EXHIBIT 10.33

 

 

 

 

FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

 

 

 

Amended and Restated

As of January 1, 2005

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FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

INTRODUCTION

This document (this “Plan”) is the FERRO CORPORATION SUPPLEMENTAL DEFINED
CONTRIBUTION PLAN FOR EXECUTIVE EMPLOYEES. This Plan was originally adopted and
effective as of January 1, 1996, and was most recently amended and restated
effective June 30, 2004.

This Plan is now amended and restated generally effective January 1, 2005, for
the purpose of complying with new Code Section 409A. Code Section 409A permits
deferred compensation which is earned and vested in taxable years beginning
before January 1, 2005 to be exempt from Code Section 409A if the plan under
which the deferral is made is not materially modified after October 3, 2004.

Ferro elects and intends to exempt from Code Section 409A the deferred
compensation which was earned and vested under the Plan as of December 31, 2004.
Consistent with this election, the Plan, as amended and restated effective
January 1, 2005, is comprised of two parts:

 

  •  

Part A, which contains the terms of the Plan as in effect on October 4, 2004
(and as subsequently amended) which govern deferred compensation which was
earned and vested under the Plan as of December 31, 2004 (the “Pre-2005 Plan”),
and

 

  •  

Part B, which contains the terms of the Plan which govern deferred compensation
which was earned and vested after December 31, 2004 (the “2005 Plan”).

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TABLE OF CONTENTS

 

         Page  

Part A:

  Pre-2005 Plan      A-1   

Part B:

  2005 Plan      B-1   

Execution Page

     C-1   

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FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

PART A: PRE-2005 PLAN

OVERVIEW

ESTABLISHMENT OF COMPONENT PLAN

The terms of the Plan as it existed on October 4, 2004, and as modified in this
amendment and restatement by the addition of Appendices C and D constitute the
Pre-2005 component plan (the “Pre-2005 Plan”).

The Pre-2005 Plan is reproduced in this Part A. It consists of the Plan as it
was amended and restated effective June 30, 2004, and as it has been further
amended by the addition of Appendices C and D. Appendix C changed the investment
measure for crediting deemed interest under the Plan. This change is consistent
with Treasury Regulations under Code Section 409A, which provide that it is not
a material modification to change an investment measure to one which qualifies
as predetermined actual investment or a reasonable rate of interest. Appendix D
modified the definition of compensation for calculating non-elective
Supplemental Matching Contributions under the Plan (i.e., clarified that
contributions are based on compensation which includes only the cash portion of
awards under the Performance Share Plan and not the entire award). This change
is consistent with Treasury Regulations, which provide that it is not a material
modification to reduce an existing benefit or right. Further, the change was a
clarification for purposes of bringing the terms of the Plan consistent with
past administration, and no other rights or benefits were provided to the
Participants in exchange.

As described above, the Pre-2005 Plan has not been materially modified after
October 4, 2004.

EXEMPT FROM CODE SECTION 409A

Deferred compensation which is earned and vested in taxable years beginning
before January 1, 2005 is permitted to be exempt from Code Section 409A if the
plan under which the deferral is made is not materially modified after
October 3, 2004.

Ferro elects and intends to exempt from Code Section 409A the deferred
compensation which was earned and vested under the Plan as of December 31, 2004,
pursuant to the terms of the Pre-2005 Plan.

GOVERNS ONLY PRE-2005 BENEFITS

The Pre-2005 Plan governs only those benefits that were earned and vested under
the Plan as of December 31, 2004 (the “Pre-2005 Benefits”).

A Participant’s Pre-2005 Benefit equals the portion of his account balance which
was earned and vested as of December 31, 2004 (including any future
contributions to the account, the right to which was earned and vested as of
December 31, 2004), plus any income attributable to such amounts or to such
income.

 

A-1

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TERMINOLOGY

As used in the Pre-2005 Plan, the term “Plan” refers to the Pre-2005 Plan or to
the Plan, as appropriate.

 

A-2

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FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

 

 

 

Part A: Pre-2005 Plan

As Amended and Restated

June 30, 2004

(and as further modified)

 

A-3

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

INTRODUCTION

This document (this “Plan”) is the FERRO CORPORATION SUPPLEMENTAL DEFINED
CONTRIBUTION PLAN FOR EXECUTIVE EMPLOYEES. This Plan was originally adopted and
effective as of January 1, 1996.

This Plan is now amended and restated effective June 30, 2004, as follows:

ARTICLE I

NAME AND PURPOSE

 

1.1 Name. The name of this Plan is the “Ferro Corporation Supplemental Defined
Contribution Plan for Executives.”

 

1.2 Plan Sponsor. The sponsor of this Plan is Ferro Corporation (“Ferro”), an
Ohio corporation.

 

1.3 Purpose. The purpose of this Plan is to replace, under the conditions set
forth in this Plan, certain benefits that select management and highly
compensated employees of the Ferro Group Companies cannot receive under Ferro
Corporation Savings and Stock Ownership Plan due to limitations imposed by the
Internal Revenue Code or by plan design.

 

1.4 Plan for a Select Group. This Plan covers only employees of a Ferro Group
Company who are members of a “select group of management or highly compensated
employees” as provided in Sections 201(2), 301(a)(3), 401(a)(1) and 4021(b)(6)
of ERISA. Notwithstanding any provision of this Plan to the contrary, this Plan
will be administered and its benefits limited in a manner to comply with the
above cited sections of ERISA.

 

1.5 Not a Funded Plan. Ferro intends that this Plan be deemed to be “unfunded”
for tax purposes as well as for purposes of Title I of ERISA. Notwithstanding
any provision of this Plan to the contrary, this Plan will be administered in a
manner so that it is deemed “unfunded.”

ARTICLE II

DEFINITIONS AND INTERPRETATION

 

2.1 Definitions. Appendix A sets forth the definitions of certain terms used in
this Plan. Those terms shall have the meanings set forth on Appendix A where
used in this Plan and identified with initial capital letters.

 

2.2 General Rules of Construction. For purposes of interpreting this Plan,

 

A-4

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

  (A) the masculine gender will include the feminine and neuter, and vice versa,
as the context requires;

 

  (B) the singular number will include the plural, and vice versa, as the
context requires;

 

  (C) the present tense of a verb will include the past and future tenses, and
vice versa, as the context requires; and

 

  (D) as provided under Article VIII, the Administrator retains the power and
duty to interpret this Plan and resolve ambiguities.

ARTICLE III

PARTICIPATION

 

3.1 Eligibility. In order to be eligible to participate in this Plan, an
individual must be a Highly Compensated Employee.

 

3.2 Participation. A Highly Compensated Employee will become a Participant in
this Plan on the January 1 immediately following the date he or she becomes a
Highly Compensated Employee.

ARTICLE IV

SUPPLEMENTAL MATCHING CONTRIBUTIONS,

SUPPLEMENTAL BASIC PENSION CONTRIBUTIONS,

AND ACCOUNTS

 

4.1 Eligibility for Supplemental Matching Contributions. Each Plan Year a
Supplemental Matching Contribution will be credited to the Account of each
Participant who is eligible. A Participant will be eligible if the Participant:

 

  (A) made the maximum 401(k) Contributions permitted under the Ferro SSOP
during the Plan Year, and

 

  (B) either:

 

  (1) was employed by a Ferro Group Company on the last day of the Plan Year,

 

  (2) died during the Plan Year,

 

  (3) retired and began receiving pension benefits under the Ferro Corporation
Retirement Plan during the Plan Year (or, if not a participant in the Ferro
Corporation Retirement Plan, terminated employment after attaining age 55 and 5
Years of Vesting Service during the Plan Year), or

 

  (4) incurred a Disability during the Plan Year.

 

A-5

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

4.2 Amount of Supplemental Matching Contributions. An eligible Participant will
receive a Supplemental Matching Contribution on the last day of the Plan Year
equal to A minus B, where:

 

  (A) “A” equals the amount of matching contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
if the Participant elected to make 401(k) Contributions equal to eight percent
(8%) of Compensation and the Code provisions allowed and did not impose a limit
on such 401(k) Contributions or matching contributions; and

 

  (B) “B” equals the amount of matching contributions actually contributed to
the Participant’s account under the Ferro SSOP for the Plan Year.

 

4.3 Eligibility for Supplemental Basic Pension Contributions. Each Plan Year a
Supplemental Basic Pension Contribution will be credited to the Account of each
Participant who is eligible. A Participant will be eligible if the Participant
received a Basic Pension Contribution under the Ferro SSOP during the Plan Year.

 

4.4 Amount of Supplemental Basic Pension Contributions. An eligible Participant
will receive a Supplemental Basic Pension Contribution on the last day of the
Plan Year equal to A minus B, where:

 

  (A) “A” equals the amount of Basic Pension Contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
on the basis of the Participant’s Compensation not limited by Code provisions;
and

 

  (B) “B” equals the amount of Basic Pension Contributions actually contributed
to the Participant’s account under the Ferro SSOP for the Plan Year.

 

4.5 Establishment of Account. Each Ferro Group Company will establish an Account
in the name of each Participant who is employed by it on the books and records
of the Ferro Group Company. All amounts credited to the Account of any
Participant or former Participant will constitute a general, unsecured liability
of such Ferro Group Company to the Participant. The Ferro Group Company will
maintain a separate Account for contributions credited to the Participant prior
to 2001 as may be necessary for the deemed investment of the Participant’s
Account as provided under Section 6.4 below.

 

4.6 Crediting of Earnings. The Ferro Group Company will credit the Account of
each Participant who is or was its employee with earnings, gains and losses in
accordance with the deemed investment of the Supplemental Matching Contributions
and Supplemental Basic Pension Contributions as provided under Section 6.4
below.

 

A-6

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

4.7 Vesting of Account. A Participant will become vested in his or her Account
in accordance with the following schedule:

 

Years of Vesting Service

   Percentage
Vested  

Less than 1 year

     0 % 

1 year, but less than 2

     20 % 

2 years, but less than 3

     40 % 

3 years, but less than 4

     60 % 

4 years, but less than 5

     80 % 

5 years or more

     100 % 

The prior provisions notwithstanding, a Participant who has not incurred a
Termination of Employment will be 100% vested in the Account upon the first to
occur of: (a) the Participant’s attainment of age 65, (b) the Participant’s
incurring a Disability, (c) the Participant’s death, or (d) a Change in Control.

ARTICLE V

BENEFITS; PAYMENT OF BENEFITS

 

5.1 Date of Distribution. Distribution of the vested portion of the
Participant’s Account will be made as soon as practicable after the earlier of
the Participant’s Termination of Employment, Disability or death.

 

5.2 Form of Distribution. Distribution will be in the form of a single lump sum
payment. The portion of the Participant’s Account deemed to be invested in the
Ferro Common Stock Account under Section 6.4 will be distributed in the form of
Ferro Common Stock unless the Participant elects to receive payment of that
portion in cash. The portion of the Participant’s Account deemed to be invested
in the cash account under Section 6.4 will be distributed in the form of cash.

 

5.3 Valuation of Distributions. All distributions under this Plan will be based
upon the amount credited to the Participant’s Account as of the last day of the
month in which occurs the Participant’s Termination of Employment, death, or
commencement of long-term disability benefits on account of a determination of
Disability under a Ferro Group Company long-term disability plan. Such date
shall be the Valuation Date for this purpose.

 

5.4 Death. In the event of death, the Participant’s remaining vested interest in
the Account will be distributed to the Participant’s Beneficiary.

 

5.5 Administration of Distributions. Distributions under this Plan will be made
as soon as administratively possible following receipt of notice by the
Administrator of an event that entitles a Participant or a Beneficiary to
payments under this Plan and completion by the Participant or Beneficiary of any
forms required by the Administrator.

 

5.6 Designation of Beneficiary. Subject to the rules and procedures promulgated
by the Administrator, a Participant may sign a document designating a
Beneficiary or Beneficiaries. If a Participant fails to designate any
Beneficiary in accordance with the provisions of this Section, then the
Beneficiary will be deemed to be the Participant’s beneficiary under the Ferro
SSOP.

 

A-7

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

5.7 Protective Distributions. If the Administrator determines, in its sole
discretion, that a Participant is not, or may not be, a member of a “select
group of management or highly compensated employees” within the meaning of
Section 201(2), 301(a)(3), 401(a)(1) or 4021(b)(6) of ERISA, then the
Administrator may, in its sole discretion, terminate the Participant’s
participation in this Plan, and distribute all amounts credited to the
Participant’s Account in a single lump sum payment. Any distribution under this
Section will be made at the time the Administrator determines in its sole
discretion.

 

5.8 Tax Withholding. A Ferro Group Company may withhold, from any payment made
by it under this Plan, the amount or amounts as may be required for purposes of
complying with the tax withholding or other provisions of the Code or the Social
Security Act or any state or local income or employment tax act or for purposes
of paying any estate, inheritance or other tax attributable to any amounts
payable hereunder.

 

5.9 Inability to Locate Participant. If a Ferro Group Company or the
Administrator notifies a Participant or Beneficiary of an entitlement to an
amount under this Plan and the Participant or Beneficiary fails to claim the
amount or to disclose the location of the Participant or Beneficiary within
three years thereafter, then, except as otherwise required by law, if the
location of one or more of the next of kin of the Participant or Beneficiary is
known to the Ferro Group Company or the Administrator, the Administrator may
direct distribution of the amount to any one or more or all of the next of kin,
and in such proportions as the Administrator, in its sole discretion,
determines. If the location of none of the foregoing persons can be determined,
the Administrator will direct that the amount payable to the Participant or
Beneficiary be forfeited. If, after the forfeiture, the Participant or
Beneficiary later claims the benefit under this Plan, then the benefit will be
reinstated without interest or earnings from the date of forfeiture. If a
benefit payable to a Participant or Beneficiary that cannot be located is
subject to escheat under state law, then no further benefit will be payable with
respect to any Participant for whom payment was made by the Administrator
according to the escheat provisions of state law.

ARTICLE VI

RIGHTS OF PARTICIPANTS

 

6.1 Creditor Status of Participants. The Supplemental Matching Contributions and
Supplemental Basic Pension Contributions credited to a Participant shall be
merely an unfunded, unsecured promise of the Ferro Group Company (by which the
Participant is employed) to make benefit payments in the future and shall be
liabilities solely against the general assets of such Ferro Group Company.
Except as provided in Section 6.6, Ferro and the other Ferro Group Companies
shall not be required to segregate, set aside or escrow the Supplemental
Matching Contributions, Supplemental Basic Pension Contributions nor any
earnings, gains and losses credited thereon. With respect to amounts credited to
any Account hereunder and any benefits payable hereunder, a Participant and
Beneficiary will have the status of general unsecured creditors of the Ferro
Group Company (by which the Participant is employed), and may look only to that
Ferro Group Company and its general assets for payment of the Account

 

A-8

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

6.2 Rights with Respect to the Trust. Any trust, and any assets held thereby to
assist Ferro or any other Ferro Group Company in meeting its obligations under
this Plan, will in no way be deemed to controvert the provisions of Section 6.1
above.

