Exhibit 10.33

 

 

OWENS-ILLINOIS

 

2004 EXECUTIVE LIFE INSURANCE PLAN

 

FOR NON-U.S. EMPLOYEES

 

 

Effective December 1, 2004

 

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OWENS-ILLINOIS

2004 EXECUTIVE LIFE INSURANCE PLAN

FOR NON-U.S. EMPLOYEES

 

Owens-Illinois, Inc., a corporation duly organized and existing under the laws
of the state of Delaware and having its corporate headquarters in the state of
Ohio (hereinafter, together with its successors and assigns, called the
“Company”), hereby establishes and will be the sponsor of this Owens-Illinois
2004 Executive Life Insurance Plan for Non-U.S. Employees (the “Plan”),
effective as of December 1, 2004. The Plan is established and will be maintained
by the Company on behalf of each corporation (or other business entity) 50
percent or more of the voting stock (or other ownership interest) of which the
Company owns, directly or indirectly, and which employs or employed any non–U.S.
person who participates in the Plan. Each such corporation (or other business
entity), together with its successors and assigns, is hereinafter referred to as
an “Employer”.

 

W I T N E S S E T H:

 

WHEREAS, the Company entered into a Death Benefit Only Agreement effective
April 1, 2000 (the “2000 DBO Agreement”) with certain of its non-U.S. employees
whereunder the Company assumed an unsecured obligation to provide the
beneficiaries of such non-U.S. employees with a death benefit in an amount set
forth in such DBO Agreement and whereunder in order to fund the Company’s
obligation certain policies of insurance were purchased on the life of each
participating non-U.S. employee; and

 

WHEREAS, the Company wishes to establish this Plan to provide for the continued
funding and consistent administration of the aforementioned death benefit
obligation under non-equity endorsement split-dollar arrangements with respect
to non–U.S. employees and non-U.S. retirees covered by a DBO Agreement and other
non-U.S. employees who satisfy the eligibility requirements of this Plan.

 

NOW, WHEREFORE, it is hereby agreed as follows:

 

ARTICLE I - PURPOSE

 

1.1                                 The primary purpose of this Plan is to
support the Employers in attracting and retaining qualified executive non-U.S.
personnel, by providing for pre-retirement and post-retirement death benefits in
an amount set forth in an existing DBO Agreement or as otherwise determined by
the Company, as hereinafter provided and subject to certain limits hereinafter
stated. The Company has determined that the foregoing can best be provided under
non-equity endorsement split-dollar life insurance arrangements, and an
insurance policy has been or will be applied for on the life of each of the
Participants. By execution of this Plan, the Company agrees to purchase such
insurance policies under non-equity endorsement split-dollar arrangements and to
pay the premiums thereon subject to the provisions of the Plan.

 

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Article II - Definitions

 

2.1                                 Administrator.  The Plan administrator
serving pursuant to Article XV of this Plan. The Company shall be the
Administrator unless and until the Company appoints an officer or a committee
consisting of two or more officers or employees of the Company to serve as the
Administrator.

 

2.2                                 Agreement.  A Participation Agreement, in
the form attached hereto as either Exhibit A or Exhibit A-1, entered into
between a Participant (or his or her Assignee) and the Company pursuant to which
the Participant (or his or her Assignee) agrees to participate in the Plan and
the Company agrees to purchase a Policy on such Participant’s life and
irrevocably endorse to the Participant (or his or her Assignee) its right to
designate a beneficiary with respect to the Death Benefit payable with respect
to such Policy.

 

2.3                                 Anniversary Date.  The first day of each
Plan Year.

 

2.4                                 Assignee.  The person, or entity, including
the trustee of any irrevocable trust, to whom a Participant has irrevocably
assigned his or her interest in the Company’s Obligation and the Death Benefit
payable under a Policy issued under the Plan as permitted under Article XI
hereunder.

 

2.5                                 Beneficiary.  The beneficiary or
beneficiaries of the Company’s Obligation and the Death Benefit payable under
each Policy that has been endorsed to such Participant (or his or her Assignee)
under the terms the Agreement and this Plan, as designated in accordance with
paragraph 8.1 and such Policy.

 

2.6                                 Company’s Obligation.  Under the Plan the
Company assumes an unsecured obligation to pay a Participant’s (or his or her
Assignee’s) Beneficiary prior to such Participant’s Retirement a death benefit
equal to an amount determined by the Company with respect to such Participant
and as set forth in the Agreement with such Participant, which amount shall not
be less than the death benefit set forth in the Participant’s DBO Agreement if
such DBO Agreement is in effect on the Effective Date.  The Company’s Obligation
shall be extinguished or reduced with respect to a Participant (or his or her
Assignee) upon the payment of the Death Benefit to the Participant’s (or his or
her Assignee’s) Beneficiary in accordance with paragraph 8.3, upon the transfer
of the Policy insuring the Participant’s life in accordance with paragraph 10.1,
or if the Participant’s Termination Date occurs for any reason other than such
Participant’s Retirement, Disability or death in accordance with paragraph 9.2. 
To the extent that the Company’s Obligation is not fully extinguished as
provided in the preceding sentence, the Company shall be liable for any such
deficiency in accordance with paragraph 8.3.

