EXHIBIT 10(o)
SEPARATION AGREEMENT
AND RELEASE
This document is a SEPARATION AGREEMENT AND RELEASE (this "Separation
Agreement") and is between FERRO CORPORATION ("Ferro") and M. CRAIG Benson ("Mr.
Benson").
For good and valuable consideration, and intending to be legally bound,
Ferro and Mr. Benson hereby agree as follows:
1. TERMINATION OF EMPLOYMENT
A. Ferro has employed Mr. Benson since January 1, 2000.
B. As of January 1, 2000, Mr. Benson and Ferro signed an employment
agreement (the "Employment Agreement") with Ferro, which agreement was
amended effective March 15, 2000.
C. As of July 31, 2001, Ferro and Mr. Benson signed a Change in Control
Agreement (the "Change in Control Agreement").
D. As of March 2, 2002, Mr. Benson and Ferro executed a Confidentiality
Agreement ("Confidentiality Agreement").
E. Mr. Benson currently serves as Ferro's Vice President, Electronic
Material Systems.
F. Ferro and Mr. Benson have mutually decided to end Mr. Benson's
employment relationship with Ferro on the terms and conditions set
forth in this Separation Agreement.
2. NORMAL PACKAGE
A. Under Ferro's standard severance policy, Mr. Benson would have been
entitled to receive -
(1) An amount equal to one week's base pay for each completed year of
service plus five additional weeks' pay, or $52,884.59 (i.e.,
$4,807.69 times 11 weeks),
(2) Two weeks' pay in lieu of notice, or $9,615.38 (i.e., $4,807.69
times two weeks), and
(3) Health care (i.e., medical and dental) coverage for the month of
separation plus an additional four months, i.e., coverage through
June 30, 2006.
B. The payments and benefits Mr. Benson would have been entitled to
receive under Ferro's standard severance practice are called the
"Normal Package" below.
3. ENHANCED PACKAGE
In consideration of the agreements and promises made by Mr. Benson in this
Separation Agreement, Ferro is prepared to provide Mr. Benson with, and Mr.
Benson hereby elects to receive, the following enhanced separation pay and
benefits (the "Enhanced Package") in lieu of the Normal Package on and
subject to the terms and conditions of this Separation Agreement:
A. CONTINUATION ON PAYROLL
Mr. Benson will continue on Ferro's payroll at his current salary and
with his current employee benefits through February 28, 2006. Mr.
Benson's employment with Ferro will terminate at the close of business
on that date.
B. SEVERANCE PERIOD
The "Severance Period" will be the period beginning March 1, 2006, and
ending the earlier of August 31, 2007, or the date on which Mr. Benson
begins employment and receives income from another employer.
C. SEVERANCE PAYMENTS
During the Severance Period, Ferro will pay Mr. Benson as severance
Mr. Benson's current base salary of $10,416.67 per pay period.
D. SEVERANCE BENEFITS
During the Severance Period, Ferro will pay the employer's portion of
Mr. Benson's premium costs under Ferro's group health (i.e., medical,
dental, and vision) plans.
E. UNUSED VACATION
On or before April 10, 2006, Ferro will pay Mr. Benson the amount of
$15,000.00 representing 15 days of earned but unused vacation.
F. COMPANY AUTOMOBILE
On or before May 1, 2006, Mr. Benson will be entitled to purchase his
company automobile in accordance with normal Ferro policy applicable
to corporate officers of Ferro. Mr. Benson will be entitled to the use
of such automobile (together with gasoline, normal maintenance, and
insurance) until such date.
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G. CELLULAR TELEPHONE
Mr. Benson will be entitled to the continued use of his company
cellular telephone until March 1, 2006. Ferro will cooperate with Mr.
Benson in transferring his company cellular telephone number to a
personal cellular telephone service of Mr. Benson's choosing.
H. COMPANY COMPUTER
Ferro has custody of Mr. Benson's company computer. Ferro will delete
from the computer's hard drive any and all Ferro confidential and
proprietary information. When Ferro has completed the deletion
process, Ferro will return the company computer to Mr. Benson and Mr.
Benson will be entitled to retain the company computer at no cost to
Mr. Benson. Mr. Benson will not use any information or data remaining
on such computer in any manner that is inconsistent with his
obligations under numbered paragraph 8 below.
I. OUTPLACEMENT
For a period of one year after the termination of his employment,
Ferro will provide Mr. Benson (at Ferro's cost) with the services of
an executive outplacement firm selected by Ferro and acceptable to Mr.
