EX10.1 - Change in Control Agreement


    Exhibit
      10.1

    


    


     

    CHANGE
      IN CONTROL AGREEMENT

     

    Agreement,
      made this 21st day of January, 2006, by and between ENGELHARD CORPORATION,
      a
      Delaware corporation (the “Company”), and Edward T. Wolynic (the
“Executive”).

     

    WHEREAS,
      the Executive is a key employee of the Company; and

     

    WHEREAS,
      the Compensation Committee of the Board of Directors of the Company (the
“Compensation Committee”) and the Board of Directors of the Company (the
“Board”) consider the maintenance of a sound management to be essential to
      protecting and enhancing the best interests of the Company and its stockholders
      and recognize that the possibility of a change in control raises uncertainty
      and
      questions among key employees and may result in the departure or distraction
      of
      such key employees to the detriment of the Company and its stockholders;
      and

     

    WHEREAS,
      the Compensation Committee and the Board wish to assure that the Company will
      have the continued dedication of the Executive and the availability of his
      advice and counsel, notwithstanding the possibility, threat or occurrence of
      a
      bid to take over control of the Company, and to induce the Executive to remain
      in the employ of the Company; and

     

    WHEREAS,
      the Executive is willing to continue to serve the Company taking into account
      the provisions of this Agreement; and

     

    WHEREAS,
      upon recommendation of the Compensation Committee, the Board has approved this
      Agreement with the Executive;

     

    NOW,
      THEREFORE, in consideration of the foregoing, and the respective covenants
      and
      agreements of the parties herein contained, the parties agree as
      follows:

     

    1. Change
      in Control.
      Benefits shall be provided hereunder only in the event there shall have occurred
      a “Change in Control,” as such term is defined below, and the Executive’s
      employment by the Company shall thereafter have terminated in accordance with
      Section 2 below within the period beginning on the date of the “Change in
      Control” and ending on the third anniversary of the date on which a “Change in
      Control” occurs (the “Protection Period”). If any Protection Period terminates
      without the Executive’s employment having terminated, any “Change in Control”
subsequent to such termination shall give rise to a new Protection Period.
      No
      benefits shall be paid under this Agreement if the Executive’s employment
      terminates outside of a Protection Period.

     

    For
      purposes of this Agreement, a “Change in Control” shall mean:

     


    
      
        
        

      

      
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    (A)  the
      acquisition by any individual, entity or group (within the meaning of Section
      13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934, as amended (the
      “Exchange Act”)) (a “Person”), of beneficial ownership (within the meaning of
      Rule 13d-3 promulgated under the Exchange Act) of 25% or more of either (1)
      the
      then outstanding shares of common stock of the Company (the “Outstanding Company
      Common Stock”) or (2) the combined voting power of the then outstanding voting
      securities of the Company entitled to vote generally in the election of
      directors (the “Outstanding Company Voting Securities”); provided,
      however,
      that
      the following acquisitions shall not constitute a Change in Control: (i) any
      acquisition directly from the Company (other than by exercise of a conversion
      privilege); (ii) any acquisition by the Company or any of its subsidiaries;
      (iii) any acquisition by any employee benefit plan (or related trust) sponsored
      or maintained by the Company or any of its subsidiaries; (iv) any acquisition
      by
      any corporation with respect to which, following such acquisition, more than
      60%
      of, respectively, the then outstanding shares of common stock of such
      corporation and the combined voting power of the then outstanding voting
      securities of such corporation entitled to vote generally in the election of
      directors is then beneficially owned, directly or indirectly, by all or
      substantially all of the individuals and entities who were the beneficial
      owners, respectively, of the outstanding Company Common Stock and Outstanding
      Company Voting Securities immediately prior to such acquisition in substantially
      the same proportions as their ownership, immediately prior to such acquisition,
      of the Outstanding Company Common Stock and Outstanding Company Voting
      Securities, as the case may be; or (v) any acquisition by a Person owning more
      than 25% of the Outstanding Company Common Stock on the date
      hereof;

     