 

2.7                                 Death Benefit.  The portion of the face
amount of the Policy payable upon a Participant’s death to the Participant’s (or
his or her Assignee’s) Beneficiary as specified herein.  In the case of a
Participant who is a Non-U.S. Retiree on the

 

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Effective Date, the Death Benefit shall equal the amount of the death benefit
set forth in the Participant’s DBO Agreement.  In the case of each other
Participant, the Death Benefit shall be the amount set forth in the Agreement
with the Participant as determined by the Company.

 

2.8                                 Disability.  A Participant’s inability,
solely because of disease or injury for which the Participant is under the care
of a qualified physician, to work within his or her own occupation, as
determined for purposes of the Owens-Illinois Long-Term Disability Plan, a
component of the Owens-Illinois, Inc. Salary Employees Welfare Benefit Plan or
such other long-term disability plan established by the Participant’s Employer
in which the Participant is eligible to participate.

 

2.9                                 Distribution Date.  The Distribution Date of
a Non-U.S. Retiree on the Effective Date shall be June 2, 2005 and the
Distribution Date of any other Participant shall be the first business day
following the six-month anniversary of such Participant’s Termination Date.

 

2.10                           Effective Date.  December 1, 2004.

 

2.11                           Endorsement.  The irrevocable contractual
endorsement by the Company as Owner of the Policy to a Participant (or his or
her Assignee) of the Death Benefit payable with respect to such Policy as set
forth in the Agreement between the Company and the Participant (or his or her
Assignee).

 

2.12                           Insurance Company.  Jefferson-Pilot Life
Insurance Company, or any other insurance company or companies authorized to do
business in the state of Ohio selected by the Company for the issuance of a
Policy pursuant to the Plan.

 

2.13                           Non-U.S. Employee.  Any non-U.S. citizen
performing services for an Employer for which Form W-2 compensation (or
compensation which would normally be reported on Form W-2 if paid by a U.S.
Employer) is paid.  For purposes of this Plan, an employee’s citizenship and
status as a Non-U.S. Employee shall be determined on the date of such employee’s
initial employment with an Employer.

 

2.14                           Non-U.S. Retiree.  Any former Non-U.S. Employee
who became a Participant before his or her Termination Date and whose Agreement
remains in effect after his or her Termination Date, and any former Non-U.S.
Employee on the Effective Date whose DBO Agreement with the Company continues in
effect on the Effective Date.

 

2.15                           Owner.  The Company, who is or will be defined in
a Policy as Owner and, as such, possesses or will possess all incidents of
ownership in such Policy.

 

2.16                           Participant.  Any Non-U.S. Employee and any
Non-U.S. Retiree who is eligible to participate in the Plan and who (or whose
Assignee) enrolls in the Plan in accordance with Article III.

 

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2.17                           Plan.  This Owens-Illinois 2004 Executive Life
Insurance Plan for Non-U.S. Employees.

 

2.18                           Plan Documents.  This document and all documents
incorporated into the Plan under this document, including the Agreements, the
Policies, and any other documents specifically referenced herein or therein.

 

2.19                           Plan Year.  Each 12 consecutive month period
beginning on December 1 and ending on the following November 30.

 

2.20                           Policy.  The life insurance policy on the life of
a Participant, together with any supplemental contracts issued by the Insurance
Company in conjunction therewith, purchased by the Company pursuant to the terms
of the Plan and the Agreement to which the Company is a party.

 

2.21                           Premium Payment Period.  The period of time
during which an Employer or the Company will pay all premiums with respect to
the Policy. If the Agreement applicable to a Policy terminates during the
Premium Payment Period for such Policy, such Premium Payment Period shall end
concurrently.

 

2.22                           Retirement.  Retirement from employment with an
Employer at a time and under circumstances whereby a Participant would be
eligible for an immediately payable early or normal retirement benefit under the
Owens-Illinois Salary Retirement Plan or such other retirement plan established
by the Participant’s Employer in which the Participant is eligible to
participate, as from time to time in effect.

 

2.23                           Termination Date.  The date of termination of a
Participant’s employment with the Employer(s) for any reason, including
voluntary and involuntary termination, and termination of employment due to
Disability or Retirement.

 

Article III - Eligibility

 

3.1                                 Each Non-U.S. Retiree (or his or her
Assignee) on the Effective Date, each Non-U.S. Employee (or his or her Assignee)
who has a DBO Agreement in effect on the Effective Date, and each other Non-U.S.
Employee (or his or her Assignee) whose position with an Employer is at or above
the level of divisional vice president (or equivalent, as determined by the
Company) and who is designated as eligible by the Chief Executive Officer of the
Company, shall be eligible to participate in the Plan.

 

3.2                                 Each Non-U.S. Employee (or his or her
Assignee) and Non-U.S. Retiree (or his or her Assignee) who is eligible to
participate in the Plan on the Effective Date, and who (or whose Assignee)
enrolls in the Plan by executing an Agreement, shall become a Participant on or
as of the Effective Date. Each Non-U.S. Employee (or his or her Assignee) who
becomes eligible to participate in the Plan after the Effective Date, and who
(or whose Assignee) thereafter enrolls in the Plan by executing an Agreement,
shall become a Participant in the Plan on the first Anniversary Date thereafter.

