Exhibit
10.12


 


 


EMPLOYMENT
AGREEMENT





BETWEEN





PQ CORPORATION 





AND





SCOTT H. RANDOLPH



FEBRUARY 11, 2005


 


 





















EMPLOYMENT
AGREEMENT dated as of August 15, 2005, and effective as of
February 11, 2005, by and between PQ Corporation, a Pennsylvania corporation
(the “Company”) and wholly-owned subsidiary of Niagara Holdings, Inc., a
Delaware corporation (“Holdings”), and Scott H. Randolph (the “Executive”).


WHEREAS, pursuant to
that certain Agreement and Plan of Merger dated as of December 15, 2004 (the “Merger
Agreement”) by and among the Company, Holdings and Niagara Acquisition,
Inc., a Delaware corporation and wholly-owned subsidiary of Holdings (“Merger
Sub”), Merger Sub was merged with and into PQ, with PQ as the surviving
corporation (the “Merger”) effective as of February 11, 2005.


WHEREAS, the Company
desires to employ the Executive, and the Executive desires to accept such
employment, on the terms and subject to the conditions hereinafter set
forth.  The Company acknowledges that the
Executive is also the majority owner of Finure Enterprises (“Finure”)
and the Chief Financial Officer of (i) Peak Investments, L.L.C., (ii) Peak
Chemical LLC, (iii) Peak Lime, Inc. d/b/a Southern Lime and (iv) Peak Sulfer
Inc.  The Company understands that the Executive
will maintain all his interests and positions in Finure and in all the Peak
Companies (as defined herein) notwithstanding his employment with the Company
hereunder.  Capitalized terms used herein
and not otherwise defined shall have the meanings ascribed to them in Section
13.


NOW,
THEREFORE, in consideration of the covenants contained herein
and other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:


Section
1.              Employment.


The
Company shall employ the Executive, and the Executive accepts employment with
the Company, upon the terms and conditions set forth in this Agreement for the
period beginning on February 11, 2005 (the “Effective Date”) and ending
on the Termination Date determined pursuant to Section 4(a) (the “Employment
Period”).


Section
2.              Position and Duties.


(a)           During
the Employment Period, the Executive shall report to the Chief Executive
Officer of the Company (the “CEO”) and perform such duties, activities and responsibilities as
directed by the CEO.  The Executive
acknowledges and agrees that he owes a fiduciary duty of loyalty to the Company
to discharge his duties and otherwise act in a manner consistent with the best
interests of the Company and its Subsidiaries.


(b)           During
the Employment Period, except with the prior consent of the Board (excluding
the Executive if he should be a member of the Board at the time of such
determination), the Executive shall devote his best efforts and all of his working
time, attention and energies to the performance of his duties and
responsibilities under this Agreement (except for vacations to which he is
entitled pursuant to Section 3(a) and except for illness or incapacity).  The Executive shall not engage in any
business activity which, in the reasonable judgment of the Board (excluding the
Executive if he should be a member of the Board at the time of such
determination), conflicts with the duties of the Executive hereunder, whether
or not such activity 


 


 





















 


is pursued for gain, profit or other pecuniary
advantage.  Provided such time and
attention does not materially interfere with his duties to the Company, the
Board agrees that the Executive’s duties, responsibilities and activities on
behalf of and to Finure and the Peak Companies will not be considered to
conflict with the Executive’s duties to the Company under this Section 2.


Section
3.              Base Salary, Bonus and
Benefits.


(a)           During
the Employment Period, the Executive’s base salary shall be $240,000 per annum,
or such higher rate as the Board or Compensation Committee of the Board
(excluding the Executive if he should be a member of the Board or the
Compensation Committee at the time of such determination) may designate from
time to time (the “Base Salary”), which salary shall be payable in such
installments as is customary for other senior executives of the Company.  The Executive shall be entitled to take four
(4) weeks of paid vacation annually.  The
Board or Compensation Committee shall conduct a review of the Executive’s Base
Salary on an annual basis.  During the
Employment Period, the Executive shall also be entitled to participate in the standard
benefit plans available to the Company’s employees generally, in accordance
with the terms and conditions of such plans as in effect from time to time.


(b)           Executive
shall be eligible to receive, in addition to the Base Salary, an annual bonus
(the “Bonus”) for services rendered during each calendar year in the
Employment Period.  The amount of Bonus,
if any, payable in respect of any calendar year will be determined based on the
achievement of performance goals established by the Board or Compensation
Committee within the first 90 days of such year.  The target Bonus in respect of each calendar
year (the “Target Bonus Percentage”) will equal 40% of
the base salary paid or payable to the Executive for such year.


(i)            Notwithstanding anything to the contrary in this Section
3(b), the Bonus payable with respect to 2005 shall be $96,000, provided the
Executive remains employed with the Company through the applicable payment date.


