Exhibit
99.1




Portions of this Exhibit 99.1 have been
omitted based upon a request for confidential treatment. This Exhibit 99.1,
including the non-public information, has been filed separately with the
Securities and Exchange Commission “*” designates portions of this document that
have been redacted pursuant to the request for confidential treatment filed with
the Securities and Exchange Commission.
 
 
 PURCHASE AND SALE
AGREEMENT
 
 
 THIS PURCHASE AND
SALE AGREEMENTentered
into on this 4thday of September, 2007, and will be
effective January 1, 2008, is betweenTITANIUM METALS
CORPORATION, a Delaware
corporation with its principal executive office at 3 Lincoln Centre, 5430 LBJ
Freeway, Suite 1700, Dallas, TX 75240-2697, U.S.A. (“TIMET”), on the one hand, andARDOR (UK)
LTD., a company duly
organized and existing under the laws of the United Kingdom, with offices at
Suite 10a Saville Court, Saville Place, Clifton, Bristol BS8 4EJ England
(“ARDOR”) , on the other
hand.
 
 RECITALS
 
 A.           ARDOR
has available to it a stable supply of titanium sponge produced by the
Ust-Kamenogorsk Titanium and Magnesium Plant in Kazakhstan (“UKTMP”).
 
 B.           TIMET
requires a stable supply of titanium sponge to satisfy its raw material
requirements.
 
 C.           ARDOR
desires to sell titanium sponge to TIMET, and TIMET desires to purchase titanium
sponge from ARDOR, on the terms and conditions set forth
hereinafter.
 
 
 NOW,
THEREFORE, in consideration of the premises and mutual covenants herein
contained, the parties hereto agree as follows:
 
 TERMS AND
CONDITIONS
 
 ARTICLE
1
 DEFINITIONS
 
 As used
in this Agreement, the following terms shall have the meaning given each
below:
 
 
 “Affiliate” means, as
to any given person, any corporation, partnership, limited liability company,
trust, incorporated or unincorporated business association, joint venture, joint
stock company, or any other kind of business entity that, directly or
indirectly, controls, is controlled by, or is under common control with such
person.  For purposes of this definition, the term “control”
(including, with correlative meanings, the terms “controlled by” and “under
common control with”), as used with respect to any such entity, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such entity, whether through the
ownership of voting securities, by contract, or otherwise.
 
 “ARDOR” means Ardor
U.K., Ltd., a company incorporated under the laws of Britain and
Wales.
 
 “Calendar Year” means
each year from January 1 to December 31, the first of which is the year of
January 1, 2008, to December 31, 2008.
 
 “Collateral” has the
meaning given such term in Section 3.5.
 
 “Conversion Services
Agreement” has the meaning given such term in Section 6.1
below.
 
 
 “DDU” has the meaning
given to such term by “Incoterms 2000.”
 
 “Product” means
titanium sponge produced by Ust Kamenogorsk Titanium and Magnesium Plant
(“UKTMP”) and owned by ARDOR.
 
 “Purchase Order” has
the meaning given such term in Section 5.1 below.
 
 “Specifications” means
TIMET Raw Material Specification No. 71.8 (Rev. 3) (Premium Grade Titanium
Sponge) or TIMET Raw Material Specification No. 72.8 (Rev. 1) (Standard Grade
Titanium Sponge), as applicable, which Specifications are attached hereto as
Exhibit B-1 and B-2, respectively, as the same may be amended, modified,
supplemented, or restated from time to time by the mutual agreement of TIMET and
ARDOR.
 
 “THT” means Titanium
Hearth Technologies, Inc., a Delaware corporation and a wholly owned subsidiary
of TIMET.
 
 “TIMET” means Titanium
Metals Corporation, a Delaware corporation.
 
 “TIMET Savoie” means
TIMET Savoie, S.A., a French company and an indirect, majority owned subsidiary
of TIMET.
 
 “TIMET UK” means TIMET
UK, Ltd., an English company and an indirect wholly owned subsidiary of
TIMET.
 
 “UKTMP” has the
meaning given such term above in the definition of “Product.”.
 
 “U.S. Bank” means U.S.
Bank National Association.
 
 “U.S Bank Agreement”
means that certain Credit Agreement among U.S. Bank and TIMET (as the same may
be amended form time to time).
 
 
 ARTICLE
2
 SALE AND
PURCHASE
 2.1           On
the terms and subject to the conditions set forth in this Agreement, ARDOR
agrees to sell and deliver Product to TIMET (and to Affiliates of TIMET), and
TIMET agrees to purchase Product from ARDOR.
  
 -1-
 ARTICLE
3
 DELIVERY
 
 3.1Product specified for
delivery to TIMET UK shall be delivered DDU “in warehouse” to the specified
bonded warehouse in the vicinity of TIMET UK’s plant at Birmingham (Witton),
England.
 
 3.2           Product
specified for delivery to TIMET or THT shall be delivered DDU TIMET’s plant at
Henderson, Nevada or DDU THT’s plant at Morgantown, Pennsylvania, as
specifically directed in the Purchase Order.
 
 3.3           Product
specified for delivery to TIMET Savoie shall be delivered DDU when
released  to a carrier selected by TIMET Savoie at a warehouse of
ARDOR’s choosing in Rotterdam, The Netherlands.
 
 3.4           Title
and risk of loss of or damage to Products shall pass from ARDOR to TIMET only
when Product has been delivered to TIMET in accordance with the provisions of
this Article 3.  Product held in a bonded warehouse pending delivery
shall remain the property of ARDOR.
 
 3.5           In
order to secure the payment of any amounts owing by TIMET to ARDOR in respect of
invoices issued by ARDOR for Product delivered by ARDOR to TIMET during the term
of this Agreement, TIMET hereby grants to ARDOR a purchase money security
interest in and to Product acquired from ARDOR under this Agreement but only to
the extent that such Product (a) was delivered by ARDOR to TIMET in the U.S.
during the term of this Agreement and (b) is then owned by and in the actual or
constructive custody or possession of TIMET in the U.S., including such
inventory as is owned by TIMET while in transit (as so limited, the “Collateral”).  Notwithstanding
anything to the contrary in this Agreement or otherwise, the amount secured by
the purchase money security interest granted hereunder shall at all times be
limited in amount to the lesser of (y) the value of Product delivered by ARDOR
to TIMET in the U.S. during the term of this Agreement (based upon the purchase
price then applicable under this Agreement) , and (z) the outstanding unpaid
amount owed by TIMET to ARDOR in respect of invoices issued by ARDOR for Product
delivered by ARDOR to TIMET in the U.S. during the term of this Agreement; provided, however, that for so
long as TIMET is timely in making payment to ARDOR for Product, this purchase
money security interest shall be limited in amount to only those amounts owing
for Product delivered by ARDOR to TIMET that are past due and only in the event
TIMET fails to make any payment by the past due date shall this purchase money
security interest be extended to cover to all unpaid amounts, whether or not
past due.  ARDOR and TIMET agree that (A) such security interest does
not extend to any property of TIMET other than Product delivered by ARDOR to
TIMET in the U.S. during the term of this Agreement, and (B) such security
interest is created in connection with the acquisition by TIMET of Product as
inventory in the ordinary course of TIMET’s business.
 
 3.6           Subject
to the limitations set forth in Section 3.5, TIMET agrees that it will execute,
acknowledge and deliver to ARDOR such financing statements and other documents
reasonably required for ARDOR to establish and maintain a valid and perfected
purchase money security interest in the Collateral.
 
 3.7           Subject
to the limitations set forth in Section 3.5, TIMET agrees that it will, at its
cost and expense, protect and defend ARDOR’s purchase money security interest in
the Collateral against all adverse claims, or claims therein or thereto or any
part thereof, or any interest therein, and will keep such Collateral free from
any other lien, security interest, or encumbrance other than the security
interests granted to (a) U.S. Bank as lender pursuant to the U.S. Bank Agreement
or (b) any successor lender under any replacement credit
facility.  Other than by sale of products of such Collateral, TIMET
will not, without the prior written consent of ARDOR, directly or indirectly
attempt to make, or permit, any further transfer of any interest in any
Collateral in respect of which an invoice from ARDOR to TIMET remains unpaid to
any third person (other than to a subsidiary of TIMET, to U.S. Bank pursuant to
the U.S. Bank Agreement, or to any successor lender pursuant to any replacement
credit facility), including but not limited to, the creation of any further
security interests therein.  TIMET will promptly notify ARDOR of any
threatened or filed claims or proceedings that might in any way adversely affect
or impair ARDOR’s rights in such Collateral or in this Agreement.
 
 3.8           Subject
to the limitation set forth in Section 3.5, upon the occurrence with respect to
TIMET of any event described in Section 8.3 of this Agreement, in addition to
any other remedy provided in this Agreement, ARDOR shall be entitled to all of
the remedies of a secured party under the Uniform Commercial Code as in effect
in the respective states of the United States in which Collateral is located or
under any other applicable United States law to the extent of the security
interest granted pursuant to Section 3.5 above.
 
 3.9           After
the payment in full of all amounts due and payable in respect of invoices for
Product delivered by ARDOR to TIMET in the U.S., the security agreement provided
for in Section 3.5 of this Agreement shall terminate and ARDOR will execute and
deliver to TIMET a proper instrument or instruments (including Uniform
Commercial Code termination statements on form UCC-3) acknowledging the
satisfaction and termination of the security agreement provided for in Section
3.5 of this Agreement.
 
 3.10           In
the event that any part of the Collateral is sold or otherwise disposed of in
connection with a sale or other disposition permitted this Agreement, such
Collateral will be sold free and clear of the of the security interest provided
in Section 3.5 of this Agreement, and ARDOR agrees to duly execute any and all
instruments and take all other actions necessary to permit TIMET to assign,
transfer and deliver such Collateral free and clear of the security interest
provided in Section 3.5 of this Agreement.
 
 3.11           As
to the Product delivered by ARDOR to TIMET in the U.K. and located in the United
Kingdom (or any other country other than the United States), TIMET will endeavor
to provide such further agreements and other documents reasonably requested by
ARDOR in order to evidence and perfect a lien in such Product under the laws of
the applicable foreign jurisdiction, subject to any limitations contained in the
current TIMET UK credit agreement or any replacement credit
facility
 
 -2-
 
 ARTICLE
4
 PRICES &
QUANTITY
 
 4.1           Prices.  Prices
are as follows:
 
 (a)           For
purchases and sales of Product in Calendar Years 2008 and 2009, prices shall be
* per kilogram.
 
 (b)           For
purchases and sales of Product in Calendar Years 2010 through 2015, the price
shall be determined in accordance with Section 4.2(b) below.
 
 (c)           All
prices are subject to the following premium and discount:
 
 (i) For
freight to the United States, a premium of * shall be added to the then
effective price.
 
 (ii) For
“12 by 70” particle size Product, a discount of USD * shall be deducted from the
then effective price.
 