 

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3.3                                 An Agreement shall go into effect on or as
of the effective date specified in the Agreement and shall remain in effect
until the Participant’s death, unless terminated earlier as provided in
paragraph 9.2, paragraph 10.1 or Article XII; provided, however, that to the
extent the Company’s Obligation has not been fully extinguished as provided in
paragraph 9.2 or paragraph 10.1, it shall remain in effect notwithstanding the
termination of the Agreement upon the termination of the Plan, the Company’s
discontinuance of the payment of premiums under the Plan, or the cancellation,
lapse, or surrender of the Policy for any reason as provided in Article XII, for
so long as the Participant is or becomes a Non-U.S. Retiree or remains a
Non-U.S. Employee of any Employer.

 

Article IV - Application for Insurance

 

4.1                                 On or before the Effective Date or
Anniversary Date on which an eligible Non-U.S. Employee or Non-U.S. Retiree
becomes a Participant, the Company shall apply to the Insurance Company for the
issuance of a Policy insuring the Participant’s life in such amount as is
determined by the Company, which amount shall include the amount of the Death
Benefit endorsed to the Participant (or his or her Assignee) under the terms of
the Agreement and Article VI hereof.  The Participant (and his or her Assignee)
shall be subject to the provisions of the Plan, including the Agreement.
However, and notwithstanding anything herein to the contrary, neither a Non-U.S.
Employee’s or Non-U.S. Retiree’s eligibility to participate in the Plan, nor the
Company’s Obligation in paragraph 2.6 with respect to any Participant (or his or
her Assignee), are conditioned on the issuance of a Policy on the life of such
Participant, but the rights and interests of the Company, the Employers and the
Participant in and to any feature of a Policy are expressly conditioned upon the
issuance of such Policy on such underwriting classification and premium amounts
as are acceptable to the Company in the exercise of its sole and absolute
discretion.

 

4.2                                 It is the intention of the Plan, as a matter
of reasonable expectation based on each Policy’s death benefit amount,
investment options, schedule of premiums, and other relevant Policy features,
and on the age and other relevant characteristics of the insured Participant,
but not as a matter guaranteed by the Company, any Employer, the Insurance
Company, or otherwise, that at any time after the end of the Policy’s Premium
Payment Period such Policy can be maintained in force for the remaining life
expectancy of the insured Participant without the payment of additional premiums
into the Policy, by utilizing the Policy’s cash surrender value; provided,
however, that if additional premiums are nevertheless required to be paid into
the Policy after the end of such Policy’s Premium Payment Period but while the
Company is the Owner of the Policy and the Agreement remains in effect with
respect to such Policy, the Employer(s) shall pay such premiums.

 

Article V - Payment of Premiums

 

5.1                                 On or before the due date of each periodic
Policy premium payable during the

 

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Premium Payment Period, or within any grace period after such due date permitted
by the Policy, the Employer of the Participant insured by such Policy shall pay
the full amount of such premium to the Insurance Company. The amount of the
premium which the Employer shall pay each year, and the period of years over
which such premium is expected to be paid, shall be detailed with respect to
each Participant in a schedule of premiums furnished by the Insurance Company to
the Company at the time of issuance of the Policy on the life of such
Participant.

 

5.2                                 To the extent that a Participant insured by
a Policy is deemed to have recognized taxable income each year by reason of an
Employer paying the premium amounts for life insurance benefits under a Policy,
the Employer will fully gross up the amount thereof to cover all applicable
national, federal, state, provincial, and local income taxes and withholdings
thereon. The gross up shall be computed on the basis of the highest then
applicable income tax and withholding rates and shall take into account and
include the income taxes and withholdings paid by an Employer.  The amount to be
reported as income each year shall include the amount of such economic benefit
plus the additional amount attributable to the Employer’s grossing up such
amount to cover such taxes and withholdings. The Employer will furnish the
Participant with an appropriate statement of the amount of such income
reportable by the Participant for national, federal, state, provincial and local
income tax purposes.

 

5.3                                 Notwithstanding the schedule of premiums
referred to in paragraph 5.1, if any additional premiums should be required to
be paid into a Policy while the Plan and the Agreement applicable to such Policy
remain in effect, the insured Participant’s Employer (or former Employer) shall
pay such premiums, but no additional premium payments shall be required to be
paid by an Employer on any Policy issued under the Plan after the death of the
insured Participant or the transfer of such Policy to the insured Participant
(or his or her Assignee) pursuant to paragraph 10.1.

 

5.4                                 Neither the Company nor any Employer shall
have any obligation or responsibility with respect to any estate, gift or
transfer tax liability or other adverse estate, gift or transfer tax
consequences resulting from the payment of premiums with respect to any Policy
on the life of any Participant, and the Participant (or his or her Assignee)
shall be solely responsible for any such estate, gift or transfer tax liability
or other adverse estate, gift or transfer tax consequence resulting from the
payment of such premiums.

 

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ARTICLE VI – ENDORSEMENT OF DEATH BENEFIT

 

6.1                                 To secure the payment of the Death Benefit
owed to the Participant’s (or his or her Assignee’s) Beneficiary, the Company
shall, simultaneous with the issuance of the Policy, execute an Agreement with
the Participant (or his or her Assignee) wherein the Company shall irrevocably
endorse to the Participant (or his or her Assignee) the right to designate the
Beneficiary with respect to the Death Benefit amount payable with respect to
such Policy. All rights in and to the Policy not endorsed or otherwise assigned
to the Participant (or his or her Assignee) by the Agreement shall be retained
by the Company as Owner of the Policy, subject to applicable provisions of this
Plan. The provisions of the Agreement setting forth the Company’s endorsement of
the Policy’s Death Benefit to the Participant (or his or her Assignee) shall not
be canceled, altered, or amended except as expressly provided by the provisions
of the Agreement and permitted by the Plan.

