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1110207

UNITED STATES OF AMERICA

BEFORE FEDERAL TRADE COMMISSION

COMMISSIONERS: Jon Leibowitz, Chairman

J. Thomas Rosch

Edith Ramirez

Julie Brill

Maureen K. Ohlhausen

 

)

In the Matter of )

)

CARPENTER TECHNOLOGY CORPORATION ) Docket No. C-4349 

a corporation; )

)

and )

)

LATROBE SPECIALTY METALS, INC. )

a corporation. )

 )

DECISION AND ORDER

[Redacted Public Version]

The Federal Trade Commission (“Commission”), having initiated an investigation of the

proposed acquisition by Respondent Carpenter Technology Corporation (“Carpenter”) of 100

percent of the outstanding voting securities of Respondent Latrobe Specialty Metals, Inc.

(“Latrobe”) from HHEP-Latrobe, L.P., and Respondents having been furnished thereafter with a

copy of a draft of Complaint that the Bureau of Competition proposed to present to the

Commission for its consideration and that, if issued by the Commission, would charge

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

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

statement that the signing of said Consent Agreement is for settlement purposes only and does

not constitute an admission by Respondents that the law has been violated as alleged in such

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

and waivers and other provisions as required by the Commission’s Rules; and
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The Commission having thereafter considered the matter and having determined that it

had reason to believe that Respondents have violated the said Acts, and that a Complaint should

issue stating its charges in that respect, and having thereupon issued its Complaint and an Order

to Maintain Assets, and having accepted the executed Consent Agreement and placed such

Consent Agreement on the public record for a period of thirty (30) days for the receipt and

consideration of public comments, now in further conformity with the procedure described in

Commission Rule 2.34, 16 C.F.R. § 2.34, the Commission hereby makes the following

jurisdictional findings and issues the following Decision and Order ("Order"):

1. Respondent Carpenter Technology Corporation is a corporation organized,

existing and doing business under and by virtue of the laws of State of Delaware,

with its headquarters address located at 101 West Bern Street, Reading,

Pennsylvania 19601.

2. Respondent Latrobe Specialty Metals, Inc. is a corporation organized, existing

and doing business under and by virtue of the laws of the State of Delaware, with

its headquarters address at 2626 Ligonier Street, Latrobe, Pennsylvania 15650. 

HHEP-Latrobe, L.P., the ultimate parent entity of Latrobe Specialty Metals, Inc.,

has its headquarters address at 100 Crescent Court, Suite 1200, Dallas, Texas

75201.

3. The 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 the Order, the following definitions shall apply:

A. “Carpenter” means Carpenter Technology Corporation, its directors, officers, employees,

agents, representatives, successors, and assigns; and its joint ventures, subsidiaries,

divisions, groups and affiliates in each case controlled by Carpenter (including, but not

limited to, Hawke Acquisition Corp.) and the respective directors, officers, employees,

agents, representatives, successors, and assigns of each. After the Acquisition, Carpenter

shall include Latrobe.

B. “Latrobe” means Latrobe Specialty Metals, Inc., its directors, officers, employees, agents,

representatives, successors, and assigns; and its joint ventures, subsidiaries, divisions,

groups and affiliates in each case controlled by Latrobe, and the respective directors,

officers, employees, agents, representatives, successors, and assigns of each. “Latrobe” also

includes HHEP-Latrobe, L.P., the ultimate parent entity of Latrobe Specialty Metals, Inc. 

C. “Respondents” mean Carpenter and Latrobe, individually and collectively.
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D. “Commission” means the Federal Trade Commission.

E. “Acquirer” means the following: 

1. a Person specified by name in this Order to acquire particular assets or rights that

Respondents are required to assign, grant, license, divest, transfer, deliver, or otherwise

convey pursuant to this Order and that has been approved by the Commission to

accomplish the requirements of this Order in connection with the Commission’s

determination to make this Order final and effective; or 

2. a Person approved by the Commission to acquire particular assets or rights that

Respondents are required to assign, grant, license, divest, transfer, deliver, or otherwise

convey pursuant to this Order.

F. “Acquisition” means Respondent Carpenter’s acquisition of fifty percent (50%) or more of

the voting securities of Respondent Latrobe. The Acquisition is contemplated by the

Agreement and Plan of Merger, as amended, by and among Latrobe Specialty Metals, Inc.,

Carpenter Technology Corporation, Hawke Acquisition Corp., HHEP-Latrobe, L.P., and

Watermill-Toolrock Partners, L.P. dated as of June 20, 2011, submitted to the Commission,

pursuant to which Carpenter plans to acquire 100% of the outstanding voting securities of

Latrobe from HHEP-Latrobe, L.P., with the transaction to be structured as the merger of

Hawke Acquisition Corp., a wholly-owned subsidiary of Carpenter, with and into Latrobe,

with Latrobe as the surviving entity.

G. “Acquisition Date” means the day on which the Acquisition occurs.

H. “Agency(ies)” means any government regulatory authority or authorities in the world

responsible for granting approval(s), specifications(s), clearance(s), qualification(s),

license(s), or permit(s) for any aspect of the research, Development, manufacture,

marketing, distribution, or sale of a Specialty Metals Product. The term “Agency” includes,

with out limitation, the United States Department of Defense.

I. “Closing Date” means the date on which Respondent(s) (or a Divestiture Trustee)

consummates a transaction to assign, grant, license, divest, transfer, deliver, or otherwise

convey the Specialty Metal Product Assets and grants the Specialty Metal Product License

to an Acquirer pursuant to this Order.

J. “Confidential Business Information” means all information owned by, or in the possession

or control of, Respondent Latrobe that is not in the public domain and that is directly related

to the research, Development, manufacture, marketing, commercialization, importation,

exportation, cost, supply, sales, sales support, or use of the Specialty Metal Product(s). The

term “Confidential Business Information” excludes (i) information that is protected by the

attorney work product, attorney-client, joint defense or other privilege prepared in

connection with the Acquisition and relating to any United States, state, or foreign antitrust

or competition Laws and (ii) information relating to Respondent Latrobe’s general business
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strategies or practices relating to research, Development, manufacture, marketing or sales of

products that does not discuss with particularity the Specialty Metal Product(s).

K. “Contract Manufacture” means:

1. to manufacture, or to cause to be manufactured, a Contract Manufacture Product on

behalf of an Acquirer; and/or

2. to provide, or to cause to be provided, any part of the manufacturing process of a

Contract Manufacture Product on behalf of an Acquirer.

L. “Contract Manufacture Product(s)” means all raw materials, inputs, and components of a

Specialty Metal Product, and/or any finished goods that are provided for resale as Specialty

Metal Products.

M. “Copyrights” means rights to all original works of authorship of any kind directly related to

the Specialty Metal Product(s) and any registrations and applications for registrations

thereof, including, but not limited to, the following: all such rights with respect to all

promotional, marketing and advertising materials, educational and training materials for the

sales force, and sales forecasting models; copyrights in all process development data and

reports relating to the research and Development of the Specialty Metal Product(s) or of any

materials used in the research, Development, manufacture, marketing or sale of the

Specialty Metal Product(s), including copyrights in all raw data, statistical programs

developed (or modified in a manner material to the use or function thereof (other than

through user preferences)) to analyze research data, market research data, market

intelligence reports and statistical programs (if any) used for marketing and sales research;

all copyrights in customer information; all records relating to employees who accept

employment with the Acquirer (excluding any personnel records the transfer of which is

prohibited by applicable Law); all copyrights in records, including customer lists, sales

force call activity reports, vendor lists, sales data, manufacturing records, manufacturing

processes, and supplier lists; all copyrights in data contained in laboratory notebooks

relating to the Specialty Metal Product(s); all copyrights in analytical and quality control

data; and all correspondence with Agencies.

N. “Current Operating Condition” means that, as of the date of delivery to the Acquirer, the

equipment meets or exceeds all current operational, functional, productive and

manufacturing capabilities required to manufacture the Specialty Metals Product and meets

or exceeds all current U.S. Agency-approved protective workplace safety standards for the

operation of such equipment by workers.

O. “Development” means all research and development activities, including, without

limitation, the following: test method development; formulation, including without

limitation, customized formulation for a particular customer(s); mechanical properties

testing; performance testing; safety testing; composition measurements; process

development; manufacturing scale-up; development-stage manufacturing; quality
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assurance/quality control development; statistical analysis and report writing; and

conducting experiments and other activities for the purpose of obtaining or achieving any

and all Product Approvals and Specifications. “Develop” means to engage in Development.

