Document:

EMPLOYMENT
AGREEMENT

     

    This
EMPLOYMENT AGREEMENT (the “Agreement”) is effective as of March 25, 2009 (the
“Effective Date”), by and between AMCOL International Corporation, a Delaware
corporation (the “Company”), and Gary L. Castagna (“Executive”).

     

    The Board
of Directors of the Company (the “Board”), has determined that it is in the best
interests of the Company and its stockholders to assure that the Company will
have the continued dedication of the Executive, notwithstanding the possibility,
threat or occurrence of a Change of Control (as defined herein).  The
Board believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending
or threatened Change of Control and to encourage the Executive’s full attention
and dedication to the Company in the event of any threatened or pending Change
of Control, and to provide the Executive with compensation and benefits
arrangements upon a Change of Control that ensure that the compensation and
benefits expectations of the Executive will be satisfied and that provide the
Executive with compensation and benefits arrangements that are competitive with
those of other corporations. In addition, the Board believes it is necessary to
provide a severance package that assures that the Company is able to attract and
retain the highest quality executive talent and to ensure that the
post-employment non-compete and non-solicitation restrictions are
enforceable.  Therefore, in order to accomplish these objectives, the
Board has caused the Company to enter into this Agreement.

     

    NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

     

    Article
I — DEFINITIONS

     

    The terms
set forth below have the following meanings:

     

    1.1           “Accrued
Annual Bonus” means the amount of any Annual Bonus earned but not yet paid with
respect to any fiscal year ended prior to the Date of Termination.

     

    1.2           “Accrued
Base Salary” means the amount of Executive’s Base Salary which is accrued but
not yet paid as of the Date of Termination.

     

    1.3           “Affiliate”
means any Person that directly or indirectly controls, is controlled by, or is
under common control with, the applicable Person.  For the purposes of
this definition, the term “control” when used with respect to any Person means
the power to direct or cause the direction of management or policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.

     

    1.4           “Anniversary
Date” means any annual anniversary of the Effective Date.

     

    1.5           “Annual
Bonus” - see Section 4.2.

     

    1.6           “Beneficial
Owner” means such term as defined in Rule 13d-3 (or any successor rule) under
the Exchange Act.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    1.7           “Cause”
means any of the following:

     

    (a)           Executive’s
commission of a felony or misdemeanor that involves fraud, dishonesty or moral
turpitude,

     

    (b)           Executive’s
willful or intentional material breach of this Agreement, or any material breach
of this Agreement that is not corrected within thirty (30) days of notice from
the Company,

     

    (c)           willful
or intentional material misconduct by Executive in the performance of his duties
under this Agreement,

     

    (d)           Executive
performs his duties in a manner that is grossly negligent, or

     

    (e)           Executive
fails to cooperate in any governmental investigations or
proceedings.

     

    For
purposes of clauses (b), (c), (d) and (e) of the preceding sentence, Cause shall
not include bad judgment or negligence which results from the Executive’s good
faith efforts to perform his duties.

     

    1.8           “Change
of Control” means the occurrence of any one or more of the
following:

     

    (a)           any
person (as such term is used in Rule 13d-5 under the Exchange Act) or group (as
such term is defined in Section 3(a)(9) and 13(d)(3) of the Exchange Act), other
than a Subsidiary, any employee benefit plan (or any related trust) of the
Company or any of its Subsidiaries or any Excluded Person, becomes the
Beneficial Owner of 50.1% or more of the outstanding common stock of the Company
or of Voting Securities representing 50.1% or more of the combined voting power
of the then outstanding voting securities of the Company (such a person or
group, a “Majority Owner”), except that (i) no Change of Control shall be deemed
to have occurred solely by reason of such beneficial ownership by a corporation
with respect to which both more than 49.9% of the common stock of such
corporation and Voting Securities representing more than 49.9% of the aggregate
voting power of such corporation are then owned, directly or indirectly, by the
persons who were the direct or indirect owners of the common stock and Voting
Securities of the Company immediately before such acquisition in substantially
the same proportions as their ownership, immediately before such acquisition, of
the common stock and Voting Securities of the Company, as the case may be and
(ii) such corporation shall not be deemed a Majority Owner; or

     

    (b)           the
Incumbent Directors (determined using the Effective Date as the baseline date)
cease for any reason to constitute at least one-half of the directors of the
Company then serving; or

    
      
         

      

      
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    (c)           the
consummation by the Company of a merger, reorganization, consolidation, or
similar transaction, or sale or other disposition of 50.1% of the consolidated
assets of the Company (any of the foregoing transactions, a “Reorganization
Transaction”) which is not an Exempt Reorganization Transaction.

     

    Notwithstanding
the occurrence of any of the foregoing events, a Change of Control shall not
occur with respect to Executive if, in advance of such event, the Executive
agrees in writing that such event shall not constitute a Change of
Control.

     

    1.9           “Code”
means the Internal Revenue Code of 1986, as amended from time to
time.

     

    1.10         “Compensation
Committee” means the Compensation Committee of the Board of Directors of the
Company.

     

    1.11         “Conflicting
Organization” means any person or entity which is engaged in or about to become
engaged in, research, development, production, manufacturing, importation,
marketing, licensing, selling, or servicing of a Conflicting
Product.

     

    1.12         “Conflicting
Product” means any product, process, system or service of any person or
organization other than the Company or an Affiliate, in existence or under
development, which is the same as or similar to or competes with a product,
process, system or service upon which Executive works or has worked during the
three year period ending on his Date of Termination, or about which Executive
acquired or acquires Confidential Information.

     

    1.13         “Date
of Termination” means the date of the receipt of the Notice of Termination by
Executive (if such Notice is given by the Company) or by the Company (if such
Notice is given by Executive), or any later date, not more than 15 days after
the giving of such Notice, specified in such notice; provided, however,
that:

     

    (a)           if
Executive’s employment is terminated by reason of death, the Date of Termination
shall be the date of Executive’s death; and

     

    (b)           if
Executive’s employment is terminated by reason of Disability, the Date of
Termination shall be the 30th day after Executive’s receipt of the physician’s
certification of Disability, unless, before such date, Executive shall have
resumed the full-time performance of Executive’s duties; and

     

    (c)           if
Executive terminates his employment without Good Reason, the Date of Termination
shall be determined by the Company, provided that it will not be later than the
90th day after the giving of such Notice; and

     

    (d)           if
no Notice of Termination is given, the Date of Termination shall be the last
date on which Executive is employed by the Company.

    
      
         

      

      
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    1.14         “Disability”
means (i) the Executive has a physical or mental condition which renders
Executive unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, or (ii) by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, the Executive is
receiving income replacement benefits for a period of not less than three months
under an accident and health plan covering the Executive that is sponsored by
the Company.

     

    1.15         “Employment
Period” - see Section 3.1.

     

    1.16         “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

     

    1.17         “Excluded
Person” means any of the Paul Bechtner Trust, Everett P. Weaver, any Named
Executive, any Affiliates or Family Member of any of the foregoing and any group
(as such term is defined in Section 3(a)(9) and 13(d)(3) of the Exchange Act) of
which any of the foregoing is a member.

     

    1.18         “Executive
Termination” means a Termination of Employment by Executive for any reason
including Good Reason or no reason during the 30-day period commencing twelve
months after a Change of Control.

     

    1.19         “Exempt
Reorganization Transaction” means a Reorganization Transaction which results (i)
in the Persons who were the direct or indirect owners of the outstanding common
stock and Voting Securities of the Company immediately before such
Reorganization Transaction becoming, immediately after the consummation of such
Reorganization Transaction, the direct or indirect owners of both more than
49.9% of the then-outstanding common stock of the Surviving Corporation and
Voting Securities representing more than 49.9% of the aggregate voting power of
the Surviving Corporation, in substantially the same respective proportions as
such Persons’ ownership of the common stock and Voting Securities of the Company
immediately before such Reorganization Transaction; (ii) in the Excluded Person
owning 50% or more of the common stock of the Surviving Corporation or Voting
Securities representing 50% or more of the combined voting power of the
Surviving Corporation; or (iii) from a transaction of any kind (including,
without limitation, a merger, reorganization, consolidation or similar
transaction or a plan or agreement for sale or other disposition of assets of
the Company or a plan of liquidation of the Company) pursuant to the Bankruptcy
Code of Title 11 of the United States Code, as amended from time to time, or any
similar or successor statute, domestic or foreign.

     

    1.20         “Family
Member” means, with respect to the applicable Person, a spouse, ancestor, lineal
descendant, or spouse of a lineal descendant, including without limitation
descendants by adoption.

     

    1.21         “Good
Reason” means the occurrence of any one of the following events unless Executive
specifically agrees in writing that such event shall not be Good
Reason:

     

    (a)           any
material breach of the Agreement by the Company, including without limitation,
Section 2.1, provided, however, that no breach of this Agreement shall
constitute Good Reason unless Executive gives the Company written notice of such
breach and the Company fails to cure such breach within 30
days;

    
      
         

      

      
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    (b)           the
failure of either the Company to assign this Agreement to a successor of the
Company or failure of a successor of the Company to expressly assume and agree
to be bound by the Agreement; or

     

    (c)           the
assignment to the Executive of any duties inconsistent in any respect with the
Executive’s position, authority, duties or responsibilities as contemplated by
this Agreement, or any action by the Company that results in a material
reduction in the nature or scope of Executive’s position, authority, duties or
responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and that is remedied by the Company
promptly after receipt of notice thereof given by the Executive.

     

    In the
event of an occurrence or omission constituting Good Reason as described in
subsections (a), (b) and (c) above, Executive shall provide notice to the Board
of any such reduction, change or breach upon which Executive intends to rely as
the basis for Good Reason within 30 days of the occurrence of such reduction,
change or breach.  The Company shall have 30 days following the
receipt of such notice to remedy the condition constituting such reduction,
change or breach and, if so remedied, any termination of Executive’s employment
hereunder on the basis of the circumstances described in such notice shall be
considered a voluntary termination of employment.  If the Company does
not remedy the condition that has been the subject of a notice as described in
this Section within 30 days of the Company’s receipt of such notice, Executive
must terminate his employment within 90 days following the occurrence of such
condition in order for such termination to be considered due to Good Reason for
purposes of this Agreement.

     

    1.22        
“Imminent Control Change Date” means any date on which occurs (i) a presentation
to the Company’s stockholders generally or any of the Company’s directors or
executive officers of a proposal or offer for a Change of Control, (ii) the
public announcement (whether by advertisement, press release, press interview,
public statement, SEC filing or otherwise) of a proposal or offer for a Change
of Control, and (iii) such proposal or offer remains effective and
unrevoked.

     

    1.23         “Incumbent
Directors” means, as of the date of this Agreement, individuals then serving as
members of the Board; provided that any subsequently-appointed or elected member
of the Board whose election, or nomination for election by stockholders of the
Company or the Surviving Corporation, as applicable, was approved by a vote or
written consent of at least one-half of the directors then comprising the
Incumbent Directors shall also thereafter be considered an Incumbent Director,
unless the initial assumption of office of such subsequently-elected or
appointed director was in connection with (i) an actual or threatened election
contest, including a consent solicitation, relating to the election or removal
of one or more members of the Board, (ii) a “tender offer” (as such term is used
in Section 14(d) of the Exchange Act), (iii) a proposed Reorganization
Transaction, or (iv) a request, nomination or suggestion of any Beneficial Owner
of Voting Securities representing 35% or more of the aggregate voting power of
the Voting Securities of the Company or the Surviving Corporation, as
applicable.

    
      
         

      

      
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    1.24         “Named
Executive” means any individual listed on Exhibit A except to the extent the
individual had a termination of employment not less than 120 days prior to the
applicable event potentially constituting a Change of Control and any other
employee or officer of the Company designated by the Board and who is a party to
an agreement substantially in the same form as this Agreement (with variation in
the amount of compensation and benefits payable under the agreement) and entered
into by the employee or officer not less than 120 days prior to the applicable
event potentially constituting a Change of Control.

     

    1.25         “Notice
of Termination” means a written notice given in accordance with Section 9.11
which sets forth (a) the specific termination provision in this Agreement relied
upon by the party giving such notice, (b) in reasonable detail the specific
facts and circumstances claimed to provide a basis for such Termination of
Employment, and (c) if the Date of Termination is other than the date of receipt
of such Notice of Termination, the Date of Termination.

     

    1.26         “Person”
means any individual, sole proprietorship, partnership, joint venture, limited
liability company, trust, unincorporated organization, corporation, institution,
public benefit corporation, entity or government instrumentality, division,
agency, body or department.

     

    1.27         “Prorata
Annual Bonus” means the portion of the Annual Bonus payable to Executive as
calculated on a pro rata basis, based on performance to date and on the number
of days which have elapsed in such fiscal year through the Date of
Termination.

     

    1.28         “Subsidiary”
means, with respect to any Person, (a) any corporation of which more than 50% of
the Voting Securities are at the time, directly or indirectly, owned by such
Person, and (b) any partnership or limited liability company in which such
Person has a direct or indirect interest (whether in the form of voting or
participation in profits or capital contribution) of more than 50%.

     

    1.29         “Surviving
Corporation” means the corporation resulting from a Reorganization Transaction
or, if securities representing more than 50% of the aggregate Voting Power of
such resulting corporation are directly or indirectly owned by another
corporation, such other corporation.

     

    1.30         “Target
Annual Bonus” - see Section 4.2.

     

    1.31  
      “Target Annual Goals” - see Section
4.2.

     

    1.32         “Taxes”
means the incremental federal, state, local and foreign income, employment,
excise and other taxes payable by Executive with respect to any applicable item
of income.

     

    1.33         “Termination
For Good Reason” means a Termination of Employment by Executive for a Good
Reason.

    
      
         

      

      
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    1.34         “Termination
of Employment” means a termination by the Company or Executive of Executive’s
employment.