 

ARTICLE VII - POLICY INTERESTS AND RIGHTS

 

7.1                                 At any time while the Agreement applicable
to a Policy remains in effect, the Company shall be the exclusive Owner of the
Policy and shall be entitled to exercise all the rights of ownership of the
Policy. The rights of ownership which shall be exercisable by the Company shall
include all of the rights of the “owner” which are specified in the Policy,
including but not limited to the right to withdraw or borrow against any cash
surrender value of the Policy, direct the allocation of amounts paid into each
Policy, and the entire value of the Policy, among any investment options
available under the Policy, sell, assign, pledge as collateral, or otherwise
transfer, exchange or encumber the Policy, and maintain its possession, subject
only to a Participant’s (or his or her Assignee’s) right under the terms of the
Agreement and the Plan to designate or change the Beneficiary or settlement
option with respect to the Death Benefit endorsed to the Participant (or his or
her Assignee) with respect to such Policy.

 

Article VIII – Beneficiary’s Death Benefit and Satisfaction of Company’s
Obligation

 

8.1                                 The Participant (or his or her Assignee)
shall have the sole right to designate the Beneficiary of the Death Benefit
payable with respect to the Policy issued on the Participant’s life and endorsed
to the Participant (or his or her Assignee) in accordance with the terms of the
Agreement and the Plan. The Beneficiary shall be designated, and may be changed
from time to time, in accordance with procedures specified in the Policy or
otherwise prescribed by the Insurance Company.  In the event the Participant has
not designated a Beneficiary, or if the Participant’s Beneficiary shall have
predeceased the Participant, the Death Benefit shall be paid to the
Participant’s estate.

 

8.2                                 Upon the death of a Participant, the Company
and the Beneficiary shall take appropriate action to promptly obtain the
insurance proceeds payable under the Policy if the Company is the owner of such
Policy at such time. The proceeds thereof representing the Death Benefit
endorsed to the Participant (or his or her Assignee), as set forth in

 

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Article VI, shall be paid to the Beneficiary in accordance with the
Participant’s (or his or her Assignee’s) designation, the Beneficiary’s
instructions and the terms of the Policy.  The balance of such proceeds, if any,
shall be paid to the Company in a single sum.

 

8.3                                 The Company’s Obligation existing at the
Participant’s death, if any, shall be reduced to the extent the Death Benefit is
paid to the Participant’s (or his or her Assignee’s) Beneficiary.  In the event
the Company’s Obligation existing at the Participant’s death, if any, is not
fully extinguished as a result of the payment of the Death Benefit, the Company
shall pay the Participant’s (or his or her Assignee’s) Beneficiary from its own
assets the balance of the Company’s Obligation.  In addition, to the extent the
Beneficiary realizes taxable income by reason of the receipt from the
Participant’s Employer or former Employer, or the Company of the Company’s
assets in satisfaction of the balance of the Company’s Obligation, the Employer
will fully gross up the amount thereof to cover all applicable national,
federal, state, provincial and local income taxes and withholdings thereon.  The
gross up shall be computed on the basis of the highest then applicable income
tax and withholding rates and shall take into account and include the income
taxes and withholdings paid by an Employer.  The Employer will furnish the
Beneficiary with an appropriate statement of the amount of such income
reportable by the Beneficiary for national, federal, state, provincial and local
income tax purposes.

 

8.4                                 Neither the Company nor any Employer shall
have any obligation or responsibility with respect to any estate, gift or
transfer tax liability or adverse estate, gift or transfer tax consequences
resulting from the payment of the Death Benefit or the Company’s Obligation to
the Participant’s (or his or her Assignee’s) Beneficiary and the Participant (or
his or her Assignee) shall be solely responsible for any such estate, gift or
transfer tax liability or other adverse estate, gift or transfer tax consequence
resulting from such payment.

 

Article IX - Retirement or Other Termination of Employment

 

9.1                                 If a Participant’s Termination Date occurs
by reason of the Participant’s Retirement or Disability, the occurrence of such
Termination Date shall not cause the Agreement to be terminated.

 

9.2                                 If a Participant’s Termination Date occurs
for any reason other than the Participant’s Retirement, Disability, or death,
the Company’s Obligation and the obligations of the Company and the Employer
under the terms of the Plan and the Agreement with such Participant (or his or
her Assignee) to provide the Death Benefit shall terminate effective as of the
Participant’s Termination Date, and thereafter the Company and the Employer
shall be under no further obligation to make premium payments or to take any
other action to maintain the Policy in force or to preserve the Policy’s Death
Benefit in any manner.

 

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9.3                                 In the circumstances described in paragraph
9.2, above, the Participant (or his or her Assignee) may elect, by written
notice to the Administrator given no later than 30 days after such Termination
Date, to acquire the Policy from the Company at its fair market value, whereupon
the Participant (or his or her Assignee) will assume full responsibility for the
payment of all future premiums.  The fair market value of the Policy will be
determined in accordance with applicable Internal Revenue Service rules, and
will generally be the cash value of the Policy, without reduction for any
surrender charges.

