Document:

Exhibit 10.5

 

SEVERANCE AND
NON-COMPETITION AGREEMENT

 

THIS SEVERANCE AND
NON-COMPETITION AGREEMENT, dated as of July 25, 2008 (the “Agreement”), is
by and between Quixote Corporation, a Delaware corporation having its principal
offices at 35 East Wacker Drive, Chicago, IL 60601 (“Quixote”), and Daniel
P. Gorey, an Executive of the Company (“Executive”).

 

WHEREAS, the Executive is a
key employee of Quixote who possesses valuable proprietary knowledge of
Quixote, its business and operations and the markets in which Quixote competes;
and

 

WHEREAS, the Board of
Directors of Quixote (the “Board”) has recognized and continues to recognize
that the Executive’s contribution to the growth and success of Quixote has
been, and is expected to continue to be, substantial and desires to assure
Quixote of the Executive’s continued employment by assuring him of fair
treatment if that relationship is terminated; and

 

NOW, THEREFORE, in
consideration of the foregoing, the mutual covenants and conditions contained
herein and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

1.             Certain Defined Terms.

 

(a)           Good Reason.  “Good Reason” shall mean either of the events
described in (i) and (ii) of this subsection 1(a) occurring
without the Executive’s written consent. 
The Executive’s termination of employment hereunder shall not be treated
as a termination for Good Reason unless (1) the Executive provides notice
to Quixote of the existence of the Good Reason no later than sixty (60) days
after the occurrence of the event which forms the basis for any termination for
Good Reason, and (2) Quixote fails to remedy the Good Reason within thirty
(30) days after receipt of notice from the Executive of the existence of the
Good Reason (the “Cure Period”), and (3) the Executive tenders his
resignation in writing to Quixote within fifteen (15) days after end of the
Cure Period:

 

	
  (i)

  	
   

  	
  the Executive’s base compensation and fringe benefits are reduced, in
  the aggregate, by 20% or more; or

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Quixote fails to obtain the assumption of the obligation to perform
  this Agreement by any successor as contemplated in Section 12 hereof.

  

 

(b)           Cause.  Quixote shall have “Cause” to terminate the
Executive’s employment upon:

 

	
  (i)

  	
   

  	
  the willful failure by the Executive to substantially perform his
  duties, other than when such failure resulting from the Executive’s
  incapacity is due to physical or mental illness;

  

 

 

	
  (ii)

  	
   

  	
  the willful engaging by the Executive in gross misconduct materially
  and demonstrably injurious to Quixote or its subsidiaries; or

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  the commission by the Executive of a crime which is a felony.

  

 

For the purpose of this subsection (b), no act, or the failure to act,
on the 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 interest of 
Quixote or its subsidiaries.

 

(c)           Disability.  An Executive’s “Disability” shall occur if
the Executive is absent from his duties as an Executive of Quixote on a
full-time basis 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 the Executive’s death;
provided however, Quixote shall immediately upon Termination pay such amounts
described in this Section 3 into a domestic “rabbi trust” to be held by a
mutually-acceptable bank or other third party until the Executive is entitled
to receive such payments.

 

4.             Mitigation.  The Executive shall not be required to
mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise, nor shall the amount of any payment provided for
in this Agreement be reduced by any compensation earned by the Executive as a
result of employment by another employer after the date of Termination, or
otherwise.

 

5.             At-Will Employment.  Notwithstanding this Agreement, Executive’s
relationship with Quixote continues to be an at-will employment
relationship.  Quixote or Executive has
the right to terminate Executive’s employment with Quixote at any time with or
without Cause and with or without notice. 
Nothing in this Agreement confers upon the Executive any right to
continue in the employ of Quixote, or in any way limits the rights of Quixote,
except as expressly stated herein, to discharge the Executive at any time for
any reason whatsoever, with or without cause.

 

6.             Confidential Information.  The Executive shall at all times hold in a
fiduciary capacity for the benefit of Quixote all secret, confidential or
proprietary information, knowledge or data relating to Quixote and its
respective businesses, which shall have been obtained by the Executive during
the Executive’s employment by Quixote and which shall not be or become public
knowledge including, but not limited to, information regarding the technology,
proprietary methodologies and products, software, other trade secrets, clients,
suppliers, customers, consultants and agents of Quixote (the “Confidential
Information”).  During the Executive’s
employment with Quixote and after Termination of such employment at any time or
for any reason, and regardless of whether any payments are made to the
Executive under this Agreement as a result of such termination, the Executive
shall not, without the prior written consent of Quixote or as may otherwise be
required by law or legal process, communicate or divulge any Confidential
Information to any person other than Quixote and those designated by it or use
any Confidential Information except for the benefit of Quixote.  Immediately upon Termination of 

 

3

 

the Executive’s employment
with Quixote at any time or for any reason, the Executive shall return to
Quixote all Confidential Information, including, but not limited to, any and
all copies, reproductions, notes or extracts of Confidential Information.  The terms of this Section 6 shall be in
addition to, and not a replacement of, the provisions of any Executive
confidentiality or inventions agreement with Executive.

 

7.             Non-Competition.

 

(a)           Solicitation of Employees.  During the Executive’s employment with
Quixote and for a period of twelve (12) months after termination of such
employment at any time and for any reason, and regardless of whether any
payments are made to the Executive under this Agreement as a result of such
Termination, the Executive shall not solicit, participate in or promote  the solicitation of any person who was
employed by Quixote at the time of the Executive’s Termination of employment
with Quixote to leave the employ of Quixote or its subsidiaries, or, on behalf
of himself or any other person, hire, employ or engage any such person;
provided however that the foregoing restriction shall not prohibit Executive or
a firm with which he is employed or affiliated from (i) publishing and
receiving responses to a general solicitation for employment in a general
circulation newspaper, magazine, website or similar medium, or (ii) hiring
a former employee of Quixote who has not been employed by Quixote or its
subsidiaries for a period of at least six (6) months.  The Executive further agrees that, during
such twelve (12) month period, if a current employee of Quixote contacts the
Executive about prospective employment, the Executive will inform such employee
that he cannot discuss the matter further without informing Quixote.

 

(b)           Covenants During Employment.  During the Executive’s employment, the
Executive will not compete with Quixote anywhere that Quixote conducts its
business.  In accordance with this
restriction, but without limiting its terms, during the Executive’s employment,
the Executive will not:

 

	
  (i)

  	
   

  	
  Enter into or engage in any business which competes with the business
  of Quixote or its subsidiaries;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Solicit customers, business, patronage or orders for, or sell, any
  products and services in competition with, or for any business that competes
  with, the business of Quixote or its subsidiaries;

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Divert, entice or otherwise take away any customers, business,
  patronage or orders of Quixote or its subsidiaries or attempt to do so; or

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Promote or assist, financially or otherwise, any person, firm,
  association, partnership, corporation or other entity engaged in any business
  which competes with the business of Quixote or its subsidiaries.

