retirement Liability


AccumulatedRate


Cash Flow


and Intangible


ComprehensiveFluctuation


Derivatives


Pension Asset


Loss(Dollars in thousands)Balance on December 31, 2007

$
8,633


$
(6,310
)

$
(44,800
)

$
(42,477
)2008 change


(4,402
)


(13,690
)


(55,938
)


(74,030
)Translation effect










(2,387
)


(2,387
)Tax effect






3,390



(282
)


3,108Balance on December 31, 2008


4,231



(16,610
)


(103,407
)


(115,786
)2009 change


1,101



15,613



(12,904
)


3,810Translation effect










(348
)


(348
)Tax effect






(3,173
)


(227
)


(3,400
)Balance on December 31, 2009


5,332



(4,170
)


(116,886
)


(115,724
)2010 change


(7,993
)


2,600



11,453



6,060Translation effect










(1,630
)


(1,630
)Tax effect






449



(101
)


348Balance on December 31, 2010

$
(2,661
)

$
(1,121
)

$
(107,164
)

$
(110,946
)   15.
    Fair
    Value      
    Level 1  Quoted prices in active markets for
    identical assets or liabilities.
    Level 2  Inputs, other than the quoted prices in
    active markets, that are observable either directly or
    indirectly. 107




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
   
    Level 3  Unobservable inputs based on our own
    assumptions.  Fair Value Asset (Liability) at December 31, 2010Level 1


Level 2


Level 3


Total(Dollars in thousands)Commodity futures natural gas contracts

$



$
(3,188
)

$



$
(3,188
)Currency contracts






(151
)






(151
)Interest rate agreement






2,536







2,536Net derivative liability

$



$
(803
)

$



$
(803
)   Fair Value Asset (Liability) at December 31, 2009Level 1


Level 2


Level 3


Total(Dollars in thousands)Commodity futures natural gas contracts

$



$
(5,407
)

$



$
(5,407
)Total derivative liability

$



$
(5,407
)

$



$
(5,407
)       16.
    Operating
    Leases      2016 and2011

2012

2013

2014

2015

Thereafter$16,687

$13,971

$12,425

$10,828

$8,345

$45,754   17.
    Segments    
    North American Glass  includes sales of glass
    tableware from subsidiaries throughout the United States, Canada
    and Mexico.
    North American Other  includes sales of ceramic
    dinnerware; metal tableware, hollowware and serveware; and
    plastic items from subsidiaries in the United States. 108




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
   
    International  includes worldwide sales of glass
    tableware from subsidiaries outside the United States, Canada
    and Mexico.    December 31,

2010


2009


2008(Dollars in thousands)Net sales:North American Glass

$
562,653


$
522,575


$
554,128North American Other


85,996



87,041



111,029International


162,685



145,023



153,532Eliminations


(11,540
)


(6,004
)


(8,482
)Consolidated

$
799,794


$
748,635


$
810,207EBIT:North American Glass

$
109,069


$
33,727


$
25,495North American Other


13,916



9,802



(17,696
)International


3,854



(2,862
)


(12,228
)Consolidated

$
126,839


$
40,667


$
(4,429
)Special items  (income) expense (excluding
    write-off of financing fees in 2009) (see notes 6 and
    7):North American Glass

$
(54,151
)(1)

$
3,204


$
5,356North American Other


1,155



3,809



28,252International










11,890Consolidated

$
(52,996
)

$
7,013


$
45,498Depreciation & amortization:North American Glass

$
24,277


$
24,806


$
26,004North American Other


743



2,052



3,123International


16,095



16,308



15,303Consolidated

$
41,115


$
43,166


$
44,430Capital expenditures:North American Glass

$
18,075


$
10,317


$
21,170North American Other


238



339



611International


9,934



6,349



23,936Consolidated

$
28,247


$
17,005


$
45,717 109




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  December 31,

2010


2009


2008(Dollars in thousands)Total assets:North American Glass

$
792,231


$
853,412


$
837,256North American Other


62,145



53,029



54,089International


342,573



436,594



429,749Eliminations


(377,978
)


(551,521
)


(502,687
)Consolidated

$
818,971


$
791,514


$
818,407Reconciliation of EBIT to net income (loss):Segment EBIT

$
126,839


$
40,667


$
(4,429
)Interest expense


(45,171
)


(66,705
)


(69,720
)Income taxes


(11,582
)


(2,750
)


(6,314
)Net income (loss)

$
70,086


$
(28,788
)

$
(80,463
)     (1)
    
    Includes a $58.3 million gain on redemption of debt and
    $1.0 million of expenses from the secondary stock offering
    as discussed in note 6, $1.3 million of restructuring
    charges primarily related to the write-down of decorating assets
    at our Shreveport Louisiana facility, $2.7 million related
    to the write-down of certain after-processing equipment and
    $0.9 million from an insurance recovery. 110




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
     United States


Mexico


All Other


Eliminations


Consolidated(Dollars in thousands)2010Net sales:Customers

$
444,534


$
121,282


$
233,978






$
799,794Intercompany


55,432



10,846



16,085


$
(82,363
)


Total net sales

$
499,966


$
132,128


$
250,063


$
(82,363
)