P. “Direct Cost” means a cost not to exceed the cost of labor, material, travel and other

expenditures to the extent the costs are directly incurred to provide the relevant assistance or

service. “Direct Cost” to the Acquirer for its use of any of Respondents’ employees’ labor

shall not exceed the average hourly wage rate for such employee; provided, however, in

each instance where: (1) an agreement to divest relevant assets is specifically referenced

and attached to this Order, and (2) such agreement becomes a Remedial Agreement for a

Specialty Metal Product, “Direct Cost” means such cost as is provided in such Remedial

Agreement for that Specialty Metal Product.

Q. “Divestiture Trustee” means the trustee appointed by the Commission pursuant to the

relevant provisions of this Order.

R. “Employee Information” means the following, for each Specialty Metal Product Core

Employee, as and to the extent permitted by the Law:

1. a complete and accurate list containing the name of each relevant employee (including

former employees who were employed by Respondent Latrobe within ninety (90) days

of the execution date of any Remedial Agreement); and

2. with respect to each such employee, the following information:

a. the date of hire and effective service date;

b. job title or position held;

c. a specific description of the employee’s responsibilities related to the relevant

Specialty Metal Product;

d. the base salary or current wages;

e. the most recent bonus paid, aggregate annual compensation for Respondents’ last

fiscal year and current target or guaranteed bonus, if any;

f. employment status (i.e., active or on leave or disability; full-time or part-time); and

g. any other material terms and conditions of employment in regard to such employee

that are not otherwise generally available to similarly situated employees.

S. “Eramet” means Eramet, S.A., a corporation organized, existing, and doing business under

and by virtue of the laws of the French Republic, with its offices and principal place of
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business located at 33 avenue du Maine, 75015 Paris France. Eramet is a group of

companies that includes Aubert & Duval, Erasteel Company, and Brown Europe.

T. “Government Entity” means any Federal, state, local or non-U.S. government, or any court,

legislature, government agency, or government commission, or any judicial or regulatory

authority of any government.

U. “High Volume Account(s)” means any customer of Respondent Latrobe whose annual

and/or projected annual aggregate purchase amounts (on a company-wide level), in units or

in dollars, of a Specialty Metal Product from Respondent Latrobe was, is, or is projected to

be, among the top ten highest of such purchase amounts by Respondent Latrobe’s customers

on each of the following dates: (1) the end of the last quarter that immediately preceded the

date of the public announcement of the proposed Acquisition, i.e., June 20, 2011; (2) the

end of the last year that immediately preceded the Acquisition Date; (3) the end of the last

quarter that immediately preceded the Closing Date for the Specialty Metal Product Assets;

or 4) the end of the last quarter following the Acquisition and/or the Closing Date.

V. “Interim Monitor” means any monitor appointed pursuant to Paragraph III of this Order or

Paragraph III of the related Order to Maintain Assets.

W. “Law” means all laws, statutes, rules, regulations, ordinances, and other pronouncements by

any Government Entity having the effect of law.

X. “Manufacturing Employees” means all salaried or skilled-labor employees of Respondent

Latrobe who have directly participated in the planning, design, implementation, use, or

operational management of the Manufacturing Technology (irrespective of the portion of

working time involved unless such participation consisted solely of oversight of legal,

accounting, tax or financial compliance) within the five (5) year period immediately prior to

the Closing Date; provided, however, in each instance where: (i) an agreement to divest

relevant assets is specifically referenced and attached to this Order, and (ii) such agreement

becomes a Remedial Agreement for the Specialty Metal Products, “Manufacturing

Employees” means the specific individuals identified as “Manufacturing Employees” in

such Remedial Agreement.

Y. “Manufacturing Technology” means all technology, trade secrets, know-how, and

proprietary information (whether patented, patentable or otherwise) used at any time within

the five (5) year period immediately preceding the Closing Date by Respondent Latrobe to

manufacture each Specialty Metal Product, including, but not limited to, the following: 

1. product specifications, including without limitation, the exact combination and

proportion of metals, other agents, reactive diluents and other components that achieves

a particular set of application and end-use characteristics (e.g., shear strength, tensile

strength, yield strength) in a final Specialty Metals Product;
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2. processes, including without limitation, aging, annealing, bump pressing, cold drawing,

cutting, grinding, pickling, quenching, shot blasting, solutionizing, and swaging;

3. standard operating procedures; 

4. product designs and design protocols; 

5. plans, ideas, and concepts;

6. repair and performance records related to the Specialty Metal Product Equipment for the

two (2) year period immediately preceding the Closing Date;

7. records related to the protective workplace safety standards related to the Specialty

Metal Product Equipment for the two (2) year period immediately preceding the Closing

Date;

8. safety procedures for handling of materials and substances;

9. flow diagrams;

10. quality assurance and control procedures; 

11. research records; 

12. annual product reviews;

13. manuals and technical information provided to employees, customers, suppliers, agents

or licensees including, without limitation, manufacturing, equipment, and engineering

manuals and drawings;

14. audits of manufacturing methods for Specialty Metal Products conducted by all of the

following:

a. applicable United States’ Agencies;

b. non-governmental Persons that provide audits and certifications of management

systems and/or manufacturing processes and product assessments and certifications

related to the use of metals or metal alloys for applications in the aerospace industry

(e.g., National Aerospace and Defense Contractors Accreditation Program,

Performance Review Institute, and American Society for Testing Materials);

c. direct purchasers of Specialty Metal Products that use the Specialty Metal Products

to manufacture products (e.g., aerospace fasteners) for aerospace applications; and
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d. end-users of products for aerospace applications that are made from Specialty Metal

Products (e.g., manufacturers of United States’ military aircraft and components, jet

aircraft, jet aircraft landing gear, or jet engines); 

15. control history; 

16. labeling;

17. supplier lists;

18. chemical descriptions and specifications of, all raw materials inputs, components, and

ingredients related to the Specialty Metal Products; and 

19. all other information related to the manufacturing process.

Z. “Marketing and Business Development Employees” means all management-level

employees of Respondent Latrobe who directly have participated (irrespective of the portion

of working time involved) in the marketing, contracting, pricing or promotion of the

Specialty Metal Products to customers within the two (2) year period immediately prior to

the Closing Date. These employees include, without limitation, all management-level

employees having any responsibilities in the areas of sales management, brand

management, sales training, market research, business development, and specialty metal

alloy markets for use in Aerospace applications, but excludes administrative assistants;

provided, however, in each instance where: (i) an agreement to divest relevant assets is

specifically referenced and attached to this Order, and (ii) such agreement becomes a

Remedial Agreement for the Specialty Metal Products, “Marketing and Business

Development Employees” means the specific individuals identified as “Marketing and

Business Development Employees” in such Remedial Agreement. 

AA. “Marketing Materials” means all marketing materials used specifically in the marketing or

sale of a Specialty Metal Product(s) prior to and as of the Closing Date, including, without

limitation, all advertising materials, training materials, product data, mailing lists, sales

materials (e.g., sales call reports, vendor lists, sales data), marketing information (e.g.,

competitor information, research data, market intelligence reports, statistical programs (if

any) used for marketing and sales research), customer information (including customer net

purchases information to be provided on the basis of either dollars and/or units for each

month, quarter or year), sales forecasting models, educational materials, and advertising and

display materials, speaker lists, promotional and marketing materials, Website content and

advertising and display materials, video masters and other similar materials related to the

Specialty Metal Product(s). The term “Marketing Materials” excludes documents relating

to the Respondents’ general business strategies or practices relating to the marketing or

sales of specialty metal alloys, where such documents do not discuss with particularity the

Specialty Metal Products.
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BB. “MP35N Product(s)” means an alloy with a nominal chemical composition of 35 percent

Nickel, 35 percent Cobalt, 20 percent Chromium, and 10 percent Molybdenum and that 

meets the following Aerospace Materials Specifications: AMS 5758 (solution heat treated

and centerless ground bars); AMS 5844 (solution heat treated and cold drawn bars); AMS

5845 (solution heat treated, cold drawn and aged bars); and/or, AMS 7468 (bolts, screws,

forged head, roll threaded after aging). 

