WORTHINGTON ARMSTRONG VENTURE




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WORTHINGTON ARMSTRONG VENTURE
 Table of Contents
 PageIndependent Auditors Report
    
    
    1Consolidated Balance Sheets, December 31, 2009 and 2008
    
    
    2Consolidated Statements of Income, Years ended December 31, 2009, 2008, and 2007
    
    
    3Consolidated Statements of Partners Equity (Deficit) and Comprehensive Income, Years ended
December 31, 2009, 2008, and 2007
    
    
    4Consolidated Statements of Cash Flows, Years ended December 31, 2009, 2008, and 2007
    
    
    5Notes to Consolidated Financial Statements
    
    
    6




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Independent Auditors Report
 
     
  1




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WORTHINGTON ARMSTRONG VENTURE
    2009
    
    
    2008AssetsCurrent assets:Cash and cash equivalents
    
    $
    48,797
    
    
    
    50,284Accounts receivable, net
    
    
    27,819
    
    
    
    33,946Inventory, net
    
    
    31,560
    
    
    
    46,636Other current assets
    
    
    1,843
    
    
    
    1,595Total current assets
    
    
    110,019
    
    
    
    132,461Property, plant, and equipment, net
    
    
    33,657
    
    
    
    30,081Goodwill
    
    
    2,245
    
    
    
    2,230Other assets
    
    
    323
    
    
    
    461Total assets
    
    $
    146,244
    
    
    
    165,233Liabilities and Partners Equity (Deficit)Current liabilities:Accounts payable
    
    $
    11,178
    
    
    
    12,745Accrued expenses
    
    
    5,493
    
    
    
    6,837Taxes payable
    
    
    670
    
    
    
    2,024Total current liabilities
    
    
    17,341
    
    
    
    21,606Long-term liabilities:Deferred income taxes
    
    
    181
    
    
    
    583Long-term debt
    
    
    150,000
    
    
    
    150,000Other long-term liabilities
    
    
    4,454
    
    
    
    6,204Total long-term liabilities
    
    
    154,635
    
    
    
    156,787Total liabilities
    
    
    171,976
    
    
    
    178,393Partners equity (deficit):Contributed capital
    
    
    
    
    
    
    Retained earnings
    
    
    
    
    
    
    Distributions in excess of earnings and contributions
    
    
    (27,339
    )
    
    
    (13,117
    )Accumulated other comprehensive income (loss)
    
    
    1,607
    
    
    
    (43
    )Total partners equity (deficit)
    
    
    (25,732
    )
    
    
    (13,160
    )Total liabilities and partners equity (deficit)
    
    $
    146,244
    
    
    
    165,233
   2




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WORTHINGTON ARMSTRONG VENTURE
    2009
    
    
    2008
    
    
    2007Net sales
    
    $
    307,938
    
    
    
    421,836
    
    
    
    379,988Cost of sales
    
    
    (189,083
    )
    
    
    (261,664
    )
    
    
    (245,061
    )Gross margin
    
    
    118,855
    
    
    
    160,172
    
    
    
    134,927Selling, general, and administrative expenses
    
    
    (23,441
    )
    
    
    (27,349
    )
    
    
    (22,310
    )95,414
    
    
    
    132,823
    
    
    
    112,617Other income
    
    
    254
    
    
    
    108
    
    
    
    114Interest income
    
    
    120
    
    
    
    1,501
    
    
    
    2,162Interest expense
    
    
    (2,005
    )
    
    
    (3,965
    )
    
    
    (4,400
    )Income before income tax expense
    
    
    93,783
    
    
    
    130,467
    
    
    
    110,493Income tax expense
    
    
    (1,005
    )
    
    
    (5,022
    )
    
    
    (3,450
    )Net income
    
    $
    92,778
    
    
    
    125,445
    
    
    
    107,043
   3




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WORTHINGTON ARMSTRONG VENTURE
    Contributed capitalThe
    
    
    
    
    
    
    Distributions
    
    
    AccumulatedArmstrong
    
    
    Worthington
    
    
    
    
    
    
    in excess of
    
    
    other
    
    
    TotalVentures,
    
    
    Steel
    
    
    Retained
    
    
    earnings and
    
    
    comprehensive
    
    
    partners
    
    
    ComprehensiveInc.
    