$
799,794Long-lived assets

$
118,363


$
197,604


$
123,770


$



$
439,7372009Net sales:Customers

$
435,500


$
104,254


$
208,881






$
748,635Intercompany


42,832



6,958



7,927


$
(57,717
)


Total net sales

$
478,332


$
111,212


$
216,808


$
(57,717
)

$
748,635Long-lived assets

$
126,371


$
195,648


$
136,314


$



$
458,3332008Net sales:Customers

$
451,794


$
131,383


$
227,030






$
810,207Intercompany


50,825



9,402



3,555


$
(63,782
)


Total net sales

$
502,619


$
140,785


$
230,585


$
(63,782
)

$
810,207Long-lived assets

$
136,934


$
199,583


$
145,066


$



$
481,583   18.
    Condensed
    Consolidated Guarantor Financial Statements     111




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Operations
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2010

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net sales

$



$
400,565


$
85,996


$
380,912


$
(67,679
)

$
799,794Freight billed to customers






622



883



285







1,790Total revenues






401,187



86,879



381,197



(67,679
)


801,584Cost of sales






329,865



62,827



308,558



(67,679
)


633,571Gross profit






71,322



24,052



72,639







168,013Selling, general and administrative expenses






55,245



9,077



33,068







97,390Special charges






765



1,037











1,802Income (loss) from operations






15,312



13,938



39,571







68,821Other income (expense)






57,315



(133
)


836







58,018Earnings (loss) before interest and income taxes






72,627



13,805



40,407







126,839Interest expense






39,717



(5
)


5,459







45,171Earnings (loss) before income taxes






32,910



13,810



34,948







81,668Provision (benefit) for income taxes






(4,057
)


4,034



11,605







11,582Net income (loss)






36,967



9,776



23,343







70,086Equity in net income (loss) of subsidiaries


70,086



33,119











(103,205
)


Net income (loss)

$
70,086


$
70,086


$
9,776


$
23,343


$
(103,205
)

$
70,086The following represents the total
    special items (income) expense included in the above Statement
    of Operations (see notes 6 and 7):Special items included in:Cost of sales

$



$
2,329


$
(12
)

$



$



$
2,317Selling, general and administrative expenses






1,047















1,047Special charges






765



1,037











1,802Other (income) expense






(58,292
)


130











(58,162
)Total pretax special items

$



$
(54,151
)

$
1,155


$



$



$
(52,996
)Special items net of tax

$



$
(54,151
)

$
1,155


$



$



$
(52,996
)  112




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Operations
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2009

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net sales

$



$
385,467


$
87,041


$
325,175


$
(49,048
)

$
748,635Freight billed to customers






601



839



165







1,605Total revenues






386,068



87,880



325,340



(49,048
)


750,240Cost of sales






310,031



68,505



287,607



(49,048
)


617,095Gross profit






76,037



19,375



37,733







133,145Selling, general and administrative expenses






53,906



7,954



33,040







94,900Special charges






14



1,617











1,631Income (loss) from operations






22,117



9,804



4,693







36,614Other income (expense)






3,533



(138
)


658







4,053Earnings (loss) before interest and income taxes






25,650



9,666



5,351







40,667Interest expense






60,798



1



5,906







66,705Earnings (loss) before income taxes






(35,148
)


9,665



(555
)






(26,038
)Provision (benefit) for income taxes






(7,275
)


1,666



8,359







2,750Net income (loss)






(27,873
)


7,999



(8,914
)






(28,788
)Equity in net income (loss) of subsidiaries


(28,788
)


(915
)










29,703



Net income (loss)

$
(28,788
)

$
(28,788
)

$
7,999


$
(8,914
)

$
29,703


$
(28,788
)The following represents the total
    special items included in the above Statement of Operations (see
    notes 6, 7 and 9):Special items included in:Cost of sales

$



$



$
1,960


$



$



$
1,960Selling, general and administrative expenses






3,190















3,190Special charges






14



1,617











1,631Other income (expense)










(232
)










(232
)Interest expense






2,700















2,700Total pretax special charges

$



$
5,904


$
3,809


$



$



$
9,713Special charges net of tax

$



$
5,904


$
3,809


$



$



$
9,713  113




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Operations
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2008

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net sales

$



$
392,738


$
111,029


$
363,625


$
(57,185
)

$
810,207Freight billed to customers






743



1,220



459







2,422Total revenues






393,481



112,249



364,084



(57,185
)


812,629Cost of sales






345,669



104,683



310,125



(57,185
)


703,292Gross profit






47,812



7,566



53,959







109,337Selling, general and administrative expenses






44,269



11,265



32,917







88,451Special charges






683



13,861



11,890







26,434Income (loss) from operations






2,860



(17,560
)


9,152







(5,548
)Other income (expense)






(2,332
)


(504
)


3,955







1,119Earnings (loss) before interest and income taxes






528



(18,064
)


13,107







(4,429
)Interest expense






62,730



1



6,989







69,720Earnings (loss) before income taxes






(62,202
)


(18,065
)


6,118







(74,149
)Provision (benefit) for income taxes






(7,380
)