 

6.3 Investments. In Ferro’s sole discretion, the Ferro Group Companies may
acquire insurance policies, annuities or other financial vehicles for the
purpose of providing future assets of the Ferro Group Companies to meet their
anticipated liabilities under this Plan. Such policies, annuities or other
investments, shall at all times be and remain unrestricted general property and
assets of the Ferro Group Companies or property of a trust established pursuant
to Article VII of this Plan. Participants and Beneficiaries will have no rights,
other than as general creditors, with respect to any such policies, annuities or
other acquired assets.

 

6.4 Method for Crediting Investment Return. The Ferro Group Company by which the
Participant is employed will maintain a separate Account for the Participant. A
Participant’s Account is deemed to be invested as follows.

 

  (A) Post-2000 Contributions. The Supplemental Matching and Supplemental Basic
Pension Contributions credited to a Participant’s Account after December 31,
2000 will be deemed to be invested in Ferro Common Stock as of the date the
contributions are credited under the Plan. The Account will be deemed to receive
all dividends (whether in stock or cash) and stock splits which would be
received if the Account was actually invested in shares of Ferro Common Stock,
and such dividends and stock splits will be deemed to be reinvested in shares of
Ferro Common Stock as of the date of their receipt. Each investment in Ferro
Common Stock will be deemed to be made at the closing sale price of Ferro Common
Stock on the New York Stock Exchange Composite Tape (as reported in The Wall
Street Journal) on the trading day of the deemed investment.

 

  (B) Pre-2001 Contributions. Only Supplemental Matching Contributions were
credited under the Plan prior to 2001. The Supplemental Matching Contributions
credited to a Participant’s Account prior to 2001 will be deemed to be invested
as of the date the contributions are credited under the Plan in a cash account
with a rate of return determined by Ferro. Prior to the beginning of each Plan
Year, Ferro will determine the rate of investment credit for the following Plan
Year. The prior provisions notwithstanding, the Participant was entitled to
elect in writing, during the special election period provided in 2001, for all
or a portion of such pre-2001 Supplemental Matching Contributions to be deemed
to instead be invested in Ferro Common Stock. Under any such election, the
Supplemental Matching Contributions designated by the Participant to be deemed
invested in shares of Ferro Common Stock will be deemed invested as of the date
the contributions were credited under the Plan, and otherwise will be valued and
credited with dividends and stock splits, in the same manner as described in
Section 6.4(A) above.

 

  (C)

Periodic Adjustment of Accounts. As of each Valuation Date, the Participant’s
Account will be adjusted to reflect earnings and losses on the deemed
investments. To the extent the Account is deemed to be invested in Ferro Common
Stock, it will be credited as of each Valuation Date with hypothetical

 

A-9

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

  appreciation and depreciation and earnings, as computed and determined by the
Administrator based on the value of Ferro Common Stock and its dividends, etc.,
as provided in Section 6.4(A) above. To the extent the Participant’s Account is
deemed to be invested in the cash account, it will be credited as of each
Valuation Date with hypothetical earnings, as computed and determined by the
Administrator using a rate of interest equal to that determined by Ferro prior
to the beginning of the Plan Year as provided in Section 6.4(B) above. The
Administrator will provide each Participant with a statement showing the balance
credited to the Participant’s Account as of the last day of the preceding Plan
Year, and at such other times as the Administrator may elect.

 

  (D) Investment Election Changes. Effective July 1, 2004, a Participant may
elect to change the deemed investment of all or a portion of the Participant’s
Account from a deemed investment in Ferro Common Stock to a deemed investment in
the cash account (as described in Section 6.4(A) and (B) above), and vice versa.
As of the effective date of a Participant’s investment election change, the
Participant’s Account will be valued and adjusted in accordance with the
procedures set forth in the preceding paragraph (C) to reflect the new deemed
investment(s). Further, the Participant may elect to change the initial
investment of all or a portion of the Participant’s future Supplemental Matching
Contributions or future Supplemental Basic Pension Contributions, or both. Any
investment election change by a Participant must be made in accordance with, and
will be effective as provided in, procedures established by the Plan
Administrator. Notwithstanding any provision of this Section to the contrary,

 

  (1) any Participant who is subject to Ferro Common Stock ownership
requirements must satisfy those requirements both before and after any change in
the deemed investment of the Participant’s Account or of future Supplemental
Matching or Basic Pension Contributions, and

 

  (2) no Participant may elect to change the deemed investment of any portion of
the Participant’s Account or of future Supplemental Matching or Basic Pension
Contributions if the change is prohibited by law or if any liability would
result to the Participant or any Ferro Group Company.

Unless and until the Participant elects to change or to direct the investment of
the Participant’s Account or future Supplemental Matching or Basic Pension
Contributions pursuant to this Section 6.4(D), those amounts will be deemed to
be invested as provided in Section 6.4(A) and (B) above.

 

6.5 Bookkeeping Account Only. A Participant’s Account is solely for the purpose
of measuring the amounts to be paid under this Plan. The Ferro Group Companies
will not fund or secure, and will not be permitted to fund or secure, the
Account in any way, and the Ferro Group Companies’ obligation to the
Participants under this Plan is solely contractual.

 

A-10

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

ARTICLE VII

TRUST

 

7.1 Establishment of Trust. Notwithstanding any other provision or
interpretation of this Plan, Ferro may establish a Trust in which to hold cash,
insurance policies or other assets that may be used to make, or reimburse Ferro
or any other Ferro Group Company for, payments to the Participants or
Beneficiaries of all or part of the benefits under this Plan. Any Trust assets
shall at all times remain subject to the claims of the general creditors of
Ferro or the Ferro Group Company in the event of the insolvency of Ferro or the
Ferro Group Company as more fully described in the Trust.

 

7.2 Obligation of the Ferro Group Companies. Notwithstanding the fact that a
Trust may be established under Section 7.1, the Ferro Group Companies will
remain liable for paying the benefits under this Plan. However, any payment of
benefits to a Participant or Beneficiary made by a Trust will satisfy the
appropriate Ferro Group Company’s obligation to make payment to such person
under this Plan.

 

7.3 Trust Terms. A Trust established under Section 7.1 may contain any terms as
Ferro may determine to be necessary or desirable. Ferro may terminate or amend a
Trust established under Section 7.1 at any time, and in any manner it deems
necessary or desirable, subject to the terms of any agreement under which any
Trust is established or maintained.

ARTICLE VIII

ADMINISTRATION AND CLAIMS PROCEDURE

 

8.1 Administrator. The Administrator will be Ferro, acting by and through
Ferro’s Corporate Human Resources Department, unless the Board of Directors,
acting itself or through an appropriate committee designates otherwise.

 

8.2 General Rights, Powers, and Duties of Administrator. The Administrator will
be the Plan administrator under ERISA. The Administrator will be responsible for
the general administration of this Plan and will have all powers as may be
necessary to carry out the provisions of this Plan and may, from time to time,
establish rules for the administration of this Plan and the transaction of this
Plan’s business. In addition to any powers, rights and duties set forth
elsewhere in this Plan, it will have the following powers and duties:

 

  (A) To enact rules, regulations, and procedures and to prescribe the use of
such forms as it deems advisable;

 

  (B) To appoint or employ agents, attorneys, actuaries, accountants, assistants
or other persons (who may also be Participants in this Plan or be employed by or
represent a Ferro Group Company) at the expense of the Ferro Group Companies, as
it deems necessary to keep its records or to assist it in taking any other
action authorized or required under this Plan;

 

  (C) To interpret this Plan, and to resolve ambiguities, inconsistencies and
omissions, to determine any question of fact, to determine the right to benefits
of, and the amount of benefits, if any, payable to, any person in accordance
with the provisions of this Plan and resolve all questions arising under this
Plan;

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

  (D) To administer this Plan in accordance with its terms and any rules and
regulations it establishes; and

 

  (E) To maintain records concerning this Plan as it deems sufficient to prepare
reports, returns and other information required by this Plan or by law; and

 

  (F) To direct a Ferro Group Company to pay benefits under this Plan and to
give other directions and instructions as may be necessary for the proper
administration of this Plan.

Any decision, interpretation or other action made or taken by the Administrator
arising out of or in connection with this Plan, will be within the absolute
discretion of the Administrator, and will be final, binding and conclusive on
Ferro, all other Ferro Group Companies, and all Participants and Beneficiaries
and their respective heirs, executors, administrators, successors and assigns.
The Administrator’s determinations under this Plan need not be uniform, and may
be made selectively among Participants, whether or not they are similarly
situated.

 

8.3 Information to Be Furnished to the Administrator. A Ferro Group Company will
furnish the Administrator with such data and information as it may reasonably
require. The records of a Ferro Group Company will be determinative of each
Participant’s period of employment, termination of employment, personal data,
Compensation, and data regarding the contributions made for or on behalf of the
Participant under the Ferro SSOP. Participants and their Beneficiaries will
furnish to the Administrator such evidence, data or information and execute such
documents as the Administrator requests.

 

8.4 Claim for Benefits. A Participant or Beneficiary will make all claims for
payment under this Plan in writing to the Administrator in the manner prescribed
by the Administrator. The Administrator will process each claim and determine
entitlement to benefits within 90 days after the Administrator receives a
completed application for benefits. If the Administrator needs an extension of
time for processing, then the Administrator will notify the claimant before the
end of the initial 90-day period. The extension notice will indicate the special
circumstances requiring an extension of time and the date as of which the
Administrator expects to render the final decision. In no event will such an
extension exceed 90 days from the end of the initial period.

 

8.5 Denial of Benefit. If a claim is wholly or partially denied by the
Administrator, then the Administrator will notify the claimant of the denial of
the claim in a writing delivered in person or mailed by first class mail to the
claimant’s last known address. The notice of denial will contain:

 

  (A) the specific reason or reasons for denial of the claim;

 

  (B) a reference to the relevant Plan provisions upon which the denial is
based;

 

  (C) a description of any additional material or information necessary for the
claimant to perfect the claim, together with an explanation of why the material
or information is necessary; and

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

  (D) an explanation of this Plan’s claim review procedure.

If no notice is provided, the claim will be deemed denied. The interpretations,
determinations and decisions of the Administrator will be final and binding upon
all persons with respect to any right, benefit and privilege hereunder, subject
to the review procedures set forth in this Article.

 

8.6 Request for Review of a Denial of a Claim for Benefits. Any claimant or any
authorized representative of the claimant whose claim for benefits under this
Plan has been denied or deemed denied, in whole or in part, may upon written
notice to the Appeals Committee request a review by the Appeals Committee of the
denial of the claim. The claimant will have 60 days from the date the claim is
deemed denied or 60 days from receipt of the notice denying the claim, as the
case may be, in which to request a review by written application delivered to
the Appeals Committee, which must specify the relief requested and the reason
such claimant believes the denial should be reversed.

 

8.7 Appeals Procedure. The Appeals Committee will review the facts and relevant
documents including this Plan, and interpret the facts and relevant documents
including this Plan to render a decision on the claim. The review may be of
written briefs submitted by the claimant, or at a hearing, or by both, as deemed
necessary or appropriate by the Appeals Committee. Any hearing will be held in
the main office of Ferro, or such other location as the Appeals Committee may
select, on the date and at the time as the Appeals Committee designates by
giving at least 15-days’ notice to the claimant, unless the claimant accepts
shorter notice. The notice will specify that the claimant must indicate in
writing, at least five days in advance of the hearing, the claimant’s intention
to appear at the appointed time and place, or the hearing will be automatically
cancelled. The reply will specify any other persons who will accompany the
claimant to the hearing, or such other persons will not be admitted to the
hearing. The Appeals Committee will make every effort to schedule the hearing on
a day and at a time that is convenient to both the claimant and the Appeals
Committee. The claimant, or his duly authorized representative, may review all
pertinent documents relating to the claim in preparation for the hearing and may
submit issues and comments in writing before or during the hearing.

 

8.8 Decision Upon Review of Denial of Claim for Benefits. In making its
decision, the Appeals Committee will have full power and discretion to interpret
this Plan, to resolve ambiguities, inconsistencies and omissions, to determine
any question of fact, and to determine the right to benefits of, and the amount
of benefits, if any, payable to, any person in accordance with the provisions of
this Plan. The Appeals Committee will render a decision on the claim reviewed no
more than 60 days after the receipt of the claimant’s request for review, unless
special circumstances (such as the need to hold a hearing) require an extension
of time, in which case the 60-day period may be extended up to 120 days. The
Appeals Committee will provide written notice of its decision to the claimant
within the time frame specified. The notice will include the specific reasons
for the decision and contain specific references to the relevant Plan provisions
upon which the decision is based. If notice of the decision is not provided
within the time frame specified, the claim will be deemed denied on review. The
decision of the Appeals Committee will be final and binding in all respects on
the Administrator, the Ferro Group Company and claimant involved.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

8.9 Establishment of Appeals Committee. The Chief Executive Officer of Ferro
will appoint three or more persons to serve as members of the Appeals Committee.
The Chief Executive Officer may appoint one Appeals Committee to hear all
appeals of denied benefits that arise under this Plan, or may appoint a new
Appeals Committee each time an Appeals Committee is needed to hear an appeal of
denied benefits that arises under this Plan. The members of the Appeals
Committee will remain in office at the will of the Chief Executive Officer, and
the Chief Executive Officer may remove any of the members with or without cause.
A member of the Appeals Committee may resign upon written notice to the
remaining member or members of the Appeals Committee and to the Chief Executive
Officer, respectively. The fact that a person is a Participant or a former
Participant or a prospective Participant will not disqualify that person from
acting as a member of the Appeals Committee. No member of the Appeals Committee
will be disqualified from acting on any question because of the member’s
interest in the question, except that no member of the Appeals Committee may act
on any claim which the member has brought as a Participant, former Participant,
or Beneficiary under this Plan. In case of the death, resignation or removal of
any member of the Appeals Committee, the remaining members will act until a
successor-member is appointed by the Chief Executive Officer. At the
Administrator’s request, the Chief Executive Officer will notify the
Administrator in writing of the names of the members of the Appeals Committee,
of any and all changes in the membership of the Appeals Committee, of the member
designated as Chairman, and the member designated as Secretary, and of any
changes in either office. Until notified of a change, the Administrator will be
protected in assuming that there has been no change in the membership of the
Appeals Committee or the designation of Chairman or of Secretary since the last
notification was filed with it. The Administrator will be under no obligation at
any time to inquire into the membership of the Appeals Committee or its
officers. All communications to the Appeals Committee will be addressed to its
Secretary at the address of the Company.

 

8.10 Operation of the Appeals Committee. On all matters and questions, the
decision of a majority of the members of the Appeals Committee will govern and
control. A meeting need not be called or held to make any decision. The Appeals
Committee will appoint one of its members to act as its Chairman and another
member to act as Secretary. The terms of office of these members will be
determined by the Appeals Committee, and the Secretary and/or Chairman may be
removed by the other members of the Appeals Committee for any reason which such
other members may deem just and proper. The Secretary will do all things
directed by the Appeals Committee. Although the Appeals Committee will act by
decision of a majority of its members as provided above, in the absence of
written notice to the contrary, every person may deal with the Secretary and
consider the Secretary’s acts as having been authorized by the Appeals
Committee. Any notice served or demand made on the Secretary will be deemed to
have been served or made upon the Appeals Committee.

