2.2.0.25falsefalse11601 - Disclosure - Litigation and Uncertaintiestruefalsefalse1falsefalseUSDfalsefalse1/1/2010 - 12/31/2010 USD ($) USD ($) / shares $Duration_1_1_2010_To_12_31_2010http://www.sec.gov/CIK0001130385duration2010-01-01T00:00:002010-12-31T00:00:00Unit12Standardhttp://www.xbrl.org/2003/iso4217USDiso42170Unit15Dividehttp://www.xbrl.org/2003/iso4217USDiso4217http://www.xbrl.org/2003/instancesharesxbrli0Unit1Standardhttp://www.xbrl.org/2003/instancesharesxbrli0Unit13Standardhttp://www.xbrl.org/2003/instancepurexbrli0USDUSD$5false0us-gaap_CommitmentsAndContingenciesDisclosureTextBlockus-gaaptruenadurationNo definition available.falsefalsefalsefalsefalsefalsefalsefalsefalsefalseterselabel1falsefalsefalse00<div> <div style="width: 87%; margin-left: 6%;"> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties</font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Asbestos</font></u></b> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Some of our U.S. and U.K. subsidiaries are defendants in numerous asbestos-related lawsuits and <font style="white-space: nowrap;" class="_mt">out-of-court</font> informal claims pending in the United States and the United Kingdom. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to or use of asbestos in connection with work allegedly performed by our subsidiaries during the 1970s and earlier. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">United States</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">A summary of our U.S. claim activity is as follows: </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="71%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="10" align="center"><b>Number of Claims:</b> </td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="10" align="center"><b>Fiscal Years</b> </td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2009</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2008</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Open claims at beginning of year </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">125,100 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">130,760 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">131,340 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">New claims </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">6,080 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">4,410 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">4,950 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Claims resolved </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(6,760 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(10,070 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(5,530 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Open claims at end of year </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">124,420 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">125,100 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">130,760 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Claims not valued in the liability<sup style="font-size: 85%; vertical-align: top;">(1)</sup> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(97,440 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(94,740 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(84,830 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Open claims valued in the liability at end of year </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">26,980 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">30,360 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">45,930 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="border-bottom: #000000 1pt solid; width: 10%; margin-left: 0%; font-size: 1pt; align: left;"> </div> <div style="margin-top: 3pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" class="MetaData" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="2%"> </td> <td width="1%"> </td> <td width="97%"> </td></tr> <tr><td valign="top">(1) </td> <td> </td> <td class="MetaData" valign="bottom">Claims not valued in the liability include claims on certain inactive court dockets, claims over six years old that are considered abandoned and certain other items.</td></tr></table> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />120 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Of the approximately <font class="_mt">124,420</font> open claims, our subsidiaries are respondents in approximately <font class="_mt">30,300</font> open claims wherein we have administrative agreements and are named defendants in lawsuits involving approximately <font class="_mt">94,120</font> plaintiffs. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">All of the open administrative claims have been filed under blanket administrative agreements that we have with various law firms representing claimants and do not specify monetary damages sought. Based on our analysis of lawsuits, approximately <font class="_mt">56</font>% do not specify the monetary damages sought or merely recite that the amount of monetary damages sought meets or exceeds the required minimum in the jurisdiction in which suit is filed. The following table summarizes the range of requested monetary damages sought by asbestos lawsuits: </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="34%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="7%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="4%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="7%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="11%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="7%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="1%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>No specified<br /></b></td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="14" align="center"><b>Range of Requested Monetary Damages</b> </td> <td>  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center">  </td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>damages*</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>$1 to $50</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>$51 to $1,000</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>$1,001 to $10,000</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>$10,001 +**</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>Total</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos lawsuit monetary damages sought </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">56 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">10 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">27 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">5 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">2 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">100 </td> <td valign="bottom" nowrap="nowrap" align="left">% </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="border-bottom: #000000 1pt solid; width: 10%; margin-left: 0%; font-size: 1pt; align: left;"> </div> <div style="margin-top: 3pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" class="MetaData" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="2%"> </td> <td width="1%"> </td> <td width="97%"> </td></tr> <tr><td valign="top">* </td> <td> </td> <td class="MetaData" valign="bottom"> <div>No specified monetary damages sought or recited amount of monetary damages sought meets or exceeds the required jurisdictional minimum in the jurisdiction in which suit is filed.</div></td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td> </td></tr> <tr><td valign="top" align="right">** </td> <td> </td> <td class="MetaData" valign="bottom"><font class="_mt">Very small number of cases</font>range to $50,000.</td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">The majority of requests for monetary damages are asserted against multiple named defendants in a single complaint. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">We had the following U.S. asbestos-related assets and liabilities recorded on our consolidated balance sheet as of the dates set forth below. Total U.S. asbestos-related liabilities are estimated through fiscal year 2025. Although it is likely that claims will continue to be filed after that date, the uncertainties inherent in any long-term forecast prevent us from making reliable estimates of the indemnity and defense costs that might be incurred after that date. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="75%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="8%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="8%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td> <td>  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2009</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Asbestos-related assets:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Accounts and notes receivable-other </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">54,449 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">65,578 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos-related insurance recovery receivable </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">165,452 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">208,428 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related assets </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">219,901 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">274,006 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Asbestos-related liabilities:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Accrued expenses </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">59,000 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">59,800 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos-related liability </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">278,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">316,700 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related liabilities </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">337,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">376,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Liability balance by claim category:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Open claims </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">78,460 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">141,600 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Future unasserted claims </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">259,040 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">234,900 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related liabilities </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">337,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">376,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Since fiscal year-end 2004, we have worked with Analysis, Research & Planning Corporation, or ARPC, nationally recognized consultants in the United States with respect to projecting asbestos liabilities, to estimate </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />121 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">the amount of asbestos-related indemnity and defense costs at each fiscal year-end for the next 15 years. Since that time, we have recorded our estimated asbestos liability at a level consistent with ARPC's reasonable best estimate. Based on its review of fiscal year 2010 activity, ARPC recommended that the assumptions used to estimate our future asbestos liability be updated as of fiscal year 2010. Accordingly, we developed a revised estimate of our aggregate indemnity and defense costs through fiscal year 2025 considering the advice of ARPC. In fiscal year 2010, we revalued our liability for asbestos indemnity and defense costs through fiscal year 2025 to $<font class="_mt">337,500</font>, which brought our liability to a level consistent with ARPC's reasonable best estimate. In connection with updating our estimated asbestos liability and related asset, we recorded a charge of $<font class="_mt">19,451</font> in fiscal year 2010 primarily related to the revaluation of our asbestos liability, which includes adjustments for actual settlement experience different from our estimates and the accrual of our rolling <font style="white-space: nowrap;" class="_mt">15-year</font> asbestos-related liability estimate. The total asbestos-related liabilities are comprised of our estimates for our liability relating to open (outstanding) claims being valued and our liability for future unasserted claims through fiscal year-end 2025. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Our liability estimate is based upon the following information <font style="white-space: nowrap;" class="_mt">and/or</font> assumptions: number of open claims, forecasted number of future claims, estimated average cost per claim by disease type — mesothelioma, lung cancer and non-malignancies — and the breakdown of known and future claims into disease type — mesothelioma, lung cancer or non-malignancies. The total estimated liability, which has not been discounted for the time value of money, includes both the estimate of forecasted indemnity amounts and forecasted defense costs. Total defense costs and indemnity liability payments are estimated to be incurred through fiscal year 2025, during which period the incidence of new claims is forecasted to decrease each year. We believe that it is likely that there will be new claims filed after fiscal year 2025, but in light of uncertainties inherent in long-term forecasts, we do not believe that we can reasonably estimate the indemnity and defense costs that might be incurred after fiscal year 2025. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Through December 31, 2010, total cumulative indemnity costs paid were approximately $<font class="_mt">729,300</font> and total cumulative defense costs paid were approximately $<font class="_mt">340,700</font>. Historically, defense costs have represented approximately <font class="_mt">31.8</font>% of total defense and indemnity costs. The overall historic average combined indemnity and defense cost per resolved claim through December 31, 2010 has been approximately $<font class="_mt">2.9</font>. The average cost per resolved claim is increasing and we believe it will continue to increase in the future. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Over the last several years, certain of our subsidiaries have entered into settlement agreements calling for insurers to make lump-sum payments, as well as payments over time, for use by our subsidiaries to fund asbestos-related indemnity and defense costs and, in certain cases, for reimbursement for portions of <font style="white-space: nowrap;" class="_mt">out-of-pocket</font> costs previously incurred. During fiscal year 2010, our subsidiaries reached agreements to settle their disputed asbestos-related insurance coverage with four additional insurers. As a result of these settlements, we increased our asbestos-related insurance asset and recorded a gain of $<font class="_mt">14,041</font> in fiscal year 2010. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Asbestos-related assets under executed settlement agreements with insurers due in the next 12 months are recorded within accounts and notes receivable-other and amounts due beyond 12 months are recorded within asbestos-related insurance recovery receivable. Asbestos-related insurance recovery receivable also includes our best estimate of actual and probable insurance recoveries relating to our liability for pending and estimated future asbestos claims through fiscal year 2025. Our asbestos-related assets have not been discounted for the time value of money. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">As of December 31, 2010, there were no unsettled asbestos insurance-related assets recorded. Our insurance recoveries may be limited by insolvencies among our insurers. We have considered the financial viability and legal obligations of our subsidiaries' insurance carriers and believe that the insurers or their </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />122 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">guarantors will continue to reimburse a significant portion of claims and defense costs relating to asbestos litigation. As of December 31, 2010 and 2009, we have not recorded an allowance for uncollectible balances against our asbestos insurance-related assets. We write off receivables from insurers that have become insolvent; there have been no such write-offs during fiscal years 2010, 2009 and 2008. We have not assumed recovery in the estimate of our asbestos insurance asset from any of our currently insolvent insurers. Other insurers may become insolvent in the future and our insurers may fail to reimburse amounts owed to us on a timely basis. Failure to realize the expected insurance recoveries, or delays in receiving material amounts from our insurers, could have a material adverse effect on our financial condition and our cash flows. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">The following table summarizes our net asbestos-related provision: </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="71%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="10" align="center"><b>Fiscal Years</b> </td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2009</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2008</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Provision for revaluation </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">19,451 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">27,615 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">42,727 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Gain on the settlement of coverage litigation </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(14,041 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(1,250 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(36,120 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Net asbestos-related provision </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">5,410 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">26,365 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">6,607 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Our net asbestos-related provision is the result of our revaluation of our asbestos liability and related asset resulting from adjustments for actual settlement experience different from our estimates and the accrual of our rolling <font style="white-space: nowrap;" class="_mt">15-year</font> asbestos liability estimate, partially offset by gains on the settlement of coverage litigation with asbestos insurance carriers. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">The following table summarizes our approximate asbestos-related payments and insurance proceeds: </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="71%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="5%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="10" align="center"><b>Fiscal Years</b> </td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2009</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2008</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos litigation, defense and case resolution payments </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">62,200 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">63,500 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">70,600 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Insurance proceeds </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(71,900 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(39,100 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">(87,400 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Net asbestos-related payments/(receipts) </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">(9,700 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">24,400 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">(16,800 </td> <td valign="bottom" nowrap="nowrap" align="left">) </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">We expect to have net cash outflows of $<font class="_mt">5,700</font> as a result of asbestos liability indemnity and defense payments in excess of insurance settlement proceeds for the full fiscal year 2011. This estimate assumes no additional settlements with insurance companies and no elections by us to fund additional payments. As we continue to collect cash from insurance settlements and assuming no increase in our asbestos-related insurance liability, the asbestos-related insurance receivable recorded on our consolidated balance sheet will continue to decrease. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">The estimate of the liabilities and assets related to asbestos claims and recoveries is subject to a number of uncertainties that may result in significant changes in the current estimates. Among these are uncertainties as to the ultimate number and type of claims filed, the amounts of claim costs, the impact of bankruptcies of other companies with asbestos claims, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, as well as potential legislative changes. Increases in the number of claims filed or costs to resolve those claims could cause us to increase further the estimates of the costs associated with asbestos claims and could have a material adverse effect on our financial condition, results of operations and cash flows. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Based on the fiscal year-end 2010 liability estimate, an increase of <font class="_mt">25</font>% in the average per claim indemnity settlement amount would increase the liability by $<font class="_mt">52,300</font> and the impact on expense would be dependent upon available additional insurance recoveries. Assuming no change to the assumptions currently </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />123 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">used to estimate our insurance asset, this increase would result in a charge in the statement of operations of approximately 80% of the increase in the liability. Long-term cash flows would ultimately change by the same amount. Should there be an increase in the estimated liability in excess of this 25%, the percentage of that increase that would be expected to be funded by additional insurance recoveries will decline. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">United Kingdom</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Some of our subsidiaries in the United Kingdom have also received claims alleging personal injury arising from exposure to asbestos. To date, <font class="_mt">959</font> claims have been brought against our U.K. subsidiaries of which <font class="_mt">287</font> remained open as of December 31, 2010. None of the settled claims has resulted in material costs to us. The following table summarizes our asbestos-related liabilities and assets for our U.K. subsidiaries based on open (outstanding) claims and our estimate for future unasserted claims through fiscal year 2025: </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <table style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%" align="center"> <tr style="font-size: 1pt;" valign="bottom"><td width="75%"> </td> <td width="2%"> </td> <td width="1%" align="right"> </td> <td width="8%" align="right"> </td> <td width="1%" align="left"> </td> <td width="3%"> </td> <td width="1%" align="right"> </td> <td width="8%" align="right"> </td> <td width="1%" align="left"> </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td> <td>  </td> <td>  </td> <td valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>December 31,<br /></b></td> <td>  </td></tr> <tr style="font-size: 8pt;" valign="bottom" align="center"><td valign="bottom" nowrap="nowrap" align="center">  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2010</b> </td> <td>  </td> <td>  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" nowrap="nowrap" align="center"><b>2009</b> </td> <td>  </td></tr> <tr style="line-height: 3pt; font-size: 1pt;"><td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Asbestos-related assets:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Accounts and notes receivable-other </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">1,927 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">3,430 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos-related insurance recovery receivable </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">29,119 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">35,837 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related assets </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">31,046 