    (B)      during
      any period of two consecutive years, individuals who, as of the beginning of
      such period, constitute the Board (the “Incumbent Board”) cease for any reason
      to constitute at least a majority of the Board; provided,
      however,
      that
      any individual becoming a director subsequent to the beginning of such period
      whose election, or nomination for election by the Company’s shareholders, was
      approved by a vote of at least a majority of the directors then comprising
      the
      Incumbent Board shall be considered as though such individual were a member
      of
      the Incumbent Board, but excluding, for this purpose, any such individual whose
      initial assumption of office occurs as a result of either an actual or
      threatened election contest (as such terms are used in Rule 14a-11 of Regulation
      14A promulgated under the Exchange Act); or

     

    (C)     consummation
      of a reorganization, merger or consolidation, in each case, with respect to
      which all or substantially all of the individuals and entities who were the
      beneficial owners, respectively, of the Outstanding Company Common Stock and
      outstanding Company Voting Securities immediately prior to such reorganization,
      merger or consolidation, do not, following such reorganization, merger or
      consolidation, beneficially own, directly or indirectly, more than 60% of,
      respectively, the then outstanding shares of common stock and the combined
      voting power of the then outstanding voting securities entitled to vote
      generally in the election of directors, as the case may be, of the corporation
      resulting from such reorganization, merger or consolidation in substantially
      the
      same proportions as their ownership, immediately 

     

    
      
        
        

      

      
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    prior
      to
      such reorganization, merger or consolidation, of the Outstanding Company Common
      Stock and Outstanding Company Voting Securities, as the case may be;
      or

    
       

    

     

    (D)    
 (1)
      approval by the shareholders of the Company of a complete liquidation or
      dissolution of the Company or (2) consummation of a sale or other disposition
      of
      all or substantially all of the assets of the Company, other than to a
      corporation with respect to which following such sale or other disposition,
      more
      than 60% of, respectively, the then outstanding shares of common stock of such
      corporation and the combined voting power of the then outstanding voting
      securities of such corporation entitled to vote generally in the election of
      directors is then beneficially owned,
      directly or indirectly, by all or substantially all of the individuals and
      entities who were the beneficial owners, respectively, of the outstanding
      Company Common Stock and Outstanding Company Voting Securities immediately
      prior
      to such sale or other disposition in substantially the same proportions as
      their
      ownership, immediately prior to such sale or other disposition, of the
      Outstanding Company Common Stock and Outstanding Company Voting Securities,
      as
      the case may be.

     

    2. Termination
      Following Change in Control.
      The
      Executive shall be entitled to the benefits provided in Section 3 hereof upon
      any termination of his employment with the Company within a Protection Period,
      except a termination of employment (a) because of his death, (b) because of
      a
“Disability,” (c) by the Company for “Cause,” or (d) by the Executive other than
      for “Good Reason.”

     

    (i) Disability.
      The
      Executive’s employment shall be deemed to have terminated because of a
“Disability” if the Executive applies for and is determined to be eligible to
      receive disability benefits under the Company’s Long-Term Disability
      Plan.

     

    (ii) Cause.
      Termination of the Executive’s employment by the Company for “Cause” shall mean
      termination by reason of the Executive’s willful engagement in conduct which
      involves dishonesty or moral turpitude in connection with his employment and
      which is demonstrably and materially injurious to the financial condition or
      reputation of the Company. An act or omission shall he deemed “willful” only if
      done, or omitted to be done, in bad faith and without reasonable belief that
      it
      was in the best interest of the Company. Notwithstanding the foregoing, the
      Executive shall not be deemed to have been terminated for Cause unless and
      until
      there shall have been delivered to the Executive a written notice of termination
      from the Compensation Committee after reasonable notice to the Executive and
      an
      opportunity for him, together with his counsel, to be heard before the
      Compensation Committee, finding that, in the good faith opinion of such
      Compensation Committee, he was guilty of conduct set forth above in the first
      sentence of this subsection (ii) and specifying the particulars in
      detail.

     

    (iii) Without
      Cause.
      The
      Company may terminate the employment of the Executive without Cause during
      a
      Protection Period only by giving the Executive written notice of termination
      to
      that effect. In that event, the Executive’s employment shall terminate on the
      last day of the month in which such notice is given (or such later date as
      may
      be specified in such notice), and the benefits set forth in Section 3 hereof
      shall be provided to the Executive.