     

    1.35         “Termination
Without Cause” means a Termination of Employment by the Company for any reason
other than Cause or Executive’s death or Disability.

     

    1.36         “Voting
Securities” of a corporation means securities of such corporation that are
entitled to vote generally in the election of directors of such corporation, but
not including any other class of securities of such corporation that may have
voting power by reason of the occurrence of a contingency.

     

    Article
II —
DUTIES

     

    2.1           Duties.  During
the Employment Period, (A) the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities shall
be at least commensurate in all material respects with the most significant of
those held, exercised and assigned at any time during the 90-day period
immediately preceding the Effective Date and, (B) following any Change of
Control, the Executive’s services shall be performed at the office where the
Executive was employed immediately preceding the effective date of the Change of
Control, or at any other location less than 50 miles from such
office.  Executive shall devote all of his business time, attention
and effort during normal business hours, excluding any periods of disability,
vacation, or sick leave to which Executive is entitled, to the affairs of the
Company and shall use his best efforts to promote the interests of the
Company.

     

    2.2           Other
Activities.  Executive may serve on civic or charitable boards
or committees, deliver lectures, fulfill speaking engagements or teach at
educational institutions, and manage personal investments; provided that such
activities do not significantly interfere with the performance of Executive’s
duties under this Agreement.  Executive may serve on corporate boards
or committees with the prior written consent of the Board.

     

    Article III —
EMPLOYMENT PERIOD

     

    Subject
to the termination provisions provided herein, the term of Executive’s
employment under this Agreement (the “Employment Period”) shall begin on the
Effective Date and end on the second annual Anniversary Date or, such later date
to which the Employment Period is extended pursuant to the following
sentence.  On the date which is twenty-one months after the Effective
Date and thereafter, the Employment Period (assuming that an Expiration Notice
to the effect that the Agreement shall expire on the second annual Anniversary
Date has not been delivered by the Executive or Company to the other prior to
such date) shall be automatically extended each day by one day to create a new
three-month term until, at any time after the date which is twenty-one months
after the Effective Date the Company delivers written notice (an “Expiration
Notice”) to Executive or Executive delivers an Expiration Notice to the Company,
in either case, to the effect that the Agreement shall expire on a date
specified in the Expiration Notice (the “Expiration Date”) that is not less than
three months after the date the Expiration Notice is delivered to the Company or
the Executive, respectively.  The employment of Executive by the
Company shall not be terminated other than in accordance with Article
VI.

    
      
         

      

      
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    Article IV —
COMPENSATION

     

    4.1           Salary.  Subject
to Section 4.3 hereof, during the Employment Period, the Company shall pay or
cause to be paid to Executive in accordance with its normal payroll practices
(but not less frequently than monthly) an annual salary at a rate of $315,000
per year (“Base Salary”).  During the Employment Period, the Base
Salary shall be reviewed at least annually and may be increased from time to
time as shall be determined by the Compensation Committee.  After any
such increase, the term “Base Salary” shall thereafter refer to the increased
amount.  Any increase in Base Salary shall not limit or reduce any
other obligation of the Company to Executive under this
Agreement.  Base Salary shall not be reduced at any time without the
express written consent of Executive.

     

    4.2           Annual
Bonus.

     

    (a)           Subject
to Section 4.3 hereof, the Company shall pay or cause to be paid to Executive an
annual cash bonus (“Annual Bonus”) in accordance with the terms of the AMCOL
International Corporation 2006 Annual Cash Incentive Plan and the terms hereof
for each fiscal year which begins or ends during the Employment
Period.  Executive shall be eligible for an Annual Bonus based upon
target performance goals (the “Target Annual Goals”), as determined by the
Compensation Committee for a payment of at least 60% of Executive’s Base Salary
(“Target Annual Bonus”) upon the Executive’s achievement of the Target Annual
Goals.  The Target Annual Goals shall be set as described above no
later than February 28 of each fiscal year.

     

    (b)           Subject
to Section 4.3 hereof, the Company shall pay or cause to be paid the entire
Annual Bonus that is payable with respect to a fiscal year in cash after the
Compensation Committee has certified (i) whether and the degree to which Target
Annual Goals have been achieved, and (ii) the amount of the Annual Bonus, which
shall occur as soon as practicable following the close of such fiscal
year.  Any such Annual Bonus shall in any event be paid no later than
February 28 of each fiscal year.

     

    4.3           Deferral.  In
the event that all or any portion of a payment to be made to Executive pursuant
to Section 4.1 or 4.2 hereof or any equity compensation award shall be
ineligible for treatment as “qualified performance - based compensation” under
Section 162(m) of the Code, the Company, in its sole discretion, shall have the
right to defer payment to Executive of all or any portion of any such payment
until such time as such amounts are deductible by the Company under Section
162(m) of the Code; provided that such deferral shall be limited to the portion
of the payment that is not deductible by the Company pursuant to the
Code.

    
      
         

      

      
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    Article V — OTHER
BENEFITS

     

    5.1           Stock Option, Restricted
Stock and Other Equity Incentive Plans.  In addition to Base
Salary and an Annual Bonus, Executive shall be eligible to participate during
the Employment Period in all stock option, restricted stock and other equity
incentive plans, practices, policies and programs of the Company, in accordance
with their terms as in effect from time to time. If a Change of Control occurs
during the Employment Period, all outstanding stock options, restricted stock
and other equity compensation granted to Executive (whether before, on or after
the Effective Date) shall become fully vested and exercisable, except as
otherwise provided with respect to an award intended to qualify as
performance-based compensation under Section 162(m) of the Code.

     

    5.2           Incentive, Savings and
Retirement Plans.  In addition to Base Salary, Annual Bonus,
and equity awards, Executive shall be entitled to participate during the
Employment Period in all incentives, savings and retirement plans, practices,
policies and programs that are from time to time applicable to other comparable
senior executives of the Company, including any supplemental executive
retirement plan, in accordance with their terms as in effect from time to
time.

     

    5.3           Welfare
Benefits.  During the Employment Period, Executive and his
family shall be eligible to participate in, and shall receive all benefits
under, welfare benefit plans, practices, policies and programs provided by the
Company (including medical, prescription, dental, disability, employee life,
group life, dependent life, accidental death and travel accident insurance plans
and programs) applicable to other comparable senior executives of the Company,
in accordance with their terms as in effect from time to time.

     

    5.4           Fringe
Benefits.  During the Employment Period, Executive shall be
entitled to fringe benefits applicable to other comparable senior executive of
the Company, in accordance with their terms as in effect from time to
time.

     

    5.5           Vacation.  During
the Employment Period, Executive shall be entitled to paid vacation time in
accordance with the plans, practices, policies, and programs applicable to other
comparable senior executives of the Company, in accordance with their terms as
in effect from time to time, but in no event shall such vacation time be less
than four weeks per calendar year.

     

    5.6           Expenses.  During
the Employment Period, Executive shall be entitled to receive prompt
reimbursement for all reasonable employment-related expenses incurred by
Executive upon the receipt by the Company of an accounting in accordance with
practices, policies, and procedures applicable to comparable senior executives
of the Company, in accordance with their terms as in effect from time to
time.

     

    Article VI —
TERMINATION BENEFITS

     

    6.1           Termination for Cause or
Other than for Good Reason, etc.  If the Company terminates
Executive’s employment for Cause (whether before or after a Change of Control)
or Executive terminates his employment other than for Good Reason, death or
Disability, or Executive Termination, the Company shall pay to Executive
immediately after the Date of Termination an amount equal to the sum of
Executive’s Accrued Base Salary and Accrued Annual Bonus and Executive shall not
be entitled to receive any severance payment.

    
      
         

      

      
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    6.2           Termination for Death or
Disability Prior to Change of Control or More than Thirteen Months after a
Change of Control.  If Executive’s employment terminates due to
his death or Disability prior to a Change of Control or more than thirteen
months after a Change of Control, the Company shall pay to Executive or his
beneficiaries, as the case may be, (i) immediately after the Date of Termination
an amount which is equal to the sum of Executive’s Accrued Base Salary and
Accrued Annual Bonus, and (ii) at the time described in Section 4.2(b), an
amount which is equal to the Executive’s Prorata Annual Bonus.

     

    6.3           Termination Without Cause or
for Good Reason Prior to Change of Control or More than Thirteen Months After a
Change of Control.  In the event of a Termination Without Cause
or a Termination for Good Reason prior to a Change of Control or more than
thirteen (13) months after a Change of Control, Executive shall receive the
following:

     

    (a)           immediately
after the Date of Termination, a lump sum amount in immediately available funds
equal to the sum of Executive’s Accrued Base Salary and Accrued Annual
Bonus;

     

    (b)           at
the time described in Section 4.2(b), an amount which is equal to the
Executive’s Prorata Annual Bonus;

     

    (c)           Base
Salary payable on the same basis as in effect immediately prior to the Date of
Termination for eighteen (18) months following the Executive’s Date of
Termination, provided that if the Date of Termination occurs between September
15th and December 31st, the Executive will be paid on the same basis as in
effect immediately prior to the Date of Termination for the period through March
14th of the following year, at which time all payments will be suspended until
the day after the six-month anniversary of the Date of Termination (the
“Suspension Period”), at which time all payments suspended during the Suspension
Period will be paid in a lump sum and the normal payment schedule will
resume.  Each of these payments shall be a separate payment for
purposes of Section 409A of the Code;

     

    (d)           other
than in the event of death, the Executive and his dependents will continue to be
eligible for coverage, at the Company’s cost and expense, under the Company’s
group health, dental and prescription group plans for a period commencing on the
Executive’s Date of Termination and ending on the earlier of (i) 18 months after
the Executive’s Date of Termination and (ii) the date on which the Executive
accepts a position with another employer. The Executive acknowledges that under
the Code, these amounts will be treated as imputed income to him for income tax
purposes; and

     

    (e)           if
the Executive’s group health, dental and prescription coverage continues for 18
months under subsection (d) above, then following the expiration of the 18-month
period, the Executive and his dependents will continue to be eligible for
coverage, at the Executive’s cost and expense, under the Company’s group health,
dental and prescription group plans until the earliest of (i) the Executive's
eligibility for Medicare benefits, (ii) the date on which the Executive accepts
a position with another employer; or (iii) the date the Executive ceases paying
for such coverage.

    
      
         

      

      
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    Notwithstanding
any provisions of this Section 6.3 to the contrary, if Executive breaches any or
all of the provisions of Sections 7.1 and 7.2, the payment of the Prorata Annual
Bonus pursuant to Section 6.3(b), any payments due under Sections 6.3(c) and the
continuation or eligibility for benefits under Section 6.3(d) or (e) shall cease
immediately upon such breach.  In addition to the foregoing, and to
protect and compensate the Company in the event of such breach by the Executive,
the Company shall be entitled to any and all remedies at law and equitable
relief as described in Section 7.3.

     

    6.4           Termination After Change of
Control.  In the event of a Termination Without Cause or a
Termination for Good Reason within thirteen (13) months after a Change In
Control, or Termination of Employment due to death or Disability within thirteen
(13) months following a Change of Control, or an Executive Termination after a
Change In Control, the Executive shall receive the following:

     

    (a)           immediately
after the Date of Termination, a lump sum amount in immediately available funds
equal to the sum of Executive’s Accrued Base Salary, Accrued Annual Bonus and
Prorata Annual Bonus; 

     

    (b)           six-months
and one day following his Date of Termination, a lump sum amount in immediately
available funds equal to three (3) times the sum of (i) the Executive’s Base
Salary and (ii) the greater of the following amounts:  (x) 60% of
Executives Base Salary for the fiscal year during which the Date of Termination
occurs and (y) the average of the Annual Bonuses paid or payable to Executive
for the three most recent fiscal years ended on or before such date;
and

     

    (c)           other
than in the event of death, the Executive and his dependents will continue to be
eligible for coverage, at the Company’s cost and expense, under the Company’s
group health, dental and prescription group plans for a period commencing on the
Executive's Date of Termination and ending on the earlier of (i) 36 months after
the Executive's Date of Termination and (ii) the date on which the Executive
accepts a position with another employer.  The Executive acknowledges
that under the Code, these amounts will be treated as imputed income to him for
income tax purposes.

     

    (d)           if
the Executive’s group health, dental and prescription coverage continues for 36
months under subsection (c) above, then following the expiration of the 36-month
period, the Executive and his dependents will continue to be eligible for
coverage, at the Executive’s cost and expense, under the Company’s group health,
dental and prescription group plans until the earliest of (i) the Executive's
eligibility for Medicare benefits, (ii) the date on which the Executive accepts
a position with another employer; or (iii) the date the Executive ceases paying
for such coverage.

    
      
         

      

      
        11

        
          

        

      

      
         

      

    

    Notwithstanding
any provisions of this Section 6.4 to the contrary, if Executive breaches any or
all of the provisions of Sections 7.1 and 7.2, the continuation of payments and
benefits pursuant to this Section 6.4 shall cease upon such breach and, to
prevent the Executive’s unjust enrichment, the Executive shall immediately pay
the Company an amount equal to (i) the amount that the Executive received from
the Company pursuant to this Section 6.4, multiplied by (ii) a fraction of which
the numerator is the number of days remaining from the date of the breach
through the first anniversary of the Executive’s Termination of Employment and
the denominator of which is 365.  In addition to the foregoing, and to
protect and compensate the Company in the event of such breach by the Executive,
the Company shall be entitled to any and all remedies at law and equitable
relief as described in Section 7.3.