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">39,267 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Asbestos-related liabilities:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Accrued expenses </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">1,927 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">3,430 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Asbestos-related liability </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">29,119 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">35,837 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related liabilities </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">31,046 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">39,267 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;"><u>Liability balance by claim category:</u> </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr valign="bottom"><td valign="bottom" nowrap="nowrap" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Open claims </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">5,782 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">10,290 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="background: #cceeff;" valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Future unasserted claims </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">25,264 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td valign="bottom" nowrap="nowrap" align="right">28,977 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 1px solid;">  </td> <td style="border-top: #000000 1px solid;">  </td> <td>  </td></tr> <tr valign="bottom"><td valign="bottom" align="left"> <div style="text-indent: -10pt; margin-left: 10pt;">Total asbestos-related liabilities </div></td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">31,046 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td> <td>  </td> <td valign="bottom" nowrap="nowrap" align="left">$ </td> <td valign="bottom" nowrap="nowrap" align="right">39,267 </td> <td valign="bottom" nowrap="nowrap" align="left">  </td></tr> <tr style="font-size: 1pt;" valign="bottom"><td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td> <td>  </td> <td style="border-top: #000000 3px double;">  </td> <td style="border-top: #000000 3px double;">  </td> <td>  </td></tr></table> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">The liability estimates are based on a U.K. House of Lords judgment that pleural plaque claims do not amount to a compensable injury and accordingly, we have reduced our liability assessment. If this ruling is reversed by legislation, the total asbestos liability and related asset recorded in the U.K. would be approximately $<font class="_mt">53,100</font>. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Project Claims</font></u></b> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In the ordinary course of business, we are parties to litigation involving clients and subcontractors arising out of project contracts. Such litigation includes claims and counterclaims by and against us for canceled contracts, for additional costs incurred in excess of current contract provisions, as well as for back charges for alleged breaches of warranty and other contract commitments. If we were found to be liable for any of the claims/counterclaims against us, we would incur a charge against earnings to the extent a reserve had not been established for the matter in our accounts or if the liability exceeds established reserves. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Due to the inherent commercial, legal and technical uncertainties underlying the estimation of all of the project claims described herein, the amounts ultimately realized or paid by us could differ materially from the balances, if any, included in our financial statements, which could result in additional material charges against earnings, and which could also materially adversely impact our financial condition and cash flows. </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />124 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Power Plant Dispute — Ireland</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In 2006, a dispute arose with a client because of material corrosion that occurred at two power plants we designed and built in Ireland, which began operation in December 2005 and June 2006. There was also corrosion that occurred to subcontractor-provided emissions control equipment and induction fans at the back-end of the power plants which is due principally to the low set point temperature design of the emissions control equipment that was set by our subcontractor. We have identified technical solutions to resolve the boiler tube corrosion and emissions control equipment corrosion and during the fiscal fourth quarter of 2008 entered into a settlement with the client under which we are implementing the technical solutions in exchange for a full release of all claims related to the corrosion (including a release from the client's right under the original contract to reject the plants under our availability guaranty) and the client's agreement to share the cost of the ameliorative work related to the boiler tube corrosion. Accordingly, the client withdrew its notice of arbitration in January 2009, which was originally filed in May 2008. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Between fiscal year 2006 and the end of fiscal year 2008, we recorded charges totaling $<font class="_mt">61,700</font> in relation to this project. The implementation of the technical solutions is anticipated to be completed in 2011. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Power Plant Arbitration — North America</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In January 2010, we commenced arbitration against our client in connection with a power plant project in Louisiana seeking, among other relief, a declaration as to our rights under our purchase order with respect to $<font class="_mt">17,800</font> in retention monies and an $<font class="_mt">82,000</font> letter of credit held by the client. The purchase order was for the supply of two boilers and ancillary equipment for the project. The project was substantially completed and released for commercial operation in February 2010. Our client is the project's engineering, procurement and construction contractor. Under the terms of the purchase order, significant reductions to the retention and letter of credit monies are to occur upon the project's achievement of substantial completion, which has been delayed due to failures on our client's part to properly manage and execute the project. The client has taken the position that we are responsible for the project's delays and, subsequent to service of our arbitration demand, has served its own arbitration demand, seeking to assess us with all associated late substantial completion liquidated damages under our purchase order, together with liquidated damages for alleged late material and equipment deliveries, and back charges for corrective work and other damages arising out of allegedly defective materials and equipment delivered by us. The client contends it is owed in excess of $<font class="_mt">69,000</font> under our purchase order as a result of our alleged failures. There is a risk that the client will attempt to call all or part of the letter of credit during the pendency of the proceeding. We are of the opinion that any such call would be wrongful and entitle us to seek return of the funds and any other damages arising out of the call. Our client has commenced a separate arbitration against the power plant owner, seeking monetary damages and delay liquidated damage assessment refunds for schedule and productivity impacts due to force majeure events and other power plant owner-caused delays. The power plant owner has counterclaimed seeking monetary damages for deficient plant performance including the alleged inability of the boilers to sustain reliable operation. Our client has asserted a claim against us in our arbitration with the client for damages in an unspecified amount due to boiler performance problems. It is our position that the existence of the <font style="white-space: nowrap;" class="_mt">owner-to-client</font> claim does not affect our liability under our contract with the client. We cannot predict the ultimate outcome of this dispute at this time. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Camden County <font style="white-space: nowrap;" class="_mt">Waste-to-Energy</font> Project</font></u></b> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">One of our project subsidiaries, Camden County Energy Recovery Associates, LP ("CCERA") owns and operates a <font style="white-space: nowrap;" class="_mt">waste-to-energy</font> facility in Camden County, New Jersey (the "Project"). The Pollution Control Finance Authority of Camden County ("PCFA") issued bonds to finance the construction of the Project and to </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />125 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">acquire a landfill for Camden County's use. Pursuant to a loan agreement between the PCFA and CCERA, proceeds from the bonds were loaned by the PCFA to CCERA and used by CCERA to finance the construction of the Project. Accordingly, the proceeds of this loan were recorded as debt on CCERA's balance sheet and, therefore, were included in our consolidated balance sheet. CCERA's obligation to service the debt incurred pursuant to the loan agreement was limited to depositing all tipping fees and electric revenues received with the trustee of the PCFA bonds. The bond trustee was required to pay CCERA its service fees prior to servicing the PCFA bonds. CCERA had no other debt repayment obligations under the loan agreement with the PCFA and its debt to PCFA was limited to the amount of the outstanding bonds. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In 1997, the United States Supreme Court effectively invalidated New Jersey's long-standing municipal solid waste flow rules and regulations, eliminating the guaranteed supply of municipal solid waste to the Project with its corresponding tipping fee revenue. As a result, tipping fees were reduced to market rate in order to provide a steady supply of fuel to the Project. Those market-rate revenues were not sufficient to service the debt on bonds issued by the PCFA to finance the construction of the Project. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In 1998, CCERA filed suit against the PCFA, the State of New Jersey (the "State"), and other parties seeking, among other things, to void the applicable contracts and agreements governing the Project and a judgment that one or more of the defendants were responsible to pay the bonds. (Camden County Energy Recovery Assoc. v. N.J. Department of Environmental Protection, et al., Superior Court of New Jersey, Mercer County, L-268-98). The bonds outstanding in connection with the Project were issued by the PCFA, not by us or CCERA, and the bonds were not guaranteed by either us or CCERA. In the litigation, the defendants asserted, among other things, that an equitable portion of the bond debt on the Project should be allocated to CCERA even though CCERA did not guarantee the bonds. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">From 1999 through 2009, the State provided subsidies sufficient to ensure the payment of each of the PCFA's bond debt service payments as they became due. In November 2010, the State entered into an agreement with PCFA whereby PCFA was permitted to utilize certain restricted funds towards making the final debt service payment due on the bonds in December 2010 and such final debt service payment on the bonds was made. As a result of the foregoing, we have removed the PCFA debt from our balance sheet, and we believe that the litigation over responsibility for the payment of the bonds has become moot. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"><b><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Environmental Matters</font></u></b> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">CERCLA and Other Remedial Matters</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Under U.S. federal statutes, such as the Resource Conservation and Recovery Act, Comprehensive Environmental Response, Compensation, and Liability Act of 1980 ("CERCLA"), the Clean Water Act and the Clean Air Act, and similar state laws, the current owner or operator of real property and the past owners or operators of real property (if disposal of toxic or hazardous substances took place during such past ownership or operation) may be jointly and severally liable for the costs of removal or remediation of toxic or hazardous substances on or under their property, regardless of whether such materials were released in violation of law or whether the owner or operator knew of, or was responsible for, the presence of such substances. Moreover, under CERCLA and similar state laws, persons who arrange for the disposal or treatment of hazardous or toxic substances may also be jointly and severally liable for the costs of the removal or remediation of such substances at a disposal or treatment site, whether or not such site was owned or operated by such person, which we refer to as an off-site facility. Liability at such off-site facilities is typically allocated among all of the financially viable responsible parties based on such factors as the relative amount of waste contributed to a site, toxicity of such waste, relationship of the waste contributed by a party to the remedy chosen for the site and other factors. </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />126 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">We currently own and operate industrial facilities and we have also transferred our interests in industrial facilities that we formerly owned or operated. It is likely that as a result of our current or former operations, hazardous substances have affected the facilities or the real property on which they are or were situated. We also have received and may continue to receive claims pursuant to indemnity obligations from the present owners of facilities we have transferred, which claims may require us to incur costs for investigation <font style="white-space: nowrap;" class="_mt">and/or</font> remediation. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">We are currently engaged in the investigation <font style="white-space: nowrap;" class="_mt">and/or</font> remediation under the supervision of the applicable regulatory authorities at two of our or our subsidiaries' former facilities (including Mountain Top, which is described below). In addition, we sometimes engage in investigation <font style="white-space: nowrap;" class="_mt">and/or</font> remediation without the supervision of a regulatory authority. Although we do not expect the environmental conditions at our present or former facilities to cause us to incur material costs in excess of those for which reserves have been established, it is possible that various events could cause us to incur costs materially in excess of our present reserves in order to fully resolve any issues surrounding those conditions. Further, no assurance can be provided that we will not discover additional environmental conditions at our currently or formerly owned or operated properties, or that additional claims will not be made with respect to formerly owned properties, requiring us to incur material expenditures to investigate <font style="white-space: nowrap;" class="_mt">and/or</font> remediate such conditions. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">We have been notified that we are a potentially responsible party ("PRP") under CERCLA or similar state laws at three off-site facilities. At each of these sites, our liability should be substantially less than the total site remediation costs because the percentage of waste attributable to us compared to that attributable to all other PRPs is low. We do not believe that our share of cleanup obligations at any of the off-site facilities as to which we have received a notice of potential liability will exceed $<font class="_mt">500</font> in the aggregate. We have also received and responded to a request for information from the United States Environmental Protection Agency ("USEPA") regarding a fourth off-site facility. We do not know what, if any, further actions USEPA may take regarding this fourth off-site facility. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Mountain Top</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In February 1988, one of our subsidiaries, Foster Wheeler Energy Corporation ("FWEC"), entered into a Consent Agreement and Order with the USEPA and the Pennsylvania Department of Environmental Protection ("PADEP") regarding its former manufacturing facility in Mountain Top, Pennsylvania. The order essentially required FWEC to investigate and remediate as necessary contaminants, including trichloroethylene ("TCE"), in the soil and groundwater at the facility. Pursuant to the order, in 1993 FWEC installed a "pump and treat" system to remove TCE from the groundwater. It is not possible at the present time to predict how long FWEC will be required to operate and maintain this system. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">In the fall of 2004, FWEC sampled the private domestic water supply wells of certain residences in Mountain Top and identified approximately <font class="_mt">30</font> residences whose wells contained TCE at levels in excess of Safe Drinking Water Act standards. The subject residences are located approximately one mile to the southwest of where the TCE previously was discovered in the soils at the former FWEC facility. Since that time, FWEC, USEPA, and PADEP have cooperated in responding to the foregoing. Although FWEC believed the evidence available was not sufficient to support a determination that FWEC was responsible for the TCE in the residential wells, FWEC immediately provided the affected residences with bottled water, followed by water filters, and, pursuant to a settlement agreement with USEPA, it hooked them up to the public water system. Pursuant to an amendment of the settlement agreement, FWEC subsequently agreed with USEPA to arrange and pay for the hookup of approximately five additional residences, even though TCE has not been detected in the wells at those residences. FWEC is incurring costs related to public outreach and communications in the