    
    Company
    
    
    earnings
    
    
    contributions
    
    
    income (loss)
    
    
    equity (deficit)
    
    
    incomeBalance, December 31, 2006
    
    $
    12,925
    
    
    
    9,713
    
    
    
    127,757
    
    
    
    
    
    
    
    2,555
    
    
    
    152,950
    
    
    $
    107,998Net income
    
    
    
    
    
    
    
    
    
    
    107,043
    
    
    
    
    
    
    
    
    
    
    
    107,043
    
    
    $
    107,043Distributions
    
    
    (100
    )
    
    
    (100
    )
    
    
    (234,800
    )
    
    
    
    
    
    
    
    
    
    
    (235,000
    )
    
    
    Change in funded status of
pension plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    252
    
    
    
    252
    
    
    
    252Foreign currency translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    3,625
    
    
    
    3,625
    
    
    
    3,625Balance, December 31, 2007
    
    $
    12,825
    
    
    
    9,613
    
    
    
    
    
    
    
    
    
    
    
    6,432
    
    
    
    28,870
    
    
    $
    110,920Net income
    
    
    
    
    
    
    
    
    
    
    125,445
    
    
    
    
    
    
    
    
    
    
    
    125,445
    
    
    $
    125,445Distributions
    
    
    (12,825
    )
    
    
    (9,613
    )
    
    
    (125,445
    )
    
    
    (13,117
    )
    
    
    
    
    
    
    (161,000
    )
    
    
    Change in funded status of
pension plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (2,217
    )
    
    
    (2,217
    )
    
    
    (2,217
    )Foreign currency translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (4,258
    )
    
    
    (4,258
    )
    
    
    (4,258
    )Balance, December 31, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (13,117
    )
    
    
    (43
    )
    
    
    (13,160
    )
    
    $
    118,970Net income
    
    
    
    
    
    
    
    
    
    
    92,778
    
    
    
    
    
    
    
    
    
    
    
    92,778
    
    
    $
    92,778Distributions
    
    
    
    
    
    
    
    
    
    
    (92,778
    )
    
    
    (14,222
    )
    
    
    
    
    
    
    (107,000
    )
    
    
    Change in funded status of
pension plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    528
    
    
    
    528
    
    
    
    528Foreign currency translation
adjustments
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,122
    
    
    
    1,122
    
    
    
    1,122Balance, December 31, 2009
    
    $
    
    
    
    
    
    
    
    
    
    
    
    
    (27,339
    )
    
    
    1,607
    
    
    
    (25,732
    )
    
    $
    94,428
   4




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WORTHINGTON ARMSTRONG VENTURE
    2009
    
    
    2008
    
    
    2007Cash flows from operating activities:Net income
    
    $
    92,778
    
    
    
    125,445
    
    
    
    107,043Adjustments to reconcile net income to net
cash provided by operating activities:Depreciation and amortization
    
    
    3,711
    
    
    
    3,648
    
    
    
    3,276Deferred income taxes
    
    
    (414
    )
    
    
    69
    
    
    
    53Change in accounts receivable
    
    
    6,209
    
    
    
    11,714
    
    
    
    974Change in inventory
    
    
    15,276
    
    
    
    (11,385
    )
    
    
    3,632Change in accounts payable and
accrued expenses
    
    
    (2,989
    )
    
    
    (7,491
    )
    
    
    (400
    )Other
    
    
    (2,779
    )
    
    
    (1,367
    )
    
    
    (547
    )Net cash provided by operating
activities
    
    
    111,792
    
    
    
    120,633
    
    
    
    114,031Cash flows from investing activities:Purchases of property, plant, and equipment
    
    
    (7,380
    )
    
    
    (6,272
    )
    
    
    (5,051
    )Sale of property, plant, and equipment
    
    
    282
    
    
    
    75
    
    
    
    Net cash used in investing activities
    
    
    (7,098
    )
    
    
    (6,197
    )
    
    
    (5,051
    )Cash flows from financing activities:Issuance of long-term debt
    
    
    
    
    
    
    50,000
    
    
    
    100,000Distributions paid
    
    
    (107,000
    )
    
    
    (161,000
    )
    
    
    (235,000
    )Issuance costs related to debt
    
    
    
    
    
    
    
    
    
    
    (232
    )Net cash used in financing activities
    
    
    (107,000
    )
    