     

     

    
      
        
        

      

      
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    (iv) Good
      Reason.
      Termination of employment by the Executive for “Good Reason” shall mean
      termination:

     

    (A)     
within
      a
      Protection Period, if there has occurred a reduction by the Company in the
      Executive’s base salary or incentive compensation opportunity in effect
      immediately before the beginning of the Protection Period or as increased from
      time to time thereafter;

     

    (B)     within
      a
      Protection Period, if the Company has materially diminished the Executive’s job
      authorities or responsibilities with the Company immediately before the
      beginning of the Protection Period, and for this purpose such diminution shall
      not be treated
      as occurring solely due to the fact that the Company is no longer a publicly
      traded company or the fact that the Company is a subsidiary of another
      company;

     

    (C)      
      within
      a
      Protection Period, and without the Executive’s written consent, if the Company
      has required the Executive to be relocated anywhere in excess of thirty-five
      (35) miles from his office location immediately before the beginning of the
      Protection Period, except for required travel on the business of the Company
      to
      an extent substantially consistent with the Executive’s business travel
      obligations immediately before the beginning of the Protection Period;
      or

     

    (D)     within
      a
      Protection Period, if the Company has failed to obtain the assumption of the
      obligations contained in this Agreement by any successor as contemplated in
      Section 8(c) hereof.

     

    The
      Executive shall exercise his right to terminate his employment for Good Reason
      by giving the Company a written notice of termination specifying in reasonable
      detail the circumstances constituting such Good Reason. In that event, the
      Executive’s employment shall terminate on the last day of the month in which
      such notice is given.

     

    A
      termination of employment by the Executive within a Protection Period shall
      be
      for Good Reason if one of the occurrences specified in this subsection (iv)
      shall have occurred, notwithstanding that the Executive may have other reasons
      for terminating employment, including employment by another employer which
      the
      Executive desires to accept.

     

    3. Benefits
      Upon Termination Within Protection Period.
      If,
      within a Protection Period, the Executive’s employment by the Company shall be
      terminated (a) by the Company other than for Cause or because of a Disability,
      or (b) by the Executive for Good Reason, the Executive shall be entitled to
      the
      benefits provided for below:

     

    (i)    The
      Company shall pay to the Executive through the date of the Executive’s
      termination of employment salary at the rate then in effect, together with
      salary in lieu of vacation accrued to the date on which his employment
      terminates, in accordance with the standard payroll practices of the
      Company;

     

    (ii)    The
      Company shall pay to the Executive an amount in cash equal to two times the
      sum
      of (A) his highest annual base salary in effect during the Protection Period,
      and (B) the cash value of the incentive pool under the Company’s Incentive


     

     

    
      
        
        

      

      
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    Compensation
      Plan for the Executive for the calendar year that includes the date of the
      Change in Control, determined based on the Executive’s annual base salary in
      effect at the time of the Change in Control, the Executive’s “Pool Development
      Factors” (i.e., cash bonus factor (for calendar year 2006, 100% of base salary),
      equity pool factor (for calendar year 2006, 50% of base salary) and stock
      options factor (for calendar year 2006, 85% of base salary)) and the Executive’s
      Long Term Performance Unit factor (i.e., for calendar year 2006, 50% of base
      salary) under the Incentive Compensation Plan for the year that includes the
      date of the Change in Control (the total amount of this clause (B) if a Change
      in Control were to occur in calendar year 2006 being 285% of annual base salary
      in effect at the time of the Change
      in
      Control); and such payment shall be made in a lump sum within 10 business days
      after the date of such termination of employment; and

     

    (iii)   The
      Company shall continue to cover the Executive and his dependents under, or
      provide the Executive and his dependents with insurance coverage no less
      favorable than, the Company’s health and dental benefit plans (as in effect on
      the day immediately preceding the Protection Period or, at the option of the
      Executive, on the date of termination of his employment) for a period equal
      to
      the lesser of (x) two years following the date of termination or (y) until
      the
      Executive is provided by another employer with benefits substantially comparable
      to the benefits provided by such plans or programs.

