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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, DC 20549
 
 FORM 10-K
 
 (Mark One)
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2009
 OR
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from  to
 Commission file number 000-16496
 
 Constar International Inc.
 (Exact name of registrant as specified in its charter)
 
 Delaware
(State or other jurisdiction 
of incorporation or organization)
    
    13-1889304
(I.R.S. Employer
Identification Number)One Crown Way, Philadelphia, PA
(Address of principal executive offices)
    
    19154
(Zip Code)
 (215) 552-3700
(Registrants telephone number, including area code)
 Securities registered pursuant to Section 12(b) of the Act: None
 Securities registered pursuant to Section 12(g) of the Act: Common Stock, $.01 Par Value
 
 Yes o No þ
 Yes o No þ
 Yes þ No o
 Yes o No o
 Form 10-K. o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 Yes o No þ
  Yes þ No o
  DOCUMENTS INCORPORATED BY REFERENCE




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TABLE OF CONTENTS
 PART IItem 1. Business
    
    
    3Item 1A. Risk Factors
    
    
    8Item 1B. Unresolved Staff Comments
    
    
    15Item 2. Properties
    
    
    15Item 3. Legal Proceedings
    
    
    15Item 4. Reserved
    
    
    17PART IIItem 5. Market for Registrants Common Stock and Related Stockholder Matters and Issuer Purchases of Equity Securities
    
    
    17Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    19Item 8. Financial Statements and Supplementary Data
    
    
    32Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    86Item 9A. Controls and Procedures
    
    
    86Item 9B. Other Information
    
    
    86PART IIIItem 10. Directors, Executive Officers and Corporate Governance
    
    
    87Item 11. Executive Compensation
    
    
    89Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
    
    
    98Item 13. Certain Relationships and Related Transactions, and Director Independence
    
    
    100Item 14. Principal Accounting Fees and Services
    
    
    100PART IVItem 15. Exhibits and Financial Statement Schedules
    
    
    102SIGNATURES
    
    
    105Exhibit 21.1Exhibit 23.1Exhibit 31.1Exhibit 31.2Exhibit 32.1Exhibit 32.2




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CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS
 This annual report on Form 10-K includes forward-looking statements. Forward-looking
statements can be identified by words such as anticipate, believe, expect, intend, plan,
project, will, may, could, should, pro forma, continues, estimates, potential,
predicts, goal,  objective or similar expressions. Statements made regarding future results
are subject to numerous assumptions, uncertainties and risks that may cause future results to be
materially different from the results stated or implied in this document. The following are among
the important factors that could cause actual results to differ materially from any results
projected, forecasted, estimated or budgeted:
 
    
    Our $220 million of Secured Notes will mature on February 15, 2012. We do not have
sufficient funds on hand to repay them, nor do we expect to generate sufficient funds
from operations to repay them;
 
    
    We have had net losses in recent years and may not generate profits in the future;
 
    
    Our debt level and our ability to service existing debt or, if necessary, to
refinance that debt;
 
    
    The impact of our debt on operating flexibility;
 
    
    We expect to fund operations using a credit facility that is subject to conditions
and borrowing base limitations;
 
    
    Our ability to comply with the financial and operating covenants in the instruments
governing our indebtedness;
 
    
    The market for our products is dominated by a few large purchasers, and a
significant portion of our sales is concentrated with some of them;
 
    
    Our concentration of sales in conventional containers, the risk that the market for
such products may decline, our ability to grow our custom business, and the risk of
product obsolescence;
 
    
    Customers may not purchase our products in the amounts expected by us under their
contracts;
 
    
    The impact of PepsiCos acquisition of formerly independent bottlers, and the
impact of other customer consolidation;
 
    
    The impact of increased industry capacity on pricing and volumes;
 
    
    General economic and political conditions;
 
    
    The impact of price competition on gross margins and profitability;
 
    
    The continued movement of customers toward self-manufacturing;
 
    
    Our customers success in selling their products in their markets;
 
    
    Risks associated with our international operations;
 
    
    The terms upon which we acquire resin and our ability to pass through resin related
price increases in our sales;
 
    
    Our ability to obtain resins that are compatible with our technologies;
 
    
    Increases in the price of petrochemical products such as PET resin and the effect
of such increases on the demand for PET products;
 
    
    Our ability to protect our existing technologies and to develop new technologies;
 
    
    Our ability to timely market products incorporating our MonOxbar and
DiamondCleartechnologies;
  1




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
    
    The expiration of patents pertaining to the MonOxbar technology, and no
patents have been issued on DiamondClear and other technologies;
 
    
    Our stock is no longer listed on a national securities exchange, and it will likely
be more difficult for stockholders and investors to sell our common stock or to obtain
accurate quotations of the share price of our common stock;
 
    
    Our ability to maintain an effective system of internal controls and remediate any
material weaknesses or significant deficiencies that may be identified from time to time;
 
    
    Legal and regulatory proceedings and developments;
 
    
    Seasonal fluctuations in demand and the impact of weather on sales;
 
    
    Our ability to identify trends in the markets in which we compete and to offer new
solutions that address the changing needs of these markets;
 
    
    Our ability to successfully execute our business model and enhance our product mix;
 
    
    As a result of our Chapter 11 reorganization, our historical financial information
may not be indicative of our future financial performance;
 
    
    Our ability to successfully prosecute or defend the legal proceedings to which we
are a party; and
 
    
    The other factors disclosed from time to time by the Company in its filings with
the Securities and Exchange Commission.
 These factors are not necessarily all of the important factors that could cause actual results
to differ materially from those expressed in any of our forward-looking statements. Other unknown
or unpredictable factors, including without limitation those discussed under Risk Factors below,
could also have material adverse effects on future results. The Company undertakes no obligation to
update publicly any forward-looking statement whether as a result of new information or future
events.
  2




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PART I
 
 ITEM 1.
    
    BUSINESS
 General
    The PET Container Market
      (In millions)
    
    2009
    
    
    2008Conventional
    
    $
    427.2
    
    
    $
    594.9Custom
    
    
    182.5
    
    
    
    221.2Other
    
    
    28.7
    
    
    
    41.8Total
    
    $
    638.4
    
    
    $
    857.9
  3




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Technologies
  Oxygen-Barrier Technology. TM
 
    
    Exceptional Clarity.Some PET containers with alternative oxygen barrier
technologies appear cloudy, giving a less than perfect presentation when filled and placed
on store shelves. DiamondClear delivers glass-like clarity.
 
    
    Barrier Protection. DiamondClear is a powerful oxygen scavenger. DiamondClear
300 is particularly powerful, keeping products fresh and colors vibrant for long periods of
time.
 
    
    Recycling.Some oxygen barrier products will negatively impact the PET
recycling stream. DiamondClear 300 provides a significant improvement in recyclability.
 
    
    Monolayer Structure. Multilayer oxygen scavenging bottles require special
production equipment to incorporate barrier material between two or more layers of PET.
Monolayer bottles incorporate the scavenging technology into a single layer of PET without
specialized equipment. In a multi-layer structure, layers can separate. This delamination
impairs the bottles clarity and poses aesthetic concerns. DiamondClear monolayer PET
bottles eliminate delamination.
 
    
    Light-weighting. Bottling companies wish to minimize container weight to reduce
cost and improve sustainability. As the thickness of a container decreases, the amount of
oxygen that penetrates the package wall increases. DiamondClear 300s robust oxygen
scavenging capacity allows for more light-weighting without compromising shelf life.
 TM
 Hot-fill Technology
 
    
    Vertical Compensation. PET bottles with vertical compensation technology, or
VCTTM, use concentric rings (or hoop geometry) to absorb vacuum and eliminate
the need for traditional vacuum panels.
 
    
    X-4TM.Containers using X-4TM technology absorb the
vacuum in the base, allowing for cylindrical containers with smooth, rigid walls. The X-4
technology provides complete design flexibility to customers converting from glass to PET
who want to retain the same bottle shape.
   R&D Centers.
  4




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Intellectual Property
 Customers
  Sources and Availability of Raw Materials
     5




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Competition
    Seasonality
  Working Capital
  Environmental Liabilities and Costs
   6




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Employees
  Financial Information by Segment
  Securities Exchange Act Reports
   7




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ITEM 1A.
    
    RISK FACTORS
 Our business involves a number of risks, some of which are beyond our control. You should
carefully consider each of the risks and uncertainties we describe below, and all of the other
information in this Form 10-K and the Companys other SEC filings. Additional risks and
uncertainties not currently known to us or that we currently deem immaterial may also become
important factors that may harm our business
 We do not have sufficient funds to repay our Secured Notes that mature on February 15, 2012.
  We may not generate profits in the future and we had net losses in recent years.
  Our indebtedness may reduce our operating flexibility and may adversely affect our ability to
incur additional debt to fund future needs.
  
    
    limiting our ability to obtain additional financing for capital
expenditures, working capital, and other general corporate purposes,
particularly because substantially all of our assets are currently
subject to liens;
 
    
    increasing our vulnerability to economic downturns and changing market and industry conditions;
 
    
    limiting our ability to compete with companies that are not as highly
leveraged and that may be better positioned to withstand economic
downturns;
 
    
    impacting the Companys ability to retain existing customers and attract new customers; and
 
    
    requiring us to dedicate a substantial portion of our cash flow from
operations to service our debt, thereby reducing the availability of
cash to fund business needs.
 Our credit facility includes borrowing base limitations and other restrictions under which we
may not be able to borrow the full amount of the facility.
  
    
    management of working capital;
 
    
    a decline in the price of resin or other declines in the prices of our products;
 
    
    an increase in the value of the United States dollar relative to foreign currencies; and
 
    
    the administrative agent is entitled to conduct field audits and
inventory appraisals that may result in the application of a lower
valuation.
  8




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
    
    if inventory is located on properties that we lease and if we are
unable to obtain consents from the landlords such inventory may not be
eligible for inclusion in the borrowing base; and
 
    
    the administrative agent has the ability to reduce our borrowing
availability at any time by, for example, establishing reserves or
declaring certain collateral ineligible.
 We must comply with financial and other covenants in our credit facility and other debt
agreements
    Our key technologies are not covered by patents.
    9




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A significant portion of our sales is concentrated with a few large customers.
   Conventional PET containers account for a significant portion of our consolidated net sales.
  Our customers are engaging in self-manufacturing.
  Consolidation of our customers may reduce the Companys volumes and profitability
   Contracts with customers generally do not require them to purchase any minimum amounts of
products from us, and customers may not purchase amounts that meet our expectations.
   10




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Pricing and volumes in our markets are sensitive to production capacity utilization.
  If the Companys custom PET packaging business does not grow, our growth and profitability may
be lower than we currently expect.
  Our products and services may become obsolete.
  We are dependent on a limited number of resin and chemical suppliers
  Increases in the price of resin may negatively impact our financial results and may deter the
growth of the PET market.
   11




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Customers may supply us with an increasing amount of resin, which may reduce our ability to
negotiate favorable resin purchase contracts.
  We earn a significant portion of our revenue in warmer months, and cool weather may result in
lower sales and cash flows.
   A small number of stockholders are in a position to influence most of our significant
corporate actions because they hold a significant amount of our common stock.
  Our interest expense may increase since indebtedness under the Secured Notes and our Credit
Facility is subject to floating interest rates.
  We are subject to foreign currency risk and other instabilities from our international
operations.
   12




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We are exposed to the risk of liabilities or claims related to environmental and health and
safety standards.
   Our operations and profitability could suffer if we experience labor relations problems or if
we do not reach new union agreements on satisfactory terms.
  We face product liability risks and the risk of negative publicity if our products fail or if
our customers and suppliers are affected by product liability risks or negative publicity.
  As a result of our Chapter 11 reorganization, our historical financial information may not be
indicative of our future financial performance.
  We have a significant amount of goodwill and intangible assets that we may be required to
write down in certain circumstances, which would result in lower reported net income (or higher net
losses) and a reduction to stockholders equity.
   13




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We are subject to lawsuits and claims that could adversely affect our results of operations
and financial position.
  We have underfunded pension plans and an unfunded post-retirement medical/life insurance plan,
which could affect our cash flows and financial condition.
   Our stock is not listed on a national securities exchange. It will likely be more difficult
for stockholders and investors to sell our common stock or to obtain accurate quotations of the
share price of our common stock.
   14




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ITEM 1B.
    
    UNRESOLVED STAFF COMMENTS
  
 ITEM 2.
    
    PROPERTIES
  Location
    
    Type of Facility
    
    Size(1)
    
    
    Ownership StatusUnited StatesPhiladelphia, Pennsylvania
    
    Headquarters
    
    
    24,328
    
    
    LeasedAlsip, Illinois
    
    Research and Development
    
    
    44,392
    
    
    LeasedAtlanta, Georgia
    
    Warehouse
    
    
    186,731
    
    
    LeasedAtlanta, Georgia
    
    Plant and Warehouse
    
    
    121,704
    
    
    OwnedCharlotte, North Carolina
    
    Warehouse
    
    
    185,768
    
    
    LeasedCharlotte, North Carolina
    
    Plant and Warehouse
    
    
    142,500
    
    
    OwnedCheraw,
South Carolina (closed)
    
    Plant and Warehouse
    
    
    91,356
    
    
    LeasedCollierville,
Tennessee (closed)
    
    Plant
    
    
    200,001
    
    
    OwnedDallas, Texas
    
    Plant and Warehouse
    
    
    636,480
    
    
    LeasedHavre de Grace, Maryland
    
    Plant and Warehouse
    
    
    437,564
    
    
    OwnedHavre de Grace, Maryland
    
    Plant and Warehouse
    
    
    175,200
    
    
    OwnedHouston,
Texas (closed)
    
    Plant and Warehouse
    
    
    191,537
    
    
    LeasedJackson, Mississippi
    
    Plant and Warehouse
    
    
    127,043
    
    
    OwnedKansas City, Kansas
    
    Warehouse
    
    
    47,277
    
    
    LeasedKansas City, Kansas
    
    Plant and Warehouse
    
    
    236,633
    
    
    LeasedHebron, Ohio
    
    Warehouse
    
    
    211,200
    
    
    LeasedHebron, Ohio
    
    Plant
    
    
    109,800
    
    
    LeasedOrlando, Florida
    
    Plant and Warehouse
    
    
    360,000
    
    
    LeasedOrlando, Florida
    
    Plant and Warehouse
    
    
    139,332
    
    
    LeasedWest Chicago, Illinois
    
    Warehouse
    
    
    100,990
    
    
    LeasedWest Chicago, Illinois
    
    Plant and Warehouse
    
    
    123,100
    
    
    OwnedEuropeZevenaar, Netherlands
    
    Plant
    
    
    22,030
    
    
    OwnedSherburn, England
    
    Plant
    
    
    22,748
    
    
    OwnedSherburn, England
    
    Warehouse
    
    
    5,125
    
    
    Owned
 
 (1)
    
    In square feet for the properties located in North America and in square meters for the
properties located in Europe, unless otherwise noted.    
 ITEM 3.
    
    LEGAL PROCEEDINGS
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ITEM 4.
    
    RESERVED
 
 PART II
 
 ITEM 5.
    
    MARKET FOR REGISTRANTS COMMON STOCK AND RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES
    Predecessor
    
    
    SuccessorPeriod from
    
    
    Period fromApril 1, 2009
    
    
    May 30, 20091st Quarter
    
    
    to May 29, 2009
    
    
    to June 30, 2009
    
    
    3rd Quarter
    
    
    4th Quarter2009:High
    
    $
    0.07
    
    
    $
    0.05
    
    
    $
    16.00
    
    
    $
    20.00
    
    
    $
    27.00Low
    
    $
    0.01
    
    
    $
    0.02
    
    
    $
    0.01
    
    
    $
    10.50
    
    
    $
    17.20
 Predecessor1st Quarter
    
    
    2nd Quarter
    
    
    3rd Quarter
    
    
    4th Quarter2008:High
    
    $
    4.44
    
    
    $
    3.22
    
    
    $
    2.52
    
    
    $
    1.07Low
    
    $
    1.95
    
    
    $
    1.80
    
    
    $
    0.62
    
    
    $
    0.03
  17




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Holders of Common Stock
  Dividends
  Securities Authorized for Issuance Under Equity Compensation Plans
   18




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ITEM 7.
    
    MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
 Overview
       19




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Chapter 11 Proceedings
  Relationship with Crown
      20




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Basis of Presentation
  Reorganizations
    21




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Results of Operations
 2009 Compared to 2008
 Net Sales
 $
    
    
    %December 31,
    
    
    Increase
    
    
    Increase(dollars in millions)
    
    2009
    
    
    2008
    
    
    (Decrease)
    
    
    (Decrease)United States
    
    $
    508.1
    
    
    
    79.6
    %
    
    $
    683.7
    
    
    
    79.7
    %
    
    $
    (175.6
    )
    
    
    (25.7
    )Europe
    
    
    130.3
    
    
    
    20.4
    %
    
    
    174.2
    
    
    
    20.3
    %
    
    
    (43.9
    )
    
    
    (25.2
    )Total
    
    $
    638.4
    
    
    
    100.0
    %
    
    $
    857.9
    
    
    
    100.0
    %
    
    $
    (219.5
    )
    
    
    (25.6
    )
   Gross Profit
 December 31,
    
    
    Increase(dollars in millions)
    
    2009
    
    
    2008
    
    
    (Decrease)United States
    
    $
    25.5
    
    
    $
    36.2
    
    
    $
    (10.7
    )Europe
    
    
    5.8
    
    
    
    (1.0
    )
    
    
    6.8Total
    
    $
    31.3
    
    
    $
    35.2
    
    
    $
    (3.9
    )Percent of net sales
    
    
    4.9
    %
    
    
    4.1
    %
   Selling and Administrative Expenses
    22




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Research and Technology Expenses
  Provision for Restructuring
  Impairment of Intangible Assets
  Interest Expense
  Reorganization Items, Net
   Other Income (Expense), Net
   (Provision for) Benefit from Income Taxes
    23




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Liquidity and Capital Resources
 Cash Flow
 Year endedDecember 31,(dollars in millions)
    
    2009
    
    
    2008Net cash provided by operations
    
    $
    25.6
    
    
    $
    14.1Net cash used in investing activities
    
    $
    (21.9
    )
    
    $
    (23.5
    )Net cash
provided by (used in) financing activities
    
    $
    (15.6
    )
    
    $
    19.6
      (a)
    
    up to 85% of the dollar equivalent of the book value of eligible
accounts receivable; plus(b)
    
    subject to certain limitations, the lesser of (i) 65% of the dollar
equivalent of the book value of eligible inventory valued at the lower
of cost on a first-in, first-out basis or market, and (ii) up to 85%
of the dollar equivalent of the book value of the net orderly
liquidation value of eligible inventory; minus
  24




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(c)
    
    $2.5 million; minus(d)
    
    such reserves as the Agent may from time to time establish in its
discretion in connection with hedging arrangements; minus(e)
    
    such reserves as the Agent may from time to time establish in its
discretion in connection with eligibility criteria or otherwise.
        25




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
    
    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;
 
    
    non-cash compensation may be a part of our overall long-term incentive compensation
package, although we exclude it as an expense when evaluating our ongoing operating
performance for a particular period;
 
    
    Adjusted EBITDA does not reflect the impact of certain cash charges; and
 
    
    other companies may calculate Adjusted EBITDA differently than we do, limiting its
usefulness as a comparative measure.
 Reconciliation of net income to EBITDA
 Four QuartersEnded(in thousands)
    
    December 31, 2009Net income
    
    $
    89,086Interest expense
    
    
    28,845Income taxes
    
    
    25,991Depreciation and amortization
    
    
    42,871EBITDA
    
    $
    186,793
 Reconciliation of EBITDA to Adjusted EBITDA
 Four QuartersEnded(in thousands)
    
    December 31, 2009EBITDA
    
    $
    186,793Cash restructuring charges
    
    
    2,232Cash reorganization charges
    
    
    9,661Gain from discharge of debt
    
    
    (84,745
    )Gain from fresh-start accounting adjustments
    
    
    (68,109
    )Other non-cash charges (i)
    
    
    1,271Adjusted EBITDA
    
    $
    47,103
 (i)
    
    Includes foreign currency translation gains/losses and non-cash charges.  26




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Capital Expenditures
  
    
    Purchase of new molds and refurbishment of existing molds for new customer awards;
 
    
    Acquisition of new equipment for productivity improvement and capacity expansion
primarily in custom products;
 
    
    Costs associated with implementing restructuring plans; and,
 
    
    Maintenance and upgrade of facilities.
  Pension Funding
    27




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Critical Accounting Policies and Estimates
  Impairment of Long-Lived Assets
    Goodwill Impairment
    28




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Impairment of Indefinite-Lived Intangible Assets
  Defined Benefit Pension Plans
    Inventory
   29




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Income Taxes
  Self-Insurance
   Recent Accounting Pronouncements
  Fair Value Measurements and
Disclosures
  30




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Business Combinations. Reorganizations
  Compensation 
Retirement Benefits
  31




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ITEM 8.
    
    FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 CONSTAR INTERNATIONAL INC.
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND FINANCIAL STATEMENT SCHEDULES
 Managements Report on Internal Control over Financial Reporting
    
    
    33Reports of Independent Registered Public Accounting Firm
    
    
    34Consolidated Balance Sheets
    
    
    36Consolidated Statements of Operations
    
    
    37Consolidated Statements of Cash Flows
    
    
    38Consolidated Statements of Stockholders Equity (Deficit)
    
    
    39Notes to Consolidated Financial Statements
    
    
    40Financial Statement SchedulesSchedule IIValuation and Qualifying Accounts and Reserves
    
    
    85
   32




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Managements Reports on Responsibility for Financial Statements and
Internal Control over Financial Reporting
 Managements Report on Responsibility for Financial Statements
  Managements Report on Internal Control over Financial Reporting
  i.
    
    pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the
transactions and dispositions of the assets of the
Company;ii.
    
    provide reasonable assurance that transactions are
recorded as necessary to permit preparation of
financial statements in accordance with GAAP and
that receipts and expenditures of the Company are
being made only in accordance with authorization of
management and directors of the company; andiii.
    
    provide reasonable assurance regarding prevention
or timely detection of unauthorized acquisitions,
use or disposition of the Companys assets that
could have a material effect on the financial
statements.
  Internal Control-Integrated Framework
  /s/ Michael J. Hoffman
    
    
    
    /s/ J. Mark BorsethMichael J. Hoffman
    
    
    
    J. Mark BorsethPresident and Chief Executive Officer
    
    
    
    Executive Vice President andChief
Financial Officer
   33




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  Internal Control  Integrated Framework
    /s/ PricewaterhouseCoopers LLP
 
  34




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##### Table of Contents



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
    /s/ PricewaterhouseCoopers LLP
 
  35




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##### Table of Contents



Constar International Inc.
 
 Consolidated Balance Sheets  (In thousands, except par value)
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,2009
    
    
    
    2008ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    2,469
    
    
    
    $
    14,292Accounts receivable, net
    
    
    39,054
    
    
    
    
    45,695Accounts receivable  related party
    
    
    
    
    
    
    
    109Inventories, net
    
    
    44,058
    
    
    
    
    49,765Prepaid expenses and other current assets
    
    
    7,896
    
    
    
    
    24,649Restricted cash
    
    
    7,589
    
    
    
    
    Deferred income taxes
    
    
    
    
    
    
    
    896Total current assets
    
    
    101,066
    
    
    
    
    135,406Property, plant and equipment, net
    
    
    151,526
    
    
    
    
    132,371Goodwill and intangible assets, net
    
    
    150,080
    
    
    
    
    148,813Other assets
    
    
    3,592
    
    
    
    
    1,626Total assets
    
    $
    406,264
    
    
    
    $
    418,216LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Short-term debt
    
    $
    5,000
    
    
    
    $
    20,000Current portion of long-term debt
    
    
    
    
    
    
    
    220,000Accounts payable
    
    
    59,128
    
    
    
    
    61,747Accrued expenses and other current liabilities
    
    
    25,253
    
    
    
    
    30,081Deferred income taxes
    
    
    1,222
    
    
    
    
    Accounts payable and accrued expenses  related party
    
    
    
    
    
    
    
    3,765Total current liabilities
    
    
    90,603
    
    
    
    
    335,593Long term debt, net of current portion
    
    
    167,919
    
    
    
    
    Pension and postretirement liabilities
    
    
    31,105
    
    
    
    
    38,512Deferred income taxes
    
    
    23,531
    
    
    
    
    896Other liabilities
    
    
    14,503
    
    
    
    
    18,088Liabilities subject to compromise
    
    
    
    
    
    
    
    186,229Total liabilities
    
    
    327,661
    
    
    
    
    579,318Commitments and contingencies (Note 19)Stockholders Equity (Deficit):Predecessor preferred stock, $.01 par value  none issued or
outstanding at December 31, 2008
    
    
    
    
    
    
    
    Predecessor common stock, $.01 par value  13,297 shares issued,
12,922 shares outstanding at December 31, 2008
    
    
    
    
    
    
    
    125Successor common stock, $.01 par value, 75,000 shares authorized,
1,750 shares issued and outstanding at December 31, 2009
    
    
    18
    
    
    
    
    Additional paid-in capital
    
    
    101,466
    
    
    
    
    277,371Accumulated other comprehensive loss, net of tax
    
    
    (1,769
    )
    
    
    
    (50,317
    )Predecessor treasury stock, at cost  375 shares at December 31, 2008
    
    
    
    
    
    
    
    (1,033
    )Accumulated deficit
    
    
    (21,112
    )
    
    
    
    (387,248
    )Total stockholders equity (deficit)
    
    
    78,603
    
    
    
    
    (161,102
    )Total liabilities and stockholders equity (deficit)
    
    $
    406,264
    
    
    
    $
    418,216
   36




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##### Table of Contents



Constar International Inc.
 
 Consolidated Statements of Operations  (In thousands, except per share data)
 Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,2009
    
    
    
    2009
    
    
    2008Net customer sales
    
    $
    421,187
    
    
    
    $
    213,925
    
    
    $
    850,740Net affiliate sales
    
    
    
    
    
    
    
    3,256
    
    
    
    7,129Net sales
    
    
    421,187
    
    
    
    
    217,181
    
    
    
    857,869Cost of products sold, excluding depreciation and amortization
    
    
    374,680
    
    
    
    
    189,537
    
    
    
    789,861Depreciation and amortization
    
    
    33,138
    
    
    
    
    9,733
    
    
    
    32,811Gross profit
    
    
    13,369
    
    
    
    
    17,911
    
    
    
    35,197Selling and administrative expenses
    
    
    13,019
    
    
    
    
    7,005
    
    
    
    22,745Research and technology expenses
    
    
    5,284
    
    
    
    
    2,698
    
    
    
    8,536Provision for restructuring
    
    
    1,584
    
    
    
    
    648
    
    
    
    4,811Impairment of intangible assets
    
    
    4,000
    
    
    
    
    
    
    
    
    Gain on disposal of assets
    
    
    (427
    )
    
    
    
    (396
    )
    
    
    (1,227
    )Total operating expenses
    
    
    23,460
    
    
    
    
    9,955
    
    
    
    34,865Operating income (loss)
    
    
    (10,091
    )
    
    
    
    7,956
    
    
    
    332Interest expense
    
    
    (23,279
    )
    
    
    
    (5,512
    )
    
    
    (38,412
    )Interest expense  related party
    
    
    
    
    
    
    
    (54
    )
    
    
    (244
    )Reorganization items, net
    
    
    (1,906
    )
    
    
    
    144,168
    
    
    
    (9,190
    )Other income (expense), net
    
    
    2,433
    
    
    
    
    1,543
    
    
    
    (10,711
    )Income (loss) from continuing operations before income taxes
    
    
    (32,843
    )
    
    
    
    148,101
    
    
    
    (58,225
    )(Provision for) benefit from income taxes
    
    
    11,816
    
    
    
    
    (37,807
    )
    
    
    447Income (loss) from continuing operations
    
    
    (21,027
    )
    
    
    
    110,294
    
    
    
    (57,778
    )Loss from discontinued operations, net of taxes
    
    
    (85
    )
    
    
    
    (96
    )
    
    
    (57
    )Net income (loss)
    
    $
    (21,112
    )
    
    
    $
    110,198
    
    
    $
    (57,835
    )Basic and diluted income (loss) per common share:Continuing operations
    
    $
    (12.02
    )
    
    
    $
    8.86
    
    
    $
    (4.66
    )Discontinued operations
    
    
    (0.04
    )
    
    
    
    (0.01
    )
    
    
    Net income (loss) per share
    
    $
    (12.06
    )
    
    
    $
    8.85
    
    
    $
    (4.66
    )Weighted average common shares outstanding:Basic and diluted
    
    
    1,750
    
    
    
    
    12,455
    
    
    
    12,403
   37




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##### Table of Contents



Constar International Inc.
 
 Consolidated Statements of Cash Flows  (In thousands)
 Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,2009
    
    
    
    2009
    
    
    2008Cash flows from operating activities:Net income (loss)
    
    $
    (21,112
    )
    
    
    $
    110,198
    
    
    $
    (57,835
    )Adjustments to reconcile net income (loss) to
net cash provided by operating activities:Depreciation and amortization
    
    
    33,139
    
    
    
    
    10,060
    
    
    
    35,160Debt accretion expense
    
    
    13,644
    
    
    
    
    
    
    
    
    Impairment of intangible asset
    
    
    4,000
    
    
    
    
    
    
    
    
    Bad debt expense (recovery)
    
    
    435
    
    
    
    
    (483
    )
    
    
    1,841Stock-based compensation
    
    
    
    
    
    
    
    591
    
    
    
    608Gain on disposal of assets
    
    
    (427
    )
    
    
    
    (396
    )
    
    
    (964
    )Non-cash reorganization costs
    
    
    
    
    
    
    
    
    
    
    
    3,851Deferred income taxes
    
    
    (11,800
    )
    
    
    
    37,835
    
    
    
    Changes in operating assets and liabilities:Accounts receivable
    
    
    20,177
    
    
    
    
    (11,480
    )
    
    
    9,119Inventories
    
    
    13,619
    
    
    
    
    (5,432
    )
    
    
    20,907Prepaid expenses and other current assets
    
    
    (786
    )
    
    
    
    977
    
    
    
    5,343Accounts payable
    
    
    (19,321
    )
    
    
    
    6,727
    
    
    
    (5,138
    )Change in book overdrafts
    
    
    (184
    )
    
    
    
    10,453
    
    
    
    (12,695
    )Accrued expenses and other current liabilities
    
    
    (15,771
    )
    
    
    
    4,905
    
    
    
    13,965Pension and postretirement benefits
    
    
    (587
    )
    
    
    
    954
    
    
    
    (571
    )Fresh start accounting adjustments
    
    
    
    
    
    
    
    (68,109
    )
    
    
    Reorganization items, net
    
    
    (6,893
    )
    
    
    
    (79,299
    )
    
    
    550Net cash provided by operating activities
    
    
    8,133
    
    
    
    
    17,501
    
    
    
    14,141Cash flows from investing activities:Restricted cash
    
    
    1,738
    
    
    
    
    (9,327
    )
    
    
    Purchases of property, plant and equipment
    
    
    (8,793
    )
    
    
    
    (5,723
    )
    
    
    (25,322
    )Proceeds from sale of property, plant, and equipment
    
    
    9
    
    
    
    
    149
    
    
    
    1,852Net cash used in investing activities
    
    
    (7,046
    )
    
    
    
    (14,901
    )
    
    
    (23,470
    )Cash flows from financing activities:Costs associated with debt
    
    
    (575
    )
    
    
    
    
    
    
    
    Proceeds from short-term financing
    
    
    458,000
    
    
    
    
    212,723
    
    
    
    779,096Repayment of short-term financing
    
    
    (458,000
    )
    
    
    
    (227,723
    )
    
    
    (759,534
    )Net cash provided by (used in) financing activities
    
    
    (575
    )
    
    
    
    (15,000
    )
    
    
    19,562Effect of exchange rate changes on cash and cash equivalents
    
    
    73
    
    
    
    
    (8
    )
    
    
    (195
    )Net increase (decrease) in cash and cash equivalents
    
    
    585
    
    
    
    
    (12,408
    )
    
    
    10,038Cash and cash equivalents at beginning of period
    
    
    1,884
    
    
    
    
    14,292
    
    
    
    4,254Cash and cash equivalents at end of period
    
    $
    2,469
    
    
    
    $
    1,884
    
    
    $
    14,292
   38




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##### Table of Contents



Constar International Inc.
 
 Consolidated Statements of Stockholders Equity (Deficit)  (In thousands)
 AccumulatedAdditional
    
    
    Other
    
    
    
    
    
    
    
    
    
    
    TotalCommon
    
    
    Paid-in
    
    
    Comprehensive
    
    
    Treasury
    
    
    Accumulated
    
    
    StockholdersStock
    
    
    Capital
    
    
    Income (Loss)
    
    
    Stock
    
    
    Deficit
    
    
    Equity (Deficit)Balance, December 31, 2007 (Predecessor)
    
    $
    125
    
    
    $
    276,546
    
    
    $
    (18,620
    )
    
    $
    (945
    )
    
    $
    (329,413
    )
    
    $
    (72,307
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (57,835
    )
    
    
    (57,835
    )Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    3,317
    
    
    
    
    
    
    
    
    
    
    
    3,317Amortization of prior service cost
    
    
    
    
    
    
    
    
    
    
    (290
    )
    
    
    
    
    
    
    
    
    
    
    (290
    )Amortization of actuarial net loss
    
    
    
    
    
    
    
    
    
    
    3,179
    
    
    
    
    
    
    
    
    
    
    
    3,179Pension and postretirement adjustment to funded status
    
    
    
    
    
    
    
    
    
    
    (25,655
    )
    
    
    
    
    
    
    
    
    
    
    (25,655
    )Pension curtailment adjustment
    
    
    
    
    
    
    
    
    
    
    (5,757
    )
    
    
    
    
    
    
    
    
    
    
    (5,757
    )Revaluation of cash flow hedge
    
    
    
    
    
    
    
    
    
    
    (6,491
    )
    
    
    
    
    
    
    
    
    
    
    (6,491
    )Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (89,532
    )Treasury stock purchased
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (88
    )
    
    
    
    
    
    
    (88
    )Issuance of common stock under benefit plans
    
    
    
    
    
    
    8
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    8Stock-based compensation
    
    
    
    
    
    
    817
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    817Balance, December 31, 2008 (Predecessor)
    
    
    125
    
    
    
    277,371
    
    
    
    (50,317
    )
    
    
    (1,033
    )
    
    
    (387,248
    )
    
    
    (161,102
    )Net income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    110,198
    
    
    
    110,198Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    (1,134
    )
    
    
    
    
    
    
    
    
    
    
    (1,134
    )Amortization of prior service cost
    
    
    
    
    
    
    
    
    
    
    (97
    )
    
    
    
    
    
    
    
    
    
    
    (97
    )Amortization of actuarial net loss
    
    
    
    
    
    
    
    
    
    
    2,016
    
    
    
    
    
    
    
    
    
    
    
    2,016Revaluation of cash flow hedge
    
    
    
    
    
    
    
    
    
    
    951
    
    
    
    
    
    
    
    
    
    
    
    951Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    111,934Stock-based compensation
    
    
    
    
    
    
    597
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    597Balance, April 30, 2009 (Predecessor)
    
    
    125
    
    
    
    277,968
    
    
    
    (48,581
    )
    
    
    (1,033
    )
    
    
    (277,050
    )
    
    
    (48,571
    )Fresh-Start Adjustments:Cancellation of Predecessor common stock and
elimination of Predecessor accumulated deficit
    
    
    (125
    )
    
    
    (277,968
    )
    
    
    
    
    
    
    1,033
    
    
    
    277,050
    
    
    
    (10
    )Elimination of Predecessor accumulated
other comprehensive loss
    
    
    
    
    
    
    
    
    
    
    48,581
    
    
    
    
    
    
    
    
    
    
    
    48,581Balance, May 1, 2009 (Predecessor)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Issuance of 1.75 million shares of
common stock in connection with
emergence from Chapter 11
    
    
    18
    
    
    
    101,466
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    101,484Balance, May 1, 2009 (Successor)
    
    
    18
    
    
    
    101,466
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    101,484Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,112
    )
    
    
    (21,112
    )Pension and postretirement adjustment to funded status
    
    
    
    
    
    
    
    
    
    
    (2,460
    )
    
    
    
    
    
    
    
    
    
    
    (2,460
    )Revaluation of cash flow hedge
    
    
    
    
    
    
    
    
    
    
    662
    
    
    
    
    
    
    
    
    
    
    
    662Foreign currency translation adjustments
    
    
    
    
    
    
    
    
    
    
    29
    
    
    
    
    
    
    
    
    
    
    
    29Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (22,881
    )Balance, December 31, 2009 (Successor)
    
    $
    18
    
    
    $
    101,466
    
    
    $
    (1,769
    )
    
    $
    
    
    
    $
    (21,112
    )
    
    $
    78,603
   39




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##### Table of Contents



Constar International Inc.
 