    
    (111,000
    )
    
    
    (135,232
    )Effect of exchange rate changes on cash and
cash equivalents
    
    
    819
    
    
    
    (456
    )
    
    
    1,531Net increase (decrease) in cash and
cash equivalents
    
    
    (1,487
    )
    
    
    2,980
    
    
    
    (24,721
    )Cash and cash equivalents at beginning of year
    
    
    50,284
    
    
    
    47,304
    
    
    
    72,025Cash and cash equivalents at end of year
    
    $
    48,797
    
    
    
    50,284
    
    
    
    47,304Supplemental disclosures:Interest paid
    
    $
    2,391
    
    
    
    4,530
    
    
    
    2,590Income taxes paid
    
    
    3,876
    
    
    
    3,423
    
    
    
    3,937
   5




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WORTHINGTON ARMSTRONG VENTURE
    (1)
    
    Description of Business
 Worthington Armstrong Venture (the Company) is a general partnership, formed in June 1992,
between Armstrong Ventures, Inc. (Armstrong), a subsidiary of Armstrong World Industries,
Inc., and The Worthington Steel Company (Worthington), a Delaware corporation (a subsidiary of
Worthington Industries, Inc.). Its business is to manufacture and market suspension systems
for commercial and residential ceiling markets throughout the world. The Company has
manufacturing plants located in the United States, France, Spain, the United Kingdom, the
Peoples Republic of China, and India.
 (2)
    
    Summary of Significant Accounting Policies
 (a)
    
    Use of Estimates
 These consolidated financial statements are prepared in accordance with accounting
principles generally accepted in the United States of America (U.S. GAAP) and include
management estimates and judgments, where appropriate. Actual results could differ from
those estimates. Significant items subject to such estimates and assumptions include the
carrying amount of property, plant, and equipment and goodwill, valuation allowances for
receivables and inventories, and assets and obligations related to employee benefits.
 The consolidated financial statements include the accounts of the Company and its
subsidiaries. All significant intercompany transactions have been eliminated.
 (b)
    
    Revenue Recognition
 The Company recognizes revenue from the sale of products when title transfers, generally
on the date of shipment and collection of the relevant receivable is probable. At the
time of shipment, a provision is made for estimated applicable discounts and losses that
reduce revenue. Sales with independent U.S. distributors of products to major home center
retailers are recorded when the products are shipped from the distributors locations to
these retailers.
 Sales taxes collected from customers and remitted to governmental authorities are
accounted for on a net basis and, therefore, are excluded from revenues in the
consolidated statements of income.
 (c)
    
    Advertising Costs
 The Company recognizes advertising expense as incurred. Advertising expense was $1,015,
$1,193, and $970 for the years ended December 31, 2009, 2008, and 2007, respectively.
 (d)
    
    Research and Development Expenditures
 The Company recognizes research and development expense as expenditures are incurred.
Total research and development expense was $3,623, $4,762, and $3,734 for the years ended
December 31, 2009, 2008, and 2007, respectively.
 (e)
    
    Taxes
 The Company is a general partnership in the United States, and accordingly, generally,
U.S. federal and state income taxes are the responsibility of the two general partners.
Deferred income tax assets and liabilities are recognized for foreign subsidiaries for
taxes estimated to be payable in future years based upon differences between the
financial reporting and tax bases of assets and liabilities. Deferred tax assets and
liabilities are determined using enacted rates expected to apply to taxable
  6 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    income in the
years the temporary differences are expected to be recovered or settled. In connection
with the adoption of FASB Accounting Standards Update(ASU) No. 2009-06as of January 1,
2009, and following the guidance in FASB Accounting Standards Codification (ASC) Topic
740  Income Taxes, the Company recognizes the effect of income tax positions only if
those positions are more likely than not of being sustained. Recognized income tax
positions are measured at the largest amount that is greater than 50% likely of being
realized. Changes in recognition or measurement are reflected in the period in which the
change in judgment occurs. Prior to the adoption of ASU No. 2009-06, the Company
recognized the effect of income tax positions only if such positions were probable of
being sustained.
 (f)
    
    Cash and Cash Equivalents
 Short-term cash investments that have maturities of three months or less when purchased
are considered to be cash equivalents.
 (g)
    
