Document:

Exhibit 10.9

 

GUARANTY OF LEASE

 

In order to
induce Third Property, Inc. (“Landlord”) to enter into that certain
Lease dated 10/29, 2007 (the “Lease”) with Kenja, II, Inc.,  a Florida Corporation (“Tenant”), VCG Holding
Corp., a Colorado corporation (“Guarantor”) hereby makes the following
agreements with and in favor of Landlord:

 

1.             Guarantor hereby guarantees,
unconditionally and absolutely, the full and faithful performance and
observance of all the covenants, terms, and conditions of the Lease to be performed
and observed by Tenant, expressly including, without being limited to, the
payment, when due, of Minimum Rent and additional rent payable under the Lease.

 

2.             If the Lease shall be modified in
any respect by agreement between Landlord and Tenant, the obligations hereunder
of Guarantor shall extend and apply with respect to the full and faithful
performance and observance of all the covenants, terms and conditions of the
Lease and of any such modification thereof.

 

3.             If the Lease shall be renewed, or
its term extended, for any period beyond the date specified in the Lease for
the expiration of said term, either pursuant to any option granted under the
Lease or otherwise, or if Tenant holds over beyond the term of the Lease, the
obligations hereunder of Guarantor shall extend and apply with respect to the
full and faithful performance and observance of all the covenants, terms and
conditions of the Lease and of any such modification thereof.

 

4.             Insofar as the payment by Tenant of
any sums of money to Landlord is involved, this Guaranty is a guaranty of
payment and not of collection, and shall remain in full force and effect until
payment in full to Landlord of all sums payable under the Lease. Guarantor
waives any right to require that any action be brought against Tenant.

 

5.             Guarantor does not require any
notice of Tenant’s nonpayment, nonperformance, or non-observance of the
covenants, terms and conditions of the Lease. Guarantor hereby expressly waives
the right to receive such notice.

 

6.             Guarantor expressly agrees (without
in any way limiting his liability under any other provision of this Guaranty)
that Guarantor shall, at the request of Landlord, enter into a new lease with
Landlord on the same terms and conditions as contained in the Lease immediately
prior to its termination, for a term commencing on the termination date of the
Lease and ending on the expiration date of the Lease, if the Lease shall be
terminated due to a default by Tenant thereunder.

 

7.             The liability of Guarantor is
coextensive with that of Tenant and also joint and several, and action may be
brought against Guarantor and carried to final judgment either with or without
making Tenant a party thereto.

 

(INITIALED:
MO, KW)

 

 

8.             Until all of Tenant’s obligations
under the Lease are fully performed, Guarantor (a) waives any rights that
Guarantor may have against Tenant by reason of any one or more payments or acts
in compliance with the obligations of Guarantor under this Guaranty, and (b)
subordinates any liability or indebtedness of Tenant held by Guarantor to the
obligations of Tenant to Landlord  under
this Lease.

 

9.             Neither Guarantor’s obligation to
make payment in accordance with the terms of this Guaranty nor any remedy for
the enforcement thereof shall be impaired, modified, released or limited in any
way by any impairment, modification, release or limitation of the liability of
Tenant or its estate in bankruptcy, resulting from the operation of any present
or future provision of the Bankruptcy Code of the United States or from the
decision of any court interpreting the same.

 

10.           Guarantor waives any right to require
that resort be had to any security or to any other credit in favor of Tenant.

 

11.           Guarantor waives the benefit of any
statute of limitations affecting Guarantor’s liability under this Guaranty. Guarantor
hereby waives the right to trial by jury in any action or proceeding that may
hereafter be instituted by Landlord against Guarantor in respect of this
Guaranty.

 

12.           Guarantor irrevocably appoints Tenant
as his agent for service of process related to this Guaranty.

 

13.           Guarantor shall pay all of Landlord’s
expenses, including but not limited to, attorney’s fees, incurred in enforcing
this Guaranty.

 

14.           The Lease and this Guaranty shall be
governed by, interpreted under the laws of, and enforced in the courts of the
State of Florida.

 

15.           This Guaranty, and all of the terms
hereof, shall be binding on Guarantor and the successors, assigns and legal
representatives of Guarantor, and shall inure to the benefit of and may be
enforced by Landlord, its successors and assigns, and the holder of any
mortgage to which the Lease may be subject and subordinate from time to time.

