19 ITEM 3. LEGAL PROCEEDINGS General Cable is subject to numerous federal, state, local and foreign laws and regulations relating to the storage, handling, emission and dischar ge of materials into the environment, including CERCLA, the Clean W ater Act, the Clean Air Act (including the 1990 amendments) and the Resource Conservation and Recovery Act. General Cable subsidiaries have been identified as potentially responsible parties with respect to several sites designated for cleanup under CERCLA or similar state laws, which impose liability for cleanup of certain waste sites and for related natural resource damages without regard to fault or the legality of waste generation or disposal. General Cable does not own or operate any of the waste sites with respect to which it has been named as a potentially responsible party by the government. Based on its review and other factors, management believes that costs relating to environmental clean-up at these sites will not have a material adverse ef fect on the Company’ s results of operations, cash flows or financial position. American Premier Underwriters, Inc., ("American Premier") in connection with the 1994 W assall PLC transaction, agreed to indemnify General Cable against liabilities (including all environmental liabilities) arising out of General Cable or its predecessors’ ownership or operation of the Indiana Steel & W ire Company and Marathon Manufacturing Holdings, Inc. businesses (which were divested by the predecessor prior to the 1994 W assall transaction), without limitation as to time or amount. American Premier also agreed to indemnify General Cable against 66 2/3 % of all other environmental liabilities arising out of General Cable or its predecessors’ ownership or operation of other properties and assets in excess of $10 million but not in excess of $33 million, which were identified during the seven-year period ended June 2001. Indemnifiable environmental liabilities through June 2001 were substantially below that threshold. In addition, General Cable also has claims against third parties with respect to some of these liabilities. While it is dif ficult to estimate future environmental liabilities accurately , the Company does not currently anticipate any material adverse ef fect on the results of operations, financial condition or cash flows as a result of compliance with federal, state, local or foreign environmental laws or regulations or cleanup costs of the sites discussed above. As part of the acquisition of Silec Cable, S.A.S (“Silec”), which was acquired in December 2005, SAFRAN SA ("SAFRAN") agreed to indemnify the Company for the full amount of losses arising from, related to or attributable to practices, if any , that are similar to previous practices investigated by the French competition authority for alleged competition law violations related to medium-and high-voltage cable markets. The Company has asserted a claim under this indemnity against SAFRAN related to the European Commission's Statement of Objections, to preserve our rights should an unfavorable outcome occur . The Company's subsidiaries have been named as defendants in lawsuits alleging exposure to asbestos in products manufactured by the Company . As of December 31, 2012 , General Cable was a defendant in approximately 29,089 cases brought in Federal District Courts throughout the United States. In calendar years 2012 , 201 1 and 2010 , 1 13 , 1 15 , and 95 asbestos cases, respectively , were brought against the Company . In the last 20 years, General Cable has had no cases proceed to verdict. In many of the cases, General Cable was dismissed as a defendant before trial for lack of product identification. As of December 31, 2012 , 21,868 asbestos cases have been dismissed. In calendar years 2012 , 201 1 and 2010 , 66 cases, 61 cases and 5,491 cases, respectively , were dismissed. W ith regards to the approximately 29,089 remaining pending cases, General Cable is aggressively defending these cases based upon either lack of product identification as to General Cable manufactured asbestos-containing product and/ or lack of exposure to asbestos dust from the use of General Cable product. For cases outside the Multidistrict Litigation (“MDL”) as of December 31, 2012 , Plaintif fs have asserted monetary damages in 651 cases. In 179 of these cases, plaintif fs allege only damages in excess of some dollar amount (about $151 thousand per plaintif f); in these cases there are no claims for specific dollar amounts requested as to any defendant. In the 138 other cases pending in state and federal district courts (outside the MDL), plaintif fs seek approximately $388 million in damages from as many as 1 10 defendants. In one case, plaintif fs have asserted damages related to General Cable in the amount of $10 million . In addition, in relation to these 651 cases, there are claims of $220 million in punitive damages from all of the defendants. However , many of the plaintif fs in these cases allege non-malignant injuries. At December 31, 2012 and 201 1 , General Cable had accrued, on a gross basis, approximately $5.2 million and $5.1 million , respectively , and had recorded approximately $0.5 million and $0.6 million of insurance recoveries for these lawsuits, respectively . The net amount of $4.7 million and $4.5 million , as of December 31, 2012 and 201 1 , respectively , represents the Company's best estimate in order to cover resolution of current and future asbestos-related claims. The components of the asbestos litigation reserve are current and future asbestos-related claims. The significant assumptions are: (1) the number of cases per state, (2) an estimate of the judgment per case per state, (3) an estimate of the percentage of cases per state that would make it to trial and (4) the estimated total liability percentage, excluding insurance recoveries, per case judgment. Management's estimates are based on the Company's historical experience with asbestos related claims. The Company's current history of asbestos claims does not provide suf ficient and reasonable information to estimate a range of loss for potential future, unasserted asbestos claims because the number and the value of the alleged damages of such claims have not been consistent. As such, the Company does not believe a reasonably possible range can be estimated with respect to asbestos claims that may be filed in the future. T able of Contents