 

8.11 Limitation of Duties. Ferro, the other Ferro Group Companies, the
Administrator, the Appeals Committee, and their respective officers, members,
employees and agents will have no duty or responsibility under this Plan other
than the duties and responsibilities expressly assigned or delegated to them
pursuant to this Plan. None of them will have any duty or responsibility with
respect to those duties or responsibilities assigned or delegated to another.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

8.12 Agents. The Administrator and the Appeals Committee may hire any attorneys,
accountants, actuaries, agents, clerks, and secretaries as it may deem desirable
in the performance of its duties, any of whom may also be advisors to any Ferro
Group Company or any subsidiary or affiliated company.

 

8.13 Expenses of Administration. No fee or compensation will be paid to the
Administrator or any member of the Appeals Committee for their performance of
services as such. Ferro will bear all other expenses incurred in the
administration of this Plan except to the extent Ferro determines that the
expenses are allocable to, and should be paid by, one or more of the Ferro Group
Companies.

 

8.14 Indemnification. In addition to whatever rights of indemnification any
member or employee of the Administrator, the Appeals Committee, Ferro or other
Ferro Group Company under this Plan may be entitled to under the articles of
incorporation, regulations or bylaws of the Ferro Group Companies, under any
provision of law or under any other agreement, the Ferro Group Companies will
satisfy any liability actually incurred by any member or employee including
reasonable expenses and attorneys’ fees, and any judgments, fines, and amounts
paid in settlement, in connection with any threatened, pending or completed
action, suit or proceeding which is related to the exercise or failure to
exercise by any member or employee any powers, authority, responsibilities or
discretion provided under this Plan or reasonably believed by a member or
employee to be provided under this Plan, and any action taken by a member or
employee in connection with such exercise or failure to exercise. This
indemnification for all such acts taken or omitted is intentionally broad, but
will not provide indemnification for embezzlement or diversion of Plan funds for
the benefit of any member or employee. This indemnification will not be provided
for any claim by a Ferro Group Company or a subsidiary or affiliated company
thereof against any member or employee. No indemnification will be provided to
any person who is not an individual.

 

8.15 Limitation of Administrative Liability. Neither Ferro, any Ferro Group
Company, the Administrator, the Appeals Committee, nor any of their members or
employees will be liable for any act taken by such person or entity pursuant to
any provision of this Plan except for gross abuse of the discretion given them
under this Plan. No member of the Administrator or Appeals Committee will be
liable for the act of any other member. No member of the Board of Directors will
be liable to any person for any action taken or omitted in connection with the
administration of this Plan.

 

8.16 Limitation of Sponsor Liability. Any right or authority exercisable by
Ferro or Board of Directors pursuant to any provision of this Plan will be
exercised in Ferro’s capacity as sponsor of this Plan, or on behalf of Ferro in
such capacity, and not in a fiduciary capacity, and may be exercised without the
approval or consent of any person in a fiduciary capacity. Neither Ferro, nor
the Board of Directors, nor any of their respective officers, members,
employees, agents and delegates, will have any liability to any party for its
exercise of any such right or authority.

ARTICLE IX

AMENDMENT AND TERMINATION

 

9.1

Amendment, Modification and Termination. Subject to Section 9.4 below, this Plan
may be amended, modified or terminated by Ferro at any time, or from time to
time, by action of an appropriate Ferro officer authorized or ratified by the
Board of Directors. No amendment, modification or termination will be effective
if it reduces the

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

  amounts credited to any Participant’s Account or adversely affects the right
of any Participant or Beneficiary to receive payment of the Account as provided
under this Plan, determined as of the date of the amendment, unless an
equivalent benefit is provided under another plan or program sponsored by the
Company or an Affiliate.

The prior provisions notwithstanding, this Plan may be amended to:

 

  (1) reduce or eliminate the ability for contributions to be credited to
Participants under this Plan;

 

  (2) reduce or eliminate the future deemed interest or earnings credited to the
amounts held in a Participant’s Account;

 

  (3) comply with any law; or

 

  (4) preserve the intended deferral of taxation for the benefit of all
Participants Accounts.

 

9.2 Effect of Amendment on Distributions. If this Plan is amended to terminate
the Plan or to prohibit future contributions under the Plan, the Accounts of
Participants who have not incurred a Termination of Employment will become will
be 100% vested as of the date of the termination of the Plan or prohibition of
future contributions under the Plan.

 

9.3 Actions Binding on Ferro Group Companies. Any amendments made to this Plan
will be binding on all the Ferro Group Companies without the approval or consent
of the Ferro Group Companies other than Ferro. Ferro may, by amendment, also
terminate this Plan on behalf of all or any one of the other Ferro Group
Companies in its sole discretion.

 

9.4 Termination or Amendment After Change in Control. If a Change in Control
occurs, then, for a period of two (2) calendar years following such Change in
Control, Ferro may not amend or terminate this Plan without the prior written
consent of all Participants.

ARTICLE X

FERRO GROUP COMPANIES

 

10.1 List of Ferro Group Companies. The Ferro Group Companies as of the
Amendment and Restatement Date are Ferro and the Affiliates of Ferro listed on
Appendix B to this Plan. Ferro may from time to time add or remove Ferro
Affiliates from the list of Ferro Group Companies by written action of its Chief
Executive Officer. The addition or deletion will not require a formal amendment
to this Plan.

 

10.2 Delegation of Authority. Ferro is fully empowered to act on behalf of
itself and the other Ferro Group Companies as it may deem appropriate in
maintaining this Plan and any Trust. The adoption by Ferro of any amendment to
this Plan or any Trust, or the termination of this Plan or any Trust, will
constitute and represent, without any further action on the part of any Ferro
Group Company, the approval, adoption, ratification or confirmation by each
Ferro Group Company of any amendment or termination. In addition, the
appointment of or removal by Ferro of any Administrator, any trustee or other
person under this Plan or any Trust will constitute and represent, without any
further action on the part of any Ferro Group Company, the appointment or
removal by each Ferro Group Company of such person.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

ARTICLE XI

MISCELLANEOUS

 

11.1 No Implied Rights. Neither the establishment of this Plan nor any amendment
of this Plan will be construed as giving any Participant, Beneficiary or any
other person any legal or equitable right unless the right is specifically
provided for in this Plan or conferred by specific action of Ferro in accordance
with the terms and provisions of this Plan. Except as expressly provided in this
Plan, neither Ferro nor any other Ferro Group Company will be required or be
liable to make any payment under this Plan.

 

11.2 No Right to Ferro Group Company Assets. Neither the Participant nor any
other person will acquire by reason of this Plan any right in or title to any
assets, funds or property of Ferro or any other Ferro Group Company whatsoever
including, without limitation, any specific funds, assets or other property
which Ferro or any other Ferro Group Company, in its sole discretion, may set
aside in anticipation of a liability hereunder. Any benefits which become
payable under this Plan will be paid from the general assets of the appropriate
Ferro Group Company. No assets of Ferro or any other Ferro Group Company will be
held in any way as collateral security for the fulfilling of the obligations of
Ferro or the Ferro Group Companies under this Plan. No assets of Ferro or any
other Ferro Group Company will be pledged or otherwise restricted in order to
meet the obligations of this Plan. The Participant will have only a contractual
right to the amounts, if any, payable hereunder unsecured by any asset of Ferro
or any other Ferro Group Company. Nothing contained in this Plan constitutes a
guarantee by Ferro or any other Ferro Group Company that the assets of Ferro or
any other Ferro Group Company will be sufficient to pay any benefit to any
person.

 

11.3 No Employment Rights Created. This Plan will not be deemed to constitute a
contract of employment between Ferro or any of the other Ferro Group Companies
and any Participant, or to confer upon any Participant or employee the right to
be retained in the service of Ferro or any other Ferro Group Company for any
period of time, nor shall any provision of this Plan restrict the right of Ferro
or any other Ferro Group Company to discharge or otherwise deal with any
Participant or other employees, with or without cause. Nothing in this Plan will
be construed as fixing or regulating the compensation or other benefits payable
to any Participant or other employee of Ferro or any other Ferro Group Company.

 

11.4 Offset. If at the time payment is to be made under this Plan the
Participant or the Beneficiary or both are indebted or obligated to a Ferro
Group Company, then the payment to be made to the Participant or the Beneficiary
or both may, at the discretion of the Administrator at the request of the Ferro
Group Company, be reduced by the amount of the indebtedness or obligation,
provided, however, that an election by the Ferro Group Company not to request
any reduction will not constitute a waiver of the Ferro Group Company’s claim
for such indebtedness or obligation.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

11.5 No Assignment. Neither the Participant nor any other person will have any
voluntary or involuntary right to commute, sell, assign, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate or convey, in advance of
actual receipt of the amount, if any, payable under this Plan, or any part of
the amount payable from this Plan, and any attempt to do so will be void. All
benefits or amounts credited to Accounts under this Plan are expressly declared
to be unassignable and non-transferable. No part of the benefits or amounts
credited to Accounts under this Plan will be, before actual payment, subject to
seizure or sequestration for the payment of any debts, judgments, alimony or
separate maintenance owed by the Participant or any other person, or be
transferable by operation of law in the event of the Participant’s or any other
person’s bankruptcy or insolvency.

 

11.6 Notice. Any notice required or permitted to be given under this Plan will
be sufficient if in writing and hand delivered, or sent by registered or
certified mail or by overnight delivery service, and:

 

  (A) if given to a Ferro Group Company, delivered to the principal office of
Ferro, directed to the attention of the General Counsel; or

 

  (B) if given to a Participant or Beneficiary, delivered to the last post
office address as shown on the Ferro Group Company’s or the Administrator’s
records.

Notice will be deemed given as of the date of delivery or, if delivery is made
by mail, as of the date shown on the postmark or the receipt for registration or
certification.

 

11.7 Governing Laws. This Plan will be construed and administered according to
the internal substantive laws of the State of Ohio to the extent not preempted
by the laws of the United States of America.

 

11.8 Incapacity. If the Administrator determines that any Participant or
Beneficiary entitled to payment under this Plan is a minor, a person declared
incompetent or a person incapable of handling his or her property, the
Administrator may direct any payment to the guardian, legal representative or
person having the care and custody of the minor, incompetent or incapable
person. The Administrator may require proof of minority, incompetence,
incapacity or guardianship, as it may deem appropriate before making any
payment. The Administrator will have no obligation thereafter to monitor or
follow the application of amounts so paid. Payments made pursuant to this
Section will completely discharge this Plan, any Trust, the Administrator, Ferro
and all other Ferro Group Companies with respect to the payments.

 

11.9 Court Ordered Distributions. The Administrator is authorized to make any
payments directed by court order in any action in which this Plan or the
Administrator is named as a party. In addition, if a court determines that a
spouse or former spouse or dependent or former dependent of a Participant has an
interest in the Participant’s Account under this Plan in connection with a
property settlement or otherwise, the Administrator, in its sole discretion,
will have the right, notwithstanding any election made by a Participant, to
immediately distribute the spouse’s or former spouse’s or dependent’s or former
dependent’s interest in the Participant’s Account under this Plan to that spouse
or former spouse or dependent or former dependent.

 

11.10 Administrative Forms. All applications, elections and designations in
connection with this Plan made by a Participant or Beneficiary will become
effective only when duly executed on forms provided by the Administrator and
filed with the Administrator.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

 

 

11.11 Independence of Plan. Except as otherwise expressly provided, this Plan
will be independent of, and in addition to, any other employee benefit agreement
or plan or any rights that may exist from time to time under any other agreement
or plan.

 

11.12 Responsibility for Legal Effect. Neither Ferro, any other Ferro Group
Company, the Administrator, nor any officer, member, delegate or agent of any of
them, makes any representations or warranties, express or implied, or assumes
any responsibility concerning the legal, tax, or other implications or effects
of this Plan.

 

11.13 Successors. The terms and conditions of this Plan will inure to the
benefit of and bind Ferro, the Ferro Group Companies, the Administrator and its
members, the Participants, their Beneficiaries, and the successors, assigns, and
personal representatives of any of them.

 

11.14 Headings and Titles. The Section headings and titles of Articles used in
this Plan are for convenience of reference only and are not to be considered in
construing this Plan.

 

11.15 Appendices. The Appendices to this Plan constitute an integral part of
this Plan and are hereby incorporated into this Plan by this reference.

 

11.16 Severability. If any provision or term of this Plan, or any agreement or
instrument required by the Administrator, is determined by a judicial,
quasi-judicial or administrative body to be void or not enforceable for any
reason, all other provisions or terms of this Plan or the agreement or
instrument will remain in full force and effect and will be enforceable as if
the void or nonenforceable provision or term had never been a part of this Plan,
or the agreement or instrument.

 

11.17 Actions by Ferro. Except as otherwise provided in this Plan, all actions
of Ferro under this Plan will be taken by the Board of Directors, and be
evidenced in a writing executed by an appropriate officer duly authorized.

 

11.18 Spousal Consent and Release. If, in the opinion of Ferro, any present,
former or future spouse of an employee entitled to benefits from this Plan shall
by reason of law appear to have any interest in the Plan benefits that may be or
become payable hereunder to such employee, Ferro may as a condition precedent to
the making of a benefit payment hereunder, require such written consent or
release as in its discretion it shall determine to be necessary, desirable or
appropriate either to prevent or avoid any conflict or multiplicity of claims,
or to protect the rights of any such present, former or future spouse with
respect to the payment of any benefits under this Plan.

 

11.19 Overpayments and Repayments. In the event that Ferro determines that the
benefits actually paid under this Plan exceed the benefits that were properly
payable to a Participant or Beneficiary pursuant to this Plan, Ferro may
exercise any legal remedies available.

 

11.20 References to Sections of Law. References herein to the Code are to the
Internal Revenue Code of 1986, as heretofore and hereafter amended, and to
similar provision of subsequent federal law. References herein to ERISA are to
the Employee Retirement Income Security Act of 1974, as heretofore and hereafter
amended, and to similar provisions of subsequent law.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix A

 

DEFINITIONS

For purposes of this Plan, the following terms have the meanings set forth below
where used in this Plan and identified with initial capital letters:

 

Term    Meaning Account    For each Participant the bookkeeping account
maintained by Ferro to reflect the Participant’s Supplemental Matching
Contributions, Supplemental Basic Pension Contributions, and the deemed
investment return on those amounts. A Participant’s Account will not constitute
nor be treated as a trust fund of any kind. Administrator    As defined in
Section 8.1 of this Plan. Affiliate    Any entity which is a member of a
controlled group of corporations with the Company under Section 414(b) of the
Code, under common control with the Company under Section 414(c) of the Code, a
member of an affiliated service group with the Company under Section 414(m) of
the Code, or otherwise required to be aggregated with the Company under Section
414(o) of the Code.

