0000098362 us-gaap:TreasuryStockMember 2010-01-01 2010-12-31 0000098362 us-gaap:TreasuryStockMember 2009-01-01 2009-12-31 0000098362 us-gaap:TreasuryStockMember 2008-01-01 2008-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2010-12-31 0000098362 us-gaap:AdditionalPaidInCapitalMember 2010-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2010-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2010-12-31 0000098362 us-gaap:TreasuryStockMember 2010-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2010-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2009-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2009-12-31 0000098362 us-gaap:AdditionalPaidInCapitalMember 2009-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2009-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2009-12-31 0000098362 us-gaap:TreasuryStockMember 2009-12-31 0000098362 us-gaap:AdditionalPaidInCapitalMember 2008-12-31 0000098362 us-gaap:TreasuryStockMember 2008-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2008-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2008-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2008-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2008-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2007-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2007-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2007-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2007-12-31 0000098362 us-gaap:AdditionalPaidInCapitalMember 2007-12-31 0000098362 us-gaap:TreasuryStockMember 2007-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2010-01-01 2010-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2009-01-01 2009-12-31 0000098362 us-gaap:AccumulatedOtherComprehensiveIncomeMember 2008-01-01 2008-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2010-01-01 2010-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2010-01-01 2010-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2009-01-01 2009-12-31 0000098362 us-gaap:RetainedEarningsUnappropriatedMember 2008-01-01 2008-12-31 0000098362 2008-12-31 0000098362 2007-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2010-01-01 2010-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2009-01-01 2009-12-31 0000098362 us-gaap:OtherAdditionalCapitalMember 2008-01-01 2008-12-31 0000098362 2010-12-31 0000098362 2009-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2009-01-01 2009-12-31 0000098362 us-gaap:NoncontrollingInterestMember 2008-01-01 2008-12-31 0000098362 2009-01-01 2009-12-31 0000098362 2008-01-01 2008-12-31 0000098362 2010-06-30 0000098362 2011-01-31 0000098362 2010-01-01 2010-12-31 iso4217:USD xbrli:shares xbrli:shares iso4217:USD

