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Exhibit 10.1
FERRO CORPORATION
SUPPLEMENTAL EXECUTIVE
DEFINED CONTRIBUTION PLAN
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FERRO CORPORATION
SUPPLEMENTAL EXECUTIVE
DEFINED CONTRIBUTION PLAN
Section Page
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ARTICLE I
DEFINITIONS
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1.1 Definitions ......................................................... 2
1.2 Construction ........................................................ 4
ARTICLE II
ELIGIBILITY FOR PLAN PARTICIPATION 5
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ARTICLE III
SUPPLEMENTAL MATCHING CONTRIBUTIONS
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3.1 Supplemental Matching Contributions ................................. 6
3.2 Vesting of Supplemental Matching
Contributions...................................................... 6
3.3 Years of Vesting Service............................................. 7
ARTICLE IV
SEPARATE ACCOUNTS
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4.1 Types of Separate Accounts .......................................... 8
4.2 Adjustment of Separate Accounts ..................................... 8
ARTICLE V
DISTRIBUTION
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5.1 Distribution Upon Termination of Employment ......................... 9
5.2 Method of Distribution .............................................. 9
5.3 Times of Payments.................................................... 9
5.4 Distributions Upon Death............................................. 9
5.5 Taxes................................................................ 9
(i)
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ARTICLE VI
BENEFICIARIES 11
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ARTICLE VII
ADMINISTRATIVE PROVISIONS
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7.1 Administration ..................................................... 12
7.2 Powers and Authorities of the Board ................................ 12
7.3 Indemnification .................................................... 12
ARTICLE VIII
AMENDMENT AND TERMINATION 14
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ARTICLE IX
MISCELLANEOUS
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9.1 Non-Alienation of Benefits ......................................... 15
9.2 Payment of Benefits to Others ...................................... 15
9.3 Qualified Domestic Relations Orders................................. 15
9.4 Plan Non-Contractual ............................................... 16
9.5 Funding ............................................................ 16
9.6 Claims of Other Persons ............................................ 17
9.7 Severability ....................................................... 17
9.8 Governing Law ...................................................... 17
(ii)
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FERRO CORPORATION
SUPPLEMENTAL EXECUTIVE
DEFINED CONTRIBUTION PLAN
WHEREAS, Ferro Corporation (hereinafter referred to as the "Company")
desires to establish a supplemental retirement plan for the benefit of a select
group of management or highly compensated employees employed by the Company or
an Affiliate thereof whose benefits under the Ferro Corporation Savings and
Stock Ownership Plan are limited or reduced by certain provisions of the
Internal Revenue Code of 1986, as amended (hereinafter referred to as the
"Code");
NOW, THEREFORE, effective as of January 1, 1996, the Company hereby
establishes the Ferro Corporation Supplemental Executive Defined Contribution
Plan (hereinafter referred to as the "Plan") to provide benefits not otherwise
provided due to such limitations as hereinafter set forth.
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ARTICLE I
DEFINITIONS
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1.1 DEFINITIONS. Except as otherwise required by the context, the terms
used in the Plan shall have the meaning hereinafter set forth.
(i) AFFILIATE. The term "AFFILIATE" shall mean any member of a
controlled group of corporations (as determined under Section 414(b) of the
Code) of which the Company is a member; any member of a group of trades or
businesses under common control (as determined under Section 414(c) of the
Code) with the Company; and any member of an affiliated service group (as
determined under Section 414(m) of the Code) of which the Company is a
member.
(ii) BENEFICIARY. The term "BENEFICIARY" shall mean the person who, in
accordance with the provisions of Article VI, shall be entitled to receive
a distribution hereunder in the event a Participant dies before his
interest under the Plan has been distributed to him in full.
(iii) BOARD. The term "BOARD" shall mean the Board of Directors of the
Company.
(iv) CHANGE OF CONTROL. The term "CHANGE OF CONTROL" shall mean a
change in control of the Company of a nature that would be required to be
reported in response to Item 6(e) of Schedule 14A of Regulation 14A
promulgated under the Securities Exchange Act of 1934, as amended
("Exchange Act"); provided that, without limitation, such a Change in
Control shall be deemed to have occurred if and at such times as (i) any
"person" (as such term is used in Sections 13(d)(3) and 14(d)(2) of the
Exchange Act) is or becomes the beneficial owner, directly or indirectly,
of securities of the Company representing twenty-five percent (25%) or more
of the combined voting power of the Company's then outstanding securities;
or (ii) during any period of two consecutive years, individuals who at the
beginning of such period constituted the Board of Directors of the Company
and any new director (other than a director designated by a person who has
entered into
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an agreement or arrangement with the Company to effect a transaction
described in clause (i) or (iii) of this sentence) whose appointment,
election, or nomination for election by the Company's shareholders, was
approved by a vote of at least two-thirds of the directors then still in
office who either were directors at the beginning of the period or whose
election or nomination for election was previously so approved, cease for
any reason to constitute at least a majority of the Board of Directors of
the Company; or (iii) there is consummated a merger or consolidation of the
Company or a subsidiary thereof with or into any other corporation, other
than a merger or consolidation which would result in the holders of the
voting securities of the Company outstanding immediately prior thereto
holding securities which represent immediately after such merger or
consolidation more than 50% of the combined voting power of the voting
securities of either the Company or the other entity which survives such
merger or consolidation or the parent of the entity which survives such
merger or consolidation; or (iv) there is consummated the sale or
disposition by the Company of all or substantially all the Company's
assets.
