Suzhou Equity Transfer Agreement

This Suzhou Equity Transfer Agreement (this “Transfer Agreement”) is dated as of
October 31, 2008, and is by and between:

Novolyte Technologies Limited (“Novolyte HK”), a limited company incorporated
under the laws of the Special Administrative Region of Hong Kong, P.R.C. (“Hong
Kong”),

Novolyte Technologies LP, a Delaware limited partnership (“Parent” and together
with Novolyte HK, the “Buyer Parties”),

- and -

Ferro Corporation (“Ferro”), an Ohio corporation.

Recitals

A.   Ferro owns 100% of the equity interests (the “Suzhou Equity Interest”) of
Ferro (Suzhou) Energy Storage Materials Co. Ltd. (“Ferro Suzhou”), a
wholly-foreign owned enterprise established under the applicable laws and
regulations of the People’s Republic of China (the “P.R.C.”), having its legal
address at No. 15 Suhong East Road, Suzhou Industrial Park, Suzhou City, Jiangsu
Province, P.R.C.

B.   Novolyte HK is a wholly-owned limited company of Parent.

     
C.
D.
  Ferro Suzhou is engaged in the business of making electrolytes and
related products and providing services related to such products as
specified in Ferro Suzhou’s business license (the “Fine Chemicals
Business”).
Novolyte HK desires to purchase from Ferro, and Ferro desires to sell to
Novolyte HK, the Suzhou Equity Interest pursuant to the terms and
conditions of this Transfer Agreement.

Agreement

In consideration of the premises and the mutual covenants and agreements
contained in this Transfer Agreement, Ferro and Novolyte HK agree as follows:

Article I

Defined Terms; The Equity Transfer

1.1.   Certain Defined Terms. Appendix A sets forth the definitions of certain
terms used in this Transfer Agreement. Those terms shall have the meanings set
forth on Appendix A where used in this Transfer Agreement and identified with
initial capital letters.

1.2.

    Transaction. On and subject to the terms and conditions of this Transfer
Agreement, at the Suzhou Equity Closing, Ferro shall sell, transfer, assign and
deliver to Novolyte HK, and Novolyte HK shall purchase, acquire and accept from
Ferro, all of Ferro’s right, title and interest in the Suzhou Equity Interest,
free from all Encumbrances (the “Suzhou Equity Transfer”).

Article II

Purchase Price

2.1.   Purchase Price. The aggregate purchase price for the Suzhou Equity
Interest (the “Purchase Price”) is Eight Million United States Dollars
($8,000,000) (US) (the “Cash Amount”). The parties acknowledge and agree that
simultaneous with the execution of this Transfer Agreement, the Cash Amount has
been transferred by either of the Buyer Parties to U.S. Bank, National
Association (the “Escrow Agent”) to be held by the Escrow Agent until the
disbursement thereof pursuant to the terms of an escrow agreement entered into
by and among Parent, the Escrow Agent and Ferro of even date herewith (the
“Escrow Agreement”).

2.2.   Estimated Taxes. At the Suzhou Equity Closing, Ferro or its designee
shall pay an amount equivalent to any tax, registration fees, stamp duties, or
other transfer fees, taxes or imports applicable to the Suzhou Equity Transfer
pursuant to applicable P.R.C. laws and regulations (before final determination,
the “Estimated Taxes” and after confirmation by the applicable Governmental
Entity, the “Actual Taxes”) determined by Ferro and Parent to be payable as a
result of the Suzhou Equity Transfer, including any taxes due pursuant to
Article 3 of the P.R.C. Enterprise Income Tax Law (effective as of January 1,
2008) and Article 6 of the Detailed Implementation Rules thereunder (the
“Estimated EI Tax”). Ferro shall make such payment(s), including the Estimated
EI Tax, to the relevant Governmental Entities and shall provide Parent with a
tax completion certificate and any other relevant documentation, such as
original receipts, within thirty (30) days after the date of such payment(s). If
any relevant Governmental Entity determines that the Estimated Taxes are greater
than the Actual Taxes, Ferro shall be entitled to a refund of the same. If any
relevant Governmental Entity determines that the Estimated Taxes are less than
the Actual Taxes, Ferro shall promptly cause the difference, together with any
applicable interest and penalties, to be paid to the relevant Governmental
Entity.