 

16.           Anything herein or in the Lease to
the contrary notwithstanding, Guarantor hereby acknowledges and agrees that any
security deposit or other credit in favor of the Tenant may be applied to cure
any Tenant default or offset any damages incurred by Landlord under the Lease,
as Landlord determines in its sole and absolute discretion, and Landlord shall
not be obligated to apply any such deposit or credit to any such default or
damages before bringing any action or pursuing any remedy available to Landlord
against Guarantor. Guarantor further acknowledges that its liability under this
Guaranty shall not be affected in any manner by such deposit or credit, or
Landlord’s application thereof.

 

(INITIALED: MO, KW)

 

 

17.                                 Guarantor
signs this guarantee personally and not as a representative or officer of any
corporation, partnership, or trust.

 

	
   

  	
  Guarantor:

  	
  VCG HOLDING
  CORP.,

  
	
   

  	
   

  	
  390 Union
  Street, Suite 540

  
	
   

  	
   

  	
  Lakewood,
  Colorado, 80228

  

 

VCG HOLDING CORP., a Colorado
Corporation

 

 

	
  By:

  	
    /s/
  Micheal L. Ocello

  	
   

  
	
  Troy Lowrie,
  CEO

  
	
  Micheal
  Ocello, Pres.

  

 

(INITIALED:
MO, KW)Exhibit 10.1

 

CONFIDENTIAL SEPARATION AGREEMENT

 

This Confidential Separation Agreement (“Agreement”)
is entered into as of the Separation Date indicated below between KIMBALL HILL, INC. (“Company”) and Eugene K.
Rowehl (“Employee”).

 

Whereas, Employee and Company have jointly concluded
that it is in their mutual best interests that Employee’s employment
relationship with Company should end,

 

Therefore, in consideration of the mutual promises and
agreements set forth in this Agreement, Company and Employee agree as follows:

 

1.             Employment Separation.

 

A.            Effective October
19, 2007 (“Separation Date”), Employee resigns from all active employment by
and all offices and positions with Company and Company’s parents, subsidiaries,
and affiliates, including but not limited to the position of Senior Vice
President and Chief Financial Officer of Kimball Hill, Inc. Upon Company’s
request, Employee shall execute and deliver to Company written resignations as
a director, management committee member and/or 
officer of all of Company’s subsidiaries and affiliates.

 

B.            Effective on the
Separation Date, Employee’s employment shall end and Employee shall have no
duties and no authority to make any representations or commitments on behalf of
Company and Company’s subsidiaries and affiliates, as an officer, employee, or
in any other capacity whatsoever. Thereafter, Employee shall have no further
rights deriving from Employee’s employment by Company or Company’s subsidiaries
and affiliates and shall not be entitled to any further compensation or
non-vested benefits, except as provided in this Agreement.

 

2.             Separation Payment.  In exchange for Employee’s Covenants in
Section 6, Employee’s Waiver and Release of Claims in Section 7, and Employee’s
Covenant Not To Sue in Section 8, and the other acknowledgements and agreements
in this Agreement, and subject to the terms and conditions of this Agreement,
Company shall pay Employee the gross amount of $550,000.00  payable in a single payment (the “Separation
Payment”) after the expiration of the revocation period described in Section 7
of this Agreement; provided that if Employee cancels this Agreement pursuant to
Section 7 of the Agreement, then Company will have no obligation to pay
Employee any portion of the Separation Payment.  This
Separation Payment is made in lieu of, and not in addition to, payments
otherwise provided for under the Severance Pay Policy maintained by Company.
Employee acknowledges that the Separation Payment is good and valuable
consideration to which Employee is not otherwise entitled.

 

If Employee does not sign this Agreement or, after
signing, cancels this Agreement, then he shall receive only those benefits and
payments required by law.

 

1

 

3.             Bonus.  Company will pay Employee a bonus for the
Company’s 2007 Fiscal Year in the amount of $165,000.00 no earlier than January
2, 2008 and no later than January 31, 2008.

 

4.             Stock Purchase.  Company agrees to purchase from Employee all
shares of common stock of the Company owned by Employee, in accordance with the
following provisions:

 

A.            Employee
currently owns 55,000 shares of common stock of Company, represented by
Certificate No. 30 dated 10/31/1999 (7,500 shares), Certificate No. 37 dated
12/31/2001 (16,500 shares), Certificate No. 94 dated 9/23/2005 (7,000 shares),
Certificate No. 120 dated 9/28/2006 (16,097 shares), and Certificate No. 121
dated 9/28/2006 (7,903 shares) (collectively, the “Company Stock”). Employee
represents and warrants that he is the lawful owner of, and has the complete
right, title, and interest in and to the Company Stock, free and clear of any
and all liens, encumbrances, or rights of third parties, that he has not sold,
transferred, pledged, or assigned the Company Stock, and that he has full power
to sell, transfer, and assign the Company Stock to Company in accordance with
the terms of this Agreement.

