##### 



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM
10-K/A
 Amendment No. 1
 Annual Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
 For the fiscal year ended December 31, 2004
 Commission File Number 333-53276
 U.S. Can Corporation
  Delaware
(State or other jurisdiction of
incorporation or organization)
    
    06-1094196
(I.R.S. Employer Identification No.)700 East Butterfield Road, Suite 250, Lombard, Illinois
    
    60148(Address of principal executive offices)
    
    (Zip code)
 (630) 678-8000
 Securities registered pursuant to Section 12(b) of the Act: None
 Securities registered pursuant to Section 12(g) of the Act: None
  o þ
 þ
  o þ




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TABLE OF CONTENTS
 PagePART IItem 1. Business
    
    
    2Item 2. Properties
    
    
    11Item 3. Legal Proceedings
    
    
    12Item 4. Submission of Matters to a Vote of Security Holders
    
    
    12PART IIItem 5. Market for Registrants Common Equity and Related Stockholder Matters
    
    
    13Item 6. Selected Financial Data
    
    
    14Item 7. Managements Discussion and Analysis of Financial
Condition and Results of Operations
    
    
    15Item 7A. Quantitative and Qualitative Disclosures About Market Risk
    
    
    25Item 8. Financial Statements and Supplementary Data
    
    
    26Item 9. Changes in and Disagreements With Accountants on Accounting
and Financial Disclosure
    
    
    67Item 9A. Controls and Procedures
    
    
    67PART IIIItem 10. Directors and Executive Officers of the Registrant
    
    
    69Item 11. Executive Compensation
    
    
    72Item 12. Security Ownership of Certain Beneficial Owners and Management
    
    
    79Item 13. Certain Relationships and Related Transactions
    
    
    81Item 14. Principal Accountant Fees and Services
    
    
    83PART IVItem 15. Exhibits and Financial Statement Schedules
    
    
    84
  INCLUSION OF FORWARD-LOOKING INFORMATION
  1




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##### 



Restatement
  
    
    Item 1. Business
    
    Item 6. Selected Financial Data
    
    Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    Item 8. Financial Statements and Supplementary Data
    
    Item 9A. Controls and Procedures
   
 PART I
 
 ITEM 1. BUSINESS
 General
   Business Segments
  Aerosol Products
  2




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International Operations
   Paint, Plastic & General Line Products
   Custom & Specialty Products
   Customers and Sales Force
   3




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Raw Materials
       Seasonality
  Labor
  4




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Competition
      Strategic Transactions
  5




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Risk Factors
 We have substantial debt that could negatively impact our business by, among other things,
increasing our vulnerability to general adverse economic and industrial conditions and preventing
us from fulfilling our obligations under our borrowing agreements.
   
    
    make it difficult for us to satisfy our obligations; including making interest
payments under our Credit Agreement and our 10 7/8% Senior Secured Notes and 12 3/8%
Senior Subordinated Notes agreements;
    
    limit our ability to obtain additional financing to operate our business;
    
    limit our financial flexibility in planning for and reacting to industry changes;
    
    place us at a competitive disadvantage as compared to less leveraged companies;
    
    increase our vulnerability to general adverse economic and industry conditions,
including changes in interest rates; and
    
    require us to dedicate a substantial portion of our cash flow to payments on our
debt, reducing the availability of our cash flow for other purposes.
  If we do not generate sufficient positive cash flows, we may be unable to service our debt.
    
    
    our debt holders could declare all outstanding principal and interest to be due and
payable;
    
    our senior debt lenders could terminate their commitments and commence foreclosure
proceedings against our assets; and
    
    we could be forced into bankruptcy or liquidation.
 The terms of our debt may severely limit our ability to plan for or respond to changes in our
business.
  
    
    incur liens or make negative pledges on our assets;
    
    merge, consolidate or sell our assets;
 6




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##### 




    
    issue additional debt;
    
    pay dividends or redeem capital stock and prepay other debt;
    
    enter into sale and leaseback transactions;
    
    make investments and acquisitions;
    
    enter into transactions with affiliates;
    
    make capital expenditures;
    
    materially change our business;
    
    amend our debt and other material agreements;
    
    issue and sell capital stock;
    
    allow our subsidiaries to enter into agreements that restrict distributions to us; or
    
    prepay specified indebtedness.
  Our Credit Facility bears interest at a floating rate, and if interest rates rise, our payments
will increase and we may incur losses.
  Berkshire Partners owns a controlling interest in our voting securities.
  We face competitive risks from many sources that may reduce demand for our products and adversely
affect our sales and results of operations.
   7




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##### 



Increases in tin-plated steel prices could cause our production costs to increase, which could
reduce our ability to compete effectively.
    Our principal markets are subject to overcapacity, which could cause us to lose business and result
in decreased profitability.
   We have significant underfunded pension plan obligations and significant unfunded post-retirement
obligations, which could lead to increases in our pension expenses and postretirement benefit
expenses.
   8




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##### 



We have recently experienced losses and our future profitability is uncertain.
  We face risks associated with our international operations.
  
    
    fluctuations in currency exchange rates;
    
    restrictions on dividend payments and other payments by our foreign subsidiaries;
    
    withholding and other taxes on dividend payments and other payments by our foreign subsidiaries; and
    
    investment regulation and other restrictions by foreign governments.
  
    
    limitations on conversion of foreign currencies into United States dollars;
    
    hyperinflation; and
    
    political instability.
 Our business is subject to substantial environmental regulation and remediation, which could result
in increased compliance costs and adversely affect our results of operations and profitability.
   9




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##### 



A significant portion of our workforce is unionized and labor disruptions could decrease our
productivity.
  Increased costs associated with corporate governance compliance may significantly affect our
results of operations.
  Our internal controls over financial reporting may not be adequate, which could have a significant
and adverse effect on our business and reputation.
  10




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##### 



ITEM 2. PROPERTIES
  Location
    
    Size (in sq. ft.)
    
    Status
    
    SegmentUnited StatesElgin, IL (1)
    
    
    481,346
    
    
    Owned
    
    AerosolTallapoosa, GA (1)
    
    
    249,480
    
    
    Owned
    
    AerosolBaltimore, MD
    
    
    232,172
    
    
    Leased
    
    Custom & SpecialtyCommerce, CA
    
    
    240,203
    
    
    Leased
    
    Paint, Plastic & General LineNewnan, GA
    
    
    185,122
    
    
    Leased
    
    Paint, Plastic & General LineHubbard, OH (1)
    
    
    174,970
    
    
    Owned
    
    Paint, Plastic & General LineBaltimore, MD (1)
    
    
    137,000
    
    
    Owned
    
    Custom & SpecialtyHorsham, PA (1)
    
    
    132,000
    
    
    Owned
    
    AerosolWeirton, WV
    
    
    145,700
    
    
    Leased
    
    AerosolDanville, IL (1)
    
    
    100,000
    
    
    Owned
    
    AerosolAlliance, OH
    
    
    52,000
    
    
    Leased
    
    Paint, Plastic & General LineEuropeErftstadt, Germany
    
    
    369,000
    
    
    Leased
    
    InternationalMerthyr Tydfil, United Kingdom (2)
    
    
    320,000
    
    
    Leased
    
    InternationalLaon, France
    
    
    220,000
    
    
    Owned
    
    InternationalReus, Spain
    
    
    182,250
    
    
    Owned
    
    InternationalItzehoe, Germany
    
    
    80,730
    
    
    Owned
    
    InternationalEsbjerg, Denmark
    
    
    66,209
    
    
    Owned
    
    InternationalVoghera, Italy
    
    
    45,200
    
    
    Leased
    
    InternationalSchwedt, Germany
    
    
    35,500
    
    
    Leased
    
    International
  (1)
    
    The plants that we own in the United States are subject to a lien in favor of Deutsche Bank
Trust Company Americas as administrative agent for the lenders under the Credit Facility.(2)
    
    The property at Merthyr Tydfil is subject to a 999-year lease with a pre-paid option to buy
that becomes exercisable in January 2007. Up to that time, the landowner may require us to
purchase the property for a payment of one Pound Sterling.
   11




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##### 



ITEM 3. LEGAL PROCEEDINGS
 Environmental Matters
     Litigation
   
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
  12




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PART II
 
 ITEM 5. MARKET FOR REGISTRANTS COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
   13




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##### 



ITEM 6. SELECTED FINANCIAL DATA
  U.S. CAN CORPORATION AND SUBSIDIARIES
(000s omitted)
 For the Year Ended December 31,2004 (e)
    
    2003 (e)
    
    2002 (e)
    
    2001
    
    2000OPERATING DATA:Net sales
    
    $
    844,779
    
    
    $
    823,442
    
    
    $
    796,557
    
    
    $
    772,188
    
    
    $
    809,497Special charges (a)
    
    
    8,747
    
    
    
    382
    
    
    
    8,921
    
    
    
    36,239
    
    
    
    3,413Recapitalization charge (b)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    18,886Loss from early extinguishment of debt (c)
    
    
    5,508
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    24,167Loss from operations before
cumulative effect of accounting change
    
    
    (29,812
    )
    
    
    (21,917
    )
    
    
    (59,262
    )
    
    
    (40,416
    )
    
    
    (11,522
    )Cumulative effect of accounting change, net of
income taxes (d)
    
    
    
    
    
    
    
    
    
    
    (18,302
    )
    
    
    
    
    
    
    Net loss
    
    
    (29,812
    )
    
    
    (21,917
    )
    
    
    (77,564
    )
    
    
    (40,416
    )
    
    
    (11,522
    )Preferred stock dividend requirement
    
    
    (15,299
    )
    
    
    (13,821
    )
    
    
    (12,521
    )
    
    
    (11,345
    )
    
    
    (2,601
    )Net loss attributable to
common stockholders
    
    $
    (45,111
    )
    
    $
    (35,738
    )
    
    $
    (90,085
    )
    
    $
    (51,761
    )
    
    $
    (14,123
    )BALANCE SHEET DATA:Total assets
    
    $
    557,752
    
    
    $
    573,925
    
    
    $
    580,207
    
    
    $
    634,350
    
    
    $
    637,864Total debt
    
    
    559,996
    
    
    
    559,224
    
    
    
    551,979
    
    
    
    536,776
    
    
    
    495,045Redeemable preferred stock
    
    
    162,253
    
    
    
    146,954
    
    
    
    133,133
    
    
    
    120,613
    
    
    
    109,268Stockholders equity (deficit)
    
    
    (398,429
    )
    
    
    (362,404
    )
    
    
    (349,915
    )
    
    
    (247,124
    )
    
    
    (174,323
    )
  (a)
    
    See Note (4) of the Notes to Consolidated Financial Statements for a description of
the 2004, 2003 and 2002 Special Charges. In 2001, the Company initiated several restructuring
programs consisting of a voluntary termination program, the closure of six manufacturing
facilities and the consolidation of two plastics facilities into a new plastics plant. In
2000, the Company announced a reduction in force program.(b)
    
    On October 4, 2000, the Company and Berkshire Partners LLC completed a recapitalization of
the Company through a merger. As a result of the recapitalization, all of U.S. Cans common
stock, other than certain shares held by designated continuing shareholders, was converted
into the right to receive $20.00 in cash per share and options to purchase approximately 1.6
million shares of U.S. Cans common stock were retired in exchange for a cash payment of
$20.00 per underlying share, less the applicable option price. The Company recorded the $18.9
million charge for expenses related to the recapitalization.(c)
    
    See Note (5) of the Notes to Consolidated Financial Statements for further detail
on the 2004 loss. During 2000, the Company completed a tender offer and consent solicitation
for all of its outstanding 10 1/8% notes due 2006. The early extinguishment of debt in 2000
relates to the tender premium and the write-off of related deferred financing charges.(d)
    
    In accordance with SFAS No. 142 Goodwill and Other Intangible Assets, during 2002,
the Company completed its initial transitional goodwill impairment test and reported that a
non-cash impairment charge was required in its Custom & Specialty and International segments.
The Company recorded a pre-tax goodwill impairment charge of $39.1 million ($18.3 million, net
of tax) during the fourth quarter of 2002. The charge was presented as a cumulative effect of
a change in accounting principle effective as of January 1, 2002. See Note (14) of the Notes
to Consolidated Financial Statements.(e)
    
    Amounts have been restated for the effects of changing the Companys inventory policy from
LIFO to FIFO, see Note (3) of the Notes to Consolidated Financial Statements for further
information on the restatement. The
cumulative effect on years prior to 2002 of applying retroactively the LIFO to FIFO change
in accounting was $16,000, net of tax.
 14




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ITEM 7. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
   Critical Accounting Policies; Use of Estimates
     15




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16




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##### 



Year Ended December 31, 2004 Compared To Year Ended December 31, 2003
 As of December 31,Revenue
    
    
    Gross Profit
    
    
    Percentage to Sales2004
    
    
    2003
    
    
    2004
    
    
    2003
    
    
    2004
    
    
    2003(As Restated)
    
    
    (As Restated)Aerosol
    
    $
    371,625
    
    
    $
    359,246
    
    
    $
    59,736
    
    
    $
    61,058
    
    
    
    16.1
    %
    
    
    17.0
    %International
    
    
    298,077
    
    
    
    287,354
    
    
    
    6,094
    
    
    
    (933
    )
    
    
    2.0
    %
    
    
    (0.3
    )%Paint, Plastic & General Line
    
    
    134,138
    
    
    
    118,909
    
    
    
    13,293
    
    
    
    12,882
    
    
    
    9.9
    %
    
    
    10.8
    %Custom & Specialty
    
    
    40,939
    
    
    
    57,933
    
    
    
    1,096
    
    
    
    3,240
    
    
    
    2.7
    %
    
    
    5.6
    %Total
    
    $
    844,779
    
    
    $
    823,442
    
    
    $
    80,219
    
    
    $
    76,247
    
    
    
    9.5
    %
    
    
    9.3
    %
 Net Sales
  Gross Profit
  17




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Selling, General and Administrative Costs
  Restructuring
  January 1, 2004
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    December 31, 2004(in millions)
    
    Balance
    
    
    Net Additions
    
    
    Cash Deductions
    
    
    Other
    
    
    BalanceEmployee Separation
    
    $
    4.3
    
    
    $
    2.1
    
    
    
    ($3.5
    )
    
    $
    0.3
    (b)
    
    $
    3.2Facility Closing Costs
    
    
    3.6
    
    
    
    1.9
    
    
    
    (1.4
    )
    
    
    
    
    
    
    4.1Asset Write-offs(c)
    
    
    
    
    
    
    4.7
    
    
    
    
    
    
    
    (4.7
    )
    
    
    Total
    
    $
    7.9
    
    
    $
    8.7
    
    
    
    ($4.9
    )
    
    $
    (4.4
    )
    
    $
    7.3
    (a)
  (a)
    
    Includes $3.0 million classified as other long-term liabilities as of December 31, 2004.(b)
    
    Non-cash foreign currency impact(c)
    
    Represents non-cash accelerated depreciation related to the New Castle, PA and Olive Can
facility closings, which was recorded as a reduction in property, plant and equipment.
 Other Income (Expense)
  Interest Expense and Bank Financing Fees; Preferred Stock Dividend Requirements
   18




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Year Ended December 31, 2003 Compared To Year Ended December 31, 2002
 As of December 31,Revenue
    
    
    Gross Profit
    
    
    Percentage to Sales2003
    
    
    2002
    
    
    2003
    
    
    2002
    
    
    2003
    
    
    2002(As Restated)
    
    
    (As Restated)Aerosol
    
    $
    359,246
    
    
    $
    364,133
    
    
    $
    61,058
    
    
    $
    59,559
    
    
    
    17.0
    %
    
    
    16.4
    %International
    
    
    287,354
    
    
    
    241,254
    
    
    
    (933
    )
    
    
    7,788
    
    
    
    (0.3
    )%
    
    
    3.2
    %Paint, Plastic & General Line
    
    
    118,909
    
    
    
    119,952
    
    
    
    12,882
    
    
    
    11,372
    
    
    
    10.8
    %
    
    
    9.5
    %Custom & Specialty
    
    
    57,933
    
    
    
    71,218
    
    
    
    3,240
    
    
    
    725
    
    
    
    5.6
    %
    
    
    1.0
    %Total
    
    $
    823,442
    
    
    $
    796,557
    
    
    $
    76,247
    
    
    $
    79,444
    
    
    
    9.3
    %
    
    
    10.0
    %
 Net Sales
  Gross Profit
  19




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##### 



Selling, General and Administrative Costs
  Interest Expense and Bank Financing Fees; Preferred Stock Dividend Requirements
    LIQUIDITY AND CAPITAL RESOURCES
     20




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21




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22




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##### 



Payments due by periodContractual Obligations (a)
    
    1st year
    
    2-3 years
    
    4-5 years
    
    After 5 years
    
    TotalLong term debt
    
    $
    8,895
    
    
    $
    7,815
    
    
    $
    6,072
    
    
    $
    536,335
    
    
    $
    559,117Capital lease obligations
    
    
    550
    
    
    
