UNITED STATES OF AMERICA
FEDERAL TRADE COMMISSION

AGREEMENT CONTAINING CONSENT ORDER

The Federal Trade Commission ("Commission") having initiated an investigation of the proposed acquisition by Global Industrial Technologies, Inc. ("Global") of AP Green Industries, Inc. ("AP Green"), and it now appearing that Global, hereinafter sometimes referred to as "proposed respondent," is willing to enter into an agreement containing an order to divest certain assets and providing for other relief:

IT IS HEREBY AGREED by and between proposed respondent, by its duly authorized officers and attorneys, and counsel for the Commission that:

1. Proposed respondent Global Industrial Technologies, Inc. is a corporation organized, existing and doing business under and by virtue of the laws of Delaware with its office and principal place of business located at 2121 San Jacinto Street, Suite 2500, Dallas, Texas, 75201.

2. Proposed respondent admits all the jurisdictional facts set forth in the draft of Complaint here attached.

3. Proposed respondent waives:

a. any further procedural steps;

b. the requirement that the Commission’s decision contain a statement of findings of fact and conclusions of law;

c. all rights to seek judicial review or otherwise to challenge or contest the validity of the Order entered pursuant to this agreement; and

d. any claim under the Equal Access to Justice Act.

4. Proposed respondent shall submit within thirty (30) days of the date this agreement is signed by proposed respondent, an initial report, pursuant to Section 2.33 of the Commission’s Rules, signed by the proposed respondent setting forth in detail the manner in which the proposed respondent will comply with Paragraph II of the Order when and if entered. Such report will not become part of the public record unless and until the accompanying agreement and Order are accepted by the Commission for public comment.

5. This agreement shall not become part of the public record of the proceeding unless and until it is accepted by the Commission. If this agreement is accepted by the Commission it, together with the draft of Complaint contemplated thereby, will be placed on the public record for a period of sixty (60) days and information in respect thereto publicly released. The Commission thereafter may either withdraw its acceptance of this agreement and so notify the proposed respondent, in which event it will take such action as it may consider appropriate, or issue and serve its Complaint (in such form as the circumstances may require) and decision, in disposition of the proceeding.

6. This agreement is for settlement purposes only and does not constitute an admission by proposed respondent that the law has been violated as alleged in the draft of Complaint here attached, or that the facts as alleged in the draft Complaint, other than jurisdictional facts, are true.

7. This agreement contemplates that, if it is accepted by the Commission, and if such acceptance is not subsequently withdrawn by the Commission pursuant to the provisions of Commission Rule 2.34, 16 C.F.R. § 2.34, the Commission may, without further notice to the proposed respondent, (1) issue its Complaint corresponding in form and substance with the draft of Complaint here attached and its decision containing the following Order to divest and providing for other relief in disposition of the proceeding and (2) make information public with respect thereto. When so entered, the Order shall have the same force and effect and may be altered, modified or set aside in the same manner and within the same time provided by statute for other orders. The Order shall become final upon service. Delivery by the U.S. Postal Service of the Complaint and decision containing the agreed-to Order to proposed respondent’s address as stated in this agreement shall constitute service. Proposed respondent waives any right it may have to any other manner of service. The Complaint may be used in construing the terms of the Order, and no agreement, understanding, representation, or interpretation not contained in the Order or the agreement may be used to vary or contradict the terms of the Order.

8. By signing this agreement containing consent order, proposed respondent represents that the full relief contemplated by this agreement can be accomplished.

9. Proposed respondent has read the proposed Complaint and Order contemplated hereby. Proposed respondent understands that once the Order has been issued, it will be required to file one or more compliance reports showing how it has fully complied with the Order. Proposed respondent agrees to comply with Paragraphs II and III of the proposed Order from the date it signs this agreement. Proposed respondent agrees that if it divests the divested assets pursuant to Paragraph II.A. of the Order prior to the time the Order becomes final, it will include and enforce a provision in the divestiture agreement requiring the transaction to be rescinded, and the divested assets returned to the proposed respondent, should the Commission not make the Order final or should the Commission notify the proposed respondent that the acquirer is not an acceptable acquirer, or the divestiture agreement is not an acceptable manner of divestiture. Proposed respondent further understands that it may be liable for civil penalties in the amount provided by law for each violation of the Order after it becomes final.