Amendment and

Restatement Date

   June 30, 2004. Beneficial Owner    “Beneficial owner” within the meaning of
Rule 13d-3 under the Exchange Act. Beneficiary    As defined in Section 5.6 of
this Plan. Board of Directors    Ferro’s Board of Directors. Change in Control
   A change in the control of Ferro that is required to be reported in response
to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange
Act. For purposes of this definition, a Change in Control will be deemed to have
occurred if and when:   

(a)     any “person” (as such term is used in Sections 13(d)(3) and 14(d)(2) of
the Exchange Act) is or becomes the beneficial owner, directly or indirectly, of
securities of Ferro representing twenty-five percent (25%) or more of the
combined voting power of Ferro’s outstanding voting securities; or

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix A

 

Term    Meaning   

(b)     during any period of two consecutive years, the individuals set forth
below in sub-paragraph (1) and (2) cease for any reason to constitute at least a
majority of the Board of Directors:

  

(1)     the individuals who at the beginning of such period constituted the
Board of Directors, and

  

(2)     any new director (other than a director designated by a person who has
entered into an agreement or arrangement with Ferro to effect a transaction
described in clause (a) or (c) of this definition) whose appointment, election,
or nomination for election by Ferro’s shareholders, was approved by a vote of at
least two-thirds of the directors then still in office who either were directors
at the beginning of the period or whose appointment, election or nomination for
election was previously so approved; or

  

(c)     a merger or consolidation of Ferro or one of its subsidiaries is
consummated with or into any other corporation, other than a merger or
consolidation which would result in the holders of the voting securities of
Ferro outstanding immediately prior thereto holding securities which represent
immediately after such merger or consolidation more than 50% of the combined
voting power of the voting securities of either Ferro or the other entity which
survives such merger or consolidation or the parent of the entity which survives
such merger or consolidation; or

  

(d)     a sale or disposition by Ferro of all or substantially all Ferro’s
assets is consummated.

Code    The Internal Revenue Code of 1986, as amended, and any lawful
regulations or other pronouncements promulgated under that Code.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix A

 

Term    Meaning Compensation    “Compensation” as defined under the Ferro SSOP,
but increased to include amounts deferred under the Ferro Corporation Executive
Employee Deferred Compensation Plan [now known as the Ferro Corporation Deferred
Compensation Plan for Executive Employees] and decreased to exclude awards paid
under Ferro’s Performance Share Plan (except that awards paid prior to
January 1, 2007 are included for purposes of determining Supplemental Matching
Contributions), and without regard to any provisions of the Code which limit the
amount of such compensation that can be taken into account for purposes of
determining contributions or benefits.    Specifically, as of the Amendment and
Restatement Date, Compensation under this Plan means compensation (as defined in
Section 415(c)(3) of the Code) paid by a Ferro Group Company to or on behalf of
a Participant while a Participant in the Ferro SSOP during a Plan Year,
including all wages and salary, commissions, bonuses, accrued vacation pay,
401(k) Contributions contributed under the Ferro SSOP, elective employer
contributions made on behalf of the Participant that are not includible in gross
income under Section 125, 129, 132(f), 402(e)(3), 402(h)(1)(B), 403 and 457 of
the Code, and deferred amounts under the Ferro Corporation Executive Employee
Deferred Compensation Plan [now known as the Ferro Corporation Deferred
Compensation Plan for Executive Employees], but excluding relocation expense
reimbursements (including mortgage interest differentials) or other expense
allowances or fringe benefits which are paid with respect to a period following
termination of employment, automobile allowance income, foreign service
premiums, awards paid under Ferro’s Performance Share Plan, and any other
extraordinary income, allowance, and welfare benefits. The prior sentence
notwithstanding, awards paid prior to January 1, 2007 under Ferro’s Performance
Share Plan will be included in Compensation for purposes of determining a
Participant’s Supplemental Matching Contribution. Disability    Any disability
that qualifies a Participant for payment of benefits under a Ferro Group Company
long-term disability plan. The determination of whether a Participant suffers a
Disability will be made by the Ferro Group Company long-term disability plan.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix A

 

Term    Meaning ERISA    The Employee Retirement Income Security Act of 1974, as
amended, and any lawful regulations or pronouncements issued under that Act.
Exchange Act    The Securities Exchange Act of 1934, as amended, and any lawful
regulations or pronouncements issued under that Act. Ferro    As defined in
Section 1.2 of this Plan. Such term also includes any successor corporation or
business organization that subsequently assumes Ferro’s duties and obligations
under this Plan. Ferro Common Stock    The Common Stock of Ferro, par value
$1.00 per share. Ferro Group Companies    As defined in Section 10.1 of this
Plan. Ferro SSOP    Ferro’s Savings and Stock Ownership Plan, as the same may be
amended from time to time. 401(k) Contributions    Pre-tax contributions made to
the Ferro SSOP pursuant to Code Section 401(k). Highly Compensated Employee   
An employee of a Ferro Group Company who is in Salary Grade 22 or higher and for
whom contributions under the Ferro SSOP are limited due to the provisions of
Section 401(a)(17), 401(k), 401(m), 402(g) or 415 of the Code. Participant    A
Highly Compensated Employee of a Ferro Group Company who becomes a Participant
pursuant to Section 3.2 of this Plan. A Participant will cease to be a
Participant, and shall become a former Participant, upon the earliest of the
following:   

(a)     Termination of Employment,

  

(b)     the date the employee ceases to be a Highly Compensated Employee, or

  

(c)     the date the employee’s participation in this Plan is terminated by the
Administrator pursuant to Section 5.7 of this Plan or otherwise.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix A

 

Term    Meaning Person   

A “person” as defined under Section 3(a)(9) of the Exchange Act as modified and
used in Sections 13(d) and 14(d) of the Exchange Act, excluding:

 

(a)     Ferro or any of its subsidiaries;

 

(b)     a trustee or other fiduciary holding securities under an employee
benefit plan of the Company (or of any of its affiliates as defined under Rule
12b-2 under Section 12 of the Exchange Act);

 

(c)     an underwriter temporarily holding securities pursuant to an offering of
such securities; or

 

(d)     a corporation owned, directly or indirectly, by the shareholders of
Ferro in substantially the same proportion as their ownership of the stock of
Ferro.

this Plan    As defined in the Introduction to this Plan. Plan Year    The
calendar year. Termination of Employment    A Participant’s cessation of service
with Ferro and the other Ferro Group Companies, including Affiliates of the
foregoing, for any reason whatsoever, whether voluntarily or involuntarily,
including by reason of retirement, death, or Disability. Trust    The trust, if
any, established pursuant to Section 7.1 of this Plan. Valuation Date   

The last day of each quarter in the Plan Year and any other date or dates Ferro,
in its sole discretion, designates from time to time.

 

For purposes of determining the value of a Participant’s Account for
distribution, the Valuation Date is the last day of the month in which occurs
the Participant’s Termination of Employment, death, or commencement of long-term
disability benefits on account of a determination of Disability under a Ferro
Group Company long-term disability plan.

Years of Vesting Service    The years of vesting service with which a
Participant is credited under the Ferro SSOP.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix B

FERRO GROUP COMPANIES

The following are the Ferro Group Companies:

Ferro Corporation

FEM Inc.

Ferro Glass & Color Corporation

Ferro International Services, Inc.

Ferro Pfanstiehl Laboratories, Inc.

 

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix C

Amendment to Change

Definition of Compensation*

Effective June 30, 2004, the definition of “Compensation” is hereby deleted and
a new definition of “Compensation” is substituted in lieu thereof, to read as
follows:

 

Compensation    “Compensation” as defined under the Ferro SSOP, but increased to
include amounts deferred under the Ferro Corporation Executive Employee Deferred
Compensation Plan [now known as the Ferro Corporation Deferred Compensation Plan
for Executive Employees] and decreased to exclude the awards paid under Ferro’s
Performance Share Plan (except that the cash portion of awards paid prior to
January 1, 2007 are included for purposes of determining Supplemental Matching
Contributions), and without regard to any provisions of the Code which limit the
amount of such compensation that can be taken into account for purposes of
determining contributions or benefits.    Specifically, as of the Amendment and
Restatement Date, Compensation under this Plan means compensation (as defined in
Section 415(c)(3) of the Code) paid by a Ferro Group Company to or on behalf of
a Participant while a Participant in the Ferro SSOP during a Plan Year,
including all wages and salary, commissions, bonuses, accrued vacation pay,
401(k) Contributions contributed under the Ferro SSOP, elective employer
contributions made on behalf of the Participant that are not includible in gross
income under Section 125, 129, 132(f), 402(e)(3), 402(h)(1)(B), 403 and 457 of
the Code, and deferred amounts under the Ferro Corporation Executive Employee
Deferred Compensation Plan [now known as the Ferro Corporation Deferred
Compensation Plan for Executive Employees], but excluding relocation expense
reimbursements (including mortgage interest differentials) or other expense
allowances or fringe benefits which are paid with respect to a period following
termination of employment, automobile allowance income, foreign service
premiums, awards paid under Ferro’s Performance Share Plan, and any other
extraordinary income, allowance, and welfare benefits. The prior sentence
notwithstanding, the cash portion of awards paid prior to January 1, 2007 under
Ferro’s Performance Share Plan will be included in Compensation for purposes of
determining a Participant’s Supplemental Matching Contribution.

 

* Amendment effective June 30, 2004.

 

A-26

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Part A - Pre-2005 Plan

As Amended and Restated June 30, 2004

Appendix D

Amendment to Change

Notional Investment Measure*

ARTICLE VI:

Effective January 1, 2006, a new Paragraph (E) is added to the end of
Section 6.4 to read as follows:

 

  (E) Rate of Return of Cash Account. Effective January 1, 2006, notwithstanding
any provision of Section 6.4 to the contrary, amounts credited to a cash account
under the Plan will be deemed to earn interest at a fixed quarterly percentage,
which interest rate shall equal three percent (3%) above the 10-Year Constant
Maturity Rate issued by the Board of Governors of the Federal Reserve System for
the last month of the preceding calendar quarter, provided that Ferro determines
that such rate is reasonable at the time it is established. In the event Ferro
determines that such rate is not reasonable at the time it is established, Ferro
shall instead establish a lesser fixed quarterly percentage.

 

* Amendment effective January 1, 2006.

 

A-27

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FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

PART B: 2005 PLAN

OVERVIEW

ESTABLISHMENT OF COMPONENT PLAN

The provisions of the Code Section 409A component plan are set forth in this
Part B (the “2005 Plan”), which is adopted and made a part of the Plan effective
January 1, 2005.

GOVERNS BENEFITS SUBJECT TO CODE SECTION 409A

The 2005 Plan governs all benefits under the Plan which are not Pre-2005
Benefits (the “409A Benefits”). This means that the 2005 Plan governs amounts
which are earned or vested under the Plan after December 31, 2004, plus any
income attributable to such amounts or to such income.

The 409A Benefits are subject to the requirements of Code Section 409A, and
Ferro intends for the 2005 Plan to comply with Code Section 409A. The 2005 Plan
shall be interpreted and administered so as to comply with Code Section 409A.

TERMINOLOGY

The terms of the 2005 Plan are identical to those of the Pre-2005 Plan except to
the extent indicated. Where provisions of the 2005 Plan have been left blank,
they are identical to those of the Pre-2005 Plan as so modified. Where
provisions are not blank, the provided terms substitute in full for the original
provisions of the Pre-2005 Plan.

As used in the 2005 Plan, the term “Plan” refers to the 2005 Plan or to the
Plan, as appropriate.

 

B-1

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FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

 

 

 

Part B: 2005 Plan

Effective January 1, 2005

 

B-2

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Part B - 2005 Plan

Effective January 1, 2005

 

FERRO CORPORATION

SUPPLEMENTAL DEFINED CONTRIBUTION PLAN

FOR EXECUTIVE EMPLOYEES

2005 PLAN

INTRODUCTION

This 2005 Plan is the portion of the FERRO CORPORATION SUPPLEMENTAL DEFINED
CONTRIBUTION PLAN FOR EXECUTIVE EMPLOYEES which governs 409A Benefits. The
purpose for the adoption of this 2005 Plan is to comply with the requirements of
Code Section 409A.

Except as indicated below, the terms of the 2005 Plan are identical to those of
the Pre-2005 Plan as set forth in Part A of this Plan.

The 2005 Plan is hereby added to the Plan effective January 1, 2005, as follows:

ARTICLE I

NAME AND PURPOSE

 

1.1 Name. The name of this Plan is the “Ferro Corporation Supplemental Defined
Contribution Plan for Executives.”

 

1.2 Plan Sponsor. The sponsor of this Plan is Ferro Corporation (“Ferro”), an
Ohio corporation.

 

1.3 Purpose. The purpose of this Plan is to replace, under the conditions set
forth in this Plan, certain benefits that select management and highly
compensated employees of the Ferro Group Companies cannot receive under Ferro
Corporation Savings and Stock Ownership Plan due to limitations imposed by the
Internal Revenue Code or by plan design.

 

1.4 Plan for a Select Group. This Plan is intended to cover only employees of a
Ferro Group Company who are members of a “select group of management or highly
compensated employees” as provided in Sections 201(2), 301(a)(3), 401(a)(1) and
4021(b)(6) of ERISA.

 

1.5 Not a Funded Plan. Ferro intends that this Plan be deemed to be “unfunded”
for tax purposes as well as for purposes of Title I of ERISA.

 

1.6 409A Compliance. This Plan is intended to comply with Section 409A of the
Code and all other applicable laws in order to have the Federal income tax
effect sought for such plans.

 

B-3

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Part B - 2005 Plan

Effective January 1, 2005

 

ARTICLE II

DEFINITIONS AND INTERPRETATION

 

2.1 Definitions. Appendix A sets forth the definitions of certain terms used in
this Plan. Those terms shall have the meanings set forth on Appendix A where
used in this Plan and identified with initial capital letters.

 

2.2 General Rules of Construction. For purposes of interpreting this Plan,

 

  (A) the masculine gender will include the feminine and neuter, and vice versa,
as the context requires;

 

  (B) the singular number will include the plural, and vice versa, as the
context requires;

 

  (C) the present tense of a verb will include the past and future tenses, and
vice versa, as the context requires; and

 

  (D) as provided under Article VIII, the Administrator retains the power and
duty to interpret this Plan and resolve ambiguities.

ARTICLE III

PARTICIPATION

 

3.1 Eligibility. In order to be eligible to participate in this Plan, an
individual must be a Highly Compensated Employee.

 

3.2 Participation. A Highly Compensated Employee will become a Participant in
this Plan on the earlier of the January 1 or January 2 coincident with or next
following the date he or she becomes a Highly Compensated Employee.

