UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

COMMISSIONERS: Robert Pitofsky, Chairman

Sheila F. Anthony

Mozelle W. Thompson

Orson Swindle

Thomas B. Leary

In the Matter of

MACDERMID, INCORPORATED,

 a corporation,

 and

POLYFIBRON TECHNOLOGIES, INC., 

 a corporation.

Docket No. C-3911

ORDER TO MAINTAIN ASSETS

The Federal Trade Commission having initiated an investigation of the proposed

acquisition by the Respondent MacDermid, Incorporated of the Respondent Polyfibron

Technologies, Inc., hereinafter referred to as “Respondents,” and the Respondents having been

furnished thereafter with a copy of a draft of the Complaint that the Bureau of Competition

presented to the Commission for its consideration and which, if issued by the Commission, would

charge the Respondents with violations of Section 7 of the Clayton Act, as amended, 15 U.S.C. §

18, and Section 5 of the Federal Trade Commission Act, as amended, 15 U.S.C. § 45; and

Respondents, their attorneys, and counsel for the Commission having thereafter executed

an Agreement Containing Consent Orders (“Consent Agreement”), containing an admission by

the Respondents of all of the jurisdictional facts set forth in the aforesaid draft of the Complaint, a

statement that the signing of said Consent Agreement is for settlement purposes only and does not

constitute an admission by the Respondents that the law has been violated as alleged in such

Complaint, or that the facts as alleged in such Complaint, other than the jurisdictional facts, are

true, and waivers and other provisions as required by the Commission’s Rules; and

The Commission having thereafter considered the matter and having determined that it has

reason to believe that Respondents have violated the said Acts, and that a Complaint should issue
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stating its charges in that respect, and having determined to accept the executed Agreement

Containing Consent Orders and to place such Agreement on the public record for a period of

thirty (30) days, the Commission hereby issues its Complaint, makes the following jurisdictional

findings and issues this Order to Maintain Assets:

1. MacDermid is a corporation organized, existing and doing business under and by virtue of

the laws of the State of Connecticut, with its executive offices located at 245 Freight

Street, Waterbury, Connecticut 06702.

2. Polyfibron is a corporation organized, existing and doing business under and by virtue of

the laws of the State of Delaware, with its office and principal place of business located at

900 Middlesex Turnpike, Building 2, Billerica, Massachusetts 01821-3946.

3. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding

and of Respondents, and the proceeding is in the public interest.

ORDER

I.

IT IS ORDERED that, as used in this Order to Maintain Assets, the following definitions

shall apply:

A. “MacDermid” means MacDermid, Incorporated, its directors, officers, employees,

agents and representatives, predecessors, successors, and assigns; its joint

ventures, subsidiaries, divisions, groups, and affiliates controlled by MacDermid,

Incorporated, and the respective directors, officers, employees, agents,

representatives, successors, and assigns of each.

B. “Polyfibron” means Polyfibron Technologies, Inc., its directors, officers,

employees, agents and representatives, predecessors, successors, and assigns; its

joint ventures, subsidiaries, divisions, groups, and affiliates controlled by

Polyfibron Technologies, Inc., and the respective directors, officers, employees,

agents, representatives, successors, and assigns of each.

C. “Commission” means the Federal Trade Commission.

D. “Acquisition” means MacDermid’s proposed acquisition of the common stock of

Polyfibron pursuant to the Plan and Agreement of Merger dated February 18,

1999, as amended on July 27, 1999; September 23, 1999; and October 29, 1999.

E. “Assets To Be Divested” means:
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1. all rights, title, and interest in all equipment, machinery, tools, furniture and

other tangible property listed in Schedule A to the related Decision and

Order and any additional equipment, machinery, tools, furniture and other

tangible property, identified by the Commission-approved acquirer within

six months of the date of closing as set forth in the agreement to transfer

such assets to the Commission-approved acquirer, listed in Schedule B to

the related Decision and Order;

2. all rights, title, and interest in and to Patents relating to the research,

design, development, manufacture, distribution, marketing, or sale of

Polyfibron Liquid Photopolymer Products in North America, including, but

not limited to, those patents listed in Schedule C to the related Decision

and Order, provided that Respondents may negotiate licenses from the

Commission-approved acquirer to enable Respondents to operate the

Polyfibron Sheet Photopolymer Business and the Polyfibron International

Liquid Photopolymer Business;