  

 

(c)           Covenants Following
Termination.  For a
period of one (1) year following the Termination of the Executive’s
employment, the Executive will not:

 

4

 

	
  (i)

  	
   

  	
  Enter into or engage in any business which competes with the business
  of Quixote or its subsidiaries in any country where Quixote or its
  subsidiaries are doing business as of the date of Termination;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Solicit customers, business, patronage or orders for, or sell, any
  products and services in competition with, or for any business, wherever
  located, that competes with the business of Quixote or its subsidiaries in any
  country where Quixote or its subsidiaries are doing business as of the date
  of Termination;

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Divert, entice or otherwise take away any customers, business,
  patronage or orders of Quixote in any country where Quixote or its
  subsidiaries are doing business as of the date of Termination, or attempt to
  do so; or

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Promote or assist, financially or otherwise, any person, firm,
  association, partnership, corporation or other entity engaged in any business
  which competes with Quixote or its subsidiaries in any country where Quixote
  is doing business as of the date of Termination.

  

 

(d)           Indirect Competition.  For the purposes of Sections 7(b) and
7(c), but without limitation thereof, the Executive will be in violation
thereof if the Executive engages in any or all of the activities set forth
therein directly as an individual on the Executive’s own account, or indirectly
as a general partner, joint venturer, employee, agent, salesperson, consultant,
officer and/or director of any firm, association, partnership, corporation or
other entity, or as a limited partner, member or stockholder of any limited
partnership, limited liability company, or corporation in which the Executive
or the Executive’s spouse, child or parent owns, directly or indirectly,
individually or in the aggregate, more than five percent (5%) of the limited
partnership interests, limited liability company interests or outstanding
stock, as the case may be.

 

(e)           Application of Restrictions
Respecting Confidential Information, Solicitation and Competition.  The requirements and obligations of the
Executive under Section 7 shall be in addition to, and not a limitation
under, any other requirements and obligations of the Executive, at law or
otherwise.

 

(f)            Consideration.  The parties agree that for all purposes of
this Agreement and otherwise, Executive’s continued employment with Quixote and
Quixote’s continued provision of confidential information to Executive are
sufficient consideration for this Section 7.  In addition, to the extent that Quixote has
an obligation to pay the Separation Benefit under the Agreement, fifty percent
(50%) of the Separation Benefit hereunder, or an aggregate amount equal to
fifty percent (50%) of such Separation Benefit paid hereunder (to the extent
the Separation Benefit is paid in installments), shall be considered the
consideration payable to Executive for the covenants in this Section 7
(the “Noncompetition Consideration”), and if the Executive violates any of the
covenants set forth in this Section 7, then in addition to and not in
limitation of any of its remedies hereunder or under applicable law, Quixote
shall have the right to refrain from making any further installments of the
Separation Benefit and may recover from 

 

5

 

Executive any amounts of the Separation
Benefit paid to Executive to date up to the amount of the Noncompetition
Consideration.  The parties further agree
that the allocation of a portion of the Separation Benefit as described above
shall not be interpreted as granting to Executive any right to receive
additional amounts hereunder.

 

8.             Rights Apply Only on
Termination.  The rights
granted under this Severance and Non-Competition Agreement only apply upon a
Termination.

 

9.             Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois applicable to
agreements made and to be performed in Illinois, without giving effect to
conflicts of law principles.

 

10.           Headings; Severability.  The section headings of this Agreement are
for reference only and are to be given no effect in the construction or
interpretation of this Agreement.  If any
part or provision of this Agreement shall be declared invalid or unenforceable
by a court of competent jurisdiction, said provision or part shall be
ineffective to the extent of such invalidity or unenforceability only, without
in any way affecting the remaining parts or provisions of this Agreement.

 

11.           Waiver.  Any party may waive compliance by another party
with any of the provisions of this Agreement. 
No waiver of any provision shall be construed as a waiver of any other
provision.  Any waiver must be in
writing.

 

12.           Binding Effect; Assignment.  This Agreement shall be binding on and inure
to the benefit of the parties and their respective successors and permitted
assigns.  Nothing in this Agreement shall
create or be deemed to create any third party beneficiary rights in any person
or entity (including any Executive or person engaged by Quixote in any
capacity) not a party to this Agreement. 
Quixote will require any successor (whether direct or indirect, by
merger, purchase, consolidation or otherwise) of Quixote to make an express
assumption of the obligations hereunder and cause any successor (whether direct
or indirect, by merger, purchase, consolidation or otherwise) to all or
substantially all of the business and/or assets of Quixote to agree to perform
all parts and provisions under this Agreement in the same manner and to the
same extent that Quixote would be required to perform it if no such succession
had taken place.  Failure of Quixote to
obtain such agreement prior to the effectiveness of any such succession shall
be a breach of this Agreement and shall entitle Executive to compensation from
Quixote in the same amount and on the same terms as he would be entitled to
hereunder if he is subject to a Good Reason, and the date on which any such
succession becomes effective shall be deemed the date of Termination.  As used in this Agreement, Company shall mean
Quixote as hereinbefore defined and any successor to the business and/or assets
of Quixote which executes and delivers the agreement provided for in this Section 12,
or which otherwise becomes bound by all the terms and provisions of this Agreement
by operation of law.

 

This Agreement and all
rights of the Executive hereunder shall inure to the benefit of, and be
enforceable by the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.  If the Executive should die after any amounts
shall become payable to him hereunder, all such amounts, unless otherwise
provided for herein, shall be paid in accordance with the terms of this Agreement
to the Executive’s devisee, 

 

6

 

legatee
or other designee or, if there be no such devisee or other designee, to the
Executive’s estate.

 

13.           Arbitration.  Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
in Chicago, Illinois in accordance with the American Arbitration Association
Employment Law Rules then in effect. 
The arbitrator is expressly empowered to render legal or equitable
relief requested by the parties, whether on an emergency basis or otherwise, in
order to enforce the terms of this Agreement. 
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction; provided, however, that the Executive shall be entitled to seek
specific performance of his right to be paid until the date of Termination
during the pendency of any dispute or controversy arising under or in
connection with this Agreement.  Nothing
in this Section 13 prohibits Quixote from seeking equitable or legal
relief in any appropriate court in order to enforce Sections 6 and 7 of this
Agreement.

 

14.           Counterparts.  This Agreement may be signed in any number of
counterparts and all such counterparts shall be read together and construed as
but one and the same document.

 

15.           Notices.  All notices and other communications under
this Agreement shall be in writing and shall be deemed given when delivered
personally, or sent by facsimile transmission, receipt confirmed, one day after
sent by recognized overnight courier, or five (5) days after deposit in
the United States mail, postage prepaid, registered or certified mail, return
receipt requested, to the parties at the following addresses (or to such other
address as a party may have specified by notice duly given to the other party
in accordance with this provision):

 

If to the Executive:

 

At the Executive’s then
current business or residence address as shown on the records of Quixote, with
a copy to such other person as the Executive may have specified by notice duly
given to Quixote in accordance with this provision.

 

If to Quixote:

 

Quixote Corporation

35 East Wacker Drive, 11th Floor

Chicago, IL  60601

Attention:  President

 

[Signature
page follows]

 

7

 

IN WITNESS WHEREOF, the parties
have executed this Agreement, in triplicate, on the date first written above.