9,284



4,410







6,314Net income (loss)






(54,822
)


(27,349
)


1,708







(80,463
)Equity in net income (loss) of subsidiaries


(80,463
)


(25,641
)










106,104



Net income (loss)

$
(80,463
)

$
(80,463
)

$
(27,349
)

$
1,708


$
106,104


$
(80,463
)The following represents the total
    special items included in the above Statement of Operations (see
    note 7):Special items included in:Cost of sales

$



$
3,795


$
14,007


$
879


$



$
18,681Special charges






683



13,861



11,890







26,434Interest expense










(383
)










(383
)Total pretax special charges

$



$
4,478


$
28,251


$
12,769


$



$
45,498Special charges net of tax

$



$
4,478


$
28,251


$
12,523


$



$
45,252  114




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Balance Sheet
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorDecember 31, 2010

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Cash and equivalents

$



$
58,277


$
293


$
17,688


$



$
76,258Accounts receivable  net






37,099



5,360



49,642







92,101Inventories  net






52,398



19,902



75,846







148,146Other current assets






(2,634
)


10,960



10,518



(12,407
)


6,437Total current assets






145,140



36,515



153,694



(12,407
)


322,942Other non-current assets






8,344



2,779



41,169



(19,134
)


33,158Investments in and advances to subsidiaries


11,266



360,784



189,171



(32,151
)


(529,070
)


Goodwill and purchased intangible assets  net






26,833



15,761



149,880







192,474Total other assets


11,266



395,961



207,711



158,898



(548,204
)


225,632Property, plant and equipment  net






72,892



4,862



192,643







270,397Total assets

$
11,266


$
613,993


$
249,088


$
505,235


$
(560,611
)

$
818,971Accounts payable

$



$
13,514


$
2,926


$
42,655


$



$
59,095Accrued and other current liabilities






48,092



27,811



34,430



(12,407
)


97,926Notes payable and long-term debt due within one year






227







2,915







3,142Total current liabilities






61,833



30,737



80,000



(12,407
)


160,163Long-term debt






398,039







45,944







443,983Other long-term liabilities






131,100



21,964



69,629



(19,134
)


203,559Total liabilities






590,972



52,701



195,573



(31,541
)


807,705Total shareholders equity


11,266



23,021



196,387



309,662



(529,070
)


11,266Total liabilities and shareholders equity

$
11,266


$
613,993


$
249,088


$
505,235


$
(560,611
)

$
818,971  115




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Balance Sheet
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorDecember 31, 2009

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Cash and equivalents

$



$
37,386


$
419


$
17,284


$



$
55,089Accounts receivable  net






36,173



5,125



41,126







82,424Inventories  net






48,493



18,024



77,498







144,015Other current assets






13,840



946



9,083



(15,385
)


8,484Total current assets






135,892



24,514



144,991



(15,385
)


290,012Other non-current assets






(4,912
)


3,535



38,819



(19,134
)


18,308Investments in and advances to subsidiaries


(66,907
)


403,403



276,755



140,289



(753,540
)


Goodwill and purchased intangible assets  net






26,833



15,771



150,577







193,181Total other assets


(66,907
)


425,324



296,061



329,685



(772,674
)


211,489Property, plant and equipment  net






79,773



5,990



204,250







290,013Total assets

$
(66,907
)

$
640,989


$
326,565


$
678,926


$
(788,059
)

$
791,514Accounts payable

$



$
13,503


$
3,289


$
38,747


$



$
55,539Accrued and other current liabilities






48,440



9,375



35,064



(8,848
)


84,031Notes payable and long-term debt due within one year






215







10,300







10,515Total current liabilities






62,158



12,664



84,111



(8,848
)


150,085Long-term debt






456,152







48,572







504,724Other long-term liabilities






151,754



15,618



61,911



(25,671
)


203,612Total liabilities






670,064



28,282



194,594



(34,519
)


858,421Total shareholders equity


(66,907
)


(29,075
)


298,283



484,332



(753,540
)


(66,907
)Total liabilities and shareholders equity

$
(66,907
)

$
640,989


$
326,565


$
678,926


$
(788,059
)

$
791,514  116




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Cash Flows
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2010

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net income (loss)

$
70,086


$
70,086


$
9,776


$
23,343


$
(103,205
)

$
70,086Depreciation and amortization






14,512



743



25,860







41,115Other operating activities


(70,086
)


(67,690
)


(10,407
)


(18,524
)


103,205



(63,502
)Net cash provided by (used in) operating activities






16,908



112



30,679







47,699Additions to property, plant & equipment






(8,515
)


(238
)


(19,494
)






(28,247
)Other investing activities






(8,415
)














(8,415
)Net cash provided by (used in) investing activities






(16,930
)


(238
)


(19,494
)






(36,662
)Net borrowings






35,112







(10,210
)






24,902Other financing activities






(14,199
)














(14,199
)Net cash provided by (used in) financing activities






20,913







(10,210
)






10,703Exchange effect on cash














(571
)






(571
)Increase (decrease) in cash






20,891



(126
)