     

    4. Non-exclusivity
      of Rights.
      Nothing
      in this Agreement shall prevent or limit the Executive’s continuing or future
      participation in any benefit, bonus, incentive or other plans, practices,
      policies or programs provided by the Company or any of its subsidiaries and
      for
      which the Executive may qualify, nor shall anything herein limit or otherwise
      affect such rights as the Executive may have under any stock option or other
      agreements with the Company or any of its subsidiaries; provided,
      however,
      that if
      the Executive receives benefits under Section 3 hereof he shall not also be
      entitled to salary continuation benefits under any salary continuation program
      of the Company. Amounts which are vested benefits or which the Executive is
      otherwise entitled to receive under any plan, practice, policy or program of
      the
      Company or any of its subsidiaries at or subsequent to the date of termination
      of the Executive’s employment shall be payable in accordance with such plan,
      practice, policy or program.

     

    5. Full-Settlement;
      Legal Expenses.
      The
      Company’s obligation to make the payments provided for in this Agreement and
      otherwise to perform its obligations hereunder shall not be affected by any
      set-off, counterclaim, recoupment, defense or other claim, right or action
      which
      the Company may have against the Executive or others. In no event shall the
      Executive be obligated to seek other employment or take any other action by
      way
      of mitigation of the amounts payable to the Executive under any of the
      provisions of this Agreement. The Company agrees to pay, upon written demand
      therefor by the Executive, all legal fees and expenses which the Executive
      may
      reasonably incur as a result of any dispute or contest by or with the Company
      or
      others regarding the validity or enforceability of, or liability under, any
      provision of this Agreement (including as a result of any contest by the
      Executive about the amount of any payment hereunder), plus in each case interest
      at the applicable Federal rate provided for in Section 7872(f)(2) of the
      Internal Revenue Code of 1986, as amended (the “Code”); provided,
      however,
      that
      the Company shall be required to pay such legal fees and expenses only if the
      

     

     

    
      
        
        

      

      
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    Executive
      prevails on at least one material claim or material defense in the dispute
      or
      contest. In any such action brought by the Executive for damages or to enforce
      any provisions of this Agreement, he shall be entitled to seek both legal and
      equitable relief and remedies, including, without limitation, specific
      performance of the Company’s obligations hereunder, in his sole
      discretion.

     

    6. Certain
      Additional Payments by the Company.

     

    (a) Anything
      in this Agreement to the contrary notwithstanding, in the event it shall be
      determined that any payment or distribution made, or benefit provided
      (including, without limitation,
      the acceleration of any payment, distribution or benefit), by the Company to
      or
      for the benefit of the Executive (whether paid or payable or distributed or
      distributable pursuant to the terms of this Agreement or otherwise, but
      determined without regard to any additional payments required under this Section
      6) (a “Payment”) would be subject to the excise tax imposed by Section 4999 of
      the Code (or any similar excise tax) or any interest or penalties are incurred
      by the Executive with respect to such excise tax (such excise tax, together
      with
      any such interest and penalties, are hereinafter collectively referred to as
      the
“Excise Tax”), then the Executive shall be entitled to receive an additional
      payment (a “Gross-Up Payment”) in an amount such that after payment by the
      Executive of all taxes (including any Excise Tax, income tax or employment
      tax)
      imposed upon the Gross-Up Payment and any interest or penalties imposed with
      respect to such taxes, the Executive retains from the Gross-Up Payment an amount
      equal to the Excise Tax imposed upon the Payments.

     