 

B.            Company
and Employee agree that the per share fair market value of Company Stock as of
the Separation Date (“Fair Market Value”) will be the value determined by
Company’s Stock Option Committee (“Committee”) organized pursuant to the
Company’s Incentive Stock Option Plan (“Plan”). The parties understand that the
Trustee of the Company’s Employee Stock Ownership Plan (the “ESOP”) will make a
determination of the fair market value of the Company’s common stock as of
September 30, 2007  for purposes of the
ESOP (the “ESOP Valuation”).  Employee
agrees that the Committee may determine, in its discretion, that the Fair
Market Value as of the Separation Date is the per share fair market value of
the Company’s common stock as of September 30, 2007 determined by the Trustee
of the ESOP, and Employee agrees to accept the Committee’s determination for
all purposes of this Agreement. Company and Employee anticipate that the
Trustee will notify Company of the ESOP Valuation in November 2007 and that the
Committee will make its determination of Fair Market Value thereafter.  Within one week after Company’s receipt of
the Trustee’s written determination of the ESOP Valuation as of September 30,
2007, Company will notify Employee of (1) the ESOP Valuation as determined by
the Trustee and (2) the Fair Market Value as determined by the Committee.

 

C.            Employee
agrees to sell, and Company agrees to buy, effective as of the Separation Date,
all of the Company Stock for an amount equal to 55,000 multiplied by the Fair
Market Value as determined by the Committee (the “Purchase Price”).

 

D.            Employee agrees that
he will deliver to Company the following documents not later than one week
after his receipt of the notification of the ESOP Valuation as determined by
the ESOP Trustee and the Fair Market Value as determined by the Committee:

 

1.             Certificate No. 30
dated 10/31/1999, Certificate No. 37 dated 12/31/2001, Certificate No. 94 dated
9/23/2005, Certificate No. 120 dated 9/28/2006, and Certificate No. 121 dated
9/28/2006 (collectively, the “Certificates”); and

 

2

 

2.             Executed Stock
Powers for all the Certificates in substantially the form of Exhibit A to this
Agreement.

 

Title to the Company Stock will vest in Company
immediately upon Employee’s delivery of the Certificates and the executed Stock
Powers to Company.

 

E.             Payment of Purchase
Price

 

1.             Employee
acknowledges that the Company’s loan and financing agreements, including the
Trust Indenture (the “Trust Indenture”) with respect to the $203 million in
principal amount of 101⁄2% senior subordinated notes due 2012 that subsequently
were registered with the Securities and Exchange Commission and the Credit
Agreement (the “Credit Agreement”) with respect to the Company’s $500 million
revolving credit facility, as they may be amended, modified, refinanced or
replaced in the future, place various limitations, restrictions and constraints
upon the Company’s ability and willingness to redeem shares from its
shareholders.  Employee further
acknowledges that the Company has the right and need to maintain a certain
level of financial availability to make “Restricted Payments” as defined in the
Trust Indenture to terminated, retired, or deceased employees who have vested
benefits in the Company’s Employee Stock Ownership Plan (“ESOP”).

 

                2.             Provided that Employee has
delivered the Certificates and the executed Stock Powers to Company in
accordance with this Section 4, Company will pay Employee the Purchase Price as
follows:  on or before January 15, 2008,
Company will pay Employee an amount equal to the lower of (i) the Purchase
Price or (ii) $4,000,000. The Company shall make such further payment of the
Purchase Price, if necessary, as soon as, in Company’s reasonable opinion, it
has satisfied its obligations to make any required payments to former employees
who have vested benefits in the ESOP, so long as Company is otherwise permitted
to make a further payment of the Purchase Price under the various limitations,
restrictions and constraints contained in the Trust Indenture and the Credit
Agreement.

 

3.             The Purchase Price
shall be evidenced by the Company’s Non-Negotiable Promissory Note in
substantially the form attached as Exhibit B, which shall be delivered to
Employee on the date on which Employee delivers the Certificates and executed
Stock Powers to Company.