affected area, and it may be required to pay the agencies' costs in overseeing and responding to </div> <p style="font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" align="center"><br />127 </p></div> <p> </p> <p> </p> <p> </p> <h5 align="left"><a href="tmp96E1.html#Y88591tocpage">Table of Contents</a></h5> <p> </p> <div style="width: 87%; margin-left: 6%;"> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">FOSTER WHEELER AG AND SUBSIDIARIES<br /></font></b></div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">NOTES TO CONSOLIDATED FINANCIAL STATEMENTS<br /></font></b></div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="center"><b><font style="font-family: 'Times New Roman', Times;" class="_mt">(amounts in thousands of dollars, except share data and per share amounts)</font></b> </div> <div style="margin-top: 18pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left"> </div> <table style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; font-size: 10pt;" border="0" cellspacing="0" cellpadding="0" width="100%"> <tr><td width="3%"> </td> <td width="97%"> </td></tr> <tr valign="top"><td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">16. </font></b> </td> <td><b><font style="font-family: 'Times New Roman', Times;" class="_mt">Litigation and Uncertainties — <i>(Continued)</i></font></b> </td></tr></table> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 0px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">the situation. FWEC is also incurring further costs in connection with a Remedial Investigation / Feasibility Study ("RI/FS") that in March 2009 it agreed to conduct. In April 2009, USEPA proposed for listing on the National Priorities List ("NPL") an area consisting of its former manufacturing facility and the affected residences, but it also stated that the proposed listing may not be finalized if FWEC complies with its agreement to conduct the RI/FS. FWEC submitted comments opposing the proposed listing. FWEC has accrued its best estimate of the cost of the foregoing and it reviews this estimate on a quarterly basis. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Other costs to which FWEC could be exposed could include, among other things, FWEC's counsel and consulting fees, further agency oversight <font style="white-space: nowrap;" class="_mt">and/or</font> response costs, costs <font style="white-space: nowrap;" class="_mt">and/or</font> exposure related to potential litigation, and other costs related to possible further investigation <font style="white-space: nowrap;" class="_mt">and/or</font> remediation. At present, it is not possible to determine whether FWEC will be determined to be liable for some or all of the items described in this paragraph or to reliably estimate the potential liability associated with the items. If one or more third-parties are determined to be a source of the TCE, FWEC will evaluate its options regarding the potential recovery of the costs FWEC has incurred, which options could include seeking to recover those costs from those determined to be a source. </div> <div style="margin-top: 12pt; font-size: 1pt;"> </div> <div style="font-family: Arial, Helvetica; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 2%; font-size: 10pt; margin-right: 0%;" align="left"><i><u><font style="font-family: 'Times New Roman', Times;" class="_mt">Other Environmental Matters</font></u></i> </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">Our operations, especially our manufacturing and power plants, are subject to comprehensive laws adopted for the protection of the environment and to regulate land use. The laws of primary relevance to our operations regulate the discharge of emissions into the water and air, but can also include hazardous materials handling and disposal, waste disposal and other types of environmental regulation. These laws and regulations in many cases require a lengthy and complex process of obtaining licenses, permits and approvals from the applicable regulatory agencies. Noncompliance with these laws can result in the imposition of material civil or criminal fines or penalties. We believe that we are in substantial compliance with existing environmental laws. However, no assurance can be provided that we will not become the subject of enforcement proceedings that could cause us to incur material expenditures. Further, no assurance can be provided that we will not need to incur material expenditures beyond our existing reserves to make capital improvements or operational changes necessary to allow us to comply with future environmental laws. </div> <div style="margin-top: 6pt; font-size: 1pt;"> </div> <div style="text-indent: 20px; font-family: 'Times New Roman', Times; background: none transparent scroll repeat 0% 0%; color: #000000; margin-left: 0%; font-size: 10pt; margin-right: 0%;" align="left">With regard to the foregoing, the <font style="white-space: nowrap;" class="_mt">waste-to-energy</font> facility operated by our CCERA project subsidiary is subject to certain revisions to New Jersey's mercury air emission regulations. The revisions make CCERA's mercury control requirements more stringent, especially when the last phase of the revisions becomes effective in 2012. CCERA's management believes that the data generated during recent stack testing tends to indicate that the facility will be able to comply with even the most stringent of the regulatory revisions without installing additional control equipment. Even if the equipment had to be installed, CCERA could assert that the project's sponsor would be responsible to pay for the equipment. However, the sponsor may not have sufficient funds to do so or may assert that it is not so responsible. Estimates of the cost of installing the additional control equipment are approximately $<font class="_mt">30,000</font> based on our last assessment.</div></div> </div>16.  Litigation and Uncertainties   Asbestos   Some of our U.S. and U.K. subsidiaries are defendants in numerous asbestos-relatedfalsefalsefalsefalsefalseOtherus-types:textBlockItemTypestringIncludes disclosure of commitments and contingencies. 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