    329
    
    
    
    
    
    
    
    
    
    
    
    879Operating leases
    
    
    6,580
    
    
    
    9,451
    
    
    
    7,004
    
    
    
    9,221
    
    
    
    32,256Pension & other
post-retirement employee
benefit obligations (b)
    
    
    5,846
    
    
    
    13,060
    
    
    
    13,143
    
    
    
    
    
    
    
    32,049Other long-term liabilities
on the consolidated balance
sheet
    
    
    4,901
    
    
    
    1,109
    
    
    
    669
    
    
    
    629
    
    
    
    7,308Total Contractual Commitments
    
    $
    26,772
    
    
    $
    31,764
    
    
    $
    26,888
    
    
    $
    546,185
    
    
    $
    631,609
 
 (a)
    
    The aggregate amount of the Companys open purchase obligations is not included in the
Companys contractual obligations table due to the short-term nature and, excluding the
amount that the Company has committed to spend to complete projects included in Construction
in Progress (as discussed previously), the immateriality of the purchase obligations that the
Company is contractually obligated to as of December 31, 2004.(b)
    
    The Companys long-term pension and post-retirement benefit obligations are estimates
based on the Companys current information and are subject to collective bargaining
agreements. The Company reserves the right to make changes to these estimates in the future
as facts and circumstances change and new information is received. Additionally, the amount
of contractual obligations beyond five years is not reliably estimable and is therefore not
included in the table.  INFLATION
    23




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NEW ACCOUNTING PRONOUNCEMENTS
    24




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##### 



ITEM
7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 Foreign Currency Risk
  Interest Rate Risk
   Debt Obligations
    
    2005
    
    2006
    
    2007
    
    2008
    
    2009
    
    Thereafter
    
    Fair Value(dollars in millions)Fixed rate
    
    $
    0.5
    
    
    $
    1.2
    
    
    $
    
    
    
    $
    
    
    
    $
    
    
    
    $
    296.7
    
    
    $
    301.4Average interest rate
    
    
    4.30
    %
    
    
    8.51
    %
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    11.74
    %Variable rate
    
    $
    8.9
    
    
    $
    3.5
    
    
    $
    3.5
    
    
    $
    3.6
    
    
    $
    2.5
    
    
    $
    239.6
    
    
    $
    261.6Average interest rate
    
    
    5.15
    %
    
    
    5.99
    %
    
    
    6.00
    %
    
    
    6.01
    %
    
    
    5.80
    %
    
    
    5.74
    %
 
 25




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##### 



ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
 Page
 Report of Independent Registered Public Accounting Firm
    
    
    27Consolidated Statements of Operations for the Years Ended December 31, 2004 (as restated), 2003 (as restated)
and 2002 (as restated)
    
    
    28Consolidated Balance Sheets as of December 31, 2004 and 2003 (as restated)
    
    
    29Consolidated Statements of Stockholders Equity for the Years Ended December 31, 2004 (as restated),
2003 (as restated) and 2002 (as restated)
    
    
    30Consolidated Statements of Cash Flows for the Years Ended December 31, 2004 (as restated), 2003 (as restated)
and 2002 (as restated)
    
    
    31Notes to Consolidated Financial Statements
    
    
    32
 26




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##### 



REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
  .
    
 27




---



##### 



U.S.
CAN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF OPERATIONS
(000s omitted)
 For the Year EndedAs Restated (See Note (3))December 31,
    
    
    December 31,
    
    
    December 31,2004
    
    
    2003
    
    
    2002Net Sales
    
    $
    844,779
    
    
    $
    823,442
    
    
    $
    796,557Cost of Sales
    
    
    764,560
    
    
    
    747,195
    
    
    
    717,113Gross Profit
    
    
    80,219
    
    
    
    76,247
    
    
    
    79,444Selling, General and Administrative Expenses
    
    
    41,896
    
    
    
    35,986
    
    
    
    38,474Special Charges
    
    
    8,747
    
    
    
    382
    
    
    
    8,921Other Income
    
    
    (2,735
    )
    
    
    (419
    )
    
    
    (215
    )Interest Expense
    
    
    51,232
    
    
    
    54,411
    
    
    
    51,278Bank Financing Fees
    
    
    5,081
    
    
    
    6,118
    
    
    
    4,051Loss on Early Extinguishment of Debt
    
    
    5,508
    
    
    
    
    
    
    
    Loss from Operations Before Income Taxes
and Cumulative Effect of Accounting Change
    
    
    (29,510
    )
    
    
    (20,231
    )
    
    
    (23,065
    )Provision for Income Taxes
    
    
    302
    
    
    
    1,686
    
    
    
    36,197Loss from Operations Before Cumulative
Effect of Accounting Change
    
    
    (29,812
    )
    
    
    (21,917
    )
    
    
    (59,262
    )Cumulative Effect of Accounting Change, net of
income taxes
    
    
    
    
    
    
    
    
    
    
    (18,302
    )Net Loss
    
    
    (29,812
    )
    
    
    (21,917
    )
    
    
    (77,564
    )Preferred Stock Dividend Requirement
    
    
    (15,299
    )
    
    
    (13,821
    )
    
    
    (12,521
    )Net Loss Attributable to Common Stockholders
    
    $
    (45,111
    )
    
    $
    (35,738
    )
    
    $
    (90,085
    )
 
 28




---



##### 



U.S.
CAN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED BALANCE SHEETS
(000s omitted, except per share data)
 As Restated (See Note (3))December 31,
    
    
    December 31,2004
    
    
    2003ASSETSCURRENT ASSETS:Cash and cash equivalents
    
    $
    7,108
    
    
    $
    22,964Accounts receivable, net of allowances
    
    
    78,523
    
    
    
    81,393Inventories, net
    
    
    105,267
    
    
    
    94,342Deferred income taxes
    
    
    7,525
    
    
    
    1,101Other current assets
    
    
    30,811
    
    
    
    13,917Total current assets
    
    
    229,234
    
    
    
    213,717PROPERTY, PLANT AND EQUIPMENT, less accumulated
depreciation and amortization
    
    
    227,022
    
    
    
    247,489GOODWILL
    
    
    27,384
    
    
    
    27,384DEFERRED INCOME TAXES
    
    
    23,199
    
    
    
    30,816OTHER NON-CURRENT ASSETS
    
    
    50,913
    
    
    
    54,519Total assets
    
    $
    557,752
    
    
    $
    573,925LIABILITIES AND STOCKHOLDERS EQUITYCURRENT LIABILITIES:Current maturities of long-term debt and capital lease obligations
    
    $
    9,445
    
    
    $
    23,457Accounts payable
    
    
    100,978
    
    
    
    98,411Accrued expenses
    
    
    55,562
    
    
    
    50,695Restructuring reserves
    
    
    4,347
    
    
    
    3,412Income taxes payable
    
    
    479
    
    
    
    362Total current liabilities
    
    
    170,811
    
    
    
    176,337LONG TERM DEBT
    
    
    550,551
    
    
    
    535,767LONG TERM LIABILITIES PURSUANT TO EMPLOYEE
BENEFIT PLANS
    
    
    68,882
    
    
    
    71,779OTHER LONG-TERM LIABILITIES
    
    
    3,684
    
    
    
    5,492Total liabilities
    
    
    793,928
    
    
    
    789,375REDEEMABLE PREFERRED STOCK, 200,000 shares authorized, 106,667 shares
issued & outstanding
    
    
    162,253
    
    
    
    146,954STOCKHOLDERS EQUITY:Common stock, $10.00 par value, 100,000 shares authorized, 53,333
shares issued & outstanding
    
    
    533
    
    
    
    533Additional paid-in-capital
    
    
    52,800
    
    
    
    52,800Accumulated other comprehensive loss
    
    
    (19,038
    )
    
    
    (28,124
    )Accumulated deficit
    
    
    (432,724
    )
    
    
    (387,613
    )Total stockholders equity / (deficit)
    
    
    (398,429
    )
    
    
    (362,404
    )Total liabilities and stockholders equity
    
    $
    557,752
    
    
    $
    573,925
 
 29




---



##### 



U.S.
CAN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS EQUITY
(000s omitted)
 Accumulated OtherCommon Stock
    
    Paid-in-Capital
    
    Comprehensive Loss
    
    Accumulated Deficit
    
    Comprehensive Income (Loss)BALANCE AT
DECEMBER 31, 2001, as previously reported
    
    $
    533
    
    
    $
    52,800
    
    
    $
    (38,651
    )
    
    $
    (261,806
    )2002 Activity as Restated
(See Note (3)):Adjustment for the
cumulative effect on prior
years of applying
retroactively the LIFO to
FIFO change in accounting
(See Note (2)(c))
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16BALANCE AT
DECEMBER 31, 2001, as restated
    
    
    533
    
    
    
    52,800
    
    
    
    (38,651
    )
    
    
    (261,790
    )Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (77,564
    )
    
    $
    (77,564
    )Unrealized gain on cash flow
hedge
    
    
    
    
    
    
    
    
    
    
    176
    
    
    
    
    
    
    
    176Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,521
    )
    
    
    Equity adjustment to reflect
minimum pension liability
    
    
    
    
    
    
    
    
    
    
    (22,058
    )
    
    
    
    
    
    
    (22,058
    )Currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    9,160
    
    
    
    
    
    
    
    9,160Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (90,286
    )RESTATED BALANCE AT
DECEMBER 31, 2002
    
    
    533
    
    
    
    52,800
    
    
    
    (51,373
    )
    
    
    (351,875
    )2003 Activity as Restated
(See Note (3)):Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (21,917
    )
    
    $
    (21,917
    )Unrealized gain on cash
flow hedge
    
    
    
    
    
    
    
    
    
    
    3,686
    
    
    
    
    
    
    
    3,686Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,821
    )
    
    
    Equity adjustment to reflect
minimum pension liability
    
    
    
    
    
    
    
    
    
    
    3,565
    
    
    
    
    
    
    
    3,565Currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    15,998
    
    
    
    
    
    
    
    15,998Comprehensive income
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    1,332RESTATED BALANCE AT
DECEMBER 31, 2003
    
    
    533
    
    
    
    52,800
    
    
    
    (28,124
    )
    
    
    (387,613
    )2004 Activity as Restated
(See Note (3)):Net loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (29,812
    )
    
    $
    (29,812
    )Preferred stock dividends
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,299
    )
    
    
    Equity adjustment to reflect
minimum pension liability
    
    
    
    
    
    
    
    
    
    
    2,657
    
    
    
    
    
    
    
    2,657Currency translation
adjustment
    
    
    
    
    
    
    
    
    
    
    6,429
    
    
    
    
    
    
    
    6,429Comprehensive loss
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    (20,726
    )BALANCE AT
DECEMBER 31, 2004
    
    $
    533
    
    
    $
    52,800
    
    
    $
    (19,038
    )
    
    $
    (432,724
    )
 
 30




---



##### 



U.S.
CAN CORPORATION AND SUBSIDIARIES
 
 CONSOLIDATED STATEMENTS OF CASH FLOWS
(000s omitted)
 For the Year Ended December 31,As Restated (See Note (3))2004
    
    
    2003
    
    
    2002CASH FLOWS FROM OPERATING ACTIVITIES:Net loss
    
    $
    (29,812
    )
    
    $
    (21,917
    )
    
    $
    (77,564
    )Adjustments to reconcile net loss to net cash provided by
operating activities 
Depreciation and amortization
    
    
    43,725
    
    
    
    38,060
    
    
    
    34,425Special charges
    
    
    8,747
    
    
    
    382
    
    
    
    8,921Loss on early extinguishment of debt
    
    
    5,508
    
    
    

    
    
    
    
    Cumulative effect of accounting change, net of tax
    
    
    
    
    
    
    
    
    
    
    18,302Deferred income taxes
    
    
    (1,521
    )
    
    
    (74
    )
    
    
    35,049Proceeds from accounts receivable factoring
    
    
    3,852
    
    
    
    11,195
    
    
    
    Change in operating assets and liabilities:Accounts receivable
    
    
    (6,956
    )
    
    
    (631
    )
    
    
    12,458Inventories
    
    
    (7,897
    )
    
    
    18,570
    
    
    
    2,704Accounts payable
    
    
    (1,729
    )
    
    
    (10,895
    )
    
    
    (4,101
    )Accrued expenses
    
    
    (1,336
    )
    
    
    (7,494
    )
    
    
    (19,592
    )Other, net
    
    
    (7,070
    )
    
    
    3,556
    
    
    
    (6,785
    )Net cash provided by operating activities
    
    
    5,511
    
    
    
    30,752
    
    
    
    3,817CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures, including restructuring capital
    
    
    (15,901
    )
    
    
    (20,288
    )
    
    
    (27,235
    )Proceeds from sale of property
    
    
    1,191
    
    
    
    5,429
    
    
    
    5,662Dividends from (investment in) Formametal S.A.
    
    
    1,350
    
    
    
    310
    
    
    
    (133
    )Net cash used in investing activities
    
    
    (13,360
    )
    
    
    (14,549
    )
    
    
    (21,706
    )CASH FLOWS FROM FINANCING ACTIVITIES:Repurchase of 12 3/8% notes
    
    
    
    
    
    
    (3,011
    )
    
    
    Issuance of 10 7/8% notes
    
    
    
    
    
    
    125,000
    
    
    
    Borrowing of Term B loan
    
    
    250,000
    
    
    
    
    
    
    
    Payments of Term B loan
    
    
    (1,875
    )
    
    
    
    
    
    
    Net borrowings (payments) under the revolving line of credit
    
    
    (42,100
    )
    
    
    (27,600
    )
    
    
    13,600Payment of Tranche A loan
    
    
    (38,706
    )
    
    
    (27,294
    )
    
    
    (8,000
    )Payment of Tranche B loan
    
    
    (130,175
    )
    
    
    (47,575
    )
    
    
    (1,000
    )Payment of Tranche C loan
    
    
    (20,000
    )
    
    
    
    
    
    
    Borrowing of other debt
    
    
    5,921
    
    
    
    5,901
    
    
    
    12,625Payments of other long-term debt, including capital lease obligations
    
    
    (22,699
    )
    
    
    (19,829
    )
    
    
    (3,168
    )Payment of debt financing costs
    
    
    (6,926
    )
    
    
    (6,938
    )
    
    
    Net cash provided by (used in) financing activities
    
    
    (6,560
    )
    
    
    (1,346
    )
    
    
    14,057EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    (1,447
    )
    
    
    (3,583
    )
    
    
    779INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
    
    
    (15,856
    )
    
    
    11,274
    
    
    
    (3,053
    )CASH AND CASH EQUIVALENTS, beginning of year
    
    
    22,964
    
    
    
    11,690
    
    
    
    14,743CASH AND CASH EQUIVALENTS, end of year
    
    $
    7,108
    
    
    $
    22,964
    
    
    $
    11,690
 
 31




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
 
 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
 DECEMBER 31, 2004, 2003 AND 2002
 (1) Basis of Presentation and Operations
   (2) Summary of Significant Accounting Policies
 Cash
and Cash Equivalents
 Accounts
Receivable and Rebate Allowances
 2004
    
    
    2003
    
    
    2002Balance at beginning of year
    
    $
    16,256
    
    
    $
    16,157
    
    
    $
    12,243Provision for doubtful accounts
    
    
    843
    
    
    
    1,387
    
    
    
    1,420Change in discounts, allowances and rebates
    
    
    (391
    )
    
    
    (975
    )
    
    
    3,438Write-offs of doubtful accounts, net of recoveries
    
    
    (2,221
    )
    
    
    (313
    )
    
    
    (944
    )Balance at end of year
    
    $
    14,487
    
    
    $
    16,256
    
    
    $
    16,157
 Inventories
 32




---



##### 



2004
    
    
    2003(As Restated)Raw materials
    
    $
    35,849
    
    
    $
    21,689Work in progress
    
    
    38,758
    
    
    
    38,310Finished goods
    
    
    30,660
    
    
    
    34,343Total Inventory
    
    $
    105,267
    
    
    $
    94,342
 Property, Plant and Equipment
   2004
    
    
    2003Land
    
    $
    6,455
    
    
    $
    6,410Buildings
    
    
    64,226
    
    
    
    63,828Machinery and equipment
    
    
    485,160
    
    
    
    455,302Capital leases
    
    
    2,861
    
    
    
    8,395Construction in process
    
    
    9,497
    
    
    
    17,577568,199
    
    
    
    551,512Accumulated depreciation and amortization
    
    
    (341,177
    )
    
    
    (304,023
    )Total Property, Plant and Equiment
    
    $
    227,022
    
    
    $
    247,489
 Goodwill

 Bank
Financing Fees
 33




---



##### 



Impairment of Long-Lived Assets
 Revenue
 Customer Rebates
 Foreign
Currency Translation
 Financial Instruments 
 Accumulated
Other Comprehensive Loss
 2004
    
