SECOND AMENDED AND RESTATED RECEIVABLES PURCHASE AGREEMENT

SECOND AMENDED AND RESTATED
RECEIVABLES PURCHASE AGREEMENT

Dated as of April 1, 2008

Among

FERRO FINANCE CORPORATION

as the Seller

and

CAFCO, LLC

as the Investor

and

CITIBANK, N.A.

as a Bank

and

CITICORP NORTH AMERICA, INC.

as the Agent

and

FERRO COLOR & GLASS CORPORATION
and
FERRO PFANSTIEHL LABORATORIES, INC.

as Originators

and

FERRO CORPORATION

1

as Collection Agent and an Originator
TABLE OF CONTENTS

Page

2

SCHEDULES

3

SECOND AMENDED AND RESTATED

RECEIVABLES PURCHASE AGREEMENT

Dated as of April 1, 2008

FERRO FINANCE CORPORATION, an Ohio corporation (the “ Seller ”), CAFCO, LLC, a Delaware limited liability company, CITIBANK, N.A., (“ Citibank ”), CITICORP NORTH AMERICA, INC., a Delaware corporation (“ CNAI ”), as agent (the “ Agent ”) for the Investors and the Banks (each as defined herein), FERRO COLOR & GLASS CORPORATION, a Pennsylvania corporation (“ Ferro Color ”), as an Originator, FERRO PFANSTIEHL LABORATORIES, INC., a Delaware corporation (“ FPL ”), as an Originator and FERRO CORPORATION, an Ohio corporation (“ Ferro ”), as Collection Agent and an Originator, agree as follows:

PRELIMINARY STATEMENT. The Seller, Ferro Electronic Materials Inc., Ferro, the Agent, the Collection Agent and CAFCO (as such terms are herein defined) entered into that certain Receivables Purchase Agreement dated as of September 28, 2000 (the “ Original RPA ”). The Seller, Ferro Electronic Materials Inc., Ferro, the Agent, the Collection Agent, CAFCO and Citibank, N.A., amended and restated the Original RPA pursuant to that certain Amended and Restated Receivables Purchase Agreement dated as of June  29, 2006 (as amended heretofore, the “ Existing RPA ”), pursuant to which Citibank, N.A. became a party to such amended and restated agreement. The Seller has acquired, and may continue to acquire, Receivables from Ferro, either by purchase or by contribution to the capital of the Seller, as determined from time to time by the Seller and Ferro. The Seller has sold and is prepared to continue to sell undivided fractional ownership interests (referred to herein as “ Receivable Interests ”) in the Receivables. CAFCO may, in its sole discretion, purchase such Receivable Interests, and the Banks are prepared to purchase such Receivable Interests, in each case on the terms set forth herein. The parties hereto wish to amend and restate the Existing RPA in its entirety and to add Ferro Color and FPL as parties to such amended and restated agreement. Accordingly, the parties agree that the Existing RPA is amended and restated in its entirety as follows:

ARTICLE I

DEFINITIONS

SECTION 1.01. Certain Defined Terms . As used in this Second Amended and Restated Receivables Purchase Agreement (as amended, restated, supplemented or otherwise modified from time to time, this “ Agreement ”), the following terms shall have the following meanings (such meanings to be equally applicable to both the singular and plural forms of the terms defined):

“ 2005 Downgrade Event ” means the BB Downgrade Event which occurred on June 2, 2005, as a result of the downgrade to BB by S&P of Ferro’s long term public senior unsecured non-credit-enhanced debt securities.

“ 2006 Downgrade Events ” means (i) the BB Downgrade Event which occurred on March 20, 2006, as a result of Moody’s downgrading the long term public senior unsecured non-credit-enhanced debt securities of Ferro to B1 and then withdrawing its rating on such debt securities, and (ii) the further downgrading by S&P on March 31, 2006 of the long term public senior unsecured non-credit-enhanced debt securities of Ferro to B.

“ Adjusted Eurodollar Rate ” means, for any Fixed Period, an interest rate per annum equal to the rate per annum obtained by dividing (i) the Eurodollar Rate for such Fixed Period by (ii) a percentage equal to 100% minus the Eurodollar Rate Reserve Percentage for such Fixed Period.

“ Adverse Claim ” means a lien, security interest or other charge or encumbrance, or any other type of preferential arrangement.

“ Affected Person ” has the meaning specified in Section 2.08(a).

“ Affiliate ” means, as to any Person, any other Person that, directly or indirectly, is in control of, is controlled by or is under common control with such Person or is a director or officer of such Person.

“ Affiliated Obligor ” means any Obligor that is an Affiliate of another Obligor.

“ Agent’s Account ” means the special account (account number 4063-6695) of the Agent maintained at the office of Citibank at 399 Park Avenue, New York, New York.

“ Allocation Percentage ” means, at any time, the sum of the Receivable Interest percentages at such time, based on the information in the most recent Daily Report.

“ Alternate Base Rate ” means a fluctuating interest rate per annum as shall be in effect from time to time, which rate shall be at all times equal to the highest of:

(i) the rate of interest announced publicly by Citibank in New York, New York, from time to time as Citibank’s base rate;

(ii) 1/2 of one percent above the latest three-week moving average of secondary market morning offering rates in the United States for three-month certificates of deposit of major United States money market banks, such three-week moving average being determined weekly on each Monday (or, if such day is not a Business Day, on the next succeeding Business Day) for the three-week period ending on the previous Friday by Citibank on the basis of such rates reported by certificate of deposit dealers to and published by the Federal Reserve Bank of New York or, if such publication shall be suspended or terminated, on the basis of quotations for such rates received by Citibank from three New York certificate of deposit dealers of recognized standing selected by Citibank, in either case adjusted to the nearest 1/4 of one percent or, if there is no nearest 1/4 of one percent, to the next higher 1/4 of one percent; or

(iii) the Federal Funds Rate.

“ Amortization Period ” means the period commencing on the day following the last day of the Revolving Period and ending on the later of the Facility Termination Date and the date on which no Capital of or Yield on any Receivable Interest shall be outstanding and all other amounts owed by the Seller to the Investor, the Banks, the Agent and the Collection Agent shall be paid in full.

“ Approved OECD Country ” means each of the countries listed on Schedule III-A hereto, as such Schedule may be amended from time to time upon request of the Seller or the Collection Agent, with the prior written approval of the Agent. Additionally, the Agent may remove countries from such Schedule at any time, as it determines in its sole discretion, upon prior written notice to the Seller and the Collection Agent.

“ Asset Purchase Agreement ” means (a) in the case of any Bank other than Citibank, the asset purchase agreement entered into by such Bank concurrently with the Assignment and Acceptance pursuant to which it became party to this Agreement and (b) in the case of Citibank, the secondary market agreement, asset purchase agreement or other similar liquidity agreement entered into by Citibank or any other Eligible Assignee for the benefit of CAFCO, to the extent relating to the sale or transfer of interests in Receivable Interests.

“ Assignee Rate ” for any Fixed Period for any Receivable Interest means an interest rate per annum equal to the sum of the Eurodollar Rate for such Fixed Period plus the greater of (x) 1.50% per annum and (y) 0.25% per annum plus the “Applicable Margin” then applicable to “Revolving Loans” which are “LIBO Rate Loans” under the Credit Agreement (terms in this clause (y) having the meanings set forth in the Credit Agreement); provided , however , that in case of:

(i) any Fixed Period on or prior to the first day of which an Investor or Bank shall have notified the Agent that the introduction of or any change in or in the interpretation of any law or regulation makes it unlawful, or any central bank or other governmental authority asserts that it is unlawful, for such Investor or Bank to fund such Receivable Interest at the Assignee Rate set forth above (and such Investor or Bank shall not have subsequently notified the Agent that such circumstances no longer exist),

(ii) any Fixed Period of one to (and including) 29 days (it being understood and agreed that this clause (ii) shall not be applicable to a Fixed Period for which Yield is to be computed by reference to the Eurodollar Rate that is intended to have a one-month duration but due solely to LIBOR interest period convention the duration thereof will be less than 30 days),

(iii) any Fixed Period as to which the Agent does not receive notice, by no later than 12:00 noon (New York City time) on the third Business Day preceding the first day of such Fixed Period, that the related Receivable Interest will not be funded by issuance of commercial paper, or

(iv) any Fixed Period for a Receivable Interest the Capital of which allocated to the Investors or the Banks is less than $500,000,

the “ Assignee Rate ” for such Fixed Period shall be an interest rate per annum equal to the Alternate Base Rate in effect from time to time during such Fixed Period; provided further that the Agent and the Seller may agree in writing from time to time upon a different “ Assignee Rate ”.

“ Assignment and Acceptance ” means an assignment and acceptance agreement entered into by a Bank and an Eligible Assignee and accepted by the Agent, pursuant to which such Eligible Assignee may become a party to this Agreement, in a form acceptable to the Agent and approved by the Seller (which approval by the Seller shall not be unreasonably withheld or delayed and shall not be required if an Event of Termination or an Incipient Event of Termination has occurred and is continuing).