2.3.   Payments at Suzhou Equity Closing. At the Suzhou Equity Closing, the
Escrow Agent shall be authorized the Buyer Parties to pay Ferro the Cash Amount
in immediately available funds pursuant to the written instructions of Ferro
provided to the Escrow Agent at least five (5) days before the Suzhou Equity
Closing.

Article III

Signing Deliveries

3.1.   Generally. Simultaneously with the execution and delivery of this
Transfer Agreement, the parties shall make the deliveries described in this
Article III. Any agreement or document to be delivered pursuant to this Transfer
Agreement which is not attached to this Transfer Agreement, must be in form and
substance reasonably satisfactory to the party to which it is being delivered,
it being agreed that all documents, certificates, licenses, permits, and
approvals related to the Split-Off Transaction, incorporation and establishment
of Ferro Suzhou that have been filed or registered with or issued by the
Approval Authority and the Registration Authority and been made available by
Ferro to Novolyte HK are satisfactory to Novolyte HK and Parent.

3.2.   Ferro’s Deliveries. Ferro hereby delivers to Novolyte HK:

  (A)   A certified copy of the resolutions of Ferro Suzhou’s Board of Directors
and Ferro’s Board of Directors approving, Ferro’s execution, delivery and
performance of this Transfer Agreement and the other documentation referenced
herein, the terms of which Ferro Suzhou’s board resolutions shall be
substantially in the form of Schedule 1 attached hereto

  (B)   The application letter (the “Application Letter”) to be submitted to the
Approval Authority, completed and duly signed by an authorized representative of
Ferro Suzhou and/or an authorized representative of Novolyte HK, as required by
the Approval Authority, the terms of which shall be substantially in the form of
Schedule 2 attached hereto;

  (C)   A copy of the Articles of Association of Ferro Suzhou, which is attached
hereto as Schedule 3;

  (D)   A copy of the current Certificate of Approval and the current Business
License of Ferro Suzhou, which is attached hereto as Schedule 4;

  (E)   A copy of the current standard employment contract of the employees of
Ferro Suzhou (together with a form addendum thereto), which is attached hereto
as Schedule 5; and

  (F)   A notification letter of the removal, effective as of the Suzhou Equity
Closing Date, of the directors, supervisor and legal representative of Ferro
Suzhou, the terms of which shall be substantially in the form of Schedule 6
attached hereto.

3.3.   Novolyte HK and Parent Deliveries. Novolyte HK and Parent hereby deliver
to Ferro:

  (A)   A certified copy of the resolutions of Parent and Novolyte HK’s board of
managers or directors, as applicable, approving, without limitation, Novolyte
HK’s and Parent’s execution, delivery and performance of this Transfer Agreement
and the other documentation referenced herein, the terms of which shall be
substantially in the form of Schedule 7 attached hereto;

  (B)   An executed copy of the Amendment to the Articles of Association of
Ferro Suzhou, which among other things, shall change the name of Ferro Suzhou as
well as the legal representative thereof (the “Amended Articles”), which Amended
Articles shall be effective as of the Suzhou Equity Closing Date, the terms of
which shall be substantially in the form of Schedule 8 attached hereto;

  (C)   A letter of appointment of the new directors, supervisor and legal
representative of Ferro Suzhou, effective as of the Suzhou Equity Closing Date,
together with appropriate identification documents, photographs and resumes of
the new directors and legal representative of Ferro Suzhou;

  (D)   A certified and legalized copy of Novolyte HK’s Memorandum of Articles
and Articles of Association to show its good standing substantially in the form
required by the Approval Authority;

  (E)   A bank reference letter to show Novolyte HK as a new investor financial
standing substantially in the form required by the Approval Authority.