(ii)           The Bonus, if any, payable with respect to a calendar year
shall be paid within thirty (30) days following the rendering of the Company’s
audited financial statements for the relevant calendar year, subject to
Executive’s continued
employment with the Company through such payment date.


(c)           The
Company shall reimburse the Executive for all reasonable and necessary expenses
incurred by him in the course of performing his duties under this Agreement
which are consistent with the Company’s policies in effect from time to time
with respect to travel, entertainment and other business expenses, subject to
the Company’s requirements with respect to reporting and documentation of such
expenses.


(d)           The Company shall deduct from any
payments to be made by it to or on behalf of the Executive under this Agreement
any amounts required to be withheld in respect of any federal, state or local
income or other taxes.


 


 


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Section
4.              Termination.


(a)           Termination
Date.  The Executive’s employment
under this Agreement shall terminate upon the earliest to occur (the date of
such occurrence being the “Termination Date”) of (i) the expiration of
the Term; (ii) the effective date of the Executive’s resignation other than for
Good Reason (a “Resignation”); (iii) the Executive’s death or Disability
(an “Involuntary Termination”); (iv) the effective date of a termination
of the Executive’s employment for Cause by the Board (a “Termination for
Cause”); (v) the effective date of Executive’s resignation for Good Reason
(a “Termination for Good Reason”) and (vi) the effective date of a
termination of the Executive’s employment by the Board for reasons that do not
constitute Cause (a “Termination without Cause”).  The effective date of a Resignation or
Termination for Good Reason shall be as determined under Section 4(b);
the effective date of an Involuntary Termination shall be the date of death or,
in the event of a Disability, the date specified in a notice delivered to the
Executive by the Company; and the effective date of a Termination for Cause or
a Termination without Cause shall be the date specified in a notice delivered
to the Executive by the Company of such termination.


(b)           Resignation
or Termination for Good Reason.  The
Executive shall give the Company at least 30 days’ prior written notice of his
Resignation or Termination for Good Reason, with the effective date thereof
specified therein.  The Board may, in its
discretion, accelerate the effective date of such termination of employment.


(c)           Term/Renewal.  The initial term of employment under this
Agreement (the “Initial Term”) shall be for the period beginning on the
Effective Date and ending on the fifth anniversary thereof, unless earlier
terminated pursuant to Section 4(a); provided that the term of
employment may be extended for one or more additional one (1) year period(s)
(each, an “Extension Term”) by mutual agreement of the Company and the
Executive not later than 90 days prior to the expiration of the Initial Term or
Extension Term, if any, then in effect. 
The Initial Term and any Extension Term shall be collectively referred
to as the “Term” hereunder. 
Nothing stated in this Agreement or represented orally or in writing to
either party shall create any obligation of either party to renew this
Agreement.


Section
5.              Effect of Termination;
Severance.  


(a)           General.  In the event of the Executive’s termination
of employment for any reason, the Executive or his estate or beneficiaries shall
have the right to receive the following:


(i)            the
unpaid portion of the Base Salary and paid time off accrued and payable through
the Termination Date; and


(ii)           reimbursement
for any expenses for which
the Executive shall not have been previously reimbursed, as provided in Section
3(c).


The
Executive (or his estate or beneficiaries) shall be entitled to the cash
severance payments described below only as set forth herein, and the provisions
of this Section 5 shall supersede in their entirety any severance
payment provisions in any severance plan, policy, program or arrangement
maintained by the Company.


 


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(b)           Termination
without Cause or Termination for Good Reason. In the event of a Termination
without Cause or a Termination for Good Reason, and subject to the Executive’s
entering into a Release Agreement with the Company in substantially the form
attached hereto as Exhibit A (the “Release”), the Executive shall
have the right to receive the following:


(i)            the
Base Salary provided by Section 3(a) hereof for a period of eighteen (18)
months from the Termination Date (the “Severance Period”), such amount
to be deemed liquidated damages and payable at the applicable payroll periods; provided,
however, that in the event of a breach by the Executive of Section 6,
7, 8, or 9 on or after the Termination Date, the
provisions of Section 11 shall apply;


(ii)           a
pro rata amount of the Bonus, if any, which would have been payable to the
Executive for the calendar year in which such termination occurs, determined
after the end of the calendar year in which such termination occurs and equal
to the amount which would have been payable to the Executive if Executive’s
employment had not been terminated during such calendar year multiplied by a
fraction, the numerator of which is the number of whole months the Executive
was employed by the Company during such calendar year and the denominator of
which is 12.  Any pro rata bonus payable
under this Section 5(b)(ii) shall be paid in substantially equal
installments over the remaining term of the Severance Period following
calculation of such pro rata bonus amount;


(iii)          an
amount equal to the product of (A) the amount of the Bonus, if any, paid or
payable to the Executive in respect of the most recently completed fiscal year
ending on or prior to the Termination Date and (B) 1.5, to be paid in
substantially equal installments over the Severance Period; and


(iv)          an
amount equal to any earned but unpaid Bonus in respect of fiscal years ending
on or prior to the Termination Date, to be paid in substantially equal installments
over the Severance Period.


