EX-10.51






Exhibit 10.51




Libbey Inc.




2009 DIRECTOR DEFERRED COMPENSATION PLAN




PLAN DOCUMENT














 








TABLE OF CONTENTS




	 	 	 	 	 	 	 
	ARTICLE	 	DESCRIPTION	 	 	 	 

	ARTICLE 1

	 	NAME AND PURPOSE
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE 2

	 	DEFINITIONS
	 	 	1	 
	 
	 	 	 	 	 	 
	ARTICLE 3

	 	ELIGIBILITY AND PARTICIPATION
	 	 	4	 
	 
	 	 	 	 	 	 
	ARTICLE 4

	 	DEFERRAL ACCOUNT
	 	 	4	 
	 
	 	 	 	 	 	 
	ARTICLE 5

	 	VESTING
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE 6

	 	DISTRIBUTION ELECTIONS
	 	 	7	 
	 
	 	 	 	 	 	 
	ARTICLE 7

	 	BENEFIT PAYMENT EVENTS
	 	 	8	 
	 
	 	 	 	 	 	 
	ARTICLE 8

	 	BENEFICIARIES
	 	 	10	 
	 
	 	 	 	 	 	 
	ARTICLE 9

	 	RIGHTS OF PARTICIPANTS AND BENEFICIARIES
	 	 	10	 
	 
	 	 	 	 	 	 
	ARTICLE 10

	 	TRUST
	 	 	10	 
	 
	 	 	 	 	 	 
	ARTICLE 11

	 	CLAIMS PROCEDURE
	 	 	11	 
	 
	 	 	 	 	 	 
	ARTICLE 12

	 	ADMINISTRATION
	 	 	13	 
	 
	 	 	 	 	 	 
	ARTICLE 13

	 	AMENDMENT AND TERMINATION
	 	 	14	 
	 
	 	 	 	 	 	 
	ARTICLE 14

	 	MISCELLANEOUS
	 	 	15	 
















 






Libbey Inc.




2009 DIRECTOR DEFERRED COMPENSATION PLAN




     The Libbey Inc. 2009 Director Deferred Compensation Plan (the “Plan”) is hereby adopted by
Libbey Inc., a corporation organized and existing under and by virtue of the laws of the State of
Delaware (the “Company”):



WITNESSETH:




     WHEREAS, the Company, in order to reward the Outside Directors (as defined below) of the
Company, desires to provide the Outside Directors with the opportunity to defer compensation on a
pre-tax basis through the Plan.



     NOW, THEREFORE, the Company hereby adopts the Plan, effective January 1, 2009, as more
particularly described below:



ARTICLE 1




NAME AND PURPOSE





	1.1.	 	Name. The name of the Plan shall be the Libbey Inc. 2009 Director Deferred Compensation Plan.
	 
	1.2.	 	Purpose. The purpose of the Plan is to reward the Outside Directors of the Company, as they
have contributed to the Company’s success and are expected to contribute to the Company’s
success in the future.
	 
	1.3.	 	Not a Funded Plan. It is the intention and purpose of the Company that the Plan shall be
deemed to be “unfunded” for tax purposes. The Plan shall be administered in such a manner,
notwithstanding any contrary provision of the Plan, in order that it will be so deemed and
would be so described.





ARTICLE 2




DEFINITIONS




          Unless the context otherwise indicates, the following words have the following meanings
wherever used in this plan document:





	2.1.	 	Administrator. “Administrator” means such person or entity as is designated by the Board, and
in absence of such designation, the Chief Executive Officer of the Company.
	 
	2.2.	 	Appeals Committee. “Appeals Committee” means the Nominating and Governance Committee of the
Board or such other committee of the Board as has a similar function and is designated by the
Board as the Appeals Committee.
	 
	2.3.	 	Beneficiary. “Beneficiary” means any person who receives, or is designated to receive,
payment of any benefit under the terms of the Plan because of the participation of an Outside
Director in the Plan.





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	2.4.	 	Benefit Commencement Date. “Benefit Commencement Date” means the first date as of which
benefits are to be paid pursuant to the terms of the Plan.
	 
	2.5.	 	Benefit Payment. “Benefit Payment” means payment of the benefit as set forth in Article 6 or
Article 7, as applicable.
	 
	2.6.	 	Board. “Board” means the board of directors of the Company.
	 
	2.7.	 	Change in Control. “Change in Control” means a “Change in Ownership,” “Change in Effective
Control” or a “Change of Ownership of a Substantial Portion of Assets,” as defined in Code
Section 409A and the regulations issued thereunder and summarized herein (“§409A”). A “Change
in Ownership” occurs on the date that any one person or more than one person acting as a group
(as defined in §409A) acquires ownership of Company stock in an amount that, when taken
together with stock held by that person or group, constitutes more than 50% of the total fair
market value or total voting power of the Company’s stock. A “Change in Effective Control”
occurs on the date that either (a) any one person or more than one person acting as a group
acquires (or has acquired during the period of twelve (12) consecutive months ending on the
date of the most recent acquisition by such person or persons) ownership of Company stock
possessing 30% or more of the total voting power of the Company’s stock; or (b) a majority of
members of the Board is replaced during any period of twelve (12) consecutive months by
directors whose appointment or election is not endorsed by a majority of the members of the
Board prior to the date of the appointment or election. A “Change of Ownership of a
Substantial Portion of Assets” occurs on the date that any one person or more than one person
acting as a group acquires (or has acquired during a period of twelve (12) consecutive months
ending on the date of the most recent acquisition by that person or persons) assets from the
Company that have a total gross fair market value equal to or more than 40% of the total gross
fair market value of all of the Company’s assets immediately prior to the acquisition or
acquisitions.
	 