(v) CODE. The term "CODE" shall mean the Internal Revenue Code of
1986, as amended from time to time. Reference to a section of the Code
shall include such section and any comparable section or sections of any
future legislation that amends, supplements, or supersedes such section.
(vi) COMPANY. The term "COMPANY" shall mean Ferro Corporation, its
corporate successors, and the surviving corporation resulting from any
merger of Ferro Corporation with any other corporation or corporations.
(vii) COMPENSATION. The term "COMPENSATION" shall mean the
compensation within the meaning of Section 415(c)(3) of the Code, subject
to the provisions of Section 414(q)(6), paid during a Plan Year by the
Employer to a Participant while a Participant, including all wages and
salary, commissions and bonuses, overtime pay, and used or accrued vacation
pay and any Pre-Tax Contributions contributed under the SSOP with respect
to such Participant during such Plan Year and elective employer
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contributions made on behalf of a Participant that are not includable in
gross income under Section 125, Section 402(e)(3), Section 402(h)(1)(B),
and Section 403(b) of the Code, but excluding relocation expense
reimbursements (including mortgage interest differentials) or other expense
allowances or fringe benefits, which are paid with respect to a period
following termination of employment, automobile allowance income and
foreign service premiums, deferred compensation (other than Pre-Tax
Contributions), and allowances or any other extraordinary income and
welfare benefits.
(viii) DISABILITY. The term "DISABILITY" shall mean eligibility to
receive disability benefits under a long-term disability plan maintained by
the Company or an Affiliate.
(ix) FUND. The term "FUND" shall mean any of the funds maintained for
the investment of Plan assets in accordance with the provisions of Article
VII.
(x) PARTICIPANT. The term "PARTICIPANT" shall mean any employee of the
Company or an Affiliate, who participates in the Plan pursuant to Article
II of the Plan.
(xi) PLAN. The term "PLAN" shall mean the Ferro Corporation
Supplemental Executive Defined Contribution Plan as set forth herein.
(xii) SSOP. The term "SSOP" shall mean the Ferro Corporation Savings
and Stock Ownership Plan, as amended from time to time.
(xiii) SEPARATE ACCOUNT. The term "SEPARATE ACCOUNT" shall mean the
account maintained in the name of a Participant pursuant to Section 4.1 of
the Plan.
(xiv) VALUATION DATE. The term "VALUATION DATE" shall mean the last
day of each calendar year.
(xv) YEARS OF VESTING SERVICE. The term "YEARS OF VESTING SERVICE"
shall mean service credited to a Participant under the provisions of
Section 3.5.
1.2 CONSTRUCTION. Where necessary or appropriate to the meaning hereof, the
singular shall be deemed to include the plural, the plural to include
the singular, the masculine to include the feminine, and the feminine
to include the masculine.
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ARTICLE II
ELIGIBILITY FOR PLAN PARTICIPATION
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Any select management or highly compensated employee of the Company or an
Affiliate who is classified as being in Salary Grade 22 or higher and whose
contributions under the SSOP are limited due to the provisions of Section
401(a)(17), Section 401(k), Section 401(m), Section 402(g), or Section 415 of
the Code, shall become a Participant in the Plan as of the Effective Date or the
January 1 immediately following the date he is classified as being in Salary
Grade 22 or higher, whichever occurs later.
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ARTICLE III
SUPPLEMENTAL MATCHING CONTRIBUTIONS
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3.1 SUPPLEMENTAL MATCHING CONTRIBUTIONS. Each Plan Year a Supplemental
Matching Contribution shall be credited to the Supplemental Matching Account of
each Participant (i) who is making the maximum 401(k) Contributions permitted
under the SSOP and (ii) who is employed by the Employer on the last day of the
Plan Year or who died, retired and began receiving pension benefits under a
defined benefit plan of the Company or an Affiliate, or incurred a Disability
during the Plan Year. Such Supplemental Matching Contribution shall be equal to
the amount of Matching Contributions that would have been made under the SSOP
for such Plan Year if the 401(k) Contributions of such Participant under the
SSOP had not been limited due to the provisions of the Code and if the
Participant had elected to make 401(k) Contributions under the SSOP equal to 8
percent of his Compensation, minus the amount of Matching Contributions actually
credited to such Participant under the SSOP for such Plan Year.