CC. “MP 159 Product(s)” means an alloy with a nominal chemical composition of 25.5 percent

Nickel, 35.7 percent Cobalt, 19.0 percent Chromium, 9.0 percent Iron, 7.0 percent

Molybdenum, 3.0 percent Titanium, 0.6 percent Columbium (Niobium), and 0.2 percent

Aluminum and that meets the following Aerospace Materials Specifications: AMS 5841,

AMS 5842; and/or AMS 5843.

DD. “Order Date” means the date on which this Decision and Order becomes final and effective. 

EE. “Order to Maintain Assets” means the Order to Maintain Assets incorporated into and made

a part of the Agreement Containing Consent Orders.

FF. “Patents” means all patents, patent applications, including provisional patent applications,

invention disclosures, certificates of invention and applications for certificates of invention

and statutory invention registrations, in each case existing as of the Closing Date (except

where this Order specifies a different time), and includes all reissues, additions, divisions,

continuations, continuations-in-part, supplementary protection certificates, extensions and

reexaminations thereof, all inventions disclosed therein, and all rights therein provided by

international treaties and conventions, related to any product of or owned by Respondents as

of the Closing Date (except where this Order specifies a different time).

GG. “Person” means any individual, partnership, joint venture, firm, corporation, association,

trust, unincorporated organization, or other business or Government Entity, and any

subsidiaries, divisions, groups or affiliates thereof.

HH. “Product Approval(s) and Specification(s)” means the approvals, specifications,

certifications, registrations, permits, licenses, consents, authorizations, and other approvals,

and pending applications and requests therefor, related to the research, Development,

manufacture, distribution, finishing, packaging, marketing, sale, storage or transport of the

Specialty Metals Products that have been adopted or required as of the Closing Date by the

following:

1. applicable Agencies;

2. non-governmental Persons that provide audits and certifications of management systems

and/or manufacturing processes and product assessments and certifications related to the

use of metals or metal alloys for applications in the aerospace industry (e.g., National

Aerospace and Defense Contractors Accreditation Program, Performance Review

Institute, and American Society for Testing Materials);
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3. direct purchasers of Specialty Metal Products that use the Specialty Metal Products to

manufacture products (e.g., aerospace fasteners) for aerospace applications; and

4. end-users of products for aerospace applications that are made from Specialty Metal

Products (e.g., manufacturers of United States military aircraft and components, jet

aircraft, jet aircraft landing gear, or jet engines).

II. “Product Assumed Contracts” means all of the following contracts or agreements (copies of

each such contract to be provided to the Acquirer on or before the Closing Date and

segregated in a manner that clearly identifies the purpose(s) of each such contract):

1. that make specific reference to any Specialty Metal Product and pursuant to which any

Third Party purchases, or has the option to purchase, any Specialty Metal Product from

Respondent Latrobe;

2. relating to any experiments, audits, or scientific studies involving any Specialty Metal

Product;

3. with universities or other research institutions for the use of any Specialty Metal Product

in scientific research;

4. relating to the particularized marketing of any Specialty Metal Product or educational

matters relating solely to any Specialty Metal Product;

5. pursuant to which a Third Party provides the Manufacturing Technology related to any

Specialty Metal Product to Respondent Latrobe;

6. pursuant to which a Third Party is licensed by Respondent Latrobe to use the

Manufacturing Technology;

7. constituting confidentiality agreements involving any Specialty Metal Product;

8. involving any royalty, licensing, or similar arrangement involving any Specialty Metal

Product;

9. pursuant to which a Third Party provides any specialized services necessary to the

research, Development, manufacture or distribution of the Specialty Metal Products to

Respondent Latrobe including, but not limited to, consultation arrangements;

10. pursuant to which any Third Party collaborates with Respondent Latrobe in the

performance of research, Development, marketing, distribution or selling of any

Specialty Metal Product or the business associated with the Specialty Metal Products;

and/or
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provided, however, that where any such contract or agreement also relates to a Retained

Product(s), Respondent Latrobe shall assign the Acquirer all such rights under the

contract or agreement as are related to the Specialty Metal Product(s), but concurrently

may retain similar rights for the purposes of the Retained Product(s).

JJ. “Product Intellectual Property” means all of the following related to each Specialty Metal

Product:

1. Patents;

2. Copyrights;

3. Software; 

4. trade secrets, know-how, utility models, design rights, techniques, data, inventions,

practices, recipes, raw material specifications, process descriptions, quality control

methods in process and in final Specialty Metal Products, protocols, methods and other

confidential or proprietary technical, business, research, Development and other

information, and all rights in any jurisdiction to limit the use or disclosure thereof;

5. rights to obtain and file for patents and copyrights and registrations thereof; and

6. rights to sue and recover damages or obtain injunctive relief for infringement, dilution,

misappropriation, violation or breach of any of the foregoing; 

provided, however, Product Intellectual Property expressly includes all customer

specific product formulations for Specialty Metal Products that are owned, licensed,

or in the possession of, Respondent Latrobe, licenses from customers related to the

manufacture of products for that specific customer, and all proprietary and/or trade

secret information related to a particular customer that are owned, licensed, or in the

possession of, Respondent Latrobe;

provided further, however, “Product Intellectual Property” excludes Product

Trademarks.

KK. “Product Trademark(s)” means all proprietary names or designations, trademarks, service

marks, trade names, and brand names, including registrations and applications for

registration therefor (and all renewals, modifications, and extensions thereof) and all

common law rights, and the goodwill symbolized thereby and associated therewith, for the

Specialty Metal Product(s);

provided, however, “Product Trademark(s)” does not include the corporate names or

corporate trade dress of “Carpenter” or “Latrobe” or the related corporate logos thereof,

or the corporate names or corporate trade dress of any other corporations or companies

owned or controlled by the Respondents or the related corporate logos thereof, or general
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registered images or symbols by which either Carpenter or Latrobe can be identified or

defined.

LL. “Proposed Acquirer” means an entity proposed by Respondents (or a Divestiture Trustee) to

the Commission and submitted for the approval of the Commission to become the Acquirer

of particular assets required to be assigned, granted, licensed, divested, transferred,

delivered or otherwise conveyed by Respondents pursuant to this Order.

MM. “Remedial Agreement(s)” means the following: 

1. any agreement between Respondents and an Acquirer that is specifically referenced and

attached to this Order, including all amendments, exhibits, attachments, agreements, and

schedules thereto, related to the relevant assets or rights to be assigned, granted,

licensed, divested, transferred, delivered, or otherwise conveyed, and that has been

approved by the Commission to accomplish the requirements of the Order in connection

with the Commission’s determination to make this Order final and effective; 

2. any agreement between Respondents and a Third Party to effect the assignment of assets

or rights of Respondents related to a Specialty Metal Product to the benefit of an

Acquirer that is specifically referenced and attached to this Order, including all

amendments, exhibits, attachments, agreements, and schedules thereto, that has been

approved by the Commission to accomplish the requirements of the Order in connection

with the Commission’s determination to make this Order final and effective; 

3. any agreement between Respondents and an Acquirer (or between a Divestiture Trustee

and an Acquirer) that has been approved by the Commission to accomplish the

requirements of this Order, including all amendments, exhibits, attachments,

agreements, and schedules thereto, related to the relevant assets or rights to be assigned,

granted, licensed, divested, transferred, delivered, or otherwise conveyed, and that has

been approved by the Commission to accomplish the requirements of this Order; and/or 

4. any agreement between Respondents and a Third Party to effect the assignment of assets

or rights of Respondents related to a Specialty Metal Product to the benefit of an

Acquirer that has been approved by the Commission to accomplish the requirements of

this Order, including all amendments, exhibits, attachments, agreements, and schedules

thereto.

NN. “Research and Development Employees” means all salaried or skilled-labor employees of

Respondent Latrobe who directly have participated in the research, Development, or process

to obtain or achieve Product Approvals and Specifications for the Specialty Metal Products

(irrespective of the portion of working time involved, unless such participation consisted

solely of oversight of legal, accounting, tax or financial compliance) within the five (5) year

period immediately prior to the Closing Date; provided, however, in each instance where: 

(i) an agreement to divest relevant assets is specifically referenced and attached to this

Order, and (ii) such agreement becomes a Remedial Agreement for the Specialty Metal
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Products, “Research and Development Employees” means the specific individuals identified

as “Research and Development Employees” in such Remedial Agreement.