“ Average Maturity ” means at any time that period of days equal to the average maturity of the Pool Receivables calculated by the Collection Agent in the then most recent Monthly Report; provided if the Agent shall disagree with any such calculation, the Agent may recalculate such Average Maturity.

“ Bank Commitment ” of any Bank means, (a) with respect to Citibank, $100,000,000 or such amount as reduced or increased by any Assignment and Acceptance entered into between Citibank and other Banks; or (b) with respect to a Bank that has entered into an Assignment and Acceptance, the amount set forth therein as such Bank’s Bank Commitment, in each case as such amount may be reduced or increased by an Assignment and Acceptance entered into between such Bank and an Eligible Assignee and accepted by the Agent, and as may be further reduced (or terminated) pursuant to the next sentence. Any reduction (or termination) of the Purchase Limit pursuant to the terms of this Agreement shall reduce ratably (or terminate) each Bank’s Bank Commitment.

“ Banks ” means Citibank and each Eligible Assignee that shall become a party to this Agreement pursuant to Section 10.03.

“ BB Downgrade Event ” means any of the long term public senior unsecured non-credit-enhanced debt securities of Ferro are rated below BB+ by S&P or Ba1 by Moody’s, or if Ferro does not have long term public senior unsecured non-credit-enhanced debt ratings from both S&P and Moody’s, Ferro is judged by the Agent, in its sole discretion, to be of credit quality below (with respect to each missing rating) BB+ by S&P or Ba1 by Moody’s.

“ Business Day ” means any day on which (i) banks are not authorized or required to close in New York, New York or Cleveland, Ohio, and (ii) if this definition of “Business Day” is utilized in connection with the Eurodollar Rate, dealings are carried out in the London interbank market.

“ CAFCO ” means CAFCO, LLC and any successor or assign of CAFCO that is a receivables investment company which in the ordinary course of its business issues commercial paper or other securities to fund its acquisition and maintenance of receivables.

“ Capital ” of any Receivable Interest means the original amount paid to the Seller for such Receivable Interest at the time of its purchase by CAFCO or a Bank pursuant to this Agreement, or such amount divided or combined in accordance with Section 2.07, in each case reduced from time to time by Collections distributed on account of such Capital pursuant to Section 2.04(e); provided that if such Capital shall have been reduced by any distribution and thereafter all or a portion of such distribution is rescinded or must otherwise be returned for any reason, such Capital shall be increased by the amount of such rescinded or returned distribution, as though it had not been made.

“ Cash Collateral Account ” means account no. 657 547 879 maintained by the Collection Agent, in the name of the Seller, for the benefit of the Investors, and under the sole dominion and control of the Agent, with the Cash Collateral Bank.

“ Cash Collateral Agreement ” means that certain Cash Collateral Account and Control Agreement dated May 29, 2002 by and among Ferro, the Collection Agent and the Agent, as the same has been or may be amended, restated, supplemented or otherwise modified from time to time.

“ Cash Collateral Bank ” means National City Bank.

“ Cash Secured Advance ” means, in respect of any Bank, without duplication, the aggregate amount of the proceeds (a) (i) of the advance, if any, made by such Bank pursuant to Section 2.01(d) and (ii) of such Bank’s ratable share of any applications of Collections of Receivables during the Term Period for such Bank to reduce the “Capital” in respect of the Receivable Interest hereunder and (b) on deposit at such time in the Collateral Advance Account (including any such proceeds invested by the Agent at such time in Eligible Investments pursuant to Section 6.09(c)), it being understood that the amount of such Bank’s Cash Secured Advance shall be decreased by such Bank’s ratable share of the funds paid from time to time from the Collateral Advance Account to the Seller to make a purchase of an interest in the Receivable Interest from time to time during the Term Period for such Bank.

“ Cash Secured Advance Commencement Date ” means, with respect to any Bank, the same day as the Term-Out Bank Purchase Date for such Bank, provided that the Cash Secured Advance Commencement Date shall occur if, but only if, the Facility Termination Date shall not have occurred on or prior to such date and no Event of Termination or Incipient Event of Termination exists on such date.

“ Citibank ” means Citibank, N.A., a national banking association.

“ Class 2 Special Event ” means any of the long term public senior unsecured non-credit-enhanced debt securities of Ferro are rated below B by S&P (if rated by S&P) or B2 by Moody’s (if rated by Moody’s), or if Ferro does not have long term public senior unsecured non-credit-enhanced debt ratings from both S&P and Moody’s, Ferro is judged by the Agent, in its sole discretion, to be of credit quality below (with respect to each missing rating) B by S&P or B2 by Moody’s.

“ Collateral Advance Account ” has the meaning specified in Section 6.09(a).

“ Collateral Advance Account Agreement ” means an agreement among the Collection Agent, the Seller, the Agent and the Collateral Advance Account Bank in substantially the form of Annex G hereto, and otherwise in form and substance satisfactory to the Agent.

“ Collateral Advance Account Bank ” has the meaning specified in Section 6.09(a).

“ Collateral Advance Account Direction ” has the meaning specified in Section 6.09(b).

“ Collection Agent ” means at any time the Person then authorized pursuant to Section 6.01 to administer and collect Pool Receivables.

“ Collection Agent Fee ” has the meaning specified in Section 2.05(a).

“ Collection Delay Period ” means 10 days or such other number of days as the Agent may select upon three Business Days’ notice to the Seller.

“ Collections ” means, with respect to any Receivable, all cash collections and other cash proceeds of such Receivable, including, without limitation, all cash proceeds of Related Security with respect to such Receivable, and any Collection of such Receivable deemed to have been received pursuant to Section 2.04.

“ Commitment Termination Date ” means the earlier of (a) June 3, 2008, unless , prior to such date (or the date so extended pursuant to this clause), upon the Seller’s request, made not more than 45 days prior to the then Commitment Termination Date, one or more Banks having Bank Commitments equal to 100% of the Purchase Limit shall in their sole discretion consent, which consent shall be given not more than 30 days prior to the then Commitment Termination Date, to the extension of the Commitment Termination Date to a date occurring not more than 364 days after the then Commitment Termination Date; provided , however , that any failure of any Bank to respond to the Seller’s request for such extension shall be deemed a denial of such request by such Bank and (b) the Facility Termination Date; provided , however , that if, and only if, there shall have occurred a Cash Secured Advance Commencement Date for any Bank, the Commitment Termination Date for such Bank shall mean the earlier of June 2, 2009 and the date referenced in the preceding clause (b).

“ Concentration Limit ” for any Obligor means at any time 3.25% (“ Normal Concentration Limit ”), or such other percentage (“ Special Concentration Limit ”) for such Obligor designated by the Agent in a writing delivered to the Seller; provided that in the case of an Obligor with any Affiliated Obligor, the Concentration Limit shall be calculated as if such Obligor and such Affiliated Obligor are one Obligor; provided further that the Agent may cancel any Special Concentration Limit upon three Business Days’ notice to the Seller.

“ Contract ” means an agreement between an Originator (directly and not, for the avoidance of doubt, by or through a subsidiary thereof) and an Obligor, substantially in the form of one of the written contracts or (in the case of any open account agreement) one of the invoices approved by the Agent, pursuant to or under which such Obligor shall be obligated to pay for merchandise, insurance or services from time to time.

“ CP Fixed Period Date ” means, for any Receivable Interest, the date of purchase of such Receivable Interest and thereafter the tenth day of each calendar month (or, if such day is not a Business Day, the immediately succeeding Business Day) or any other day as shall have been agreed to in writing by the Agent and the Seller prior to the first day of the preceding Fixed Period for such Receivable Interest or, if there is no preceding Fixed Period, prior to the first day of such Fixed Period.

“ Credit Agreement ” means that certain Amended and Restated Credit Agreement dated as of June 8, 2007, among Ferro and certain of its designated subsidiaries from time to time party thereto, as borrowers, various financial institutions and other persons from time to time party thereto, as lenders, Credit Suisse, Cayman Islands Branch, as term loan administrative agent, National City Bank, as the revolving loan administrative agent and the collateral agent, and Keybank National Association, as the documentation agent, and any credit facility replacing or succeeding thereto, each as the same may be amended, restated, modified or supplemented from time to time, provided , that , for the purposes of determining whether an event of default under the Credit Agreement has occurred as described in Section 7.01(o) hereof, no effect shall be given to any waiver of any breach of any financial covenant contained in the Credit Agreement that has been granted by the lenders party to the Credit Agreement.

“ Credit and Collection Policy ” means those receivables credit and collection policies and practices of the Seller in effect on the date of this Agreement and described in Schedule II hereto, as modified in compliance with this Agreement.

