EXHIBIT 10.87
EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the "Agreement") is entered into by and between
CNL HOSPITALITY PROPERTIES, INC., a Maryland corporation (hereinafter referred
to as the "Company"), and C. Xxxxx Xxxxxxxxxx (hereinafter referred to as the
"Executive") and is effective as of the Effective Date hereinbelow defined at
Section 7.19.
WHEREAS, the Agreement and Plan of Merger (the "Agreement and Plan of
Merger") dated April __, 2004, between the Company; CNL HOSPITALITY PROPERTIES
ACQUISITION CORP., a Maryland corporation and wholly owned subsidiary of the
Company; CNL HOSPITALITY CORP., a Florida corporation (the "Advisor"); and the
principal stockholders of the Advisor contemplates that the Company enter into
an employment agreement with the Executive;
WHEREAS, the Company wishes to offer employment to the Executive, and the
Executive wishes to accept such offer, on the terms set forth below;
Accordingly, the parties hereto agree as follows:
1. Term. The Company hereby employs the Executive, and the Executive
hereby accepts such employment for an initial term commencing as of the
Effective Date and ending on December 31, 2007, unless sooner terminated in
accordance with the provisions of Section 4 or Section 5 (the period during
which the Executive is employed hereunder being hereinafter referred to as the
"Term"). The Term shall be subject to automatic one- (1-) year renewals unless
either party hereto notifies the other, in accordance with Section 7.6, of
non-renewal at least ninety (90) days prior to the end of any such Term.
2. Duties. The Executive, in his capacity as Executive Vice President
shall faithfully perform for the Company the duties of said office and shall
perform such other duties of an executive, managerial or administrative nature
as shall be specified and designated from time to time by the Board of Directors
of the Company (the "Board") (including the performance of services for, and
serving on the Board of Directors of, any subsidiary of the Company without any
additional compensation). The Executive shall devote substantially all of the
Executive's business time and effort to the performance of the Executive's
duties hereunder, provided that in no event shall this sentence prohibit the
Executive from performing personal and charitable activities and any other
activities approved by the Board, so long as such activities do not interfere
with the Executive's duties for the Company.
3. Compensation.
3.1 Salary. The Company shall pay the Executive during the Term a
salary at the rate of $475,000 per annum (the "Annual Salary"), in accordance
with the customary payroll practices of the Company applicable to senior
executives generally. Annual Salary may be increased annually on January 1 of
each year commencing in 2006 by an amount as may be
approved by the Board or the Compensation Committee of the Board of Directors
(the "Compensation Committee"), with such increase to be effective on the date
salary increases are effective for employees of the Company generally and, upon
such increase, the increased amount shall thereafter be deemed to be the Annual
Salary.
3.2 Bonus. The Executive will be eligible to participate in the
Company's annual bonus program (the "Bonus Plan"), the terms of which will be
established by the Executive Compensation Committee of the Company; provided,
however, at a minimum, Executive shall be eligible for such bonus compensation
as is set forth on Attachment A attached hereto and made a part hereof by this
reference.
3.3 Benefits - In General. The Executive shall be permitted during
the Term to participate in any group life, hospitalization or disability
insurance plans, health programs, pension and profit sharing plans and similar
benefits that may be available to other senior executives of the Company
generally, on the same terms as may be applicable to such other executives
(except as otherwise provided in this Section 3), in each case to the extent
that the Executive is eligible under the terms of such plans or programs.
3.4 Paid Time Off. The Executive shall be entitled to no fewer than
twenty-five (25) days of paid time off per year.
3.5 Automobile. The Company will provide the Executive a monthly
allowance of $500 for the use of an automobile. At the option of the Company, in
lieu of providing such allowance, the Company will provide the Executive with an
automobile of suitable standard to the Executive's position.