  (F)   A letter of authorization dated the date hereof issued by Novolyte HK to
authorize Ferro and Ferro Suzhou to date and submit any of the above documents
and other undated documents signed by Novolyte HK and Ferro Suzhou and take all
related actions on their behalf in connection with the Suzhou Equity Transfer
and the subsequent application for the New Business License; and

  (G)   All such other documentation required to be prepared or delivered by
Novolyte HK in connection with the approval of the Suzhou Equity Transfer and
this Transfer Agreement with the Approval Authority and the subsequent
application for the New Business License.

Article IV

Covenants

4.1.   Filings and Consents. Each of Ferro and Novolyte HK shall use all
commercially reasonable efforts to take, or cause to be taken, all appropriate
action to do, or cause to be done, all things necessary, proper or advisable
under applicable law or otherwise to consummate and make effective the
transactions contemplated by this Transfer Agreement as promptly as practicable.
Subject to the foregoing, as soon as practicable after Ferro Suzhou has received
the Ancillary Certificates from the relevant governmental authorities following
the Split-Off Transaction (the exact timing to be determined by Ferro Suzhou),
Ferro shall submit the Application Letter and this Transfer Agreement, together
with all other applicable documentation, including the Amended Articles and all
other documents attached hereto, to the Chinese approval authority that
originally granted its approval for the establishment of Ferro Suzhou (the
“Approval Authority”) for its examination and approval of the Suzhou Equity
Transfer. Promptly after approval of the Suzhou Equity Transfer by the Approval
Authority and receiving a notice from Ferro, Novolyte HK shall cause Ferro
Suzhou to apply to the Registration Authority for a new business license for
Ferro Suzhou, which new business license shall have the same business scope as
the current business license of Ferro Suzhou (the “New Business License”), and
hereby also authorizes Ferro to date and make such application and take all
related actions on its and Ferro Suzhou’s behalf in connection therewith.

4.2.   Further Assurances. Each of Ferro and Novolyte HK agree that each will
execute and deliver any and all documents in addition to those expressly
provided for herein and will take all actions (and cause their affiliated
entities, personnel and Ferro Suzhou to do the same) that may be necessary or
appropriate to effect the provisions of this Transfer Agreement and each of the
other agreements and instruments delivered by them in connection herewith and
therewith, including the Chinese version of this Transfer Agreement and any such
other agreements and instruments as may be required by the Approval Authority.

Article V

Closing of Equity Transfer

5.1.   Closing. The closing of the transactions contemplated by this Transfer
Agreement (the “Suzhou Equity Closing”) shall be held after the conditions set
forth in Sections 5.2, 5.3 and 5.4 are satisfied or waived by the appropriate
party or such later date mutually agreed upon in writing by the parties. The
date on which the Suzhou Equity Closing takes place and the Suzhou Equity
Transfer is effective is referred to in this Transfer Agreement as the “Suzhou
Equity Closing Date.” The conditions and deliveries described in Sections 5.2,
5.3 and 5.4 hereof shall be mutually interdependent and shall be regarded as
occurring simultaneously, and, notwithstanding any other provisions of this
Transfer Agreement, no such condition or delivery shall become effective or
shall be deemed to have occurred until all of the other conditions and
deliveries provided for in Section 5.2, Section 5.3 and Section 5.4 shall also
have occurred or have been waived by the appropriate party.

5.2.   Mutual Conditions. The respective obligations of Novolyte HK and Parent
on the one hand, and Ferro on the other hand, to consummate the transactions
contemplated by this Transfer Agreement shall be subject to the fulfillment, at
or before the Suzhou Equity Closing, of each of the following conditions, any of
which may, to the extent permitted by applicable law, be waived in writing by
either Novolyte HK or Parent on the one hand, or Ferro on the other hand, in its
sole discretion (provided that such waiver shall only be effective against such
party):

  (A)   No Governmental Entity shall have enacted, issued, promulgated or
enforced any statute, rule, regulation, executive order, decree, judgment,
preliminary or permanent injunction or other order that is in effect and that
prohibits, enjoins or otherwise restrains the Suzhou Equity Transfer and no such
action shall be threatened or pending.