“ Cure Period ” means the period beginning on and including a Pool Non-compliance Date and ending on but excluding the earlier of (a) the first date thereafter on which the Net Receivables Pool Balance equals or exceeds the Required Net Receivables Pool Balance and (b) the fifth consecutive Business Day following the occurrence of such Pool Non-compliance Date.

“ Daily Report ” means a report in substantially the form of Annex A-3 hereto and containing such additional information as the Agent may reasonably request from time to time, furnished by the Collection Agent to the Agent pursuant to Section 6.02(h), following the occurrence of a BB Downgrade Event other than the 2005 Downgrade Event or the 2006 Downgrade Events.

“ Debt ” means (i) indebtedness for borrowed money, (ii) obligations evidenced by bonds, debentures, notes or other similar instruments, (iii) obligations to pay the deferred purchase price of property or services, (iv) obligations as lessee under leases which shall have been or should be, in accordance with generally accepted accounting principles, recorded as capital leases, and (v) obligations under direct or indirect guaranties in respect of, and obligations (contingent or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against loss in respect of, indebtedness or obligations of others of the kinds referred to in clauses (i) through (iv) above.

“ Default Ratio ” means the ratio (expressed as a percentage) computed as of the last day of each calendar month by dividing (i) the aggregate Outstanding Balance of all Originator Receivables that were Defaulted Receivables on such day or that would have been Defaulted Receivables on such day had they not been written off the books of the relevant Originator or the Seller during such month by (ii) the aggregate Outstanding Balance of all Originator Receivables on such day.

“ Defaulted Receivable ” means an Originator Receivable:

(i) as to which any payment, or part thereof, remains unpaid for 90 or more days from the original due date for such payment;

(ii) as to which the Obligor thereof or any other Person obligated thereon or owning any Related Security in respect thereof has taken any action, or suffered any event to occur, of the type described in Section 7.01(g); or

(iii) which, consistent with the Credit and Collection Policy, would be written off the relevant Originator’s or the Seller’s books as uncollectible.

“ Deferred Purchase Price ” has the meaning specified in the Originator Purchase Agreement.

“ Deposit Date ” means each day on which any Collections are deposited in any of the Lock-Box Accounts or on which the Collection Agent shall receive Collections of Receivables.

“ Designated Obligor ” means, at any time, each Obligor; provided , however , that any Obligor shall cease to be a Designated Obligor upon three Business Days’ notice by the Agent to the Seller.

“ Diluted Receivable ” means that portion (and only that portion) of any Originator Receivable which is either (a) reduced or canceled as a result of (i) any defective, rejected or returned merchandise or services or any failure by the relevant Originator to deliver any merchandise or provide any services or otherwise to perform under the underlying Contract or invoice, (ii) any change in the terms of or cancellation of, a Contract or invoice or any cash discount, discount for quick payment or other adjustment by the relevant Originator which reduces the amount payable by the Obligor on the related Originator Receivable (except any such change or cancellation resulting from or relating to the financial inability to pay or insolvency of the Obligor of such Originator Receivable) or (iii) any set-off by an Obligor in respect of any claim by such Obligor as to amounts owed by it on the related Originator Receivable (whether such claim arises out of the same or a related transaction or an unrelated transaction) or (b) subject to any specific dispute, offset, counterclaim or defense whatsoever (except the discharge in bankruptcy of the Obligor thereof); provided that Diluted Receivables are calculated assuming that all chargebacks are resolved in the Obligor’s favor and do not include contractual adjustments to the amount payable by an Obligor that are eliminated from the Originator Receivables balance sold to the Seller through a reduction in the purchase price for the related Originator Receivable.

“ Dilution Horizon Factor ” means, as of any date, a ratio computed by dividing (i) the aggregate original Outstanding Balance of all Originator Receivables created by the Originators during the two most recently ended calendar months by (ii) the Outstanding Balance of Originator Receivables (other than Defaulted Receivables) as at the last day of the most recently ended calendar month.

“ Dilution Percentage ” means, as of any date, (I) absent the existence of a Special Event or a Class 2 Special Event, the product of (x) 1.2, multiplied by (y) the highest three month average Dilution Ratio for each three-month period ending on the last day of the twelve most recent calendar months, (II) during the existence of a Special Event, but absent the existence of a Class 2 Special Event, the product of (a) the sum of (i) the product of (x) two, multiplied by (y) the average of the Dilution Ratios for each of the twelve most recently ended calendar months, plus (ii) the Dilution Volatility Ratio as at the last day of the most recently ended calendar month, multiplied by (b) the Dilution Horizon Factor as of such date, and (III) during the existence of a Class 2 Special Event, the product of (a) the sum of (i) the product of (x) 2.25, multiplied by (y) the average of the Dilution Ratios for each of the twelve most recently ended calendar months, plus (ii) the Dilution Volatility Ratio as at the last day of the most recently ended calendar month, multiplied by (b) the Dilution Horizon Factor as of such date.

“ Dilution Ratio ” means, as of any date, the ratio (expressed as a percentage) computed for the most recently ended calendar month by dividing (i) the aggregate amount of Originator Receivables which became Diluted Receivables during such calendar month by (ii) the aggregate Outstanding Balance (in each case, at the time of creation) of all Originator Receivables created during the second calendar month immediately preceding such calendar month.

“ Dilution Reserve ” means, for any Receivable Interest on any date, an amount equal to:

DP   x (C + YFR)

1 — DP

where:

“ Dilution Volatility Ratio ” means, as of any date, a ratio (expressed as a percentage) equal to the product of (i) the highest of the Dilution Ratios calculated for each of the twelve most recently ended calendar months minus the average of the Dilution Ratios for each of the twelve most recently ended calendar months, and (ii) a ratio calculated by dividing the highest of the Dilution Ratios calculated for each of the twelve most recently ended calendar months by the average of the Dilution Ratios for each of the twelve most recently ended calendar months.

“ Drawdown Notice ” means a letter in substantially the form of Annex D hereto executed and delivered by the Seller to the Agent, as such form may be amended or restated in accordance with the terms thereof.

“ Eligible Assignee ” means (i) CNAI or any of its Affiliates, (ii) any Person managed by Citibank, CNAI or any of their Affiliates, or (iii) any financial or other institution acceptable to the Agent and approved by the Seller (which approval by the Seller shall not be unreasonably withheld or delayed and shall not be required if an Event of Termination or an Incipient Event of Termination has occurred and is continuing).

“ Eligible Investments ” means book-entry securities entered on the books of the registrar of such securities and held in the name or on behalf of the Agent, negotiable instruments or securities represented by instruments in bearer or registered form (registered in the name of the Agent or its nominee) which evidence:

(a) readily marketable direct obligations of the Government of the United States or any agency or instrumentality thereof or obligations unconditionally guaranteed by the full faith and credit of the United States;

(b) insured demand deposits, time deposits or certificates of deposit of any commercial bank that (i) is a member of the Federal Reserve System, (ii) issues (or the parent of which issues) commercial paper rated, at the time of the investment or contractual commitment to invest therein, as described in clause (d), (iii) is organized under the laws of the United States or any state thereof and (iv) has combined capital and surplus of at least $500,000,000;

(c) repurchase obligations with a term of not more than ten days for underlying securities of the types described in clauses (a) and (b) above entered into with any bank of the type described in clause (b) above;

(d) commercial paper (maturing no later than the Business Day prior to the first Settlement Date following the date of purchase) having, at the time of the investment or contractual commitment to invest therein, the highest short-term rating from each of S&P and Moody’s;

(e) investments in no-load money market funds having a rating from each rating agency rating such fund in its highest investment category (including such funds for which the Agent or any of its Affiliates is investment manager or advisor); and

(f) any other investments agreed upon between the Seller and the Agent.