 

4.             All
payments of the Purchase Price shall be made, at the direction of Employee,
either by wire transfer or by check payable to Eugene K. Rowehl and mailed to
the following address:

 

2634 Hidden Shore Drive

Katy, TX  77450

 

3

 

The check shall be mailed first class mail, postage prepaid,
and each payment shall be considered made as of the date of mailing.

 

                5.             Notwithstanding anything in this
Agreement to the contrary, under no circumstances will Company be obligated to
make any payment of the Purchase Price if, in the reasonable opinion of
Company, the payment is prohibited (a) by the Trust Indenture or the Credit
Agreement or any similar agreement or commitment or (b) by any federal, state,
or other securities law, or any other requirement of law or of any regulatory
body with jurisdiction over the Company.

 

5.             Other Benefits and Compensation.

 

A.            Vacation Pay.  In addition to the Separation Payment,
Company will pay Employee for any accrued and unused vacation days and floating
holidays earned by Employee as of the Separation Date, except that if Employee
has taken unearned vacation days, Employee’s final regular paycheck will be
reduced to reflect the cost of such vacation days.

                B.            Matching Contributions.  Under Company’s Matching Contributions
Program, Company will match only charitable contributions made prior to
Employee’s Separation Date.

 

                C.            Continuing Health
Benefits.  Company will
continue to provide Employee, through the group health benefits plans
maintained by Company, with individual or family medical and dental coverage on
substantially the same basis as active employees of Company until the earlier
of the first anniversary of the Separation Date or the last day of the month in
which Employee commences employment with another employer or the last day of
the month in which Employee ceases to pay for this coverage (the “Coverage
Period”).  The Coverage Period shall not
be taken into account as a period of continuation coverage for purposes of Part
6 of Title I of the Employee Retirement Income Security Act of 1974 (also known
as the Consolidated Omnibus Budget Reconciliation Act or COBRA) or for purposes
of any other obligation of Company to provide any continued coverage to
Employee (or, if applicable, to Employee’s family) under any group health
benefits plan maintained by Company. 
Notwithstanding any provision in this Agreement to the contrary, Company
reserves the right to amend, modify or terminate any group health benefit plan
maintained by Company) and any such amendment, modification, or termination
will apply to Employee during the Coverage Period to the same extent that it
applies to active employees of Company.

 

                D.            Outplacement Assistance.  Company will provide Employee, at Company’s
expense, with six months of outplacement assistance through the firm of Scherer,
Schneider, Paulick (“SSP”). At Employee’s request, Company will continue to
provide Employee with outplacement assistance through SSP on a month-to-month
basis for up to six additional months.

 

E.             Withholding.  Company will withhold from the compensation
and benefits payable to Employee under this Agreement all appropriate
deductions for employee benefits, if 

 

4

 

applicable, and all amounts necessary for Company to satisfy its
withholding obligations under applicable tax laws.

 

6.             Employee’s Covenants.  In order to protect the business, good will,
confidential information, relationships and other proprietary rights of
Company, Employee agrees to the following:

 

A.            Return of Company Property. 
By the Separation Date, Employee will return to Company all Company
property, including but not limited to: 
identification cards; files; computer hardware, software, equipment and
disks; cell phones; keys; Company owned or leased vehicles; credit cards; and
financial records, customer lists, vendor information, and all other
Confidential Information (as defined below) in Employee’s possession, except
that Employee may retain his laptop computer, provided that Employee delivers
the laptop to the Company IT representative in Rolling Meadows prior to October
12, 2007 so that the Company can remove all Company proprietary programs and
all Company information from this computer.

 

B.            Nondisclosure of Company’s Confidential Information.  Employee acknowledges that he performed
services for the Company that required the Company to disclose to him
confidential business information and trade secrets (“Confidential Information”).
Employee agrees that he will keep all Confidential Information strictly and
absolutely confidential and that he will not directly or indirectly use or
disclose to any person outside the Company, any Confidential Information of
Company, or any Confidential Information received from or about third parties
by Company. Employee will use reasonable and prudent care to safeguard and
prevent the unauthorized use or disclosure of Confidential Information.
Employee acknowledges and agrees that Confidential Information is any
information relating to the Company and its employees, customers, trade
partners, and development partners that is not generally available to the
public, and includes information relating to the Company’s actual or
anticipated business operations, including, but not limited to, information
about the Company’s products, homebuilding designs and specifications, credit
agreements, debt instruments, equity financing agreements, financial
performance, projected financial performance, financial data, financial
strategy, assets, liabilities, pricing, margins, business systems, business
plans, marketing plans, customer strategy, land acquisition strategy, land
acquisition terms, land development strategy, the identity of Company’s
subcontractors, vendors, suppliers, and partners, resources, technical
analyses, and recruiting and compensation practices.

