20. Subsidiary Guarantees of Debt

The company’s senior notes are guaranteed on a full, unconditional and joint and several basis by certain of the company’s material domestic subsidiaries. Each of the guarantor subsidiaries is 100 percent owned by Ball Corporation. These guarantees are required in support of the notes, are co-terminous with the terms of the respective note indentures and would require performance upon certain events of default referred to in the respective guarantees. The maximum potential amounts that could be required to be paid under the domestic guarantees are essentially equal to the then outstanding principal and interest under the respective notes. The following is unaudited condensed consolidating financial information for the company, segregating the guarantor subsidiaries and non-guarantor subsidiaries, as of September 30, 2016, and December 31, 2015, and for the three and nine months ended September 30, 2016 and 2015. Separate financial statements for the guarantor subsidiaries and the non-guarantor subsidiaries are not presented because management has determined that such financial statements are not required by the current regulations.


	Unaudited Condensed Consolidating Statement of Earnings
	Three Months Ended September 30, 2016
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Net sales	$	—	$	1,214	$	1,689	$	(88)	$	2,815

Cost and expenses
Cost of sales (excluding depreciation and amortization)		—		(992)		(1,434)		88		(2,338)
Depreciation and amortization		(2)		(33)		(112)		—		(147)
Selling, general and administrative		(31)		(43)		(60)		(1)		(135)
Business consolidation and other activities		(154)		(7)		82		—		(79)
Equity in results of subsidiaries		308		8		—		(316)		—
Intercompany		78		(44)		(34)		—		—
		199		(1,111)		(1,558)		(229)		(2,699)

Earnings (loss) before interest and taxes		199		103		131		(317)		116
Interest expense		(66)		—		(14)		—		(80)
Debt refinancing and other costs		—		—		(2)		—		(2)
Total interest expense		(66)		—		(16)		—		(82)
Earnings (loss) before taxes		133		103		115		(317)		34
Tax (provision) benefit		(133)		56		39		—		(38)
Equity in results of affiliates, net of tax		—		1		6		—		7
Net earnings		—		160		160		(317)		3
Less net earnings attributable to
noncontrolling interests		—		—		(3)		—		(3)
Net earnings attributable to
Ball Corporation	$	—	$	160	$	157	$	(317)	$	—

Comprehensive earnings (loss) attributable to Ball Corporation	$	(24)	$	140	$	137	$	(277)	$	(24)


	Unaudited Condensed Consolidating Statement of Earnings
	Three Months Ended September 30, 2015
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Net sales	$	—	$	1,264	$	846	$	(13)	$	2,097

Cost and expenses
Cost of sales (excluding depreciation and amortization)		—		(1,039)		(664)		13		(1,690)
Depreciation and amortization		(1)		(34)		(37)		—		(72)
Selling, general and administrative		(14)		(45)		(48)		—		(107)
Business consolidation and other activities		(129)		(20)		(3)		—		(152)
Equity in results of subsidiaries		129		63		—		(192)		—
Intercompany		51		(44)		(7)		—		—
		36		(1,119)		(759)		(179)		(2,021)

Earnings (loss) before interest and taxes		36		145		87		(192)		76
Interest expense		(37)		1		(2)		—		(38)
Debt refinancing and other costs		(21)		—		—		—		(21)
Total interest expense		(58)		1		(2)		—		(59)
Earnings (loss) before taxes		(22)		146		85		(192)		17
Tax (provision) benefit		67		(20)		(16)		—		31
Equity in results of affiliates, net of tax		—		1		1		—		2
Net earnings		45		127		70		(192)		50
Less net earnings attributable to
noncontrolling interests		—		—		(5)		—		(5)
Net earnings attributable to	$	45	$	127	$	65	$	(192)	$	45
Ball Corporation

Comprehensive earnings (loss) attributable to Ball Corporation	$	28	$	110	$	48	$	(158)	$	28


	Unaudited Condensed Consolidating Statement of Earnings
	Nine Months Ended September 30, 2016
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Net sales	$	—	$	3,495	$	3,276	$	(171)	$	6,600

Cost and expenses
Cost of sales (excluding depreciation and amortization)		—		(2,854)		(2,668)		171		(5,351)
Depreciation and amortization		(4)		(104)		(191)		—		(299)
Selling, general and administrative		(63)		(126)		(159)		—		(348)
Business consolidation and other activities		355		(30)		(644)		—		(319)
Equity in results of subsidiaries		(57)		359		—		(302)		—
Intercompany		189		(131)		(58)		—		—
		420		(2,886)		(3,720)		(131)		(6,317)