 Notes to Consolidated Financial Statements  (Amounts in thousands unless otherwise noted)
 1. Description of Business
  2. Emergence from Voluntary Reorganization Under Chapter 11 Proceedings
 Background In re Constar International Inc., et al.,
 Plan
of Reorganization
 
    
    Holders of Allowed Administrative Claims,
Priority Tax Claims, Other Priority Claims, and Other
Secured Claims would receive full payment in cash;
    
    The DIP Credit Facility would be converted into the Companys Exit Facility;
    
    Holders of Senior Secured Floating Rate Notes
would be deaccelerated and reinstated in full as of
the date immediately preceding the Petition Date;
    
    Holders of Other Secured Claims, except to the
extent that a Holder agrees otherwise, would receive
one of the following treatments, in full satisfaction,
settlement, release and discharge of and in exchange
for each Allowed Other Secured Claim, at the sole
discretion of the Debtors: (i) payment in full in
Cash; (ii) delivery of the collateral securing any
such Allowed Other Secured Claim; (iii) deacceleration
and reinstatement in full; or (iv) any other treatment
rendering the claim unimpaired;
    
    Holders of Senior Subordinated Notes would
receive 100% of the new Common Stock of the
reorganized Company (except for stock reserved for
incentive plans) in full satisfaction, settlement, and
release, and discharge of such notes;
    
    Holders of Allowed General Unsecured Claims would
receive full payment in cash in the ordinary course of
business;
    
    Section 510(b) Claims (which are subordinated
securities law claims as further described in the Plan
of Reorganization) would be extinguished; and
    
    Holders of our Common Stock would not receive any
distribution under the Plan of Reorganization and
their shares would be cancelled on the effective date
of the Plan of Reorganization.
 Confirmation and Consummation of the Plan of Reorganization
   40




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##### Table of Contents



Trading of Common Stock
 3. Summary of Significant Accounting Policies
 Basis of Presentation
 Reorganizations
     41




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##### Table of Contents



Principles of Consolidation
  Use of Estimates
  Business Combinations. Income
Taxes. Compensation  Retirement Benefits.
  Cash and Cash Equivalents
   Restricted Cash
  Revenue Recognition
    42




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##### Table of Contents



Trade Accounts Receivable and Allowance for Doubtful Accounts
  Inventories
  Property, Plant and Equipment
   (In Years)
    
    Successor
    
    PredecessorLand improvements
    
    25
    
    25Building and building improvements
    
    3 to 40
    
    25 to 40Machinery and equipment
    
    2 to 10
    
    10Furniture, computer equipment, and tools
    
    2 to 10
    
    5 to 10Molds
    
    Shorter of the useful life or contract term
    
    5Leasehold improvements
    
    Shorter of the useful life or lease term
    
    Shorter of the useful life or lease term
  Impairment of Long-Lived Assets
  Goodwill and Intangible Assets
   43




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##### Table of Contents



Derivative Financial Instruments
  Restructuring
  Asset Retirement Obligations
  Reserves for Self Insurance
   44




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##### Table of Contents



Deferred Financing Costs
  Foreign Currency Translation
   Shipping and Handling Costs
  Income Taxes
    Stock-Based Compensation
    45




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##### Table of Contents



Net Loss Per Share
    Research and Technology
  Concentration of Credit Risk
   Fair Value Measurements
       46




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##### Table of Contents



Recent Accounting Pronouncements
  Fair Value Measurements and
Disclosures
 Business Combinations. Reorganizations
  Compensation 
Retirement Benefits
 4. Fresh-Start Accounting
    47




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##### Table of Contents



Business Combinations Income Taxes. Compensation 
Retirement Benefits
    48




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##### Table of Contents



ReclassificationsPredecessor
    
    
    and
    
    
    Fresh Start
    
    
    SuccessorApril 30,
    
    
    Plan of
    
    
    Accounting
    
    
    May 1,(In thousands)
    
    2009
    
    
    Reorganization
    
    
    Adjustments
    
    
    2009ASSETSCurrent Assets:Cash and cash equivalents
    
    $
    1,884
    
    
    $
    
    
    
    $
    
    
    
    $
    1,884Accounts receivable, net
    
    
    48,021
    
    
    
    876
    a
    
    
    (26
    ) g
    
    
    48,871Accounts receivable  related party
    
    
    876
    
    
    
    (876
    ) a
    
    
    
    
    
    
    Inventories, net
    
    
    55,179
    
    
    
    
    
    
    
    1,621
    g
    
    
    56,800Prepaid expenses and other current assets
    
    
    23,626
    
    
    
    (13,870
    ) b, k
    
    
    (1,132
    ) g
    
    
    8,624Deferred income taxes
    
    
    1,594
    
    
    
    
    
    
    
    (714
    ) i
    
    
    880Current assets of discontinued operations
    
    
    310
    
    
    
    
    
    
    
    
    
    
    
    310Total current assets
    
    
    131,490
    
    
    
    (13,870
    )
    
    
    (251
    )
    
    
    117,369Property, plant and equipment, net
    
    
    128,938
    
    
    
    11,216
    k
    
    
    37,385
    g
    
    
    177,539Goodwill
    
    
    148,813
    
    
    
    
    
    
    
    (31,500
    ) g, h
    
    
    117,313Intangible assets
    
    
    
    
    
    
    
    
    
    
    36,404
    g, h
    
    
    36,404Restricted cash
    
    
    9,327
    
    
    
    
    
    
    
    
    
    
    
    9,327Other assets
    
    
    1,265
    
    
    
    2,654
    b
    
    
    (2,654
    ) g
    
    
    1,265Total assets
    
    $
    419,833
    
    
    $
    
    
    
    $
    39,384
    
    
    $
    459,217LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Short-term debt
    
    $
    5,000
    
    
    $
    
    
    
    $
    
    
    
    $
    5,000Current portion of long-term debt
    
    
    220,000
    
    
    
    (220,000
    ) b
    
    
    
    
    
    
    Accounts payable
    
    
    83,407
    
    
    
    850
    a
    
    
    
    
    
    
    84,257Accrued expenses and other current liabilities
    
    
    27,165
    
    
    
    4,148
    a, c, d
    
    
    (459
    ) g
    
    
    30,854Accounts payable and accrued expenses  related party
    
    
    4,108
    
    
    
    (4,108
    ) a
    
    
    
    
    
    
    Deferred income taxes
    
    
    1,594
    
    
    
    
    
    
    
    (1,594
    ) i
    
    
    Current liabilities of discontinued operations
    
    
    131
    
    
    
    
    
    
    
    
    
    
    
    131Total current liabilities
    
    
    341,405
    
    
    
    (219,110
    )
    
    
    (2,053
    )
    
    
    120,242Long-term debt, net of current portion
    
    
    
    
    
    
    220,000
    b
    
    
    (65,725
    ) g
    
    
    154,275Pension and postretirement liabilities
    
    
    37,545
    
    
    
    (367
    ) d
    
    
    (7,424
    ) g
    
    
    29,754Deferred income taxes
    
    
    
    
    
    
    
    
    
    
    38,715
    i
    
    
    38,715Other liabilities
    
    
    16,919
    
    
    
    
    
    
    
    (2,984
    ) g
    
    
    13,935Non-current liabilities of discontinued operations
    
    
    812
    
    
    
    
    
    
    
    
    
    
    
    812Liabilities subject to compromise
    
    
    186,229
    
    
    
    (186,229
    ) e
    
    
    
    
    
    
    Total liabilities
    
    
    582,910
    
    
    
    (185,706
    )
    
    
    (39,471
    )
    
    
    357,733Commitments and contingenciesStockholders Equity (Deficit):Predecessor preferred stock
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Predecessor common stock
    
    
    125
    
    
    
    (125
    ) f
    
    
    
    
    
    
    Predecessor additional paid-in capital
    
    
    277,968
    
    
    
    (277,968
    ) f
    
    
    
    
    
    
    Predecessor treasury stock
    
    
    (1,033
    )
    
    
    1,033
    f
    
    
    
    
    
    
    Successor common stock
    
    
    
    
    
    
    18
    e
    
    
    
    
    
    
    18Successor additional paid-in capital
    
    
    
    
    
    
    101,466
    e
    
    
    
    
    
    
    101,466Accumulated other comprehensive loss, net of tax
    
    
    (48,581
    )
    
    
    
    
    
    
    48,581
    j
    
    
    Accumulated deficit
    
    
    (391,556
    )
    
    
    361,282
    c, e, f
    
    
    30,274
    j
    
    
    Total stockholders equity (deficit)
    
    
    (163,077
    )
    
    
    185,706
    
    
    
    78,855
    
    
    
    101,484Total liabilities and stockholders equity (deficit)
    
    $
    419,833
    
    
    $
    
    
    
    $
    39,384
    
    
    $
    459,217
  49




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##### Table of Contents



Notes to Plan of Reorganization and fresh-start accounting adjustments (in thousands,
unless otherwise noted)
 (a)
    
    At April 30, 2009, Crown Holdings, Inc. (Crown) owned approximately 10% of the Predecessor
Companys outstanding common stock. As of May 1, 2009, as a result of the cancellation of the
Predecessor Companys common stock, Crown is no longer considered a related party. This
adjustment reflects the reclassification of amounts formerly classified as related party
transactions.(b)
    
    These adjustments reflect the reclassification to long-term debt of the $220 million Senior
Notes that had been classified as a current liability on the Predecessor Companys balance
sheet due to the Chapter 11 proceedings and the reclassification of the related deferred
financing fees from current assets to non-current assets.(c)
    
    This adjustment reflects an accrual of $523 thousand for costs related to a contract that was
rejected as part of the Chapter 11 proceedings.(d)
    
    As a result of the termination of the Supplemental Executive Retirement Plan the Company
reclassified the outstanding liability under the plan to current liabilities. The liability
was paid in full in June 2009.(e)
    
    This adjustment reflects the discharge of $186.2 million of liabilities subject to compromise
in accordance with the terms of the Plan of Reorganization and the issuance of 1.75 million shares
of Successor Company common stock to the holders of Senior Subordinated Notes in satisfaction of
such claims.(f)
    
    This adjustment reflects the cancellation of the Predecessor Companys common stock.(g)
    
    To record assets and liabilities at their estimated fair values: (In thousands)Accounts receivable
    
    $
    (26
    )Inventories
    
    
    1,621Prepaid expenses and other current assets
    
    
    (1,132
    )Property, plant, and equipment
    
    
    37,385Goodwill
    
    
    (80,081
    )Intangible assets
    
    
    36,404Other assets
    
    
    (2,654
    )Accrued expenses and other current liabilities
    
    
    459Long-term debt
    
    
    65,725Pension and postretirement liabilities
    
    
    7,424Other liabilities
    
    
    2,984Gain on fresh start adjustments before tax
    
    
    68,109Elimination of other comprehensive income
    
    
    48,581Less: tax effect on fresh-start adjustments
    
    
    (37,835
    )Total change in equity
    
    $
    78,855
 (h)
    
    To eliminate Predecessor goodwill.(i)
    
    To adjust deferred taxes to reflect the impact of fresh-start accounting fair value
adjustments.(j)
    
    To reset accumulated other comprehensive loss and accumulated deficit to zero.(k)
    
    To reclassify pallets used for shipping products to customers from prepaid expenses to
property, plant, and equipment.   50




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##### Table of Contents



5. Liabilities Subject to Compromise and Reorganization Items
   Predecessor(In thousands)
    
    December 31, 2008Subordinated Notes
    
    $
    175,000Accrued interest on Subordinated Notes
    
    
    11,229$
    186,229
   Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2009
    
    
    2008Gain from discharge of debt
    
    $
    
    
    
    
    $
    84,745
    
    
    $
    Gain from fresh-start accounting adjustments
    
    
    
    
    
    
    
    68,109
    
    
    
    Contract termination expenses
    
    
    
    
    
    
    
    (523
    )
    
    
    Professional fees associated with bankruptcy proceedings
    
    
    (1,775
    )
    
    
    
    (6,905
    )
    
    
    (2,795
    )Write-off of debt issuance costs related to debt subject to compromise
    
    
    
    
    
    
    
    
    
    
    
    (2,041
    )Write-off of debt discount on debt subject to compromise
    
    
    
    
    
    
    
    
    
    
    
    (1,005
    )Write-off of debt issuance costs associated with Revolver Loan
    
    
    
    
    
    
    
    
    
    
    
    (805
    )DIP and Exit Financing fees
    
    
    
    
    
    
    
    (100
    )
    
    
    (2,268
    )Other, net
    
    
    (131
    )
    
    
    
    (1,158
    )
    
    
    (276
    )Reorganization items, net
    
    $
    (1,906
    )
    
    
    $
    144,168
    
    
    $
    (9,190
    )
   51




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##### Table of Contents



6. Accounts Receivable
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Trade accounts receivable
    
    $
    35,427
    
    
    
    $
    40,796Less: allowance for doubtful accounts
    
    
    (322
    )
    
    
    
    (1,904
    )Net trade accounts receivable
    
    
    35,105
    
    
    
    
    38,892Value added taxes recoverable
    
    
    2,202
    
    
    
    
    4,331Miscellaneous receivables
    
    
    1,747
    
    
    
    
    2,472Total
    
    $
    39,054
    
    
    
    $
    45,695
  7. Inventories
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Finished goods
    
    $
    27,715
    
    
    
    $
    34,021Raw materials and supplies
    
    
    16,343
    
    
    
    
    15,744Total
    
    $
    44,058
    
    
    
    $
    49,765
  8. Property, Plant and Equipment
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Land and improvements
    
    $
    15,812
    
    
    
    $
    3,438Buildings and improvements
    
    
    50,708
    
    
    
    
    93,405Machinery and equipment
    
    
    121,975
    
    
    
    
    578,062188,495
    
    
    
    
    674,905Less: accumulated depreciation and amortization
    
    
    (40,303
    )
    
    
    
    (545,647
    )148,192
    
    
    
    
    129,258Construction in progress
    
    
    3,334
    
    
    
    
    3,113Property, plant and equipment, net
    
    $
    151,526
    
    
    
    $
    132,371
    52




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##### Table of Contents



9. Other Assets
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Deposits
    
    $
    1,294
    
    
    
    $
    1,003Contract acquisition fees
    
    
    940
    
    
    
    
    Deferred financing costs, net
    
    
    552
    
    
    
    
    Supplies
    
    
    342
    
    
    
    
    112Other
    
    
    464
    
    
    
    
    511Total
    
    $
    3,592
    
    
    
    $
    1,626
 10. Goodwill and Intangible Assets
  1.
    
    Income Approach (discounted cash flow analysis) the discounted cash flow (DCF)
valuation method requires an estimation of future cash flows of an entity and then
discounting those cash flows to their present value using an appropriate discount rate.
The discount rate selected should reflect the risks inherent in the projected cash flows.
The key inputs and assumptions of the DCF method are the projected cash flows, the
terminal value of the entity, and the discount rate. The Company used the Gordon Growth
Model and assumed a 3% growth rate to estimate the terminal value of the business. Cash
flows were discounted at a rate of 10.4%.
 2.
    
    Market Approach (market multiples) this method begins with the identification of a
group of peer companies. Peer companies represent a group of companies in the same or
similar industry as the company being valued. A valuation average multiple is then
computed for the peer group based upon a valuation metric. The Company selected a ratio of
enterprise value to projected earnings before interest, taxes, depreciation and
amortization (EBITDA) as an appropriate valuation multiple. Various operating
performance measurements of the company being valued are then benchmarked against the peer
group and a discount or premium is applied to reflect favorable or unfavorable
comparisons. The resulting multiple is then applied to the company being valued to arrive
at an estimate of its fair value. An equity value is then derived by subtracting the fair
value of interest bearing debt from the total enterprise value. A control premium is then
applied to the equity value. The combined value of interest bearing debt plus an equity
value including control premium equals the estimated total, or enterprise value, of the
business. The Company selected 11 public companies in the packaging industry as its peer
group. The Company calculated for the peer group an average multiple of 2010 projected
EBITDA and a multiple of projected 2011 EBITDA. The peer group average multiples were then
discounted approximately 10% based upon an unfavorable comparison of the Companys
historical growth and profit margins as compared to the peer group. The result was a
market multiple of 5.3 for 2010 and a market multiple of 4.7 for 2011. A weighting of 80%
and 20% were assigned to the 2010 and 2011 valuation multiples, respectively. The company
used quoted market prices to determine the fair value of its debt at October 1, 2009. A
control premium of 20% was assumed to determine the Companys equity value.
   53




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##### Table of Contents



(In millions)Assumed
    
    Decrease inValuation Method
    
    Assumption
    
    Change
    
    Fair ValueDiscounted cash flow
    
    Projected cash flows
    
    10% decrease
    
    $
    (14.4
    )Discounted cash flow
    
    Terminal year growth rate
    
    100 basis point decrease
    
    $
    (9.4
    )Discounted cash flow
    
    Discount rate
    
    100 basis point increase
    
    $
    (6.5
    )Market approach
    
    Projected cash flows
    
    10% decrease
    
    $
    (16.7
    )Market approach
    
    Market multiple
    
    20% discount to peer average
    
    $
    (18.0
    )Market approach
    
    Control premium
    
    10% control premium
    
    $
    (4.1
    )
       54




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##### Table of Contents



Successor
    
    
    
    
    
    PredecessorEight Months
    
    
    April 30, 2009Ended
    
    
    Fresh-start
    
    
    Four Months
    
    
    Year EndedDecember 31,
    
    
    Accounting
    
    
    Ended April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    Adjustments
    
    
    2009
    
    
    2008Beginning balance:Goodwill
    
    $
    117,313
    
    
    $
    381,872
    
    
    $
    381,872
    
    
    $
    381,872Accumulated impairment losses
    
    
    
    
    
    
    (233,059
    )
    
    
    (233,059
    )
    
    
    (233,059
    )117,313
    
    
    
    148,813
    
    
    
    148,813
    
    
    
    148,813Adjustments during the period:Fresh-start accounting adjustments, net
    
    
    
    
    
    
    (31,500
    )
    
    
    
    
    
    
    Correction of errors (see note 4)
    
    
    1,369Ending balance:Goodwill
    
    
    118,682
    
    
    
    117,313
    
    
    
    381,872
    
    
    
    381,872Accumulated impairment losses
    
    
    
    
    
    
    
    
    
    
    (233,059
    )
    
    
    (233,059
    )$
    118,682
    
    
    $
    117,313
    
    
    $
    148,813
    
    
    $
    148,813
  Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Trade name
    
    
    25,500
    
    
    
    
    Accumulated impairment losses
    
    
    (4,000
    )
    
    
    
    Total
    
    $
    21,500
    
    
    
    $
    
  SuccessorDecember 31, 2009Estimated
    
    GrossLife
    
    Carrying
    
    
    Accumulated
    
    
    Net Book(In thousands)
    
    (in years)
    
    Amount
    
    
    Amortization
    
    
    ValueTechnology
    
    4 to 12
    
    $
    9,700
    
    
    $
    (805
    )
    
    $
    8,895Leasehold interests
    
    4
    
    
    1,204
    
    
    
    (201
    )
    
    
    1,003Total
    
    
    
    $
    10,904
    
    
    $
    (1,006
    )
    
    $
    9,898
   (In thousands)2010
    
    $
    1,5092011
    
    
    1,5092012
    
    
    1,5092013
    
    
    9092014
    
    
    608After 2014
    
    
    3,854$
    9,898
  55




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##### Table of Contents



11. Accrued Expenses and Other Current Liabilities
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Salaries, benefits, and other employee costs
    
    $
    6,235
    
    
    
    $
    10,005Value added taxes
    
    
    4,015
    
    
    
    
    4,824Interest
    
    
    1,610
    
    
    
    
    1,870Other accrued taxes
    
    
    1,865
    
    
    
    
    2,120Asset retirement obligations (See Note 17)
    
    
    1,264
    
    
    
    
    2,163Customer incentives
    
    
    1,491
    
    
    
    
    Other current liabilities
    
    
    8,773
    
    
    
    
    9,099Total
    
    $
    25,253
    
    
    
    $
    30,081
 12. Debt
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Short-term:Exit Facility
    
    $
    5,000
    
    
    
    $
    Revolver
    
    
    
    
    
    
    
    20,000Total short-tem debt
    
    $
    5,000
    
    
    
    $
    20,000Long-term:Secured Notes
    
    $
    167,919
    
    
    
    $
    220,000Less current portion
    
    
    
    
    
    
    
    (220,000
    )Long-term debt, net of current portion
    
    $
    167,919
    
    
    
    $
    
    (a)
    
    up to 85% of the dollar equivalent of the book value
of eligible accounts receivable; plus(b)
    
    subject to certain limitations, the lesser of
(i) 65% of the dollar equivalent of the book value
of eligible inventory valued at the lower of cost on
a first-in, first-out basis or market, and (ii) up
to 85% of the dollar equivalent of the book value of
the net orderly liquidation value of eligible
inventory; minus(c)
    
    $2.5 million; minus(d)
    
    such reserves as the Agent may from time to time
establish in its discretion in connection with
hedging arrangements; minus(e)
    
    such reserves as the Agent may from time to time
establish in its discretion in connection with
eligibility criteria or otherwise.
  56




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##### Table of Contents



57




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##### Table of Contents



13. Other Liabilities
 Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Interest rate swap (see Note 26)
    
    $
    6,485
    
    
    
    $
    8,512Asset retirement obligations (see Note 17)
    
    
    4,278
    
    
    
    
    3,665Post-employment benefits
    
    
    1,308
    
    
    
    
    1,623Deferred rent
    
    
    966
    
    
    
    
    3,435Non-current liabilities of discontinued operations
    
    
    881
    
    
    
    
    773Other
    
    
    585
    
    
    
    
    80$
    14,503
    
    
    
    $
    18,088
  14. Restructuring and Other Related Charges
      58




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##### Table of Contents



2007 Plan
    
    
    2008 PlansSeverance
    
    
    Contract
    
    
    
    
    
    
    Contract
    
    
    Severanceand
    
    
    and Lease
    
    
    
    
    
    
    and Lease
    
    
    andTermination
    
    
    Termination
    
    
    Other
    
    
    Termination
    
    
    Termination
    
    
    OtherBenefits
    
    
    Costs
    
    
    Costs
    
    
    Costs
    
    
    Benefits
    
    
    Costs
    
    
    TotalBalance, January 1, 2008 (Predecessor)
    
    $
    228
    
    
    $
    488
    
    
    $
    228
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    944Charges to income
    
    
    
    
    
    
    262
    
    
    
    
    
    
    
    553
    
    
    
    1,539
    
    
    
    823
    
    
    
    3,177Payments
    
    
    (216
    )
    
    
    (586
    )
    
    
    (229
    )
    
    
    (308
    )
    
    
    (921
    )
    
    
    (802
    )
    
    
    (3,062
    )Adjustments
    
    
    2
    
    
    
    (164
    )
    
    
    1
    
    
    
    (118
    )
    
    
    (64
    )
    
    
    
    
    
    
    (343
    )Balance, December 31, 2008 (Predecessor)
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    127
    
    
    
    554
    
    
    
    21
    
    
    
    716Charges to income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    320
    
    
    
    34
    
    
    
    298
    
    
    
    652Payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (336
    )
    
    
    (451
    )
    
    
    (238
    )
    
    
    (1,025
    )Adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    April 30, 2009 (Predecessor)
    
    
    14
    
    
    
    
    
    
    
    
    
    
    
    111
    
    
    
    137
    
    
    
    81
    
    
    
    343Charges to income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    320
    
    
    
    45
    
    
    
    1,277
    
    
    
    1,642Payments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (385
    )
    
    
    (116
    )
    
    
    (1,029
    )
    
    
    (1,530
    )Adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (66
    )
    
    
    
    
    
    
    (66
    )December 31, 2009 (Successor)
    
    $
    14
    
    
    $
    
    
    
    $
    
    
    
    $
    46
    
    
    $
    
    
    
    $
    329
    
    
    $
    389
  15. Pension and Postretirement Benefits
       59




---



##### Table of Contents



Successor
    
    
    
    Predecessor
    
    
    PredecessorEight Months Ended
    
    
    
    Four Months Ended
    
    
    Year EndedDecember 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2008(In thousands)
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    U.S.
    