    2003
    
    2002Foreign Currency Translation Adjustment
    
    $
    220
    
    
    $
    (7,479
    )
    
    $
    (25,341
    )Minimum Pension Liability Adjustment
    
    
    (19,258
    )
    
    
    (20,645
    )
    
    
    (22,346
    )Unrealized Loss on Cash Flow Hedges
    
    
    
    
    
    
    
    
    
    
    (3,686
    )Total Accumulated Other Comprehensive Loss
    
    $
    (19,038
    )
    
    $
    (28,124
    )
    
    $
    (51,373
    )
  Stock-Based Compensation 
 34




---



##### 



As Restated For the Years Ended December 31,2004
    
    
    2003
    
    
    2002Net Loss
    
    $
    (29,812
    )
    
    $
    (21,917
    )
    
    $
    (77,564
    )Stock-Based Compensation Cost,
net of tax  fair value method
    
    
    (106
    )
    
    
    (88
    )
    
    
    (151
    )Pro-Forma Net Loss
    
    $
    (29,918
    )
    
    $
    (22,005
    )
    
    $
    (77,715
    )
 New Accounting Pronouncements
 Income
Taxes
 Consolidation
   New
Accounting Pronouncements
 35




---



##### 



Use of Estimates
 36




---



##### 



Accrued Current Liabilities
 (3) Restatement
  For the Years Ended December 31,2004
    
    2003
    
    2002AS
    
    
    
    
    
    AS
    
    
    
    
    
    ASAS
    
    PREVIOUSLY
    
    AS
    
    PREVIOUSLY
    
    AS
    
    PREVIOUSLYRESTATED
    
    REPORTED
    
    RESTATED
    
    REPORTED
    
    RESTATED
    
    REPORTEDCost of Sales
    
    $
    764,560
    
    
    $
    765,358
    
    
    $
    747,195
    
    
    $
    746,246
    
    
    $
    717,113
    
    
    $
    717,237Gross Profit
    
    
    80,219
    
    
    
    79,421
    
    
    
    76,247
    
    
    
    77,196
    
    
    
    79,444
    
    
    
    79,320Loss From Operations Before Income
Taxes and Cumulative Effect of
Accounting Change
    
    
    (29,510
    )
    
    
    (30,308
    )
    
    
    (20,231
    )
    
    
    (19,282
    )
    
    
    (23,065
    )
    
    
    (23,189
    )Provision (Benefit) for Income Taxes
    
    
    302
    
    
    
    (3
    )
    
    
    1,686
    
    
    
    2,049
    
    
    
    36,197
    
    
    
    36,150Net Loss Before Cumulative Effect of
Accounting Change
    
    
    (29,812
    )
    
    
    (30,305
    )
    
    
    (21,917
    )
    
    
    (21,331
    )
    
    
    (59,262
    )
    
    
    (59,339
    )Net Loss
    
    
    (29,812
    )
    
    
    (30,305
    )
    
    
    (21,917
    )
    
    
    (21,331
    )
    
    
    (77,564
    )
    
    
    (77,641
    )Net Loss Attributable to Common
Stockholders
    
    $
    (45,111
    )
    
    $
    (45,604
    )
    
    $
    (35,738
    )
    
    $
    (35,152
    )
    
    $
    (90,085
    )
    
    $
    (90,162
    )
 As of December 31, 2003ASAS
    
    PREVIOUSLYRESTATED
    
    REPORTEDINVENTORIES, NET
    
    $
    94,342
    
    
    $
    95,140DEFERRED INCOME TAXES
    
    
    1,101
    
    
    
    796Total current assets
    
    
    213,717
    
    
    
    214,210Total assets
    
    
    573,925
    
    
    
    574,418STOCKHOLDERS EQUITY / (DEFICIT)
    
    
    (362,404
    )
    
    
    (361,911
    )Total liabilities and stockholders equity
    
    $
    573,925
    
    
    $
    574,418
  37




---



##### 



(4) Special Charges
 2004
    January 1,
    
    
    
    
    
    
    Cash
    
    
    
    
    
    
    December 31,(in millions)
    
    2004 Balance
    
    
    Net Additions
    
    
    Deductions
    
    
    Other
    
    
    2004 BalanceEmployee Separation
    
    $
    4.3
    
    
    $
    2.1
    
    
    
    ($3.5
    )
    
    $
    0.3
    (b)
    
    $
    3.2Facility Closing Costs
    
    
    3.6
    
    
    
    1.9
    
    
    
    (1.4
    )
    
    
    
    
    
    
    4.1Asset Write-offs (c)
    
    
    
    
    
    
    4.7
    
    
    
    
    
    
    
    (4.7
    )
    
    
    Total
    
    $
    7.9
    
    
    $
    8.7
    
    
    
    ($4.9
    )
    
    $
    (4.4
    )
    
    $
    7.3
    (a)
 
 (a)
    
    Includes $3.0 million classified as other long-term liabilities as of December 31, 2004.(b)
    
    Non-cash foreign currency impact(c)
    
    Represents non-cash accelerated depreciation related to the New Castle, PA and Olive Can
facility closings, which was recorded as a reduction in property, plant and equipment. 2003
   38




---



##### 



January 1,
    
    
    Net
    
    
    Cash
    
    
    
    
    
    
    December 31,(in millions)
    
    2003 Balance
    
    
    Additions(c)
    
    
    Deductions
    
    
    Other (b)
    
    
    2003 BalanceEmployee Separation
    
    $
    9.4
    
    
    $
    0.5
    
    
    
    ($6.0
    )
    
    $
    0.4
    
    
    $
    4.3Facility Closing
Costs
    
    
    6.5
    
    
    
    (0.1
    )
    
    
    (2.8
    )
    
    
    
    
    
    
    3.6Total
    
    $
    15.9
    
    
    $
    0.4
    
    
    
    ($8.8
    )
    
    $
    0.4
    
    
    $
    7.9
    (a)
 
 (a)
    
    Includes $4.5 million classified as other long-term liabilities as of December 31, 2003.(b)
    
    Non-cash foreign currency translation impact(c)
    
    Includes reversals of $1.8 million due to the re-assessment of reserves 2002
    January 1,
    
    
    Net
    
    
    
    
    
    
    
    
    
    
    December 31,(in millions)
    
    2002 Balance
    
    
    Additions(d)
    
    
    Deductions(c)
    
    
    Other (b)
    
    
    2002 BalanceEmployee Separation
    
    $
    21.2
    
    
    $
    5.1
    
    
    
    ($17.6
    )
    
    $
    0.7
    
    
    $
    9.4Facility Closing
Costs
    
    
    10.7
    
    
    
    3.8
    
    
    
    (9.6
    )
    
    
    1.6
    
    
    
    6.5Total
    
    $
    31.9
    
    
    $
    8.9
    
    
    
    ($27.2
    )
    
    $
    2.3
    
    
    $
    15.9
    (a)
 
 (a)
    
    Includes $3.7 million classified as other long-term liabilities as of December 31, 2002.(b)
    
    Non-cash foreign currency translation impact and the reversal of $1.5 million of asset
write-offs previously expensed in the 2001 restructuring.(c)
    
    Includes cash payments of $20.8 million. The remaining non-cash deductions represent
increased pension and post-retiree benefits transferred to Other Long-Term Liabilities (see
Notes 9 & 10) and the non-cash loss recorded on the sale of the Daegeling facility.(d)
    
    Includes reversals of $3.2 million due to the re-assessment of reserves. 39




---



##### 



(5) Debt Obligations
  2004
    
    
    2003Senior debt
Revolving line of credit at adjustable interest rate, based on market rates,
due June 21, 2009
    
    $
    
    
    
    $
    42,100Term B term loan at adjustable interest rate, based on market rates,
due January 15, 2010
    
    
    248,125
    
    
    
    Tranche A term loan at adjustable interest rate, based on market rates,
terminated June 21, 2004
    
    
    
    
    
    
    38,706Tranche B term loan at adjustable interest rate, based on market rates,
terminated June 21, 2004
    
    
    
    
    
    
    130,175Tranche C term loan at adjustable interest rate, based on market rates,
terminated June 21, 2004
    
    
    
    
    
    
    20,000Senior Secured Series B Notes at 10 7/8% interest rate, due July 15, 2010
    
    
    125,000
    
    
    
    125,000Secured term loan at adjustable interest rate, based on LIBOR rates,
due May 2004
    
    
    
    
    
    
    16,529Revolving lines of credit, bank overdrafts and other short term borrowings,
at adjustable interest rates, based on market rates
    
    
    5,480
    
    
    
    4,548Industrial revenue bonds at adjustable interest rate, based on market rates,
due February 1, 2015
    
    
    4,000
    
    
    
    4,000Capital lease obligations
    
    
    879
    
    
    
    788Secured term loan at adjustable interest rate, based on market rates,
due serially to February 1, 2009
    
    
    3,948
    
    
    
    4,814Senior Subordinated Series B Notes at 12 3/8% interest rate, due October 1, 2010
    
    
    171,710
    
    
    
    171,710Senior Subordinated Series B Notes at 10 1/8% interest rate, due October 15, 2006
    
    
    854
    
    
    
    854Total Debt
    
    
    559,996
    
    
    
    559,224LessCurrent maturities
    
    
    (9,445
    )
    
    
    (23,457
    )Total long-term debt
    
    $
    550,551
    
    
    $
    535,767
      40




---



##### 




 41




---



##### 



2005
    
    $
    9,4452006
    
    
    4,6422007
    
    
    3,5022008
    
    
    3,5722009
    
    
    2,500Thereafter
    
    
    536,335$
    559,996
    (6) Income Taxes
  2004
    
    
    2003
    
    
    2002(As Restated)
    
    
    (As Restated)
    
    
    (As Restated)CurrentU.S.
    
    $
    435
    
    
    $
    241
    
    
    $
    Foreign
    
    
    1,388
    
    
    
    1,519
    
    
    
    1,148DeferredU.S.
    
    
    (4,711
    )
    
    
    (1,422
    )
    
    
    537Foreign
    
    
    (7,955
    )
    
    
    (14,876
    )
    
    
    (10,206
    )Valuation AllowanceU.S.
    
    
    7,000
    
    
    
    
    
    
    
    Foreign
    
    
    4,145
    
    
    
    16,224
    
    
    
    44,718Total
    
    $
    302
    
    
    $
    1,686
    
    
    $
    36,197
  42




---



##### 



2004
    
    
    2003
    
    
    2002(As Restated)
    
    
    (As Restated)
    
    
    (As Restated)U.S.
    
    $
    (11,603
    )
    
    $
    2,676
    
    
    $
    (1,602
    )Foreign
    
    
    (17,907
    )
    
    
    (22,907
    )
    
    
    (21,463
    )Loss from operations before income taxes and
cumulative effect of accounting change
    
    $
    (29,510
    )
    
    $
    (20,231
    )
    
    $
    (23,065
    )
  2004
    
    
    2003
    
    
    2002(As Restated)
    
    
    (As Restated)
    
    
    (As Restated)Tax benefit computed at the statutory rates
    
    $
    (10,034
    )
    
    $
    (6,881
    )
    
    $
    (7,843
    )Permanent differences
    
    
    4
    
    
    
    (3,277
    )
    
    
    214Reassessment of reserves for liabilities
    
    
    117
    
    
    
    (2,474
    )
    
    
    Incremental foreign taxes
    
    
    260
    
    
    
    (1,835
    )
    
    
    State and local taxes, net of Federal tax effect
    
    
    (325
    )
    
    
    224
    
    
    
    (875
    )Valuation allowance
    
    
    11,145
    
    
    
    16,224
    
    
    
    44,718Other, net
    
    
    (865
    )
    
    
    (295
    )
    
    
    (17
    )Provision for income taxes
    
    $
    302
    
    
    $
    1,686
    
    
    $
    36,197
  43




---



##### 



December 31, 2004
    
    
    December 31, 2003(As Restated)Benefits
    
    
    Obligations
    
    
    Benefits
    
    
    ObligationsRestructuring reserves
    
    $
    2,270
    
    
    
    
    
    
    $
    2,638
    
    
    
    Goodwill
    
    
    13,519
    
    
    
    
    
    
    
    15,083
    
    
    
    Retirement and post-employment benefits
    
    
    21,269
    
    
    
    
    
    
    
    22,956
    
    
    
    Accrued liabilities
    
    
    7,405
    
    
    
    
    
    
    
    5,831
    
    
    
    Tax credit carry-forwards
    
    
    6,065
    
    
    
    
    
    
    
    5,997
    
    
    
    Capitalized leases
    
    
    
    
    
    
    (174
    )
    
    
    307
    
    
    
    Property and equipment
    
    
    
    
    
    
    (27,908
    )
    
    
    
    
    
    
    (30,543
    )Inventory valuation reserves
    
    
    
    
    
    
    (2,590
    )
    
    
    
    
    
    
    (6,162
    )U.S. Federal net operating losses
    
    
    33,105
    
    
    
    
    
    
    
    33,022
    
    
    
    U.S. State net operating losses
    
    
    4,895
    
    
    
    
    
    
    
    4,681
    
    
    
    Foreign net operating losses
    
    
    56,011
    
    
    
    
    
    
    
    46,499
    
    
    
    Other
    
    
    3,560
    
    
    
    (4,865
    )
    
    
    2,526
    
    
    
    (4,540
    )Total deferred income tax benefits (obligations)
    
    
    148,099
    
    
    
    (35,537
    )
    
    
    139,540
    
    
    
    (41,245
    )Valuation allowance
    
    
    (82,560
    )
    
    
    
    
    
    
    (67,394
    )
    
    
    Total
    
    $
    65,539
    
    
    $
    (35,537
    )
    
    $
    72,146
    
    
    $
    (41,245
    )
   (7) Employee Benefit Plans
   44




---



##### 



U.S.
 2004
    
    
    2003Projected benefit obligation at the beginning of the year
    
    $
    42,084
    
    
    $
    39,910Net increase (decrease) during the year attributed to:Service cost
    
    
    1,007
    
    
    
    910Interest cost
    
    
    2,555
    
    
    
    2,510Actuarial losses
    
    
    915
    
    
    
    791Benefits paid
    
    
    (2,341
    )
    
    
    (2,037
    )Plan amendments (a)
    
    
    2,114
    
    
    
    Net increase during the year
    
    
    4,250
    
    
    
    2,174Projected benefit obligation at the end of the year
    
    $
    46,334
    
    
    $
    42,084
 
 (a)
    
    The plan amendment benefit in 2004 is associated with changes made in conjunction with union
contract negotiations at two of the Companys domestic facilities. Non-U.S.
 2004
    
    
    2003Projected benefit obligation at the beginning of the year
    
    $
    79,735
    
    
    $
    68,628Net increase during the year attributed to:Service cost
    
    
    386
    
    
    
    359Interest cost
    
    
    4,771
    
    
    
    4,269Actuarial (gains) losses
    
    
    (3,517
    )
    
    
    2,750Benefits paid
    
    
    (3,946
    )
    
    
    (4,468
    )Plan amendments
    
    
    38
    
    
    
    32Foreign currency translation impact
    
    
    6,054
    
    
    
    8,165Net increase during the year
    
    
    3,786
    
    
    
    11,107Projected benefit obligation at the end of the year
    
    $
    83,521
    
    
    $
    79,735
  U.S.
 2004
    
    
    2003Fair value of plan assets at the beginning of the year
    
    $
    32,450
    
    
    $
    27,544Increase (decrease) during the year:Return on plan assets
    
    
    3,558
    
    
    
    5,827Sponsor contributions
    
    
    1,114
    
    
    
    1,116Benefits paid
    
    
    (2,341
    )
    
    
    (2,037
    )Net increase during the year
    
    
    2,331
    
    
    
    4,906Fair value of plan assets at the end of the year
    
    $
    34,781
    
    
    $
    32,450
 45




---



##### 



Non-U.S.
 2004
    
    
    2003Fair value of plan assets at the beginning of the year
    
    $
    49,157
    
    
    $
    38,826Increase (decrease) during the year:Return on plan assets
    
    
    5,282
    
    
    
    7,254Sponsor contributions
    
    
    2,133
    
    
    
    3,262Participant contributions
    
    
    38
    
    
    
    32Benefits paid
    
    
    (3,946
    )
    
    
    (4,468
    )Foreign currency translation impact
    
    
    3,650
    
    
    
    4,251Net increase during the year
    
    
    7,157
    
    
    
    10,331Fair value of plan assets at the end of the year
    
    $
    56,314
    
    
    $
    49,157
  U.S.
 2004
    
    
    2003Actuarial present value of benefit obligation Vested benefits
    
    $
    (43,091
    )
    
    $
    (39,071
    )Nonvested benefits
    
    
    (3,243
    )
    
    
    (3,013
    )Accumulated benefit obligation
    
    
    (46,334
    )
    
    
    (42,084
    )Fair value of plan assets
    
    
    34,781
    
    
    