3. all rights, titles, and interest in and to Intellectual Property, other than

Patents, relating to the research, design, development, manufacture,

distribution, marketing, or sale of Polyfibron Liquid Photopolymer

Products in North America, provided that Respondents may retain a nonexclusive right to such of the foregoing Intellectual Property as may be

required to operate and for the purposes of operating the Polyfibron Sheet

Photopolymer Business and the Polyfibron International Liquid

Photopolymer Business;

4. all rights, title, and interest in and to inventories of products, raw materials

(to the extent requested by the Commission-approved acquirer), supplies

and parts, including work-in-process and finished goods, relating to the

research, design, manufacture, development, marketing, or sale of

Polyfibron Liquid Photopolymer Products in North America, listed and

described in Schedule D to the related Decision and Order;

5. all rights, title, and interest in and to agreements, express or implied,

relating to the research, design, development, manufacture, distribution,

marketing, or sale of Polyfibron Liquid Photopolymer Products in North

America, regardless of whether such agreements relate exclusively to such

purposes, including, but not limited to, warranties, guarantees, and

contracts with joint venture partners, suppliers, including plate-making

equipment suppliers, personal property lessors, personal property lessees,

licensors, licensees, consignors, consignees, and customers; provided that

Respondents may retain a non-exclusive right to such agreements as may
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be required to operate and for the purposes of operating the Polyfibron

Sheet Photopolymer Business and the Polyfibron International Liquid

Photopolymer Business;

6. all rights, title and interest in and to Permits and Approvals relating to the

research, design, development, manufacture, distribution, marketing, or

sale of Polyfibron Liquid Photopolymer Products in North America,

regardless of whether such Permits and Approvals relate exclusively to

such purposes, to the extent such Permits and Approvals are transferrable;

and

7. all customer and vendor lists, catalogs, sales promotion literature and

advertising materials relating to the research, design, development,

manufacture, distribution, marketing, or sale of Polyfibron Liquid

Photopolymer Products in North America.

provided, however, the Assets To Be Divested do not include those assets of

Polyfibron that relate exclusively to the Polyfibron Sheet Photopolymer Business

or the Polyfibron International Liquid Photopolymer Business.

F. “Capability to Manufacture the Polyfibron Liquid Photopolymer Resins” means the

ability of the Commission-approved acquirer to manufacture each of the Polyfibron

Liquid Photopolymer Resins manufactured by Polyfibron since January 1, 1999

used to produce printing plates for the printing of packaging materials to

specifications identical to the Polyfibron Liquid Photopolymer Resins produced by

Polyfibron, which ability shall be determined using an infra red spectrometer and

verified by both Polyfibron and the Commission-approved acquirer, and that the

equipment, materials, tools, furniture and other tangible property listed in Schedule

A to the related Decision and Order have been relocated to the facilities of the

Commission-approved acquirer and are fully operational.

G. “Chemence” means Chemence Incorporated, a corporation organized, existing and

doing business under and by virtue of the laws of the State of Ohio, with its office

and principal place of business located at 185 Bluegrass Parkway, Alpharetta,

Georgia 30005.

H. “Liquid Photopolymers” means liquid photopolymer resins used to produce

printing plates for any printing application.

I. “Polyfibron International Liquid Photopolymer Business” means the business of

Polyfibron of researching, designing, developing, manufacturing, distributing,

marketing and selling: (1) liquid photopolymer printing plate products and

equipment for customers outside North America; and (2) liquid photopolymer
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printing plate products and equipment for publishing, including newspapers,

newspaper inserts, and books anywhere in the world. 

J. “Polyfibron Liquid Photopolymer Business” means the business of Polyfibron of

researching, designing, developing, manufacturing, distributing, marketing and

selling the Polyfibron Liquid Photopolymer Products.

K. “Polyfibron Liquid Photopolymer Products” means:

1. any liquid photopolymer resins used to produce printing plates,

2. any plate-backing and cover films used in conjunction with liquid

photopolymer resins in the production of photopolymer printing

plates,

3. any chemicals and related products used in conjunction with liquid

photopolymer resins in the production of photopolymer printing

plates, and

4. any equipment, agreements relating to equipment, or rights in or to

equipment, used to produce photopolymer printing plates from

liquid photopolymer resins,

that have been manufactured, distributed, leased or sold by Polyfibron, or have

been the subject of research or development by Polyfibron, in North America.