404







21,169Cash at beginning of period






37,386



419



17,284







55,089Cash at end of period

$



$
58,277


$
293


$
17,688


$



$
76,258  117




---



##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Cash Flows
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2009

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net income (loss)

$
(28,788
)

$
(28,788
)

$
7,999


$
(8,914
)

$
29,703


$
(28,788
)Depreciation and amortization






14,678



2,052



26,436







43,166Other operating activities


28,788



55,517



(9,711
)


42,879



(29,703
)


87,770Net cash provided by (used in) operating activities






41,407



340



60,401







102,148Additions to property, plant & equipment






(6,189
)


(339
)


(10,477
)






(17,005
)Other investing activities






60



5



200







265Net cash provided by (used in) investing activities






(6,129
)


(334
)


(10,277
)






(16,740
)Net borrowings (repayments)






(174
)






(39,220
)






(39,394
)Other financing activities






(4,171
)














(4,171
)Net cash provided by (used in) financing activities






(4,345
)






(39,220
)






(43,565
)Exchange effect on cash














(58
)






(58
)Increase (decrease) in cash






30,933



6



10,846







41,785Cash at beginning of period






6,453



413



6,438







13,304Cash at end of period

$



$
37,386


$
419


$
17,284


$



$
55,089  118




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##### Table of Contents



LIBBEY
    INC.
  Notes to
    Consolidated Financial
    Statements  (Continued)
  Libbey
    Inc.
  Condensed
    Consolidating Statement of Cash Flows
  Libbey


Libbey





Non-Inc.


Glass


Subsidiary


GuarantorYear Ended December 31, 2008

(Parent)


(Issuer)


Guarantors


Subsidiaries


Eliminations


Consolidated(Dollars in thousands)Net income (loss)

$
(80,463
)

$
(80,463
)

$
(27,349
)

$
1,708


$
106,104


$
(80,463
)Depreciation and amortization






14,904



3,123



26,403







44,430Other operating activities


80,463



65,694



24,718



(29,778
)


(106,104
)


34,993Net cash provided by (used in) operating activities






135



492



(1,667
)






(1,040
)Additions to property, plant & equipment






(13,003
)


(611
)


(32,103
)






(45,717
)Other investing activities






117















117Net cash (used in) investing activities






(12,886
)


(611
)


(32,103
)






(45,600
)Net borrowings






(164
)






27,458







27,294Other financing activities






(1,466
)














(1,466
)Net cash provided by (used in) financing activities






(1,630
)






27,458







25,828Exchange effect on cash














(2,423
)






(2,423
)Increase (decrease) in cash






(14,381
)


(119
)


(8,735
)






(23,235
)Cash at beginning of period






20,834



532



15,173







36,539Cash at end of period

$



$
6,453


$
413


$
6,438


$



$
13,304  119




---



##### Table of Contents



Selected
    Quarterly Financial Data (unaudited)    First Quarter


Second Quarter


Third Quarter


Fourth Quarter2010


2009


2010


2009


2010


2009


2010


2009(Dollars in thousands)Net sales

$
173,904


$
157,853


$
203,036


$
195,826


$
200,007


$
186,878


$
222,847


$
208,078Gross profit

$
33,877


$
10,716


$
48,031


$
34,283


$
41,685


$
42,960


$
44,420


$
45,186Gross profit margin


19.5
%


6.8
%


23.7
%


17.5
%


20.8
%


23.0
%


19.9
%


21.7
%Selling, general & administrative expenses

$
22,824


$
22,374


$
24,719


$
22,514


$
25,335


$
24,811


$
24,512


$
25,201Special charges

$
232


$
396


$
156


$
278


$
700


$
300


$
714


$
657Income (loss) from operations (IFO)

$
10,821


$
(12,054
)

$
23,156


$
11,491


$
15,650


$
17,849


$
19,194


$
19,328IFO margin


6.2
%


(7.6
)%


11.4
%


5.9
%


7.8
%


9.6
%


8.6
%


9.3
%Earnings (loss) before interest and income taxes (EBIT)

$
66,850


$
(12,091
)

$
24,812


$
14,249


$
15,673


$
20,552


$
19,504


$
17,957EBIT margin


38.4
%


(7.7
)%


12.2
%


7.3
%


7.8
%


11.0
%


8.8
%


8.6
%Earnings before interest, taxes, depreciation and amortization
    (EBITDA)

$
77,236


$
(363
)

$
35,380


$
24,767


$
25,713


$
31,181


$
29,625


$
28,248EBITDA margin


44.4
%


(0.2
)%


17.4
%


12.6
%


12.9
%


16.7
%


13.3
%


13.6
%Net income (loss)

$
55,410


$
(27,893
)

$
9,567


$
2,664


$
2,346


$
3,533


$
2,763


$
(7,092
)Net income margin


31.9
%


(17.7
)%


4.7
%


1.4
%


1.2
%


1.9
%


1.2
%


(3.4
)%Diluted earnings (loss) per share

$
2.76


$
(1.89
)