Benson.
J. OTHER BENEFITS
Except as set forth above, nothing in this Separation Agreement will
abrogate or otherwise modify or amend Mr. Benson's rights and benefits
under other employee benefit plans. Accordingly, Mr. Benson's rights
and benefits under such other employee benefit plans will be governed
by the terms and conditions of such plans.
4. ANNUAL INCENTIVE PLAN
A. Mr. Benson is a participant in the Ferro annual incentive plan and is
eligible for a bonus payment under such plan for the year 2005.
B. Ferro will determine the amount of Mr. Benson's bonus (if any) in good
faith and in the ordinary course. If Mr. Benson is entitled to a bonus
payment for 2005, Ferro will pay Mr. Benson the bonus when payments
are made to other participants.
C. Mr. Benson will not be eligible for a bonus payment for the years 2006
or 2007.
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5. STOCK OPTIONS
A. Mr. Benson has been awarded the following as-yet-unexercised options
under Ferro's 1985 Employee Stock Option Plan and Ferro's 2003
Long-Term Incentive Compensation Plan:
(1) 5,500 Non-Qualified Options granted February 11, 2000, with an
option exercise price of $18.50 per share,
(2) 5,500 Non-Qualified Options granted February 9, 2001, with an
option exercise price of $23.60 per share,
(3) 2,000 Non-Qualified Options granted February 9, 2001, with an
option exercise price of $23.60 per share,
(4) 10,000 Non-Qualified Options granted February 11, 2002, with an
option exercise price of $25.50 per share,
(5) 7,000 Non-Qualified Options granted February 28, 2003, with an
option exercise price of $21.26 per share,
(6) 20,000 Non-Qualified Options granted February 9, 2004, with an
option exercise price of $26.26 per share,
(7) 12,372 Non-Qualified Options granted February 7, 2005, with an
option exercise price of $19.39 per share, and
(8) 20,628 Incentive Stock Options granted February 7, 2005, with an
option exercise price of $19.39 per share.
Mr. Benson will not be awarded any further options under any Ferro
stock option plan.
B. Subject to any trading blackouts that may from time to time be in
effect, Mr. Benson will be entitled to exercise any of the foregoing
options that have vested as of the date his employment with Ferro
terminates provided Mr. Benson carries out such exercise no later than
90 days after Ferro has filed its Annual Report on Form 10-K for the
fiscal year ended December 31, 2005, with the Securities and Exchange
Commission. After such 90-day period has ended, however, Mr. Benson
will not be entitled to exercise any further Ferro stock options.
6. PERFORMANCE SHARE AWARDS
A. Ferro made an award of 5,000 Performance Shares to Mr. Benson in 2003
under Ferro's 1997 Performance Share Plan and Ferro's 2003 Long-Term
Incentive Compensation Plan for the performance period January 1,
2003, through December 31, 2005. Ferro will determine
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the amount (if any) of Mr. Benson's award with respect to such
Performance Shares in good faith and in the ordinary course. If Mr.
Benson is entitled to a distribution of shares or payment in respect
of such award, Ferro will make the resulting distribution of shares or
payment to Mr. Benson when distributions and payments are made to
other participants.
B. Ferro has also made the following as-yet-unmatured awards of
Performance Shares to Mr. Benson under Ferro's 1997 Performance Share
Plan and/or Ferro's 2003 Long-Term Incentive Compensation Plan:
(1) 8,300 Performance Shares for the performance period January 1,
2004, through December 31, 2006, and
(2) 7,300 Performance Shares for the performance period January 1,
2005, through December 31, 2007.
C. Ferro will make no further awards to Mr. Benson under the Performance
Share Plan and Mr. Benson will be eligible for no further
distributions or payments with respect to such as-yet-unmatured
Performance Shares.
7. ACQUISITION PERFORMANCE REWARD PLAN AWARD
A. In 2001, in connection with the dmc(2) acquisition, Ferro awarded Mr.
Benson 3,000 Reward Shares under the Ferro Acquisition Performance
Reward Plan.
B. According to the terms Acquisition Performance Reward Plan, if
targeted results were achieved during a four-year performance period,
Mr. Benson would receive a cash payment according to a formula set
forth in the award.