    Trade Accounts Receivable
 Trade accounts receivable are recorded at the invoiced amount and do not bear interest.
The Company maintains an allowance for doubtful accounts for estimated losses inherent in
its accounts receivable portfolio. In establishing the required allowance, management
considers historical losses, current receivables aging, and existing industry and
national economic data. Account balances are charged off against the allowance after all
means of collection have been exhausted and the potential for recovery is considered
remote. The Company does not have any off-balance-sheet credit exposure related to its
customers.
 (h)
    
    Inventories
 Inventories are valued at the lower of cost or market. Cost is determined on the
first-in, first-out method.
 (i)
    
    Long-Lived Assets
 Property, plant, and equipment are stated at cost, with accumulated depreciation and
amortization deducted to arrive at net book value. Depreciation charges are determined
generally on the
straight-line basis over the useful lives as follows: buildings, 30 years; machinery and
equipment, 5 to 15 years; and leasehold improvements over the shorter of 10 years or the
life of the lease. Impairment losses are recorded when indicators of impairment are
present and the undiscounted cash flows estimated to be generated by those assets are
less than the assets carrying amount. If an impairment exists, the asset is reduced to
fair value.
 (j)
    
    Goodwill
 Goodwill represents the excess of the aggregate purchase price over the fair value of the
net assets acquired in a purchase business combination. Goodwill is tested for impairment
at least annually. The impairment tests performed in 2009, 2008, and 2007 did not result
in an impairment of the Companys goodwill.
 (k)
    
    Foreign Currency Translation and Transactions
 For subsidiaries with functional currencies other than the U.S. dollar, income statement
items are translated into dollars at average exchange rates throughout the year and
balance sheet items are translated at year-end exchange rates. Gains or losses on foreign
currency transactions are
  7 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    recognized in other income, net in the accompanying
consolidated statements of income. Gains and losses on foreign translation are recognized
in accumulated other comprehensive income in the accompanying consolidated balance
sheets.
 (3)
    
    Accounts Receivable
 The Company sells its products to select, preapproved customers whose businesses are directly
affected by changes in economic and market conditions. The Company considers these factors and
the financial condition of each customer when establishing its allowance for losses from
doubtful accounts. The allowance for doubtful accounts was $862 and $223 at December 31, 2009
and 2008, respectively.
 (4)
    
    Inventory
 2009
    
    
    2008Finished goods
    
    $
    13,176
    
    
    
    20,288Goods in process
    
    
    59
    
    
    
    139Raw materials
    
    
    14,935
    
    
    
    22,997Supplies
    
    
    3,390
    
    
    
    3,212Total inventories
    
    $
    31,560
    
    
    
    46,636
 (5)
    
    Property, Plant, and Equipment
 2009
    
    
    2008Land
    
    $
    1,942
    
    
    
    1,911Buildings
    
    
    15,014
    
    
    
    13,536Machinery and equipment
    
    
    73,105
    
    
    
    66,714Computer software
    
    
    1,069
    
    
    
    733Construction in process
    
    
    3,800
    
    
    
    5,70694,930
    
    
    
    88,600Accumulated depreciation and amortization
    
    
    (61,273
    )
    
    
    (58,519
    )Total property, plant, and equipment, net
    
    $
    33,657
    
    
    
    30,081
 Depreciation and amortization expense was $3,711, $3,648, and $3,276 in 2009, 2008, and 2007,
respectively.
 (6)
    
    Goodwill
 Goodwill increased (decreased) by $15, $(48), and $237 during 2009, 2008, and 2007,
respectively, due to foreign currency translation.
  8 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    (7)
    
    Fair Value of Financial Instruments
 The Company does not hold or issue financial instruments for trading purposes.
 The carrying amounts of cash and cash equivalents, accounts receivable, and accounts payable
approximate their fair value due to the short-term maturity of these instruments. The carrying
value of debt approximates fair value as the debt carries a variable interest rate.
 Fair value is defined as the exchange price that would be received for an asset or paid to
transfer a liability (an exit price) in the principal or most advantageous market for the
asset or liability in an orderly transaction between market participants at the measurement
date. U.S. GAAP establishes a three-level fair value hierarchy that prioritizes the inputs
used to measure fair value. The three levels of inputs used to measure fair value are as
follows:
 Level 1  Quoted prices in active markets for identical assets or liabilities
 Level 2  Observable inputs other than quoted prices included in Level 1, such as quoted
prices for similar assets and liabilities in active markets; quoted prices for identical or
similar assets and liabilities in markets that are not active; or other inputs that are
observable or can be corroborated by observable market data
 Level 3  Unobservable inputs that are supported by little or no market activity and that are
significant to the fair value of the assets or liabilities. This includes certain pricing
models, discounted cash flow methodologies, and similar techniques that use significant
unobservable inputs.
 Assets measured at fair value on a recurring basis are summarized below:
 Quoted active markets (Level 1)2009
    