    
    Europe
    
    
    TotalService cost
    
    $
    355
    
    
    $
    363
    
    
    $
    718
    
    
    
    $
    207
    
    
    $
    168
    
    
    $
    375
    
    
    $
    667
    
    
    $
    653
    
    
    $
    1,320Interest cost
    
    
    3,530
    
    
    
    430
    
    
    
    3,960
    
    
    
    
    1,752
    
    
    
    171
    
    
    
    1,923
    
    
    
    5,250
    
    
    
    649
    
    
    
    5,899Expected return on plan assets
    
    
    (3,028
    )
    
    
    (395
    )
    
    
    (3,423
    )
    
    
    
    (1,504
    )
    
    
    (168
    )
    
    
    (1,672
    )
    
    
    (6,021
    )
    
    
    (856
    )
    
    
    (6,877
    )Recognized actuarial loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,585
    
    
    
    106
    
    
    
    1,691
    
    
    
    2,171
    
    
    
    224
    
    
    
    2,395Recognized prior service costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18
    
    
    
    (12
    )
    
    
    6
    
    
    
    59
    
    
    
    (42
    )
    
    
    17Curtailment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    39
    
    
    
    
    
    
    
    39Total pension expense
    
    $
    857
    
    
    $
    398
    
    
    $
    1,255
    
    
    
    $
    2,058
    
    
    $
    265
    
    
    $
    2,323
    
    
    $
    2,165
    
    
    $
    628
    
    
    $
    2,793
  Successor
    
    
    
    PredecessorEight Months Ended
    
    
    
    Four Months Ended
    
    
    Year EndedDecember 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2008(In thousands)
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    U.S.
    
    
    Europe
    
    
    TotalChange in Benefit Obligation:Benefit obligation at beginning of period
    
    $
    74,617
    
    
    $
    9,795
    
    
    $
    84,412
    
    
    
    $
    84,192
    
    
    $
    9,784
    
    
    $
    93,976
    
    
    $
    76,960
    
    
    $
    12,457
    
    
    $
    89,417Service cost
    
    
    355
    
    
    
    363
    
    
    
    718
    
    
    
    
    207
    
    
    
    179
    
    
    
    386
    
    
    
    667
    
    
    
    653
    
    
    
    1,320Interest cost
    
    
    3,530
    
    
    
    430
    
    
    
    3,960
    
    
    
    
    1,752
    
    
    
    185
    
    
    
    1,937
    
    
    
    5,250
    
    
    
    649
    
    
    
    5,899Actuarial (gain) loss
    
    
    11,887
    
    
    
    2,631
    
    
    
    14,518
    
    
    
    
    (10,313
    )
    
    
    (194
    )
    
    
    (10,507
    )
    
    
    4,780
    
    
    
    (539
    )
    
    
    4,241Participant contributions
    
    
    
    
    
    
    152
    
    
    
    152
    
    
    
    
    
    
    
    
    62
    
    
    
    62
    
    
    
    
    
    
    
    274
    
    
    
    274Benefits paid
    
    
    (2,852
    )
    
    
    (369
    )
    
    
    (3,221
    )
    
    
    
    (1,221
    )
    
    
    (323
    )
    
    
    (1,544
    )
    
    
    (3,465
    )
    
    
    (482
    )
    
    
    (3,947
    )Foreign currency translation
    
    
    
    
    
    
    1,000
    
    
    
    1,000
    
    
    
    
    
    
    
    
    102
    
    
    
    102
    
    
    
    
    
    
    
    (3,228
    )
    
    
    (3,228
    )Benefit obligation at end of period
    
    
    87,537
    
    
    
    14,002
    
    
    
    101,539
    
    
    
    
    74,617
    
    
    
    9,795
    
    
    
    84,412
    
    
    
    84,192
    
    
    
    9,784
    
    
    
    93,976Change in Plan Assets:Fair value of plan assets at beginning of period
    
    
    54,034
    
    
    
    6,608
    
    
    
    60,642
    
    
    
    
    53,765
    
    
    
    6,610
    
    
    
    60,375
    
    
    
    73,188
    
    
    
    10,567
    
    
    
    83,755Actual returns on plan assets
    
    
    11,664
    
    
    
    1,895
    
    
    
    13,559
    
    
    
    
    462
    
    
    
    (426
    )
    
    
    36
    
    
    
    (18,998
    )
    
    
    (2,252
    )
    
    
    (21,250
    )Employer contributions
    
    
    1,677
    
    
    
    382
    
    
    
    2,059
    
    
    
    
    1,028
    
    
    
    581
    
    
    
    1,609
    
    
    
    3,040
    
    
    
    963
    
    
    
    4,003Participant contributions
    
    
    
    
    
    
    152
    
    
    
    152
    
    
    
    
    
    
    
    
    62
    
    
    
    62
    
    
    
    
    
    
    
    274
    
    
    
    274Benefits paid
    
    
    (2,852
    )
    
    
    (369
    )
    
    
    (3,221
    )
    
    
    
    (1,221
    )
    
    
    (323
    )
    
    
    (1,544
    )
    
    
    (3,465
    )
    
    
    (482
    )
    
    
    (3,947
    )Foreign currency rate changes
    
    
    
    
    
    
    677
    
    
    
    677
    
    
    
    
    
    
    
    
    104
    
    
    
    104
    
    
    
    
    
    
    
    (2,460
    )
    
    
    (2,460
    )Fair value of plan assets at end of period
    
    
    64,523
    
    
    
    9,345
    
    
    
    73,868
    
    
    
    
    54,034
    
    
    
    6,608
    
    
    
    60,642
    
    
    
    53,765
    
    
    
    6,610
    
    
    
    60,375Funded status at end of period
    
    $
    23,014
    
    
    $
    4,657
    
    
    $
    27,671
    
    
    
    $
    20,583
    
    
    $
    3,187
    
    
    $
    23,770
    
    
    $
    30,427
    
    
    $
    3,174
    
    
    $
    33,601
 Successor
    
    
    
    PredecessorDecember 31, 2009
    
    
    
    December 31, 2008(In thousands)
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    
    U.S.
    
    
    Europe
    
    
    TotalAmounts recognized on the
consolidated balance sheets:Current liability
    
    $
    48
    
    
    $
    516
    
    
    $
    564
    
    
    
    $
    64
    
    
    $
    
    
    
    $
    64Non-current liability
    
    
    22,966
    
    
    
    4,141
    
    
    
    27,107
    
    
    
    
    30,363
    
    
    
    3,174
    
    
    
    33,537Total liability
    
    $
    23,014
    
    
    $
    4,657
    
    
    $
    27,671
    
    
    
    $
    30,427
    
    
    $
    3,174
    
    
    $
    33,601Amounts recognized in accumulated other comprehensive income, pretax:Net actuarial losses
    
    $
    (3,251
    )
    
    $
    (1,130
    )
    
    $
    (4,381
    )
    
    
    $
    (55,952
    )
    
    $
    (6,079
    )
    
    $
    (62,031
    )Prior service costs
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (233
    )
    
    
    436
    
    
    
    203$
    (3,251
    )
    
    $
    (1,130
    )
    
    $
    (4,381
    )
    
    
    $
    (56,185
    )
    
    $
    (5,643
    )
    
    $
    (61,828
    )
   60




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##### Table of Contents



Successor
    
    
    
    PredecessorDecember 31, 2009
    
    
    
    December 31, 2008(In thousands)
    
    U.S.
    
    
    Europe
    
    
    Total
    
    
    
    U.S.
    
    
    Europe
    
    
    TotalFor all plans:Accumulated benefit obligation
    
    
    83,808
    
    
    
    10,174
    
    
    
    93,982
    
    
    
    
    80,595
    
    
    
    7,234
    
    
    
    87,829Plans with accumulated benefit
obligations in excess of plan assets:Projected benefit obligation
    
    
    87,537
    
    
    
    12,911
    
    
    
    100,448
    
    
    
    
    84,192
    
    
    
    9,784
    
    
    
    93,976Fair value of plan assets
    
    
    64,523
    
    
    
    9,345
    
    
    
    73,868
    
    
    
    
    53,765
    
    
    
    6,610
    
    
    
    60,375
 Assumptions
  Successor
    
    
    
    Predecessor2009
    
    
    
    2008U.S.
    
    
    Europe
    
    
    
    U.S.
    
    
    EuropeDiscount rate
    
    
    6.10
    %
    
    
    5.61
    %
    
    
    
    6.40
    %
    
    
    5.80
    %Rate of compensation increase
    
    
    3.00
    %
    
    
    4.22
    %
    
    
    
    3.00
    %
    
    
    3.92
    %
  Successor
    
    
    
    PredecessorYear ended
    
    
    
    For months ended
    
    
    Year endedDecember 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2008U.S.
    
    
    Europe
    
    
    
    U.S.
    
    
    Europe
    
    
    U.S.
    
    
    EuropeDiscount rate
    
    
    7.25
    %
    
    
    6.40
    %
    
    
    
    6.40
    %
    
    
    5.90
    %
    
    
    6.75
    %
    
    
    5.61
    %Rate of compensation increase
    
    
    3.00
    %
    
    
    3.86
    %
    
    
    
    3.00
    %
    
    
    3.87
    %
    
    
    3.00
    %
    
    
    3.90
    %Expected return on plan assets
    
    
    8.50
    %
    
    
    8.00
    %
    
    
    
    8.50
    %
    
    
    7.96
    %
    
    
    8.50
    %
    
    
    8.22
    %
     61




---



##### Table of Contents



Plan Assets
    Percentage of Plan Assetsat December 31,U.S. Plan Assets
    
    Target Allocation
    
    
    2009
    
    
    2008Equity securities
    
    50%-70%
    
    
    
    61
    %
    
    
    70
    %Debt securities
    
    30%-50%
    
    
    
    36
    %
    
    
    26
    %Other
    
    0%-3%
    
    
    
    3
    %
    
    
    4
    %Total
    
    
    
    
    
    
    100
    %
    
    
    100
    %
 Percentage of Plan Assetsat December 31,Europe Plan Assets
    
    2009
    
    
    2008Equity securities
    
    
    83
    %
    
    
    76
    %Debt securities
    
    
    13
    %
    
    
    13
    %Real estate
    
    
    1
    %
    
    
    1
    %Other
    
    
    3
    %
    
    
    10
    %Total
    
    
    100
    %
    
    
    100
    %
  Fair Value Measurements at December 31, 2009Quoted Prices inActive Markets
    
    
    Significantfor Identical
    
    
    Observable(In thousands)
    
    Assets
    
    
    InputsAsset Category
    
    (Level 1)
    
    
    (Level 2)
    
    
    TotalU.S.Money market funds
    
    $
    1,574
    
    
    $
    
    
    
    $
    1,574Mutual Funds:
    
    
    
    
    
    
    Corporate bond funds
    
    
    23,410
    
    
    
    
    
    
    
    23,410Domestic small-cap equity funds
    
    
    7,688
    
    
    
    
    
    
    
    7,688Domestic large-cap equity funds
    
    
    24,045
    
    
    
    
    
    
    
    24,045International large-cap equity funds (a)
    
    
    7,806
    
    
    
    
    
    
    
    7,806$
    64,523
    
    
    $
    
    
    
    $
    64,523EuropePooled funds (b)
    
    $
    
    
    
    $
    9,345
    
    
    $
    9,345
 (a)
    
    Primarily comprised of investments in Europe and the Pacific Basin.(b)
    
    Comprised of approximately 65% European and U.S. common stocks, 17% Asia/Pacific Basin and
emerging markets common stocks, and 13% bonds. The remainder represents cash and other investments.  62




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##### Table of Contents



Cash Flows
   U.S.
    
    
    Europe
    
    
    Total2010
    
    
    4,101
    
    
    
    598
    
    
    
    4,6992011
    
    
    4,288
    
    
    
    622
    
    
    
    4,9102012
    
    
    4,559
    
    
    
    646
    
    
    
    5,2052013
    
    
    4,851
    
    
    
    672
    
    
    
    5,5232014
    
    
    5,077
    
    
    
    738
    
    
    
    5,8152015-2019
    
    
    29,762
    
    
    
    4,401
    
    
    
    34,163
 Other Postretirement Benefits
   Successor
    
    
    
    Predecessor
    
    
    PredecessorEight Months Ended
    
    
    
    Four Months Ended
    
    
    Year Ended(In thousands)
    
    December 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2008Interest cost
    
    $
    232
    
    
    
    $
    109
    
    
    $
    332Recognized actuarial loss
    
    
    
    
    
    
    
    261
    
    
    
    784Recognized prior service costs
    
    
    
    
    
    
    
    (102
    )
    
    
    (307
    )Total other postretirement benefits expense
    
    $
    232
    
    
    
    $
    268
    
    
    $
    809
  Successor
    
    
    
    PredecessorEight Months Ended
    
    
    
    Four Months Ended
    
    
    Year Ended(In thousands)
    
    December 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2008Benefit obligation  beginning of period
    
    $
    5,173
    
    
    
    $
    5,310
    
    
    $
    6,066Interest cost
    
    
    232
    
    
    
    
    109
    
    
    
    332Participant contributions
    
    
    93
    
    
    
    
    50
    
    
    
    145Actuarial (gain) loss
    
    
    (1,047
    )
    
    
    
    (229
    )
    
    
    (916
    )Benefits paid
    
    
    (83
    )
    
    
    
    (67
    )
    
    
    (317
    )Benefit obligation  end of period
    
    $
    4,368
    
    
    
    $
    5,173
    
    
    $
    5,310
  63




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##### Table of Contents



Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Amounts recognized on the
consolidated balance sheets:Current liability
    
    $
    370
    
    
    
    $
    335Non-current liability
    
    
    3,998
    
    
    
    
    4,975$
    4,368
    
    
    
    $
    5,310Amounts recognized in accumulated other
comprehensive income, pretax:Net actuarial gains (losses)
    
    $
    1,046
    
    
    
    $
    (2,351
    )Prior service costs
    
    
    
    
    
    
    
    4,598$
    1,046
    
    
    
    $
    2,247
     Defined Contribution Plan
  16. Income Taxes
  Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2009
    
    
    2008U.S.
    
    $
    (36,687
    )
    
    
    $
    147,236
    
    
    $
    (41,753
    )Europe
    
    
    3,844
    
    
    
    
    865
    
    
    
    (16,472
    )Total
    
    $
    (32,843
    )
    
    
    $
    148,101
    
    
    $
    (58,225
    )
  64




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##### Table of Contents



Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2009
    
    
    2008Current tax (provision) benefit:U.S.
    
    $
    (10
    )
    
    
    $
    (18
    )
    
    $
    56Europe
    
    
    
    
    
    
    
    45
    
    
    
    391(10
    )
    
    
    
    27
    
    
    
    447Deferred tax (provision) benefit:U.S.
    