 

 

	
  QUIXOTE CORPORATION

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Leslie J. Jezuit

  	
   

  	
  /s/ Daniel P. Gorey

  
	
  By: President

  	
   

  	
  Daniel P. Gorey

  

 

8

 

EXHIBIT A

 

Release
Agreement

 

This Release Agreement (“Agreement”) is entered into by and between
                            ,
an individual (“Executive”), and Quixote Corporation and its subsidiaries
(together, the “Company”), a Delaware corporation:

 

1.             Termination
of Employment. Executive acknowledges that Executive’s employment with the
Company terminated effective
                              ,
200   (the “Separation Date”).

 

2.             Compensation
owed. Executive acknowledges receipt of all compensation (including, but
not limited to, any and all overtime, commission, bonus payments and all other
benefits except accrued but unused vacation time) due from the Company through
the payroll period immediately prior to the Separation Date. Executive and the
Company acknowledge that Executive will receive a lump-sum payment equal to any
final compensation (including Executive’s accrued but unused vacation time 

of
                          
(    ) days) on the Company’s next regular payday.

 

3.             Separation
Benefit: Subject to the provisions of this Agreement, the Company will pay
Executive the benefits set forth in Section 2(a)(iv) of Executive’s
Severance and Non-Competition Agreement with the Company, but subject to Section 3
thereof (“Separation Benefit”), commencing within twenty-one (21) days of the
expiration  of the revocation period
described in Paragraph 16 of this Agreement. The Separation Benefit shall be
subject to all required payroll withholdings. The Separation Benefit does not
constitute nor is it intended to be any form of compensation to Executive for
any services to the Company.

 

4.             Consideration.
Executive acknowledges that Executive would not be entitled to the Separation
Benefit provided for in paragraph 3 above in the absence of Executive’s signing
of this Agreement, that the Separation Benefit constitutes a substantial
economic benefit to Executive, and that it constitutes good and valuable
consideration for the various commitments undertaken by Executive in this
Agreement.

 

5.             Parties
Released. For purposes of this Agreement, the term “Releasees” means the
Company, its past and present parents, subsidiaries, divisions, and affiliated
companies; their respective predecessors, successors, assigns, benefit plans,
and plan administrators; and their respective past and present shareholders,
directors, trustees, officers, employees, agents, attorneys and insurers.

 

6.             General
Release. Excepting the Company’s obligations pursuant to that Amended and
Restated Change of Control Agreement between the Company and the Executive
dated
                          ,
Executive, for and on behalf of Executive and each of Executive’s personal and
legal representatives, heirs, devisees, executors, successors and assigns,
hereby acknowledges full and complete satisfaction of, and fully and forever
waives, releases, acquits, and discharges Releasees from any and all claims,
causes of action, demands, liabilities, damages, obligations, and debts
(collectively referred to as “Claims”), of every kind and nature, whether known
or unknown, suspected or unsuspected, or fixed or contingent, which Executive
holds as of the date 

 

A-1

 

Executive signs this Agreement, or at any time previously held against
Releasees, or any of them, arising out of any matter whatsoever (with the
exception of breaches of this Agreement). This General Release specifically
includes, but is not limited to, any and all Claims:

 

(a)           Arising
out of or in any way related to Executive’s employment with the Company or the
termination of his employment;

 

(b)           Arising
out of or in any way related to any contract or agreement between Executive and
the Company, excepting the Severance and Non-Competition Agreement dated July     ,
2008;

 

(c)           Arising
under or based on the Equal Pay Act of 1963; Title VII of the Civil Rights Act
of 1964, as amended; Section 1981 of the Civil Rights Act of 1866; the
Americans With Disabilities Act of 1990; the Family and Medical Leave Act of
1993; the Fair Labor Standards Act of 1938; the National Labor Relations Act;
the Worker Adjustment and Retraining Notification Act of 1988; Employee
Retirement Income Security Act of 1974 (ERISA) (excepting claims for vested
benefits, if any, to which Executive is legally entitled thereunder); the Sarbanes-Oxley
Act of 2002; the Illinois Constitution; the Illinois Wage Payment and
Collection Act; the Illinois Minimum Wage Law, the Illinois Human Rights Act;
and the Illinois Whistleblower Act;

 

(d)           Arising
under or based on the Age Discrimination in Employment Act of 1967 (ADEA), as
amended by the Older Workers Benefit Protection Act (OWBPA), and alleging a
violation thereof based on any action or failure to act by Releasees, or any of
them, at any time prior to the effective date of this Agreement;  and

 

(e)           Arising
out of or in any way related to any federal, state, county or local
constitutional provision, law, statute, ordinance, decision, order, policy or
regulation prohibiting employment discrimination, providing for the payment of
wages or benefits, providing for a paid or unpaid leave of absence; otherwise
creating rights or claims for employees , including, but not limited to, any
and all claims alleging breach of public policy, whistleblowing, retaliation,
the implied obligation of good faith and fair dealing; any express or implied
oral or written contract, handbook, manual, policy statement or employment
practice; or alleging misrepresentation, defamation, libel, slander,
interference with contractual relations, intentional or negligent infliction of
emotional distress, invasion of privacy, false imprisonment, assault, battery;
fraud, negligence, or wrongful discharge.

 

7.             Intended
Scope of Release. It is the intention of the parties and is fully
understood and agreed by them that this Agreement includes a General Release of
all Claims (with the exception of (i) breaches of this Agreement, (ii) claims
for vested benefits, if any, to which Executive is legally entitled under
ERISA, and (iii) all obligations of the Company pursuant to that Amended
and Restated Change of Control Agreement between the Company and the Executive
dated
                        ,
2008), which Executive holds or previously held against Releasees, or any of
them, whether or not they are specifically referred to herein.  No reference herein to any specific claim,
statute or obligation is intended to limit the scope of this General Release
and, notwithstanding any such reference, and except as set forth in the
preceding sentence, this Agreement shall be effective as a full and final bar
to all Claims of every kind and 

 

A-2

 

nature, whether known or unknown, suspected or unsuspected, or fixed or
contingent, released in this Agreement.

 

8.             Executive
Waiver of Rights. As part of the foregoing General Release, Executive is
waiving all of Executive’s rights to any recovery, compensation, or other
legal, equitable or injunctive relief (including, but not limited to,
compensatory damages, liquidated damages, punitive damages, back pay, front
pay, attorneys’ fees, and reinstatement to employment), from Releasees, or any
of them, in any administrative, arbitral, judicial or other action brought by
or on behalf of Executive in connection with any Claim released in this
Agreement.

 

9.             Covenant
Not to Sue. In addition to all other obligations contained in this
Agreement, Executive agrees that Executive will not initiate, bring or
prosecute any suit or action against any of Releasees in any federal, state,
county or municipal court, with respect to any of the Claims released in this
Agreement. Notwithstanding the forgoing, nothing in this Agreement shall
preclude Executive from bringing suit to challenge the validity or
enforceability of this Agreement under the Age Discrimination in Employment Act
as amended by the Older Workers Benefit Protection Act.

