such other office location as may be within a thirty-five (35) mile radius from the Company’s current offices in Princeton, New Jersey), unless the Executive consents in writing to the relocation of the Company’s offices, in which case the Executive shall primarily perform his duties hereunder at such new location(s).

b.                                       During the Employment Term, Executive will devote substantially all of Executive’s business time, and will devote Executive’s personal efforts, to the performance of Executive’s duties hereunder and will not engage in any other business, profession or occupation for compensation or otherwise which would materially conflict or materially interfere with the rendition of such services either directly or indirectly, without the prior written consent of the Board; provided , however , that nothing herein shall preclude Executive, (i) subject to the prior approval of the Board, from accepting appointment to or continue to serve on any board of directors or trustees of any business corporation or any charitable organization or (ii) from managing his personal and family investments; provided , however , in each case, and in the aggregate, that such activities do not materially conflict or materially interfere with the performance of Executive’s duties hereunder or conflict with Section 9.

3.                                        Base Salary .  During the Employment Term, the Company shall pay Executive a base salary at the annual rate of $1,300,000, payable in substantially equal periodic payments in accordance with the Company’s practices for other executive employees, as such practices may be determined from time to time.  Executive shall be entitled to such increases in Executive’s base salary, if any, as may be determined from time to time in the sole discretion of the Board.  Executive’s annual base salary, as in effect from time to time, is hereinafter referred to as the “Base Salary.”  Once increased, the Executive’s Base Salary shall not be decreased below such increased amount.

4.                                        Annual Bonus . With respect to each full fiscal year during the Employment Term, Executive shall be eligible to earn an annual bonus award (an “Annual Bonus”), with a target bonus amount equal to 150% of Executive’s Base Salary (the “Target Bonus”) based upon the achievement of reasonable performance goals established by the Board, provided , that to the extent that any portion of the achievement of the goals or amount of the Annual Bonus shall be based on a subjective criteria, that portion of the achievement of the goals or Annual Bonus shall be as determined in the sole, good faith discretion of the Board.  In addition, in the sole discretion of the Board, Executive may be eligible to earn an Annual Bonus in excess of the Target Bonus.  In addition, the Board shall establish certain threshold performance goals, which the Company must achieve before Executive shall be entitled to earn any Annual Bonus.  All Annual Bonus amounts shall otherwise be paid in accordance with the Company’s annual incentive plan or policy, but in all cases within 2-1/2 months following the close of the fiscal year.

In the event the Company is required to prepare a restatement of its financial results for a fiscal year and the Board in good faith determines that the need for such restatement was due to the intentional misconduct of one or more of the senior executive officers of the Company, Executive shall, within 60 days of receiving notice of such Board determination (which notice shall state the reasons for the need for the restatement, identify the misconduct and include calculations of the impact thereof), reimburse the Company, net of taxes, for all excess remuneration (as defined below) received by Executive in connection with the Annual Bonus

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received by Executive with respect to such fiscal year.  For purposes of this provision, the term “excess remuneration” means the excess of the Annual Bonus payment made to Executive for such fiscal year over the payment that would have been made to Executive for such fiscal year had Executive’s payment been calculated based on the financial statements as restated, as determined in the good faith discretion of the Board.

5.                                        Equity Arrangements .  During the Employment Term, Executive shall be eligible to be granted equity awards on such terms and conditions as may be determined by the Compensation Committee of the Board.

Executive’s equity arrangements, to the extent not inconsistent herewith, shall be governed by the terms and conditions of certain documents, including a Management Stockholder’s Agreement, the Stock Purchase and Option Plan for Key Employees of Rockwood Holdings, Inc. and Subsidiaries (the “Stock Incentive Plan”), Restricted Stock Unit Award Agreement, Share Option Agreement, Sale Participation Agreement, and Registration Rights Agreement, in the forms attached to the Original Employment Agreement (collectively, the “Management Equity Documents”).

6.                                        Employee Benefits .

a.                                        During the Employment Term, Executive shall be entitled to participate in the Company’s employee benefit plans (other than annual bonus and incentive plans described in Section 4) as in effect from time to time (collectively “Employee Benefits”), on the same basis as those benefits are generally made available to other senior executives of the Company.  Such plans and programs currently include the following:

(i)                                      Rockwood Health Care Benefits (medical, pharmaceutical, dental and vision),

(ii)                                   Rockwood Long-Term Disability Plan,

(iii)                                Rockwood Life and Accident Plan,

(iv)                               Rockwood Health Care and Dependent Care Reimbursement Account,

(v)                                  Senior Executive Health Plan,

(vi)                               Personal Excess Liability Insurance Program, and

(vii)                            Rockwood Retirement Plus Program (Profit Share/401(k) and Money Purchase Plan).

b.                                       The Company shall also pay to Executive during the Employment Term the sum of $50,000 per month (the “Supplemental Pension Benefit”) which shall be paid monthly.