ARTICLE IV

SUPPLEMENTAL MATCHING CONTRIBUTIONS,

SUPPLEMENTAL BASIC PENSION CONTRIBUTIONS,

AND ACCOUNTS

 

4.1 Eligibility for Supplemental Matching Contributions.

 

  (A) Pre-2006 Eligibility. Each Plan Year a Supplemental Matching Contribution
will be credited to the Account of each Participant who is eligible. A
Participant will be eligible if the Participant:

 

  (1) made the maximum 401(k) Contributions permitted under the Ferro SSOP
during the Plan Year, and

 

B-4

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Part B - 2005 Plan

Effective January 1, 2005

 

 

  (2) either:

 

  (a) was employed by a Ferro Group Company on the last day of the Plan Year,

 

  (b) died during the Plan Year,

 

  (c) retired and began receiving pension benefits under the Ferro Corporation
Retirement Plan during the Plan Year (or, if not a participant in the Ferro
Corporation Retirement Plan, terminated employment after attaining age 55 and 5
Years of Vesting Service during the Plan Year), or

 

  (d) incurred a Disability during the Plan Year.

 

  (B) Post-2005 Eligibility. Each Plan Year a Supplemental Matching Contribution
will be credited to the Account of each Participant who is eligible. A
Participant will be eligible if the Participant either:

 

  (1) was employed by a Ferro Group Company on the last day of the Plan Year,

 

  (2) died during the Plan Year,

 

  (3) retired and began receiving pension benefits under the Ferro Corporation
Retirement Plan during the Plan Year or terminated employment after attaining
age 55 and 5 Years of Vesting Service during the Plan Year, or

 

  (4) incurred Disability during the Plan Year.

 

4.2 Amount of Supplemental Matching Contributions.

 

  (A) Pre-2006 Supplemental Matching Contributions. An eligible Participant will
receive a Supplemental Matching Contribution on the last day of the Plan Year
equal to 1 minus 2, where:

 

  (1) “1” equals the amount of matching contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
if the Participant elected to make 401(k) Contributions equal to eight percent
(8%) of Compensation and the Code provisions allowed and did not impose a limit
on such 401(k) Contributions or matching contributions; and

 

  (2) “2” equals the amount of matching contributions actually contributed to
the Participant’s account under the Ferro SSOP for the Plan Year.

 

  (B) Post-2005 Supplemental Matching Contributions. An eligible Participant
will receive a Supplemental Matching Contribution on the last day of the Plan
Year equal to 1 minus 2, where:

 

B-5

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

 

 

  (1) “1” equals the amount of matching contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
if the Participant elected to make 401(k) Contributions equal to eight percent
(8%) of Compensation, and the Code provisions allowed and did not impose a limit
on such 401(k) Contributions or matching contributions; and

 

  (2) “2” equals the amount of matching contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
if the Participant elected to make 401(k) Contributions equal to eight percent
(8%) of compensation (as defined under the Ferro SSOP), and subject to the Code
provisions that impose a limit on such 401(k) Contributions or matching
contributions.

 

4.3 Eligibility for Supplemental Basic Pension Contributions. Each Plan Year a
Supplemental Basic Pension Contribution will be credited to the Account of each
Participant who is eligible. A Participant will be eligible if the Participant
received a Basic Pension Contribution under the Ferro SSOP during the Plan Year.
The prior provisions of this Section notwithstanding, effective January 1, 2006,
a Participant will be eligible for a Supplemental Basic Pension Contribution
only if the Participant received a Basic Pension Contribution under the Ferro
SSOP during the Plan Year and either:

 

  (A) is in Salary Grade 25 or higher on the last day of the Plan Year, or

 

  (B) is a Pre-2005 Participant in Salary Grade 22 or higher on the last day of
the Plan Year.

For purposes of this Section, the term “Pre-2005 Participant” means a
Participant who became an employee of a Ferro Group Company on or after July 1,
2003 and before January 1, 2006 at a Salary Grade of 22 or higher.

 

4.4 Amount of Supplemental Basic Pension Contributions.

 

  (A) Pre-2008 Supplemental Basic Pension Contributions. An eligible Participant
will receive a Supplemental Basic Pension Contribution on the last day of the
Plan Year equal to 1 minus 2, where:

 

  (1) “1” equals the amount of Basic Pension Contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
on the basis of the Participant’s Compensation not limited by Code provisions;
and

 

  (2) “2” equals the amount of Basic Pension Contributions actually contributed
to the Participant’s account under the Ferro SSOP for the Plan Year.

 

  (B) Post-2007 Supplemental Basic Pension Contributions. An eligible
Participant will receive a Supplemental Basic Pension Contribution on the last
day of the Plan Year equal to 1 minus 2, where:

 

  (1) “1” equals the amount of Basic Pension Contribution that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
on the basis of the Participant’s Compensation not limited by Code provisions;
and

 

B-6

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Part B - 2005 Plan

Effective January 1, 2005

 

 

  (2) “2” equals the amount of Basic Pension Contributions that would have been
contributed to the Participant’s account under the Ferro SSOP for the Plan Year
on the basis of the Participant’s compensation (defined as base salary or wages
and including vacation, and holiday pay, but excluding all forms of extra
compensation such as overtime premiums, bonuses, commissions, and incentive
compensation, and including elective contributions made by the Participant that
are not includible in gross income under Sections 125, 129, 132(f), 402(e)(3),
402(h)(1)(B), 403(b) and 457 of the Code) and subject to the Code provisions
which impose limits on such compensation, for the Plan Year.

 

4.5 Establishment of Account. Each Ferro Group Company will establish an Account
in the name of each Participant who is employed by it on the books and records
of the Ferro Group Company. All amounts credited to the Account of any
Participant or former Participant will constitute a general, unsecured liability
of such Ferro Group Company to the Participant. The Ferro Group Company will
maintain a separate Account for contributions credited to the Participant prior
to 2001 as may be necessary for the deemed investment of the Participant’s
Account as provided under Section 6.4 below.

 

4.6 Crediting of Earnings. The Ferro Group Company will credit the Account of
each Participant who is or was its employee with earnings, gains and losses in
accordance with the deemed investment of the Supplemental Matching Contributions
and Supplemental Basic Pension Contributions as provided under Section 6.4
below.

 

4.7 Vesting of Account. A Participant will become vested in his or her Account
in accordance with the following schedule:

 

Years of Vesting Service

   Percentage Vested  

Less than 1 year

     0 % 

1 year, but less than 2

     20 % 

2 years, but less than 3

     40 % 

3 years, but less than 4

     60 % 

4 years, but less than 5

     80 % 

5 years or more

     100 % 

The prior provisions notwithstanding, a Participant who has not incurred a
Termination of Employment will be 100% vested in the Account upon the first to
occur of: (a) the Participant’s attainment of age 65, (b) the Participant’s
incurring a Disability, (c) the Participant’s death, or (d) a Change in Control.

 

B-7

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Part B - 2005 Plan

Effective January 1, 2005

 

ARTICLE V

BENEFITS; PAYMENT OF BENEFITS

 

5.1 Date of Distribution. Distribution of the vested portion of the
Participant’s Account will be made as soon as administratively practicable on or
after the earliest of the Participant’s Termination of Employment, Disability or
death. The prior provisions notwithstanding, distribution on account a
Participant’s Termination of Employment shall not be made until the date which
is six (6) months following the Participant’s Termination of Employment
(provided, however, that in the event of the Participant’s death after
Termination of Employment, distribution shall be made on the date of death).
Distribution shall, in any event, be made by the Time Required by Law.

 

5.2 Form of Distribution. Distribution will be in the form of a single lump sum
payment. The portion of the Participant’s Account deemed to be invested in the
Ferro Common Stock Account under Section 6.4 will be distributed in the form of
Ferro Common Stock unless the Participant elects to receive payment of that
portion in cash. The portion of the Participant’s Account deemed to be invested
in the cash account under Section 6.4 will be distributed in the form of cash.

 

5.3 Valuation of Distributions. All distributions under this Plan will be based
upon the amount credited to the Participant’s Account as of the last day of the
month in which occurs the Participant’s Termination of Employment, death, or
commencement of long-term disability benefits on account of a determination of
Disability under a Ferro Group Company long-term disability plan. Such date
shall be the Valuation Date for this purpose. No adjustment shall be made for
any delay in payment, including the six (6) month delay set forth in
Section 5.1.

 

5.4 Death. In the event of death, the Participant’s remaining vested interest in
the Account will be distributed to the Participant’s Beneficiary.

 

5.5 Administration of Distributions. Distributions under this Plan will be made
as soon as administratively possible following receipt of notice by the
Administrator of an event that entitles a Participant or a Beneficiary to
payments under this Plan and completion by the Participant or Beneficiary of any
forms required by the Administrator.

 

5.6 Designation of Beneficiary. Subject to the rules and procedures promulgated
by the Administrator, a Participant may sign a document designating a
Beneficiary or Beneficiaries. If a Participant fails to designate any
Beneficiary in accordance with the provisions of this Section, then the
Beneficiary will be deemed to be the Participant’s beneficiary under the Ferro
SSOP.

 

5.7 Protective Distributions. If the Administrator determines that a Participant
is not a member of a “select group of management or highly compensated
employees” within the meaning of Section 201(2), 301(a)(3), 401(a)(1) or
4021(b)(6) of ERISA, then the Administrator may, as it determines necessary to
satisfy the exclusions from ERISA coverage contemplated by Section 1.4,
terminate the Participant’s participation in this Plan and forfeit any amounts
erroneously credited under this Plan with respect to such Participant.

 

B-8

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Part B - 2005 Plan

Effective January 1, 2005

 

 

5.8 Tax Withholding and Acceleration of Payment for Payment of Taxes. A Ferro
Group Company may withhold, from any payment made by it under this Plan, the
amount or amounts as may be required for purposes of complying with the tax
withholding or other provisions of the Code, the Social Security Act, or any
state or local income or employment tax act or for purposes of paying any
estate, inheritance or other tax attributable to any amounts payable hereunder.
Further, distribution shall be made from the Plan at such time or times as the
Administrator, in its sole discretion pursuant to uniform and nondiscriminatory
procedures, shall determine that amounts are due for the payment of Federal
Insurance Contributions Act taxes imposed under Code Sections 3101, 3121(a), or
3121(v)(2) on the 409A Benefits. Such distribution, if any, shall be made for
the exclusive purpose of paying such Federal Insurance Contributions Act taxes.
In addition, distribution shall be made from the Plan at such time or times as
the Administrator, in its sole discretion pursuant to uniform and
nondiscriminatory procedures, shall determine that amounts are due for the
payment of income tax at source on wages imposed under Code Section 3401 (or the
corresponding withholding provisions of applicable state, local or foreign tax
laws) as a result of the payment of the Federal Insurance Contributions Act
taxes, or are due for the payment of additional income tax at source on wages
attributable to the pyramiding Code Section 3401 wages and taxes. Such
distribution, if any, shall be made for the exclusive purpose of paying such
taxes. In no event shall the amounts distributed pursuant to this Section exceed
the amounts owed for the payment of Federal Insurance Contribution Act and the
income tax withholding related to such amounts.

 

5.9 Lost or Uncooperative Participant. If a Ferro Group Company or the
Administrator notifies a Participant or Beneficiary of an entitlement to an
amount under this Plan and the Participant or Beneficiary fails to request
payment, to provide information or to take any other action to receive payment
of such amount, the Administrator shall, to the extent administratively
possible, direct distribution to be made on an involuntary basis to such person
or persons by the Time Required by Law. If the location of a Participant or
Beneficiary can not be determined after a prompt, reasonable good faith effort
by the Administrator, the Administrator will direct that the amount payable to
the Participant or Beneficiary be forfeited by the Time Required by Law, and no
further benefit will be payable with respect to such Participant or Beneficiary.

 

5.10 Distribution upon Income Inclusion under Code Section 409A and Other
Acceleration Events. The prior provisions of this Article V notwithstanding, in
the event the Plan fails to meet the requirements of Code Section 409A, a
Participant’s 409A Benefits shall be distributed in an amount equal to the
amount which is included in income on account of the failure to comply with Code
Section 409A.

 

5.11 General Restriction on Distribution and Acceleration of Payment.
Notwithstanding any provision of the Plan to the contrary, a Participant’s 409A
Benefits shall not be distributed earlier than the time permitted under Code
Section 409A. Consistent with Code Section 409A, this Plan provides that
distribution shall not be made before the earliest of Termination of Employment,
death or Disability, and imposes a restriction on distribution made on account
of Termination of Employment by which no distribution is made until the
(6) month anniversary of the Termination of Employment.

 

B-9

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Part B - 2005 Plan

Effective January 1, 2005

 

ARTICLE VI

RIGHTS OF PARTICIPANTS

 

6.1 Creditor Status of Participants. The Supplemental Matching Contributions and
Supplemental Basic Pension Contributions credited to a Participant shall be
merely an unfunded, unsecured promise of the Ferro Group Company (by which the
Participant is employed) to make benefit payments in the future and shall be
liabilities solely against the general assets of such Ferro Group Company.
Except as provided in Section 6.6, Ferro and the other Ferro Group Companies
shall not be required to segregate, set aside or escrow the Supplemental
Matching Contributions, Supplemental Basic Pension Contributions nor any
earnings, gains and losses credited thereon. With respect to amounts credited to
any Account hereunder and any benefits payable hereunder, a Participant and
Beneficiary will have the status of general unsecured creditors of the Ferro
Group Company (by which the Participant is employed), and may look only to that
Ferro Group Company and its general assets for payment of the Account.

 

6.2 Rights with Respect to the Trust. Any trust, and any assets held thereby to
assist Ferro or any other Ferro Group Company in meeting its obligations under
this Plan, will in no way be deemed to controvert the provisions of Section 6.1
above.

 

6.3 Investments. In Ferro’s sole discretion, the Ferro Group Companies may
acquire insurance policies, annuities or other financial vehicles for the
purpose of providing future assets of the Ferro Group Companies to meet their
anticipated liabilities under this Plan. Such policies, annuities or other
investments, shall at all times be and remain unrestricted general property and
assets of the Ferro Group Companies or property of a trust established pursuant
to Article VII of this Plan. Participants and Beneficiaries will have no rights,
other than as general creditors, with respect to any such policies, annuities or
other acquired assets.

 

6.4 Method for Crediting Investment Return. The Ferro Group Company by which the
Participant is employed will maintain a separate Account for the Participant. A
Participant’s Account is deemed to be invested as follows.

 

  (A) Post-2000 Contributions. The Supplemental Matching and Supplemental Basic
Pension Contributions credited to a Participant’s Account after December 31,
2000 will be deemed to be invested in Ferro Common Stock as of the date the
contributions are credited under the Plan. The Account will be deemed to receive
all dividends (whether in stock or cash) and stock splits which would be
received if the Account was actually invested in shares of Ferro Common Stock,
and such dividends and stock splits will be deemed to be reinvested in shares of
Ferro Common Stock as of the date of their receipt. Each investment in Ferro
Common Stock will be deemed to be made at the closing sale price of Ferro Common
Stock on the New York Stock Exchange Composite Tape (as reported in The Wall
Street Journal) on the trading day of the deemed investment.

