TYPE OF PLAN: Traditional Defined Benefit in excess of 1,000 participants affected
DATE ANNOUNCED: Feb. 15, 2006
DATE EFFECTIVE: April 1, 2006
DESCRIPTION OF FREEZE: Total Freeze. All salaried and certain hourly employees who participated in the company's (U.S.) defined benefit plan stopped accruing benefits on April 1.
PLAN SOLVENCY: At year-end 2003, defined benefit pension plan obligations were $430.7 million and plan assets were $289.6 million.
REPORTED FINANCIAL IMPLICATION: As a result of the freeze, Ferro expects savings of $30 million to $40 million between 2006 and 2011.
NEW ARRANGEMENTS FOR EMPLOYEES: Starting on April 1, regardless of whether the employee contributes to his 401(k), Ferro will make annual contributions to employees' 401(k) accounts, varying from 2% to 8%, dependent upon the employee's salary and years of service. Also, Ferro will match employee contributions up to 5% of salary. This company-sponsored plan was established for new employees hired after July 1, 2003.
BACKGROUND: Ferro is a major international producer of performance materials for industry, including coatings and performance chemicals. The company has operations in 20 countries.
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