    32,450Accumulated benefit obligation in excess of fair
value of plan assets
    
    
    (11,553
    )
    
    
    (9,634
    )Unrecognized net loss
    
    
    5,489
    
    
    
    5,433Unrecognized prior-service costs
    
    
    4,180
    
    
    
    2,553Net amount recognized
    
    $
    (1,884
    )
    
    $
    (1,648
    )Amounts recognized in the consolidated
balance sheet consist of:Accrued benefit liability
    
    $
    (11,553
    )
    
    $
    (9,634
    )Intangible asset
    
    
    4,180
    
    
    
    2,553Deferred tax asset
    
    
    2,141
    
    
    
    2,119Accumulated other comprehensive income
    
    
    3,348
    
    
    
    3,314Net amount recognized
    
    $
    (1,884
    )
    
    $
    (1,648
    )
 Non-U.S.
 2004
    
    
    2003Actuarial present value of benefit obligation Vested benefits
    
    $
    (83,391
    )
    
    $
    (79,418
    )Nonvested benefits
    
    
    (129
    )
    
    
    (221
    )Accumulated benefit obligation
    
    
    (83,520
    )
    
    
    (79,639
    )Additional amounts related to projected
increases in compensation levels
    
    
    (1
    )
    
    
    (96
    )Projected benefit obligation
    
    
    (83,521
    )
    
    
    (79,735
    )Fair value of plan assets
    
    
    56,314
    
    
    
    49,157Projected benefit obligation in excess of fair value of plan assets
    
    
    (27,207
    )
    
    
    (30,578
    )Unrecognized net loss
    
    
    22,779
    
    
    
    26,658Net amount recognized
    
    $
    (4,428
    )
    
    $
    (3,920
    )Amounts recognized in the consolidated balance sheet consist of:Accrued benefit liability
    
    $
    (26,706
    )
    
    $
    (30,221
    )Deferred tax asset (a)
    
    
    6,684
    
    
    
    9,206Accumulated other comprehensive income
    
    
    15,594
    
    
    
    17,095Net amount recognized
    
    $
    (4,428
    )
    
    $
    (3,920
    )
 
 (a)
    
    Prior to recognition of valuation allowance.  46




---



##### 



U.S.
 2004
    
    
    2003
    
    
    2002Service cost
    
    $
    1,007
    
    
    $
    910
    
    
    $
    860Interest cost
    
    
    2,555
    
    
    
    2,510
    
    
    
    2,387Return on assets
    
    
    (2,711
    )
    
    
    (2,276
    )
    
    
    (2,644
    )Recognized loss
    
    
    13
    
    
    
    272
    
    
    
    Recognized prior service cost
    
    
    487
    
    
    
    376
    
    
    
    392Curtailment loss and special termination benefits (a)
    
    
    
    
    
    
    
    
    
    
    2,247Net periodic pension cost
    
    $
    1,351
    
    
    $
    1,792
    
    
    $
    3,242
 
 (a)
    
    The curtailment loss and special termination benefits in 2002 include a plan curtailment
benefit of $1.0 million, special termination benefit of $1.1 million, and recognition of prior
service cost of $0.1 million, associated with the closure of the Burns Harbor lithography facility. Non-U.S.
 2004
    
    
    2003
    
    
    2002Service cost
    
    $
    386
    
    
    $
    359
    
    
    $
    635Interest cost
    
    
    4,771
    
    
    
    4,269
    
    
    
    3,224Return on assets
    
    
    (3,634
    )
    
    
    (2,974
    )
    
    
    (3,301
    )Recognized loss
    
    
    865
    
    
    
    895
    
    
    
    235Recognized prior service cost
    
    
    5
    
    
    
    
    
    
    
    Net periodic pension cost
    
    $
    2,393
    
    
    $
    2,549
    
    
    $
    793
  U.S.
 2004
    
    2003
    
    2002Discount Rate
    
    
    5.90
    %
    
    
    6.25
    %
    
    
    6.75
    %Long-Term Rate of Return on Plan Assets
    
    
    8.50
    %
    
    
    8.50
    %
    
    
    8.50
    %
 Non-U.S.
 2004
    
    2003
    
    2002Discount Rate
    
    4.50  5.75
    %
    
    5.00  5.75
    %
    
    5.00  5.75
    %Long-Term Rate of Return on Plan Assets
    
    
    7.00
    %
    
    
    7.00
    %
    
    
    7.00
    %Rate of Compensation Increase
    
    1.25  3.75
    %
    
    2.50  4.00
    %
    
    2.50  4.00
    %
    47




---



##### 



U.S.
 2004
    
    2003
    
    2002Equity
    
    
    62
    %
    
    
    72
    %
    
    
    71
    %Bond
    
    
    9
    %
    
    
    8
    %
    
    
    10
    %Collateralized Debt Obligations
    
    
    10
    %
    
    
    9
    %
    
    
    11
    %Cash & Cash Equivalents
    
    
    9
    %
    
    
    6
    %
    
    
    3
    %Hedge & Futures Funds
    
    
    10
    %
    
    
    5
    %
    
    
    5
    %
 Non-U.S.
 2004
    
    2003
    
    2002Equity
    
    
    87
    %
    
    
    85
    %
    
    
    80
    %Bond
    
    
    10
    %
    
    
    12
    %
    
    
    15
    %Property
    
    
    2
    %
    
    
    2
    %
    
    
    2
    %Cash & Cash Equivalents
    
    
    1
    %
    
    
    1
    %
    
    
    3
    %
  Cash Equivalent Guidelines
  Fixed Income Guidelines (Bond)
 1 2
 Equity Guidelines
   Alternative Investment Guidelines (Hedge & Futures Funds)
  48




---



##### 



U.S.
    
    Non-U.S.Year
    
    Pension Plan
    
    Pension Plans(Dollars in 000s)2005
    
    $
    2,378
    
    
    $
    4,2122006
    
    
    2,421
    
    
    
    4,2662007
    
    
    2,490
    
    
    
    4,4082008
    
    
    2,594
    
    
    
    4,7002009
    
    
    2,763
    
    
    
    4,2842010-2014
    
    
    16,586
    
    
    
    22,740
   (8) Postretirement Benefit Plans
   2004
    
    
    2003Accumulated postretirement benefit obligations at the beginning
of the year
    
    $
    23,951
    
    
    $
    32,225Net increase (decrease) during the year attributable to:Service cost
    
    
    348
    
    
    
    262Interest cost
    
    
    1,407
    
    
    
    1,487Actuarial (gain) / loss
    
    
    626
    
    
    
    (1,972
    )Benefits paid
    
    
    (2,046
    )
    
    
    (1,884
    )Plan amendments
    
    
    844
    
    
    
    (6,167
    )Net increase / (decrease) for the year
    
    
    1,179
    
    
    
    (8,274
    )Accumulated postretirement benefit obligations at the end of the year
    
    $
    25,130
    
    
    $
    23,951
 49




---



##### 



2004
    
    
    2003Accumulated postretirement benefit obligations:Active employees
    
    $
    8,165
    
    
    $
    7,844Retirees
    
    
    16,965
    
    
    
    16,107Total accumulated postretirement benefit obligations
    
    
    25,130
    
    
    
    23,951Unrecognized net loss
    
    
    (5,278
    )
    
    
    (4,843
    )Unrecognized prior-service cost benefit
    
    
    7,638
    
    
    
    9,387Net liability recognized
    
    $
    27,490
    
    
    $
    28,495
  2004
    
    
    2003
    
    
    2002Service cost
    
    $
    348
    
    
    $
    262
    
    
    $
    407Interest cost
    
    
    1,407
    
    
    
    1,487
    
    
    
    1,734Recognized loss
    
    
    191
    
    
    
    138
    
    
    
    Recognized prior-service cost
    
    
    (905
    )
    
    
    (904
    )
    
    
    (382
    )Curtailment and Special termination benefit
    
    
    
    
    
    
    
    
    
    
    1,206Net periodic postretirement benefit cost
    
    $
    1,041
    
    
    $
    983
    
    
    $
    2,965
  2004
    
    2003
    
    2002Discount Rate
    
    
    5.90
    %
    
    
    6.25
    %
    
    
    6.75
    %Health Care Cost Trend Rate
    
    7.004.00
    %
    
    8.004.00
    %
    
    9.00 4.00
    %
   50




---



##### 



PostretirementYear
    
    Benefit Plan(in 000's)2005
    
    $
    2,2462006
    
    
    2,1082007
    
    
    2,1242008
    
    
    2,0952009
    
    
    2,1252010-2014
    
    
    10,314
   (9) Commitments and Contingencies
 Environmental
  51




---



##### 



Legal
   Leases
    Capital
    
    
    OperatingLeases
    
    
    Leases2005
    
    $
    577
    
    
    $
    6,5802006
    
    
    334
    
    
    
    5,2032007
    
    
    
    
    
    
    4,2482008
    
    
    
    
    
    
    3,7602009
    
    
    
    
    
    
    3,244Thereafter
    
    
    
    
    
    
    9,221Total minimum lease payments
    
    
    911
    
    
    $
    32,256Amount representing interest
    
    
    (32
    )Present value of net minimum capital lease payments
    
    $
    879
 (10) Equity Incentive Plans
  52




---



##### 



Options Outstanding
    
    
    Exercisable OptionsWtd. Avg.
    
    
    
    
    
    
    Wtd. Avg.Exercise
    
    
    
    
    
    
    ExerciseShares (in 000s)
    
    
    Price
    
    
    Shares (in 000s)
    
    
    PriceDecember 31, 2001
    
    
    2,242.920
    
    
    
    1,000
    
    
    
    325.547
    
    
    $
    1,000Granted
    
    
    25.000
    
    
    
    1,000Exercised
    
    
    
    
    
    
    Canceled
    
    
    (461.186
    )
    
    
    1,000December 31, 2002
    
    
    1,806.734
    
    
    
    1,000
    
    
    
    551.744
    
    
    $
    1,000Granted
    
    
    600.000
    
    
    
    1,000Exercised
    
    
    
    
    
    
    Canceled
    
    
    (223.055
    )
    
    
    1,000December 31, 2003
    
    
    2,183.679
    
    
    
    1,000
    
    
    
    654.107
    
    
    $
    1,000Granted
    
    
    
    
    
    
    Exercised
    
    
    
    
    
    
    Canceled
    
    
    (505.256
    )
    
    
    1,000December 31, 2004
    
    
    1,678.423
    
    
    
    1,000
    
    
    
    961.058
    
    
    $
    1,000
 Exercisable OptionsOptions Outstanding
    
    
    
    
    
    
    at December 31,at December 31, 2004
    
    
    
    
    
    
    2004Remaining
    
    
    Wtd.
    
    
    
    
    
    
    Wtd.Contractual
    
    
    Avg.
    
    
    
    
    
    
    Avg.Life
    
    
    Exercise
    
    
    
    
    
    
    ExerciseExercise Price
    
    Shares
    
    
    (Years)
    
    
    Price
    
    
    Shares
    
    
    Price$1,000.00
    
    
    1,678.423
    
    
    
    6.82
    
    
    $
    1,000.00
    
    
    
    961.058
    
    
    $
    1,000.00
  (11) Redeemable Preferred Stock
   
    
    the bankruptcy of the Company
 53




---



##### 




    
    the acceleration of debt under any major loan agreement to which the Company or
any of its subsidiaries is a party; or
    
    public offerings of shares of capital stock of the Company
   (12) Related Parties
     (13) Subsequent Events
   (14) Goodwill
  54




---



##### 



GoodwillCarrying ValueAerosol
    
    $
    7,255Paint, Plastic & General Line
    
    
    20,129Balance, December 31, 2004
    
    $
    27,384
 (15) Business Segments
    UnitedStates
    
    
    Europe
    
    
    Consolidated2004Net sales
    
    $
    546,702
    
    
    $
    298,077
    
    
    $
    844,779Long-lived assets
    
    
    177,120
    
    
    
    114,802
    
    
    
    291,9222003Net sales
    
    $
    536,088
    
    
    $
    287,354
    
    
    $
    823,442Long-lived assets
    
    
    193,887
    
    
    
    118,517
    
    
    
    312,4042002Net sales
    
    $
    555,303
    
    
    $
    241,254
    
    
    $
    796,557Long-lived assets
    
    
    196,784
    
    
    
    109,884
    
    
    
    306,668
 55




---



##### 



2004
    
    
    2003
    
    
    2002(As Restated)
    
    
    (As Restated)
    
    
    (As Restated)Revenues from external customers:Aerosol
    
    $
    371,625
    
    
    $
    359,246
    
    
    $
    364,133International
    
    
    298,077
    
    
    
    287,354
    
    
    
    241,254Paint, Plastic, & General Line
    
    
    134,138
    
    
    
    118,909
    
    
    
    119,952Custom & Specialty
    
    
    40,939
    
    
    
    57,933
    
    
    
    71,218Total revenues
    
    $
    844,779
    
    
    $
    823,442
    
    
    $
    796,557Income (loss) from operations before income taxes
and cumulative effect of accounting change:Aerosol
    
    $
    59,736
    
    
    $
    61,058
    
    
    $
    59,559International
    
    
    (10,450
    )
    
    
    (12,660
    )
    
    
    (6,539
    )Paint, Plastic, & General Line
    
    
    13,293
    
    
    
    12,882
    
    
    
    11,372Custom & Specialty
    
    
    1,096
    
    
    
    3,240
    
    
    
    725Total Segment Income From Operations
    
    
    63,675
    
    
    
    64,520
    
    
    
    65,117Unallocated Selling, General & Administrative Expenses (a)
    
    
    (25,352
    )
    
    
    (24,259
    )
    
    
    (24,147
    )Special Charges (b)
    
    
    (8,747
    )
    
    
    (382
    )
    
    
    (8,921
    )Other Income (c)
    
    
    2,735
    
    
    
    419
    
    
    
    215Interest Expense
    
    
    (51,232
    )
    
    
    (54,411
    )
    
    
    (51,278
    )Bank Financing Fees
    
    
    (5,081
    )
    
    
    (6,118
    )
    
    
    (4,051
    )Loss on Early Extinguishment of Debt
    
    
    (5,508
    )
    
    
    
    
    
    
    Total loss from operations before income taxes and
cumulative effect of accounting change
    
    $
    (29,510
    )
    
    $
    (20,231
    )
    
    $
    (23,065
    )Capital spending:Aerosol
    
    $
    5,413
    
    
    $
    10,912
    
    
    $
    6,879International
    
    
    3,532
    
    
    
    2,766
    
    
    
    11,996Paint, Plastic, & General Line
    
    
    5,187
    
    
    
    3,843
    
    
    
    3,770Custom & Specialty
    
    
    444
    
    
    
    1,778
    
    
    
    3,002Corporate
    
    
    1,325
    
    
    
    989
    
    
    
    1,588Total capital spending
    
    $
    15,901
    
    
    $
    20,288
    
    
    $
    27,235Depreciation and amortization:Aerosol
    
    $
    13,749
    
    
    $
    12,227
    
    
    $
    12,014International
    
    
    14,311
    
    
    
    11,990
    
    
    
    8,521Paint, Plastic, & General Line
    
    
    6,062
    
    
    
    5,856
    
    
    
    5,561Custom & Specialty
    
    
    2,779
    
    
    
    1,810
    
    
    
    1,942Corporate
    
    
    6,824
    
    
    
    6,177
    
    
    
    6,387Total depreciation and amortization
    
    $
    43,725
    
    
    $
    38,060
    
    
    $
    34,425Identifiable assets:Aerosol
    
    $
    167,760
    
    
    $
    166,645
    
    
    $
    166,136International
    
    
    215,429
    
    
    
    212,126
    
    
    
    220,376Paint, Plastic, & General Line
    
    
    80,156
    
    
    
    77,073
    
    
    
    80,566Custom & Specialty
    
    
    15,911
    
    
    
    24,679
    
    
    
    27,087Corporate
    
    
    78,496
    
    
    
    93,402
    
    
    
    86,042Total identifiable assets
    
    $
    557,752
    
    
    $
    573,925
    
    
    $
    580,207
 
 (a)
    
    Represents United States Selling, General & Administrative expenses. The Company does
not allocate these costs to its domestic segments.(b)
    
    Management does not evaluate segment performance including such charges. See Note (4)
for further information on the Companys special charges. 56




---



##### 



(c)
    
    Other income represents the Companys share of the net income of its joint venture equity
investment in Argentina, and dividends, other income and sale proceeds related to an
investment in operations that were formerly owned by the Company. The Company does not
allocate such income to its segments. (16) Subsidiary Guarantor Information
    57




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
CONSOLIDATING STATEMENT OF OPERATIONS
 RESTATED FOR THE YEAR ENDED DECEMBER 31, 2004
(000s omitted)
 USC Europe/Restated
    
    
    USC May
    
    
    MayRestated
    
    
    United States
    
    
    Verpackungen
    
    
    Verpackungen
    
    
    
    
    