 4.2           Volumes.  Volumes
are as follows:
 
 (a)           For
Calendar Year 2008 and Calendar Year 2009, ARDOR shall sell, and TIMET shall
purchase, * metric tons of Product.
 
 (b)           For
Calendar Years 2010 through 2015, the Parties will meet commencing in June of
the prior Calendar Year (for example, June 2009 for the negotiation
for
 Calendar Year 2010)
to negotiate in good faith prices and volumes for such Calendar Year, subject to
the limitations as follows:
 
 (i)           The
agreed volumes shall be no less than * metric tons of Product and no greater
than * metric tons of Product; and
 
 (ii)           the
agreed price shall be no less than  * per kilogram of
Product  and no greater than * per kilogram of Product exclusive of
any applicable
 premium or
discount under section 4.1(c).
 
 If no
agreement is reached on prices and volumes by September 30 of the prior Calendar
Year, ARDOR shall provide to TIMET its final price (subject to the foregoing
limitations) it is willing to sell Product in the upcoming Calendar Year, and,
within ten (10) days of receipt of the such price, TIMET shall provide ARDOR
with the volume (subject to the foregoing limitations) it is willing to purchase
at such price.
 
 (c)           Without
the prior written consent of TIMET, “12 by 70” particle size Product shall not
exceed (i) for Calendar Years 2008 and 2009, * of the aggregate weight of
material purchased in any Calendar Year and (ii) for each Calendar Year
thereafter during the term of this Agreement, * of the aggregate weight of
material purchased in any Calendar Year.
 
 4.3           Unless
otherwise agreed by TIMET in writing, ARDOR shall be obligated to accept all
Purchase Orders placed by TIMET that are in accordance with the terms of this
Agreement, including the volume limitations set forth in Section
4.2.  TIMET may from time to time desire additional Product above the
volume limitations set forth herein. ARDOR agrees to discuss with TIMET any
request by TIMET for such additional Product if and when requested and to give
serious consideration to such requests.
 
 4.4           Unless
the parties otherwise agree in writing, payment for Product shall be made by
TIMET to ARDOR in U.S. Dollars.  For Product delivered to a location
in the United States, payment shall be due within thirty (30) days after
delivery of Product to TIMET in accordance with Article 3.  For
Product delivered in Europe, payment also shall be due within thirty (30) days
after delivery of the Product to TIMET in accordance with Article
3.  In the event either party is past due on any amounts payable under
this Agreement or the Conversion Services Agreement, as the case may be, the
other party shall be entitled to offset such past due amounts against amounts
payable to the past due party.
 
 ARTICLE
5
 PURCHASE ORDERS
 
 5.1           Notwithstanding
the provisions of Article 4, the actual sale of Product under this Agreement
shall be made by placement of individual Purchase Orders by TIMET (or an
Affiliate of TIMET) with ARDOR (each a “Purchase
Order”).
 
 5.2           
Volumes for each Calendar Year shall be purchased and sold on a reasonably
level-loaded basis throughout the Calendar Year, production schedule permitting,
based upon forecasts and planning documents exchanged between the
Parties.
 
 5.3           Each
Purchase Order shall provide, among other things, the quantity of Product
ordered, the scheduled month of delivery, and the delivery
location.
 
 5.4           Each
Purchase Order shall be deemed to incorporate by reference each of the terms and
conditions set forth in this Agreement.  If there is any conflict or
difference in interpretation between this Agreement and any Purchase Order,
proposal, quotation, confirmation, acknowledgment, acceptance, invoice, or other
document used by the parties to facilitate specific purchases of Product
pursuant to this Agreement, the terms and conditions of this Agreement shall
supersede and be deemed to control over the conflicting or different terms of
such Purchase Order or other document.
  
 -3-
 ARTICLE
6
 CONVERSION SERVICES
AGREEMENT
 
 6.1           Contemporaneously
with entering into this Agreement, the Parties have entered into the Conversion
Services Agreement attached hereto as Exhibit A (the “Conversion Services
Agreement”).  The
Toll Agreement will be effective as of January 1, 2007, and any purchase orders
issued by ARDOR and accepted by TIMET thereunder shall be deemed as governed by
that agreement.
 
 ARTICLE
7
 WARRANTY
 
 7.1           With
respect to all Product delivered by ARDOR to TIMET hereunder, ARDOR warrants to
TIMET that (a) ARDOR is delivering good and valid title to such Product, free
and clear of any lien, security interest, or encumbrance, and (b) all such
Product conforms to the Specifications for such Product.  Any claim
for a breach of the warranties under this Agreement shall be made in writing no
later than twenty-four months following the tender of delivery of Products to
TIMET, after which time any claim for breach of warranty shall be deemed waived
and barred.  This warranty shall run to TIMET, its successors and
customers and their assigns.  EXCEPT FOR THE FOREGOING, NO OTHER
WARRANTY OR REPRESENTATION, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION,
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE, IS MADE BY
ARDOR.
 
 7.2           ARDOR
shall cause UKTMP to inspect all Product delivered by ARDOR hereunder to assure
that such Product complies with the requirements of the Purchase Order in all
material respects and meets the Specifications.  ARDOR shall cause
UKTMP to include with each packing sheet a certification that the Product
shipped therewith complies with the Specifications.
 
 7.3           ARDOR
will promptly notify TIMET when deviations from the applicable Specifications
are discovered or suspected in UKTMP’s processes or for Product already
delivered by ARDOR hereunder that might reasonably be expected to call the
integrity or safety of such Product into question.
 
 7.4           Product
delivered by ARDOR hereunder shall be subject to final inspection and acceptance
by TIMET (or its Affiliate) at destination, notwithstanding any payment or prior
inspection; provided, however, that no such
acceptance shall relieve ARDOR of any of its warranties or obligations set forth
in this Article 7.  TIMET may revoke any prior acceptance of any
Product and have the same rights with regard to such Product as if it had
originally rejected such Product.  Product shall be presumed to have
met the Specifications once it has been melted, in the absence of a
preponderance of evidence produced thereafter by TIMET to the
contrary.
 
 7.5           TIMET
may reject any Product which does not conform with the warranties set forth in
Section 7.1.  TIMET (or its Affiliate) shall, by notice, rejection
tag, or other written communication, notify ARDOR of such
rejection.  With respect to any Product properly rejected hereunder,
TIMET may return such Product to ARDOR, at ARDOR’s expense and risk, for
immediate replacement or other correction, as reasonably determined by TIMET,
and redelivery to TIMET (or its Affiliate).  All replacement and other
corrections and redelivery shall be completed within such time as TIMET may
reasonably require at ARDOR’s expense.  Product required to be
repaired, corrected or replaced shall be subject to inspection and rejection in
the same manner and to the same extent as Product originally delivered under
this Agreement, but only as to the repaired, corrected or replaced part or parts
thereof.
 
 7.6           The
following limitations of liability apply to ARDOR’s performance under this
Agreement:
 
 (i)           Except
for claims for bodily injury or destruction to property of third parties,
Ardor’s total liability for any claim arising from this Agreement shall be
limited to an amount no greater than the price paid for the Product(s) subject
to such claim.
 
 (ii)           EXCEPT
FOR CLAIMS OF THIRD PARTIES (INCLUDING TIMET’s CUSTOMER) FOR BODILY INJURY OR
DESTRUCTION TO PROPERTY, IN NO EVENT SHALL ARDOR BE LIABLE FOR SPECIAL,
INDIRECT, CONSEQUENTIAL OR INCIDENTAL DAMAGES WHETHER ARISING UNDER CONTRACT,
WARRANTY, TORT, NEGLIGENCE, STRICT LIABILITY OR ANY OTHER THEORY OF
LIABILITY.  SUCH DAMAGES INCLUDE, BUT ARE NOT LIMITED TO, LOSS OF
PROFITS, LOSS OF USE OF THE GOODS, DAMAGE TO PROPERTY, AND CLAIMS OF THIRD
PARTIES.
 
 ARTICLE
8
 TERM
 
 8.1           Unless
earlier terminated in accordance with the provisions of this Agreement, the term
of this Agreement shall commence for all Purchase Orders with deliveries of
Product scheduled on or after January 1, 2008 (notwithstanding its actual date
of execution by the parties) and remain in effect until December 31,
2015.  This Agreement shall automatically renew for an additional
five-year period and terminate on December 31, 2020, unless either Party
provides notice of termination to the other Party on or prior to June 30,
2012.  The volume and price provisions set forth in section 4.2 (b)
shall continue in effect during such extended term.
 
 8.2           Any
party may forthwith terminate this Agreement and/or any Purchase Order by notice
to such effect to the other party if any other party commits a material breach
of any of the terms or conditions of this Agreement and/or any Purchase Order
and fails to commence reasonable efforts to remedy same within thirty (30) days,
or fails to remedy the same within ninety (90) days, after notice from the party
not in breach setting out the nature of such breach and demanding that the same
be remedied.  A material breach by either party of any of the terms
and conditions of the Conversion Services Agreement shall at non-breaching
party’s election also be deemed to be a material breach of this
Agreement.
 
 8.3           Any
party may forthwith terminate this Agreement and/or any Purchase Order by notice
to such effect to the other party if bankruptcy, insolvency or reorganization
proceedings, or any other proceedings analogous in nature or effect, are
instituted by or against the other party, or the other party is dissolved or
liquidated, whether voluntarily or involuntarily, or if a receiver or trustee is
appointed for all or for a substantial part of the assets of the other party or
if the other party makes a written assignment for the benefit of its creditors
generally.
 
 8.4           If
this Agreement is terminated for whatever reason, other than an event described
in Section 8.3, the parties hereto shall fulfill all outstanding Purchase Orders
which have not been canceled.
 
 8.5           No
termination or expiration of this Agreement or any part hereof shall (1) release
TIMET from any obligation or liability to pay to ARDOR the amount of any
payments due ARDOR from TIMET at the date of such termination, (2) release any
party from any liability or obligation (including liability or obligation to pay
ARDOR the amount of payments which become due) which at the time of such
termination or expiration has already accrued to such party or which thereafter
may accrue in respect of any act or omission prior to such termination, or (3)
affect in any way the survival of any right, duty or obligation of any party
which is expressly stated elsewhere in this Agreement to survive its
termination, including without limitation Article 9,
“Confidentiality.”
  
 -4-
 ARTICLE
9
 CONFIDENTIALITY
 
 9.1           The
parties hereto consider this Agreement and all of its terms and conditions to be
confidential.  Except as the parties may otherwise agree in writing
and except as otherwise required by law, each of the parties hereto shall keep
confidential and shall not use other than in the performance of this Agreement,
and shall take all reasonable steps to ensure that its employees keep
confidential and not use, except for the purpose for which the information was
provided to such party, all information supplied to such party or which such
party has learned during the negotiations leading to this Agreement or learned
hereafter concerning the business of the other; provided, however, that the
foregoing shall not apply to information already known to the receiving party at
the time of receipt and obtained from sources not subject to any confidentiality
undertaking and information made publicly available other than through the fault
of the receiving party.
 
