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                                                                EXHIBIT 10.16(b)

                           FIRST AMENDMENT TO DEFERRED
                             COMPENSATION AGREEMENT

                  THIS AMENDMENT to the Deferred Compensation Agreement made
this 13th day of July, 2000, by and between Pennzoil-Quaker State Company, a
Delaware corporation (the "Company"), and James J. Postl ("Employee").

                                    RECITALS:

                  WHEREAS, the Company and Employee have previously entered into
that certain Deferred Compensation Agreement made the 4th day of May, 2000; and

                  WHEREAS, the Board of Directors of the Company has authorized
the amendment of the Deferred Compensation Agreement and Employee is agreeable
to the amendment.

                  NOW, THEREFORE, in consideration of the premises, effective as
of the date first written above, the Company and Employee agree as follows:

         1. The second sentence of paragraph (2) of the Deferred Compensation
Agreement is hereby amended to read as follows:

         "Employee shall be entitled to participate in all such employee benefit
         plans and programs of the Company as may be in effect from time to
         time, including, but not limited to, the Pennzoil-Quaker State Company
         Salaried Employees Retirement Plan (the 'Retirement Plan'), the
         Pennzoil-Quaker State Company Savings and Investment Plan (the 'Savings
         and Investment Plan'), the group disability plans (i.e., the
         'Short-Term Disability Plan'), the Excess Benefit Agreement between the
         Company and Employee, the group life insurance plan and the group
         hospitalization and medical benefits plan."

         2. Paragraph (3) of the Deferred Compensation Agreement is hereby
amended to read as follows:

                  "(3) Benefit. If Employee shall continue in the employment of
         the Company from the date hereof until he shall have reached age 65 or
         such earlier age as may be specifically agreed to in writing by the
         Board of Directors, then upon Employee's termination of employment with
         the Company for any reason other than death at any time thereafter,
         Employee shall be entitled to monthly payments of deferred compensation
         for the remainder of his life equal to the excess of (a) 57% of the sum
         of (i) Employee's monthly salary as in effect on the date of his
         termination of employment and (ii) the average one-twelfth of the
         annual bonuses paid to Employee for the three calendar years preceding
         the year in which his termination of employment occurs, over (b) the
         total of the monthly amounts payable to Employee during each applicable
         month from the Retirement<PAGE>   1
                                                                   EXHIBIT 10.17

                                    AGREEMENT

                  THIS AGREEMENT, effective as of the 8th day of November, 1999
(the "Effective Date"), by and between Pennzoil-Quaker State Company, a Delaware
corporation (hereinafter called the "Company"), and James W. Shaddix
(hereinafter called "Employee");

                                   WITNESSETH:

                  WHEREAS, Employee has previously entered into an agreement
with Pennzoil Company, the former parent of the Company, which agreement (the
"Original Agreement") provided certain medical and retirement benefits as
additional compensation for past and future services rendered and to be rendered
by Employee; and

                  WHEREAS, pursuant to the Agreement and Plan of Merger, dated
as of April 14, 1998, among Pennzoil Company, Pennzoil Products Company,
Downstream Merger Company and Quaker State Corporation ("Merger Agreement"), the
Company assumed certain employee benefit obligations of Pennzoil Company in
connection with the merger, and

                  WHEREAS, the Company assumed the obligations of Pennzoil
Company under the Original Agreement by an agreement dated as of December 30,
1998 (the "Prior Agreement"); and

                  WHEREAS, the Company and Employee desire to amend and restate
the Prior Agreement to make certain modifications as set forth herein;

                  NOW, THEREFORE, in consideration of the premises and the
agreements hereinafter contained, the parties hereto agree as follows:

                  1. Status of Agreement: This Agreement supersedes the Prior
Agreement between Employee and the Company and Employee waives the benefits and
contracts under the Prior Agreement in exchange for this Agreement. The
liability, if any, for benefits earned under the

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Original Agreement were assumed by the Company in the Prior Agreement pursuant
to the Merger Agreement, and such benefits as modified herein are included under
this Agreement. No benefits will be paid to Employee (or Employee's spouse or
dependents) by Pennzoil Company under the Original Agreement or the Company
under the Prior Agreement.

                  2. Disability: For purposes of this Agreement, "Disability"
shall have the meaning set forth in the Company's Supplemental Long Term
Disability Plan.

                  3. Termination of Employment:

                  (a) By the Company for Due Cause. If Employee is terminated by
         the Company for Due Cause, he shall be entitled to no benefits under
         this Agreement. The term "Due Cause" as used herein, shall mean (x)
         Employee has committed a willful serious act, such as embezzlement,
         against the Company intending to enrich himself at the expense of the
         Company or has been convicted of a felony involving moral turpitude or
         (y) Employee, in carrying out his duties hereunder, has been guilty of
         (i) willful, gross neglect or (ii) willful, gross misconduct resulting
         in either case in material harm to the Company; provided, in any event,
         Employee shall be given written notice by a majority of the Board of
         Directors of the Company that it intends to terminate Employee's
         employment for Due Cause under this Paragraph 4(a), which notice shall
         specify the act, or acts, on the basis of which the majority of the
         Board of Directors of the Company intends so to terminate Employee's
         employment, and Employee shall then be given the opportunity, within
         fifteen days of his receipt of such notice, to have a meeting with the
         Board of Directors of the Company to discuss such act, or acts. If the
         basis of such written notice is an act, or acts, other than an act, or
         acts, described in clause (x), above, the employee shall be given seven
         days after such meeting

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         within which to cease, or correct, the performance (or nonperformance)
         giving rise to such written notice, and upon failure of Employee within
         such seven days to cease, or correct, such performance (or
         nonperformance), Employee's employment by the Company shall
         automatically be terminated hereunder for Due Cause.

                  (b) By Death or Disability. In the event of the Death of
         Employee or Disability while employed by the Company, Employee shall be
         entitled to receive severance benefits provided in Paragraph 4,
         supplemental retirement benefits provided in Paragraph 5 and the
         additional medical benefits provided in Paragraph 6.

                  (c) Voluntarily By Employee. If Employee terminates his
         employment voluntarily, Employee shall be entitled to the severance
         benefits provided in Paragraph 4, supplemental retirement benefits
         provided in Paragraph 5 and the additional medical benefits provided in
         Paragraph 6.

                  (d) By Company Other Than For Due Cause. If Employee's
         employment with the Company is terminated by the Company for any reason
         other than as provided in Paragraph 3(a) hereof, the Company shall
         provide to Employee severance benefits provided in Paragraph 4,
         supplemental retirement benefits provided in Paragraph 5 and the
         additional medical benefits provided in Paragraph 6.

                  (e) Effect on Agreement. Termination of employment shall not
         constitute termination of this Agreement.

                  4. Severance Benefits: The Employee shall be entitled to
severance benefits, payable in a cash lump sum within five days of a termination
of Employee's employment entitling the Employee to such benefits, in an amount
equal to three times the greater of (x) Employee's rate

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of salary as in effect on the Effective Date of this Agreement or (y) the
Employee's highest rate of salary in effect at any time after the Effective
Date. Such severance benefits shall be reduced by any such benefits provided
under the Company's Executive Severance Plan.

                  5. Retirement Benefits: The Employee shall be entitled to
supplemental retirement benefits, payable at such time or times as benefits are
received under the Company's tax qualified defined benefit plan, determined as
(i) 57% of the greater of (x) Employee's rate of salary as in effect on the
Effective Date of this Agreement or (y) the Employee's highest rate of salary in
effect at any time after the Effective Date ("Employee's Amount") less (ii) the
benefit he actually receives from the Company's tax qualified defined benefit
plans, the excess benefit arrangement between Employee and the Company and
amounts received by Employee following timely application for benefits from
United States Social Security. Upon Employee's death, if Employee's spouse as of
the Effective Date survives Employee, such spouse will be entitled to
supplemental benefits for her life in an amount equal to (i) one-half of the
Employee's Amount that was being paid to the Employee as of the date of
Employee's death ("Spouse's Amount"), unless Employee's death occurs prior to
the date Employee would have attained age 55, in which event the Spouse's Amount
will commence to be paid upon the date the Employee would have attained age 55
as if the Employee had survived to that date, the Employee Amount had begun to
be paid, and the Employee died immediately thereafter, less (ii) the benefit
actually received from the Company's tax qualified retirement plans, the excess
benefit agreement between Employee and the Company and amounts received by such
spouse following timely application by such spouse for benefits from United
States Social Security.

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                  6. Medical Benefits: The Company shall provide to Employee,
Employee's spouse as of the Effective Date and eligible dependents which are
children of Employee or Employee's spouse ("dependent" as defined in IRC Section
152), continued medical benefits and medical benefits coverages (including
dental benefits) on terms and conditions and at benefit levels no less favorable
than those provided to Employee by the Company under the Pennzoil-Quaker State
Company Medical Expenses Reimbursement Plan (a copy of which is attached and
made a part of this Agreement) in effect as of the Effective Date. This coverage
shall be provided without any cost (including, but not limited to, premiums,
deductibles, etc.) to Employee, Employee's spouse and eligible dependent
children, and the benefits shall continue for the lifetimes of each of the
Employee, Employee's spouse and eligible dependent children (but in the case of
such children only for so long as they qualify as dependents).

                  7. No Offsets: The benefits provided under Paragraphs 4, 5 and
6 hereunder shall not be subject to an offset or reduction by reason of any
benefits or payments made by or under any other Company plan, program, practice
or arrangement or a plan, program, practice or arrangement maintained by any
other employer or otherwise, except as specifically provided herein.

                  8. Prohibition Against Assignment: The right of Employee to
benefits under this Agreement shall not be assigned, transferred, pledged or
encumbered in any way and any attempt at assignment, transfer, pledge,
encumbrance or other disposition of such benefits shall be null and void and
without effect.

                  9. Binding Effect: This Agreement shall be binding upon and
enure to the benefit of the Company, its successors and assigns, and Employee,
his heirs, executors, administrators and legal representatives.

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                  10. Governing Law: This Agreement shall be governed by and
construed in accordance with the laws of the State of Texas.

                  11. Severability: The invalidity or unenforceability of any
provision hereof shall in no way affect the validity or enforceability of any
other provision.

                  12. Amendment or Termination: This Agreement may be amended
only by mutual consent of the parties hereto evidenced in writing.

                  IN WITNESS WHEREOF, the parties have executed this Agreement
(in multiple copies).

                                                 PENNZOIL-QUAKER STATE COMPANY

/s/  James W. Shaddix                            By /s/ James L. Pate
-------------------------                           ----------------------------
James W. Shaddix                                       James L. Pate
                                                       Chairman of the Board
                                                       Chief Executive Officer

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<PAGE>   7

                          PENNZOIL-QUAKER STATE COMPANY

                       MEDICAL EXPENSES REIMBURSEMENT PLAN

I.       PURPOSES OF PLAN, DEFINITIONS AND DURATION.

         1.1 Purposes. This Medical Expenses Reimbursement Plan (the "Plan") of
Pennzoil-Quaker State Company (the "Company") for selected executives is
intended to attract and retain executives of outstanding competence and ability
by providing financial protection against medical expenses of such executives,
their spouses and dependents.

         1.2 Definitions.

                  (a) "Company" means Pennzoil-Quaker State Company or any
         successor.

                  (b) "Subsidiary" means any corporation in which the Company
         owns, directly or indirectly, stock possessing 50% or more of the total
         combined voting power of all classes of stock or any affiliated company
         which is controlled by the Company by reason of a management contract
         and stock ownership.

                  (c) "Board" means the Board of Directors of the Company.

                  (d) "Closing Date" means the date of Closing as described in
         the Agreement and Plan of Merger, dated as of April 14, 1998, among
         Pennzoil Company, Pennzoil Products Company, Downstream Merger Company
         and Quaker State Corporation ("Merger Agreement").

                  (e) "Employee" means any person, including an officer of the
         Company or any Subsidiary (whether or not he is also a director
         thereof), who, at the time such person is designated a Participant
         hereunder, is employed by the Company or any Subsidiary on a full-time
         basis, who is compensated for such employment by a regular salary and
         who, in the opinion of the Committee, is one of the officers or other
         key executives of the Company or any Subsidiary in a position to
         contribute materially to the continued growth and development and to
         the future financial success of the Company.

                  (f) "Participant" means an Employee who has been designated by
         the Committee to participate in the Plan.

                  (g) "Medical Expenses" means amounts paid for the diagnosis,
         cure, mitigation, treatment, or prevention of disease, and for other
         "medical care" as such term is defined in Section 213(e)(1) of the
         Internal Revenue Code of 1986, as amended.

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                  (h) "Dependent" means any person who is a "dependent" of a
         Participant within the meaning of the term "dependent" as defined in
         Section 152 of the Internal Revenue Code 1986, as amended.

                  (i) "Spouse" means the person to whom a Participant is then
         married and not legally separated under a decree of divorce or separate
         maintenance.

         1.3 Term. The effective date of the Plan is the Closing Date. The Plan
shall continue until terminated by the Board as herein provided.

II.      ADMINISTRATION OF THE PLAN - COMMITTEE.

         2.1 Appointment of Committee. The Plan shall be administered by the
Compensation Committee or such other committee of the Board as may be designated
by the Board from time to time (the "Committee").

         2.2 Committee Powers. The Committee shall be deemed to have and to be
exercising all of the powers of the Board in the performance of any of the
powers and duties delegated to it under the Plan, including, but without
limiting the generality of the foregoing, the selection of Participants. The
Committee may from time to time establish rules for the administration of the
Plan which are not inconsistent with the provisions and purposes of the Plan.

         2.3 Committee Action. A majority of the members of the Committee shall
constitutes a quorum for the transaction of business. All action taken by the
Committee at a meeting shall be by the vote of a majority of those present at
such meeting, but any action may be taken by the Committee without a meeting
upon written consent signed by all of the members of the Committee. Members of
the Committee may participate in a meeting by means of conference telephone or
similar communications equipment by means of which all persons participating in
the meeting can hear each other.

         2.4 Committee Determinations Conclusive. The determination of the
Committee as to any disputed question of construction or interpretation arising
under the Plan shall be final, binding, and conclusive upon all persons.

III.     COVERAGE OF THE PLAN.

         3.1 Persons Covered. Each person who is designated as a Participant and
the Spouse and Dependents of each such Participant shall be eligible for
benefits under this Plan from and after the Effective Date or such later date as
may be designated as the commencement date of his coverage under this Plan.

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         3.2 Termination of Coverage. Coverage under this Plan of any
Participant, his Spouse and Dependents shall terminate upon the death,
resignation or other termination of such Participant's employment with the
Company.

IV.      BENEFITS.

         4.1 Reimbursable Medical Expenses. The Company shall reimburse each
Participant for Medical Expenses incurred by such Participant, his Spouse or any
of his Dependents during the time such Participant was covered under this Plan
or under the PennzEnergy Medical Expenses Reimbursement Plan (formerly, the
Pennzoil Company Medical Expenses Reimbursement Plan) to the extent that such
Medical Expenses are or were not otherwise paid or reimbursed by group
hospitalization or other medical benefits insurance or plan or program provided
by the Company or it's former parent, PennzEnergy Company (formerly Pennzoil
Company). Notwithstanding the foregoing, Medical Expenses incurred prior to the
Closing Date will only be reimbursed to the extent required under the Merger
Agreement.

         4.2 Payment Procedure. Each Participant entitled to payments for
Reimbursable Medical Expenses under this Plan shall request such payments in
writing in such form as may be prescribed by the Committee and shall support
such request with such invoices and other documents as may be required by the
Committee. Upon receipt of satisfactory proof of payment of Reimbursable Medical
Expenses of a Participant, his Spouse or a Dependent, the Company shall
reimburse such Participant therefor as soon as practicable.

V.       RIGHTS OF PARTICIPANTS.

         5.1 Limitation of Rights. Nothing in this Plan shall be construed to:

                  (a) Give any Employee of the Company or a Subsidiary any right
         to participate in this Plan; or

                  (b) Limit in any way the right of the Company or any
         Subsidiary to terminate a Participant's employment with the Company or
         any Subsidiary at any time; or

                  (c) Give a Participant any interest in any fund or in any
         specific asset or assets of the Company or any Subsidiary; or

                  (d) Be evidence of any agreement or understanding, express or
         implied, that the Company or any Subsidiary will employ a Participant
         in any particular position or at any particular rate of remuneration.

         5.2 Nonalienation of Benefits. No right or benefit under this Plan
shall be subject to anticipation, alienation, sale, assignment, pledge,
encumbrance or charge of any nature, and any attempt to anticipate, alienate,
sell, assign, pledge, encumber or charge the same will be void. No

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night or benefit hereunder shall in any manner be liable for or subject to any
debts, contracts, liabilities or torts of the person entitled to such benefits.

VI.      MISCELLANEOUS.

         6.1 Amendment or Termination of the Plan. The Board may amend or
terminate this Plan at any time. Any such amendment or termination shall not,
however, affect any right to claim reimbursement of Medical Expenses incurred
prior thereto.

         6.2 Reliance upon Information. The Board and the Committee shall not be
liable for any decision or action taken in good faith in connection with the
administration of this Plan. Without limiting the generality of the foregoing,
any such decision or action taken by the Board or the Committee in reliance upon
any information supplied to them by an officer of the Company, the Company's
legal counsel or by the Company's independent accountants in connection with the
administration of this Plan shall be deemed to have been taken in good faith.

         6.3 Applicable Laws. This Plan shall be construed, administered and
governed in all respects under the laws of the State of Texas.

                                                   PENNZOIL-QUAKER STATE COMPANY

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