 

10.           Remedies
for Breach. If the Executive, or anyone on Executive’s behalf, initiates,
brings or prosecutes any suit or action against Releasees, or any of them, in
any federal, state, county or municipal court, with respect to any of the
Claims released in this Agreement (except to challenge the validity or
enforceability of this Agreement under the Age Discrimination in Employment Act
as amended by the Older Workers Benefit Protection Act), or if the Executive
breaches any of the terms of this Agreement, then Executive shall  be liable for the payment of all damages,
costs and expenses (including attorneys’ fees) incurred by Releasees, or any of
them, in connection with such suit, action or breach.

 

11.           No
Admission of Liability. Nothing in this Agreement constitutes or shall be
construed as an admission of liability on the part of Releasees, or any of
them. Releasees expressly deny any liability of any kind to Executive, and
particularly any liability arising out of or in any way related to Executive’s
employment with the Company or the termination of Executive’s employment.

 

12.           Post-Employment
Covenants.

 

(a)   Executive
hereby reaffirms and agrees to abide by all confidentiality and nondisclosure
obligations, nonsolicitation obligations, noncompetition obligations and any
other post-employment obligations to which Executive is subject under any
contract or agreement between Executive and the Company as well as the Illinois
Trade Secrets Act, any other Illinois statute and Illinois common law.

 

[(b)  Executive shall keep confidential
the circumstances surrounding the termination of Executive’s employment with
the Company, as well as the existence of this Agreement and its terms, and
agrees that neither he, nor Executive’s attorneys, nor any of Executive’s
agents, shall directly or indirectly disclose any such matters (other than to
the Equal Employment Opportunity Commission, the Illinois Human Rights
Commission, or any other federal, state or local fair employment practices
agency), unless written consent is given by the Company’s Chief Executive
Officer or other 

 

A-3

 

authorized officer of the Company, or unless
required to comply with any federal, state or local law, rule or order.
However, this paragraph will not prohibit Executive from disclosing the terms
of this Agreement to Executive’s attorneys, accountants or other tax
consultants as necessary for the purpose of securing their professional advice,
or in connection with any suit or action alleging a breach of this Agreement.]

 

(c)  Executive agrees that Executive
will not access or attempt to access, directly or indirectly, by any matter
whatsoever, the Company’s computer network, including without limitation, the
Company’s e-mail system, the Company’s electronic document storage and
retrieval system, and the Company’s computer network servers and related
equipment.

 

(d)  Executive agrees that fifty percent
(50%) of the Separation Benefit shall be considered consideration for the
covenants of Executive in Section 7 of the Executive’s Severance Agreement
with the Company, and such portion may be recovered from Executive by the
Company as provided in the Severance Agreement in the event of the Executive’s
breach of any such covenants.

 

13.           Warranty
of Return of Company Property. Executive warrants and acknowledges that
Executive has turned over to the Company all equipment or other property issued
to Executive’s by the Company, along with all documents, notes, computer files,
and other materials which Executive had in Executive’s possession or subject to
Executive’s control, relating to the Company and/or any of its customers.
Executive further warrants and acknowledges that Executive has not retained any
such documents, notes, computer files or other materials (including any copies
or duplicates thereof).

 

14.           Warranty
and Covenant of Nondisparagement. Executive (i) warrants that during
the time period between when Executive was notified of the termination of
Executive’s employment with the Company and Executive’s signing of this
Agreement Executive has not made any disparaging remarks about Releasees which
are likely to cause harm to Releasees, collectively or individually, or their
products and services (“Disparaging Remarks”) and (ii) agrees that
Executive shall not make any Disparaging Remarks following Executive’s signing
of this Agreement.

 

15.           Consideration
Period. Executive is advised of to consult with an attorney or other
representative of Executive’s choice prior to signing this Agreement. Executive
has a period of
                                
{twenty-one (21)/forty-five (45)} days
within which to consider and accept the Agreement (“Consideration Period”). The
Consideration Period begins to run from the Separation Date which Executive
acknowledges is the date on which Executive received a copy of this Agreement
(if not earlier).

 

16.           Revocation
Period. Executive understands that Executive has the right to revoke this
Agreement at any time within seven (7) days after Executive signs it and
that the Agreement shall not become effective or enforceable until this
revocation period has expired without revocation.

 

17.           Resignation
of Officer Position. If applicable, Executive shall resign from Executive’s
position as an officer of the Company effective no later than the Separation
Date.

 

A-4

 

18.           Warranty
of Understanding and Voluntary Nature of Agreement. Executive acknowledges
that Executive has carefully read and fully understands all of the provisions
of this Agreement; that Executive knows and understands the rights Executive is
waiving by signing this Agreement; and that Executive has entered into the
Agreement knowingly and voluntarily, without coercion, duress or overreaching
of any sort.

 

19.           Severability.
The provisions of this Agreement are fully severable. Therefore, if any
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such invalidity or unenforceability will not affect the validity
or enforceability of any of the remaining provisions. Furthermore, any invalid
or unenforceable provisions shall be modified or restricted to the extent and
in the manner necessary to render the same valid and enforceable, or, if such
provision cannot under any circumstances be modified or restricted, it shall be
excised from the Agreement without affecting the validity or enforceability of
any of the remaining provisions. The parties agree that any such modification,
restriction or excision may be accomplished by their mutual written agreement
or, alternatively, by disposition of a court or other tribunal.

 

20.           Entire
Agreement/Integration. This Agreement constitutes the sole and entire
agreement between Executive and the Company with respect to the subjects
addressed in it, and supersedes all prior or contemporaneous agreements,
understandings, and representations, oral and written, with respect to those
subjects.

 

21.           No
Waiver By the Company. No waiver, modification or amendment of any of the
provisions of this Agreement shall be valid and enforceable unless in writing
and executed by Executive and the Company’s Chief Executive Officer or other
authorized officer of the Company.

 

22.           Successors
and Assigns. This Agreement shall be binding upon, and shall inure to the
benefit of, Executive and Executive’s personal and legal representatives,
heirs, devisees, executors, successors and assigns, and the Company and its
successors and assigns.

 

23.           Choice
of Law. This Agreement and any amendments hereto shall be governed by and
construed in accordance with the laws of the State of Illinois, without regard
to conflicts of law principles.

 

	
  COMPANY:

  	
   

  	
  EMPLOYEE:

  
	
  QUIXOTE CORPORATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By: 

  	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  	
   

  	
  {Insert Name}

  
						

 

A-5Exhibit 10.6

 

SEVERANCE AND
NON-COMPETITION AGREEMENT

 

THIS SEVERANCE AND
NON-COMPETITION AGREEMENT, dated as of July 25, 2008 (the “Agreement”), is
by and between Quixote Corporation, a Delaware corporation having its principal
offices at 35 East Wacker Drive, Chicago, IL 60601 (“Quixote”), and Joan
R. Riley, an Executive of the Company (“Executive”).