 9.2           The
obligations set forth in Section 9.1 shall survive the expiration or termination
of this Agreement for a period of five (5) years.
 
 9.3           Nothing
herein shall preclude disclosure of information to the extent that the
disclosure is legally compelled (whether by deposition, interrogatory, request
for documents, subpoena, civil investigative demand or similar process, or
otherwise).  In such event, the receiving party will advise and
consult with the disclosing party prior to any such disclosure, so that the
disclosing party may seek a protective order or other appropriate remedy and/or
waive compliance with this Article 9.  If such protective order or
other remedy is not obtained, or compliance with this Article 9 is waived as
above, the receiving party will disclose only that portion of the confidential
information which the receiving party is advised by counsel is legally required
and the receiving party will exercise reasonable efforts to obtain assurance
that confidential treatment will be accorded such of the confidential
information as is disclosed.  Any disclosure made in accordance with
the provisions of this Section 9.3 shall not be regarded as a breach of the
obligations of the receiving party pursuant to this Agreement.
 
 ARTICLE
10
 FORCE
MAJEURE
 
 10.1           No
party shall be liable for its failure to perform, or any delay in performing,
all or any part of its obligations under this Agreement, or under any Purchase
Order, to the extent that such failure is due to any cause or circumstance
beyond the reasonable control of such party, including without limitation, acts
of God, fire, flood, storms, earthquake, typhoon, tidal wave, laws, governmental
orders, regulations, sanctions or restrictions, war (whether declared or not),
armed conflict, hostilities, mobilization, blockade, embargo, detention,
revolution, riot, or unavailability of transportation.  Force Majeure
shall not include:  (a) the imposition of antidumping or
countervailing duties on Product by the U.S. government; (b) ARDOR’s inability
to secure Product from UKTMP except in the case of any of the events listed
above in this section 10.1; lockout, strike or other labor dispute at UKTMP; or
unforeseen severe plant breakdown at UKTMP (but not including normal scheduled
maintenance); or (c) economic impracticability.  The party claiming
the protection of Force Majeure shall promptly notify the other party hereto, in
writing, as to the nature of the Force Majeure, its commencement date and its
anticipated termination.  Such party shall take all reasonable steps
to resume performance hereunder with the least possible delay.
 
 10.2           If
any of the events set forth in the preceding Section 10.1 occurs and the failure
or delay caused thereby cannot be cured within thirty (30) days, any party may
terminate any Purchase Order affected thereby and the contracted quantity in the
Purchase Order so terminated shall be deemed to have been sold and purchased
only for the purpose of determining whether the required quantity for the
Calendar Year in question has been sold and purchased.
 
 
 ARTICLE
11
 MISCELLANEOUS
 
 11.1           Any
dispute arising out of or in connection with this Agreement and each Purchase
Order, including any question regarding the existence, validity or termination
hereof or thereof, shall be referred to and resolved by final and binding
arbitration under the London Court of International Arbitration (LCIA) Rules,
which Rules are deemed to be incorporated by reference into this
Agreement.  The number of arbitrators shall be three.  Each
of TIMET and ARDOR shall be entitled to select one arbitrator, and such two
arbitrators shall select the third arbitrator.  The seat, or legal
place, of arbitration shall be New York City, New York, U.S.A.  The
language to be used in the arbitral proceedings shall be English.  The
governing law of this Agreement and each Purchase Order shall be the substantive
laws of the State of New York U.S.A.  No consideration shall be given
to New York’s conflict of law rules.  This Agreement and each Purchase
Order exclude the application of the 1980 United Nations Convention on Contracts
for the International Sale of Goods.
 
 11.2           A
good faith effort shall be made to resolve all disputes, controversies, claims
and differences which may arise between the parties out of or in relation to or
in connection with this Agreement and/or any Purchase Order on an amicable
basis.  Both parties hereby agree to submit any such dispute,
controversy, difference, or claim which cannot be amicably resolved to final and
binding arbitration as set forth in Section 11.1.
 
 11.3           This
Agreement constitutes the entire agreement between the parties hereto regarding
the subject matter contained herein and wholly supersedes all previous
negotiations, agreements and commitments, whether formal or informal, oral or
written, with respect to the subject matter hereof.
 
 11.4           This
Agreement shall not be amended, changed or modified in any manner except by an
instrument in writing signed by duly authorized representatives of both parties
hereto.  The parties recognize that, for administrative purposes,
documents such as Purchase Orders, acknowledgments, invoices and similar
documents, may be used during the time this Agreement is in force; in no event,
however, shall any term or condition contained in any such administrative
document be interpreted as amending or modifying the terms of this Agreement,
whether such administrative documents are signed or not, unless it is expressly
stated that such document represents an amendment to this Agreement and such
document is signed by both parties as specified above.
 
 11.5           The
provisions of this Agreement shall be binding upon and inure to the benefit of
each of the parties hereto and their respective successors and
assigns.  No party shall assign, transfer or otherwise dispose of its
rights or obligations under this Agreement or under any Purchase Order, in whole
or in part, without the prior written consent of the other party, except that
this Agreement and any outstanding Purchase Orders may be assigned by either
party to any successor to all or substantially all of the business of such
party.
   -5-
 11.6           No
failure to exercise or delay in exercising any right or remedy under this
Agreement or under any Purchase Order by any party shall operate as a waiver
thereof or of any other right or remedy which such party may have hereunder or
thereunder, nor shall any single or partial exercise of such right or remedy
preclude any further exercise thereof or of any other right or remedy which such
party may have hereunder or thereunder.  The rights and remedies
provided herein are cumulative and not exclusive of any rights and remedies
provided by law, in equity or otherwise.
 
 11.7           In
the event that any provision or any portion of any provision of this Agreement
is determined to be invalid, illegal or unenforceable, such provision or portion
thereof shall be deemed to be deleted from this Agreement and the validity of
the remainder of this Agreement shall remain unaffected thereby; provided, however, that the
parties shall promptly negotiate in good faith as to any adjustments in this
Agreement that may be necessary to make it fair and reasonable.
 
 11.8
              (a)
              All
      notices and other communications under this Agreement shall be in English,
      shall be in writing and shall be addressed as provided
    below:
 
 If to
ARDOR:
 
 Ardor
(UK) Ltd.
 Suite
110a Saville Court
 Saville
Place
 Clifton
 Bristol
BS8 4EJ England
 Fax:
No.:  44 117 973 5489
 
 If to
TIMET:
 
 Titanium
Metals Corporation
 224
Valley Creek Blvd.
 Suite
200
 Exton, PA
19341 U.S.A.
 Attn:
Director, Global Procurement
 Fax No.:
610-968-1319
 
 with a
copy to:
 Titanium
Metals Corporation
 3 Lincoln
Centre
 5430 LBJ
Freeway
 Suite
1700
 Dallas,
TX 75420-2697
 Attn:
General Counsel
 Fax No.:
972-448-1445
 
 (b)
              Such
      notices and communications (properly addressed) shall be deemed given as
      follows:
 (i)           when
personally delivered;
 
 (ii)
              three
      (3) day after deposit with a recognized overnight business delivery
      service; or
 
 (iii)
              when
      sent by verified facsimile to the facsimile number provided in this
      Section 11.8, with original forwarded by regular mail, first class postage
      prepaid, or by recognized document express delivery
    service.
 
 (c)
              Any
      party may change its address or facsimile number by giving notice to the
      others in accordance with the provisions of this Section
    11.8.
 
 11.9           The
headings of this Agreement are inserted for convenient reference only and shall
not affect the construction or interpretation hereof.
 
 11.10         TIMET
and ARDOR shall each be responsible for compliance with all applicable Federal,
State, local and foreign law, ordinances and regulations applicable to its
performance with respect to the subject matter covered hereunder and each party
shall indemnify and save the other party harmless from any and all liability
arising from such party’s non-compliance with any such laws, ordinances and
regulations.  Notwithstanding the foregoing, ARDOR shall not be
required to indemnify TIMET for any antidumping duties or duty deposits that may
be imposed by virtue of the entry of Product into the United
States.
 
 11.11         Neither
party shall make any press release or public announcement regarding this
Agreement without the written consent of the other (which consent will not
unreasonably be withheld), except for any disclosure that may otherwise be
required by law; provided, however, that this
shall not prevent TIMET’s disclosure of this Agreement as determined by TIMET to
be required or appropriate in any filing with the United States Securities and
Exchange Commission or any stock exchange on which the stock of TIMET is
listed.
 
 *   *   *   *   *
 
  -6-
  IN
WITNESS WHEREOF, the parties hereto have caused this Purchase and Sale Agreement
to be executed by their respective duly authorized representatives on the day
and year first above written.
 
 
 TITANIUM
METALS CORPORATION
 
 
 
 By:    
/s/ Steven L.
Watson
  Title: 
C.E.O.
 
 
 
 ARDOR
(UK) LTD.
 
 
 By:    
/s/
illegible
 
 Title:  _____________________________
 
 
 
 
 
  -7-
   Exhibit A to
Exhibit 99.1






CONVERSION SERVICES
AGREEMENT




This CONVERSION SERVICES AGREEMENT
(this “Agreement”), entered into on this 4thday of September, 2007, and will be
effective January 1, 2008, is betweenTITANIUM METALS
CORPORATION, a Delaware
corporation with its principal executive office at 3 Lincoln Centre, 5430 LBJ
Freeway, Suite 1700, Dallas, TX 75240-2697, U.S.A. (“TIMET”), on the one hand, andARDOR (UK)
LTD, a company duly
organized and existing under the laws of the United Kingdom, with offices at
Suite 10a Saville Court, Saville Place, Clifton Bristol BS8 4EJ England
(“ARDOR”) on the other
hand.





RECITALS





A.           TIMET
is in the business of processing and melting titanium raw materials in the form
of titanium scrap and titanium sponge and maintains facilities for such
purpose.





B.           ARDOR
wishes to supply titanium sponge (the “Titanium Sponge”) to TIMET for the
purpose of processing it or equivalent materials into melted titanium products
in the form of 6-4 or commercially-pure titanium ingots (“Titanium Products”),
and TIMET is willing to process the Titanium Sponge and provide ARDOR with
Titanium Products by melting ARDOR’s Titanium Sponge or equivalent titanium raw
materials with the appropriate alloys to produce Titanium Products (the “Toll
Services”).





C.           Contemporaneously
with entering into this Agreement, the Parties have entered into the Purchase
and Sale Agreement for the purchase by TIMET from ARDOR of Titanium Sponge (the
“Sponge Purchase Agreement”) which is separate from the supply of Titanium
Sponge under this Agreement.





D.           TIMET
desires to sell, and ARDOR desires to purchase, the Toll Services on the terms
and conditions of this Agreement.