     

    6.5           Imminent Control
Change.  If an Imminent Control Change Date occurs on or within
30 days after the date on which the Company delivers a Notice of Termination to
Executive terminating Executive’s employment not for Cause and if a Change of
Control occurs within twelve months after delivery of the Notice, the
Executive’s Termination of Employment pursuant to the Notice shall be deemed a
Termination of Employment Without Cause on or after a Change of Control and the
Executive’s rights and obligations shall be determined under Section 6.4 rather
than Section 6.3.  Any payments or benefits to be received by the
Executive pursuant to Section 6.4 shall be reduced by any payments or benefits
made or provided pursuant to Section 6.3.  If an Imminent Control
Change Date occurs on or within 30 days after the date on which the Executive
has a Termination of Employment due to death or Disability and if a Change of
Control occurs within twelve months after death or Disability, the Executive’s
Termination of Employment due to death or Disability shall be deemed a
Termination of Employment due to death or Disability on or after a Change of
Control and the Executive’s beneficiaries’ rights and obligations shall be under
Section 6.4 rather than Section 6.2.  Any payments or benefits to be
received by the Executive’s Beneficiaries pursuant to Section 6.4 shall be
reduced by any payments or benefits made or provided pursuant to Section
6.2.

     

    6.6           Other
Rights.  Except as specifically provided herein, this Agreement
shall not prevent or limit Executive’s continuing or future participation in any
benefit, bonus, incentive or other plan, program or policy provided by the
Company and for which Executive may qualify, nor shall this Agreement limit or
otherwise affect such rights Executive may have under any other agreements with
the Company.  Amounts which are vested benefits or which Executive is
otherwise entitled to receive under any plan, program or policy and any other
payment or benefit required by law at or after the Date of Termination shall be
payable in accordance with such plan, program or policy or applicable law except
as expressly modified by this Agreement.

     

    6.7           Termination
Rights.  Executive recognizes and agrees that the Company has
the right to terminate his employment for any reason or no reason and that upon
such termination the Executive’s sole right is to receive compensation and
benefits in accordance with the terms of this Agreement.

    
      
         

      

      
        12

        
          

        

      

      
         

      

    

    Article VII —
COVENANTS

     

    7.1           Non-Disclosure and
Non-Solicitation.  Executive acknowledges that the successful
marketing and development of the Company’s products requires substantial time
and expense.  Such efforts utilize and generate valuable confidential
and proprietary information, of which Executive will obtain knowledge during the
course of his employment with the Company.  As used herein,
“Confidential Information” means any information of the Company that the Company
considers to be proprietary and treats as confidential or information of any
third party that the Company is under an obligation to keep confidential,
including but not limited to the following: (i) trade secrets, confidential
knowledge, data or other proprietary information relating to products,
processes, know-how, designs, formulas, developmental or experimental work, (ii)
employment status, salaries and other personnel information, decisions to offer
employment, pre-employment testing and screening results, citizenship status,
disability status, performance issues, executive evaluations, medical problems
of executives and executives’ families, garnishments and levies against wages,
contents of employment agreements, statements regarding the financial condition
of the Company or any subsidiary or affiliated entity, payments made to or
expenses incurred by the Company or any of its executives, shareholders or
directors, discounts given by the Company, vendors and other parties, minutes of
Board meetings of the Company or any subsidiary or affiliated entities, contents
of contracts, legal matters by or against the Company or any subsidiary or
affiliated entities, business strategies, plans, proposals, names of customers
and potential customers; and (iii) other information or materials of the Company
marked or noticed by the Company as being confidential, whether constituting a
trade secret or not, and whether proprietary or not, which are of value to the
Company.  For purposes of this Agreement, Confidential Information
includes the foregoing and other information protected under the Illinois Trade
Secrets Act.  Confidential Information does not include: (i)
information that at the time of disclosure is in the public domain through no
fault of Executive; (ii) information received from a third party outside of the
Company that was disclosed without a breach of any confidentiality obligation;
(iii) information approved for public release by written authorization of the
Company; or (iv) information that is required by law or an order of any court,
agency or proceeding to be disclosed.  Executive acknowledges and
agrees that the Company shall retain exclusive ownership of all right, title,
and interest in the Confidential Information, including any and all worldwide
copyrights, trade secrets, patent, and confidential and proprietary information
rights.  Executive agrees to undertake the following obligations,
which Executive acknowledges to be reasonably designed to protect the Company’s
legitimate business interests without unnecessarily or unreasonably restricting
Executive’s post-employment opportunities:

     

    (a)           Executive
agrees that he will not at any time, whether during or after the cessation of
his employment, reveal or permit any other person or entity to reveal, any of
the Confidential Information to any person or any entity, except, and only to
the extent, as may be required in the ordinary course of performing Executive’s
assigned duties as an Executive of the Company, and Executive agrees to keep
secret, and take all necessary precautions against disclosure of, all
Confidential Information and all matters entrusted to him and not to use or
attempt to use any Confidential Information in any manner that may cause injury
or loss, or may be calculated to cause injury or loss, whether directly or
indirectly, to the Company or its customers;

     

    (b)           Executive
agrees that during and after his employment he shall not remove, copy, duplicate
or otherwise reproduce, use or permit to be used any notes, memoranda, reports,
lists, records, drawings, sketches, specifications, software programs, data,
documentation or other materials of any nature relating to any matter within the
scope of the business of the Company or concerning any of its dealings or
affairs except as required to perform Executive’s duties for the
Company;

    
      
         

      

      
        13

        
          

        

      

      
         

      

    

    (c)           Upon
cessation of his employment relationship with the Company, Executive shall
immediately deliver to the Company all Confidential Information and other
materials relating to the Company in his possession or delivered to him by the
Company, including computer programs, files, notes, records, memoranda, reports,
lists, drawings, sketches, specifications, data, charts, and other documents,
materials and things (“Materials”), whether or not containing Confidential
Information, whether or not prepared by Executive, it being agreed that all
Materials shall be and remain the sole and exclusive property of the
Company;

     

    (d)           Without
limiting the obligations of Section 7.1(c), Executive agrees that while
Executive is employed by the Company prior to his Date of Termination and for a
period of one year following his Date of Termination he will not, whether alone
or as employee, owner, partner, officer, director, consultant, agent, executive,
independent contractor, or stockholder of any firm, corporation or other
commercial enterprise, directly or indirectly solicit business from: (i) any
customer of the Company with which Executive had contact, participated in the
contact, or about which Executive had knowledge of Confidential Information by
reason of Executive’s employment with the Company within the one year period
preceding the Date of Termination, or (ii) any current customer prospect of the
Company for whom Executive directly or indirectly assisted in the preparation or
submission of a proposal made by the Company to such customer prospect during
the one year period preceding the Date of Termination, unless the Company
acknowledges in writing its intent not to further pursue such customer prospect;
provided, further, that Executive shall, however, be permitted to own securities
of any public company not in excess of 5% of any class of such securities and to
own stock, partnership interests or other securities of any non-public entity
not in excess of 5% of any class of such securities, and such ownership shall
not be considered to be in competition with the Company; and

     

    (e)           Except
as may be required in the ordinary course of performing his duties as an
employee of the Company, while employed prior to his Date of Termination and
during the one year period immediately following the Date of Termination,
Executive shall not, directly or indirectly, solicit or attempt to solicit any
employee of the Company to work for any person, partnership or entity other than
the Company, or engage in any activity that would cause any such employee to
violate any agreement with the Company, or dissuade, or attempt to dissuade, any
such employee from faithfully discharging such employee’s contractual and
fiduciary obligations to serve the Company’s interests with undivided
loyalty.

     

    7.2           Non
Competition.  Without limiting the obligation imposed by
Section 7.1, and to more fully protect the Confidential Information, Executive
hereby agrees that while he is employed by the Company prior to the Date of
Termination and for a period of one year following the Date of Termination, he
will not, directly or indirectly, anywhere in the world where the Company
conducts business, render services to any Conflicting Organization in any
capacity in which the Confidential Information of the Company would reasonably
be considered to be useful to the Conflicting Organization; provided, however,
that Executive may render services to a Conflicting Organization (and which has
separate and distinct divisions), as long as such services are being rendered
solely to a part of the business that is separate and distinct from the part of
the business that renders such person or entity a Conflicting
Organization.

    
      
         

      

      
        14

        
          

        

      

      
         

      

    

     

    If, at the time of enforcement of
Sections 7.1 and 7.2, a court shall hold that the duration, scope, area or
activity restrictions stated herein are unreasonable under circumstances then
existing, the parties agree that the maximum duration, scope, area or activity
restrictions reasonable and enforceable under such circumstances shall be
substituted for the stated duration, scope, area or activity
restrictions.

     

    7.3           Remedies.  Executive
recognizes and agrees that a breach of any or all of the provisions of Sections
7.1 and 7.2 will constitute immediate and irreparable harm to the Company for
which damages cannot be readily calculated and for which damages are an
inadequate remedy.  Accordingly, Executive acknowledges that in
addition to any and all remedies at law, the Company shall be entitled, without
bond, to specific performance or injunctive or other equitable relief to prevent
the breach or threatened breach of Executive’s obligations under this
Agreement.

     

    7.4           Intellectual
Property.  During the employment period, Executive shall
disclose immediately to the Company all ideas, inventions and business plans
that he makes, conceives, discovers or develops during the course of his
employment with the Company, including any inventions, modifications,
discoveries, developments, improvements, computer programs, processes, products
or procedures (whether or not protectable upon application by copyright, patent,
trademark, trade secret or other proprietary rights) (“Work Product”) that: (i)
relate to the business of the Company or any customer or supplier to the Company
or any of the products or services being developed, manufactured, sold or
otherwise provided by the Company or that may be used in relation therewith;
(ii) result from tasks assigned to Executive by the Company; or (iii) result
from the use of the premises or personal property (whether tangible or
intangible) owned, leased or contracted for by the Company.  Executive
agrees that any Work Product shall be the property of the Company and, if
subject to copyright, shall be considered a “work made for hire” within the
meaning of the Copyright Act of 1976, as amended (the “Act”).  If and
to the extent that any such Work Product is found as a matter of law not to be a
“work made for hire” within the meaning of the Act, Executive expressly assigns
to the Company all right, title and or interest in and to the Work Product, and
all copies thereof, and the copyright, patent, trademark, trade secret and all
their proprietary rights in the Work Product, without further consideration,
free from any claim, lien for balance due or rights of retention thereto on the
part of Executive.

     

    (a)           To
the extent applicable, pursuant to Illinois Employee Patent Act, the Company
hereby notifies Executive that the preceding paragraph does not apply to any
inventions for which no equipment, supplies, facility, or trade secret
information of the Company was used and which was developed entirely on the
Executive’s own time, unless: (i) the invention relates (a) to the Company’s
business, or (b) to the Company’s actual or demonstrably anticipated research or
development, or (ii) the invention results from any work performed by the
Executive for the Company.

    
      
         

      

      
        15

        
          

        

      

      
         

      

    

     

    (b)           Executive
agrees that upon disclosure of Work Product to the Company, Executive will,
during his employment and at any time thereafter, at the request and cost of the
Company execute and deliver all such documents and perform all such acts as the
Company or its duly authorized agents may reasonably require: (i) to apply for,
obtain and vest in the name of the Company alone (unless the Company otherwise
directs) letters patent, copyrights or other analogous protection in any country
throughout the world, and when so obtained or vested to renew and restore the
same; and (ii) to defend any opposition proceedings in respect of such
applications and any opposition proceedings or petitions or applications for
revocation of such letters patent, copyright or other analogous
protection.

     

    (c)           In
the event that the Company is unable, after reasonable effort, to secure
Executive’s signature on any letters patent, copyright or other analogous
protection relating to Work Product, whether because of Executive’s physical or
mental incapacity or for any other reason whatsoever, Executive hereby
irrevocably designates and appoints the Company and its duly authorized officers
and agents as his agent and attorney-in-fact, to act for and on his behalf to
execute and file any such application or applications and to do all other
lawfully permitted acts to further the prosecution and issuance of letters
patent, copyright and other analogous protection with the same legal force and
effect as if personally executed by Executive.

     

    Article VIII —
LIMITATION ON PAYMENTS AND BENEFITS

     

    Notwithstanding
any provision of this Agreement to the contrary, if any amount or benefit to be
paid or provided under this Agreement would be an “Excess Parachute Payment”
within the meaning of Section 280G of the Code or any successor provision
thereto(which the parties agree will not include any portion of payments
allocated to the non-solicitation and non-compete provisions of Article VII
which are classified as payments of reasonable compensation for purposes of
Section 280G of the Code), then the payments and benefits to be paid or provided
under this Agreement shall be reduced to the minimum extent necessary so that no
portion of any such payment or benefit as so reduced constitutes an Excess
Parachute Payment.

     

    Article IX —
MISCELLANEOUS

     

    9.1           Clawback
Provision.  In the event of a restatement of the Company’s
previously issued financial statements, the Board will review the circumstances
regarding the restatement and all performance-based compensation awarded to the
Executive that is attributable to performance during the time periods
restated.  If the Board determines that (i) the restatement is
required due to the failure of the Company’s management to act reasonably and
(ii) the Executive received more compensation than he would have received absent
the restated financial statements, then the Board will take action to recoup any
such excess compensation and the Executive agrees to repay such
amount.  Notwithstanding any other provision in this Agreement, in
such event, the Executive may be required to (x) repay some or all of any bonus
or other performance-based compensation received, (y) repay any gains realized
on the exercise of stock options or on the open-market sale of vested shares; or
(z) have his future compensation adjusted.  In the event the Executive
does not agree with the Board’s determination as to (A)  whether the
restatement is required due to the failure of the Company’s management to act
reasonably or (B) the amount of the excess compensation received, the Executive
may submit the matter to binding arbitration in Chicago, Illinois (unless the
parties agree in writing to a different location), before a single arbitrator in
accordance with the American Arbitration Association’s National Rules for the
Resolution of Employment Disputes then in effect. The decision and award made by
the arbitrator shall be final, binding and conclusive on all parties hereto for
all purposes, and judgment may be entered thereon in any court having
jurisdiction thereof.  Except as set forth below, the Company shall
pay the costs of the arbitration, including administrative fees and the fees of
the arbitrator.  Each party shall be responsible for the fees and
costs of their attorneys and  the expenses of their
witnesses.

