Document gkKn3z32X952QLMEgqr6qO4e

THIRD PARTY LIABILITY ANALYSIS OF UCC EXPOSURE . 1963 - 1977 -- EXPECT 2-3 SETTLEMENTS PER YEAR @ $60,000 EACH -- WITH 20 YEAR INCUBATION PERIOD, CLAIMS WOULD BEGIN IN 1983 . POST 1977 -- ASSUME CLAIMS DROP TO $40,000 PER YEAR TOTAL - RISK FACTOR -- FIGURE LIABILITY 50% HIGHER THAN ABOVE ESTIMATES . ESTIMATE OF UCC EXPOSURE -- CONTINUED OPERATION CASES -- $4 MM -- ABANDONMENT CASE -- $3.5 MM . UCC 008147 THIRD PARTY LIABILITY ANALYSIS OF UCC EXPOSURE . IMPACT ON STRATEGY RESULTS 1979-1988 IMPACT (ZERO LIABILITY) CASH FLOW $ MM EARNINGS $/SHARE AVERAGE ROA CONSTANT CAPACITY SHORT FIBER EXPANSION VISCOSITY CONTROL EXPANSION UNIT ABANDONMENT - SHUT DOWN - SELL 12.0 8.2 7.8 3.7 8.0 .152 .128 .144 (.017) .050 23 10 13 -- 1979-1988 IMPACT (ACCRUE FOR LIABILITY) CASH FLOW EARNINGS AVERAGE "... $ MM $/SHARE ROA CONSTANT CAPACITY SHORT FIBER EXPANSION VISCOSITY CONTROL EXPANSION UNIT ABAN. DONMENT - SHUT DOWN" - SELL * 9.9 6.1 5.7 1.9 6.2 .120 .096 .112 (.045) .022 18 8 10 -L UCC 008148 RECOMMENDED STRATEGY CONSTANT CAPACITY . HIGHEST EARNINGS QUALITY . LIMITED CAPITAL INVESTMENT . LOW RISK (POTENTIAL THIRD PARTY LIABILITY LARGELY RELATED TO PRE-'77 OPERATION) UCC 008149