    (b) Subject
      to the provisions of Section 6(c), all determinations required to be made under
      this Section 6, including determination of whether a Gross-Up Payment is
      required and of the amount of any such Gross-up Payment, shall be made by Ernst
      & Young LLP (the “Accounting Firm”), which shall provide detailed supporting
      calculations to the Company within 15 business days of the date of termination
      of the Executive’s employment, if applicable, or such earlier time as is
      requested by the Company, provided
      that any
      determination that an Excise Tax is payable by the Executive shall be made
      on
      the basis of substantial authority. The Company will promptly provide copies
      of
      such supporting calculations to the Executive. The initial Gross-Up Payment,
      if
      any, as determined pursuant to this Section 6(b), shall be paid to the Executive
      within five business days of the receipt of the Accounting Firm’s determination.
      If the Accounting Firm determines that no Excise Tax is payable by the
      Executive, it shall furnish the Company with a written opinion that substantial
      authority exists for the Executive not to report any Excise Tax on his Federal
      income tax return and, as a result, the Company is not required to withhold
      Excise Tax from payments to the Executive. The Company will promptly provide
      a
      copy of any such opinion to the Executive. Any determination by the Accounting
      Firm meeting the requirements of this Section 6(b) shall be binding upon the
      Company and the Executive; subject only to payments pursuant to the following
      sentence based on a determination that additional Gross-Up Payments should
      have
      been made, consistent with the calculations required to be made hereunder (the
      amount of such additional payments is referred to herein as the “Gross-Up
      Underpayment”). In the event that the Company exhausts its remedies pursuant to
      Section 6(c) and the Executive thereafter is required to make a payment of
      any
      Excise Tax, the Accounting Firm shall determine the amount of the Gross-Up
      Underpayment that has occurred and any such Gross-Up Underpayment shall be
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    benefit
      of the Executive. The fees and disbursements of the Accounting Firm shall be
      paid by the Company.

     

    (c) The
      Executive shall notify the Company in writing of any claim by the Internal
      Revenue Service that, if successful, would require the payment by the Company
      of
      a Gross-Up Payment. Such notification shall be given as soon as practicable
      but
      not later than ten business days after the Executive receives written notice
      of
      such claim and shall apprise the Company of the nature of such claim and the
      date on which such Claim is requested to be paid. The Executive shall not pay
      such claim prior to the expiration of the 30-day period following the date
      on
      which it gives such notice to the Company (or such shorter period ending on
      the
      date that any payment of taxes with respect to such claim is due). If the
      Company notifies the Executive in writing
      prior to the expiration of such period that it desires to contest such claim
      and
      that it will bear the costs and provide the indemnification as required by
      this
      sentence, the Executive shall:

     

    (i)    give
      the
      Company any information reasonably requested by the Company relating to such
      claim,

     

    (ii)    take
      such
      action in connection with contesting such claim as the Company shall reasonably
      request in writing from time to time, including, without limitation, accepting
      legal representation with respect to such claim by an attorney reasonably
      selected by the Company,

     

    (iii)   cooperate
      with the Company in good faith in order effectively to contest such claim,
      and

     

    (iv)    permit
      the Company to participate in any proceedings relating to such
      claim;

     

    provided,
      however,
      that
      the Company shall bear and pay directly all costs and expenses (including
      additional interest and penalties) incurred in connection with such contest
      and
      shall indemnify and hold the Executive harmless, on an after-tax basis, for
      any
      Excise Tax, income tax or employment tax, including interest and penalties
      with
      respect thereto, imposed as a result of such representation and payment of
      costs
      and expenses. Without limitation on the foregoing provisions of this Section
      6(c), the Company shall control all proceedings taken in connection with such
      contest and, at its sole option, may pursue or forgo any and all administrative
      appeals, proceedings, hearings and conferences with the taxing authority in
      respect of such claim and may, at its sole option, either direct the Executive
      to pay the tax claimed and sue for a refund or contest the claim in any
      permissible manner, and the Executive agrees to prosecute such contest to a
      determination before any administrative tribunal, in a court of initial
      jurisdiction and in one or more appellate courts, as the Company shall
      determine; provided,
      however,
      that if
      the Company directs the Executive to pay such claim and sue for a refund, the
      Company shall advance the amount of such payment to the Executive on an
      interest-free basis and shall indemnify and hold the Executive harmless, on
      an
      after-tax basis, from any Excise Tax, income tax or employment tax, including
      interest or penalties with respect thereto, imposed with respect to such advance
      or with respect to any imputed income with respect to such advance; and
      further provided
      that any
      extension of the statute of limitations relating to the payment of taxes for
      the
      taxable year of the Executive with respect to which such contested amount is
      claimed to be due is limited solely to such contested amount. Furthermore,
      the
      Company’s control of the contest 

     

     

    
      
        
        

      

      
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    shall
      be
      limited to issues with respect to which a Gross-Up Payment would be payable
      hereunder and the Executive shall be entitled to settle or contest, as the
      case
      may be, any other issue raised by the Internal Revenue Service or any other
      taxing authority.