    
      
         

      

      
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    9.2           Approvals. The
Company represents and warrants to Executive it has taken all corporate action
necessary to authorize this Agreement.

     

    9.3           Full
Settlement.  The exclusive method for the Company to terminate
its obligations to provide compensation or benefits to Executive pursuant to
Articles IV and V of this Agreement is to terminate Executive’s employment in
compliance with all applicable requirements of Sections 6.1, 6.2, 6.3, 6.4 or
6.5 of this Agreement, as applicable, and to make the payments and provide the
benefits specified in such applicable Section.

     

    9.4           No
Mitigation.  In no event shall Executive be obligated to seek
other employment or take any other action to mitigate the amounts payable to
Executive under any of the provisions of this Agreement, nor shall the amount of
any payment hereunder be reduced by any compensation earned as a result of
Executive’s employment by another employer, except that any continued welfare
benefits provided for by Section 6.3(f) or Section 6.4(c) shall not duplicate
any benefits that are provided to Executive and his family by such other
employer and shall be secondary to any coverage provided by such other
employer.

     

    9.5           Enforcement.  If
the Company fails to pay any amount provided under this Agreement when due, the
Company shall pay interest on such amount at an annual rate equal to the lesser
of (i) (A) the highest rate of interest charged by the Company’s principal
lender on its revolving credit agreements plus 200 basis points, or (B) in the
absence of such a lender, 200 basis points over the prime commercial lending
rate announced by The Wall Street Journal in effect from time to time during the
period of such nonpayment, or (ii) the highest legally-permissible interest rate
allowed to be charged under applicable law.

     

    9.6           Release.  Notwithstanding
any provisions of this Agreement to the contrary, the Company’s obligations to
make payments under Sections 6.3, 6.4 and 6.5, other than the obligation to pay
Accrued Base Salary and Accrued Annual Bonus (the “Termination Payments”), are
expressly conditioned upon the Executive’s execution of a release and waiver
substantially in the form attached hereto as Exhibit B (the “Release”), and the
expiration of the revocation period.  The Company shall deliver a copy
of the Release to Executive within five (5) days following Executive’s
termination of employment and, within forty-five (45) days thereafter, the
Release shall be executed and returned to the Company by
Executive.  Termination Payments shall commence pursuant to the
schedules provided herein on the first practicable payroll date following the
expiration of the revocation period or the 60th day following the Executive’s
termination of employment, whichever comes last.

    
      
         

      

      
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    9.7           Beneficiary.  If
Executive dies prior to receiving all of the amounts payable to him in
accordance with the terms and conditions of this Agreement, such amounts shall
be paid to the beneficiary designated by Executive in writing to the Company
during his lifetime, or if no such beneficiary is designated, to Executive’s
estate.  Such payments shall be made in a lump sum to the extent so
payable and, to the extent not payable in a lump sum, in accordance with the
terms of this Agreement.  Such payments shall not be less than the
amount payable to Executive as if Executive had lived to the date of payment and
were the payee.  Executive, without the consent of any prior
beneficiary, may change his designation of beneficiary or beneficiaries at any
time or from time to time by submitting to the Company a new designation in
writing.

     

    9.8           Assignment;
Successors.  The Company may not assign its respective rights
and obligations under this Agreement without the prior written consent of
Executive except to a successor of the Company’s business.  This
Agreement shall be binding upon and inure to the benefit of Executive, his
estate and Beneficiaries, the Company and the successors and permitted assigns
of the Company.

     

    9.9           Non-Alienation.  Except
as is otherwise expressly provided herein, benefits payable under this Agreement
shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy of any
kind, either voluntary or involuntary, prior to actually being received by
Executive, and any such attempt to dispose of any right to benefits payable
hereunder shall be void.

     

    9.10           Severability.  If
all or any part of this Agreement is declared 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 provision so
declared to be unlawful or invalid shall, if possible, be construed in a manner
which will give effect to the terms of such provision to the fullest extent
possible while remaining lawful and valid.

     

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

     

    9.12           Notices.  All
notices hereunder shall be in writing and delivered by hand, by
nationally-recognized delivery service that guarantees overnight delivery, or by
first-class, registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

    
      
         

      

      
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                  If
      to the Company, to:

                	
                  Corporate
      Secretary

                
	 
      	
                  AMCOL
      International Corporation

                
	 
      	
                  2870
      Forbs Avenue

                
	 
      	
                  Hoffman
      Estates, IL 60192

                
	 
      	 
      
	
                  If
      to Executive, to:

                	
                  His
      most recent home
address.

                

        

      

    

     

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

     

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

     

    9.14           Captions.  The
captions of this Agreement are not a part of the provisions hereof and shall
have no force or effect.

     

    9.15           Section
409A.  The parties intend that the compensation and benefits to
be provided under this Agreement shall be exempt from or compliant with the
requirements of Code Section 409A of the Code and this Agreement shall be
interpreted and applied in a manner consistent with such
intent.  Notwithstanding anything in this Agreement to the contrary,
if payment of any amounts under this Agreement would be subject to additional
taxes and interest under Code Section 409A because the timing of such payments
is not delayed as provided in Section 409A(a)(2)(B)(i) of the Code and the
regulations thereunder, then any such payments to which Executive would
otherwise be entitled during the first six months following the date of his
Termination of Employment shall be accumulated and paid on the second business
day that is six months after the date of such Termination of Employment with
Company, or such earlier date upon which such payments can be paid under Code
Section 409A of the Code without being subject to such additional taxes and
interest.  Further, notwithstanding anything in this Agreement to the
contrary, if benefits to be made available under this Agreement would be subject
to additional taxes and interest under Code Section 409A because the provision
of such benefits is not delayed for the first six months following the date of
Executive’s Termination of Employment with Company as provided in Code Section
409A(a)(2)B)(i) of the Code and the regulations thereunder, such benefits shall
not be delayed; however, Executive shall pay to Company, at the time or times
such benefits are provided, the fair market value of such benefits, and Company
shall reimburse Executive for any such payments on or within ten days following
the expiration of such six-month period.  Executive hereby agrees to
be bound by Company’s determination of its “specified employees” (as such term
is defined in Code Section 409A) in accordance with any of the methods permitted
under the regulations issued under Code Section 409A of the Code, which shall be
determined annually by the Company.  The Company makes no
representation or warranty and shall have no liability to Executive or any other
person if any provisions of this Agreement are determined to constitute deferred
compensation subject to Code Section 409A but do not satisfy an exemption from,
or the conditions of, such section.

    
      
         

      

      
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    9.16           Entire
Agreement.  As of the Effective Date, this Agreement will form
the entire agreement between the parties hereto with respect to the subject
matter contained in the Agreement and shall supersede all prior agreements,
promises and representations regarding employment, compensation, severance or
other payments contingent upon termination of employment, whether in writing or
otherwise, including but not limited to that certain Employment Agreement dated
March 24, 2006 by and between the Company and the Executive.

     

    9.17           Applicable
Law.  This Agreement shall be interpreted and construed in
accordance with the laws of the State of Illinois, without regard to its choice
of law principles.

     

    9.18           Survival of Executive’s
Rights.  All of Executive’s post-termination rights hereunder,
including Executive’s rights to compensation and benefits under Article VI of
this Agreement, and his post-termination obligations, including but not limited
to his obligations under Article VII (Covenants) and Article IX (Miscellaneous),
shall survive the termination of Executive’s employment and the termination of
this Agreement.

     

    IN
WITNESS WHEREOF, the parties have executed this Agreement on the date set forth
below.

     

    
      
        
          
            
              	
                      AMCOL
      INTERNATIONAL CORPORATION

                    
	 
      
	By:
      /s/
      James W. Ashley
	Its:
      Secretary
	
                      Date:

                    	
                      February
      2, 2009

                    
	 
      
	
                      EXECUTIVE

                    
	 
      	 
      
	
                      /s/ Gary L. Castagna

                    
	
                      Date:  February
      2, 2009

                    

            

          

        

      

    

    
      
         

      

      
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    Exhibit
A

     

    Named
Executives

     

    Gary L.
Castagna

     

    Ryan F.
McKendrick

     

    Donald W.
Pearson

     

    Lawrence
E. Washow

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    Exhibit
B

     

    FORM OF
EMPLOYMENT

    SEPARATION AGREEMENT AND
MUTUAL RELEASE

     

    AMCOL International Corporation
(“Employer”) and [Executive’s Name] (“Executive”) hereby agree as
follows:

     

    1.           Executive’s
employment with Employer terminated on ______________ (“the Termination
Date”).

     

    2.           Employer
denies that it is liable to Executive for any reason whatsoever, and the entry
into this Separation Agreement and Release shall not constitute any admission or
evidence of unlawful discrimination or improper conduct, and should not be
construed as an admission of fault, wrongdoing, or
liability.  However, in consideration of the mutual promises herein,
Employer will provide Executive with the following:

     

    [INSERT
AMOUNTS TO BE PAID]

     

    Executive
acknowledges that he has received good and valuable consideration for the
promises herein.  Payment will be made as set forth in Executive’s
Employment Agreement.

     

    3.           Except
as set forth in this Agreement, no further payments will be made
to  Executive for wages, salary, bonus, expense reimbursement,
commissions, consulting, benefits, severance, vacation, personal days, sick pay,
disability pay or otherwise.

    
      
         

      

      
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    4.           Executive
releases, forever discharges and covenants not to sue Employer or its current or
former parent companies, subsidiaries, affiliates, predecessors, successors,
insurers, directors, officers, employees, agents, or assigns, with respect to
any and all claims, causes of action, suits, debts, sums of money,
controversies, agreements, promises, damages, and demands whatsoever, including
attorneys’ fees and court costs, in law or equity or before any federal, state
or local administrative agency, whether known or unknown, suspected or
unsuspected, which  Executive has, had, or may have, based on any
event occurring, or alleged to have occurred, to the date of this
Agreement.  This release includes, but is not limited to, claims under
Title VII of the Civil Rights Act of 1964, as amended, the Americans with
Disabilities Act, the Rehabilitation Act, the Age Discrimination in Employment
Act, the Employee Retirement Income Security Act, the Family and Medical Leave
Act and any federal, state or local statute, law, regulation, ordinance, or
order, and claims arising under common law, contract, implied contract, public
policy or tort.  To the extent any such claim cannot be waived as a
matter of law, it is understood that  Executive reserves the right to
file such claim, but Executive expressly waives his right to any relief of any
kind should any person or entity pursue any claim on Executive’s
behalf.  Notwithstanding the foregoing release of all claims, it is
understood and agreed that Executive’s claims for unemployment compensation, if
any, are not released.

     

    5.           Executive
expressly waives and relinquishes all rights and benefits provided to him by any
statute or other law which prohibits release of unspecified claims and
acknowledge that this release is intended to include all claims he has or may
have, whether he is aware of them or not, and that all such claims are released
by this Agreement.

     

    6.           Executive
shall not disclose any proprietary, trade secret or other confidential business
information learned solely by reason of  Executive’s employment with
Employer.  Executive agrees that the post-termination obligations of
his Employment Agreement with AMCOL International Corporation will remain in
full force and effect.

     

    7.           Executive
agrees to cooperate with Employer in regard to the transition of business
matters handled by Executive during his employment with Employer and in regard
to any litigation brought by or against Employer.

    
      
         

      

      
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    8.           This
Agreement is strictly confidential and Executive will not inform any person of
any of its terms and conditions or the amount of severance provided herein,
except for  Executive’s attorney, members of his immediate family and
those who need to know for  Executive’s compliance with federal,
state, or local law.  Executive will instruct any persons advised
about this Agreement pursuant to this provision to keep such information
strictly confidential.

     

    9.           Executive
will not make statements about Employer or engage in conduct which could
reasonably be expected to adversely affect Employer’s reputation or
business.

     

    10.         Executive
understands that this Agreement fully sets forth all separation benefits he will
receive from Employer, and it supersedes any offers or promises, whether oral or
written, which may have been made at any time.

     

    11.         This
Agreement will not take effect until eight days after Executive signs
it.

     

    12.         Executive
may revoke this Agreement within seven days after signing it and render it null
and void.  If  Executive wishes to revoke this Agreement, he
should notify ____________________________, in writing at
_________________________ of Executive’s intent to revoke within seven days
after signing this Agreement.

     

    13.         Executive
acknowledges that he has fully read this Agreement, understands its terms, has
been advised to consult with an attorney prior to signing this Agreement, has
been given 45 days to consider this release and its ramifications, has been
given seven days after signing to rescind this Agreement, and is entering into
this Agreement knowingly and voluntarily.  Executive further agrees
that any modification of this Agreement, whether material or not, will not
restart or change the original 45-day consideration period.

    
      
         

      

      
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      	THIS
      DOCUMENT IS A RELEASE OF ALL CLAIMS - READ CAREFULLY BEFORE
    SIGNING
	 	 	 
	
                                          DATED:  ___________

                                        	 
      
	 
      	Executive
	 
      	 
      	 
      
	 
      	
                                          AMCOL
      INTERNATIONAL 

                                          CORPORATION

                                        
	 
      	 
      	 
      
	
                                          DATED:
      __________

                                        	
                                          By:

                                        	 
      
	 	 	 
	 
      	
                                          Its 

                                        	 
      

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        25EMPLOYMENT
AGREEMENT

     

    This
EMPLOYMENT AGREEMENT (the “Agreement”) is effective as of March 25, 2009 (the
“Effective Date”), by and between AMCOL International Corporation, a Delaware
corporation (the “Company”), and

      Ryan F.
McKendrick (“Executive”).