“ Eligible Receivable ” means, at any time, a Receivable:

(i) the Obligor of which is a resident of the United States (including, without limitation, Puerto Rico), Canada, an Approved OECD Country or an Other Approved Jurisdiction, provided that (A) the aggregate Outstanding Balance of all Eligible Receivables having Obligors which are residents of an Approved OECD Country or an Other Approved Jurisdiction may not exceed an amount equal to two times the aggregate of the Loss Reserves for all Receivable Interests at such time, (B) the aggregate Outstanding Balance of all Eligible Receivables having Obligors which are residents of an Other Approved Jurisdiction may not exceed an amount equal to the aggregate of the Loss Reserves for all Receivable Interests at such time, (C) the aggregate Outstanding Balance of all Eligible Receivables having Obligors which are residents of Japan may not exceed $5,000,000, and (D) with respect to each country which is an Other Approved Jurisdiction, the aggregate Outstanding Balance of all Eligible Receivables having Obligors which are residents of such country may not exceed (1) 5% of the then outstanding Capital of all Receivable Interests, at any time that the sovereign long-term debt rating of such country is at least A by S&P and at least A2 by Moody’s, and (2) 3.3% of the then outstanding Capital of all Receivable Interests, at any time that the sovereign long-term debt rating of such country is not at least A by S&P and at least A2 by Moody’s;

(ii) the Obligor of which is not an Affiliate of any of the parties hereto and is not a government or a governmental subdivision or agency;

(iii) the Obligor of which, at the time of the initial creation of an interest therein under this Agreement, is a Designated Obligor and is not the Obligor of any Defaulted Receivables which in the aggregate constitute 15% or more of the aggregate Outstanding Balance of all Receivables of such Obligor;

(iv) which at the time of the initial creation of an interest therein under this Agreement is not a Defaulted Receivable;

(v) which, according to the Contract related thereto, is required to be paid in full either (A) within not more than 60 days of the original billing date therefor or (B) within more than 60 but no more than 90 days of the original billing date therefor if the aggregate Outstanding Balance of such Receivable and all other Receivables having similar payment terms does not exceed 25% of the then Outstanding Balance of all Pool Receivables at such time;

(vi) which is an obligation representing all or part of the sales price of merchandise, insurance or services within the meaning of Section 3(c)(5) of the Investment Company Act of 1940, as amended, and the nature of which is such that its purchase with the proceeds of notes would constitute a “current transaction” within the meaning of Section 3(a)(3) of the Securities Act of 1933, as amended;

(vii) which is an “account” within the meaning of Article 9 of the UCC of the applicable jurisdictions governing the perfection of the interest created by a Receivable Interest;

(viii) which is denominated and payable only in United States dollars in the United States;

(ix) which arises under a Contract which, together with such Receivable, is in full force and effect and constitutes the legal, valid and binding obligation of the Obligor of such Receivable and is not subject to any Adverse Claim or any dispute, offset, counterclaim or defense whatsoever (except the potential discharge in bankruptcy of such Obligor);

(x) which, together with the Contract related thereto, does not contravene in any material respect any laws, rules or regulations applicable thereto (including, without limitation, laws, rules and regulations relating to usury, consumer protection, truth in lending, fair credit billing, fair credit reporting, equal credit opportunity, fair debt collection practices and privacy) and with respect to which none of the Seller, the Originators or the Obligor is in violation of any such law, rule or regulation in any material respect;

(xi) which arises under a Contract which (A) does not require the Obligor thereunder to consent to the transfer, sale or assignment of the rights and duties of the Seller or the relevant Originator thereunder and (B) does not contain a confidentiality provision that purports to restrict the ability of the Agent, the Investors or the Banks to exercise their rights under this Agreement, including, without limitation, their right to review the Contract;

(xii) which was generated in the ordinary course of the relevant Originator’s business;

(xiii) which, at the time of the initial creation of an interest therein under this Agreement, has not been extended, rewritten or otherwise modified from the original terms thereof;

(xiv) which (A) satisfies all applicable requirements of the Credit and Collection Policy and (B) complies with such other criteria and requirements (other than those relating to the collectibility of such Receivable) as the Agent may from time to time specify to the Seller upon 30 days’ notice;

(xv) as to which, at or prior to the time of the initial creation of an interest therein under this Agreement, the Agent has not notified the Seller that such Receivable (or class of Receivables) is no longer acceptable for purchase by CAFCO and the Banks hereunder; and

(xvi) which, if it was originated by either of Ferro Color or FPL, was originated on or after April 1, 2008.

“ E-Mail Seller Report ” has the meaning specified in Section 6.02(g).

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated and rulings issued thereunder.

“ Eurocurrency Liabilities ” has the meaning assigned to that term in Regulation D of the Board of Governors of the Federal Reserve System, as in effect from time to time.

“ Eurodollar Rate ” means, for any Fixed Period, an interest rate per annum equal to the rate per annum at which deposits in U.S. dollars are offered by the principal office of Citibank in London, England to prime banks in the London interbank market at 11:00 A.M. (London Time) two Business Days before the first day of such Fixed Period in an amount substantially equal to the Capital associated with such Fixed Period on such first day and for a period equal to such Fixed Period.

“ Eurodollar Rate Reserve Percentage ” of any Investor or Bank for any Fixed Period in respect of which Yield is computed by reference to the Eurodollar Rate means the reserve percentage applicable two Business Days before the first day of such Fixed Period under regulations issued from time to time by the Board of Governors of the Federal Reserve System (or any successor) (or if more than one such percentage shall be applicable, the daily average of such percentages for those days in such Fixed Period during which any such percentage shall be so applicable) for determining the maximum reserve requirement (including, without limitation, any emergency, supplemental or other marginal reserve requirement) for such Investor or Bank with respect to liabilities or assets consisting of or including Eurocurrency Liabilities (or with respect to any other category of liabilities that includes deposits by reference to which the interest rate on Eurocurrency Liabilities is determined) having a term equal to such Fixed Period.

“ Event of Termination ” has the meaning specified in Section 7.01.

“ Excess Interest ” means, in respect of Cash Secured Advances at any time, the excess of (i) the aggregate unpaid accrued interest on the Cash Secured Advances at such time over (ii) the aggregate interest and dividends received by the Agent in respect of the Term-Out Bank Collateral and available for withdrawal from the Collateral Advance Account at such time.

“ Existing RPA ” has the meaning specified in the preliminary statements to this Agreement.

“ FPL ” means Ferro Pfanstiehl Laboratories, Inc., a Delaware corporation.

“ Facility Termination Date ” means the earliest of (i) June 2, 2009 or (ii) the date determined pursuant to Section 7.01 or (iii) the date the Purchase Limit reduces to zero pursuant to Section 2.01(b).

“ Federal Funds Rate ” means, for any period, a fluctuating interest rate per annum equal for each day during such period to the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published for any day which is a Business Day, the average of the quotations for such day on such transactions received by the Agent from three Federal funds brokers of recognized standing selected by it.

“ Fee Agreement ” has the meaning specified in Section 2.05(b).

“ Fees ” has the meaning specified in Section 2.05(b).

“ Ferro ” means Ferro Corporation, an Ohio corporation.

“ Ferro Color ” means Ferro Color & Glass Corporation, a Pennsylvania corporation.

“ Fixed Period ” means, with respect to any Receivable Interest:

(a) in the case of any Fixed Period in respect of which Yield is computed by reference to the Investor Rate, each successive period commencing on each CP Fixed Period Date for such Receivable Interest and ending on the next succeeding CP Fixed Period Date for such Receivable Interest; and

(b) in the case of any Fixed Period in respect of which Yield is computed by reference to the Assignee Rate, each successive period of from one to and including 29 days, or a period of one, two or three months, as the Seller shall select and the Agent may approve on notice by the Seller received by the Agent (including notice by telephone, confirmed in writing) not later than 11:00 A.M. (New York City time) on (x) the day which occurs three Business Days before the first day of such Fixed Period (in the case of Fixed Periods in respect of which Yield is computed by reference to the Eurodollar Rate) or (y) the first day of such Fixed Period (in the case of Fixed Periods in respect of which Yield is computed by reference to the Alternate Base Rate), each such Fixed Period for such Receivable Interest to commence on the last day of the immediately preceding Fixed Period for such Receivable Interest (or, if there is no such Fixed Period, on the date of purchase of such Receivable Interest), except that if the Agent shall not have received such notice, or the Agent and the Seller shall not have so mutually agreed, before 11:00 A.M. (New York City time) on such day, such Fixed Period shall be one day;

provided , however , that:

(i) any Fixed Period (other than of one day) which would otherwise end on a day which is not a Business Day shall be extended to the next succeeding Business Day ( provided , however , if Yield in respect of such Fixed Period is computed by reference to the Eurodollar Rate, and such Fixed Period would otherwise end on a day which is not a Business Day, and there is no subsequent Business Day in the same calendar month as such day, such Fixed Period shall end on the next preceding Business Day);

(ii) in the case of any Fixed Period of one day, (A) if such Fixed Period is the initial Fixed Period for a Receivable Interest, such Fixed Period shall be the day of the purchase of such Receivable Interest; (B) any subsequently occurring Fixed Period which is one day shall, if the immediately preceding Fixed Period is more than one day, be the last day of such immediately preceding Fixed Period and, if the immediately preceding Fixed Period is one day, be the day next following such immediately preceding Fixed Period; and (C) if such Fixed Period occurs on a day immediately preceding a day which is not a Business Day, such Fixed Period shall be extended to the next succeeding Business Day; and

(iii) in the case of any Fixed Period for any Receivable Interest which commences before the Termination Date for such Receivable Interest and would otherwise end on a date occurring after such Termination Date, such Fixed Period shall end on such Termination Date and the duration of each Fixed Period which commences on or after the Termination Date for such Receivable Interest shall be of such duration (including, without limitation, one day) as shall be selected by the Agent or, in the absence of any such selection, each period of thirty days from the last day of the immediately preceding Fixed Period.

“ Incipient Event of Termination ” means an event that but for notice or lapse of time or both would constitute an Event of Termination.

“ Investor ” means CAFCO and all other owners by assignment or otherwise of a Receivable Interest originally purchased by CAFCO and, to the extent of the undivided interests so purchased, shall include any participants.

