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                                                                   EXHIBIT 10.3


                                                                  March 5, 2002




Mr. James L. Pate
Chairman of the Board
Pennzoil-Quaker State Company
P. O. Box 2967
Houston, Texas  77252-2967

Dear Jim:

                  In order to take advantage of your substantial expertise, we
propose the following Agreement to be effective as of March 5, 2002, concerning
the provision by you of consulting services to Pennzoil-Quaker State Company
for the period commencing March 5, 2002, and ending December 31, 2003.

                  In consideration of the mutual promises and understanding
contained in this Agreement, you and Pennzoil-Quaker State Company agree as
follows:

         1.       The term of this Agreement shall commence on March 5, 2002,
                  and end on December 31, 2003.

         2.       You will perform consulting and advisory services on behalf
                  of Pennzoil-Quaker State Company. Such services shall be
                  performed at the request of the Board of Directors of
                  Pennzoil-Quaker State Company, and in connection with your
                  consulting and advisory duties, you will report to the Board
                  of Directors of Pennzoil-Quaker State Company.

         3.       Your services will be rendered primarily in the
                  Pennzoil-Quaker State Company offices in Houston, Texas, and
                  you may travel from time to time upon request by
                  Pennzoil-Quaker State Company.

         4.       In the performance of your services hereunder, the hours you
                  are scheduled to work on any given day will be by mutual
                  agreement with the Board of Directors of Pennzoil-Quaker
                  State Company and Pennzoil-Quaker State Company will rely
                  upon you to accommodate such number of hours as is reasonably
                  necessary to fulfill the spirit and purpose of this
                  Agreement.

         5.       Office and secretarial support will be furnished in Houston
                  as described in Exhibit A to this Agreement. Pennzoil-Quaker
                  State Company cars and aircraft may be utilized as described
                  in Exhibit A to this Agreement.

         6.       During the term of this Agreement, you will not, without the
                  prior written consent of Pennzoil-Quaker State Company,
                  engage directly or indirectly in any business
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                  or endeavor (financially as an individual, investor or lenders
                  or as an employee, director, officer, partner, independent
                  contractor, consultant or owner or in any other capacity
                  calling for the rendition of personal services or acts of
                  management, operation or control) which is in competition or
                  inconsistent with, or adverse to or opposed to, the interests
                  of Pennzoil-Quaker State Company. You should contact the
                  Chief Executive Officer of Pennzoil-Quaker State Company to
                  request such written consent prior to determining it is
                  appropriate to engage in any particular business or endeavor.
                  Notwithstanding the above, you are not prohibited from
                  investing or trading on your own behalf in publicly traded
                  securities of other companies.

         7.       During the term of this Agreement, Pennzoil-Quaker State
                  Company will pay you at the annual rate of $700,000, but in
                  equal monthly amounts of $58,333.33 (except that the last
                  payment shall be $58,333.37) on the first day of the month,
                  commencing March 5, 2002, and continuing each month
                  thereafter with the last payment payable on the first day of
                  December, 2003. In addition, Pennzoil-Quaker State Company
                  will reimburse you for all reasonable and necessary travel
                  expenses incurred in performing services under this Agreement
                  as described in Exhibit A to this Agreement. In the event of
                  your death or disability, any amount unpaid under the terms
                  hereof shall be paid to your spouse, if living, or to your
                  estate, on the same terms as provided hereunder for payment,
                  or, in the sole discretion of the Board of Directors of
                  Pennzoil-Quaker State Company, at such earlier date as
                  determined by the Board of Directors of Pennzoil-Quaker State
                  Company.

         8.       In addition to any other benefits to which you are entitled
                  under this Agreement, during the term of this Agreement,
                  Pennzoil-Quaker State Company will cover you under, and you
                  will be a participant in, the Pennzoil-Quaker State Company
                  Executive Severance Plan ("Executive Severance Plan") and for
                  purposes of the Executive Severance Plan your Cash Severance
                  Payment will be determined as the product of your annual rate
                  of pay in Paragraph 7 above ($700,000) and three and will be
                  in addition to any other benefits under this Agreement, with
                  no offsets for benefits provided under any other plan or
                  program of Pennzoil-Quaker State Company. Upon any Change in
                  Control (as defined in the Executive Severance Plan), you
                  shall be deemed to have terminated under conditions entitling
                  you to immediate payment of the Cash Severance Payment and
                  there shall be no reduction in your benefit by reason of
                  attained age.

         9.       Your Tax Protection Agreement dated as of December 30, 1998,
                  will continue in effect.

         10.      Your Excess Benefit Agreement dated as of December 30, 1998,
                  will continue in effect.

         11.      Your participation in the 2000 Pennzoil-Quaker State Company
                  Long-Term Incentive Plan ("2000 LTIP") shall continue and, in
                  the event of the occurrence of
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                  a Change in Control, as defined in the Executive Severance
                  Plan, occurring prior to January 1, 2004, you shall receive
                  upon the consummation of such Change in Control, in lieu of
                  any amounts to which you would otherwise be entitled under
                  the 2000 LTIP, a cash payment equal to the product of (x)
                  your annual salary rate as of December 31, 2000 ($890,000),
                  and (y) the percentage of salary rate payout applicable under
                  the 2000 LTIP determined as if the end of the performance
                  period had occurred as of the day before the later to occur
                  of (I) the announcement by Pennzoil-Quaker State Company of
                  its intention to engage in a transaction that would
                  constitute a Change in Control, or (II) a "person" (as
                  defined in the Executive Severance Plan) other than
                  Pennzoil-Quaker State Company announces that it will attempt
                  a transaction that if consummated would constitute a Change
                  in Control.

         12.      Neither you, nor your spouse or other beneficiaries shall
                  have the right to assign any part of your or their rights
                  under this Agreement. This Agreement contains the entire
                  understanding between Pennzoil-Quaker State Company and you
                  regarding this matter and supersedes any prior agreement
                  between the parties.

         13.      This Agreement may not be changed or otherwise amended except
                  by mutual consent evidenced in writing and executed by both
                  parties to this Agreement.

         14.      This Agreement is governed by the laws of the State of Texas.

         15.      This Agreement supersedes that certain Letter Agreement
                  between you and Pennzoil-Quaker State Company dated May 4,
                  2000.

                                           Very truly yours,


                                           /s/ JAMES J. POSTL
                                           -------------------------------------
                                           James J. Postl
                                           President and Chief Executive Officer
                                           Pennzoil-Quaker State Company


Accepted and agreed to as of the
5th day of March, 2002.


/s/ JAMES L. PATE
----------------------
James L. Pate


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                   EXHIBIT A TO AGREEMENT DATED MARCH 5, 2002

                              SUPPORT AND EXPENSES


                  The following are the support and expenses obligations of
Pennzoil-Quaker State Company (the "Company") to James L. Pate ("Mr. Pate")
during the period ending December 31, 2003:

         1.       Company cars and aircraft may be utilized under the same
                  terms and conditions as have been applicable immediately
                  prior to the date of the Agreement, with any personal use of
                  aircraft subject to IRS imputed income requirements.

         2.       Expenses incurred by Mr. Pate in furtherance of the Company's
                  business shall be reimbursed in accordance with customary
                  Company practices and procedures regarding expense
                  reimbursements as in effect immediately prior to the date of
                  this Agreement.

                  The following are the Company's obligations with respect to
retired chief executive officers and will continue throughout Mr. Pate's
retirement:

         1.       Office space, furniture and equipment appropriate to the
                  status of a retired chairman of the board of a publicly-held
                  company will be provided.

         2.       Company will employ an executive assistant, acceptable to Mr.
                  Pate, who will be an employee of the Company with full
                  participation in the Company's employee benefit plans,
                  programs and practices. The executive assistant will report
                  to Mr. Pate and the duties and compensation of that assistant
                  will be determined by Mr. Pate (within the parameters of
                  overall Company guidelines and policy).

         3.       Mr. Pate and his executive assistant will be provided with
                  parking spaces acceptable to Mr. Pate.

         4.       Full reimbursement for cost of private ground transportation
                  service used in lieu of a Company chauffeured car.