 

ARTICLE X – TRANSFER OF POLICY

 

10.1                           Notwithstanding paragraph 9.1 to the contrary,
the Company shall transfer the ownership of the Policy insuring a Non-U.S.
Retiree’s life to such Non-U.S. Retiree (or his or her Assignee) on such
Non-U.S. Retiree’s Distribution Date whereupon the Company and the Employer
shall be under no further obligation to make premium payments or to take any
other action to maintain the Policy in force or preserve the Policy’s Death
Benefit in any manner.  Notwithstanding paragraph 8.3 to the contrary, the
Company’s Obligation shall be fully extinguished and the obligations of the
Company and the Employer under the terms of the Plan and the Agreement with such
Non-U.S. Retiree (or his or her Assignee) to provide the Death Benefit shall
terminate if the current accumulation value of the transferred Policy at the
Distribution Date is sufficient at then current mortality charges and a
guaranteed 4% crediting rate to keep such Policy in force until the date such
Non-U.S. Retiree reaches age 100 (the maturity age of the Policy) in an amount
at least equal to the Death Benefit.  If the current accumulation value of the
transferred Policy at the Distribution Date is not sufficient at then current
mortality charges and a guaranteed 4% crediting rate to keep such Policy in
force until the date such Non-U.S. Retiree reaches age 100 (the maturity age of
the Policy) in an amount at least equal to the Death Benefit, then the Company’s
Obligation shall be reduced to an amount equal to the difference between the
Company’s Obligation immediately prior to the transfer of such Policy and the
amount of Death Benefit supported by the transferred Policy’s current
accumulation value at the Distribution Date.

 

10.2                           In the event the Company transfers the ownership
of a Policy to a Non-U.S. Retiree (or his or her Assignee) pursuant to paragraph
10.1 above and the Non-U.S. Retiree insured by such Policy realizes taxable
income by reason of the transferred Policy, the Employer will fully gross up the
amount thereof to cover all applicable national, federal, state, provincial and
local income taxes and withholdings thereon.  The gross up shall be computed on
the basis of the highest then applicable income tax and withholding rates and
shall take into account and include the income taxes and withholdings paid by
the Employer. The Employer will furnish the Non-U.S. Retiree with an appropriate
statement of the amount of such income reportable by the Non-U.S. Retiree for
national, federal, state, provincial and local income tax purposes.

 

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10.3                           Neither the Company nor any Employer shall have
any obligation or responsibility with respect to any estate, gift or transfer
tax liability or adverse estate, gift or transfer tax consequences resulting
from the transfer of a Policy to any Participant (or his or her Assignee) and
the Participant (or his or her Assignee) shall be solely responsible for any
such estate, gift or transfer tax liability or other adverse estate, gift or
transfer tax consequence resulting from such transfer.

 

Article XI – Assignment by Participant

 

11.1                           Notwithstanding any provision hereof to the
contrary, coincident with his or her participation in the Plan or on any date
thereafter, a Participant shall have the right to absolutely and irrevocably
assign by gift to an Assignee all or any portion of his or her right, title and
interest in and to the Company’s Obligation and in and to the Death Benefit
payable with respect to a Policy on such Participant’s life.  This right shall
be exercisable by having the Assignee execute the Agreement with the Company on
behalf of the Participant in the form attached hereto as Exhibit A-1.  Upon the
execution of such Agreement by the Assignee and the Company, the Company shall
thereafter treat the Participant’s Assignee as the sole owner of all of the
Participant’s right, title and interest in and to the Company’s Obligation and
in and to the Death Benefit provided under this Plan.  Thereupon and thereafter,
the Participant shall have no right, title or interest in and to the Company’s
Obligation or in and to the Death Benefit provided for in this Plan, the
Agreement or the Policy, all such rights being vested in and exercisable only by
such Assignee.

 

Article XII - Plan Termination

 

12.1                           The Company reserves the right to unilaterally
discontinue or suspend the Employers’ payment of premiums under the Plan at any
time or to terminate the Plan at any time. The Plan shall terminate upon the
total cessation of the business of the Company or upon the bankruptcy,
receivership or dissolution of the Company.

 

12.2                           Upon termination of the Plan or the complete
discontinuance of the payment of premiums under the Plan, the Company shall be
entitled to take whatever actions it desires, in its sole and absolute
discretion, with respect to each Policy under the Plan; provided, however, the
Company’s Obligation with respect to each such Participant (or his or her
Assignee) shall survive such Plan termination or discontinuance of premium
payments.

 

Article XIII - Plan Amendments

 

13.1                           Except as may be otherwise expressly limited in a
Participant’s Agreement, the Company reserves the right to amend the Plan in any
respect and at any time and from time to time. However, the Company shall not
amend the Plan in any manner, or take or omit any other action, that has the
effect of reducing the amount of the Company’s Obligation to a Participant (or
his or her Assignee) without the Participant’s (or his or her Assignee’s)
express written consent.

 

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Article XIV - Insurance Company

 

14.1                           The Insurance Company will be fully discharged
from its obligations under the Policy by its payment of the Policy death benefit
to the beneficiary(ies) designated in the Policy, subject to the terms of the
Policy. The Insurance Company will not, in any event, be considered a party to
this Plan or to any Agreement, or to any modification or amendment of the Plan
or any Agreement.