 

  (B)

Pre-2001 Contributions. Only Supplemental Matching Contributions were credited
under the Plan prior to 2001. The Supplemental Matching Contributions credited
to a Participant’s Account prior to 2001 will be deemed to be invested as of the
date the contributions are credited under the Plan in a cash

 

B-10

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

 

  account with a rate of return determined by Ferro. Prior to the beginning of
each Plan Year, Ferro will determine the rate of investment credit for the
following Plan Year. The prior provisions notwithstanding, the Participant was
entitled to elect in writing, during the special election period provided in
2001, for all or a portion of such pre-2001 Supplemental Matching Contributions
to be deemed to instead be invested in Ferro Common Stock. Under any such
election, the Supplemental Matching Contributions designated by the Participant
to be deemed invested in shares of Ferro Common Stock will be deemed invested as
of the date the contributions were credited under the Plan, and otherwise will
be valued and credited with dividends and stock splits, in the same manner as
described in Section 6.4(A) above.

 

  (C) Periodic Adjustment of Accounts. As of each Valuation Date, the
Participant’s Account will be adjusted to reflect earnings and losses on the
deemed investments. To the extent the Account is deemed to be invested in Ferro
Common Stock, it will be credited as of each Valuation Date with hypothetical
appreciation and depreciation and earnings, as computed and determined by the
Administrator based on the value of Ferro Common Stock and its dividends, etc.,
as provided in Section 6.4(A) above. To the extent the Participant’s Account is
deemed to be invested in the cash account, it will be credited as of each
Valuation Date with hypothetical earnings, as computed and determined by the
Administrator using a rate of interest equal to that determined by Ferro prior
to the beginning of the Plan Year as provided in Section 6.4(B) above. The
Administrator will provide each Participant with a statement showing the balance
credited to the Participant’s Account as of the last day of the preceding Plan
Year, and at such other times as the Administrator may elect.

 

  (D) Investment Election Changes. Effective July 1, 2004, a Participant may
elect to change the deemed investment of all or a portion of the Participant’s
Account from a deemed investment in Ferro Common Stock to a deemed investment in
the cash account (as described in Section 6.4(A) and (B) above), and vice versa.
As of the effective date of a Participant’s investment election change, the
Participant’s Account will be valued and adjusted in accordance with the
procedures set forth in the preceding paragraph (C) to reflect the new deemed
investment(s). Further, the Participant may elect to change the initial
investment of all or a portion of the Participant’s future Supplemental Matching
Contributions or future Supplemental Basic Pension Contributions, or both. Any
investment election change by a Participant must be made in accordance with, and
will be effective as provided in, procedures established by the Plan
Administrator. Notwithstanding any provision of this Section to the contrary,

 

  (1) any Participant who is subject to Ferro Common Stock ownership
requirements must satisfy those requirements both before and after any change in
the deemed investment of the Participant’s Account or of future Supplemental
Matching or Basic Pension Contributions, and

 

  (2)

no Participant may elect to change the deemed investment of any portion of the
Participant’s Account or of future Supplemental Matching or Basic Pension
Contributions if the change is prohibited by law or if any liability would
result to the Participant or any Ferro Group Company.

 

B-11

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Part B - 2005 Plan

Effective January 1, 2005

 

  Unless and until the Participant elects to change or to direct the investment
of the Participant’s Account or future Supplemental Matching or Basic Pension
Contributions pursuant to this Section 6.4(D), those amounts will be deemed to
be invested as provided in Section 6.4(A) and (B) above.

 

  (E) Rate of Return of Cash Account. Effective January 1, 2006, notwithstanding
any provision of Section 6.4 to the contrary, amounts credited to a cash account
under the Plan will be deemed to earn interest at a fixed quarterly percentage,
which interest rate shall equal three percent (3%) above the 10-Year Constant
Maturity Rate issued by the Board of Governors of the Federal Reserve System for
the last month of the preceding calendar quarter, provided that Ferro determines
that such rate is reasonable at the time it is established. In the event Ferro
determines that such rate is not reasonable at the time it is established, Ferro
shall instead establish a lesser fixed quarterly percentage.

 

6.5 Bookkeeping Account Only. A Participant’s Account is solely for the purpose
of measuring the amounts to be paid under this Plan. The Ferro Group Companies
will not fund or secure, and will not be permitted to fund or secure, the
Account in any way, and the Ferro Group Companies’ obligation to the
Participants under this Plan is solely contractual.

ARTICLE VII

TRUST

 

7.1 Establishment of Trust. Notwithstanding any other provision or
interpretation of this Plan, Ferro may establish a Trust in which to hold cash,
insurance policies or other assets that may be used to make, or reimburse Ferro
or any other Ferro Group Company for, payments to the Participants or
Beneficiaries of all or part of the benefits under this Plan. Any Trust assets
shall at all times remain subject to the claims of the general creditors of
Ferro or the Ferro Group Company in the event of the insolvency of Ferro or the
Ferro Group Company as more fully described in the Trust.

 

7.2 Obligation of the Ferro Group Companies. Notwithstanding the fact that a
Trust may be established under Section 7.1, the Ferro Group Companies will
remain liable for paying the benefits under this Plan. However, any payment of
benefits to a Participant or Beneficiary made by a Trust will satisfy the
appropriate Ferro Group Company’s obligation to make payment to such person
under this Plan.

 

7.3 Trust Terms. A Trust established under Section 7.1 may contain any terms as
Ferro may determine to be necessary or desirable; provided, however, that, no
terms shall provide for or permit funding that would result in income inclusion
under Code Section 409A(b) including, but not limited to, terms that allow for
the transfer or set aside of assets offshore in a Trust, or which provide for
assets to become restricted to the provision of benefits in connection with a
change in the financial health of Ferro and Affiliates, and any terms which so
provide shall be deemed null and void. Consistent with the foregoing, Ferro may
terminate or amend a Trust established under Section 7.1 at any time, and in any
manner it deems necessary or desirable, subject to the terms of any agreement
under which any Trust is established or maintained.

 

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Part B - 2005 Plan

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ARTICLE VIII

ADMINISTRATION AND CLAIMS PROCEDURE

 

8.1 Administrator. The Administrator will be Ferro, acting by and through
Ferro’s Corporate Human Resources Department, unless the Board of Directors,
acting itself or through an appropriate committee designates otherwise.

 

8.2 General Rights, Powers, and Duties of Administrator. The Administrator will
be the Plan administrator under ERISA. The Administrator will be responsible for
the general administration of this Plan and will have all powers as may be
necessary to carry out the provisions of this Plan and may, from time to time,
establish rules for the administration of this Plan and the transaction of this
Plan’s business. In addition to any powers, rights and duties set forth
elsewhere in this Plan, it will have the following powers and duties:

 

  (A) To enact rules, regulations, and procedures and to prescribe the use of
such forms as it deems advisable;

 

  (B) To appoint or employ agents, attorneys, actuaries, accountants, assistants
or other persons (who may also be Participants in this Plan or be employed by or
represent a Ferro Group Company) at the expense of the Ferro Group Companies, as
it deems necessary to keep its records or to assist it in taking any other
action authorized or required under this Plan;

 

  (C) To interpret this Plan, and to resolve ambiguities, inconsistencies and
omissions, to determine any question of fact, to determine the right to benefits
of, and the amount of benefits, if any, payable to, any person in accordance
with the provisions of this Plan and resolve all questions arising under this
Plan;

 

  (D) To administer this Plan in accordance with its terms and any rules and
regulations it establishes; and

 

  (E) To maintain records concerning this Plan as it deems sufficient to prepare
reports, returns and other information required by this Plan or by law; and

 

  (F) To direct a Ferro Group Company to pay benefits under this Plan and to
give other directions and instructions as may be necessary for the proper
administration of this Plan.

Any decision, interpretation or other action made or taken by the Administrator
arising out of or in connection with this Plan, will be within the absolute
discretion of the Administrator, and will be final, binding and conclusive on
Ferro, all other Ferro Group Companies, and all Participants and Beneficiaries
and their respective heirs, executors, administrators, successors and assigns.
Except as may be required for compliance with Code Section 409A, the
Administrator’s determinations under this Plan need not be uniform, and may be
made selectively among Participants, whether or not they are similarly situated.

 

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Part B - 2005 Plan

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8.3 Information to Be Furnished to the Administrator. A Ferro Group Company will
furnish the Administrator with such data and information as it may reasonably
require. The records of a Ferro Group Company will be determinative of each
Participant’s period of employment, termination of employment, personal data,
Compensation, and data regarding the contributions made for or on behalf of the
Participant under the Ferro SSOP. Participants and their Beneficiaries will
furnish to the Administrator such evidence, data or information and execute such
documents as the Administrator requests.

 

8.4 Claim for Benefits. A Participant or Beneficiary must make a claim for
payment under this Plan in writing to the Administrator in the manner prescribed
by the Administrator as soon as administratively practicable following the
distribution event. The Administrator will process each claim and determine
entitlement to benefits within 90 days after the Administrator receives a
completed application for benefits (or within such shorter period as may be
required to ensure that payment is made by the Time Required by Law). If the
Administrator needs an extension of time for processing because calculation of
the benefit amount is not administratively practicable, then the Administrator
will notify the claimant before the end of the initial period. The extension
notice will indicate the special circumstances requiring an extension of time
and the date as of which the Administrator expects to render the final decision.
In no event will such an extension exceed 90 days from the end of the initial
period.

 

8.5 Denial of Benefit. If a claim is wholly or partially denied by the
Administrator, then the Administrator will notify the claimant of the denial of
the claim in a writing delivered in person or mailed by first class mail to the
claimant’s last known address. The notice of denial will contain:

 

  (A) the specific reason or reasons for denial of the claim;

 

  (B) a reference to the relevant Plan provisions upon which the denial is
based;

 

  (C) a description of any additional material or information necessary for the
claimant to perfect the claim, together with an explanation of why the material
or information is necessary; and

 

  (D) an explanation of this Plan’s claim review procedure.

If no notice is provided, the claim will be deemed denied. The interpretations,
determinations and decisions of the Administrator will be final and binding upon
all persons with respect to any right, benefit and privilege hereunder, subject
to the review procedures set forth in this Article.

 

8.6 Request for Review of a Denial of a Claim for Benefits. Any claimant or any
authorized representative of the claimant whose claim for benefits under this
Plan has been denied or deemed denied, in whole or in part, may upon written
notice to the Appeals Committee request a review by the Appeals Committee of the
denial of the claim. The claimant will have 60 days from the date the claim is
deemed denied or 60 days from receipt of the notice denying the claim, as the
case may be, in which to request a review by written application delivered to
the Appeals Committee, which must specify the relief requested and the reason
such claimant believes the denial should be reversed.

 

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Part B - 2005 Plan

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8.7 Appeals Procedure. The Appeals Committee will review the facts and relevant
documents including this Plan, and interpret the facts and relevant documents
including this Plan to render a decision on the claim. The review may be of
written briefs submitted by the claimant, or at a hearing, or by both, as deemed
necessary or appropriate by the Appeals Committee. Any hearing will be held in
the main office of Ferro, or such other location as the Appeals Committee may
select, on the date and at the time as the Appeals Committee designates by
giving at least 15-days’ notice to the claimant, unless the claimant accepts
shorter notice. The notice will specify that the claimant must indicate in
writing, at least five days in advance of the hearing, the claimant’s intention
to appear at the appointed time and place, or the hearing will be automatically
cancelled. The reply will specify any other persons who will accompany the
claimant to the hearing, or such other persons will not be admitted to the
hearing. The Appeals Committee will make every effort to schedule the hearing on
a day and at a time that is convenient to both the claimant and the Appeals
Committee. The claimant, or his duly authorized representative, may review all
pertinent documents relating to the claim in preparation for the hearing and may
submit issues and comments in writing before or during the hearing.

 

8.8 Decision Upon Review of Denial of Claim for Benefits. In making its
decision, the Appeals Committee will have full power and discretion to interpret
this Plan, to resolve ambiguities, inconsistencies and omissions, to determine
any question of fact, and to determine the right to benefits of, and the amount
of benefits, if any, payable to, any person in accordance with the provisions of
this Plan. The Appeals Committee will render a decision on the claim reviewed no
more than 60 days after the receipt of the claimant’s request for review, unless
special circumstances (such as the need to hold a hearing) require an extension
of time, in which case the 60-day period may be extended up to 120 days. The
Appeals Committee will provide written notice of its decision to the claimant
within the time frame specified. The notice will include the specific reasons
for the decision and contain specific references to the relevant Plan provisions
upon which the decision is based. If notice of the decision is not provided
within the time frame specified, the claim will be deemed denied on review. The
decision of the Appeals Committee will be final and binding in all respects on
the Administrator, the Ferro Group Company and claimant involved.

 

8.9

Establishment of Appeals Committee. In the absence of an affirmative appointment
otherwise by the Chief Executive Officer pursuant to this Section, the Ferro
Corporation Retirement Committee shall serve as the Appeals Committee. The Chief
Executive Officer of Ferro will appoint three or more persons to serve as
members of the Appeals Committee. The Chief Executive Officer may appoint one
Appeals Committee to hear all appeals of denied benefits that arise under this
Plan, or may appoint a new Appeals Committee each time an Appeals Committee is
needed to hear an appeal of denied benefits that arises under this Plan. The
members of the Appeals Committee will remain in office at the will of the Chief
Executive Officer, and the Chief Executive Officer may remove any of the members
with or without cause. A member of the Appeals Committee may resign upon written
notice to the remaining member or members of the Appeals Committee and to the
Chief Executive Officer, respectively. The fact that a person is a Participant
or a former Participant or a prospective Participant will not disqualify that
person from acting as a member of the Appeals Committee. No member of the
Appeals Committee will be disqualified from acting on any question because of
the member’s interest in the question, except that no member of the Appeals
Committee may act on any claim which the

 

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Effective January 1, 2005

 

  member has brought as a Participant, former Participant, or Beneficiary under
this Plan. In case of the death, resignation or removal of any member of the
Appeals Committee, the remaining members will act until a successor-member is
appointed by the Chief Executive Officer. At the Administrator’s request, the
Chief Executive Officer will notify the Administrator in writing of the names of
the members of the Appeals Committee, of any and all changes in the membership
of the Appeals Committee, of the member designated as Chairman, and the member
designated as Secretary, and of any changes in either office. Until notified of
a change, the Administrator will be protected in assuming that there has been no
change in the membership of the Appeals Committee or the designation of Chairman
or of Secretary since the last notification was filed with it. The Administrator
will be under no obligation at any time to inquire into the membership of the
Appeals Committee or its officers. All communications to the Appeals Committee
will be addressed to its Secretary at the address of the Company.

 

8.10 Operation of the Appeals Committee. On all matters and questions, the
decision of a majority of the members of the Appeals Committee will govern and
control. A meeting need not be called or held to make any decision. The Appeals
Committee will appoint one of its members to act as its Chairman and another
member to act as Secretary. The terms of office of these members will be
determined by the Appeals Committee, and the Secretary and/or Chairman may be
removed by the other members of the Appeals Committee for any reason which such
other members may deem just and proper. The Secretary will do all things
directed by the Appeals Committee. Although the Appeals Committee will act by
decision of a majority of its members as provided above, in the absence of
written notice to the contrary, every person may deal with the Secretary and
consider the Secretary’s acts as having been authorized by the Appeals
Committee. Any notice served or demand made on the Secretary will be deemed to
have been served or made upon the Appeals Committee.