 

WHEREAS, the Executive is a
key employee of Quixote who possesses valuable proprietary knowledge of
Quixote, its business and operations and the markets in which Quixote competes;
and

 

WHEREAS, the Board of
Directors of Quixote (the “Board”) has recognized and continues to recognize
that the Executive’s contribution to the growth and success of Quixote has
been, and is expected to continue to be, substantial and desires to assure
Quixote of the Executive’s continued employment by assuring her of fair
treatment if that relationship is terminated; and

 

NOW, THEREFORE, in
consideration of the foregoing, the mutual covenants and conditions contained
herein and other good and valuable consideration, the receipt and sufficiency
of which is hereby acknowledged, the parties hereto agree as follows:

 

1.             Certain Defined Terms.

 

(a)           Good Reason.  “Good Reason” shall mean either of the events
described in (i) and (ii) of this subsection 1(a) occurring
without the Executive’s written consent. 
The Executive’s termination of employment hereunder shall not be treated
as a termination for Good Reason unless (1) the Executive provides notice
to Quixote of the existence of the Good Reason no later than sixty (60) days
after the occurrence of the event which forms the basis for any termination for
Good Reason, and (2) Quixote fails to remedy the Good Reason within thirty
(30) days after receipt of notice from the Executive of the existence of the
Good Reason (the “Cure Period”), and (3) the Executive tenders her
resignation in writing to Quixote within fifteen (15) days after end of the
Cure Period:

 

	
  (i)

  	
   

  	
  the Executive’s base compensation and fringe benefits are reduced, in
  the aggregate, by 20% or more; or

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Quixote fails to obtain the assumption of the obligation to perform
  this Agreement by any successor as contemplated in Section 12 hereof.

  

 

(b)           Cause.  Quixote shall have “Cause” to terminate the
Executive’s employment upon:

 

 

	
  (i)

  	
   

  	
  the willful failure by the Executive to substantially perform her
  duties, other than when such failure resulting from the Executive’s
  incapacity is due to physical or mental illness;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  the willful engaging by the Executive in gross misconduct materially
  and demonstrably injurious to Quixote or its subsidiaries; or

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  the commission by the Executive of a crime which is a felony.

  

 

For the purpose of this subsection (b), no act, or the failure to act,
on the Executive’s part shall be considered “willful” unless done, or omitted
to be done, by her not in good faith and without reasonable belief that her
action or omission was in the best interest of 
Quixote or its subsidiaries.

 

(c)           Disability.  An Executive’s “Disability” shall occur if
the Executive is absent from her duties as an Executive of Quixote on a
full-time basis for six (6) consecutive months and if she 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)

  	
   

  	
  Her 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 

 

2

 

forth in Paragraph 15 of the Release, Executive will not receive the
payments provided in Section 2(a)(iv) above.

 

(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 the Executive’s death; provided however, Quixote shall immediately upon Termination pay such
amounts described in this Section 3 into a domestic “rabbi trust” to be
held by a mutually-acceptable bank or other third party until the Executive is
entitled to receive such payments.

 

4.             Mitigation.  The Executive shall not be required to
mitigate the amount of any payment provided for in this Agreement by seeking
other employment or otherwise, nor shall the amount of any payment provided for
in this Agreement be reduced by any compensation earned by the Executive as a
result of employment by another employer after the date of Termination, or
otherwise.

 

5.             At-Will Employment.  Notwithstanding this Agreement, Executive’s
relationship with Quixote continues to be an at-will employment
relationship.  Quixote or Executive has
the right to terminate Executive’s employment with Quixote at any time with or
without Cause and with or without notice. 
Nothing in this Agreement confers upon the Executive any right to
continue in the employ of Quixote, or in any way limits the rights of Quixote,
except as expressly stated herein, to discharge the Executive at any time for
any reason whatsoever, with or without cause.

 

6.             Confidential Information.  The Executive shall at all times hold in a
fiduciary capacity for the benefit of Quixote all secret, confidential or
proprietary information, knowledge or data relating to Quixote and its
respective businesses, which shall have been obtained by the Executive during
the Executive’s employment by Quixote and which shall not be or become public
knowledge including, but not limited to, information regarding the technology,
proprietary methodologies and products, software, other trade secrets, clients,
suppliers, customers, consultants and agents of Quixote (the “Confidential
Information”).  During the Executive’s
employment with Quixote and after Termination of such employment at any time or
for any reason, and regardless of whether any payments are made to the
Executive under this Agreement as a result of such termination, the Executive
shall not, without the prior written consent of 

 

3

 

Quixote or as may otherwise be required by
law or legal process, communicate or divulge any Confidential Information to
any person other than Quixote and those designated by it or use any
Confidential Information except for the benefit of Quixote.  Immediately upon Termination of the Executive’s
employment with Quixote at any time or for any reason, the Executive shall
return to Quixote all Confidential Information, including, but not limited to,
any and all copies, reproductions, notes or extracts of Confidential
Information.  The terms of this Section 6
shall be in addition to, and not a replacement of, the provisions of any
Executive confidentiality or inventions agreement with Executive.

 

7.             Non-Competition.

 

(a)           Solicitation of Employees.  During the Executive’s employment with
Quixote and for a period of twelve (12) months after termination of such
employment at any time and for any reason, and regardless of whether any
payments are made to the Executive under this Agreement as a result of such
Termination, the Executive shall not solicit, participate in or promote  the solicitation of any person who was
employed by Quixote at the time of the Executive’s Termination of employment
with Quixote to leave the employ of Quixote or its subsidiaries, or, on behalf
of herself or any other person, hire, employ or engage any such person;
provided however that the foregoing restriction shall not prohibit Executive or
a firm with which she is employed or affiliated from (i) publishing and
receiving responses to a general solicitation for employment in a general
circulation newspaper, magazine, website or similar medium, or (ii) hiring
a former employee of Quixote who has not been employed by Quixote or its
subsidiaries for a period of at least six (6) months.  The Executive further agrees that, during
such twelve (12) month period, if a current employee of Quixote contacts the
Executive about prospective employment, the Executive will inform such employee
that she cannot discuss the matter further without informing Quixote.

 

(b)           Covenants During Employment.  During the Executive’s employment, the
Executive will not compete with Quixote anywhere that Quixote conducts its
business.  In accordance with this
restriction, but without limiting its terms, during the Executive’s employment,
the Executive will not:

 

	
  (i)

  	
   

  	
  Enter into or engage in any business which competes with the business
  of Quixote or its subsidiaries;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Solicit customers, business, patronage or orders for, or sell, any
  products and services in competition with, or for any business that competes
  with, the business of Quixote or its subsidiaries;

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Divert, entice or otherwise take away any customers, business,
  patronage or orders of Quixote or its subsidiaries or attempt to do so; or

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Promote or assist, financially or otherwise, any person, firm, association,
  partnership, corporation or other entity engaged in any business which
  competes with the business of Quixote or its subsidiaries.