L. “Polyfibron Liquid Photopolymer Resins” means all of the kinds and types of liquid

photopolymer resins manufactured by Polyfibron used to produce photopolymer

printing plates.

M. “Polyfibron Sheet Photopolymer Business” means the business of Polyfibron of

researching, designing, developing, manufacturing, distributing, marketing and

selling solid sheet photopolymer printing plate products and equipment for any

printing applications anywhere in the world.
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II.

IT IS FURTHER ORDERED that:

A. The purpose of this order is: (i) to preserve the Polyfibron Liquid Photopolymer Business

as a viable, competitive, and ongoing business until the divestiture, as described in

Paragraphs II and III of the related Decision and Order, is achieved; (ii) to assure that no

material confidential information is exchanged between the respective liquid photopolymer

businesses of McDermid and Polyfibron; and (iii) to prevent interim harm to competition

pending divestiture and other relief. 

B. Respondents shall take such actions as are necessary to maintain the viability,

competitiveness, and marketability of the Polyfibron Liquid Photopolymer Business and

the Assets To Be Divested; shall not sell, transfer, or encumber the Assets To Be Divested

or other assets related to the Polyfibron Liquid Photopolymer Business other than to the

Commission-approved acquirer in accordance with Paragraph II.A. of the related Decision

and Order and the sale of parts and finished goods inventory in the ordinary course of

business; and shall not cause or permit the destruction, removal, wasting, or deterioration,

or otherwise impair the viability, competitiveness, or marketability of the Assets To Be

Divested or other assets related to the Polyfibron Liquid Photopolymer Business, except

for ordinary wear and tear. 

C. Respondents shall conduct or cause to be conducted the Polyfibron Liquid Photopolymer

Business in the regular and ordinary course and in accordance with past practice

(including regular repair and maintenance efforts) and shall use their best efforts to

preserve existing relationships with suppliers, customers, employees, and others having

business relations with the Polyfibron Liquid Photopolymer Business.

D. Prior to the physical transfer of the Assets To Be Divested used in the manufacture of

Polyfibron Liquid Photopolymer Products, Respondents shall ensure that a sufficient

inventory of Polyfibron Liquid Photopolymer Products is maintained and built up,

consistent with past and/or projected demand, so as to assure that no shortages of such

products occur at any time, including the period in which the manufacturing assets are

shut down for removal, physically transferred to the Commission-approved acquirer, and 

reassembled and capable of producing Polyfibron Liquid Photopolymer Products in

sufficient quantity and quality to satisfy demand for such products.

E. Respondents shall maintain a work force of equivalent size, training, and expertise

associated with the Polyfibron Liquid Photopolymer Business. Respondents shall, directly

or through agreement with Chemence or any other proposed acquirer, provide the

individuals identified in Schedule F of the related Decision and Order with financial

incentives to continue in their employment positions during the period covered by this

Order to Maintain Assets. Such incentives shall consist of:
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1. continuation of all employee benefits offered by Polyfibron until the divestiture is

completed; and

2. a bonus equal to ten (10) percent of the employee’s annual salary (including any

other bonuses) as of the date this Order to Maintain Assets is issued by the

Commission to those Polyfibron employees that continue their employment with

Polyfibron until the divestiture described in the related Decision and Order is

completed. Employees identified in Schedule E of the related Decision and Order,

or Schedule F if the Commission-approved acquirer is Chemence, that accept

employment with the Commission-approved acquirer are entitled to an additional

twenty (20) percent bonus under the terms specified in the Decision and Order.

F. Respondents shall not make offers to remain in Respondents’ employment after the

divestiture to the individuals listed in Schedule E or Schedule F of the related Decision and

Order,.

G. Respondents shall not interfere with the employment by the Commission-approved

acquirer of Polyfibron employees listed in Schedule E of the related Decision and Order,

or Schedule F of the related Decision and Order if the Commission-approved acquirer is

Chemence; shall not offer any incentive to such employees to decline employment with the

Commission-approved acquirer or to accept other employment with the Respondents; and

shall remove any impediments that may deter such employees from accepting employment

with the Commission-approved acquirer, including, but not limited to, any non-compete or

confidentiality provisions of employment or other contracts with the Respondents that

would affect the ability of those individuals to be employed by the Commission-approved

acquirer; provided that Respondents may continue to enforce such provisions with respect

to the Polyfibron International Liquid Photopolymer Business and the Polyfibron Sheet

Photopolymer Business.