    
    12,188
    
    
    
    
    (36,926
    )
    
    
    Europe
    
    
    (362
    )
    
    
    
    (908
    )
    
    
    11,826
    
    
    
    
    (37,834
    )
    
    
    Total benefit (provision) for income taxes
    
    $
    11,816
    
    
    
    $
    (37,807
    )
    
    $
    447
  Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2009
    
    
    2008Pre-tax benefit (expense) at 35%
    
    $
    11,496
    
    
    
    $
    (51,835
    )
    
    $
    20,379State tax (provision) benefit
    
    
    1,205
    
    
    
    
    (3,002
    )
    
    
    (45
    )Non-U.S. operations at different rates
    
    
    983
    
    
    
    
    (560
    )
    
    
    (5,375
    )Non-deductible reorganization costs
    
    
    (667
    )
    
    
    
    (2,451
    )
    
    
    (1,776
    )Non-deductible goodwill
    
    
    
    
    
    
    
    (28,028
    )
    
    
    Restricted
stock cancellation
    
    
    
    
    
    
    
    (570
    )
    
    
    Other non-deductible costs
    
    
    24
    
    
    
    
    (23
    )
    
    
    2Taxable dividend distributions
    
    
    (1,225
    )
    
    
    
    
    
    
    
    Valuation allowance
    
    
    
    
    
    
    
    48,662
    
    
    
    (12,738
    )Benefit from (provision for) income taxes
    
    $
    11,816
    
    
    
    $
    (37,807
    )
    
    $
    447
  65




---



##### Table of Contents



Successor
    
    
    PredecessorEight Months
    
    
    Four MonthsEnded
    
    
    EndedDecember 31,
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    2009
    
    
    2008Deferred tax assets:Employee benefits
    
    $
    14,425
    
    
    $
    14,059
    
    
    $
    18,620Restructuring reserves
    
    
    150
    
    
    
    132
    
    
    
    302Mark-to-market cash flow hedge
    
    
    2,496
    
    
    
    2,911
    
    
    
    3,297Net operating loss carry-forwards
    
    
    56,372
    
    
    
    52,420
    
    
    
    51,269Other Accruals
    
    
    3,448
    
    
    
    4,349
    
    
    
    3,218Total deferred tax asset
    
    
    76,891
    
    
    
    73,871
    
    
    
    76,706Deferred tax liabilities:Non-accrual interest
    
    
    (3,087
    )
    
    
    (2,470
    )
    
    
    Secured debt fair value adjustment
    
    
    (20,048
    )
    
    
    (25,301
    )
    
    
    Cancellation of debt income
    
    
    (32,622
    )
    
    
    (32,622
    )
    
    
    Property, plant, and equipment
    
    
    (24,138
    )
    
    
    (27,981
    )
    
    
    (10,590
    )Intangible assets
    
    
    (12,087
    )
    
    
    (14,014
    )
    
    
    Other
    
    
    (918
    )
    
    
    (1,670
    )
    
    
    Total deferred tax (liability)
    
    
    (92,900
    )
    
    
    (104,058
    )
    
    
    (10,590
    )Valuation Allowance
    
    
    (8,744
    )
    
    
    (7,648
    )
    
    
    (66,116
    )Total Deferred tax asset / (liability)
    
    
    (24,753
    )
    
    
    (37,835
    )
    
    
    
        66




---



##### Table of Contents



(In thousands)Balance at January 1, 2008 (Predecessor)
    
    $
    678Additions for tax positions of prior years
    
    
    5Reductions for tax positions of prior years
    
    
    (106
    )Foreign currency translation impact
    
    
    26Balance at December 31, 2008 (Predecessor)
    
    
    603Additions for tax positions of prior years
    
    
    60Foreign currency translation impact
    
    
    (29
    )Balance at April 30, 2009 (Predecessor)
    
    $
    634Balance at May 1, 2009 (Successor)
    
    $
    634Settlements
    
    
    (3
    )Foreign currency translation impact
    
    
    50Balance at December 31, 2009 (Successor)
    
    $
    681
   Examination Years OpenJurisdiction
    
    From
    
    
    ToUnited States:Federal
    
    
    2005
    
    
    
    2009States (varies by jurisdictions)
    
    
    2004
    
    
    
    2009United Kingdom
    
    
    2008
    
    
    
    2009Netherlands
    
    
    2005
    
    
    
    2009Italy  (discontinued operation)
    
    
    2005
    
    
    
    2009
 17. Asset Retirement Obligations
   67




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##### Table of Contents



Successor
    
    
    
    
    
    
    
    PredecessorEight Months
    
    
    
    Fresh-start
    
    
    Four MonthsEnded
    
    
    
    Accounting
    
    
    Ended
    
    
    Year Ended(In thousands)
    
    December 31, 2009
    
    
    
    Adjustments
    
    
    April 30, 2009
    
    
    December 31, 2008Beginning balance
    
    $
    6,068
    
    
    
    $
    6,566
    
    
    $
    5,828
    
    
    $
    5,714Accretion expense
    
    
    347
    
    
    
    
    
    
    
    
    134
    
    
    
    431Revisions to estimates
    
    
    284
    
    
    
    
    
    
    
    
    759
    
    
    
    322Settlements
    
    
    (1,157
    )
    
    
    
    
    
    
    
    (155
    )
    
    
    (639
    )Fresh-start accounting adjustments
    
    
    
    
    
    
    
    (498
    )
    
    
    
    
    
    
    Ending balance
    
    $
    5,542
    
    
    
    $
    6,068
    
    
    $
    6,566
    
    
    $
    5,828
 18. Lease Commitments
   (In thousands)Year Ending December 31,2010
    
    $
    8,4482011
    
    
    7,2272012
    
    
    5,9252013
    
    
    4,4342014
    
    
    1,266Thereafter
    
    
    2,521Net minimum lease payments
    
    $
    29,821
  19. Commitments and Contingencies
 In re Constar International Inc., et al.,
   68




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##### Table of Contents



20. Discontinued Operations
   69




---



##### Table of Contents



Successor
    
    
    
    PredecessorDecember 31,
    
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2008Assets of Discontinued Operations:Accounts receivable, net
    
    $
    
    
    
    
    $
    14Prepaid expenses and other current assets
    
    
    337
    
    
    
    
    328Total current assets of discontinued operations
    
    $
    337
    
    
    
    $
    342Liabilities of Discontinued Operations:Accounts payable and accrued expenses
    
    $
    44
    
    
    
    $
    87Total current liabilities of discontinued operations
    
    
    44
    
    
    
    
    87Other liabilities
    
    
    881
    
    
    
    
    773Total liabilities of discontinued operations
    
    $
    925
    
    
    
    $
    860
   Successor
    
    
    
    PredecessorEight Months
    
    
    
    Four MonthsEnded
    
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    
    2009
    
    
    2008Net sales
    
    $
    
    
    
    
    $
    
    
    
    $
    Loss from discontinued
operations before income taxes
    
    
    (80
    )
    
    
    
    (17
    )
    
    
    (60
    )(Provision for) benefit from income taxes
    
    
    (5
    )
    
    
    
    (79
    )
    
    
    3Loss from discontinued operations
    
    $
    (85
    )
    
    
    $
    (96
    )
    
    $
    (57
    )
 21. Stockholders Equity
    70




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##### Table of Contents



22. Accumulated Other Comprehensive Income (Loss)
  Successor
    
    
    
    PredecessorEight Months Ended December 31, 2009
    
    
    
    Four Months Ended April 30, 2009Pre-tax
    
    
    Tax (Expense)
    
    
    After-tax
    
    
    
    Pre-tax
    
    
    Tax (Expense)
    
    
    After-tax(In thousands)
    
    Amount
    
    
    Benefit
    
    
    Amount
    
    
    
    Amount
    
    
    Benefit
    
    
    AmountPension and postretirement liabilities
    
    $
    (3,335
    )
    
    
    875
    
    
    $
    (2,460
    )
    
    
    $
    1,919
    
    
    
    
    
    
    $
    1,919Cash-flow hedge
    
    
    1,076
    
    
    
    (414
    )
    
    
    662
    
    
    
    
    951
    
    
    
    
    
    
    
    951Foreign currency translation adjustments
    
    
    29
    
    
    
    
    
    
    
    29
    
    
    
    
    (1,134
    )
    
    
    
    
    
    
    (1,134
    )Other comprehensive income (loss)
    
    $
    (2,230
    )
    
    $
    461
    
    
    $
    (1,769
    )
    
    
    $
    1,736
    
    
    $
    
    
    
    $
    1,736
 PredecessorYear Ended December 31, 2008Pre-tax
    
    
    Tax (Expense)
    
    
    After-tax(In thousands)
    
    Amount
    
    
    Benefit
    
    
    AmountPension and postretirement liabilities
    
    $
    (28,523
    )
    
    
    
    
    
    $
    (28,523
    )Cash-flow hedge
    
    
    (6,491
    )
    
    
    
    
    
    
    (6,491
    )Foreign currency translation adjustments
    
    
    3,317
    
    
    
    
    
    
    
    3,317Accumulated other comprehensive loss
    
    $
    (31,697
    )
    
    $
    
    
    
    $
    (31,697
    )
  Successor
    
    
    
    Predecessor(In thousands)
    
    December 31, 2009
    
    
    
    December 31, 2008Pension and postretirement liabilities
    
    $
    (2,460
    )
    
    
    $
    (49,066
    )Cash-flow hedge
    
    
    662
    
    
    
    
    (8,512
    )Foreign currency translation adjustments
    
    
    29
    
    
    
    
    7,261Accumulated other comprehensive income (loss)
    
    $
    (1,769
    )
    
    
    $
    (50,317
    )
 23. Stock-Based Compensation
    71




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##### Table of Contents



PredecessorFour Months Ended
    
    
    Year Ended(in thousands)
    
    April 30, 2009
    
    
    December 31, 2008Restricted stock
    
    $
    597
    
    
    $
    817Restricted stock units
    
    
    (6
    )
    
    
    (209
    )$
    591
    
    
    $
    608
 24. Related Party Transactions
      25. Other Income (Expense):
 Successor
    
    
    
    PredecessorEight Months Ended
    
    
    
    Four Months Ended
    
    
    Year Ended(In thousands)
    
    December 31, 2009
    
    
    
    April 30, 2009
    
    
    December 31, 2009Foreign exchange gains (losses)
    
    $
    2,259
    
    
    
    $
    1,321
    
    
    $
    (11,874
    )Royalty income
    
    
    473
    
    
    
    
    418
    
    
    
    1,877Royalty expense
    
    
    (286
    )
    
    
    
    (185
    )
    
    
    (875
    )Interest income
    
    
    42
    
    
    
    
    12
    
    
    
    136Other
    
    
    (55
    )
    
    
    
    (23
    )
    
    
    25Other income (expense), net
    
    $
    2,433
    
    
    
    $
    1,543
    
    
    $
    (10,711
    )
   72




---



##### Table of Contents



26. Derivative Financial Instruments
 Derivatives and Hedging
    Derivative LiabilitiesFair Value(In thousands)
    
    Balance
    
    Successor
    
    
    PredecessorDerivatives designated as hedging
    
    Sheet
    
    December 31,
    
    
    December 31,instruments under Statement 133
    
    Location
    
    2009
    
    
    2008Interest rate swap
    
    Other liabilities
    
    $
    6,485
    
    
    $
    8,512
  SuccessorEight Months Ended December 31, 2009Location of
    
    Amount ofAmount of
    
    
    Gain or (Loss)
    
    Gain or (Loss)Gain or (Loss)
    
    
    Reclassified
    
    ReclassifiedRecognized
    
    
    from
    
    from(In thousands)
    
    in OCI on
    
    
    Accumulated
    
    AccumulatedDerivatives in Statement 133
    
    Derivative
    
    
    OCI into Income
    
    OCI into Incomecash flow hedging relationships
    
    (Effective Portion)
    
    
    (Effective Portion)
    
    (Effective Portion)Interest rate swap
    
    $
    662
    
    
    Interest expense
    
    $
    (2,653
    )
  73




---



##### Table of Contents



PredecessorFour Months Ended April 30, 2009Location of
    
    Amount ofAmount of
    
    
    Gain or (Loss)
    
    Gain or (Loss)Gain or (Loss)
    
    
    Reclassified
    
    ReclassifiedRecognized
    
    
    from
    
    from(In thousands)
    
    in OCI on
    
    
    Accumulated
    
    AccumulatedDerivatives in Statement 133
    
    Derivative
    
    
    OCI into Income
    
    OCI into Incomecash flow hedging relationships
    
    (Effective Portion)
    
    
    (Effective Portion)
    
    (Effective Portion)Interest rate swap
    
    $
    951
    
    
    Interest expense
    
    $
    (974
    )
  27. Fair Value Measurements
  SignificantQuoted
    
    
    Significant Other
    
    
    Unobservable
    
    
    TotalPrices
    
    
    Observable Inputs
    
    
    Inputs
    
    
    Fair(In thousands)
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    ValueLiabilitiesInterest rate swap
    
    $
    
    
    
    $
    6,485
    
    
    $
    
    
    
    $
    6,485
    Successor
    
    
    
    PredecessorDecember 31, 2009
    
    
    
    December 31, 2008(In thousands)
    
    Carrying
    
    
    
    
    
    
    CarryingAssets (liabilities)
    
    Amount
    
    
    Fair Value
    
    
    
    Amount
    
    
    Fair ValueSenior Notes
    
    
    (167,919
    )
    
    
    (182,050
    )
    
    
    
    (220,000
    )
    
    
    (121,000
    )
  SignificantQuoted
    
    
    Significant Other
    
    
    Unobservable
    
    
    TotalPrices
    
    
    Observable Inputs
    
    
    Inputs
    
    
    Fair(In thousands)
    
    (Level 1)
    
    
    (Level 2)
    
    
    (Level 3)
    
    
    ValueGoodwill
    
    $
    
    
    
    $
    
    
    
    $
    118,682
    
    
    $
    118,682Trade name
    
    $
    
    
    
    $
    
    
    
    $
    21,500
    
    
    $
    21,500
  28. Major Customers
   74




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##### Table of Contents



29. Segment and Geographic Area Information
   Net salesSuccessor
    
    
    PredecessorEight
    
    
    FourMonths
    
    
    Months
    
    
    
    
    
    
    Property, plant and equipment, netEnded
    
    
    Ended
    
    
    Year Ended
    
    
    Successor
    
    
    PredecessorDecember 31,
    
    
    April 30,
    
    
    December 31,
    
    
    December 31,(In thousands)
    
    2009
    
    
    2009
    
    
    2008
    
    
    2009
    
    
    2008United States
    
    $
    327,965
    
    
    $
    180,086
    
    
    $
    682,579
    
    
    $
    131,074
    
    
    $
    114,145United Kingdom
    
    
    81,657
    
    
    
    33,733
    
    
    
    151,155
    
    
    
    10,448
    
    
    
    14,171Holland
    
    
    11,565
    
    
    
    3,362
    
    
    
    24,135
    
    
    
    10,004
    
    
    
    4,055Total
    
    $
    421,187
    
    
    $
    217,181
    
    
    $
    857,869
    
    
    $
    151,526
    
    
    $
    132,371
 30. Supplemental Disclosure of Cash Flow Information
  Successor
    
    
    PredecessorEight
    
    
    FourMonths
    
    
    MonthsEnded
    
    
    Ended
    
    
    Year EndedDecember 31,
    
    
    April 30,
    
    
    December 31,(In thousands)
    
    2009
    
    
    2009
    
    
    2008Interest payments
    
    $
    10,778
    
    
    $
    4,344
    
    
    $
    29,090Income tax payments
    
    $
    494
    
    
    $
    25
    
    
    $
    192
  75




---



##### Table of Contents



31. Subsequent Event
    32. Condensed Consolidating Financial Information
   76




---



##### Table of Contents



Condensed Consolidating Balance Sheet
December 31, 2009
(In thousands)
 SuccessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyASSETSCurrent Assets:Cash and cash equivalents
    
    $
    
    
    
    $
    2,022
    
    
    $
    447
    
    
    $
    
    
    
    $
    2,469Intercompany receivables
    
    
    
    
    
    
    216,779
    
    
    
    10,821
    
    
    
    (227,600
    )
    
    
    Accounts receivable, net
    
    
    
    
    
    
    36,785
    
    
    
    2,269
    
    
    
    
    
    
    
    39,054Inventories, net
    
    
    
    
    
    
    40,284
    
    
    
    3,774
    
    
    
    
    
    
    
    44,058Prepaid expenses and other current assets
    
    
    12
    
    
    
    7,218
    
    
    
    666
    
    
    
    
    
    
    
    7,896Restricted Cash
    
    
    
    
    
    
    7,589
    
    
    
    
    
    
    
    
    
    
    
    7,589Deferred income taxes
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total current assets
    
    
    12
    
    
    
    310,677
    
    
    
    17,977
    
    
    
    (227,600
    )
    
    
    101,066Property, plant and equipment, net
    
    
    
    
    
    
    141,521
    
    
    
    10,005
    
    
    
    
    
    
    
    151,526Goodwill and intangible assets
    
    
    
    
    
    
    150,080
    
    
    
    
    
    
    
    
    
    
    
    150,080Investment in subsidiaries
    
    
    405,700
    
    
    
    20,910
    
    
    
    
    
    
    
    (426,610
    )
    
    
    Other assets
    
    
    552
    
    
    
    2,728
    
    
    
    312
    
    
    
    
    
    
    
    3,592Total assets
    
    $
    406,264
    
    
    $
    625,916
    
    
    $
    28,294
    
    
    $
    (654,210
    )
    
    $
    406,264LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Short-term debt
    
    $
    5,000
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    5,000Accounts payable and accrued liabilities
    
    
    1,681
    
    
    
    79,325
    
    
    
    3,375
    
    
    
    
    
    
    
    84,381Intercompany payable
    
    
    202,330
    
    
    
    24,441
    
    
    
    829
    
    
    
    (227,600
    )
    
    
    Deferred income taxes
    
    
    
    
    
    
    1,222
    
    
    
    
    
    
    
    
    
    
    
    1,222Total current liabilities
    
    
    209,011
    
    
    
    104,988
    
    
    
    4,204
    
    
    
    (227,600
    )
    
    
    90,603Long-term debt
    
    
    167,919
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    167,919Pension and postretirement liabilities
    
    
    
    
    
    
    30,053
    
    
    
    1,052
    
    
    
    
    
    
    
    31,105Deferred income taxes
    
    
    (55,754
    )
    
    
    78,038
    
    
    
    1,247
    
    
    
    
    
    
    
    23,531Other liabilities
    
    
    6,485
    
    
    
    7,137
    
    
    
    881
    
    
    
    
    
    
    
    14,503Total liabilities
    
    
    327,661
    
    
    
    220,216
    
    
    
    7,384
    
    
    
    (227,600
    )
    
    
    327,661Commitments and contingenciesStockholders equity (deficit)
    
    
    78,603
    
    
    
    405,700
    
    
    
    20,910
    
    
    
    (426,610
    )
    
    
    78,603Total liabilities and stockholders
equity (deficit)
    
    $
    406,264
    
    
    $
    625,916
    
    
    $
    28,294
    
    
    $
    (654,210
    )
    
    $
    406,264
  77




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##### Table of Contents



CONDENSED CONSOLIDATING BALANCE SHEET
December 31, 2008
(In thousands)
 PredecessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantor
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyASSETSCurrent Assets:Cash and cash equivalents
    
    $
    
    
    
    $
    13,933
    
    
    $
    359
    
    
    $
    
    
    
    $
    14,292Intercompany receivable
    
    
    
    
    
    
    210,818
    
    
    
    10,375
    
    
    
    (221,193
    )
    
    
    Accounts receivable, net
    
    
    
    
    
    
    43,466
    
    
    
    2,338
    
    
    
    
    
    
    
    45,804Inventories, net
    
    
    
    
    
    
    47,142
    
    
    
    2,619
    
    
    
    4
    
    
    
    49,765Prepaid expenses and other current assets
    
    
    4,692
    
    
    
    19,078
    
    
    
    537
    
    
    
    
    
    
    
    24,307Deferred income taxes
    
    
    
    
    
    
    896
    
    
    
    
    
    
    
    
    
    
    
    896Current assets of discontinued operations
    
    
    
    
    
    
    
    
    
    
    342
    
    
    
    
    
    
    
    342Total current assets
    
    
    4,692
    
    
    
    335,333
    
    
    
    16,570
    
    
    
    (221,189
    )
    
    
    135,406Property, plant and equipment, net
    
    
    
    
    
    
    128,678
    
    
    
    4,056
    
    
    
    (363
    )
    
    
    132,371Goodwill
    
    
    
    
    
    
    148,813
    
    
    
    
    
    
    
    
    
    
    
    148,813Investments in subsidiaries
    
    
    463,610
    
    
    
    16,528
    
    
    
    
    
    
    
    (480,138
    )
    
    
    Other assets
    
    
    
    
    
    
    1,514
    
    
    
    112
    
    
    
    
    
    
    
    1,626Non-current assets of discontinued operations
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Total assets
    
    $
    468,302
    
    
    $
    630,866
    
    
    $
    20,738
    
    
    $
    (701,690
    )
    
    $
    418,216LIABILITIES AND STOCKHOLDERS EQUITY (DEFICIT)Current Liabilities:Short-term debt
    
    $
    20,000
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    
    20,000Current portion of long-term debt
    
    
    220,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    220,000Accounts payable and accrued liabilities
    
    
    4,141
    
    
    
    89,312
    
    
    
    2,053
    
    
    
    
    
    
    
    95,506Intercompany payable
    
    
    190,523
    
    
    
    30,549
    
    
    
    480
    
    
    
    (221,552
    )
    
    
    Current liabilities of discontinued operations
    
    
    
    
    
    
    
    
    
    
    87
    
    
    
    
    
    
    
    87Total current liabilities
    
    
    434,664
    
    
    
    119,861
    
    
    
    2,620
    
    
    
    (221,552
    )
    
    
    335,593Pension and postretirement liabilities
    
    
    
    
    
    
    37,695
    
    
    
    817
    
    
    
    
    
    
    
    38,512Deferred income taxes
    
    
    
    
    