  (B)   There shall not have been issued and in effect, or threatened or
pending, any injunction, action, suit or similar legal order or other proceeding
seeking or threatening to prohibiting or restraining or any action by any
Governmental Entity seeking to enjoin the consummation of any of the
transactions contemplated in this Transfer Agreement.

  (C)   The Approval Authority shall have approved the Suzhou Equity Transfer
pursuant to the terms of this Transfer Agreement and shall have issued to Ferro
a certificate evidencing approval of the Suzhou Equity Transfer.

  (D)   The New Business License shall have been issued to Ferro Suzhou.

5.3.   Conditions to Ferro’s Obligations. The obligation of Ferro to consummate
the transactions contemplated by this Transfer Agreement shall be subject to the
fulfillment, at or before the Suzhou Equity Closing, of each of the following
conditions, any of which may be waived in writing by Ferro, in its sole
discretion:

  (A)   All of the representations and warranties of Novolyte HK contained
herein are true, accurate, and complete in all material respects as of the date
hereof and are true, accurate, and complete in all material respects as of the
Suzhou Equity Closing (as if such representations and warranties had been made
anew as of the Suzhou Equity Closing except with respect to the effect of
transactions contemplated or permitted hereby).

  (B)   Ferro shall have received a certificate (dated the Suzhou Equity Closing
Date) from authorized directors and/or officers of Novolyte HK certifying that
the condition set forth in Section 5.3(A) has been satisfied as of the Closing
Date.

5.4.   Conditions to Novolyte HK’s and Parent’s Obligations. The obligation of
Novolyte HK and Parent to consummate the transactions contemplated by this
Transfer Agreement shall be subject to the fulfillment, at or before the Suzhou
Equity Closing, of each of the following conditions, any of which may be waived
in writing by Novolyte HK and Parent, in their sole discretion:

  (A)   Ferro Suzhou shall have obtained all other permits, licenses, approvals
and qualifications issued by any Governmental Entity necessary for Ferro Suzhou
to operate as a stand alone entity immediately following the Suzhou Equity
Closing, except where the failure to obtain any such permits, licenses,
approvals and qualifications would not reasonably be expected to have a material
adverse affect on the business of Ferro Suzhou, and expressly excluding from
such determination, a safety production license, tax and customs registrations
required after the Suzhou Equity Closing and items related thereto.

  (B)   Ferro shall have procured the resignation, effective as of the Suzhou
Equity Closing Date, of all of the directors, supervisor and the legal
representative of Ferro Suzhou appointed by Ferro, and shall have delivered to
Novolyte HK and Parent original copies of the same, together with a general
release from liability of Ferro Suzhou by such directors and the legal
representative, a form of which is attached hereto as Schedule 9

  (C)   Novolyte HK shall have received a certificate (dated the Suzhou Equity
Closing Date) from authorized directors and/or officers of Ferro certifying that
the conditions set forth in Sections 5.4(A) and (B) have been satisfied as of
the Closing Date.

Article VI

Representations and Warranties

6.1 Ferro’s Representations and Warranties. Ferro represents and warrants to
Novolyte HK and Parent as follows:

  (A)   Organization and Existence. Ferro is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Ohio and
Ferro Suzhou is a wholly-owned foreign enterprise organized and existing under
the laws of the P.R.C.