    

     

    The Board
of Directors of the Company (the “Board”), has determined that it is in the best
interests of the Company and its stockholders to assure that the Company will
have the continued dedication of the Executive, notwithstanding the possibility,
threat or occurrence of a Change of Control (as defined herein).  The
Board believes it is imperative to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks created by a pending
or threatened Change of Control and to encourage the Executive’s full attention
and dedication to the Company in the event of any threatened or pending Change
of Control, and to provide the Executive with compensation and benefits
arrangements upon a Change of Control that ensure that the compensation and
benefits expectations of the Executive will be satisfied and that provide the
Executive with compensation and benefits arrangements that are competitive with
those of other corporations. In addition, the Board believes it is necessary to
provide a severance package that assures that the Company is able to attract and
retain the highest quality executive talent and to ensure that the
post-employment non-compete and non-solicitation restrictions are
enforceable.  Therefore, in order to accomplish these objectives, the
Board has caused the Company to enter into this Agreement.

     

    NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

     

    Article
I — DEFINITIONS

     

    The terms
set forth below have the following meanings:

     

    1.1           “Accrued
Annual Bonus” means the amount of any Annual Bonus earned but not yet paid with
respect to any fiscal year ended prior to the Date of Termination.

     

    1.2           “Accrued
Base Salary” means the amount of Executive’s Base Salary which is accrued but
not yet paid as of the Date of Termination.

     

    1.3           “Affiliate”
means any Person that directly or indirectly controls, is controlled by, or is
under common control with, the applicable Person.  For the purposes of
this definition, the term “control” when used with respect to any Person means
the power to direct or cause the direction of management or policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.

     

    1.4           “Anniversary
Date” means any annual anniversary of the Effective Date.

     

    1.5           “Annual
Bonus” - see Section 4.2.

     

    1.6           “Beneficial
Owner” means such term as defined in Rule 13d-3 (or any successor rule) under
the Exchange Act.

    
      
         

      

      
        
        

        
          

        

      

      
         

      

    

    1.7           “Cause”
means any of the following:

     

    (a)           Executive’s
commission of a felony or misdemeanor that involves fraud, dishonesty or moral
turpitude,

     

    (b)           Executive’s
willful or intentional material breach of this Agreement, or any material breach
of this Agreement that is not corrected within thirty (30) days of notice from
the Company,

     

    (c)           willful
or intentional material misconduct by Executive in the performance of his duties
under this Agreement,

     

    (d)           Executive
performs his duties in a manner that is grossly negligent, or

     

    (e)           Executive
fails to cooperate in any governmental investigations or
proceedings.

     

    For
purposes of clauses (b), (c), (d) and (e) of the preceding sentence, Cause shall
not include bad judgment or negligence which results from the Executive’s good
faith efforts to perform his duties.

     

    1.8           “Change
of Control” means the occurrence of any one or more of the
following:

     

    (a)           any
person (as such term is used in Rule 13d-5 under the Exchange Act) or group (as
such term is defined in Section 3(a)(9) and 13(d)(3) of the Exchange Act), other
than a Subsidiary, any employee benefit plan (or any related trust) of the
Company or any of its Subsidiaries or any Excluded Person, becomes the
Beneficial Owner of 50.1% or more of the outstanding common stock of the Company
or of Voting Securities representing 50.1% or more of the combined voting power
of the then outstanding voting securities of the Company (such a person or
group, a “Majority Owner”), except that (i) no Change of Control shall be deemed
to have occurred solely by reason of such beneficial ownership by a corporation
with respect to which both more than 49.9% of the common stock of such
corporation and Voting Securities representing more than 49.9% of the aggregate
voting power of such corporation are then owned, directly or indirectly, by the
persons who were the direct or indirect owners of the common stock and Voting
Securities of the Company immediately before such acquisition in substantially
the same proportions as their ownership, immediately before such acquisition, of
the common stock and Voting Securities of the Company, as the case may be and
(ii) such corporation shall not be deemed a Majority Owner; or

     

    (b)           the
Incumbent Directors (determined using the Effective Date as the baseline date)
cease for any reason to constitute at least one-half of the directors of the
Company then serving; or

    
      
         

      

      
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    (c)           the
consummation by the Company of a merger, reorganization, consolidation, or
similar transaction, or sale or other disposition of 50.1% of the consolidated
assets of the Company (any of the foregoing transactions, a “Reorganization
Transaction”) which is not an Exempt Reorganization Transaction.

     

    Notwithstanding
the occurrence of any of the foregoing events, a Change of Control shall not
occur with respect to Executive if, in advance of such event, the Executive
agrees in writing that such event shall not constitute a Change of
Control.

     

    1.9           “Code”
means the Internal Revenue Code of 1986, as amended from time to
time.

     

    1.10         “Compensation
Committee” means the Compensation Committee of the Board of Directors of the
Company.

     

    1.11         “Conflicting
Organization” means any person or entity which is engaged in or about to become
engaged in, research, development, production, manufacturing, importation,
marketing, licensing, selling, or servicing of a Conflicting
Product.

     

    1.12           “Conflicting
Product” means any product, process, system or service of any person or
organization other than the Company or an Affiliate, in existence or under
development, which is the same as or similar to or competes with a product,
process, system or service upon which Executive works or has worked during the
three year period ending on his Date of Termination, or about which Executive
acquired or acquires Confidential Information.

     

    1.13         “Date
of Termination” means the date of the receipt of the Notice of Termination by
Executive (if such Notice is given by the Company) or by the Company (if such
Notice is given by Executive), or any later date, not more than 15 days after
the giving of such Notice, specified in such notice; provided, however,
that:

     

    (a)           if
Executive’s employment is terminated by reason of death, the Date of Termination
shall be the date of Executive’s death; and

     

    (b)           if
Executive’s employment is terminated by reason of Disability, the Date of
Termination shall be the 30th day after Executive’s receipt of the physician’s
certification of Disability, unless, before such date, Executive shall have
resumed the full-time performance of Executive’s duties; and

     

    (c)           if
Executive terminates his employment without Good Reason, the Date of Termination
shall be determined by the Company, provided that it will not be later than the
90th day after the giving of such Notice; and

     

    (d)           if
no Notice of Termination is given, the Date of Termination shall be the last
date on which Executive is employed by the Company.

    
      
         

      

      
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    1.14         “Disability”
means (i) the Executive has a physical or mental condition which renders
Executive unable to engage in any substantial gainful activity by reason of any
medically determinable physical or mental impairment which can be expected to
result in death or can be expected to last for a continuous period of not less
than 12 months, or (ii) by reason of any medically determinable physical or
mental impairment which can be expected to result in death or can be expected to
last for a continuous period of not less than 12 months, the Executive is
receiving income replacement benefits for a period of not less than three months
under an accident and health plan covering the Executive that is sponsored by
the Company.

     

    1.15         “Employment
Period” - see Section 3.1.

     

    1.16           “Exchange
Act” means the Securities Exchange Act of 1934, as amended.

     

    1.17           “Excluded
Person” means any of the Paul Bechtner Trust, Everett P. Weaver, any Named
Executive, any Affiliates or Family Member of any of the foregoing and any group
(as such term is defined in Section 3(a)(9) and 13(d)(3) of the Exchange Act) of
which any of the foregoing is a member.

     

    1.18           “Executive
Termination” means a Termination of Employment by Executive for any reason
including Good Reason or no reason during the 30-day period commencing twelve
months after a Change of Control.

     

    1.19         “Exempt
Reorganization Transaction” means a Reorganization Transaction which results (i)
in the Persons who were the direct or indirect owners of the outstanding common
stock and Voting Securities of the Company immediately before such
Reorganization Transaction becoming, immediately after the consummation of such
Reorganization Transaction, the direct or indirect owners of both more than
49.9% of the then-outstanding common stock of the Surviving Corporation and
Voting Securities representing more than 49.9% of the aggregate voting power of
the Surviving Corporation, in substantially the same respective proportions as
such Persons’ ownership of the common stock and Voting Securities of the Company
immediately before such Reorganization Transaction; (ii) in the Excluded Person
owning 50% or more of the common stock of the Surviving Corporation or Voting
Securities representing 50% or more of the combined voting power of the
Surviving Corporation; or (iii) from a transaction of any kind (including,
without limitation, a merger, reorganization, consolidation or similar
transaction or a plan or agreement for sale or other disposition of assets of
the Company or a plan of liquidation of the Company) pursuant to the Bankruptcy
Code of Title 11 of the United States Code, as amended from time to time, or any
similar or successor statute, domestic or foreign.

     

    1.20         “Family
Member” means, with respect to the applicable Person, a spouse, ancestor, lineal
descendant, or spouse of a lineal descendant, including without limitation
descendants by adoption.

     

    1.21         “Good
Reason” means the occurrence of any one of the following events unless Executive
specifically agrees in writing that such event shall not be Good
Reason:

     

    (a)           any
material breach of the Agreement by the Company, including without limitation,
Section 2.1, provided, however, that no breach of this Agreement shall
constitute Good Reason unless Executive gives the Company written notice of such
breach and the Company fails to cure such breach within 30
days;

    
      
         

      

      
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    (b)           the
failure of either the Company to assign this Agreement to a successor of the
Company or failure of a successor of the Company to expressly assume and agree
to be bound by the Agreement; or

     

    (c)           the
assignment to the Executive of any duties inconsistent in any respect with the
Executive’s position, authority, duties or responsibilities as contemplated by
this Agreement, or any action by the Company that results in a material
reduction in the nature or scope of Executive’s position, authority, duties or
responsibilities, excluding for this purpose an isolated, insubstantial and
inadvertent action not taken in bad faith and that is remedied by the Company
promptly after receipt of notice thereof given by the Executive.

     

    In the
event of an occurrence or omission constituting Good Reason as described in
subsections (a), (b) and (c) above, Executive shall provide notice to the Board
of any such reduction, change or breach upon which Executive intends to rely as
the basis for Good Reason within 30 days of the occurrence of such reduction,
change or breach.  The Company shall have 30 days following the
receipt of such notice to remedy the condition constituting such reduction,
change or breach and, if so remedied, any termination of Executive’s employment
hereunder on the basis of the circumstances described in such notice shall be
considered a voluntary termination of employment.  If the Company does
not remedy the condition that has been the subject of a notice as described in
this Section within 30 days of the Company’s receipt of such notice, Executive
must terminate his employment within 90 days following the occurrence of such
condition in order for such termination to be considered due to Good Reason for
purposes of this Agreement.

     

    1.22        
“Imminent Control Change Date” means any date on which occurs (i) a presentation
to the Company’s stockholders generally or any of the Company’s directors or
executive officers of a proposal or offer for a Change of Control, (ii) the
public announcement (whether by advertisement, press release, press interview,
public statement, SEC filing or otherwise) of a proposal or offer for a Change
of Control, and (iii) such proposal or offer remains effective and
unrevoked.

     

    1.23         “Incumbent
Directors” means, as of the date of this Agreement, individuals then serving as
members of the Board; provided that any subsequently-appointed or elected member
of the Board whose election, or nomination for election by stockholders of the
Company or the Surviving Corporation, as applicable, was approved by a vote or
written consent of at least one-half of the directors then comprising the
Incumbent Directors shall also thereafter be considered an Incumbent Director,
unless the initial assumption of office of such subsequently-elected or
appointed director was in connection with (i) an actual or threatened election
contest, including a consent solicitation, relating to the election or removal
of one or more members of the Board, (ii) a “tender offer” (as such term is used
in Section 14(d) of the Exchange Act), (iii) a proposed Reorganization
Transaction, or (iv) a request, nomination or suggestion of any Beneficial Owner
of Voting Securities representing 35% or more of the aggregate voting power of
the Voting Securities of the Company or the Surviving Corporation, as
applicable.

    
      
         

      

      
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    1.24         “Named
Executive” means any individual listed on Exhibit A except to the extent the
individual had a termination of employment not less than 120 days prior to the
applicable event potentially constituting a Change of Control and any other
employee or officer of the Company designated by the Board and who is a party to
an agreement substantially in the same form as this Agreement (with variation in
the amount of compensation and benefits payable under the agreement) and entered
into by the employee or officer not less than 120 days prior to the applicable
event potentially constituting a Change of Control.

     

    1.25         “Notice
of Termination” means a written notice given in accordance with Section 9.11
which sets forth (a) the specific termination provision in this Agreement relied
upon by the party giving such notice, (b) in reasonable detail the specific
facts and circumstances claimed to provide a basis for such Termination of
Employment, and (c) if the Date of Termination is other than the date of receipt
of such Notice of Termination, the Date of Termination.

     

    1.26         “Person”
means any individual, sole proprietorship, partnership, joint venture, limited
liability company, trust, unincorporated organization, corporation, institution,
public benefit corporation, entity or government instrumentality, division,
agency, body or department.

     

    1.27         “Prorata
Annual Bonus” means the portion of the Annual Bonus payable to Executive as
calculated on a pro rata basis, based on performance to date and on the number
of days which have elapsed in such fiscal year through the Date of
Termination.

     

    1.28         “Subsidiary”
means, with respect to any Person, (a) any corporation of which more than 50% of
the Voting Securities are at the time, directly or indirectly, owned by such
Person, and (b) any partnership or limited liability company in which such
Person has a direct or indirect interest (whether in the form of voting or
participation in profits or capital contribution) of more than 50%.

     

    1.29         “Surviving
Corporation” means the corporation resulting from a Reorganization Transaction
or, if securities representing more than 50% of the aggregate Voting Power of
such resulting corporation are directly or indirectly owned by another
corporation, such other corporation.

     

    1.30         “Target
Annual Bonus” - see Section 4.2.

     

    1.31  
      “Target Annual Goals” - see Section
4.2.

     

    1.32         “Taxes”
means the incremental federal, state, local and foreign income, employment,
excise and other taxes payable by Executive with respect to any applicable item
of income.

     

    1.33         “Termination
For Good Reason” means a Termination of Employment by Executive for a Good
Reason.

    
      
         

      

      
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    1.34         “Termination
of Employment” means a termination by the Company or Executive of Executive’s
employment.

