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

SECOND AMENDMENT TO
EMPLOYMENT AGREEMENT

This Second Amendment to Employment Agreement (“First Amendment”) is entered
into by and between ICO, Inc. (“Company”) and A. John Knapp, Jr. (“Employee”),
on January 23, 2008.
 
WHEREAS, Employee entered into an Employment Agreement with Company, effective
October 1, 2005, and amended effective August 30, 2006 (as amended, the
“Employment Agreement”), and Employee and Company desire to further amend the
Employment Agreement as set forth herein.
 
NOW, THEREFORE, for and in consideration of the mutual promises, covenants, and
obligations contained herein, Company and Employee agree as follows:
 

1.            All capitalized terms used herein and not otherwise defined herein
shall have the meaning ascribed to such terms in the Employment Agreement.
Except as amended hereby, all provisions in the Employment Agreement remain in
full force and effect.

2.            The following provision is hereby inserted in Article 2 of the
Agreement, as Section 2.7(d):

The Incentive Bonus for FY 2008 (“the “FY 2008 Annual Incentive Bonus”), shall
be calculated as follows:

The sum of the Annual Incentive Bonuses paid to the Company’s other five ELT
members based on FY 2008 performance, in accordance with their respective FY
2008 Annual Incentive Bonus Plans

divided by:

The sum of the FY 2008 Base Salaries of Company’s other five ELT members

multiplied by:

Mr. Knapp’s FY 2008 annual Base Salary ($250,000)
 
For the purpose of the above formula, the other five ELT members are (1) Donald
Eric Parsons, President – ICO Polymers North American; (2) Stephen E. Barkmann,
President – Bayshore Industrial; (3) Derek R. Bristow – President, ICO Europe;
(4) Dario E. Masutti, President – ICO Asia Pacific; (5) Bradley T. Leuschner –
Chief Financial Officer.

 
 
Page 1 of 2

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

 

3.            Effective October 1, 2007, Employee’s Base Salary (as defined in
Section 2.1 of the Agreement) is increased to Two Hundred and Fifty Thousand
Dollars ($250,000) per annum.

IN WITNESS WHEREOF, Company and Employee have duly executed this Agreement in
multiple originals to be effective on the Effective Date.

 
ICO, Inc.
             
/s/ Gregory T. Barmore
 
Gregory T. Barmore
 
Chairman of the Board of Directors
       
Date:
January 23, 2008
                   
Employee
             
/s/ A. John Knapp, Jr.
 
A. John Knapp, Jr.
     
Date:
January 23, 2008
   

 
Page 2 of 2