 

8.11 Limitation of Duties. Ferro, the other Ferro Group Companies, the
Administrator, the Appeals Committee, and their respective officers, members,
employees and agents will have no duty or responsibility under this Plan other
than the duties and responsibilities expressly assigned or delegated to them
pursuant to this Plan. None of them will have any duty or responsibility with
respect to those duties or responsibilities assigned or delegated to another.

 

8.12 Agents. The Administrator and the Appeals Committee may hire any attorneys,
accountants, actuaries, agents, clerks, and secretaries as it may deem desirable
in the performance of its duties, any of whom may also be advisors to any Ferro
Group Company or any subsidiary or affiliated company.

 

8.13 Expenses of Administration. No fee or compensation will be paid to the
Administrator or any member of the Appeals Committee for their performance of
services as such. Ferro will bear all other expenses incurred in the
administration of this Plan except to the extent Ferro determines that the
expenses are allocable to, and should be paid by, one or more of the Ferro Group
Companies.

 

8.14

Indemnification. In addition to whatever rights of indemnification any member or
employee of the Administrator, the Appeals Committee, Ferro or other Ferro Group
Company under this Plan may be entitled to under the articles of incorporation,
regulations or bylaws of the Ferro Group Companies, under any provision of law
or

 

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Part B - 2005 Plan

Effective January 1, 2005

 

  under any other agreement, the Ferro Group Companies will satisfy any
liability actually incurred by any member or employee including reasonable
expenses and attorneys’ fees, and any judgments, fines, and amounts paid in
settlement, in connection with any threatened, pending or completed action, suit
or proceeding which is related to the exercise or failure to exercise by any
member or employee any powers, authority, responsibilities or discretion
provided under this Plan or reasonably believed by a member or employee to be
provided under this Plan, and any action taken by a member or employee in
connection with such exercise or failure to exercise. This indemnification for
all such acts taken or omitted is intentionally broad, but will not provide
indemnification for embezzlement or diversion of Plan funds for the benefit of
any member or employee. This indemnification will not be provided for any claim
by a Ferro Group Company or a subsidiary or affiliated company thereof against
any member or employee. No indemnification will be provided to any person who is
not an individual.

 

8.15 Limitation of Administrative Liability. Neither Ferro, any Ferro Group
Company, the Administrator, the Appeals Committee, nor any of their members or
employees will be liable for any act taken by such person or entity pursuant to
any provision of this Plan except for gross abuse of the discretion given them
under this Plan. No member of the Administrator or Appeals Committee will be
liable for the act of any other member. No member of the Board of Directors will
be liable to any person for any action taken or omitted in connection with the
administration of this Plan.

 

8.16 Limitation of Sponsor Liability. Any right or authority exercisable by
Ferro or Board of Directors pursuant to any provision of this Plan will be
exercised in Ferro’s capacity as sponsor of this Plan, or on behalf of Ferro in
such capacity, and not in a fiduciary capacity, and may be exercised without the
approval or consent of any person in a fiduciary capacity. Neither Ferro, nor
the Board of Directors, nor any of their respective officers, members,
employees, agents and delegates, will have any liability to any party for its
exercise of any such right or authority.

ARTICLE IX

AMENDMENT AND TERMINATION

 

9.1 Amendment, Modification and Termination. Subject to Sections 9.4 and 9.5
below, this Plan may be amended, modified or terminated by Ferro at any time, or
from time to time, by action of an appropriate Ferro officer authorized or
ratified by the Board of Directors. No amendment, modification or termination
will be effective if it reduces the amounts credited to any Participant’s
Account or adversely affects the right of any Participant or Beneficiary to
receive payment of the Account as provided under this Plan, determined as of the
date of the amendment, unless an equivalent benefit is provided under another
plan or program sponsored by the Company or an Affiliate. Furthermore, no
amendment, modification or termination will be effective prior to the date
permitted under Code Section 409A, which, in certain circumstances is 12 months
following the adoption of such amendment, modification or termination.

The prior provisions notwithstanding, this Plan may be amended to:

 

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Part B - 2005 Plan

Effective January 1, 2005

 

 

  (A) reduce or eliminate the ability for contributions to be credited to
Participants under this Plan;

 

  (B) reduce or eliminate the future deemed interest or earnings credited to the
amounts held in a Participant’s Account;

 

  (C) comply with any law; or

 

  (D) preserve the intended deferral of taxation for the benefit of all
Participants Accounts.

 

9.2 Effect of Amendment on Distributions. If this Plan is amended to terminate
the Plan or to prohibit future contributions under the Plan, the Accounts of
Participants who have not incurred a Termination of Employment will become will
be 100% vested as of the date of the termination of the Plan or prohibition of
future contributions under the Plan.

 

9.3 Actions Binding on Ferro Group Companies. Any amendments made to this Plan
will be binding on all the Ferro Group Companies without the approval or consent
of the Ferro Group Companies other than Ferro. Ferro may, by amendment, also
terminate this Plan on behalf of all or any one of the other Ferro Group
Companies in its sole discretion.

 

9.4 Termination or Amendment After Change in Control. If a Change in Control
occurs, then, for a period of two (2) calendar years following such Change in
Control, Ferro may not amend or terminate this Plan without the prior written
consent of all Participants.

 

9.5 Distribution of Benefits on Plan Termination. In the event Ferro elects to
amend, modify or terminate the Plan as provided under Section 9.1, no
liquidation and payment of benefits shall occur as a result. The prior
provisions notwithstanding, Ferro may, in its discretion, provide by amendment
to the Plan for the liquidation and termination of the Plan where:

 

  (A) the termination and liquidation does not occur proximate to a downturn in
the financial health of Ferro and Affiliates;

 

  (B) the Plan and all arrangements required to be aggregated with the Plan
under Code Section 409A are terminated and liquidated;

 

  (C) no payments, other than those that would be payable under the terms of the
Plan and the aggregated arrangements if the termination and liquidation had not
occurred, are made within twelve (12) months of the date Ferro takes all
necessary action to irrevocably terminate and liquidate the Plan;

 

  (D) all payments are made within twenty-four (24) months of the date Ferro
takes all necessary action to irrevocably terminate and liquidate the Plan; and

 

  (D) Ferro and Affiliates does not adopt a new arrangement that would be
aggregated with any terminated arrangement under Code Section 409A, at any time
within three (3) years following the date of the date Ferro takes all necessary
action to irrevocably terminate and liquidate the Plan.

 

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Part B - 2005 Plan

Effective January 1, 2005

 

Similarly, Ferro may, in its discretion, provide by amendment to liquidate and
terminate the Plan where the termination and liquidation occurs within twelve
(12) months of a corporate dissolution taxed under Code Section 331, or with the
approval of a bankruptcy court pursuant to 11 United States Code
Section 503(b)(1)(A), provided that all amounts deferred under the Plan are
included in the Participants’ gross incomes in the latest of the following years
(or, if earlier, the taxable year in which the amount is actually or
constructively received):

 

  (A) the calendar year in which the termination and liquidation occurs;

 

  (B) the first calendar year in which the amount is no longer subject to a
substantial risk of forfeiture; or

 

  (C) the first calendar year in which the payment is administratively
practicable.

ARTICLE X

FERRO GROUP COMPANIES

 

10.1 List of Ferro Group Companies. The Ferro Group Companies as of the
Amendment and Restatement Date are Ferro and the Affiliates of Ferro listed on
Appendix B to this Plan. Ferro may from time to time add or remove Ferro
Affiliates from the list of Ferro Group Companies by written action of its Chief
Executive Officer. The addition or deletion will not require a formal amendment
to this Plan.

 

10.2 Delegation of Authority. Ferro is fully empowered to act on behalf of
itself and the other Ferro Group Companies as it may deem appropriate in
maintaining this Plan and any Trust. The adoption by Ferro of any amendment to
this Plan or any Trust, or the termination of this Plan or any Trust, will
constitute and represent, without any further action on the part of any Ferro
Group Company, the approval, adoption, ratification or confirmation by each
Ferro Group Company of any amendment or termination. In addition, the
appointment of or removal by Ferro of any Administrator, any trustee or other
person under this Plan or any Trust will constitute and represent, without any
further action on the part of any Ferro Group Company, the appointment or
removal by each Ferro Group Company of such person.

 

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Part B - 2005 Plan

Effective January 1, 2005

 

ARTICLE XI

MISCELLANEOUS

 

11.1 No Implied Rights. Neither the establishment of this Plan nor any amendment
of this Plan will be construed as giving any Participant, Beneficiary or any
other person any legal or equitable right unless the right is specifically
provided for in this Plan or conferred by specific action of Ferro in accordance
with the terms and provisions of this Plan. Except as expressly provided in this
Plan, neither Ferro nor any other Ferro Group Company will be required or be
liable to make any payment under this Plan.

 

11.2 No Right to Ferro Group Company Assets. Neither the Participant nor any
other person will acquire by reason of this Plan any right in or title to any
assets, funds or property of Ferro or any other Ferro Group Company whatsoever
including, without limitation, any specific funds, assets or other property
which Ferro or any other Ferro Group Company, in its sole discretion, may set
aside in anticipation of a liability hereunder. Any benefits which become
payable under this Plan will be paid from the general assets of the appropriate
Ferro Group Company. No assets of Ferro or any other Ferro Group Company will be
held in any way as collateral security for the fulfilling of the obligations of
Ferro or the Ferro Group Companies under this Plan. No assets of Ferro or any
other Ferro Group Company will be pledged or otherwise restricted in order to
meet the obligations of this Plan. The Participant will have only a contractual
right to the amounts, if any, payable hereunder unsecured by any asset of Ferro
or any other Ferro Group Company. Nothing contained in this Plan constitutes a
guarantee by Ferro or any other Ferro Group Company that the assets of Ferro or
any other Ferro Group Company will be sufficient to pay any benefit to any
person.

 

11.3 No Employment Rights Created. This Plan will not be deemed to constitute a
contract of employment between Ferro or any of the other Ferro Group Companies
and any Participant, or to confer upon any Participant or employee the right to
be retained in the service of Ferro or any other Ferro Group Company for any
period of time, nor shall any provision of this Plan restrict the right of Ferro
or any other Ferro Group Company to discharge or otherwise deal with any
Participant or other employees, with or without cause. Nothing in this Plan will
be construed as fixing or regulating the compensation or other benefits payable
to any Participant or other employee of Ferro or any other Ferro Group Company.

 

11.4 Offset. If at the time payment is to be made under this Plan the
Participant or the Beneficiary or both are indebted or obligated to a Ferro
Group Company, then the payment to be made to the Participant or the Beneficiary
or both may, at the discretion of the Administrator at the request of the Ferro
Group Company, be reduced by the amount of the indebtedness or obligation, but
only if:

 

  (A) such debt is incurred in the ordinary course of the service relationship
between the Participant and the Ferro Group Company,

 

  (B) in any taxable year of Ferro and Affiliates the entire amount of reduction
does not exceed $5,000, and

 

  (C) the reduction is made at the same time and in the same amount as the debt
otherwise would have been due and collected from the Participant.

 

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Part B - 2005 Plan

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An election by the Ferro Group Company not to request any reduction will not
constitute a waiver of the Ferro Group Company’s claim for such indebtedness or
obligation.

 

11.5 No Assignment. Neither the Participant nor any other person will have any
voluntary or involuntary right to commute, sell, assign, pledge, anticipate,
mortgage or otherwise encumber, transfer, hypothecate or convey, in advance of
actual receipt of the amount, if any, payable under this Plan, or any part of
the amount payable from this Plan, and any attempt to do so will be void. All
benefits or amounts credited to Accounts under this Plan are expressly declared
to be unassignable and non-transferable. No part of the benefits or amounts
credited to Accounts under this Plan will be, before actual payment, subject to
seizure or sequestration for the payment of any debts, judgments, alimony or
separate maintenance owed by the Participant or any other person, or be
transferable by operation of law in the event of the Participant’s or any other
person’s bankruptcy or insolvency.

 

11.6 Notice. Any notice required or permitted to be given under this Plan will
be sufficient if in writing and hand delivered, or sent by registered or
certified mail or by overnight delivery service, and:

 

  (A) if given to a Ferro Group Company, delivered to the principal office of
Ferro, directed to the attention of the General Counsel; or

 

  (B) if given to a Participant or Beneficiary, delivered to the last post
office address as shown on the Ferro Group Company’s or the Administrator’s
records.

Notice will be deemed given as of the date of delivery or, if delivery is made
by mail, as of the date shown on the postmark or the receipt for registration or
certification.

 

11.7 Governing Laws. This Plan will be construed and administered according to
the internal substantive laws of the State of Ohio to the extent not preempted
by the laws of the United States of America.

 

11.8 Incapacity. If the Administrator determines that any Participant or
Beneficiary entitled to payment under this Plan is a minor, a person declared
incompetent or a person incapable of handling his or her property, the
Administrator may direct any payment to the guardian, legal representative or
person having the care and custody of the minor, incompetent or incapable
person. The Administrator may require proof of minority, incompetence,
incapacity or guardianship, as it may deem appropriate before making any
payment. The Administrator will have no obligation thereafter to monitor or
follow the application of amounts so paid. Payments made pursuant to this
Section will completely discharge this Plan, any Trust, the Administrator, Ferro
and all other Ferro Group Companies with respect to the payments.

 

11.9 Court Ordered Distributions. If a court issues a domestic relations order
as defined in Code Section 414(p)(1)(B) by which a spouse or former spouse or
dependent or former dependent of a Participant is provided an interest in the
Participant’s Account under this Plan in connection with a property settlement
or otherwise, the Administrator shall, notwithstanding any election made by the
Participant or the Participant’s eligibility for distribution, distribute the
spouse’s or former spouse’s or dependent’s or former dependent’s interest in the
Participant’s Account under this Plan to that spouse or former spouse or
dependent or former dependent, as provided under such domestic relations order.

 

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11.10 Administrative Forms. All applications, elections and designations in
connection with this Plan made by a Participant or Beneficiary will become
effective only when duly executed on forms provided by the Administrator and
filed with the Administrator.

 

11.11 Independence of Plan. Except as otherwise expressly provided, this Plan
will be independent of, and in addition to, any other employee benefit agreement
or plan or any rights that may exist from time to time under any other agreement
or plan.

 

11.12 Responsibility for Legal Effect. Neither Ferro, any other Ferro Group
Company, the Administrator, nor any officer, member, delegate or agent of any of
them, makes any representations or warranties, express or implied, or assumes
any responsibility concerning the legal, tax, or other implications or effects
of this Plan.

 

11.13 Successors. The terms and conditions of this Plan will inure to the
benefit of and bind Ferro, the Ferro Group Companies, the Administrator and its
members, the Participants, their Beneficiaries, and the successors, assigns, and
personal representatives of any of them.

 

11.14 Headings and Titles. The Section headings and titles of Articles used in
this Plan are for convenience of reference only and are not to be considered in
construing this Plan.

 

11.15 Appendices. The Appendices to this Plan constitute an integral part of
this Plan and are hereby incorporated into this Plan by this reference.