     

    1.35         “Termination
Without Cause” means a Termination of Employment by the Company for any reason
other than Cause or Executive’s death or Disability.

     

    1.36         “Voting
Securities” of a corporation means securities of such corporation that are
entitled to vote generally in the election of directors of such corporation, but
not including any other class of securities of such corporation that may have
voting power by reason of the occurrence of a contingency.

     

    Article
II —
DUTIES

     

    2.1           Duties.  During
the Employment Period, (A) the Executive’s position (including status, offices,
titles and reporting requirements), authority, duties and responsibilities shall
be at least commensurate in all material respects with the most significant of
those held, exercised and assigned at any time during the 90-day period
immediately preceding the Effective Date and, (B) following any Change of
Control, the Executive’s services shall be performed at the office where the
Executive was employed immediately preceding the effective date of the Change of
Control, or at any other location less than 50 miles from such
office.  Executive shall devote all of his business time, attention
and effort during normal business hours, excluding any periods of disability,
vacation, or sick leave to which Executive is entitled, to the affairs of the
Company and shall use his best efforts to promote the interests of the
Company.

     

    2.2           Other
Activities.  Executive may serve on civic or charitable boards
or committees, deliver lectures, fulfill speaking engagements or teach at
educational institutions, and manage personal investments; provided that such
activities do not significantly interfere with the performance of Executive’s
duties under this Agreement.  Executive may serve on corporate boards
or committees with the prior written consent of the Board.

     

    Article III —
EMPLOYMENT PERIOD

     

    Subject
to the termination provisions provided herein, the term of Executive’s
employment under this Agreement (the “Employment Period”) shall begin on the
Effective Date and end on the second annual Anniversary Date or, such later date
to which the Employment Period is extended pursuant to the following
sentence.  On the date which is twenty-one months after the Effective
Date and thereafter, the Employment Period (assuming that an Expiration Notice
to the effect that the Agreement shall expire on the second annual Anniversary
Date has not been delivered by the Executive or Company to the other prior to
such date) shall be automatically extended each day by one day to create a new
three-month term until, at any time after the date which is twenty-one months
after the Effective Date the Company delivers written notice (an “Expiration
Notice”) to Executive or Executive delivers an Expiration Notice to the Company,
in either case, to the effect that the Agreement shall expire on a date
specified in the Expiration Notice (the “Expiration Date”) that is not less than
three months after the date the Expiration Notice is delivered to the Company or
the Executive, respectively.  The employment of Executive by the
Company shall not be terminated other than in accordance with Article
VI.

    
      
         

      

      
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    Article IV —
COMPENSATION

     

    4.1           Salary.  Subject
to Section 4.3 hereof, during the Employment Period, the Company shall pay or
cause to be paid to Executive in accordance with its normal payroll practices
(but not less frequently than monthly) an annual salary at a rate of $315,000
per year (“Base Salary”).  During the Employment Period, the Base
Salary shall be reviewed at least annually and may be increased from time to
time as shall be determined by the Compensation Committee.  After any
such increase, the term “Base Salary” shall thereafter refer to the increased
amount.  Any increase in Base Salary shall not limit or reduce any
other obligation of the Company to Executive under this
Agreement.  Base Salary shall not be reduced at any time without the
express written consent of Executive.

     

    4.2           Annual
Bonus.

     

    (a)           Subject
to Section 4.3 hereof, the Company shall pay or cause to be paid to Executive an
annual cash bonus (“Annual Bonus”) in accordance with the terms of the AMCOL
International Corporation 2006 Annual Cash Incentive Plan and the terms hereof
for each fiscal year which begins or ends during the Employment
Period.  Executive shall be eligible for an Annual Bonus based upon
target performance goals (the “Target Annual Goals”), as determined by the
Compensation Committee for a payment of at least 60% of Executive’s Base Salary
(“Target Annual Bonus”) upon the Executive’s achievement of the Target Annual
Goals.  The Target Annual Goals shall be set as described above no
later than February 28 of each fiscal year.

     

    (b)           Subject
to Section 4.3 hereof, the Company shall pay or cause to be paid the entire
Annual Bonus that is payable with respect to a fiscal year in cash after the
Compensation Committee has certified (i) whether and the degree to which Target
Annual Goals have been achieved, and (ii) the amount of the Annual Bonus, which
shall occur as soon as practicable following the close of such fiscal
year.  Any such Annual Bonus shall in any event be paid no later than
February 28 of each fiscal year.

     

    4.3           Deferral.  In
the event that all or any portion of a payment to be made to Executive pursuant
to Section 4.1 or 4.2 hereof or any equity compensation award shall be
ineligible for treatment as “qualified performance - based compensation” under
Section 162(m) of the Code, the Company, in its sole discretion, shall have the
right to defer payment to Executive of all or any portion of any such payment
until such time as such amounts are deductible by the Company under Section
162(m) of the Code; provided that such deferral shall be limited to the portion
of the payment that is not deductible by the Company pursuant to the
Code.

    
      
         

      

      
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    Article V — OTHER
BENEFITS

     

    5.1           Stock Option, Restricted
Stock and Other Equity Incentive Plans.  In addition to Base
Salary and an Annual Bonus, Executive shall be eligible to participate during
the Employment Period in all stock option, restricted stock and other equity
incentive plans, practices, policies and programs of the Company, in accordance
with their terms as in effect from time to time. If a Change of Control occurs
during the Employment Period, all outstanding stock options, restricted stock
and other equity compensation granted to Executive (whether before, on or after
the Effective Date) shall become fully vested and exercisable, except as
otherwise provided with respect to an award intended to qualify as
performance-based compensation under Section 162(m) of the Code.

     

    5.2           Incentive, Savings and
Retirement Plans.  In addition to Base Salary, Annual Bonus,
and equity awards, Executive shall be entitled to participate during the
Employment Period in all incentives, savings and retirement plans, practices,
policies and programs that are from time to time applicable to other comparable
senior executives of the Company, including any supplemental executive
retirement plan, in accordance with their terms as in effect from time to
time.

     

    5.3           Welfare
Benefits.  During the Employment Period, Executive and his
family shall be eligible to participate in, and shall receive all benefits
under, welfare benefit plans, practices, policies and programs provided by the
Company (including medical, prescription, dental, disability, employee life,
group life, dependent life, accidental death and travel accident insurance plans
and programs) applicable to other comparable senior executives of the Company,
in accordance with their terms as in effect from time to time.

     

    5.4           Fringe
Benefits.  During the Employment Period, Executive shall be
entitled to fringe benefits applicable to other comparable senior executive of
the Company, in accordance with their terms as in effect from time to
time.

     

    5.5           Vacation.  During
the Employment Period, Executive shall be entitled to paid vacation time in
accordance with the plans, practices, policies, and programs applicable to other
comparable senior executives of the Company, in accordance with their terms as
in effect from time to time, but in no event shall such vacation time be less
than four weeks per calendar year.

     

    5.6           Expenses.  During
the Employment Period, Executive shall be entitled to receive prompt
reimbursement for all reasonable employment-related expenses incurred by
Executive upon the receipt by the Company of an accounting in accordance with
practices, policies, and procedures applicable to comparable senior executives
of the Company, in accordance with their terms as in effect from time to
time.

     

    Article VI —
TERMINATION BENEFITS

     

    6.1           Termination for Cause or
Other than for Good Reason, etc.  If the Company terminates
Executive’s employment for Cause (whether before or after a Change of Control)
or Executive terminates his employment other than for Good Reason, death or
Disability, or Executive Termination, the Company shall pay to Executive
immediately after the Date of Termination an amount equal to the sum of
Executive’s Accrued Base Salary and Accrued Annual Bonus and Executive shall not
be entitled to receive any severance payment.

    
      
         

      

      
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    6.2           Termination for Death or
Disability Prior to Change of Control or More than Thirteen Months after a
Change of Control.  If Executive’s employment terminates due to
his death or Disability prior to a Change of Control or more than thirteen
months after a Change of Control, the Company shall pay to Executive or his
beneficiaries, as the case may be, (i) immediately after the Date of Termination
an amount which is equal to the sum of Executive’s Accrued Base Salary and
Accrued Annual Bonus, and (ii) at the time described in Section 4.2(b), an
amount which is equal to the Executive’s Prorata Annual Bonus.

     

    6.3           Termination Without Cause or
for Good Reason Prior to Change of Control or More than Thirteen Months After a
Change of Control.  In the event of a Termination Without Cause
or a Termination for Good Reason prior to a Change of Control or more than
thirteen (13) months after a Change of Control, Executive shall receive the
following:

     

    (a)           immediately
after the Date of Termination, a lump sum amount in immediately available funds
equal to the sum of Executive’s Accrued Base Salary and Accrued Annual
Bonus;

     

    (b)           at
the time described in Section 4.2(b), an amount which is equal to the
Executive’s Prorata Annual Bonus;

     

    (c)           Base
Salary payable on the same basis as in effect immediately prior to the Date of
Termination for eighteen (18) months following the Executive’s Date of
Termination, provided that if the Date of Termination occurs between September
15th and December 31st, the Executive will be paid on the same basis as in
effect immediately prior to the Date of Termination for the period through March
14th of the following year, at which time all payments will be suspended until
the day after the six-month anniversary of the Date of Termination (the
“Suspension Period”), at which time all payments suspended during the Suspension
Period will be paid in a lump sum and the normal payment schedule will
resume.  Each of these payments shall be a separate payment for
purposes of Section 409A of the Code;

     

    (d)           other
than in the event of death, the Executive and his dependents will continue to be
eligible for coverage, at the Company’s cost and expense, under the Company’s
group health, dental and prescription group plans for a period commencing on the
Executive’s Date of Termination and ending on the earlier of (i) 18 months after
the Executive’s Date of Termination and (ii) the date on which the Executive
accepts a position with another employer. The Executive acknowledges that under
the Code, these amounts will be treated as imputed income to him for income tax
purposes; and

     

    (e)           if
the Executive’s group health, dental and prescription coverage continues for 18
months under subsection (d) above, then following the expiration of the 18-month
period, the Executive and his dependents will continue to be eligible for
coverage, at the Executive’s cost and expense, under the Company’s group health,
dental and prescription group plans until the earliest of (i) the Executive's
eligibility for Medicare benefits, (ii) the date on which the Executive accepts
a position with another employer; or (iii) the date the Executive ceases paying
for such coverage.

    
      
         

      

      
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    Notwithstanding
any provisions of this Section 6.3 to the contrary, if Executive breaches any or
all of the provisions of Sections 7.1 and 7.2, the payment of the Prorata Annual
Bonus pursuant to Section 6.3(b), any payments due under Sections 6.3(c) and the
continuation or eligibility for benefits under Section 6.3(d) or (e) shall cease
immediately upon such breach.  In addition to the foregoing, and to
protect and compensate the Company in the event of such breach by the Executive,
the Company shall be entitled to any and all remedies at law and equitable
relief as described in Section 7.3.

     

    6.4           Termination After Change of
Control.  In the event of a Termination Without Cause or a
Termination for Good Reason within thirteen (13) months after a Change In
Control, or Termination of Employment due to death or Disability within thirteen
(13) months following a Change of Control, or an Executive Termination after a
Change In Control, the Executive shall receive the following:

     

    (a)           immediately
after the Date of Termination, a lump sum amount in immediately available funds
equal to the sum of Executive’s Accrued Base Salary, Accrued Annual Bonus and
Prorata Annual Bonus; 

     

    (b)           six-months
and one day following his Date of Termination, a lump sum amount in immediately
available funds equal to three (3) times the sum of (i) the Executive’s Base
Salary and (ii) the greater of the following amounts:  (x) 60% of
Executives Base Salary for the fiscal year during which the Date of Termination
occurs and (y) the average of the Annual Bonuses paid or payable to Executive
for the three most recent fiscal years ended on or before such date;
and

     

    (c)           other
than in the event of death, the Executive and his dependents will continue to be
eligible for coverage, at the Company’s cost and expense, under the Company’s
group health, dental and prescription group plans for a period commencing on the
Executive's Date of Termination and ending on the earlier of (i) 36 months after
the Executive's Date of Termination and (ii) the date on which the Executive
accepts a position with another employer.  The Executive acknowledges
that under the Code, these amounts will be treated as imputed income to him for
income tax purposes.

     

    (d)           if
the Executive’s group health, dental and prescription coverage continues for 36
months under subsection (c) above, then following the expiration of the 36-month
period, the Executive and his dependents will continue to be eligible for
coverage, at the Executive’s cost and expense, under the Company’s group health,
dental and prescription group plans until the earliest of (i) the Executive's
eligibility for Medicare benefits, (ii) the date on which the Executive accepts
a position with another employer; or (iii) the date the Executive ceases paying
for such coverage.

    
      
         

      

      
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    Notwithstanding
any provisions of this Section 6.4 to the contrary, if Executive breaches any or
all of the provisions of Sections 7.1 and 7.2, the continuation of payments and
benefits pursuant to this Section 6.4 shall cease upon such breach and, to
prevent the Executive’s unjust enrichment, the Executive shall immediately pay
the Company an amount equal to (i) the amount that the Executive received from
the Company pursuant to this Section 6.4, multiplied by (ii) a fraction of which
the numerator is the number of days remaining from the date of the breach
through the first anniversary of the Executive’s Termination of Employment and
the denominator of which is 365.  In addition to the foregoing, and to
protect and compensate the Company in the event of such breach by the Executive,
the Company shall be entitled to any and all remedies at law and equitable
relief as described in Section 7.3.