  

 

4

 

(c)           Covenants Following
Termination.  For a
period of one (1) year following the Termination of the Executive’s
employment, the Executive will not:

 

	
  (i)

  	
   

  	
  Enter into or engage in any business which competes with the business
  of Quixote or its subsidiaries in any country where Quixote or its
  subsidiaries are doing business as of the date of Termination;

  
	
   

  	
   

  	
   

  
	
  (ii)

  	
   

  	
  Solicit customers, business, patronage or orders for, or sell, any
  products and services in competition with, or for any business, wherever
  located, that competes with the business of Quixote or its subsidiaries in
  any country where Quixote or its subsidiaries are doing business as of the
  date of Termination;

  
	
   

  	
   

  	
   

  
	
  (iii)

  	
   

  	
  Divert, entice or otherwise take away any customers, business,
  patronage or orders of Quixote in any country where Quixote or its
  subsidiaries are doing business as of the date of Termination, or attempt to
  do so; or

  
	
   

  	
   

  	
   

  
	
  (iv)

  	
   

  	
  Promote or assist, financially or otherwise, any person, firm,
  association, partnership, corporation or other entity engaged in any business
  which competes with Quixote or its subsidiaries in any country where Quixote
  is doing business as of the date of Termination.

  

 

(d)           Indirect Competition.  For the purposes of Sections 7(b) and
7(c), but without limitation thereof, the Executive will be in violation
thereof if the Executive engages in any or all of the activities set forth
therein directly as an individual on the Executive’s own account, or indirectly
as a general partner, joint venturer, employee, agent, salesperson, consultant,
officer and/or director of any firm, association, partnership, corporation or
other entity, or as a limited partner, member or stockholder of any limited
partnership, limited liability company, or corporation in which the Executive
or the Executive’s spouse, child or parent owns, directly or indirectly,
individually or in the aggregate, more than five percent (5%) of the limited
partnership interests, limited liability company interests or outstanding
stock, as the case may be.

 

(e)           Application of Restrictions
Respecting Confidential Information, Solicitation and Competition.  The requirements and obligations of the
Executive under Section 7 shall be in addition to, and not a limitation
under, any other requirements and obligations of the Executive, at law or
otherwise.

 

(f)            Consideration.  The parties agree that for all purposes of
this Agreement and otherwise, Executive’s continued employment with Quixote and
Quixote’s continued provision of confidential information to Executive are
sufficient consideration for this Section 7.  In addition, to the extent that Quixote has
an obligation to pay the Separation Benefit under the Agreement, fifty percent
(50%) of the Separation Benefit hereunder, or an aggregate amount equal to
fifty percent (50%) of such Separation Benefit paid hereunder (to the extent the
Separation Benefit is paid in installments), shall be considered the
consideration payable to Executive for the covenants in this Section 7
(the “Noncompetition Consideration”), and if the 

 

5

 

Executive violates any of the covenants set forth in this Section 7,
then in addition to and not in limitation of any of its remedies hereunder or
under applicable law, Quixote shall have the right to refrain from making any
further installments of the Separation Benefit and may recover from Executive
any amounts of the Separation Benefit paid to Executive to date up to the
amount of the Noncompetition Consideration. 
The parties further agree that the allocation of a portion of the
Separation Benefit as described above shall not be interpreted as granting to
Executive any right to receive additional amounts hereunder.

 

8.             Rights Apply Only on
Termination.  The rights
granted under this Severance and Non-Competition Agreement only apply upon a
Termination.

 

9.             Governing Law.  This Agreement shall be governed by and
construed in accordance with the laws of the State of Illinois applicable to
agreements made and to be performed in Illinois, without giving effect to
conflicts of law principles.

 

10.           Headings; Severability.  The section headings of this Agreement are
for reference only and are to be given no effect in the construction or
interpretation of this Agreement.  If any
part or provision of this Agreement shall be declared invalid or unenforceable
by a court of competent jurisdiction, said provision or part shall be
ineffective to the extent of such invalidity or unenforceability only, without
in any way affecting the remaining parts or provisions of this Agreement.

 

11.           Waiver.  Any party may waive compliance by another
party with any of the provisions of this Agreement.  No waiver of any provision shall be construed
as a waiver of any other provision.  Any
waiver must be in writing.

 

12.           Binding Effect; Assignment.  This Agreement shall be binding on and inure
to the benefit of the parties and their respective successors and permitted
assigns.  Nothing in this Agreement shall
create or be deemed to create any third party beneficiary rights in any person
or entity (including any Executive or person engaged by Quixote in any
capacity) not a party to this Agreement. 
Quixote will require any successor (whether direct or indirect, by
merger, purchase, consolidation or otherwise) of Quixote to make an express
assumption of the obligations hereunder and cause any successor (whether direct
or indirect, by merger, purchase, consolidation or otherwise) to all or
substantially all of the business and/or assets of Quixote to agree to perform
all parts and provisions under this Agreement in the same manner and to the
same extent that Quixote would be required to perform it if no such succession
had taken place.  Failure of Quixote to
obtain such agreement prior to the effectiveness of any such succession shall
be a breach of this Agreement and shall entitle Executive to compensation from
Quixote in the same amount and on the same terms as she would be entitled to
hereunder if she is subject to a Good Reason, and the date on which any such
succession becomes effective shall be deemed the date of Termination.  As used in this Agreement, Company shall mean
Quixote as hereinbefore defined and any successor to the business and/or assets
of Quixote which executes and delivers the agreement provided for in this Section 12,
or which otherwise becomes bound by all the terms and provisions of this
Agreement by operation of law.

 

This Agreement and all
rights of the Executive hereunder shall inure to the benefit of, and be
enforceable by the Executive’s personal or legal representatives, executors,
administrators, successors, heirs, distributees, devisees and legatees.  If the Executive should die after any 

 

6

 

amounts shall become payable
to her hereunder, all such amounts, unless otherwise provided for herein, shall
be paid in accordance with the terms of this Agreement to the Executive’s
devisee, legatee or other designee or, if there be no such devisee or other
designee, to the Executive’s estate.

 

13.           Arbitration.  Any dispute or controversy arising under or
in connection with this Agreement shall be settled exclusively by arbitration
in Chicago, Illinois in accordance with the American Arbitration Association
Employment Law Rules then in effect. 
The arbitrator is expressly empowered to render legal or equitable
relief requested by the parties, whether on an emergency basis or otherwise, in
order to enforce the terms of this Agreement. 
Judgment may be entered on the arbitrator’s award in any court having
jurisdiction; provided, however, that the Executive shall be entitled to seek
specific performance of her right to be paid until the date of Termination
during the pendency of any dispute or controversy arising under or in
connection with this Agreement.  Nothing
in this Section 13 prohibits Quixote from seeking equitable or legal
relief in any appropriate court in order to enforce Sections 6 and 7 of this
Agreement.

 

14.           Counterparts.  This Agreement may be signed in any number of
counterparts and all such counterparts shall be read together and construed as
but one and the same document.

 

15.           Notices.  All notices and other communications under
this Agreement shall be in writing and shall be deemed given when delivered
personally, or sent by facsimile transmission, receipt confirmed, one day after
sent by recognized overnight courier, or five (5) days after deposit in
the United States mail, postage prepaid, registered or certified mail, return
receipt requested, to the parties at the following addresses (or to such other
address as a party may have specified by notice duly given to the other party
in accordance with this provision):

 

If to the Executive:

 

At the Executive’s then
current business or residence address as shown on the records of Quixote, with
a copy to such other person as the Executive may have specified by notice duly
given to Quixote in accordance with this provision.