  (B)   Capitalization of Ferro Suzhou. Ferro Suzhou has a total investment of
$8,032,000 (U.S.) and registered capital of $4,016,000 (U.S.) (to be updated as
may be applicable at the Suzhou Equity Closing), all of which is owned by Ferro.
The Suzhou Equity Interest has been duly issued, fully paid, and is
nonassessable. Neither Ferro nor Ferro Suzhou has issued or granted to any
person any option, warrant, conversion right, or other right, interest or
benefit of any kind to acquire any other equity capital of Ferro Suzhou.

  (C)   Ownership of the Suzhou Equity Interest. Ferro owns all of the issued
and outstanding equity interests of Ferro Suzhou free of Encumbrances.

  (D)   Power and Authority. Ferro has full power and authority under its
constitutive documents and the laws of the State of Ohio to execute, deliver,
and perform this Transfer Agreement.

  (E)   Authorization. The execution, delivery, and performance of this Transfer
Agreement by Ferro has been duly authorized by all requisite corporate action on
the part of Ferro.

  (F)   Binding Effect. This Transfer Agreement is a valid, binding, and legal
obligation of Ferro.

  (G)   No Default. Neither the execution and delivery of this Transfer
Agreement nor Ferro’s full performance of its obligations under this Transfer
Agreement will violate or breach, or otherwise constitute or give rise to a
Default under, the terms or provisions of Ferro’s constitutive documents or of
any material contract, commitment, or other obligation to which Ferro is a
party.

  (H)   Finders. With the sole exception of KeyBanc Capital Markets, Ferro has
not engaged and are not directly or indirectly obligated to any person acting as
a broker, finder, or similar capacity in connection with the transactions
contemplated by this Transfer Agreement.

6.2.   Novolyte HK’s and Parent’s Representations and Warranties. Novolyte HK
and Parent represent and warrant to Ferro as follows:

  (A)   Organization and Existence. Novolyte HK is a limited company duly
organized, validly existing and in good standing under the laws of Hong Kong.
Parent is a Delaware limited partnership, duly organized, validly existing and
in good standing under the laws of the State of Delaware.

  (B)   Power and Authority. Each of Parent and Novolyte HK has full corporate
and company power and authority, as the case may be, under its respective
constitutive documents and under the laws of Delaware and Hong Kong,
respectively, to execute, deliver, and perform this Transfer Agreement

  (C)   Authorization. The execution, delivery, and performance of this Transfer
Agreement has been duly authorized by all requisite limited company and
corporate actions, as the case may be, on the part of Novolyte HK and Parent.

  (D)   Binding Effect. This Transfer Agreement is a valid, binding, and legal
obligation of each of Novolyte HK and Parent.

  (E)   No Default. Neither the execution and delivery of this Transfer
Agreement nor Novolyte HK’s and Parent’s full performance of its obligations
under this Transfer Agreement will violate or breach, or otherwise constitute or
give rise to a Default under, the terms or provisions of Novolyte HK’s or
Parent’s constitutive documents or of any material contract, commitment, or
other obligation to which Novolyte HK or Parent is a party.

  (F)   Finders. Neither Novolyte HK nor Parent has engaged and is not directly
or indirectly obligated to any person acting as a broker, finder, or similar
capacity in connection with the transactions contemplated by this Transfer
Agreement.

Article VII

Termination

7.1.   Termination. The parties may terminate this Transfer Agreement at any
time before the Suzhou Equity Closing, but only by written instrument signed by
both parties. This Transfer Agreement will terminate automatically, and without
further action by either party (a) if the Suzhou Equity Closing has not occurred
by June 30, 2009 date, provided however, that if the Approval Authority has
already approved the transfer but Novolyte HK has not yet received the New
Business License, this Transfer Agreement may not be terminated notwithstanding
that the Suzhou Equity Closing has not occurred by such date, or (b) if either
party has terminated the Escrow Agreement dated of even date herewith between
the parties pursuant to its terms. Neither party shall have any liability to the
other upon termination hereof or have any continuing obligations to the other,
except for any that are expressly stated to survive termination.

