Exhibit 10(C)

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Carpenter Technology Corporation

PO Box 14662

Reading, PA 19612-4662

Tel: 610.208.2000

September 2, 2010

Via Hand Delivery

 

  Re: Employment as SVP – Global Operations

Dear David Strobel,

On behalf of Carpenter Technology Corporation (the “Company”), we are pleased to
confirm our promotional offer to you on the terms below stated.

 

Title and Reporting    You will serve as the Company’s SVP – Global Operations,
reporting directly to me. Effective Date    September 7, 2010 Annual Base Salary
   $250,000 Annual Bonus   

You will be eligible to participate in the Company’s Executive Bonus
Compensation Plan, or such successor arrangement (if any) as the Board may from
time to time establish. Your target annual bonus opportunity for the fiscal year
ending June 30, 2011 will be 80% of your annual base salary received during the
fiscal year. Zero to 200% of target will be earned based on achievement of
Return on Net Assets (RONA), Operating Income, Revenue, On-Time Delivery and
Safety performance objectives during the fiscal year ending June 30, 2011. The
relevant corporate performance objectives are determined by the Board or its
Human Resources Committee each fiscal year.

 

 

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Annual Equity Awards   

The Company generally makes equity awards to its senior executives annually. The
terms of those awards are determined by the Board or its Human Resources
Committee. You will receive the following equity incentives for fiscal year
2011:

 

1) A non-qualified stock option to purchase common stock of the Company with a
grant date fair value, as determined by the Company, equal to $37,500. This
award is in addition to 2,956 stock options previously received at the beginning
of the fiscal year. The number of stock options will be determined by using
Black-Scholes valuation, which is based on the strike price on the grant date.
The exercise price of this option will be the closing price of the Company’s
common stock on the grant date. This option will vest and become exercisable as
follows: 1/3 per year on each of the first, second and third anniversaries of
the grant date, subject in each case to your continued service through the
applicable vesting date.

 

The grant date for your stock option award will be the effective date of your
promotion. You will receive an award agreement setting forth the number of
options granted, the exercise price and vesting terms after your promotion date.

 

2) A one-year performance unit opportunity that, at target levels of
performance, will result in the grant of 3,005 units that convert to common
stock of the Company on a 1:1 basis. This is the total target level of units,
not in addition to the target units previously communicated at the beginning of
the fiscal year. Zero to 200% of these units will be earned based on the
achievement of Earnings Per Share (EPS) performance objectives during the fiscal
year ending June 30, 2011 and, to the extent earned, will vest as follows:  1/2
per year on each of June 30, 2012 and June 30, 2013, subject in each case to
your continued service through the applicable vesting date. The relevant
corporate performance objectives are determined by the Board or its Human
Resources Committee each fiscal year.

 

3) A three-year performance unit opportunity that, at target levels of
performance, will result in the grant of 3,434 shares of common stock of the
Company. This is the total target level of units, not in addition to the target
units previously communicated at the beginning of the fiscal year. Zero to 200%
of these units will be earned based on your continued service and the
achievement of Total Shareholder Return (TSR) performance objectives during the
three year period ending June 30, 2013. The shares subject to the award will
only be issued, if at all, once earned and will be fully vested upon issuance.
The relevant corporate performance objectives will be determined by the Board or
its Human Resources Committee each fiscal year.

 

 

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Employee Benefits   

You will continue to be eligible to participate in the employee benefit programs
applicable to our salaried employees generally. Under current programs, this
would include in your case $250,000 of Company-paid group term life insurance
and Accidental Death & Dismemberment, and an opportunity to purchase, at your
own cost, supplemental term life insurance coverage.1

 

In addition, you will continue participation in the Supplemental Retirement Plan
for Executives of Carpenter Technology, Corp.. As previously communicated,
accruals in that plan will cease on December 31, 2012. You will also continue to
participate in the Deferred Compensation Plan for Officers and Key Employees of
Carpenter Technology Corporation as well as the three excess benefit plans
maintained for certain Company employees whose qualified plan benefits are
curtailed by Internal Revenue Code (“Code”) limits.

 

The Company reserves the right to amend, modify or terminate all these plans and
programs at any time, in its discretion.

 

Except as herein provided, or as may be hereafter approved by the Board or its
Human Resources Committee, you will not be entitled to further compensation or
benefits.

 

Executive Severance

Plan

  

Your employment by the Company is “at will” and may be terminated by the Company
or by you at any time. However, if your employment terminates due to a
termination by the Company without “cause” or a resignation by you with “good
reason” (each, as defined in the attached Plan document), you will be entitled
to receive the severance benefits included in the Severance Pay Plan for
Executives of Carpenter Technology Corporation attached hereto as Exhibit A.

 

Change in Control

Severance

  

You will be entitled to severance benefits in the event of a change in control,
details of which will be provided to you in the coming weeks. For avoidance of
doubt, benefits under this section will be in lieu of, not in addition to, the
severance benefits described in the Severance Pay Plan for Executives of
Carpenter Technology Corporation.

 

Intellectual

Property,

Confidentiality and

Restrictive

Covenants

  

In your capacity as SVP – Global Operations, you will be exposed to the
Company’s most sensitive and proprietary information and technology, and will be
provided with access to the Company’s most valuable and carefully cultivated
business relationships. Accordingly, your employment is conditioned upon your
execution of the Intellectual Property, Confidentiality and Restrictive Covenant
Agreement attached hereto as Exhibit B.

 

 

Indemnification   

To address your right to indemnification for acts performed in your capacity as
an Officer, the Company will enter into an Indemnification Agreement with you
substantially in the form attached hereto as Exhibit C.

 

 

1

At present, the maximum supplemental term life insurance coverage available is
the lesser of (i) four times base salary or (ii) $2,000,000 less the basic
Company-paid coverage amount.

 

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Miscellaneous   

You represent and warrant that there are no restrictions, agreements or
understandings whatsoever that would prevent or make unlawful your execution of
this letter, that would be inconsistent or in conflict with this letter or your
obligations hereunder, or that would otherwise prevent, limit or impair your
ability to be employed by the Company.

 

Your ownership of or transactions in securities of the Company will be subject
to the Company’s insider trading policies and stock ownership guidelines from
time to time in effect.

 

Reimbursement by the Company of any expense will be subject to Company policies
and practices in effect from time to time and will be further subject to the
requirements of Treas. Reg. §§ 1.409A-3(i)(1)(iv)(A)(3), (4) and (5).

 

Any payment or transfer of property to you will be subject to tax withholding to
the extent required by applicable law.

 

This letter constitutes our entire agreement and understanding regarding the
matters addressed herein, and merges and supersedes all prior or contemporaneous
discussions, agreements, and understandings of every nature between us regarding
these matters.

 

This letter will be governed by, and enforced in accordance with, the laws of
the Commonwealth of Pennsylvania, without regard to the application of the
principles of conflicts of laws.

 

Congratulations on your new role.

 

Sincerely, CARPENTER TECHNOLOGY CORPORATION By:   /S/ WILLIAM A. WULFSOHN  
William A. Wulfsohn   President & CEO

Acknowledged and agreed to on

this 2nd day of September, 2010:

 

/S/ DAVID L. STROBEL David L. Strobel

 

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