	2.8.	 	Code. “Code” means the Internal Revenue Code of 1986 and any regulations or other
pronouncements promulgated thereunder. Whenever a reference is made in this plan document to a
specific Code section, that reference shall be deemed to include any successor Code section
having the same or a similar purpose.
	 
	2.9.	 	Company. “Company” means Libbey Inc. and any successor company or business organization that
assumes the duties and obligations of Libbey Inc. under the Plan.
	 
	2.10.	 	Deferral Amount. “Deferral Amount” means, for each Participant, Fees that in the absence of
a Deferral Election would be payable to the Participant on a Deferral Date and that the
Participant has elected to defer pursuant to a Deferral Election.
	 
	2.11.	 	Deferral Date. “Deferral Date” means the date on which the Fees that are subject to a
Deferral Election would have been paid in the absence of the Deferral Election.
	 
	2.12.	 	Deferral Election. “Deferral Election” means an election made by a Participant pursuant to
Article 4 of this Plan.
	 
	2.13.	 	Director. “Director” means a member of the Board of the Company.




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	2.14.	 	Disability. A Participant shall be considered to have a “Disability” if 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 twelve (12) months.
	 
	2.15.	 	Effective Date. “Effective Date” means January 1, 2009, the date on which the Plan becomes
effective.
	 
	2.16.	 	Equity Compensation. “Equity Compensation” means shares of the Company’s common stock.
	 
	2.17.	 	Fees. “Fees” means cash and/or Equity Compensation (whether paid as retainers, meeting fees,
fees for special service or otherwise) received by a Director of the Company for services
rendered as a member of the Company’s Board.
	 
	2.18.	 	Measurement Funds. “Measurement Funds” means the hypothetical investments in which the
Participant’s Deferral Account may be deemed to be invested; the particular Measurement Funds
into which the Participant has elected to defer his or her fees will be used to value his or
her Deferral Account.
	 
	2.19.	 	Outside Director. “Outside Director” means a member of the Board who is not an employee of
the Company.
	 
	2.20.	 	Participant. “Participant” means any eligible Outside Director who is designated by the
Board as eligible to participate in the Plan.
	 
	2.21.	 	Participant Access System. “Participant Access System” means the online administration
system that provides Participants with the ability to make various elections with respect to
their Plan participation and with continual access to important Plan information.
	 
	2.22.	 	Plan. “Plan” means the Libbey Inc. 2009 Director Deferred Compensation Plan, as it may be
later amended.
	 
	2.23.	 	Plan Year. “Plan Year” means a period of twelve (12) consecutive months ending on December
31 in each calendar year.
	 
	2.24.	 	Separation from Service: “Separation from Service” means the date on which the Director
incurs a “separation from service” within the meaning of the Code.
	 
	2.25.	 	Unforeseeable Emergency. “Unforeseeable Emergency” means a severe financial hardship to the
Participant resulting from (a) an illness or accident of the Participant, the Participant’s
spouse, the Participant’s Beneficiary or a dependent of the Participant, (b) loss of the
Participant’s property due to casualty (including the need to rebuild a home following damage
to a home not otherwise covered by insurance), or (c) other similar extraordinary and
unforeseeable circumstances arising as a result of events beyond the control of the
Participant. Amounts distributed upon the occurrence of an Unforeseeable Emergency may not
exceed the amounts necessary to satisfy the emergency plus amounts necessary to pay taxes
reasonably anticipated as a result of the payment, after taking into account the extent to
which the hardship is or may be relieved through reimbursement or compensation by insurance or
otherwise or by liquidation of the




3









 






	 	 	Participant’s assets (to the extent the liquidation of
assets would not itself cause severe financial hardship) or by cessation of deferrals under
the Plan.





ARTICLE 3




ELIGIBILITY AND PARTICIPATION





	3.1.	 	Eligibility. Each Outside Director is eligible to participate in the Plan effective on the
later to occur of (a) the Effective Date of the Plan or (b) the date on which the Outside
Director is first elected to the Board as an Outside Director.
	 
	3.2.	 	Participation. Each Outside Director shall become a Participant on or as of the date on which
the Outside Director is eligible to participate in the Plan. The Outside Director shall remain
a Participant until the earlier of (a) the date of his or her Separation from Service, or (b)
the cessation of eligible status pursuant to Section 3.3.
	 
	3.3.	 	Cessation of Participation Initiated by the Board. If the Board determines, in its sole
discretion, that a Participant is not, or may not be, an active Outside Director of the
Company, then the Board may, in its sole discretion, terminate the Participant’s participation
in the Plan effective with the Plan Year commencing after the Plan Year in which the Board
makes that determination. In the event of termination of participation:






	 	(a)	 	The Participant shall no longer have additional amounts credited to his or her
Deferral Account; and
	 
	 	(b)	 	With respect to a Participant whose Plan participation is terminated on or
after the Effective Date, no Benefit Payments shall be made to the Participant other
than pursuant to Article 6 and Article 7.





ARTICLE 4




DEFERRAL ACCOUNT





	4.1.	 	Deferral Elections. A Participant may make, in accordance with Sections 4.2 through 4.5
below, certain elections with respect to the deferral of Fees. If a Participant properly makes
a Deferral Election under the Plan for a Plan Year, then the Company shall retain a portion of
the Fees that otherwise would be paid to the Participant by the Company and shall credit that
portion of the Participant’s Fees to the Participant’s Deferral Account pursuant to Section
4.8.
	 