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7.                                        Business Expenses and Perquisites .

a.                                        Expenses .  During the Employment Term, reasonable business expenses incurred by Executive in the performance of Executive’s duties hereunder shall be reimbursed by the Company in accordance with Company policies (but in no event later than the last day of the calendar year next following the calendar year in which the expenses were incurred).

b.                                       Company Car .  During the Employment Term, the Executive will be provided (at no after-tax cost to Executive) with use of a Company automobile, including reimbursement on a monthly basis for expenses associated with operating the automobile including gas, insurance and maintenance.  The reimbursements and tax gross-up payments called for by this Section 7(b) shall be paid in accordance with the Company’s reimbursement policy for senior executives (but in no event later than the last day of the calendar year next following the calendar year in which the Executive pays the expenses or related taxes, respectively).

c.                                        Other Perquisites .  Executive shall be entitled to such other perquisites as shall be agreed to by Executive and the Company.

8.                                        Termination .  The Employment Term and Executive’s employment hereunder may be terminated by either party at any time and for any reason; provided , however , that Executive will be required to give the Company at least one hundred eighty (180) days advance written notice of any resignation of Executive’s employment; provided , further , however , that the Company may, in its discretion, waive all or any portion of such notice requirement.  In the event that the Company waives all or any portion of such notice requirement and therefore causes Executive’s employment to be terminated, in no event shall such waiver constitute a termination without Cause by the Company (as described in Section 8(c) below).  In addition, Executive’s notice requirement hereunder shall be subject to the notice provisions of Section 8(c) below.

a.                                        By the Company For Cause or By Executive Resignation Without Good Reason .

(i)                   The Employment Term and Executive’s employment hereunder may be terminated by the Company for Cause (as defined below) immediately, without prior written notice thereof, and shall terminate automatically (subject to the notice requirements, which may be waived by the Company, as described above in this Section 8) upon Executive’s resignation without Good Reason (as defined in Section 8(c)).

(ii)                For purposes of this Agreement, “Cause” shall mean (A) Executive’s willful and continued refusal to perform duties, which are within the control of Executive and consistent with such Executive’s title and position, that is not cured within 15 days following receipt by the Executive of written notice from the Company of such failure, (B) Executive’s conviction of or plea of guilty or no contest to a (x) felony, (y) misdemeanor involving the Company or (z) misdemeanor not involving the Company, which results in material and demonstrable harm to the business or reputation of the Company (in each case of (x), (y) or (z),

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other than as a result of vicarious liability under any environmental criminal statute), (iii) Executive’s willful malfeasance or misconduct (x) relating to the Company which is demonstrably injurious to the Company or its subsidiaries, other than in a manner that is insignificant or inconsequential or (y) not involving the Company, but which results in material, adverse and demonstrable harm to the Company or its subsidiaries or (iv) a breach by Executive of the material term of Section 9 of this Agreement, following notice of such breach (which notice may be oral or written) that (if, in the good faith discretion of the Board, is able to be cured by Executive) is not cured within 15 days following receipt by the Executive of written notice from the Company that it reasonably believes Executive is in breach of any such covenants; provided , however , that Cause shall cease to exist as an event on the 60 th day following actual and substantiated knowledge of the Cause event by the chairman of the compensation or audit committee of the Board unless, prior to such date, the Company has given Executive written notice of the event constituting Cause and Executive’s opportunity to cure.  For purposes of this subsection, no act, or failure to act, on Executive’s part shall be considered “willful” unless done or omitted to be done, by him not in good faith and without reasonable belief that his action or omission was in the best interests of the Company.

(iii)             If Executive’s employment is terminated by the Company for Cause, or if Executive resigns without Good Reason, Executive shall be entitled to receive:

(A)                               the Base Salary and any accrued but unpaid Supplemental Pension Benefit through the date of termination and any earned but unpaid Annual Bonus for the prior year and any accrued but unpaid vacation;

(B)                                 reimbursement for any unreimbursed business expenses properly incurred by Executive in accordance with Company policy prior to the date of Executive’s termination; and

(C)                                 such employee benefits (described in Section 6(a) above), if any, as to which Executive may be entitled under the employee benefit plans of the Company (the amounts described in clauses (A) through (C) hereof being referred to as the “Accrued Rights”).

Following such termination of Executive’s employment by the Company for Cause or resignation by Executive without Good Reason, except as set forth in this Section 8(a)(iii), Executive shall have no further rights to any compensation or any other benefits under this Agreement other than for rights to indemnification and directors and officers liability insurance as provided herein; provided , however , that the treatment of any equity rights held by Executive immediately prior to any such termination shall be subject to the applicable terms of the Management Equity Documents.

b.                                       Disability or Death .

