Document:

EXHIBIT
10(c)

 

DIRECTOR NONQUALIFIED STOCK OPTION

 

This DIRECTOR NONQUALIFIED STOCK
OPTION is granted as of this     th day
of                               by
QUIXOTE CORPORATION, a Delaware corporation whose principal place of business
is located in Chicago, Illinois (“Quixote”), to                              (“Director”).

 

W
I T N E S S E T H:

 

WHEREAS, on August 16, 2001 the Board
of Directors of Quixote adopted a stock option plan for its directors known as
the “2001 Non-Employee Directors Stock Option Plan” (the “Director Plan”), and
the stockholders of Quixote approved the adoption of the Director Plan on
November 14, 2001; and

 

WHEREAS, on August 17, 2004 the Board
of Directors of Quixote adopted an amendment to the Director Plan which was
approved by the stockholders on November 18, 2004; and

 

WHEREAS,
Director has satisfied the terms of the Director Plan and is entitled to obtain
an option to purchase shares of Quixote’s common stock;

 

NOW,
THEREFORE, this document reflects the terms of the grant of an option to the
Director under the Director Plan and all initially-capitilized terms not
defined herein shall have the same meaning as in the Director Plan.

 

1.          Grant of Option.   Subject to the terms and conditions
contained herein and in the Director Plan, Quixote hereby grants to Director an
option (“Option”) to purchase 5,000 shares of Quixote common stock, par value
$.01-2/3 (the “Stock”), to be issued as fully paid and non-assessable upon the
exercise hereof and payment therefor, during the period beginning on          [six
months from the date hereof] and
terminating          [seven
years from the date hereof] (such period is hereinafter referred to as the “Term”).  Notwithstanding anything herein to the
contrary, and except as provided in paragraph 4 hereof, the Option and all
rights granted herein shall terminate and become null and void upon the
expiration of seven (7) years from the date hereof.  The Option will not be treated as an “Incentive
Stock Option” as defined in Section 422A of the Internal Revenue Code of 1986.

 

2.          Exercise of Option.  The Option may be exercised by written notice
delivered to the Chief Financial Officer of Quixote at 35 East Wacker Drive,
Chicago, Illinois 60601, stating that Director desires to exercise the Option
to purchase a specific number of shares, which shall not be less than fifty
(50) shares, with respect to which the Option is being exercised.  In no case may the Option be exercised for a
fraction of a share of Stock.  The
purchase price identified in paragraph 3 for the Stock with respect to which
the Option is being exercised shall be paid in any one or any combination of
the following: (i) in cash, or (ii) by delivering Stock already owned by

 

 

Director for at least six months prior to such exercise.
Promptly after receipt of written notice and payment, Quixote shall deliver to
Director a certificate representing the shares of Stock purchased.  If any law or regulation requires Quixote to
take any action with respect to the shares of Stock, then the date for the
delivery of such Stock shall be extended for the period necessary to take such
action.

 

3.          Option Price.  The Option purchase price of the Stock shall
be $           per share,
which price is not less than 100% of the Fair Market Value of the Stock, as
computed under the Director Plan.

 

4.          Conditions Upon Right to Exercise.

 

(a)  Cessation of Services.  Upon cessation of Director’s service as a
Director for a reason other than death, the Option, to the extent it is
immediately exercisable on the date of the cessation of services, may be
exercised by Director at any time or times in whole or in part until the close
of business on the day before the same day of the third month after the
Director’s cessation of service; provided  however, this extension
of the exercise period is subject to the condition that if Director shall have
served as a Director for a period of six (6) years or more, the Option shall
continue to be exercisable until the close of business on the last business day
of the 24th month following such cessation of service.  If the Director dies within such 24-month
period, then the Option may be exercised within the 12 month period after his
or her death by the person specified in paragraph 4(b) below.  Notwithstanding the foregoing, however, in no
event may the Option be exercised after the expiration of the Term, and to the
extent the Option is not exercisable on the date of cessation of services, the
Option shall expire on that date.