 

If to Quixote:

 

Quixote Corporation

35 East Wacker Drive, 11th Floor

Chicago, IL  60601

Attention:  President

 

[Signature
page follows]

 

7

 

IN WITNESS WHEREOF, the parties
have executed this Agreement, in triplicate, on the date first written above.

 

 

	
  QUIXOTE CORPORATION

  	
   

  	
  EXECUTIVE

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Leslie J. Jezuit

  	
   

  	
  /s/ Joan R. Riley

  
	
  By: President

  	
   

  	
  Joan R. Riley

  

 

8

 

EXHIBIT A

 

Release
Agreement

 

This Release Agreement (“Agreement”) is entered into by and between
                            ,
an individual (“Executive”), and Quixote Corporation and its subsidiaries
(together, the “Company”), a Delaware corporation:

 

1.             Termination
of Employment. Executive acknowledges that Executive’s employment with the
Company terminated effective
                              ,
200   (the “Separation Date”).

 

2.             Compensation
owed. Executive acknowledges receipt of all compensation (including, but
not limited to, any and all overtime, commission, bonus payments and all other
benefits except accrued but unused vacation time) due from the Company through
the payroll period immediately prior to the Separation Date. Executive and the
Company acknowledge that Executive will receive a lump-sum payment equal to any
final compensation (including Executive’s accrued but unused vacation time 

of
                          
(    ) days) on the Company’s next regular payday.

 

3.             Separation
Benefit: Subject to the provisions of this Agreement, the Company will pay
Executive the benefits set forth in Section 2(a)(iv) of Executive’s
Severance and Non-Competition Agreement with the Company, but subject to Section 3
thereof (“Separation Benefit”), commencing within twenty-one (21) days of the
expiration  of the revocation period
described in Paragraph 16 of this Agreement. The Separation Benefit shall be
subject to all required payroll withholdings. The Separation Benefit does not
constitute nor is it intended to be any form of compensation to Executive for
any services to the Company.

 

4.             Consideration.
Executive acknowledges that Executive would not be entitled to the Separation
Benefit provided for in paragraph 3 above in the absence of Executive’s signing
of this Agreement, that the Separation Benefit constitutes a substantial
economic benefit to Executive, and that it constitutes good and valuable
consideration for the various commitments undertaken by Executive in this
Agreement.

 

5.             Parties
Released. For purposes of this Agreement, the term “Releasees” means the
Company, its past and present parents, subsidiaries, divisions, and affiliated
companies; their respective predecessors, successors, assigns, benefit plans,
and plan administrators; and their respective past and present shareholders,
directors, trustees, officers, employees, agents, attorneys and insurers.

 

6.             General
Release. Excepting the Company’s obligations pursuant to that Amended and
Restated Change of Control Agreement between the Company and the Executive
dated
                          ,
Executive, for and on behalf of Executive and each of Executive’s personal and
legal representatives, heirs, devisees, executors, successors and assigns,
hereby acknowledges full and complete satisfaction of, and fully and forever
waives, releases, acquits, and discharges Releasees from any and all claims,
causes of action, demands, liabilities, damages, obligations, and debts
(collectively referred to as “Claims”), of every kind and nature, whether known
or unknown, suspected or unsuspected, or fixed or contingent, which Executive
holds as of the date 

 

A-1

 

Executive signs this Agreement, or at any time previously held against
Releasees, or any of them, arising out of any matter whatsoever (with the
exception of breaches of this Agreement). This General Release specifically
includes, but is not limited to, any and all Claims:

 

(a)           Arising
out of or in any way related to Executive’s employment with the Company or the
termination of her employment;

 

(b)           Arising
out of or in any way related to any contract or agreement between Executive and
the Company, excepting the Severance and Non-Competition Agreement dated July     ,
2008;

 

(c)           Arising
under or based on the Equal Pay Act of 1963; Title VII of the Civil Rights Act
of 1964, as amended; Section 1981 of the Civil Rights Act of 1866; the
Americans With Disabilities Act of 1990; the Family and Medical Leave Act of
1993; the Fair Labor Standards Act of 1938; the National Labor Relations Act;
the Worker Adjustment and Retraining Notification Act of 1988; Employee
Retirement Income Security Act of 1974 (ERISA) (excepting claims for vested
benefits, if any, to which Executive is legally entitled thereunder); the Sarbanes-Oxley
Act of 2002; the Illinois Constitution; the Illinois Wage Payment and
Collection Act; the Illinois Minimum Wage Law, the Illinois Human Rights Act;
and the Illinois Whistleblower Act;

 

(d)           Arising
under or based on the Age Discrimination in Employment Act of 1967 (ADEA), as
amended by the Older Workers Benefit Protection Act (OWBPA), and alleging a
violation thereof based on any action or failure to act by Releasees, or any of
them, at any time prior to the effective date of this Agreement;  and

 

(e)           Arising
out of or in any way related to any federal, state, county or local
constitutional provision, law, statute, ordinance, decision, order, policy or
regulation prohibiting employment discrimination, providing for the payment of
wages or benefits, providing for a paid or unpaid leave of absence; otherwise
creating rights or claims for employees, including, but not limited to, any and
all claims alleging breach of public policy, whistleblowing, retaliation, the
implied obligation of good faith and fair dealing; any express or implied oral
or written contract, handbook, manual, policy statement or employment practice;
or alleging misrepresentation, defamation, libel, slander, interference with
contractual relations, intentional or negligent infliction of emotional
distress, invasion of privacy, false imprisonment, assault, battery; fraud,
negligence, or wrongful discharge.

 

7.             Intended
Scope of Release. It is the intention of the parties and is fully
understood and agreed by them that this Agreement includes a General Release of
all Claims (with the exception of (i) breaches of this Agreement, (ii) claims
for vested benefits, if any, to which Executive is legally entitled under
ERISA, and (iii) all obligations of the Company pursuant to that Amended
and Restated Change of Control Agreement between the Company and the Executive
dated
                        ,
2008), which Executive holds or previously held against Releasees, or any of
them, whether or not they are specifically referred to herein.  No reference herein to any specific claim,
statute or obligation is intended to limit the scope of this General Release
and, notwithstanding any such reference, and except as set forth in the
preceding sentence, this Agreement shall be effective as a full and final bar
to all Claims of every kind and 

 

A-2

 

nature, whether known or unknown, suspected or unsuspected, or fixed or
contingent, released in this Agreement.

 

8.             Executive
Waiver of Rights. As part of the foregoing General Release, Executive is
waiving all of Executive’s rights to any recovery, compensation, or other
legal, equitable or injunctive relief (including, but not limited to,
compensatory damages, liquidated damages, punitive damages, back pay, front
pay, attorneys’ fees, and reinstatement to employment), from Releasees, or any
of them, in any administrative, arbitral, judicial or other action brought by
or on behalf of Executive in connection with any Claim released in this
Agreement.