3.2 VESTING OF SUPPLEMENTAL MATCHING CONTRIBUTIONS. A Participant shall
become vested in the balance of his Supplemental Matching Account pursuant to
the following schedule.
Years of Vesting Service Percentage Vested
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Less than 1 year 0%
1 year, but less than 2 20%
2 years, but less than 3 40%
3 years, but less than 4 60%
4 years, but less than 5 80%
5 years or more 100%
Notwithstanding the foregoing, a Participant who is employed by the Company or
an Affiliate shall become 100% vested in his Supplemental Matching Account upon
the earlier of: (i)
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attainment of age 65, (ii) Disability, (iii) death, or (iv) a Change of Control.
3.3 YEARS OF VESTING SERVICE. For purposes of determining the vested
interest of a Participant in his Supplemental Matching Account, a Participant
shall be credited with Years of Vesting Service equal to the Years of Service
with which he is credited under the SSOP.
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ARTICLE IV
SEPARATE ACCOUNTS
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4.1 TYPES OF SEPARATE ACCOUNTS. Each Participant shall have established in
his name a Separate Account which shall reflect the Supplemental Matching
Contributions credited to him under Section 3.1 and any adjustment thereto
pursuant to Section 4.2.
4.2 ADJUSTMENT OF SEPARATE ACCOUNTS. The Separate Account of a Participant
shall be adjusted as of each Valuation Date to reflect the deemed investment of
such Separate Accounts in the Fund as determined by the Company.
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ARTICLE V
DISTRIBUTION
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5.1 DISTRIBUTION UPON TERMINATION OF EMPLOYMENT. The entire value credited
to a Participant's Separate Account shall be distributed in cash to such
Participant or his Beneficiary after the Disability of such Participant or after
the termination of such Participant's employment with the Company and
Affiliates, whichever occurs earlier.
5.2 METHOD OF DISTRIBUTION. Except as otherwise may be provided in Sections
5.3 and 5.4, the benefits payable under the Plan from a Participant's Separate
Account shall be paid to the Participant, or his Beneficiary, if applicable, in
a single sum cash payment and shall be determined as of the most recent
Valuation Date plus a pro-rata share of the investment credit through the last
day of the month in which termination occurred. Any Supplemental Matching
Contribution earned in the final year of employment shall be determined on the
next succeeding Valuation Date.
5.3 TIME OF PAYMENTS. Except as otherwise provided in Section 5.4,
distribution of the value of a Participant's Separate Accounts shall commence as
soon as practicable after the Participant's termination of employment due to
resignation, retirement, death or other reason.
5.4 DISTRIBUTIONS UPON DEATH. Upon the death of a Participant, the value of
his Separate Account shall be paid to his Beneficiary pursuant to the provisions
of Section 5.3 and Article VI.
5.5 TAXES. In the event any taxes are required by law to be withheld or
paid from any payments made pursuant to the Plan, the Company shall cause the
withholding of such amounts from such payments and shall transmit the withheld
amounts to the appropriate taxing
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authority.
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ARTICLE VI
BENEFICIARIES
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In the event a Participant dies before his interest under the Plan in his
Separate Account has been distributed to him in full, any remaining interest
shall be distributed pursuant to Article V to his Beneficiary, who shall be the
person designated in writing and in the form and manner specified by the Company
as his Beneficiary under the Plan. In the event a Participant does not designate
a Beneficiary or his designated Beneficiary does not survive him, his
beneficiary under the SSOP shall be his Beneficiary for Plan purposes.
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ARTICLE VII
ADMINISTRATIVE PROVISIONS
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7.1 ADMINISTRATION. The Plan shall be administered by the Company in a
manner that is generally consistent with the administration of the SSOP, as from
time to time amended, except that the Plan shall be administered as an unfunded
plan not intended to meet the qualification requirements of Section 401 of the
Code.
7.2 POWERS AND AUTHORITIES OF THE COMPANY. The Company shall have full
power and authority to interpret, construe and administer the Plan and its
interpretations and construction hereof, and actions hereunder, including the
timing, form, amount or recipient of any payment to be made hereunder, shall be
binding and conclusive on all persons for all purposes. The Company may delegate
any of its powers, authorities, or responsibilities for the operation and
administration of the Plan to any person or a committee so designated in writing
by it and may employ such attorneys, agents, and accountants as it may deem
necessary or advisable to assist it in carrying out its duties hereunder.