(c)           Involuntary
Termination.  In the event of an
Involuntary Termination, the Executive (or his estate or beneficiaries) shall
have the right to receive a pro rata amount of the Bonus, if any, which would
have been payable to the Executive for the calendar year in which such
termination occurs, determined after the end of the calendar year in which such
termination occurs and equal to the amount which would have been payable to the
Executive if Executive’s employment had not been terminated during such
calendar year multiplied by a fraction, the numerator of which is the number of
whole months the Executive was employed by the Company during such calendar
year and the denominator of which is 12. 
Any pro rata bonus payable under this Section 5(c) shall be paid
within thirty days following the determination of such pro rata bonus amount.


(d)           The rights
of the Executive set forth in this Section 5 are intended to be the
Executive’s exclusive remedy for termination and, to the greatest extent
permitted by applicable law, the Executive waives all other remedies.


 


 


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Section
6.              Nondisclosure and
Nonuse of Confidential Information.


The
Executive will not disclose or use at any time, either during the Employment
Period or thereafter, any Confidential Information of which the Executive is or
becomes aware, except to the extent that (i) such disclosure or use is directly
related to and required by the Executive’s performance of duties assigned to
the Executive by the Company; (ii) to the extent that such disclosure is
required in connection with any action by the Executive to enforce rights under
this Agreement or (iii) such disclosure is required by a court of law,
governmental agency, or by any administrative or legislative body with
jurisdiction to order the Executive to divulge or disclose such Confidential
Information; provided, that, the Executive shall provide ten (10) days
prior written notice to the Company of any such requirement or order to
disclose Confidential Information so that the Company may seek a protective
order or similar remedy; and, provided, further, that, in each case set forth
above, the Executive informs the recipients that such information or
communication is confidential in nature.


Section
7.              Inventions and Patents.


The
Executive agrees that all Work Product belongs to the Company.  The Executive will promptly disclose such
Work Product to the Board and perform all actions reasonably requested by the
Board (whether during or after the Employment Period) to establish and confirm
such ownership (including, without limitation, the execution and delivery of
assignments, consents, powers of attorney and other instruments) and to provide
reasonable assistance to the Company in connection with the prosecution of any
applications for patents, trademarks, trade names, service marks or reissues
thereof or in the prosecution or defense of interferences relating to any Work
Product.


Section
8.              Non-Compete and
Non-Solicitation.


The
Executive acknowledges and agrees with the Company that during the course of
the Executive’s employment with the Company, the Executive will have the
opportunity to develop relationships with existing employees, customers and
other business associates of the Company and its Subsidiaries which relationships
constitute goodwill of the Company, and the Company would be irreparably
damaged if the Executive were to take actions that would damage or
misappropriate such goodwill. 
Accordingly, the Executive agrees as follows:


(a)           The
Executive acknowledges that the Company currently conducts its business
throughout North America, South America, Europe and Asia (the “Territory”).  Accordingly, during the Term and during the
18-month period following the Termination Date (the “Non-Compete Period”),
the Executive shall not, directly or indirectly, enter into, engage in, assist,
give or lend funds to or otherwise finance, be employed by or consult with, or
have a financial or other interest in, any business which engages within the
Territory in any business in which the Company engages, whether for or by
himself or as an independent contractor, agent, stockholder, partner or joint
ventures for any other Person (any such activity, “Competition”).  To the extent that the covenant provided for
in this Section 8(a) may later be deemed by a court to be too broad to
be enforced with respect to its duration or with respect to any particular
activity or geographic area, the court making such determination shall have the
power to reduce the duration or scope of the provision, and to add or delete
specific words or phrases to or from the provision.  The 


 


 


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provision as modified shall then be enforced.  Notwithstanding the foregoing, the primary
business activity conducted by Finure and each of the Peak Companies as of the
Effective Time shall not constitute Competition hereunder.


(b)           Notwithstanding
the foregoing, the aggregate ownership by the Executive of no more than two (2)
percent (on a fully-diluted basis) of the outstanding equity securities of any
Person, which securities are traded on a national or foreign securities
exchange, quoted on the NASDAQ stock market or other automated quotation
system, and which Person competes with the Company (or any part thereof) within
the Territory, shall not be deemed to be a violation of Section 8(a).  In the event that any Person in which the
Executive has any financial or other interest directly or indirectly enters
into a line of business during the Non-Compete Period that competes with the
Company or engages in the business of the Company within the Territory, the
Executive shall divest all of his interest (other than as permitted to be held
pursuant to the first sentence of this Section 8(b)) in such Person
within 15 days after such Person enters into such line of business that
competes with the Company or engages in such business within the Territory.


