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                                                                    EXHIBIT 4.11

                              EMPLOYMENT AGREEMENT

      THIS EMPLOYMENT AGREEMENT (this "AGREEMENT") is made and entered into as
of the _1st__ day of _SEPTEMBER__, 2004 (the "EFFECTIVE DATE"), by and between
JAMES HARDIE BUILDING PRODUCTS, INC., a California corporation (the "COMPANY")
and LOUIS GRIES, a resident of California (the "EXECUTIVE").

                                    RECITALS

      The Company and the Executive desire to enter into this Agreement to
establish the terms and conditions of the Executive's employment by the Company
during the term hereof.

      The Executive will have responsibilities for activities in companies in
the James Hardie group in addition to those owed to the Company - these
companies together with the Company are referred to in this Agreement as the
"Group".

                                    AGREEMENT

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

                                    ARTICLE I
                                     DUTIES

      1.01  Duties. The Company hereby employs the Executive, and the Executive
hereby accepts such employment, as the Company's Executive Vice President --
Operations upon the terms and subject to the conditions set forth in this
Agreement. The Executive will report directly to the Chief Executive Officer.
The Executive shall perform such other or different duties and functions
consistent with his role as Executive Vice President -- Operations as may from
time to time be assigned to him by the Company's Chief Executive Officer or
Board of Directors.

      1.02  Other Business.

            (a)   During the term of this Agreement, the Executive agrees that
during the course of the Company's business hours, he will devote the whole of
his time, attention and efforts to the performance of his duties and obligations
hereunder. The Executive shall not, during the term of this Agreement, engage in
any activity which materially interferes with his performance of duties assigned
the Executive hereunder.

            (b)   The Executive shall not, during the term of this Agreement,
without the written approval of the Chief Executive Officer and obtained in each
instance, directly or indirectly (i) accept employment or receive any
compensation for the performance of services from any business enterprise other
than the Company or the Group, or (ii) enter into or be
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concerned or interested in any trade or business or public or private work
(whether for profit or otherwise and whether as partner, principal shareholder
or otherwise), which may, in the absolute discretion of the Chief Executive
Officer, hinder or otherwise interfere with the performance by the Executive of
his duties and obligations hereunder, except as a holder of not more than five
percent (5%) of any class of stock or other securities in any company which is
listed and or traded on any securities market. Nothing in this Section 1.02(b)
prevents the Executive from carrying out up to 15 hours per week of unpaid
employment with religious, not for profit or voluntary organizations.

                                   ARTICLE II
                                TERM OF AGREEMENT

      The term of this Agreement shall commence on the Effective Date and shall
continue in full force and effect until the Executive leaves employment with the
Company for any reason, including but not limited to resignation, termination,
death or disability. The provisions of Article V of the Agreement will continue
in full force and effect after the termination of the Agreement in accordance
with the provisions thereof.

                                   ARTICLE III
                                  COMPENSATION

      During the term of this Agreement, the Company shall pay, or cause to be
paid to the Executive in cash in accordance with the normal payroll practices of
the Company for senior executive officers (including deductions withholdings and
collections as required by law), the following:

      3.01  Annual Base Salary. An annual base salary ("ANNUAL BASE SALARY")
will be paid equal to Four Hundred Sixty One Thousand Dollars ($461,000) per
year. Adjustments in Annual Base Salary, if any, shall be determined by the
Company in its sole and absolute discretion, based upon annual reviews prior to
March 31 of each year of the scope of the Executive's duties and Executive's
performance of such duties.

      3.02  Annual Bonus. A cash bonus (the "ANNUAL BONUS") to be paid each year
pursuant to the Company's Economic Profit Bonus Plan, subject to the achievement
of goals agreed by the Chief Executive Officer in accordance with this Section
3.02, at the same time bonuses are generally paid to other senior executives of
the Company for the relevant fiscal year. Each year of the term of this
Agreement the Chief Executive Officer shall approve objective and quantifiable
annual goals which shall be reduced to writing and presented to the Executive on
or before the sixtieth (60th) day after the Effective Date or the commencement
of the Company's fiscal year, as appropriate. The targeted annual bonus shall be
ninety percent (90%) of the Executive's Annual Base Salary on March 31, 2005
from April 1, 2004 forward.

      3.03  Gross Amounts. The Annual Base Salary and Annual Bonus set forth in
this Article III shall be the gross amounts of such Annual Base Salary and
Annual Bonus. The Executive is responsible for paying any and all taxes due on
any amounts received by him as

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Annual Base Salary or Annual Bonus, including, but not limited to, any income
tax, social security tax, Medicare tax or capital gains tax.

                                   ARTICLE IV
                                 OTHER BENEFITS

      4.01  Incentive Savings and Retirement Plans. The Executive shall be
entitled to participate, during the term of this Agreement, in all incentive
(including the Company's Equity Incentive Plan), savings and retirement plans,
practices, policies and programs available to other senior executives of the
Company. Any benefits received pursuant to this Section 4.01 shall be the gross
amount of such benefits. The Executive is responsible for paying any and all
taxes due on any benefits received pursuant to this Section 4.01, including, but
not limited to, any income tax, social security tax, Medicare tax or capital
gains tax.

      4.02  Welfare Benefits. Immediately upon the Effective Date and throughout
the term of this Agreement, the Executive and/or the Executive's family, as the
case may be, shall be entitled to participate in, and shall receive all benefits
under, all welfare benefit plans, practices, policies and programs provided by
the Company (including without limitation, medical, prescription, dental,
disability, salary continuance, employee life, group life, dependent life,
accidental death and travel accident insurance plans and programs) in accordance
with the applicable provisions thereof, at a level that is equal to other senior
executives of the Company. For the avoidance of doubt, the Executive's Accident,
Death and Dismemberment cover will be a minimum three times the Executive's
annual base salary, or such higher amount as is agreed by the Company.

      4.03  Fringe Benefits. Immediately upon the Effective Date and throughout
the term of this Agreement, the Executive shall be entitled to participate in
all appropriate fringe benefit programs provided by the Company to its senior
executives at comparable levels.

      4.04  Expenses. During the term of this Agreement, the Executive shall be
entitled to receive prompt reimbursement for all reasonable and necessary travel
and other business expenses incurred or paid by the Executive in connection with
the performance of his services under this Agreement. The Executive shall be
reimbursed upon the Company's receipt of accountings in accordance with
practices, policies and procedures applicable to senior executives of the
Company.

      4.05  Vacation. The Executive shall be entitled to twenty (20) paid
vacation days during each twelve (12) month period, beginning the Effective
Date, during the term of this Agreement. Such paid vacation days shall accrue
without cancellation, expiration or forfeiture.

      4.06  Car Allowance. The Company will either lease an automobile for
business and personal use by the Executive, or, in the alternative, the
Executive will be entitled to an automobile lease allowance not to exceed Seven
Hundred Fifty Dollars ($750) per month during the term of this Agreement. Unused
allowance or part thereof will be paid to the Executive. The Company shall be
responsible for all costs relating thereto, including gasoline, repairs,
maintenance and insurance. All automobile insurance policies for such automobile
shall name

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the Company and the Executive as co-insureds. Personal taxation costs arising
from the Executive's personal use of such automobile shall be the Executive's
sole responsibility.

      4.07  Annual Review. The Executive's benefits under this Article IV will
be reviewed annually during the review process provided in Section 3.01 above.

                                    ARTICLE V
                              RESTRICTIVE COVENANTS

      5.01  Trade Secrets. Confidential and Proprietary Business Information.

            (a)   The Company has advised the Executive and the Executive has
acknowledged that it is the policy of the Company to maintain as secret and
confidential all Protected Information (as defined below), and that Protected
Information has been and will be developed at substantial cost and effort to the
Group. "Protected Information" means trade secrets, confidential and proprietary
business information of the Group, any information of the Group other than
information which has entered the public domain (unless such information entered
the public domain through effects of or on account of the Executive), and all
valuable and unique information and techniques acquired, developed or used by
the Group relating to its business, operations, employees, customers and
suppliers, which give the Group a competitive advantage over those who do not
know the information and techniques and which are protected by the Group from
unauthorized disclosure, including but not limited to, customer lists (including
potential customers), sources of supply, processes, plans, materials, pricing
information, internal memoranda, marketing plans, internal policies, and
products and services which may be developed from time to time by the Group and
any of their agents or employees.

            (b)   The Executive acknowledges that the Executive will acquire
Protected Information with respect to the Group and its successors in interest,
which information is a valuable, special and unique asset of the Group's
business and operations and that disclosure of such Protected Information would
cause irreparable damage to the Group.

            (c)   Either during or after termination of employment by the
Company, the Executive shall not, directly or indirectly, divulge, furnish or
make accessible to any person, firm, corporation, association or other entity
(otherwise than as may be required in the regular course of the Executive's
employment) nor use in any manner, any Protected Information, or cause any such
information of the Group to enter the public domain.

      5.02  Non-Competition

            (a)   The Executive agrees that the Executive shall not during the
Executive's employment with the Company, and, in accordance with Sections
6.01(b), 6.02(b), and 6.03(c) for a period of at least two (2) years, and up to
four (4) years at the Company's discretion (assuming exercise of the Company's
rights under 7.01(b)), after the termination of this Agreement, directly or
indirectly, in any capacity, engage or participate in, or become employed

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by or render advisory or consulting or other services in connection with any
Prohibited Business as defined in Section 5.02(c).

            (b)   The Executive agrees that the Executive shall not during the
Executive's employment with the Company, and, in accordance with Sections
6.01(b), 6.02(b), and 6.03(c) for a period of at least two years, and up to four
(4) years at the Company's discretion (assuming exercise of the Company's rights
under 7.01(b)), after the termination of this Agreement, make any financial
investment, whether in the form of equity or debt, or own any interest, directly
or indirectly, in any Prohibited Business. Nothing in this Section 5.02(b)
shall, however, restrict the Executive from making any investment in any company
whose stock is listed on a national securities exchange; provided that (i) such
investment does not give the Executive the right or ability to control or
influence the policy decisions of any Prohibited Business, and (ii) such
investment does not create a conflict of interest between the Executive's duties
hereunder and the Executive's interest in such investment.

            (c)   For purposes of this Section 5.02, "Prohibited Business" shall
be defined as the business of:

                  (i)   marketing or selling of fiber cement products, where the
                        marketing or selling of such products is a principal
                        activity of the business;

                  (ii)  manufacturing or processing fiber cement products;

                  (iii) building, assembling, operating or maintaining plant and
                        equipment, where that plant and equipment is particular
                        to the manufacturing or processing of fiber cement
                        products;

                  (iv)  manufacturing or processing raw materials for fiber
                        cement products where that manufacturing or processing
                        is particular to the raw material used in fiber cement
                        products;

                  (v)   research or development activities relating to Section
                        5.02(c)(i)-(iv); and

and any branch, office or operation thereof, which is a competitor of the
Company or which has established or seeks to establish contact, in whatever form
(including, but not limited to solicitation of sales, or the receipt or
submission of bids), with any entity who is at any time a client, customer or
supplier of the Company (including but not limited to all subdivisions of the
federal government.)

      5.03  Non-Solicitation. From the date hereof until at least two (2) years
and up to four (4) years at the Company's discretion after the Executive's
termination of employment with the Company, the Executive shall not, directly or
indirectly (a) encourage any employee or supplier of the Group or any of their
successors in interest to leave his or her employment with the Group or any of
their successors in interest, (b) employ, hire, solicit or cause to be employed,
hired or solicited (other than by the Group or any of their successors in
interest), or encourage others to employ or hire any person who within at least
two (2) years, and up to four (4) years at the

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Company's discretion, prior thereto was employed by the Group or any of their
successors in interest, or (c) establish a business with, or encourage others to
establish a business with, any person who within at least two (2) years, and up
to four (4) years at the Company's discretion, prior thereto was an employee or
supplier of the Group or any of their successors in interest.

      5.04  Disclosure of Employee-Created Trade Secrets Confidential and
Proprietary Business Information. The Executive agrees to promptly disclose to
the Company all Protected Information developed in whole or in part by the
Executive during the Executive's employment with the Company and which relates
to the Group's business. Such Protected Information is, and shall remain, the
exclusive property of the Company. All writings created during the Executive's
employment with the Company (excluding writings unrelated to the Company's
business) are considered to be "works-for-hire" for the benefit of the Group and
the Company shall own all rights in such writings.

      5.05  Survival of Undertakings and Injunctive Relief

            (a)   The provisions of Sections 5.01, 5.02, 5.03 and 5.04 of this
Agreement shall survive both the termination of the Executive's employment with
the Company and the termination of this Agreement irrespective of the reasons
for such termination.

            (b)   The Executive acknowledges and agrees that the restrictions
imposed upon the Executive by Sections 5.01, 5.02, 5.03 and 5.04 of this
Agreement and the purpose of such restrictions are reasonable and are designed
to protect the Protected Information and the continued success of the Company
without unduly restricting the Executive's future employment by others.
Furthermore, the Executive acknowledges that, in view of the Protected
Information which the Executive has or will acquire or has or will have access
to and in view of the necessity of the restrictions contained in Sections 5.01,
5.02, 5.03 and 5.04, any violation of any provision of Sections 5.01, 5.02, 5.03
and 5.04 hereof would cause irreparable injury to the Company and its successors
in interest with respect to the resulting disruption in their operations. By
reason of the foregoing the Executive consents and agrees that if the Executive
violates any of the provisions of Sections 5.01, 5.02, 5.03 or 5.04 of this
Agreement, the Company and its successors in interest as the case may be, shall
be entitled, in addition to any other remedies that they may have, including
money damages, to an injunction to be issued by a court of competent
jurisdiction, restraining the Executive from committing or continuing any
violation of such Sections of this Agreement.

      In the event of any such violation of Sections 5.01, 5.02, 5.03 and 5.04
of this Agreement, the Executive further agrees that the time periods set forth
in such Sections shall be extended by the period of such violation.

                                   ARTICLE VI
                                   TERMINATION

      6.01  Termination of Employment by Voluntary Resignation /Death
/Disability.

            (a)   The Executive's employment under this Agreement may be
terminated:

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                  (i)   Upon voluntary resignation by the Executive in
accordance with the notification requirement provided in Article IX;

                  (ii)  Upon the death of the Executive, this Agreement and the
Executive's employment hereunder shall terminate immediately and without notice
by the Company; or

                  (iii) In the event of the inability of the Executive to
perform his duties or responsibilities thereunder, as a result of a Permanent
Disability (as defined below) upon written notice by the Company. A "Permanent
Disability" occurs when for a period of ninety (90) consecutive calendar days,
or an aggregate of one hundred twenty (120) calendar days during any calendar
year (whether or not consecutive) the Executive is unable to perform his duties
or responsibilities hereunder as a result of a mental or physical ailment or
incapacity. Upon the occurrence of a Permanent Disability, the Company will
evaluate the Executive's condition and determine whether or not to send written
notice of such Executive's termination.

            (b)   Upon termination pursuant to this Section 6.01(a)(i), the
Executive shall not be entitled to payment of any compensation other than salary
under this Agreement earned up to the date of such termination, any accrued but
unpaid vacation days, and any stock options, warrants or similar rights which
have vested at the date of such termination. The Company and the Executive agree
that the Company shall continue to pay the Executive his Annual Base Salary, in
accordance with the Company's normal practices for other senior executives, for
two (2) years after the Executive's voluntary resignation, and the Executive
agrees not to violate the provisions of Section 5.02 for an equivalent period.

            (c)   Upon termination pursuant to this Section 6.01(a)(ii) above,
the Company shall pay or grant, to such person as the Executive designates in a
notice filed with the Company, or, if no such person shall be designated, to the
Executive's estate as a lump sum death benefit, an amount equal to any
compensation under this Agreement earned up to the date of such termination,
including salary and any accrued but unpaid vacation days. In addition, any
stock options or warrants which have vested at the time such termination will be
exercisable by the Executive's estate in accordance with the Company's Equity
Incentive Plan. The Executive's designated beneficiary or the executor of the
Executive's estate, as the case may be, shall accept the payment provided for in
this Paragraph 6.01(c) in full discharge and release of the Company of and from
any further obligations under this Agreement.

            (d)   Upon termination pursuant to Section 6.01(a)(iii) above, the
Executive shall be entitled to the benefit of disability or other relevant
insurance or benefits provided pursuant to Section 4.02 above. The Executive
shall not be entitled to payment of any compensation other than salary under
this Agreement earned up to the date of such termination, any accrued but unpaid
vacation days, and any stock options, warrants or similar rights which have
vested at the date of such termination. The Company, in its sole and absolute
discretion, may decide to continue to pay the Executive his Annual Base Salary,
in accordance with the Company's normal practices for other senior executives,
for two (2) years after the Executive's voluntary resignation, in return for the
Executive not violating the provisions of Section 5.02 for

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an equivalent period and the Executive's execution, without revocation, of a
Company Release of Claims upon the effective date of the termination of the
Executive's employment.

      6.02  Termination for Cause. (a) The Company may terminate the Executive's
employment for Cause by giving the Executive written notice of such termination.
For purposes of this Agreement, "Cause" for termination shall mean:

                  (i)   the willful failure or refusal to carry out the
reasonable directions of the Chief Executive Officer or Board of Directors,
which directions are consistent with the Executive's duties as set forth under
this Agreement;

                  (ii)  a willful act by the Executive that constitutes gross
negligence in the performance of the Executive's duties under this Agreement and
which materially injures the Company. No act, or failure to act, by the
Executive shall be considered "willful" unless committed without good faith and
without a reasonable belief that the act or omission was in the Company's best
interest; or

                  (iii) a conviction for a violation of a state or federal
criminal law involving the commission of a felony or other crime involving moral
turpitude.

            (b)   Upon termination for Cause, the Executive shall not be
entitled to payment of any compensation other than salary under this Agreement
earned up to the date of such termination, any accrued but unpaid vacation days,
and any stock options, warrants or similar rights which have vested at the date
of such termination. The Company and the Executive agree that the Company shall
continue to pay the Executive his Annual Base Salary, in accordance with the
Company's normal practices for other senior executives, for two (2) years after
such termination for Cause, and the Executive agrees not to violate the
provisions of Section 5.02 for an equivalent period and the Executive's
execution, without revocation, of a Company Release of Claims upon the effective
date of the termination of the Executive's employment.

      6.03  Termination Without Cause or Termination by Executive for Good
Reason. Should the Executive's employment be terminated for a reason other than
as specifically set forth in Sections 6.01 or 6.02 above, whether terminated by
the Company or terminated by the Executive for Good Reason (as defined below):

            (a)   the Company shall pay the Executive an amount equal to 1.5
times the Annual Base Salary applying as at the date of termination, paid in
accordance with Section 6.03(c) below.

            (b)   the Company shall pay the Executive an amount equal to 1.5
times the Average Annual Bonus actually paid to the Executive in accordance with
Section 6.03(c) below. For purposes of this Section 6.03, Average Annual Bonus
shall mean the aggregate Annual Bonus actually paid to the Executive by the
Company, including the bonus bank amounts actually paid out to the Executive,
over the last three years immediately preceding the year of such termination
divided by three.

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            (c)   the Company shall pay the amounts specified in each of
Sections 6.03(a) and (b) above in monthly installments, in accordance with the
Company's normal payroll practices for other senior executives, for the period
of eighteen months following such termination, in return for the Executive's
execution, without revocation, of a Company Release of Claims upon the effective
date of the termination of the Executive's employment. In addition, the Company
and the Executive agree that the Company shall continue to pay the Executive
additional amounts equal to his Annual Base Salary as of the date of termination
of employment in accordance with the Company's normal practices for other senior
executives, for up to two (2) years following the Executive's termination, and
the Executive agrees not to violate the provisions of Section 5.02 above for an
equivalent period and the Executive's execution, without revocation, of a
Company Release of Claims at that time.

            (d)   all of the stock options, warrants, retirement benefits and
other similar rights, if any, granted by the Company to the Executive which are
vested at the date of the termination of the Executive's employment shall remain
vested. All stock options that will vest between the date of such termination of
employment and the completion of the Consulting Agreement addressed in Article
VII of the Agreement (or violation of Section 5.02 above if that occurs), will
continue to vest on the vest dates stipulated in the grant document. All stock
options unvested as of the completion of the Consulting Agreement addressed in
Article VII of the Agreement (or violation of Section 5.02 above if that occurs)
will immediately expire. All stock options vested as of the completion of the
Consulting Agreement addressed in Article VII of the Agreement (or violation of
Section 5.02 above if that occurs) will remain exercisable until the earlier of
(i) the date such Stock Options would expire in accordance with their terms, and
(ii) 90 days after the date of completion of the Consulting Agreement and/or
violation of Section 5.02 above.

            (e)   all health and medical benefits shall continue for the
remainder of the term of this Agreement; and the Company will pay the
Executive's premium for continued coverage for medical, dental and vision
benefits, if applicable, under the Consolidated Omnibus Budget Reconciliation
Act of 1986, as amended ("COBRA") for himself and, if applicable, his covered
dependents for up to eighteen months following the date of the termination of
Executive's employment, in accordance with the provisions of COBRA, for a period
of up to eighteen months following the termination of the Executive's
employment.

            The term "Good Reason," in connection with the termination by the
Executive of his employment with the Company shall mean:

            (i)   A diminution in the responsibilities, title or office of the
Executive such that he does not serve as an executive officer of the Company
(which diminution was not for Cause or the result of the Executive's
disability); or

            (ii)  A reduction by the Company in the Executive's Annual Base
Salary to less than (a) $461,000, or (b) the Executive's Annual Base Salary at
the time of such reduction.

      6.04  No Mitigation. The Executive shall not be required to mitigate the
amount of any payment provided for in Section 6.03 above by seeking other
employment or otherwise, nor shall

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the amount of any payment provided for in Section 6.03 be reduced by any
compensation earned by the Executive as a result of employment by another
company, self-employment or otherwise.

                                   ARTICLE VII
                       POST-TERMINATION CONSULTING PERIOD

      7.01  In addition to the matters set forth in Article VI above, upon the
            termination of the Executive's employment, the Company and the
            Executive agree to:

      (a)   Consult to the Company for two years for up to 100 hours/year and
            agrees not to violate Section 5.02 above, in exchange for the
            payment of the Executive's annual target bonus amount (paid in
            monthly installments), in accordance with the terms of the standard
            James Hardie Consulting Agreement, a copy of which is attached
            ("Consulting Agreement").

      (b)   Additionally, the Company may elect to extend this Consulting
            Agreement for an additional two years, and the Executive will agree
            to such extension, in exchange for the amount equal to the annual
            base salary and target bonus for each year of extension.

                                  ARTICLE VIII
                                     RELEASE

      8.1   As a material inducement for the Company to provide compensation and
certain benefits described in the Agreement, Executive, on his own behalf and on
behalf of his spouse, heirs, executors, administrators, successors, and assigns,
hereby irrevocably and unconditionally releases, acquits and forever discharges
the Group and each of their predecessors, successors, assigns, agents,
directors, officers, employees, partners, attorneys, representatives, retirement
benefit plans, welfare benefit plans, divisions, subsidiaries, parent companies,
affiliates (and agents, directors, officers, employees, partners, attorneys,
representatives, retirement benefit plans, and welfare benefit plans of such
divisions, subsidiaries, parent companies and affiliates), and all persons
acting by, through, under or in concert with any of them (collectively,
"Releasees"), or any of them from any and all charges, complaints, claims,
liabilities, obligations, promises, agreements, controversies, damages, actions,
causes of action, suits, rights, demands, costs, losses, debts and expenses
(including attorneys' fees and costs actually incurred) (collectively, "Claims")
of any nature whatsoever known or unknown, suspected or unsuspected, including
but not limited to Claims arising under any compensation plan, welfare benefit
plan, contract, agreement or understanding, whether express or implied, any tort
or other cause of action, including but not limited to those arising under
federal, state or local laws prohibiting age, sex, disability or other forms of
discrimination, including but not limited to Title VII of the Civil Rights Act
of 1964, as amended, the Employee Retirement Income Security Act of 1974, as
amended, the Age Discrimination in Employment Act of 1967, as amended, the
Americans With Disabilities Act of 1990, the Family and Medical Leave Act of
1993, the Fair Labor Standards Act of 1938, as amended, the Consolidated Omnibus
Budget Reconciliation Act of 1986, as amended, the Fair Employment and Housing
Act, any regulations thereunder, state or federal common law, or any other duty
or obligation of any kind or description whether express or

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implied, which Claims relate to arise out of the Executive's change in role as
set out in this Agreement, and which Executive now has, owns or holds or claims
to have, own or hold or which Executive at any time heretofore has owned or held
or claimed to have, own or hold or claim to have, own or hold against each or
any of the Releasees, except claims arising under any applicable bonus plan,
pension benefit plan, medical benefit plan, dental benefit plan, or vision
benefit plan in which the Executive is participating as of the date of this
Agreement. The foregoing provision in this Paragraph 8.1 shall not apply to
activities that are permitted under applicable law, except that Executive
acknowledges that he has irrevocably waived any right to recovery against the
Releasees in connection with such activities, or otherwise. This Release is not
intended to restrict either Executive's or the Company's rights and obligations
to abide by and/or enforce the terms and conditions of this Agreement. For the
avoidance of doubt, the release set out in this Article VIII applies solely to
Claims which relate to arise out of the Executive's change in role as set out in
this Agreement.

      8.2   As a condition of this Release, Executive waives all rights arising
under Section 1542 of the Civil Code of the State of California against
Releasees. Section 1542 provides as follows:

                  A General Release does not extend to claims which a creditor
                  does not know or suspect to exist in his favor as of the time
                  of executing the Release which if known by him must have
                  materially affected his settlement with the debtor.

Notwithstanding the provisions of Section 1542 and for the purpose of
implementing the full and complete release and discharge of the liability of all
Releasees described in Paragraph 8.1 above as of the effective date of the
Agreement, Executive expressly acknowledges that the Release is intended to
include and does include in its effect without limitation all Claims which
Executive does not know or expect to exist in his favor against Releasees as of
the time of the effective date of this Release and that this Release expressly
contemplates the extinguishment of any such Claims, including attorneys' fees
and costs.

      8.3   Executive acknowledges that he has been encouraged to consult with
an attorney before signing this Agreement, and that he may return the signed
Agreement to the Company during the period beginning with his receipt of the
Agreement and ending, without Executive's revocation, twenty-one (21) days from
the date Executive receives it. If Executive does sign this Agreement, Executive
acknowledges that he will have seven (7) days after he executes it to
voluntarily decide to revoke it, and it will not become effective until seven
(7) days has expired, without Executive's revocation, from the date Executive
voluntarily chose to execute it. Executive further acknowledges that he has read
this Article VIII carefully and that he knowingly and voluntarily agrees to
accept the terms and conditions set forth in the Agreement, as consideration for
the Release described herein. Executive further acknowledges that he was
provided twenty-one (21) days within which to consider the terms of the Release,
including seeking counsel, and that the consideration described within the
Agreement is sufficient and adequate consideration for the Release as it
reflects compensation and benefits above and beyond those to which Executive is
entitled as of the date of this Release.

                                       11
<PAGE>
                                   ARTICLE IX
                                  MISCELLANEOUS

      9.01  Assignment, Successors. This Agreement, or any right or interest
herein, may not be assigned by either party hereto, whether by operation of law
or otherwise, without the prior written consent of the other party. This
Agreement shall be binding upon and inure to the benefit of the Executive and
the Executive's estate and the Company and any assignee of or successor to the
Company.

      9.02  Severability. If all or any part of this Agreement is declared by
any court or governmental authority to be unlawful or invalid, such unlawfulness
or invalidity shall not serve to invalidate any portion of this Agreement not
declared to be unlawful or invalid. Any paragraph or part of a paragraph so
declared to be unlawful or invalid shall, if possible, be construed in a manner
which will give effect to the terms of such paragraph or part of a paragraph to
the fullest extent possible while remaining lawful and valid.

      9.03  Amendment and Waiver. This Agreement shall not be altered, amended
or modified except by written instrument executed by the Company and the
Executive. A waiver of any term, covenant, agreement or condition contained in
this Agreement shall not be deemed a waiver of any other term, covenant,
agreement or condition and any waiver of any other term, covenant, agreement or
condition, and any waiver of any default in any such term, covenant, agreement
or condition shall not be deemed a waiver of any later default thereof or of any
other term, covenant, agreement or condition.

      9.04  Notices. All notices, requests, demands and other communications
hereunder shall be in writing and shall be deemed given upon personal delivery,
facsimile transmission (with confirmation of receipt), delivery by a reputable
overnight courier service or five (5) days following deposit in the U.S. mail
(if sent by registered or certified mail, return receipt requested, postage
prepaid), in each case duly addressed to the party to whom such notice or
communication is to be given as follows:

            If to the Company:        JAMES HARDIE BUILDING PRODUCTS INC.
                                      Attn:  CEO
                                      26300 La Alameda, Suite 100
                                      Mission Viejo, California 92691
                                      Fax: (949) 367-1294

            With a copy to:           VP HR
                                      26300 La Alameda, Suite 100
                                      Mission Viejo, California 92691
                                      Fax: (949) 367-1294

            If to the Executive:      LOUIS GRIES
                                      c/o James Hardie Building Products Inc.
                                      26300 La Alameda, Suite 250
                                      Mission Viejo, California  92614
                                      Fax: (949) 367-1294

                                       12
<PAGE>
Either party may from time to time designate a new address by notice given in
accordance with this Section. Notice and communications shall be effective when
actually received by the addressee.

      9.05  Counterpart Originals. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

      9.06  Entire Agreement. This Agreement forms the entire agreement between
the parties hereto with respect to any severance payment and with respect to the
subject matter contained in the Agreement.

      9.07  Applicable Law. The provisions of this Agreement shall be
interpreted and construed in accordance with the laws of the state of
California, without regard to its choice of law principles.

      9.08  Effect on Other Agreements. This Agreement shall terminate and
supersede all prior agreements, promises and representations regarding the terms
and conditions of the Executive's employment by the Company, James Hardie
Industries N.V., or any of their subsidiaries or affiliates, and any severance
or other payments contingent upon termination of employment, including but not
limited to a certain Employment Agreement by and between the Company and the
Executive, made and entered into as of the 25th day of February, 2003.

      9.09  Extension or Renegotiation. The parties hereto agree that at any
time prior to the expiration of this Agreement, they may extend or renegotiate
this Agreement upon mutually agreeable terms and conditions.

      9.10  Legal Fees; Arbitration. The parties hereto expressly agree that in
the event of any dispute, controversy or claim by any party regarding this
Agreement, the prevailing party shall be entitled to reimbursement by the other
party to the proceeding of reasonable attorney's fees, expenses and costs
incurred by the prevailing party. Any controversy, dispute or claim arising out
of, in connection with, or in relation to the interpretation, performance or
breach of this Agreement or otherwise arising out of the execution hereof,
including any claim based on contract, tort or statute, shall be resolved, at
the request of any party, by submission to binding arbitration at the Orange
County, California offices of Judicial Arbitration & Mediation Services, Inc.
("JAMS"), and any judgment or award rendered by JAMS shall be final, binding and
unappealable, and judgment may be entered by any state or federal court having
jurisdiction thereof. Any party can initiate arbitration by sending written
notice of intention to arbitrate (the "DEMAND") by registered or certified mail
to all parties and to JAMS. The Demand shall contain a description of the
dispute, the amount involved, and the remedy sought. The arbitrator shall be a
retired or former judge agreed to between the parties from the JAMS' panel. If
the parties are unable to agree, JAMS shall provide a list of three available
judges and each party may strike one. The remaining judge shall serve as the
arbitrator. Each party hereto intends that the provisions to arbitrate set forth
herein be valid, enforceable and irrevocable. In her award, the

                                       13
<PAGE>
arbitrator shall allocate, in her discretion, among the parties to the
arbitration all costs of the arbitration, including the fees of the arbitrator
and reasonable attorneys' fees, costs and expert witness expenses of the
parties. The parties hereto agree to comply with any award made in any such
arbitration proceedings that has become final and agree to the entry of a
judgment in any jurisdiction upon any award rendered in such proceeding becoming
final.

      IN WITNESS WHEREOF the parties have executed this Employment Agreement on
the date first written above.

                                       JAMES HARDIE BUILDING PRODUCTS INC.,
                                       a California corporation

                                       By: /s/ John Barr
                                           -------------
                                       Name:  John Barr
                                       Title: Deputy Chairman of the Board

                                       LOUIS GRIES, an individual

                                       /s/ Louis Gries
                                       ---------------
                                       Louis Gries

                                       14<PAGE>
                                                                    EXHIBIT 4.12

October 8, 2004

Re: Amended Secondment

Mr. James Chilcoff
Rosehill, Australia

Dear Jamie:

Congratulations on your promotion to Executive Vice President - International.
With this promotion, we offer you an Amended Secondment ("Agreement").

In light of the fact that you are now a member of the Group Management Team
("GMT"), James Hardie would like to amend your Secondment Agreement dated June
2, 2003 ("Secondment"), in consideration of the covenants contained herein, by
providing you the terms set forth below.

For the purposes of this Agreement, the word "Company" collectively means James
Hardie Building Products, Inc. ("JHBP") and James Hardie Building Products Pty
Ltd, known as James Hardie Australia ("JHA"). In other words, JHBP and JHA are
collectively referred to herein as "Company".

It is understood by you and the Company that this Agreement shall terminate and
supersede all prior employment agreements, service agreements, or other
agreements, promises and representations regarding the terms and conditions of
your employment between you and the Company or any of its subsidiaries or
affiliates, including but not limited to the Secondment, which is no longer of
any force or effect.

It is further understood by you and the Company that the terms and conditions of
your employment are otherwise governed by the policies and procedures of JHBP
applicable to similarly-situated executives of JHBP when you are working in the
United States, and by the policies and procedures of JHA applicable to
similarly-situated executives of JHA when you are working on assignment for JHA
in Australia.

It is a condition of the Agreement that you are granted a work permit for the
duration or your work assignment in Australia.

                            WORK FOR JHA IN AUSTRALIA

LOCATION OF SERVICE

1.01  The position is presently located at our Rosehill Office. The location of
      your employment may be changed from time to time in accordance with the
      Company's business needs. In the event of this occurring any such change
      and the Company's relocation policy would first be discussed with you.

REPORTING RELATIONSHIP

2.01  You will report to Louis Gries, EVP Operations.

REMUNERATION

3.01       Your remuneration will be based on an annual salary of US$250,000.

<PAGE>

                                                                               2

3.02  On the basis that you will be living away from your usual place of
      residence, you will receive an additional taxable expatriate allowance of
      US$20,000 per year.

3.03  Your total remuneration will be paid to you through your current USA
      payroll.

3.04  By remaining on the USA payroll, you will continue to be eligible to
      participate in the USA 401(k) plan, according to Company and plan
      policies. The Company currently matches your contribution $1 for $1 up to
      six percent of your salary up to the IRS maximum.

3.05  Salaries are reviewed on the basis of measured performance in July of each
      year, starting July 2005.

3.06  Your remuneration relies on the fact that you are living away from home
      and therefore you will be required to sign a declaration to that effect
      annually (see attached), which the Company will retain with its records.

PERFORMANCE BONUS

4.01  Your target bonus for FY 05 will be 45% of your March 31, 2005 base salary
      for April 1, 2004 to August 15, 2004 and 55% of your March 31, 2005 base
      salary starting August 15, 2004. Your actual bonus will be calculated
      based on JH's EP bonus plan parameters and your achievements against
      agreed objectives and targets (IP). Your bonus will be split between EP
      results (80%) and Individual Performance (20%).

4.02  The terms and conditions surrounding the plan are subject to alteration at
      the discretion of the Company and participation is reviewed annually.

SHARE PLAN

5.01  You will be eligible to participate in the JHI NV Equity Incentive Plan
      and continue to be treated as a U.S. employee for this consideration. The
      decision on equity eligibility and amounts is made each year. For purposes
      of that decision, you will be treated as a US employee.

TAXATION ADVICE

6.01  The Company will provide a tax adviser through PWC to assist in the
      processing of tax returns and advice on tax matters associated with your
      employment in Australia.

LEAVE

7.01  Annual Leave You will continue to accrue annual leave under the U.S.
      vacation policy. Based on your tenure, you will accrue 3 weeks (120 hours)
      per annum. You may continue to accrue up to a maximum of 240 hours based
      on Company policies.

7.02  Home Leave JHBP will pay coach class return airfares to the USA for you
      and your family, twice per annum. These tickets may be exchanged for
      travel tickets elsewhere in the world but not for cash. They may also be
      used to fly family members to Australia to visit.

CAR

8.01  The Company will provide both you and your spouse with cars; the company
      will provide a car for your use consistent with the level of your current
      Company-provided vehicle, and provide a car equivalent to a Honda Accord
      or similar class car for your spouse's use. Auto insurance,

<PAGE>

                                                                               3

      routine maintenance and warranties associated with the costs for
      maintenance of the cars will be paid by the Company. Business gasoline
      costs will be reimbursed per local policy; expenses for personal mileage
      will not be reimbursed.

POLICIES

9.01  Other policies applicable to you during your secondment will be as per the
      JHA policies.

                      CONDITIONS OF RELOCATION TO AUSTRALIA

IMMIGRATION

10.01 Your employment in Australia will be dependant on successfully maintaining
      the immigration status necessary for you to work in Australia.

10.02 If, at any stage, you intend to change your residency status from
      temporary to permanent, you are to advise the Company.

PERSONAL ACCIDENT INSURANCE

11.01 JHBP provides 24-hour business travel accident insurance for all
      expatriates, in accordance with the provisions of the applicable JHBP
      insurance plan or insurance agreement.

MEDICAL / HOSPITAL INSURANCE

12.01 As an expatriate employee, you have the same Life, Medical, Dental, Vision
      and Disability benefits as U.S. employees of JHBP. Since the PPO
      (Preferred Provider) Medical Plan has no specific contracted providers in
      your region, your medical benefits will be paid at the PPO level of
      benefits for services rendered outside of the U.S.

WHEN APPROPRIATE, REMOVAL AND STORAGE CHARGES

13.01 The cost of packing, freight and insurance in transit of your personal
      effects (excluding items of unique high value (e.g. pianos) or animals)
      will be met by JHA.

13.02 Items of value that are not shipped may be placed in commercial storage at
      the employee's home base. A reasonable cost of storage, removal into
      storage and insurance on storage items will be met by JHA.

ACCOMMODATION

14.01 LONG-TERM ACCOMMODATION
      To satisfy your long-term accommodation needs, JHA will continue to
      reimburse you AUD $3,500 per month to cover the cost of a fully furnished
      apartment or house, while you are working for JHA in Australia. It is also
      agreed that JHA will pay this amount regardless of whether less or more
      than this amount is actually incurred. Where the actual housing cost is
      less than A$3,500, the payment will be broken into two components:

      -     the payment/reimbursement of the actual rent; and

      -     the balance paid as a taxable cash allowance, in which the company
            will pay for the taxes.

EDUCATION FOR CHILDREN

15.01 JHA will continue to provide the costs associated with reasonable tuition
      and appropriate fees, which may apply for your school-aged children while
      you are working for JHA in Australia.

<PAGE>

                                                                               4

LIABILITY FOR TAX PAYMENTS

16.01 You will continue to be tax equalized to the State of California for the
      period of your work assignment for JHA in Australia. Tax equalization is
      intended to equate the tax liability you incur during your overseas
      assignment with that of a domestic employee under similar economic
      circumstances. You will be reimbursed for any excess of U.S. or foreign
      taxes you are required to pay beyond the U.S. and California taxes you
      would have incurred on your base salary, bonus, if any, and imputed income
      from group life insurance, if you had not taken the overseas assignment.

16.02 While you are on assignment for JHA in Australia, you will pay a
      hypothetical tax in lieu of actual tax liabilities. The hypothetical tax
      is representative of your tax responsibilities while on assignment. We
      will have PricewaterhouseCoopers calculate the amount to be withheld.

                               GENERAL CONDITIONS

PERIOD OF NOTICE

17.01 Either party may terminate this Agreement by giving the other party thirty
      (30) days notice in writing. The Company may elect to make a payment in
      lieu of the whole or part of any period of notice given to the Company by
      you, or by the Company to you. Of course, the Company may terminate this
      Agreement immediately if it reasonably believes that you have engaged in
      conduct which violates Company policy, or otherwise constitutes dishonest
      activity, whether criminal or otherwise, including but not limited to
      fraud, misrepresentation, theft of Company property, embezzlement, larceny
      and misappropriation under applicable state and/or federal law.

TERMINATION OF JHA WORK ASSIGNMENT

18.01 In the event of termination of the JHA work assignment by JHA or you, JHA
      will pay reasonable repatriation costs for you, your family and your
      belongings to California, unless you were in breach of conditions applying
      to your employment. Repatriation would have to occur within six months of
      termination for this clause to apply.

18.02 Termination of employment by Redundancy, Resignation or other reason, will
      mean conclusion of the transfer and you will be assisted with relocation
      as described above, to California.

18.03 At the end of your JHA work assignment, JHBP will attempt to return you to
      a position in California in the US business and repatriate you to that
      location, unless you are released based on the Company's reasonable belief
      that you engaged in conduct which violates Company policy or otherwise
      constitutes dishonest activity, whether criminal or otherwise, including
      but not limited to fraud, misrepresentation, theft of Company property,
      embezzlement, larceny and misappropriation under applicable state and/or
      federal law. Refer to Repatriation Conditions section below.

CONFLICT OF INTEREST

19.01 You agree to declare any potential conflict of interest, which might
      affect the decisions of the Company in dealing with any third party, where
      either you or an associate or family member has an interest in that third
      party by way of employment or financial interest or any potential personal
      gain.

<PAGE>

                                                                               5

CONFIDENTIALITY

20.01 In accepting this appointment, you agree that during or after your
      employment with the Company you will not disclose to anyone outside the
      Company, or use in any way other than in the Company's business, any
      information that may reasonably be said or understood to be confidential
      in relation to the Company's activities.

20.02 Further, you agree that on termination of employment you will give up and
      not take with you any material containing information, which may
      reasonably be understood to be confidential in relation to the Company's
      activities.

                             REPATRIATION CONDITIONS

REPATRIATION TO USA

21.01 Upon successful completion of your work assignment for JHA in Australia,
      JHA will pay reasonable repatriation costs for you and your family to
      return to California or location of JHBP assignment, including the return
      coach class airfare. JHA will also pay reasonable costs associated with
      the shipment of your belongings. In addition, JH will pay reasonable
      housing costs for a period of up to one (1) month upon return to
      California or location of JHBP assignment. You will also be provided with
      tax assistance in relation to your return to the USA.

21.02 JH will reimburse the costs associated with purchasing a house in the USA.
      The details of this will be addressed in a contract that moves you back to
      the U.S.

                            CONDITIONS OF EMPLOYMENT

POST-TERMINATION CONSULTING PERIOD

22.01 Upon the termination of your employment with JHBP, you agree to:

      (a)   Consult to JHBP for two years for up to 100 hours/year. You agree to
            do this, as well as to not violate any of the TRADE SECRET/
            RESTRCTIVE COVENANTS set forth in this Agreement or in its policies
            and procedures, in order to protect our Company's proprietary,
            confidential business and manufacturing information. In exchange for
            the payment of an amount equal to your annual base salary at the
            time of termination (paid in monthly installments), in accordance
            with the terms of a James Hardie Consulting Agreement, a format of
            which is attached as a copy, for your general consideration. The
            exact terms and conditions will be agreed upon when, and if, this
            Agreement is prepared for execution. The Company will prepare this
            Consulting Agreement, in final.

      (b)   Additionally, the Company may elect to extend the Consulting
            Agreement for an additional two years, and you will agree to such
            extension, in exchange for the amount equal to the annual base
            salary for each year of extension.

RESTRICTIVE COVENANTS

23.01 Trade Secrets. Confidential and Proprietary Business Information.

      (a)   The Company has advised you and you have acknowledged that it is the
            policy of the Company to maintain as secret and confidential all
            Protected Information (as defined below), and that Protected
            Information has been and will be developed at substantial cost and
            effort to the Company and other companies in the James Hardie group
            - these companies together with the Company are referred to in this
            Agreement as the "Group." "Protected Information" means trade
            secrets, confidential and proprietary

<PAGE>

                                                                               6

            business information of the Group, any information of the Group
            other than information which has entered the public domain (unless
            such information entered the public domain through effects of or on
            account of you), and all valuable and unique information and
            techniques acquired, developed or used by the Group relating to its
            business, operations, employees, customers and suppliers, which give
            the Group a competitive advantage over those who do not know the
            information and techniques and which are protected by the Group from
            unauthorized disclosure, including but not limited to, customer
            lists (including potential customers), sources of supply, processes,
            plans, materials, pricing information, internal memoranda, marketing
            plans, internal policies, and products and services which may be
            developed from time to time by the Group and any of their agents or
            employees.

      (b)   You acknowledge that you have acquired and will acquire Protected
            Information with respect to the Group and its successors in
            interest, which information is a valuable, special and unique asset
            of the Group's business and operations and that disclosure of such
            Protected Information would cause irreparable damage to the Group.

      (c)   Either during or after termination of employment by the Company, you
            shall not, directly or indirectly, divulge, furnish or make
            accessible to any person, firm, corporation, association or other
            entity (otherwise than as may be required in the regular course of
            your employment) nor use in any manner, any Protected Information,
            or cause any such information of the Group to enter the public
            domain.

23.02      Non-Competition

      (a)   You agree that you shall not during your employment with the
            Company, and, subject for a period of at least two (2) years, and up
            to four (4) years, at the Company's discretion (assuming it
            exercises its rights to have you engaged as a Consultant, as set
            forth above), after the termination of the Agreement, directly or
            indirectly, in any capacity, engage or participate in, or become
            employed by or render advisory or consulting or other services in
            connection with any Prohibited Business as defined in subsection
            (c).

      (b)   You agree that you shall not, during your employment with the
            Company, and, for a period of at least two (2) years, and up to four
            (4) years at the Company's discretion (assuming it exercises its
            rights to have you engaged as a Consultant, as set forth above),
            after the termination of this Agreement, make any financial
            investment, whether in the form of equity or debt, or own any
            interest, directly or indirectly, in any Prohibited Business.
            Nothing shall, however, restrict you from making any investment in
            any company whose stock is listed on a national securities exchange;
            provided that (i) such investment does not give you the right or
            ability to control or influence the policy decisions of any
            Prohibited Business, and (ii) such investment does not create a
            conflict of interest between your duties hereunder and your interest
            in such investment.

      (c)   "Prohibited Business" shall be defined as the business of:

            (i)   marketing or selling of fiber cement products, where the
                  marketing or selling of such products is a principal activity
                  of the business;

            (ii)  manufacturing or processing fiber cement products;

            (iii) building, assembling, operating or maintaining plant and
                  equipment, where that plant and equipment is particular to the
                  manufacturing or processing of fiber cement products;

<PAGE>

                                                                               7

            (iv)  manufacturing or processing raw materials for fiber cement
                  products where that manufacturing or processing is particular
                  to the raw material used in fiber cement products;

            (v)   research or development activities relating to
                  subsections(c)(i)-(iv); and

      any branch, office or operation thereof, which is a competitor of the
      Group or which has established or seeks to establish contact, in whatever
      form (including, but not limited to solicitation of sales, or the receipt
      or submission of bids), with any entity who is at any time a client,
      customer or supplier of the Group (including but not limited to all
      subdivisions of the federal government).

23.03 Non-Solicitation. From the date hereof until at least two (2) years, and
      up to four (4) years at the Company's discretion, after your termination
      of employment with the Company, you shall not, directly or indirectly (a)
      encourage any employee or supplier of the Group or any of their successors
      in interest to leave his or her employment with the Group or any of their
      successors in interest, (b) employ, hire, solicit or cause to be employed,
      hired or solicited (other than by the Group or any of their successors in
      interest), or encourage others to employ or hire any person who within at
      least two (2) years, and up to four (4) years at the Company's discretion,
      prior thereto was employed by the Group or any of their successors in
      interest, or (c) establish a business with, or encourage others to
      establish a business with, any person who within at least two (2) years,
      and up to four (4) years at the Company's discretion, prior thereto was an
      employee or supplier of the Group or any of their successors in interest.

23.04 Disclosure of Employee-Created Trade Secrets Confidential and Proprietary
      Business Information. You agree to promptly disclose to the Company all
      Protected Information developed in whole or in part by you during your
      employment with the Company and which relates to the Group's business.
      Such Protected Information is, and shall remain, the exclusive property of
      the Company. All writings created during your employment with the Company
      (excluding writings unrelated to the Company's business) are considered to
      be "works-for-hire" for the benefit of the Group and the Company shall own
      all rights in such writings.

23.05 Survival of Undertakings and Injunctive Relief

      (a)   The provisions of these RESTRICTIVE COVENANTS of this Agreement
            shall survive both the termination of your employment with the
            Company and the termination of the Agreement, irrespective of the
            reasons for such termination.

      (b)   You acknowledge and agree that these RESTRICTIVE COVENANTS imposed
            upon you by this Agreement and the purpose of such restrictions are
            reasonable and are designed to protect the Protected Information and
            the continued success of the Company without unduly restricting your
            future employment by others. Furthermore, you acknowledge that, in
            view of the Protected Information which you have or will acquire or
            have or will have access to and in view of the necessity of these
            restrictions, any violation of them would cause irreparable injury
            to the Company and its successors in interest, with respect to the
            resulting disruption in their operations. By reason of the foregoing
            you consent and agree that if you violate any of these restrictions,
            or RESTRICTIVE COVENANTS, the Company and its successors in interest
            as the case may be, shall be entitled, in addition to any other
            remedies that they may have, including money damages, to an
            injunction to be issued by a court of competent jurisdiction,
            restraining you from committing or continuing any violation of such
            Sections of this Amendment.