7.3 INDEMNIFICATION. In addition to whatever rights of indemnification a
person or persons to whom any power, authority, or responsibility is delegated
pursuant to Section 7.2, may be entitled under the articles of incorporation,
regulations, or by-laws of the Company, under any provision of law, or under any
other agreement, the Company shall satisfy any liability actually and reasonably
incurred by any such member or such other person or persons, including expenses,
attorneys' fees, judgments, fines, and amounts paid in settlement, in connection
with any threatened, pending, or completed action, suit, or proceeding which is
related to the exercise or failure to exercise by such member or such other
person or persons of any of the powers,
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authority, responsibilities, or discretion provided under the Plan.
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ARTICLE VIII
AMENDMENT AND TERMINATION
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The Company reserves the right to amend or terminate the Plan at any time
by action of the Board; provided, however, that no such action shall adversely
affect any Participant who is receiving benefits under the Plan or whose
Separate Account is credited with any Supplemental Matching Contributions
thereto, unless an equivalent benefit is provided under another plan or program
sponsored by the Company or an Affiliate.
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ARTICLE IX
MISCELLANEOUS
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9.1 NON-ALIENATION OF BENEFITS. Except as provided in Section 9.3, no
benefit under the Plan shall at any time be subject in any manner to alienation
or encumbrance. If any Participant or Beneficiary shall attempt to, or shall,
alienate or in any way encumber his benefits under the Plan, or any part
thereof, or if by reason of his bankruptcy or other event happening at any time
any such benefits would otherwise be received by anyone else or would not be
enjoyed by him, his interest in all such benefits shall automatically terminate
and the same shall be held or applied to or for the benefit of such person, his
spouse, children, or other dependents as the Board may select.
9.2 PAYMENT OF BENEFITS TO OTHERS. If any Participant or Beneficiary to
whom a benefit is payable is unable to care for his affairs because of illness
or accident, any payment due (unless prior claim therefor shall have been made
by a duly qualified guardian or other legal representative) may be paid to the
spouse, parent, brother, or sister, or any other individual deemed by the Board
to be maintaining or responsible for the maintenance of such person. Any payment
made in accordance with the provisions of this Section 9.2 shall be a complete
discharge of any liability of the Plan with respect to the benefit so paid.
9.3 QUALIFIED DOMESTIC RELATIONS ORDERS. Notwithstanding the foregoing, the
provisions of Section 9.1 shall not apply with respect to a "qualified domestic
relations order." As used herein, a "qualified domestic relations order" shall
mean a judgment, decree or order (including approval of any property settlement
agreement) which relates to a provision of child support, alimony payments or
marital property rights to a spouse, child or other dependent of a
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Participant and which is made pursuant to the domestic relations or community
property laws of any State. Any such order must comply with the provisions of
Section 414(p) of the Code and with any regulations issued thereunder. The
Company shall in its sole discretion establish such rules and regulations as it
deems necessary to determine whether an order meets such requirements.
9.4 PLAN NON-CONTRACTUAL. Nothing herein contained shall be construed as a
commitment or agreement on the part of any person employed by the Company or an
Affiliate to continue his employment with the Company or Affiliate, and nothing
herein contained shall be construed as a commitment on the part of the Company
or the Affiliate to continue the employment or the annual rate of compensation
of any such person for any period, and all Participants shall remain subject to
discharge to the same extent as if the Plan had never been established.
9.5 FUNDING. In order to provide a source of payment for its obligations
under the Plan, the Company may establish a trust fund. Subject to the
provisions of the trust agreement governing such trust fund, the obligation of
the Company under the Plan to provide a Participant or a Beneficiary with a
benefit constitutes the unsecured promise of the Company to make payments as
provided herein, and no person shall have any interest in, or a lien or prior
claim upon, any property of the Company. In addition, it is the intention of the
Company that benefits credited to a Participant under the Plan shall not be
included in the gross income of the Participants or their Beneficiaries until
such time as benefits are distributed under the provisions of the Plan. If, at
any time, it is determined that benefits under the Plan are currently taxable to
a Participant or his Beneficiary, the currently amounts credited to the
Participant's Separate
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Account which become so taxable shall be distributable immediately to him;
provided, however, that in no event shall amounts so payable to a Participant
exceed the value of his Separate Account.
9.6 CLAIMS OF OTHER PERSONS. The provisions of the Plan shall in no event
be construed as giving any person, firm or corporation any legal or equitable
right as against the Company, its officers, employees, or directors, except any
such rights as are specifically provided for in the Plan or are hereafter
created in accordance with the terms and provisions of the Plan.
9.7 SEVERABILITY. The invalidity or unenforceability of any particular
provision of the Plan shall not affect any other provision hereof, and the Plan
shall be construed in all respects as if such invalid or unenforceable provision
were omitted herefrom.
9.8 GOVERNING LAW. The provisions of the Plan shall be governed and
construed in accordance with the laws of the State of Ohio.
EXECUTED at Cleveland, Ohio, this 25 day of July, 1996.
FERRO CORPORATION
By: /s/ Gary H. Ritondaro
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Title: Vice President and Chief Financial
Officer
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