 

ARTICLE XV - ADMINISTRATION AND CLAIMS

 

15.1                           The following provisions of this paragraph 15.1
shall apply if and only if the Plan is determined to constitute an employee
welfare benefit plan under Section 3(1) of the Employee Retirement Income
Security Act of 1974, as amended (“ERISA”):

 

(a)                                  The Plan shall be administered by the
Administrator, and the Administrator shall have full discretionary authority and
responsibility for the operation and management of the Plan, including the
interpretation of the Plan and any Agreement thereunder.

 

(b)                                 The named fiduciary or fiduciaries are the
Company and/or one or more officers or employees of the Company duly appointed
to exercise fiduciary authority and responsibility with respect to the Plan.

 

(c)                                  The funding policy under this Plan
anticipates that all premiums on each Policy shall be remitted by the
Employer(s) to the Insurance Company when due, and all benefits under the Plan
shall be provided pursuant to a contract or contracts with any insurance company
or companies authorized to do business in the state of Ohio, as selected by the
Company.

 

(d)                                 Direct payment by the Insurance Company is
the primary basis of payment of benefits under this Plan, with those benefits in
turn being based on the payment of premiums as provided in the Plan.

 

(e)                                  The claims procedure of the Plan shall be
as follows:

 

(i)                                     The Owner of a Policy, a Beneficiary, or
a duly authorized representative thereof may make a claim for benefits by filing
a claim with the Administrator on a form made available for that purpose. The
Administrator shall make the initial determination as to the treatment of the
claim and give the claimant notice thereof within 90 days after receipt of the
claim. If for any reason a claim for benefits under this Plan is denied by the
Administrator, it shall deliver to the claimant a written

 

11

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explanation setting forth the specific reason for the denial, pertinent
references to the Plan provision on which the denial is based, such other data
as may be pertinent and information on the procedures to be followed by the
claimant in obtaining a review of the claim, all written in a manner calculated
to be understood by the claimant. For this purpose:

 

(A)                              The claimant’s claim shall be deemed filed when
presented in writing to the Administrator.

 

(B)                                The Administrator’s determination and
explanation shall be in writing delivered to the claimant within 90 days of the
date the claim is filed.

 

(ii)                                  The claimant shall have 60 days following
his or her receipt of the denial of the claim to file with the Company a written
request for review of the denial. For such review, the claimant or a
representative thereof may submit pertinent documents and written issues and
comments.

 

(iii)                               The Company shall decide the issue on review
and furnish the claimant with a copy of its determination within 60 days of
receipt of the claimant’s request for review of the claim. The decision shall be
in writing and shall include specific reasons for the decision written in a
manner calculated to be understood by the claimant, as well as specific
reference to the pertinent Plan provisions on which the decision is based. If a
copy of the decision is not furnished to the claimant within such 60-day period,
the claim shall be deemed denied on review.

 

ARTICLE XVI - MISCELLANEOUS

 

16.1                           The Plan Documents shall constitute the entire
documentation of the Plan. No representations, warranties, covenants,
understandings or agreements, oral or otherwise, in relation to the subject
matter hereof, other than those set forth in the Plan Documents, shall be valid.

 

16.2                           The Plan and the Plan Documents shall not
constitute an inducement or consideration for the employment of any Non-U.S.
Employee or Participant and shall not give any Non-U.S. Employee or Participant
any right to be retained in the employ of any Employer, and each Employer hereby
retains the right to discharge any Non-U.S.

 

12

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Employee or Participant at any time, in accordance with the personnel policies
of the Employer, or as provided in any employment agreement between the Employer
and the Non-U.S. Employee or Participant.

 

16.3                           This Plan shall be binding upon and inure to the
benefit of each Participant, and his or her heirs, successors, assigns, and
personal representatives, and the Company and each Employer, and their
respective successors and assigns.

 

16.4                           In the event that any part of this Plan shall be
deemed invalid for any reason, such invalidity shall not affect the remainder of
this Plan, which shall remain valid and binding upon all interested parties and
enforceable in accordance with its terms.

 

16.5                                 Except where otherwise indicated by the
context, any use of the masculine gender herein shall also refer to the feminine
and vice versa, and the use of any term herein in the singular shall also, where
appropriate, include the plural and vice versa.

 

16.6                           Except as otherwise required by the laws of the
United States of America, the Plan Documents shall be construed in accordance
with and governed by the laws of the state of Ohio.

 

 

IN WITNESS WHEREOF, the Company has caused this Plan to be duly executed by its
duly authorized officer(s) on this                 day of
                          , 2004.

 

 

 

OWENS-ILLINOIS, INC.