(c)           The Executive covenants and agrees
that during the Term and during the 18-month period following the
Termination Date, except as expressly provided herein, the Executive will not,
directly or indirectly, either for himself or for any other Person (i) solicit
any employee or consultant of the Company or any of its Subsidiaries to
terminate his or her employment or consulting relationship with the Company or
any of its Subsidiaries; (ii) employ any employee or consultant of the Company
or any of its Subsidiaries during the period of his or her employment or
consulting relationship with the Company or any of its Subsidiaries; (iii)
solicit any customer of the Company or any of its Subsidiaries to purchase or
distribute information, products or services of or on behalf of the Executive
or such other Person that are competitive with the information, products or
services provided by the Company or any of its Subsidiaries or (iv) take
any action that may cause injury to the relationships between the Company or
any of its Subsidiaries or any of their employees and any lessor, lessee,
vendor, supplier, customer, distributor, employee, consultant or other business
associate of the Company or any of its Subsidiaries as such relationship
relates to the Company’s or any of its Subsidiaries’ conduct of their business.  Notwithstanding the preceding sentence, the
provisions of this Section 8(c) shall not apply to the solicitation or
employment of the members of the Peak Group (but shall apply with respect to
the solicitation or employment of Michael R. Boyce); provided, however,
that nothing herein shall be construed as an amendment, waiver or modification
to any other term or provision of this Agreement, or to any restrictive
covenant or other provision contained in any agreement between any member of
the Peak Group or Michael R. Boyce and Holdings, the Company or any Subsidiary
of either of them.


(d)           The
Executive understands that the foregoing restrictions may limit his ability to
earn a livelihood in a business similar to the business of the Company and any
of its Subsidiaries, but he nevertheless believes that he has received and will
receive sufficient consideration and other benefits as an employee of the
Company and as otherwise provided hereunder or as described in the recitals
hereto to clearly justify such restrictions which, in any event (given his
education, skills and ability), the Executive does not believe would prevent
him from otherwise earning a living.


 


 


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Section
9.              Delivery of Materials
Upon Termination of Employment.


The
Executive shall deliver to the Company at the termination of the Employment
Period or at any time the Company may request all memoranda, notes, plans, records,
reports, computer tapes and software and other documents and data (and copies
thereof) relating to the Confidential Information or Work Product which he may
then possess or have under his control regardless of the location or form of
such material and, if requested by the Company, will provide the Company with
written confirmation that all such materials have been delivered to the
Company.


Section
10.            Insurance.


The
Company may, for its own benefit, maintain “key man” life and disability
insurance policies covering the Executive. 
The Executive will cooperate with the Company and provide such
information or other assistance as the Company may reasonably request in
connection with the Company obtaining and maintaining such policies.


Section
11.            Enforcement. 


Because
the Executive’s services are unique and because the Executive has access to
Confidential Information and Work Product, the parties hereto agree that money
damages would be an inadequate remedy for any breach of this Agreement.  Therefore, in the event of a breach or
threatened breach of this Agreement, the Company or its successors or assigns
may, in addition to other rights and remedies existing in their favor, apply to
any court of competent jurisdiction for specific performance and/or injunctive
or other relief in order to enforce, or prevent any violations of, the
provisions hereof (without posting a bond or other security).  In addition to the foregoing, and not in any
way in limitation thereof, or in limitation of any right or remedy otherwise
available to the Company, if the Executive violates any provision of the
foregoing Sections 6, 7, 8 or 9, any payments then
or thereafter due from the Company to the Executive pursuant to Section 5(b)
shall be terminated forthwith and the Company’s obligation to pay and the
Executive’s right to receive such payments shall terminate and be of no further
force or effect, in each case without limiting or affecting the Executive’s
obligations under such Sections 6, 7, 8 and 9 or
the Company’s other rights and remedies available at law or equity.


Section
12.            Representations.


(a)           Each
party hereby represents and warrants to the other party that (a) the execution,
delivery and performance of this Agreement by such party does not and will not
conflict with, breach, violate or cause a default under any agreement, contract
or instrument to which such party is a party or any judgment, order or decree
to which such party is subject, and (b) upon the execution and delivery of this
Agreement by such party, this Agreement will be a valid and binding obligation
of such party, enforceable in accordance with its terms, except as enforcement
hereof may be limited by any applicable bankruptcy, reorganization, insolvency
or other laws affecting creditors rights generally or by general principles of
equity.  In addition, the Executive
represents and warrants to the Company that except as set forth on Schedule
1 attached hereto, the Executive is not a party to or bound by any
employment agreement, consulting agreement, non-compete agreement,
confidentiality agreement or similar agreement with any other Person.