 

9.             Covenant
Not to Sue. In addition to all other obligations contained in this
Agreement, Executive agrees that Executive will not initiate, bring or
prosecute any suit or action against any of Releasees in any federal, state,
county or municipal court, with respect to any of the Claims released in this
Agreement. Notwithstanding the forgoing, nothing in this Agreement shall
preclude Executive from bringing suit to challenge the validity or
enforceability of this Agreement under the Age Discrimination in Employment Act
as amended by the Older Workers Benefit Protection Act.

 

10.           Remedies
for Breach. If the Executive, or anyone on Executive’s behalf, initiates,
brings or prosecutes any suit or action against Releasees, or any of them, in
any federal, state, county or municipal court, with respect to any of the
Claims released in this Agreement (except to challenge the validity or
enforceability of this Agreement under the Age Discrimination in Employment Act
as amended by the Older Workers Benefit Protection Act), or if the Executive
breaches any of the terms of this Agreement, then Executive shall  be liable for the payment of all damages,
costs and expenses (including attorneys’ fees) incurred by Releasees, or any of
them, in connection with such suit, action or breach.

 

11.           No
Admission of Liability. Nothing in this Agreement constitutes or shall be
construed as an admission of liability on the part of Releasees, or any of
them. Releasees expressly deny any liability of any kind to Executive, and
particularly any liability arising out of or in any way related to Executive’s
employment with the Company or the termination of Executive’s employment.

 

12.           Post-Employment
Covenants.

 

(a)   Executive
hereby reaffirms and agrees to abide by all confidentiality and nondisclosure
obligations, nonsolicitation obligations, noncompetition obligations and any
other post-employment obligations to which Executive is subject under any
contract or agreement between Executive and the Company as well as the Illinois
Trade Secrets Act, any other Illinois statute and Illinois common law.

 

[(b)  Executive shall keep confidential
the circumstances surrounding the termination of Executive’s employment with
the Company, as well as the existence of this Agreement and its terms, and
agrees that neither he, nor Executive’s attorneys, nor any of Executive’s
agents, shall directly or indirectly disclose any such matters (other than to
the Equal Employment Opportunity Commission, the Illinois Human Rights
Commission, or any other federal, state or local fair employment practices
agency), unless written consent is given by the Company’s Chief Executive
Officer or other 

 

A-3

 

authorized officer of the Company, or unless
required to comply with any federal, state or local law, rule or order.
However, this paragraph will not prohibit Executive from disclosing the terms
of this Agreement to Executive’s attorneys, accountants or other tax
consultants as necessary for the purpose of securing their professional advice,
or in connection with any suit or action alleging a breach of this Agreement.]

 

(c)  Executive agrees that Executive
will not access or attempt to access, directly or indirectly, by any matter
whatsoever, the Company’s computer network, including without limitation, the
Company’s e-mail system, the Company’s electronic document storage and
retrieval system, and the Company’s computer network servers and related
equipment.

 

(d)           Executive agrees that fifty percent (50%) of
the Separation Benefit shall be considered consideration for the covenants of
Executive in Section 7 of the Executive’s Severance Agreement with the
Company, and such portion may be recovered from Executive by the Company as
provided in the Severance Agreement in the event of the Executive’s breach of
any such covenants.

 

13.           Warranty
of Return of Company Property. Executive warrants and acknowledges that
Executive has turned over to the Company all equipment or other property issued
to Executive’s by the Company, along with all documents, notes, computer files,
and other materials which Executive had in Executive’s possession or subject to
Executive’s control, relating to the Company and/or any of its customers.
Executive further warrants and acknowledges that Executive has not retained any
such documents, notes, computer files or other materials (including any copies
or duplicates thereof).

 

14.           Warranty
and Covenant of Nondisparagement. Executive (i) warrants that during
the time period between when Executive was notified of the termination of
Executive’s employment with the Company and Executive’s signing of this
Agreement Executive has not made any disparaging remarks about Releasees which
are likely to cause harm to Releasees, collectively or individually, or their
products and services (“Disparaging Remarks”) and (ii) agrees that
Executive shall not make any Disparaging Remarks following Executive’s signing
of this Agreement.

 

15.           Consideration
Period. Executive is advised of to consult with an attorney or other
representative of Executive’s choice prior to signing this Agreement. Executive
has a period of
                                
{twenty-one (21)/forty-five (45)} days
within which to consider and accept the Agreement (“Consideration Period”). The
Consideration Period begins to run from the Separation Date which Executive
acknowledges is the date on which Executive received a copy of this Agreement
(if not earlier).

 

16.           Revocation
Period. Executive understands that Executive has the right to revoke this
Agreement at any time within seven (7) days after Executive signs it and
that the Agreement shall not become effective or enforceable until this
revocation period has expired without revocation.

 

17.           Resignation
of Officer Position. If applicable, Executive shall resign from Executive’s
position as an officer of the Company effective no later than the Separation
Date.

 

A-4

 

18.           Warranty
of Understanding and Voluntary Nature of Agreement. Executive acknowledges
that Executive has carefully read and fully understands all of the provisions
of this Agreement; that Executive knows and understands the rights Executive is
waiving by signing this Agreement; and that Executive has entered into the
Agreement knowingly and voluntarily, without coercion, duress or overreaching
of any sort.

 

19.           Severability.
The provisions of this Agreement are fully severable. Therefore, if any
provision of this Agreement is for any reason determined to be invalid or
unenforceable, such invalidity or unenforceability will not affect the validity
or enforceability of any of the remaining provisions. Furthermore, any invalid
or unenforceable provisions shall be modified or restricted to the extent and
in the manner necessary to render the same valid and enforceable, or, if such
provision cannot under any circumstances be modified or restricted, it shall be
excised from the Agreement without affecting the validity or enforceability of
any of the remaining provisions. The parties agree that any such modification,
restriction or excision may be accomplished by their mutual written agreement
or, alternatively, by disposition of a court or other tribunal.

 

20.           Entire
Agreement/Integration. This Agreement constitutes the sole and entire
agreement between Executive and the Company with respect to the subjects
addressed in it, and supersedes all prior or contemporaneous agreements,
understandings, and representations, oral and written, with respect to those
subjects.

 

21.           No
Waiver By the Company. No waiver, modification or amendment of any of the
provisions of this Agreement shall be valid and enforceable unless in writing
and executed by Executive and the Company’s Chief Executive Officer or other
authorized officer of the Company.

 

22.           Successors
and Assigns. This Agreement shall be binding upon, and shall inure to the
benefit of, Executive and Executive’s personal and legal representatives,
heirs, devisees, executors, successors and assigns, and the Company and its
successors and assigns.

 

23.           Choice
of Law. This Agreement and any amendments hereto shall be governed by and
construed in accordance with the laws of the State of Illinois, without regard
to conflicts of law principles.

 

	
  COMPANY:

  	
   

  	
  EMPLOYEE:

  
	
  QUIXOTE CORPORATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  	
   

  	
   

  	
  {Insert Name}

  
								

 

A-5

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