	4.2.	 	Fee Deferral. With respect to each Plan Year, a Participant may elect to defer a portion of
Fees by making a Deferral Election via the Participant Access System or in writing, as
required by the Administrator. A Participant’s Deferral Election shall specify a stated
percentage or dollar amount of the Participant’s Fees that shall not exceed one hundred
percent (100%) of the Participant’s Fees. The amount so elected under the Deferral Election
shall be credited to the Participant’s Deferral Account.
	 
	4.3.	 	General Deferral Election Rules. A Participant’s Deferral Election as to Fees shall be
irrevocable during the Plan Year for which it is made.




4









 






	4.4.	 	Specific Deferral Election Rules. The following rules govern all Participant Deferral
Elections under the Plan:






	 	(a)	 	A Participant must complete a Deferral Election as to Fees prior to the first
day of the Plan Year for which the Fees may be earned, or such earlier deadline as the
Administrator, in its sole discretion, may establish. No Deferral Election shall be
effective with respect to Fees earned before the first day of the Plan Year commencing
after the date on which the applicable Deferral Election is submitted to the
Administrator.
	 
	 	(b)	 	If a Participant first becomes eligible to participate in the Plan after the
first day of any Plan Year, the Participant must, in order to participate for the Plan
Year, complete, either in writing or via the Participant Access System, a Deferral
Election within thirty (30) days after he or she first becomes eligible to participate
in the Plan, or within such other earlier deadline as the Administrator, in its sole
discretion, may establish. The Deferral Election shall apply to Fees for services
rendered after the date of election. The Deferral Election shall become irrevocable
upon the end of the thirty (30) day period. The determination of whether a Participant
may file a distribution election under this paragraph shall be determined in accordance
with the rules of Code Section 409A, including the provisions of Treasury Regulation
Section 1.409A-2(a)(7).
	 
	 	(c)	 	The Administrator shall process each Participant’s Deferral Election as soon as
administratively practicable after the Deferral Election is submitted and accepted by
the Administrator.
	 
	 	(d)	 	No Deferral Election shall be effective with respect to Fees paid before the
satisfactory completion of the requirements described in this Section 4.4 and any other
requirements the Administrator determines are necessary.
	 
	 	(e)	 	A Participant’s Deferral Election under this Plan shall be terminated to the
extent the Administrator determines, in its sole discretion, that the termination of
the Participant’s Deferral Election is required due to an Unforeseeable Emergency. If
the Administrator, in its sole discretion, determines that a termination of the
Participant’s deferral is required due to an Unforeseeable Emergency, the Participant’s
deferrals shall be terminated as soon as administratively practicable following the
date on which the determination is made.






	4.5.	 	“Evergreen” Election. A Deferral Election made in one calendar year with respect to Fees
payable for service rendered in the succeeding calendar year shall be deemed renewed
automatically with respect to Fees payable for service rendered in each subsequent calendar
year during which the Participant renders service to the Company as an Outside Director.
However:






	 	(a)	 	Each renewal of the Deferral Election according to this Section 4.5 shall be
deemed a separate Deferral Election, the terms of which are identical to the original
Deferral Election;
	 
	 	(b)	 	In lieu of automatically renewing a Deferral Election, the Participant may make
a separate written Deferral Election, pursuant to Sections 4.2 through 4.4 above,




5









 






	 	 	 	with
respect to Fees payable for service rendered in the subsequent calendar year.






	4.6.	 	Establishment of Deferral Accounts. The Administrator or designated representative shall
establish a Deferral Account (or multiple Deferral Accounts, which shall be referred to in
this Plan in the aggregate as “Deferral Account”) in the name of each Participant on its books
and records. All amounts credited to the Deferral Account of any Participant or Beneficiary
shall constitute a general, unsecured liability of the Company.
	 
	4.7.	 	Crediting of Deferral Amounts. Amounts shall be credited to the Participant’s Deferral
Account as of the date on which the Fees otherwise would have been paid to the Participant
absent the Deferral Election.
	 
	4.8.	 	Adjustment of Deferral Account. The Deferral Account shall be adjusted for earnings
(including, in the case of phantom stock of the Company, dividend equivalents), gains and
losses as if the Deferral Account held actual assets and the assets were invested in
Measurement Funds in accordance with Section 4.9. The value of each Participant’s Deferral
Account shall be determinable on a daily basis in accordance with, and in the order of, the
following:






	 	(a)	 	Beginning Balance. The balance at the beginning of the day, which equals the
Ending Balance (as described below) as of the end of the most recent business day.
	 
	 	(b)	 	Sub-Ending Balance. The Beginning Balance, plus applicable Deferral Amounts,
less any Benefit Payments and forfeitures, in each case that are made on or occur as of
that date.
	 
	 	(c)	 	Investment Earnings. Investment earnings (including, in the case of phantom
stock of the Company, dividend equivalents), gains and losses determined pursuant to
this Section will be credited to each Participant’s Deferral Account as of each
business day.
	 
	 	(d)	 	Ending Balance. The Sub-Ending Balance plus Investment Earnings.






	4.9.	 	Measurement Funds. The Company shall designate Measurement Funds for the valuation of each
Participant’s Deferral Account as if the Deferral Account held actual assets. The Measurement
Funds shall include a phantom stock fund deemed invested in the Company’s common stock and may
include, among other types of funds, the following types of funds as determined by the
Company:






	 	(a)	 	mutual funds, including without limitation, equity funds, money market funds,
fixed income funds and balanced funds,
	 
	 	(b)	 	any insurance company’s general account, or
	 
	 	(c)	 	any special account established and maintained by any insurance company.






The Company shall have the sole discretion to determine the number and nature of Measurement
funds to be designated and may change or eliminate the Measurement Funds from time to time.