 

(b)  Death.  Upon the cessation of the Director’s service
as a Director by reason of death, the Option shall become immediately
exercisable and may be exercised at any time or times in whole or in part not
later than the close of business on the last business day of the 12th month
following the date of the Director’s death, but in no event after the
expiration of the Term, by (i) his/her personal representative, executor,
administrator, or by the person to whom the Option is transferred by will or
the applicable laws of descent and distribution, (ii) the Director’s
beneficiary designated in accordance with paragraph 6 below, or (iii) the
then-acting trustee of a trust described in paragraph 6 below to which the
Option has been transferred in accordance with such paragraph.

 

5.          Additional Limits on Right to Exercise.  Unless at the time of any exercise of the
Option there is, in the opinion of Quixote’s counsel, a valid and effective
registration statement under the Securities Act of 1933, as amended, and an
appropriate qualification and registration under applicable state securities
law, relating to the Stock, Director hereby agrees, upon exercise of the
Option, to represent that he is acquiring the Stock for his own account for
investment and not with a view to, or for sale in connection with, the resale
or distribution of any such Stock and shall give such other representations and
covenants to Quixote as may, in the opinion of its counsel, be required.  In the event that any Stock issued is not
registered, then Director hereby agrees that the certificates representing the
Stock shall bear a restrictive legend, and that stop transfer instructions
shall be issued to Quixote’s transfer agent until such time as the Stock is
registered.

 

2

 

6.          Transferability Restrictions.  The Option granted hereunder shall not be
assignable or transferable other than by will or the laws of descent and
distribution; provided, however,  that the Director may (a) designate in writing
a beneficiary to exercise his Option after the Director’s death, (b) transfer
the Option to a revocable, inter vivos trust as to which the Director is both
the settlor and trustee and (c) transfer the Option for no consideration to any
of the following permitted transferees (each a “Permitted Transferee”): (w) any
member of the Immediate Family of the Director to whom such Option was granted,
(x) any trust solely for the benefit of the Director and members of the
Director’s Immediate Family, (y) any partnership or limited liability company
whose only partners or members are the Director and members of the Director’s
Immediate Family, or (z) any other transferee approved by the Board of
Directors in advance of the transfer; and further provided that: (i) the
transfer of the Option shall not be effective on a date earlier than the date
on which the Option is first exercisable; (ii) any Permitted Transferee to whom
the Option is transferred by Director shall not be entitled to transfer the
Option, other than to Director or by will or the laws of descent and distribution;
and (iii) the Permitted Transferee shall remain subject to all of the terms and
conditions applicable to the Option prior to such transfer.  For purposes of this paragraph 6, “Immediate
Family” means, with respect to the Director, such Director’s spouse, children,
stepchildren, grandchildren, parents, stepparents, grandparents, siblings,
mother-in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law, and
sister-in-law, and shall include relationships arising from legal adoption.

 

7.          Stockholder Rights and Adjustments
to Stock.  Director shall have no
rights as a stockholder with respect to any Stock issuable or transferable upon
exercise of the Option until the date of issuance of a stock certificate to him
for such shares of Stock.  No adjustment
shall be made for dividends (ordinary or extraordinary, whether in cash,
securities or other property) or distributions or other rights for which the
record date is prior to the date such stock certificate is issued and all
adjustments to the Stock by reason of a stock dividend, merger, consolidation
or otherwise, shall be made in accordance with the terms of the Director
Plan.  This Option shall not affect in
any way the right or power of Quixote to make adjustments, reclassifications or
changes in its capital or business structure or to merge, consolidate,
dissolve, liquidate, sell or transfer all or any part of its business or
assets.

 

8.          Governing Law.  The law of the State of Illinois, except its
law with respect to choice of law and except as to matters relating to
corporate law (in which case the corporate law of the State of Delaware shall
control), shall be controlling in all matters relating to this Option.

 

9.          Director Plan.  In all respects this Option shall be subject
to the terms and provisions of the Director Plan which has been, or is being,
provided, or otherwise made available, to Director and is incorporated herein
by reference.  Accordingly, the rights of
Director under this Option and the shares of Stock which Director may purchase
hereunder are subject to certain other restrictions as set forth in the
Director Plan.