“ Investor Rate ” for any Fixed Period for any Receivable Interest means the per annum rate equivalent to the weighted average of the per annum rates paid or payable by CAFCO from time to time as interest on or otherwise (by means of interest rate hedges or otherwise) in respect of those promissory notes issued by CAFCO that are allocated, in whole or in part, by the Agent (on behalf of CAFCO) to fund the purchase or maintenance of such Receivable Interest during such Fixed Period as determined by the Agent (on behalf of CAFCO) and reported to the Seller and, if the Collection Agent is not the Seller, the Collection Agent, which rates shall reflect and give effect to the commissions of placement agents and dealers in respect of such promissory notes, to the extent such commissions are allocated, in whole or in part, to such promissory notes by the Agent (on behalf of CAFCO); provided , however , that if any component of such rate is a discount rate, in calculating the “Investor Rate” for such Fixed Period the Agent shall for such component use the rate resulting from converting such discount rate to an interest bearing equivalent rate per annum.

“ Liquidation Day ” means, for any Receivable Interest, (i) each day during a Fixed Period for such Receivable Interest on which the conditions set forth in Section 3.02 are not satisfied, and (ii) each day which occurs on or after the Termination Date for such Receivable Interest.

“ Liquidation Fee ” means, for (i) any Fixed Period during which a Liquidation Day occurs or (ii) any Fixed Period for which Yield is computed by reference to the Investor Rate and a reduction of Capital is made for any reason (x) in an amount greater than $25,000,000 on a Settlement Date or (y) in any amount on any day other than a Settlement Date or (iii) any Fixed Period for which Yield is computed by reference to the Eurodollar Rate and a reduction of Capital is made for any reason on any day other than the last day of such Fixed Period, the amount, if any, by which (A) the additional Yield (calculated without taking into account any Liquidation Fee or any shortened duration of such Fixed Period pursuant to clause (iii) of the definition thereof) which would have accrued during such Fixed Period on the reductions of Capital of the Receivable Interest relating to such Fixed Period had such reductions remained as Capital, exceeds (B) the income, if any, received by the Investors or the Banks which hold such Receivable Interest from the investment of the proceeds of such reductions of Capital.

“ Lock-Box Account ” means an account maintained at a Lock-Box Bank for the purpose of receiving Collections.

“ Lock-Box Agreement ” means an agreement, in substantially the form of Annex B.

“ Lock-Box Bank ” means any of the banks holding one or more Lock-Box Accounts.

“ Loss Horizon Factor ” means, as of any date, a ratio computed by dividing (i) the aggregate Outstanding Balance (in each case, at the time of creation) of all Originator Receivables created by the Originators during the four most recently ended calendar months by (ii) the Outstanding Balance of Originator Receivables (other than Defaulted Receivables) as at the last day of the most recently ended calendar month.

“ Loss Percentage ” means, as of any date, (I) absent the existence of a Class 2 Special Event, the greatest of (i) the product of (A) two multiplied by (B) the Loss Horizon Factor as of the last day of the most recently ended calendar month multiplied by (C) the highest of the Loss Ratios for the twelve most recently ended calendar months, (ii) four times the Normal Concentration Limit and (iii) 13%, and (II) during the existence of a Class 2 Special Event, the greatest of (i) the product of (A) 2.25 multiplied by (B) the Loss Horizon Factor as of the last day of the most recently ended calendar month multiplied by (C) the highest of the Loss Ratios for the twelve most recently ended calendar months, (ii) five times the Normal Concentration Limit and (iii) 16.25%.

“ Loss Ratio ” means, as of any date, the average of the ratios (each expressed as a percentage) for each of the three most recently ended calendar months computed for each such month by dividing (i) the sum of the aggregate Outstanding Balance of Originator Receivables which were 91-120 days past due (or otherwise would have been classified during such month as Defaulted Receivables in accordance with clause (ii) or (iii) of the definition of “Defaulted Receivables”) as at the last day of such month plus (without duplication) write-offs during such month, by (ii) the aggregate Outstanding Balance (in each case, at the time of creation) of Originator Receivables created during the fourth preceding month.

“ Loss Reserve ” means, for any Receivable Interest on any date, an amount equal to:

LP   x (C + YFR)

1 — LP

where:

“ Loss-to-Liquidation Ratio ” means the ratio (expressed as a percentage) computed as of the last day of each calendar month by dividing (i) the aggregate Outstanding Balance of all Originator Receivables written off by the Originators or the Seller, or which should have been written off by the Originators or the Seller in accordance with the Credit and Collection Policy, during the twelve calendar month period ending on such last day by (ii) the aggregate amount of Collections of Originator Receivables actually received during such period.

“ Monthly Report ” means a report in substantially the form of Annex A-1 hereto and containing such additional information as the Agent may reasonably request from time to time, furnished by the Collection Agent to the Agent pursuant to Section 6.02(g).

“ Moody’s ” means Moody’s Investors Service, Inc.

“ Net Receivables Pool Balance ” means at any time the Outstanding Balance of Eligible Receivables then in the Receivables Pool reduced by the sum of (i) the Outstanding Balance of such Eligible Receivables that are then Defaulted Receivables, (ii) the aggregate amount by which the Outstanding Balance of Eligible Receivables (other than Defaulted Receivables) of each Obligor then in the Receivables Pool exceeds the product of (A) the Concentration Limit for such Obligor multiplied by (B) the aggregate outstanding Capital of all Receivable Interests, (iii) the aggregate amount of Collections on hand at such time for payment on account of any Eligible Receivables, the Obligor of which has not been identified, (iv) the aggregate Outstanding Balance of all Eligible Receivables in respect of which any credit memo issued by an Originator or the Seller is outstanding at such time to the extent deemed Collections have not been paid pursuant to Section 2.04(f) and (v) the aggregate amount of deposits received by the Originators and the Seller from any Obligors with respect to Eligible Receivables.

“ Non-Investment Grade Event ” means any of the long term public senior unsecured non-credit-enhanced debt securities of Ferro are rated below BBB- by S&P or Baa3 by Moody’s, or if Ferro does not have long term public senior unsecured non-credit-enhanced debt ratings from both S&P and Moody’s, Ferro is judged by the Agent, in its sole discretion, to be of credit quality below (with respect to each missing rating) BBB- by S&P or Baa3 by Moody’s.

“ Obligor ” means a Person obligated to make payments pursuant to a Contract.

“ Original RPA ” has the meaning specified in the preliminary statements to this Agreement.

“ Originator Purchase Agreement ” means the Amended and Restated Purchase and Contribution Agreement dated as of April 1, 2008 between Ferro, as seller, and the Seller, as purchaser, as the same has been or may be amended, modified or restated from time to time.

“ Originator Receivable ” means the indebtedness of any Obligor resulting from the provision or sale of merchandise, insurance or services by an Originator under a Contract, and includes the right to payment of any interest or finance charges and other obligations of such Obligor with respect thereto.

“ Originators ” means Ferro, Ferro Color and FPL.

“ Other Approved Jurisdiction ” means each of the countries listed on Schedule III-B hereto, as such Schedule may be amended from time to time upon request of the Seller or the Collection Agent, with prior written approval of the Agent; provided , however , that at any time that the sovereign long-term debt rating of any country listed on such Schedule falls below BBB- by S&P or below Baa3 by Moody’s, such country will cease to be an Other Approved Jurisdiction. Additionally, the Agent may remove countries from such Schedule at any time, as it determines in its sole discretion, upon prior written notice to the Seller and the Collection Agent.

“ Other Companies ” means the Originators and all of their Subsidiaries except the Seller.

“ Outstanding Balance ” of any Receivable at any time means the then outstanding principal balance thereof.

“ Percentage ” of any Bank means, (a) with respect to Citibank, the percentage set forth on the signature page to this Agreement, or such amount as reduced or increased by any Assignment and Acceptance entered into with an Eligible Assignee, or (b) with respect to a Bank that has entered into an Assignment and Acceptance, the amount set forth therein as such Bank’s Percentage, or such amount as reduced or increased by an Assignment and Acceptance entered into between such Bank and an Eligible Assignee.

“ Person ” means an individual, partnership, corporation (including a business trust), limited liability company, joint stock company, trust, unincorporated association, joint venture or other entity, or a government or any political subdivision or agency thereof.

“ Pool Non-compliance Date ” means any day on which the Net Receivables Pool Balance as shown in the most recent Monthly Report or (following a Non-Investment Grade Event but prior to a BB Downgrade Event) the most recent Weekly Report or (following a BB Downgrade Event other than the 2005 Downgrade Event and the 2006 Downgrade Events) the most recent Daily Report is less than the Required Net Receivables Pool Balance.

“ Pool Receivable ” means a Receivable in the Receivables Pool.

“ Preceding Purchase Agreement ” means each of the Originator Purchase Agreement and the Purchase Agreement.