AGREEMENTS





In consideration of the mutual promises
and the covenants contained in this Agreement, the parties agree to the
following:





1.           Volumes.  (a)
Forecasts; Minimum and
Maximum Volumes.  Exhibit A sets forth for each calendar year
of this Agreement the range of quantities of Titanium Sponge to be supplied by
ARDOR to TIMET to be processed into quantities of Titanium Products to be
provided by TIMET to ARDOR pursuant to this Agreement.  The annual
minimum and annual maximum volume requirements are set forth under the headings
“Annual Minimum” and “Annual Maximum” on Exhibit A.   Commencing
in 2008, in October of each year of this Agreement, ARDOR will provide TIMET
with a forecast for Toll Services for the upcoming calendar year (i.e. October
2008 for 2009 forecast) within the minimum/maximum volume range for that year
with requested deliveries by month.  For 2007, within a reasonable
time after entering into this Agreement, the parties will agree on the volume of
Toll Services to be performed up to a maximum of * metric tons for such
year.  For 2008, the parties have agreed on the volume of Toll
Services to be performed in such year, and such volume is set forth on Exhibit A
and represent a fixed amount not a forecast.  The parties shall use
reasonable efforts to schedule volumes for Toll Services each calendar on a
reasonably level-loaded basis throughout the calendar year, production schedule
permitting, based upon forecasts and planning documents exchanged between the
parties.





(b)  Orders for
Services.  Each order for Toll Services under this Agreement
shall be made by ARDOR on a purchase order executed on behalf of ARDOR which
shall be acknowledged by TIMET on its standard form of acknowledgement (each
order and corresponding acknowledgement referred to herein as a “Purchase
Order”).  The Purchase Order shall state: (a) the quantity of Titanium
Sponge to be tolled, (b) the month in which the Titanium Sponge is to be
received by TIMET, (c) the Titanium Product(s) to be produced for ARDOR by
TIMET, (d) the agreed-to specification for such Titanium Product(s) as
identified on Exhibit D (unless otherwise agreed by TIMET), and (e) when the
Titanium Product(s) are to be delivered to ARDOR by TIMET.  TIMET’s
written acknowledgement of ARDOR’s order shall constitute TIMET’s agreement to
provide the Toll Services and supply the quantities of requested Titanium
Products in accordance with the schedule set out in the Purchase
Order.  Unless agreed by TIMET pursuant to Section 9 herein or
otherwise, TIMET’s is not obligated to acknowledge any order which (i) would
represent a volume in excess of the Annual Maximum (ii) would represent volumes
in excess of the amount of Titanium Products that could be produced based upon
the Titanium Sponge supplied hereunder by ARDOR to the TIMET facility scheduled
to provide the requested Toll Services.




(c)    Product
Specifications.  In addition to the specifications for
individual Titanium Products to be produced under this Agreement, Exhibit D sets
forth the range of products (sizes, widths and specifications) TIMET agrees to
supply under this Agreement.  TIMET undertakes to make reasonable
effort to supply Ardor, when requested, products other than those Titanium
Products specifically individually described in Exhibit D that are within the
product range set out in Exhibit D, provided that any such requests shall not
require TIMET to exceed the volume requirements set forth in Section 1 (unless
agreed by TIMET pursuant to Section 9 hereof).  TIMET will accept
requests for sizes, widths and specifications that are identical to the sizes,
widths and specifications TIMET is then offering to ARDOR’s customers in TIMET’s
direct transactions with such customers.




2.  Terms of Provision of Toll
Services.




(a)  Price.  The
price to be paid for Toll Services performed during this Agreement consists of a
base price plus a premium for vanadium.  For calendar year 2008 and
2009, the base price is * of Titanium Product.  Each calendar year
thereafter, the base price will be set after agreement by the parties to a price
for Titanium Sponge under the Sponge Purchase Agreement. For every * less than *
that TIMET will pay ARDOR for Titanium Sponge thereunder, the base price for
Toll Services shall be reduced by $* (rounded up to the nearest one cent). For
instance, if TIMET and ARDOR agree to a price of * under the Sponge Purchase
Agreement for 2010, then, the base price for Toll Services hereunder shall be
equal to *. The premium for vanadium is calculated twice per calendar year
pursuant to the formulas set forth on Exhibit B.  Prices are EXWORKS
TIMET’s plant (EXW INCOTERMS 2000).




(b)  Payment.  Payments
for Toll Services are due in immediately available funds within thirty (30) days
from the date of TIMET’s invoice for such Toll Services.  TIMET’s
invoice shall be issued when Titanium Products are delivered to ARDOR as
provided herein.  In the event either party is past due on any amounts
payable under this Agreement or the Sponge Purchase Agreement, as the case may
be, the other party shall be entitled to offset such past due amounts against
amounts payable to the past due party.





1
 (c)  Delivery.





(i)  To
TIMET.  ARDOR shall deliver Titanium Sponge to be toll
manufactured under this Agreement to TIMET at a designated TIMET facility, duty
paid and with all customs formalities carried out, and not unloaded from any
arriving means of transport.





(ii)  To
ARDOR.  TIMET shall deliver the Titanium Product(s)
manufactured under this Agreement by placing the Titanium Product(s), packed
ready for shipment with evidence of conformity provided by this Agreement, at
the TIMET’s production facility within the period specified by the order, loaded
aboard the means of transport provided by the carrier nominated by ARDOR or a
logistics company or other person acting on ARDOR’s behalf.





(iii)  TIMET shall inspect
all Titanium Product(s) delivered by TIMET hereunder and shall verify that such
Titanium Products comply with requirements set forth in Exhibit D (or terms or
specifications otherwise agreed to in writing by TIMET pursuant to the specific
terms of an order).  TIMET shall be responsible for all inspections of
the Titanium Product(s) during receiving, manufacture, and TIMET’s final
inspection.  TIMET shall include with each packing sheet a
certification that the product concerned complies with the applicable Exhibit D
specifications.  TIMET shall provide ARDOR copies of any available
test and/or control data developed by TIMET upon request from
ARDOR.





(d)  Title; Risk of
Loss.  After Titanium Sponge is received by TIMET pursuant to
this Agreement and at all times during the performance of Toll Services, ARDOR
shall be the owner of and shall retain title to such Titanium Sponge, provided however
that:




(i)  title
to the ARDOR Titanium Sponge shall transfer to TIMET at such time as the
equivalent Titanium Product is melted;




(ii)  risk
of loss to Titanium Sponge supplied to TIMET by ARDOR pursuant to this Agreement
shall transfer to TIMET at such time as the Titanium Sponge is delivered as
provided by clause 2(c)(i) and it shall remain with TIMET until such time as
equivalent Titanium Product(s) is/are delivered to ARDOR as provided by clause
2(c)(ii), at which time risk of loss to the Titanium Product(s) concerned and
any Titanium Product(s) made with the use of substituted titanium raw materials
as permitted by this Agreement and delivered to ARDOR shall transfer to ARDOR;
and




(iii)  in
the event Titanium Sponge supplied to TIMET is damaged or lost in whole or in
part, following delivery to TIMET, TIMET shall replace it with equivalent
titanium raw materials in time for TIMET to produce and deliver Titanium Product
in accordance with the terms of the acknowledged Purchase Order relating to such
Titanium Sponge.




(e)  Quality;
Warranties.





(i) ARDOR
warrants that all Titanium Sponge supplied to TIMET under this Agreement shall
conform to TIMET Raw Material Specification No. 71.8 (Rev. 3) (Premium Grade
Titanium Sponge) or TIMET Raw Material Specification No. 72.8 (Rev. 1) (Standard
Grade Titanium Sponge), as applicable, which Specifications are attached hereto
as Exhibits C-1 and C-2, respectively, as the same may be amended, modified,
supplemented, or restated from time to time by the mutual agreement of TIMET and
ARDOR.





(ii)  TIMET warrants that all
Titanium Product(s) produced from the Toll Services shall conform to the
description and specifications set forth in, or appended to, this document on
Exhibit D.  This warranty shall survive inspection, test and
acceptance of, and payment for, the Titanium Product(s); provided, however that
any claim for a breach of the warranties under this Agreementshall
be made in writing no later than twenty-four months following tender of delivery
of Titanium Products to ARDOR (or its customer), after which time any claim for
breach of warranty shall be deemed waived and barred.  This warranty
shall run to ARDOR, its successors, and customers and their
assignees.  Titanium Products required to be repaired, corrected or
replaced shall be subject to inspection and rejection in the same manner and to
the same extent as Titanium Products originally delivered under this Agreement,
but only as to the repaired, corrected or replaced part or parts
thereof.  Even if the parties disagree about the existence of a breach
of this warranty, TIMET shall promptly comply with ARDOR’s direction to: (i)
repair, rework or replace the Titanium Products, or (ii) furnish any materials
or parts and installation instructions required to successfully repair, correct
or replace any defect or nonconformance of a Titanium Product.  If the
parties later determine that TIMET did not breach this warranty, the parties
shall equitably adjust the invoiced amounts.





(iii)  TIMET
shall promptly notify ARDOR when deviations from the applicable specifications
on Exhibit D are discovered in TIMET’s processes or Titanium Products and shall
provide the following information to the extent known:





A.
            Affected
      process and/or Titanium Product(s) concerned, including product
      designation or description;


B.
            Description
      of the problem (i.e., what it is and
      what it should be);


C.
            Quantity
      and dates delivered; and


D.
            Known
      or suspected affected lots, shipping codes, or other identifying
      designations.





(iv)  Titanium
Product(s) delivered by TIMET hereunder shall be subject to final inspection and
acceptance by ARDOR (or its customer) at destination, notwithstanding any
payment or prior inspection; provided, however,
that no such acceptance shall relieve TIMET of any of its warranties set forth
in this section 2(e).  ARDOR may revoke any prior acceptance of any
Titanium Product(s) and have the same rights with regard to such Titanium
Product(s) as if it had originally rejected such Titanium
Product(s).   Titanium Product shall be presumed to have met the
applicable Exhibit D specifications once it has been melted or otherwise
subjected to further manufacturing operations, in the absence of a preponderance
of evidence produced thereafter by ARDOR or its customer to the
contrary.





(v)  ARDOR
may reject any Titanium Product which does not conform with the warranties set
forth in this section 2(e) within the time period of Section
2(e)(ii).  ARDOR (or its customer) shall by notice, rejection tag, or
other written communication, notify TIMET of such rejection.  With
respect to any Titanium Product properly rejected hereunder, ARDOR may return
such Titanium Product to TIMET, at TIMET’s expense and risk, for immediate
replacement or other correction, as reasonably determined by ARDOR, and
redelivery to ARDOR.  All replacement and other corrections and
redelivery shall be completed within such time as ARDOR may reasonably require,
at TIMET’s expense.






2


(vi)           EXCEPT
FOR THE FOREGOING WARRANTIES, NO OTHER WARRANTY OR REPRESENTATION, EXPRESS OR
IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF MERCHANTIBILITY OR OF
FITNESS FOR ANY PARTICULAR PURPOSE, IS MADE BY EITHER PARTY.





