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Exhibit 12
AMENDED AND RESTATED
AGREEMENT
This Amended and Restated Agreement is entered into this 7th day of
October, 1998, by and between RED ROOF INNS, INC., a Delaware corporation, with
principal offices located at 0000 Xxxxxxxx Xxxx, Xxxxxxxx, Xxxx (the "Company")
and XXXXX X. XXX, (the "Executive").
RECITALS
A. Company and Executive have entered into an Agreement as of March 3,
1998 to provide Executive certain severance benefits associated with a change in
control of ownership in the Company. The Company has promoted Executive, and as
a result of such promotion, desires to make certain changes and modification to
the Agreement.
B. Executive is a senior executive of Company who is expected to make
major contributions to the profitability, growth, and financial strength of the
Company.
C. The Company recognizes that upon a threatened change in control
Executive may have concerns about Executive's employment status and
responsibilities, and the Company desires to provide Executive some assurances
as to the continuation of Executive's employment status and responsibilities in
the event of a change in control.
D. The Company desires to assure itself of both present and future
continuity of management in the event of a change in control and desires to
establish certain minimum compensation rights of its key senior executive
officers, including the Executive, applicable in the event of a change in
control.
E. The Company desires to assure that, should it receive an offer
involving a possible change in control, Executive would be in a secure position
to consider such offer and negotiate on behalf of the Company and its
shareholders as objectively as possible, and to this end, the Company desires to
protect Executive from any direct or implied threat to Executive's financial
well-being under such circumstances.
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COVENANTS
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties agree as follows:
1. DEFINITIONS. As used herein, the following terms shall have the
following meanings:
(a) Change in Control. "Change in Control" shall mean
(i) any transaction, or series of transactions,
including, but not limited to any merger, consolidation, or
reorganization, which results when any "person" as defined in
Section 3(a)(9) of the Exchange Act and as used in Sections
13(d) and 14(d) thereof, including a "group" as defined in
Section 13(d) of the Exchange Act, but excluding the Company,
any subsidiary of the Company, and any employee benefit plan
sponsored or maintained by the Company or any subsidiary of
the Company (including any trustee of such plan acting as
trustee), and excluding the Xxxxxx Xxxxxxx Real Estate Fund,
L.P. and its affiliates (as defined in Rule 12b-2 under the
Exchange Act), directly or indirectly, becomes the "beneficial
owner" (as defined in Rule 13d-3 under the Exchange Act) of
securities of the Company representing 20% or more of the
combined voting power of the Company's then outstanding
securities;
(ii) when, during any period of 24 consecutive months
the individuals who, at the beginning of such period,
constitute the Board (the "Incumbent Directors") cease for any
reason other than death to constitute at least a majority of
the Board; provided, however, that a director who was not a
director at the beginning of such 24-month period shall be
deemed to have satisfied such 24-month requirement (and be an
Incumbent Director) if such director was elected by, or on the
recommendation of or with the approval of; at least two-thirds
of the directors who then qualified as Incumbent Directors
either actually (because they were directors at the beginning
of such 24-month period) or by prior operation of this
Section; or
(iii) when the stockholders of the Company approve a
plan of complete liquidation of the Company; or an agreement
for the sale or disposition of substantially all the Company's
assets; or a merger, consolidation, or reorganization of the
Company in which stockholders of the Company immediately prior
to the transaction own less than 65% of the combined voting
power of the surviving entity.
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(b) "Annual Base Salary" shall mean the Executive's current
base annual salary plus any future increases to Executive's base annual
compensation, but in no event less than the Executive's annual base
salary in effect on the date of this Agreement.
(c) "Termination Date" shall mean the date on which
Executive's employment with the Company is terminated.
2. TERMINATION BY COMPANY. Following a Change in Control, the
Executive's employment may be terminated by Company ("Company Termination
Event") and the Executive shall not be entitled to the severance benefits
provided under Section 4, provided that Executive's termination occurs as a
result of one or more of the following events:
(a) The Executive's death;
(b) The Executive's disability, provided Executive actually
begins to receive disability benefits pursuant to the long-term
disability plan in effect for senior executives of the Company
immediately prior to the Change in Control; or
(c) For "Cause," which for purposes of this Agreement shall
mean that, prior to any termination pursuant to Section 3(b) hereof,
the Executive shall have committed: (i) an act of fraud, embezzlement,
theft, or any other act constituting a felony, involving moral
turpitude or causing material harm, financial or otherwise, to the
Company; or (ii) a demonstrably intentional and deliberate act or
failure to act (other than as a result of incapacity due to physical or
mental illness) which is committed in bad faith by the Executive, which
causes or can be expected to cause material financial injury to the
Company.