    
    RestatedU.S. Can
    
    
    Can
    
    
    Holding
    
    
    GmbH (Non-
    
    
    
    
    
    
    U.S. CanCorporation
    
    
    Company
    
    
    (Subsidiary
    
    
    Guarantor
    
    
    Restated
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    Eliminations
    
    
    ConsolidatedNET SALES
    
    $
    
    
    
    $
    546,702
    
    
    $
    
    
    
    $
    298,077
    
    
    $
    
    
    
    $
    844,779COST OF SALES
    
    
    
    
    
    
    472,577
    
    
    
    (340
    )
    
    
    292,323
    
    
    
    
    
    
    
    764,560Gross profit
    
    
    
    
    
    
    74,125
    
    
    
    340
    
    
    
    5,754
    
    
    
    
    
    
    
    80,219SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    
    
    
    
    25,352
    
    
    
    
    
    
    
    16,544
    
    
    
    
    
    
    
    41,896SPECIAL CHARGES
    
    
    
    
    
    
    7,546
    
    
    
    
    
    
    
    1,201
    
    
    
    
    
    
    
    8,747OTHER INCOME
    
    
    
    
    
    
    (2,099
    )
    
    
    
    
    
    
    (636
    )
    
    
    
    
    
    
    (2,735
    )INTEREST EXPENSE
    
    
    
    
    
    
    44,551
    
    
    
    5,412
    
    
    
    1,269
    
    
    
    
    
    
    
    51,232BANK FINANCING FEES
    
    
    
    
    
    
    4,869
    
    
    
    
    
    
    
    212
    
    
    
    
    
    
    
    5,081LOSS ON EARLY
EXTINGUISHMENT OF DEBT
    
    
    
    
    
    
    5,508
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    5,508EQUITY LOSS FROM SUBSIDIARY
    
    
    (29,812
    )
    
    
    (15,486
    )
    
    
    (586
    )
    
    
    
    
    
    
    45,884
    
    
    
    Loss before income taxes
    
    
    (29,812
    )
    
    
    (27,088
    )
    
    
    (5,658
    )
    
    
    (12,836
    )
    
    
    45,884
    
    
    
    (29,510
    )PROVISION (BENEFIT) FOR
INCOME TAXES
    
    
    
    
    
    
    2,724
    
    
    
    105
    
    
    
    (2,527
    )
    
    
    
    
    
    
    302NET LOSS
    
    
    (29,812
    )
    
    
    (29,812
    )
    
    
    (5,763
    )
    
    
    (10,309
    )
    
    
    45,884
    
    
    
    (29,812
    )PREFERRED STOCK DIVIDENDS
    
    
    (15,299
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (15,299
    )NET LOSS ATTRIBUTABLE TO
COMMON STOCKHOLDERS
    
    $
    (45,111
    )
    
    $
    (29,812
    )
    
    $
    (5,763
    )
    
    $
    (10,309
    )
    
    $
    45,884
    
    
    $
    (45,111
    )
 58




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
CONSOLIDATING STATEMENT OF OPERATIONS
 RESTATED FOR THE YEAR ENDED DECEMBER 31, 2003
(000s omitted)
 USC Europe/Restated
    
    
    USC May
    
    
    MayRestated
    
    
    United States
    
    
    Verpackungen
    
    
    Verpackungen
    
    
    
    
    
    
    RestatedU.S. Can
    
    
    Can
    
    
    Holding
    
    
    GmbH(Non-
    
    
    
    
    
    
    U.S. CanCorporation
    
    
    Company
    
    
    (Subsidiary
    
    
    Guarantor
    
    
    Restated
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    Eliminations
    
    
    ConsolidatedNET SALES
    
    $
    
    
    
    $
    536,088
    
    
    $
    
    
    
    $
    287,354
    
    
    $
    
    
    
    $
    823,442COST OF SALES
    
    
    
    
    
    
    458,908
    
    
    
    (374
    )
    
    
    288,661
    
    
    
    
    
    
    
    747,195Gross profit
    
    
    
    
    
    
    77,180
    
    
    
    374
    
    
    
    (1,307
    )
    
    
    
    
    
    
    76,247SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    
    
    
    
    24,259
    
    
    
    
    
    
    
    11,727
    
    
    
    
    
    
    
    35,986SPECIAL CHARGES
    
    
    
    
    
    
    (580
    )
    
    
    
    
    
    
    962
    
    
    
    
    
    
    
    382OTHER INCOME
    
    
    
    
    
    
    (63
    )
    
    
    
    
    
    
    (356
    )
    
    
    
    
    
    
    (419
    )INTEREST EXPENSE
    
    
    
    
    
    
    44,799
    
    
    
    6,384
    
    
    
    3,228
    
    
    
    
    
    
    
    54,411BANK FINANCING FEES
    
    
    
    
    
    
    6,090
    
    
    
    
    
    
    
    28
    
    
    
    
    
    
    
    6,118EQUITY EARNINGS (LOSS) FROM
SUBSIDIARY
    
    
    (21,917
    )
    
    
    (25,773
    )
    
    
    (7,375
    )
    
    
    
    
    
    
    55,065
    
    
    
    Loss before income taxes
    
    
    (21,917
    )
    
    
    (23,098
    )
    
    
    (13,385
    )
    
    
    (16,896
    )
    
    
    55,065
    
    
    
    (20,231
    )PROVISION (BENEFIT) FOR
INCOME TAXES
    
    
    
    
    
    
    (1,181
    )
    
    
    2,931
    
    
    
    (64
    )
    
    
    
    
    
    
    1,686NET LOSS
    
    
    (21,917
    )
    
    
    (21,917
    )
    
    
    (16,316
    )
    
    
    (16,832
    )
    
    
    55,065
    
    
    
    (21,917
    )PREFERRED STOCK DIVIDENDS
    
    
    (13,821
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,821
    )NET LOSS ATTRIBUTABLE TO
COMMON STOCKHOLDERS
    
    $
    (35,738
    )
    
    $
    (21,917
    )
    
    $
    (16,316
    )
    
    $
    (16,832
    )
    
    $
    55,065
    
    
    $
    (35,738
    )
 59




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
CONSOLIDATING STATEMENT OF OPERATIONS
 RESTATED FOR THE YEAR ENDED DECEMBER 31, 2002
(000s omitted)
 USC Europe/Restated
    
    USC May
    
    MayRestated
    
    United States
    
    Verpackungen
    
    Verpackungen
    
    
    
    
    
    RestatedU.S. Can
    
    Can
    
    Holding
    
    GmbH (Non-
    
    
    
    
    
    U.S. CanCorporation
    
    Company
    
    (Subsidiary
    
    Guarantor
    
    Restated
    
    Corporation(Parent)
    
    (Issuer)
    
    Guarantor)
    
    Subsidiaries)
    
    Eliminations
    
    ConsolidatedNET SALES
    
    $
    
    
    
    $
    555,303
    
    
    $
    
    
    
    $
    241,254
    
    
    $
    
    
    
    $
    796,557COST OF SALES
    
    
    
    
    
    
    483,648
    
    
    
    (406
    )
    
    
    233,871
    
    
    
    
    
    
    
    717,113Gross profit
    
    
    
    
    
    
    71,655
    
    
    
    406
    
    
    
    7,383
    
    
    
    
    
    
    
    79,444SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES
    
    
    
    
    
    
    24,146
    
    
    
    
    
    
    
    14,328
    
    
    
    
    
    
    
    38,474SPECIAL CHARGES
    
    
    
    
    
    
    3,080
    
    
    
    
    
    
    
    5,841
    
    
    
    
    
    
    
    8,921OTHER INCOME
    
    
    
    
    
    
    (125
    )
    
    
    
    
    
    
    (90
    )
    
    
    
    
    
    
    (215
    )INTEREST EXPENSE
    
    
    
    
    
    
    42,105
    
    
    
    6,465
    
    
    
    2,708
    
    
    
    
    
    
    
    51,278BANK FINANCING FEES
    
    
    
    
    
    
    4,051
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    4,051EQUITY EARNINGS (LOSS) FROM
SUBSIDIARY
    
    
    (77,564
    )
    
    
    (65,736
    )
    
    
    (19,837
    )
    
    
    
    
    
    
    163,137
    
    
    
    Loss before income taxes
    
    
    (77,564
    )
    
    
    (67,338
    )
    
    
    (25,896
    )
    
    
    (15,404
    )
    
    
    163,137
    
    
    
    (23,065
    )PROVISION FOR INCOME TAXES
    
    
    
    
    
    
    2,052
    
    
    
    22,197
    
    
    
    11,948
    
    
    
    
    
    
    
    36,197NET LOSS BEFORE
CUMULATIVE EFFECT OF
ACCOUNTING CHANGE
    
    
    (77,564
    )
    
    
    (69,390
    )
    
    
    (48,093
    )
    
    
    (27,352
    )
    
    
    163,137
    
    
    
    (59,262
    )CUMULATIVE EFFECT OF ACCOUNTING
CHANGE, NET OF TAX
    
    
    
    
    
    
    (8,174
    )
    
    
    4,717
    
    
    
    (14,845
    )
    
    
    
    
    
    
    (18,302
    )NET LOSS
    
    
    (77,564
    )
    
    
    (77,564
    )
    
    
    (43,376
    )
    
    
    (42,197
    )
    
    
    163,137
    
    
    
    (77,564
    )PREFERRED STOCK DIVIDENDS
    
    
    (12,521
    )
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (12,521
    )NET LOSS ATTRIBUTABLE TOCOMMON STOCKHOLDERS
    
    $
    (90,085
    )
    
    $
    (77,564
    )
    
    $
    (43,376
    )
    
    $
    (42,197
    )
    
    $
    163,137
    
    
    $
    (90,085
    )
 60




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2004
(000s omitted)
 USC Europe/USC May
    
    MayVerpackungen
    
    VerpackungenU.S. Can

    
    United States

    
    Holding

    
    GmbH (Non-

    
    
    
    
    
    U.S. CanCorporation

    
    Can Company

    
    (Subsidiary

    
    Guarantor

    
    
    
    
    
    Corporation(Parent)
    
    (Issuer)

    
    Guarantor)

    
    Subsidiaries)

    
    Eliminations

    
    ConsolidatedCURRENT ASSETS:Cash and cash equivalents
    
    $
    
    
    
    $
    927
    
    
    $
    
    
    
    $
    6,181
    
    
    $
    
    
    
    $
    7,108Accounts receivable
    
    
    
    
    
    
    50,115
    
    
    
    
    
    
    
    28,408
    
    
    
    
    
    
    
    78,523Inventories
    
    
    
    
    
    
    62,861
    
    
    
    
    
    
    
    42,406
    
    
    
    
    
    
    
    105,267Deferred income taxes
    
    
    
    
    
    
    6,660
    
    
    
    
    
    
    
    865
    
    
    
    
    
    
    
    7,525Other current assets
    
    
    
    
    
    
    8,376
    
    
    
    
    
    
    
    22,435
    
    
    
    
    
    
    
    30,811Total current assets
    
    
    
    
    
    
    128,939
    
    
    
    
    
    
    
    100,295
    
    
    
    
    
    
    
    229,234NET PROPERTY, PLANT AND
EQUIPMENT
    
    
    
    
    
    
    126,418
    
    
    
    
    
    
    
    100,604
    
    
    
    
    
    
    
    227,022GOODWILL
    
    
    
    
    
    
    27,384
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,384DEFERRED INCOME TAXES
    
    
    
    
    
    
    22,867
    
    
    
    
    
    
    
    332
    
    
    
    
    
    
    
    23,199OTHER NON-CURRENT ASSETS
    
    
    
    
    
    
    36,715
    
    
    
    
    
    
    
    14,198
    
    
    
    
    
    
    
    50,913INTERCOMPANY
ADVANCES
    
    
    
    
    
    
    286,028
    
    
    
    
    
    
    
    
    
    
    
    (286,028
    )
    
    
    INVESTMENT IN
SUBSIDIARIES
    
    
    
    
    
    
    
    
    
    
    64,954
    
    
    
    
    
    
    
    (64,954
    )
    
    
    Total assets
    
    $
    
    
    
    $
    628,351
    
    
    $
    64,954
    
    
    $
    215,429
    
    
    $
    (350,982
    )
    
    $
    557,752CURRENT LIABILITIESCurrent maturities of
long-term debt
    
    $
    
    
    
    $
    3,965
    
    
    $
    
    
    
    $
    5,480
    
    
    $
    
    
    
    $
    9,445Accounts payable
    
    
    
    
    
    
    41,716
    
    
    
    
    
    
    
    59,262
    
    
    
    
    
    
    
    100,978Restructuring reserves
    
    
    
    
    
    
    1,947
    
    
    
    
    
    
    
    2,400
    
    
    
    
    
    
    
    4,347Income taxes payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    479
    
    
    
    
    
    
    
    479Other current liabilities
    
    
    
    
    
    
    39,244
    
    
    
    
    
    
    
    16,318
    
    
    
    
    
    
    
    55,562Total current liabilities
    
    
    
    
    
    
    86,872
    
    
    
    
    
    
    
    83,939
    
    
    
    
    
    
    
    170,811TOTAL LONG TERM DEBT
    
    
    854
    
    
    
    549,697
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    550,551LONG-TERM LIABILITIES PURSUANT
TO EMPLOYEE BENEFIT PLANS
    
    
    
    
    
    
    41,652
    
    
    
    591
    
    
    
    26,639
    
    
    
    
    
    
    
    68,882OTHER LONG-TERM
LIABILITIES
    
    
    
    
    
    
    2,782
    
    
    
    
    
    
    
    902
    
    
    
    
    
    
    
    3,684PREFERRED STOCK
    
    
    162,253
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    162,253INTERCOMPANY LOANS
    
    
    112,057
    
    
    
    
    
    
    
    127,111
    
    
    
    46,860
    
    
    
    (286,028
    )
    
    
    INVESTMENT IN
SUBSIDIARIES
    
    
    123,265
    
    
    
    70,613
    
    
    
    
    
    
    
    
    
    
    
    (193,878
    )
    
    
    STOCKHOLDERS EQUITY
    
    
    (398,429
    )
    
    
    (123,265
    )
    
    
    (62,748
    )
    
    
    57,089
    
    
    
    128,924
    
    
    
    (398,429
    )Total liabilities and
stockholders equity
    
    $
    
    
    
    $
    628,351
    
    
    $
    64,954
    
    
    $
    215,429
    
    
    $
    (350,982
    )
    
    $
    557,752
 61




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 CONDENSED CONSOLIDATING BALANCE SHEET
Restated As of December 31, 2003
(000s omitted)
 USC Europe/USC May
    
    
    MayRestated
    
    
    Restated
    
    
    Verpackungen
    
    
    Verpackungen
    
    
    
    
    
    
    RestatedU.S. Can
    
    
    United States
    
    
    Holding
    
    
    GmbH (Non-
    
    
    
    
    
    
    U.S. CanCorporation
    
    
    Can Company
    
    
    (Subsidiary
    
    
    Guarantor
    
    
    Restated
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    Eliminations
    
    
    ConsolidatedCURRENT ASSETS:Cash and cash equivalents
    
    $
    
    
    
    $
    16,854
    
    
    $
    
    
    
    $
    6,110
    
    
    $
    
    
    
    $
    22,964Accounts receivable
    
    
    
    
    
    
    44,157
    
    
    
    
    
    
    
    37,236
    
    
    
    
    
    
    
    81,393Inventories
    
    
    
    
    
    
    51,941
    
    
    
    
    
    
    
    42,401
    
    
    
    
    
    
    
    94,342Deferred income taxes
    
    
    
    
    
    
    971
    
    
    
    
    
    
    
    130
    
    
    
    
    
    
    
    1,101Other current assets
    
    
    
    
    
    
    6,460
    
    
    
    
    
    
    
    7,457
    
    
    
    
    
    
    
    13,917Total current assets
    
    
    
    
    
    
    120,383
    
    
    
    
    
    
    
    93,334
    
    
    
    
    
    
    
    213,717NET PROPERTY, PLANT AND
EQUIPMENT
    
    
    
    
    
    
    143,777
    
    
    
    
    
    
    
    103,712
    
    
    
    
    
    
    
    247,489GOODWILL
    
    
    
    
    
    
    27,384
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    27,384DEFERRED INCOME TAXES
    
    
    
    
    
    
    30,685
    
    
    
    
    
    
    
    131
    
    
    
    
    
    
    
    30,816OTHER NON-CURRENT ASSETS
    
    
    
    
    
    
    39,570
    
    
    
    
    
    
    
    14,949
    
    
    
    
    
    
    
    54,519INTERCOMPANY
ADVANCES
    
    
    
    
    
    
    260,962
    
    
    
    
    
    
    
    
    
    
    
    (260,962
    )
    
    
    INVESTMENT IN
SUBSIDIARIES
    
    
    
    
    
    
    
    
    
    
    61,961
    
    
    
    
    
    
    
    (61,961
    )
    
