Note 9 Restructuring and Relocation Activities

Consolidation of Restructuring Programs

As reported in our 2015 Form 10-K, our December 2011 Integration and Optimization Program (“IOP”) is substantially complete and is not expected to significantly impact 2016. The May 2013 Earnings Quality Improvement Program (“EQIP”) and the December 2014 Fusion program will show significant activity in 2016.

In the first quarter of 2016, the Board of Directors agreed to consolidate the remaining activities of all restructuring programs to create a single program to be called the “Sealed Air Restructuring Program” or the “Program.”

Program metrics are as follows:

Program	EQIP		Fusion		Total
Announcement Date	May 2013		December 2014
Status	Estimated to be completed by 12/31/2016		Estimated to be completed by 12/31/2018
Approximate positions eliminated by the program		900		1,050		1,950
Estimated Program Costs (in millions):
Costs of reduction in headcount as a result of reorganization	$130		$105-$110		$235-$240
Other expenses associated with the plan	50-55		110-115		160-170
Total expense	$180-185		$215-225		$395-410
Capital expenditures	45		205-210		250-255
Proceeds, foreign exchange and other cash items	(5) -(10)		(60)-(65)		(65)-(75)
Total estimated net cash cost	$220		$360-$370		$580-$590
Program to Date Cumulative Expense (in millions):
Costs of reduction in headcount as a result of reorganization	$	130	$	83	$	213
Other expenses associated with the plan		48		36		84
Total Cumulative Expense	$	178	$	119	$	297
Capital expenditures	$	45	$	64	$	109

The following table details our restructuring activities as reflected in the Condensed Statement of Operations for the three months ended March 31, 2016 and 2015:

	Three months ended March 31
(In millions)	2016		2015
Other associated costs	$	6.1	$	8.6
Restructuring charges		—		12.7
Total Expense	$	6.1	$	21.3
Capital Expenditures	$	19.1	$	2.4

The restructuring accrual, spending and other activity for the three months ended March 31, 2016 and the accrual balance remaining at March 31, 2016 related to these programs were as follows (in millions):

Restructuring accrual at December 31, 2015	$	76.3
Accrual and accrual adjustments		(0.2	)
Cash payments during 2016		(12.6	)
Effect of changes in foreign currency exchange rates		2.0
Restructuring accrual at March 31, 2016	$	65.5

We expect to pay $61 million of the accrual balance remaining at March 31, 2016 within the next twelve months. This amount is included in accrued restructuring costs on the Condensed Consolidated Balance Sheet at March 31, 2016. The remaining accrual of $4 million is expected to be paid in 2017. This amount is included in other non-current liabilities on our Condensed Consolidated Balance Sheet at March 31, 2016.

Fusion

The most substantial component of our Restructuring Program is the Fusion Program (“Fusion” or the “Plan”), which was approved by the Company’s Board of Directors on December 18, 2014 and consists of a portfolio of restructuring projects across all of our divisions as part of our transformation of Sealed Air into a knowledge-based company, including reduction in headcount and consolidation and relocation of certain facilities and offices.

Fusion includes that relocation of our global headquarters to Charlotte, North Carolina, including the headquarters for our divisions, research and development facilities, and corporate offices. By December 31, 2017, we anticipate approximately 1,300 jobs will have been relocated to Charlotte primarily from our former corporate headquarters in Elmwood Park, New Jersey; and facilities in Saddle Brook, New Jersey; Racine, Wisconsin; and, Duncan and Greenville, South Carolina. The cost of the Charlotte campus is estimated to be approximately $120 million.

In January, 2015, in connection with our relocation efforts, we closed on an agreement to sell our building located in Racine, Wisconsin. The final sales price was $30 million, of which net proceeds of $24 million were received as part of the closing along with a $6 million unsecured promissory note which was received in the third quarter of 2015. We recorded a pre-tax gain on the sale of approximately $3 million in the first quarter of 2015.

EQIP

In May 2013, we announced the commencement of EQIP, which is an initiative to deliver meaningful cost savings and network optimization. The costs associated with this plan consist primarily of a reduction in headcount and other costs associated with divisional realignment and connected profitability improvement programs and costs and capital expenditures associated with incremental supply chain network optimization projects, including facility relocation and closures. The plan is expected to be substantially completed by the end of 2016.