C. Ferro will determine the amount (if any) of Mr. Benson's award with
respect to such Reward Shares in good faith and in the ordinary
course. If Mr. Benson is entitled to a payment in respect of such
Reward Shares, then Ferro will make the resulting payment to Mr.
Benson when payments are made to other participants.
8. NON-COMPETITION AND CONFIDENTIALITY
Mr. Benson will not disclose this Separation Agreement or its terms to
anyone other than his spouse or his personal tax advisor, financial
advisor, or attorney.
In addition, in consideration of the Enhanced Package, Mr. Benson promises
that:
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A. During the Severance Period and for a period of one year thereafter,
Mr. Benson will not, without Ferro's prior written approval, directly
or indirectly, engage in, or assist or have an ownership interest in,
or act as agent, advisor or consultant of, for, or to any person,
firm, partnership, corporation or other entity that is engaged in, the
manufacture or sale of products that compete with Ferro's electronic
material systems products or any products which are logical
extensions, on a manufacturing or technological basis, of such
products. (For purposes of this Separation Agreement, companies that
compete with Ferro's electronic material systems business will be
deemed to be only those businesses listed on Appendix A to this
Separation Agreement.)
B. During the Severance Period and thereafter, Mr. Benson will not
disclose to any persons any proprietary or confidential business
information concerning Ferro, any of its affiliated companies,
obtained or which came to Mr. Benson's attention during the course of
his employment with Ferro as set forth in paragraphs 2, 3 and 4 of the
Confidentiality Agreement.
C. During the Severance Period and thereafter, Mr. Benson will not make
any statements or disclose any information concerning Ferro, its
directors, officers, management, staff, employees, representatives, or
agents (collectively, "Ferro and its management") which reasonably
could be expected to disparage Ferro or its management, damage the
reputation or business prospects of Ferro or its management, or
interfere in any way with the business relations Ferro has with its
customers (including potential customers), suppliers, alliance
partners, employees, investors, or shareholders.
In addition, Mr. Benson hereby reaffirms the commitments he made to Ferro
in paragraphs 1-4 of his Confidentiality Agreement, but otherwise Mr.
Benson's Employment Agreement and Confidentiality Agreement will have no
further force or effect and are superseded entirely by this Separation
Agreement.
9. WAIVER
Mr. Benson acknowledges that Ferro is providing the Enhanced Package in
lieu of all other benefits to which Mr. Benson is or may be entitled
arising out of Mr. Benson's employment and/or termination of employment.
Mr. Benson hereby waives any and all rights to any other severance benefits
offered to Ferro employees or other right or benefit under any agreement,
understanding, or promise, whether written or oral, between Mr. Benson and
Ferro.
10. JOB CLASSIFICATIONS
There are no other Ferro employees in Mr. Benson's job classification being
terminated.
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11. RELEASE
In consideration of the Enhanced Package, Mr. Benson hereby releases Ferro,
as well as all employees, officers, directors, parents, subsidiaries,
affiliates, agents, representatives, successors, and assigns of Ferro, from
any and all claims, demands, actions, causes of action, suits, damages,
losses, costs, attorneys' fees, and or expenses, known or unknown, which
Mr. Benson has or may claim to have against any of the foregoing arising
from his employment or as a result of his termination of employment with
Ferro.
Mr. Benson covenants to Ferro that Mr. Benson will not assert any such
claims, demands, actions, or causes of action.
Mr. Benson acknowledges that the foregoing release includes (but is not
limited to) claims arising under Federal, state, or local law in the United
States prohibiting employment discrimination, such as the Age
Discrimination in Employment Act of 1967, as amended, Title VII of the
Civil Rights Act of 1964, as amended, the Civil Rights Act of 1991, the
Employee Retirement Income Security Act, the Equal Pay Act, 42 U.S.C.
Section 1981, Section 1981 of the Civil Rights Act of 1866, the Vietnam Era
Veterans Readjustment Assistance Act, the Rehabilitation Act of 1973, the
Americans with Disabilities Act, the Family and Medical Leave Act, and all
claims under any other Federal or state laws, local ordinances or common
law and other laws restricting an employer's right to terminate the
employment relationship. Mr. Benson further acknowledges that such release
includes (but is not limited to) any claims Mr. Benson may have for
unemployment compensation or may have under any internal grievance
procedure at Ferro.
The foregoing release will not, however, apply to any claims, demands,
actions, or causes of action arising after the effective date of this
Separation Agreement that are unrelated to Mr. Benson's termination of
employment.
