Chairman's - FMC Corporation

ebounded significantly in 2009, exemplified by the S&P 500 index in the U.S. being up 26 percent. As a result
our U.S. Plan assets increased to $708.4 million at December 31, 2009. Our U.S. Plan assets comprise
approximately 93 percent of our total plan assets with the difference representing plan assets related to foreign
pension plans. We have reduced our expected return on our U.S. Plan assets from 8.75 percent in 2008 to 8.5
percent in 2009 and will maintain the 8.5 percent assumption in 2010. In developing the assumption for the longterm
rate of return on assets for our U.S. Plan, we take into consideration the technical analysis performed by our
outside actuaries, including historical market returns, information on the assumption for long-term real returns by
asset class, inflation assumptions, and expectations for standard deviation related to these best estimates. We also
consider the historical performance of our own plan’s trust, which has earned a compound annual rate of return
of approximately 9.71 percent over the last 20 years (which is in excess of comparable market indices for the
same period) as well as other factors. Given an actively managed investment portfolio, the expected annual rates
of return by asset class for our portfolio, using geometric averaging, and after being adjusted for an estimated
inflation rate of approximately 2.50 percent, is between 8.25 percent and 10.25 percent for equities, and between
4.75 percent and 6.0 percent for fixed-income investments, which generates a total expected portfolio return that
is in line with our assumptions for the rate of return on assets. Under The Pension Protection Act of 2006, we are
not required to make a minimum level of funding into the U.S. Plan during 2010, however, in order to reduce
future funding volatility we intend to contribute $80 million in 2010 versus $75 million contributed in 2009 and
$30 million contributed in 2008. We do not believe that the additional contribution will have a significant
negative impact on our current and future liquidity needs. However a continuation of the volatility of interest
rates and negative equity returns under current market conditions may require greater contributions to the Plan in
the future.
In April 2007, the Board of Directors authorized the repurchase of up to $250 million of our common stock.
In October 2008, the Board authorized the repurchase of up to an additional $250 million of our common stock.
Although the repurchase program does not include a specific timetable or price targets and may be suspended or
terminated at any time, we expect that the program will be accomplished over the next two years. Shares may be
purchased through open market or privately negotiated transactions at the discretion of management based on its
evaluation of market conditions and other factors. During the twelve months ended December 31, 2009, we
repurchased 684,681 shares under the publicly announced repurchase program for $35.0 million. The remaining
dollar value of shares that may yet be purchased under this program was $189.8 million at December 31, 2009.
We also reacquire shares from time to time from employees and non-employee directors to pay taxes owed in
connection with the vesting and exercise of awards under our equity compensation plans.
Commitments
We guarantee repayment of some of the borrowings of certain foreign affiliates accounted for using the
equity method. We also guarantee the repayment of a borrowing of a minority partner in a foreign affiliate that
we consolidate in our financial statements. As of December 31, 2009 and 2008, these guarantees had maximum
potential payments of $5.8 million and $6.8 million, respectively.
We also provide guarantees to financial institutions on behalf of certain Agricultural Product customers,
principally in Brazil, for their seasonal borrowing. The total of these guarantees was $49.5 million and $20.3
million at December 31, 2009 and 2008, respectively, and are recorded on the consolidated balance sheets for
each date as “Guarantees of vendor financing”.
Short-term debt consisted of foreign credit lines at December 31, 2009 and 2008. We provide parentcompany
guarantees to lending institutions providing credit to our foreign subsidiaries.
In connection with our property and asset sales and divestitures, we have agreed to indemnify the buyer for
certain liabilities, including environmental contamination and taxes that occurred prior to the date of sale. Our
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