“ Purchase Agreement ” means the Purchase Agreement dated as of April 1, 2008, between Ferro Color and FPL, as sellers, and Ferro, as purchaser, as the same may be amended, modified or restated from time to time.

“ Purchase Limit ” means $100,000,000, as such amount may be reduced pursuant to Section 2.01(b). References to the unused portion of the Purchase Limit shall mean, at any time, the Purchase Limit, as then reduced pursuant to Section 2.01(b), minus the then outstanding Capital of Receivable Interests under this Agreement.

“ Purchaser Collections ” means, as of any Deposit Date, that portion of the Collections deposited to the Lock-Box Accounts on such date or received by the Collection Agent on such date equal to the product of (i) the Allocation Percentage on such date times (ii) the aggregate amount of such Collections.

“ Receivable ” means any Originator Receivable which has been acquired by the Seller from Ferro by purchase or by capital contribution pursuant to the Originator Purchase Agreement.

“ Receivable Interest ” means, at any time, an undivided percentage ownership interest in (i) all then outstanding Pool Receivables arising prior to the time of the most recent computation or recomputation of such undivided percentage interest pursuant to Section 2.03, (ii) all Related Security with respect to such Pool Receivables, and (iii) all Collections with respect to, and other proceeds of, such Pool Receivables. Such undivided percentage interest shall be computed as

C + YFR + LR + DR

NRPB

where:

Each Receivable Interest shall be determined from time to time pursuant to the provisions of Section 2.03.

“ Receivables Pool ” means at any time the aggregation of each then outstanding Receivable in respect of which the Obligor is a Designated Obligor at such time or was a Designated Obligor on the date of the initial creation of an interest in such Receivable under this Agreement.

“ Related Security ” means with respect to any Receivable

(i) all of the Seller’s interest in any merchandise (including returned merchandise) relating to any sale giving rise to such Receivable;

(ii) all security interests or liens and property subject thereto from time to time purporting to secure payment of such Receivable, whether pursuant to the Contract related to such Receivable or otherwise, together with all financing statements filed against an Obligor describing any collateral securing such Receivable;

(iii) all guaranties, insurance and other agreements or arrangements of whatever character from time to time supporting or securing payment of such Receivable whether pursuant to the Contract related to such Receivable or otherwise; and

(iv) the Contract and all other books, records and other information (including, without limitation, computer programs, tapes, discs, punch cards, data processing software and related property and rights) relating to such Receivable and the related Obligor.

“ Required Net Receivables Pool Balance ” means, as of any day, the sum of (i) the aggregate Reserves for all Receivable Interests calculated as of such day plus (ii) the aggregate outstanding Capital for all Receivable Interests as of such day. For purposes of such calculation, Capital shall be reduced by the aggregate amount of funds then held in the Cash Collateral Account, and (to the extent applicable) the Reserves shall be computed on such reduced Capital.

“ Reserves ” means, with respect to any Receivable Interest as of any day, the sum of the Yield and Fee Reserve, the Loss Reserve and the Dilution Reserve for such Receivable Interest as of such day.

“ Revolving Period ” means the period beginning on the date of the initial purchase hereunder and terminating at the close of business on the Business Day immediately preceding the date on which the Termination Date shall have occurred for all Receivable Interests.

“ S&P ” means Standard & Poor’s Rating Services, a division of McGraw-Hill Companies, Inc.

“ SEC ” means the Securities and Exchange Commission.

“ Seller Collections ” means, as of any Deposit Date, that portion of the Collections deposited to the Lock-Box Accounts on such date or received by the Collection Agent on such date equal to the product of (i) 100% minus the Allocation Percentage on such date times (ii) the aggregate amount of such Collections.

“ Seller Report ” means a Monthly Report, a Weekly Report, or a Daily Report.

“ Settlement Date ” for any Receivable Interest means the last day of each Fixed Period for such Receivable Interest; provided , however , that if Yield with respect to such Receivable Interest is computed by reference to the Investor Rate and no Liquidation Day exists on the last day of a Fixed Period for such Receivable Interest, the Settlement Date for such Receivable Interest for such Fixed Period shall be the second Business Day after the last day of such Fixed Period.

“ Special Event ” means any of the long term public senior unsecured non-credit-enhanced debt securities of Ferro are rated below BBB by S&P (if rated by S&P) or Baa2 by Moody’s (if rated by Moody’s), or if Ferro does not have long term public senior unsecured non-credit-enhanced debt ratings from both S&P and Moody’s, Ferro is judged by the Agent, in its sole discretion, to be of credit quality below (with respect to each missing rating) BBB by S&P or Baa2 by Moody’s.

“ State ” means one of the fifty states of the United States or the District of Columbia.

“ Subsidiary ” means any corporation or other entity of which securities having ordinary voting power to elect a majority of the board of directors or other persons performing similar functions are at the time directly or indirectly owned by the Seller or an Originator, as the case may be, or one or more Subsidiaries, or by the Seller or an Originator, as the case may be, and one or more Subsidiaries.

“ Tangible Net Worth ” means at any time the excess of (i) the sum of (A) the product of (x) 100% minus the Discount (as such term is defined in the Originator Purchase Agreement) multiplied by (y) the Outstanding Balance of all Receivables other than Defaulted Receivables plus (B) cash and cash equivalents of the Seller plus (C) the outstanding principal amount of Purchaser Loans (as such term is defined in the Originator Purchase Agreement), minus (ii) the sum of (A) Capital plus (B) the Deferred Purchase Price.

“ Term Period ” means, for any Bank, the period commencing on the Cash Secured Advance Commencement Date, if any, for such Bank and ending on the first day on which the Termination Date for all Receivable Interests held by such Bank has occurred.

“ Term-Out Bank ” means any Bank for which the Term Period has commenced.

“ Term-Out Bank Collateral ” has the meaning specified in Section 2.14(b).

“ Term-Out Bank Purchase Date ” means, for any Term-Out Bank, the Commitment Termination Date for such Bank determined pursuant to clause (a) of the definition thereof, without giving effect to the final proviso at the end of the definition of Commitment Termination Date.

“ Termination Date ” for any Receivable Interest means (i) in the case of a Receivable Interest owned by an Investor, the earlier of (a) the Business Day which the Seller or the Agent so designates by notice to the other at least one Business Day in advance for such Receivable Interest and (b) the Facility Termination Date and (ii) in the case of a Receivable Interest owned by a Bank, the earlier of (a) the Business Day which the Seller so designates by notice to the Agent at least one Business Day in advance for such Receivable Interest and (b) the Commitment Termination Date.

“ Transaction Document ” means any of this Agreement, the Purchase Agreement, the Originator Purchase Agreement, the Lock-Box Agreements, the Cash Collateral Agreement, the Fee Agreement, the Collateral Advance Account Agreement, all amendments to any of the foregoing and all other agreements and documents delivered and/or related hereto or thereto.

“ UCC ” means the Uniform Commercial Code as from time to time in effect in the specified jurisdiction.

“ Week ” means each calendar week beginning on Saturday and ending on (and including) the following Friday.

“ Weekly Report ” means a report in substantially the form of Annex A-2 hereto and containing such additional information as the Agent may reasonably request from time to time, furnished by the Collection Agent to the Agent pursuant to Section 6.02(h), following the occurrence of a Non-Investment Grade Event (other than the 2005 Downgrade Event or the 2006 Downgrade Events).

“ Yield ” means:

(i) for each Receivable Interest for any Fixed Period to the extent CAFCO will be funding such Receivable Interest through the issuance of commercial paper or other promissory notes,

IR x C x ED + LF

360

(ii) for each Receivable Interest for any Fixed Period to the extent (x) the Investors will not be funding such Receivable Interest through the issuance of commercial paper or other promissory notes, or (y) an Investor other than CAFCO will be funding such Receivable Interest,

AR x C x ED + LF

360

where:

provided that no provision of this Agreement shall require the payment or permit the collection of Yield in excess of the maximum permitted by applicable law; and provided further that Yield for any Receivable Interest shall not be considered paid by any distribution to the extent that at any time all or a portion of such distribution is rescinded or must otherwise be returned for any reason.

“ Yield and Fee Reserve ” means, for any Receivable Interest on any date, an amount equal to

(C x YFRP) + AUYF

where:

“ Yield and Fee Reserve Percentage ” means, on any date, a percentage equal to

[(AER x 1.5) + AM + PF + CAF] x AVGM

360

where:

SECTION 1.02. Other Terms . All accounting terms not specifically defined herein shall be construed in accordance with generally accepted accounting principles. All terms used in Article 9 of the UCC in the State of New York, and not specifically defined herein, are used herein as defined in such Article 9.