    
    Total assets
    
    $
    
    
    
    $
    622,761
    
    
    $
    61,961
    
    
    $
    212,126
    
    
    $
    (322,923
    )
    
    $
    573,925CURRENT LIABILITIESCurrent maturities of
long-term debt
    
    $
    
    
    
    $
    2,379
    
    
    $
    
    
    
    $
    21,078
    
    
    $
    
    
    
    $
    23,457Accounts payable
    
    
    
    
    
    
    42,237
    
    
    
    
    
    
    
    56,174
    
    
    
    
    
    
    
    98,411Restructuring reserves
    
    
    
    
    
    
    2,831
    
    
    
    
    
    
    
    581
    
    
    
    
    
    
    
    3,412Income taxes payable
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    362
    
    
    
    
    
    
    
    362Other current liabilities
    
    
    
    
    
    
    35,683
    
    
    
    
    
    
    
    15,012
    
    
    
    
    
    
    
    50,695Total current liabilities
    
    
    
    
    
    
    83,130
    
    
    
    
    
    
    
    93,207
    
    
    
    
    
    
    
    176,337TOTAL LONG TERM DEBT
    
    
    854
    
    
    
    534,913
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    535,767LONG-TERM LIABILITIES PURSUANT
TO EMPLOYEE BENEFIT PLANS
    
    
    
    
    
    
    41,069
    
    
    
    930
    
    
    
    29,780
    
    
    
    
    
    
    
    71,779OTHER LONG-TERM
LIABILITIES
    
    
    
    
    
    
    2,594
    
    
    
    
    
    
    
    2,898
    
    
    
    
    
    
    
    5,492PREFERRED STOCK
    
    
    146,954
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    146,954INTERCOMPANY LOANS
    
    
    112,056
    
    
    
    
    
    
    
    121,595
    
    
    
    27,311
    
    
    
    (260,962
    )
    
    
    INVESTMENT IN
SUBSIDIARIES
    
    
    102,540
    
    
    
    63,595
    
    
    
    
    
    
    
    
    
    
    
    (166,135
    )
    
    
    STOCKHOLDERS EQUITY
    
    
    (362,404
    )
    
    
    (102,540
    )
    
    
    (60,564
    )
    
    
    58,930
    
    
    
    104,174
    
    
    
    (362,404
    )Total liabilities and
stockholders equity
    
    $
    
    
    
    $
    622,761
    
    
    $
    61,961
    
    
    $
    212,126
    
    
    $
    (322,923
    )
    
    $
    573,925
 62




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
RESTATED FOR THE YEAR ENDED DECEMBER 31, 2004
(000s omitted)
 RestatedUSC Europe /USC May
    
    
    MayUnited
    
    
    Verpackungen
    
    
    Verpackungen
    
    
    RestatedU.S. Can
    
    
    States Can
    
    
    Holding
    
    
    (Non-
    
    
    U.S. CanCorporation
    
    
    Company
    
    
    (Subsidiary-
    
    
    Guarantor
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    ConsolidatedCASH FLOWS FROM OPERATING ACTIVITIES
    
    $
    
    
    
    $
    9,626
    
    
    $
    (6,105
    )
    
    $
    1,990
    
    
    $
    5,511CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    
    
    
    
    (12,370
    )
    
    
    
    
    
    
    (3,531
    )
    
    
    (15,901
    )Proceeds on the sale of property
    
    
    
    
    
    
    1,086
    
    
    
    
    
    
    
    105
    
    
    
    1,191Dividends from Formametal S.A.
    
    
    
    
    
    
    1,350
    
    
    
    
    
    
    
    
    
    
    
    1,350Net cash used in investing activities
    
    
    
    
    
    
    (9,934
    )
    
    
    
    
    
    
    (3,426
    )
    
    
    (13,360
    )CASH FLOWS FROM FINANCING ACTIVITIES:Changes in intercompany advances
    
    
    
    
    
    
    (25,062
    )
    
    
    6,105
    
    
    
    18,957
    
    
    
    Borrowing of Term B loan
    
    
    
    
    
    
    250,000
    
    
    
    
    
    
    
    
    
    
    
    250,000Payments of Term B loan
    
    
    
    
    
    
    (1,875
    )
    
    
    
    
    
    
    
    
    
    
    (1,875
    )Net payments under the revolving line of credit
    
    
    
    
    
    
    (42,100
    )
    
    
    
    
    
    
    
    
    
    
    (42,100
    )Payment of Tranche A loan
    
    
    
    
    
    
    (38,706
    )
    
    
    
    
    
    
    
    
    
    
    (38,706
    )Payment of Tranche B loan
    
    
    
    
    
    
    (130,175
    )
    
    
    
    
    
    
    
    
    
    
    (130,175
    )Payment of Tranche C loan
    
    
    
    
    
    
    (20,000
    )
    
    
    
    
    
    
    
    
    
    
    (20,000
    )Borrowings of other debt
    
    
    
    
    
    
    1,026
    
    
    
    
    
    
    
    4,895
    
    
    
    5,921Payments of other long-term debt
    
    
    
    
    
    
    (1,801
    )
    
    
    
    
    
    
    (20,898
    )
    
    
    (22,699
    )Payments of debt financing costs
    
    
    
    
    
    
    (6,926
    )
    
    
    
    
    
    
    
    
    
    
    (6,926
    )Net cash (used in) provided by financing activities
    
    
    
    
    
    
    (15,619
    )
    
    
    6,105
    
    
    
    2,954
    
    
    
    (6,560
    )EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (1,447
    )
    
    
    (1,447
    )INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS
    
    
    
    
    
    
    (15,927
    )
    
    
    
    
    
    
    71
    
    
    
    (15,856
    )CASH AND CASH EQUIVALENTS, beginning of year
    
    
    
    
    
    
    16,854
    
    
    
    
    
    
    
    6,110
    
    
    
    22,964CASH AND CASH EQUIVALENTS, end of period
    
    $
    
    
    
    $
    927
    
    
    $
    
    
    
    $
    6,181
    
    
    $
    7,108
 63




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
RESTATED FOR THE YEAR ENDED DECEMBER 31, 2003
(000s omitted)
 RestatedUSC Europe /USC May
    
    
    MayUnited
    
    
    Verpackungen
    
    
    Verpackungen
    
    
    RestatedU.S. Can
    
    
    States Can
    
    
    Holding
    
    
    (Non-
    
    
    U.S. CanCorporation
    
    
    Company
    
    
    (Subsidiary-
    
    
    Guarantor
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    ConsolidatedCASH FLOWS FROM OPERATING ACTIVITIES
    
    $
    
    
    
    $
    23,099
    
    
    $
    (14,101
    )
    
    $
    21,754
    
    
    $
    30,752CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    
    
    
    
    (17,523
    )
    
    
    
    
    
    
    (2,765
    )
    
    
    (20,288
    )Proceeds on the sale of property
    
    
    
    
    
    
    256
    
    
    
    
    
    
    
    5,173
    
    
    
    5,429Dividends from Formametal S.A.
    
    
    
    
    
    
    310
    
    
    
    
    
    
    
    
    
    
    
    310Net cash used in investing activities
    
    
    
    
    
    
    (16,957
    )
    
    
    
    
    
    
    2,408
    
    
    
    (14,549
    )CASH FLOWS FROM FINANCING ACTIVITIES:Changes in intercompany advances
    
    
    
    
    
    
    (11,312
    )
    
    
    14,101
    
    
    
    (2,789
    )
    
    
    Issuance of 10 7/8% senior secured notes
    
    
    
    
    
    
    125,000
    
    
    
    
    
    
    
    
    
    
    
    125,000Repurchase of 12 3/8% senior subordinated notes
    
    
    
    
    
    
    (3,011
    )
    
    
    
    
    
    
    
    
    
    
    (3,011
    )Net payments under the revolving line of credit
    
    
    
    
    
    
    (27,600
    )
    
    
    
    
    
    
    
    
    
    
    (27,600
    )Payment of Tranche A loan
    
    
    
    
    
    
    (27,294
    )
    
    
    
    
    
    
    
    
    
    
    (27,294
    )Payment of Tranche B loan
    
    
    
    
    
    
    (47,575
    )
    
    
    
    
    
    
    
    
    
    
    (47,575
    )Borrowings of other debt
    
    
    
    
    
    
    4,814
    
    
    
    
    
    
    
    1,087
    
    
    
    5,901Payments of other long-term debt
    
    
    
    
    
    
    (1,079
    )
    
    
    
    
    
    
    (18,750
    )
    
    
    (19,829
    )Payments of debt financing costs
    
    
    
    
    
    
    (6,938
    )
    
    
    
    
    
    
    
    
    
    
    (6,938
    )Net cash (used in) provided by financing activities
    
    
    
    
    
    
    5,005
    
    
    
    14,101
    
    
    
    (20,452
    )
    
    
    (1,346
    )EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (3,583
    )
    
    
    (3,583
    )INCREASE IN CASH AND
CASH EQUIVALENTS
    
    
    
    
    
    
    11,147
    
    
    
    
    
    
    
    127
    
    
    
    11,274CASH AND CASH EQUIVALENTS, beginning of year
    
    
    
    
    
    
    5,707
    
    
    
    
    
    
    
    5,983
    
    
    
    11,690CASH AND CASH EQUIVALENTS, end of period
    
    $
    
    
    
    $
    16,854
    
    
    $
    
    
    
    $
    6,110
    
    
    $
    22,964
 64




---



##### 



U.S. CAN CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS  (Continued)
 CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED DECEMBER 31, 2002
(000s omitted)
 USC Europe /USC May
    
    
    MayUnited
    
    
    Verpackungen
    
    
    VerpackungenU.S. Can
    
    
    States Can
    
    
    Holding
    
    
    (Non-
    
    
    U.S. CanCorporation
    
    
    Company
    
    
    (Subsidiary-
    
    
    Guarantor
    
    
    Corporation(Parent)
    
    
    (Issuer)
    
    
    Guarantor)
    
    
    Subsidiaries)
    
    
    ConsolidatedCASH FLOWS FROM OPERATING ACTIVITIES
    
    $
    
    
    
    $
    19,114
    
    
    $
    (41,410
    )
    
    $
    26,113
    
    
    $
    3,817CASH FLOWS FROM INVESTING ACTIVITIES:Capital expenditures
    
    
    
    
    
    
    (15,239
    )
    
    
    
    
    
    
    (11,996
    )
    
    
    (27,235
    )Proceeds on the sale of property
    
    
    
    
    
    
    817
    
    
    
    
    
    
    
    4,845
    
    
    
    5,662Investment in Formametal S.A.
    
    
    
    
    
    
    (133
    )
    
    
    
    
    
    
    
    
    
    
    (133
    )Net cash used in investing activities
    
    
    
    
    
    
    (14,555
    )
    
    
    
    
    
    
    (7,151
    )
    
    
    (21,706
    )CASH FLOWS FROM FINANCING ACTIVITIES:Changes in intercompany advances
    
    
    
    
    
    
    (10,195
    )
    
    
    41,410
    
    
    
    (31,215
    )
    
    
    Net borrowings under the revolving line of credit
    
    
    
    
    
    
    13,600
    
    
    
    
    
    
    
    
    
    
    
    13,600Borrowing of long-term debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,625
    
    
    
    12,625Payments of long-term debt, including capital lease
obligations
    
    
    
    
    
    
    (10,506
    )
    
    
    
    
    
    
    (1,662
    )
    
    
    (12,168
    )Net cash (used in) provided by financing activities
    
    
    
    
    
    
    (7,101
    )
    
    
    41,410
    
    
    
    (20,252
    )
    
    
    14,057EFFECT OF EXCHANGE RATE CHANGES ON CASH
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    779
    
    
    
    779DECREASE IN CASH AND
CASH EQUIVALENTS
    
    
    
    
    
    
    (2,542
    )
    
    
    
    
    
    
    (511
    )
    
    
    (3,053
    )CASH AND CASH EQUIVALENTS, beginning of year
    
    
    
    
    
    
    8,249
    
    
    
    
    
    
    
    6,494
    
    
    
    14,743CASH AND CASH EQUIVALENTS, end of period
    
    $
    
    
    
    $
    5,707
    
    
    $
    
    
    
    $
    5,983
    
    
    $
    11,690
 65




---



##### 



(17) Quarterly Financial Data (Unaudited)
  Third
    
    
    FourthFirst Quarter
    
    
    Second Quarter
    
    
    Quarter
    
    
    QuarterAs Previously
    
    
    
    
    
    
    As PreviouslyRestated
    
    
    Reported
    
    
    Restated
    
    
    Reported2004
    
    
    2004
    
    
    2004
    
    
    2004
    
    
    2004
    
    
    2004Third
    
    
    FourthNet Sales
    
    $
    213,467
    
    
    $
    213,467
    
    
    $
    211,809
    
    
    $
    211,809
    
    
    $
    207,263
    
    
    $
    212,240Gross Profit
    
    
    19,844
    
    
    
    19,372
    
    
    
    19,234
    
    
    
    18,908
    
    
    
    21,922
    
    
    
    19,219Special Charges(a)
    
    
    482
    
    
    
    482
    
    
    
    922
    
    
    
    922
    
    
    
    4,012
    
    
    
    3,331Net Loss
    
    
    (4,670
    )
    
    
    (4,961
    )
    
    
    (9,588
    )
    
    
    (9,790
    )
    
    
    (5,275
    )
    
    
    (10,279
    )Net Loss
Attributable to
Common Shareholders
    
    $
    (8,494
    )
    
    $
    (8,785
    )
    
    $
    (13,348
    )
    
    $
    (13,550
    )
    
    $
    (9,128
    )
    
    $
    (14,141
    )
    First Quarter
    
    
    Second Quarter
    
    
    Third Quarter
    
    
    Fourth QuarterAs PreviouslyRestated
    
    
    Reported2003
    
    
    2003
    
    
    2003
    
    
    2003
    
    
    2003Net Sales
    
    $
    199,153
    
    
    $
    210,623
    
    
    $
    204,671
    
    
    $
    208,995
    
    
    $
    208,995Gross Profit
    
    
    20,275
    
    
    
    21,113
    
    
    
    17,714
    
    
    
    17,145
    
    
    
    18,094Special Charges (a)
    
    
    758
    
    
    
    592
    
    
    
    (760
    )
    
    
    (208
    )
    
    
    (208
    )Net Loss
    
    
    (4,432
    )
    
    
    (4,055
    )
    
    
    (7,101
    )
    
    
    (6,329
    )
    
    
    (5,744
    )Net Loss
Attributable to
Common Shareholders
    
    $
    (7,678
    )
    
    $
    (7,455
    )
    
    $
    (10,586
    )
    
    $
    (10,019
    )
    
    $
    (9,434
    )
   66




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##### 



ITEM 9.
    
    CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE
  
 ITEM 9A.
    