<div align="left" style="font-family: Helvetica,Arial,sans-serif">   <div align="left" style="font-size: 10pt; margin-top: 0pt"> </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 1 – Significant Accounting Policies</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Principles of Consolidation: </i>The consolidated financial statements include the accounts and operations of The Timken Company and its subsidiaries (the “Company”). All significant intercompany accounts and transactions were eliminated upon consolidation. Investments in affiliated companies were accounted for by the equity method, except when they qualified as variable interest entities, in which case the investments were consolidated in accordance with accounting rules relating to the consolidation of variable interest entities. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Revenue Recognition: </i>The Company recognizes revenue when title passes to the customer. This occurs at the shipping point except for certain exported goods and certain foreign entities, where title passes when the goods reach their destination. Selling prices are fixed based on purchase orders or contractual arrangements. Shipping and handling costs were included in cost of products sold in the Consolidated Statements of Income. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Cash Equivalents: </i>The Company considers all highly liquid investments with a maturity of three months or less when purchased to be cash equivalents. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Allowance for Doubtful Accounts: </i>The Company maintains an allowance for doubtful accounts, which represents an estimate of the losses expected from the accounts receivable portfolio, to reduce accounts receivable to their net realizable value. The allowance was based upon historical trends in collections and write-offs, management’s judgment of the probability of collecting accounts and management’s evaluation of business risk. The Company extends credit to customers satisfying pre-defined credit criteria. The Company believes it has limited concentration of credit risk due to the diversity of its customer base. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Inventories: </i>Inventories are valued at the lower of cost or market, with 54% valued by the last-in, first-out (LIFO) method and the remaining 46% valued by first-in, first-out (FIFO) method. If all inventories had been valued at FIFO, inventories would have been $264.6 million and $237.7 million greater at December 31, 2010 and 2009, respectively. The components of inventories were as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td style="border-bottom: 1px solid #000000"> </td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000">December 31,</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Inventories, net: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Manufacturing supplies </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>57.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">53.0</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Work in process and raw materials </div></td> <td> </td> <td> </td> <td align="right"><b>371.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">269.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Finished products </div></td> <td> </td> <td> </td> <td align="right"><b>398.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">349.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total Inventories, net </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>828.5</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">671.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company recognized an increase in its LIFO reserve of $26.9 million during 2010 compared to a decrease in LIFO reserves of $60.5 million during 2009. The increase in the LIFO reserve recognized during 2010 was due to higher costs and quantities of inventory on hand. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Investments: </i>Short-term investments are investments with maturities between four months and one year and are valued at amortized cost. The Company held short-term investments with a fair value of $15 million and a cost basis of $15 million as of December 31, 2010 and were included in other current assets on the Consolidated Balance Sheet. At December 31, 2009, the Company’s business in India held investments in mutual funds of $6.9 million as of December 31, 2009. These investments were classified as “available-for-sale” securities and were included in other current assets on the Consolidated Balance Sheet. Unrealized gains and losses were included in accumulated other comprehensive loss, net of tax, on the Consolidated Balance Sheet. Realized gains and losses were included in other (expense) income, net in the Consolidated Statements of Income. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Property, Plant and Equipment: </i>Property, plant and equipment — net is valued at cost less accumulated depreciation. Maintenance and repairs are charged to expense as incurred. The provision for depreciation is computed principally by the straight-line method based upon the estimated useful lives of the assets. The useful lives are approximately 30 years for buildings, five to seven years for computer software and three to 20 years for machinery and equipment. Depreciation expense was $179.6 million, $188.7 million and $186.3 million in 2010, 2009 and 2008, respectively. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The components of property, plant and equipment, net were as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td style="border-bottom: 1px solid #000000"> </td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000">December 31,</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Property, Plant and Equipment: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Land and buildings </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>623.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">611.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Machinery and equipment </div></td> <td> </td> <td> </td> <td align="right"><b>2,830.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2,786.4</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Subtotal </div></td> <td> </td> <td> </td> <td align="right"><b>3,454.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3,398.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Less allowances for depreciation </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(2,186.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2,062.9</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Property, Plant and Equipment, net </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,267.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,335.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">At December 31, 2010 and 2009, property, plant and equipment — net included approximately $99.7 million and $104.3 million, respectively, of capitalized software. Depreciation expense for capitalized software was approximately $18.0 million, $17.8 million and $17.7 million in 2010, 2009 and 2008, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The impairment of long-lived assets is evaluated when events or changes in circumstances indicate that the carrying amount of the asset or related group of assets may not be recoverable. If the expected future undiscounted cash flows are less than the carrying amount of the asset, an impairment loss is recognized at that time to reduce the asset to the lower of its fair value or its net book value. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In November 2010, the Company entered into an agreement to sell the real estate related to its former manufacturing facility in Sao Paulo, Brazil. The carrying value of the real estate was $6.0 million at December 31, 2010. The transfer of the property is expected to occur in 2012 after the Company has completed the environmental remediation of the site. Beginning in 2012, the Company expects to receive approximately $37.8 million, including interest, over an 18-month period once title transfers subject to fluctuations in foreign currency exchange rates. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Goodwill: </i>The Company tests goodwill and indefinite-lived intangible assets for impairment at least annually. The Company performs its annual impairment test on the first day of the fourth quarter after the annual forecasting process is completed. Furthermore, goodwill and indefinite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable in accordance with accounting rules related to goodwill and other intangible assets. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Income Taxes: </i>The Company accounts for income taxes in accordance with accounting rules for income taxes. Deferred tax assets and liabilities are recorded for the future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases, as well as net operating loss and tax credit carryforwards. The Company records valuation allowances against deferred tax assets by tax jurisdiction when it is more likely than not that such assets will not be realized. Accruals for uncertain tax positions are provided for in accordance with accounting rules related to uncertainty in income taxes. The Company records interest and penalties related to uncertain tax positions as a component of income tax expense. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Foreign Currency Translation: </i>Assets and liabilities of subsidiaries, other than those located in highly inflationary countries, are translated at the rate of exchange in effect on the balance sheet date; income and expenses are translated at the average rates of exchange prevailing during the year. The related translation adjustments are reflected as a separate component of accumulated other comprehensive loss. Gains and losses resulting from foreign currency transactions and the translation of financial statements of subsidiaries in highly inflationary countries are included in the Consolidated Statements of Income. The Company realized foreign currency exchange gains of $4.3 million and $8.2 million in 2010 and 2009, respectively, and a foreign currency exchange loss of $5.9 million in 2008. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Stock-Based Compensation: </i>The Company accounts for stock-based compensation in accordance with accounting rules for stock compensation, which require that the fair value of share-based awards be estimated on the date of grant using an option pricing model. The fair value of the award is recognized as expense over the requisite service periods in the accompanying Consolidated Statements of Income. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Earnings Per Share: </i>Earnings per share are computed by dividing net income by the weighted average number of common shares outstanding during the year. Diluted earnings per share are computed by dividing net income by the weighted average number of common shares outstanding, adjusted for the dilutive impact of potential common shares for share-based compensation. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Derivative Instruments: </i>The Company accounts for its derivative instruments in accordance with amended accounting rules regarding derivative instruments and hedging activities. The Company recognizes all derivatives on the Consolidated Balance Sheets at fair value. Derivatives that are not designated as hedges must be adjusted to fair value through earnings. If the derivative is designated and qualifies as a hedge, depending on the nature of the hedge, changes in the fair value of the derivatives are either offset against the change in fair value of the hedged assets, liabilities or firm commitments through earnings or recognized in other comprehensive loss until the hedged item is recognized in earnings. The Company’s holdings of forward foreign currency exchange contracts qualify as derivatives pursuant to the criteria established in derivative accounting guidance, of which the Company has designated certain of those derivatives as hedges. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Recently Adopted Accounting Pronouncements:</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In June 2009, the Financial Accounting Standards Board (FASB) issued new accounting guidance that amends the accounting and disclosure requirements for the consolidation of variable interest entities. The implementation of the new accounting guidance related to variable interest entities, effective January 1, 2010, did not have a material impact on the Company’s results of operations and financial condition. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Use of Estimates: </i>The preparation of financial statements in conformity with U.S. generally accepted accounting principles requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. These estimates and assumptions are reviewed and updated regularly to reflect recent experience. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Reclassifications: </i>Certain amounts reported in the 2009 and 2008 Consolidated Financial Statements have been reclassified to conform to the 2010 presentation. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 2 – Acquisitions and Divestitures</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Acquisitions</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On December 31, 2010, the Company purchased substantially all the assets of City Scrap and Salvage Co. in Akron, Ohio (City Scrap) for $6.5 million. City Scrap, which employs 30 people, has a longstanding relationship with the Company, supplying the Company for more than 15 years as a local source of the ferrous scrap needed for its steelmaking operations. The City Scrap acquisition will streamline the supply of scrap to Timken’s steel operations, improving efficiency and increasing supply chain reliability. City Scrap had revenues of approximately $17 million in 2010. The results of the operations of City Scrap will be included in the Company’s Consolidated Statements of Income effective January 1, 2011. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On September 21, 2010, the Company completed the acquisition of QM Bearings and Power Transmission, Incorporated (QM Bearings), based in Ferndale, Washington, for $16.9 million, including cash acquired of $0.8 million. QM Bearings also has manufacturing facilities in Prince George, British Columbia, Canada and Wuxi, China. QM Bearings manufactures spherical roller-bearing steel-housed units and elastomeric and steel couplings used in demanding processes such as sawmill, logging and cement operations. QM Bearings had sales of approximately $14 million in the last twelve months prior to the acquisition. QM Bearings has approximately 100 employees in the United States, Canada and China. The results of the operations of QM Bearings were included in the Company’s Consolidated Statements of Income for the periods subsequent to the effective date of the acquisition. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In November 2008, the Company purchased the assets of EXTEX, Ltd. (EXTEX), a leading designer and marketer of high-quality replacement engine parts for the aerospace aftermarket, for $28.8 million, including acquisition costs. The acquisition added most of EXTEX’s nearly 600 Federal Aviation Administration (FAA) parts manufacturer approval (PMA) components to the Company’s existing portfolio of more than 1,400 PMAs. This expanded PMA base further positioned the Company to offer comprehensive fleet-support programs, including asset management that maximizes uptime for aircraft operators. EXTEX had 2007 sales of approximately $15.4 million. The results of the operations of EXTEX are included in the Company’s Consolidated Statements of Income for the periods subsequent to the effective date of the acquisition. The purchase price allocation of EXTEX included in-process PMAs. Generally accepted accounting principles do not allow the capitalization of research and development of this nature; therefore, a charge of $0.9 million was included in cost of products sold in the Consolidated Statement of Income in 2008. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In February 2008, the Company purchased the assets of Boring Specialties, Inc. (BSI), a leading provider of a wide range of precision deep-hole oil and gas drilling and extraction products and services, for $56.9 million, including acquisition costs. The acquisition extended the Company’s presence in the energy market by adding BSI’s value-added products to the Company’s current range of alloy steel products for oil and gas customers. The results of the operations of BSI were included in the Company’s Consolidated Statements of Income for the periods subsequent to the effective date of the acquisition. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Pro forma results of these operations have not been presented because the effects of the acquisitions were not significant in 2010, 2009 and 2008. The initial purchase price allocation, net of cash acquired, and any subsequent purchase price adjustments for acquisitions in 2010, 2009 and 2008 are presented below. </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Assets Acquired: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Accounts receivable </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">11.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Inventories </div></td> <td> </td> <td> </td> <td align="right"><b>6.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">13.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Other current assets </div></td> <td> </td> <td> </td> <td align="right"><b>8.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">0.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Property, plant and equipment — net </div></td> <td> </td> <td> </td> <td align="right"><b>3.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">12.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Goodwill </div></td> <td> </td> <td> </td> <td align="right"><b>4.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.4</td> <td> </td> <td> </td> <td> </td> <td align="right">24.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Other intangible assets </div></td> <td> </td> <td> </td> <td align="right"><b>6.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">28.5</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>31.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">90.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Liabilities Assumed: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Accounts payable and other liabilities </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>8.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">4.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Salaries, wages and benefits </div></td> <td> </td> <td> </td> <td align="right"><b>0.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right"><b>9.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">4.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net Assets Acquired </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>22.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">86.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Divestiture</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On December 31, 2009, the Company completed the sale of the assets of its Needle Roller Bearings (NRB) operations to JTEKT Corporation (JTEKT). The Company received approximately $303.6 million in cash proceeds for these operations and retained certain receivables of approximately $26 million. The NRB operations primarily serve the automotive original-equipment market sectors and manufacture highly engineered needle roller bearings, including an extensive range of radial and thrust needle roller bearings as well as bearing assemblies and loose needles for automotive and industrial applications. The NRB operations have facilities in the United States, Canada, Europe and China. The NRB operations had 2009 sales of approximately $407 million and were previously included in the Company’s Mobile Industries, Process Industries and Aerospace and Defense reportable segments. The Mobile Industries segment accounted for approximately 80% of the 2009 sales of the NRB operations. The results of operations were reclassified as discontinued operations during the third quarter of 2009, as the NRB operations met all the criteria for discontinued operations, including assets held for sale. Previous results for 2009 and 2008 have been reclassified to conform to the presentation under discontinued operations. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During the third quarter of 2009, the net assets associated with the then pending sale of the NRB operations were reclassified to assets held for sale and adjusted for impairment and written down to their fair value of $301 million. The Company based its fair value on the expected proceeds from the sale to JTEKT. At September 30, 2009, the carrying value of the net assets of the NRB operations exceeded the expected proceeds to be realized upon completion of the sale by $33.7 million. The Company subsequently recognized an after-tax loss of $12.7 million on the sale of the NRB operations during the fourth quarter of 2009. The after-tax loss on the sale exceeded the initial estimate primarily due to revisions to estimated working capital adjustments. In 2010, the Company recognized an after-tax gain of $7.4 million primarily due to final working capital adjustments. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following results of operations for this business have been treated as discontinued operations for all periods presented. </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" valign="top" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Net sales </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"><b>$</b></td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top">$</td> <td align="right" valign="top">406.7</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top">$</td> <td align="right" valign="top">622.8</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Cost of goods sold </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">376.3</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">533.2</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" valign="top" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Gross profit </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">30.4</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">89.6</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Selling, administrative and general expenses </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">59.3</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">67.8</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Impairment and restructuring charges </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">52.6</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">31.6</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Interest expense, net </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">0.2</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">0.4</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Other expense, net </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">1.7</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">0.2</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" valign="top" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Earnings (loss) before income taxes on operations </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">(83.4</td> <td nowrap="nowrap" valign="top">)</td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">(10.4</td> <td nowrap="nowrap" valign="top">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Income tax benefit (expense) on operations </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>—</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">23.5</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">(0.9</td> <td nowrap="nowrap" valign="top">)</td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Gain (loss) on divestiture </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>11.6</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">(19.9</td> <td nowrap="nowrap" valign="top">)</td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">—</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Income tax (expense) benefit on disposal </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top"><b>(4.2</b></td> <td nowrap="nowrap" valign="top"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">7.2</td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top"> </td> <td align="right" valign="top">—</td> <td nowrap="nowrap" valign="top"> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" valign="top" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">Income (loss) from discontinued operations </div></td> <td> </td> <td nowrap="nowrap" align="right" valign="top"><b>$</b></td> <td align="right" valign="top"><b>7.4</b></td> <td nowrap="nowrap" valign="top"> </td> <td> </td> <td nowrap="nowrap" align="right" valign="top">$</td> <td align="right" valign="top">(72.6</td> <td nowrap="nowrap" valign="top">)</td> <td> </td> <td nowrap="nowrap" align="right" valign="top">$</td> <td align="right" valign="top">(11.3</td> <td nowrap="nowrap" valign="top">)</td> </tr> <tr style="font-size: 1px"> <td colspan="13" valign="top" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2009, approximately $11.6 million of accumulated foreign currency translation adjustments were recognized as part of the loss on divestiture of the NRB operations. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 3 – Earnings Per Share</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table sets forth the reconciliation of the numerator and the denominator of basic earnings per share and diluted earnings per share for the years ended December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Numerator: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Income (loss) from continuing operations attributable to The Timken Company </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>267.4</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(61.4</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">279.0</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Less: undistributed earnings allocated to nonvested stock </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(1.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.9</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Income (loss) from continuing operations available to common shareholders for basic earnings per share and diluted earnings per share </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>266.2</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(61.4</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">277.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Denominator: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Weighted average number of shares outstanding — basic </div></td> <td> </td> <td> </td> <td align="right"><b>96,535,273</b></td> <td> </td> <td> </td> <td> </td> <td align="right">96,135,783</td> <td> </td> <td> </td> <td> </td> <td align="right">95,650,104</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Effect of dilutive options </div></td> <td> </td> <td> </td> <td align="right"><b>980,929</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">297,539</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Weighted average number of shares outstanding, assuming dilution of stock options and awards </div></td> <td> </td> <td> </td> <td align="right"><b>97,516,202</b></td> <td> </td> <td> </td> <td> </td> <td align="right">96,135,783</td> <td> </td> <td> </td> <td> </td> <td align="right">95,947,643</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Basic earnings (loss) per share from continuing operations </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.76</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(0.64</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">2.90</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Diluted earnings (loss) per share from continuing operations </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.73</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(0.64</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">2.89</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The exercise prices for certain stock options that the Company has awarded exceed the average market price of the Company’s common stock. Such stock options are antidilutive and were not included in the computation of diluted earnings per share. The antidilutive stock options outstanding were 980,477, 4,128,421 and 1,453,512 during 2010, 2009 and 2008, respectively. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 4 – Accumulated Other Comprehensive Loss</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Accumulated other comprehensive loss consisted of the following for the years ended December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency translation adjustments </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>87.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">92.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Pension and postretirement benefits adjustments, net of tax </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(710.1</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(808.7</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Unrealized gain on marketable securities, net of tax </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Adjustments to fair value of open foreign currency cash flow hedges, net of tax </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(1.6</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.8</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Accumulated other comprehensive loss </div></td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(624.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(717.1</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 5 – Financing Arrangements</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Short-term debt at December 31, 2010 and 2009 was as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Variable-rate lines of credit for certain of the Company’s foreign subsidiaries with various banks with interest rates ranging from 2.4% to 5.10% and 1.98% to 5.05% at December 31, 2010 and 2009, respectively </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>22.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">26.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Short-term debt </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>22.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">26.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The lines of credit for certain of the Company’s foreign subsidiaries provide for borrowings up to $294.7 million. Most of these lines of credit are uncommitted. At December 31, 2010, the Company had borrowings outstanding of $22.4 million, which reduced the availability under these facilities to $272.3 million. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The weighted average interest rate on short-term debt during the year was 4.3% in 2010, 3.7% in 2009 and 4.1% in 2008. The weighted average interest rate on short-term debt outstanding at December 31, 2010 and 2009 was 3.6% and 4.0%, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company has a $150 million Accounts Receivable Securitization Financing Agreement (Asset Securitization Agreement), which matures in two years. On November 10, 2010, the Company renewed its Asset Securitization Agreement for $150 million. Prior to the renewal, the Company’s Asset Securitization Agreement was $100 million. Under the terms of the Asset Securitization Agreement, the Company sells, on an ongoing basis, certain domestic trade receivables to Timken Receivables Corporation, a wholly-owned consolidated subsidiary that in turn uses the trade receivables to secure borrowings which are funded through a vehicle that issues commercial paper in the short-term market. Borrowings under the agreement are limited to certain borrowing base calculations. Any amounts outstanding under this Asset Securitization Agreement would be reported on the Company’s Consolidated Balance Sheets in short-term debt. As of December 31, 2010 and 2009, there were no outstanding borrowings under the Asset Securitization Agreement. The cost of this credit facility, which is the commercial paper rate plus program fees, is considered a financing cost and is included in interest expense in the Consolidated Statements of Income. This rate was 1.34%, 1.53% and 2.59%, at December 31, 2010, 2009 and 2008, respectively. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Long-term debt at December 31, 2010 and 2009 was as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Fixed-rate Medium-Term Notes, Series A, due at various dates through May 2028, with interest rates ranging from 6.74% to 7.76% </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>175.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">175.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Fixed-rate Senior Unsecured Notes, due September 15, 2014, with an interest rate of 6.0% </div></td> <td> </td> <td> </td> <td align="right"><b>249.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">249.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Variable-rate State of Ohio Water Development Revenue Refunding Bonds, maturing on November 1, 2025 (0.32% at December 31, 2010) </div></td> <td> </td> <td> </td> <td align="right"><b>12.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">12.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Variable-rate State of Ohio Air Quality Development Revenue Refunding Bonds, maturing on November 1, 2025 (1.00% at December 31, 2010) </div></td> <td> </td> <td> </td> <td align="right"><b>9.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">9.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Variable-rate State of Ohio Pollution Control Revenue Refunding Bonds, maturing on June 1, 2033 (1.00% at December 31, 2010) </div></td> <td> </td> <td> </td> <td align="right"><b>17.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">17.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Variable-rate credit facility with US Bank for Advanced Green Components, LLC, maturing on July 17, 2011 (with interest rates ranging from 1.41% to 3.56% at December 31, 2010) </div></td> <td> </td> <td> </td> <td align="right"><b>8.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">11.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other </div></td> <td> </td> <td> </td> <td align="right"><b>19.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">11.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right"><b>491.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">486.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Less current maturities </div></td> <td> </td> <td> </td> <td align="right"><b>9.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">17.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Long-term debt </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>481.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">469.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The maturities of long-term debt for the five years subsequent to December 31, 2010 are as follows: 2011 — $9.6 million; 2012 — $0.1 million; 2013 — $0.9 million; 2014 — $267.0 million; and 2015 - zero. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Interest paid was approximately $36 million in 2010, $39 million in 2009 and $46 million in 2008. This differs from interest expense due to the timing of payments and interest capitalized of approximately $0.7 million in 2010, $1.8 million in 2009 and $3.0 million in 2008. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On September 9, 2009, the Company completed a public offering of $250 million of fixed-rate 6.0% unsecured Senior Notes, due in 2014. The net proceeds from the sale were used for the repayment of the Company’s fixed-rate 5.75% unsecured Senior Notes that were due to mature in February 2010. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On July 10, 2009, the Company entered into a new $500 million Amended and Restated Credit Agreement (Senior Credit Facility). At December 31, 2010, the Company had no outstanding borrowings under its Senior Credit Facility but had letters of credit outstanding totaling $17.2 million, which reduced the availability under the Senior Credit Facility to $482.8 million. The Senior Credit Facility matures on July 10, 2012. Under the Senior Credit Facility, the Company has three financial covenants: a consolidated leverage ratio, a consolidated interest coverage ratio and a consolidated minimum tangible net worth test. At December 31, 2010, the Company was in full compliance with the covenants under the Senior Credit Facility. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Advanced Green Components, LLC (AGC) is a joint venture of the Company. The Company is the guarantor of $3.5 million of AGC’s $8.3 million credit facility with US Bank as of December 31, 2010. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Certain of the Company’s foreign subsidiaries have facilities that also provide for long-term borrowings up to $27.4 million. At December 31, 2010, the Company had borrowings outstanding of $18.2 million, which reduced the availability under these long-term facilities to $9.2 million. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company and its subsidiaries lease a variety of real property and equipment. Rent expense under operating leases amounted to $38.1 million, $43.5 million and $45.7 million in 2010, 2009 and 2008, respectively. At December 31, 2010, future minimum lease payments for noncancelable operating leases totaled $118.2 million and are payable as follows: 2011–$29.0 million; 2012–$23.1 million; 2013–$19.1 million; 2014–$16.0 million; 2015–$13.7 million; and $17.3 million thereafter. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 6 – Impairment and Restructuring Charges</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Impairment and restructuring charges were comprised of the following for the years ended December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Impairment charges </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">107.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">20.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Severance expense and related benefit costs </div></td> <td> </td> <td> </td> <td align="right"><b>6.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">52.8</td> <td> </td> <td> </td> <td> </td> <td align="right">8.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exit costs </div></td> <td> </td> <td> </td> <td align="right"><b>10.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3.7</td> <td> </td> <td> </td> <td> </td> <td align="right">4.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>21.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">164.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">32.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following discussion explains the major impairment and restructuring charges recorded for the periods presented; however, it is not intended to reflect a comprehensive discussion of all amounts in the table above. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Selling and Administrative Cost Reductions</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In March 2009, the Company announced the realignment of its organization to improve efficiency and reduce costs as a result of the economic downturn. During 2009, the Company recorded $10.7 million of severance and related benefit costs related to this initiative to eliminate approximately 280 positions. Of the $10.7 million charge for 2009, $4.5 million related to the Mobile Industries segment, $2.0 million related to the Process Industries segment, $1.6 million related to the Steel segment, $0.6 million related to the Aerospace and Defense segment and $2.0 million related to Corporate positions. Overall, the Company eliminated approximately 500 sales and administrative positions in 2009. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Manufacturing Workforce Reductions</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2010, the Company recorded $5.0 million in severance and related benefit costs to eliminate approximately 200 positions to properly align its business as a result of the downturn in the economy and expected market demand. Of the $5.0 million charge for 2010, $2.0 million related to the Aerospace and Defense segment, $1.6 million related to the Process Industries segment and $1.4 million related to the Mobile Industries segment. In addition, the Company recorded $1.8 million of exit costs in 2010 related to these reductions and costs associated with the consolidation of warehouses. During 2009, the Company recorded $32.2 million in severance and related benefit costs, including a curtailment of pension benefits of $0.9 million, to eliminate approximately 3,000 manufacturing positions to properly align its business as a result of the current downturn in the economy and expected market demand. Of the $32.2 million charge, $21.5 million related to the Mobile Industries segment, $6.5 million related to the Process Industries segment, $2.5 million related to the Aerospace and Defense segment and $1.7 million related to the Steel segment. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>2008 Workforce Reductions</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In December 2008, the Company recorded $4.2 million in severance and related benefit costs to eliminate approximately 110 manufacturing and sales and administrative employees as a result of the downturn in the economy that the Company began to experience. Of the $4.2 million charge, $2.0 million related to the Mobile Industries segment, $0.8 million related to the Process Industries segment, $1.1 million related to the Steel segment and $0.3 million related to Corporate positions. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Bearings and Power Transmission Reorganization</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During the first quarter of 2008, the Company began to operate under two major business groups: the Steel Group and the Bearings and Power Transmission Group. The Bearings and Power Transmission Group is composed of three reportable segments: Mobile Industries, Process Industries and Aerospace and Defense. These organizational changes enabled the Company to streamline operations and eliminate redundancies. As a result of these actions, the Company recorded $2.5 million during the year ended December 31, 2008 of severance and related benefit costs related to this initiative. The severance charge of $2.5 million was attributable to 76 employees and primarily related to the Mobile Industries segment. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Torrington Campus</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On July 20, 2009, the Company completed the sale of the remaining portion of its Torrington, Connecticut office complex. In anticipation of recording a loss upon completion of the sale of the office complex, the Company recorded an impairment charge of $6.4 million during the second quarter of 2009. During the third quarter of 2009, the Company recorded an additional loss of approximately $0.7 million in other (expense) income, net upon completion of the sale of this portion of the office complex. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Mobile Industries</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In March 2007, the Company announced the closure of its manufacturing facility in Sao Paulo, Brazil. The Company completed the closure of this manufacturing facility on March 31, 2010. Pretax costs associated with the closure are expected to be approximately $40 million, which includes restructuring costs and rationalization costs recorded in cost of products sold and selling, general and administrative expenses. The expected costs increased from $30 million to $40 million due to higher site remediation costs. Mobile Industries has incurred cumulative pretax costs of approximately $34.0 million as of December 31, 2010 related to this closure. In 2010, 2009 and 2008, the Company recorded $1.3 million, $5.2 million and $2.2 million, respectively, of severance and related benefit costs and $4.4 million, $1.7 million and $0.8 million, respectively, of exit costs associated with the closure of this facility. In 2010, the Company also recorded impairment charges of $1.1 million associated with this closure. In 2010 and 2008, $4.4 million and $0.8 million, respectively, of the exit costs recorded related to environmental exit costs. The impairment charges were recorded as a result of the carrying value of certain machinery and equipment exceeding their expected future cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2009, the Company recorded impairment charges of $71.7 million for certain fixed assets in the United States, Canada, France and China related to several automotive product lines. The Company reviewed these assets for impairment during the fourth quarter due to declining sales and as a result of the Company’s initiative to exit programs where adequate returns could not be obtained through pricing initiatives. Incorporating this information into its annual long-term forecasting process, the Company determined the undiscounted projected future cash flows for these product lines could not support the carrying value of these asset groups. The Company then arrived at fair value by either valuing the assets in use where the assets were still producing product or in exchange where the assets had been idled. See Note 15 — Fair Value for further discussion of how the Company arrived at fair value. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company recorded an impairment charge of $48.8 million in 2008, representing the write-off of goodwill associated with the Mobile Industries segment. Of the $48.8 million impairment charge, $30.4 million was reclassified to discontinued operations. The Company is required to review goodwill and indefinite-lived intangibles for impairment annually. The Company performed this annual test during the fourth quarter of 2008 using an income approach (discounted cash flow model) and a market approach. As a result of the economic downturn that began in the second half of 2008, management’s forecasts of earnings and cash flow had declined significantly. The Company utilized these forecasts for the income approach as part of the goodwill impairment review. As a result of the lower earnings and cash flow forecasts, the Company determined that the Mobile Industries segment could not support the carrying value of its goodwill. Refer to Note 8 — Goodwill and Other Intangible Assets for additional discussion. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In addition to the above charges, the Company recorded $3.1 million of environmental exit costs in 2010 at the site of its former plant in Columbus, Ohio. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Process Industries</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In May 2004, the Company announced plans to rationalize its three bearing plants in Canton, Ohio within the Process Industries segment. In 2009, the Company closed two of the three bearing plants. The Company expects to incur pretax costs of $70 million to $80 million (including pretax cash costs of approximately $40 million) associated with these rationalization plans. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2010, the Company recorded $1.0 million of exit costs primarily for demolition costs as a result of Process Industries’ rationalization plans. In 2009, the Company recorded impairment charges of $27.7 million, exit costs of $1.6 million and severance and related benefits of $0.6 million related to these rationalization plans. The significant impairment charge was recorded during the second quarter of 2009 as a result of the rapid deterioration of the market sectors served by one of the rationalized plants resulting in the carrying value of the fixed assets for this plant exceeding their projected undiscounted future cash flows. The fair value was determined based on market comparisons to similar assets. In 2008, the Company recorded exit costs of $1.8 million related to these rationalization plans. The Process Industries segment has incurred cumulative pretax costs of approximately $71.2 million as of December 31, 2010 for these plans, including rationalization costs recorded in cost of products sold and selling, general and administrative expenses. See Note 15 — Fair Value for further discussion of how the Company arrived at fair value. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In October 2009, the Company announced the consolidation of its distribution centers in Bucyrus, Ohio and Spartanburg, South Carolina into a leased facility near the existing Spartanburg location. The consolidation of the Company’s distribution centers reflects that nearly 90% of all manufactured product inbound to the Company’s distribution centers originates in the southeastern United States, and the new location will significantly reduce the average number of miles required to ship goods and inventory throughout the supply chain. The closure of the Bucyrus Distribution Center will eliminate approximately 260 positions. Pretax costs associated with this initiative are expected to be approximately $5 million to $10 million by the end of 2011. During 2009, the Company recorded $4.5 million of severance and related benefit costs related to this closure. During 2010, the Company reduced its accruals for severance and related benefits by $0.7 million. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Aerospace and Defense</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2010, the Company recorded fixed asset impairment charges of $2.0 million at its location in Mesa, Arizona. The impairment charges were recorded as a result of the carrying value of certain machinery and equipment exceeding their expected future cash flows. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Impairment and restructuring charges by segment were as follows: </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Year ended December 31, 2010: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="28%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Mobile</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Process</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Aerospace</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Industries</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Industries</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>& Defense</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Steel</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Corporate</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Total</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Impairment charges </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.1</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.7</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Severance expense and related benefit costs </div></td> <td> </td> <td> </td> <td align="right"><b>2.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(0.1</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>6.4</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exit costs </div></td> <td> </td> <td> </td> <td align="right"><b>8.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>10.6</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>13.4</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>3.2</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.6</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(0.1</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>21.7</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Year ended December 31, 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="28%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Mobile</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Process</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Aerospace</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Industries</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Industries</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">& Defense</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Steel</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Corporate</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Total</td> </tr>   <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Impairment charges </div></td> <td> </td> <td align="right">$</td> <td align="right">75.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">30.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.0</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">107.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Severance expense and related benefit costs </div></td> <td> </td> <td> </td> <td align="right">31.1</td> <td> </td> <td> </td> <td> </td> <td align="right">13.3</td> <td> </td> <td> </td> <td> </td> <td align="right">3.0</td> <td> </td> <td> </td> <td> </td> <td align="right">3.3</td> <td> </td> <td> </td> <td> </td> <td align="right">2.1</td> <td> </td> <td> </td> <td> </td> <td align="right">52.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exit costs </div></td> <td> </td> <td> </td> <td align="right">2.1</td> <td> </td> <td> </td> <td> </td> <td align="right">1.6</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">3.7</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right">$</td> <td align="right">108.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">45.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5.0</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">164.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Year ended December 31, 2008: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="28%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Mobile</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Process</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Aerospace</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Industries</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Industries</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">& Defense</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Steel</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Corporate</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Total</td> </tr>   <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Impairment charges </div></td> <td> </td> <td align="right">$</td> <td align="right">18.8</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">20.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Severance expense and related benefit costs </div></td> <td> </td> <td> </td> <td align="right">6.7</td> <td> </td> <td> </td> <td> </td> <td align="right">0.6</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">1.1</td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right">8.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exit costs </div></td> <td> </td> <td> </td> <td align="right">1.7</td> <td> </td> <td> </td> <td> </td> <td align="right">1.9</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">0.4</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">4.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right">$</td> <td align="right">27.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3.8</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">32.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The rollforward of the restructuring accrual was as follows for the years ended December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Beginning balance, January 1 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>34.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">17.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Expense </div></td> <td> </td> <td> </td> <td align="right"><b>17.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">55.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Payments </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(28.9</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(38.6</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Ending balance, December 31 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>22.1</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">34.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The restructuring accrual at December 31, 2010 and 2009 was included in other liabilities on the Consolidated Balance Sheets. The accrual at December 31, 2010 included $8.4 million of severance and related benefits, which is expected to be paid by the end of 2011. The remainder of the balance primarily represented environmental exit costs. The restructuring accrual at December 31, 2009 excluded costs related to the curtailment of pension benefit plans of $0.9 million. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 7 – Contingencies</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company and certain of its U.S. subsidiaries have been designated as potentially responsible parties by the U.S. Environmental Protection Agency for site investigation and remediation under the Comprehensive Environmental Response, Compensation and Liability Act (Superfund) with respect to certain sites. The claims for remediation have been asserted against numerous other entities, which are believed to be financially solvent and are expected to fulfill their proportionate share of the obligation. As of December 31, 2010, the Company had an accrual of $14.2 million for environmental matters, which are probable and reasonably estimable. This accrual is recorded based upon the best estimate of costs to be incurred in light of the progress made in determining the magnitude of remediation costs, the timing and extent of remedial actions required by governmental authorities and the amount of the Company’s liability in proportion to other responsible parties. Approximately $12.2 million of the $14.2 million is included in the rollforward of the restructuring accrual as of December 31, 2010 discussed in Note 6 – Impairment and Restructuring Charges. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In addition, the Company is subject to various lawsuits, claims and proceedings, which arise in the ordinary course of its business. The Company accrues costs associated with legal and non-income tax matters when they become probable and reasonably estimable. Accruals are established based on the estimated undiscounted cash flows to settle the obligations and are not reduced by any potential recoveries from insurance or other indemnification claims. Management believes that any ultimate liability with respect to these actions, in excess of amounts provided, will not materially affect the Company’s Consolidated Financial Statements. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is also the guarantor of debt for AGC, an equity investment of the Company. The Company guarantees $3.5 million of AGC’s outstanding long-term debt of $8.3 million with US Bank. In case of default by AGC, the Company has agreed to pay the outstanding balance, pursuant to the guarantee, due as of the date of default. The debt matures on July 17, 2011. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Product Warranties</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company provides limited warranties on certain of its products. The Company accrues liabilities for warranty policies based upon specific claims and a review of historical warranty claim experience in accordance with accounting rules relating to contingent liabilities. The Company records and accounts for its warranty reserve based on specific claim incidents. Should the Company become aware of a specific potential warranty claim for which liability is probable and reasonably estimable, a specific charge is recorded and accounted for accordingly. Adjustments are made quarterly to the accruals as claim data and historical experience change. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following is a rollforward of the warranty reserves for 2010 and 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Beginning balance, January 1 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>5.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">13.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Expense </div></td> <td> </td> <td> </td> <td align="right"><b>6.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">4.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Payments </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(3.4</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(12.8</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Ending balance, December 31 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>8.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5.4</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The product warranty accrual for 2010 and 2009 was included in other liabilities on the Consolidated Balance Sheets. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 8 – Goodwill and Other Intangible Assets</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company tests goodwill and indefinite-lived intangible assets for impairment at least annually. The Company performs its annual impairment test on the first day of the fourth quarter after the annual forecasting process is completed. Furthermore, goodwill and indefinite-lived intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. Each interim period, management of the Company assesses whether or not an indicator of impairment is present that would necessitate that a goodwill impairment analysis be performed in an interim period other than during the fourth quarter. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company reviews goodwill for impairment at the reporting unit level. The Company’s reporting units are the same as its reportable segments: Mobile Industries, Process Industries, Aerospace and Defense and Steel. The Company prepares its goodwill impairment analysis by comparing the estimated fair value of each reporting unit, using an income approach (a discounted cash flow model) as well as a market approach, with its carrying value. The income approach and the market approach are equally weighted in arriving at fair value, which the Company has applied consistently. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2010 and 2009, no goodwill impairment loss was recorded. In 2008, as a result of the lower earnings and cash flow forecasts, the Company determined that the Mobile Industries segment could not support the carrying value of its goodwill. As a result, the Company recorded a pretax impairment loss of $48.8 million. Of the $48.8 million, $30.4 million was classified as discontinued operations. The remaining $18.4 million was reported in impairment and restructuring charges in the Consolidated Statement of Income at December 31, 2008. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Changes in the carrying value of goodwill were as follows: </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Year ended December 31, 2010: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Beginning</b></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Ending</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Balance</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Acquisitions</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Impairment</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Other</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Balance</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="21" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Segment: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Process Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>49.5</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1.8</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(1.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>50.0</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>162.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(0.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right"><b>162.3</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>9.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>12.1</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="21" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>221.7</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.3</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(1.6</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>224.4</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="21" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The change related to acquisitions reflects the purchase price allocation for the QM Bearings acquisition completed on September 21, 2010 and the preliminary purchase price allocation for the City Scrap acquisition completed on December 31, 2010. The Company expects to complete the preliminary purchase price allocation for City Scrap during the first half of 2011. “Other” for 2010 primarily included foreign currency translation adjustments. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Year ended December 31, 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Beginning</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Ending</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Balance</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Acquisitions</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Impairment</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Other</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Balance</td> </tr>   <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Segment: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Process Industries </div></td> <td> </td> <td align="right">$</td> <td align="right">49.8</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(0.3</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">49.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right">162.0</td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right">162.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right">9.6</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">9.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total </div></td> <td> </td> <td align="right">$</td> <td align="right">221.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">221.7</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">“Other” for 2009 primarily included foreign currency translation adjustments. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table displays intangible assets as of December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="48%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="2%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="2%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000">2009</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Gross</b></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Net</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Gross</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Net</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Carrying</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Accumulated</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Carrying</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Carrying</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Accumulated</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Carrying</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Amount</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Amortization</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Amount</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Amount</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Amortization</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Amount</td> </tr>   <tr style="font-size: 1px"> <td colspan="33" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Intangible assets subject to amortization: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Customer relationships </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>82.0</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>18.6</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>63.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">79.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">14.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">64.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Engineering drawings </div></td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.0</td> <td> </td> <td> </td> <td> </td> <td align="right">2.0</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Know-how </div></td> <td> </td> <td> </td> <td align="right"><b>2.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.1</td> <td> </td> <td> </td> <td> </td> <td align="right">0.9</td> <td> </td> <td> </td> <td> </td> <td align="right">1.2</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Industrial license agreements </div></td> <td> </td> <td> </td> <td align="right"><b>0.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Land-use rights </div></td> <td> </td> <td> </td> <td align="right"><b>8.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>3.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>4.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">7.9</td> <td> </td> <td> </td> <td> </td> <td align="right">3.0</td> <td> </td> <td> </td> <td> </td> <td align="right">4.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Patents </div></td> <td> </td> <td> </td> <td align="right"><b>4.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>3.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">4.4</td> <td> </td> <td> </td> <td> </td> <td align="right">2.9</td> <td> </td> <td> </td> <td> </td> <td align="right">1.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Technology use </div></td> <td> </td> <td> </td> <td align="right"><b>39.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>6.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>32.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">35.6</td> <td> </td> <td> </td> <td> </td> <td align="right">4.2</td> <td> </td> <td> </td> <td> </td> <td align="right">31.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Trademarks </div></td> <td> </td> <td> </td> <td align="right"><b>6.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>5.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">6.0</td> <td> </td> <td> </td> <td> </td> <td align="right">4.7</td> <td> </td> <td> </td> <td> </td> <td align="right">1.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">PMA licenses </div></td> <td> </td> <td> </td> <td align="right"><b>8.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>6.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">8.8</td> <td> </td> <td> </td> <td> </td> <td align="right">2.2</td> <td> </td> <td> </td> <td> </td> <td align="right">6.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Non-compete agreements </div></td> <td> </td> <td> </td> <td align="right"><b>2.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.7</td> <td> </td> <td> </td> <td> </td> <td align="right">1.2</td> <td> </td> <td> </td> <td> </td> <td align="right">1.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Unpatented technology </div></td> <td> </td> <td> </td> <td align="right"><b>7.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>6.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">7.6</td> <td> </td> <td> </td> <td> </td> <td align="right">5.3</td> <td> </td> <td> </td> <td> </td> <td align="right">2.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>163.0</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>50.2</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>112.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">156.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">40.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">115.5</td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Intangible assets not subject to amortization: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Goodwill </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>224.4</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>224.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">221.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">221.7</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Tradename </div></td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">1.4</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">1.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Industrial license agreements </div></td> <td> </td> <td> </td> <td align="right"><b>0.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">FAA air agency certificates </div></td> <td> </td> <td> </td> <td align="right"><b>14.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>14.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">14.2</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">14.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>240.8</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>240.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">238.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">238.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total intangible assets </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>403.8</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>50.2</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>353.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">394.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">40.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">353.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Intangible assets subject to amortization are amortized on a straight-line method over their legal or estimated useful lives, with useful lives ranging from two years to 20 years. Intangibles assets subject to amortization acquired in 2010 were assigned useful lives of 10 to 17 years and had a weighted average amortization period of 15.8 years. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Amortization expense for intangible assets was $9.4 million, $12.8 million and $14.5 million for the years ended December 31, 2010, 2009 and 2008, respectively. Amortization expense for intangible assets is estimated to be approximately $9.5 million in 2011; $9.1 million in 2012; $7.6 million in 2013; $7.4 million in 2014 and $7.4 million in 2015. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 9 – Stock Compensation Plans</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Under the Company’s long-term incentive plan, shares of common stock have been made available to grant, at the discretion of the Compensation Committee of the Board of Directors, to officers and key employees in the form of stock option awards. Stock option awards typically have a ten-year term and generally vest in 25% increments annually beginning on the first anniversary of the date of grant. In addition to stock option awards, the Company has granted restricted shares under the long-term incentive plan. Restricted shares typically vest in 25% increments annually beginning on the first year anniversary of the date of grant and are expensed over the vesting period. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2010, 2009 and 2008, the Company recognized stock-based compensation expense of $8.9 million ($5.6 million after-tax or $0.06 diluted share), $7.0 million ($4.5 million after-tax or $0.05 diluted share) and $6.0 million ($3.8 million after-tax or $0.04 diluted share), respectively, for stock option awards. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The fair value of significant stock option awards granted during 2010, 2009 and 2008 was estimated at the date of grant using a Black-Scholes option-pricing method with the following assumptions: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Weighted average fair value per option </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>9.04</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">4.44</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">9.89</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Risk-free interest rate </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>2.65</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.04</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">3.68</td> <td nowrap="nowrap">%</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Dividend yield </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>1.81</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.65</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">2.08</td> <td nowrap="nowrap">%</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected stock volatility </div></td> <td> </td> <td> </td> <td align="right"><b>0.470</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.430</td> <td> </td> <td> </td> <td> </td> <td align="right">0.351</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Expected life — years </div></td> <td> </td> <td> </td> <td align="right"><b>6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">6</td> <td> </td> <td> </td> <td> </td> <td align="right">6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Historical information was the primary basis for the selection of the expected dividend yield, expected volatility and the expected lives of the options. The dividend yield was calculated based upon the last dividend prior to the grant compared to the trailing 12 months’ daily stock prices. The risk-free interest rate was based upon yields of U.S. zero coupon issues with a term equal to the expected life of the option being valued. Forfeitures were estimated at 4%. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">A summary of option activity for the year ended December 31, 2010 is presented below: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Weighted</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Average</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Weighted</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Remaining</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Aggregate</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Number of</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Average</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Contractual</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Intrinsic Value</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Shares</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Exercise Price</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Term</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">(millions)</td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding — beginning of year </div></td> <td> </td> <td> </td> <td align="right">5,348,272</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">24.37</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">1,183,940</td> <td> </td> <td> </td> <td> </td> <td align="right">22.67</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Exercised </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2,114,048</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">24.64</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Canceled or expired </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(217,268</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">22.34</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="7" align="left" style="border-top: 1px solid #000000"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding — end of year </div></td> <td> </td> <td> </td> <td align="right">4,200,896</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">23.86</td> <td> </td> <td> </td> <td colspan="3" align="center">7 years</td> <td> </td> <td align="right">$</td> <td align="right">100.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Options exercisable </div></td> <td> </td> <td> </td> <td align="right">1,786,693</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">26.72</td> <td> </td> <td> </td> <td colspan="3" align="center">5 years</td> <td> </td> <td align="right">$</td> <td align="right">37.5</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The total intrinsic value of options exercised during the years ended December 31, 2010, 2009 and 2008 was $25.7 million, $0.3 million and $10.6 million, respectively. Net cash proceeds from the exercise of stock options were $44.6 million, $0.8 million and $12.4 million, respectively. Income tax benefits were $5.7 million, $0.1 million and $3.4 million for the years ended December 31, 2010, 2009 and 2008, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">A summary of restricted share activity for the year ended December 31, 2010 is as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="2%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Weighted</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Number of</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Average Grant </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Shares</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Date Fair Value</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding — beginning of year </div></td> <td> </td> <td> </td> <td align="right">768,524</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">23.80</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Granted </div></td> <td> </td> <td> </td> <td align="right">400,980</td> <td> </td> <td> </td> <td> </td> <td align="right">23.59</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Vested </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(372,942</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">27.26</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Canceled or expired </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(114,996</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">17.18</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Outstanding — end of year </div></td> <td> </td> <td> </td> <td align="right">681,566</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">22.90</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company offers a performance unit component under its long-term incentive plan to certain employees in which awards are earned based on Company performance measured by two metrics over a three-year performance period. The Compensation Committee of the Board of Directors can elect to make payments that become due in the form of cash or shares of the Company’s common stock. A total of 69,440, 47,083 and 51,225 performance units were granted in 2010, 2009 and 2008, respectively. Performance units granted, if fully earned, would represent 690,238 shares of the Company’s common stock at December 31, 2010. Since the inception of the plan, 103,686 performance units were canceled. Each performance unit has a cash value of $100. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2010, a total of 681,566 deferred shares, deferred dividend credits and restricted shares have been awarded and are not vested. The Company distributed 372,942, 388,076 and 371,925 shares in 2010, 2009 and 2008, respectively, due to the vesting of these awards. The shares awarded in 2010, 2009 and 2008 totaled 400,980, 372,398 and 306,434, respectively. The Company recognized compensation expense of $8.0 million, $7.9 million and $10.8 million, for the years ended December 31, 2010, 2009 and 2008, respectively, relating to restricted shares and deferred shares. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2010, the Company had unrecognized compensation expense of $23.0 million related to stock option awards, restricted shares and deferred shares. The unrecognized compensation expense is expected to be recognized over a total weighted average period of two years. The number of shares available for future grants for all plans at December 31, 2010 was 3,421,787. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 10 – Research and Development</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company performs research and development under Company-funded programs and under contracts with the federal government and others. Expenditures committed to research and development amounted to $49.9 million, $50 million and $64.1 million in 2010, 2009 and 2008, respectively. Of these amounts, $1.6 million, $1.7 million and $5.1 million respectively, were funded by others. Expenditures may fluctuate from year to year depending on special projects and needs. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 11 – Equity Investments</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Investments accounted for under the equity method were approximately $9.4 million and $9.5 million at December 31, 2010 and 2009, respectively. Approximately $6.8 million of the $9.4 million at December 31, 2010 was classified as assets held for sale and was reported in other current assets. The remaining balance was reported in other non-current assets on the Consolidated Balance Sheets. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Equity investments are reviewed for impairment when circumstances (such as lower-than-expected financial performance or change in strategic direction) indicate that the carrying value of the investment may not be recoverable. If impairment does exist, the equity investment is written down to its fair value with a corresponding charge to the Consolidated Statements of Income. During 2010 and 2008, no impairment charges were recorded related to the Company’s equity investments. During 2009, the Company recorded impairment charges on its investments in International Components Supply LTDA and Endorsia.com International AB of $4.7 million and $1.4 million, respectively. See Note 15 – Fair Value for further discussion of how the Company arrived at fair value. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Advanced Green Components</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2002, the Company’s Automotive Group formed a joint venture, AGC, with Sanyo Special Steel Co., Ltd. (Sanyo) and Showa Seiko Co., Ltd. (Showa). AGC is engaged in the business of converting steel to machined rings for tapered bearings and other related products. During the third quarter of 2006, AGC refinanced its long-term debt and the Company guaranteed half of the balance at that time. The Company currently guarantees $3.5 million of this obligation. The Company concluded that AGC was a variable interest entity and that the Company was the primary beneficiary. Therefore, the Company consolidated AGC, effective September 30, 2006. At December 31, 2010, the net assets (liabilities) of AGC were $(1.3) million, primarily consisting of the following: inventory of $3.1 million; property, plant and equipment of $12.7 million; short-term and long-term debt of $9.4 million; and other non-current liabilities of $7.4 million. All of AGC’s assets are collateral for its obligations. Except for AGC’s indebtedness for which the Company is a guarantor, AGC’s creditors have no recourse to the general credit of the Company. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company has no other variable interest entities, other than AGC, for which it is a primary beneficiary. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 12 – Retirement and Postretirement Benefit Plans</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company sponsors defined contribution retirement and savings plans covering substantially all employees in the United States and employees at certain non-U.S. locations. The Company has contributed Timken common stock to certain of these plans based on formulas established in the respective plan agreements. At December 31, 2010, the plans held 7,521,634 shares of the Company’s common stock with a fair value of $359.0 million. Company contributions to the plans, including performance sharing, were $21.1 million in 2010, $19.3 million in 2009 and $28.5 million in 2008. The Company paid dividends totaling $4.6 million in 2010, $5.1 million in 2009 and $7.1 million in 2008 to plans holding shares of the Company’s common stock. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company and its subsidiaries sponsor a number of defined benefit pension plans, which cover eligible employees, including certain employees in foreign countries. These plans are generally noncontributory. Pension benefits earned are generally based on years of service and compensation during active employment. The cash contributions for the Company’s defined benefit pension plans were $230.0 million and $62.6 million in 2010 and 2009, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company and its subsidiaries also sponsor several funded and unfunded postretirement plans that provide health care and life insurance benefits for eligible retirees and dependents. Depending on retirement date and employee classification, certain health care plans contain contribution and cost-sharing features such as deductibles and coinsurance. The remaining health care and life insurance plans are noncontributory. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company recognizes the overfunded status or underfunded status (i.e., the difference between the Company’s fair value of plan assets and the projected benefit obligations) as either an asset or a liability for its defined benefit pension and postretirement benefit plans on the Consolidated Balance Sheet, with a corresponding adjustment to accumulated other comprehensive income, net of tax. The adjustment to accumulated other comprehensive income represents the current year net unrecognized actuarial gains and losses and unrecognized prior service costs. These amounts will be recognized in future periods as net periodic benefit cost. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following tables summarize the net periodic benefit cost information and the related assumptions used to measure the net period benefit cost for the years ended December 31: </div> <div align="center"> <table style="font-size: 9pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="50%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%">    </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="5%">     </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="5%">    </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>Defined Benefit Pension Plans</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>Postretirement Benefit Plans</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Components of net periodic benefit cost</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Service cost </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>32.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">39.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">36.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.1</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Interest cost </div></td> <td> </td> <td> </td> <td align="right"><b>157.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">158.9</td> <td> </td> <td> </td> <td> </td> <td align="right">161.4</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>35.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">39.5</td> <td> </td> <td> </td> <td> </td> <td align="right">41.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected return on plan assets </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(199.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(192.9</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(200.9</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Amortization of prior service cost (credit) </div></td> <td> </td> <td> </td> <td align="right"><b>9.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">11.3</td> <td> </td> <td> </td> <td> </td> <td align="right">12.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(1.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.2</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.1</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Amortization of net actuarial loss </div></td> <td> </td> <td> </td> <td align="right"><b>51.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">35.8</td> <td> </td> <td> </td> <td> </td> <td align="right">29.6</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>4.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3.7</td> <td> </td> <td> </td> <td> </td> <td align="right">5.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Pension curtailments and settlements </div></td> <td> </td> <td> </td> <td align="right"><b>0.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3.0</td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Amortization of transition asset </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.1</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.1</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net periodic benefit cost </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>52.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">55.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">39.6</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>40.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">43.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">47.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assumptions</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>U.S. Plans:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Discount rate </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>6.0</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">6.3</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">6.3</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>5.75</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">6.3</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">6.3</td> <td nowrap="nowrap">%</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Future compensation assumption </div></td> <td> </td> <td colspan="2" nowrap="nowrap" align="right"><b>2% to 3</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">1.5% to 3</td> <td>%</td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">3% to 4</td> <td>%</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected long-term return on plan assets </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>8.75</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">8.75</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">8.75</td> <td nowrap="nowrap">%</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>International Plans:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Discount rate </div></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap"><b>5.25% to 8.5</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">5.75% to 9</td> <td>%</td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">5.25% to 8.49</td> <td>%</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Future compensation assumption </div></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap"><b>2.66% to 6.12</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">2.75% to 6.31</td> <td>%</td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">2.75% to 5.19</td> <td>%</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Expected long-term return on plan assets </div></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap"><b>4.25% to 9.5</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">4.5% to 9.2</td> <td>%</td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">4.5% to 8.68</td> <td>%</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="25" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The discount rate assumption is based on current rates of high-quality long-term corporate bonds over the same period that benefit payments will be required to be made. The expected rate of return on plan assets assumption is based on the weighted-average expected return on the various asset classes in the plans’ portfolio. The asset class return is developed using historical asset return performance as well as current market conditions such as inflation, interest rates and equity market performance. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Effective December 31, 2009, the Company sold its NRB operations. As part of the sale, JTEKT assumed responsibility for the pension obligations with respect to current employees, as well as certain retired employees. The net periodic benefit cost related to these obligations included $2.6 million and $2.8 million in 2009 and 2008, respectively, related to the NRB operations and has been classified as discontinued operations. In addition, the Company recognized a total settlement of $17.6 million in 2009 as a result of JTEKT assuming responsibility for certain pension obligations. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">For expense purposes in 2010, the Company applied a discount rate of 6.00% to its U.S. defined benefit pension plans and 5.75% for the postretirement welfare plans. For expense purposes, in 2011 the Company will apply a discount rate of 5.75% to its U.S. defined benefit pension plans and 5.50% for the postretirement welfare plans. A 0.25 percentage point reduction in the discount rate would increase pension expense by approximately $4.6 million for the defined benefit pension plans and $0.5 million for the postretirement benefit plans for 2011. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">For expense purposes in 2010, the Company applied an expected rate of return of 8.75% for the Company’s U.S. pension plan assets. For expense purposes in 2011, the Company will apply an expected rate of return on plan assets of 8.5%. A 0.25 percentage point reduction in the expected rate of return would increase pension expense by approximately $5.7 million for 2011. In addition, at the end of 2010 the Company established a Voluntary Employee Benefit Association (VEBA) for certain bargained associates’ retiree medical benefits. Beginning in 2011, the Company will apply an expected rate of return of 5.00% to the VEBA assets for expense purposes. The expected return will decrease expense for postretirement benefits by approximately $2.7 million in 2011. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following tables set forth the change in benefit obligation, change in plan assets, funded status and amounts recognized on the Consolidated Balance Sheet of the defined benefit pension and postretirement benefits as of December 31, 2010 and 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Defined Benefit</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Postretirement</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Pension Plans</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Benefit Plans</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Change in benefit obligation</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Benefit obligation at beginning of year </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,767.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2,600.9</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>662.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">671.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Service cost </div></td> <td> </td> <td> </td> <td align="right"><b>32.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">39.7</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Interest cost </div></td> <td> </td> <td> </td> <td align="right"><b>157.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">158.9</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>35.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">39.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Amendments </div></td> <td> </td> <td> </td> <td align="right"><b>1.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">5.4</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.7</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.4</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Actuarial losses (gains) </div></td> <td> </td> <td> </td> <td align="right"><b>60.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">120.8</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(5.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">8.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Associate contributions </div></td> <td> </td> <td> </td> <td align="right"><b>0.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">International plan exchange rate change </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(11.4</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">33.0</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Divestitures </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(5.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(17.6</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Curtailment gain </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(6.7</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Benefits paid </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(186.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(171.0</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(53.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(52.5</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Settlements </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.8</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Benefit obligation at end of year </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,816.3</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2,767.6</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>644.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">662.7</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Defined Benefit</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Postretirement</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Pension Plans</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Benefit Plans</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Change in plan assets</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Fair value of plan assets at beginning of year </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,079.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,757.8</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Actual return on plan assets </div></td> <td> </td> <td> </td> <td align="right"><b>311.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">402.9</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Associate contributions </div></td> <td> </td> <td> </td> <td align="right"><b>0.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Company contributions / payments </div></td> <td> </td> <td> </td> <td align="right"><b>230.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">62.6</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>107.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">52.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">International plan exchange rate change </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(5.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">27.2</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Divesitures </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(6.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Benefits paid </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(186.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(171.0</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(53.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(52.5</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Fair value of plan assets at end of year </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,423.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2,079.8</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>54.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Funded status at end of year </div></td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(393.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(687.8</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(590.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(662.7</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="top"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Amounts recognized on the Consolidated Balance Sheets</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Non-current assets </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>6.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">8.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Current liabilities </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(5.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(5.6</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(58.8</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(58.5</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Non-current liabilities </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(394.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(690.9</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(531.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(604.2</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(393.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(687.8</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"><b>$</b></td> <td align="right"><b>(590.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(662.7</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="top"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Amounts recognized in accumulated other comprehensive income</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net actuarial loss </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>966.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,072.3</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>104.1</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">113.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net prior service cost </div></td> <td> </td> <td> </td> <td align="right"><b>32.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">41.4</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>6.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Accumulated other comprehensive income </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>999.1</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,113.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>110.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">116.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="top"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Changes in plan assets and benefit obligations recognized in accumulated other comprehensive income (AOCI)</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">AOCI at beginning of year </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,113.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,240.2</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>116.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">116.7</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net actuarial (gain) loss </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(51.1</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(90.7</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(5.4</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">1.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Prior service cost (credit) </div></td> <td> </td> <td> </td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">1.3</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.7</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.4</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Recognized transition asset </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.1</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Recognized net actuarial loss </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(51.9</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(35.8</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(4.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.7</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Recognized prior service (cost) credit </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(9.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(11.3</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right"><b>1.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.2</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency impact </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(2.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">9.9</td> <td> </td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Total recognized in accumulated other comprehensive income at December 31 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>999.1</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,113.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>110.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">116.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The presentation in the above tables for amounts recognized in accumulated other comprehensive income (loss) on the Consolidated Balance Sheets is before the effect of income taxes. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table summarizes assumptions used to measure the benefit obligation for the defined benefit pension and postretirement benefit plans at December 31: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Defined Benefit Pension Plans</b></td> <td nowrap="nowrap" align="center" colspan="1" style="border-bottom: 1px solid #000000"><b> </b></td> <td nowrap="nowrap" align="center" colspan="9" style="border-bottom: 1px solid #000000"><b>Postretirement Benefit Plans</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assumptions</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>U.S. Plans:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Discount rate </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>5.75</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">6.0</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>5.5</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">5.75</td> <td nowrap="nowrap">%</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Future compensation assumption </div></td> <td> </td> <td colspan="2" nowrap="nowrap" align="right"><b>2% to 3</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" nowrap="nowrap" align="right">1.5% to 3</td> <td>% </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>International Plans:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Discount rate </div></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap"><b>4.75% to 9</b></td> <td><b>%</b></td> <td> </td> <td colspan="2" align="right" nowrap="nowrap">5.25% to 8.5</td> <td>% </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Future compensation assumption </div></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right"><b>2.5% to 8.84</b></td> <td><b>%</b></td> <td> </td> <td nowrap="nowrap" colspan="2" align="right">2.66% to 6.12%</td> <td>% </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Defined benefit pension plans in the United States represent 86% of the benefit obligation and 87% of the fair value of plan assets as of December 31, 2010. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Certain of the Company’s defined benefit pension plans are overfunded as of December 31, 2010. As a result, $6.9 million and $8.7 million at December 31, 2010 and 2009, respectively, are included in other non-current assets on the Consolidated Balance Sheets. The current portion of accrued pension cost, which is included in salaries, wages and benefits on the Consolidated Balance Sheets, was $5.7 million and $5.6 million at December 31, 2010 and 2009, respectively. The current portion of accrued postretirement benefit cost, which is included in salaries, wages and benefits on the Consolidated Balance Sheets, was $58.8 million and $58.5 million at December 31, 2010 and 2009, respectively. In 2010, the current portion of accrued pension cost and accrued postretirement benefit cost relates to unfunded plans and represents the actuarial present value of expected payments related to the plans to be made over the next 12 months. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The accumulated benefit obligations at December 31, 2010 exceeded the market value of plan assets for the majority of the Company’s pension plans. For these plans, the projected benefit obligation was $2.8 billion, the accumulated benefit obligation was $2.7 billion and the fair value of plan assets was $2.3 billion at December 31, 2010. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Due to significant increases in the global capital markets in 2010, investment performance increased the value of the Company’s pension assets by 15%. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2010 and 2009, the Company’s defined benefit pension plans did not hold a material amount of shares of the Company’s common stock. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The estimated net loss and prior service cost for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $59.7 million and $9.4 million, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The estimated net loss and prior service credit for the postretirement plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year are $4.7 million and $(0.3) million, respectively. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">For measurement purposes, the Company assumed a weighted average annual rate of increase in the per capita cost (health care cost trend rate) for medical benefits of 9.2% for 2011, declining gradually to 5.0% in 2078 and thereafter; and 10.5% for 2011, declining gradually to 5.0% in 2078 and thereafter for prescription drug benefits and HMO benefits. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The assumed health care cost trend rate may have a significant effect on the amounts reported. A one percentage point increase in the assumed health care cost trend rate would increase the 2010 total service and interest cost components by $1.0 million and would increase the postretirement benefit obligation by $17.9 million. A one percentage point decrease would provide corresponding reductions of $0.9 million and $16.2 million, respectively. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Patient Protection and Affordable Care Act (PPACA) was enacted on March 23, 2010. PPACA consists of a broad range of provisions that may impact future plan design and administrative cost. The Company’s actuary determined the impact PPACA has on the accumulated postretirement benefit obligation, to the extent measurable. The effect of PPACA resulted in an increase in the reported postretirement benefit obligation of approximately $3.5 million. The net periodic postretirement benefit cost for 2010 was not impacted by PPACA. It has been estimated that the 2011 net periodic postretirement benefit cost will increase by approximately $0.6 million to reflect the impact of PPACA. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (the Medicare Act) was signed into law on December 8, 2003. The Medicare Act provides for prescription drug benefits under Medicare Part D and contains a subsidy to plan sponsors who provide “actuarially equivalent” prescription plans. The Company’s actuary determined that the prescription drug benefit provided by the Company’s postretirement plan is considered to be actuarially equivalent to the benefit provided under the Medicare Act. In accordance with Accounting Standards Codification (ASC) 715, “Compensation — Retirement Benefits,” all measures of the accumulated postretirement benefit obligation or net periodic postretirement benefit cost in the financial statements or accompanying notes reflect the effects of the Medicare Act on the plan for the entire fiscal year. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"> The effect on the accumulated postretirement benefit obligation attributed to past service cost as of December 31, 2010 was a reduction of $7.6 million and the effect on the amortization of actuarial losses, service cost and interest cost components of net periodic benefit cost was a reduction of $2.3 million for 2010. The 2010 expected subsidy was $3.3 million, of which $1.8 million was received prior to December 31, 2010. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Plan Assets: </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company’s target allocation for U.S. pension plan assets, as well as the actual pension plan asset allocations as of December 31, 2010 and 2009 were as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Percentage of Pension Plan Assets at</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Current Target</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>December 31,</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Asset Category</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Allocation</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Equity securities </div></td> <td> </td> <td colspan="2" align="center"><b>55% to 65</b></td> <td><b>%</b> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">59</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">61</td> <td nowrap="nowrap">%</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Debt securities </div></td> <td> </td> <td colspan="2" nowrap="nowrap" align="center"><b>35% to 45</b></td> <td><b>%</b> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">41</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">39</td> <td nowrap="nowrap">%</td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Total </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>100</b></td> <td nowrap="nowrap"><b>%</b> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">100</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">100</td> <td nowrap="nowrap">%</td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company recognizes its overall responsibility to ensure that the assets of its various defined benefit pension plans are managed effectively and prudently and in compliance with its policy guidelines and all applicable laws. Preservation of capital is important; however, the Company also recognizes that appropriate levels of risk are necessary to allow its investment managers to achieve satisfactory long-term results consistent with the objectives and the fiduciary character of the pension funds. Asset allocations are established in a manner consistent with projected plan liabilities, benefit payments and expected rates of return for various asset classes. The expected rate of return for the investment portfolio is based on expected rates of return for various asset classes, as well as historical asset class and fund performance. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table presents the fair value hierarchy for those investments of the Company’s pension assets measured at fair value on a recurring basis as of December 31, 2010: </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The FASB provides accounting rules that classify the inputs used to measure fair value into the following hierarchy: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="80%"> </td> </tr>   <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Level 1 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unadjusted quoted prices in active markets for identical assets or liabilities.</td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top">Level 2 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.</td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top">Level 3 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unobservable inputs for the asset or liability.</td> </tr>  </table> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Total</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 1</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 2</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 3</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assets:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Cash and cash equivalents </div></td> <td> </td> <td align="right">$</td> <td align="right">61.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">61.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Government and agency securities </div></td> <td> </td> <td> </td> <td align="right">155.5</td> <td> </td> <td> </td> <td> </td> <td align="right">129.2</td> <td> </td> <td> </td> <td> </td> <td align="right">26.3</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Corporate bonds </div></td> <td> </td> <td> </td> <td align="right">470.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">470.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Equity securities </div></td> <td> </td> <td> </td> <td align="right">845.4</td> <td> </td> <td> </td> <td> </td> <td align="right">845.4</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Asset backed securities </div></td> <td> </td> <td> </td> <td align="right">21.8</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">21.8</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Common collective funds — equities </div></td> <td> </td> <td> </td> <td align="right">483.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">464.5</td> <td> </td> <td> </td> <td> </td> <td align="right">19.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Common collective funds — fixed income </div></td> <td> </td> <td> </td> <td align="right">317.4</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">317.4</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Common collective funds — other </div></td> <td> </td> <td> </td> <td align="right">25.1</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">25.1</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Limited partnerships </div></td> <td> </td> <td> </td> <td align="right">94.8</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">94.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other assets </div></td> <td> </td> <td> </td> <td align="right">0.7</td> <td> </td> <td> </td> <td> </td> <td align="right">0.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Total Assets</b> </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,477.0</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,037.2</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,325.8</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>114.0</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Included in cash and cash equivalents in the table above is the $54 million contribution made to the VEBA trust. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The table below sets forth a summary of changes in the fair value of the Plan’s level 3 assets for the year ended December 31, 2010: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="88%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Limited Partnerships and Equities:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Balance, beginning of year </div></td> <td> </td> <td align="right">$</td> <td align="right">106.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Purchases and sales, net </div></td> <td> </td> <td> </td> <td align="right">4.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Realized/unrealized loss, net </div></td> <td> </td> <td> </td> <td align="right">3.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="5" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>114.0</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="5" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Cash and cash equivalents are valued at redemption value. Government and agency securities are valued at the closing price reported in the active market on which the individual securities are traded. Certain corporate bonds are valued at the closing price reported in the active market in which the bond is traded. Bonds are not traded on a daily basis and there are multiple pricing services that provide input for closing price valuations. Equity securities (both common and preferred stock) are valued at the closing price reported in the active market in which the individual security is traded. Common collective funds and asset-backed securities are valued based on quoted prices for similar assets in active markets. When such prices are unavailable, the Trustee determines a valuation from the market maker dealing in the particular security. The value of limited partnerships is based upon the general partner’s own assumptions about the assumptions a market participant would use in pricing the assets and liabilities of the partnership. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">On February 12, 2009, the Company was informed of alleged irregularities in the operation of an equity-related investment in its defined benefit pension plans. A court-appointed receiver is now in control of the investment firm and is conducting an ongoing investigation into the matter. In the fourth quarter of 2009, the Company reduced the value of this investment to its net realizable value of $19.3 million (the original investment was $50 million), reflecting the receiver’s preliminary findings. The net realizable value of this investment may be more or less than estimated. However, the Company believes this investment is properly valued at December 31, 2010. In July 2010, the Company received $20 million of insurance proceeds related to the loss. The insurance proceeds were sent to the pension trust and redeployed into other assets within defined benefit pension plans. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Cash Flows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="88%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Employer Contributions to Defined Benefit Plans</b></td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>   <tr style="font-size: 1px"> <td colspan="5" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2009 </div></td> <td> </td> <td align="right">$</td> <td align="right">62.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">2010 </div></td> <td> </td> <td> </td> <td align="right">230.0</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2011 (planned) </div></td> <td> </td> <td> </td> <td align="right">120.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="5" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Future benefit payments are expected to be as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>Postretirement Benefits</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Expected</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Net</b> <b>Including</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Medicare</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Medicare</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Benefit Payments</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Pension Benefits</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Gross</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Subsidies</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Subsidies</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2011 </div></td> <td> </td> <td align="right">$</td> <td align="right">177.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">63.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">60.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">2012 </div></td> <td> </td> <td> </td> <td align="right">182.4</td> <td> </td> <td> </td> <td> </td> <td align="right">62.9</td> <td> </td> <td> </td> <td> </td> <td align="right">3.0</td> <td> </td> <td> </td> <td> </td> <td align="right">59.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2013 </div></td> <td> </td> <td> </td> <td align="right">184.9</td> <td> </td> <td> </td> <td> </td> <td align="right">62.3</td> <td> </td> <td> </td> <td> </td> <td align="right">3.2</td> <td> </td> <td> </td> <td> </td> <td align="right">59.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">2014 </div></td> <td> </td> <td> </td> <td align="right">184.5</td> <td> </td> <td> </td> <td> </td> <td align="right">61.2</td> <td> </td> <td> </td> <td> </td> <td align="right">3.3</td> <td> </td> <td> </td> <td> </td> <td align="right">57.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2015 </div></td> <td> </td> <td> </td> <td align="right">186.9</td> <td> </td> <td> </td> <td> </td> <td align="right">59.5</td> <td> </td> <td> </td> <td> </td> <td align="right">2.7</td> <td> </td> <td> </td> <td> </td> <td align="right">56.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">2016-2020 </div></td> <td> </td> <td> </td> <td align="right">984.7</td> <td> </td> <td> </td> <td> </td> <td align="right">268.8</td> <td> </td> <td> </td> <td> </td> <td align="right">11.7</td> <td> </td> <td> </td> <td> </td> <td align="right">257.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The pension accumulated benefit obligation was $2.8 billion and $2.7 billion at December 31, 2010 and 2009, respectively. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 13 – Segment Information</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><i>Description of types of products and services from which each reportable segment derives its revenues</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company’s reportable segments are business units that target different industry segments. Each reportable segment is managed separately because of the need to specifically address customer needs in these different industries. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Mobile Industries segment includes global sales of bearings, power transmission components and other products and services (other than steel) to a diverse customer base, including original equipment manufacturers and their suppliers of passenger cars, light trucks, medium to heavy-duty trucks, rail cars, locomotives, agricultural, construction and mining equipment. The Mobile Industries segment also includes aftermarket distribution operations for automotive applications. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Process Industries segment includes global sales of bearings, power transmission components and other products and services (other than steel) to a diverse customer base including those in the power transmission, energy and heavy industry market sectors. The Process Industries segment also includes aftermarket distribution operations for products other than steel and automotive applications. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Aerospace and Defense segment includes sales of bearings, helicopter transmission systems, rotor head assemblies, turbine engine components, gears and other precision flight-critical components for commercial and military aviation applications. The Aerospace and Defense segment also provides aftermarket services, including repair and overhaul of engines, transmissions and fuel controls as well as aerospace bearing repair and component reconditioning. The Aerospace and Defense segment also includes sales of bearings and related products for health and positioning control applications. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Steel segment includes sales of low and intermediate alloy and carbon grade steel in a wide range of solid and tubular sections with a variety of finishes. The Company also manufactures custom-made steel products including precision steel components. Approximately less than 10% of the Company’s steel is consumed in its bearing operations. In addition, sales are made to other anti-friction bearing companies and to aircraft, automotive, forging, tooling, oil and gas drilling industries and steel service centers. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Measurement of segment profit or loss and segment assets</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company evaluates performance and allocates resources based on return on capital and profitable growth. The primary measurement used by management to measure the financial performance of each segment is “adjusted EBIT” (earnings before interest and taxes, excluding the effects of amounts related to certain items that management considers not representative of ongoing operations such as impairment and restructuring charges, manufacturing rationalization and integration costs, one-time gains and losses on disposal of non-strategic assets, allocated receipts or payments made under the U.S. Continued Dumping and Subsidy Offset Act (CDSOA), gains and losses on the dissolution of a subsidiary, acquisition-related currency exchange gains, and other items similar in nature). Beginning in 2011, the primary measurement used by management to measure the financial performance of each segment will be EBIT (earnings before interest and taxes, including the effects of amounts related to certain items that management considers not representative of ongoing operations such as impairment and restructuring charges, manufacturing rationalization and integration costs, one-time gains and losses on disposal of non-strategic assets, allocated receipts or payments made under the CDSOA, gains and losses on the dissolution of a subsidiary, acquisition-related currency exchange gains, and other items similar in nature). The change in 2011 is primarily due to the completion of most of the Company’s previously-announced restructuring initiatives. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment sales and transfers are recorded at values based on market prices, which creates intercompany profit on intersegment sales or transfers that is eliminated in consolidation. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Factors used by management to identify the enterprise’s reportable segments</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company reports net sales by geographic area in a manner that is more reflective of how the Company operates its segments, which is by the destination of net sales. Long-lived assets by geographic area are reported by the location of the subsidiary. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Segment Financial Information </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Geographic Financial Information</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>United States</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Europe</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Other<br /> Countries</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Consolidated</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>2010</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net sales</b> </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2,662.7</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>516.0</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>876.8</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4,055.5</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Long-lived assets</b> </div></td> <td> </td> <td> </td> <td align="right"><b>918.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>101.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>247.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1,267.7</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">2009 </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net sales </div></td> <td> </td> <td align="right">$</td> <td align="right">1,943.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">536.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">662.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3,141.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Long-lived assets </div></td> <td> </td> <td> </td> <td align="right">976.4</td> <td> </td> <td> </td> <td> </td> <td align="right">117.2</td> <td> </td> <td> </td> <td> </td> <td align="right">241.6</td> <td> </td> <td> </td> <td> </td> <td align="right">1,335.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">2008 </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net sales </div></td> <td> </td> <td align="right">$</td> <td align="right">3,339.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">852.3</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">849.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5,040.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Long-lived assets </div></td> <td> </td> <td> </td> <td align="right">1,140.3</td> <td> </td> <td> </td> <td> </td> <td align="right">149.5</td> <td> </td> <td> </td> <td> </td> <td align="right">227.2</td> <td> </td> <td> </td> <td> </td> <td align="right">1,517.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net sales to external customers:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,560.3</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,245.0</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,771.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>900.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">806.0</td> <td> </td> <td> </td> <td> </td> <td align="right">1,163.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>338.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">417.7</td> <td> </td> <td> </td> <td> </td> <td align="right">411.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>1,256.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">672.9</td> <td> </td> <td> </td> <td> </td> <td align="right">1,694.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4,055.5</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3,141.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5,040.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Intersegment sales:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>3.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.7</td> <td> </td> <td> </td> <td> </td> <td align="right">3.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>102.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">42.0</td> <td> </td> <td> </td> <td> </td> <td align="right">158.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>106.3</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">44.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">161.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Segment EBIT, as adjusted:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>223.5</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">30.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">35.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>138.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">118.5</td> <td> </td> <td> </td> <td> </td> <td align="right">218.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>21.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">72.5</td> <td> </td> <td> </td> <td> </td> <td align="right">41.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>146.3</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(57.9</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">264.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total EBIT, as adjusted, for reportable segments </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>529.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">163.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">559.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Unallocated corporate expenses </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(66.8</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(48.7</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(68.3</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Impairment and restructuring </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(21.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(164.1</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(32.8</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Rationalization and integration charges </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(6.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(11.1</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(4.9</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Gain on sale of non-strategic assets, net of dissolution of subsidiary </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.5</td> <td> </td> <td> </td> <td> </td> <td align="right">19.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">CDSOA receipts, net of expenses </div></td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">3.6</td> <td> </td> <td> </td> <td> </td> <td align="right">9.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Impairment of equity investments </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(6.1</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Other </div></td> <td> </td> <td> </td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Interest expense </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(38.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(41.9</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(44.4</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Interest income </div></td> <td> </td> <td> </td> <td align="right"><b>3.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">1.9</td> <td> </td> <td> </td> <td> </td> <td align="right">5.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Intersegment adjustments </div></td> <td> </td> <td> </td> <td align="right"><b>3.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">8.1</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.9</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Income (loss) from continuing operations before income taxes </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>405.5</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(94.2</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">439.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assets employed at year-end:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,124.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,226.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1,325.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>707.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">682.9</td> <td> </td> <td> </td> <td> </td> <td align="right">910.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>500.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">531.5</td> <td> </td> <td> </td> <td> </td> <td align="right">603.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>809.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">633.6</td> <td> </td> <td> </td> <td> </td> <td align="right">901.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Corporate </div></td> <td> </td> <td> </td> <td align="right"><b>1,037.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right">932.2</td> <td> </td> <td> </td> <td> </td> <td align="right">342.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Discontinued Operations </div></td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">452.5</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4,180.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">4,006.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">4,536.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Capital expenditures:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>20.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">23.8</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">55.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>41.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right">51.1</td> <td> </td> <td> </td> <td> </td> <td align="right">82.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>9.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">8.5</td> <td> </td> <td> </td> <td> </td> <td align="right">19.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>43.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">29.9</td> <td> </td> <td> </td> <td> </td> <td align="right">98.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Corporate </div></td> <td> </td> <td> </td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">0.8</td> <td> </td> <td> </td> <td> </td> <td align="right">2.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>115.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">114.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">258.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Depreciation and amortization:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Mobile Industries </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>74.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">86.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">88.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Process Industries </div></td> <td> </td> <td> </td> <td align="right"><b>42.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">41.6</td> <td> </td> <td> </td> <td> </td> <td align="right">40.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Aerospace and Defense </div></td> <td> </td> <td> </td> <td align="right"><b>24.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right">25.2</td> <td> </td> <td> </td> <td> </td> <td align="right">22.7</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Steel </div></td> <td> </td> <td> </td> <td align="right"><b>46.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">45.9</td> <td> </td> <td> </td> <td> </td> <td align="right">48.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Corporate </div></td> <td> </td> <td> </td> <td align="right"><b>2.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.4</td> <td> </td> <td> </td> <td> </td> <td align="right">0.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>189.7</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">201.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">200.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 14 – Income Taxes</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Income or loss from continuing operations before income taxes, based on geographic location of the operations to which such earnings are attributable, is provided below. As the Company has elected to treat certain foreign subsidiaries as branches for U.S. income tax purposes, pretax income attributable to the United States shown below may differ from the pretax income reported on the Company’s annual U.S. Federal income tax return. </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11"><b>Income (loss) from continuing</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="11" style="border-bottom: 1px solid #000000"><b>operations before income taxes</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">United States </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>281.6</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(51.4</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">279.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Non-United States </div></td> <td> </td> <td> </td> <td align="right"><b>123.9</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(42.8</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">160.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Income (loss) from continuing operations before income taxes </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>405.5</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(94.2</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">439.6</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The provision (benefit) for income taxes consisted of the following: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Current:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Federal </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>48.3</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(51.8</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">93.3</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">State and local </div></td> <td> </td> <td> </td> <td align="right"><b>2.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">2.4</td> <td> </td> <td> </td> <td> </td> <td align="right">14.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign </div></td> <td> </td> <td> </td> <td align="right"><b>26.3</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.6</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">47.7</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right"><b>77.2</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(51.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">155.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Deferred:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Federal </div></td> <td> </td> <td> </td> <td align="right"><b>57.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">33.2</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.2</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">State and local </div></td> <td> </td> <td> </td> <td align="right"><b>1.2</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(6.4</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(0.3</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(4.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">1.1</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right"><b>58.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right">22.8</td> <td> </td> <td> </td> <td> </td> <td align="right">1.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">United States and foreign tax expense (benefit) on income (loss) </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>136.0</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(28.2</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">157.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company received net income tax refunds of approximately $16.0 million and $3.3 million in 2010 and 2009, respectively, and made net income tax payments of approximately $118.9 million in 2008. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table is the reconciliation between the provision (benefit) for income taxes and the amount computed by applying the U.S. Federal income tax rate of 35% to income before taxes: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2008</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Income tax at the U.S. federal statutory rate </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>141.9</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(33.0</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">153.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Adjustments: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">State and local income taxes, net of federal tax benefit </div></td> <td> </td> <td> </td> <td align="right"><b>2.5</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.6</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">9.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Tax on foreign remittances and U.S. tax on foreign income </div></td> <td> </td> <td> </td> <td align="right"><b>5.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right">4.3</td> <td> </td> <td> </td> <td> </td> <td align="right">5.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign losses without current tax benefits </div></td> <td> </td> <td> </td> <td align="right"><b>5.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">13.3</td> <td> </td> <td> </td> <td> </td> <td align="right">7.7</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Foreign earnings taxed at different rates including tax holidays </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(12.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.7</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(21.2</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">U.S. domestic manufacturing deduction </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(3.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">1.3</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.5</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">U.S. research tax credit </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(2.2</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.0</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.9</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Accruals and settlements related to tax audits </div></td> <td> </td> <td> </td> <td align="right"><b>2.5</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.7</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">4.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Patient Protection and Affordable Care Act </div></td> <td> </td> <td> </td> <td align="right"><b>21.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Contributions to voluntary employee benefits association </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(19.8</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Other items, net </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(6.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.1</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">1.5</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Provision (benefit) for income taxes </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>136.0</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(28.2</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">157.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Effective income tax rate </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>33.5</b></td> <td nowrap="nowrap"><b>%</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">29.9</td> <td nowrap="nowrap">%</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">35.7</td> <td nowrap="nowrap">%</td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In connection with various investment arrangements, the Company has been granted “holidays” from income taxes at two affiliates in Asia. These agreements began to expire in 2010, with full expiration in 2018. In total, the agreements reduced income tax expense by $1.1 million and $3.2 million in 2010 and 2008, respectively, and had no effect on the 2009 tax benefit. These savings resulted in an increase to earnings per diluted share of $0.01 in 2010 and $0.03 in 2008. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Income tax expense includes U.S. and international taxes. Except as required under U.S. tax law, management does not provide U.S. taxes on undistributed earnings of foreign subsidiaries that have not been previously taxed since management intends to invest such undistributed earnings indefinitely outside of the United States. Undistributed earnings of foreign subsidiaries that are indefinitely outside of the U.S. were $484.0 million and $456.0 million at December 31, 2010 and December 31, 2009, respectively. Determination of the unrecognized deferred tax liability that would be incurred if such amounts were repatriated is not practicable. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The effect of temporary differences giving rise to deferred tax assets and liabilities at December 31, 2010 and 2009 was as follows: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Deferred tax assets: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Accrued postretirement benefits cost </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>190.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">213.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Accrued pension cost </div></td> <td> </td> <td> </td> <td align="right"><b>185.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right">278.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Inventory </div></td> <td> </td> <td> </td> <td align="right"><b>27.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">30.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Other employee benefit accruals </div></td> <td> </td> <td> </td> <td align="right"><b>7.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right">4.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Tax loss and credit carryforwards </div></td> <td> </td> <td> </td> <td align="right"><b>140.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">194.4</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Other, net </div></td> <td> </td> <td> </td> <td align="right"><b>60.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right">29.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Valuation allowances </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(174.9</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(222.4</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td align="right"><b>436.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right">527.9</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Deferred tax liabilities — principally depreciation and amortization </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(221.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(233.1</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net deferred tax assets </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>215.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">294.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company has U.S. loss carryforwards with tax benefits totaling $4.8 million and $3.2 million, respectively, portions of which will expire at the end of 2011. In addition, the Company had loss carryforwards in various non-U.S. jurisdictions with tax benefits totaling $132.4 million having various expiration dates. The Company has provided valuation allowances of $136.8 million against certain of these carryforwards. The majority of the non-U.S. loss carryforwards represent local country net operating losses for branches of the Company or entities treated as branches of the Company under U.S. tax law. Tax benefits have been recorded for these losses in the United States. The related local country net operating loss carryforwards are offset fully by valuation allowances. In addition to loss and credit carryforwards, the Company has provided valuation allowances of $38.1 million against other deferred tax assets. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2010, the Company had approximately $77.8 million of total gross unrecognized tax benefits. Included in this amount was approximately $46.1 million, which represented the amount of unrecognized tax benefits that would favorably impact the Company’s effective income tax rate in any future periods if such benefits were recognized. As of December 31, 2010, the Company anticipates a decrease in its unrecognized tax positions of approximately $1.0 million to $2.0 million during the next 12 months. The anticipated decrease is primarily due to the expiration of various statutes of limitations. As of December 31, 2010, the Company has accrued approximately $6.8 million of interest and penalties related to uncertain tax positions. The Company records interest and penalties related to uncertain tax positions as a component of income tax expense. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2009, the Company had approximately $77.8 million of total gross unrecognized tax benefits. Included in this amount was approximately $44.8 million, which represented the amount of unrecognized tax benefits that would favorably impact the Company’s effective income tax rate in any future periods if such benefits were recognized. As of December 31, 2009, the Company had accrued approximately $6.0 million of interest and penalties related to uncertain tax positions. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table reconciles the Company’s total gross unrecognized tax benefits for the years ended December 31, 2010 and 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="76%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Beginning balance, January 1 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>77.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">71.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Tax positions related to the current year: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Additions </div></td> <td> </td> <td> </td> <td align="right"><b>5.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right">5.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Tax positions related to prior years: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Additions </div></td> <td> </td> <td> </td> <td align="right"><b>15.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right">27.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Reductions </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(8.7</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(17.1</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Settlements with tax authorities </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(9.0</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Lapses in statutes of limitation </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(3.5</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(9.8</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Ending balance, December 31 </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>77.8</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">77.8</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="9" align="left" style="border-top: 2px solid #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During 2010, gross unrecognized tax benefits increased primarily due to net additions related to various prior year and current year tax matters, including U.S. state and local taxes and taxes related to the Company’s international operations. These increases were offset entirely by reductions related to prior year and current year tax matters, including U.S. state and local taxes, taxes related to the Company’s international operations and the settlement of tax matters with government authorities and lapses in the statute of limitation on various tax matters. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The increase in gross unrecognized tax benefits of $6.0 million during 2009 was primarily due to net additions related to various prior year and current year tax matters, including U.S. state and local taxes, tax credits and taxes related to the Company’s international operations. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">As of December 31, 2010, the Company is subject to examination by the IRS for tax years 2006 to the present. The Company is also subject to tax examination in various U.S. state and local tax jurisdictions for tax years 2006 to the present as well as various foreign tax jurisdictions, including France, Germany, Czech Republic, India and Canada, for tax years 2003 to the present. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The current portion of the Company’s unrecognized tax benefits is presented on the Consolidated Balance Sheet within income taxes payable and the non-current portion is presented as a component of other non-current liabilities. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 15 – Fair Value</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). The FASB provides accounting rules that classify the inputs used to measure fair value into the following hierarchy: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="1%"> </td> <td width="80%"> </td> </tr>   <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Level 1 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unadjusted quoted prices in active markets for identical assets or liabilities.</td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top">Level 2 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unadjusted quoted prices in active markets for similar assets or liabilities, or unadjusted quoted prices for identical or similar assets or liabilities in markets that are not active, or inputs other than quoted prices that are observable for the asset or liability.</td> </tr> <tr valign="bottom"> <td valign="top"> <div style="margin-left:0px; text-indent:-0px">  </div></td> <td> </td> <td align="left" valign="top">Level 3 </td> <td> </td> <td align="left" valign="top">— </td> <td> </td> <td align="left" valign="top">Unobservable inputs for the asset or liability.</td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following tables present the fair value hierarchy for those assets and liabilities measured at fair value on a recurring basis as of December 31, 2010 and 2009: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="42%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>Fair Value at December 31, 2010</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Total</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 1</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 2</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 3</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assets:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Cash </div></td> <td> </td> <td align="right">$</td> <td align="right">877.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">877.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Short-term investments </div></td> <td> </td> <td> </td> <td align="right">15.0</td> <td> </td> <td> </td> <td> </td> <td align="right">15.0</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency hedges </div></td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total Assets</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">893.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">892.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.0</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Liabilities:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency hedges </div></td> <td> </td> <td align="right">$</td> <td align="right">3.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total Liabilities</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">3.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3.2</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="42%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="4%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="15" style="border-bottom: 1px solid #000000"><b>Fair Value at December 31, 2009</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Total</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 1</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 2</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Level 3</b></td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Assets:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Cash </div></td> <td> </td> <td align="right">$</td> <td align="right">755.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">755.5</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Available-for-sale securities </div></td> <td> </td> <td> </td> <td align="right">6.9</td> <td> </td> <td> </td> <td> </td> <td align="right">6.9</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency hedges </div></td> <td> </td> <td> </td> <td align="right">2.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> <td> </td> <td> </td> <td align="right">2.7</td> <td> </td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total Assets</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">765.1</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">762.4</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.7</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Liabilities:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency hedges </div></td> <td> </td> <td align="right">$</td> <td align="right">5.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total Liabilities</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">5.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5.9</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Cash and cash equivalents are highly liquid investments with maturities of three month or less when purchased and are valued at redemption value. Short-term investments are investments with maturities between four months and one year and are valued at amortized cost. The Company uses publicly available foreign currency forward and spot rates to measure the fair value of its foreign currency forward contracts. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company does not believe it has significant concentrations of risk associated with the counterparts to its financial instruments. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table presents those assets measured at fair value on a nonrecurring basis for the year ended December 31, 2010 using Level 3 inputs: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Carrying</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Value</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Adjustment</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Long-lived assets held and used:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Machinery and equipment at Brazil subsidiary </div></td> <td> </td> <td align="right">$</td> <td align="right">1.1</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(1.0</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">0.1</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Machinery and equipment at Mesa, Arizona subsidiary </div></td> <td> </td> <td> </td> <td align="right">2.4</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">0.4</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Other fixed assets </div></td> <td> </td> <td> </td> <td align="right">1.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">0.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Indefinite-lived intangible assets </div></td> <td> </td> <td> </td> <td align="right">0.9</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.7</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">0.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total long-lived assets held and used</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">6.0</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(4.7</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">1.3</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2010, machinery and equipment associated with the manufacturing facility in Sao Paulo, Brazil, with a carrying value of $1.1 million, were written down to their fair value of $0.1 million, resulting in an impairment charge of $1.0 million. Machinery and equipment associated with a manufacturing facility in Mesa, Arizona, with a carrying value of $2.4 million, were written down to their fair value of $0.4 million, resulting in an impairment charge of $2.0 million. Other fixed assets at various locations, with a carrying value of $1.6 million, were written down to their fair value of $0.6 million, resulting in an impairment charge of $1.0 million. The fair value for these assets was based on the price that would be received in a current transaction to sell the assets on a standalone basis, considering the age and physical attributes of the equipment compared to the cost of similar used machinery and equipment, as these assets have been idled. Lastly, indefinite-lived intangible assets, with a carrying value of $0.9 million, were written down to their fair value of $0.2 million, resulting in an impairment charge of $0.7 million. The Company used an income approach (a discounted cash flow model) to arrive at the fair value of these intangible assets. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table presents those assets measured at fair value on a nonrecurring basis for the year ended December 31, 2009 using Level 3 inputs: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Carrying</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Value</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Adjustment</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value</td> </tr>   <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Long-lived assets held for sale:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Torrington campus office complex </div></td> <td> </td> <td align="right">$</td> <td align="right">4.4</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(4.4</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff; font-weight: bold"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total long-lived assets held for sale</b> </div></td> <td> </td> <td align="right">$</td> <td align="right">4.4</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(4.4</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Long-lived assets held and used:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Process Industries’ facilities </div></td> <td> </td> <td align="right">$</td> <td align="right">29.