EXHIBIT 10.38
 
 Annual Incentive Plan (AIP)  Summary Document
 Purpose
    
    
    THE FERRO ANNUAL INCENTIVE PLAN (AlP) provides participants with an opportunity to earn additional
cash compensation based upon the achievement of the Companys business goals. The AlP is an
important element of the total competitive compensation package provided to participants and is
subject to oversight by the Board Compensation Committee as provided in the Compensation Committee
Charter.The AlP is intended to provide a strong linkage between the financial rewards received by
participants and the achievement of the Companys annual financial and business goals for the plan
year. The financial reward is an at risk component of participants compensation and must be
re-earned each year based on the achievement of defined performance goals.Plan 
Administration
    
    
    The Vice President of Human Resources administers the AlP and, with agreement from the Chief
Executive Officer (CEO) of the Company, has the authority to make or revise rules in connection
with the AlP. The Vice President of Human Resources also may adopt administrative procedures in
connection with the AlP and has discretion to interpret situations or conditions not specifically
covered in this Summary Document so as to maintain consistency with the overall purpose of the
plan.It is the responsibility of the Corporate and Group Human Resource Directors to ensure that all
additions and changes to AlP participants, including removal from the plan, are documented and
approved in a timely manner. This includes obtaining the required signatures from the applicable
SMC executive, Vice President of Human Resources and the CEO, and submitting the original document
to Corporate Compensation.Eligibility
    
    
    Eligible participants include key business leaders and managers who are full-time employees of the
Company, at a minimum U.S. salary grade of 17, or at an equivalent level outside the U.S.
Additional eligibility criteria for management participation may include responsibility for profit
and loss, departmental budgets, global scope of responsibility, degree of financial impact,
decision-making authority and market pay practices for the position.In addition, AlP participants may include sales managers and other sales-related professionals as
deemed appropriate by the Operating Vice President(s) in order to maintain a strong linkage
between their efforts and achievement of MBU financial goals.The responsible Vice President, the Vice President of Human Resources and the CEO must approve new
participants in the AlP. Additionally, new hires must be employed on or before October
1st to be eligible to participate in the current plan year. Any award will be prorated
accordingly.Approved participants will receive written notification from the Company each year, confirming
their participation, incentive target level, and applicable performance metrics.AIP Goals
    
    
    Each year, goals for the Company and its business units are determined by the CEO and Board of
Directors based on the Companys most critical operating priorities and the approved operating
budget. A range of performance is established for each AlP




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AIP Goals 
Continued
    
    
    goal including Target, Threshold and
Maximum performance levels. AlP goals for all or part of the year are communicated to participants
near the beginning of each year. If AlP goals for only part of the year are initially provided,
AIP goals for later parts of the year will be provided subsequently, near the beginning of the
relevant period. Goals and weightings may change from year to year or within a year to reflect the
operating priorities of the business. Personal Performance Objectives (PPOs) may be included as an
AlP goal if inclusion of PPOs is approved by the CEO or the Board Compensation Committee.Incentive 
Target
    
    
    Each participant in the AlP has a designated incentive target. The incentive target is the
percentage of base salary that is earned based upon the attainment of AlP Goals.Threshold, 
Target,
& Maximum
    
    
        At Threshold performance, an individuals incentive guideline would be 25% of his/her target incentive.
    At Target, the incentive guideline would be 100% of the target incentive.
    At Maximum, the incentive guideline would be 200% of the target incentive.Calculation of
Individual
Incentives &
the
Performance
Modifier
    
    
    A participants actual incentive award will be determined based upon the attainment for each
metric as described above. For financial goals, Management participants calculated score may be
increased or decreased by up to 20%, based on assessment of individual performance and achievement
of goals. For Sales participants, the calculated amount may be increased or decreased by up to
50%, based upon assessment of personal performance and achievement of individual sales targets and
goals, as established and assessed by management. If a Personal Performance Objective (PPO)
component is included in the AlP goals for a particular year, the goal will be scored by the
Manager based upon the individuals achievement of the PPOs, without further adjustment.Although individual incentives may be adjusted as described above, the total amount of the
incentives paid from each incentive pool cannot exceed the amount funded by AlP attainment for the
Company or applicable business unit.Except for employees who retire prior to the end of the year, incentive payments will be
calculated based upon the employees annual base salary as of December 31st of the plan
year (see Retirement),Performance 
Metrics May Be 
Modified
    
    
    The corporate or MBU performance metric(s) and/or PPOs may be modified throughout the plan year to
incorporate unplanned events beyond the reasonable control of the Company or participants.Assessment and
Payout
    