Earnings (loss) before interest and taxes		420		609		(444)		(302)		283
Interest expense		(141)		(1)		(17)		—		(159)
Debt refinancing and other costs		(97)		—		(11)		—		(108)
Total interest expense		(238)		(1)		(28)		—		(267)
Earnings (loss) before taxes		182		608		(472)		(302)		16
Tax (provision) benefit		28		6		157		—		191
Equity in results of affiliates, net of tax		—		—		6		—		6
Net earnings		210		614		(309)		(302)		213
Less net earnings attributable to
noncontrolling interests		—		—		(3)		—		(3)
Net earnings attributable to
Ball Corporation	$	210	$	614	$	(312)	$	(302)	$	210

Comprehensive earnings (loss) attributable to Ball Corporation	$	233	$	651	$	(306)	$	(345)	$	233


	Unaudited Condensed Consolidating Statement of Earnings
	Nine Months Ended September 30, 2015
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Net sales	$	—	$	3,729	$	2,498	$	(35)	$	6,192

Cost and expenses
Cost of sales (excluding depreciation and amortization)		—		(3,085)		(1,976)		35		(5,026)
Depreciation and amortization		(4)		(98)		(110)		—		(212)
Selling, general and administrative		(60)		(130)		(150)		—		(340)
Business consolidation and other activities		(105)		(21)		(12)		—		(138)
Equity in results of subsidiaries		341		155		—		(496)		—
Intercompany		153		(130)		(23)		—		—
		325		(3,309)		(2,271)		(461)		(5,716)

Earnings (loss) before interest and taxes		325		420		227		(496)		476
Interest expense		(103)		4		(8)		—		(107)
Debt refinancing and other costs		(84)		—		(2)		—		(86)
Total interest expense		(187)		4		(10)		—		(193)
Earnings (loss) before taxes		138		424		217		(496)		283
Tax (provision) benefit		88		(88)		(48)		—		(48)
Equity in results of affiliates, net of tax		—		1		2		—		3
Net earnings		226		337		171		(496)		238
Less net earnings attributable to
noncontrolling interests		—		—		(12)		—		(12)
Net earnings attributable to
Ball Corporation	$	226	$	337	$	159	$	(496)	$	226

Comprehensive earnings (loss) attributable to Ball Corporation	$	128	$	236	$	55	$	(291)	$	128


	Unaudited Condensed Consolidating Balance Sheet
	September 30, 2016
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Assets
Current assets
Cash and cash equivalents	$	54	$	1	$	590	$	—	$	645
Receivables, net		123		514		1,152		—		1,789
Intercompany receivables		30		121		52		(203)		—
Inventories, net		—		497		921		—		1,418
Other current assets		148		38		66		—		252
Total current assets		355		1,171		2,781		(203)		4,104
Noncurrent assets
Property, plant and equipment, net		19		1,085		3,336		—		4,440
Investment in subsidiaries		7,358		2,449		78		(9,885)		—
Goodwill		—		990		4,221		—		5,211
Intangible assets, net		19		78		1,949		—		2,046
Other assets		213		20		1,026		—		1,259
Total assets	$	7,964	$	5,793		13,391	$	(10,088)	$	17,060

Liabilities and Shareholders' Equity
Current liabilities
Short-term debt and current portion of long-term debt	$	271	$	—		102	$	—	$	373
Accounts payable		15		798		1,051		—		1,864
Intercompany payables		102		52		55		(209)		—
Accrued employee costs		20		111		171		—		302
Other current liabilities		107		54		243		—		404
Total current liabilities		515		1,015		1,622		(209)		2,943
Noncurrent liabilities
Long-term debt		6,530		—		1,194		—		7,724
Employee benefit obligations		344		437		727		—		1,508
Intercompany long-term notes		(3,129)		139		2,984		6		—
Deferred taxes and other liabilities		(9)		217		857		—		1,065
Total liabilities		4,251		1,808		7,384		(203)		13,240

Common stock		1,019		635		4,426		(5,061)		1,019
Preferred stock		—		—		5		(5)		—
Retained earnings		4,708		3,887		1,747		(5,634)		4,708
Accumulated other comprehensive earnings (loss)		(616)		(537)		(278)		815		(616)
Treasury stock, at cost		(1,398)		—		—		—		(1,398)
Total Ball Corporation shareholders' equity		3,713		3,985		5,900		(9,885)		3,713
Noncontrolling interests		—		—		107		—		107
Total shareholders' equity		3,713		3,985		6,007		(9,885)		3,820
Total liabilities and shareholders' equity	$	7,964	$	5,793		13,391	$	(10,088)	$	17,060


	Unaudited Condensed Consolidating Balance Sheet
	December 31, 2015
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Eliminating Adjustments		Consolidated Total