Article VIII

Miscellaneous

8.1.   Cooperation. Novolyte HK and Ferro will cooperate with each other, at the
other party’s request and expense, in furnishing information, testimony, and
other assistance in connection with any actions, proceedings, arrangements, and
disputes with other persons or governmental inquiries or investigations
involving Ferro’s conduct of the Fine Chemicals Business or the transactions
contemplated by this Transfer Agreement.

8.2.   Severability. If any provision of this Transfer Agreement shall finally
be determined to be unlawful, then such provision will be deemed to be severed
from this Transfer Agreement and replaced by a lawful provision which carries
out, as closely as possible, the intention of the parties and preserves the
economic bargain contemplated by this Transfer Agreement and, in such case, each
and every other provision of this Transfer Agreement will remain in full force
and effect.

8.3.   Costs and Expenses. The parties will be responsible for the following
costs and expenses arising out of the transactions contemplated by this Transfer
Agreement as follows:

  (A)   Ferro will be solely responsible for the fees and expenses of KeyBanc
Capital Markets whether or not the transactions are consummated; and

  (B)   If the transactions are consummated, Ferro will be solely responsible
for all Actual Taxes as described in Article II hereof.

Otherwise, each party will bear its own expenses incurred in connection with
this Transfer Agreement and the transactions contemplated by this Transfer
Agreement, whether or not the transactions are consummated.

8.4.   Notices. All notices, requests and other communications under this
Transfer Agreement shall be in writing and shall be deemed to have been duly
given at the time of receipt if delivered by hand or communicated by electronic
transmission, or, if mailed, three days after mailing with an international
overnight courier:

         
If to Novolyte HK or Parent, to:
       
 
  Novolyte Technologies Limited/Novolyte Technologies LP
c/o Arsenal Capital Management LP 320 Park Avenue, 30th Floor New York, NY 10022
  USA
Attention: John Televantos Telefax:
    1.212.771.1718   With a copy (which shall not constitute notice to Parent or
Novolyte HK) to:

 
  Proskauer Rose LLP
1585 Broadway New York, NY 10036
  USA
Attention: Daniel J. Eisner Telefax:
    1.212.969.2900  
If to Ferro, to:
  Ferro Corporation
1000 Lakeside Avenue Cleveland, Ohio 44114 USA Attention:
  General Counsel
Telefax:
    1.216.875.7275  

Either party may change its notice address above to a different address by
giving the other party written notice of such change.

8.5.   Assignment. This Transfer Agreement will be binding upon and inure to the
benefit of the successors of the parties, but will not be assignable by any
party without the prior written consent of the other parties. Novolyte HK will
have the right, however, if it so elects, to assign all or an identified portion
of its rights and delegate all or an identified portion of its duties under this
Transfer Agreement to an Affiliate of Novolyte HK or of Parent, if, at the time
of such assignment and delegation, (i) Novolyte HK provides Ferro with an
unconditional guarantee mutually agreed upon by Novolyte HK and Ferro, and
(ii) this Transfer Agreement has not been submitted to the Approval Authority
and such assignment will not affect or require a change of any term or content
or effect of the documents already signed or delivered in connection with the
completion of the Suzhou Equity Transfer or the issuance of the New Business
License. Ferro hereby agrees that Novolyte HK may unilaterally grant a security
interest in its rights and interests hereunder to its or its Affiliates’
lender(s), and Ferro will sign a consent with respect thereto if so requested by
Novolyte HK or its Affiliates’ lender(s).

8.6.   No Third Parties. Neither this Transfer Agreement nor any provisions set
forth in this Transfer Agreement is intended to, or shall, create any rights in
or confer any benefits upon any person other than the parties to this Transfer
Agreement.

8.7.   Incorporation by Reference. The Appendices and Schedules to this Transfer
Agreement constitute integral parts of this Transfer Agreement and are hereby
incorporated into this Transfer Agreement by this reference.

8.8.   Governing Law. This Transfer Agreement will be governed by and construed
in accordance with the internal substantive laws of the P.R.C.