For purposes of this Agreement, no act, or failure to act, on the part
of the Executive shall be deemed "intentional" if it was due primarily to an
error in judgment or negligence, but shall be deemed "intentional" only if done,
or omitted to be done, by the Executive not in good faith and without reasonable
belief that Executive's action or omission was in, or not opposed to, the best
interest of the Company. Notwithstanding the foregoing, the Executive shall not
be deemed to have been terminated for "Cause" hereunder unless and until there
shall have been delivered to the Executive a copy of a resolution duly adopted
by the affirmative vote of not less than three-quarters of the Board then in
office at a meeting of the Board of Directors called and held for such purpose
(after reasonable notice to the Executive and an opportunity for the Executive,
together with Executive's counsel, to be heard before the Board), finding that,
in the good faith opinion of the Board, the Executive had committed an act set
forth above in this Section 2(c) and specifying the particulars thereof in
detail. Nothing herein shall limit the right of the Executive or Executive's
beneficiaries to contest the validity or propriety of any such determination.
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3. EXECUTIVE TERMINATION EVENT. If at any time during the two-year
period commencing on the date of a Change in Control, the Company or Executive
terminates Executive's employment following the occurrence of one or more of the
following events ("Executive Termination Event"), Executive shall be entitled to
the severance benefits provided in Section 4 below:
(a) Any termination by the Company of Executive's employment
during such two-year period for any reason other than for Cause, as a
result of Executive's death, or by reason of the Executive's disability
and the actual receipt of disability benefits in accordance with
Section 2(b) hereof; or
(b) Termination by the Executive of Executive's employment
with the Company at any time within two years after the Change in
Control upon the occurrence of any of the following events:
(i) The Company's failure to elect, re-elect, or
otherwise maintain the Executive in the office or position in
the Company which the Executive held immediately prior to a
Change in Control, or the removal of the Executive as a
Director of the Company (or any successor thereto) if the
Executive was a Director of the Company immediately prior to
the Change in Control;
(ii) A significant, adverse change (increase or
decrease) in the nature or scope of the authorities, powers,
functions, responsibilities, or duties attached to the
position with the Company which the Executive held immediately
prior to the Change in Control, or a reduction in the
aggregate of the Executive's base pay or annual incentive
bonus opportunity (and relative level of goal achievement) in
which the Executive participated immediately prior to the
Change in Control, or the termination of the Executive's right
to any employee benefits to which Executive was entitled
immediately prior to the Change in Control, or a reduction in
scope or value of such benefits, without prior written consent
of the Executive, any of which is not remedied within 10
calendar days after receipt by the Company of a written notice
from the Executive of such change, reduction, or termination,
as the case may be;
(iii) A determination by the Executive made in good
faith that, as a result of a Change in Control, there has been
a significant change in the scope of the business or other
activities for which the Executive was responsible immediately
prior to the Change in Control, or that Executive has been
rendered substantially unable to carry out, has been
substantially hindered in the performance of, or has suffered
a substantial increase or reduction in, any of the
authorities, powers, functions, responsibilities, or duties
attached to the position held by the Executive immediately
prior to the Change in Control, which situation is not
remedied within 10 calendar days after receipt by the Company
of a written notice from the Executive of such good faith
determination;
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(iv) The liquidation, dissolution, merger,
consolidation, or reorganization of the Company or transfer of
all or a significant portion of its business and/or assets;
(v) The Company shall relocate its principal
executive offices, or require the Executive to have
Executive's principal location of work changed, to any
location which is in excess of 50 miles from the location
thereof immediately prior to the Change in Control, or the
Company shall require the Executive to travel away from
Executive's office in the course of discharging Executive's
responsibilities or duties hereunder significantly more (in
terms of either consecutive days or aggregate days in any
calendar year) than was required of him prior to the Change in
Control without, in either case, Executive's prior written
consent; or
(vi) Without limiting the generality or effect of the
foregoing, any material breach of this Agreement by the
Company or any successor thereto.