    CONTROLS AND PROCEDURES
        67




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##### 



§
    
    In December 2004, the Company hired a new Finance Director for its Laon,
France facility.§
    
    The Company has hired an internal auditor to provide internal audit
services for the Company, including the Companys European operations.§
    
    The Company continues the process of implementing a detailed system at each
European location to provide support to the audit process, including reports,
checklists and site visits.
    68




---



##### 



PART III
 
 ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
  Name
    
    Age
    
    PositionCarl Ferenbach
    
    
    62
    
    
    Director, Co-Chairman of the BoardGeorge V. Bayly
    
    
    62
    
    
    Director, Co-Chairman of the BoardPhilip R. Mengel
    
    
    60
    
    
    Director, Chief Executive OfficerThomas A. Scrimo
    
    
    56
    
    
    Executive Vice President and General Manager,
Business Units of the AmericasSarah T. Macdonald
    
    
    40
    
    
    Senior Vice President, Sales and MarketingLarry S. Morrison
    
    
    51
    
    
    Senior Senior Vice President, Metal
Manufacturing and Lithography OperationsRobert L. Burkhardt
    
    
    45
    
    
    Vice President and ControllerEmil P. Obradovich
    
    
    58
    
    
    Vice President and Chief Technical OfficerThomas J. Olander
    
    
    56
    
    
    Vice President, Human ResourcesSheleen Quish
    
    
    56
    
    
    Vice President and Chief Information OfficerRichard K. Lubin
    
    
    58
    
    
    DirectorFrancisco A. Soler
    
    
    59
    
    
    DirectorLouis B. Susman
    
    
    67
    
    
    Director
 Carl Ferenbach.
 George V. Bayly.
 Philip R. Mengel.
 Thomas A. Scrimo.
 69




---



##### 



Sarah T. Macdonald.
 Larry S. Morrison.
 Robert L. Burkhardt.
 Emil P. Obradovich.
 Thomas J. Olander.
 Sheleen Quish.
 Richard K. Lubin.
 Francisco A. Soler.
 Louis B. Susman.
 Audit Committee Financial Expert
  70




---



##### 



Code of Ethics
  71




---



##### 



ITEM 11. EXECUTIVE COMPENSATION
  Summary Compensation Table
 Long Term CompensationAnnual Compensation
    
    Awards
    
    PayoutSecuritiesUnderlyingOther Annual
    
    Options/SARs
    
    All OtherName and Principal Position
    
    Year
    
    Salary
    
    Bonus
    
    Compensation
    
    (#)(c)
    
    CompensationGeorge V. Bayly (e)
    
    
    2004
    
    
    $
    345,915
    
    
    $
    
    
    
    $
    2,621
    
    
    none
    
    $
    6,212
    (a)Chief Executive Officer1Thomas A. Scrimo
    
    
    2004
    
    
    $
    323,738
    
    
    $
    30,000
    
    
    $
    8,652
    
    
    none
    
    $
    12,381
    (a)Executive Vice President and G.M.,
    
    
    2003
    
    
    $
    287,869
    
    
    $
    
    
    
    $
    5,506
    
    
    none
    
    $
    14,563
    (b)Aerosol, Paint & Business Support
    
    
    2002
    
    
    $
    252,677
    
    
    $
    35,000
    
    
    $
    5,506
    
    
    none
    
    $
    14,478
    (c)Sarah T. Macdonald
    
    
    2004
    
    
    $
    230,162
    
    
    $
    55,000
    
    
    $
    5,718
    
    
    none
    
    $
    6,715
    (a)Senior Vice President, Sales
    
    
    2003
    
    
    $
    159,792
    
    
    $
    19,500
    
    
    $
    5,045
    
    
    none
    
    $
    6,858
    (b)and Marketing
    
    
    2002
    
    
    $
    123,062
    
    
    $
    20,000
    
    
    $
    5,506
    
    
    none
    
    $
    4,262
    (c)Sandra K. Vollman (f)
    
    
    2004
    
    
    $
    244,777
    
    
    $
    
    
    
    $
    5,718
    
    
    none
    
    $
    7,988
    (a)Senior Vice President and Chief
    
    
    2003
    
    
    $
    224,792
    
    
    $
    
    
    
    $
    5,506
    
    
    none
    
    $
    8,306
    (b)Financial Officer
    
    
    2002
    
    
    $
    203,446
    
    
    $
    20,000
    
    
    $
    5,506
    
    
    none
    
    $
    16,219
    (c)Anthony P. MacLaurin (e)
    
    
    2004
    
    
    $
    166,013
    
    
    $
    81,250
    
    
    $
    2,732
    
    
    none
    
    $
    2,674
    (a)Executive Vice President,
InternationalFrancois Vissers (f)
    
    
    2004
    
    
    $
    173,366
    
    
    $
    
    
    
    $
    
    
    
    none
    
    $
    186,430
    (d)Senior Vice President, Intl and
    
    
    2003
    
    
    $
    341,037
    
    
    $
    
    
    
    $
    7,049
    
    
    none
    
    $
    
    (d)President of European Operations
    
    
    2002
    
    
    $
    270,948
    
    
    $
    31,102
    
    
    $
    5,457
    
    
    none
    
    $
    
    (d)John L. Workman (f)
    
    
    2004
    
    
    $
    188,469
    
    
    $
    
    
    
    $
    2,144
    
    
    none
    
    $
    390,317
    (a)Former Chief Executive Officer
    
    
    2003
    
    
    $
    521,377
    
    
    $
    
    
    
    $
    6,194
    
    
    none
    
    $
    26,681
    (b)2002
    
    
    $
    424,723
    
    
    $
    45,000
    
    
    $
    7,215
    
    
    none
    
    $
    24,148
    (c)
 
 1
 (a)
    
    2004 amounts shown for Messrs. Bayly, Scrimo, Ms. Vollman, Mr. MacLaurin and Mr. Workman
include contributions or payments for their benefit to U.S. Can Corporations Salaried
Employee Savings and Retirement Accumulation Plan (SRAP) and pursuant to nonqualified
retirement plans ($6,212, $12,381, $7,988, $738 and $13,356 respectively). The 2004 amount
shown for Mr. Workman also includes payments made by the Company of $376,962 to Mr. Workman in
accordance with his Severance Agreement. The amount for Ms. Macdonald represents
contributions to the UK Pension Plan of $6,715. Included in the 2004 amount for Mr.
MacLaurin is $1,936 for executive expenses.(b)
    
    2003 amounts shown for Mr. Scrimo, Ms. Vollman and Mr. Workman include contributions or
payments for their benefit to U.S. Can Corporations Salaried Employee Savings and Retirement
Accumulation Plan (SRAP) and 72




---



##### 



pursuant to nonqualified retirement plans ($14,563, $8,306 and $26,681 respectively). The
amount for Ms. Macdonald represents contributions to the UK Pension Plan of $6,858.(c)
    
    2002 amounts shown for Mr. Scrimo, Ms. Vollman and Mr. Workman include contributions or
payments for their benefit to U.S. Can Corporations Salaried Employee Savings and Retirement
Accumulation Plan (SRAP) and pursuant to nonqualified retirement plans ($14,478, $16,219 and
$24,148 respectively). The amount for Ms. Macdonald represents contributions to the UK
Pension Plan of $4,262.(d)
    
    Mr. Vissers is compensated partially in euros and partially in British pounds. The amounts
shown for Mr. Vissers have been converted to U.S. dollars at the applicable exchange rate in
effect as of the calendar year-end for the year in which payment was made. During 2003 and
2002 the Company did not make any contributions for the benefit of Mr. Vissers to any type of
executive retirement plan or overseas employee benefit trust. All such contributions were
made by Mr. Vissers through salary deductions. The 2004 amount shown for Mr. Vissers also
includes payments made by the Company of $172,268 in accordance with his Severance Agreement.(e)
    
    Mr. Bayly was appointed the Companys Chief Executive Officer in April 2004. Prior to April
2004, Mr. Bayly consulted with the Company for which he was compensated $93,333, excluding
board fees. Mr. MacLaurin joined the Company in July 2004.(f)
    
    Mr. Vissers employment terminated on August 31, 2004, and Mr. Workmans employment
terminated on April 22, 2004. Effective March 1, 2005, Ms. Vollman resigned from the Company. Option Grants
  Aggregated Option/SAR Exercises in 2004 and 2004-End Option/SAR Values
  Number of SecuritiesUnderlying
    
    Value of UnexercisedUnexercised Options
    
    In-The-Money Optionsat 2004-Year End (#)
    
    at 2004-Year End ($)(a)Name
    
    Exercisable/Unexercisable
    
    Exercisable/UnexercisableGeorge Bayly
    
    
    166.67/333.33
    
    
    $
    0/$0Thomas A. Scrimo
    
    
    181.08/158.44
    
    
    $
    0/$0Sarah T. Macdonald
    
    
    45.270/11.317
    
    
    $
    0/$0Sandra K. Vollman (b)
    
    
    113.17/28.294
    
    
    $
    0/$0Anthony P. MacLaurin
    
    
    00.000/00.000
    
    
    $
    0/$0Francois Vissers (c)
    
    
    00.000/00.000
    
    
    $
    0/$0John L. Workman (d)
    
    
    00.000/00.000
    
    
    $
    0/$0
 
 (a)
    
    There was no established trading market for U.S. Can Corporations common stock as of
December 31, 2004. Management has determined that the fair market value of the common stock
underlying these options did not exceed $1,000.00 (the exercise price of these options)
and, accordingly, none of the options were in-the-money.(b)
    
    Ms. Vollman resigned from the Company on March 1, 2005. In accordance with her
separation agreement, her options expired on March 1, 2005.(c)
    
    Mr. Vissers resigned from the Company on August 31, 2004. In accordance with his
separation agreement, his options expired on December 14, 2004. 73




---



##### 



(d)
    
    Mr. Workman resigned from the Company on April 22, 2004. In accordance with his
separation agreement, his options expired on August 5, 2004. Compensation of Directors
 Directors Fees
  Committee Fees
  Other Fees
  Compensation Committee Interlocks and Insider Participation
    (1)
    
    as a member of the compensation committee of any entity that
has one or more executive officers serving as a member of our Compensation
Committee;(2)
    
    as a member of the board of directors of any entity that has
one or more executive officers serving as a member of our Compensation
Committee; and(3)
    
    as a member of the compensation committee of any entity that
has one or more executive officers serving as a member of our Board of
Directors.
 74




---



##### 



Transactions with Management
 Executive Severance Plan
  U.S. Can Corporation 2000 Equity Incentive Plan
  Change in Control Agreements
  
    
    a severance payment equal to one times the greater of his current annual base
salary or the annual base salary immediately before the change in control;
    
    a pro-rated bonus based on the target bonus; and
    
    continuation of health and welfare benefits for one year following
termination.
 Employment Agreements with Messrs. MacLaurin and Scrimo
 Employment Agreement with Mr. Scrimo
   (1)
    
    an amount equal to one years base salary reduced by any amounts received
from any life or disability insurance provided by us; and(2)
    
    if he is entitled to receive a bonus payment under the management incentive
plan, a bonus payment prorated to reflect any partial year of employment.
  75




---



##### 



(1)
    
    his base salary and benefits for the earliest to occur of 18 months, his
death or the date that he breaches the provisions of his employee agreement (relating
to non-competition, confidentiality and inventions); and(2)
    
    if he is entitled to receive a bonus payment under the management incentive
plan, a bonus payment prorated to reflect any partial year of employment.
  Employment Agreement with Mr. MacLaurin
   (1)
    
    his base salary during the period of disability reduced by any amounts
received from any life or disability insurance provided by us; and(2)
    
    if he is entitled to receive a bonus payment under the management incentive
plan, a bonus payment prorated to reflect any partial year of employment.
  (1)
    
    his base salary earned but not paid through the date of termination;(2)
    
    any vacation time earned but not paid through the date of termination;(3)
    
    any business expenses incurred but not reimbursed on the date of termination;
and,(4)
    
    if he is entitled to receive a bonus payment under the management incentive
plan, a bonus payment prorated to reflect any partial year of employment.
  (1)
    
    his base salary and benefits for the earlier to occur of 18 months or the
date that he breaches the provisions of his employment agreement (relating to
non-competition, confidentiality and inventions);(2)
    
    if he is entitled to receive a bonus payment under the management incentive
plan, a bonus payment prorated to reflect any partial year of employment;(3)
    
    if permitted under applicable law and plan terms, continuing his participation
and that of his eligible dependents in our medical and dental plans for 18 months
following the termination date, at a level of coverage and contribution generally
applicable to our other executives; and(4)
    
    up to $25,000 for reasonable outplacement services until the earlier that he
obtains other employment or one year.
 76




---



##### 



Compensation Arrangement with Mr. Mengel
  Compensation Arrangement with Mr. Bayly
  Separation Agreement with Ms. Vollman
  (a)
    
    a lump sum stay bonus equal to nine months of her salary and car allowance at
the rate in effect as of December 22, 2004; and(b)
    
    an award, if any, to her under our Management Incentive Plan based on actual
performance for 2004.(c)
    
    waiving our exercise of the call right of any securities held by her on the
Separation Date.
  Separation Agreement with Mr. Vissers
  (1)
    
    a statutory redundancy payment;(2)
    
    a lump sum payment equal to twelve months of his salary, including car
allowance and pension contribution, less tax sums paid by the Company on his behalf to
the United Kingdom Inland Revenue;(3)
    
    waiving our exercise of the call right of any securities held by him on the
Separation Date; and(4)
    
    an aggregate of up to £675 plus VAT for reasonable attorneys fees, costs and
expenses.
  77




---



##### 



Separation Agreement with Mr. Workman
  (1)
    
    his salary for a period of 18 months after the Separation Date;(2)
    
    an award, if any, to him under our Management Incentive Plan for the
performance period in which the Separation Date occurred, subject to a pro rata
reduction for the period following the Separation Date;(3)
    
    an extension of his ability to exercise vested options beyond the period
provided for in our 2000 Equity Incentive Plan;(4)
    
    an aggregate of up to $13,000 for reasonable attorneys fees, costs and
expenses;(5)
    
    up to $25,000 for reasonable outplacement services until he obtains other
employment;(6)
    
    continuing his participation and that of his eligible dependents in our medical
and dental plans for 18 months following the Separation Date, if he was enrolled as of
the Separation Date, at a level of coverage no less favorable than that offered to our
other executives; and(7)
    
    waiving our exercise of the call right of any securities held by him on the
Separation Date.
  78




---



##### 



ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
   Number of securitiesremaining available forNumber of securities to be
    
    Weighted-average exercise
    
    future issuance underissued upon exercise of
    
    price of outstanding
    
    equity compensation plansoutstanding options,
    
    options, warrants and
    
    (excluding securitiesPlan Category
    
    warrants and rights
    
    rights
    
    reflected in column (a)(a)
    
    (b)
    
    (c)Equity
compensation plans
approved by
security holders
    
    
    1,678.423
    
    
    
    1,000.000
    
    
    
    1,575.338Equity
compensation plans
not approved by
security holders
    
    
    
    
    
    
    
    
    
    
    Total
    
    
    1,678.423
    
    
    
    1,000.000
    
    
    
    1,575.338
 th
     79




---



##### 



Beneficial Owner
    
    Number of Shares
    
    Percent OwnershipBerkshire Partners LLC (1)
    
    
    41,229.278
    
    
    
    77.30
    %George V. Bayly (2)
    
    
    166.667
    
    
    
    *Philip R. Mengel (2)
    
    
    33.333
    
    
    
    *Thomas A. Scrimo (3)
    
    
    394.412
    
    
    
    *Sarah T. Macdonald (2)
    
    
    45.270
    
    
    
    *Larry S. Morrison (2)
    
    
    45.270
    
    
    
    *Francois Vissers
    
    
    
    
    
    
    *John L. Workman
    
    
    1,000.000
    
    
    
    1.88Carl Ferenbach (4)
    
    
    41,229.278
    
    
    
    77.30Richard K. Lubin (4)
    
    
    41,229.278
    
    
    
    77.30Francisco A. Soler (5)
    
    
    951.485
    
    
    
    1.78Louis B. Susman (6)
    
    
    2,613.332
    
    
    
    4.90All officers and directors as a group (14 persons) (7)
    
    
    45,600.903
    
    
    
    85.50
 
 *
    
    Less than 1%(1)
    
    Includes 25,847.737 shares of common stock held by Berkshire Fund V Limited Partnership;
2,584.771 shares of common stock held by Berkshire Investors LLC; and 12,796.770 shares of
common stock held by Berkshire Fund V Coinvestment Fund, Limited Partnership. The address of
Berkshire Partners LLC is One Boston Place, Suite 3300, Boston, Massachusetts 02108.(2)
    
    Number of shares represents currently exercisable options.(3)
    
    Includes 181.078 shares subject to currently exercisable options.(4)
    
    Mr. Ferenbach and Mr. Lubin are Managing Directors of Berkshire Partners LLC.(5)
    
    Mr. Soler beneficially owns 951.485 shares of U.S. Can Corporation common stock as a result
of his relationship to (i) Windsor International Corporation, a company of which Mr. Soler is
a director and executive officer and which is the record holder of 424.460 shares, (ii) Atlas
World Carriers S.A., a company of which Mr. Soler is a director and executive officer and
which is the record holder of 250.172 shares, (iii) The World Financial Corporation S.A., a
company of which Mr. Soler is a director and executive officer and which is the record holder
of 250.172 shares, and (iv) Scarsdale Company N.V., Inc., a company of which Mr. Soler is an
executive officer and which is the record holder of 26.681 shares.(6)
    
    Mr. Susman beneficially owns 2,613.332 shares of common stock as a result of his relationship
to Citigroup. Mr. Susman is the Vice Chairman of Investment Banking and Managing Director of
Citigroup Global Markets Inc. Citigroup and its affiliates are the record holder of 2,613.332
shares of common stock.(7)
    
    Includes 593.474 shares subject to currently exercisable options. 80




---



##### 



ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
  Relationship with Berkshire Partners
   Relationship with Citigroup
  Stockholders Agreement
  
    
    Prior to the third anniversary of the closing of the recapitalization
in October 2000, no stockholder may transfer shares of U.S. Can
Corporation capital stock (other than limited exceptions including
permitted transfers to an affiliate or in connection with estate
planning).
    
    After the third anniversary of the closing of the recapitalization, a
stockholder may only transfer shares of U.S. Can Corporation capital
stock (other than limited exceptions including permitted transfers to
an affiliate or in connection with estate planning) after the
transferring stockholder first gives U.S. Can Corporation, and then
the other stockholders on a pro rata basis, a right of first refusal
to purchase all or a portion of the shares at the same price.
    
    U.S. Can Corporation has the right to purchase U.S. Can Corporation
equity securities held by a management stockholder (as defined) in the
event the management stockholders employment with U.S. Can
Corporation is terminated for any reason.
    