OO. “Research and Development Records” means all research and development records relating

to Specialty Metal Products including, but not limited to:

1. inventory of research and development records, research history, research efforts,

research notebooks, research reports, technical service reports, testing methods,

invention disclosures, and know how related to the Specialty Metal Products;

2. all correspondence, submissions, notifications, communications, registrations or other

filings made to, received from or otherwise conducted with (i) Agencies and (ii) nongovernmental Persons that provide audits and certifications of management systems

and/or manufacturing processes and product assessments and certifications (e.g.,

National Aerospace and Defense Contractors Accreditation Program, Performance

Review Institute, and American Society for Testing Materials) relating to Product

Approval(s) and Specification(s) submitted by, on behalf of, or acquired by, Respondent

Latrobe related to the Specialty Metal Products;

3. designs of experiments, and the results of successful and unsuccessful designs and

experiments;

4. annual and periodic reports (both internal and external) related to the above-described

Product Approval(s) and Specification(s);

5. currently used product usage instructions related to the Specialty Metal Products;

6. reports relating to the protection of human safety and health related to the manufacture

or use of the Specialty Metal Products;

7. reports relating to the protection of the environment related to the manufacture or use of

the Specialty Metal Products;

8. summary of performance reports, safety reports, and product complaints from customers

related to the Specialty Metal Products; and

9. product recall reports filed with any Agency related to the Specialty Metal Products. 

PP. “Retained Product(s)” means any product(s) that is not a Specialty Metals Product.

QQ. “Sales Employee(s)” means all employees of Respondent Latrobe who directly have

participated (irrespective of the portion of working time involved) in the marketing or

promotion of the Specialty Metal Product(s) directly to customers within the three (3) year

period immediately prior to the Closing Date. This includes employees trained to perform

such sales activity for a Specialty Metal Product within the three (3) year period
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immediately prior to the Closing Date, provided, however, in each instance where: (i) an

agreement to divest relevant assets is specifically referenced and attached to this Order, and

(ii) such agreement becomes a Remedial Agreement for the Specialty Metal Products,

“Sales Employees” means the specific individuals identified as “Sales Employees” in such

Remedial Agreement.

RR. “Software” means computer programs related to the Specialty Metal Product(s), including

all software implementations of algorithms, models, and methodologies whether in source

code or object code form, databases and compilations, including any and all data and

collections of data, all documentation, including user manuals and training materials, related

to any of the foregoing and the content and information contained on any Website;

provided, however, that “Software” does not include software that is readily purchasable or

licensable from sources other than the Respondents and which has not been modified in a

manner material to the use or function thereof (other than through user preference settings).

SS. “Specialty Metal Products” means the MP35N Products and the MP159 Products

Developed, in Development, researched, manufactured, marketed or sold by Respondent

Latrobe for use in aerospace applications at any time prior to the Acquisition. 

TT. “Specialty Metal Product Assets” means all of Respondent Latrobe’s rights, title and

interest in and to all assets related to Respondent Latrobe’s business within the United

States of America related to each of the Specialty Metal Products to the extent legally

transferable, including the research, Development, manufacture, distribution, marketing, and

sale of each Specialty Metal Product, including, without limitation, the following: 

1. copies of all Research and Development Records;

2. at the Acquirer’s option, all Product Assumed Contracts related to the Specialty Metal

Product(s) (copies to be provided to the Acquirer on or before the Closing Date);

3. a list of all customers and/or targeted customers for the Specialty Metal Product(s) and

the net sales (in either units or dollars) of the Specialty Metal Products to such

customers on either an annual, quarterly, or monthly basis including, but not limited to,

a separate list specifying the above-described information for the High Volume

Accounts and including the name of the employee(s) for each High Volume Account

that is or has been responsible for the purchase of the Specialty Metal Products on

behalf of the High Volume Account and his or her business contact information; 

4. at the Acquirer’s option and to the extent approved by the Commission in the relevant

Remedial Agreement, all inventory in existence as of the Closing Date, including, but

not limited to, raw materials, supplies, operating materials, work-in-process, and

finished goods, and other items of inventory related to the Specialty Metal Product(s); 
15

5. copies of all unfilled customer purchase orders for the Specialty Metal Product(s) as of

the Closing Date, to be provided to the Acquirer not later than two (2) days after the

Closing Date;

6. at the Acquirer’s option, subject to any rights of the customer, all unfilled customer

purchase orders for the Specialty Metal Products;

7. the Specialty Metal Product Equipment; and

8. copies of all of the Respondent Latrobe’s books and records, customer files, customer

lists and records, vendor files, vendor lists and records, cost files and records, credit

information, distribution records, business records and plans, studies, surveys, and files

related to the foregoing or to the Specialty Metal Product(s);

provided however, “Specialty Metal Product Assets” excludes (1) documents relating

to the Respondent Latrobe’s general business strategies or practices relating to

research, Development, manufacture, marketing or sales of specialty metal alloys,

where such documents do not discuss with particularity the Specialty Metal Products;

(2) administrative, financial, and accounting records; (3) quality control records that

are determined not to be material to the manufacture of the Specialty Metal Products

by the Interim Monitor or the Acquirer of the Specialty Metal Products; and (4) any

real estate and the buildings and other permanent structures located on such real

estate.

UU. “Specialty Metal Product Core Employees” means the Manufacturing Employees,

Marketing and Business Development Employees, the Research and Development

Employees, and the Sales Employees.

VV. “Specialty Metal Product Divestiture Agreements” means the following agreements:

1. “Product Line Purchase Agreement” by and between Carpenter Technology

Corporation, Latrobe Specialty Metals, and Eramet, S.A., dated as of February 16, 2012,

and all amendments, exhibits, attachments, agreements, and schedules thereto;

2. “Supply Agreement” by and between Carpenter Technology Corporation, Latrobe

Specialty Metals, and Eramet, S.A., dated as of February 16, 2012, and all amendments,

exhibits, attachments, agreements, and schedules thereto; and

3. “Consulting Agreement” by and between Carpenter Technology Corporation, Latrobe

Specialty Metals, and Eramet, S.A., dated as of February 16, 2012, and all amendments,

exhibits, attachments, agreements, and schedules thereto;

each related to the Specialty Metal Product Assets that have been approved by the

Commission to accomplish the requirements of this Order. The Specialty Metal Product
16

Divestiture Agreements are attached to this Order and contained in non-public Appendix

A.

WW. “Specialty Metal Product Equipment” means all equipment listed as “Purchased Assets” in

the “Specialty Metal Product Divestiture Agreements”in Non-Public Appendix A,

including, without limitation, draw benches, dies and other ancillary finishing equipment.

XX. “Specialty Metal Product License” means a perpetual, non-exclusive, fully paid-up and

royalty-free license(s) with rights to sublicense to all of Respondent Latrobe’s rights, title

and interest in, the following:

1. all Product Intellectual Property related to the Specialty Metal Product(s);

2. all Product Approvals and Specifications related to the Specialty Metal Product(s);

3. all Manufacturing Technology related to the Specialty Metal Product(s);

4. all Marketing Materials related to the Specialty Metal Product(s); and

5. all Product Development Reports related to the Specialty Metal Product(s);

to the extent legally transferable by license, and, including, without limitation, rights to

copies of all of the Respondent Latrobe’s books and records related to the foregoing.

YY. “Specialty Metal Product Releasee(s)” means the Acquirer or any entity controlled by or

under common control with the Acquirer, or any licensees, sublicensees, manufacturers,

suppliers, distributors, and customers of the Acquirer, or of the Acquirer-affiliated entities.

ZZ. “Supply Cost” means a cost not to exceed the manufacturer’s average direct per unit cost in

United States dollars of manufacturing the Specialty Metal Product, or raw material or

ingredients related to a Specialty Metal Product, for the twelve (12) month period

immediately preceding the Acquisition Date. “Supply Cost” shall expressly exclude any

intracompany business transfer profit; provided, however, that in each instance where: (1)

an agreement to Contract Manufacture is specifically referenced and attached to this Order,

and (2) such agreement becomes a Remedial Agreement for a Specialty Metal Product,

“Supply Cost” means the cost as specified in such Remedial Agreement for that Specialty

Metal Product.

AAA. “Third Party(ies)” means any non-governmental Person other than the following: the

Respondent; or, the Acquirer of particular assets or rights pursuant to this Order.
17

II.