4. SEVERANCE BENEFITS. In the event Executive's employment is
terminated within two years of the date of a Change in Control as a result of an
Executive Termination Event, Executive shall be entitled to the benefits set
forth below. All amounts payable under this Section 4(a), (b), and (c) shall be
paid to Executive in one lump sum within 10 days after Executive's termination
of employment.
(a) The Company shall pay to Executive an amount equal to
three times Executive's Annual Base Salary in effect for the year in
which Executive's termination of employment occurs. Executive shall
also be entitled to receive three times the highest bonus or short-term
incentive compensation paid to Executive during the fiscal year
preceding the Change in Control or, if higher, three times the maximum
amount for which Executive has an opportunity to earn in the fiscal
year of Executive's termination (excluding any amounts paid to
Executive under the Company's equity-based, long-term incentive plan or
any other phantom stock or stock rights plan subsequently established
by the Company).
(b) The Company shall pay Executive Executive's full base
salary through Executive's Termination Date. The Company shall also pay
Executive an amount equal to the pro rata amount of the maximum target
bonus award available to Executive under the bonus plan during the year
of termination, based on the number of days of the year elapsed prior
to the Termination Date.
(c) For the 36 months following Executive's termination of
employment, the Company shall arrange to provide the Executive with
health benefits (medical, dental, disability and life) substantially
similar to those which the Executive was receiving or entitled to
receive immediately prior to the Termination Date. If and to the extent
that such benefits shall not or cannot be paid or provided under any
policy, plan, program, or arrangement of the Company solely due to the
fact that the Executive is no longer an officer or employee of the
Company, then the Company shall itself pay or provide
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reimbursement to the Executive, Executive's dependents and
beneficiaries, the cost of such health benefits. Such health benefits
shall be discontinued prior to the end of the specified continuation
period if the Executive receives comparable coverage from a subsequent
employer.
(d) The Company will provide out-placement assistance from a
service selected by Executive for a period of one year from the
Termination Date. All associated costs will be paid by the Company, up
to a maximum of 30% of Executive's annual rate of base pay in effect at
the time of Executive's termination.
(e) If Executive has relocated to work with the Company during
the three years immediately preceding the date of this Agreement,
Executive may elect, within 120 days following the Termination Date, to
have the Company purchase Executive's house at its then current market
value (which shall be established by taking the average of three
appraisals from real estate firms, one selected by the Executive, one
selected by the Company, and one selected by the two selected firms
with the Company paying the costs of the appraisals). Such purchase
shall occur on a date specified by Executive, but in any event within
six months following Executives' election to have the house purchased
by the Company.
5. OTHER RIGHTS. A termination of the Executive's employment by the
Company pursuant to Section 2 or 3(a) hereof, or by the Executive pursuant to
Section 3(b) hereof, shall not affect adversely any rights which the Executive
may have pursuant to any agreement, employment contract, policy, plan, program,
or arrangement of the Company providing employee benefits, which rights shall be
governed by the terms of such employee benefit plan.
6. LONG-TERM INCENTIVES. Upon the occurrence of a Change in Control,
Executive shall become immediately and automatically vested (with no director
discretion exercised) in all equity-based, long-term incentives (including stock
options and restricted stock) and all accrued pension benefits held as of the
date of the Change in Control. To the extent legally necessary the Company can
provide these benefits on a tax non-qualified basis. For any cash-based,
long-term incentive vehicles, Executive shall become immediately vested and
receive an immediate cashout of the vehicles upon the occurrence of a Change of
Control, equal to a pro rata target award thereunder (or, if greater, the actual
award earned to date) based upon the number of days actually employed during the
performance period. Such provisions will be included in all future long-term
incentive award agreements.
7. NO SET-OFF. There shall be no set-off or counterclaim against, or
delay in, any payment of severance benefits by the Company to Executive provided
for in this Agreement with respect to any claim against or debt or obligation of
Executive, whether arising hereunder or otherwise except for health benefits as
provided in Section 4(c).