6









 






	4.10.	 	Investment Allocations. Participants shall direct the allocation of their Deferral Account
among the Measurement Funds designated by the Company as though the Deferral Account held
actual assets. Any such directions of investment shall be subject to such rules as the Company
and Administrator may prescribe, including, but not limited to, rules concerning the manner of
providing investment directions and the frequency of changing investment directions. If a
Participant does not direct the investment of any portion of a Participant’s Deferral Account,
the undirected portion shall be deemed to be invested in the money market Measurement Fund.
However, deferrals of Equity Compensation will be deemed to be allocated to the Libbey Inc.
common stock Measurement Fund.





ARTICLE 5




VESTING





	5.1.	 	Vesting of Deferral Account. A Participant shall always be one hundred percent (100%) vested
in his or her Deferral Account.





ARTICLE 6




DISTRIBUTION ELECTIONS





	6.1.	 	Distribution Elections, Generally. A Participant shall make a distribution election during
the period established and in the manner specified by the Administrator, but in any event in
accordance with Section 6.2. An election that is not timely shall be considered void and
shall have no effect. The Administrator may modify the method by which an election may be
made prior to the date the election becomes irrevocable under the rules of Section 6.2.
	 
	6.2.	 	Timing Requirements for Elections.






	 	(a)	 	Generally. A Participant may make a distribution election no later than
December 31 of the year prior to the year in which Fees subject to the election are
earned or such earlier time as the Administrator may designate in its sole discretion.
Once made, an election shall become irrevocable effective as of the first day of the
Plan Year to which the election relates.
	 
	 	(b)	 	Newly Eligible Participant. In case of the first year in which an Outside
Director becomes eligible to participate in the Plan, he or she may make an initial
distribution election by submitting an election within thirty (30) days after the date
the Outside Director becomes eligible to participate in the Plan or such earlier time
as the Administrator may designate, with respect to a deferral for services to be
performed after the election. The election shall become irrevocable upon the end of
the thirty (30) day period. The determination of whether a Participant may file a
distribution election under this paragraph shall be made in accordance with the rules
of Code Section 409A, including the provisions of Treasury Regulation Section
1.409A-2(a)(7).






	6.3.	 	Subsequent Election Changes. A Participant may make a subsequent election to change the
timing or form of Benefit Payments for amounts that are subject to an




7









 






	 	 	irrevocable distribution
election by appropriate notice submitted to the Administrator. Any such modified election
must adhere to the following requirements:






	 	(a)	 	The election may not take effect until at least twelve (12) months after the
date on which the election is made;
	 
	 	(b)	 	The first Benefit Payment (other than due to death, Disability or Unforeseeable
Emergency) with respect to the election must be deferred for a period of not less than
five (5) years from the date on which the Benefit Payment would otherwise have been
made; and
	 
	 	(c)	 	The election may not be made less than twelve (12) months prior to any specific
or fixed Benefit Payment date required by the prior election.






The election that the Administrator most recently has accepted and that has become effective
shall govern the payout of any benefit.



ARTICLE 7




BENEFIT PAYMENT EVENTS





	7.1.	 	Timing of Distribution. Except as otherwise provided in Section 7.8, distribution of a
Participant’s Deferral Account shall be made in accordance with the following:






	 	(a)	 	The Benefit Commencement Date elected by a Participant under Section 7.2 with
respect to an In-Service Payout;
	 
	 	(b)	 	The date set forth in Section 7.4 with respect to a Participant’s Separation
from Service;
	 
	 	(c)	 	The date set forth in Section 7.5 with respect to a Participant’s death;
	 
	 	(d)	 	The date set forth in Section 7.6 with respect to the Participant’s Disability;
or
	 
	 	(e)	 	The date set forth in Section 7.7 with respect to a Change in Control.






	7.2.	 	In-Service Payout. A Participant may irrevocably elect, in his or her election, to receive a
specified percentage, or dollar amount, of his or her Deferral Account as of a specific
Benefit Commencement Date, which may be any date prior to Separation from Service. The
distribution shall be paid or begin to be paid as soon as administratively feasible following
the specified Benefit Commencement Date but not later than thirty (30) days following the
specified date. Any remaining Deferral Account balance shall be distributed upon the earliest
to occur of the events described in Sections 7.4, 7.5, 7.6, or 7.7.
	 
	7.3.	 	Intentionally Omitted.
	 
	7.4.	 	Separation from Service. Upon a Participant’s Separation from Service for any reason other
than death or Disability, the Participant’s Deferral Account shall be paid ina lump sum within
sixty (60) days following the date of the Separation from Service. Notwithstanding the
foregoing, if the Company has publicly-traded stock, distributions




8









 






	 	 	made to “specified
employees” (within the meaning of Section 409A of the Code and determined pursuant to policies
adopted by the Company) upon Separation from Service shall be paid or begin to be paid no
earlier than the first day of the seventh month following the separation unless the
Participant dies during the six-month period, in which case Section 7.5 shall apply.
	 
	7.5.	 	Death. Upon the Participant’s death, the Administrator shall pay to the Participant’s
Beneficiary a benefit equal to the remaining balance in the Participant’s Deferral Account.
The payment shall be made in the form of a lump sum within 60 days following the Participant’s
death.
	 
	7.6.	 	Disability. A Participant who suffers a Disability shall receive the balance in his or her
Deferral Account in a lump sum on the first day of the month following the Participant’s
Disability, regardless of whether the Participant is a specified employee.
	 
	7.7.	 	Change in Control. Notwithstanding any Plan provision to the contrary, upon a Change in
Control, a Participant’s entire Deferral Account balance (calculated as of the close of
business on the day the Change in Control is deemed to have occurred, as determined by the
Administrator in its sole discretion) shall be paid in a single lump sum.
	 