     

    6.5           Imminent Control
Change.  If an Imminent Control Change Date occurs on or within
30 days after the date on which the Company delivers a Notice of Termination to
Executive terminating Executive’s employment not for Cause and if a Change of
Control occurs within twelve months after delivery of the Notice, the
Executive’s Termination of Employment pursuant to the Notice shall be deemed a
Termination of Employment Without Cause on or after a Change of Control and the
Executive’s rights and obligations shall be determined under Section 6.4 rather
than Section 6.3.  Any payments or benefits to be received by the
Executive pursuant to Section 6.4 shall be reduced by any payments or benefits
made or provided pursuant to Section 6.3.  If an Imminent Control
Change Date occurs on or within 30 days after the date on which the Executive
has a Termination of Employment due to death or Disability and if a Change of
Control occurs within twelve months after death or Disability, the Executive’s
Termination of Employment due to death or Disability shall be deemed a
Termination of Employment due to death or Disability on or after a Change of
Control and the Executive’s beneficiaries’ rights and obligations shall be under
Section 6.4 rather than Section 6.2.  Any payments or benefits to be
received by the Executive’s Beneficiaries pursuant to Section 6.4 shall be
reduced by any payments or benefits made or provided pursuant to Section
6.2.

     

    6.6           Other
Rights.  Except as specifically provided herein, this Agreement
shall not prevent or limit Executive’s continuing or future participation in any
benefit, bonus, incentive or other plan, program or policy provided by the
Company and for which Executive may qualify, nor shall this Agreement limit or
otherwise affect such rights Executive may have under any other agreements with
the Company.  Amounts which are vested benefits or which Executive is
otherwise entitled to receive under any plan, program or policy and any other
payment or benefit required by law at or after the Date of Termination shall be
payable in accordance with such plan, program or policy or applicable law except
as expressly modified by this Agreement.

     

    6.7           Termination
Rights.  Executive recognizes and agrees that the Company has
the right to terminate his employment for any reason or no reason and that upon
such termination the Executive’s sole right is to receive compensation and
benefits in accordance with the terms of this Agreement.

    
      
         

      

      
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    Article VII —
COVENANTS

     

    7.1           Non-Disclosure and
Non-Solicitation.  Executive acknowledges that the successful
marketing and development of the Company’s products requires substantial time
and expense.  Such efforts utilize and generate valuable confidential
and proprietary information, of which Executive will obtain knowledge during the
course of his employment with the Company.  As used herein,
“Confidential Information” means any information of the Company that the Company
considers to be proprietary and treats as confidential or information of any
third party that the Company is under an obligation to keep confidential,
including but not limited to the following: (i) trade secrets, confidential
knowledge, data or other proprietary information relating to products,
processes, know-how, designs, formulas, developmental or experimental work, (ii)
employment status, salaries and other personnel information, decisions to offer
employment, pre-employment testing and screening results, citizenship status,
disability status, performance issues, executive evaluations, medical problems
of executives and executives’ families, garnishments and levies against wages,
contents of employment agreements, statements regarding the financial condition
of the Company or any subsidiary or affiliated entity, payments made to or
expenses incurred by the Company or any of its executives, shareholders or
directors, discounts given by the Company, vendors and other parties, minutes of
Board meetings of the Company or any subsidiary or affiliated entities, contents
of contracts, legal matters by or against the Company or any subsidiary or
affiliated entities, business strategies, plans, proposals, names of customers
and potential customers; and (iii) other information or materials of the Company
marked or noticed by the Company as being confidential, whether constituting a
trade secret or not, and whether proprietary or not, which are of value to the
Company.  For purposes of this Agreement, Confidential Information
includes the foregoing and other information protected under the Illinois Trade
Secrets Act.  Confidential Information does not include: (i)
information that at the time of disclosure is in the public domain through no
fault of Executive; (ii) information received from a third party outside of the
Company that was disclosed without a breach of any confidentiality obligation;
(iii) information approved for public release by written authorization of the
Company; or (iv) information that is required by law or an order of any court,
agency or proceeding to be disclosed.  Executive acknowledges and
agrees that the Company shall retain exclusive ownership of all right, title,
and interest in the Confidential Information, including any and all worldwide
copyrights, trade secrets, patent, and confidential and proprietary information
rights.  Executive agrees to undertake the following obligations,
which Executive acknowledges to be reasonably designed to protect the Company’s
legitimate business interests without unnecessarily or unreasonably restricting
Executive’s post-employment opportunities:

     

    (a)           Executive
agrees that he will not at any time, whether during or after the cessation of
his employment, reveal or permit any other person or entity to reveal, any of
the Confidential Information to any person or any entity, except, and only to
the extent, as may be required in the ordinary course of performing Executive’s
assigned duties as an Executive of the Company, and Executive agrees to keep
secret, and take all necessary precautions against disclosure of, all
Confidential Information and all matters entrusted to him and not to use or
attempt to use any Confidential Information in any manner that may cause injury
or loss, or may be calculated to cause injury or loss, whether directly or
indirectly, to the Company or its customers;

     

    (b)           Executive
agrees that during and after his employment he shall not remove, copy, duplicate
or otherwise reproduce, use or permit to be used any notes, memoranda, reports,
lists, records, drawings, sketches, specifications, software programs, data,
documentation or other materials of any nature relating to any matter within the
scope of the business of the Company or concerning any of its dealings or
affairs except as required to perform Executive’s duties for the
Company;

    
      
         

      

      
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    (c)           Upon
cessation of his employment relationship with the Company, Executive shall
immediately deliver to the Company all Confidential Information and other
materials relating to the Company in his possession or delivered to him by the
Company, including computer programs, files, notes, records, memoranda, reports,
lists, drawings, sketches, specifications, data, charts, and other documents,
materials and things (“Materials”), whether or not containing Confidential
Information, whether or not prepared by Executive, it being agreed that all
Materials shall be and remain the sole and exclusive property of the
Company;

     

    (d)           Without
limiting the obligations of Section 7.1(c), Executive agrees that while
Executive is employed by the Company prior to his Date of Termination and for a
period of one year following his Date of Termination he will not, whether alone
or as employee, owner, partner, officer, director, consultant, agent, executive,
independent contractor, or stockholder of any firm, corporation or other
commercial enterprise, directly or indirectly solicit business from: (i) any
customer of the Company with which Executive had contact, participated in the
contact, or about which Executive had knowledge of Confidential Information by
reason of Executive’s employment with the Company within the one year period
preceding the Date of Termination, or (ii) any current customer prospect of the
Company for whom Executive directly or indirectly assisted in the preparation or
submission of a proposal made by the Company to such customer prospect during
the one year period preceding the Date of Termination, unless the Company
acknowledges in writing its intent not to further pursue such customer prospect;
provided, further, that Executive shall, however, be permitted to own securities
of any public company not in excess of 5% of any class of such securities and to
own stock, partnership interests or other securities of any non-public entity
not in excess of 5% of any class of such securities, and such ownership shall
not be considered to be in competition with the Company; and

     

    (e)           Except
as may be required in the ordinary course of performing his duties as an
employee of the Company, while employed prior to his Date of Termination and
during the one year period immediately following the Date of Termination,
Executive shall not, directly or indirectly, solicit or attempt to solicit any
employee of the Company to work for any person, partnership or entity other than
the Company, or engage in any activity that would cause any such employee to
violate any agreement with the Company, or dissuade, or attempt to dissuade, any
such employee from faithfully discharging such employee’s contractual and
fiduciary obligations to serve the Company’s interests with undivided
loyalty.

     

    7.2           Non
Competition.  Without limiting the obligation imposed by
Section 7.1, and to more fully protect the Confidential Information, Executive
hereby agrees that while he is employed by the Company prior to the Date of
Termination and for a period of one year following the Date of Termination, he
will not, directly or indirectly, anywhere in the world where the Company
conducts business, render services to any Conflicting Organization in any
capacity in which the Confidential Information of the Company would reasonably
be considered to be useful to the Conflicting Organization; provided, however,
that Executive may render services to a Conflicting Organization (and which has
separate and distinct divisions), as long as such services are being rendered
solely to a part of the business that is separate and distinct from the part of
the business that renders such person or entity a Conflicting
Organization.

    
      
         

      

      
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    If, at the time of enforcement of
Sections 7.1 and 7.2, a court shall hold that the duration, scope, area or
activity restrictions stated herein are unreasonable under circumstances then
existing, the parties agree that the maximum duration, scope, area or activity
restrictions reasonable and enforceable under such circumstances shall be
substituted for the stated duration, scope, area or activity
restrictions.

     

    7.3           Remedies.  Executive
recognizes and agrees that a breach of any or all of the provisions of Sections
7.1 and 7.2 will constitute immediate and irreparable harm to the Company for
which damages cannot be readily calculated and for which damages are an
inadequate remedy.  Accordingly, Executive acknowledges that in
addition to any and all remedies at law, the Company shall be entitled, without
bond, to specific performance or injunctive or other equitable relief to prevent
the breach or threatened breach of Executive’s obligations under this
Agreement.

     

    7.4           Intellectual
Property.  During the employment period, Executive shall
disclose immediately to the Company all ideas, inventions and business plans
that he makes, conceives, discovers or develops during the course of his
employment with the Company, including any inventions, modifications,
discoveries, developments, improvements, computer programs, processes, products
or procedures (whether or not protectable upon application by copyright, patent,
trademark, trade secret or other proprietary rights) (“Work Product”) that: (i)
relate to the business of the Company or any customer or supplier to the Company
or any of the products or services being developed, manufactured, sold or
otherwise provided by the Company or that may be used in relation therewith;
(ii) result from tasks assigned to Executive by the Company; or (iii) result
from the use of the premises or personal property (whether tangible or
intangible) owned, leased or contracted for by the Company.  Executive
agrees that any Work Product shall be the property of the Company and, if
subject to copyright, shall be considered a “work made for hire” within the
meaning of the Copyright Act of 1976, as amended (the “Act”).  If and
to the extent that any such Work Product is found as a matter of law not to be a
“work made for hire” within the meaning of the Act, Executive expressly assigns
to the Company all right, title and or interest in and to the Work Product, and
all copies thereof, and the copyright, patent, trademark, trade secret and all
their proprietary rights in the Work Product, without further consideration,
free from any claim, lien for balance due or rights of retention thereto on the
part of Executive.

     

    (a)           To
the extent applicable, pursuant to Illinois Employee Patent Act, the Company
hereby notifies Executive that the preceding paragraph does not apply to any
inventions for which no equipment, supplies, facility, or trade secret
information of the Company was used and which was developed entirely on the
Executive’s own time, unless: (i) the invention relates (a) to the Company’s
business, or (b) to the Company’s actual or demonstrably anticipated research or
development, or (ii) the invention results from any work performed by the
Executive for the Company.

    
      
         

      

      
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    (b)           Executive
agrees that upon disclosure of Work Product to the Company, Executive will,
during his employment and at any time thereafter, at the request and cost of the
Company execute and deliver all such documents and perform all such acts as the
Company or its duly authorized agents may reasonably require: (i) to apply for,
obtain and vest in the name of the Company alone (unless the Company otherwise
directs) letters patent, copyrights or other analogous protection in any country
throughout the world, and when so obtained or vested to renew and restore the
same; and (ii) to defend any opposition proceedings in respect of such
applications and any opposition proceedings or petitions or applications for
revocation of such letters patent, copyright or other analogous
protection.

     

    (c)           In
the event that the Company is unable, after reasonable effort, to secure
Executive’s signature on any letters patent, copyright or other analogous
protection relating to Work Product, whether because of Executive’s physical or
mental incapacity or for any other reason whatsoever, Executive hereby
irrevocably designates and appoints the Company and its duly authorized officers
and agents as his agent and attorney-in-fact, to act for and on his behalf to
execute and file any such application or applications and to do all other
lawfully permitted acts to further the prosecution and issuance of letters
patent, copyright and other analogous protection with the same legal force and
effect as if personally executed by Executive.

     

    Article VIII —
LIMITATION ON PAYMENTS AND BENEFITS

     

    Notwithstanding
any provision of this Agreement to the contrary, if any amount or benefit to be
paid or provided under this Agreement would be an “Excess Parachute Payment”
within the meaning of Section 280G of the Code or any successor provision
thereto(which the parties agree will not include any portion of payments
allocated to the non-solicitation and non-compete provisions of Article VII
which are classified as payments of reasonable compensation for purposes of
Section 280G of the Code), then the payments and benefits to be paid or provided
under this Agreement shall be reduced to the minimum extent necessary so that no
portion of any such payment or benefit as so reduced constitutes an Excess
Parachute Payment.

     

    Article IX —
MISCELLANEOUS

     

    9.1           Clawback
Provision.  In the event of a restatement of the Company’s
previously issued financial statements, the Board will review the circumstances
regarding the restatement and all performance-based compensation awarded to the
Executive that is attributable to performance during the time periods
restated.  If the Board determines that (i) the restatement is
required due to the failure of the Company’s management to act reasonably and
(ii) the Executive received more compensation than he would have received absent
the restated financial statements, then the Board will take action to recoup any
such excess compensation and the Executive agrees to repay such
amount.  Notwithstanding any other provision in this Agreement, in
such event, the Executive may be required to (x) repay some or all of any bonus
or other performance-based compensation received, (y) repay any gains realized
on the exercise of stock options or on the open-market sale of vested shares; or
(z) have his future compensation adjusted.  In the event the Executive
does not agree with the Board’s determination as to (A)  whether the
restatement is required due to the failure of the Company’s management to act
reasonably or (B) the amount of the excess compensation received, the Executive
may submit the matter to binding arbitration in Chicago, Illinois (unless the
parties agree in writing to a different location), before a single arbitrator in
accordance with the American Arbitration Association’s National Rules for the
Resolution of Employment Disputes then in effect. The decision and award made by
the arbitrator shall be final, binding and conclusive on all parties hereto for
all purposes, and judgment may be entered thereon in any court having
jurisdiction thereof.  Except as set forth below, the Company shall
pay the costs of the arbitration, including administrative fees and the fees of
the arbitrator.  Each party shall be responsible for the fees and
costs of their attorneys and  the expenses of their
witnesses.