 

10.        Securities Law Matters.   Director may be
required, after electing to purchase shares pursuant to the Option, as a
condition to such purchase, to represent to Quixote that Director has access by
reason of such Director’s service with Quixote to sufficient information
concerning Quixote to enable Director to evaluate the merits and risks of the
prospective

 

3

 

investment and has such knowledge and experience in
financial and business matters so that Director is capable of evaluating such
investment, and that Director is acquiring the shares solely for such Director’s
account and will not sell the securities without registration under the
Securities Act of 1933 (which Quixote is under no obligation to provide) or
exemption therefrom.  Share certificates
shall bear such legend as Quixote may deem necessary.

 

4Exhibit
10.1

 

October 6, 2004

 

 

 

Ms. Carol A. Toth

345 East Street

East Walpole, MA 02032

 

Dear Carol:

 

I am pleased to present our offer to you to
join Anika Therapeutics, Inc. (“Anika” or the “Company”) as an employee. The
terms of our offer are outlined below:

 

Position: Vice
President Research and Development

 

Description Of Duties: Serving as an
officer and key member of the corporate strategic leadership team, you will
have responsibility for the overall research and development function including
the development of the Company’s technology plans, as well as responsibility
for the regulatory and clinical functions of the Company. You will oversee the
design and development of Anika’s products from concept to commercialization,
and you will be responsible for managing the Scientific Advisory Board. You also shall be responsible for performing any duties
assigned to you by or under the authority of the Company that are appropriate
for an individual of your experience.

 

Reporting To:  Chief Executive Officer and President

 

Employment Date: Your
anticipated start date is as soon as possible.

 

Rate of Pay: $8,653.85 per
bi-weekly payroll (annualized $225,000.00), subject to applicable deductions
and withholdings.

 

Bonus Eligibility:  Under the new compensation plan, yet to be
approved by the Compensation Committee, you will be eligible to receive a
discretionary annual target bonus of up to 25% of your annualized base salary
subject to determination by the Board of Directors and based on the Company’s
performance and your personal performance against key objectives.  To be eligible to receive a bonus, you must
be a current employee at the time that the bonus is distributed. Your 2004
bonus will be pro-rated based on your 2004 base salary earned.

 

Stock Options: Shortly after
you commence employment, you will be granted an option on 75,000 shares of
common stock of the Company, subject to approval by the Compensation Committee
of the Board of Directors.

 

1

Carol A. Toth Offer of Employment

 

 

Signing Bonus: Anika will
pay you in your first paycheck the sum of $30,000 less applicable withholdings,
for your accepting the position of Vice President Research and Development.

 

Benefits: You will be
eligible to participate in the Anika employee benefit programs upon
commencement of employment. This program currently covers comprehensive medical
and dental benefits, life and disability insurance, supplemental disability
insurance, and a Section 125 Plan. You will be eligible to participate in our
401(k) Savings and Investment Plan at the first enrollment date following your
date of hire. Under the current terms, the 401(k) plan entitles you to
contribute up to the maximum limit established by the IRS. The Company will
match 100% of your contribution up to 5% of your salary. Your participation in
the benefit plans will be governed by and subject to the plan terms as
described in the official documents and Summary Plan Descriptions.

 

Vacation: You will
accrue four weeks of vacation during your first year of employment, subject to
the terms of accrual and use set forth in Anika’s policies.

 

Executive MBA Program: Upon
completion of one year’s service, you may enroll and the Company agrees to pay
50% of the tuition and fees to a maximum of $50,000.

 

Severance In The Event Of Termination:

 

1)              Termination
without cause (non-performance related): If Anika terminates your employment
without “cause” (as construed under Massachusetts common law for employment
contracts), Anika will continue your base salary at its then current rate for
six months, subject to your compliance with your obligations under your other
agreements with the Company and your cooperation with any other reasonable
requests by Anika for assistance during that period. In addition, in such
circumstances the Company will also pay the premiums for continuation of
medical and dental benefits under COBRA for you and your family for six months
after termination of your employment (or until the end of COBRA eligibility, if
earlier), subject to your premium payment of the active employee share of
premium payments for such coverage.