	7.8.	 	Hardship Withdrawal. If the Administrator, upon application of a Participant, determines
that the Participant has suffered an Unforeseeable Emergency, the Company shall pay to the
Participant the portion of the Participant’s Deferral Account balance necessary to satisfy the
emergency. The payment shall be made in a lump sum within 60 days after the Administrator has
approved the Participant’s request.
	 
	7.9.	 	Discretion to Accelerate Payment. Except as otherwise expressly provided, the Company shall
have the discretion to accelerate payment of a Participant’s Deferral Account to the extent
permitted pursuant to Treasury Regulation Section 1.409A-3(j)(4).
	 
	7.10.	 	Correction of Amounts Payable. Notwithstanding anything contained in this Article 7 to the
contrary, if, after a Participant’s Separation from Service, the Deferral Account balance that
would have been payable under the Plan is subject to any deduction, change, offset or
correction, then the amount payable to the Participant or Beneficiary shall be adjusted to
reflect any such deduction, change, offset or correction, to the extent permitted by Section
409A of the Code.
	 
	7.11.	 	Payment in Cash or Stock. When distributed, deferred Equity Compensation (and earnings
thereon) will be distributed in the form of shares of Libbey Inc. common stock, unless Libbey
Inc. common stock is not publicly traded at the date of distribution. In that event, deferred
Equity Compensation (and earnings thereon) will be distributed in cash. Deferred cash
compensation (and earnings thereon) will be distributed in cash even if allocated to the
Libbey Inc. common stock measurement fund.
	 
	7.12.	 	Payment Provision. If a Participant or Beneficiary is to receive or commence benefits
within a specified number of days following a specified event, the Participant or Beneficiary
will not have the right to designate the taxable year of payment.





9









 










ARTICLE 8




BENEFICIARIES





	8.1.	 	Automatic Beneficiary. Unless a Participant has designated a Beneficiary in accordance with
the provisions of Section 8.2 and the Beneficiary has survived the Participant, the
Beneficiary shall be deemed to be the Participant’s spouse or, if there is no surviving
spouse, then the Participant’s estate.
	 
	8.2.	 	Designated Beneficiary or Beneficiaries. A Participant may, using a form provided by the
Administrator, designate the Beneficiary or Beneficiaries to receive any benefit payable under
Section 7.5. Each designation shall revoke all prior designations by the Participant and shall
be effective only when filed by the Participant during his/her lifetime with the
Administrator. Any ambiguity in a Beneficiary designation shall be resolved by the
Administrator.





ARTICLE 9




RIGHTS OF PARTICIPANTS AND BENEFICIARIES





	9.1.	 	Creditor Status of Participant and Beneficiary. The Plan constitutes the unfunded, unsecured
promise of the Company to make Benefit Payments to each Participant and Beneficiary in the
future and shall be a liability solely against the general assets of the Company. The Company
shall not be required to segregate, set aside or escrow any amounts for the benefit of any
Participant or Beneficiary. Each Participant and Beneficiary shall have the status of a
general unsecured creditor of the Company and may look only to the Company and their general
assets for Benefit Payments under the Plan.
	 
	9.2.	 	Rights with Respect to Trust. Any trust and any assets held by any trust to assist the
Company in meeting in its obligations under the Plan shall in no way be deemed to contradict
the provisions of Section 9.1.
	 
	9.3.	 	Investments. In its sole discretion, the Company may acquire insurance policies, annuities or
other financial vehicles for the purpose of providing future assets of the Company to meet its
anticipated liabilities under the Plan. The policies, annuities or other investments shall at
all times be and remain unrestricted general property and assets of the Company or property of
a trust. Participants and Beneficiaries shall have no rights, other than as general creditors,
with respect to the policies, annuities or other acquired assets.





ARTICLE 10




TRUST





	10.1.	 	Establishment of Trust. Notwithstanding any other provision or interpretation of the Plan,
the Company may establish a trust in which to hold cash, insurance policies or other assets to
be used to make, or reimburse the Company for, as applicable, Benefit Payments to the
Participants or Beneficiaries. Any trust assets shall at all times remain subject to the
claims of general creditors of the Company in the event of their insolvency as more fully
described in the trust.





10









 





	10.2.	 	Obligations of the Company. Notwithstanding the fact that a trust may be established under
Section 10.1, the Company shall remain liable for paying the benefits under the Plan. However,
any Benefit Payments to a Participant or a Beneficiary made by the trust shall satisfy the
Company’s obligation to make the Benefit Payments to that person.
	 
	10.3.	 	Trust Terms. A trust established under Section 10.1 may be revocable by the Company.
However, the trust may become irrevocable in accordance with its terms in the event of a
Change in Control. The trust may contain such other terms and conditions as the Company may
determine to be necessary or desirable. The Company may terminate or amend a trust established
under Section 10.1 at any time and in any manner it deems necessary or desirable, subject to
the second sentence of this Section 10.3 and the terms of any agreement under which any such
trust is established or maintained.





ARTICLE 11




CLAIMS PROCEDURE





	11.1.	 	Claim for Benefits. Any claim for benefits under the Plan shall be made in writing to the
Administrator in the manner reasonably prescribed by the Administrator. The Administrator
shall process each claim and determine entitlement benefits within thirty (30) days following
the receipt of a completed application for benefits, unless special circumstances require an
extension of time for processing the claim. If an extension of time for processing is
required, written notice of the extension shall be furnished to the claimant prior to the
termination of the initial thirty (30) day period. In no event shall the extension exceed a
period of thirty (30) days from the end of the initial period. The extension notice shall
indicate the special circumstances requiring an extension of time and the date as of which the
Administrator expects to render the final decision.
	 