12. MR. BENSON'S EMPLOYMENT FILE
As soon as practicable after the effectiveness of this Separation
Agreement, Ferro will provide Mr. Benson a copy of the employment file
maintained by Ferro in the ordinary course of business; provided, however,
that Ferro had made and makes no representation or warranty about the
contents of such employment file.
12. NON-DISPARAGEMENT OF MR. BENSON
During the Severance Period and thereafter, Ferro will not make any
statements or disclose any information concerning Mr. Benson which
reasonably could be expected to disparage Mr. Benson or damage his
reputation or employment prospects.
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13. VOLUNTARY ELECTION
Mr. Benson acknowledges that:
A. The only consideration Mr. Benson has been given for signing this
Separation Agreement are the terms stated in this Separation
Agreement.
B. No other promises or agreements have been made to or with Mr. Benson
by any person or entity to induce Mr. Benson to sign this Separation
Agreement.
C. Mr. Benson has been given at least 21 days to consider the effect of
this Separation Agreement, including the release contained above,
before signing this Separation Agreement.
D. Mr. Benson has been encouraged to discuss this Separation Agreement
and any matters related to the termination of his employment
(including any rights Mr. Benson may have with respect to a claim of
employment discrimination) with a legal advisor of Mr. Benson's own
choosing and Mr. Benson has had ample opportunity to do so.
E. Mr. Benson understands that he may revoke this Separation Agreement in
writing during the seven day period beginning the day Mr. Benson signs
this Separation Agreement and delivers it to Ferro and that this
Separation Agreement will be neither effective nor enforceable until
Mr. Benson's seven-day revocation period has expired.
14. TERMINATION PROCESSING
Mr. Benson has previously surrendered to Ferro all Ferro property in his
possession (other than his company car and cellular telephone as provided
above). Immediately after the execution and delivery of this Separation
Agreement, Mr. Benson will assist Ferro's human resources department by
executing such documentation and completing such other tasks as may be
reasonably required for the orderly termination of Mr. Benson's employment.
15. WITHHOLDING
All payments under this Separation Agreement will be subject to
withholding, deductions and contributions as required by law.
16. TERMINATION OF CHANGE IN CONTROL AGREEMENT
The Change in Control Agreement is hereby terminated by mutual agreement of
Ferro and Mr. Benson effective the date of this Separation Agreement.
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17. GOVERNING LAW
This Separation Agreement will be governed by the internal substantive laws
of the State of Ohio, the state in which Mr. Benson was employed at the
time his employment was terminated.
BY SIGNING THIS SEPARATION AGREEMENT AND RELEASE, MR. BENSON AFFIRMS THAT HE HAS
READ THIS SEPARATION AGREEMENT AND RELEASE CAREFULLY, THAT HE KNOWS AND
UNDERSTANDS ITS CONTENTS, THAT HE IS SIGNING THIS SEPARATION AGREEMENT AND
RELEASE VOLUNTARILY, AND THAT SIGNING THIS SEPARATION AGREEMENT AND RELEASE IS
HIS OWN FREE ACT AND DEED.
To evidence their agreement and intention to be bound legally by this document,
M. CRAIG BENSON and FERRO CORPORATION have signed and dated this SEPARATION
AGREEMENT AND RELEASE.
M. CRAIG BENSON FERRO CORPORATION
/s/ M. Craig Benson By: /s/ James F. Kirsch
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James F. Kirsch
President & Chief Executive Officer
Date: March 6, 2006 Date: March 7, 2006
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Appendix A
Companies That Compete
with
Ferro's Electronic Material Systems Business
1. NCI (also called JCI) - dielectrics
2. Kyoritsu - dielectrics
3. DuPont Electronic Materials- metal pastes for solar and MLCC; and slurries
for CMP
4. Sumitomo - metal pastes
5. Shoei - metal pastes and metal powders
6. Heraeus Electronic Materials - metal pastes and electronic packaging
materials
7. Namics - metal pastes
8. Mitsui - surface finishing materials
9. Showa Denko - surface finishing materials
10. Fujimi - surface finishing materials and CMP slurries
11. Cabot Microelectronics - CMP slurries
12. Hitachi Electronic Materials - CMP slurries
13. Rodel - CMP slurries
M. CRAIG BENSON FERRO CORPORATION
By:
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James F. Kirsch
President & Chief Executive Officer
Date: March __, 2006 Date: March __, 2006