EXHIBIT 10.40
AMENDMENT NO. 1
TO
EMPLOYMENT AGREEMENT
FIRST AMENDMENT TO EMPLOYMENT AGREEMENT, made as of January 1, 2005, among
WINSTON HOTELS, INC., a North Carolina corporation (the "Corporation"), and
XXXXX X. XXXX (the "Employee"):
WHEREAS, the Employee and the Company entered into an Employment Agreement
dated as of March 30, 2004 (the "Employment Agreement"); and
WHEREAS, the parties desire to amend the Employment Agreement as provided
herein.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the parties hereby agree as follows:
1. Section 3(a) of the Employment Agreement is hereby deleted in its
entirety and the following is hereby substituted in lieu thereof:
"(a) Salary. Compensation for Employee's services under this Agreement
shall be One Hundred Seventy-Five Thousand ($175,000) per year, payable in
accordance with the Corporation's reasonable policies, procedures, and
practices as they may exist from time to time. The Employee's salary shall
be reviewed annually by the Corporation's Board of Directors as of December
31 and by February 15 of each year and may be changed in the Board's
reasonable discretion."
2. Section 3(b) of the Employment Agreement is hereby deleted in its
entirety and the following is hereby substituted in lieu thereof:
"(b) Bonus. Employee shall be entitled to earn an annual bonus of up to one
hundred percent (100%) of his annual salary with the specific amount to be
reviewed and determined annually by the Corporation's Board of Directors."
3. Section 5(a) of the Employment Agreement is hereby deleted in its
entirety and the following is hereby substituted in lieu thereof:
"(a) With Notice. Either the Corporation or Employee may terminate this
Agreement during the original or any extension term of employment by giving
ninety (90) days prior written notice to the other party. If the
Corporation terminates this Agreement with such notice, or gives a notice
of non-renewal pursuant to Section 4 of this Agreement, then Employee shall
be entitled to an amount equal to the sum of (i) the Employee's then
current monthly salary multiplied by 12 plus (ii) an accrued bonus amount
equal to 100% of the Employee's then current annual salary pro rated from
the first day of the calendar year in which such notice is given through
and including the day and date that the
Employee leaves the employment of the Company, with said amount to be paid
in a lump sum upon the date of termination of this Agreement."
4. The third paragraph of Section 5 of the Employment Agreement is hereby
deleted in its entirety and the following is hereby substituted in lieu thereof:
"In the event of termination for Cause, the Corporation's obligation to
compensate Employee ceases on the date of termination except as to the
amounts of salary due at that time. In the event of termination for
Disability, the Corporation shall pay Employee's then current annual salary
(reduced by any payments Employee receives from disability insurance) and
any bonus to which he may be entitled equal to 100% of the Employee's then
current annual salary for a period of one year from the date of
termination. In the event of termination for death, the Corporation shall
pay Employee's estate any salary and prorated bonuses to which he may be
entitled as of the date of termination."
5. Section 8(c)(ii) of the Employment Agreement is hereby deleted in its
entirety and the following is hereby substituted in lieu thereof:
"(c)(ii) a severance payment equal to one and one-half (1.5) times the
amount of the Employee's current annual compensation plus a bonus equal to
100% of the Employee's then current annual salary; provided, however, that
in no case shall the amount used for such annual compensation or bonus be
less than those amounts immediately prior to the Change in Control. The
severance payment shall be paid in a lump sum upon the date of
termination;"
6. Except to the extent hereby amended, the Employment Agreement is herby
confirmed and ratified and shall continue in full force and effect.
7. The effective date of this Amendment is January 1, 2005.
[Signatures to appear on the following page]
IN WITNESS WHEREOF, the parties have executed this First Amendment to
Employment Agreement as of the date first written above.
WINSTON HOTELS, INC.: EMPLOYEE:
By: /s/ Xxxxxx X. Xxxxxxx /s/ Xxxxx X. Xxxx
--------------------------------- ----------------------------------------
Name: Xxxxxx X. Xxxxxxx Name: Xxxxx X. Xxxx
Title: Chief Executive Officer Title: Vice President &
Dated: January 1, 2005 Chief Accounting Officer
Dated: January 1, 2005