 

11.16 Severability. If any provision or term of this Plan, or any agreement or
instrument required by the Administrator, is determined by a judicial,
quasi-judicial or administrative body to be void or not enforceable for any
reason, all other provisions or terms of this Plan or the agreement or
instrument will remain in full force and effect and will be enforceable as if
the void or nonenforceable provision or term had never been a part of this Plan,
or the agreement or instrument.

 

11.17 Actions by Ferro. Except as otherwise provided in this Plan, all actions
of Ferro under this Plan will be taken by the Board of Directors, and be
evidenced in a writing executed by an appropriate officer duly authorized.

 

11.18 Spousal Consent and Release. If, in the opinion of Ferro, any present,
former or future spouse of an employee entitled to benefits from this Plan shall
by reason of law appear to have any interest in the Plan benefits that may be or
become payable hereunder to such employee, Ferro may as a condition precedent to
the making of a benefit payment hereunder, require such written consent or
release as in its discretion it shall determine to be necessary, desirable or
appropriate either to prevent or avoid any conflict or multiplicity of claims,
or to protect the rights of any such present, former or future spouse with
respect to the payment of any benefits under this Plan.

 

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11.19 Overpayments and Repayments. Benefits are provided only as set forth under
the terms of this Plan. Payments at a time or in an amount other than as set
forth under the terms of the Plan are not authorized, and Ferro will take all
reasonable steps to ensure that the amount and timing of benefit payments are in
accordance with the Plan’s terms. In the event Ferro determines that the
benefits actually paid under this Plan to a Participant, beneficiary or other
person exceed the benefits that were properly payable, or were paid prior to the
proper time for payment, Ferro shall immediately demand repayment of such excess
amounts. The Participant, Beneficiary or other person is obligated to return
such excess amounts upon demand from Ferro. In the event the Participant,
beneficiary or other person fails to return the excess amounts, Ferro shall
exercise any available legal remedies which are consistent with the terms and
purpose of the Plan.

 

11.20 References to Sections of Law. References herein to the Code are to the
Internal Revenue Code of 1986, as heretofore and hereafter amended, and to
similar provision of subsequent federal law. References herein to ERISA are to
the Employee Retirement Income Security Act of 1974, as heretofore and hereafter
amended, and to similar provisions of subsequent law.

 

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Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

DEFINITIONS

For purposes of this Plan, the following terms have the meanings set forth below
where used in this Plan and identified with initial capital letters:

 

Term    Meaning

Account

   For each Participant the bookkeeping account maintained by Ferro to reflect
the Participant’s Supplemental Matching Contributions, Supplemental Basic
Pension Contributions, and the deemed investment return on those amounts. A
Participant’s Account will not constitute nor be treated as a trust fund of any
kind.

Administrator

   As defined in Section 8.1 of this Plan.

Affiliate

   Any corporation or business entity during any period during which it would be
treated, together with the Company, as a single employer for purposes of Code
Section 414(b) or (c).

Amendment and

Restatement Date

   January 1, 2005.

Beneficial Owner

   “Beneficial owner” within the meaning of Rule 13d-3 under the Exchange Act.

Beneficiary

   As defined in Section 5.6 of this Plan.

Board of Directors

   Ferro’s Board of Directors.

Change in Control

   A change in the control of Ferro that is required to be reported in response
to Item 6(e) of Schedule 14A of Regulation 14A promulgated under the Exchange
Act. For purposes of this definition, a Change in Control will be deemed to have
occurred if and when:   

(a)    any “person” (as such term is used in Sections 13(d)(3) and 14(d)(2) of
the Exchange Act) is or becomes the beneficial owner, directly or indirectly, of
securities of Ferro representing twenty-five percent (25%) or more of the
combined voting power of Ferro’s outstanding voting securities; or

  

(b)    during any period of two consecutive years, the individuals set forth
below in sub-paragraph (1) and (2) cease for any reason to constitute at least a
majority of the Board of Directors:

 

B-24

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Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning   

(1)    the individuals who at the beginning of such period constituted the Board
of Directors, and

  

(2)    any new director (other than a director designated by a person who has
entered into an agreement or arrangement with Ferro to effect a transaction
described in clause (a) or (c) of this definition) whose appointment, election,
or nomination for election by Ferro’s shareholders, was approved by a vote of at
least two-thirds of the directors then still in office who either were directors
at the beginning of the period or whose appointment, election or nomination for
election was previously so approved; or

  

(c)    a merger or consolidation of Ferro or one of its subsidiaries is
consummated with or into any other corporation, other than a merger or
consolidation which would result in the holders of the voting securities of
Ferro outstanding immediately prior thereto holding securities which represent
immediately after such merger or consolidation more than 50% of the combined
voting power of the voting securities of either Ferro or the other entity which
survives such merger or consolidation or the parent of the entity which survives
such merger or consolidation; or

  

(d)    a sale or disposition by Ferro of all or substantially all Ferro’s assets
is consummated.

Code    The Internal Revenue Code of 1986, as amended, and any lawful
regulations or other pronouncements promulgated under that Code. Compensation   
“Compensation” as defined under the Ferro SSOP, but increased to include amounts
deferred under the Ferro Corporation Deferred Compensation Plan for Executive
Employees and decreased to exclude the awards paid under Ferro’s Performance
Share Plan (except that the cash portion of awards paid prior to January 1, 2007
are included for purposes of determining Supplemental Matching Contributions),
and without regard to any provisions of the Code which limit the amount of such
compensation that can be taken into account for purposes of determining
contributions or benefits.

 

B-25

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Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning    Specifically, as of the Amendment and Restatement Date,
Compensation under this Plan means compensation (as defined in Section 415(c)(3)
of the Code) paid by a Ferro Group Company to or on behalf of a Participant
while a Participant in the Ferro SSOP during a Plan Year, including all wages
and salary, commissions, bonuses, accrued vacation pay, 401(k) Contributions
contributed under the Ferro SSOP, elective employer contributions made on behalf
of the Participant that are not includible in gross income under Section 125,
129, 132(f), 402(e)(3), 402(h)(1)(B), 403 and 457 of the Code, and deferred
amounts under the Ferro Corporation Deferred Compensation Plan for Executive
Employees, but excluding relocation expense reimbursements (including mortgage
interest differentials) or other expense allowances or fringe benefits which are
paid with respect to a period following termination of employment, automobile
allowance income, foreign service premiums, awards paid under Ferro’s
Performance Share Plan, and any other extraordinary income, allowance, and
welfare benefits. The prior sentence notwithstanding, the cash portion of awards
paid prior to January 1, 2007 under Ferro’s Performance Share Plan will be
included in Compensation for purposes of determining a Participant’s
Supplemental Matching Contribution. The foregoing definition was effective
June 30, 2004. Disability    Any disability that qualifies a Participant for
payment of benefits under a Ferro Group Company long-term disability program,
provided that the definition of disability provided under such long-term
disability program meets one of the following requirements:   

(a)    The Participant is unable to engage in any substantial gainful activity
by reason of any medically determinable physical or mental impairment that can
be expected to result in death or can be expected to last for a continuous
period of not less than 12 months; or

 

B-26

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning   

(b)    The Participant is, by reason of any medically determinable physical or
mental impairment that can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, receiving income
replacement benefits for a period of not less than three months under an
accident and health plan covering employees of a Ferro Company Group.

   The determination of whether a Participant suffers a Total and Permanent
Disability will be made by the Administrator.

ERISA

   The Employee Retirement Income Security Act of 1974, as amended, and any
lawful regulations or pronouncements issued under that Act.

Exchange Act

   The Securities Exchange Act of 1934, as amended, and any lawful regulations
or pronouncements issued under that Act.

Ferro

   As defined in Section 1.2 of this Plan. Such term also includes any successor
corporation or business organization that subsequently assumes Ferro’s duties
and obligations under this Plan.

Ferro Common Stock

   The Common Stock of Ferro, par value $1.00 per share.

Ferro Group Companies

   As defined in Section 10.1 of this Plan.

Ferro SSOP

   Ferro’s Savings and Stock Ownership Plan, as the same may be amended from
time to time.

401(k) Contributions

   Pre-tax contributions made to the Ferro SSOP pursuant to Code Section 401(k).

409A Benefits

   All benefits under the Plan which are not Pre-2005 Benefits (generally,
amounts which are earned or vested under the Plan after December 31, 2004, plus
any earnings with respect to such amounts or to such earnings).

2005 Plan

   The provisions of the Plan as set forth in Part B, which govern 409A
Benefits.

Pre-2005 Benefits

   All benefits under the Plan that were earned and vested under the Plan as of
December 31, 2004, plus any earnings with respect to such amounts or to such
earnings.

 

B-27

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Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning

Pre-2005 Plan

   The provisions of the Plan set forth in Part A, which govern Pre-2005
Benefits.

Highly Compensated Employee

   An employee of a Ferro Group Company who is in Salary Grade 22 or higher and
for whom contributions under the Ferro SSOP are limited due to the provisions of
Section 401(a)(17), 401(k), 401(m), 402(g) or 415 of the Code.

Participant

   A Highly Compensated Employee of a Ferro Group Company who becomes a
Participant pursuant to Section 3.2 of this Plan. A Participant will cease to be
a Participant, and shall become a former Participant, upon the earliest of the
following:   

(a)    Termination of Employment,

  

(b)    the date the employee ceases to be a Highly Compensated Employee, or

  

(c)    the date the employee’s participation in this Plan is terminated by the
Administrator pursuant to Section 5.7 of this Plan or otherwise.

Person

   A “person” as defined under Section 3(a)(9) of the Exchange Act as modified
and used in Sections 13(d) and 14(d) of the Exchange Act, excluding:   

(a)    Ferro or any of its subsidiaries;

  

(b)    a trustee or other fiduciary holding securities under an employee benefit
plan of the Company (or of any of its affiliates as defined under Rule 12b-2
under Section 12 of the Exchange Act);

  

(c)    an underwriter temporarily holding securities pursuant to an offering of
such securities; or

  

(d)    a corporation owned, directly or indirectly, by the shareholders of Ferro
in substantially the same proportion as their ownership of the stock of Ferro.

Plan

   The Ferro Corporation Supplemental Defined Contribution Plan for Executives,
or a component plan, as appropriate.

Plan Year

   The calendar year.

 

B-28

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning

Termination of Employment

   Effective Prior to January 1, 2008: A Participant’s cessation of service with
Ferro and the other Ferro Group Companies, including subsidiaries and affiliates
of the foregoing, for any reason whatsoever, whether voluntarily or
involuntarily, including by reason of retirement, death, or becoming Totally and
Permanently Disabled. Notwithstanding the foregoing, for purposes of triggering
payment under Section 5.1, only such cessation of service which constitutes a
“separation from service” under Code Section 409A shall constitute a Termination
of Employment.    Effective January 1, 2008: With respect to any Participant:   

(a)     the separation from service within the meaning of Section 409A of the
Code, of such Participant with the Company and all of its Affiliates, for any
reason, including without limitation, quit, discharge, or retirement, or a leave
of absence (including military leave, sick leave, or other bona fide leave of
absence such as temporary employment by the government if the period of such
leave exceeds the greater of six months, or the period for which the
Participant’s right to reemployment is provided either by statute or by
contract), or

  

(b)     a permanent decrease in the level of the Participant‘s service to a
level that is no more than twenty percent (20%) of its prior level. For this
purpose, whether a Termination of Employment has occurred is determined based on
whether it is reasonably anticipated that no further services will be performed
by the Participant after a certain date or that the level of bona fide services
the Participant will perform after such date (whether as an employee or as an
independent contractor) would permanently decrease to no more than twenty
percent (20%) of the average level of bona fide services performed (whether as
an employee or an independent contractor) over the immediately preceding
36-month period (or the full period of services if the Participant has been
providing services less than 36 months).

 

B-29

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Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning

Time Required by Law

   The date designated for payment under the terms of the Plan or a later date
in the same calendar year or, if later, the fifteenth (15th) day of the third
calendar month following the date designated for payment. (However, if the
Participant’s taxable year is not the calendar year, the date designated for
payment under the terms of the Plan or a later date in the Participant’s taxable
year or, if later, the fifteenth (15th) day of the third calendar month
following the date designated for payment.)    If calculation of the amount of
the benefit is not administratively practicable due to events beyond the control
of the Participant (or the Participant’s Beneficiary), any date within the first
taxable year of the Participant in which calculation of the payment is
administratively practicable.    If making the payment on the date designated
under the terms of the Plan would jeopardize the ability of Ferro and Affiliates
to continue as a going concern, the first taxable year of the Participant in
which making the payment would not have such effect.    If there is a delay in
payment by the Administrator other than with the express or implied consent of
the Participant, the first taxable year of the Participant in which the dispute
is resolved. The dispute shall be deemed resolved on the earliest date upon
which: (a) the Participant and the Administrator or Ferro enter into a legally
binding settlement, (b) the Administrator or Ferro concedes that an amount is
payable, or (c) the Administrator or Ferro is required to make payment pursuant
to a final non-appealable judgment or other binding decision. The foregoing
provisions shall apply only if, during the period of the dispute, the
Participant accepts any portion of the payment the Administrator or Ferro
willing to make (unless acceptance will result in relinquishment of the claim to
any remaining portion), and makes prompt and reasonable good faith efforts to
collect the remaining portion of the payment which meet the requirements of Code
Section 409A (including the timely notice requirements).

 

B-30

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

Appeendix A

 

Term    Meaning   

In the event the payment fails to fails to comply with Federal securities laws
or other laws, the earliest date at which Ferro reasonably anticipates that the
making of the payment will not cause such violation.

 

In the event the payment fails to be deductible under Code Section 162(m), or
meets other conditions specified by the Commissioner of the Internal Revenue
Service, such later date as may be provided under Code Section 409A.

Trust

   The trust, if any, established pursuant to Section 7.1 of this Plan.

Valuation Date

   The last day of each quarter in the Plan Year and any other date or dates
Ferro, in its sole discretion, designates from time to time.    For purposes of
determining the value of a Participant’s Account for distribution, the Valuation
Date is the last day of the month in which occurs the Participant’s Termination
of Employment, death, or commencement of long-term disability benefits on
account of a determination of Disability under a Ferro Group Company long-term
disability plan.

Years of Vesting Service

   The years of vesting service with which a Participant is credited under the
Ferro SSOP.

 

B-31

--------------------------------------------------------------------------------

Part B - 2005 Plan

Effective January 1, 2005

Appeendix B

 

FERRO GROUP COMPANIES

The following are the Ferro Group Companies:

Ferro Corporation

FEM Inc.

Ferro Color & Glass Corp. (formerly, Ferro Glass & Color Corporation)

Ferro International Services, Inc.

Ferro Pfanstiehl Laboratories, Inc.

 

B-32

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EXECUTION PAGE

To evidence this amended and restated FERRO CORPORATION SUPPLEMENTAL DEFINED
CONTRIBUTION PLAN FOR EXECUTIVE EMPLOYEES, Ferro Corporation, as Plan sponsor,
has caused this document to be executed by its duly authorized officer as of
this 20th day of September, 2007.

 

FERRO CORPORATION By:          

James C. Bays

Vice President, General Counsel

& Secretarys

 

C-1