EXHIBIT 10.32
AMENDMENT NO. 2 TO EMPLOYMENT AGREEMENT
This Amendment No. 2 to Employment Agreement (the "Amendment") is made and
entered into as of the 31st day of January 2005 by and between Arlington Lodging
Group Inc. (the "Company") and Xxxxx X. Xxxx ("Executive").
RECITALS
WHEREAS, the Company and Executive entered into that certain Employment
Agreement dated January 12, 2001 by and between the Company and Executive, as
amended by Amendment No. 1 dated October 29, 2001 (collectively, the
"Agreement");
WHEREAS, the Company is a wholly-owned subsidiary of Arlington Hospitality,
Inc. (the "Parent");
WHEREAS, pursuant to the Agreement, Executive is currently employed by the
Company as its Chief Financial Officer and Senior Vice President of Finance and
serves as Parent's Senior Vice President and Chief Financial Officer; and
WHEREAS, the Company and Executive have agreed to modify the Agreement as
provided herein.
NOW, THEREFORE, in consideration of the premises and mutual covenants and
agreements of the parties herein contained, the parties agree as follow:
1. All capitalized terms used but not defined herein shall have the meaning
ascribed to such term in the Agreement.
2. Amendment to Section 3. Section 3 of the Agreement is amended by deleting
it in its entirety and replacing it with the following:
3. TERM. The term of Executive's employment under this Agreement shall
commence January 12, 2001 and shall continue until June 30, 2006, unless
earlier terminated (the "Term").
3. Amendment to Section 5. Section 5 of the Agreement is amended by, in the
second sentence of such Section, deleting the term "Cash" and replacing it
with "Base Salary."
4. Amendment to Section 6. Section 6 of the Agreement is amended by deleting
it in its entirety and replacing it with the following:
6. SEVERANCE UPON TERMINATION WITHOUT CAUSE. If the Company terminates
Executive's employment without Cause, then Executive shall be entitled to
receive an amount equal to: (i) his then-current Base Salary (as defined in
Exhibit A), expense reimbursement, Benefits, Incentive Bonus (as defined in
Exhibit A), and Transition, Performance and Retention Bonus (as defined in
Exhibit A), each to the extent earned, accrued and unpaid through the date
of termination, plus (ii) an
amount equal to six (6) months of his then-current Base Salary, which
amounts shall be payable in intervals in accordance with the general
payroll payment practice of the Company or as otherwise agreed to by the
Company and Executive.
5. Amendment to Exhibit A. Exhibit A of the Agreement is hereby amended by
deleting it in its entirety and replacing it with Exhibit A attached
hereto.
6. No Other Amendment. The Employment Agreement has not been amended in any
other way other than as set forth in this Amendment.
7. Counterparts. This Amendment may be executed in separate counterparts, each
of which when so executed and delivered shall be deemed an original, but
all of which together shall constitute one and the same instrument.
IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and
year specified at the beginning hereof.
THE COMPANY: EXECUTIVE:
ARLINGTON LODGING GROUP, INC.
/s/ XXXXX X. XXXX
-----------------------------------
XXXXX X. XXXX
By: /s/ XXXXXXX X. XXXXXX
-------------------------------------
By: /s/ Xxxxxxx X. Xxxxxxx
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EXHIBIT A
For the period commencing on the date of this Amendment No. 3 and continuing
through the Term:
1. BASE SALARY. Base salary (the "Base Salary") shall be equal to One Hundred
Sixty Eight Thousand Dollars ($168,000) per year, subject to increase from
time to time as determined in the sole discretion of the Parent's Board of
Directors. This Base Salary shall apply retroactively, as if it were
effective on July 1, 2004 until the date of this Agreement (the "Past
Period"). To effectuate the retroactive payment of the Base Salary, the
Company shall provide Executive with a lump sum payment, subject to
applicable withholding and other taxes, in the amount necessary to
compensate Executive for the increased base salary over the Past Period.
2. INCENTIVE BONUS. Executive shall be eligible to participate in those bonus
and incentive plans and other programs as determined from time to time in
the sole discretion of the Parent's Board of Directors (the "Incentive
Bonus").
3. TRANSITION, PERFORMANCE AND RETENTION BONUS. On December 31, 2005, so long
as Executive is employed by the Company on that date, or, if not employed
by the Company on such date the reason for such unemployment is a
termination by the Company without Cause, Executive shall be entitled to
receive a bonus equal to Ten Thousand Dollars ($10,000) (the "Transition,
Performance and Retention Bonus") if, on or before March 31, 2005,
Executive successfully facilitates the Parent's negotiation, documentation
and closing of an operating line of credit (the "New Line of Credit") for
the Parent to replace the Parent's existing line of credit which it has
with LaSalle Bank and which expires on April 30, 2005 (the "Existing Line
of Credit"), and such New Line of Credit provides for (i) a principal
amount of not less than Four Million Dollars ($4,000,000), (ii) a term of
at least one year, and (iii) interest to accrue at a rate which is less
than that of the Existing Line of Credit.
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