3.6 Disability Benefits and Life Insurance. To the extent the
Company's group life and disability insurance plans do not provide this level of
benefits, the Executive shall be entitled to additional benefits so that his
long-term disability coverage provides benefits (to continue for such period as
is provided in the applicable disability plan or program, as amended from time
to time, and with waiting periods and pre-existing condition exceptions waived
to the extent such coverage is available on commercially reasonable terms) equal
seventy-five percent (75%) of his Annual Salary in the case of a covered
disability and life insurance coverage provides benefits with a face amount
equal to two (2) times his Annual Salary up to a maximum of One Million and
No/00 Dollars ($1,000,000.00) of life insurance.
3.7 Expenses. The Company shall pay or reimburse the Executive for
all ordinary and reasonable out-of-pocket expenses actually incurred (and, in
the case of reimbursement, paid) by the Executive during the Term in the
performance of the Executive's services under this Agreement; provided that the
Executive submits such expenses in accordance with the policies applicable to
senior executives of the Company generally.
4. Termination upon Death or Disability. If the Executive dies during the
Term, the obligations of the Company to or with respect to the Executive shall
terminate in their entirety except as otherwise provided under this Section 4 or
under Section 5.2. If the Executive becomes eligible for disability benefits
under the Company's long-term disability plans and arrangements (or, if none
apply, would have been so eligible under the most recent plan or arrangement),
the
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Company shall have the right, to the extent permitted by law, to terminate the
employment of the Executive upon at least ninety (90) days written notice to the
Executive; provided that the Company will have no right to terminate the
Executive's employment if, in the opinion of a qualified physician reasonably
acceptable to the Company, it is reasonably certain that the Executive will be
able to resume the Executive's duties on a regular full-time basis within ninety
(90) days of the date the Executive receives notice of such termination. Upon
death or other termination of employment by virtue of disability, (i) the
Executive (or the Executive's estate or beneficiaries in the case of the death
of the Executive) shall have no right to receive any compensation or benefit
hereunder on and after the effective date of the termination of employment other
than Annual Salary and other benefits (but excluding any bonuses except as
provided in the Bonus Plan or in clause (ii) below) earned and accrued under
this Agreement prior to the date of termination (and excluding reimbursement
under this Agreement for expenses incurred prior to the date of termination);
(ii) the Executive (or the Executive's estate or beneficiaries in the case of
the death of the Executive) shall be entitled to a cash payment equal to the
Executive's Annual Salary (as in effect on the effective date of such
termination) payable no later than thirty (30) days after such termination;
(iii) all of the Executive's outstanding and unvested Founder's Stock (as
defined in Attachment A), and all of the Executive's unvested options to acquire
shares of Company stock shall immediately vest and such options shall remain
exercisable by Executive, or, in the case of death, by the beneficiaries of
Executive's estate, for one (1) year following such termination (or, if shorter,
the balance of the regular term of the options); (iv) Executive's outstanding
and unvested Incentive Stock (as defined in Attachment A) that would vest in the
calendar year of such termination shall, subject to the approval of the
Compensation Committee, become vested; and (v) this Agreement shall otherwise
terminate upon such death or other termination of employment and there shall be
no further rights with respect to the Executive hereunder (except as provided in
Section 7.15). The payments to be made above shall be in addition to, rather
than in lieu of, the entitlement of Executive or his estate to any other
insurance or benefit proceeds as a result of his death or disability.
5. Certain Terminations of Employment.
5.1 Termination for Cause; Termination of Employment by the
Executive Without Good Reason.
(a) For purposes of this Agreement, "Cause" shall mean:
(i) the Executive's (A) conviction for (or pleading nolo
contendere to) any felony, or a misdemeanor involving moral
turpitude, or (B) indictment for any felony or misdemeanor involving
moral turpitude, if such indictment is not discharged or otherwise
resolved within eighteen (18) months;
(ii) the Executive's commission of an act of fraud,
theft or dishonesty related to the performance of the Executive's
duties hereunder;
(iii) the willful and continuing failure or habitual
neglect by the Executive to perform the Executive's duties
hereunder;
(iv) any material violation by the Executive of the
covenants
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contained in Section 6; or
(v) the Executive's willful and continuing material
breach of this Agreement.
