Employee Separation / Asset Related Charges, Net

2012 Restructuring Program

In the third quarter 2012, the company commenced a restructuring plan to increase productivity, enhance competitiveness and accelerate growth. The plan is designed to eliminate corporate costs previously allocated to the Performance Coatings business as well as utilize additional cost-cutting actions to improve competitiveness. As a result, a pre-tax charge of about $210 is expected related to this plan, of which $152 was recorded in the third quarter 2012 in employee separation / asset related charges, net. The third quarter 2012 charge consists of $133 of employee separation costs and $19 of asset related charges, which includes $17 of asset impairments and $2 of asset shut downs.

The third quarter 2012 charge impacted segment earnings as follows: Agriculture - $3, Electronics & Communications - $7, Industrial Biosciences - $3, Nutrition & Health - $13, Performance Chemicals - $3, Performance Materials - $9, and Safety & Protection - $55, as well as Corporate expenses - $59.

The company expects to record the remaining charges in connection with this plan during the fourth quarter 2012. The company expects this plan and all related payments to be substantially complete by December 31, 2013.

Account balances and activity for the 2012 restructuring program are summarized below:



	Asset Related			Employee Separation Costs		Total
Charges to income for three and nine months ended September 30, 2012	$	19		$	133	$	152
Charges to accounts:
Payments	—			—		—
Asset write-offs and adjustments	(19		)	—		(19		)
Balance as of September 30, 2012	$	—		$	133	$	133

Asset Impairments

During the third quarter 2012, as a result of conditions in the thin film photovoltaic market, the company determined that an impairment triggering event had occurred and that an assessment of the asset group related to its thin film photovoltaic modules and systems was warranted. This assessment determined that the carrying value of the asset group exceeded its fair value. The basis of the fair value was calculated utilizing a discounted cash flow approach which included assumptions concerning future operating performance and economic conditions that may differ from actual cash flows. As a result of our impairment test, a $150 pre-tax impairment charge was recorded at September 30, 2012. The charge was recorded within the Electronics & Communications segment.

During the third quarter 2012, as a result of deteriorating conditions in an industrial polymer market, the company determined that an impairment triggering event had occurred and that an assessment of the asset group related to this polymer product was warranted. This assessment determined that the carrying value of the asset group exceeded its fair value. The basis of the fair value was calculated utilizing a discounted cash flow approach which included assumptions concerning future operating performance and economic conditions that may differ from actual cash flows. As a result of our impairment test, a $92 pre-tax impairment charge was recorded at September 30, 2012. The charge was recorded within the Performance Materials segment.

In connection with the matters discussed above, at September 30, 2012, the company had long-lived assets with a remaining net book value of approximately $125 accounted for at fair value on a nonrecurring basis after initial recognition. These nonrecurring fair value measurements were determined using level 3 inputs within the fair value hierarchy, as described in the company's 2011 Annual Report in Note 1, "Summary of Significant Accounting Policies".