(i)                   The Employment Term and Executive’s employment hereunder shall terminate upon Executive’s death and may be terminated by the Company if a determination is made, at the request of Executive or upon the reasonable request of the Company set forth in a notice to Executive, by a physician selected by the Company and Executive, that Executive is

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unable to perform his duties as an employee of the Company or its subsidiaries and in all reasonable medical likelihood such inability will continue for a period in excess of 180 consecutive days (such inability is hereinafter referred to as “Disability” or being “Disabled”).  Any question as to the existence of the Disability of Executive as to which Executive and the Company cannot agree shall be determined in writing by a qualified independent physician mutually acceptable to Executive and the Company.  If Executive and the Company cannot agree as to a qualified independent physician, each shall appoint such a physician and those two physicians shall select a third who shall make such determination in writing.  The determination of Disability made in writing to the Company and Executive shall be final and conclusive for all purposes of the Agreement.  Notwithstanding the foregoing, in the event that as a result of mental or physical incapacity Executive earlier incurs a “separation from service” within the meaning of Section 409A, Executive will be deemed to have a termination of employment by reason of Disability under this Agreement as of such date.  In the event Executive is determined to be Disabled, the Company shall, pursuant to a Company employee benefit plan or otherwise, cause Executive to continue to receive the then Base Salary (or such other salary continuation as may be provided pursuant to any Company employee benefit plan) and welfare benefits (in accordance with the applicable Company employee benefit plan under which Executive receives such benefits immediately prior to such Disability) until the earlier to occur of (x) six months after the date Executive is determined to be Disabled and (y) such time as Executive commences coverage pursuant to the Company’s long-term disability plan.

(ii)                Upon termination of Executive’s employment hereunder for either Disability or death, Executive or Executive’s estate (as the case may be) shall be entitled to receive:

(A)                               the Accrued Rights; and

(B)                                 a lump sum pro rata portion of the Annual Bonus, if any, that Executive would have been entitled to receive pursuant to Section 4 hereof for the fiscal year in which such termination occurs based upon the percentage of the fiscal year that shall have elapsed through the date of Executive’s termination of employment, payable when such Annual Bonus would have otherwise been payable had Executive’s employment not terminated, based on the Target for the fiscal year in which termination occurs.

Following Executive’s termination of employment due to death or Disability, except as set forth in this Section 8(b)(ii), Executive shall have no further rights to any compensation or any other benefits under this Agreement other than for rights to indemnification and directors and officers liability insurance as provided herein; provided , however , that the treatment of any equity rights held by Executive immediately prior to any such termination shall be subject to the applicable terms of the Management Equity Documents.

c.                                        By the Company Without Cause or Resignation by Executive for Good Reason .

(i)                   The Employment Term and Executive’s employment hereunder may be terminated by the Company without Cause immediately, without prior written notice thereof, or

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by Executive’s resignation for Good Reason (subject to the notice requirements, which may be waived by the Company, as described above in this Section 8, and to the provision of Section 8(c)(ii), below).  In addition to the foregoing, a notice of non-extension of the Employment Term by the Company shall be deemed to be a termination of the Executive’s employment without Cause as of the date the Company notifies Executive of such non-extension.

(ii)                For purposes of this Agreement, “Good Reason” shall mean, without Executive’s consent, (A) a reduction in Executive’s base salary or annual bonus opportunity, (B) a substantial reduction in Executive’s duties, authorities, and responsibilities or removal from Executive of the title of Chief Executive Officer of the Company, (C) the Executive’s removal from, or failure to be re-elected to the Board, (D) the elimination or reduction of Executive’s eligibility to participate in the Company’s benefit programs that is inconsistent with the eligibility of similarly situated employees of the Company to participate therein, provided , however , that any adverse change to the terms of the Supplemental Pension Benefit shall be deemed an event of Good Reason, (E) a transfer of Executive’s primary workplace by more than thirty-five (35) miles from the Company’s offices in Princeton, New Jersey, (F) any failure by the Company to pay when due any payment owed to Executive within 15 days after the date such payment becomes due or (G) failure of any successor to the Company (whether direct or indirect and whether by merger, acquisition, consolidation or otherwise) to assume in a writing delivered to the Executive, upon the assignee becoming such, the obligations of the Company hereunder; provided that either of the events described in clauses (A) and (B) of this Section 8(c)(ii) shall constitute Good Reason only if the Company fails to cure such event within 30 days after receipt from Executive of written notice of the event which constitutes Good Reason; and provided , further , that “Good Reason” shall cease to exist for an event on the 60 th  day following the later of its occurrence or Executive’s knowledge thereof, unless Executive has given the Company written notice thereof prior to such date.

(iii)             If Executive’s employment is terminated by the Company without Cause (other than by reason of death or Disability) or if Executive resigns for Good Reason, Executive shall be entitled to receive:

(A)                               the Accrued Rights

(B)                                 a lump sum pro rata portion of any Annual Bonus, if any, that Executive would have been entitled to receive pursuant to Section 4 hereof for the fiscal year in which such termination occurs (but only to the extent of achievement of the applicable performance standards for such y