	11.2.	 	Denial of a Claim. If a claim is wholly or partially denied by the Administrator, the
Administrator shall notify the claimant of the denial of the claim in writing delivered in
person or mailed by first class mail to the claimant’s last known address. The notice of
denial shall 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 the Plan’s claim review procedure.






If no notice of denial is provided, and if the claim has not been granted within the time
specified above for approval of the claim, the claim shall be deemed denied and subject to
review as described below. The interpretations, determinations and decisions of the
Administrator shall 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 11.




	11.3.	 	Request for Review of a Denial of a Claim for Benefits. Any claimant or authorized
representative of the claimant whose claim for benefits under the Plan has been denied 




11









 






	 	 	or
deemed denied, in whole or in part, by the Administrator may upon written notice delivered to
the Appeals Committee request a review by the Appeals Committee of the denial of Participant’s
claim for benefits. The claimant shall have sixty (60) days from the date the claim is deemed
denied, or sixty (60) days from receipt of the notice denying the claim, as the case may be,
in which to request a review. The claimant’s notice must specify the relief requested and the
reason the claimant believes the denial should be reversed.
	 
	11.4.	 	Appeals Procedure. The Appeals Committee is hereby authorized to review the facts and
relevant documents, including the Plan document, to interpret the Plan and other relevant
documents and to render a decision on the appeal of the claimant. The review may be made by
written briefs submitted by the claimant and the Administrator or at a hearing, or by both, as
shall be deemed necessary by the Appeals Committee. Upon receipt of a request for review, the
Appeals Committee shall schedule a hearing to be held (subject to reasonable scheduling
conflicts) not less than thirty (30) nor more than forty-five (45) days from the receipt of
the request. The date and time of the hearing shall be designated by the Appeals Committee
upon not less than fifteen (15) days notice to the claimant and the Administrator, unless both
the claimant and the Administrator accept shorter notice. The notice shall specify that the
claimant must indicate, in writing, and least five (5) days in advance of the time established
for the hearing, claimant’s intention to appear at the appointed time and place, or the
hearing automatically will be canceled. The reply shall specify any other persons who will
accompany the claimant to the hearing, or the other persons will not be admitted to the
hearing. The Appeals Committee shall make every effort to schedule the hearing on a day and at
a time that is convenient to both the claimant and the Administrator. The hearing will be
scheduled at the Company’s headquarters unless the Appeals Committee determines that another
location would be more appropriate. The Company shall provide the claimant, upon request and
free of charge, reasonable access to and copies of all documents, records and other
information relevant to the claimant’s claim for benefits and claimant may submit issues and
comments in writing prior to or during the hearing.
	 
	11.5.	 	Decision Upon Review of Denial of Claim for Benefits. After the review has been completed,
the Appeals Committee shall render a decision, in writing, and a copy shall be sent to both
the claimant and the Administrator. In making its decision, the Appeals Committee shall have
full power, authority and discretion to determine any and all questions of fact, resolve all
questions of interpretation of this Plan document or related documents that may arise under
any of the provisions of the Plan or the documents as to which no other provision for
determination is made under this Plan document, and exercise all other powers and discretions
necessary to be exercised under the terms of the Plan which the Appeals Committee is herein
given or for which no contrary provision is made 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
the Plan. The Appeals Committee shall render a decision on the claim review promptly, but not
more than sixty (60) days after the receipt of the claimant’s request for review, unless a
hearing is held, in which case the sixty (60) day period shall be extended to thirty (30) days
after the date of the hearing. The decision shall include specific reasons for the decision,
written in a manner calculated to be understood by the claimant, shall contain specific
references to the pertinent provisions of the Plan and related documents upon which the
decision is based, and shall state that the claimant is entitled to receive, upon request and
free of charge, reasonable access to and copies of all documents, records and other
information relevant (as defined in applicable ERISA regulations) to the claimant’s claim 




12









 







	 	 	for
benefits. The decision on review shall be furnished to the claimant within the appropriate
time described above. If the decision on review is not furnished within that time, the claim
shall be deemed denied on review at the end of that period. There shall be no further appeal
from a decision rendered by the Appeals Committee. The decision of the Appeals Committee shall
be final and binding in all respects on the Administrator, the Company and the claimant.
Except as otherwise provided by law, the review procedures of this Article 11 shall be the
claimant’s sole and exclusive remedy and shall be in lieu of all actions at law, in equity,
pursuant to arbitration or otherwise.
	 
	11.6.	 	Appeals Committee. The fact that a person is a Participant shall not disqualify them from
acting as a member of the Appeals Committee, nor shall any member of the Appeals Committee be
disqualified from acting on any question because of Participant’s interest therein, except
that no member of the Appeals Committee may act on any claim that the member has brought as a
Participant or Beneficiary under the Plan. In the case of death, resignation or removal of any
member of the Appeals Committee, the remaining members shall act until a successor-member
shall be appointed by the Board. All communications to the Appeals Committee shall be
addressed to the Secretary of the Company at the address of the Company.
	 
	11.7.	 	Operations of Appeals Committee. On all matters and questions, a decision of a majority of
the members of the Appeals Committee shall govern and control. Meetings may be held in person
or by telephonic or electronic means. In lieu of a meeting, decisions may be made by unanimous
written consent. The Appeals Committee shall appoint one of its members to act as its Chairman
and another member to act as Secretary. The terms of office of these members shall be
determined by the Appeals Committee, and either or both of the Secretary or Chairman may be
removed by the other members of the Appeals Committee for any reason that the other members
may deem just and proper. The Secretary shall do all things directed by the Appeals Committee.
Although the Appeals Committee shall act by decision of a majority of its members as above
provided, nevertheless 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 shall be deemed to have been
served or made upon the Appeals Committee.