    
    Final assessment of results calibrated against performance metrics will be determined following
the completion of the plan year (December 31st) and will be based on audited financial
results.Payouts, if achieved, will be made to participants by March 15th following the end of
the plan year. No interest accrues on incentives between the date earned and the date paid.Performance 
Period
    
    
    The AlP performance period is January 1stthrough December 31st of each year.Mid-Year Plan 
Participation
    
    
    If an employee is hired into a position included in the AlP, either as a new-hire or internal
promotion, the employees participation will begin with the effective date of the new position,
provided it is on or before October 1stof the plan year. Management must establish
PPOs for the remainder of the plan year upon which the employee will
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later be assessed. The
employees AlP award will be calculated on a prorated basis.Mid-Year Plan 
Participation 
Continued
    
    
    An employee entering a covered position on or after October 2nd of the plan year is not
eligible to participate until the following plan year. If a newly eligible participant has been
employed by the Company in another position, the employee may be eligible for a payout under
another approved Ferro incentive plan (i.e., USIP). If the employee is new to the Company, the
employee will begin participation on January 1st of the following year and will receive
no AlP incentive payout for the remainder of the current plan year.Other Prorated 
Participation
    
    
    Employees who are on unpaid leave for greater than 30 days will not be eligible for an incentive
for the period during which they are on such leave.If a participant dies prior to the end of the plan year and an incentive is paid out for that
year, the employees estate will receive a prorated award based upon his/her annual rate of base
salary at the time of death provided the employee has worked a minimum of three months during the
plan year. Assessment of results calibrated against corporate performance measurement metrics will
be conducted after the completion of the plan year (December 31st).Retirement
    
    
    If a participant retires prior to the end of the plan year and an incentive is paid out for that
year, the employee will receive a prorated award based on his/her annual rate of base salary at
retirement provided the employee has worked a minimum of three months during the plan year.
Assessment of results calibrated against corporate performance measurement metrics will be
conducted after the completion of the plan year (December 31st).Forfeiture
    
    
    Participants who are actively employed with the Company at the end of the plan year (December
31st) will be eligible for an incentive payment for that plan year, if an incentive was
achieved under the terms of the plan. A participants right to be considered for a payout will be
forfeited if, prior to the end of the plan year, the participant is no longer in the employment of
the Company for reasons other than retirement or divestiture as described below.No Right to
Employment or
Award
    
    
    Nothing in this AlP Summary Document shall be construed to limit in any way the right of Ferro,
any affiliates or subsidiaries to terminate a participants employment at any time; nor shall it
be evidence of any agreement or understanding, expressed or implied, that Ferro, any affiliates or
subsidiaries will employ an employee in any particular position, for any particular period of
time, ensure participation in any incentive plans, or grant awards from such plans, as they may
from time to time exist.Ferro reserves the right to modify, amend or terminate the AlP at any time, or from time to time
make changes to or revise the metrics, targets, financial charts or MBU threshold designations,
figures or other information, target percentages and other aspects of the AlP due to errors,
revisions of financial results or estimates, or otherwise.Divestiture
    
    
    In the case of divestitures, performance assessments may be adjusted for participants within and
outside the divested business as deemed appropriate by management to reflect the timing and
circumstances of the divestiture in relationship to the established goals for the period. For
participants not in the divested unit, calculations may include assumed budgeted performance by
the divested unit for the post-divestiture period in addition to the actual performance of the
divested unit up to and including the date of divestiture. For participants in the divested unit,
generally
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only actual performance through the date of divestiture will be considered.Other Terms,
Rules and
Conditions
    
    
        All incentive payments will be prorated to reflect time in position.    An employee cannot receive incentive compensation payments under other Company incentive
plans for the same covered time period unless otherwise approved by the Vice President of Human
Resources and the CEO.    Individuals who have been on a personal improvement plan at any time during the plan year
may be ineligible to receive incentive compensation under this plan.    Not all eligible employees may receive an award. Individual awards may be greater or
lesser than the calculated amount.    All incentive payments are subject to applicable taxes and with holdings.
 Approvals:
 /s/ James F. Kirsch
    
    1/17/2011James F. Kirsch, Chairman, President and Chief Executive Officer
    
    Date/s/ Ann E. Killian
    
    1/14/2011Ann E. Killian, Vice President, Human Resources
    
    Date/s/ Thomas R. Miklich
    
    1/14/2011Thomas R. Miklich, Vice President & Chief Financial Officer
    
    Date
 Revised January, 2011
    
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