 


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(b)           The
Executive (or a trust established for the benefit of his family members) has as
of the date hereof, or will have not later than September 15, 2005, purchased,
directly or indirectly, or has, or within such period will have, caused PQP LLC
to purchase, for his or its benefit, not less than two hundred (200) shares of
Class B Common Stock (the “Executive Stock”).  The Executive represents and warrants that at
all times during the Employment Period, he shall maintain his direct or
indirect beneficial ownership of the Executive Stock (as adjusted for any stock
dividend, stock split, reverse stock split or recapitalization) and shall not
transfer, and shall cause the record owner of the Executive Stock or any voting
or economic interest therein not to transfer, the Executive Stock other than
pursuant to and in compliance with the Stockholders Agreement.


Section
13.            Definitions.


 “Board” shall mean the board of directors
of the Company.


“Business
Day” shall mean any day that is not a Saturday, Sunday, or a day on which
banking institutions in New York are not required to be open.


“Cause”
shall mean (i) the failure by the Executive to perform such duties as are
reasonably requested by the Board which is not cured within thirty (30) days of
receipt by the Executive of written notice detailing the same from the Board;
(ii) the failure by the Executive to observe any material Company policies and
material policies of all Subsidiaries of the Company generally applicable to
executives of the Company and/or its Subsidiaries of which the Executive has
notice; (iii) gross negligence or willful misconduct by the Executive in the
performance of his duties or the Executive’s willful disregard of his duties; (iv)
the commission by the Executive of any act which results in his conviction, or
plea of guilty or no contest to, a felony, or his commission of any act
involving moral turpitude, fraud or theft; (v) the material breach by the
Executive of (A) this Agreement, including, without limitation, any breach by
the Executive of the provisions of Section 6, Section 7 or Section
8, (B) any Subscription Agreement or Restricted Stock Agreement or (C) any
Stockholders Agreement to which the Company or Holdings and the Executive may
become a party or (vi) any acts of dishonesty undertaken by the Executive and
intended to result in substantial enrichment, at the Company’s expense, of the
Executive or any other Person.


“Change of Control” shall mean the
first occurrence of any one of the following:  (i) a change in the
ownership or control of the Company effected through a transaction or series of
transactions (including by way of merger, consolidation, business combination
or similar transaction involving the Company or any of its Subsidiaries)
whereby any “person” or related “group” of “persons” (as such terms are used in
Sections 13(d) and 14(d)(2) of the Exchange Act) (other than the Company, any
of its Subsidiaries, an employee benefit plan maintained by the Company or any
of its Subsidiaries, or a “person” that, prior to such transaction, directly or
indirectly controls, is controlled by, or is under common control with, the
Company) directly or indirectly acquires beneficial ownership (within the
meaning of Rule 13d-3 under the Exchange Act), of 50% or more of the total
combined voting power of the Company’s Shares outstanding immediately after
such transaction or series of transactions; or (ii) the sale, lease, transfer,
conveyance or other disposition (other than by way of a transaction that would
not be deemed a Change of Control pursuant to clause (i) above), in one or a
series of related transactions, of all 


 


 


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or
substantially all of the assets of the Company and its Subsidiaries taken as a
whole, to any “person” (as defined above).


“Class B Common Stock” shall mean
the Class B Common Stock, $0.01 par value per share, of Holdings.


“Company”
shall have the meaning set forth in the preamble; provided, that, for
purposes of Sections 6, 7, 8 and 9, “Company” shall include Niagara
Holdings, Inc.


“Confidential
Information” shall mean information that is not generally known to the
public and that is or was used, developed or obtained by the Company or any of
its Subsidiaries or affiliates, known by the Executive as a consequence of his
employment with, or direct or indirect services as agent, employee or
consultant, to or on behalf of, the Company or Holdings or any Subsidiary or
affiliate of either of them, including, but not limited to the following:
(i) information, observations, procedures and data concerning the business
or affairs of the Company or any of its Subsidiaries; (ii) products or
services; (iii) costs and pricing structures; (iv) analyses; (v) drawings,
photographs and reports; (vi) computer software, including operating systems,
applications and program listings; (vii) flow charts, manuals and
documentation; (viii) data bases; (ix) accounting and business methods;
(x) inventions, devices, new developments, methods and processes, whether
patentable or unpatentable and whether or not reduced to practice; (xi)
customers, vendors, suppliers and customer, vendor and supplier lists; (xii)
other copyrightable works; (xiii) all production methods, processes, technology
and trade secrets and (xiv) all similar and related information in whatever
form.  Confidential Information will not
include any information that has been published in a form generally available
to the public prior to the date the Executive proposes to disclose or use such
information.  Confidential Information
will not be deemed to have been published merely because individual portions of
the information have been separately published, but only if all material
features comprising such information have been published in combination.


“Disability”
shall mean the physical or mental illness, disease or incapacity of the
Executive (i) that renders him substantially unable to perform all of his
duties under this Agreement for a period of 90 consecutive days or longer, or
for 90 or more days in any period of 365 consecutive days, or (ii) that, in the
opinion of a physician selected by the Board (excluding the Executive if the
Executive is a member of the Board at such time), but reasonably acceptable to
the Executive, is likely to prevent the Executive from substantially performing
all of his duties under this Agreement for more than 90 days in any period of
365 consecutive days.


“Good Reason” shall mean the
occurrence of any of the following events without the prior consent of the Executive:  (i) a material reduction in the Executive’s authority,
duties and responsibilities, excluding for this purpose isolated or immaterial
actions or (ii) a reduction in the Base Salary or Target Bonus Percentage or
any failure by the Company to provide any material payment or benefit under
this Agreement; provided, however, that in each case the Executive may not
resign his employment for Good Reason unless: (x) he provides the Company with
at least 30 days’ prior written notice of his intent to resign for Good Reason
(which notice is provided not later than the 30th day following the occurrence
of the event constituting Good Reason) and (y) the Company does not remedy the
alleged violation(s) within such 30-day notice period.  In addition to the foregoing, the Executive
shall have “Good Reason” to resign his 


 


 


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employment upon 30 days’ prior written notice not later than 90 days
following the occurrence of a Change of Control.


“Peak
Companies” shall mean Peak Chemical LLC, Peak Lime, Inc. d/b/a Southern
Lime and Peak Sulfur Inc.


“Peak
Group” shall mean Paul Ferrall, William Sichko and Billy Whalen.


“Person”
shall be construed broadly and shall include, without limitation, an
individual, a partnership, an investment fund, a limited liability company, a
corporation, an association, a joint stock company, a trust, a joint venture,
an unincorporated organization and a governmental entity or any department,
agency or political subdivision thereof.


“Representative”
shall mean, with respect to a deceased Executive, the duly appointed, qualified
and acting personal representative (or personal representatives collectively)
of the estate of the deceased Executive (or portion of such estate that
includes Executive Stock), whether such personal representative holds the
position of executor, administrator or other similar position qualified to act
on behalf of such estate.


“Restricted
Stock Agreement” shall mean the Restricted Stock Agreement, dated on or
about the date hereof, relating to the vesting, sale and other matters
involving the stock of Holdings held by the Executive.


“Stockholders
Agreement” shall mean the Stockholders Agreement dated on or the Effective
Date between Holdings and certain stockholders of Holdings, as amended,
modified or supplemented from time to time.


“Subscription
Agreement” shall mean that certain Subscription and Stock Purchase
Agreement dated on or about the date hereof between Holdings and the Executive.


“Subsidiary”
or “Subsidiaries” of any Person shall mean any corporation, partnership,
joint venture or other legal entity of which such Person (either alone or
through or together with any other Person), owns, directly or indirectly, 50%
or more of the stock or other equity interests which are generally entitled to
vote for the election of the board of directors or other governing body of such
corporation or other legal entity.


“Work Product” shall mean all
inventions, innovations, improvements, technical information, systems, software
developments, methods, designs, analyses, drawings, reports, service marks,
trademarks, tradenames, logos and all similar or related information (whether
patentable or unpatentable) which relates to the Company’s or any of its
Subsidiaries’ actual or anticipated business, research and development or existing
or future products or services and which are conceived, developed or made by
the Executive (whether or not during usual business hours and whether or not
alone or in conjunction with any other Person) while employed by the Company
together with all patent applications, letters patent, trademark, tradename and
service mark applications or registrations, copyrights and reissues thereof
that may be granted for or upon any of the foregoing.


 


 


10





















 


Section
14.            General Provisions.


(a)           Severability.  It is the desire and intent of the Parties
hereto that the provisions of this Agreement be enforced to the fullest extent
permissible under the laws and public policies applied in each jurisdiction in
which enforcement is sought. 
Accordingly, if any particular provision of this Agreement shall be
adjudicated by a court of competent jurisdiction to be invalid, prohibited or
unenforceable for any reason, such provision, as to such jurisdiction, shall be
ineffective, without invalidating the remaining provisions of this Agreement or
affecting the validity or enforceability of this Agreement or affecting the
validity or enforceability of such provision in any other jurisdiction.  Notwithstanding the foregoing, if such
provision could be more narrowly drawn so as not to be invalid, prohibited or
unenforceable in such jurisdiction, it shall, as to such jurisdiction, be so
narrowly drawn, without invalidating the remaining provisions of this Agreement
or affecting the validity or enforceability of such provision in any other
jurisdiction.


(b)           Notices.  All notices, requests, demands, claims and
other communications hereunder shall be in writing and sufficient if (i)
delivered personally, (ii) delivered by certified United States Post Office
mail, return receipt requested, (iii) telecopied or (iv) sent to the recipient
by a nationally-recognized overnight courier service (charges prepaid) and
addressed to the intended recipient as set forth below:


	
  (i)

  	
  if to the Executive, to
  him at his most recent address in the Company’s records,

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  Peak Investments, L.L.C.