    If a management stockholders employment with U.S. Can Corporation is
terminated by virtue of death, disability or retirement in accordance
with U.S. Can Corporation policy, the management stockholder will have
the right to require U.S. Can Corporation to purchase his or her
equity securities of U.S. Can Corporation.
 81




---



##### 




    
    If, at any time, specified stockholders holding 75% of the outstanding
common stock equivalents (as defined) (i.e., Berkshire Partners, its
affiliates and another stockholder) elect to consummate the sale of
50% or more of the common stock of U.S. Can Corporation to an
unaffiliated third party, the remaining stockholders will be obligated
to consent to and take all actions necessary to complete the proposed
sale of the same proportion of their stock on the same terms.
    
    After the third anniversary of the closing of the recapitalization, a
stockholder (or a group of stockholders together) owning more than 4%
of the outstanding shares of U.S. Can Corporation capital stock may
only (other than in connection with estate planning transfers)
transfer the shares to an unaffiliated third party, so long as other
stockholders are given the option to participate in the proposed
transfer on the same terms and conditions on a pro rata basis (except
in connection with transfers permitted by the stockholders agreement).
    
    The stockholders have agreed to elect directors of U.S. Can
Corporation such that the Board of Directors will consist of two
designees of Berkshire and its affiliates so long as the Berkshire
stockholders maintain ownership of at least 25% of the U.S. Can
Corporation common stock, two designees of management stockholders,
Louis Susman, Ricardo Poma, Francisco Soler (or another designee of
the Scarsdale Group if Francisco Soler and Ricardo Poma both no longer
serve on the Board of Directors so long as the Scarsdale Group owns at
least 5% of the U.S. Can Corporation common stock) and up to two other
independent directors acceptable to the other directors. Mr. Poma
resigned from membership on the Board in April 2001 and chose not to
designate a replacement.
    
    Following an initial public offering of U.S. Can Corporation common
stock, specified stockholders will have either one or two demand
registration rights. The stockholders will be entitled to piggy-back
registration rights on all registrations of U.S. Can Corporation
common stock by U.S. Can Corporation or any other stockholder, subject
to customary underwriter cutback.
    
    So long as U.S. Can Corporation is not paying default interest under
any of its financing arrangements, an 80% vote of the common
stockholders will be required to approve and adopt mergers,
acquisitions, charter or bylaw amendments, extraordinary borrowings,
dividends, stock issuances and other specified matters. An 80% vote
will be required at all times for a financial restructuring that
treats the management stockholders differently and adversely from the
rest of the common stockholders.
    
    Stockholders have pre-emptive rights to subscribe for newly
issued shares on a pro rata basis, subject to certain exclusions.
    
    Most of the restrictions contained in the stockholders agreements
terminate upon consummation of a qualified initial public offering of
common stock by U.S. Can Corporation or specified changes in control
of U.S. Can Corporation.
 Preferred Stock
  Dividends.
 Voting Rights.
 82




---



##### 



Ranking.
 Redemption.
 
    
    the bankruptcy of either U.S. Can Corporation or United States Can Company;
    
    the acceleration of debt under any major loan agreement to which U.S. Can
Corporation or any of its subsidiaries is a party; or
    
    public offerings of shares of capital stock of U.S. Can Corporation.
     
 ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
 Audit Fees
  Audit-Related Fees
  83




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##### 



Tax Fees
  All Other Fees
   
 PART IV
 
 ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 (a)
    
    (1)
    
    
    
    Financial Statements commence on p. 26.(2)
    
    
    
    Financial Statement SchedulesAll schedules are omitted as they are inapplicable or not required, or the
required information is included in the financial statements or in the notes
thereto.(3)
    
    
    
    Exhibits: A list of Exhibits is included in the Exhibit Index,
which appears following the signature pages and is incorporated by reference
herein.(b)
    
    See Item 15 (a) (3) above.(c)
    
    See Item 15 (a) (2) above.
 84




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##### 



SIGNATURES
  U.S. CAN CORPORATIONBy:
    
    /s/ Michael M. RajkovicMichael M. RajkovicExecutive Vice President and Chief Financial Officer(Principal Financial Officer)
  Signature
    
    Title/s/ Carl Ferenbach

Carl Ferenbach
    
    Director and Co-Chairman of the Board/s/ George V. Bayly

George V. Bayly
    
    Director, Co-Chairman of the Board/s/ Philip R. Mengel

Philip R. Mengel
    
    Director and Chief Executive Officer (Principal Executive Officer)/s/ Michael M. Rajkovic

Michael M. Rajkovic
    
    Executive Vice President and Chief Financial Officer (Principal Financial
Officer and Principal Accounting Officer)/s/ Richard K. Lubin

Richard K. Lubin
    
    Director/s/ Francisco A. Soler

Francisco A. Soler
    
    Director/s/ Louis B. Susman

Louis B. Susman
    
    Director
  85




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##### 



EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
  ExhibitNumber
    
    Exhibit Description2.1
    
    Agreement and Plan of Merger (the Merger Agreement) dated as of June 1, 2000 between U.S.
Can Corporation and Pac Packaging Acquisition Corporation (Exhibit 2 to the current report on
Form 8-K, filed on June 15, 2000).(1)2.2
    
    First Amendment to Merger Agreement dated as of June 28, 2000 (Exhibit 2.2 to the current
report on Form 8-K, filed on June 30, 2000).(1)2.3
    
    Second Amendment to Merger Agreement dated as of August 22, 2000 (Exhibit 2.3 to the current
report on Form 8-K, filed on August 31, 2000).(1)3.1
    
    Restated Certificate of Incorporation of U.S. Can Corporation (Exhibit 3.1 to the
registration statement on Form (No. 333-53276), declared effective on March 5, 2001).(1)3.2
    
    Amended and Restated By-laws of U.S. Can Corporation (Exhibit 3.2 to the registration
statement on Form (No. 333-53276), declared effective on March 5, 2001).(1)3.3
    
    Restated Certificate of Incorporation of United States Can Company (Exhibit 3.3 to the
registration statement on Form (No. 333-53276), declared effective on March 5, 2001).(1)3.4
    
    Amended and Restated By-laws of United States Can Company (Exhibit 3.4 to the registration
statement on Form (No. 333-53276), declared effective on March 5, 2001).(1)3.5
    
    Certificate of Incorporation of USC May Verpackungen Holding Inc (Exhibit 3.5 to the
registration statement on Form (No. 333-53276), declared effective on March 5, 2001).(1)3.6
    
    By-Laws of USC May Verpackungen Holding Inc (Exhibit 3.6 to the registration statement on
Form (No. 333-53276), declared effective on March 5, 2001).(1)4.1
    
    Indenture dated as of October 4, 2000 between the Company and Bank One Trust Company, N.A.,
as Trustee (Exhibit 4.1 to the current report on Form 8-K, filed on October 18, 2000).(1)4.2
    
    Indenture dated as of July 22, 2003 among U.S. Can Corporation, United States Can Company,
USC May Verpackungen Holding Inc. and Wells Fargo Bank Minnesota, National Association
(Exhibit 4.3 to current report on Form 8-K, filed on July 22, 2003).(1)10.1
    
    Credit Agreement dated as of October 4, 2000, among United States Can Company, the guarantors
and Bank of America, N.A. and the other financial institutions listed therein, as Lenders
(Exhibit 10.1 to the current report on Form 8-K, filed on
October 18, 2000).(1)10.2
    
    Pledge Agreement dated as of October 4, 2000 among U.S. Can Corporation, United States Can
Company, each of the domestic subsidiaries of United States Can Company and Bank of America,
N.A (Exhibit 10.2 to the registration statement on Form (No. 333-53276), declared effective on
March 5, 2001).(1)10.3
    
    Security Agreement dated as of October 4, 2000 among U.S. Can Corporation, United States Can
Company, each of the domestic subsidiaries of United States Can Company and Bank of America,
N.A (Exhibit 10.3 to the registration statement on Form (No. 333-53276), declared effective on
March 5, 2001).(1)10.4
    
    Sublease Agreement, dated 2/10/89, relating to the Commerce, CA property (Exhibit 10.10 to
the quarterly report on Form 10-Q for the quarter ended April 6, 1997, filed on May 20,
1997).(1)10.5
    
    Lease Agreement, dated 1/1/76, as amended, relating to the Weirton, WV property (Exhibit
10.11 to the quarterly report on Form 10-Q, for the quarter ended April 6, 1997, filed on May
20, 1997).(1)10.6
    
    First Amendment to Credit Agreement dated as of April 1, 2001 (Exhibit 10.27 to the quarterly
report on Form
10-Q for the period ended April 1, 2001, filed on May 15, 2001).(1)10.7
    
    Amendment No. 4 to the Lease Agreement, dated 1/1/76, as amended, relating to the Weirton, WV
property (Exhibit 10.7 to the registration statement on Form (No. 333-53276), declared
effective on March 5, 2001).(1)10.8
    
    Lease relating to Dragon Parc Industrial Estate, Merthyr Tydfil, Wales, dated November 27,
1996 (Exhibit 10.24 to the annual report on Form 10-K for the fiscal year ended December 31,
1996, filed on March 26, 1997).(1)10.9
    
    Nonqualified Supplemental 401(k) Plan (Exhibit 10.33 to the annual report on Form 10-K for
the fiscal year ended December 31, 1995, filed on March 26, 1996).(1)
 86




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##### 



ExhibitNumber
    
    Exhibit Description10.10
    
    Nonqualified Benefit Replacement Plan (Exhibit 10.34 to the annual report on Form 10-K for
the fiscal year ended December 31, 1995, filed on March 26, 1996).(1)10.11
    
    Lease Agreement between May Grundbesitz GmbH & Co. KG and May Verpackungen GmbH & Co. KG
(Exhibit 10.1 to the quarterly report on Form 10-Q for the quarter ended July 2, 2000, filed
on August 15, 2000).(1)10.12
    
    Amendment No. 3 to the Lease Agreement, dated 1/1/76, as amended, relating to the Weirton,
WV property (Exhibit 10.55 to the annual report on Form 10-K for the fiscal year ended
December 31, 1995, filed on March 26, 1996).(1)10.13
    
    Employment Agreement dated October 4, 2000 by and among John L. Workman, United States Can
Company and U.S. Can Corporation (Exhibit 10.14 to the registration statement on Form S-4 (No.
333-53276), filed January 5,2001).(1)*10.14
    
    Lease Agreement dated June 15, 2000, related to Atlanta, GA plastics facility (Exhibit 10.15
to the annual report on Form 10-K for the fiscal year ended December 31, 2001, filed on March
22, 2002). (1)10.15
    
    Employment Agreement dated October 4, 2000 by and among Thomas A. Scrimo, United States Can
Company and U.S. Can Corporation (Exhibit 10.18 to the registration statement on Form S-4 (No.
333-53276), filed January 5,2001).(1)*10.16
    
    U.S. Can Corporation Executive Deferred Compensation Plan (Exhibit 10.30 to the annual
report on Form 10-K for the fiscal year ended December 31, 1998, filed on March 31, 1999).(1)*10.17
    
    Amendment No. 1 to the U.S. Can Corporation Executive Deferred Compensation Plan, dated as
of October 4, 2000 (Exhibit 10.23 to the registration statement on Form S-4 (No. 333-53276),
filed January 5,2001).(1)*10.18
    
    U.S. Can Corporation 2000 Equity Incentive Plan (Exhibit 10.24 to the registration statement
on Form S-4 (No. 333-53276), filed January 5,2001).(1)*10.19
    
    United States Can Company Executive Severance Plan, dated as of October 13, 1999 (Exhibit
10.34 to the annual report on Form 10-K for the fiscal year ended December 31, 1999, filed on
March 30, 2000).(1)*10.20
    
    U.S. Can Corporation Stockholders Agreement, dated as of October 4, 2000 (Exhibit 10.26 to
the registration statement on Form S-4 (No. 333-53276), filed January 5,2001).(1)*10.21
    
    Berkshire Fee Letter dated December 18, 2001 (Exhibit 10.27 to the annual report on Form
10-K for the fiscal year ended December 31, 2001, filed on March 22, 2002). (1)10.22
    
    Second Amendment to Credit Agreement dated December 18, 2001 (Exhibit 10.28 to the
annual report on Form 10-K for the fiscal year ended December 31, 2001, filed on March 22,
2002). (1)10.23
    
    Sale Agreement of the Scotts Road, Southall, United Kingdom factory premises dated
December 18, 2001 (Exhibit 10.29 to the annual report on Form 10-K for the fiscal year ended
December 31, 2001, filed on March 22, 2002). (1)10.24
    
    Compromise Agreement and General Release between the Company and David R. Ford dated June
30, 2002. (Exhibit 10(a) to the quarterly report on Form 10-Q, for the quarter ended
September 29, 2002, filed on November 12, 2002).(1)*10.25
    
    Compromise Agreement and General Release between the Company an J. Michael Kirk dated
October 16, 2002 (Exhibit 10(b) to the quarterly report on Form 10-Q, for the quarter ended
September 29, 2002, filed on November 12, 2002).(1)*10.26
    
    Separation Agreement and General Release between the Company and Paul W. Jones dated
November 26, 2002 (Exhibit 10.26 to the annual report on Form 10-K for the fiscal year ended
December 31, 2003, filed on March 18, 2004).(1)*10.27
    
    Amendment No. 1 to the U.S. Can Corporation Nonqualified Supplemental 401(k), dated as of
February 25, 2002 (Exhibit 10.27 to the annual report on Form 10-K for the fiscal year ended
December 31, 2003, filed on March 18, 2004). (1)10.28
    
    Third Amendment to Credit Agreement dated July 22, 2003 (Exhibit 10.5 to the current report
on Form 8-K, filed on
July 22, 2003). (1)10.29
    
    Security Agreement dated as of July 22, 2003 among United States Can Company, U.S. Can
Corporation, USC May Verpackungen Holding Inc. and Wells Fargo Bank Minnesota, National
Association (Exhibit 10.30 to the registration statement on Form S-4 (No. 333-108940), filed
December 11, 2003). (1)
 87




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##### 



ExhibitNumber
    
    Exhibit Description10.30
    
    Pledge Agreement dated as of July 22, 2003 among United States Can Company, U.S. Can
Corporation, USC May Verpackungen Holding Inc. and Wells Fargo Bank Minnesota, National
Association (Exhibit 10.31 to the registration statement on Form S-4 (No. 333-108940), filed
December 11, 2003). (1)10.31
    
    Lien Intercreditor Agreement dated as of July 22, 2003 among Wells Fargo Bank Minnesota,
National Association, Bank of America, N.A., United States Can Company, U.S. Can Corporation
and USC May Verpackungen Holding, Inc. (Exhibit 10.32 to the registration statement on Form
S-4 (No. 333-108940), filed December 11, 2003). (1)10.32
    
    Separation Agreement and General Release between United States Can Company and James J.
Poehling dated October 24, 2003 (Exhibit 10.33 to the registration statement on Form S-4 (No.
333-108940), filed December 11, 2003).(1)*10.33
    
    Credit Agreement dated as of June 21, 2004, among United States Can Corporation, United
States Can Company, certain financial institutions and Deutsche Bank Trust Company Americas
(Exhibit 10.1 to the current report on Form 8-K, filed on
October 6, 2004).(1)10.34
    
    Amendment No. 1 and Waiver to Credit Agreement dated as of October 1, 2004 by and among U.S.
Can Corporation, United States Can Company, certain financial institutions and Deutsche Bank
Trust Company Americas (Exhibit 10.2 to the current report on Form 8-K, filed on October 6,
2004).(1)10.35
    
    Separation Agreement and General Release between United States Can Company and John L.
Workman dated April 22, 2004 (Exhibit 10.34 to the quarterly report on Form 10-Q, for the
quarter ended July 4, 2004, filed on November 18, 2004).(1)*10.36
    
    Settlement Letter from USC Europe (UK) Limited to Francois Vissers dated October 6, 2004
(Exhibit 10.35 to the quarterly report on Form 10-Q, for the quarter ended October 3, 2004,
filed on November 18, 2004).(1)*10.37
    
    Employment Agreement dated July 1, 2004 by and among Anthony P. MacLaurin, United States Can
Company and U.S. Can Corporation (1).*10.38
    
    Separation Agreement and General Release between United States Can Company and Sandra K.
Vollman dated December 22,
2004 (1).*18
    
    Letter of Deloitte & Touche LLP dated August 4, 2004, regarding the Companys adoption of
FIFO for domestic inventories (Exhibit 18 to the quarterly report on Form 10-Q, for the
quarter ended July 4, 2004, filed on November 18, 2004).(1)21
    
    Subsidiaries of the Registrant (1).22
    
    Power of Attorney (included as part of the Signature Pages).31.1
    
    Certification of Chief Executive Officer Pursuant to Section 13a-15 of the Securities and
Exchange Act of 193431.2
    
    Certification of Chief Financial Officer Pursuant to Section 13a-15 of the Securities and
Exchange Act of 1934
 
 (1)
    
    Incorporated by reference.*
    
    Indicates a management contract or compensatory plan or arrangement. 88