ORDER

I.

IT IS ORDERED that, as used in this Order, the following definitions shall apply:

A. "Respondent" or "Global" means Global Industrial Technologies, Inc., its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; and its subsidiaries, divisions, groups and affiliates controlled by Global Industrial Technologies, Inc., and the respective directors, officers, employees, agents and representatives, successors, and assigns of each.

B. "AP Green" means AP Green Industries, Inc., a corporation organized, existing and doing business under and by virtue of the laws of Delaware with its office and principal place of business located at Green Boulevard, Mexico, Missouri, 65265.

C. "Commission" means the Federal Trade Commission.

D. "Acquisition" means the acquisition described in the Agreement and Plan of Merger, dated as of March 3, 1998, between Global and AP Green pursuant to which Global has agreed, through a subsidiary, to acquire AP Green.

E. "Silica Refractories" means refractory silica products, including silica bricks and shapes, and silica mortar, but excluding fused, foam, and vitreous silica.

F. "Hile Plant" means the manufacturing facility located in Northeast, Maryland that is currently owned and operated by Harbison-Walker Refractories Company ("HWR"), a subsidiary of Global.

G. "Lehi Plant" means the manufacturing facility located in Lehi, Utah that is currently owned and operated by AP Green.

H. "Divested Assets" means the assets required to be divested pursuant to Paragraphs II and III of this Order.

I. "Acquirer" means the entity to whom Global shall divest the Divested Assets.

J. "Assets and Businesses" means assets, properties, businesses, and goodwill, tangible and intangible, relating to the research, development, production, sale, or distribution of Silica Refractories, including, without limitation, the following:

1. all plant facilities, machinery, fixtures, equipment, vehicles, transportation and storage facilities, furniture, tools, supplies, stores, spare parts, and other tangible personal property;
2. all customer lists, vendor lists, catalogs, sales promotion literature, advertising materials, research materials, technical information, dedicated management information systems, information contained in management information systems, rights to software, technology, know-how, ongoing research and development, specifications, designs, drawings, processes and quality control data;
3. all intellectual property rights, patents, patent rights, patent applications, formulas, inventions, copyrights, trade secrets, trademarks, and trade names;
4. raw material and finished product inventories and goods in process;
5. all right, title and interest in and to owned or leased real property, together with appurtenances, licenses, and permits;
6. all right, title, interest, and contractual rights in and to sources of raw material for Silica Refractories;
7. all right, title, and interest in and to the contracts (together with associated bids) entered into in the ordinary course of business with customers, suppliers, sales representatives, distributors, agents, personal property lessors, personal property lessees, licensors, licensees, consignors and consignees;
8. all rights under warranties and guarantees, express or implied;
9. all separately maintained, as well as relevant portions of not separately maintained books, records and files;
10. all federal, state, and local regulatory agency registrations, permits, and applications, and all documents related thereto; and
11. all items of prepaid expense.

K. "AP Green Silica Refractories Properties to be Divested" means AP Green's Lehi Plant, and all other Assets and Businesses of AP Green relating to the research, development, production, sale, or distribution of Silica Refractories, but excluding AP Green's manufacturing facility in Sproul, Pennsylvania provided however that, at the option of the Acquirer, Global shall install at the Lehi Plant prior to the divestiture the mixing equipment necessary to manufacture silica mortar.

L. "HWR Silica Refractories Properties to be Divested" means Global's Hile Plant, and all other Assets and Businesses of Global relating to the research, development, production, sale, or distribution of Silica Refractories, but excluding Global's manufacturing facility in Calhoun, Georgia provided however that, at the option of the Acquirer, Global shall install at the Hile Plant prior to the divestiture the mixing equipment necessary to manufacture silica mortar.

II.

IT IS FURTHER ORDERED that:

A. Respondent shall divest, absolutely and in good faith, at no minimum price, the AP Green Silica Refractories Properties to be Divested as an ongoing business. The divestiture shall be made either:

1. within thirty (30) days of the date this Order is accepted by the Commission for public comment to Robert R. Worthen and Dennis R. Williams (jointly or through a corporation or partnership to be established by them) in a manner that receives the prior approval of the Commission; or
2. within ninety (90) days of the date this Order is accepted by the Commission for public comment to an Acquirer that receives the prior approval of the Commission and only in a manner that receives the prior approval of the Commission.