    
    2008Assets:Money market investments (included within
cash and cash equivalents)
    
    $
    22,905
    
    
    
    22,004$
    22,905
    
    
    
    22,004
 The Company adopted the section within ASC Topic 820  Fair Value Measurements and Disclosures
that relates to determining the fair value of non-financial assets and liabilities as of
January 1, 2009. This did not have a material impact on the financial statements.
 The Company does not have any significant financial or nonfinancial assets or liabilities that
are valued using Level 2 or 3 inputs.
 (8)
    
    Debt
 In May 2007, the Company amended the line-of-credit facility to extend the credit agreement to
May 2012 and to increase the line of credit to $150 million. The revolving line of credit is
unsecured. At December 31, 2009 and 2008, there was $150 million outstanding on this line of
credit. The amount outstanding bears interest ranging from 0.79%-1.76% and 1.97%-3.97% at
December 31, 2009 and 2008, respectively.
  9 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    The line of credit contains certain restrictive financial covenants, including, among others,
interest coverage and leverage ratios, as well as restrictions on dividends. The Company was
in compliance with its covenants as of December 31, 2009 and 2008.
 (9)
    
    Pension Benefit Programs
 The Company contributes to the Worthington deferred profit sharing plan for eligible
U.S. employees. Cost for this plan was $824, $1,138, and $901 for 2009, 2008, and 2007,
respectively.
 The Company contributes to government-related pension programs in a number of foreign
countries. The cost for these plans amounted to $329, $296, and $209 for 2009, 2008, and 2007,
respectively.
 The Company also has a U.S. defined benefit pension plan for eligible hourly employees that
worked in its former manufacturing plant located in Malvern, Pennsylvania. This plan was
curtailed in January 2004 due to the consolidation of the Companys East Coast operations,
which eliminated the expected future years of service for participants in the plan.
 The Company has included the required disclosures related to the adoption of ASC Topic 715 -
Compensation  Retirement Benefitsduring 2009.
 The following table sets forth the defined benefit pension plans benefit obligations, fair
value of plan assets, and funded status at December 31, 2009 and 2008:
 2009
    
    
    2008Projected benefit obligation at beginning of year
    
    $
    8,683
    
    
    
    8,703Interest cost
    
    
    507
    
    
    
    511Actuarial (gain) loss
    
    
    (19
    )
    
    
    111Benefits paid
    
    
    (735
    )
    
    
    (642
    )Projected benefit obligation at end of year
    
    $
    8,436
    
    
    
    8,683
 2009
    
    
    2008Benefit obligation at December 31
    
    $
    8,436
    
    
    
    8,683Fair value of plan assets as of December 31
    
    
    5,531
    
    
    
    5,321Funded status at end of year
    
    $
    (2,905
    )
    
    
    (3,362
    )Amounts recognized in the balance sheets consist of:Other long-term liabilities
    
    $
    (2,905
    )
    
    
    (3,362
    )Accumulated other comprehensive loss
    
    
    3,845
    
    
    
    4,373
 Amounts recognized in accumulated other comprehensive loss represent unrecognized net
actuarial losses.
  10 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    The components of net periodic benefit cost (benefit) are as follows:
 2009
    
    
    2008
    
    
    2007Interest cost
    
    $
    507
    
    
    
    511
    
    
    
    498Expected return on plan assets
    
    
    (411
    )
    
    
    (584
    )
    
    
    (596
    )Recognized net actuarial loss
    
    
    247
    
    
    
    209
    
    
    
    203Net periodic benefit cost
    
    $
    343
    
    
    
    136
    
    
    
    105
 The accumulated benefit obligation for the U.S. defined benefit plan was $8,436 and $8,683 at
December 31, 2009 and 2008, respectively.
 The net loss for the defined benefit pension plan that will be amortized from accumulated
other comprehensive income into net periodic benefit cost over the next fiscal year is $130.
 Weighted average assumptions used to determine benefit obligations for the years ended and as
of December 31, 2009 and 2008 are as follows:
 2009
    