ARTICLE 12




ADMINISTRATION





	12.1.	 	Appointment of Administrator. The Board shall appoint the Administrator, which shall be any
person(s), corporation or partnership (including the Company itself) as the Board shall deem
desirable in its sole discretion. The Administrator may be removed or resign upon thirty (30)
days written notice or such lesser period of notice as is mutually agreeable. Unless the Board
appoints another Administrator, the Company’s Chief Executive Officer shall be the
Administrator.
	 
	12.2.	 	Powers and Duties of the Administrator. The Administrator shall determine any and all
questions of fact, resolve all questions of interpretation of the Plan that may arise under
any of the provisions of the Plan as to which no other provision for determination is made
hereunder, and exercise all other powers and discretions necessary to be exercised under the
terms of the Plan that the Administrator is herein given or for which




13









 






	 	 	no contrary provision is
made. The Administrator shall have full power and discretion to interpret the Plan and related
documents, to resolve ambiguities, inconsistencies and omissions, to determine any question of
fact, and to determine the rights and benefits, if any, of any Participant, or other
applicant, in accordance with the provisions of the Plan. Subject to the provisions of any
claims procedure hereunder, the Administrator’s decision with respect to any matter shall be
final and binding on all parties concerned, and neither the Administrator nor any of its
directors, officers, employees or delegates nor, where applicable, the directors, officers or
employees of any delegate, shall be liable in that regard except for gross abuse of the
discretion given it and them under the terms of the Plan. All determinations of the
Administrator shall be made in a uniform, consistent and nondiscriminatory manner with respect
to all Participants and Beneficiaries in similar circumstances. The Administrator, from time
to time, may designate one or more person or agents to carry out any or all of its duties
hereunder.
	 
	12.3.	 	Engagement of Advisors. The Administrator may employ actuaries, attorneys, accountants,
brokers, employee benefit consultants, and other specialists to render advice concerning any
responsibility the Administrator or Appeals Committee has under the Plan. These persons may
also be advisors to the Company.
	 
	12.4.	 	Payment of Costs and Expenses. The costs and expenses incurred in the administration of the
Plan shall be paid in either of the following manners as determined by the Company in its sole
discretion:






	 	(a)	 	The expenses may be paid directly by the Company; or
	 
	 	(b)	 	The expenses may be paid out of the trust, if any (subject to any restriction
contained in the trust or required by law).






The costs and expenses include those incident to the performance of the responsibilities of
the Administrator or the Appeals Committee, including but not limited to, claims,
administration fees and costs, fees of accountants, legal counsel and other specialists,
bonding expenses, and other costs of administering the Plan. Notwithstanding the foregoing,
in no event will any person serving in the capacity of Administrator or the Appeals
Committee member be entitled to any compensation for his or her services.



ARTICLE 13




AMENDMENT AND TERMINATION





	13.1.	 	Power to Amend or Terminate. Except as otherwise provided herein following a Change in
Control, the Plan may be amended by the Board at any time, and may be terminated by the Board
at any time, but no amendment, modification or termination shall reduce the amounts credited
to the Deferral Account of any Participant, determined as of the date of the amendment,
modification or termination. The amendment or termination shall be in writing. The Plan may
not be amended (but may be terminated) during the two (2)-year period following a Change in
Control, except that amendments may be made as required by law.






	 	(a)	 	Effects of Plan Termination. If the Plan is terminated, then, on and after the
effective date of the termination, all deferrals and allocations under the Plan shall
cease and each Participant’s or Beneficiary’s Deferral Account shall be paid to




14









 






	 	 	 	him/her
as required by Article 6 and Article 7. Alternatively, each Participant’s or
Beneficiary’s Deferral Account shall be paid in a cash lump-sum provided that (i) the
termination of the Plan does not occur proximate to a downturn in the financial health
of the Company, (ii) the Board terminates all non-qualified deferred compensation
arrangements of the same type (as defined in §409A) at the same time that the Plan is
terminated; (iii) the Company makes no Benefit Payments to Participants and
Beneficiaries for twelve (12) months after the Company takes all necessary action to
terminate the Plan (except for amounts otherwise payable pursuant to Articles 6 and 7)
but makes all payments within twenty-four (24) months after the Company takes all
necessary action to terminate the Plan; and (iv) the Company adopts no new
non-qualified deferred compensation arrangement of the same type for three (3) years
after the Company takes all necessary action to terminate the Plan.






	13.2.	 	No Liability for Plan Amendment or Termination. None of the Company, any officer or any
Board member shall have any liability as a result of the amendment or termination of the Plan.
Without limiting the generality of the foregoing, the Company shall have no liability for
terminating the Plan even if a Participant may have expected to have future allocations made
on Participant’s behalf had the Plan remained in effect.





ARTICLE 14




MISCELLANEOUS





	14.1.	 	Non-Alienation. Except as provided in Section 14.2, no benefits or amounts credited to any
Deferral Account shall be subject in any manner to be anticipated, alienated, sold,
transferred, assigned, pledged, encumbered, attached, garnished or charged in any manner
(either at law or in equity), and any attempt to so anticipate, alienate, sell, transfer,
assign, pledge, encumber, attach, garnish or charge the same shall be void; nor shall any such
benefits or amounts in any manner be liable for or subject to the debts, contracts,
liabilities, engagements or torts of the person entitled to the benefits or amounts as are
herein provided to the Participant.
	 
	14.2.	 	Domestic Relations Order. If a court order is issued to the Company that is intended to
divide a Participant’s Deferral Account between the Participant and his/her spouse, the order
shall be applied by the Company if it clearly specifies the manner for determining a former
spouse’s share of the Participant’s Deferral Account, and it does not provide for payment to
the former spouse prior to the time the Participant or his/her Beneficiary is eligible for
payment. Payment pursuant to the order shall reduce the Participant’s Deferral Account.
	 