(f)  Limitations of
Liability.  The following limitations of liability apply to
TIMET’s performance under this Agreement:





(i)           Except
for claims for bodily injury or destruction to property of third parties,
TIMET’s total liability for any claim arising from this Agreement shall be
limited to an amount no greater than the price paid for the Toll Services for
the applicable Titanium Product(s) subject to such claim.





(ii)           EXCEPT
FOR CLAIMS OF THIRD PARTIES (INCLUDING ARDOR’s CUSTOMER) FOR BODILY INJURY OR
DESTRUCTION TO PROPERTY, IN NO EVENT SHALL TIMET BE LIABLE FOR SPECIAL,
INDIRECT, CONSEQUENTIAL OR INCIDENTAL DAMAGES WHETHER ARISING UNDER CONTRACT,
WARRANTY, TORT, NEGLIGENCE, STRICT LIABILITY OR ANY OTHER THEORY OF
LIABILITY.  SUCH DAMAGES INCLUDE, BUT ARE NOT LIMITED TO, LOSS OF
PROFITS, LOSS OF USE OF THE GOODS, DAMAGE TO PROPERTY, AND CLAIMS OF THIRD
PARTIES.





(g)           Conflicting
Terms.  Any terms, provisions or conditions contained in
proposals, quotations, purchase orders, confirmations, acknowledgments,
acceptances, invoices or similar documents used by the parties to facilitate
specific purchases of Toll Services pursuant to this Agreement that conflict
with or are different from the terms, provisions or conditions of this
Agreement, shall have no applicability with respect to the purchase and sale of
Toll Services hereunder and shall be deemed objected to by the other party;
provided, however, that specific information covering quantities of Titanium
Products and Toll Services, delivery dates and methods of transportation
consistent with this Agreement shall apply, as shall additional terms
specifically agreed to by the parties in writing.





3.           Confidential
Information. (a) The parties hereto consider this Agreement and all of
its terms and conditions to be confidential.  Except as the parties
may otherwise agree in writing and except as otherwise required by law, each of
the parties hereto shall keep confidential and shall not use other than in the
performance of this Agreement, and shall take all reasonable steps to ensure
that its employees keep confidential and not use, except for purposes of
carrying out this Agreement, all information supplied to it by the other party
or which such party has learned during the negotiations leading to this
Agreement or learned hereafter concerning the business of the other; provided, however, that the
foregoing shall not apply to information already known to the receiving party at
the time of receipt and obtained from sources not subject to any confidentiality
undertaking and information made publicly available other than through the fault
of the receiving party.





(b)           The
obligations set forth in Section 3(a) shall survive the expiration or
termination of this Agreement for a period of five (5) years.





(c)           Nothing
herein shall preclude disclosure of information to the extent that the
disclosure is legally compelled (whether by deposition, interrogatory, request
for documents, subpoena, civil investigative demand or similar process, or
otherwise).  In such event, the receiving party will advise and
consult with the disclosing party prior to any such disclosure, so that the
disclosing party may seek a protective order or other appropriate remedy and/or
waive compliance with this Section 3.  If such protective order or
other remedy is not obtained, or compliance with this Section3 is waived as
above, the receiving party will disclose only that portion of the confidential
information which the receiving party is advised by counsel is legally required
and the receiving party will exercise reasonable efforts to obtain assurance
that confidential treatment will be accorded such of the confidential
information as is disclosed.  Any disclosure made in accordance with
the provisions of this Section 3(c) shall not be regarded as a breach of the
obligations of the receiving party pursuant to this Agreement.





4.           Waiver.  The
failure of either party to insist, in any one or more instances, upon
performance of the terms or conditions of this Agreement shall not be construed
as a waiver or a relinquishment of any right granted hereunder or of the future
performance of any such term, covenant or condition.




5.           Term and
Termination.  (a) Unless earlier terminated in accordance with
the provisions of this Agreement, the term of this Agreement shall commence for
all Purchase Orders with deliveries of Product scheduled on or after January 1,
2008 (notwithstanding its actual date of execution by the parties) and remain in
effect until December 31, 2015.  This Agreement shall automatically
renew for a five-year period and terminate on December 31, 2020, unless either
Party provides notice of termination to the other Party on or prior to June 30,
2012.  The volume provisions specified in Section 1(a) and Exhibit A
for Calendar Year 2015 shall remain in effect for each year during such extended
term and price provisions set forth in Section 2(a) shall remain in effect for
such extended term.





(b)           Any
party may forthwith terminate this Agreement and/or any Purchase Order by notice
to such effect to the other party if any other party commits a material breach
of any of the terms or conditions of this Agreement and/or any Purchase Order
and fails to commence reasonable efforts to remedy same within thirty (30) days,
or fails to remedy the same within ninety (90) days, after notice from the party
not in breach setting out the nature of such breach and demanding that the same
be remedied.  A material breach of any of the terms and conditions by
ARDOR under the Sponge Purchase Agreement shall also be deemed a material breach
of this Agreement.





(c)           Any
party may forthwith terminate this Agreement and/or any Purchase Order by notice
to such effect to the other party if bankruptcy, insolvency or reorganization
proceedings, or any other proceedings analogous in nature or effect, are
instituted by or against the other party, or the other party is dissolved or
liquidated, whether voluntarily or involuntarily, or if a receiver or trustee is
appointed for all or for a substantial part of the assets of the other party or
if the other party makes a written assignment for the benefit of its creditors
generally.





(d)           If
this Agreement is terminated for whatever reason, other than an event described
in Section 5(c), the parties hereto shall fulfill all outstanding Purchase
Orders which have not been canceled.




3


6.           Effect of
Termination.




(a)  General.  No
termination or expiration of this Agreement or any part hereof shall (1) release
ARDOR from any obligation or liability to pay to TIMET the amount of any
payments due TIMET from ARDOR at the date of such termination, (2) release any
party from any liability or obligation which at the time of such termination has
already accrued to such party or which thereafter may accrue in respect of any
act or omission prior to such termination, or (3) affect in any way the survival
of any right, duty or obligation of any party which is expressly stated
elsewhere in this Agreement to survive its termination, including without
limitation Section 3, “Confidentiality.”  Upon the expiration or
earlier termination of this Agreement, TIMET shall package and deliver to ARDOR,
all previously completed Titanium Products subject to valid outstanding Purchase
Orders under this Agreement and all ARDOR-owned Titanium Sponge in its
possession.




(b)Upon
ARDOR’s Breach.  If the early termination
of this Agreement is due to ARDOR’s breach, such packaging and delivery will be
at ARDOR’s expense.




(c)  Upon TIMET’s
Breach.  If the early termination of this Agreement is due to
TIMET’s breach, such packaging and delivery shall be at TIMET’s expense (as
shall be the case if this Agreement expires at the end of its term, as the same
may be extended from time to time).




7.           Acknowledgement of Raw
Material Mix.  The parties recognize and acknowledge that TIMET
will not segregate the Titanium Sponge provided hereunder from other titanium
raw materials of a like quality at TIMET’s facility and that TIMET may, at its
discretion, during the performance of Toll Services substitute other raw
material for the Titanium Sponge provided only that the Titanium Product meets
the warranties of Section 2(e).




8.           Drawback.  TIMET
hereby conveys to ARDOR (or to any other entity designated by ARDOR) all TIMET’s
right to claim, and all its other rights and interest in, any and all customs
duty drawback that may be claimed on the exportation of Titanium Products
subject to this Agreement or articles made with the use of such Titanium
Products whether such Titanium Products were made with the use of Titanium
Sponge provided by ARDOR under this Agreement or with the use of equivalent
titanium raw materials substituted by TIMET for such Titanium
Sponge.





9.           Additional Conversion
Services. ARDOR may from time to time desire additional conversion
services for quantities or types of Titanium Products (such as compacted sponge
and/or single melted electrodes) in addition to the quantities and types of
Titanium Products provided for herein. TIMET agrees to discuss with ARDOR any
request by ARDOR for such additional conversion services if and when requested
and to give serious consideration to such requests.





10.           Documents.





(a)  TIMET shall comply with
all applicable recordkeeping requirements imposed by Part 191 of the Regulations
of US Customs and Border Protection (CBP) and Department of Homeland Security
(19 CFR part 191) and shall timely prepare and retain such other inventory and
other records, and prepare such certificates, letters and other documents, as
may reasonably be required by ARDOR or its customers for the preparation and
verification of claims for drawback of customs duties paid on the importation of
Titanium Sponge supplied by ARDOR under this Agreement upon the exportation of
articles made with the use of such sponge or equivalent materials or with the
use of drawback products made with the use of such sponge or
materials.  TIMET shall cooperate with any audit conducted by CBP of
any drawback claim filed with respect to duties paid on Titanium Sponge supplied
pursuant to this Agreement.





(b)  TIMET shall retain all
documents referred to in Section 10(a) above relating to the transactions
contemplated by this Agreement for a period of not less than twelve (12) years
from the date of such document’s creation.





11.           No
Assignment.  The provisions of this Agreement shall be binding
upon and inure to the benefit of each of the parties hereto and their respective
successors and assigns.  No party shall assign, transfer or otherwise
dispose of its rights or obligations under this Agreement or under any Purchase
Order, in whole or in part, without the prior written consent of the other
party, except that this Agreement and any outstanding Purchase Orders may be
assigned by either party to any successor to all or substantially all of the
business of such party.





12.           Force
Majeure.  If the performance by either party of its obligations
under this Agreement is prevented, restricted or interfered with by any act of
God, fire or other casualty or accident, war or violence, or any law, order,
proclamation, ordinance, demand or requirement of any governmental agency
(“Events of Force Majeure”), such party shall promptly give the other party
written notice thereof, setting forth in such notice the date of the
commencement of the Event of Force Majeure.  Events of Force Majeure
shall not include:  (a) TIMET’s inability to procure raw materials
from usual sources (except for a failure by ARDOR to supply Titanium Sponge),
(b) conflicting scheduling demands or capacity constraints in TIMET’s melting
facilities or (c) economic impracticability.  The existence of the
Event of Force Majeure shall justify the suspension of performance hereunder by
such party and will extend the time for such performance for a period equal to
the period of delay; provided, however, that if such period of delay exceeds
thirty (30) days from the date of commencement of the Event of Force Majeure,
the other party may terminate this Agreement immediately upon written
notice.




13.           Entire
Agreement.  This Agreement, together with all Exhibits
incorporated into this Agreement, contains the entire understanding of the
parties with respect to the subject matter of this Agreement.  This
Agreement supersedes all prior agreements, whether oral or written, and all
other communications between the parties concerning the subject of this
Agreement.





14.           Severability.  In
the event that any provision of this Agreement shall be held to be invalid or
unenforceable for any reason, the parties agree that such invalidity or
enforceability shall not affect any other provision of this Agreement and the
remaining covenants, restrictions and provisions shall remain in full force and
effect to the extent permitted by governing law.