    
    896
    
    
    
    
    
    
    
    
    
    
    
    896Other liabilities
    
    
    8,511
    
    
    
    8,804
    
    
    
    
    
    
    
    
    
    
    
    17,315Non-current liabilities of discontinued operations
    
    
    
    
    
    
    
    
    
    
    773
    
    
    
    
    
    
    
    773Liabilities subject to compromise
    
    
    186,229
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    186,229Total liabilities
    
    
    629,404
    
    
    
    167,256
    
    
    
    4,210
    
    
    
    (221,552
    )
    
    
    579,318Commitments and contingent liabilitiesStockholders equity (deficit)
    
    
    (161,102
    )
    
    
    463,610
    
    
    
    16,528
    
    
    
    (480,138
    )
    
    
    (161,102
    )Total liabilities and stockholders
equity (deficit)
    
    $
    468,302
    
    
    $
    630,866
    
    
    $
    20,738
    
    
    $
    (701,690
    )
    
    $
    418,216
  78




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##### Table of Contents



Condensed Consolidating Statement of Operations
For the eight months ended December 31, 2009
(In thousands)
 SuccessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    409,609
    
    
    $
    11,578
    
    
    $
    
    
    
    $
    421,187Cost of products sold, excluding depreciation
    
    
    
    
    
    
    364,403
    
    
    
    10,277
    
    
    
    
    
    
    
    374,680Depreciation
    
    
    
    
    
    
    32,680
    
    
    
    458
    
    
    
    
    
    
    
    33,138Gross profit
    
    
    
    
    
    
    12,526
    
    
    
    843
    
    
    
    
    
    
    
    13,369Selling and administrative expenses
    
    
    
    
    
    
    12,904
    
    
    
    115
    
    
    
    
    
    
    
    13,019Research and technology expenses
    
    
    
    
    
    
    5,284
    
    
    
    
    
    
    
    
    
    
    
    5,284Impairment of Intangible Assets
    
    
    
    
    
    
    4,000
    
    
    
    
    
    
    
    
    
    
    
    4,000Provision for restructuring
    
    
    
    
    
    
    1,584
    
    
    
    
    
    
    
    
    
    
    
    1,584Gain on disposal of assets
    
    
    
    
    
    
    (427
    )
    
    
    
    
    
    
    
    
    
    
    (427
    )Total operating expenses
    
    
    
    
    
    
    23,345
    
    
    
    115
    
    
    
    
    
    
    
    23,460Operating income (Loss)
    
    
    
    
    
    
    (10,819
    )
    
    
    728
    
    
    
    
    
    
    
    (10,091
    )Interest expense
    
    
    (23,279
    )
    
    
    (424
    )
    
    
    424
    
    
    
    
    
    
    
    (23,279
    )Reorganization items, net
    
    
    (1,906
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,906
    )Other income (expense), net
    
    
    
    
    
    
    2,361
    
    
    
    72
    
    
    
    
    
    
    
    2,433Income (loss) from continuing
operations before income taxes
    
    
    (25,185
    )
    
    
    (8,882
    )
    
    
    1,224
    
    
    
    
    
    
    
    (32,843
    )(Provision for) benefit from income taxes
    
    
    6,923
    
    
    
    5,255
    
    
    
    (362
    )
    
    
    
    
    
    
    11,816Income (loss) from continuing operations
    
    
    (18,262
    )
    
    
    (3,627
    )
    
    
    862
    
    
    
    
    
    
    
    (21,027
    )Equity earnings
    
    
    (2,850
    )
    
    
    777
    
    
    
    
    
    
    
    2,073
    
    
    
    Income from discontinued operations, net of taxes
    
    
    
    
    
    
    
    
    
    
    (85
    )
    
    
    
    
    
    
    (85
    )Net income (loss)
    
    $
    (21,112
    )
    
    $
    (2,850
    )
    
    $
    777
    
    
    $
    2,073
    
    
    $
    (21,112
    )
  79




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the four months ended April 30, 2009
(In thousands)
 PredecessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    213,819
    
    
    $
    3,362
    
    
    $
    
    
    
    $
    217,181Cost of products sold, excluding depreciation
    
    
    
    
    
    
    185,975
    
    
    
    3,562
    
    
    
    
    
    
    
    189,537Depreciation and amortization
    
    
    
    
    
    
    9,507
    
    
    
    226
    
    
    
    
    
    
    
    9,733Gross profit
    
    
    
    
    
    
    18,337
    
    
    
    (426
    )
    
    
    
    
    
    
    17,911Selling and administrative expenses
    
    
    
    
    
    
    6,802
    
    
    
    203
    
    
    
    
    
    
    
    7,005Research and technology expenses
    
    
    
    
    
    
    2,698
    
    
    
    
    
    
    
    
    
    
    
    2,698Provision for restructuring
    
    
    
    
    
    
    648
    
    
    
    
    
    
    
    
    
    
    
    648Gain on disposal of assets
    
    
    
    
    
    
    (396
    )
    
    
    
    
    
    
    
    
    
    
    (396
    )Total operating expenses
    
    
    
    
    
    
    9,752
    
    
    
    203
    
    
    
    
    
    
    
    9,955Operating income (loss)
    
    
    
    
    
    
    8,585
    
    
    
    (629
    )
    
    
    
    
    
    
    7,956Interest expense
    
    
    (5,566
    )
    
    
    (204
    )
    
    
    204
    
    
    
    
    
    
    
    (5,566
    )Reorganization items, net
    
    
    77,853
    
    
    
    61,679
    
    
    
    4,636
    
    
    
    
    
    
    
    144,168Other income (expense), net
    
    
    
    
    
    
    1,546
    
    
    
    (3
    )
    
    
    
    
    
    
    1,543Income from continuing
operations before income taxes
    
    
    72,287
    
    
    
    71,606
    
    
    
    4,208
    
    
    
    
    
    
    
    148,101Provision for income taxes
    
    
    
    
    
    
    (36,944
    )
    
    
    (863
    )
    
    
    
    
    
    
    (37,807
    )Income from continuing operations
    
    
    72,287
    
    
    
    34,662
    
    
    
    3,345
    
    
    
    
    
    
    
    110,294Equity earnings
    
    
    37,911
    
    
    
    3,249
    
    
    
    
    
    
    
    (41,160
    )
    
    
    Loss from discontinued operations, net of taxes
    
    
    
    
    
    
    
    
    
    
    (96
    )
    
    
    
    
    
    
    (96
    )Net income (loss)
    
    $
    110,198
    
    
    $
    37,911
    
    
    $
    3,249
    
    
    $
    (41,160
    )
    
    $
    110,198
  80




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##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF OPERATIONS
For the year ended December 31, 2008
(In thousands)
 PredecessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantor
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyNet sales
    
    $
    
    
    
    $
    833,734
    
    
    $
    24,135
    
    
    $
    
    
    
    $
    857,869Cost of products sold, excluding depreciation
    
    
    
    
    
    
    766,419
    
    
    
    23,442
    
    
    
    
    
    
    
    789,861Depreciation
    
    
    
    
    
    
    31,995
    
    
    
    816
    
    
    
    
    
    
    
    32,811Gross profit
    
    
    
    
    
    
    35,320
    
    
    
    (123
    )
    
    
    
    
    
    
    35,197Selling and administrative expenses
    
    
    
    
    
    
    22,359
    
    
    
    386
    
    
    
    
    
    
    
    22,745Research and technology expenses
    
    
    
    
    
    
    8,536
    
    
    
    
    
    
    
    
    
    
    
    8,536Provision for restructuring
    
    
    
    
    
    
    4,811
    
    
    
    
    
    
    
    
    
    
    
    4,811(Gain) loss on disposal of assets
    
    
    
    
    
    
    (1,227
    )
    
    
    
    
    
    
    
    
    
    
    (1,227
    )Total operating expenses
    
    
    
    
    
    
    34,479
    
    
    
    386
    
    
    
    
    
    
    
    34,865Operating income
    
    
    
    
    
    
    841
    
    
    
    (509
    )
    
    
    
    
    
    
    332Interest expense
    
    
    (38,656
    )
    
    
    (315
    )
    
    
    559
    
    
    
    
    
    
    
    (38,412
    )Interest expense  related party
    
    
    
    
    
    
    (244
    )
    
    
    
    
    
    
    
    
    
    
    (244
    )Reorganization costs
    
    
    (9,190
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (9,190
    )Other income (expense), net
    
    
    
    
    
    
    (10,690
    )
    
    
    (21
    )
    
    
    
    
    
    
    (10,711
    )Income (loss) from continuing
operations before income taxes
    
    
    (47,846
    )
    
    
    (10,408
    )
    
    
    29
    
    
    
    
    
    
    
    (58,225
    )(Provision for) benefit from income taxes
    
    
    
    
    
    
    57
    
    
    
    390
    
    
    
    
    
    
    
    447Income (loss) from continuing operations
    
    
    (47,846
    )
    
    
    (10,351
    )
    
    
    419
    
    
    
    
    
    
    
    (57,778
    )Equity earnings
    
    
    (9,989
    )
    
    
    362
    
    
    
    
    
    
    
    9,627
    
    
    
    Loss from discontinued operations, net of taxes
    
    
    
    
    
    
    
    
    
    
    (57
    )
    
    
    
    
    
    
    (57
    )Net income (loss)
    
    $
    (57,835
    )
    
    $
    (9,989
    )
    
    $
    362
    
    
    $
    9,627
    
    
    $
    (57,835
    )
  81




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##### Table of Contents



Condensed Consolidating Statement of Cash Flows
For the eight months ended December 31, 2009
(In thousands)
 SuccessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyCash flows from operating activities:Net income (loss)
    
    $
    (21,112
    )
    
    $
    (2,850
    )
    
    $
    777
    
    
    $
    2,073
    
    
    $
    (21,112
    )Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation and amortization
    
    
    23
    
    
    
    32,666
    
    
    
    450
    
    
    
    
    
    
    
    33,139Debt accretion
    
    
    13,644
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    13,644Impairment of Intangible Asset
    
    
    
    
    
    
    4,000
    
    
    
    
    
    
    
    
    
    
    
    4,000Gain on disposal of assets
    
    
    
    
    
    
    (427
    )
    
    
    
    
    
    
    
    
    
    
    (427
    )Reorganization items
    
    
    (6,893
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (6,893
    )Fresh Start accounting adjustment
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Equity earnings
    
    
    2,850
    
    
    
    (777
    )
    
    
    
    
    
    
    (2,073
    )
    
    
    Changes in operating assets and liabilities
    
    
    (12,460
    )
    
    
    (407
    )
    
    
    (1,351
    )
    
    
    
    
    
    
    (14,218
    )Net cash provided by (used in)
operating activities
    
    
    (23,948
    )
    
    
    32,205
    
    
    
    (124
    )
    
    
    
    
    
    
    8,133Cash flows from investing activities:Restricted cash
    
    
    
    
    
    
    1,738
    
    
    
    
    
    
    
    
    
    
    
    1,738Purchases of property, plant and equipment
    
    
    
    
    
    
    (7,747
    )
    
    
    (1,046
    )
    
    
    
    
    
    
    (8,793
    )Proceeds from the sale of property, plant and equipment
    
    
    
    
    
    
    9
    
    
    
    
    
    
    
    
    
    
    
    9Net cash used in investing activities
    
    
    
    
    
    
    (6,000
    )
    
    
    (1,046
    )
    
    
    
    
    
    
    (7,046
    )Cash flows from financing activities:Costs associated with exit facility
    
    
    (575
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (575
    )Proceeds from Revolver loan
    
    
    458,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    458,000Repayment of Revolver loan
    
    
    (458,000
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (458,000
    )Net change in intercompany loans
    
    
    24,523
    
    
    
    (25,546
    )
    
    
    1,023
    
    
    
    
    
    
    
    Net cash provided by (used in)
financing activities
    
    
    23,948
    
    
    
    (25,546
    )
    
    
    1,023
    
    
    
    
    
    
    
    (575
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    46
    
    
    
    27
    
    
    
    
    
    
    
    73Net increase (decrease) in cash and cash equivalents
    
    
    
    
    
    
    705
    
    
    
    (120
    )
    
    
    
    
    
    
    585Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    1,317
    
    
    
    567
    
    
    
    
    
    
    
    1,884Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    2,022
    
    
    $
    447
    
    
    $
    
    
    
    $
    2,469
  82




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the four months ended April 30, 2009
(In thousands)
 PredecessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantors
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyCash flows from operating activities:Net income (loss)
    
    $
    110,198
    
    
    $
    37,911
    
    
    $
    3,249
    
    
    $
    (41,160
    )
    
    $
    110,198Adjustments to reconcile net income (loss) to net cash
provided by operating activities:Depreciation and amortization
    
    
    317
    
    
    
    9,514
    
    
    
    229
    
    
    
    
    
    
    
    10,060Stock-based compensation
    
    
    
    
    
    
    591
    
    
    
    
    
    
    
    
    
    
    
    591Gain on disposal of assets
    
    
    
    
    
    
    (396
    )
    
    
    
    
    
    
    
    
    
    
    (396
    )Reorganization items
    
    
    (79,299
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (79,299
    )Fresh Start accounting adjustments
    
    
    2,654
    
    
    
    (66,127
    )
    
    
    (4,636
    )
    
    
    
    
    
    
    (68,109
    )Equity earnings
    
    
    (37,911
    )
    
    
    (3,249
    )
    
    
    
    
    
    
    41,160
    
    
    
    Changes in operating assets and liabilities
    
    
    (46
    )
    
    
    42,547
    
    
    
    1,955
    
    
    
    
    
    
    
    44,456Net cash provided by (used in) operating activities
    
    
    (4,087
    )
    
    
    20,791
    
    
    
    797
    
    
    
    
    
    
    
    17,501Cash flows from investing activities:Restricted cash
    
    
    
    
    
    
    (9,327
    )
    
    
    
    
    
    
    
    
    
    
    (9,327
    )Purchases of property, plant and equipment
    
    
    
    
    
    
    (5,557
    )
    
    
    (166
    )
    
    
    
    
    
    
    (5,723
    )Proceeds from the sale of property, plant and equipment
    
    
    
    
    
    
    149
    
    
    
    
    
    
    
    
    
    
    
    149Net cash used in investing activities
    
    
    
    
    
    
    (14,735
    )
    
    
    (166
    )
    
    
    
    
    
    
    (14,901
    )Cash flows from financing activities:Proceeds from Revolver loan
    
    
    212,723
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    212,723Repayment of Revolver loan
    
    
    (227,723
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (227,723
    )Net change in intercompany loans
    
    
    19,087
    
    
    
    (18,680
    )
    
    
    (407
    )
    
    
    
    
    
    
    Net cash provided by (used in) financing activities
    
    
    4,087
    
    
    
    (18,680
    )
    
    
    (407
    )
    
    
    
    
    
    
    (15,000
    )Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    8
    
    
    
    (16
    )
    
    
    
    
    
    
    (8
    )Net increase (decrease) in cash and cash equivalents
    
    
    
    
    
    
    (12,616
    )
    
    
    208
    
    
    
    
    
    
    
    (12,408
    )Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    13,933
    
    
    
    359
    
    
    
    
    
    
    
    14,292Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    1,317
    
    
    $
    567
    
    
    $
    
    
    
    $
    1,884
  83




---



##### Table of Contents



CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
For the Year ended December 31, 2008
(In thousands)
 PredecessorNon-
    
    
    
    
    
    
    TotalParent
    
    
    Guarantor
    
    
    Guarantor
    
    
    Eliminations
    
    
    CompanyCash flows from operating activities:Net income (loss)
    
    $
    (57,835
    )
    
    $
    (9,989
    )
    
    $
    362
    
    
    $
    9,627
    
    
    $
    (57,835
    )Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:Depreciation and amortization
    
    
    1,995
    
    
    
    32,381
    
    
    
    784
    
    
    
    
    
    
    
    35,160(Gain) loss on disposal of assets
    
    
    
    
    
    
    (964
    )
    
    
    
    
    
    
    
    
    
    
    (964
    )Stock-based compensation
    
    
    
    
    
    
    608
    
    
    
    
    
    
    
    
    
    
    
    608Non-Cash reorganization costs
    
    
    3,851
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,851Equity earnings
    
    
    9,989
    
    
    
    (362
    )
    
    
    
    
    
    
    (9,627
    )
    
    
    Changes in operating assets and liabilities
    
    
    (14,077
    )
    
    
    48,649
    
    
    
    (1,251
    )
    
    
    
    
    
    
    33,321Net cash provided by (used in) operating activities
    
    
    (56,077
    )
    
    
    70,323
    
    
    
    (105
    )
    
    
    
    
    
    
    14,141Cash flows from investing activities:Purchases of property, plant and equipment
    
    
    
    
    
    
    (25,115
    )
    
    
    (207
    )
    
    
    
    
    
    
    (25,322
    )Proceeds from the sale of property, plant and equipment
    
    
    
    
    
    
    1,852
    
    
    
    
    
    
    
    
    
    
    
    1,852Proceeds form the cash surrender value of life insurance
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net cash used in investing activities
    
    
    
    
    
    
    (23,263
    )
    
    
    (207
    )
    
    
    
    
    
    
    (23,470
    )Cash flows from financing activities:Proceeds from Revolver loan
    
    
    779,096
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    779,096Repayment of Revolver loan
    
    
    (759,534
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (759,534
    )Net change in intercompany loans
    
    
    36,515
    
    
    
    (36,238
    )
    
    
    (277
    )
    
    
    
    
    
    
    Costs associated with debt refinancing
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other financing activities
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Net cash provided by (used in) financing activities
    
    
    56,077
    
    
    
    (36,238
    )
    
    
    (277
    )
    
    
    
    
    
    
    19,562Effect of exchange rate changes on cash and cash equivalents
    
    
    
    
    
    
    (183
    )
    
    
    (12
    )
    
    
    
    
    
    
    (195
    )Net increase in cash and cash equivalents
    
    
    
    
    
    
    10,639
    
    
    
    (601
    )
    
    
    
    
    
    
    10,038Cash and cash equivalents at beginning of period
    
    
    
    
    
    
    3,294
    
    
    
    960
    
    
    
    
    
    
    
    4,254Cash and cash equivalents at end of period
    
    $
    
    
    
    $
    13,933
    
    
    $
    359
    
    
    $
    
    
    
    $
    14,292
  84




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##### Table of Contents



Schedule IIValuation and Qualifying Accounts and Reserves
  Balance at
    
    
    
    
    
    
    
    
    
    
    Fresh-Start
    
    
    Balance atBeginning of
    
    
    
    
    
    
    
    
    
    
    Accounting
    
    
    End ofPeriod
    
    
    Additions
    
    
    Deductions
    
    
    Adjustments
    
    
    PeriodFor the Eight Months Ended December 31, 2009Trade accounts receivable
    
    $
    
    
    
    
    435
    
    
    
    (113
    )
    
    
    
    
    
    $
    322Inventory
    
    $
    
    
    
    
    2,213
    
    
    
    (1,028
    )
    
    
    
    
    
    $
    1,185Deferred taxes
    
    $
    7,648
    
    
    
    16,111
    
    
    
    (15,015
    )
    
    
    
    
    
    $
    8,744For the Four Months Ended April 30, 2009Trade accounts receivable
    
    $
    1,904
    
    
    
    (483
    )
    
    
    (23
    )
    
    
    (1,398
    )
    
    $
    Inventory
    
    $
    707
    
    
    
    467
    
    
    
    (72
    )
    
    
    (1,102
    )
    
    $
    Deferred taxes
    
    $
    66,116
    
    
    
    40,180
    
    
    
    (98,648
    )
    
    
    
    
    
    $
    7,648For the Year Ended December 31, 2008Trade accounts receivable
    
    $
    1,166
    
    
    
    1,841
    
    
    
    (1,103
    )
    
    
    
    
    
    $
    1,904Inventory
    
    $
    693
    
    
    
    1,266
    
    
    
    (1,252
    )
    
    
    
    
    
    $
    707Deferred taxes
    
    $
    41,310
    
    
    
    27,189
    
    
    
    (2,383
    )
    
    
    
    
    
    $
    66,116
  85




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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
     
 ITEM 9B.
    