 

Employee acknowledges and agrees that the Confidential
Information is valuable and that breach of his or her confidentiality
obligations will cause Company irreparable injury and damage that cannot be
reasonably or adequately compensated by money damages. Employee expressly
agrees that Company shall be entitled to injunctive or other equitable relief
in order to prevent a breach of his confidentiality obligations, in addition to
any other remedies legally available to Company. Employee expressly waives the
claim that Company has an adequate remedy at law for breach of Employee’s
obligations under this Section 6.

 

5

 

C.            Nonsolicitation of Employees. Employee shall not, at any
time prior to the Separation Date or during the twelve (12) month period
following the Separation Date, solicit or participate in or promote the
solicitation of any person who was employed by Company on the Separation Date
to leave the employ of Company or, on behalf of himself or any other person,
hire, employ, or engage any such person, or otherwise interfere with the
performance of any person’s duties for the Company.

 

7.             Employee’s Waiver and Release of Claims.  As a material inducement to Company to enter
into this Agreement, and in consideration of Company’s promise to make the
Separation Payment, Employee knowingly and voluntarily releases and forever
discharges Company, and all of its past, present, and future affiliates,
parents, subsidiaries and related entities, and all of their past, present and
future officers, directors, shareholders, employees, agents, attorneys and
assigns (collectively, the “Releasees”), from any federal, state or local
claims, demands, actions, liabilities, suits or causes of action, at law or
equity or otherwise, and any and all rights to or claims for attorneys’ fees or
damages (including back pay, compensatory, punitive, or liquidated damages) or
equitable relief, which s/he has or may have against any or all of the
Releasees, whether such claims are known or unknown, arising up until the
Separation Date, out of Employee’s employment with Company or any of its
affiliates or the termination of Employee’s employment with Company or any of
its affiliates except that Employee does not waive any claims for workers’
compensation benefits or unemployment benefits.

 

This release includes, but is not limited to, rights and claims arising
under the Age Discrimination in Employment Act of 1967, as amended by the Older
Workers Benefit Protection Act of 1990 (“ADEA”), Title VII of the Civil Rights
Act of 1964, as amended, the Americans with Disabilities Act, ERISA, the Fair
Labor Standards Act, any state or local human rights statute or ordinance, any
claims or rights of action relating to breach of contract, breach of an employment
agreement, breach of a bonus agreement, violation of personnel policies or
handbooks, public policy, personal or emotional injury, defamation, libel,
slander, additional compensation, or fringe benefits; provided, however, that
Employee does not release any claims he may have now or in the future for (1)
indemnification by Company under its by-laws; or (2) any insurance coverage,
including, without limitation, directors and officers liability insurance,
which might cover Employee for any acts or omissions he committed while an
officer or employee of Company.  Employee
specifically waives the benefit of any statute or rule of law which, if applied
to this Agreement, would otherwise exclude from its binding effect any claims
not now known by Employee to exist. This release is not intended to waive or
release any claim for failure to provide vested benefits under a
Company-sponsored employee benefit plan to which Employee is legally entitled.
Nor does this release waive claims arising after the date of this Agreement or
claims that otherwise cannot be released by law.

 

YOU
UNDERSTAND THAT THIS CONFIDENTIAL SEPARATION AGREEMENT INCLUDES A RELEASE OF
ALL KNOWN AND UNKNOWN CLAIMS YOU MAY HAVE AGAINST COMPANY AS OF THE DATE OF
THIS AGREEMENT.

 

6

 

This Agreement is presented to Employee on or before October 3,
2007.  Employee acknowledges that he has
reviewed this Agreement in its entirety. 
Employee acknowledges that he has been granted at least twenty-one (21) days
within which to consider this Agreement. 
Employee has, by this Agreement, been advised in writing to consult with
legal counsel prior to executing this Agreement.  Employee acknowledges that if he executes
this Agreement prior to the expiration of twenty-one (21) days, or chooses not
to consult legal counsel, he does so freely and knowingly, and waives any and
all claims that such action or inaction would affect the validity of this
Agreement.  Employee further acknowledges
that any changes to this Agreement, whether material or immaterial, do not
restart the twenty-one (21) day period.