15.           Governing Law;
Disputes. (a) Any dispute arising out of or in connection with this
Agreement and each Purchase Order, including any question regarding the
existence, validity or termination hereof or thereof, shall be referred to and
resolved by final and binding arbitration under the London Court of
International Arbitration (LCIA) Rules, which Rules are deemed to be
incorporated by reference into this Agreement.  The number of
arbitrators shall be three.  Each of TIMET and ARDOR shall be entitled
to select one arbitrator, and such two arbitrators shall select the third
arbitrator.  The seat, or legal place, of arbitration shall be New
York City, New York, U.S.A.  The language to be used in the arbitral
proceedings shall be English.  The governing law of this Agreement and each
Purchase Order shall be the substantive laws of the State of New York
U.S.A.  No consideration shall be given to New York’s conflict of law
rules.  This Agreement and each Purchase Order exclude the application
of the 1980 United Nations Convention on Contracts for the International Sale of
Goods.





4


(b)           A
good faith effort shall be made to resolve all disputes, controversies, claims
and differences which may arise between the parties out of or in relation to or
in connection with this Agreement and/or any Purchase Order on an amicable
basis.  Both parties hereby agree to submit any such dispute,
controversy, difference, or claim which cannot be amicably resolved to final and
binding arbitration as set forth in Section 15(a).





16.           Notices.  Any
notice given under this Agreement shall be deemed sufficient if addressed in
writing and delivered by verified facsimile (with the original forwarded by
regular mail, first class postage prepaid, or by recognized document express
delivery service), any recognized document express delivery service or
personally to the principal business office of the other party listed in the
preamble of this Agreement or provided by notice in writing from time to
time.





17.           Amendment.  This
Agreement may only be amended by an agreement in writing signed by all the
parties to this Agreement.





18.           SectionHeadings.  Section
headings are solely for the convenience of the reader and are not intended for
interpretation or construction of this Agreement.











[The remainder of the page
is intentionally left blank.]





5





IN WITNESS WHEREOF, this Agreement is
executed on behalf of the parties hereto as of the date first hereinabove set
forth.








ARDOR
(UK) LTD








By:     
/s/ illegible Name: Title:








TITANIUM
METALS CORPORATION








By:     
/s/ Steven L.
Watson


Name: Steven L.
Watson


Title:   C.E.O.





6








EXHIBIT A: Initial Volume
Forecast, Annual Minimum, Annual Maximum











Calendar
      Year
            Annual
      Minimum (metric tons)
            Annual
      Maximum (metric tons)2007
            *
            *2008
            *
            *2009
            *
            *2010
            *
            *2011
            *
            *2012
            *
            *2013
            *
            *2014
            *
            *2015
            *
            *








7





EXHIBIT B: Vanadium
Premium








*






























































NOTES:





A.           TIMET
shall calculate the vanadium adder twice per calendar year.  First, on
May 15th, using
the four-month average of the preceding January through April time period, and
the adder will apply in the upcoming July 1 through December 31
period.  Second on November 15th, using
the four-month average from July through October, and the adder will apply in
the upcoming January 1 through June 30period.





B.           In
the event Ryan’s Notes ceases to publish the information for vanadium pentaoxide
prices, the Parties may substitute an alternative source as they may reasonably
agree.








8





Exhibit
C-1 to Exhibit A


of
Exhibit 99.1





SPECIFICATIONS FOR PREMIUM
GRADE SPONGE





TIMET Raw Material
Specification 71.8 (Rev. 3)




1
            SCOPE




1.1
            This
      specification covers premium grade titanium sponge for conversion to
      semi-fabricated parts.




1.2
            Titanium
      sponge to this specification shall be made by the Kroll process of
      Magnesium Reduction of Titanium Tetrachloride followed by Vacuum
      Distillation.




1.3
            Titanium
      sponge applied to this specification shall be made in accordance with a
      method of manufacture approved by TIMET.  No change shall be
      made in the approved method of manufacture without prior consultation with
      TIMET.




1.4
            The
      method of manufacture shall clearly detail the provision to deal with fire
      affected lots at all stages of processing and shall be agreed by
      TIMET.




2
            ACKNOWLEDGEMENT




The
manufacturer, defined throughout this specification as the supplier, shall
explicitly incorporate this specification, RMS 71.8, and revision number, in all
quotations, certifications and acknowledgements.




3
            APPLICABLE
      DOCUMENTS




3.1
            TIMET
      RMS 1000, Critical
      Aerospace Application Raw Materials Quality Systems
      Requirements.




3.2
            PWA
      1201, Titanium
      Sponge.




4
            TECHNICAL
      REQUIREMENTS




4.1
            Composition




Material
      shall conform to the percentages by weight shown in Table
      I.  Determination shall be by wet chemical methods in accordance
      with ASTM E120, by spectro-chemical methods or by other analytical methods
      acceptable to TIMET.


4.2




4.3
            Table I: Chemical
      Analysis




The
      following elements shall be determined analytically and shall not exceed
      the limits detailed below.  Titanium content shall not be less
      than *.




MaxFe
              *Cl
              *Mn
              *N
              *C
              *H*
              *O
              *Si
              *Cr*
              *Al*
              *Ni*
              *Mg*
              *Sn*
              *Water*
              *Other*
              *Other
      Total*
              *Titanium*
              remainder


* Need
not be analysed; can be guaranteed.  Results of analysis may be
rounded to the last figure shown in Table.




4.4
            Physical
      Form




4.4.1
            *.




*
            *
            **             8%
      max
              *        84% min
              *           8%
      max
            *               8%
      max
              *          90%
      min
              *               2%
      max
            *             5%
      max
              *          5%
      min
              *                Balance
              *             Nil




4.4.2
            The
      maximum Brinell hardness shall be
*.




4.4.3
            *.






9




4.5
            Sampling




A
representative sample shall be obtained by separating a representative portion
of the material during mixing of the lot before packaging.  The sample
size shall be determined by the approved process plan.  The sample
size that is sent to the customer and extracted from the representative portion
shall be 5kg and this shall be sent with the lot.




A slice
of the manufacturer’s evaluation ingot/button shall be sent with the batch only
when requested by the customer.  The slice shall be attached to the
outside of the drum.




4.6
            Quality




4.6.1
            *.




4.6.2
            Sponge
      particles from each lot or blend shall be 100% visually inspected to
      remove any particle of unusual color and physical
      appearance.  Nitrogen content of any such segregated particle
      shall be determined.




4.6.3
            No
      sponge batch or lot shall be used when the nitrogen content of any
      particle analysed as in 4.5.2 exceed
*.




4.6.4
            No
      sponge shall be used which has been subjected to a fire or has been
      produced in equipment which has experienced a fire until that equipment
      has been cleaned, inspected for damage and has produced sponge not used
      for product meeting this
specification.




4.6.5
            Specific
      procedures must be available detailing how any material under 4.5.4 is
      dealt with.




4.6.6
            Specific
      procedures must be available dealing with control of any dense metal
      tools, which are used in the processing/inspection areas, e.g., tungsten
      or tungsten carbide.




4.6.7
            *.




4.6.8
            *.




4.6.9
            Every
      effort shall be made to keep 4.5.7 and 4.5.8 to a minimum and dispatch all
      the lots from cake in one shipment.




4.7
            Receiving
      inspection




Titanium
sponge received by the purchaser which, subsequent tests and analysis show not
to be in accordance with this specification, shall be subject to rejection or
replacement free of charge.  All material shall undergo a full visual
inspection as agreed with the purchaser and any lots which contains a colored
particle of greater than * nitrogen shall be rejected.




4.8
            Lots




Titanium
sponge shall be supplied in homogeneous lots, which shall be allocated an
individual identification.  A lot is defined as a number of drums
which have been filled at anytime in such a manner that the chemical
composition, particle size distribution and hardness of the contents of each
drum are adequately covered by one set of samples and test
certificates.  Any lots with a duplicated number will be
returned.






5
            IDENTIFICATION




The body
of each drum (not the lid) shall be legibly marked in characters at least 30mm
high with a description of the material, the lot number and the drum
number.





6
            PACKAGING




6.1
            *.




6.2
            *.





7
            SHIPPING




7.1
            Within
      each delivery, the drums shall be arranged in order of lot and drum
      number.




7.2
            The
      method of packing and delivery shall not be altered without the prior
      agreement of TIMET.




7.3
            The
      sample required by section 4.4 of the specification shall be included in
      drum one (1) of the lot and the slice from the ingot/button shall be
      attached to the outside of the
drum.






10





8
            CERTIFICATION




8.1
            Unless
      otherwise specified, the supplier shall send to the Quality Manager of the
      TIMET site, prior to, or at the time of despatch, documents showing the
      following:




8.2
            Test
      report in duplicate stating the TIMET specification and grade
      giving:




8.2.1
            Chemical
      analyses




8.2.2
            Hardness
      of each lot




8.2.3
            Particle
      size analysis




8.2.4
            Bulk
      density of each lot




8.2.5
            A
      statement that each lot conforms to PWA 1201 and this
      specification.




8.3
            A
      copy of the test report shall also be included in drum one (1) of the
      lot.






9
            NON-CONFORMANCE




TIMET
shall be entitled to reject the whole lot if the lot is not in accordance with
this specification or RMS 1000.






10
            QUALITY
      ASSURANCE




In
accordance to the requirements defined in RMS 1000, the method of manufacture
shall include, but is not limited to, the following parameters:





10.1
            Source
      or method of producing raw materials, i.e., magnesium, titanium
      tetrachloride




10.2
            Size
      of reaction pots




10.3
            Method
      of reactant additions




10.4
            Process
      control of reaction, temperatures, vacuum and leak
    detection




10.5
            Method
      of cake removal




10.6
            Dressing,
      classifying crushing of cake




10.7
            Sampling
      procedures




10.8
            In-process
      testing and hand sorting (visual
inspection)




10.9
            Final
      inspection and certification.






11
            OTHER
      CRITERIA




11.1
            The
      order of precedence shall be any applicable agreements between TIMET and
      the customer, the requirements listed on the TIMET Purchase Order or
      contract, RMS 71.8 (latest revision) and RMS 1000 (latest
      revision).




11.2
            All
      material shall satisfy the requirements of PWA 1201 (latest
      revision).




12
            APPENDIX




None.






REVISION
HISTORY:




Revision
      3:
            Sep
      01
            Minor
      amendments to existing revision; reference to Grade 1
    removed.




Revision
      2:
            Jun
      01
            This
      RMS was revised to include only Grade 1-sponge
    requirements.




Revision
      1:
            Feb
      98
            Original
      issue.













11





Exhibit
C-1.1 to Exhibit A


of
Exhibit 99.1





SPECIFICATIONS FOR STANDARD
GRADE SPONGE





TIMETRAW MATERIAL SPECIFICATION
72.8 (REV. 1)







SCOPE




1.1
            This
      specification covers standard grade titanium sponge for conversion to
      semi-fabricated parts.