    OTHER INFORMATION
   For
    
    
    WithheldMichael J. Balduino
    
    
    1,451,218
    
    
    
    2,752Eric A. Balzer
    
    
    1,451,218
    
    
    
    2,752Michael J. Hoffman
    
    
    1,451,961
    
    
    
    2,009Lawrence V. Jackson
    
    
    1,451,218
    
    
    
    2,752Ruth J. Mack
    
    
    1,451,218
    
    
    
    2,752L. White Matthews, III
    
    
    1,451,961
    
    
    
    2,009
   For
    
    Against
    
    
    Abstain1,175,010
    
    
    9,640
    
    
    
    2,210
  For
    
    Against
    
    
    Abstain1,453,302
    
    
    212
    
    
    
    455
  86




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##### Table of Contents



PART III
 
 ITEM 10.
    
    DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE
 Executive Officers of the Registrant
  Name
    
    Age
    
    TitleMichael J. Hoffman (1)
    
    
    49
    
    
    President, Chief Executive Officer and DirectorJ. Mark Borseth (2)
    
    
    51
    
    
    Executive Vice President and Chief Financial OfficerJames C.T. Bolton (3)
    
    
    55
    
    
    Senior Vice President,
Administration and Strategic PlanningDonald P. Deubel (4)
    
    
    46
    
    
    Senior Vice President, Corporate TechnologiesJerry A. Hatfield (5)
    
    
    51
    
    
    Senior Vice President, OperationsDavid Schroeder (6)
    
    
    41
    
    
    Senior Vice President, Sales and MarketingDavid J. Waksman (7)
    
    
    43
    
    
    Senior Vice President, Human Resources, General Counsel and SecretaryChristopher P. Phelan (8)
    
    
    42
    
    
    Vice President and General Manager, European Operations
 
 (1)
    
    Michael J. Hoffman. Mr. Hoffman has been President and Chief
Executive Officer and a director of our Company since May 2002.
Mr. Hoffman has been President of Constar, Inc. since October
2000. Mr. Hoffman was previously Vice President of Operations for
Constar, Inc. since 1995, and director of Crown Cork & Seal
Company, Inc.s Aerosol Manufacturing division from 1993 to 1995.
Prior to that, Mr. Hoffman was a Plant Superintendent, and then a
Plant Manager, in several United States branches of Crown Cork &
Seal Company, Inc. from 1987 to 1993. Prior to 1987, Mr. Hoffman
was a Plant Superintendent for Continental Can Company and held
various other plant management positions.(2)
    
    J. Mark Borseth. Mr. Borseth was appointed as our Executive Vice
President and Chief Financial Officer in September 2009. Mr. Borseth
was the Senior Vice President, Chief Financial Officer of Eclipse
Aviation, an aircraft manufacturer, from May 2007 through August 2009.
Eclipse Aviation filed for bankruptcy in November 2008. Prior to that,
from 1984 to April 2007, Mr. Borseth held a series of financial and
general management positions with 3M, including Vice President, Global
Business Process from 2004 to 2007, and Corporate Treasurer in 2003.(3)
    
    James C.T. Bolton. Mr. Bolton has been Senior Vice President,
Administration and Strategic Planning of our Company since May 2002.
Previously, Mr. Bolton had been Senior Vice President, Strategic
Planning and Information Systems for the Americas Division of Crown
Cork & Seal Company, Inc. since 2001. Prior to that, Mr. Bolton was
Vice President, Finance of Constar, Inc. from 1996 to 2001. Mr. Bolton
was Vice President, Finance and Planning for the International
Division of Crown Cork & Seal Company, Inc. from 1992 to 1996. Prior
to that, Mr. Bolton was Director of Insurance for Crown Cork & Seal
Company, Inc. and was responsible for all benefits and
property/casualty coverage in the U.S. from 1984 to 1992. Mr. Bolton
also worked in the Treasury and Audit departments of Crown Cork & Seal
Company, Inc. from 1978 to 1984.(4)
    
    Donald P. Deubel. Mr. Deubel has been Senior Vice President, Corporate
Technologies of our Company since November 2008.  Previously, he was
Vice President, Corporate Technologies since September 2002. Previously, Mr.
Deubel had been Director of Packaging Development of Constar, Inc.
from July 2000 to September 2002 and Senior Manager of Closure
Engineering and Corporate Technologies for Crown Cork & Seal Company,
Inc. from December 1997 to July 2000.(5)
    
    Jerry A. Hatfield. Mr. Hatfield has been Senior Vice President,
Operations of our Company since September, 2007. Mr. Hatfield was
previously our Vice President, Operations from March 2003 to September
2007, Western Regional Manager from 2001 to 2003, and an Operations
Manager from 1999 to 2001. Prior to that, Mr. Hatfield was a Plant
Superintendent and then a Plant Manager of a Crown Cork & Seal
Company, Inc. can and closure facility from 1991 to 1998.(6)
    
    David Schroeder. Mr. Schroeder has served as Senior Vice President of
Sales and Marketing since March 2010. In 2009 Mr. Schroeder was the
Chief Operating Officer of Medical Instill Technologies, a provider of
packaging and dispensing solutions for aseptic, non-preserved
products. From 1995-2008, Mr. Schroeder held a variety of sales,
business development and management positions with the Tetra Laval
Group. Most recently, from 2005-2008 Mr. Schroeder was Managing
Director, Zone Vice President North America for Tetra Lavals Sidel
business, a manufacturer of packaging equipment.(7)
    
    David J. Waksman.Mr. Waksman has been Senior Vice President, Human
Resources, General Counsel and Secretary of our Company since April
2008. Prior to that he, was Vice President, General Counsel and
Secretary of our Company since July 2003. Previously, Mr. Waksman was
a partner at the law firm of Dechert LLP.(8)
    
    Christopher P. Phelan.Mr. Phelan has been Vice President and General
Manager, European Operations of our Company since July 2007. Since
January 2004, Mr. Phelan had been Technical Director of our European
operations. Prior to that, Mr. Phelan was employed by Rexam as
Technical/Operations Director.  87




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##### Table of Contents



Directors of the Registrant
  Name
    
    Age
    
    TitleL. White Matthews, III (1)
    
    64
    
    
    Chairman of the Board of DirectorsMichael J. Balduino (2)
    
    59
    
    
    DirectorEric A. Balzer (3)
    
    61
    
    
    DirectorMichael J. Hoffman (4)
    
    49
    
    
    DirectorLawrence V. Jackson (5)
    
    56
    
    
    DirectorRuth J. Mack (6)
    
    55
    
    
    Director
 (1)
    
    L White Matthews, III. Mr. Matthews has served as a director and chairman of the Board since
May 2009. Mr. Matthews has been retired since September 2001. From July 1999 until September 2001,
Mr. Matthews served as Executive Vice President and Chief Financial Officer of Ecolab, Inc., as
well as a member of its Board of Directors. Mr. Matthews was retired from May 1998 to July 1999.
From February 1977 to May 1998, Mr. Matthews served in various financial positions with Union
Pacific Corporation. From November 1989 to May 1998 he was Executive Vice President and Chief
Financial Officer of Union Pacific and he was a member of its Board of Directors from 1994 to 1998.
Mr. Matthews is a director of Imation Corp. and Matrixx Initiatives, Inc. As Chairman of our Board
of Directors and Chairman of our Boards Nominating and Governance Committee, Mr. Matthews brings
his experience from years of service on the boards of several public and privately-held companies,
as well as his experience as a senior executive. These experiences have provided him with a depth
and breath of knowledge in dealing with governance, leadership, strategic, financial and accounting
matters.(2)
    
    Michael J. Balduino.Mr. Balduino has served as a director since May 2009. Mr. Balduino
retired from International Paper Company at the end of 2009, where he most recently served as
Senior Vice President-Consumer Packaging since 2008. Mr. Balduino previously served with
International Paper Company as Senior Vice President responsible for consumer products converting
business and President-Shorewood Packaging Corp. from 2004 to 2008; and as Senior Vice
President-Sales and Marketing from 2000 to 2003. Mr. Balduino brings his packaging experience to
the Board, as well as his experience as the senior executive of a publicly-traded company.(3)
    
    Eric A. Balzer.Mr. Balzer has served as a director since May 2009. Mr. Balzer has been the
Chief Financial Officer of Ramtron International Corporation since 2004. Prior to that, he was
Senior Vice President, Operations of Advanced Energy Industries from 1990-1999. Mr. Balzer is a
director of Ramtron International Corporation and Cap Terra Financial Group. Mr. Balzer serves as
the Chair of our Audit Committee owing to his knowledge of finance, accounting and auditing
procedures gained through his work experience, including as the Chief Financial Officer of a
publicly-traded company. Mr. Balzer has been designed as an Audit Committee Financial Expert. Mr.
Balzer also brings a knowledge of lean manufacturing techniques that are being adopted by the
Company.(4)
    
    Michael J. Hoffman. Mr. Hoffman has been President and Chief Executive Officer and a director
of our Company since May 2002. Mr. Hoffman has been President of Constar, Inc. since October 2000.
Mr. Hoffman was previously Vice President of Operations for Constar, Inc. since 1995, and director
of Crown Cork & Seal Company, Inc.s Aerosol Manufacturing
division from 1993 to 1995. Prior to that, Mr. Hoffman was a Plant Superintendent, and then a Plant
Manager, in several United States branches of Crown Cork & Seal Company, Inc. from 1987 to 1993.
Prior to 1987, Mr. Hoffman was a Plant Superintendent for Continental Can Company and held various
other plant management positions. Mr. Hoffman has a knowledge of Constar gained through his 15
years of service to the Company. He also brings manufacturing expertise acquired throughout his
career.(5)
    
    Lawrence V. Jackson.Mr. Jackson has served as a director since May 2009. Mr. Jackson has
been the Chief Executive Officer of Sourcemark LLC since 2007, and a Senior Advisor to New Mountain
Capital since 2008. Mr. Jackson was the President and Chief Executive Officer, Global Procurement
of Wal-Mart Stores, Inc. from 2006 to 2007, and he was the Executive Vice President and Chief
People Officer of Wal-Mart Stores, Inc. from 2004 to 2006. Mr. Jackson was the President and Chief
Operating Officer of Dollar General Stores, Inc. from 2003 to 2004, and the Senior Vice President,
Supply Operations of Safeway, Inc. from 1997 to 2003. Prior to that Mr. Jackson enjoyed a 16-year
career at PepsiCo, Inc., beginning as plant manager and ending as Senior Vice President, Chief
Operating Officer, Worldwide Operations of PepsiCo Food Systems. Mr. Jackson is a director of
ProLogis and Assurant, Inc. Mr. Jackson is an experienced executive of several notable companies.
His history with major retailers and consumer product companies allows him to offer perspectives on
important customers and markets.  88




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##### Table of Contents



(6)
    
    Ruth J. Mack.Ms. Mack has served as a director since May 2009. Ms. Mack was President,
WinCup Plastics and Executive Vice President, New WinCup Holdings from 2006-2009. From 1999-2006,
she worked for Alcoa, Inc., most recently as Vice President, Alcoa and Group President Alcoa
Packaging & Consumer Products. Prior roles included Vice President, Reynolds Metals Company and
General Manager, Reynolds Consumer Products and President Alcoa Consumer Products. Previous to
Alcoa, Ms. Mack held a series of general management, marketing, sales, product development,
distribution and logistics positions in multinational companies such as General Mills, PepsiCo,
Nestle, Pillsbury and WLR Foods. Ms. Mack brings to our Board her experience as a senior
executive with a variety of companies performing both general management and more specialized
roles. These experiences have provided Ms. Mack with a breadth of knowledge in such areas as
strategic development, marketing and general management. Audit Committee.
 Audit Committee Financial Expert.
 Code of Ethics. www.constar.net
 Section 16(a) Beneficial Ownership Reporting Compliance
 
 ITEM 11.
    
    EXECUTIVE COMPENSATION
  Summary Compensation Table
 Non-EquityStock
    
    
    Incentive Plan
    
    
    All otherSalary
    
    
    Awards
    
    
    Compensation
    
    
    Compensation
    
    
    TotalName and Principal Position
    
    Year
    
    
    ($)
    
    
    ($)(1)
    
    

($)(2)
    
    
    ($)
    
    
    ($)Michael J. Hoffman
    
    
    2009
    
    
    
    497,950
    
    
    
    0
    
    
    
    161,336
    
    
    
    309,571
    (3)
    
    
    968,857President and Chief Executive Officer
    
    
    2008
    
    
    
    474,238
    
    
    
    229,500
    
    
    
    2,915
    
    
    
    43,512
    (4)
    
    
    750,165James C.T. Bolton
    
    
    2009
    
    
    
    259,995
    
    
    
    0
    
    
    
    56,354
    
    
    
    58,330
    (5)
    
    
    374,679Senior Vice President, Administration and Strategic PlanningChristopher P. Phelan(6)
    
    
    2009
    
    
    
    230,190
    
    
    
    0
    
    
    
    124,303
    
    
    
    34,020
    (7)
    
    
    388,513Vice President and General
Manager, European Operations
    
    
    2008
    
    
    
    259,270
    
    
    
    0
    
    
    
    0
    
    
    
    36,907
    (8)
    
    
    296,177Walter S. Sobon (9)
    
    
    2009
    
    
    
    280,025
    
    
    
    0
    
    
    
    0
    
    
    
    412,618
    (10)
    
    
    692,6432008
    
    
    
    324,450
    
    
    
    94,500
    
    
    
    997
    
    
    
    22,591
    (11)
    
    
    442,538
  89




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##### Table of Contents



(1)
    
    The dollar amounts reported in this column represent the grant date fair value
calculated according to ASC 718 of restricted stock awards granted in fiscal
year 2008 pursuant to the 2007 Stock-Based Incentive Compensation Plan. The
fair value of restricted stock awards is equal to the quoted market price of
the Companys common stock at the date of grant. Restricted stock units
(RSUs) are classified as liabilities in the accompanying consolidated
financial statements. The fair value of the liabilities related to the RSUs is
remeasured at each balance sheet date. Adjustments to the fair value of the RSU
liabilities are recorded as compensation expense.(2)
    
    Non-equity incentive plan compensation for 2009 represents amounts earned under
the 2009 Annual Incentive Plan. Non-equity incentive plan compensation for
2008 represents interest earned on deferred non-equity incentive plan
compensation. See Narrative Disclosure to Summary Compensation Table for an
explanation of the timing of payment of such amounts.(3)
    
    Includes $265,658 paid in connection with termination of the Companys
Supplemental Executive Retirement Plan; a $12,000 car benefit; $9,987 country
club expense reimbursement and $5,779 gross up for such reimbursement; and
$15,299 in 401(k) matching funds.(4)
    
    Includes a $12,000 car benefit, $9,623 country club expense reimbursement and
$5,587 tax gross-up for such reimbursement, and $15,500 in 401(k) matching
funds. The Company determined that excess matching funds in the
amounts of $5,150 and $4,274 were contributed to Mr. Hoffmans 401(k)
account in 2008 and 2009, respectively. These amounts were
forfeited to the Company in 2009 and 2010, respectively.(5)
    
    Includes $36,296 paid in connection with termination of the Companys
Supplemental Executive Retirement Plan; a $9,000 car benefit; and $12,105 in
401(k) matching funds. The Company determined that excess matching funds of $1,080 were
contributed to Mr. Boltons 401(k)
account in 2009.  These amounts were forfeited to the Company in 2010.(6)
    
    Payments to Mr. Phelan were made in British pounds. Compensation data for 2009
has been converted to U.S. dollars using the 2009 daily average exchange rate
of 1.57 dollars per pound. Compensation data for 2008 has been converted to
U.S. dollars using the 2008 daily average exchange rate of 1.85 dollars per
pound.(7)
    
    Includes a $33,523 car benefit.(8)
    
    Includes a $36,289 car benefit.(9)
    
    Mr. Sobon resigned as an executive officer of the Company on September 23, 2009.(10)
    
    Includes $360,000 paid in connection with the rejection of Mr. Sobons
employment agreement with the Company; accrued but untaken vacation pay of
$22,911; $12,369 paid in connection with termination of the Supplemental
Executive Retirement Plan; $9,348 in 401(k) matching funds; and a $6,975 car
benefit.(11)
    
    Includes a $9,000 car benefit and $12,415 in 401(k) matching funds. The Company
has determined that excess matching funds in the amount of $2,065 were
contributed to Mr. Sobons 401(k) account. This amount was forfeited to the
Company in 2009. Narrative Disclosure to Summary Compensation Table
 The
Annual Incentive Plan.
 Target Awards
  90




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##### Table of Contents



Michael Hoffman
    
    
    Christopher Phelan
    
    
    James BoltonMaximum corporate portion of
award
    
    $
    423,257
    
    
    $
    69,057
    
    
    $
    90,998Actual corporate portion of award
    
    $
    126,977
    
    
    $
    20,717
    
    
    $
    27,300Maximum unit portion of award
    
    
    N/A
    
    
    $
    86,321
    
    
    
    N/AActual unit portion of award
    
    
    N/A
    
    
    $
    86,321
    
    
    
    N/AMaximum personal portion of award
    
    $
    74,693
    
    
    $
    17,264
    
    
    $
    38,999Actual personal portion of award
    
    $
    74,693
    
    
    $
    17,264
    
    
    $
    38,999Mandatory reduction
    
    $
    (40,334
    )
    
    
    N/A
    
    
    $
    (9,945
    )Maximum total award
    
    $
    497,950
    
    
    $
    172,642
    
    
    $
    129,997Actual award
    
    $
    161,336
    
    
    $
    124,303
    
    
    $
    56,354
 How Awards are Paid.
 What is Non-Equity Incentive Plan Compensation?
 What is included in 2009 and 2008 Non-Equity Incentive Plan Compensation?
 Stock Awards.
 Pension Benefits
 Present
    
    
    PaymentsValue of
    
    
    DuringAccumulated
    
    
    LastBenefit
    
    
    Fiscal YearName
    
    Plan Name
    
    ($)
    
    
    ($)Michael J. Hoffman
    
    Constar Pension Plan
    
    
    142,889
    
    
    
    0Michael J. Hoffman
    
    Constar Supplemental
    
    
    0
    
    
    
    265,658Executive Retirement PlanJames C.T. Bolton
    
    Constar Pension Plan
    
    
    297,195
    
    
    
    0James C.T. Bolton
    
    Constar Supplemental
    
    
    0
    
    
    
    36,296Executive Retirement PlanWalter S. Sobon
    
    Constar Pension Plan
    
    
    0
    
    
    
    0Walter S. Sobon
    
    Constar Supplemental
    
    
    0
    
    
    
    12,369Executive Retirement PlanChristopher Phelan(1)
    
    Constar UK Retirement
    
    
    130,737
    
    
    
    0Benefits Scheme
 (1)
    
    Because he is not a U.S. employee, Mr. Phelan was not eligible to
participate in the Constar Pension Plan or the SERP. We maintain a
separate stand-alone pension plan for the benefit of our employees in
the United Kingdom, called the Constar International UK Limited
Retirement Benefits Scheme (the UK Plan), in which Mr. Phelan
participates.  91




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##### Table of Contents



United States Pension Plans
 The Constar Pension Plan.
   The Supplemental Executive Retirement Plan.
 Offset of Crown Pension Plan Benefits.
 Actuarial Assumptions.
 Funded Status of Constar Pension Plan.
 European Pension Plan. th
  92