  
	
   

  	
   

  	
  15700 College Blvd.

  
	
   

  	
   

  	
  Suite 101

  
	
   

  	
   

  	
  Lenexa, KS 66219

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Michael R. Boyce

  
	
   

  	
   

  	
   

  	
  William J. Sichko, Jr.

  
	
   

  	
   

  	
  Facsimile:

  	
  (913) 227-0287

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
  if to the Company, to:

  	
  PQ Corporation

  
	
   

  	
   

  	
  c/o J.P. Morgan Partners
  (BHCA), L.P.

  
	
   

  	
   

  	
  1221 Avenue of the
  Americas, 39th Floor

  
	
   

  	
   

  	
  New York, New York 10020

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Timothy J. Walsh

  
	
   

  	
   

  	
   

  	
  Stephen V. McKenna

  
	
   

  	
   

  	
  Facsimile:

  	
  (212) 899-3401

  
	
   

  	
   

  	
   

  
	
   

  	
  with a copy to:

  	
  Latham & Watkins LLP

  
	
   

  	
   

  	
  885 Third Avenue, Suite
  1000

  
	
   

  	
   

  	
  New York, NY 10022

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  David S. Allinson

  
	
   

  	
   

  	
  Facsimile:

  	
  (212) 751-4864

  



 


 


11





















 


or
such other address as the recipient party to whom notice is to be given may
have furnished to the other party in writing in accordance herewith.  Any such communication shall deemed to have
been delivered and received (a) in the case of personal delivery, on the date
of such delivery, (b) in the case of delivery by mail, on the third Business
Day following such mailing, (c) if telecopied, on the date telecopied, and (d)
in the case of delivery by nationally-recognized, overnight courier, on the
Business Day following dispatch.


(c)           Entire
Agreement.  This Agreement, the
Subscription Agreement, the Restricted Stock Agreement and the Stockholders
Agreement embody the complete agreement and understanding among the parties and
supersede and preempt any prior or contemporaneous understandings, agreements
or representations by or among the parties, written or oral, which may have
related to the subject matter hereof in any way.


(d)           Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.


(e)           Successors
and Assigns.  Except as otherwise
provided herein, this Agreement shall bind and inure to the benefit of and be
enforceable by the Executive and the Company and their respective successors,
assigns, heirs, representatives and estate, as the case may be; provided,
however, that the obligations of the Executive under this Agreement
shall not be assigned without the prior written consent of the Company.


(f)            Amendment
and Waiver.  The provisions of this
Agreement may be amended and waived only with the prior written consent of the
Company and the Executive, and no course of conduct or failure or delay in
enforcing the provisions of this Agreement shall affect the validity, binding
effect or enforceability of this Agreement or any provision hereof.


(g)           Governing
Law.  This Agreement shall be
governed by and construed in accordance with the domestic laws of the State of
Delaware without giving effect to any choice or conflict of law provision or
rule that would cause the application of the laws of any jurisdiction other
than the State of Delaware.


(h)           Descriptive
Headings; Nouns and Pronouns. 
Descriptive headings are for convenience only and shall not control or
affect the meaning or construction of any provision of this Agreement.  Whenever the context may require, any
pronouns used herein shall include the corresponding masculine, feminine or
neuter forms, and the singular form of nouns and pronouns shall include the
plural and vice-versa.


(i)            Non-Qualified
Deferred Compensation.  The parties
acknowledge and agree that, to the extent applicable, this Agreement shall be
interpreted in accordance with Section 409A of the Internal Revenue Code of
1986, as amended (the “Code”) and Department of Treasury regulations and other
interpretive guidance issued thereunder, including without limitation any such
regulations or other guidance that may be issued after the date hereof.  Notwithstanding any provision of this
Agreement to the contrary, in the event that the Company determines that any
amounts payable hereunder will be immediately taxable to the Executive under
Section 409A of the Code and related Department of Treasury guidance, the
Company may (a) adopt such amendments to this Agreement and appropriate
policies and procedures, including amendments 


 


 


12





















 


and policies with retroactive effect, that the Company
determines necessary or appropriate to preserve the intended tax treatment of
the benefits provided by this Agreement and/or (b) take such other actions as
the Company determines necessary or appropriate to comply with the requirements
of Section 409A of the Code and related Department of Treasury guidance,
including such Department of Treasury guidance and other interpretive materials
as may be issued after the date hereof.


(j)            Waiver
of Jury Trial.  EACH OF THE PARTIES
HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT.


*     *     *    
*     *


13





















IN
WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first written above.


	
   

  	
  PQ
  CORPORATION

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  William J. Sichko, Jr.