ARTICLE II

AMOUNTS AND TERMS OF THE PURCHASES

SECTION 2.01. Purchase Facility . (a) On the terms and conditions hereinafter set forth, CAFCO may, in its sole discretion, and the Banks shall, ratably in accordance with their respective Bank Commitments, purchase Receivable Interests from the Seller from time to time during the period from the date hereof to the Facility Termination Date (in the case of CAFCO) and to the Commitment Termination Date (in the case of the Banks). Under no circumstances shall CAFCO make any such purchase, or the Banks be obligated to make any such purchase, if, after giving effect to such purchase, the aggregate outstanding Capital of Receivable Interests would exceed the Purchase Limit.

(b) The Seller may at any time, upon at least five Business Days’ notice to the Agent, terminate the facility provided for in this Agreement in whole or, from time to time, reduce in part the unused portion of the Purchase Limit; provided that each partial reduction shall be in the amount of at least $5,000,000 or an integral multiple thereof.

(c) Until the Agent gives the Seller the notice provided in Section 3.02(c)(iii), the Agent, on behalf of the Investors which own Receivable Interests, may have the Collections attributable to such Receivable Interests automatically reinvested pursuant to Section 2.04 in additional undivided percentage interests in the Pool Receivables by making an appropriate readjustment of such Receivable Interests. The Agent, on behalf of the Banks which own Receivable Interests, shall have the Collections attributable to such Receivable Interests automatically reinvested pursuant to Section 2.04 in additional undivided percentage interests in the Pool Receivables by making an appropriate readjustment of such Receivable Interests.

(d) At least three Business Days prior to the Cash Secured Advance Commencement Date for any Bank, the Seller shall notify such Bank if the Seller wishes such Bank to make the advances described in this Section. Following such notice, on the Cash Secured Advance Commencement Date for such Bank, such Bank shall, and agrees to, make an advance to the Seller in an amount equal to the excess of (i) such Bank’s Bank Commitment over (ii) the outstanding Capital of all Receivable Interests owned by such Bank (after giving effect to any purchase made by such Bank on or prior to such Cash Secured Advance Commencement Date pursuant to this Agreement or pursuant to the Asset Purchase Agreement to which it is a party) on the Term-Out Bank Purchase Date for such Bank, and such Bank shall make such advance by causing an amount equal to such advance to be deposited in same day funds into the Collateral Advance Account.

SECTION 2.02. Making Purchases . (a)  Each purchase by CAFCO or the Banks shall be made on at least three Business Days’ notice in the form of a Drawdown Notice from the Seller to the Agent. Each such Drawdown Notice of a purchase shall specify (i) the amount requested to be paid to the Seller (such amount, which shall not be less than $2,000,000, being referred to herein as the initial “Capital” of the Receivable Interest then being purchased) and (ii) the date of such purchase (which shall be a Business Day). The Agent shall promptly thereafter notify the Seller whether CAFCO has determined to make a purchase and, if so, whether all of the terms specified by the Seller are acceptable to CAFCO.

If CAFCO has determined not to make a proposed purchase, the Agent shall promptly send notice of the proposed purchase to all of the Banks concurrently by telecopier, telex or cable specifying the date of such purchase, each Bank’s Percentage multiplied by the aggregate amount of Capital of Receivable Interest being purchased, whether the Yield for the Fixed Period for such Receivable Interest is calculated based on the Eurodollar Rate (which may be selected only if such notice is given at least three Business Days prior to the purchase date) or the Alternate Base Rate, and the duration of the Fixed Period for such Receivable Interest; provided , however , that during the Term Period for any Bank, such Bank shall, on the date of such purchase, instruct the Agent to make available to the Seller at the account set forth in the Drawdown Notice such Bank’s ratable share of the amount of Capital of the Receivable Interest being acquired by such Bank out of the funds available therefor in the Collateral Advance Account.

(b) On the date of each such purchase of a Receivable Interest, CAFCO or the Banks, as the case may be, shall, upon satisfaction of the applicable conditions set forth in Article III, make available to the Seller in same day funds an amount equal to the initial Capital of such Receivable Interest, at the account set forth in the Drawdown Notice for such purchase; provided , however , if such purchase is being made by the Banks following the designation by the Agent of a Termination Date for a Receivable Interest owned by an Investor pursuant to clause (i)(a) of the definition of Termination Date and any Capital of such Receivable Interest is outstanding on such date of purchase, the Seller hereby directs the Banks to pay the proceeds of such purchase (to the extent of the outstanding Capital and accrued Yield on such Receivable Interest of the Investor) to the Agent’s Account, for application to the reduction of the outstanding Capital and accrued Yield on such Receivable Interest of the Investor; provided , further , however , that during the Term Period for any Bank, after receipt by the Agent of the instruction from such Bank referred to in the proviso to the last sentence of Section 2.02(a) and upon fulfillment of the applicable conditions set forth in Article III, the Agent shall make available to the Seller at the account set forth in the Drawdown Notice such Bank’s ratable share of such purchase, solely out of the funds available therefor in the Collateral Advance Account, and upon such deposit such Bank will be deemed to have paid to the Seller such Bank’s ratable share of such Bank’s amount of the Capital of the Receivable Interest being acquired for all purposes of this Agreement.

(c) Effective on the date of each purchase pursuant to this Section 2.02 and each reinvestment pursuant to Section 2.04, the Seller hereby sells and assigns to the Agent, for the benefit of the parties making such purchase, an undivided percentage ownership interest, to the extent of the Receivable Interest then being purchased, in each Pool Receivable then existing and in the Related Security and Collections with respect thereto.

(d) In addition to the transfer of ownership to Receivable Interests stipulated above, the Seller, subject to the satisfaction of the conditions precedent set out in this Agreement, hereby assigns by way of a German law assignment ( Abtretung ) within the meaning of Section 398 German Civil Code ( Bürgerliches Gesetzbuch ) to the Agent for the benefit of CAFCO Receivable Interests in all Receivables (whether now existing or hereafter arising) acquired by the Seller pursuant to the Originator Purchase Agreement and owed by an Obligor located in Germany (the “ German Obligor Receivables ”). The Agent accepts such assignment. The assignment of the Receivable Interests shall include all ancillary rights, priority rights as well as all other rights attached to the German Obligor Receivables

(e) Notwithstanding the foregoing, (i) CAFCO shall not make purchases under this Section 2.02 during the Term Period for any Bank in an amount which would exceed the Purchase Limit minus the aggregate Bank Commitments of the Term-Out Banks, and (ii) a Bank shall not be obligated to make purchases under this Section 2.02 at any time in an amount which would exceed such Bank’s Bank Commitment less such Bank’s ratable share of the aggregate outstanding Capital held by CAFCO (whether or not any portion thereof has been assigned under the Asset Purchase Agreement), after giving effect to any reductions of the Capital held by CAFCO to be made on the date of such purchase (whether from the distribution of Collections or from the proceeds of purchases by the Banks). Each Bank’s obligation shall be several, such that the failure of any Bank to make available to the Seller any funds in connection with any purchase shall not relieve any other Bank of its obligation, if any, hereunder to make funds available on the date of such purchase, and no Bank shall be responsible for the failure of any other Bank to make funds available in connection with any purchase.

SECTION 2.03. Receivable Interest Computation . Each Receivable Interest shall be initially computed on its date of purchase. Thereafter until the Termination Date for such Receivable Interest, such Receivable Interest shall be automatically recomputed (or deemed to be recomputed) on each day other than a Liquidation Day. Any Receivable Interest, as computed (or deemed recomputed) as of the day immediately preceding the Termination Date for such Receivable Interest, shall thereafter remain constant. Such Receivable Interest shall become zero when Capital thereof and Yield thereon shall have been paid in full, and all Fees and other amounts owed by the Seller hereunder to the Investors, the Banks or the Agent are paid and the Collection Agent shall have received the accrued Collection Agent Fee thereon.

SECTION 2.04. Settlement Procedures . (a)  Collection of the Pool Receivables shall be administered by a Collection Agent, in accordance with the terms of Article VI of this Agreement. The Seller shall provide to the Collection Agent (if other than the Seller) on a timely basis all information needed for such administration, including notice of the occurrence of any Liquidation Day and current computations of each Receivable Interest.