8. NO MITIGATION OBLIGATION. Executive's benefits hereunder shall be
payable to Executive as severance pay in consideration of Executive's past
services and of Executive's continued services from the date hereof. The Company
hereby acknowledges that it will be difficult, and may be impossible, for the
Executive to find reasonably comparable employment
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following the Termination Date. Accordingly, the parties hereto expressly agree
that the payment of the severance benefits by the Company to the Executive in
accordance with the terms of this Agreement will be liquidated damages, and that
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 any profits, income, earnings, or other benefits from any source whatever
create any mitigation, offset, reduction, or any other obligation on the part of
the Executive hereunder or otherwise except for health benefits as provided in
Section 4 (c).
9. TAX CONSIDERATIONS. Notwithstanding anything herein to the contrary,
in the event any payments to Executive hereunder are determined by the Company
to be subject to the tax imposed by Section 4999 of the Code or any similar
federal or state excise tax, FICA tax, or any interest or penalties are incurred
by the Executive with respect to such excise tax (such excise tax, together with
any such interest or penalties art hereinafter collectively referred to as the
"Excise Tax"), Company shall pay to Executive at the time specified in Section 4
(a) above, an additional amount (the "Gross-Up Payment") such that after the
payment by Executive of all federal, state, or local income taxes, Excise Taxes,
FICA taxes, or other taxes (including any interest or penalties imposed with
respect thereto) imposed upon the receipt of the Gross-Up Payment, Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed on the
severance payments provided herein.
(a) For purposes of determining whether any payments to
Executive hereunder will be subject to the Excise Tax and the amount of
such Excise Tax:
(i) any other payments or benefits received or to be
received by Executive in connection with a Change in Control
or the termination of employment (whether pursuant to the
terms of this Agreement or of any other plan, arrangement, or
agreement with Company) shall be treated as "parachute
payments" within the meaning of Section 280G(b)(2) of the
Code, and all "excess parachute payments" within the meaning
of Section 280G(b)(l) shall be treated as subject to the
Excise Tax, unless in the opinion of tax counsel selected by
Company and acceptable to Executive, other payments or
benefits (in whole or in part) do not constitute parachute
payments under Section 280G of the Code, or such excess
parachute payments (in whole or in part) represent reasonable
compensation for services actually rendered within the meaning
of Section 280G(b)(4) of the Code;
(ii) the amount of the severance payments which shall
be treated as subject to the Excise Tax shall be equal to the
amount of excess parachute payments within the meaning of
Sections 280G(b)(l) and (4) (after applying clause (a),
above); and
(iii) the parachute value of any non-cash benefits or
any deferred payment or benefit shall be determined by Company
in accordance with the principles of Sections 280G(d)(3) and
(4) of the Code.
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(b) If the Excise Tax is subsequently determined to be less
than the amount taken into account hereunder at the time of termination
of employment, Executive shall repay to Company, at the time the
reduction in Excise Tax is finally determined, the portion of the
Gross-Up Payment attributable to such reduction. If the Excise Tax is
determined to exceed the amount taken into account hereunder at the
time of termination of employment, Company shall make an additional
Gross-Up Payment to Executive in respect of such excess at the time the
amount of such excess is finally determined. The Executive shall notify
the Company in writing of any claim by the Internal Revenue Service
that, if successful, would require the payment by the Company of the
Gross-Up Payment. Such notification shall be given as soon as
practicable but no later that ten business days after the Executive is
informed in writing of such claim and shall apprise the Company of the
nature of such claim and the date on which such claim is requested to
be paid. The Executive shall not pay such claim prior to the expiration
of the 30 calendar day period following the date on which it gives such
notice to the Company (or such shorter period ending on the date that
any payment of taxes with respect to such claim is due). If the Company
notifies the Executive in writing prior to the expiration of such
period that it desires to contest such claim, the Executive shall:
(i) give the Company any information reasonably
requested by the Company relating to such claim;
(ii) take such action in connection with contesting