     

    (d) If,
      after
      the receipt by the Executive of an amount advanced by the Company pursuant
      to
      Section 6(c), the Executive becomes entitled to receive any refund with respect
      to such claim, the Executive shall (subject to the Company’s complying with the
      requirements of Section 6(c)) promptly pay to the Company the amount of such
      refund (together with any interest paid or credited thereon after taxes
      applicable thereto). If, after the receipt by the Executive of an amount
      advanced by the Company pursuant to Section 6(c), a determination is made that
      the Executive
      shall not be entitled to any refund with respect to such claim and the Company
      does not notify the Executive in writing of its intent to contest such denial
      of
      refund prior to the expiration of 30 days after such determination, then any
      obligation of the Executive to repay such advance shall be forgiven and the
      amount of such advance shall offset, to the extent thereof, the amount of
      Gross-Up Payment required to be paid.

     

    7. Confidential
      Information.
      The
      Executive shall hold in a fiduciary capacity for the benefit of the Company
      all
      secret or confidential information, knowledge or data relating to the Company
      or
      any of its subsidiaries, and their respective businesses, which shall have
      been
      obtained by the Executive during the Executive’s employment by the Company or
      any of its subsidiaries and which shall not be or become public knowledge (other
      than by acts of the Executive or his representatives in violation of this
      Agreement). After the date of termination of the Executive’s employment with the
      Company, the Executive shall not, without the prior written consent of the
      Company, communicate or divulge any such information, knowledge or data to
      anyone other than the Company and those designated by it. In no event shall
      an
      asserted violation of the provisions of this Section 7 constitute a basis for
      deferring or withholding any amounts otherwise payable to the Executive under
      this Agreement.

     

    8. Successors.

     

    (a) This
      Agreement is personal to the Executive and without the prior written consent
      of
      the Company shall not be assignable by the Executive otherwise than by will
      or
      the laws of descent and distribution. This Agreement shall inure to the benefit
      of and be enforceable by the Executive’s legal representatives or successor(s)
      in interest.

     

    (b) This
      Agreement shall inure to the benefit of and be binding upon the Company and
      its
      successors and assigns.

     

    (c) The
      Company will require any successor (whether direct or indirect, by purchase,
      merger, consolidation or otherwise) to all or substantially all of the business
      and/or assets of the Company to assume expressly and agree to perform this
      Agreement in the same manner and to the same extent that the Company would
      be
      required to perform it if no such succession had taken place. As used in this
      Agreement, other than for purposes of Section 2(iv)(B) above, “Company” shall
      mean the Company as hereinbefore defined and any successor to its business
      and/or assets as aforesaid which assumes and agrees to perform this Agreement
      by
      operation of law or otherwise.

     

     

    
      
        
        

      

      
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    9. Section
      409A.

     