B. The purpose of the divestiture of the Divested Assets is to ensure the continued use of the Divested Assets in the same business in which the Divested Assets are engaged at the time of the proposed Acquisition, and to remedy the lessening of competition resulting from the Acquisition as alleged in the Commission’s Complaint.

C. Pending divestiture of the Divested Assets pursuant to Paragraph II or Paragraph III of this Order, Respondent shall take such actions as are necessary to maintain the viability and marketability of the Divested Assets and to prevent the destruction, removal, wasting, deterioration, or impairment of any of the Divested Assets except for ordinary wear and tear.

III.

IT IS FURTHER ORDERED that:

A. If Respondent has not divested, absolutely and in good faith and with the Commission’s prior approval, the AP Green Silica Refractories Properties to be Divested within ninety (90) days of the date this Order is accepted by the Commission for public comment, then the Commission may appoint a trustee to divest, at the option of the Trustee, the AP Green Silica Refractories Properties to be Divested, or the HWR Silica Refractories Properties to be Divested. In the event the Commission or the Attorney General brings an action pursuant to Section 5(l) of the Federal Trade Commission Act, 15 U.S.C. § 45(l), or any other statute enforced by the Commission, Respondent shall consent to the appointment of a trustee in such action. Neither the appointment of a trustee nor a decision not to appoint a trustee under this Paragraph shall preclude the Commission or the Attorney General from seeking civil penalties or any other relief (including, but not limited to, a court-appointed trustee) pursuant to the Federal Trade Commission Act or any other statute enforced by the Commission, for any failure by Respondent to comply with this Order.

B. If a trustee is appointed by the Commission or a court pursuant to Paragraph III.A. of this Order, Respondent shall consent to the following terms and conditions regarding the trustee’s powers, duties, authority, and responsibilities:

1. The Commission shall select the trustee, subject to the consent of Respondent, which consent shall not be unreasonably withheld. The trustee shall be a person with experience and expertise in acquisitions and divestitures. If Respondent has not opposed, in writing, including the reasons for opposing, the selection of any proposed trustee within ten (10) days after notice by the staff of the Commission to Respondent of the identity of any proposed trustee, Respondent shall be deemed to have consented to the selection of the proposed trustee.
2. Subject to the prior approval of the Commission, the trustee shall have the exclusive power and authority to divest the AP Green Silica Refractories Properties to be Divested and the HWR Silica Refractories Properties to be Divested in order to accomplish the divestiture required by this Order.
3. Within ten (10) days after appointment of the trustee, Respondent shall execute a trust agreement that, subject to the prior approval of the Commission (and, in the case of a court-appointed trustee, of the court), transfers to the trustee all rights and powers necessary to permit the trustee to effect the divestiture required by this Order.
4. The trustee shall have twelve (12) months from the date the Commission approves the trust agreement described in Paragraph III.B.3. of this Order to accomplish the divestiture required by this Order, which shall be subject to the prior approval of the Commission. If, however, at the end of the twelve (12) month period, the trustee has submitted a plan of divestiture or believes that divestiture can be achieved within a reasonable time, the divestiture period may be extended by the Commission (or, in the case of a court-appointed trustee, by the court); provided, however, the Commission may extend this period for no more than two (2) additional terms of twelve (12) months each.
5. The trustee shall have full and complete access to the personnel, books, records, and facilities related to the AP Green Silica Refractories Properties to be Divested and the HWR Silica Refractories Properties to be Divested, or to any other relevant information, as the trustee may request. Respondent shall develop such financial or other information as such trustee may request and shall cooperate with the trustee. Respondent shall take no action to interfere with or impede the trustee’s accomplishment of the divestiture. Any delays in divestiture caused by the Respondent shall extend the time for divestiture under Paragraph III.B.4. of this Order in an amount equal to the delay, as determined by the Commission (or, in the case of a court-appointed trustee, by the court).
6. The trustee shall use his or her best efforts to expeditiously negotiate the most favorable price and terms available in each contract that is submitted to the Commission, subject to Respondent’s absolute and unconditional obligation to divest at no minimum price. The divestiture shall be made only to an Acquirer or Acquirers that receive the prior approval of the Commission, and only in a manner that receives the prior approval of the Commission as set out in Paragraph II of this Order; provided, however, if the trustee receives bona fide offers from more than one acquiring entity, the trustee shall submit all bids to the Commission, and if the Commission approves more than one such acquiring entity, then the trustee shall divest to the acquiring entity or entities selected by Respondent from among those approved by the Commission.
7. The trustee shall serve, without bond or other security, at the cost and expense of Respondent, on such reasonable and customary terms and conditions as the Commission or a court may set. The trustee shall have authority to employ, at the cost and expense of Respondent, such consultants, accountants, attorneys, investment bankers, business brokers, appraisers, and other representatives and assistants as are necessary to carry out the trustee’s duties and responsibilities. The trustee shall account for all monies derived from the divestiture and all expenses incurred. After approval by the Commission (and, in the case of a court-appointed trustee, by the court), of the account of the trustee, including fees for his or her services, all remaining monies shall be paid at the direction of Respondent and the trustee’s power shall be terminated. The trustee’s compensation shall be based at least in significant part on a commission arrangement based on sales price and contingent on the trustee’s accomplishing the divestiture required by this Order.
8. Respondent shall indemnify the trustee and hold the trustee harmless against any losses, claims, damages, liabilities, or expenses arising out of, or in connection with, the performance of the trustee’s duties, including all reasonable fees of counsel and other expenses incurred in connection with the preparation for, or defense of any claim, whether or not resulting in any liability, except to the extent that such liabilities, losses, damages, claims, or expenses result from misfeasance, gross negligence, recklessness, willful or wanton acts, or bad faith by the trustee.
9. If the trustee ceases to act or fails to act diligently, a substitute trustee shall be appointed in the same manner as provided in Paragraph III of this Order.
10. The Commission (or, in the case of a court-appointed trustee, the court) may on its own initiative or at the request of the trustee issue such additional orders or directions as may be necessary or appropriate to accomplish the divestiture required by this Order.
11. The trustee may divest such additional ancillary assets related to the Divested Assets and effect such ancillary arrangements as are necessary to satisfy the requirements or purposes of this Order.
12. The trustee shall have no obligation or authority to operate or maintain the AP Green Silica Refractories Properties to be Divested or the HWR Silica Refractories Properties to be Divested.
13. The trustee shall report in writing to Respondent and the Commission every sixty (60) days concerning the trustee’s efforts to accomplish the divestiture.

IV.

IT IS FURTHER ORDERED that within thirty (30) days after the date this Order becomes final, and every sixty (60) days thereafter until Respondent has fully complied with the provisions of Paragraphs II and III of this Order, Respondent shall submit to the Commission verified written reports setting forth in detail the manner and form in which Respondent intends to comply, is complying, and has complied with Paragraphs II and III of this Order. Respondent shall include in its compliance reports, among other things that are required from time to time, a full description of the efforts being made to comply with Paragraphs II and III of the Order, including a description of all substantive contacts or negotiations for the divestiture and the identity of all parties that have contacted Respondent or that have been contacted by Respondent. Respondent shall include in its compliance reports copies of all written communications to and from such parties, all internal memoranda, and all reports and recommendations concerning divestiture.

V.

IT IS FURTHER ORDERED that Respondent shall notify the Commission at least thirty (30) days prior to any proposed change in the corporate Respondent such as dissolution, assignment, or sale resulting in the emergence of a successor corporation, or the creation or dissolution of subsidiaries, or any other change in the corporation that may affect compliance obligations arising out of this Order.

VI.

IT IS FURTHER ORDERED that, for the purpose of determining or securing compliance with this Order, upon written request, Respondent shall permit any duly authorized representative of the Commission:

A. Access, during office hours and in the presence of counsel, to inspect any facilities and to inspect and copy all books, ledgers, accounts, correspondence, memoranda and other records and documents in the possession or under the control of Respondent relating to any matters contained in this Order; and

B. Upon five (5) days’ notice to Respondent and without restraint or interference from them, to interview officers, directors, or employees of Respondent.

VII.

IT IS FURTHER ORDERED that this Order shall terminate ten (10) years after the date on which it is issued.

Signed this _____ day of _______________, ____.

_______________________________
William J. Baer
Director