Assets
Current assets
Cash and cash equivalents	$	5	$	—	$	219	$	—	$	224
Receivables, net		40		224		621		—		885
Intercompany receivables		137		517		6		(660)		—
Inventories, net		—		516		382		—		898
Other current assets		49		84		44		—		177
Total current assets		231		1,341		1,272		(660)		2,184
Noncurrent assets
Property, plant and equipment, net		14		1,026		1,646		—		2,686
Investment in subsidiaries		3,688		2,135		79		(5,902)		—
Goodwill		—		967		1,210		—		2,177
Intangible assets, net		19		83		93		—		195
Restricted cash		2,154		—		—		—		2,154
Other assets		152		19		130		—		301
Total assets	$	6,258	$	5,571		4,430	$	(6,562)	$	9,697

Liabilities and Shareholders' Equity
Current liabilities
Short-term debt and current portion of long-term debt	$	1	$	—		76	$	—	$	77
Accounts payable		19		792		690		—		1,501
Intercompany payables		105		1		554		(660)		—
Accrued employee costs		16		133		80		—		229
Other current liabilities		146		60		129		—		335
Total current liabilities		287		986		1,529		(660)		2,142
Noncurrent liabilities
Long-term debt		4,859		—		115		—		4,974
Employee benefit obligations		342		466		339		—		1,147
Intercompany long-term notes		(371)		192		179		—		—
Deferred taxes and other liabilities		(110)		183		100		—		173
Total liabilities		5,007		1,827		2,262		(660)		8,436

Common stock		962		1,042		375		(1,417)		962
Preferred stock		—		—		5		(5)		—
Retained earnings		4,557		3,276		2,062		(5,338)		4,557
Accumulated other comprehensive earnings (loss)		(640)		(574)		(284)		858		(640)
Treasury stock, at cost		(3,628)		—		—		—		(3,628)
Total Ball Corporation shareholders' equity		1,251		3,744		2,158		(5,902)		1,251
Noncontrolling interests		—		—		10		—		10
Total shareholders' equity		1,251		3,744		2,168		(5,902)		1,261
Total liabilities and shareholders' equity	$	6,258	$	5,571		4,430	$	(6,562)	$	9,697


	Unaudited Condensed Consolidating Statement of Cash Flows
	Nine Months Ended September 30, 2016
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidated Total

Cash provided by (used in) operating activities	$	(385)	$	155	$	(203)	$	(433)


Cash flows from investing activities capital expenditures		(10)		(170)		(218)		(398)
Business acquisition, net of cash acquired		2,303		(36)		(5,646)		(3,379)
Proceeds from dispositions, net of cash sold		1,010		—		1,931		2,941
Decrease in restricted cash		1,966		—		—		1,966
Settlement of Rexam acquisition related derivatives		(252)		—		—		(252)
Other, net		—		7		(5)		2
Cash provided by (used in) investing activities		5,017		(199)		(3,938)		880

Cash flows from financing activities
Long-term borrowings		2,610		—		1,760		4,370
Repayments of long-term borrowings		(921)		—		(3,427)		(4,348)
Net change in short-term borrowings		200		—		(44)		156
Proceeds from issuances of common stock		38		—		—		38
Acquisitions of treasury stock		(98)		—		—		(98)
Common dividends		(60)		—		—		(60)
Intercompany		(6,351)		46		6,305		—
Other, net		(5)		(1)		(9)		(15)
Cash provided by (used in) financing activities		(4,587)		45		4,585		43

Effect of exchange rate changes on cash		4		—		(73)		(69)

Change in cash and cash equivalents		49		1		371		421
Cash and cash equivalents – beginning of period		5		—		219		224
Cash and cash equivalents – end of period	$	54	$	1	$	590	$	645


	Unaudited Condensed Consolidating Statement of Cash Flows
	Nine Months Ended September 30, 2015
($ in millions)	Ball Corporation		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidated Total

Cash provided by (used in) operating activities	$	7	$	419	$	171	$	597

Cash flows from investing activities capital expenditures		(5)		(141)		(211)		(357)
Business acquisition, net of cash acquired		—		(29)		—		(29)
Settlement of Rexam acquisition related derivatives		(16)		—		—		(16)
Other, net		21		12		1		34
Cash provided by (used in) investing activities		—		(158)		(210)		(368)

Cash flows from financing activities
Long-term borrowings		2,300		—		15		2,315
Repayments of long-term borrowings		(2,301)		—		(108)		(2,408)
Net change in short-term borrowings		21		(7)		97		111
Proceeds from issuances of common stock		26		—		—		26
Acquisitions of treasury stock		(136)		—		—		(136)
Common dividends		(54)		—		—		(54)
Intercompany		176		(254)		78		—
Other, net		(30)		—		(9)		(39)
Cash provided by (used in) financing activities		2		(261)		73		(185)

Effect of exchange rate changes on cash		(7)		—		17		10

Change in cash and cash equivalents		2		—		51		54
Cash and cash equivalents – beginning of period		2		—		189		191
Cash and cash equivalents – end of period	$	4	$	—	$	240	$	245