such claim as the Company shall reasonably request in writing
from time to time, including, without limitation, accepting
legal representation with respect to such claim by an attorney
reasonably selected by the Company;
(iii) cooperate with the Company in good faith in
order to effectively contest such claim; and
(iv) permit the Company to participate in any
proceedings relating to such claim;
provided, however, that the Company shall bear and pay directly all
costs and expenses (including legal and accounting fees and additional
interest and penalties) incurred in connection with such contest and
shall indemnify and hold the Executive harmless, on an after-tax basis,
for any Excise Tax, FICA tax, or income tax (including interest and
penalties with respect thereto) imposed as a result of such
representation and payment of costs and expenses. Without limitation on
the foregoing provisions of this Section, the Company shall control all
proceedings taken in connection with such contest and, at its sole
option, may pursue or forgo any and all administrative appeals,
proceedings, hearings, and conferences with the taxing authority in
respect of such claim and may, at its sole option, either direct the
Executive to pay the tax claimed and xxx for a refund or contest the
claim in any permissible manner, and the Executive agrees to prosecute
such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction, and in one or more appellate courts,
as the Company shall determine; provided, however, that if the Company
directs the Executive to pay such claim and xxx
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for a refund, the Company shall advance the amount of such payment to
the Executive, on an interest-free basis, and shall indemnify and hold
the Executive harmless, on an after-tax basis, from any Excise Tax or
income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed
income with respect to such advance; and further provided that any
extension of the statute of limitations relating to payment of taxes
for the taxable year of the Executive with respect to which such
contested amount is claimed to be due is limited solely to such
contested amount. Furthermore, the Company's control of the contest
shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to
settle or contest as the case may be, any other issue raised by the
Internal Revenue Service or any other taxing authority.
If any such claim referred to in this Section is made by the
Internal Revenue Service and the Company does not request the Executive
to contest the claim within the 30 calendar day period following notice
of the claim, the Company shall pay to the Executive the amount of any
Gross-Up Payment owed to the Executive, but not previously paid
pursuant to Section 9(b), immediately upon the expiration of such 30
calendar day period. If any such claim is made by the Internal Revenue
Service and the Company requests the Executive to contest such claim,
but does not advance the amount of such claim to the Executive for
purposes of such contest, the Company shall pay to the Executive the
amount of any Gross-Up Payment owed to the Executive, but not
previously paid under the provisions of Section 9(b), within 5 business
days of a Final Determination of the liability of the Executive for
such Excise Tax. For purposes of this Agreement, a "Final
Determination" shall be deemed to occur with respect to a claim when
(i) there is a decision, judgment, decree, or other order by any court
of competent jurisdiction, which decision, judgment, decree, or other
order has become final, i.e., all allowable appeals pursuant to this
Section have been exhausted by either party to the action, (ii) there
is a closing agreement made under Section 7121 of the Code, or (iii)
the time for instituting a claim for refund has expired, or if a claim
was filed, the time for instituting suit with respect thereto has
expired.
If, after the receipt by the Executive of an amount advanced
by the Company pursuant to this Section, the Executive becomes entitled
to receive any refund with respect to such claim, the Executive shall
(subject to the Company's complying with the requirements of this
Section) promptly pay to the Company the amount of such refund
(together with any interest paid or credited thereon after taxes
applicable thereto). If, after the receipt by the Executive of an
amount advanced by the Company pursuant to this Section, a
determination is made by the Internal Revenue Service that the
Executive is not entitled to any refund with respect to such claim and
the Company does not notify the Executive in writing of its intent to
contest such denial of refund prior to the expiration of 30 calendar
days after such determination, then such advance shall be forgiven and
shall not be required to be repaid and the amount of such advance shall
offset, to the extent thereof, the amount of Gross-Up Payment required
to be paid.