            In the event of any such violations of these RESTRICTIVE COVENANTS,
            you further agree that the time periods set forth in such Sections
            shall be extended by the period

<PAGE>

                                                                               8

            of such violation, and you consent to the jurisdiction of the
            Superior Court for the County of Orange, State of California, as the
            competent court to hear and to determine any action in equity or law
            filed by the Company against you with respect to its necessity to
            protect itself under these RESTRCITIVE COVENANTS.

TERMINATION

24.01 Termination of Employment by Voluntary Resignation /Death /Disability.

      (a)   Your employment under the Agreement may be terminated:

            (i)   Upon your voluntary resignation in accordance with the
                  notification requirement provided in the Agreement;

            (ii)  Upon your death, the Agreement, and your employment hereunder
                  shall terminate immediately and without notice by the Company;
                  or

            (iii) In the event of your inability to perform your duties or
                  responsibilities thereunder, as a result of a Permanent
                  Disability (as defined below) upon written notice by the
                  Company. A "Permanent Disability" occurs when for a period of
                  ninety (90) consecutive calendar days, or an aggregate of one
                  hundred twenty (120) calendar days during any calendar year
                  (whether or not consecutive) you are unable to perform your
                  duties or responsibilities hereunder as a result of a mental
                  or physical ailment or incapacity. Upon the occurrence of a
                  Permanent Disability, the Company will evaluate your condition
                  and determine whether or not to send written notice of your
                  termination.

      (b)   Upon a voluntary resignation, you shall not be entitled to payment
            of any compensation other than salary under the Agreement, as
            amended, earned up to the date of such resignation, any accrued but
            unpaid vacation days, and any stock options, warrants or similar
            rights which have vested at the date of such resignation. The
            Company, in its sole and absolute discretion, may decide to continue
            to pay you your Annual Base Salary, for up to two (2) years after
            your voluntary resignation, in return for you not violating the
            RESTRICTIVE COVENANTS and/or provisions therein, for an equivalent
            period.

      (c)   Upon your death, the Company shall pay or grant, to such person as
            you designate in a notice filed with the Company, or, if no such
            person shall be designated, to your estate as a lump sum death
            benefit, an amount equal to any compensation under the Agreement, as
            amended, earned up to the date of your death, including salary and
            any accrued but unpaid vacation days. In addition, any stock options
            or warrants which have vested at the time of your death will be
            exercisable by your estate in accordance with the Company's Equity
            Incentive Plan. Your designated beneficiary or the executor of your
            estate, as the case may be, shall accept the payment provided for in
            this section, in full discharge and release of the Company of and
            from any further obligations under the Agreement, as amended.

      (d)   Upon your permanent disability, you shall be entitled to the benefit
            of disability or other relevant insurance or benefits provided. You
            shall not be entitled to payment of any compensation other than
            salary under the Agreement, as amended, earned up to the date of
            such permanent disability, any accrued but unpaid vacation days, and
            any stock options, warrants or similar rights which have vested at
            the date of such termination. The Company, in its sole and absolute
            discretion, may decide to continue to pay you your Annual Base
            Salary, for up to two (2) years after your voluntary resignation, in
            return for you not violating the RESTRICTIVE COVENANTS

<PAGE>

                                                                               9

            for an equivalent period and your execution, without revocation, of
            a Company Release of Claims upon the effective date of the
            termination of your employment.

24.02 Termination for Cause.

      (a)   The Company may terminate your employment for Cause by giving you
            written notice of such termination. For purposes of the Agreement,
            as amended, "Cause" for termination shall mean:

            (i)   the willful failure or refusal to carry out the reasonable
                  directions of the Chief Executive Officer or Board of
                  Directors, which directions are consistent with your duties as
                  set forth under the Agreement;

            (ii)  a willful act by you that constitutes gross negligence in the
                  performance of your duties under the Agreement, as amended,
                  and which materially injures the Company. No act, or failure
                  to act, by you shall be considered "willful" unless committed
                  without good faith and without a reasonable belief that the
                  act or omission was in the Company's best interest; or

            (iii) a conviction for a violation of a state or federal criminal
                  law involving the commission of a felony or other crime
                  involving moral turpitude.

      (b)   Upon termination for Cause, you shall not be entitled to payment of
            any compensation other than salary under the Agreement earned up to
            the date of such termination, any accrued but unpaid vacation days,
            and any stock options, warrants or similar rights which have vested
            at the date of such termination. The Company, in its sole and
            absolute discretion, may decide to continue to pay you your Annual
            Base Salary, for up to two (2) years after such termination for
            Cause, in return for you not violating the RESTRICTIVE COVENANTS for
            an equivalent period and your execution, without revocation, of a
            Company Release of Claims upon the effective date of the termination
            of your employment.

24.03 Termination Without Cause. Should your employment be terminated for a
      reason other than as specifically set forth above:

      (a)   You shall be paid the salary earned up to the date of such
            termination under the Agreement any accrued but unpaid vacation
            days, and any stock options, warrants or similar rights which have
            vested at the date of such termination.

      (b)   In addition, the Company, in its sole and absolute discretion, may
            decide to continue to pay you additional amounts (in monthly
            installments) equal to your Annual Base Salary as of the date of
            termination of employment in accordance with the Company's normal
            practices for other senior executives, for up to two (2) years
            following your termination, in return for you not violating the
            provisions of the RESTRICTIVE COVENANTS above, for an equivalent
            period and your execution, without revocation, of a Company Release
            of Claims at that time.

      (c)   All of the stock options, warrants, retirement benefits and other
            similar rights, if any, granted by the Company to you that are
            vested at the date of the termination of your employment, shall
            remain vested. All stock options that will vest between the date of
            such termination of employment and the completion of the Consulting
            Agreement will continue to vest on the vest dates stipulated in the
            grant document(s). All stock options unvested as of the completion
            of the Consulting Agreement will immediately expire. All stock
            options vested as of the completion of the Consulting Agreement will
            remain exercisable until the earlier of (i) the date such Stock
            Options would expire in accordance with their terms, and (ii) 90
            days after the date of completion of the

<PAGE>

                                                                              10

            Consulting Agreement, unless terminated earlier per the terms of the
            Consulting Agreement.

24.04 No Mitigation. You shall not be required to mitigate the amount of any
      payment provided for in the Termination without Cause Section, above, by
      seeking other employment or otherwise, nor shall the amount of any payment
      provided for under this section be reduced by any compensation earned by
      you, as a result of employment by another company, self-employment or
      otherwise.

In acknowledgment of your agreement to the terms and conditions of this
Agreement, please sign and return to Cathy McCutcheon, in Mission Viejo HR, the
duplicate copy of this letter.

JAMES HARDIE BUILDING PRODUCTS, INC.,
A California corporation

By: /s/ Louis Gries                       Oct 13, 2004
------------------------------            -------------
Louis Gries                               date
Executive VP Operations

James Chilcoff, an individual

/s/ James Chilcoff                        Oct 19, 2004
------------------------------            ------------
James Chilcoff                            date

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