IT IS FURTHER ORDERED that:

A. Not later than the earlier of: (i) ten (10) days after the Acquisition Date or (ii) ten (10) days

after the Order Date, Respondents shall divest the Specialty Metal Product Assets and grant

the Specialty Metal Product License, absolutely and in good faith, to Eramet pursuant to,

and in accordance with, the Specialty Metal Product Divestiture Agreements (which

agreements shall not limit or contradict, or be construed to limit or contradict, the terms of

this Order, it being understood that this Order shall not be construed to reduce any rights or

benefits of Eramet or to reduce any obligations of Respondents under such agreements), and

each such agreement, if it becomes a Remedial Agreement related to the Specialty Metal

Product Assets, is incorporated by reference into this Order and made a part hereof; 

provided, however, that if Respondents have divested the Specialty Metal Product Assets

and granted the Special Metal Product License to Eramet prior to the Order Date, and if,

at the time the Commission determines to make this Order final and effective, the

Commission notifies Respondents that Eramet is not an acceptable purchaser of the

Specialty Metal Product Assets then Respondents shall immediately rescind the

transaction with Eramet, in whole or in part, as directed by the Commission, and shall

divest the Specialty Metal Product Assets and grant the Specialty Metal Product License,

within one hundred eighty (180) days from the Order Date, absolutely and in good faith,

at no minimum price, to an Acquirer and only in a manner that receives the prior

approval of the Commission;

provided further, that if Respondents have divested the Specialty Metal Product Assets

and granted the Specialty Metal Product License to Eramet prior to the Order Date, and

if, at the time the Commission determines to make this Order final and effective, the

Commission notifies Respondents that the manner in which the divestiture or grant of

license was accomplished is not acceptable, the Commission may direct Respondents, or

appoint a Divestiture Trustee, to effect such modifications to the manner of divestiture of

the Specialty Metal Product Assets or grant of the Specialty Metal Product License to

Eramet (including, but not limited to, entering into additional agreements or

arrangements) as the Commission may determine are necessary to satisfy the

requirements of this Order.

B. Prior to the Acquisition Date, and as a condition precedent to the consummation of the

Acquisition, Respondents shall secure all consents and waivers from all Third Parties that

are necessary to permit Respondents to divest the Specialty Metal Product Assets and grant

the Specialty Metals Product License to the Acquirer, and/or to permit the Acquirer to

continue the research, Development, manufacture, sale, marketing or distribution of the

Specialty Metal Products;
18

provided, however, Respondents may satisfy this requirement by certifying that the

Acquirer has executed all such agreements directly with each of the relevant Third

Parties.

C. Respondents shall:

1. deliver the Specialty Metals Product Equipment to the Acquirer in Current Operating

Condition; provided however, that, subject to the consent of the Acquirer on a piece-bypiece basis, Respondents, at Respondents’ own expense, may substitute equipment in

Current Operating Condition that: 

a. is suitable for the same use as the particular piece of Specialty Metals Product

Equipment that is the subject of the proposed substitution; and 

b. meets or exceeds the operational, functional, productive and manufacturing

capabilities of the particular piece of the Specialty Metals Product Equipment that is

the subject of the proposed substitution; and

2. at the Acquirer’s option, provide such technical assistance as is necessary to integrate

the Specialty Metals Product Equipment (or any equipment substituted pursuant to

Paragraph II.C.1) into the Acquirer’s facility for use in the manufacture of Specialty

Metals Products.

D. Respondents shall provide the Manufacturing Technology to the Acquirer in an organized,

comprehensive, complete, useful, timely, and meaningful manner. Respondents shall, inter

alia:

1. designate employees of Respondents knowledgeable with respect to such Manufacturing

Technology to a committee for the purposes of communicating directly with the

Acquirer and the Interim Monitor (if any has been appointed) for the purposes of

effecting such delivery;

2. prepare technology transfer protocols and transfer acceptance criteria for both the

processes and analytical methods related to the Specialty Metal Products, such protocols

and acceptance criteria to be subject to the approval of the Acquirer;

3. prepare and implement a detailed technological transfer plan that contains, inter alia, 

the delivery of all relevant information, all appropriate documentation, all other

materials, and projected time lines for the delivery of all Manufacturing Technology to

the Acquirer; and 

4. upon reasonable written notice and request from the Acquirer to Respondents, provide

in a timely manner, at no greater than Direct Cost, assistance and advice to enable the

Acquirer to:
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a. manufacture the Specialty Metal Products in the same quality achieved by 

Respondent Latrobe and in commercial quantities;

b. obtain or achieve any Product Approvals and Specifications necessary for the

Acquirer to manufacture, sell, market or distribute the Specialty Metal Products;

and 

c. receive, integrate, and use such Manufacturing Technology.

E. Respondents shall:

1. Contract Manufacture and deliver to the Acquirer, in a timely manner and under

reasonable terms and conditions, a supply of each of the Contract Manufacture Products

at Respondents’ Supply Cost, for a period of time sufficient to allow the Acquirer to:

a. obtain or achieve all of the relevant Product Approvals and Specifications necessary

to manufacture and sell in commercial quantities, the Contract Manufacture

Products independently of Respondents; and

b. to secure sources of supply of the raw materials, inputs and components for the

Contract Manufacture Products from entities other than Respondents;

2. make representations and warranties to the Acquirer that the Contract Manufacture

Product(s) supplied through Contract Manufacture pursuant to a Remedial Agreement

meets the relevant Aerospace Material Specifications and the relevant customer

specifications for Aerospace use; 

3. for the Contract Manufacture Products supplied by Respondents, Respondents shall

agree to indemnify, defend and hold the Acquirer harmless from any and all suits,

claims, actions, demands, liabilities, expenses or losses alleged to result from the failure

of the Contract Manufacture Products supplied by Respondents to the Acquirer to meet

all relevant Product Approvals and Specifications. This obligation may be made

contingent upon the Acquirer giving Respondents prompt, adequate notice of such claim

and cooperating fully in the defense of such claim. The Remedial Agreement to

Contract Manufacture shall be consistent with the obligations assumed by Respondents

under this Order; provided, however, that Respondents may reserve the right to control

the defense of any such litigation, including the right to settle the litigation, so long as

such settlement is consistent with Respondents’ responsibilities to supply the Contract

Manufacture Products in the manner required by this Order; provided further, that this

obligation shall not require Respondents to be liable for any negligent act or omission of

the Acquirer or for any representations and warranties, express or implied, made by the

Acquirer that exceed the representations and warranties made by Respondents to the

Acquirer;
20

4. make representations and warranties to the Acquirer that Respondents shall hold

harmless and indemnify the Acquirer for any liabilities or loss of profits resulting from

the failure by Respondents to deliver the Contract Manufacture Products in a timely

manner as required by the Remedial Agreement to Contract Manufacture unless

Respondents can demonstrate that their failure was entirely beyond the control of

Respondents and in no part the result of negligence or willful misconduct by

Respondents; 

5. during the term of the Remedial Agreement to Contract Manufacture, upon request of

the Acquirer or Interim Monitor (if any has been appointed), make available to the

Acquirer and the Interim Monitor (if any has been appointed) all records that relate to

the manufacture, storage, or transport of the Contract Manufacture Products that are

generated or created after the Closing Date;

6. during the term of the Remedial Agreement to Contract Manufacture, maintain

manufacturing facilities necessary to manufacture each of the Contract Manufacture

Products; and

7. during the term of the Remedial Agreement to Contract Manufacture, provide

consultation with knowledgeable employees of Respondents and training, at the request

of the Acquirer and at a facility chosen by the Acquirer, for the purposes of enabling the

Acquirer to obtain or achieve all Product Approvals and Specifications to manufacture

Specialty Metal Products in the same quality achieved by the Respondent Latrobe and in

commercial quantities, and in a manner consistent with the relevant customer

specifications for Aerospace use, independently of Respondents, and sufficient to satisfy

management of the Acquirer that its personnel are adequately trained in the manufacture

of Specialty Metal Products.

The foregoing provisions, II.E.1. - 7., shall remain in effect with respect to each Contract

Manufacture Product until the earliest of the following dates: (i) the date eighteen (18)

months from the date that the Respondent completes delivery of all pieces of the

Specialty Metals Product Equipment to the Acquirer in a manner consistent with this

Order; or (ii) the date three (3) years from the Order Date. 