    
    2008Weighted average assumptions for the year ended December 31:Discount rate
    
    
    6.10
    %
    
    
    5.85
    %Expected long-term rate of return on plan assets
    
    
    8.00
    
    
    
    8.00Weighted average assumptions as of December 31:Discount rate
    
    
    6.10
    %
    
    
    6.10
    %Expected long-term rate of return on plan assets
    
    
    8.00
    
    
    
    8.00
 Pension plan assets are required to be disclosed at fair value in the consolidated financial
statements. Fair value is defined in note 7  Fair Value of Financial Instruments.
 The U.S. defined benefit pension plan assets fair value measurement level within the fair
value hierarchy is based on the lowest level of any input that is significant to the fair
value measurement. Valuation techniques used need to maximize the use of observable inputs and
minimize the use of unobservable inputs.
  11 (Continued)




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WORTHINGTON ARMSTRONG VENTURE
    The following table sets forth by level within the fair value hierarchy a summary of the
plans assets measured at fair value on a recurring basis as of December 31, 2009:
 2009Fair value based onQuoted active
    
    
    Observablemarkets
    
    
    inputsFair value
    
    
    (Level 1)
    
    
    (Level 2)Investment:Cash and money market funds
    
    $
    340
    
    
    
    340
    
    
    
    Corporate bonds
    
    
    716
    
    
    
    
    
    
    
    716U.S. government and agency issues
    
    
    684
    
    
    
    
    
    
    
    684Common stocks
    
    
    3,791
    
    
    
    3,791
    
    
    
    $
    5,531
    
    
    
    4,131
    
    
    
    1,400
 Following is a description of the valuation methodologies used for assets measured at fair
value. There have been no changes in the methodologies used at December 31, 2009 and 2008.
 Cash: Consists of cash and cash equivalents. The carrying amounts of cash and cash equivalents
approximate fair value due to the short-term maturity of these instruments.
 Money market funds: The money market investment consists of an institutional investor money
market fund, valued at the funds net asset value (NAV), which is normally calculated at the
close of business daily. The funds assets are valued as of this time for the purpose of
computing the funds NAV.
 Corporate bonds and U.S. government and agency issues: Consist of investments in individual
corporate bonds or government bonds. These bonds are each individually valued using a yield
curve model, based on observable inputs, that may also incorporate available trade and bid/ask
spread data where available.
 Common stocks: Consist of investments in common stocks that are valued at the closing price
reported on the active market on which the individual security is traded.
 In developing the 8% expected long-term rate of return assumption, the Company considered its
historical returns and reviewed asset class return expectations and long-term inflation
assumptions.
 The primary investment objective of the defined benefit pension plan is to achieve long-term
growth of capital in excess of 8% annually, exclusive of contributions or withdrawals. This
objective is to be achieved through a balanced portfolio comprising equities, fixed income,
and cash investments.
  12 (Continued)




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##### 



WORTHINGTON ARMSTRONG VENTURE
    Each asset class utilized by the defined benefit pension plan has a targeted percentage. The
following table shows the asset allocation target and the December 31, 2009 and 2008 position:
 Position at December 31Target weight
    
    
    2009
    
    
    2008Equity securities
    
    
    65
    %
    
    
    69
    %
    
    
    64
    %Fixed income securities
    
    
    35
    
    
    
    25
    
    
    
    31Cash and equivalents
    
    
    
    
    
    
    6
    
    
    
    5
 The Company made contributions of $271 and $58 to the U.S. defined benefit pension plan in
2009 and 2008, respectively. There were no contributions made in 2007. The Company expects to
contribute $300 to the plan in 2010.
 The benefits expected to be paid in each of the next five years and in the aggregate for the
five years thereafter are shown in the following table:
 Expected future payments for the year
ending December 31:2010
    
    $
    6382011
    
    
    6302012
    
    
    6252013
    
    
    6262014
    
    
    6112015 - 2019
    
    
    2,950
 The expected benefits are based on the same assumptions used to measure the Companys benefit
obligation at December 31, 2009.
 (10)
    