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10. ENFORCEMENT COSTS. Company is aware that, upon the occurrence of a
Change in Control, the Board of Directors or a shareholder of the Company, or
the Company's successor in interest, may then cause or attempt to cause Company
to refuse to comply with its obligations under this Agreement, or may cause or
attempt to cause Company to institute, or may institute litigation seeking to
have this Agreement declared unenforceable, or may take, or attempt to take,
other action to deny Executive the benefits intended under this Agreement. In
these circumstances, the purpose of this Agreement could be frustrated. It is
the intent of Company that Executive not be required to incur the expenses
associated with the enforcement of Executive's rights under this Agreement by
litigation or other legal action, nor be bound to negotiate any settlement of
Executive's rights hereunder under threat of incurring such expenses because the
cost and expense thereof would substantially detract from the benefits intended
to be extended to Executive hereunder. Accordingly, if following a Change in
Control it should appear to Executive that Company has failed to comply with any
of its obligations under this Agreement or in the event that Company or any
other person takes any action to declare this Agreement void or unenforceable,
or institutes any litigation or other legal action designed to deny, diminish,
or to recover from Executive the benefits intended to be provided to Executive
hereunder, Company irrevocably authorizes Executive from time to time to retain
legal counsel of Executive's choice at the expense of Company to represent
Executive in connection with the initiation or defense of any litigation or
other legal action, whether by or against Company or any director, officer,
stockholder, or other person affiliated with Company. The reasonable fees and
expenses of counsel selected from time to time by Executive as provided herein
shall be paid or reimbursed to Executive by Company on a regular, periodic basis
upon presentation by Executive of a statement or statements prepared by
Executive's counsel in accordance with its customary practices. In any action
involving this Agreement, Executive shall be entitled to prejudgment interest on
any amounts found to be due Executive as of the date such amounts would have
been payable to Executive pursuant to this Agreement at an annual rate of
interest equal to the lesser of 10% or the prime commercial rate in effect at
The Huntington National Bank in Columbus, Ohio from time to time during the
pre-judgment period.
11. ARBITRATION. Without limiting the application of Section 10 above,
the Company and Executive hereby agree that certain issues and/or disagreements
arising in connection with this Agreement shall be settled by arbitration.
Accordingly, in the event the Company or Executive believes that the other party
has violated any provision of this Agreement, including but not limited to any
action by the Company which Executive believes would entitle Executive to
terminate Executive's employment with severance benefits in accordance with
Section 3(b) hereof, the party alleging such violation shall notify the other
party in writing of such alleged violation. In the event the party receiving
such violation notice disagrees with the position taken by the other party in
such written notice, the recipient of the violation notice may, within 20 days
of receipt of such written notice, notify the other party, in writing, that it
has elected to submit such disagreement to arbitration. Arbitration of such
dispute shall be settled in Columbus, Ohio, in accordance with the then
applicable rules of the American Arbitration Association. The Company shall bear
all costs associated with such arbitration. In the event the party receiving a
violation notice does not elect to submit any issue or disagreement to
arbitration within 10 days of its receipt of the written violation notice, such
party will be deemed to have accepted the position taken in such written notice.
Notwithstanding anything herein to the contrary, neither
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the Company nor the Executive shall be required to arbitrate the basis of any
involuntary termination of Executive's employment with the Company by the
Company or its successor.
12. EMPLOYMENT RIGHTS. Nothing expressed or implied in this Agreement
shall create any right or duty on the part of the Company or the Executive to
have the Executive remain in the employment of the Company prior to any Change
in Control, provided, however, that any termination of employment or the removal
of the Executive from the office or position in the Company that such Executive
presently holds following the commencement of active negotiations with a third
party (which negotiations are evidenced by the delivery of evaluation material)
that ultimately results in a Change in Control shall be deemed to be a
termination or removal of the Executive after a Change in Control for purposes
of this Agreement. Notwithstanding the foregoing, a termination of employment or
removal of the Executive following the termination of active negotiations with
any third party shall not be deemed a termination after a Change in Control for
purposes of this Agreement.
13. TERM. This Agreement shall terminate on October 7, 2001, unless a
Change in Control shall have occurred prior to such date; provided, however,
upon the passage of one year from the date hereof and each year thereafter this
Agreement shall automatically be renewed for an additional year unless the
Company or the Executive has notified in writing the other sixty calendar days
prior to the passage of the year that the Agreement is not to be automatically
renewed. Upon such notice, this Agreement will not be renewed for the additional
year and will expire at the end of the three-year term then in process.
Regardless of the term remaining on this Agreement determined as provided above,
upon the occurrence of a Change of Control of the Company this Agreement shall
not terminate or expire until two years from the date of such Change of Control.
14. WITHHOLDING OF TAXES. The Company may withhold from any amounts
payable under this Agreement all federal, state, city or other taxes as shall be
required pursuant to any law or government regulation or ruling.