 

 

 

 

 

 

 

By:

/s/ Thomas L. Young

 

 

Thomas L. Young

Attest:

 

Executive Vice President and

 

 

Chief Financial Officer

/s/ James W. Baehren

 

 

 

James W. Baehren

 

 

 

Senior Vice President,

 

 

 

Chief Administrative Officer and

 

 

 

General Counsel

 

 

 

 

 

 

 

 

 

13

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OWENS-ILLINOIS

2004 EXECUTIVE LIFE INSURANCE PLAN FOR NON-U.S. EMPLOYEES

PARTICIPATION AGREEMENT

 

(Exhibit A to the

Owens-Illinois 2004 Executive Life Insurance Plan for Non-U.S. Employees)

 

This Participation Agreement (the “Agreement”) is made by and between
Owens-Illinois, Inc. (the “Company”) and
                                                                                    
(the “Participant”), pursuant to the Owens-Illinois 2004 Executive Life
Insurance Plan for Non-U.S. Employees (the “Plan”).  The Company has selected
Jefferson-Pilot Life Insurance Company (the “Insurance Company” or “Jefferson
Pilot”) to provide life insurance protection (the “Policy”) in accordance with
the terms of the Plan.  The Company requests that Jefferson Pilot retain a copy
of this Agreement with the Policy.

 

Jefferson Pilot Policy Number

 

Participant

 

 

 

 

 

 

 

 

 

 

The Participant designates the following as the Beneficiary of the Death
Benefit.

 

{BENEFICIARY:

{RELATIONSHIP:                                                }

                                               }

 

{ADDRESS:                                                            }

 

{                   

{TAX ID (SOCIAL SECURITY) NUMBER}

                                                  }

 

{                                                                           }

{                                                        }

 

IT IS AGREED:

 

A.                                   By executing this Agreement, the
Participant agrees and acknowledges that any existing Death Benefit Only
Agreement he or she has entered into with the Company is now hereby terminated
and that any obligations of the Company under said Death Benefit Only Agreement
are being replaced by the Company’s Obligation under the Plan and this
Participation Agreement.

 

B.                                     All of the terms, provisions, and
conditions of the Plan are hereby incorporated into this Agreement.  Capitalized
terms defined in the Plan and not otherwise defined in this Agreement shall have
the meaning assigned in the Plan.

 

C.                                     Commencing on
                                  , the Participant agrees to participate in the
Plan and become subject to its terms, and the Company agrees that the
Participant’s Employer(s) or former Employer(s) will contribute premiums in
accordance with the Plan for the period of time and in the amounts determined
thereunder. Both parties to this

 

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

 

Agreement understand that benefits under the Plan shall be provided by the above
identified Policy issued or to be issued by the Insurance Company.

 

D.                                    Notwithstanding the foregoing provisions
of this Agreement or any contrary provisions of the Plan, the Company agrees
that at any time while this Agreement remains in effect before the Participant’s
Termination Date, or on or after the Participant’s Termination Date if such
Termination Date occurred by reason of the Participant’s Retirement or
Disability, or in the case of a Non-U.S. Retiree on the Effective Date, the
Death Benefit payable to the Beneficiary shall equal
$                                               ;

 

E.                                      The Company shall be the sole owner of
the Policy, but by executing this Agreement the Company hereby irrevocably
endorses to the Participant the Death Benefit under the Policy as described in
paragraph D above.  During such time as the Company is the owner of the Policy,
the Company will be entitled to receive the amount of any death benefit paid
under the Policy in excess of the Death Benefit payable to the Beneficiary.  If
the Participant terminates his or her employment by reason of his or her
Retirement or Disability, or if the Participant is a Non-U.S. Retiree on the
Effective Date, the Company will transfer the ownership of the Policy to the
Participant on his or her Distribution Date. If the Participant terminates his
or her employment for reasons other than Retirement or Disability, the
Participant shall have the right to acquire the Policy from the Company for its
then current fair market value and to pay all future premiums thereon.

 

F.                                      The Participant’s Employer(s) or former
Employer(s) will fully gross up any taxable income realized by the Participant
that is attributable to the economic benefits received from the endorsed Death
Benefit and the value of a Policy transferred to the Participant pursuant to
paragraph E above to cover all applicable national, federal, state, provincial
and local income taxes and withholdings thereon.  The gross up shall be computed
on the basis of the highest then applicable income tax and withholding rates and
shall take into account and include the income taxes and withholdings paid by an
Employer.

 

G.                                     This Agreement may be amended only by the
mutual written consent of the Company and the Participant.

 

H.                                    This Agreement shall remain in effect from
its effective date until the death of the Participant, unless terminated earlier
in connection with the Participant’s termination of employment for any reason
other than Retirement or Disability, as provided in the Plan, or until the
transfer by the Company of the ownership of the Policy to the Participant
pursuant to paragraph E above.

 

I.                                         The Company’s Obligation to the
Participant shall continue notwithstanding the termination of the Plan, the
Company’s discontinuance of the payment of premiums under the Plan, or the
cancellation, lapse, or surrender of the Policy for any reason, unless the
Participant’s Termination Date occurs for any reason other than Retirement,
Disability or death, or until the Company transfers ownership of the Policy to
the Participant, in which case the Company’s Obligation shall be reduced by the
amount of Death Benefit supported by such Policy at the time of the transfer.

 

2

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

 

Dated as of the             day of                                          ,
20         .

 

 

PARTICIPANT:

OWENS-ILLINOIS, INC.