1.2
            Titanium
      sponge to this specification shall be made by the Kroll process of
      Magnesium Reduction of Titanium Tetrachloride followed by Vacuum
      Distillation.




1.3
            Titanium
      sponge applied to this specification shall be made in accordance with a
      method of manufacture approved by TIMET.  No change shall be
      made in the approved method of manufacture without prior consultation with
      TIMET.




1.4
            The
      method of manufacture shall clearly detail the provision to deal with fire
      affected lots at all stages of processing and shall be agreed by
      TIMET.




ACKNOWLEDGEMENT




The
manufacturer, defined throughout this specification as the supplier, shall
explicitly incorporate this specification, RMS 72.8, and revision number, in all
quotations, certifications and acknowledgements.




APPLICABLE
      DOCUMENTS




TIMET RMS
1000, Critical Aerospace
Application Raw Materials Quality Systems Requirements.




TECHNICAL
      REQUIREMENTS




4.1
            Composition




Material
      shall conform to the percentages by weight shown in Table
      I.  Determination shall be by wet chemical methods in accordance
      with ASTM E120, by spectro-chemical methods or by other analytical methods
      acceptable to TIMET.







4.2
            Table I: Chemical
      Analysis




The
      following elements shall be determined analytically and shall not exceed
      the limits detailed below.  Titanium content shall not be less
      than *.




MaxFe
              *Cl
              *Mn
              *N
              *C
              *H*
              *O
              *Si
              *Cr*
              *Al*
              *Ni*
              *Mg*
              *Sn*
              *Water*
              *Other*
              *Other
      Total*
              *Titanium*
              remainder




* Need
not be analysed; can be guaranteed.  Results of analysis may be
rounded to the last figure shown in Table.




4.3
            Physical
      Form




4.3.1
            *.




*
            *
            **             8%
      max
              *            84%
      min
              *           8%
      max
            *               8%
      max
              *          90%
      min
              *               2%
      max
            *             5%
      max
              *          5%
      min
              *                Balance
              *             Nil




4.3.2
            The
      maximum Brinell hardness shall be
*.




4.3.3
            *.






12




4.4
            Sampling




A
representative sample shall be obtained by separating a representative portion
of the material during mixing of the lot before packaging.  The sample
size shall be determined by the approved process plan.  The sample
size that is sent to the customer and extracted from the representative portion
shall be 5kg and this shall be sent with the lot.




A slice
of the manufacturer’s evaluation ingot/button shall be sent with the batch only
when requested by the customer.  The slice shall be attached to the
outside of the drum.




4.5
            Quality




4.5.1
            *.




4.5.2
            Sponge
      particles from each lot or blend shall be 100% visually inspected to
      remove any particle of unusual color and physical
      appearance.  Nitrogen content of any such segregated particle
      shall be determined.




4.5.3
            No
      sponge batch or lot shall be used when the nitrogen content of any
      particle analysed as in 4.5.2 exceed
*.




4.5.4
            No
      sponge shall be used which has been subjected to a fire or has been
      produced in equipment which has experienced a fire until that equipment
      has been cleaned, inspected for damage and has produced sponge not used
      for product meeting this
specification.




4.5.5
            Specific
      procedures must be available detailing how any material under 4.5.4 is
      dealt with.




4.5.6
            Specific
      procedures must be available dealing with control of any dense metal
      tools, which are used in the processing/inspection areas, e.g., tungsten
      or tungsten carbide.




4.5.7
            Every
      effort shall be made to keep a) number of batches per lot and b) number of
      lots incorporating the same sponge batch to a minimum and despatch all the
      lots from a cake in one shipment.




4.6
            Inspection




Titanium
sponge received by the purchaser which, subsequent tests and analysis show not
to be in accordance with this specification, shall be subject to rejection or
replacement free of charge.  All material shall undergo a full visual
inspection as agreed with the purchaser and any lots which contains a colored
particle of greater than * nitrogen shall be rejected.




4.7
            Lots




Titanium
sponge shall be supplied in homogeneous lots, which shall be allocated an
individual identification.  A lot is defined as a number of drums
which have been filled at anytime in such a manner that the chemical
composition, particle size distribution and hardness of the contents of each
drum are adequately covered by one set of samples and test
certificates.  Any lots with a duplicated number will be
returned.




IDENTIFICATION
  The body of each drum (not the lid) shall be legibly marked in characters at
least 30mm high with a description of the material, the lot number and the drum
number.
 
 PACKAGING
  6.1
              *.
  6.2
              *.




13




SHIPPING




7.1
            Within
      each delivery, the drums shall be arranged in order of lot and drum
      number.




7.2
            The
      method of packing and delivery shall not be altered without the prior
      agreement of TIMET.




7.3
            The
      sample required by section 4.4 of the specification shall be included in
      drum one (1) of the lot and the slice from the ingot/button shall be
      attached to the outside of the
drum.





CERTIFICATION




8.1
            Unless
      otherwise specified, the supplier shall send to the Quality Manager of the
      TIMET site, prior to, or at the time of despatch, documents showing the
      following:




8.2
            Test
      report in duplicate stating the TIMET specification and grade
      giving:




8.2.1
            Chemical
      analyses




8.2.2
            Hardness
      of each lot




8.2.3
            Particle
      size analysis




8.2.4
            Bulk
      density of each lot




8.2.5
            A
      statement that each lot conforms to this
  specification.




8.3
            A
      copy of the test report shall also be included in drum one (1) of the
      lot.






NON-CONFORMANCE




TIMET
shall be entitled to reject the whole lot if the lot is not in accordance with
this specification or RMS 1000.






QUALITY
      ASSURANCE




In
accordance to the requirements defined in RMS 1000, the method of manufacture
shall include, but is not limited to, the following parameters:





10.1
            Source
      or method of producing raw materials, i.e., magnesium, titanium
      tetrachloride




10.2
            Size
      of reaction pots




10.3
            Method
      of reactant additions




10.4
            Process
      control of reaction, temperatures, vacuum and leak
    detection




10.5
            Method
      of cake removal




10.6
            Dressing,
      classifying crushing of cake




10.7
            Sampling
      procedures




10.8
            In-process
      testing and hand sorting (visual
inspection)




10.9
            Final
      inspection and certification.






OTHER
      CRITERIA




The order
of precedence shall be any applicable agreements between TIMET and the customer,
the requirements listed on the TIMET Purchase Order or contract, RMS 72.8
(latest revision) and RMS 1000 (latest revision).






APPENDIX




None.






REVISION
HISTORY:




Revision
      1:
            Sep
      01
            Minor
      amendments to existing revision.




Revision
      0:
            Jun
      01
            Original
      issue.





















14





EXHIBIT
D:  SPECIFICATIONS FOR FINISHED TITANIUM PRODUCT





Ardor to
provide list of 6-4 and C-P ingot specifications it would like to be tolled,
subject to TIMET approval








*








15




Exhibit B-1 to Exhibit
99.1
 
 SPECIFICATIONS FOR PREMIUM
GRADE SPONGE
 
 TIMET Raw Material
Specification 71.8 (Rev. 3)
  1
              SCOPE
  1.1
              This
      specification covers premium grade titanium sponge for conversion to
      semi-fabricated parts.
  1.2
              Titanium
      sponge to this specification shall be made by the Kroll process of
      Magnesium Reduction of Titanium Tetrachloride followed by Vacuum
      Distillation.
  1.3
              Titanium
      sponge applied to this specification shall be made in accordance with a
      method of manufacture approved by TIMET.  No change shall be
      made in the approved method of manufacture without prior consultation with
      TIMET.
  1.4
              The
      method of manufacture shall clearly detail the provision to deal with fire
      affected lots at all stages of processing and shall be agreed by
      TIMET.
  2
              ACKNOWLEDGEMENT
  The
manufacturer, defined throughout this specification as the supplier, shall
explicitly incorporate this specification, RMS 71.8, and revision number, in all
quotations, certifications and acknowledgements.
  3
              APPLICABLE
      DOCUMENTS
  3.1
              TIMET
      RMS 1000, Critical
      Aerospace Application Raw Materials Quality Systems
      Requirements.
  3.2
              PWA
      1201, Titanium
      Sponge.
  4
              TECHNICAL
      REQUIREMENTS
  4.1
              Composition
  Material
shall conform to the percentages by weight shown in Table
I.  Determination shall be by wet chemical methods in accordance with
ASTM E120, by spectro-chemical methods or by other analytical methods acceptable
to TIMET.
  4.2
              Table I: Chemical
      Analysis
  The
following elements shall be determined analytically and shall not exceed the
limits detailed below.  Titanium content shall not be less than
*.
 MaxFe
                *Cl
                *Mn
                *N
                *C
                *H*
                *O
                *Si
                *Cr*
                *Al*
                *Ni*
                *Mg*
                *Sn*
                *Water*
                *Other*
                *Other
      Total*
                *Titanium*
                remainder
 
 * Need
not be analysed; can be guaranteed.  Results of analysis may be
rounded to the last figure shown in Table.
  4.3
              Physical
      Form
  4.3.1
              *.
  *
              *
              **             8%
      max
                *             84%
      min
                *           8%
      max
              *               8%
      max
                *              90%
      min
                *               2%
      max
              *             5%
      max
                *          5%
      min
                *                Balance
                *             Nil
  4.3.2
              The
      maximum Brinell hardness shall be
*.
  4.3.3
              *.
   B-1
  4.4
                Sampling
  A
representative sample shall be obtained by separating a representative portion
of the material during mixing of the lot before packaging.  The sample
size shall be determined by the approved process plan.  The sample
size that is sent to the customer and extracted from the representative portion
shall be 5kg and this shall be sent with the lot.
  A slice
of the manufacturer’s evaluation ingot/button shall be sent with the batch only
when requested by the customer.  The slice shall be attached to the
outside of the drum.
  4.5
              Quality
  4.5.1
              *.
  4.5.2
              Sponge
      particles from each lot or blend shall be 100% visually inspected to
      remove any particle of unusual color and physical
      appearance.  Nitrogen content of any such segregated particle
      shall be determined.
  4.5.3
              No
      sponge batch or lot shall be used when the nitrogen content of any
      particle analysed as in 4.5.2 exceed
*.
  4.5.4
              No
      sponge shall be used which has been subjected to a fire or has been
      produced in equipment which has experienced a fire until that equipment
      has been cleaned, inspected for damage and has produced sponge not used
      for product meeting this
specification.
  4.5.5
              Specific
      procedures must be available detailing how any material under 4.5.4 is
      dealt with.
  4.5.6
              Specific
      procedures must be available dealing with control of any dense metal
      tools, which are used in the processing/inspection areas, e.g., tungsten
      or tungsten carbide.
  4.5.7
              *.
  4.5.8
              *.
  4.5.9
              Every
      effort shall be made to keep 4.5.7 and 4.5.8 to a minimum and dispatch all
      the lots from cake in one shipment.
  4.6
              Receiving
      inspection
  Titanium
sponge received by the purchaser which, subsequent tests and analysis show not
to be in accordance with this specification, shall be subject to rejection or
replacement free of charge.  All material shall undergo a full visual
inspection as agreed with the purchaser and any lots which contains a colored
particle of greater than * nitrogen shall be rejected.
  4.7
              Lots
  Titanium
sponge shall be supplied in homogeneous lots, which shall be allocated an
individual identification.  A lot is defined as a number of drums
which have been filled at anytime in such a manner that the chemical
composition, particle size distribution and hardness of the contents of each
drum are adequately covered by one set of samples and test
certificates.  Any lots with a duplicated number will be
returned.
   5
              IDENTIFICATION
  The body
of each drum (not the lid) shall be legibly marked in characters at least 30mm
high with a description of the material, the lot number and the drum
number.
 