F. Respondents shall:

1. submit to the Acquirer, at Respondents’ expense, copies of all Confidential Business

Information;

2. deliver copies of the Confidential Business Information as follows:

a. in good faith; 

b. in a timely manner, i.e., as soon as practicable, avoiding any delays in transmission

of the respective information; and 
21

c. in a manner that ensures its completeness and accuracy and that fully preserves its

usefulness; and

3. pending complete delivery of copies of all Confidential Business Information to the

Acquirer, provide the Acquirer and the Interim Monitor (if any has been appointed) with

access to all such Confidential Business Information and employees who possess or are

able to locate such information for the purposes of identifying the books, records, and

files directly related to the Specialty Metal Products that contain such Confidential

Business Information and facilitating the delivery in a manner consistent with this

Order.

G. Respondents shall not enforce any agreement against a Third Party or the Acquirer to the

extent that such agreement may limit or otherwise impair the ability of the Acquirer to

acquire the Manufacturing Technology, Product Intellectual Property or Product

Trademarks, related to the relevant Specialty Metal Product(s) from the Third Party. Such

agreements include, but are not limited to, agreements with respect to the disclosure of

Confidential Business Information related to such Manufacturing Technology or Product

Intellectual Property.

H. Not later than ten (10) days after the Closing Date, Respondents shall grant a release to each

Third Party that is subject to an agreement as described in Paragraph II.G. that allows the

Third Party to provide the relevant Manufacturing Technology or Product Intellectual

Property to the Acquirer. Within five (5) days of the execution of each such release,

Respondents shall provide a copy of the release to the Acquirer for the relevant assets. 

I. Respondents shall:

1. for each Specialty Metal Product, for a period of at least eighteen (18) months from the

Closing Date, provide the Acquirer with the opportunity to enter into employment

contracts with the Specialty Metal Product Core Employees. Each of these periods is

hereinafter referred to as the “Specialty Metal Product Core Employee Access

Period(s)”; 

2. not later than the earlier of the following dates: (1) ten (10) days after notice by staff of

the Commission to Respondents to provide the Product Employee Information; or (2)

ten (10) days after the Closing Date, provide the Acquirer or the Proposed Acquirer with

the Product Employee Information related to the Specialty Metal Product Core

Employees. Failure by Respondents to provide the Product Employee Information for

any Specialty Metal Product Core Employee within the time provided herein shall

extend the Specialty Metal Product Core Employee Access Period(s) with respect to that

employee in an amount equal to the delay; and

3. during the Specialty Metal Product Core Employee Access Period(s), not interfere with

the hiring or employing by the Acquirer of the Specialty Metal Product Core Employees

related to the particular Specialty Metal Products and assets acquired by the Acquirer,
22

and remove any impediments within the control of Respondents that may deter these

employees from accepting employment with the Acquirer, including, but not limited to,

any noncompete or nondisclosure provision of employment with respect to a Specialty

Metal Product or other contracts with Respondents that would affect the ability or

incentive of those individuals to be employed by the Acquirer. In addition, Respondents

shall not make any counteroffer to such a Specialty Metal Product Core Employee who

has received a written offer of employment from the Acquirer;

provided, however, that, subject to the conditions of continued employment

prescribed in this Order, this Paragraph II.I.3. shall not prohibit Respondents from

continuing to employ any Specialty Metal Product Core Employee under the terms of

such employee’s employment with Respondents prior to the date of the written offer

of employment from the Acquirer to such employee.

J. Until Respondents complete the divestiture and grant of license required by Paragraph II.A.,

deliver the Specialty Metals Product Equipment to the Acquirer and provide the

Manufacturing Technology to the Acquirer,

1. Respondents shall take such actions as are necessary to:

a. maintain the full economic viability and marketability of the businesses associated

with each Specialty Metal Product;

b. minimize any risk of loss of competitive potential for such business;

c. prevent the destruction, removal, wasting, deterioration, or impairment of any of the

assets related to each Specialty Metal Product;

d. ensure the Specialty Metal Product Assets are delivered to the Acquirer in a manner

without disruption, delay, or impairment of the Product Approval and Specification

processes related to the business associated with each Specialty Metal Product;

e. ensure the completeness of the delivery of the Manufacturing Technology; and

2. Respondents shall not sell, transfer, encumber or otherwise impair the Specialty Metal

Product Assets (other than in the manner prescribed in this Order) nor take any action

that lessens the full economic viability, marketability, or competitiveness of the

businesses associated with each Specialty Metal Product.

K. Respondents shall not join, file, prosecute or maintain any suit, in law or equity, against the

Acquirer or the Specialty Metal Product Releasee(s) for the research, Development,

manufacture, use, import, export, distribution, or sale of the Specialty Metal Product(s)

under the following:
23

1. any Patent owned or licensed by Respondents as of the Acquisition Date that claims a

method of making, using, or a composition of matter, relating to a Specialty Metal

Product; 

2. any Patent owned or licensed at any time after the Acquisition Date by Respondents that

claim any aspect of the research, Development, manufacture, use, import, export,

distribution, or sale of a Specialty Metal Product, other than such Patents that claim

inventions conceived by and reduced to practice after the Acquisition Date;

if such suit would have the potential to interfere with the Acquirer’s freedom to practice

the following: (1) the research, Development, or manufacture of a particular Specialty

Metal Product; or (2) the use within, import into, export from, or the supply, distribution,

or sale within, the United States of a particular Specialty Metal Product. Respondents

shall also covenant to the Acquirer that as a condition of any assignment, transfer, or

license to a Third Party of the above-described Patents, the Third Party shall agree to

provide a covenant whereby the Third Party covenants not to sue the Acquirer or the

related Specialty Metal Product Releasee(s) under such Patents, if the suit would have the

potential to interfere with the Acquirer’s freedom to practice the following: (1) the

research, Development, or manufacture of a particular Specialty Metal Product; or (2) the

use within, import into, export from, or the supply, distribution, or sale within, the United

States of a particular Specialty Metal Product.

L. Upon reasonable written notice and request from an Acquirer to Respondent, Respondent

shall provide, in a timely manner, at no greater than Direct Cost, assistance of

knowledgeable employees of Respondent to assist that Acquirer to defend against, respond

to, or otherwise participate in any litigation related to the Product Intellectual Property

related to any of the Specialty Metal Products, if such litigation would have the potential to

interfere with the Acquirer’s freedom to practice the following: (1) the research,

Development, or manufacture of the Specialty Metal Products; or (2) the use within, import

into, export from, or the supply, distribution, or sale within the United States.

M. Within eighteen (18) months of the Closing Date, Respondents shall either license or assign

any and all intellectual property to the Acquirer that constitutes Product Intellectual

Property that the Acquirer, with the concurrence of the Interim Monitor, identifies as being

necessary to the conduct of the business associated with the Specialty Metal Product (as

such business had been conducted by Respondent Latrobe prior to the Acquisition Date) and

that was not listed and/or included in the intellectual property that was licensed or assigned

to the Acquirer pursuant to the Remedial Agreements previously submitted by Respondents

to the Commission. 

N. Respondents shall not seek, directly or indirectly, pursuant to any dispute resolution

mechanism incorporated in any Remedial Agreement, or in any agreement related to any of

the Specialty Metal Products a decision the result of which would be inconsistent with the

terms of this Order and/or the remedial purposes thereof.
24

O. No provision of this Order shall be interpreted to restrict the Respondents’ use of the

Manufacturing Technology, Product Intellectual Property, or Confidential Business

Information for the purposes of the research, Development, manufacture, marketing or sales

of any of Respondents’s own products, including MP 35N Products or MP 159 Products.

P. The purpose of the divestiture of the Specialty Metal Product Assets, the grant of the

Specialty Metals Product License, the provision of the Manufacturing Technology and the

related obligations imposed on the Respondents by this Order is:

1. to ensure the continued use of the Specialty Metal Product Assets in the research,

Development, manufacture, use, import, export, distribution, and sale of each of the

respective Specialty Metal Products;

2. to provide for the future use of the Specialty Metal Product Assets for the research,

Development, manufacture, use, import, export, distribution, and sale of each of the

respective Specialty Metal Products;

3. to create a viable and effective competitor, who is independent of the Respondents in the

research, Development, manufacture, use, import, export, distribution, or sale of each of

the respective Specialty Metal Products; and

4. to remedy the lessening of competition resulting from the Acquisition as alleged in the

Commission’s Complaint in a timely and sufficient manner.