 

Employee understands that he may cancel this Agreement at any time on
or before the seventh day following the date on which he signs the
Agreement.  To be effective, the decision
to cancel must be in writing and delivered to Company, personally or by
facsimile, on or before the seventh day after Employee signs this Agreement, to
the attention of:

 

Bob Ryan

Senior Vice President, People

Kimball Hill, Inc.

5999 New Wilke Road

Rolling Meadows, IL 
60008

Fax No.: (866) 328-9051

 

The Separation Payment will not be made until fifteen (15) days have
elapsed after the date on which Company has received this Agreement signed by
Employee.  No payments will be due and
owing under this Agreement if Employee cancels this Agreement as provided in
this Section 7.  All payments shall be
made by certified mail, return receipt requested, to Employee at the following
address and shall be considered paid as of the date of mailing:

 

                Eugene K. Rowehl

                _______________________

                _______________________

 

8.             Employee’s Covenant Not to Sue.  A “covenant
not to sue” is a legal term which means you promise not to file a lawsuit in
court or an arbitration. It is different from the Waiver and Release of Claims
contained in Section 7 above. Besides waiving and releasing the claims covered
by Section 7 above, Employee further covenants and agrees not to sue the
Company or any other Releasee based on any claim released by Employee under
Section 7 of this Agreement, except that this Agreement does not limit Employee’s
right to file a charge of discrimination against the Company under ADEA or
other civil rights statute or to participate in an investigation or proceeding
conducted by the Equal Employment Opportunity Commission or other
administrative agency or to bring a lawsuit against the Company to challenge
the validity of this Agreement under the ADEA. 
This Agreement does, however, waive and release Employee’s right to
recover money or other individual relief under ADEA or any other statute.

 

7

 

9.             Employee Acknowledgments.  Employee acknowledges and agrees that (i)
Employee has been paid for all hours worked, including overtime and vacation
pay; (ii) Employee has not suffered any on-the-job injury for which
he has not already filed a claim; and (iii) this Agreement states fully all
agreements, understandings, promises, and commitments as between Employee and
Company relating to the termination of Employee’s employment and (iv) in
deciding to sign this Agreement, Employee has not relied on any
representations, statements, agreements, understandings, promises, or
commitments that are not expressly set forth in this Agreement.

 

10.           Employee Cooperation and Assistance in On-Going
Company Matters.  Employee
agrees to cooperate fully with Company, including its attorneys or accountants,
in providing continuing assistance to Company as needed (a) to enable an
orderly transition of Employee’s responsibilities, (b) to provide information
and advice with respect to matters with which Employee was involved during his
employment with Company, and (c) in connection with any potential or actual
litigation, or other real or potential disputes, which directly or indirectly
involves Company.  Employee agrees to
appear as a witness and be available to attend depositions, consultations, or
meetings regarding litigation or potential litigation as requested by Company.  Company acknowledges that these efforts, if
necessary, will impose on Employee’s time and would likely interfere with other
commitments Employee may have in the future. 
Consequently, Company shall attempt to schedule such depositions,
consultations, or meetings in coordination with Employee’s schedule, but
Employee recognizes that scheduling of certain court proceedings, including
depositions, may be beyond Company’s control. 
Likewise, Company agrees to compensate Employee for Employee’s time
hereunder at a rate equal to $100.00 per hour for actual time spent traveling
to and from and attending such depositions, consultations, or meetings, not to
include ancillary time spent at hotels and related locations during evenings
between proceedings.  Company also agrees
to reimburse Employee for the out-of-pocket expenditures actually and
reasonably incurred by Employee in connection with the performance of the
services contemplated by this Section 10, including hotel accommodations, coach
air fare transportation, and meals, consistent with Company’s
generally-applicable expense reimbursement policies.  It is expressly understood by the parties
that any compensation paid by Company to Employee under this Section 10 shall
be in exchange for Employee’s time only and is not agreed, intended, or
understood to be dependent upon testimony favorable to Company or upon the
character or content of any information Employee discloses in good faith in any
such proceedings, consultations, or meetings.