8.9.   Language. This Transfer Agreement is written in both English and Chinese.
The English and Chinese versions of this Transfer Agreement shall have equal
force and effect.

8.10.   Counterparts. At least six counterparts of this Transfer Agreement shall
be executed by the parties hereto in both English and Chinese, and each fully
executed counterpart shall be deemed an original without production of the
others. Each party shall hold one counterpart of each language version, and
Ferro Suzhou shall hold four counterparts for submission to the Approval
Authority for approval of the contemplated Suzhou Equity Transfer.

8.11.   Dispute Resolution/Arbitration. If the parties ever have a dispute
involving their respective rights and obligations under this Transfer Agreement,
then the parties will resolve such dispute as follows:

  (A)   Dispute Notice. Either Novolyte HK or Ferro may at any time deliver to
the other a written dispute notice setting forth a brief description of the
issues for which such notice initiates the dispute resolution mechanism set
forth in this Section 8.11. Such dispute notice shall also specify the provision
or provisions of this Transfer Agreement and the facts or circumstances that are
the subject matter of the dispute.

  (B)   Informal Negotiations. During the 30-day period following delivery of a
dispute notice described in Section 8.11, the parties will cause their
representatives to meet and seek to resolve the disputed items cordially through
informal negotiations

  (C)   Dispute Resolution Proceedings. If representatives of the parties are
unable to resolve disputed items through the informal negotiations described in
this Section 8.11, then within 15 days after the informal negotiation period the
parties will refer the disputed issues to a dispute resolution panel for final
resolution as follows:

(1) Designation of Representatives. Within seven (7) days after such informal
negotiation period, Novolyte HK and Ferro will each designate one representative
to serve on the dispute resolution panel. (If either party fails or refuses to
designate a representative, then the other party will be entitled to have a
representative appointed for such party by the CPR Institute.)

(2) Selection of Neutral. Promptly after they have been designated, the
designated representatives will meet and select a neutral person (the “Neutral”)
to serve as the third member of the dispute resolution panel. If the designated
representatives of parties cannot agree on a Neutral, then either representative
may request the CPR Institute to select the Neutral.

(3) Procedures and Process. At the time the matter is referred to the dispute
resolution panel, Novolyte HK and Ferro will jointly establish the procedures to
be followed with respect to the presentation of the parties’ respective
positions and the process by which the dispute resolution panel will reach and
render its decision on the disputed issues. Such procedures and processes will,
at a minimum, assure that –

(a) Each party will have the right to submit evidence to the dispute resolution
panel;

(b) Each party will have the right to present a written statement concerning
that party’s position with respect to the disputed item; and

(c) Before reaching a decision concerning the disputed item, the dispute
resolution panel will convene a hearing at which both parties may be
represented.

If Novolyte HK and Ferro cannot agree on such procedures and processes, then the
Neutral will establish such procedures and process which will, in all events, be
consistent with the foregoing.

(4) Decision. The dispute resolution panel will act by majority vote. The
dispute resolution panel will base its decision on applicable provisions of this
Transfer Agreement or, if the provisions of this Transfer Agreement do not
resolve the matter, on general principles of substantive P.R.C. law. (The
dispute resolution panel may, if it so desires, seek the opinion of an attorney
licensed to practice law in the P.R.C. on any matter of substantive P.R.C. law
on which the panel desires clarification.) If the dispute resolution panel
concludes that one party did not proceed in good faith in connection with the
prosecution or defense of a disputed claim, then the panel will have the power,
if it so chooses, to award the other party its costs and expenses in connection
with the dispute resolution proceedings; otherwise, each party will be solely
responsible for its own costs and one-half of the dispute resolution panel’s
fees and costs in connection with such proceedings.

  (D)   Equitable Relief. Notwithstanding any other provision of this
Section 8.11, either party may seek from a court of competent jurisdiction
interim injunctive relief in order to maintain the status quo or protect such
party’s rights under this Transfer Agreement pending resolution of a dispute
pursuant to this Section 8.11.