(b) So long as a BB Downgrade Event (other than the 2005 Downgrade Event and the 2006 Downgrade Events) shall not have occurred the Collection Agent shall, on each day on which Collections of Pool Receivables are received by it:

(i) with respect to each Receivable Interest, set aside and hold in trust (and, at the request of the Agent, segregate) for the Investors or the Banks that hold such Receivable Interest, out of the percentage of such Collections represented by such Receivable Interest, an amount equal to the Yield, Fees and Collection Agent Fee (and during the Term Period, an amount equal to the Excess Interest in respect of all Cash Secured Advances) accrued through such day for such Receivable Interest and not previously set aside;

(ii) with respect to each Receivable Interest, if such day is not a Liquidation Day for such Receivable Interest, reinvest with the Seller on behalf of the Investors or the Banks that hold such Receivable Interest the percentage of such Collections represented by such Receivable Interest, to the extent representing a return of Capital, by recomputation of such Receivable Interest pursuant to Section 2.03;

(iii) if such day is a Liquidation Day for any one or more Receivable Interests, set aside and hold in trust (and, at the request of the Agent, segregate) for the Investors or the Banks that hold such Receivable Interests (x) if such day is a Liquidation Day for less than all of the Receivable Interests, the percentage of such Collections represented by such Receivable Interests, and (y) if such day is a Liquidation Day for all of the Receivable Interests, all of the remaining Collections (but not in excess of the Capital of such Receivable Interests); provided that if amounts are set aside and held in trust on any Liquidation Day occurring prior to the Termination Date, and thereafter prior to the Settlement Date for such Fixed Period the conditions set forth in Section 3.02 are satisfied or waived by the Agent, such previously set aside amounts shall, to the extent representing a return of Capital, be reinvested in accordance with the preceding subsection (ii) on the day of such subsequent satisfaction or waiver of conditions; and

(iv) during such times as amounts are required to be reinvested in accordance with the foregoing subsection (ii) or the proviso to subsection (iii), release to the Seller for its own account any Collections in excess both of such amounts and of the amounts that are required to be set aside pursuant to subsection (i) above.

(c) If a BB Downgrade Event (other than the 2005 Downgrade Event and the 2006 Downgrade Events) shall have occurred and be continuing, the Collection Agent shall comply with the following:

(i) If the Collection Agent shall fail to deliver the Daily Report on any Deposit Date during the Revolving Period, the Collection Agent shall not be permitted to withdraw any amounts from the Lock-Box Accounts on such date or any date thereafter unless and until the Collection Agent shall be in compliance with Section 6.02(h) (but subject to the right of the Agent to prohibit withdrawals by the Collection Agent from the Lock-Box Accounts in accordance with the Lock-Box Agreements);

(ii) On the first Business Day following each Deposit Date during the Revolving Period, following delivery of the Daily Report to the Agent, if the Daily Report for such date shows that a Cure Period shall have occurred and be continuing, the Collection Agent shall, in the following order:

(iii) On the first Business Day following each Deposit Date during the Revolving Period, following delivery of the Daily Report to the Agent, if the Daily Report for such date shows that a Cure Period shall have occurred and be continuing, the Collection Agent shall, in the following order:

(iv) On the first Business Day following each Deposit Date during the Amortization Period, the Collection Agent shall, by no later than 11:00 A.M. (New York City time), remit to the Agent’s Account all Collections in the Lock-Box Accounts and all Collections of Pool Receivables which the Collection Agent received on such Deposit Date.

(d) The Collection Agent shall deposit into the Agent’s Account, on the Settlement Date for each Receivable Interest, (x) prior to the occurrence of a Liquidation Day, Collections held for the Investors or the Banks that relate to such Receivable Interest pursuant to Sections 2.04(b), 2.04(c)(ii)(B) or 2.04(c)(iii)(B) and (y) following the occurrence of a Liquidation Day, all Collections. The Collection Agent shall pay to itself on each Settlement Date which is not a Liquidation Day Collections set aside with respect to each Receivable Interest on account of accrued Collection Agent Fee. On any Business Day on which funds are on deposit in the Cash Collateral Account, the Collection Agent (i) shall, upon written notice from the Agent, and may (if the funds in the Cash Collateral Account exceed $10,000,000), upon written notice to the Agent, remit such funds from the Cash Collateral Account to the Agent’s Account or (ii) may, following delivery of the Daily Report to the Agent, withdraw from the Cash Collateral Account and remit to the Seller all or a portion of the funds in the Cash Collateral Account; provided that such Daily Report shall state that, after taking account of the proposed withdrawal, the Net Receivables Pool Balance on such day will be equal to or greater than the Required Net Receivables Pool Balance, and such Daily Report shall set forth the calculation supporting such statement.

(e) Upon receipt of funds deposited into the Agent’s Account, the Agent shall distribute them as follows:

(i) if such distribution occurs on a day that is not a Liquidation Day, first to the Investors, the Banks and, during any Term-Out Period, the Term-Out Banks that hold the relevant Receivable Interest and to the Agent in ratable payment in full of all accrued Yield and Fees and remaining unpaid accrued interest in respect of all Cash Secured Advances (pursuant to the last sentence of Section 2.12); provided , that if such distribution related to Collections remitted from the Cash Collateral Account, such distribution shall be paid to the Investors and the Banks that hold the Receivable Interest in respect thereof, in reduction of Capital.

(ii) if such distribution occurs on a Liquidation Day, first to the Investors or the Banks and/or Term-Out Banks that hold the relevant Receivable Interest and to the Agent in payment in full of all accrued Yield and Fees and interest in respect of all Cash Secured Advances, second to such Investors or Banks in reduction to zero of all Capital, third to the Term-Out Banks in reduction to zero of the principal amount of all Cash Secured Advances remaining after application of the Term-Out Bank Collateral in accordance with Section 2.14(d), and fourth to the Investors, Banks, Term-Out Banks or the Agent in payment of any other amounts owed by the Seller hereunder, and fourth to the Collection Agent in payment in full of all accrued Collection Agent Fee.

After the Capital, Yield, Fees and Collection Agent Fee with respect to a Receivable Interest, and any other amounts payable by the Seller to the Investors, the Banks or the Agent hereunder, have been paid in full, all additional Collections with respect to such Receivable Interest shall be paid to the Seller for its own account.

(f) For the purposes of this Section 2.04:

(i) if on any day the Outstanding Balance of any Pool Receivable is reduced or adjusted as a result of any defective, rejected or returned merchandise or services, or any cash discount, discount for quick payment or other adjustment made by the Seller or an Originator, or any setoff, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in the amount of such reduction or adjustment;

(ii) if on any day any of the representations or warranties contained in Section 4.01(h) is no longer true with respect to any Pool Receivable, the Seller shall be deemed to have received on such day a Collection of such Pool Receivable in full;

(iii) except as provided in subsection (i) or (ii) of this Section 2.04(f), or as otherwise required by applicable law or the relevant Contract, all Collections received from an Obligor of any Receivables shall be applied to the Receivables of such Obligor in the order of the age of such Receivables, starting with the oldest such Receivable, unless such Obligor designates its payment for application to specific Receivables; and

(iv) if and to the extent the Agent, the Investors or the Banks shall be required for any reason to pay over to an Obligor any amount received on its behalf hereunder, such amount shall be deemed not to have been so received but rather to have been retained by the Seller and, accordingly, the Agent, the Investors or the Banks, as the case may be, shall have a claim against the Seller for such amount, payable when and to the extent that any distribution from or on behalf of such Obligor is made in respect thereof.

SECTION 2.05. Fees . (a) Each Investor and Bank shall pay to the Collection Agent a fee (the “ Collection Agent Fee ”) of 0.50% per annum on the average daily Capital of each Receivable Interest owned by such Investor or Bank, from the date of purchase of such Receivable Interest until the later of the Termination Date for such Receivable Interest or the date on which such Capital is reduced to zero, payable on the Settlement Date for such Receivable Interest. Upon three Business Days’ notice to the Agent, the Collection Agent (if not Ferro, the Seller or its designee or an Affiliate of the Seller) may elect to be paid, as such fee, another percentage per annum on the average daily Capital of such Receivable Interest, but in no event in excess for all Receivable Interests relating to a single Receivables Pool of 110% of the reasonable costs and expenses of the Collection Agent in administering and collecting the Receivables in such Receivables Pool. The Collection Agent Fee shall be payable only from Collections pursuant to, and subject to the priority of payment set forth in, Section 2.04. So long as Ferro is acting as the Collection Agent hereunder, amounts paid as the Collection Agent Fee pursuant to this Section 2.05(a) shall reduce, on a dollar-for-dollar basis, the obligation of the Seller to pay the “Collection Agent Fee” pursuant to Section 6.03 of each of the Purchase Agreement and the Originator Purchase Agreement, provided that such obligation of the Seller shall in no event be reduced below zero.

(b) The Seller shall pay to the Agent certain fees (collectively, the “ Fees ”) in the amounts and on the dates set forth in that certain amended and restated fee agreement dated as of June 6, 2006 between the Seller and the Agent, as the same may be amended or restated from time to time, including by Section 10.14 of this Agreement (the “ Fee Agreement ”).

SECTION 2.06. Payments and Computations, Etc. (a) All amounts to be paid or deposited by the Seller or the Collection Agent hereunder shall be paid or deposited no later than 11:00 A.M. (New York City time) on the day when due in same day funds to the Agent’s Account; provided , that all amounts to be deposited into the Cash Collateral Account shall be deposited no later than 11:00 A.M. (New York City time) on the date when due, and in any event such amounts shall be deposited into the Cash Collateral Account prior to any withdrawal from a Lock-Box Account (other than to directly fund a deposit into the Cash Collateral Account).

(b) Each of the Seller and the Collection Agent shall, to the extent permitted by law, pay interest on any