$
0.47


$
0.18


$
0.12


$
0.23


$
0.13


$
(0.45
)Accounts receivable  net

$
87,506


$
74,555


$
92,782


$
91,252


$
110,574


$
91,119


$
92,101


$
82,424DSO


41.8



34.9



43.9



44.3



51.4



45.7



42.0



40.2Inventories  net

$
152,503


$
169,426


$
153,187


$
145,798


$
159,374


$
153,523


$
148,146


$
144,015DIO


72.8



79.2



72.4



70.8



74.1



77.1



67.6



70.2Accounts payable

$
49,550


$
46,906


$
52,427


$
49,307


$
55,496


$
46,020


$
59,095


$
55,539DPO


23.7



21.9



24.8



23.9



25.8



23.1



27.0



27.1Working capital

$
190,459


$
197,075


$
193,542


$
187,743


$
214,452


$
198,622


$
181,152


$
170,900DWC


90.9



92.2



91.5



91.2



99.7



99.7



82.6



83.3Percent of net sales


24.9
%


25.2
%


25.1
%


25.0
%


27.3
%


27.3
%


22.6
%


22.8
%Net cash provided by (used in) operating activities

$
(46,165
)

$
14,384


$
38,112


$
24,706


$
(2,780
)

$
26,639


$
58,532


$
36,419Free Cash Flow

$
(50,313
)

$
9,511


$
30,881


$
20,117


$
(10,523
)

$
24,074


$
49,407


$
31,706Total borrowings  net

$
452,011


$
540,856


$
452,448


$
543,032


$
456,102


$
526,669


$
447,125


$
515,239  120




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##### Table of Contents



First Quarter


Second Quarter


Third Quarter


Fourth Quarter2010


2009


2010


2009


2010


2009


2010


2009(Dollars in thousands)Special items included in:Cost of sales

$



$
1,823


$
1,742


$
(2
)

$
578


$
162


$
(3
)

$
(23
)Selling, general & administrative expense






2,500







200



1,096



255



(49
)


235Special charges


232



396



156



278



700



300



714



657Gain on redemption of debt


(56,792
)






















(1,500
)


Other expense (income)


130



229







(43
)






27







19Interest expense






























2,700Total pre-tax special items  (income) expense

$
(56,430
)

$
4,948


$
1,898


$
433


$
2,374


$
744


$
(838
)

$
3,588Special items  net of tax

$
(56,430
)

$
4,948


$
1,898


$
433


$
2,374


$
744


$
(838
)

$
3,588   Stock
    Market Information
  LBY.
  2010


2009Cash








CashPrice Range


Dividend


Price Range


DividendHigh


Low


Declared


High


Low


DeclaredFirst Quarter

$
14.25


$
7.23


$



$
2.05


$
0.73


$
Second Quarter

$
15.00


$
12.15


$



$
2.75


$
0.47


$
Third Quarter

$
14.03


$
9.88


$



$
4.27


$
1.30


$
Fourth Quarter

$
15.47


$
12.36


$



$
7.99


$
3.75


$
  121




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##### Table of Contents



ITEM 9.
    CHANGES
    IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
    FINANCIAL DISCLOSURE    ITEM 9A.
    CONTROLS
    AND PROCEDURES    Rule 13a-15(b),
  Report of
    Management
           122




---



##### Table of Contents



Changes
    in Internal Control
    ITEM 9B.
    OTHER
    INFORMATION   PART III  ITEM 10.
    DIRECTORS,
    EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE    www.libbey.com 43699-0060.
  ITEM 11.
    EXECUTIVE
    COMPENSATION    ITEM 12.
    SECURITY
    OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
    RELATED STOCKHOLDER MATTERS   123




---



##### Table of Contents



ITEM 13.
    CERTAIN
    RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR
    INDEPENDENCE    ITEM 14.
    PRINCIPAL
    ACCOUNTING FEES AND SERVICES   PART IV  ITEM 15.
    EXHIBITS,
    FINANCIAL STATEMENT SCHEDULES    PageReports of Independent Registered Public Accounting Firm


56Consolidated Balance Sheets at December 31, 2010 and 2009


58For the years ended December 31, 2010, 2009 and 2008:Consolidated Statements of Operations


59Consolidated Statements of Shareholders Equity (Deficit)


60Consolidated Statements of Cash Flows


61Notes to Consolidated Financial Statements


62Selected Quarterly Financial Data (Unaudited)


120Financial Statement Schedule of Libbey Inc. for the years ended
    December 31, 2010, 2009 and 2008 for Schedule II
    Valuation and Qualifying Accounts (Consolidated)


S-1      124




---



##### Table of Contents



SIGNATURES      by:
    /s/  Richard
    I. Reynolds      125




---



##### Table of Contents



SIGNATURES
    Signature

TitleWilliam A. Foley

DirectorPeter C. McC. Howell

DirectorCarol B. Moerdyk

DirectorJean-René Gougelet

DirectorTerence P. Stewart

DirectorCarlos V. Duno

DirectorDeborah G. Miller

DirectorJohn C. Orr

DirectorRichard I. Reynolds

Director, Executive Vice President, Chief Financial OfficerJohn F. Meier

Chairman of the Board of Directors, Chief Executive Officer    By:
    /s/  Richard
    I. Reynolds   Attorney-In-Fact
     