	14.3.	 	Tax Withholding. The Company may withhold from a Participant’s compensation or any payment
made by it under the Plan such 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.
	 
	14.4.	 	Incapacity. If the Administrator determines that any Participant or other person entitled to
payments under the Plan is incompetent by reason of physical or mental disability and
consequently is unable to give a valid receipt for payments made hereunder, or is a 




15









 






	 	 	minor, the
Administrator may order the payments coming due to that person to be made to another person
for the Participant’s benefit, without responsibility on the part of the Administrator to
follow the application of amounts so paid. Payments made pursuant to this Section shall
completely discharge the Administrator, the Company and the Appeals Committee with respect to
those payments.
	 
	14.5.	 	Administrative Forms. All applications, elections and designations in connection with the
Plan made by a Participant or other person shall become effective only when duly executed on
forms or via the Plan’s Participant Access System as provided by the Administrator and filed
with the Administrator.
	 
	14.6.	 	Independence of Plan. Except as otherwise expressly provided herein, the Plan shall be
independent of, and in addition to, any other benefit agreement or plan of the Company or any
rights that may exist from time to time thereunder.
	 
	14.7.	 	Responsibility for Legal Effect. None of the Company, the Administrator, the Appeals
Committee or any other 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 the Plan. Without limiting the generality
of the foregoing, the Company shall not have any liability for the tax liability that a
Participant may incur resulting from participation in the Plan or Benefit Payments hereunder.
	 
	14.8.	 	Limitation of Duties. The Company, the Board, the Administrator, the Appeals Committee, and
their respective officers, members, employees and agents, shall have no duty or responsibility
under the Plan other than the duties and responsibilities expressly assigned to them herein or
delegated to them pursuant hereto. None of them shall have any duty or responsibility with
respect to the duties or responsibilities assigned or delegated to another of them.
	 
	14.9.	 	Limitation of Sponsor Liability. Any right or authority exercisable by the Company, pursuant
to any provision of the Plan, shall be exercised in the Company’s capacity as sponsor of the
Plan, or on behalf of the Company in that capacity, and not in a fiduciary capacity, and may
be exercised without the approval or consent of any person in a fiduciary capacity. Neither
the Company, nor any of its respective officers, members, employees, agents and delegates,
shall have any liability to any party for its exercise of any such right or authority.
	 
	14.10.	 	Successors. The terms and conditions of the Plan shall inure to the benefit of and bind the
Company and its successors, the Participants, their Beneficiaries and the personal
representatives of the Participants and their Beneficiaries.
	 
	14.11.	 	Controlling Law. The Plan shall be construed in accordance with the laws of the State of
Ohio to the extent not preempted by laws of the United States.
	 
	14.12.	 	Notice. Any notice or filing required or permitted to be given to the Administrator or the
Board under the Plan shall be sufficient if in writing and hand-delivered, or sent by
registered or certified mail, to the address below:




16









 










Libbey Inc.

300 Madison Avenue

Toledo, Ohio 43699-0060

Attn:   Administrator, Libbey Inc.

            Libbey Inc. 2009 Director Deferred Compensation Plan





	14.13.	 	Headings and Titles. The headings and titles of Articles and Sections used in the Plan are
for convenience of reference only and shall not be considered in construing the Plan.
	 
	14.14.	 	General Rules of Construction. The masculine gender shall include the feminine and neuter,
and vice versa, as the context shall require. The singular number shall include the plural,
and vice versa, as the context shall require. The present tense of a verb shall include the
past and future tenses, and vice versa, as the context requires.
	 
	14.15.	 	Severability. If any provision or term of the 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 the Plan or the
agreement or instrument shall remain in full force and effect and shall be enforceable as if
the void or non-enforceable provision or term had never been a part of the Plan, or the
agreement or instrument except as to the extent the Administrator determines the result would
have been contrary to the intent of the Company in establishing and maintaining the Plan.
	 
	14.16.	 	Indemnification. The Company shall indemnify, defend, and hold harmless any Director,
officer or Board member for all acts taken or omitted in carrying out the responsibilities of
the Company, Board, Administrator or Appeals Committee under the terms of the Plan. This
indemnification for all such acts taken or omitted is intentionally broad, but shall not
provide indemnification for any civil penalty that may be imposed by law, nor shall it provide
indemnification for embezzlement or diversion of Plan funds for the benefit of any such
individual. The Company shall indemnify any such individual for expenses of defending an
action by a Participant, Beneficiary, service provider, government entity or other person,
including all legal fees and other costs of the defense. The Company shall also reimburse any
such individual for any monetary recovery in a successful action against the individual in any
federal or state court or arbitration. In addition, if a claim is settled out of court with
the concurrence of the Company, the Company shall indemnify any such individual for any
monetary liability under any such settlement, and the expenses thereof. The indemnification
will not be provided to any person who is not a present or former Director, officer or Board
member of the Company, nor shall it be provided for any claim by the Company against any such
individual.





* * * * *




     THEREFORE, Libbey Inc. has caused the Plan to be executed and adopted as of January 1, 2009.



	 	 	 	 	 	 	 	 	 
	Libbey Inc.	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By

	 	/s/ John F. Meier
	 	 	 	Date:
	 	November 10, 2008
	 

	 	 	 	 	 	 	 	 
	 	 	John F. Meier, Chief Executive Officer	 	 






17









 






	 	 	 	 	 	 	 	 	 
	Attest:	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	By

	 	/s/ Susan Allene Kovach	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 
	 	 	Susan Allene Kovach, Secretary	 	 







18