  
	
   

  	
   

  	
  Name:
  William J. Sichko, Jr.

  
	
   

  	
   

  	
  Title:
  Chief Administrative Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/
  Scott H. Randolph

  
	
   

  	
  Scott
  H. Randolph, individually

  



 


 


 





















 


SCHEDULE
1


 


Non-Compete
Agreement with Peak Lime, Inc. dated December 31, 2001


 


 


 





















 


EXHIBIT
A


 


 


FORM OF
GENERAL RELEASE AND WAIVER OF CLAIMS


 


This General Release and Waiver of Claims (hereafter “Agreement”) is
entered into by and between PQ Corporation, a Pennsylvania corporation (the “Company”)
and ________________________ (the “Employee”) on _________________.


In consideration of the mutual promises and covenants contained herein
and in the Employment Agreement by and between the Company and the Employee
dated ________________ (the “Employment Agreement”), and other good and
valuable consideration, the receipt of which hereby is acknowledged, the
parties agree as follows:


Section 1.               Release
and Waiver of Claims.  Effective as
of ____________________, in consideration of the payments, benefits, and other
considerations provided to the Employee under the Employment Agreement, the
Employee, for the Employee and the Employee’s family, heirs, executors,
administrators, legal representatives, and their respective successors and
assigns, hereby releases and forever discharges the Company, and all of its
subsidiaries, officers, directors, employees, agents, stockholders,
representatives, and their successors and assigns (collectively, “Company
Entities”), from all rights, claims or demands the Employee may have, arising
at any time on or before the date hereof, based on or arising out of the
Employee’s employment with any Company Entity or the termination of that
employment, including without limitation any claims under the Employment
Agreement, or based on any services provided to any Company Entity by the
Employee other than pursuant to an employment relationship with any Company
Entity.  This includes a release of any
and all rights, claims or demands the Employee may have, whether known or
unknown, under the Age Discrimination in Employment Act (“ADEA”), which
prohibits age discrimination in employment; Title VII of the Civil Rights Act
of 1964, which prohibits discrimination in employment based on race, color,
national origin, religion or sex; the Equal Pay Act, which prohibits paying men
and women unequal pay for equal work; or under any other federal, state or
local laws or regulations regarding employment discrimination or termination of
employment.  This also includes a release
by the Employee of any claims for wrongful discharge or discrimination under
any statute, rule, regulation or under the common law, including, without
limitation, the Sarbanes-Oxley Act.  The
Employee hereby agrees never individually or with any person to file, or
commence the filing of, any charges, lawsuits, complaints or proceedings with
any governmental agency, or against any Company Entity, with respect to any of
the matters released by the Employee pursuant to this Section 1.


Section 2.               Rights
Not Released or Waived.  Section 1
hereof notwithstanding, by signing this Agreement the Employee shall not have
relinquished any right to enforce the provisions of this Agreement.


Section 3.               Release
and Waiver of Claims Under the Age Discrimination in Employment Act.  The Employee acknowledges that the Company
has encouraged the Employee to consult with an attorney of the Employee’s
choosing and, through this Agreement, encourages the Employee to consult with
an attorney with respect to any possible claims the Employee may have, including
claims under the ADEA, as well as under the other federal, state and local laws
described in 


 





















 


Section 1 hereof.  The Employee
understands that by signing this Agreement the Employee is in fact waiving,
releasing and forever giving up any claim under the ADEA, as well as all other
federal, state and local laws described in Section 1 hereof that may have
existed on or prior to the date hereof.


Section 4.               Waiting
Period and Revocation Period.  The
Employee hereby acknowledges that the Company has informed the Employee that
the Employee has up to twenty-one (21) days to consider this Agreement
and the Employee may knowingly and voluntarily waive that twenty-one (21) day
period by signing this Agreement earlier. 
The Employee also understands that the Employee shall have seven (7)
days following the date on which the Employee signs this Agreement within which
to revoke it by providing a written notice of revocation to the Company.


Section 5.               Acceptance.  To accept this Agreement, the Employee shall
execute and date this Agreement on the spaces provided and return a copy to the
Company at any time during the twenty-one (21) day period commencing on the
date hereof.  This Agreement shall take
effect on the eighth day following the Employee’s execution of this Agreement
unless the Employee’s written revocation is delivered to the Company within
seven (7) days after such execution.


Section 6.               Entire
Agreement.  This Agreement represents
the entire agreement of the parties with respect to the Employee’s employment
and termination thereof.  Except as
specifically provided herein, this Agreement shall supersede any written
employment agreement between the parties hereto in all respects effective as of
the date hereof.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE
OF ________________ APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE.


IN
WITNESS WHEREOF, and with the intention of being legally bound
hereby, the Employee has executed this General Release and Waiver of Claims.


 


_______________________________________                     Date:_________________________


[Employee]


 


 


A-2