       126




---



##### Table of Contents



INDEX TO
    FINANCIAL STATEMENT SCHEDULE  PageFinancial Statement Schedule of Libbey Inc. for the years ended
    December 31, 2010, 2009, and 2008 for Schedule II
    Valuation and Qualifying Accounts (Consolidated)


S-1  127




---



##### Table of Contents



LIBBEY
    INC.
  SCHEDULE II 
    VALUATION AND QUALIFYING ACCOUNTS (Consolidated)
    Years ended December 31, 2010, 2009 and 2008
  Allowance for


ValuationSlow Moving


AllowanceAllowance for


and Obsolete


for DeferredDoubtful Accounts


Inventory


Tax Asset(Dollars in thousands)Balance at December 31, 2007

$
11,711


$
6,435


$
28,855Charged to expense or other accounts


181



2,391



58,587Deductions


(1,413
)


(2,244
)


Balance at December 31, 2008


10,479



6,582



87,442Charged to expense or other accounts


2,049



1,431



11,547Deductions


(5,071
)


(3,485
)


Balance at December 31, 2009


7,457



4,528



98,989Charged to expense or other accounts


457



1,774



(26,662
)Deductions


(2,396
)


(1,644
)


Balance at December 31, 2010

$
5,518


$
4,658


$
72,327  S-1




---



##### Table of Contents



EXHIBIT INDEX
  S-K Item601 No.



Document2
.0



Asset Purchase Agreement dated as of September 22, 1995 by
    and among The Pfaltzgraff Co., The Pfaltzgraff Outlet Co.,
    Syracuse China Company of Canada Ltd., LG Acquisition Corp. and
    Libbey Canada Inc., Acquisition of Syracuse China Company (filed
    as Exhibit 2.0 to Libbey Inc.s Current Report on
    Form 8-K
    dated September 22, 1995 and incorporated herein by
    reference).2
.1



Asset Purchase Agreement dated as of December 2, 2002 by
    and between Menasha Corporation and Libbey Inc. (filed as
    Exhibit 2.2 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year-ended December 31, 2002, and incorporated
    herein by reference).2
.2



Stock Purchase Agreement dated as of December 31, 2002
    between BSN Glasspack N.V. and Saxophone B.V. (filed as
    Exhibit 2.3 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year-ended December 31, 2002, and incorporated
    herein by reference).3
.1



Restated Certificate of Incorporation of Libbey Inc. (filed as
    Exhibit 3.1 to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 1993 and incorporated herein
    by reference)3
.2



Amended and Restated By-Laws of Libbey Inc. (filed as
    Exhibit 3.2 to Libbey Inc.s
    Form 8-K
    filed on February 22, 2011, which is incorporated herein by
    reference).3
.3



Certificate of Incorporation of Libbey Glass Inc. (incorporated
    by reference to Exhibit 3.3 to Libbey Glass Inc.s
    Registration Statement on
    Form S-4;
    File
    No. 333-139358).3
.4



Amended and Restated By-Laws of Libbey Glass Inc. (incorporated
    by reference to Exhibit 3.4 to Libbey Glass Inc.s
    Registration Statement on
    Form S-4;
    File
    No. 333-139358).4
.1



Certificate of Incorporation of Libbey Glass Inc. (incorporated
    by reference to Exhibit 3.3).4
.2



Amended and Restated By-Laws of Libbey Glass Inc. (incorporated
    by reference to Exhibit 3.4).4
.3



Warrant, issued June 16, 2006 (filed as Exhibit 4.7 to
    Libbey Inc.s Current Report on
    Form 8-K
    filed June 21, 2006 and incorporated herein by reference).4
.4



Amended and Restated Registration Rights Agreement, dated
    October 29, 2009, among Libbey Inc. and Merrill Lynch PCG,
    Inc. (filed as Exhibit 4.4 to Libbey Inc.s Current
    Report on
    Form 8-K
    filed October 29, 2009 and incorporated herein by
    reference).4
.5



Amendment and Restated Credit Agreement, dated February 8,
    2010, among Libbey Glass Inc. and Libbey Europe B.V., as
    borrowers, Libbey Inc., as a loan guarantor, the other loan
    parties party thereto as guarantors, JPMorgan Chase Bank, N.A.,
    as administrative agent with respect to the U.S. loans,
    J.P. Morgan Europe Limited, as administrative agent with
    respect to the Netherlands loans, Bank of America, N.A. and
    Barclays Capital, as Co-Syndication Agents, Wells Fargo Capital
    Finance, LLC, as Documentation Agent and the other lenders and
    agents party thereto (filed as Exhibit 4.1 to Libbey
    Inc.s Current Report on
    Form 8-K
    filed on February 12, 2010 and incorporated herein by
    reference).4
.6



New Notes Indenture, dated February 8, 2010, among Libbey
    Glass Inc., Libbey Inc., the domestic subsidiaries of Libbey
    Glass Inc. listed as guarantors therein, and The Bank of New
    York Mellon Trust Company, N.A., as trustee and collateral
    agent (filed as Exhibit 4.2 to Libbey Inc.s Current
    Report on
    Form 8-K
    filed on February 12, 2010 and incorporated herein by
    reference).4
.7