    
      
         

      

      
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    9.2           Approvals. The
Company represents and warrants to Executive it has taken all corporate action
necessary to authorize this Agreement.

     

    9.3           Full
Settlement.  The exclusive method for the Company to terminate
its obligations to provide compensation or benefits to Executive pursuant to
Articles IV and V of this Agreement is to terminate Executive’s employment in
compliance with all applicable requirements of Sections 6.1, 6.2, 6.3, 6.4 or
6.5 of this Agreement, as applicable, and to make the payments and provide the
benefits specified in such applicable Section.

     

    9.4           No
Mitigation.  In no event shall Executive be obligated to seek
other employment or take any other action to mitigate the amounts payable to
Executive under any of the provisions of this Agreement, nor shall the amount of
any payment hereunder be reduced by any compensation earned as a result of
Executive’s employment by another employer, except that any continued welfare
benefits provided for by Section 6.3(f) or Section 6.4(c) shall not duplicate
any benefits that are provided to Executive and his family by such other
employer and shall be secondary to any coverage provided by such other
employer.

     

    9.5           Enforcement.  If
the Company fails to pay any amount provided under this Agreement when due, the
Company shall pay interest on such amount at an annual rate equal to the lesser
of (i) (A) the highest rate of interest charged by the Company’s principal
lender on its revolving credit agreements plus 200 basis points, or (B) in the
absence of such a lender, 200 basis points over the prime commercial lending
rate announced by The Wall Street Journal in effect from time to time during the
period of such nonpayment, or (ii) the highest legally-permissible interest rate
allowed to be charged under applicable law.

     

    9.6           Release.  Notwithstanding
any provisions of this Agreement to the contrary, the Company’s obligations to
make payments under Sections 6.3, 6.4 and 6.5, other than the obligation to pay
Accrued Base Salary and Accrued Annual Bonus (the “Termination Payments”), are
expressly conditioned upon the Executive’s execution of a release and waiver
substantially in the form attached hereto as Exhibit B (the “Release”), and the
expiration of the revocation period.  The Company shall deliver a copy
of the Release to Executive within five (5) days following Executive’s
termination of employment and, within forty-five (45) days thereafter, the
Release shall be executed and returned to the Company by
Executive.  Termination Payments shall commence pursuant to the
schedules provided herein on the first practicable payroll date following the
expiration of the revocation period or the 60th day following the Executive’s
termination of employment, whichever comes last.

    
      
         

      

      
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    9.7           Beneficiary.  If
Executive dies prior to receiving all of the amounts payable to him in
accordance with the terms and conditions of this Agreement, such amounts shall
be paid to the beneficiary designated by Executive in writing to the Company
during his lifetime, or if no such beneficiary is designated, to Executive’s
estate.  Such payments shall be made in a lump sum to the extent so
payable and, to the extent not payable in a lump sum, in accordance with the
terms of this Agreement.  Such payments shall not be less than the
amount payable to Executive as if Executive had lived to the date of payment and
were the payee.  Executive, without the consent of any prior
beneficiary, may change his designation of beneficiary or beneficiaries at any
time or from time to time by submitting to the Company a new designation in
writing.

     

    9.8           Assignment;
Successors.  The Company may not assign its respective rights
and obligations under this Agreement without the prior written consent of
Executive except to a successor of the Company’s business.  This
Agreement shall be binding upon and inure to the benefit of Executive, his
estate and Beneficiaries, the Company and the successors and permitted assigns
of the Company.

     

    9.9           Non-Alienation.  Except
as is otherwise expressly provided herein, benefits payable under this Agreement
shall not be subject in any manner to anticipation, alienation, sale, transfer,
assignment, pledge, encumbrance, charge, garnishment, execution or levy of any
kind, either voluntary or involuntary, prior to actually being received by
Executive, and any such attempt to dispose of any right to benefits payable
hereunder shall be void.

     

    9.10           Severability.  If
all or any part of this Agreement is declared 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 provision so
declared to be unlawful or invalid shall, if possible, be construed in a manner
which will give effect to the terms of such provision to the fullest extent
possible while remaining lawful and valid.

     

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

     

    9.12           Notices.  All
notices hereunder shall be in writing and delivered by hand, by
nationally-recognized delivery service that guarantees overnight delivery, or by
first-class, registered or certified mail, return receipt requested, postage
prepaid, addressed as follows:

    
      
         

      

      
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                  If
      to the Company, to:

                	
                  Corporate
      Secretary

                
	 
      	
                  AMCOL
      International Corporation

                
	 
      	
                  2870
      Forbs Avenue

                
	 
      	
                  Hoffman
      Estates, IL 60192

                
	 
      	 
      
	
                  If
      to Executive, to:

                	
                  His
      most recent home
address.

                

        

      

    

     

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

     

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

     

    9.14           Captions.  The
captions of this Agreement are not a part of the provisions hereof and shall
have no force or effect.

     

    9.15           Section
409A.  The parties intend that the compensation and benefits to
be provided under this Agreement shall be exempt from or compliant with the
requirements of Code Section 409A of the Code and this Agreement shall be
interpreted and applied in a manner consistent with such
intent.  Notwithstanding anything in this Agreement to the contrary,
if payment of any amounts under this Agreement would be subject to additional
taxes and interest under Code Section 409A because the timing of such payments
is not delayed as provided in Section 409A(a)(2)(B)(i) of the Code and the
regulations thereunder, then any such payments to which Executive would
otherwise be entitled during the first six months following the date of his
Termination of Employment shall be accumulated and paid on the second business
day that is six months after the date of such Termination of Employment with
Company, or such earlier date upon which such payments can be paid under Code
Section 409A of the Code without being subject to such additional taxes and
interest.  Further, notwithstanding anything in this Agreement to the
contrary, if benefits to be made available under this Agreement would be subject
to additional taxes and interest under Code Section 409A because the provision
of such benefits is not delayed for the first six months following the date of
Executive’s Termination of Employment with Company as provided in Code Section
409A(a)(2)B)(i) of the Code and the regulations thereunder, such benefits shall
not be delayed; however, Executive shall pay to Company, at the time or times
such benefits are provided, the fair market value of such benefits, and Company
shall reimburse Executive for any such payments on or within ten days following
the expiration of such six-month period.  Executive hereby agrees to
be bound by Company’s determination of its “specified employees” (as such term
is defined in Code Section 409A) in accordance with any of the methods permitted
under the regulations issued under Code Section 409A of the Code, which shall be
determined annually by the Company.  The Company makes no
representation or warranty and shall have no liability to Executive or any other
person if any provisions of this Agreement are determined to constitute deferred
compensation subject to Code Section 409A but do not satisfy an exemption from,
or the conditions of, such section.

    
      
         

      

      
        19

        
          

        

      

      
         

      

    

     

    9.16           Entire
Agreement.  As of the Effective Date, this Agreement will form
the entire agreement between the parties hereto with respect to the subject
matter contained in the Agreement and shall supersede all prior agreements,
promises and representations regarding employment, compensation, severance or
other payments contingent upon termination of employment, whether in writing or
otherwise, including but not limited to that certain Employment Agreement dated
March 24, 2006 by and between the Company and the Executive.

     

    9.17           Applicable
Law.  This Agreement shall be interpreted and construed in
accordance with the laws of the State of Illinois, without regard to its choice
of law principles.

     

    9.18           Survival of Executive’s
Rights.  All of Executive’s post-termination rights hereunder,
including Executive’s rights to compensation and benefits under Article VI of
this Agreement, and his post-termination obligations, including but not limited
to his obligations under Article VII (Covenants) and Article IX (Miscellaneous),
shall survive the termination of Executive’s employment and the termination of
this Agreement.

     

    IN
WITNESS WHEREOF, the parties have executed this Agreement on the date set forth
below.

     

    
      
        	
                AMCOL
      INTERNATIONAL CORPORATION

              
	 
      
	
                By:

              	
                /s/
      James W. Ashley

              
	
                Its:

              	
                Secretary

              
	
                Date:

              	
                February
      2, 2009

              
	 
      
	
                EXECUTIVE

              
	 
      	 
      
	
                      
                  /s/Ryan F.
      McKendrick

                

              
	
                Date:  February
      2, 2009

              

      

    

    
      
         

      

      
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    Exhibit
A

     

    Named
Executives

     

    Gary L.
Castagna

     

    Ryan F.
McKendrick

     

    Donald W.
Pearson

     

    Lawrence
E. Washow

    
      
         

      

      
        21

        
          

        

      

      
         

      

    

    Exhibit
B

     

    FORM OF
EMPLOYMENT

    SEPARATION AGREEMENT AND
MUTUAL RELEASE

    

     

    AMCOL International Corporation
(“Employer”) and [Executive’s Name] (“Executive”) hereby agree as
follows:

     

    1.           Executive’s
employment with Employer terminated on ______________ (“the Termination
Date”).

     

    2.           Employer
denies that it is liable to Executive for any reason whatsoever, and the entry
into this Separation Agreement and Release shall not constitute any admission or
evidence of unlawful discrimination or improper conduct, and should not be
construed as an admission of fault, wrongdoing, or
liability.  However, in consideration of the mutual promises herein,
Employer will provide Executive with the following:

     

    [INSERT
AMOUNTS TO BE PAID]

     

    Executive
acknowledges that he has received good and valuable consideration for the
promises herein.  Payment will be made as set forth in Executive’s
Employment Agreement.

     

    3.           Except
as set forth in this Agreement, no further payments will be made
to  Executive for wages, salary, bonus, expense reimbursement,
commissions, consulting, benefits, severance, vacation, personal days, sick pay,
disability pay or otherwise.

    
      
         

      

      
        22

        
          

        

      

      
         

      

    

    4.           Executive
releases, forever discharges and covenants not to sue Employer or its current or
former parent companies, subsidiaries, affiliates, predecessors, successors,
insurers, directors, officers, employees, agents, or assigns, with respect to
any and all claims, causes of action, suits, debts, sums of money,
controversies, agreements, promises, damages, and demands whatsoever, including
attorneys’ fees and court costs, in law or equity or before any federal, state
or local administrative agency, whether known or unknown, suspected or
unsuspected, which  Executive has, had, or may have, based on any
event occurring, or alleged to have occurred, to the date of this
Agreement.  This release includes, but is not limited to, claims under
Title VII of the Civil Rights Act of 1964, as amended, the Americans with
Disabilities Act, the Rehabilitation Act, the Age Discrimination in Employment
Act, the Employee Retirement Income Security Act, the Family and Medical Leave
Act and any federal, state or local statute, law, regulation, ordinance, or
order, and claims arising under common law, contract, implied contract, public
policy or tort.  To the extent any such claim cannot be waived as a
matter of law, it is understood that  Executive reserves the right to
file such claim, but Executive expressly waives his right to any relief of any
kind should any person or entity pursue any claim on Executive’s
behalf.  Notwithstanding the foregoing release of all claims, it is
understood and agreed that Executive’s claims for unemployment compensation, if
any, are not released.

     

    5.           Executive
expressly waives and relinquishes all rights and benefits provided to him by any
statute or other law which prohibits release of unspecified claims and
acknowledge that this release is intended to include all claims he has or may
have, whether he is aware of them or not, and that all such claims are released
by this Agreement.

     

    6.           Executive
shall not disclose any proprietary, trade secret or other confidential business
information learned solely by reason of  Executive’s employment with
Employer.  Executive agrees that the post-termination obligations of
his Employment Agreement with AMCOL International Corporation will remain in
full force and effect.

     

    7.           Executive
agrees to cooperate with Employer in regard to the transition of business
matters handled by Executive during his employment with Employer and in regard
to any litigation brought by or against Employer.

    
      
         

      

      
        23

        
          

        

      

      
         

      

    

    

    8.           This
Agreement is strictly confidential and Executive will not inform any person of
any of its terms and conditions or the amount of severance provided herein,
except for  Executive’s attorney, members of his immediate family and
those who need to know for  Executive’s compliance with federal,
state, or local law.  Executive will instruct any persons advised
about this Agreement pursuant to this provision to keep such information
strictly confidential.

     

    9.           Executive
will not make statements about Employer or engage in conduct which could
reasonably be expected to adversely affect Employer’s reputation or
business.

     

    10.         Executive
understands that this Agreement fully sets forth all separation benefits he will
receive from Employer, and it supersedes any offers or promises, whether oral or
written, which may have been made at any time.

     

    11.         This
Agreement will not take effect until eight days after Executive signs
it.

     

    12.         Executive
may revoke this Agreement within seven days after signing it and render it null
and void.  If  Executive wishes to revoke this Agreement, he
should notify ____________________________, in writing at
_________________________ of Executive’s intent to revoke within seven days
after signing this Agreement.

     

    13.         Executive
acknowledges that he has fully read this Agreement, understands its terms, has
been advised to consult with an attorney prior to signing this Agreement, has
been given 45 days to consider this release and its ramifications, has been
given seven days after signing to rescind this Agreement, and is entering into
this Agreement knowingly and voluntarily.  Executive further agrees
that any modification of this Agreement, whether material or not, will not
restart or change the original 45-day consideration period.

    
      
         

      

      
        24

        
          

        

      

      
         

      

    

    

    
      
        
          
            
              
                
                  
                    
                      
                        
                          
                            
                              
                                
                                  	 
      	THIS
      DOCUMENT IS A RELEASE OF ALL CLAIMS - READ CAREFULLY BEFORE
    SIGNING
	 	 	 
	
                                          DATED:  ___________

                                        	 
      
	 
      	Executive
	 
      	 
      	 
      
	 
      	
                                          AMCOL
      INTERNATIONAL 

                                          CORPORATION

                                        
	 
      	 
      	 
      
	
                                          DATED:
      __________

                                        	
                                          By:

                                        	 
      
	 	 	 
	 
      	
                                          Its 

                                        	 
      

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      
         

      

      
        25

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