III.

IT IS FURTHER ORDERED that:

A. At any time after Respondents sign the Consent Agreement in this matter, the Commission

may appoint a monitor (“Interim Monitor”) to assure that Respondents expeditiously

comply with all of their obligations and perform all of their responsibilities as required by

this Order, the Order to Maintain Assets, and the Remedial Agreements.

B. The Commission shall select the Interim Monitor, subject to the consent of Respondent

Carpenter, which consent shall not be unreasonably withheld. If Respondent Carpenter has

not opposed, in writing, including the reasons for opposing, the selection of a proposed

Interim Monitor within ten (10) days after notice by the staff of the Commission to

Respondent Carpenter of the identity of any proposed Interim Monitor, Respondents shall

be deemed to have consented to the selection of the proposed Interim Monitor.

C. Not later than ten (10) days after the appointment of the Interim Monitor, Respondents shall

execute an agreement that, subject to the prior approval of the Commission, confers on the

Interim Monitor all the rights and powers necessary to permit the Interim Monitor to
25

monitor Respondents’ compliance with the relevant requirements of the Order in a manner

consistent with the purposes of the Order.

D. If an Interim Monitor is appointed, Respondents shall consent to the following terms and

conditions regarding the powers, duties, authorities, and responsibilities of the Interim

Monitor:

1. the Interim Monitor shall have the power and authority to monitor Respondents’

compliance with the divestiture and asset maintenance obligations and related

requirements of the Order, and shall exercise such power and authority and carry out the

duties and responsibilities of the Interim Monitor in a manner consistent with the

purposes of the Order and in consultation with the Commission;

2. the Interim Monitor shall act in a fiduciary capacity for the benefit of the Commission;

and

3. the Interim Monitor shall serve until, the latter of:

a. the date of completion by Respondents of the divestiture of all Specialty Metal

Product Assets and the delivery of the Manufacturing Technology and Product

Intellectual Property in a manner that fully satisfies the requirements of this Order;

and 

b. with respect to each Specialty Metal Product, the date the Acquirer has obtained or

achieved all Product Approvals and Specifications necessary to manufacture,

market, import, export, and sell such Specialty Metal Product for use for aerospace

applications and able to manufacture such Specialty Metal Product in commercial

quantities independently of Respondents;

provided, however, that the Interim Monitor’s service shall not exceed five (5) years

from the Order Date; 

provided further, that the Commission may shorten or extend this period as may be

necessary or appropriate to accomplish the purposes of the Orders.

E. Subject to any demonstrated legally recognized privilege, the Interim Monitor shall have

full and complete access to Respondents’ personnel, books, documents, records kept in the

normal course of business, facilities and technical information, and such other relevant

information as the Interim Monitor may reasonably request, related to Respondents’

compliance with their obligations under the Order, including, but not limited to, their

obligations related to the relevant assets. Respondents shall cooperate with any reasonable

request of the Interim Monitor and shall take no action to interfere with or impede the

Interim Monitor's ability to monitor Respondents’ compliance with the Order.
26

F. The Interim Monitor shall serve, without bond or other security, at the expense of

Respondent, on such reasonable and customary terms and conditions as the Commission

may set. The Interim Monitor shall have authority to employ, at the expense of Respondent,

such consultants, accountants, attorneys and other representatives and assistants as are

reasonably necessary to carry out the Interim Monitor’s duties and responsibilities.

G. Respondents shall indemnify the Interim Monitor and hold the Interim Monitor harmless

against any losses, claims, damages, liabilities, or expenses arising out of, or in connection

with, the performance of the Interim Monitor’s duties, including all reasonable fees of

counsel and other reasonable expenses incurred in connection with the preparations for, or

defense of, any claim, whether or not resulting in any liability, except to the extent that such

losses, claims, damages, liabilities, or expenses result from gross negligence, willful or

wanton acts, or bad faith by the Interim Monitor.

H. Respondent shall report to the Interim Monitor in accordance with the requirements of this

Order and/or as otherwise provided in any agreement approved by the Commission. The

Interim Monitor shall evaluate the reports submitted to the Interim Monitor by Respondent,

and any reports submitted by the Acquirer with respect to the performance of Respondent’s

obligations under the Order or the Remedial Agreement(s). Within thirty (30) days from the

date the Interim Monitor receives these reports, the Interim Monitor shall report in writing

to the Commission concerning performance by Respondent of its obligations under the

Order; provided, however, beginning ninety (90) days after Respondent has filed its final

report pursuant to Paragraph V.B., and every ninety (90) days thereafter, the Interim

Monitor shall report in writing to the Commission concerning progress by the Acquirer

toward:

1. obtaining or achieved all of the relevant Product Approvals and Specifications necessary

to manufacture in commercial quantities, the Specialty Metal Products independently of

Respondents; and

2. securing sources of supply of the raw materials, inputs and components for the Specialty

Metal Products from entities other than Respondents.

I. Respondents may require the Interim Monitor and each of the Interim Monitor’s

consultants, accountants, attorneys and other representatives and assistants to sign a

customary confidentiality agreement; provided, however, that such agreement shall not

restrict the Interim Monitor from providing any information to the Commission.

J. The Commission may, among other things, require the Interim Monitor and each of the

Interim Monitor’s consultants, accountants, attorneys and other representatives and

assistants to sign an appropriate confidentiality agreement related to Commission materials

and information received in connection with the performance of the Interim Monitor’s

duties.
27

K. If the Commission determines that the Interim Monitor has ceased to act or failed to act

diligently, the Commission may appoint a substitute Interim Monitor in the same manner as

provided in this Paragraph.

L. The Commission may on its own initiative, or at the request of the Interim Monitor, issue

such additional orders or directions as may be necessary or appropriate to assure compliance

with the requirements of the Order.

M. The Interim Monitor appointed pursuant to this Order may be the same person appointed as

a Divestiture Trustee pursuant to the relevant provisions of this Order.

IV.

IT IS FURTHER ORDERED that:

A. If Respondents have not fully complied with the obligations to assign, grant, license, divest,

transfer, deliver or otherwise convey the Specialty Metal Product Assets as required by this

Order, the Commission may appoint a trustee (“Divestiture Trustee”) to assign, grant,

license, divest, transfer, deliver or otherwise convey these assets in a manner that satisfies

the requirements of this Order. In the event that the Commission or the Attorney General

brings an action pursuant to § 5(l) of the Federal Trade Commission Act, 15 U.S.C. § 45(l),

or any other statute enforced by the Commission, Respondent shall consent to the

appointment of a Divestiture Trustee in such action to assign, grant, license, divest, transfer,

deliver or otherwise convey these assets. Neither the appointment of a Divestiture Trustee

nor a decision not to appoint a Divestiture Trustee under this Paragraph shall preclude the

Commission or the Attorney General from seeking civil penalties or any other relief

available to it, including a court-appointed Divestiture Trustee, pursuant to § 5(l) of the

Federal Trade Commission Act, or any other statute enforced by the Commission, for any

failure by Respondents to comply with this Order.

B. The Commission shall select the Divestiture Trustee, subject to the consent of the

Respondents, which consent shall not be unreasonably withheld. The Divestiture Trustee

shall be a Person with experience and expertise in acquisitions and divestitures. If the

Respondents have not opposed, in writing, including the reasons for opposing, the selection

of any proposed Divestiture Trustee within ten (10) days after notice by the staff of the

Commission to Respondents of the identity of any proposed Divestiture Trustee,

Respondents shall be deemed to have consented to the selection of the proposed Divestiture

Trustee.

C. Not later than ten (10) days after the appointment of a Divestiture Trustee, Respondents

shall execute a trust agreement that, subject to the prior approval of the Commission,

transfers to the Divestiture Trustee all rights and powers necessary to permit the Divestiture

Trustee to effect the divestiture required by this Order.
28

D. If a Divestiture Trustee is appointed by the Commission or a court pursuant to this

Paragraph, Respondents shall consent to the following terms and conditions regarding the

Divestiture Trustee’s powers, duties, authority, and responsibilities:

1. Subject to the prior approval of the Commission, the Divestiture Trustee shall have the

exclusive power and authority to assign, grant, license, divest, transfer, deliver or

otherwise convey the assets that are required by this Order to be assigned, granted,

licensed, divested, transferred, delivered or otherwise conveyed.