15. SUCCESSORS AND BINDING AGREEMENT.
(a) The Company shall require any successor (whether direct or
indirect, by purchase, merger, consolidation, reorganization, or
otherwise) to all or substantially all of the business and/or assets of
the Company, by agreement in form and substance satisfactory to the
Executive, expressly to assume and agree to perform this Agreement in
the same manner and to the same extent the Company would be required to
perform if no such succession had taken place. This Agreement shall be
binding upon and inure to the benefit of the Company and any successor
to the Company, including without limitation any persons acquiring
directly or indirectly all or substantially all of the business and/or
assets of the Company whether by purchase, merger, consolidation,
reorganization, or otherwise (and such successor shall thereafter be
deemed the "Company" for the purposes of this Agreement), but shall not
otherwise be assignable, transferable, or delegable by the Company.
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(b) This Agreement shall inure to the benefit of and be
enforceable by the Executive's personal or legal representatives,
executors, administrators, successors, heirs, distributees, or
legatees.
(c) This Agreement is personal in nature and neither of the
parties hereto shall, without the consent of the other, assign,
transfer, or delegate this Agreement or any rights or obligations
hereunder except as expressly provided in Section 13(a) hereof. Without
limiting the generality of the foregoing, the Executive's right to
receive payments hereunder shall not be assignable, transferable, or
delegable, whether by pledge, creation of a security interest, or
otherwise, other than by a transfer by Executive's will or by the laws
of descent and distribution and, in the event of any attempted
assignment or transfer contrary to this Section 12(c), the Company
shall have no liability to pay any amount so attempted to be assigned,
transferred, or delegated.
(d) The Company and the Executive recognize that each party
will have no adequate remedy at law for breach by the other of any of
the agreements contained herein and, in the event of any such breach,
the Company and the Executive hereby agree and consent that the other
shall be entitled to a decree of specific performance, mandamus or
other appropriate remedy to enforce performance of this Agreement.
16. NOTICE. For all purposes of this Agreement, all communications
including without limitation notices, consents, requests, or approvals, provided
for herein, shall be in writing and shall be deemed to have been duly given when
delivered or five business days after having been mailed by United States
registered or certified mail, return receipt requested, postage prepaid,
addressed to the Company (to the attention of the President of the Company) at
its principal executive office and to the Executive at Executive's principal
residence, or to such other address as any party may have furnished to the other
in writing and in accordance herewith, except that notices of change of address
shall be effective only upon receipt.
17. GOVERNING LAW. The validity, interpretation, construction, and
performance of this Agreement shall be governed by the laws of the State of
Ohio, without giving effect to the principles of conflict of laws of such State.
18. VALIDITY. If any provision of this Agreement or the application of
any provision hereof to any person or circumstances is held invalid,
unenforceable, or otherwise illegal, the remainder of this Agreement and the
application of such provision to any other person or circumstances shall not be
affected, and the provision so held to be invalid, unenforceable, or otherwise
illegal shall be reformed to the extent (and only to the extent) necessary to
make it enforceable, valid, and legal.
19. MISCELLANEOUS. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing signed by the Executive and the Company. No waiver by either party
hereto at any time of any breach by the other party hereto or compliance with
any condition or provision of this Agreement to be performed by such other party
shall be deemed a waiver of similar or dissimilar provisions or conditions at
the same or at any prior or subsequent time. No agreements or representations,
oral
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or otherwise, expressed or implied with respect to the subject matter hereof
have been made by either party which are not set forth expressly in this
Agreement. In the event the terms and conditions of this Agreement conflict with
those of any other agreement, this Agreement shall prevail.
To the extend that Executive receives payment under this Agreement
relating to the termination of Executive's employment, the Executive will not
receive payment under any other agreement with the Company regarding such
termination.
THIS AGREEMENT IS AN AMENDED AND RESTATED AGREEMENT OF THE ORIGINAL
AGREEMENT AND SUPERSEDES THE ORIGINAL AGREEMENT IN ITS ENTIRETY.
IN WITNESS WHEREOF, the Executive and Company have executed this
Agreement on the day and year first above written.
EXECUTIVE RED ROOF INNS, INC.
By: /s/ XXXXX X. XXX By: /s/ XXXXXXX X. XXXX
------------------------------- -------------------------------
XXXXX X. XXX XXXXXXX X. XXXX
Executive Vice President, Chairman, President, and
Chief Financial Officer, and Chief Executive Officer
Treasurer
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