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(27.7</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">2.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Torrington campus office complex </div></td> <td> </td> <td> </td> <td align="right">2.0</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">—</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">U.S. packaged bearing product lines </div></td> <td> </td> <td> </td> <td align="right">86.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(43.4</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">43.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Canadian subsidiary product lines </div></td> <td> </td> <td> </td> <td align="right">9.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(7.9</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">1.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">French subsidiary product lines </div></td> <td> </td> <td> </td> <td align="right">13.3</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(11.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">2.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Chinese subsidiary product lines </div></td> <td> </td> <td> </td> <td align="right">3.3</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.3</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">1.0</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other U.S. product lines </div></td> <td> </td> <td> </td> <td align="right">20.2</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(6.0</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">14.2</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Equity investments </div></td> <td> </td> <td> </td> <td align="right">12.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(6.1</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">6.5</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Other fixed assets </div></td> <td> </td> <td> </td> <td align="right">3.3</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(2.9</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">0.4</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="font-weight: bold"> <td> <div style="margin-left:15px; text-indent:-15px">Total long-lived assets held and used </div></td> <td> </td> <td align="right">$</td> <td align="right">180.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(109.3</td> <td nowrap="nowrap">)</td> <td> </td> <td align="right">$</td> <td align="right">71.4</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="13" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">In 2009, assets held for sale of $4.4 million and assets held and used of $180.7 million were written down to their fair value of $71.4 million and impairment charges of $113.7 million were included in earnings. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Assets held for sale of $4.4 million and assets held and used of $2.0 million associated with the Company’s former Torrington campus office complex were written down to zero and an impairment charge was recognized for the full amount. The Company recognized an impairment charge in anticipation of recognizing a loss on the sale of these assets sold on July 20, 2009. The Company subsequently sold these assets for a pretax loss of $0.7 million. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Assets held and used associated with the rationalization of the Process Industries’ three Canton, Ohio bearing manufacturing facilities with a carrying value of $29.7 million were written down to their fair value of $2.0 million, resulting in an impairment charge of $27.7 million, which was included in earnings in 2009. The fair value for these assets was based on the price that would be received in a current transaction to sell the assets on a standalone basis considering the age and physical attributes of the equipment compared to the cost of similar used machinery and equipment. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Assets held and used associated with the Company’s packaged bearing product lines, with a carrying value of $86.7 million, were written down to their fair value of $43.3 million, resulting in an impairment charge of $43.4 million, which was included in earnings in 2009. The fair value for these product lines was primarily based on an “in-use” premise in which these assets would continue to be in service. The fair value for these assets was determined based on the price that would be received in a current transaction to sell the assets assuming the assets would be used with other assets as a group and that those assets would be available to market participants. The remaining fair value of these product lines was based on the price that would be received in a current transaction to sell the assets on a standalone basis, considering the age and physical attributes of the equipment compared to the cost of similar used machinery and equipment, as these assets were expected to be idled in the near future. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Assets held and used associated with product lines at the Company’s subsidiaries in Canada, France and China with a carrying value of $26.2 million were written down to their fair value of $5.0 million, resulting in an impairment charge of $21.2 million, which was included in earnings in 2009. The fair value for these assets was based on the price that would be received in a current transaction to sell the assets on a standalone basis, considering the age and physical attributes of the equipment compared to the cost of similar used machinery and equipment, as these assets were either idled or were expected to be idled soon. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Assets held and used associated with the Company’s other U.S. product lines, with a carrying value of $20.2 million, were written down to their fair value of $14.2 million, resulting in an impairment charge of $6.0 million, which was included in earnings in 2009. The fair value for these product lines was based on an “in-use” premise in which these assets would continue to be in service. The fair value for these assets was determined based on the price that would be received in a current transaction to sell the assets assuming the assets would be used with other assets as a group and that those assets would be available to market participants. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Two of the Company’s equity investments, International Component Supply LTDA and Endorsia.com International AB, were reviewed for impairment during the last half of 2009. With a combined carrying value of $12.6 million, these equity investments were written down to their collective fair value of $6.5 million, resulting in an impairment charge of $6.1 million recognized in Other (expense) income, net during the last half of 2009. The fair value for these investments was based on the estimated sales proceeds to be received from a third party if the Company were to sell its interest in either joint venture. As of December 31, 2010, neither joint venture had met the criteria to be classified as assets held for sale. However, during 2010, both joint ventures met the criteria for assets held for sale and were reclassified to other current assets. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Other fixed assets at various locations, with a carrying value of $3.3 million, were written down to their fair value of $0.4 million, resulting in an impairment charge of $2.9 million during 2009. The fair value for these assets was based on the price that would be received in a current transaction to sell the assets on a standalone basis, considering the age and physical attributes of the equipment compared to the cost of similar used machinery and equipment, as these assets had been idled. </div> <div align="left" style="font-size: 10pt; margin-top: 12pt"><u>Financial Instruments</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The carrying value of cash and cash equivalents, accounts receivable, commercial paper, short-term borrowings and accounts payable are a reasonable estimate of their fair value due to the short-term nature of these instruments. The fair value of the Company’s long-term fixed-rate debt, based on quoted market prices, was $468.7 million and $440.1 million at December 31, 2010 and 2009, respectively. The carrying value of this debt was $430.4 million and $430.6 million at December 31, 2010 and 2009, respectively. </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 16 – Derivative Instruments and Hedging Activities</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company is exposed to certain risks relating to its ongoing business operations. The primary risks managed by using derivative instruments are commodity price risk, foreign currency exchange rate risk and interest rate risk. Forward contracts on various commodities are entered into to manage the price risk associated with forecasted purchases of natural gas used in the Company’s manufacturing process. Forward contracts on various foreign currencies are entered into to manage the foreign currency exchange rate risk on forecasted revenue denominated in foreign currencies. Other forward exchange contracts on various foreign currencies are entered into to manage the foreign currency exchange rate risk associated with certain of the Company’s commitments denominated in foreign currencies. Interest rate swaps are entered into to manage interest rate risk associated with the Company’s fixed and floating-rate borrowings. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company designates certain foreign currency forward contracts as cash flow hedges of forecasted revenues and certain interest rate hedges as fair value hedges of fixed-rate borrowings. The majority of the Company’s natural gas forward contracts are not subject to any hedge designation as they are considered within the normal purchases exemption. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The Company does not purchase or hold any derivative financial instruments for trading purposes. As of December 31, 2010, the Company had $199.6 million of outstanding foreign currency forward contracts at notional value. The total notional value of foreign currency hedges as of December 31, 2009 was $248.0 million. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Cash Flow Hedging Strategy</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">For certain derivative instruments that are designated as and qualify as cash flow hedges (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk), the effective portion of the gain or loss on the derivative instrument is reported as a component of other comprehensive income and reclassified into earnings in the same line item associated with the forecasted transaction and in the same period or periods during which the hedged transaction affects earnings. The remaining gain or loss on the derivative instrument in excess of the cumulative change in the present value of future cash flows of the hedged item, if any (i.e., the ineffective portion), or hedge components excluded from the assessment of effectiveness, are recognized in the Consolidated Statement of Income during the current period. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">To protect against a reduction in the value of forecasted foreign currency cash flows resulting from export sales over the next year, the Company has instituted a foreign currency cash flow hedging program. The Company hedges portions of its forecasted intra-group revenue or expense denominated in foreign currencies with forward contracts. When the dollar strengthens significantly against foreign currencies, the decline in the present value of future foreign currency revenue is offset by gains in the fair value of the forward contracts designated as hedges. Conversely, when the dollar weakens, the increase in the present value of future foreign currency cash flows is offset by losses in the fair value of the forward contracts. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt"><u>Fair Value Hedging Strategy</u> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">For derivative instruments that are designated and qualify as fair value hedges (i.e., hedging the exposure to changes in the fair value of an asset or a liability or an identified portion thereof that is attributable to a particular risk), the gain or loss on the derivative instrument as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in the same line item associated with the hedged item (i.e., in “interest expense” when the hedged item is fixed-rate debt). </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following table presents the fair value and location of all assets and liabilities associated with the Company’s hedging instruments within the Consolidated Balance Sheets: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Asset Derivatives</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>Liability Derivatives</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center"><b>Balance Sheet</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Fair Value at</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value at</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>Fair Value</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Fair Value</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Location</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>12/31/10</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">12/31/09</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>at 12/31/10</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">at 12/31/09</td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Derivatives designated as hedging instruments</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency forward contracts </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Other non-current liabilities</td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="19" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Total derivatives designated as hedging instruments </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.4</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.9</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.9</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Derivatives not designated as hedging instruments</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td valign="top"> <div style="margin-left:15px; text-indent:-15px">Foreign currency forward contracts </div></td> <td> </td> <td align="left" valign="top">Other non-current assets/liabilities</td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.0</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">4.0</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="19" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total derivatives</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1.0</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.7</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>3.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">5.9</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="19" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following tables present the impact of derivative instruments and their location within the Consolidated Statements of Income: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Amount of gain or (loss) recognized</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>in income on derivative</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivatives in fair value hedging</b></td> <td> </td> <td nowrap="nowrap" align="left"><b>Location of gain or (loss)</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>December 31,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">December 31,</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>relationships</b></td> <td> </td> <td nowrap="nowrap" align="center"><b>recognized in income on derivative</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Interest rate swaps </div></td> <td> </td> <td align="left" valign="top">Interest expense</td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(1.3</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Natural gas forward contracts </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Other (expense) income, net</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.6</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(2.9</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Amount of gain or (loss) recognized in</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>income on derivative</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Hedged items in fair value hedge</b></td> <td> </td> <td nowrap="nowrap" align="left"><b>Location of gain or (loss)</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>December 31,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">December 31,</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>relationships</b></td> <td> </td> <td nowrap="nowrap" align="center"><b>recognized in income on derivative</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Fixed-rate debt </div></td> <td> </td> <td align="left" valign="top">Interest expense</td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">1.3</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Natural gas </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Other (expense) income, net</td> <td> </td> <td> </td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td> </td> <td align="right">1.2</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">2.5</td> <td> </td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">The following tables present the impact of derivative instruments and their location within the Consolidated Statements of Income: </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="52%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Amount of gain or </b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Amount of gain or </b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>(loss) reclassified from</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>(loss) recognized in</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b> AOCI into income</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b> OCI on derivative</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b> (effective portion)</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivatives in cash flow hedging</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>December 31,</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>December 31,</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>relationships</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #ffffff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency forward contracts </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1.9</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(3.3</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4.2</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">—</td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1.9</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(3.3</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="17" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 0pt"> <i> </i> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="64%"> </td> <td width="5%"> </td> <td width="7%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>Amount of gain or (loss)</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>recognized in income on</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7"><b>derivative</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>Derivatives not designated as</b></td> <td> </td> <td nowrap="nowrap" align="center"><b>Location of gain or (loss) recognized in</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000"><b>December 31,</b></td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left"><b>hedging instruments</b></td> <td> </td> <td nowrap="nowrap" align="center"><b>income on derivative</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"><b>2010</b></td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2009</td> </tr>   <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency forward contracts </div></td> <td> </td> <td align="left" valign="top">Cost of sales</td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>—</b></td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">0.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Foreign currency forward contracts </div></td> <td> </td> <td align="left" valign="top" nowrap="nowrap">Other (expense) income, net</td> <td> </td> <td> </td> <td align="right"><b>2.3</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.7</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Total</b> </div></td> <td> </td> <td align="left" valign="top"> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>2.3</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right">$</td> <td align="right">(0.6</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td colspan="11" align="left" style="border-top: 3px double #000000"> </td> </tr>  </table> </div> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 12pt"><i>Note 17 – Prior-Period Adjustments</i> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During the third quarter of 2010, the Company recorded an adjustment related to its 2009 Consolidated Financial Statements. (Loss) income from discontinued operations, net of income taxes, decreased $1.3 million (after-tax) due to a correction of an error related to a foreign currency translation adjustment for the Company’s Canadian operations that were sold as part of the NRB divestiture. The Company realized during the third quarter of 2010 that this adjustment should have been written-off in the fourth quarter of 2009 and recognized as part of the loss on the sale of the NRB operations. Management of the Company concluded the effect of the third quarter adjustment was immaterial to the Company’s 2009 and third-quarter 2010 financial statements, as well as to the full-year 2010 financial statements. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During the first quarter of 2010, the Company recorded a $14.1 million adjustment to other comprehensive income for deferred taxes on postretirement prescription drug benefits, specifically the employer subsidy provided by the U.S. government under the Medicare Part D program (the Medicare subsidy). The Company determined it had provided deferred taxes on postretirement benefit plan accruals recorded through other comprehensive income net of the Medicare subsidy, rather than on a gross basis. The cumulative impact of this error resulted in a cumulative understatement of deferred tax assets totaling $14.1 million and a corresponding overstatement of accumulated other comprehensive loss. Management concluded the effect of the adjustment was not material to the Company’s prior three fiscal years and the first quarter of 2010 financial statements, as well as the estimated full-year 2010 financial statements. </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">During the first quarter of 2009, the Company recorded two adjustments related to its 2008 Consolidated Financial Statements. Net income (loss) attributable to noncontrolling interest increased by $6.1 million (after-tax) due to a correction of an error related to the $18.4 million goodwill impairment loss the Company recorded in the fourth quarter of 2008 for the Mobile Industries segment. In recording this goodwill impairment loss, the Company did not recognize that a portion of the loss related to two separate subsidiaries in India and South Africa of which the Company holds less than 100% ownership. In addition, income (loss) from continuing operations before income taxes decreased by $3.4 million, or $0.04 per share, ($2.0 million after-tax or $0.02 per share) due to a correction of an error related to $3.4 million of in-process research and development costs that were recorded in other current assets with the anticipation of being paid for by a third-party. However, the Company subsequently realized that the balance could not be substantiated through a contract with a third party. The net effect of these errors understated 2008 net income attributable to The Timken Company of $267.7 million by $4.1 million. Furthermore, the net effect of these errors overstated the Company’s first quarter 2009 net income attributable to The Timken Company of $0.9 million by $4.1 million. Had these adjustments been recorded in the fourth quarter of 2008, rather than the first quarter of 2009, the results for the first quarter of 2009 would have been a net loss attributable to The Timken Company of $3.2 million. Management of the Company concluded the effect of the first quarter adjustments was immaterial to the Company’s 2008 and first-quarter 2009 financial statements, as well as to the full-year 2009 financial statements. </div>   </div>  <div style="font-family: Helvetica,Arial,sans-serif"> <div align="left" style="font-size: 10pt; margin-top: 6pt"><b>Quarterly Financial Data</b><br /> (Unaudited) </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000"><b>2010</b></td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">1st</td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">2nd</td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">3rd</td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">4th</td> <td style="border-bottom: 1px solid #000000"> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Total</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td align="left">(Dollars in millions, except per share data)</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net sales</b> </div></td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>913.7</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,011.4</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,059.7</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>1,070.7</b></td> <td> </td> <td> </td> <td align="right"><b>$</b></td> <td align="right"><b>4,055.5</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Gross profit</b> </div></td> <td> </td> <td> </td> <td align="right"><b>222.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>268.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>265.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>265.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1,021.7</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Impairment and restructuring charges (1)</b> </div></td> <td> </td> <td> </td> <td align="right"><b>5.5</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>1.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.9</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>12.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>21.7</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Income from continuing operations (2)</b> </div></td> <td> </td> <td> </td> <td align="right"><b>28.7</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>82.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>72.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>86.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>269.5</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td nowrap="nowrap"> <div style="margin-left:15px; text-indent:-15px"><b>Income (loss) from discontinued operations (3)</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>4.2</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(1.1</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right"><b>4.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>7.4</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net income</b> </div></td> <td> </td> <td> </td> <td align="right"><b>29.0</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>86.2</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>71.1</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>90.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>276.9</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net income attributable to noncontrolling interests</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.4</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.8</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.1</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net income attributable to The Timken Company</b> </div></td> <td> </td> <td> </td> <td align="right"><b>28.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>85.6</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>70.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>90.3</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>274.8</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net income per share — Basic:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Income from continuing operations</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.29</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.84</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.74</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.89</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.76</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Income (loss) from discontinued operations</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.01</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.04</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(0.01</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right"><b>0.04</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.07</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Total net income per share</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.30</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.88</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.73</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.93</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.83</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Net income per share — Diluted:</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Income from continuing operations</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.29</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.84</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.73</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.87</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.73</b></td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Income (loss) from discontinued operations</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.00</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.04</b></td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right"><b>(0.01</b></td> <td nowrap="nowrap"><b>)</b></td> <td> </td> <td> </td> <td align="right"><b>0.04</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.08</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px"><b>Total net income per share</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.29</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.88</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.72</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.91</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>2.81</b></td> <td> </td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Dividends per share</b> </div></td> <td> </td> <td> </td> <td align="right"><b>0.09</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.13</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.13</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.18</b></td> <td> </td> <td> </td> <td> </td> <td align="right"><b>0.53</b></td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr>  </table> </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> <td width="5%"> </td> <td width="3%"> </td> <td width="1%"> </td> <td width="3%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="left">2009</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">1st</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">2nd</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">3rd</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">4th</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Total</td> </tr>   <tr style="font-size: 1px"> <td colspan="21" align="left" style="border-top: 1px solid #000000"> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net sales </div></td> <td> </td> <td align="right">$</td> <td align="right">866.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">736.8</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">763.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">774.6</td> <td> </td> <td> </td> <td align="right">$</td> <td align="right">3,141.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Gross profit </div></td> <td> </td> <td> </td> <td align="right">154.6</td> <td> </td> <td> </td> <td> </td> <td align="right">125.4</td> <td> </td> <td> </td> <td> </td> <td align="right">129.5</td> <td> </td> <td> </td> <td> </td> <td align="right">173.2</td> <td> </td> <td> </td> <td> </td> <td align="right">582.7</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Impairment and restructuring charges (4) </div></td> <td> </td> <td> </td> <td align="right">13.8</td> <td> </td> <td> </td> <td> </td> <td align="right">50.7</td> <td> </td> <td> </td> <td> </td> <td align="right">19.6</td> <td> </td> <td> </td> <td> </td> <td align="right">80.0</td> <td> </td> <td> </td> <td> </td> <td align="right">164.1</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Loss from continuing operations </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.4</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(38.4</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(19.0</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(7.2</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(66.0</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Loss from discontinued operations (3) </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(3.6</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(25.5</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(30.8</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(12.7</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(72.6</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net loss (5) </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(5.0</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(63.9</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(49.8</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(19.9</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(138.6</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net (loss) income attributable to noncontrolling interests (6) </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(5.9</td> <td nowrap="nowrap">)</td> <td> </td> <td> </td> <td align="right">0.6</td> <td> </td> <td> </td> <td> </td> <td align="right">0.4</td> <td> </td> <td> </td> <td> </td> <td align="right">0.3</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(4.6</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Net (loss) income attributable to The Timken Company (7) </div></td> <td> </td> <td> </td> <td align="right">0.9</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(64.5</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(50.2</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(20.2</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(134.0</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net (loss) income per share — Basic: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">(Loss) income from continuing operations </div></td> <td> </td> <td> </td> <td align="right">0.05</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.40</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.20</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.08</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.64</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">(Loss) income from discontinued operations </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.04</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.27</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.32</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.13</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.75</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" nowrap="nowrap" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:45px; text-indent:-15px">Total net (loss) income per share </div></td> <td> </td> <td> </td> <td align="right">0.01</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.67</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.52</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.21</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.39</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" nowrap="nowrap" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Net (loss) income per share — Diluted: </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">(Loss) income from continuing operations </div></td> <td> </td> <td> </td> <td align="right">0.05</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.40</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.20</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.08</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.64</td> <td nowrap="nowrap">)</td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:30px; text-indent:-15px">Loss from discontinued operations </div></td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.04</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.27</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.32</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.13</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.75</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" nowrap="nowrap" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:30px; text-indent:-15px">Total net (loss) income per share </div></td> <td> </td> <td> </td> <td align="right">0.01</td> <td> </td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.67</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.52</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(0.21</td> <td nowrap="nowrap">)</td> <td> </td> <td nowrap="nowrap" align="right"> </td> <td align="right">(1.39</td> <td nowrap="nowrap">)</td> </tr> <tr style="font-size: 1px"> <td> </td> <td> </td> <td colspan="19" nowrap="nowrap" align="left" style="border-top: 1px solid #000000">         </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Dividends per share </div></td> <td> </td> <td> </td> <td align="right">0.18</td> <td> </td> <td> </td> <td> </td> <td align="right">0.09</td> <td> </td> <td> </td> <td> </td> <td align="right">0.09</td> <td> </td> <td> </td> <td> </td> <td align="right">0.09</td> <td> </td> <td> </td> <td> </td> <td align="right">0.45</td> <td> </td> </tr>  </table> </div> <div align="left" style="font-size: 10pt; margin-top: 6pt">Earnings per share are computed independently for each of the quarters presented; therefore, the sum of the quarterly earnings per share may not equal the total computed for the year. </div> <div align="left"> <div style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">  </div> </div> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left"> <tr> <td width="3%"></td> <td width="1%"></td> <td width="96%"></td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(1)</td> <td> </td> <td>Impairment and restructuring charges for the first quarter of 2010 include severance and related benefit costs of $5.0 million and exit costs of $0.5 million. Impairment and restructuring charges for the fourth quarter of 2010 include exit costs of $8.2 million, impairment charges of $2.7 million and severance and related benefit costs of $1.4 million.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(2)</td> <td> </td> <td>Income from continuing operations for the first quarter of 2010 includes a charge of $21.6 million to record the deferred tax impact of the Patient Protection and Affordable Care Act. Income from continuing operations for the fourth quarter of 2010 includes an income tax benefit of $19.8 related to contributions to a VEBA trust.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(3)</td> <td> </td> <td>Discontinued operations for 2010 reflects the gain on the sale of NRB, net of tax. Discontinued operations for 2009 reflects the operating results and loss on sale of NRB, net of tax.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(4)</td> <td> </td> <td>Impairment and restructuring charges for the second quarter of 2009 include fixed asset impairments of $31.1 million, severance and related benefit costs of $18.1 million and exit costs of $1.5 million. Impairment and restructuring charges for the fourth quarter of 2009 include fixed asset impairments of $72.8 million, severance and related benefit costs of $6.5 million and exit costs of $0.8 million.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(5)</td> <td> </td> <td>Loss from continuing operations and net loss for the first quarter of 2009 include a prior-period adjustment of $2.0 million after-tax for a correction of an error related to in-process research and development costs that were recorded in other current assets in the Company’s 2008 Consolidated Financial Statements. Had this adjustment been properly recorded in the fourth quarter of 2008, the first quarter 2009 income from continuing operations would have been $0.6 million and the first quarter 2009 net loss would have been $3.1 million. See Note 17 — Prior-Period Adjustments in the Notes to the Consolidated Financial Statements for additional discussion.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(6)</td> <td> </td> <td>Net loss (income) attributable to noncontrolling interests for the first quarter of 2009 includes a prior-period adjustment of $6.1 million after-tax related to an error associated with the $18.9 million goodwill impairment loss the Company recorded in the fourth quarter of 2008 for the Mobile Industries segment. Had this adjustment been properly recorded in the fourth quarter of 2008, net income attributable to noncontrolling interests for the first quarter of 2009 would have been $0.2 million. See Note 17 — Prior-Period Adjustments in the Notes to the Consolidated Financial Statements for additional discussion.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(7)</td> <td> </td> <td>Net income attributable to The Timken Company of $0.9 million for the first quarter of 2009 includes two prior-period adjustments totalling $4.1 million related to the fourth quarter of 2008. Had these adjustments been properly recorded in the fourth quarter of 2008, rather than the first quarter of 2009, the results for the first quarter of 2009 would have been a net loss attributable to The Timken Company of $3.2 million or a loss of $0.03 per share and the results for the fourth quarter of 2008 would have been a net loss attributable to The Timken Company of $32.1 million or a loss of $0.33 per share. See Note 17 — Prior-Period Adjustments in the Notes to the Consolidated Financial Statements for additional discussion.</td> </tr> </table> </div>