 

11.           Employee Agreement Not to Seek Future Employment.  Employee agrees he will not apply for
employment or otherwise request to be considered for employment with the
Company or any other Releasee.  Violation
of this provision alone shall be a lawful basis for denying reemployment in the
event Employee does seek such reemployment. In the event the Company or any of
the Releasees hires Employee, Employee understands and agrees that the Company
or the Releasees will have automatic cause to terminate Employee’s employment
and that the termination of Employee’s employment shall not constitute a violation
of any federal, state, or local law, judicial decision, order, or
regulation.  Employee further agrees and
acknowledges that s/he hereby voluntarily waives, releases, discharges and
acquits any such cause of action, if any.

 

8

 

12.           Mutual Nondisparagement.  Company and Employee each agree that they
hold the other in esteem and each agrees not to make disparaging comments about
the other. Company and Employee further agree that each will not engage in any
other conduct that would otherwise harm the reputation or good will of Company
or its management or Employee.

 

13.           Arbitration.

 

A.            Excepting
only the claims identified in Subparagraph B below, any and all disputes and
claims arising out of or relating to your employment by the Company, including
any disputes or claims relating to this Agreement, that are not resolved by
negotiation between us shall be submitted to mediation administered by the
American Arbitration Association (the “AAA”) by one mediator under its
Employment Arbitration Rules and Mediation Procedures in effect at the time of
filing of the demand for mediation. If the dispute or claim is not resolved
through mediation, then it shall be submitted exclusively to final and binding
arbitration administered by the AAA under its Employment Arbitration Rules and
Mediation Procedures in effect at the time of filing of the demand for
arbitration.

 

B.            This
arbitration agreement excludes only the following matters:  (i) a claim for workers’ compensation benefits;
(ii) a claim for unemployment benefits; (iii) the right to file a charge of
discrimination with an administrative agency (except that any subsequent claim
brought by you against the Company for individual relief pursuant to a
right-to-sue letter is covered by this agreement and must be arbitrated); and
(iv) the right to file a charge alleging any unfair labor practice under the
NLRA. All other disputes and claims between us shall be arbitrated. In
addition, any action by Company to obtain injunctive relief for breach of
Employee’s confidentiality obligations under Section 6 of this Agreement may be
maintained in a court of competent jurisdiction.

 

C.            A
request for arbitration shall be filed in writing with the AAA and a copy shall
be provided to the other party. All questions regarding the arbitrability of a
dispute or claim (including all claims that fraud or misrepresentation induced
either party to sign this arbitration agreement) will be resolved by the
arbitrator. Unless the parties agree otherwise in writing, there shall be one
arbitrator. Arbitration shall be held in Chicago, Illinois or such other place
as the parties may mutually agree.   The
arbitrator may grant any remedy or relief that a court of competent
jurisdiction would be authorized to award under applicable law.  The decision or award of the arbitrator shall
be in writing and shall include the reasons for the arbitrator’s decision.  The decision of the arbitrator shall be final
and binding on both parties, and judgment upon the arbitral award may be
entered in any court of competent jurisdiction.

 

D.            Unless
otherwise provided by law, each party shall pay its own expenses, including
without limitation attorneys’ fees and costs (including the cost of experts),
except that the Company shall pay all of the AAA filing and administrative fees
and all of the fees of the arbitrator assigned by the AAA to resolve the
dispute or claim.

 

9

 

E.             In
the event that either party files, and is allowed by the courts to prosecute, a
court action on any dispute or claim, then you and the Company also agree to
waive the right to request a jury trial, and we both understand and acknowledge
that by signing this agreement, we are both giving up any right to have any
disputes or claims relating to your employment decided in a trial by jury.

 

14.           Non-Assignment.  This Agreement is personal to Employee, and
Employee may not assign, transfer, or pledge this Agreement or any rights or
payments arising under this Agreement.

 

15.           Governing Law.  This Agreement shall be governed by the laws
of the State of Illinois, excluding its choice of laws rules.

 

16.           Severability.  If any provision of this Agreement is found
by a tribunal of competent jurisdiction to be invalid or unenforceable, then
that provision and this Agreement shall be deemed to be modified to the extent
necessary to render the provision valid or enforceable, and the modified
Agreement shall be enforced to the maximum extent permitted by law.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year set forth below:

 

	
  Employee

  	
   

  	
  Company

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Eugene K. Rowehl

  	
   

  	
  By:

  	
  /s/ C. Kenneth Love

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Its:

  	
  President & CEO

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Date:

  	
  November 5, 2007

  	
   

  	
  Date:

  	
  November 7, 2007

  
						

 

 

10

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