2. The Divestiture Trustee shall have one (1) year after the date the Commission approves

the trust agreement described herein to accomplish the divestiture, which shall be

subject to the prior approval of the Commission. If, however, at the end of the one (1)

year period, the Divestiture Trustee has submitted a plan of divestiture or the

Commission believes that the divestiture can be achieved within a reasonable time, the

divestiture period may be extended by the Commission; provided, however, the

Commission may extend the divestiture period only two (2) times.

3. Subject to any demonstrated legally recognized privilege, the Divestiture Trustee shall

have full and complete access to the personnel, books, records and facilities related to

the relevant assets that are required to be assigned, granted, licensed, divested, delivered

or otherwise conveyed by this Order and to any other relevant information, as the

Divestiture Trustee may request. Respondents shall develop such financial or other

information as the Divestiture Trustee may request and shall cooperate with the

Divestiture Trustee. Respondents shall take no action to interfere with or impede the

Divestiture Trustee’s accomplishment of the divestiture. Any delays in divestiture

caused by Respondents shall extend the time for divestiture under this Paragraph in an

amount equal to the delay, as determined by the Commission or, for a court-appointed

Divestiture Trustee, by the court.

4. The Divestiture Trustee shall use commercially reasonable efforts to negotiate the most

favorable price and terms available in each contract that is submitted to the

Commission, subject to Respondents’ absolute and unconditional obligation to divest

expeditiously and at no minimum price. The divestiture shall be made in the manner

and to an Acquirer as required by this Order; provided, however, if the Divestiture

Trustee receives bona fide offers from more than one acquiring Person, and if the

Commission determines to approve more than one such acquiring Person, the

Divestiture Trustee shall divest to the acquiring Person selected by Respondents from

among those approved by the Commission; provided further, however, that Respondents

shall select such Person within five (5) days after receiving notification of the

Commission’s approval.

5. The Divestiture Trustee shall serve, without bond or other security, at the cost and

expense of Respondents, on such reasonable and customary terms and conditions as the

Commission or a court may set. The Divestiture Trustee shall have the authority to

employ, at the cost and expense of Respondents, such consultants, accountants,
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attorneys, investment bankers, business brokers, appraisers, and other representatives

and assistants as are necessary to carry out the Divestiture Trustee’s duties and

responsibilities. The Divestiture Trustee shall account for all monies derived from the

divestiture and all expenses incurred. After approval by the Commission of the account

of the Divestiture Trustee, including fees for the Divestiture Trustee’s services, all

remaining monies shall be paid at the direction of Respondents, and the Divestiture

Trustee’s power shall be terminated. The compensation of the Divestiture Trustee shall

be based at least in significant part on a commission arrangement contingent on the

divestiture of all of the relevant assets that are required to be divested by this Order.

6. Respondents shall indemnify the Divestiture Trustee and hold the Divestiture Trustee

harmless against any losses, claims, damages, liabilities, or expenses arising out of, or in

connection with, the performance of the Divestiture Trustee’s duties, including all

reasonable fees of counsel and other expenses incurred in connection with the

preparation for, or defense of, any claim, whether or not resulting in any liability, except

to the extent that such losses, claims, damages, liabilities, or expenses result from gross

negligence, willful or wanton acts, or bad faith by the Divestiture Trustee.

7. The Divestiture Trustee shall have no obligation or authority to operate or maintain the

relevant assets required to be divested by this Order; provided, however, that the

Divestiture Trustee appointed pursuant to this Paragraph may be the same Person

appointed as Interim Monitor pursuant to the relevant provisions of this Order or the

Order to Maintain Assets in this matter.

8. The Divestiture Trustee shall report in writing to Respondents and to the Commission

every sixty (60) days concerning the Divestiture Trustee’s efforts to accomplish the

divestiture.

9. Respondents may require the Divestiture Trustee and each of the Divestiture Trustee’s

consultants, accountants, attorneys and other representatives and assistants to sign a

customary confidentiality agreement; provided, however, such agreement shall not

restrict the Divestiture Trustee from providing any information to the Commission.

E. If the Commission determines that a Divestiture Trustee has ceased to act or failed to act

diligently, the Commission may appoint a substitute Divestiture Trustee in the same manner

as provided in this Paragraph.

F. The Commission or, in the case of a court-appointed Divestiture Trustee, the court, may on

its own initiative or at the request of the Divestiture Trustee issue such additional orders or

directions as may be necessary or appropriate to accomplish the divestiture required by this

Order.
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V.

IT IS FURTHER ORDERED that:

A. Within five (5) days of the Acquisition Date, Respondents shall submit to the Commission a

letter certifying the date on which the Acquisition occurred.

B. Within thirty (30) days after the date this Order is issued, and every sixty (60) days

thereafter until Respondents have fully complied with the following:

1. Paragraphs II.A , II.B., II.C., II.D., II.E., II.F., and II.H.; and

2. all of their responsibilities to render transitional services to the Acquirer as provided by

this Order and the Remedial Agreement(s);

Respondents shall submit to the Commission a verified written report setting forth in

detail the manner and form in which they intend to comply, are complying, and have

complied with this Order. Respondents shall submit at the same time a copy of their

report concerning compliance with this Order to the Interim Monitor, if any Interim

Monitor has been appointed. Respondents shall include in their reports, among other

things that are required from time to time, a full description of the efforts being made to

comply with the relevant Paragraphs of the Order, including a full description of all

substantive contacts or negotiations related to the divestiture of the relevant assets and

the identity of all Persons contacted, including copies of all written communications to

and from such Persons, all internal memoranda, and all reports and recommendations

concerning completing the obligations.

C. One (1) year after the date this Order is issued, annually for the next four (4) years on the

anniversary of the date this Order is issued, and at other times as the Commission may

require, Respondents shall file a verified written report with the Commission setting forth in

detail the manner and form in which it has complied and is complying with the Order.

VI.

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

thirty (30) days prior to:

A. any proposed dissolution of Respondents;

B. any proposed acquisition, merger or consolidation of Respondents; or 

C. any other change in Respondents, including, but not limited to, assignment and the creation

or dissolution of subsidiaries, if such change might affect compliance obligations arising out

of this Order.
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VII.

IT IS FURTHER ORDERED that:

A. Any Remedial Agreement shall be deemed incorporated into this Order.

B. Any failure by Respondents to comply with any term of such Remedial Agreement shall

constitute a failure to comply with this Order. 

C. Respondents shall include in each Remedial Agreement related to each of the Specialty

Metal Products a specific reference to this Order, the remedial purposes thereof, and

provisions to reflect the full scope and breadth of Respondents’ obligations to the Acquirer

pursuant to this Order.

D. Respondents shall also include in each Remedial Agreement a representation from the

Acquirer that the Acquirer shall use commercially reasonable efforts to obtain or achieve

the Product Approvals and Specifications necessary to manufacture and sell, in commercial

quantities, each such Specialty Metal Product and to have any such manufacture and sale to

be independent of Respondents, all as soon as reasonably practicable. 

E. Respondents shall not modify or amend any of the terms of any Remedial Agreement

without the prior approval of the Commission.

VIII.

IT IS FURTHER ORDERED that, for purposes of determining or securing compliance

with this Order, and subject to any legally recognized privilege, and upon written request and

upon five (5) days notice to any Respondent made to its principal United States offices,

registered office of its United States subsidiary, or its headquarters address, Respondent shall,

without restraint or interference, permit any duly authorized representative of the Commission:

A. access, during business office hours of such Respondent 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

such Respondent related to compliance with this Order, which copying services shall be

provided by such Respondent at the request of the authorized representative(s) of the

Commission and at the expense of the Respondent; and

B. to interview officers, directors, or employees of such Respondent, who may have counsel

present, regarding such matters.
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IX.

IT IS FURTHER ORDERED that this Order shall terminate on April 12, 2022.

By the Commission, Commissioner Ohlhausen not participating. 

Donald S. Clark

Secretary

SEAL

ISSUED: April 12, 2012
NON-PUBLIC APPENDIX A

SPECIALTY METAL PRODUCT

DIVESTITURE AGREEMENTS

[Redacted From the Public Record Version, But Incorporated By Reference]