 

2)              Termination for
cause: Anika may terminate your employment at any time for cause by delivering
to you a certified copy of a resolution of the Board of Directors of Anika
finding that you committed an act of omission constituting cause hereunder and
specifying the particulars thereof in detail, adopted at a meeting called and
held for that purpose and of which you were provided not less than seven days
advance notice, including notice of the agenda of such meeting. As used herein,
the term “cause” shall mean :

i.                  conviction of a
felony involving the Company,

ii.               acting in a
manner which is materially detrimental or materially damaging to the Company’s reputation
or business operations other than actions which involve your bad judgment or a
decision which was taken in good faith, provided that you

 

2

Carol A. Toth Offer of Employment

 

shall
have failed to remedy such action within ten days after receiving written
notice of the Company’s position with respect to such action; or

iii.            committing any
material breach of this agreement, provided that, if such breach is capable of
being remedied, you shall have failed to remedy such breach within ten days
after your receipt of written notice requesting that you remedy such breach.

 

Change in Control and
Severance Agreement: Subject to the approval of the Compensation
Committee of the Board of Directors, an Agreement (attached) between you and
Anika Therapeutics, Inc. shall be executed providing terms pertaining to a
Change in Control. The purpose of this Agreement is to reinforce and encourage
your continued attention and dedication to your assigned duties without distraction
in the face of potentially disturbing circumstances arising from the
possibility of a Change in Control.

 

Non-Disclosure and
Non-Competition Agreement:  You understand
that as a condition of your employment, you will be required to execute Anika’s
Non-Disclosure and Non-Competition Agreement, a copy of which is enclosed.  You further understand that the Anika
Non-Disclosure and Non-Competition Agreement contains conditions that will
survive the termination of your employment, regardless of the reason for that
termination.

 

Arbitration: In the event
of any controversy or claim arising out of or relating to this letter agreement
or otherwise arising out of your employment or the termination of that
employment (including, without limitation, any claims of unlawful employment
discrimination whether based on age or otherwise), that controversy or claim
shall, to the fullest extent permitted by law, be settled by arbitration under
the auspices of the American Arbitration Association (“AAA”) in Boston, Massachusetts
in accordance with the Employment Dispute Resolution Rules of the AAA,
including, but not limited to, the rules and procedures applicable to the
selection of arbitrators (or alternatively, in any other forum or in any other
form agreed upon by the parties). In the event that any person or entity other
than you or Anika may be a party with regard to any such controversy or claim,
such controversy or claim shall be submitted to arbitration subject to such
other person or entity’s agreement. Judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof. This
provision shall be specifically enforceable. Notwithstanding the foregoing,
this provision shall not preclude either party from pursuing a court action for
the sole purpose of obtaining a temporary restraining order or a preliminary
injunction in circumstances in which such relief is appropriate; provided that
any other relief shall be pursued through an arbitration proceeding pursuant to
this provision.

 

Background Check: You
understand and agree that all employees are subject to a background check
including verification of education.  I
enclose a waiver in this regard for your signature.

 

3

Carol A. Toth Offer of Employment

 

At-Will Employment:  You, like everyone else at Anika, will be an
at-will employee. The terms of your employment will be interpreted in
accordance with and governed by the laws of the Commonwealth of Massachusetts.

 

Representation Regarding
Other Agreements:  Finally,
this offer is conditioned on your representation that you are not subject to
any confidentiality or non-competition agreement or any other similar type of
restriction that would affect your ability to devote full time and attention to
your work at Anika Therapeutics, Inc. Upon commencement of your employment, you
will be required to provide evidence that you are a U.S. citizen or national, a
lawful permanent resident, or an alien authorized to work in the U.S.

 

If the terms of this offer are acceptable,
please indicate your acceptance by signing both copies of this letter, the Anika Non-Disclosure and Non-Competition Agreement and the background check waiver and
return one copy of each to me. I am very enthusiastic about Anika’s future
prospects and look forward to your leadership and contribution to the Anika
team.

 

This offer is valid until October 11, 2004.

 

Sincerely,

 

	
  /s/ Charles H. Sherwood

  

 

Charles H. Sherwood, Ph.D.

Chief Executive Officer and President

 

 

 

Agreed and accepted:

 

	
  /s/ Carol A. Toth

  

Carol A. Toth

 

	
  Date:

  	
  10/11/04

  

 

Enclosures

 

4

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