exhibit105






 

 

1 
EXHIBIT 10.5 
CHANGE IN CONTROL AGREEMENT 
 
THIS AGREEMENT, dated 
June 23, 2022 between QUAKER CHEMICAL CORPORATION, 
d/b/a QUAKER 
HOUGHTON, a Pennsylvania corporation (the “Company”), 
and DHRUWA 
RAI (the “Manager”), 
W I T N E S S E T H 
T H A T 
 
WHEREAS, the Board of Directors of the Company has determined that 
it is in the best interests of the Company and its 
shareholders that the Company and its subsidiaries be able to attract, retain, 
and motivate highly qualified management personnel and, 
in particular, that they be assured of continuity 
of management in the event of any actual or threatened change in control of 
the 
Company; and 
WHEREAS, the Board of Directors of the Company believes that the execution 
by the Company of change in control 
agreements with certain management personnel, including the Manager, 
is an important factor in achieving this desired end; 
 
NOW, THEREFORE, 
IN CONSIDERATION 
of the mutual obligations and agreements contained herein 
and intending to be 
legally bound hereby, 
the Manager and the Company agree that the Change in Control Agreement is amended 
and restated, as follows: 
1.
Term 
of Agreement. 
 
This Agreement shall become effective on your start date with 
the Company (the “Effective Date”), and shall continue in 
effect through December 31, 2022, provided, however, 
that the term of this Agreement shall automatically be extended for successive 
one-year periods thereafter, unless, not later than 
eighteen (18) months preceding the calendar year for which the term would 
otherwise automatically extend, the Company shall have given written notice 
to the Manager of intention not to extend this Agreement 
for an additional year, in which event this Agreement 
shall continue in effect until December 31 of the calendar year immediately 
preceding the calendar year for which the term would have otherwise automatically 
extended. 
Notwithstanding any such notice not to 
extend, if a Change in Control (as defined in Section 2) occurs during the original 
or extended term of this Agreement, this Agreement 
shall remain in effect after a Change in Control until all obligations of the parties 
hereto under this Agreement shall have been 
satisfied. 
2.
Change in Control. 
 
As used in this Agreement, a “Change in Control” of the Company 
shall be deemed to have occurred if: 
(a)
Any person (a “Person”), as such term is used in Sections 13(d) and 14(d) of the Securities Exchange 
Act of 1934, 
as amended (the “Exchange Act”) (other than (i) the Company and/or 
its wholly owned subsidiaries; (ii) any ESOP or other employee 
benefit plan of the Company and any trustee or other fiduciary in such capacity 
holding securities under such plan; (iii) any 
corporation owned, directly or indirectly, 
by the shareholders of the Company in substantially the same proportions as their ownership 
of stock of the Company; or (iv) any other Person who, within the one year prior 
to the event which would otherwise be a Change in 
Control, is an executive officer of the Company or any 
group of Persons of which he voluntarily is a part), is or becomes the 
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or 
indirectly, of securities of the Company 
representing 30% or more of the combined voting power of the Company’s 
then outstanding securities or such lesser percentage of 
voting power, but not less than 15%, as determined 
by the members of the Board of Directors of the Company who are independent 
directors (as defined in the New York 
Stock Exchange, Inc. Listed Company Manual); provided, however, 
that a Change in Control 
shall not be deemed to have occurred under the provisions of this subsection 
(a) by reason of the beneficial ownership of voting 
securities by members of the Benoliel family (as defined below) unless and 
until the beneficial ownership of all members of the 
Benoliel family (including any other individuals or entities who or 
which, together with any member or members of the Benoliel 
family, are deemed under 
Sections 13(d) or 14(d) of the Exchange Act to constitute a single Person) exceeds 
50% of the combined 
voting power of the Company’s then 
outstanding securities; 
(b)
During any two-year period after the Effective 
Date, Directors of the Company in office at the beginning of such 
period plus any new Director (other than a Director designated by a Person 
who has entered into an agreement with the Company to 
effect a transaction within the purview of subsections (a) or 
(c)) whose election by the Board of Directors of the Company or whose 
nomination for election by the Company’s 
shareholders was approved by a vote of at least two-thirds of the Directors then still in 
office who either were Directors at the beginning of 
the period or whose election or nomination for election was previously so 
approved shall cease for any reason to constitute at least a majority of the Board; 







 

 

 

 

 

 

 

2 
(c)
The consummation of (i) any consolidation or merger of the Company 
in which the Company is not the continuing 
or surviving corporation or pursuant to which the Company’s 
voting common shares (the “Common Shares”) would be converted into 
cash, securities, and/or other property, 
other than a merger of the Company in which holders of Common 
Shares immediately prior to 
the merger have the same proportionate ownership of voting shares 
of the surviving corporation immediately after the merger as 
they 
had in the Common Shares immediately before; or (ii) any sale, lease, exchange, 
or other transfer (in one transaction or a series of 
related transactions) of all or substantially all the assets or earning power of the 
Company; or 
(d)
The Company’s shareholders 
or the Company’s Board of 
Directors shall approve the liquidation or dissolution of 
the Company. 
 

3.
Entitlement to Change in Control Benefits; Certain Definitions 
. 
 
The Manager shall be entitled to the benefits provided in this Agreement in 
the event the Manager has a Separation from 
Service under the circumstances described in (a) below (a “Covered Termination”), 
provided the Manager executes and does not 
revoke a Release (as defined below), if any, 
provided by the Company. 
(a)
A Covered Termination 
shall have occurred in the event the Manager’s employment 
with the Company or its 
affiliates is terminated within two (2) years following a Change 
in Control by: 
(i)
The Company or its affiliates without Cause (as defined below); 
or 
(ii)
Resignation of the Manager for Good Reason (as defined below).
 
The Manager shall have no rights to any payments or benefits under 
this Agreement in the event the Manager’s employment 
with the Company and its affiliates is terminated (i) as a result of death 
or Disability (as defined below), or (ii) by the Company or its 
affiliates for Cause. 
In the event the Manager’s employment is terminated for any reason prior 
to a Change in Control, the Manager 
shall have no rights to any payments or benefits under this Agreement and, after any 
such termination, this Agreement shall be of no 
further force or effect. 
“Cause” shall mean (i) the Manager’s willful and material breach 
of the employment agreement, if any, 
between the Manager 
and the Company (after having received notice thereof and a reasonable 
opportunity to cure or correct), (ii) dishonesty, 
fraud, willful 
malfeasance, gross negligence, or other gross misconduct, in each case relating 
to the performance of the Manager’s employment with 
the Company or its affiliates which is materially injurious to 
the Company, or (iii) conviction 
of or plea of guilty to a felony, 
such 
Cause to be determined, in each case, by a resolution approved by at least two-thirds 
of the Directors of the Company after having 
afforded the Manager a reasonable opportunity to appear 
before the Board of Directors of the Company and present his position. 
“Code” shall mean the Internal Revenue Code of 1986, as amended, together with 
any applicable regulations thereunder. 
“Disability” shall mean covered total and permanent disability as defined 
in the long-term disability plan maintained by the 
Company for employees generally or, if the 
Company does not maintain such a plan, the long-term disability plan most recently 
maintained by the Company for employees generally. 
“Good Reason” shall mean any of the following actions without the Manager’s 
consent, other than due to the Manager’s 
death or Disability: (i) any reduction in the Manager’s base salary from 
that provided immediately before the Covered Termination 
or, 
if higher, immediately before the Change 
in Control; (ii) any reduction in the Manager’s bonus opportunity (including 
cash and 
noncash incentives) or increase in the goals or standards required to accrue 
that opportunity, as compared 
to the opportunity and goals 
or standards in effect immediately before the Change 
in Control; (iii) a material adverse change in the nature or scope of the 
Manager’s authorities, powers, functions, or duties from 
those in effect immediately before the Change in Control; (iv) a reduction in 
the Manager’s benefits from those provided immediately before 
the Change in Control, disregarding any reduction under a plan or 
program covering employees generally that applies to all employees covered 
by the plan or program; or (v) the Manager being 
required to accept a primary employment location which is more than twenty-five 
(25) miles from the location at which he primarily 
was employed during the ninety (90) day period prior to a Change in Control. 

 
“Payment Date” shall mean the 60th day after the Manager’s Separation 
from Service, subject to Section 9. 
 
“Release” shall mean a release (in a form satisfactory to the Company) of 
any and all claims against the Company and all 
related parties with respect to all matters arising out of the Manager’s 
employment by the Company and its affiliates, or the 
termination thereof (other than claims for any entitlements under the terms of this Agreement, 
under any employment agreement 
between the Manager and the Company, 
or under any plans or programs of the Company under which the Manager 
has accrued a 






 

 

 

 

 

 

 

 

3 
benefit) that the Company provides to the Manager no later than three days after 
the date of the Manager’s Covered Termination. 

Notwithstanding any provision of this Agreement to the contrary, 
if the Company provides a Release to the Manager, the Manager 
shall not be entitled to any payments or benefits under this Agreement unless the Manager 
executes the Release within 45 days of the 
later of the date he receives the Release or the date of his Covered Termination, 
and the Manager does not revoke the Release. 
 
“Separation from Service” shall mean the Manager’s separation 
from service with the Company and its affiliates within the 
meaning of Treas. Reg. §1.409A-1(h) or 
any successor thereto. 
 
“Specified Employee” shall mean the Manager if he is a specified employee as defined 
in Section 409A of the Code as of the 
date of his Separation from Service. 

4.
Severance Allowance. 
(a)
Amount of Severance Allowance. 
In the event of a Covered Termination, 
the Company shall pay or cause to be 
paid to the Manager in cash a severance allowance (the “Severance Allowance”) 
equal to 1.5 (one and one-half) times the sum of the 
amounts determined in accordance with the following paragraphs (i) 
and (ii): 
(i)
An amount equivalent to the highest annualized base salary which the Manager 
was entitled to receive from 
the Company and its subsidiaries at any time during his employment prior 
to the Covered Termination; 
and 
(ii)
An amount equal to the average of the aggregate annual amounts paid 
to the Manager in the Applicable 
Three-Year 
Period under all applicable annual incentive compensation plans maintained by the 
Company 
and its affiliates (other than compensation relating to relocation 
expense; the grant, exercise, or settlement 
of stock options, restricted stock or performance incentive units or the sale or other 
disposition of shares 
received upon exercise or settlement of such awards); provided, however, 
that (x) in determining the 
average amount paid under the 
annual incentive plan during the Applicable Three-Year 
Period there shall 
be excluded any year in which no amounts were paid to the Manager under 
that plan; and (y) there shall be 
excluded from such calculation any amounts paid to the Manager under any 
such incentive compensation 
plan as a result of the acceleration of such payments under such plan due to termination 
of the plan, a 
Change in Control, or a similar occurrence. 
The Applicable Three-Year 
Period shall be (A) if the Manager 
has received an annual incentive compensation plan payment in the calendar year 
of his Covered 
Termination, 
the calendar year in which such Covered Termination 
occurs and the two preceding calendar 
years, or (B) in any other case, the three calendar years preceding the calendar 
year in which the Manager’s 
Covered Termination 
occurs; provided, however, that the Applicable Three 
-Year 
Period shall be 
determined by substituting “Change In Control” for “Covered Termination” 
if such substitution results in a 
higher amount under this subsection (ii). 

In no event shall any retention bonus or change in control or success fee be taken 
into account when determining the amount of the 
Severance Allowance hereunder. 
(b)
Payment of Severance Allowance. 
The Severance Allowance shall be paid to the Manager in a lump sum on the 
Payment Date if the applicable Change in Control is also a change in control event 
as defined in Treas. Reg. §1.409A-3(i)(5) (or any 
successor thereto). 
In any other case, the Severance Allowance shall be paid in eighteen monthly installments 
commencing on the 
Payment Date, each of which is equal to one eighteenth (1/18th) of the amount of 
the Severance Allowance determined under Section 
4(a), which are treated as a right to a series of separate payments for purposes of Section 
409A of the Code. 
5.
Outplacement and Welfare 
Benefits. 
(a)
Outplacement. 
Subject to Section 6, for a period of one year following a Covered Termination 
of the Manager, the 
Company shall make or cause to be made available to the Manager, 
at its expense, outplacement counseling and other outplacement 
services comparable to those available for the Company’s 
senior managers prior to the Change in Control. 
(b)
Welfare Benefits. 
Subject to Section 6, for a period eighteen months following a Covered Termination 
of the 
Manager, the Manager and the Manager’s 
dependents shall be entitled to participate in the Company’s 
life, medical, and dental 
insurance plans at the Company’s 
expense, in accordance with the terms of such plans at the time of such Covered Termination 
as if 
the Manager were still employed by the Company or its affiliates under 
this Agreement. 
If, however, life, medical, or dental insurance 
benefits are not paid or provided under any such plan to the Manager or his dependents 
because the Manager is no longer an employee 
of the Company or its subsidiaries, the Company itself shall, to the extent 
necessary, pay or otherwise 
provide for such benefits to the 
Manager and his dependents. 






 

 

 

 

 

 

4 
6.
Effect of Other Employment. 
 
In the event the Manager becomes employed (as defined below) during the period 
with respect to which benefits are 
continuing pursuant to Section 5: 
(a) the Manager shall notify the Company not later than the day such employment 
commences; and 
(b) the benefits provided for in Section 5 shall terminate as of the date of 
such employment. 
For the purposes of this Section 6, the 
Manager shall be deemed to have become “employed” by another entity 
or person only if the Manager becomes essentially a full-time 
employee of a person or an entity (not more than 30% of which is owned by the Manager 
and/or members of his family); and the 
Manager’s “family” shall mean his parents, his siblings and their 
spouses, his children and their spouses, and the Manager’s spouse 
and her parents and siblings. 
Nothing herein shall relieve the Company of its obligations for compensation 
or benefits accrued up to 
the time of termination provided for herein. 
7.
Other Payments and Benefits. 

 
On the Payment Date, the Company shall pay or cause to be paid to the Manager the 
aggregate of: 
(a) the Manager’s earned 
but unpaid base salary through the Covered Termination 
at the rate in effect on the date of the Covered Termination, 
or if higher, at 
the rate in effect at any time during the 90-day period preceding 
the Change in Control; (b) any unpaid bonus or annual incentive 
payable to the Manager in respect of the calendar year ending prior to the Covered Termination; 
(c) the pro rata portion of any and all 
unpaid bonuses and annual incentive awards for the calendar year in which the 
Covered Termination 
occurs, said pro rata portion to be 
calculated on the fractional portion (the numerator of said fraction being 
the number of days between January 1 and the date of the 
Covered Termination, 
and the denominator of which is 365) of the target bonuses or annual incentive 
awards for such calendar year; 
and (d) the pro rata portion of any and all awards under the Company’s 
long term incentive plan for the performance period(s) in 
which the Covered Termination 
occurs, said pro rata portion to be calculated on the fractional portion (the numerator 
of said fraction 
being the number of days between the first day of the applicable performance 
period and the date of the Covered Termination, 
and the 
denominator of which is the total number of days in the applicable performance 
period) of the amount of the award which would have 
been payable had (i) the Covered Termination 
not occurred, and (ii) the target level of performance been achieved 
for the applicable 
performance period. 
The Manager shall be entitled to receive any other payments or benefits that the Manager 
is entitled to pursuant 
to the express terms of any compensation or benefit plan or arrangement of 
the Company or any of its affiliates; provided that: (x) the 
Severance Allowance (i) shall be in lieu of any severance payments to which 
the Manager might otherwise be entitled under the terms 
of any severance pay plan, policy, 
or arrangement maintained by the Company or the employment agreement, 
if any, between the 
Manager and the Company, 
and (ii) shall be credited against any severance payments to which the Manager 
may be entitled by statute; 
(y) any annual incentive described in subsection (b) or (c) shall decrease (or shall 
be decreased by), but not below zero, the amount of 
the annual incentive payable (or paid) with respect to the same calendar year 
under the Company’s annual 
incentive plan (currently the 
2001 Global Annual Incentive Plan); and (z) any amount described in subsection (d) shall 
decrease (or shall be decreased by), but not 
below zero, the amount of the analogous performance award payable (or paid) 
with respect to the same performance period(s) under 
the Company’s long term incentive 
plan(s) (currently the 2011 Long-Term 
Performance Incentive Plan). 

8.
Death After Covered Termination 
. 
 
In the event the Manager dies after a Covered Termination 
occurs, (a) any payments due to the Manager under Section 4 and 
the first sentence of Section 7 and not paid prior to the Manager’s 
death shall be made to the person or persons who may be designated 
by the Manager in writing or, in the event he fails to 
so designate, to the Manager’s personal representatives, and (b) the Manager’s 
spouse and dependents shall be eligible for the welfare benefits described in 
Section 5(b). 
Payments pursuant to subsection (a) shall 
be made on the later of (i) the date payment would have been made to the Manager 
without regard to Section 9, or (ii) the date of the 
Manager’s death. 
9.
Certain Section 409A Rules. 

(a)
Specified Employee. 
Notwithstanding any provision of this Agreement to the contrary, 
if the Manager is a Specified 
Employee, any payment or benefit under this Agreement that constitutes deferred 
compensation subject to Section 409A of the Code 
and for which the payment event is Separation from Service shall not be made or provided 
before the date that is six months after the 
date of the Manager’s Separation from Service. 
Any payment or benefit that is delayed pursuant to this Section 9 shall be made 
or 
provided on the first business day of the seventh month following the month in 
which the Manager’s Separation from Service occurs. 

With respect to any cash payment delayed pursuant 
to this Section 9, the first payment shall include interest, at the Wall 
Street Journal 
Prime Rate published in the Wall 
Street Journal on the date of the Manager’s Covered Termination 
(or the previous business day if 
such date is not a business day), for the period from the date the payment would 
have been made but for this Section 9 through the 
date payment is made. 
The provisions of this Section 9 shall apply only to the extent required to avoid the 
Manager’s incurrence of 
any additional tax or interest under Section 409A of the Code. 
(b)
Reimbursement and In-Kind Benefits. 
Notwithstanding any provision of this Agreement to the contrary, 
with 
respect to in-kind benefits provided or expenses eligible for reimbursement 
under this Agreement which are subject to Section 409A 
of the Code, (i) the benefits provided or the amount of expenses eligible for 
reimbursement during any calendar year shall not affect 






 

 

 

 

 

 

5 
the benefits provided or expenses eligible for reimbursement in any other 
calendar year, except as otherwise provided 
in Treas. Reg. 
§1.409A-3(i)(1)(iv)(B), and (ii) the reimbursement of an eligible expense 
shall be made as soon as practicable after the Manager 
requests such reimbursement (subject to Section 9(a)), but not later than the 
December 31 following the calendar year in which the 
expense was incurred. 
(c)
Interpretation and Construction. 
This Agreement is intended to comply with Section 409A of the Code and shall be 
administered, interpreted and construed in accordance therewith to 
avoid the imposition of additional tax under Section 409A of the 
Code. 
(d)
10.
Confidentiality and Noncompetition. 
(a)
Confidential Information. 
The Manager acknowledges that information concerning the method 
and conduct of the 
Company’s (and any affiliate’s) 
business, including, without limitation, strategic and marketing plans, budgets, 
corporate practices and 
procedures, financial statements, customer and supplier information, 
formulae, formulation information, application technology, 
manufacturing information, and laboratory test methods and all of the 
Company’s (and any affiliate’s) 
manuals, documents, notes, 
letters, records, and computer programs (“Proprietary Business Information”), 
are the sole and exclusive property of the Company 
(and/or the Company’s affiliates, 
as the case may be) and are likely to constitute, contain or reveal trade secrets (“Trade 
Secrets”) of 
the Company (and/or the Company’s 
affiliate’s, as the case may 
be). 
The term “Trade Secrets” as used herein does not include 
Proprietary Business Information that is known or becomes known 
to the public through no act or failure to act on the part of the 
Manager, or which can be clearly shown 
by written records to have been known by the Manager prior to the commencement of 
his 
employment with the Company. 
(i)
The Manager agrees that at no time during or following his employment with the Company will he 
use, 
divulge, or pass on, directly or through any other individual or entity, 
any Trade Secrets. 

(ii)
Upon termination of the Manager’s employment with 
the Company regardless of the reason for the 
termination of the Manager’s employment hereunder, 
or at any other time upon the Company’s 
request, the 
Manager agrees to forthwith surrender to the Company any and all materials in 
his possession or control 
which constitute or contain any Proprietary Business Information. 
(b)
Noncompetition. 
The Manager agrees that during his employment and for a period of one (1) year thereafter, 
regardless of the reason for the termination of the Manager’s employment, 
he will not: 
(i)
directly or indirectly, 
together or separately or with any third party, 
whether as an individual proprietor, 
partner, stockholder, 
officer, director, 
joint venturer, investor, 
or in any other capacity whatsoever actively 
engage in business or assist anyone or any firm in business as a manufacturer, 
seller, or distributor of 
specialty chemical products or chemical management services which are 
the same, like, similar to, or which 
compete with the products and services offered by the Company 
(or any of its affiliates); 
(ii)
directly or indirectly recruit, solicit or encourage any employee of the Company (or 
any of its affiliates) or 
otherwise induce such employee to leave the employ of the Company (or any of its affiliates) 
or to become 
an employee or otherwise be associated with his or any firm, corporation, business 
or other entity with 
which he is or may become associated; or 
(iii)
solicit, directly or indirectly, 
for himself or as agent or employee of any person, partnership, corporation, 
or 
other entity (other than for the Company), any then or former customer, 
supplier, or client of the Company 
with the intent of actively engaging in business which would cause competitive 
harm to the Company (or 
any of its affiliates). 
(c)
Severability. 
The Manager acknowledges and agrees that all of the foregoing restrictions 
are reasonable as to the 
period of time and scope. 
However, if any paragraph, sentence, clause, or other provision 
is held invalid or unenforceable by a court 
of competent and relevant jurisdiction, such provision shall be deemed to 
be modified in a manner consistent with the intent of such 
original provision so as to make it valid and enforceable, and this Agreement and the 
application of such provision to persons and 
circumstances other than those with respect to which it would be invalid or unenforceable 
shall not be affected thereby. 
(d)
Remedies. 
The Manager agrees and recognizes that in the event of a breach or threatened breach 
of the provisions 
of the restrictive covenants contained in this Section 10, the Company 
may suffer irreparable harm, and monetary damages may not be 
an adequate remedy. 
Therefore, if any breach occurs or is threatened, the Company shall be entitled to seek equitable remedies, 






 

 

 

 

 

 

 

6 
including injunctive relief in any court of applicable jurisdiction notwithstanding 
the provisions of Section 12. 
In the event of any 
breach of the restrictive covenant contained in this Section 10, the term of 
the restrictive covenant specified herein shall be extended 
by a period of time equal to that period beginning on the date such violation 
commenced and ending when the activities constituting 
such violation cease. 
Furthermore, if a court or arbitration panel determines that the Manager has breached 
any of the provisions of 
this Section 10, the Company’s obligations 
to pay amounts and continue the benefits under this Agreement to the Manager (and 
his 
dependents) shall immediately terminate. 
11.
Set-Off Mitigation. 
 
Except as provided in Section 6, 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 Manager or others. 
In no event shall the Manager be obligated to seek other 
employment or take any other action by way of mitigation of the amounts payable 
to the Manager under any of the provisions of this 
Agreement. 
12.
Arbitration: 
Costs and Expenses of Enforcement. 
(a)
Arbitration. 
Except as otherwise provided in Sections 10(d) and 13, any controversy or claim arising 
out of or 
relating to this Agreement or the breach thereof which cannot promptly be 
resolved by the parties shall be promptly submitted to and 
settled exclusively by arbitration in the City of Philadelphia, Pennsylvania, 
in accordance with the laws of the Commonwealth of 
Pennsylvania by three arbitrators, one of whom shall be appointed by the Company, 
one by the Manager, and the third of whom 
shall 
be appointed by the first two arbitrators. 
The arbitration shall be conducted in accordance with the rules of the American Arbitration 
Association, except with respect to the selection of arbitrators which shall be as provided 
in this Section 12. 
Judgment upon the award 
rendered by the arbitrators may be entered in any court having jurisdiction thereof. 
(b)
Costs and Expenses. 
In the event that it shall be necessary or desirable for the Manager to retain legal 
counsel 
and/or incur other costs and expenses in connection with the enforcement 
of any and all of his rights under this Agreement at any time 
during his lifetime, the Company shall pay (or the Manager shall be entitled 
to recover from the Company, 
as the case may be) his 
reasonable attorneys’ fees and costs and expenses in connection with the 
enforcement of his said rights (including those incurred in or 
related to any arbitration proceedings provided for in subsection (a) and the enforcement 
of any arbitration award in court), regardless 
of the final outcome. 

13.
Limitation on Payment Obligation. 
(a)
Definitions. 
For purposes of this Section 13, all terms capitalized but not otherwise defined 
herein shall have the 
meanings as set forth in Section 280G of the Code. 
In addition: 
(i)
the term “Parachute Payment” shall mean a payment described in Section 
280G(b)(2)(A) or Section 
280G(b)(2)(B) of the Code (including, but not limited to, any stock option rights, 
stock grants, and other 
cash and noncash compensation amounts that are treated as payments 
under either such section) and not 
excluded under Section 280G(b)(4)(A) or Section 280G(b)(6) of 
the Code; 
(ii)
the term “Reasonable Compensation” shall mean reasonable compensation 
for prior personal services as 
defined in Section 280G(b)(4)(B) of the Code and subject to the requirement 
that any such reasonable 
compensation must be established by clear and convincing evidence; and 
(iii)
the portion of the “Base Amount” and the amount of “Reasonable Compensation” 
allocable to any 
“Parachute Payment” shall be determined in accordance with Section 280G(b)(3) 
and (4) of the Code. 
(b)
Limitation. 
Notwithstanding any other provision of this Agreement, Parachute Payments to be 
made to or for the 
benefit of the Manager but for this subsection (b), whether pursuant to 
this Agreement or otherwise, shall be reduced if and to the 
extent necessary so that the aggregate Present Value 
of all such Parachute Payments shall be at least one dollar ($1.00) less than the 
greater of (i) three times the Manager’s Base Amount and (ii) the aggregate 
Reasonable Compensation allocable to such Parachute 
Payments. 
Any reduction in Parachute Payments caused by reason of this subsection 
(b) shall be applied in the manner least 
economically detrimental to the Manager. 
In the event reduction of two or more types of payments would be economically 
equivalent, 
the reduction shall be applied pro-rata to such types of payments. 
 
This subsection (b) shall be interpreted and applied to limit the amounts otherwise payable 
to the Manager under this 
Agreement or otherwise only to the extent required to avoid any material 
risk of the imposition of excise taxes on the Manager under 
Section 4999 of the Code or the disallowance of a deduction to the Company under 
Section 280G(a) of the Code. 
In the making of 
any such interpretation and application, the Manager shall be presumed 
to be a disqualified individual for purposes of applying the 






 

 

 

 

 

 

 

 

7 
limitations set forth in this subsection (b) without regard to whether or not 
the Manager meets the definition of disqualified individual 
set forth in Section 280G(c) of the Code. 
In the event that the Manager and the Company are unable to agree as to the application 
of 
this subsection (b), the Company’s 
independent auditors shall select independent tax counsel to determine 
the amount of such limits. 

Such selection of tax counsel shall be subject to the Manager’s consent, 
provided that the Manager shall not unreasonably withhold his 
consent. 
The determination of such tax counsel under this Section 13 shall be final and binding 
upon the Manager and the Company. 
(c)
Illegal Payments. 
Notwithstanding any other provision of this Agreement, no payment shall be made 
hereunder to 
or for the benefit of the Manager if and to the extent that such payments are determined 
to be illegal. 
14.
Notices. 
 
Any notices, requests, demands, and other communications provided 
for by this Agreement shall be sufficient if in writing, 
and if hand delivered or if sent by registered or certified mail, if to the Manager, 
at the last address he had filed in writing with the 
Company or if to the Company, 
at its principal executive offices. 
Notices, requests, etc. shall be effective when actually received 
by 
the addressee or at such address. 
15.
Withholding. 
 
Notwithstanding any provision of this Agreement to the contrary, 
the Company may, to the extent required 
by law, withhold 
applicable Federal, state and local income and other taxes from any payments 
due to the Manager hereunder. 
16.
Assignment and Benefit. 
(a)
This Agreement is personal to the Manager and shall not be assignable by the 
Manager, by operation of law, 
or 
otherwise without the prior written consent of the Company otherwise than 
by will or the laws of descent and distribution. 
This 
Agreement shall inure to the benefit of and be enforceable by the Manager’s 
heirs and legal representatives. 
(b)
This Agreement shall inure to the benefit of and be binding upon the Company 
and its successors and assigns, 
including, without limitation, any subsidiary of the Company to which 
the Company may assign any of its rights hereunder; provided, 
however, that no assignment of this Agreement 
by the Company, by operation of law, 
or otherwise shall relieve it of its obligations 
hereunder except an assignment of this Agreement to, and its assumption by, 
a successor pursuant to subsection (c). 
(c)
The Company shall require any successor (whether direct or indirect, 
by purchase, merger, consolidation, 
operation 
of law, 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, but, irrespective of any such assignment or assumption, this Agreement 
shall inure to the benefit of and be binding upon 
such a successor. 
As used in this Agreement, “Company” shall mean the Company as hereinbefore defined 
and any successor to its 
business and/or assets as aforesaid. 
17.
Governing Law. 
 
The provisions of this Agreement shall be construed in accordance with the laws of 
the Commonwealth of Pennsylvania 
without reference to principles of conflicts of laws. 
18.
Entire Agreement; 
Amendment. 
(a)
Except for the change in control provisions set forth in the Company’s 
annual incentive plan and long term incentive 
plans, this Agreement represents the entire agreement and understanding of 
the parties with respect to the subject matter hereof. 
The 
Manager understands and acknowledges that the Company’s 
severance plan, annual incentive plan and long term incentive plans are 
hereby amended with respect to the Manager to avoid duplication of benefits, 
as provided in Section 7. 
(b)
The Company reserves the right to unilaterally amend this Agreement without the 
consent of the Manager to the 
extent the Compensation/Management Development Committee of 
the Company’s Board of Directors 
(in its sole discretion) 
determines is necessary or appropriate to avoid the additional tax under Section 409A(a)(1)(B) 
of the Code; otherwise, this Agreement 
may not be altered or amended except by an agreement in writing executed by 
the Company and the Manager. 
19.
No Waiver. 
 
The failure to insist upon strict compliance with any provision of this Agreement 
by any party shall not be deemed to be a 
waiver of any future noncompliance with such provision or of noncompliance 
with any other provision. 
20.
Severability. 






 

8 
 
In the event that any provision or portion of this Agreement shall be determined to 
be invalid or unenforceable for any 
reason, the remaining provisions of this Agreement shall be unaffected 
thereby and shall remain in full force and effect. 
21.
Indemnification. 

 
The Company shall defend and hold the Manager harmless to the fullest extent permitted 
by applicable law in connection 
with any claim, action, suit, investigation or proceeding arising out of or relating 
to performance by the Manager of services for, or 
action of the Manager as a director, officer 
or employee of the Company or any parent, subsidiary or affiliate of 
the Company, or of 
any other person or enterprise at the Company’s 
request. 
Expenses incurred by the Manager in defending such a claim, action, suit or 
investigation or criminal proceeding shall be paid by the Company in advance 
of the final disposition thereof upon the receipt by the 
Company of an undertaking by or on behalf of the Manager to repay 
said amount unless it shall ultimately be determined that the 
Manager is entitled to be indemnified hereunder; provided, however, 
that this shall not apply to a nonderivative action commenced by 
the Company 
against the Manager. 
 
IN WITNESS WHEREOF, 
the Manager has hereunto set his hand and, pursuant to the authorization from 
its Board of 
Directors, the Company has caused these presents to be executed in its name and on its behalf 
and attested by its Secretary or Assistant 
Secretary, all as of the day 
and year first above written. 
 
MANAGER 
 
/s/ Dhruwa Rai 
 
QUAKER CHEMICAL CORPORATION 
 
By: /s/ Robert T. Traub 
 
Title: SVP, 
General Counsel and Corporate Secretary