 6
              PACKAGING
  6.1
              *.
  6.2
              *.
 
 7
              SHIPPING
  7.1
              Within
      each delivery, the drums shall be arranged in order of lot and drum
      number.
  7.2
              The
      method of packing and delivery shall not be altered without the prior
      agreement of TIMET.
  7.3
              The
      sample required by section 4.4 of the specification shall be included in
      drum one (1) of the lot and the slice from the ingot/button shall be
      attached to the outside of the
drum.
 
 8
              CERTIFICATION
  8.1
              Unless
      otherwise specified, the supplier shall send to the Quality Manager of the
      TIMET site, prior to, or at the time of despatch, documents showing the
      following:
   B-2
  8.2
                Test
      report in duplicate stating the TIMET specification and grade
      giving:
  8.2.1
                Chemical
      analyses
  8.2.2
                Hardness
      of each lot
  8.2.3
                Particle
      size analysis
  8.2.4
                Bulk
      density of each lot
  8.2.5
                A
      statement that each lot conforms to PWA 1201 and this
      specification.
  8.3
                A
      copy of the test report shall also be included in drum one (1) of the
      lot.
  9
              NON-CONFORMANCE
  TIMET
shall be entitled to reject the whole lot if the lot is not in accordance with
this specification or RMS 1000.
   10
              QUALITY
      ASSURANCE
  In
accordance to the requirements defined in RMS 1000, the method of manufacture
shall include, but is not limited to, the following parameters:
 
 10.1
              Source
      or method of producing raw materials, i.e., magnesium, titanium
      tetrachloride
  10.2
              Size
      of reaction pots
  10.3
              Method
      of reactant additions
  10.4
              Process
      control of reaction, temperatures, vacuum and leak
    detection
  10.5
              Method
      of cake removal
  10.6
              Dressing,
      classifying crushing of cake
  10.7
              Sampling
      procedures
  10.8
              In-process
      testing and hand sorting (visual
inspection)
  10.9
              Final
      inspection and certification.
   11
              OTHER
      CRITERIA
  11.1
              The
      order of precedence shall be any applicable agreements between TIMET and
      the customer, the requirements listed on the TIMET Purchase Order or
      contract, RMS 71.8 (latest revision) and RMS 1000 (latest
      revision).
  11.2
              All
      material shall satisfy the requirements of PWA 1201 (latest
      revision).
  12
              APPENDIX
  None.
   REVISION
HISTORY:
  Revision
      3:
              Sep
      01
              Minor
      amendments to existing revision; reference to Grade 1
    removed.
  Revision
      2:
              Jun
      01
              This
      RMS was revised to include only Grade 1-sponge
    requirements.
  Revision
      1:
              Feb
      98
              Original
      issue.
  
 
  B-3
  Exhibit B-2 to Exhibit
99.1
   SPECIFICATIONS FOR STANDARD GRADE
SPONGE
 
 TIMETRAW MATERIAL SPECIFICATION
72.8 (REV. 1)
 
  1
              SCOPE
  1.1
              This
      specification covers standard grade titanium sponge for conversion to
      semi-fabricated parts.
  1.2
              Titanium
      sponge to this specification shall be made by the Kroll process of
      Magnesium Reduction of Titanium Tetrachloride followed by Vacuum
      Distillation.
  1.3
              Titanium
      sponge applied to this specification shall be made in accordance with a
      method of manufacture approved by TIMET.  No change shall be
      made in the approved method of manufacture without prior consultation with
      TIMET.
  1.4
              The
      method of manufacture shall clearly detail the provision to deal with fire
      affected lots at all stages of processing and shall be agreed by
      TIMET.
  2
              ACKNOWLEDGEMENT
  The
manufacturer, defined throughout this specification as the supplier, shall
explicitly incorporate this specification, RMS 72.8, and revision number, in all
quotations, certifications and acknowledgements.
   3
              APPLICABLE
      DOCUMENTS
  TIMET RMS
1000, Critical Aerospace
Application Raw Materials Quality Systems Requirements.
   4
              TECHNICAL
      REQUIREMENTS
  4.1
              Composition
  Material
shall conform to the percentages by weight shown in Table
I.  Determination shall be by wet chemical methods in accordance with
ASTM E120, by spectro-chemical methods or by other analytical methods acceptable
to TIMET.
  4.2
              Table I: Chemical
      Analysis
  The
following elements shall be determined analytically and shall not exceed the
limits detailed below.  Titanium content shall not be less than
*.
 MaxFe
                *Cl
                *Mn
                *N
                *C
                *H*
                *O
                *Si
                *Cr*
                *Al*
                *Ni*
                *Mg*
                *Sn*
                *Water*
                *Other*
                *Other
      Total*
                *Titanium*
                remainder
 * Need
not be analysed; can be guaranteed.  Results of analysis may be
rounded to the last figure shown in Table.
  4.3
              Physical
      Form
  4.3.1
              *.
  *
              *
              **             8%
      max
                *            84%
      min
                *              8%
      max
              *               8%
      max
                *              90%
      min
                *               2%
      max
              *             5%
      max
                *              5%
      min
                *                Balance
                *             Nil
  4.3.2
              The
      maximum Brinell hardness shall be
*.
  4.3.3
              *.
   B-4
  4.4
              Sampling
  A
representative sample shall be obtained by separating a representative portion
of the material during mixing of the lot before packaging.  The sample
size shall be determined by the approved process plan.  The sample
size that is sent to the customer and extracted from the representative portion
shall be 5kg and this shall be sent with the lot.
  A slice
of the manufacturer’s evaluation ingot/button shall be sent with the batch only
when requested by the customer.  The slice shall be attached to the
outside of the drum.
  4.5
              Quality
  4.5.1
              *.
  4.5.2
              Sponge
      particles from each lot or blend shall be 100% visually inspected to
      remove any particle of unusual color and physical
      appearance.  Nitrogen content of any such segregated particle
      shall be determined.
  4.5.3
              No
      sponge batch or lot shall be used when the nitrogen content of any
      particle analysed as in 4.5.2 exceed
*.
  4.5.4
              No
      sponge shall be used which has been subjected to a fire or has been
      produced in equipment which has experienced a fire until that equipment
      has been cleaned, inspected for damage and has produced sponge not used
      for product meeting this
specification.
  4.5.5
              Specific
      procedures must be available detailing how any material under 4.5.4 is
      dealt with.
  4.5.6
              Specific
      procedures must be available dealing with control of any dense metal
      tools, which are used in the processing/inspection areas, e.g., tungsten
      or tungsten carbide.
  4.5.7
              Every
      effort shall be made to keep a) number of batches per lot and b) number of
      lots incorporating the same sponge batch to a minimum and despatch all the
      lots from a cake in one shipment.
  4.6
              Inspection
  Titanium
sponge received by the purchaser which, subsequent tests and analysis show not
to be in accordance with this specification, shall be subject to rejection or
replacement free of charge.  All material shall undergo a full visual
inspection as agreed with the purchaser and any lots which contains a colored
particle of greater than * nitrogen shall be rejected.
  4.7
              Lots
  Titanium
sponge shall be supplied in homogeneous lots, which shall be allocated an
individual identification.  A lot is defined as a number of drums
which have been filled at anytime in such a manner that the chemical
composition, particle size distribution and hardness of the contents of each
drum are adequately covered by one set of samples and test
certificates.  Any lots with a duplicated number will be
returned.
   5
              IDENTIFICATION
  The body
of each drum (not the lid) shall be legibly marked in characters at least 30mm
high with a description of the material, the lot number and the drum
number.
 
 6
              PACKAGING
  6.1
              *.
  6.2
              *.
 
 7
              SHIPPING
  7.1
              Within
      each delivery, the drums shall be arranged in order of lot and drum
      number.
  7.2
              The
      method of packing and delivery shall not be altered without the prior
      agreement of TIMET.
  7.3
              The
      sample required by section 4.4 of the specification shall be included in
      drum one (1) of the lot and the slice from the ingot/button shall be
      attached to the outside of the
drum.
   B-5
 
 8
              CERTIFICATION
  8.1
              Unless
      otherwise specified, the supplier shall send to the Quality Manager of the
      TIMET site, prior to, or at the time of despatch, documents showing the
      following:
  8.2
              Test
      report in duplicate stating the TIMET specification and grade
      giving:
  8.2.1
              Chemical
      analyses
  8.2.2
              Hardness
      of each lot
  8.2.3
              Particle
      size analysis
  8.2.4
              Bulk
      density of each lot
  8.2.5
              A
      statement that each lot conforms to this
  specification.
  8.3
              A
      copy of the test report shall also be included in drum one (1) of the
      lot.
   9
              NON-CONFORMANCE
  TIMET
shall be entitled to reject the whole lot if the lot is not in accordance with
this specification or RMS 1000.
   10
              QUALITY
      ASSURANCE
  In
accordance to the requirements defined in RMS 1000, the method of manufacture
shall include, but is not limited to, the following parameters:
 
 10.1
              Source
      or method of producing raw materials, i.e., magnesium, titanium
      tetrachloride
  10.2
              Size
      of reaction pots
  10.3
              Method
      of reactant additions
  10.4
              Process
      control of reaction, temperatures, vacuum and leak
    detection
  10.5
              Method
      of cake removal
  10.6
              Dressing,
      classifying crushing of cake
  10.7
              Sampling
      procedures
  10.8
              In-process
      testing and hand sorting (visual
inspection)
  10.9
              Final
      inspection and certification.
   11
              OTHER
      CRITERIA
  The order
of precedence shall be any applicable agreements between TIMET and the customer,
the requirements listed on the TIMET Purchase Order or contract, RMS 72.8
(latest revision) and RMS 1000 (latest revision).
   12
              APPENDIX
  None.
   REVISION
HISTORY:
  Revision
      1:
              Sep
      01
              Minor
      amendments to existing revision.
  Revision
      0:
              Jun
      01
              Original
      issue.
  
  
   B-6