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##### Table of Contents



Funded Status of UK Plan.
 Potential Payments Upon Termination or Change in Control
 Messrs. Hoffman and Bolton.
  plus plus
 plus plus
   93




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##### Table of Contents



Mr. Phelan. plus
  94




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##### Table of Contents



Estimated Payments.
 EstimatedAmount ofEstimated
    
    
    ContinuedCash
    
    
    HealthPayment
    
    
    Benefits
    
    
    Total($)
    
    
    ($)
    
    
    ($)Michael J. Hoffman
    
    
    2,489,750
    (2)
    
    
    46,837
    (3)
    
    
    2,536,587James C. T. Bolton
    
    
    454,992
    (4)
    
    
    23,419
    (5)
    
    
    478,411Christopher P. Phelan
    
    
    
    
    
    
    
    
    
    
    
 
 (1)
    
    All amounts above are based on the assumption that the triggering
event for the payments occurred on December 31, 2009.(2)
    
    This amount is estimated to equal two times the executives base
salary plus two times the executives target bonus and matching
incentive under the AIP.(3)
    
    This amount is estimated to equal the premium payments for 24 months of health coverage at our sole expense.(4)
    
    This amount is estimated to equal one times the executives base
salary plus one times the executives target bonus and matching
incentive under the AIP.(5)
    
    This amount is estimated to equal premium payments for 12 months of health coverage at our sole expense.  EstimatedAmount ofEstimated
    
    
    Continued
    
    
    EstimatedCash
    
    
    Health
    
    
    Excise TaxPayment
    
    
    Benefits
    
    
    Gross-Up
    
    
    TotalName
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    ($)Michael J. Hoffman
    
    
    3,734,625
    (2)
    
    
    70,256
    (3)
    
    
    1,626,964
    (4)
    
    
    5,431,845James C. T. Bolton
    
    
    909,983
    (5)
    
    
    46,837
    (6)
    
    
    302,547
    (7)
    
    
    1,259,367Christopher P. Phelan (8)
    
    
    805,665
    (9)
    
    
    2,255
    (10)
    
    
    
    
    
    
    807,920
 
 (1)
    
    All amounts above are based on the assumption that the triggering
event for the payments occurred on December 31, 2009.(2)
    
    This amount is estimated to equal three times the executives base
salary plus three times the executives target bonus and matching
incentive under the AIP.(3)
    
    This amount is estimated to equal premium payments for 36 months of health coverage at our sole expense.(4)
    
    This amount does not reflect the value of Mr. Hoffmans three-year
non-competition and non-solicitation agreement with us. Such value
may be offset from the parachute payments attributed to Mr. Hoffman in
connection with a change in control.(5)
    
    This amount is estimated to equal two times the
executives base salary plus two times the
executives target bonus and matching incentive
under the AIP.(6)
    
    This amount is estimated to equal premium payments for 24 months of health coverage at our sole expense.  95




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##### Table of Contents



(7)
    
    This amount does not reflect the value of the executives two-year
non-competition and non-solicitation agreement with us. Such value
may be offset from the parachute payments attributed to the executive
in connection with a change in control.(8)
    
    Payments to Mr. Phelan are converted to US Dollars at the average daily exchange rate for 2009 of $1.56593 to £1.(9)
    
    This amount is estimated to equal two times the executives base salary plus two times the executives target bonus.(10)
    
    This amount is estimated to equal the employer-paid portion of
premium payments for 24 months of health coverage.  EstimatedCashPaymentName
    
    ($)(2)Michael J. Hoffman
    
    
    746,925James C. T. Bolton
    
    
    194,996Christopher P. Phelan
    
    
    
 
 (1)
    
    All amounts above are based on the assumption that the triggering
event for the payments occurred on December 31, 2009.(2)
    
    This amount is equal to the executives target bonus and matching incentive under the AIP. Mr. Sobon
 Director Compensation
 Current Board of Directors.
 FeesEarnedor Paidin CashName
    
    ($)Michael J. Balduino
    
    
    40,580Eric A. Balzer
    
    
    53,486Lawrence V. Jackson
    
    
    45,080Ruth J. Mack
    
    
    50,486L. White Matthews
    
    
    89,832
  96




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Attendance Fee forAnnual
    
    
    Board or ApplicableRetainer
    
    
    Committee MeetingPosition
    
    ($)
    
    
    ($)Chairman of the Board of Directors
    
    
    120,000
    
    
    
    1,500Non-Chairman Director
    
    
    45,000
    
    
    
    1,500Chairman of the Audit Committee
    
    
    10,000
    
    
    
    1,000Non-Chairman Member of the Audit Committee
    
    
    0
    
    
    
    1,000Chairman of the Compensation and Benefits Committee
    
    
    10,000
    
    
    
    1,000Non-Chairman Member of the Compensation and
Benefits Committee
    
    
    0
    
    
    
    1,000Chairman of the Nominating and Corporate
Governance Committee
    
    
    5,000
    
    
    
    1,000Non-Chairman Member of the Nominating and
Corporate Governance Committee
    
    
    0
    
    
    
    1,000
   Former Board of Directors.
 FeesEarnedor Paidin CashName
    
    ($)James A. Lewis
    
    
    31,313Michael D. McDaniel
    
    
    34,343Frank J. Mechura
    
    
    47,755John P. Neafsey
    
    
    65,648Angus F. Smith
    
    
    51,552A. Alexander Taylor
    
    
    36,843
  Attendance Fee forAnnual
    
    
    Board or ApplicableRetainer
    
    
    Committee MeetingPosition
    
    ($)
    
    
    ($)Chairman of the Board of Directors
    
    
    91,500
    
    
    
    2,000Non-Chairman Director
    
    
    56,500
    
    
    
    1,000Chairman of the Audit Committee
    
    
    14,000
    
    
    
    2,000Non-Chairman Member of the Audit Committee
    
    
    3,500
    
    
    
    1,500Chairman of the Compensation Committee
    
    
    5,000
    
    
    
    1,500Non-Chairman Member of the Compensation Committee
    
    
    2,500
    
    
    
    1,000Chairman of the Nominating and Corporate Governance Committee
    
    
    5,000
    
    
    
    1,500Non-Chairman Member of the Nominating and Corporate
Governance Committee
    
    
    2,500
    
    
    
    1,000
   97




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ITEM 12.
    
    SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER
MATTERS
  
    
    the number of securities to be issued upon the exercise of outstanding options;
 
    
    the weighted-average exercise price of the outstanding options; and
 
    
    the number of securities that remain available for future issuance under the plans.
 Number of
    
    
    
    
    
    
    Number ofsecurities to be
    
    
    
    
    
    
    securitiesissued upon
    
    
    Weighted-average
    
    
    remaining availableexercise of
    
    
    exercise price of
    
    
    for future issuanceoutstanding options,
    
    
    outstanding options,
    
    
    under equityPlan Category
    
    warrants and rights
    
    
    warrants and rights
    
    
    compensation plansEquity compensation plans:Approved by security holders (1)
    
    
    
    
    
    
    
    
    
    
    129,629Not approved by security holders (2)
    
    
    
    
    
    
    
    
    
    
    64,815Total
    
    
    
    
    
    
    
    
    
    
    194,444
 
 (1)
    
    Represents securities available for issuance under the 2009 Equity Compensation Plan.(2)
    
    Represents securities available for issuance under the Plan of Reorganization
adopted in connection with the Companys emergence from Chapter 11.    98




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##### Table of Contents



Number ofShares
    
    
    Percent ofBeneficially
    
    
    Shares5% Beneficial Owners, Directors, Named Officers
    
    Owned
    
    
    OutstandingSolus Alternative Asset Management LP, Solus GP LLC,
and Christopher Pucillo
    
    
    425,280
    
    
    
    24.3
    %430 Park Avenue, 9th Floor 
New York, NY 10022 (1)(2)JP Morgan Chase & Co.
    
    
    250,250
    
    
    
    14.3
    %270 Park Avenue
New York, NY 10017 (1)FMR LLC82 Devonshire Street
Boston, MA 02109 (1)(3)
    
    
    175,600
    
    
    
    10.0
    %Trafelet Capital Management, L.P.,
Trafelet & Company LLC and Remy Trafelet (1)(4)
590 Madison Avenue, 26thFloor
New York, NY 10022
    
    
    159,600
    
    
    
    9.1
    %Peritus I Asset Management LLC
26 W. Anapamu Street, 3rd Floor
Santa Barbara, CA 93101 (1)
    
    
    92,450
    
    
    
    5.3
    %Michael J. Balduino
    
    
    0
    
    
    
    0Eric A. Balzer
    
    
    0
    
    
    
    0Lawrence V. Jackson
    
    
    0
    
    
    
    0Ruth J. Mack
    
    
    0
    
    
    
    0L. White Matthews III
    
    
    0
    
    
    
    0Michael J. Hoffman
    
    
    0
    
    
    
    0James C.T. Bolton
    
    
    0
    
    
    
    0Christopher Phelan
    
    
    0
    
    
    
    0Walter S. Sobon
    
    
    0
    
    
    
    0All directors and executive officers
as a group (14 persons)
    
    
    0
    
    
    
    0
 
 (1)
    
    The number of shares beneficially owned is derived from reports
filed by each such beneficial owner under Section 13 or Section
16 of the Securities Exchange Act of 1934.(2)
    
    According to the Schedule 13G filed by the named persons on June 9,
2009, Solus GP LLC is the general partner of Solus Alternative Asset
Management LP and Christopher Pucillo
is the managing member of Solus GP LLC.(3)
    
    According to the Schedule 13G filed by the named person on September
10, 2009, Fidelity Management & Research Company is the beneficial
owner of 169,100 shares of Constar common stock (equal to 9.7% of the
outstanding shares), and Fidelity Capital & Income Fund is the
beneficial owner of 115,450 shares of Constar common stock (equal to
6.6% of the outstanding shares). Additional information regarding the
beneficial ownership of such shares is contained within such Schedule
13G.(4)
    
    According to the Schedule 13G filed by the named persons on January
21, 2010, the reported shares are held by several private investment funds
for which Trafelet Capital Management, L.P. serves as the investment
manager. Trafelet & Company, LLC serves as the general partner of
Trafelet Capital Management, L.P. and Remy Trafelet serves as managing
member of Trafelet & Company, LLC.   99




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ITEM 13.
    
    CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE
  Policy for Approval of Related Person Transactions
      Director Independence
  
 ITEM 14.
    
    PRINCIPAL ACCOUNTING FEES AND SERVICES
 Audit Fees.
 Audit-Related Fees
  100




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##### Table of Contents



Tax Fees
 All Other Fees
 provided
  101




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PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 (a) The following documents are filed as part of this report:
 All Financial Statements
  Financial Statement Schedules:
  Exhibits:
  3.1
    
    
    Restated Certificate of Incorporation (incorporated by
reference to Exhibit 1 of the Companys Registration Statement
on Form 8-A filed on June 1, 2009).3.2
    
    
    Amended and Restated Bylaws (incorporated by reference to
Exhibit 2 of the Companys Registration Statement on Form 8-A
filed on June 1, 2009).4.1
    
    
    Indenture, dated as of February 11, 2005 among Constar
International Inc., the Note Guarantors party thereto, and the
Bank of New York, as Trustee, relating to the Companys Senior
Secured Floating Rate Notes due 2012 (incorporated by
reference to Exhibit 4.1 of the Companys Current Report on
Form 8-K, filed on February 17, 2005).4.2
    
    
    U.S. Security Agreement, dated as of February 11, 2005
among Constar International Inc., the Domestic Restricted
Subsidiaries party thereto, as Grantors, and the Bank of
New York, as Trustee (incorporated by reference to
Exhibit 4.4 of the Companys Current Report on Form 8-K,
filed on February 17, 2005).4.3
    
    
    Amendment No. 1 to U.S. Security Agreement, dated as of
February 11, 2010, by and among Constar International
Inc., Constar, Inc., DT, Inc., BFF Inc., Constar Foreign
Holdings, Inc. and The Bank of New York Mellon
(incorporated by reference to Exhibit 4.3 of the
Companys Current Report on Form 8-K, filed on February
17, 2010).4.4
    
    
    Access, Use and Intercreditor Agreement, dated as of
February 11, 2010, by and among General Electric Capital
Corporation, The Bank of New York Mellon, The Bank of New
York Mellon, London Branch, Constar International Inc.,
Constar, Inc., DT, Inc., BFF Inc., Constar Foreign
Holdings, Inc. and Constar International U.K. Limited
(incorporated by reference to Exhibit 4.5 of the
Companys Current Report on Form 8-K, filed on February
17, 2010).4.5
    
    
    Debenture, dated as of February 11, 2005, between Constar
International UK Ltd, as Chargor, and the Bank of New
York (acting out of its London office) as Security
Trustee (incorporated by reference to Exhibit 4.6 of the
Companys Current Report on Form 8-K, filed on February
17, 2005).4.6
    
    
    Deed of Amendment Relating to a Debenture dated 11
February 2005, dated as of February 11, 2010, by and
between Constar International U.K. Limited and The Bank
of New York Mellon (incorporated by reference to Exhibit
4.4 of the Companys Current Report on Form 8-K, filed on
February 17, 2010).10.1
    
    
    Supply Agreement between Constar, Inc. and Pepsi-Cola
Advertising and Marketing, Inc. dated as of January 1,
2009 (incorporated by reference to Exhibit 10.1 of the Companys
Annual Report on Form 10-K filed on March 31, 2009).10.2
    
    
    Credit Agreement, dated as of February 11, 2010, by and
among Constar International Inc., Constar, Inc., DT,
Inc., BFF Inc., Constar Foreign Holdings, Inc., Constar
International U.K. Limited, each of the other Persons
party thereto that is designated as a Credit Party,
General Electric Capital Corporation, for itself as
lender and as agent for the lenders from time to time
party thereto, and the lenders from time to time party
thereto (the schedules and exhibits to the Credit
Agreement have been omitted; a copy of any omitted
schedule or exhibit will be furnished to the Securities
and Exchange Commission supplementally upon request)
(incorporated by reference to Exhibit 10.3 of the
Companys Current Report on Form 8-K, filed on February
17, 2010).
  102




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##### Table of Contents



10.3
    
    
    Guaranty and Security Agreement, dated as of February 11,
2010, by Constar International Inc., Constar, Inc., DT,
Inc., BFF Inc., Constar Foreign Holdings, Inc. and each
of the other entities from time to time party thereto, in
favor of General Electric Capital Corporation
(incorporated by reference to Exhibit 10.4 of the
Companys Current Report on Form 8-K, filed on February
17, 2010).10.4
    
    
    Deed of Charge and Assignment, dated as of February 11,
2010, by and between Constar International U.K. Limited
and General Electric Capital Corporation (incorporated by
reference to Exhibit 10.5 of the Companys Current Report
on Form 8-K, filed on February 17, 2010).10.5
    
    
    Guaranty and Indemnity, dated as of February 11, 2010, by
and between Constar International U.K. Limited and
General Electric Capital Corporation (incorporated by
reference to Exhibit 10.6 of the Companys Current Report
on Form 8-K, filed on February 17, 2010).10.6
    
    
    Charge Over Shares, dated as of February 11, 2010, by and
between Constar Foreign Holdings, Inc. and General
Electric Capital Corporation (incorporated by reference
to Exhibit 10.7 of the Companys Current Report on Form
8-K, filed on February 17, 2010).10.7
    
    
    Subordination Agreement, dated as of February 11, 2010,
by and among Constar International Holland (Plastics)
B.V., Constar International UK Limited and General
Electric Capital Corporation (incorporated by reference
to Exhibit 10.8 of the Companys Current Report on Form
8-K, filed on February 17, 2010).10.8
    
    
    Amended and Restated Executive Employment Agreement,
dated as of May 29, 2009, by and between Constar
International Inc. and Michael J. Hoffman (incorporated
by reference to Exhibit 99.2 of the Companys Current
Report on Form 8-K filed on June 4, 2009).*10.9
    
    
    Amended and Restated Executive Employment Agreement,
dated as of May 29, 2009, by and between Constar
International Inc. and James C.T. Bolton (incorporated by
reference to Exhibit 99.3 of the Companys Current Report
on Form 8-K filed on June 4, 2009).*10.10
    
    
    Amended and Restated Executive Employment Agreement, dated
as of May 29, 2009 by and between Constar International
Inc. and David J. Waksman (incorporated by reference to
Exhibit 99.4 of the Companys Current Report on Form 8-K
filed on June 4, 2009).*10.11
    
    
    Agreement, dated as of September 23, 2009, between Constar
International Inc. and J. Mark Borseth (incorporated by
reference to Exhibit 99.1 of the Companys Current Report
on Form 8-K filed on September 23, 2009).*10.12
    
    
    Change of Control Agreement (incorporated by reference to
Exhibit 10.27 of the Companys Registration Statement on
Form S-1 (Reg. No. 333-88878) filed on September 17,
2002).*10.12
    a
    
    Form of amendment to Change of Control Agreement
(incorporated by reference to Exhibit 10.27a filed with the
Companys Quarterly Report on Form 10-Q for the quarter
ended September 30, 2007, filed on November 14, 2007).*10.12
    b
    
    Agreement dated August 1, 2007 between Constar
International Inc. and Chris Phelan (incorporated by
reference to Exhibit 10.27b filed with the Companys
Quarterly Report on Form 10-Q for the quarter ended
September 30, 2007, filed on November 14, 2007).*10.13
    
    
    Constar International Inc. 2009 Equity Compensation Plan
(incorporated by reference to Exhibit A of the Companys
Definitive Proxy Statement filed on September 28, 2009).*10.14
    
    
    Constar International Inc. Annual Incentive Plan
(incorporated by reference to Exhibit 99.1 of the
Registrants Current Report on Form 8-K filed on June 1,
2009).*10.15
    
    
    Constar International Inc. Short-Term Incentive Plan
(incorporated by reference to Exhibit 10.28 of the
Companys Registration Statement on Form S-1 (Reg. No.
333-88878) filed on October 17, 2002).*
  103




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##### Table of Contents



21.1
    
    
    Subsidiaries of Constar International Inc.23.1
    
    
    Consent of PricewaterhouseCoopers LLP.31.1
    
    
    Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification of President and Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.32.2
    
    
    Certification of Executive Vice President and Chief Financial Officer Pursuant to 18 U.S.C.
Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
 
 *
    
    Management contract or compensatory plan or arrangement required to be filed as an exhibit
pursuant to Item 15(b) of this Report.
    
    Confidential treatment granted.  104




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##### Table of Contents



SIGNATURES
  Constar International Inc.Dated:  March 24, 2010
    By:
    /s/    J. Mark BorsethJ. Mark BorsethExecutive Vice President and
Chief Financial Officer  SIGNATURE
    
    TITLE
    
    DATE/s/ Michael J. Hoffman

Michael J. Hoffman
    
    President, Chief Executive
Officer and Director
 (principal
executive officer)
    
    March 24, 2010/s/ J. Mark Borseth

J. Mark Borseth
    
    Executive Vice President and
Chief Financial Officer
(principal financial and
accounting officer)
    
    March 24, 2010/s/ L. White Matthews

L. White Matthews
    
    Director
    
    March 24, 2010/s/ Michael J. Balduino
    
    Director
    
    March 24, 2010Michael J. Balduino/s/ Eric A. Balzer
    
    Director
    
    March 24, 2010Eric A. Balzer/s/ Lawrence V. Jackson
    
    Director
    
    March 24, 2010Lawrence V. Jackson/s/ Ruth J. Mack
    
    Director
    
    March 24, 2010Ruth J. Mack
  105