    The
      Company will amend this Agreement, the Deferred Compensation Plan for Key
      Employees of Engelhard Corporation, the Supplemental Retirement Program of
      Engelhard Corporation and any other agreement between the Company and the
      Executive and plan maintained by the Company or its affiliates in which the
      Executive participates which, in any such case, is or otherwise would be subject
      to Section 409A of the Code (collectively, the “DC Plans and Agreements”) in a
      timely manner to the extent, if any, necessary to avoid additional tax or
      interest imposed under Section 409A and the regulations issued thereunder;
      provided,
      however,
      any
      such amendment shall be made in a manner which does not reduce the economic
      value
      of
      the DC Plans and Agreements to the Executive, and any such amendment shall
      not
      defer the date of any payment, or benefit provided, to the Executive unless
      Ernst & Young LLP advises the Company in writing (which written
      determination is promptly provided to the Executive by the Company) that there
      is not substantial authority for otherwise avoiding additional tax or interest
      under Section 409A and in no event will payments be deferred due to Section
      409A
      to a date that is more than six months following termination of the Executive’s
      employment. The Company will consult with the Executive prior to making any
      such
      amendment, and the Executive agrees that his consent to an amendment that is
      consistent with the provisions hereof and satisfies the foregoing proviso will
      not be unreasonably withheld. The Executive will report for income tax purposes
      with respect to Section 409A in a manner consistent with the Company’s reporting
      (as communicated in writing by the Company to the Executive), unless
      inconsistent reporting is otherwise required after audit by the Internal Revenue
      Service. In the event of such an audit, the Executive and the Company agree
      to
      follow procedures substantially similar to those set forth in Section 6 of
      this
      Agreement. The Company will not amend any DC Plan and Agreement in a manner
      which would cause any grandfather protection under Section 409A to be lost
      with
      respect to a DC Plan and Agreement. The Company will indemnify and hold the
      Executive harmless, on an after-tax basis (including, without limitation, income
      tax, additional tax, excise tax, employment tax and any interest or penalties
      with respect thereto), from any cost or liability resulting from any additional
      tax or interest imposed under Section 409A. Any payments required to be deferred
      due to Section 409A will be deposited in the Company’s Supplemental Retirement
      Trust for the Executive’s benefit, and the Trustee thereof will be given
      irrevocable instructions to pay such amounts to the Executive on the earlier
      of
      the date that is six months following termination of the Executive’s employment
      or the first date permissible under Section 409A. Notwithstanding any such
      deposit into the Supplemental Retirement Trust, the Company will continue to
      be
      liable for such payments until such amounts are fully paid to the Executive.
      The
      Company will make any amendments to the Supplemental Retirement Trust necessary
      to effect the provisions hereof.

     

    10. Miscellaneous.

     

    (a) This
      Agreement shall be governed by and construed in accordance with the laws of
      the
      State of New York, without reference to principles of conflict of laws. The
      captions of this Agreement are not part of the provisions hereof and shall
      have
      no force or effect. This Agreement may not be amended or modified otherwise
      than
      by a written agreement executed by the parties hereto or their respective
      successors and legal representatives.

     

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    (b) All
      notices and other communications hereunder shall be in writing and shall be
      given by hand delivery to the other party or by registered or certified mail,
      return receipt requested, postage prepaid, addressed as follows:

     

    If
      to
      the Executive:

     

    Edward
      T.
      Wolynic

     

    [
      ]

    [
      ]

     

    If
      to
      the Company:

     


    Engelhard
      Corporation

    101
      Wood
      Avenue

    Iselin,
      New Jersey 08830-0770

     

    Attention:
      Arthur A. Dornbusch, II

     

    or
      to
      such other address as either party shall have furnished to the other in writing
      in accordance herewith. Notice and communications shall be effective when
      actually received by the addressee.

     

    (c) The
      invalidity or unenforceability of any provision of this Agreement shall not
      affect the validity or enforceability of any other provision of this
      Agreement.

     

    (d) The
      Company may withhold from any amounts payable under this Agreement such Federal,
      state or local taxes as shall be required to be withheld pursuant to any
      applicable law or regulation.

     

    (e) The
      Executive’s failure to insist upon strict compliance with any provision hereof
      shall not be deemed to be a waiver of such provision or any other provision
      thereof.

     

    (f) This
      Agreement contains the entire understanding of the Company and the Executive
      with respect to the subject matter hereof but does not supersede or override
      the
      provisions of any stock option, employee benefit or other plan, program, policy
      or practice in which Executive is a participant or under which the Executive
      is
      a beneficiary.

     

    IN
      WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant to the
      authorization from its Board of Directors, the Company has caused these presents
      to be executed as of the day and year first above written.

     

    Name: 
      /s/ Edward T. Wolynic

     

    ENGELHARD
      CORPORATION

     

    By: 
      /s/ Arthur A. Dornbusch, II

    Name: 
      Arthur A. Dornbusch, II

    Title:   
      Vice President, General Counsel 

                 and
      Secretary

     

     

    
      
         

      

      
        10

        
          

        

      

      
        
        

      

    

     

     

    Attest:

     

    /s/
      John C. Hess

    Name:  
      John C. Hess

    Title:   
      Vice President, Human Resources

     

     

     

     

     

     

     

     

     

    11