Form of New Notes (included as Exhibits A and B to New
    Notes Indenture referred to in Exhibit 4.6 above).4
.8



Intercreditor Agreement, dated February 8, 2010, among
    Libbey Glass Inc., Libbey Inc., and the domestic subsidiaries of
    Libbey Glass Inc. listed as guarantors (filed as
    Exhibit 4.5 to Libbey Inc.s Current Report on
    Form 8-K
    filed on February 12, 2010 and incorporated herein by
    reference).10
.1



Management Services Agreement dated as of June 24, 1993
    between Owens-Illinois General Inc. and Libbey Glass Inc. (filed
    as Exhibit 10.2 to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 1993 and incorporated herein
    by reference).10
.2



Tax Allocation and Indemnification Agreement dated as of
    May 18, 1993 by and among Owens-Illinois, Inc.,
    Owens-Illinois Group, Inc. and Libbey Inc. (filed as
    Exhibit 10.3 to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 1993 and incorporated herein
    by reference). 128




---



##### Table of Contents



S-K Item601 No.



Document10
.3



Pension and Savings Plan Agreement dated as of June 17,
    1993 between Owens-Illinois, Inc. and Libbey Inc. (filed as
    Exhibit 10.4 to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 1993 and incorporated herein
    by reference).10
.4



Cross-Indemnity Agreement dated as of June 24, 1993 between
    Owens-Illinois, Inc. and Libbey Inc. (filed as Exhibit 10.5
    to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 1993 and incorporated herein
    by reference).10
.5



Libbey Inc. Guarantee dated as of October 10, 1995 in favor
    of The Pfaltzgraff Co., The Pfaltzgraff Outlet Co. and Syracuse
    China Company of Canada Ltd. guaranteeing certain obligations of
    LG Acquisition Corp. and Libbey Canada Inc. under the Asset
    Purchase Agreement for the Acquisition of Syracuse China
    (Exhibit 2.0) in the event certain contingencies occur
    (filed as Exhibit 10.17 to Libbey Inc.s Current
    Report on
    Form 8-K
    dated October 10, 1995 and incorporated herein by
    reference).10
.6



Susquehanna Pfaltzgraff Co. Guarantee dated as of
    October 10, 1995 in favor of LG Acquisition Corp. and
    Libbey Canada Inc. guaranteeing certain obligations of The
    Pfaltzgraff Co., The Pfaltzgraff Outlet Co. and Syracuse China
    Company of Canada, Ltd. under the Asset Purchase Agreement for
    the Acquisition of Syracuse China (Exhibit 2.0) in the
    event certain contingencies occur (filed as Exhibit 10.18
    to Libbey Inc.s Current Report on
    Form 8-K
    dated October 10, 1995 and incorporated herein by
    reference).10
.7



First Amended and Restated Libbey Inc. Executive Savings Plan
    (filed as Exhibit 10.23 to Libbey Inc.s Annual Report
    on
    Form 10-K
    for the year ended December 31, 1996 and incorporated
    herein by reference).10
.8



Form of Non-Qualified Stock Option Agreement between Libbey Inc.
    and certain key employees participating in The 1999 Equity
    Participation Plan of Libbey Inc. (filed as Exhibit 10.69
    to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 1999 and incorporated
    herein by reference).10
.9



The 1999 Equity Participation Plan of Libbey Inc. (filed as
    Exhibit 10.67 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 1999 and incorporated
    herein by reference).10
.10



Stock Promissory Sale and Purchase Agreement between
    VAA  Vista Alegre Atlantis SGPS, SA and Libbey Europe
    B.V. dated January 10, 2005 (filed as Exhibit 10.76 to
    Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2004 and incorporated
    herein by reference).10
.11



RMB Loan Contract between Libbey Glassware (China) Company
    Limited and China Construction Bank Corporation Langfang
    Economic Development Area
    Sub-branch
    entered into January 23, 2006 (filed as exhibit 10.75
    to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2005 and incorporated
    herein by reference).10
.12



Guarantee Contract executed by Libbey Inc. for the benefit of
    China Construction Bank Corporation Langfang Economic
    Development Area
    Sub-branch
    (filed as exhibit 10.76 to Libbey Inc.s Annual Report
    on
    Form 10-K
    for the year ended December 31, 2005 and incorporated
    herein by reference).10
.13



Limited Waiver and Second Amendment to Purchase Agreement, dated
    June 16, 2006, among Vitro, S.A. de C.V., Crisa
    Corporation, Crisa Libbey S.A. de C.V., Vitrocrisa Holdings, S.
    de R.L. de C.V., Vitrocrisa S. de R.L. de C.V., Vitrocrisa
    Commercial S. de R.L. de C.V., Crisa Industrial, L.L.C., Libbey
    Mexico, S. de R.L. de C.V., Libbey Europe B.V., and LGA3 Corp.
    (filed as exhibit 10.1 to Libbey Inc.s Quarterly
    Report on
    Form 10-Q
    for the quarter ended June 30, 2006 and incorporated herein
    by reference).10
.14



Guaranty, dated May 31, 2006, executed by Libbey Inc. in
    favor of Fondo Stiva S.A. de C.V. (filed as exhibit 10.2 to
    Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2006 and incorporated herein
    by reference).10
.15



Guaranty Agreement, dated June 16, 2006, executed by Libbey
    Inc. in favor of Vitro, S.A. de C.V. (filed as exhibit 10.3
    to Libbey Inc.s Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2006 and incorporated herein
    by reference).10
.16



Libbey Inc. Amended and Restated Deferred Compensation Plan for
    Outside Directors (incorporated by reference to
    Exhibit 10.61 to Libbey Glass Inc.s Registration
    Statement on
    Form S-4;
    File No. 333-139358). 129




---



##### Table of Contents



S-K Item601 No.



