SEVERANCE AND NON-COMPETITION AGREEMENT

NonCompetition Agreement

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Quixote Corporation

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Title: SEVERANCE AND NON-COMPETITION AGREEMENT
Governing Law: Illinois Date: 7/28/2008
Industry: ALARMS Sector: SERVIC

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Exhibit 10

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 Executives 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 Executives 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 Executives written consent. The Executives 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 Executives 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 Executives employment upon:

(i)

the willful failure by the Executive to substantially perform his duties, other than when such failure resulting from the Executives 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 Executives 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 Executives 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 Quixotes 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 Executives 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 Executives 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 Executives 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.

(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 Executives 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 Executives 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 Executives separation from service, or (ii) the date of the Executives 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, Executives relationship with Quixote continues to be an at-will employment relationship. Quixote or Executive has the right to terminate Executives 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 Executives 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 Executives 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

the Executives 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 Executives 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 Executives 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 Executives 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 Executives 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

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SEVERANCE AND NON-COMPETITION AGREEMENT

NonCompetition Agreement

Quixote Corporation

Search NonCompetition Agreement by:

1. Certain Defined Terms.

(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.

(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.

(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).

(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.

7. Non-Competition.

(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

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

(b) Cause. Quixote shall have Cause to terminate the Executives employment upon:

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

(c) Disability. An Executives 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 Quixotes 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.

Subject to Section 7(f), payment of the Executives 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) Covenants During Employment. During the Executives 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 Executives employment, the Executive will not: