FOR SIX (6) CONSECUTIVE MONTHS AND IF HE QUALIFIES FOR LONG-TERM
DISABILITY UNDER QUIXOTE'S LONG-TERM DISABILITY INSURANCE PLAN.
(D)
SALARY CONTINUATION PERIOD.
THE "SALARY CONTINUATION PERIOD"
SHALL MEAN ONE (1) YEAR FROM THE DATE OF A TERMINATION OF THE EXECUTIVE.
2.
TERMINATION.
(A)
TERMINATION OF EMPLOYMENT.
IF THE EXECUTIVE'S EMPLOYMENT (X) IS
TERMINATED FOR GOOD REASON, OR (Y) IS TERMINATED FOR A REASON OTHER THAN DEATH,
DISABILITY, CAUSE OR VOLUNTARY RESIGNATION NOT CONSTITUTING A GOOD REASON, (A
GOOD REASON TERMINATION OR TERMINATION FOR A REASON OTHER THAN DEATH,
DISABILITY, CAUSE OR VOLUNTARY RESIGNATION NOT CONSTITUTING A GOOD REASON IS
REFERRED TO HEREIN AS A "TERMINATION"), THE EXECUTIVE WILL BE ENTITLED TO
RECEIVE:
(I)
HIS FULL BASE SALARY THROUGH THE DATE OF TERMINATION AT THE RATE IN EFFECT AT
THE TIME TERMINATION OCCURS;
(II)
ANY REIMBURSABLE EXPENSES WHICH HAVE BEEN INCURRED BUT ARE UNPAID;
(III)
PAYMENT FOR ANY UNEXPIRED VACATION DAYS WHICH HAVE ACCRUED BUT ARE UNUSED; AND
(IV)
SUBJECT TO SECTION 7(F), PAYMENT OF THE EXECUTIVE'S BASE SALARY, PLUS COBRA
REIMBURSEMENT AND AUTO ALLOWANCE FOR THE SALARY CONTINUATION PERIOD WHICH SHALL
BE PAID IN A LUMP SUM (THE "SEPARATION BENEFIT").
(B)
RELEASE AGREEMENT.
PRIOR TO EXECUTIVE OBTAINING THE RIGHT TO
RECEIVE, AND IN EXCHANGE FOR, THE SEPARATION BENEFIT PROVIDED IN
SECTION 2(A)(IV), ABOVE, EXECUTIVE WILL FIRST ENTER INTO AND EXECUTE, AND
DELIVER TO QUIXOTE, A RELEASE AGREEMENT SUBSTANTIALLY IN THE FORM ATTACHED
HERETO AS EXHIBIT A (THE "RELEASE") UPON EXECUTIVE'S TERMINATION OF EMPLOYMENT.
UNLESS THE RELEASE IS EXECUTED BY EXECUTIVE AND DELIVERED TO QUIXOTE WITHIN THE
TIME PERIOD SET FORTH IN PARAGRAPH 15 OF THE RELEASE, EXECUTIVE WILL NOT RECEIVE
THE PAYMENTS PROVIDED IN SECTION 2(A)(IV) ABOVE.
2
(C)
TERMINATION OF SEVERANCE AND NON-COMPETITION AGREEMENT.
THIS
SEVERANCE AND NON-COMPETITION AGREEMENT SHALL TERMINATE ON THE TENTH ANNIVERSARY
OF THIS AGREEMENT IF THE EMPLOYMENT OF EXECUTIVE HAS NOT BEEN TERMINATED PRIOR
TO THAT DATE.
3.
Withholding Taxes; Code Section 409A.
All payments made under
this Agreement shall be subject to reduction to reflect all federal, state,
local and other taxes required to be withheld by applicable law.
Notwithstanding anything to the contrary contained in Section 2, if any payment
to the Executive under Section 2 would constitute a "deferral of compensation"
under Section 409A of the Internal Revenue Code of 1986, as amended (the
"Code"), (such compensation does not, for example, qualify for the "short-term
deferral exception" under Section 409A of the Code) and the Executive is a
"specified employee" (as such phrase is defined in Section 409A of the Code),
the Executive (or the Executive's beneficiary) will receive payment of such
amounts described in this Section 3 which would otherwise be payable hereunder
during the first six (6) months following the Executive's "separation from
service" with Quixote (as such phrase is defined in Section 409A of the Code)
upon the first to occur of:
(i) the date which is first date of the seventh
month after the effective date of the Executive's separation from service, or
(ii) the date of