<div style="font-family: Helvetica,Arial,sans-serif"> <div style="display: none"></div> <div style="display: none">Valuation and Qualifying Accounts </div> <div align="center" style="font-size: 10pt; margin-top: 18pt">Schedule II—Valuation and Qualifying Accounts </div> <div align="center" style="font-size: 10pt; margin-top: 6pt">The Timken Company and Subsidiaries </div> <div align="center"> <table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">  <tr valign="bottom"> <td width="40%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> <td width="5%"> </td> <td width="1%"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="center" style="border-bottom: 0px solid #000000">COL. A</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 0px solid #000000">COL. B</td> <td> </td> <td nowrap="nowrap" align="center" colspan="7">COL. C</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 0px solid #000000">Col. D</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 0px solid #000000">COL. E</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="7" style="border-bottom: 1px solid #000000">Additions</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3"> </td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Balance at</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Charged to</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Charged</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Balance at</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Beginning of</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">Costs and</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">to Other</td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td nowrap="nowrap" align="center" colspan="3">End of</td> </tr> <tr style="font-size: 8pt" valign="bottom"> <td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000">Description</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Period</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Expenses</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Accounts—</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Deductions —</td> <td> </td> <td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000">Period</td> </tr>   <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Allowance for uncollectible accounts</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2010 </div></td> <td> </td> <td align="right">$</td> <td align="right">41.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">16.5</td> <td nowrap="nowrap">(1)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1.2</td> <td nowrap="nowrap">)(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">29.3</td> <td nowrap="nowrap">(6)</td> <td> </td> <td align="right">$</td> <td align="right">27.6</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2009 </div></td> <td> </td> <td align="right">$</td> <td align="right">55.0</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">38.2</td> <td nowrap="nowrap">(1)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.5 </td> <td nowrap="nowrap">(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">52.1</td> <td nowrap="nowrap">(6)</td> <td> </td> <td align="right">$</td> <td align="right">41.6</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2008 </div></td> <td> </td> <td align="right">$</td> <td align="right">40.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">22.2</td> <td nowrap="nowrap">(1)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(0.8</td> <td nowrap="nowrap">)(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">7.1</td> <td nowrap="nowrap">(6)</td> <td> </td> <td align="right">$</td> <td align="right">55.0</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Allowance for surplus and obsolete inventory</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2010 </div></td> <td> </td> <td align="right">$</td> <td align="right">30.8</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">19.9</td> <td nowrap="nowrap">(2)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">0.4 </td> <td nowrap="nowrap">(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">20.3</td> <td nowrap="nowrap">(7)</td> <td> </td> <td align="right">$</td> <td align="right">30.8</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2009 </div></td> <td> </td> <td align="right">$</td> <td align="right">24.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">31.4</td> <td nowrap="nowrap">(2)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">1.7 </td> <td nowrap="nowrap">(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">27.0</td> <td nowrap="nowrap">(7)</td> <td> </td> <td align="right">$</td> <td align="right">30.8</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2008 </div></td> <td> </td> <td align="right">$</td> <td align="right">24.9</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">30.9</td> <td nowrap="nowrap">(2)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(1.4</td> <td nowrap="nowrap">)(4)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">29.7</td> <td nowrap="nowrap">(7)</td> <td> </td> <td align="right">$</td> <td align="right">24.7</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">  </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px"><b>Valuation allowance on deferred tax assets</b> </div></td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2010 </div></td> <td> </td> <td align="right">$</td> <td align="right">222.5</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">11.1</td> <td nowrap="nowrap">(3)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(11.9</td> <td nowrap="nowrap">)(5)</td> <td> </td> <td> </td> <td align="right">46.8</td> <td nowrap="nowrap">(8)</td> <td> </td> <td align="right">$</td> <td align="right">174.9</td> <td> </td> </tr> <tr valign="bottom" style="background: #cceeff"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2009 </div></td> <td> </td> <td align="right">$</td> <td align="right">159.6</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">57.8</td> <td nowrap="nowrap">(3)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">16.3 </td> <td nowrap="nowrap">(5)</td> <td> </td> <td> </td> <td align="right">11.2</td> <td nowrap="nowrap">(8)</td> <td> </td> <td align="right">$</td> <td align="right">222.5</td> <td> </td> </tr> <tr valign="bottom"> <td> <div style="margin-left:15px; text-indent:-15px">Year ended December 31, 2008 </div></td> <td> </td> <td align="right">$</td> <td align="right">186.7</td> <td> </td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">19.0</td> <td nowrap="nowrap">(3)</td> <td> </td> <td nowrap="nowrap" align="left"> </td> <td align="right">(21.7</td> <td nowrap="nowrap">)(5)</td> <td> </td> <td> </td> <td align="right">24.4</td> <td nowrap="nowrap">(8)</td> <td> </td> <td align="right">$</td> <td align="right">159.6</td> <td> </td> </tr>  </table> </div> <div align="left"> <div style="font-size: 3pt; margin-top: 16pt; width: 18%; border-top: 1px solid #000000">  </div> </div> <table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left"> <tr> <td width="3%"></td> <td width="1%"></td> <td width="96%"></td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(1)</td> <td> </td> <td>Provision for uncollectible accounts included in expenses.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(2)</td> <td> </td> <td>Provisions for surplus and obsolete inventory included in expenses.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(3)</td> <td> </td> <td>Increase in valuation allowance is recorded as a component of the provision for income taxes.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(4)</td> <td> </td> <td>Currency translation and change in reserves due to acquisitions, net of divestitures.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(5)</td> <td> </td> <td>Includes valuation allowances recorded against other comprehensive income/loss or goodwill.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(6)</td> <td> </td> <td>Actual accounts written off against the allowance — net of recoveries.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(7)</td> <td> </td> <td>Inventory items written off against the allowance.</td> </tr> <tr style="font-size: 3pt"> <td> </td> </tr> <tr valign="top"> <td nowrap="nowrap" align="left">(8)</td> <td> </td> <td>Amount primarily relates to the reversal of valuation allowances due to the realization of net operating loss carryforwards.</td> </tr> </table> </div>