H. At the time of execution of a purchase agreement with a Commission-approved acquirer,

Respondents shall provide the Commission-approved acquirer with a complete list of all

non-clerical employees who have been engaged in the research, design, development,

manufacture, distribution, marketing and sale of the Polyfibron Liquid Photopolymer

Products at any time during the period from January 1, 1999, until the date of such

purchase agreement (Schedule E of the related Decision and Order). Such list shall state

each such individual's name and position.

I. Respondents shall provide the Commission-approved acquirer the opportunity to enter

into employment contracts with the individuals listed in Schedule E of the related Decision

and Order, or Schedule F of the related Decision and Order if the Commission-approved

acquirer is Chemence.
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J. Except as required by law; except to the extent necessary information is exchanged in the

course of evaluating the Acquisition, defending investigations or litigation, obtaining legal

advice, negotiating agreements to divest assets, or complying with the related Decision

and Order or this Order to Maintain Assets; or except as necessary to operate the

Polyfibron International Liquid Photopolymer Business and the Polyfibron Sheet

Photopolymer Business, MacDermid shall not receive or have access to any competitively

sensitive or proprietary information, including, but not limited to, customer lists, price

lists, marketing methods, patents, technologies, processes or other trade secrets, not

independently known to MacDermid from sources other than Polyfibron and that relate to

the Assets To Be Divested. 

K. For a period of ninety (90) days from the date of the divestiture required by the related

Decision and Order, or until the Commission-approved acquirer has achieved the

Capability to Manufacture the Polyfibron Liquid Photopolymer Resins, whichever is

earlier, Respondents shall not solicit, induce or attempt to solicit or induce the Liquid

Photopolymer business of any customer or client of the Commission-approved acquirer,

including Liquid Photopolymer customers or clients of Polyfibron and customers or clients

of distributors that have purchased Polyfibron Liquid Photopolymer Products, provided,

however, that nothing in this paragraph shall be interpreted as restricting Respondents

from (a) providing any product or service to any customer of the Commission-approved

acquirer that solicits such purchases from Respondents; (b) engaging in general price

reductions, increasing their general level of rebates, or improving generally the level of

quality or service with respect to any products; (c) general advertising or engaging in

general promotion of any product consistent with their prior business practice; or (d)

continuing to solicit customers of the Polyfibron International Liquid Photopolymer

Business or the Polyfibron Sheet Photopolymer Business. 

III.

IT IS FURTHER ORDERED that Respondents shall notify the Commission at least

thirty (30) days prior to any proposed change in Respondents, such as dissolution, assignment,

sale resulting in the emergence of a successor corporation, or the creation or dissolution of

subsidiaries or any other change in the corporation, that may affect compliance obligations arising

out of this Order to Maintain Assets.

IV.

IT IS FURTHER ORDERED that for the purposes of determining or securing

compliance with this Order to Maintain Assets, and subject to any legally recognized privilege,

and upon written request with reasonable notice to Respondents made to their principal United

States offices, Respondents shall permit any duly authorized representatives of the Commission:
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A. Access, during office hours of Respondents and in the presence of counsel, to all facilities,

and access to inspect and copy all books, ledgers, accounts, correspondence, memoranda,

and all other records and documents in the possession or under the control of the

Respondents relating to compliance with this Order to Maintain Assets; and

B. Upon five (5) days' notice to Respondents and without restraint or interference from

Respondents, to interview officers, directors, or employees of Respondents, who may

have counsel present, regarding such matters.

V.

IT IS FURTHER ORDERED that this Order to Maintain Assets shall terminate on the

earlier of:

A. Three (3) business days after the Commission withdraws its acceptance of the

Consent Agreement pursuant to the provisions of Commission Rule 2.34, 16

C.F.R. § 2.34; or

B. The day after the divestiture, as described in and required by the related Decision

and Order, is completed.

By the Commission.

Donald S. Clark

Secretary

SEAL

ISSUED: December 21, 1999