Rayovac 2008 Annual Report Download - page 14

Table of Contents
Index to Financial Statements
materials into the environment, the handling and disposal of solid and hazardous substances and wastes and the remediation of contamination associated with the
releases of hazardous substances at our facilities. We believe that compliance with the federal, state, local and foreign laws and regulations to which we are
subject will not have a material effect upon our capital expenditures, financial position, earnings or competitive position.
From time to time, we have been required to address the effect of historic activities on the environmental condition of our properties. We have not
conducted invasive testing at all facilities to identify all potential environmental liability risks. Given the age of our facilities and the nature of our operations, it
is possible that material liabilities may arise in the future in connection with our current or former facilities. If previously unknown contamination of property
underlying or in the vicinity of our manufacturing facilities is discovered, we could incur material unforeseen expenses, which could have a material adverse
effect on our financial condition, capital expenditures, earnings and competitive position. Although we are currently engaged in investigative or remedial projects
at some of our facilities, we do not expect that such projects, taking into account established accruals, will cause us to incur expenditures that are material to our
business or financial condition; however, it is possible that our future liability could be material.
We have been, and in the future may be, subject to proceedings related to our disposal of industrial and hazardous material at off-site disposal locations or
similar disposals made by other parties for which we are held responsible as a result of our relationships with such other parties. In the U.S., these proceedings
are under the Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 (“CERCLA”) or similar state laws that hold persons
who “arranged for” the disposal or treatment of such substances strictly liable for costs incurred in responding to the release or threatened release of hazardous
substances from such sites, regardless of fault or the lawfulness of the original disposal. Liability under CERCLA is typically joint and several, meaning that a
liable party may be responsible for all costs incurred in investigating and remediating contamination at a site. As a practical matter, liability at CERCLA sites is
shared by all of the viable responsible parties. We occasionally are identified by federal or state governmental agencies as being a potentially responsible party
for response actions contemplated at an off-site facility. At the existing sites where we have been notified of our status as a potentially responsible party, it is
either premature to determine whether our potential liability, if any, will be material or we do not believe that our liability, if any, will be material. We may be
named as a potentially responsible party under CERCLA or similar state laws for other sites not currently known to us, and the costs and liabilities associated
with these sites may be material.
It is difficult to quantify with certainty the potential financial impact of actions regarding expenditures for environmental matters, particularly remediation,
and future capital expenditures for environmental control equipment. Nevertheless, based upon the information currently available, we believe that our ultimate
liability arising from such environmental matters, taking into account established accruals of $4.2 million for estimated liabilities at September 30, 2008, should
not be material to our business or financial condition.
Electronic and electrical products that we sell in Europe, particularly products sold under the Remington brand name, VARTA battery chargers, certain
portable lighting and all of our batteries, are subject to regulation in European Union (“EU”) markets under three key EU directives. The first directive is the
Restriction of the Use of Hazardous Substances in Electrical and Electronic Equipment (“RoHS”) which took effect in EU member states beginning July 1, 2006.
RoHS prohibits companies from selling products which contain certain specified hazardous materials in EU member states. We believe that compliance with
RoHS will not have a material effect on our capital expenditures, financial position, earnings or competitive position. The second directive is entitled the Waste
of Electrical and Electronic Equipment (“WEEE”). WEEE makes producers or importers of particular classes of electrical goods financially responsible for
specified collection, recycling, treatment and disposal of past and future covered products. WEEE assigns levels of responsibility to companies doing business in
EU markets based on their relative market share. WEEE calls on each EU member state to enact enabling legislation to implement the directive. To comply with
WEEE requirements, we have partnered with other companies to create a comprehensive collection, treatment, disposal and recycling program. As EU member
states pass enabling legislation our compliance system should be sufficient to meet such requirements. Our current estimated
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Source: Spectrum Brands, Inc, 10-K, December 10, 2008