Document10
.17



2009 Director Deferred Compensation Plan (filed as
    Exhibit 10.51 to Libbey Incs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2008 and incorporated
    herein by this reference)10
.18



Executive Deferred Compensation Plan (filed as
    Exhibit 10.52 to Libbey Incs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2008 and incorporated
    herein by this reference).10
.19



Amended and Restated Employment Agreement dated as of
    December 31, 2008 between Libbey Inc. and John F. Meier
    (filed as exhibit 10.29 to Libbey Inc.s Annual Report
    on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.20



Amended and Restated Employment Agreement dated as of
    December 31, 2008 between Libbey Inc. and Richard I.
    Reynolds (filed as exhibit 10.30 to Libbey Inc.s
    Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.21



Amended and Restated Employment Agreement dated as of
    December 31, 2008 between Libbey Inc. and Gregory T.
    Geswein (filed as exhibit 10.31 to Libbey Inc.s
    Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.22



Form of Amended and Restated Employment Agreement dated as of
    December 31, 2008 between Libbey Inc. and the respective
    executive officers identified on Appendix 1 thereto (filed
    as exhibit 10.32 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.23



Amended and restated change in control agreement dated as of
    December 31, 2008 between Libbey Inc. and John F. Meier
    (filed as exhibit 10.33 to Libbey Inc.s Annual Report
    on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.24



Form of amended and restated change in control agreement dated
    as of December 31, 2008 between Libbey Inc. and the
    respective executive officers identified on Appendix 1
    thereto (filed as exhibit 10.34 to Libbey Inc.s
    Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.25



Form of amended and restated change in control agreement dated
    as of December 31, 2008 between Libbey Inc. and the
    respective individuals identified on Appendix 1 thereto
    (filed as exhibit 10.35 to Libbey Inc.s Annual Report
    on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.26



Form of Amended and Restated Indemnity Agreement dated as of
    December 31, 2008 between Libbey Inc. and the respective
    officers identified on Appendix 1 thereto (filed as
    exhibit 10.36 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.27



Form of Amended and Restated Indemnity Agreement dated as of
    December 31, 2008 between Libbey Inc. and the respective
    outside directors identified on Appendix 1 thereto (filed
    as exhibit 10.37 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.28



Amended and Restated Libbey Inc. Supplemental Retirement Benefit
    Plan effective December 31, 2008 (filed as
    exhibit 10.38 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.29



Amendment to the First Amended and Restated Libbey Inc.
    Executive Savings Plan effective December 31, 2008 (filed
    as exhibit 10.39 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2008 and incorporated
    herein by reference).10
.30



Employment Agreement dated as of January 1, 2010 between
    Libbey Inc. and Roberto B. Rubio. (filed as Exhibit 10.39
    to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2009 and incorporated
    herein by reference.)10
.31



Change in control agreement dated as of January 1, 2010
    between Libbey Inc. and Roberto B. Rubio. (filed as
    Exhibit 10.40 to Libbey Inc.s Annual Report on
    Form 10-K
    for the year ended December 31, 2009 and incorporated
    herein by reference.)10
.32



Amended and Restated 2006 Omnibus Incentive Plan of Libbey Inc
    (filed as Exhibit 10.29 to Libbey Inc.s Quarterly
    Report on
    Form 10-Q
    for the quarter ended September 30, 2010 and incorporated
    herein by reference.) 130




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##### Table of Contents



S-K Item601 No.



Document12
.1



Statement Regarding Computation of Ratios (incorporated by
    reference to Exhibit 12.1 to Libbey Glass Inc.s
    Registration Statement on
    Form S-4;
    File
    No. 333-170763).13
.1



Selected Financial Information included in Registrants
    2010 Annual Report to Shareholders (filed herein).21




Subsidiaries of the Registrant (filed herein).23




Consent of Ernst & Young LLP (filed herein).24




Power of Attorney (filed herein).31
.1



Certification of Chief Executive Officer Pursuant to
    Rule 13a-14(a)
    or
    Rule 15d-14(a)
    (filed herein).31
.2



Certification of Chief Financial Officer Pursuant to
    Rule 13a-14(a)
    or
    Rule 15d-14(a)
    (filed herein).32
.1



Chief Executive Officer Certification Pursuant to 18 U.S.C
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002 (filed herein).32
.2



Chief Financial Officer Certification Pursuant to 18 U.S.C
    Section 1350, as adopted pursuant to Section 906 of
    the Sarbanes-Oxley Act of 2002 (filed herein).  131