  (E)   Binding Effect. The decisions of the dispute resolution panel under this
Section 8.11 will be binding on both Ferro and Novolyte HK and Parent and will
be neither appealable, contestable, or subject to collateral attack by Ferro or
Novolyte HK or Parent.

1

To evidence their agreement as stated above, Novolyte Technologies Limited,
Novolyte Technologies LP and Ferro Corporation have each caused their respective
duly authorized directors, officers, or attorneys to execute this Transfer
Agreement as of the date set forth above.

     
By: Novolyte Technologies Limited
  By: Ferro Corporation
By:/s/ Anthony Giorgio
  By:/s/ Cynthia M. Kerker
 
   
Name: Anthony Giorgio
Title: Director
Nationality:
  Name: Cynthia M. Kerker
Title: Authorized Representative
Nationality: United States Citizen
By: Novolyte Technologies LP
By: Novolyte Technologies GP LLC,
its general Partner
By: /s/ Anthony Giorgio
 

 
 

Name: Anthony Giorgio
Title: Vice President
Nationality:
 

2

Appendix A

The following terms identified with initial capital letters are defined in the
following Sections of the Transfer Agreement:

      Term   Cross Reference
Actual Taxes
  Section 2.1
Amended Articles
  Section 3.3(B)
Application Letter
  Section 3.2(B)
Approval Authority
  Section 4.1
Cash Amount
  Section 2.1
Estimated EI Taxes
  Section 2.2
Estimated Taxes
  Section 2.1
Novolyte HK
  Preamble
Escrow Agent
  Section 2.1
Escrow Agreement
  Section 2.1
Ferro
  Preamble
Ferro Suzhou
  Recital A
Fine Chemicals Business
  Recital B
Neutral
  Section 8.11
New Business License
  Section 4.1
Parent
  Preamble
P.R.C.
  Recital A
Purchase Price
  Section 2.1
SAIC
  Section 4.1
Suzhou Equity Closing
  Section 5.1
Suzhou Equity Closing Date
  Section 5.1
Suzhou Equity Interest
  Recital A
Suzhou Equity Transfer
  Section 1.2
Suzhou Equity Transfer Application
  Section 3.2(B)
Transfer Agreement
  Preamble

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In addition, the following terms have the meanings set forth below where used in
the Transfer Agreement and identified with initial capital letters:

     
Affiliate
  With respect to a party, any other entity
controlling, controlled by, or under common
control with such party.
Ancillary Certificates
  The organizational code certificate, tax
registration certificate, foreign exchange
registration certificate, customs registration
certificate and other establishment related
certificates that Ferro Suzhou needs to obtain
under P.R.C. laws and regulations after getting
its new Business Licence duly reflecting the
Split-off Transaction.
CPR Institute
  CPR Institute for Dispute Resolution, 366 Madison
Avenue, New York, New York.
Default
  An occurrence which constitutes a breach or
default under a contract, order, or other
commitment, after the expiration of any grace
period provided without cure.
Encumbrance
  Any encumbrance or lien, including, without
limitation, any mortgage, judgment lien,
materialman’s lien, mechanic’s lien, security
interest, encroachment, easement, or other
restriction.
Governmental Entit(y) (ies)
  Any court of competent jurisdiction, governmental
agency, authority, instrumentality or regulatory
body.
Owns or Ownership
  Such ownership as confers upon the party or
person having it good and marketable title to and
control over the thing or right owned, free and
clear of any and all Encumbrances.
Split-Off Transaction
  The transaction to divide the assets and
liabilities of the Fine Chemicals Business from
the assets and liabilities of Ferro’s businesses
in the P.R.C. which are not related to the Fine
Chemicals Business, which Split-Off Transaction
shall be deemed effective upon the issuance of
the New Business Licence of Ferro Suzhou by SIP
AIC.

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