 

 

 

 

 

 

By:

 

 

 

 

Name

 

 

Name

 

 

 

 

Social Security Number

 

 

Tax ID Number:

 

 

 

3

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

 

OWENS-ILLINOIS

2004 EXECUTIVE LIFE INSURANCE PLAN FOR NON-U.S. EMPLOYEES

PARTICIPATION AGREEMENT

 

(Exhibit A-1 to the

Owens-Illinois 2004 Executive Life Insurance Plan for Non-U.S. Employees)

 

This Participation Agreement (the “Agreement”) is made by and between
Owens-Illinois, Inc. (the “Company”) and
                                                     (the “Assignee”) as the
Assignee  and designated Beneficiary of                                     (the
“Participant”), pursuant to the Owens-Illinois 2004 Executive Life Insurance
Plan for Non-U.S. Employees (the “Plan”).  The Company has selected
Jefferson-Pilot Life Insurance Company (the “Insurance Company” or “Jefferson
Pilot”) to provide life insurance protection (the “Policy”) in accordance with
the terms of the Plan.  The Company requests that Jefferson Pilot retain a copy
of this Agreement with the Policy.

 

Jefferson Pilot Policy Number

 

Participant

 

 

 

 

 

 

 

 

 

 

The Assignee hereby designates himself/herself/itself as the Beneficiary of the
Death Benefit.

 

IT IS AGREED:

 

A.                                   By executing this Agreement, the Assignee
agrees and acknowledges that any existing Death Benefit Only Agreement the
Participant entered into with the Company is now hereby terminated and that any
obligations of the Company’s under said Death Benefit Only Agreement are being
replaced by the Company’s Obligation under the Plan and this Participation
Agreement.

 

B.                                     All of the terms, provisions, and
conditions of the Plan are hereby incorporated into this Agreement.  Capitalized
terms defined in the Plan and not otherwise defined in this Agreement shall have
the meaning assigned in the Plan.

 

C.                                     Commencing on
                                       , the Assignee agrees to participate in
the Plan and become subject to its terms, and the Company agrees that the
Participant’s Employer(s) or former Employer(s) will contribute premiums in
accordance with the Plan for the period of time and in the amounts determined
thereunder. Both parties to this Agreement understand that benefits under the
Plan shall be provided by the above identified Policy issued or to be issued by
the Insurance Company.

 

D.                                    Notwithstanding the foregoing provisions
of this Agreement or any contrary provisions of the Plan, the Company agrees
that at any time while this Agreement remains in effect before the Participant’s
Termination Date, or on or after the Participant’s Termination Date if such
Termination Date occurred by reason of the Participant’s Retirement or

 

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

 

Disability, or in the case of a Non-U.S. Retiree on the Effective Date, the
Death Benefit payable to the Beneficiary shall equal
$                                  .

 

E.                                      The Company shall be the sole owner of
the Policy, but by executing this Agreement the Company hereby irrevocably
endorses to the Assignee the Death Benefit under the Policy as described in
paragraph D above and acknowledges and accepts the Participant’s irrevocable
assignment of his or her interest in the Company’s Obligation to the Assignee.
During such time as the Company is the owner of the Policy, the Company will be
entitled to receive the amount of any death benefit paid under the Policy in
excess of the Death Benefit payable to the Beneficiary.  If the Participant
terminates his or her employment by reason of his or her Retirement or
Disability, or if the Participant is a Non-U.S. Retiree on the Effective Date,
the Company will transfer the ownership of the Policy to the Assignee on the
Participant’s Distribution Date. If the Participant terminates his or her
employment for reasons other than Retirement or Disability, the Assignee shall
have the right to acquire the Policy from the Company for its then current fair
market value and to pay all future premiums thereon.

 

F.                                      The Participant’s Employer(s) or former
Employer(s) will fully gross up any taxable income realized by the Participant
that is attributable to the economic benefits received from the endorsed Death
Benefit and the value of a Policy transferred to the Assignee pursuant to
paragraph E above to cover all applicable national, federal, state, provincial
and local income taxes and withholdings thereon.  The gross up shall be computed
on the basis of the highest then applicable income tax and withholding rates and
shall take into account and include the income taxes and withholdings paid by an
Employer.  Neither the Company nor the Participant’s Employer(s) or former
Employer(s) shall have any obligation or responsibility with respect to any
estate, gift or transfer tax liability or other adverse estate, gift or transfer
tax consequences with respect to the payment of premiums on the Policy or the
transfer of the Policy to the Assignee pursuant to paragraph E above.

 

G.                                     This Agreement may be amended only by the
mutual written consent of the Company and the Assignee.

 

H.                                    This Agreement shall remain in effect from
its effective date until the death of the Participant, unless terminated earlier
in connection with the Participant’s termination of employment for any reason
other than Retirement or Disability, as provided in the Plan, or until the
transfer by the Company of the ownership of the Policy to the Assignee pursuant
to paragraph E above.

 

I.                                         The Company’s Obligation to the
Assignee shall continue notwithstanding the termination of the Plan, the
Company’s discontinuance of the payment of premiums under the Plan, or the
cancellation, lapse, or surrender of the Policy for any reason, unless the
Participant’s Termination Date occurs for any reason other than Retirement,
Disability or death, or until the Company transfers ownership of the Policy to
the Assignee, in which case the Company’s Obligation shall be reduced by the
amount of Death Benefit supported by such Policy at the time of the transfer.

 

2

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

 

Dated as of the               day of
                                             , 20        .

 

 

ASSIGNEE:

OWENS-ILLINOIS, INC.

 

 

 

 

 

 

By:

 

 

 

 

Name

 

 

Name

 

 

 

 

Address

 

 

Tax ID Number:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Social Security Number

 

 

 

 

3

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