    Income Taxes
 The Company is a general partnership in the United States, and accordingly, generally,
U.S. federal and state income taxes are the responsibility of the two general partners.
Therefore, no income tax provision has been recorded on U.S. income. There are no significant
differences between the statutory income tax
rates in foreign countries where the Company operates and the income tax provision recorded in
the income statements. No deferred taxes, including withholding taxes, have been provided on
the unremitted earnings of foreign subsidiaries as the Companys intention is to invest these
earnings permanently.
 Deferred tax balances recorded on the balance sheets relate primarily to depreciation,
tax-deductible goodwill, and accrued expenses. In 2009, the provision for income tax expense
(benefit) was $1,005 comprising $1,391 current and $(386) deferred. In 2008, the provision for
income tax expense (benefit) was $5,022 comprising $5,078 current and $(56) deferred. In 2007,
the provision for income tax expense was $3,450 comprising $3,292 current and $158 deferred.
  13 (Continued)




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##### 



WORTHINGTON ARMSTRONG VENTURE
    The Company adopted the provisions of ASC Topic 740, Income Taxes, related to the accounting
for uncertainties in income taxes on January 1, 2009. As a result of this implementation, the
Company did not recognize any additional liabilities for unrecognized tax benefits.
 The Company is open for tax examination by foreign taxing authorities for various
jurisdictions from 2006-2009. We have no reserve related to these tax years.
 (11)
    
    Leases
 The Company rents certain real estate and equipment. Several leases include options for
renewal or purchase and contain clauses for payment of real estate taxes and insurance. In
most cases, management expects that in the normal course of business, leases will be renewed
or replaced by other leases. Minimum rent payments under operating leases are recognized on a
straight-line basis over the term of the lease including any periods of free rent. Rent
expense during 2009, 2008, and 2007 amounted to $2,418, $2,473, and $2,470, respectively.
 Future minimum payments by year and in the aggregate for operating leases having noncancelable
lease terms in excess of one year are as follows:
 Year:2010
    
    $
    2,9272011
    
    
    2,6272012
    
    
    2,5012013
    
    
    2,4872014
    
    
    9682015 thereafter
    
    
    515Total
    
    $
    12,025
 (12)
    
    Accumulated Other Comprehensive Income
 The balances for accumulated other comprehensive income are as follows:
 2009
    
    
    2008Foreign currency translation
    
    $
    5,452
    
    
    
    4,330Pension plan
    
    
    (3,845
    )
    
    
    (4,373
    )Total accumulated other comprehensive
income (loss)
    
    $
    1,607
    
    
    
    (43
    )
  14 (Continued)




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##### 



WORTHINGTON ARMSTRONG VENTURE
    (13)
    
    Related Parties
 Armstrong provides certain selling, promotional, and administrative processing services to the
Company for which it receives reimbursement. Armstrong purchases grid products from the
Company, which are then resold along with Armstrong inventory to the customer.
 2009
    
    
    2008
    
    
    2007Services provided by Armstrong
    
    $
    14,194
    
    
    
    16,143
    
    
    
    14,961Sales to Armstrong
    
    
    66,782
    
    
    
    98,002
    
    
    
    87,660
 No amounts were owed to Armstrong as of December 31, 2009 or 2008. Armstrong owed the Company
$4,101 and $2,797 for purchases of product for the same periods, respectively, which are
included in accounts receivable.
 Worthington provides certain administrative processing services, steel processing
services, and insurance-related coverages to the Company for which it receives reimbursement.
 2009
    
    
    2008
    
    
    2007Administrative services by Worthington
    
    $
    435
    
    
    
    474
    
    
    
    436Insurance-related coverage net premiums
(refunds) by Worthington
    
    
    456
    
    
    
    (276
    )
    
    
    272Steel processing services by Worthington
    
    
    1,536
    
    
    
    2,215
    
    
    
    2,076
 The Company owed $634 and $294 to Worthington as of December 31, 2009 and 2008, respectively,
which are included in accounts payable.
 (14)
    
    Legal Proceedings
 The Company is involved in various claims and legal actions arising in the ordinary course of
business. In the opinion of management, the ultimate disposition of these matters will not
have a material adverse effect on the Companys consolidated financial position, results of
operations, or liquidity.
 (15)
    
    Subsequent Events
 Management has evaluated subsequent events through the date the annual consolidated financial
statements were available to be issued, February 19, 2010.
  15