false --12-31 FY 2010 2010-12-31 10-K 0000098362 97888273 Yes Large Accelerated Filer 2269831634 TIMKEN CO No Yes 225000000 0 0 225000000 0 0 1600000 1600000 1000000 1000000 11800000 11300000 9100000 3600000 2000000 649200000 513500000

156000000

263500000

411200000

516600000

-717100000

-624700000

843400000

881700000

16800000

14900000

16900000

4500000

100000

5700000

41600000

27600000

20100000

113700000

4700000

4006900000

4180400000

2022500000

2399200000

800000

42900000

133400000

755500000

877100000

90500000

622100000

121600000

1200000

-13500000

-2400000

76700000

-12400000

7400000

0.7

0.45

0.53

0.70

0.45

0.53

200000000

97034033

98153317

53100000

-277100000

-36100000

369200000

-3500000

-2500000

-1000000

3888900000

2558900000

3033800000

1900000

22800000

58800000

61500000

100400000

248600000

121500000

9200000

700000

6100000

6000000

690900000

394500000

200800000

201500000

189700000

-67500000

-43200000

-51300000

2.78

-1.39

2.83

2.77

-1.39

2.81

-20500000

18200000

-5300000

142500000

233400000

15200000

-6800000

-6500000

221700000

224400000

1151900000

582700000

1021700000

279000000

-61400000

267400000

439600000

-94200000

405500000

282600000

-66000000

269500000

2.90

-0.64

2.76

2.89

-0.64

2.73

-11300000

-72600000

7400000

-0.12

-0.75

0.07

-0.12

-0.75

0.08

157000000

-28200000

136000000

-57900000

-156100000

173600000

-107600000

-174500000

104800000

35700000

-48600000

97200000

97700000

-356100000

150000000

8000000

2700000

12900000

132100000

129200000

44400000

41900000

38200000

671200000

828500000

5800000

1900000

3700000

4006900000

4180400000

540400000

719900000

1870900000

1518700000

17100000

9600000

469300000

481700000

18000000

16800000

-1700000

-1100000

-700000

-145900000

-178000000

-32900000

-320700000

194200000

-152900000

-307200000

196600000

-152900000

577600000

587700000

312700000

500900000

600100000

305300000

267700000

-134000000

274800000

3600000

-4600000

2100000

462000000

-54100000

436200000

111300000

65300000

46800000

38400000

-397600000

62000000

-100000

62100000

98500000

98600000

-100000

232700000

64600000

22100000

-1100000

700000

-800000

-149900000

39800000

-5200000

100000

200000

-200000

189300000

176300000

100400000

105300000

7100000

-3700000

1800000

604200000

531200000

-500000

-4900000

1400000

29200000

67500000

43200000

51300000

10800000

86000000

400000

22600000

15000000

258100000

114100000

115800000

70500000

113500000

337000000

84700000

96700000

93100000

10000000

303600000

16900000

900000

50400000

810400000

255000000

18200000

-3500000

-21600000

-74200000

-3800000

36400000

2600000

1900000

271300000

267700000

3600000

-138600000

-4600000

-134000000

276900000

2100000

274800000

1335200000

1267700000

884100000

305700000

13700000

32800000

164100000

21700000

1402900000

1626400000

5040800000

3141600000

4055500000

657100000

472700000

563800000

16800000

14900000

16900000

26300000

22400000

1577600000

1925000000

1980000000

-10800000

53100000

19300000

1379900000

-271300000

809800000

1663000000

-819700000

1580100000

838300000

22800000

-11600000

53100000

1595600000

-4700000

-717100000

18000000

53100000

843400000

1402900000

1941800000

1626400000

-11500000

16800000

-624700000

53100000

881700000

747887

142531

1119284

9843

164985

170238

12400000

800000

17500000

-6000000

-800000

-5200000

-3800000

-10700000

6900000

-7600000

-6800000

-800000

14000000

179963

350201

4700000

11500000