Notwithstanding the foregoing, if there exists (without regard to this sentence)
an event or condition that constitutes Cause under clause (iii) or (v) above,
the Executive shall have thirty (30) days from his receipt of such notice of
such event or condition to cure such event or condition and, if the Executive
does so, such event or condition shall not constitute Cause hereunder.
(b) For purposes of this Agreement, "Good Reason" shall mean,
unless otherwise consented to by the Executive:
(i) the material reduction of the Executive's authority,
duties and responsibilities, or the assignment to the Executive of
duties materially inconsistent with the Executive's position or
positions with the Company and its subsidiaries;
(ii) a reduction in Annual Salary of the Executive
except in connection with a reduction in compensation generally
applicable to senior management employees of the Company;
(iii) the failure by the Company to obtain an agreement
in form and substance reasonably satisfactory to the Executive from
any successor to the business of the Company to assume and agree to
perform this Agreement; or
(iv) the Company's material and willful breach of this
Agreement.
(v) a requirement by the Company that Executive's work
location be moved more than fifty (50) miles of the Company's
principal place of business in Orlando, Florida.
For purposes of this Agreement, a good faith determination of "Good Reason" made
by the Executive shall be conclusive. Notwithstanding the foregoing, if there
exists (without regard to this sentence) an event or condition that constitutes
Good Reason under clause (i), (ii) or (iv) above, the Company shall have thirty
(30) days from the date on which the Executive gives the notice thereof to cure
such event or condition and, if the Company does so, such event or condition
shall not constitute Good Reason hereunder.
(c) The Company may terminate the Executive's employment
hereunder for Cause. If the Company terminates the Executive for Cause, (i) the
Executive shall have no right to receive any compensation or benefit hereunder
on and after the effective date of the termination of employment other than
Annual Salary and other benefits (but excluding any bonuses except as provided
in the Bonus Plan) earned and accrued under this Agreement prior to the
effective date of the termination of employment (and Executive shall be entitled
to reimbursement under this Agreement for expenses incurred prior to the
effective date of the termination of employment); and (ii) this Agreement shall
otherwise terminate upon such
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termination of employment and the Executive shall have no further rights
hereunder (except as provided in Section 7.15)
(d) The Executive may terminate his employment without Good
Reason. If the Executive terminates the Executive's employment with the Company
without Good Reason: (i) the Executive shall have no right to receive any
compensation or benefit hereunder on and after the effective date of the
termination of employment other than Annual Salary and other benefits (but
excluding any bonuses except as provided in the Bonus Plan) earned and accrued
under this Agreement prior to the effective date of the termination of
employment (and Executive shall be entitled to reimbursement under this
Agreement for expenses incurred prior to the effective date of the termination
of employment); and (ii) this Agreement shall otherwise terminate upon such
termination of employment and the Executive shall have no further rights
hereunder (except as provided in Section 7.15).
5.2 Termination Without Cause; Termination for Good Reason;
Non-renewal of Employment Agreement. The Company may terminate the Executive's
employment at any time for any reason or no reason and the Executive may
terminate the Executive's employment with the Company for Good Reason. If the
Company or the Executive terminates the Executive's employment and such
termination is not described in Section 4 or Section 5.1 or if the Company, for
any reason, does not renew this Agreement at the expiration of its Term and
Executive's employment terminates, (i) other than as set forth in this Section
5.2, the Executive shall have no right to receive any compensation or benefit
hereunder on and after the effective date of the termination of employment other
than Annual Salary and other benefits (but excluding any bonuses except as
provided in the Bonus Plan and clause (ii) below) earned and accrued under this
Agreement prior to the effective date of the termination of employment (and
Executive shall be entitled to reimbursement under this Agreement for expenses
incurred prior to the effective date of the termination of employment); (ii) the
Executive shall receive (A) cash payments equal to two (2) times the sum of (w)
the Executive's Annual Salary (as in effect on the effective date of such
termination) plus (x) the average of the Executive's Annual Bonus actually
earned for the two of the last three full fiscal years that would result in the
highest average ("Average Annual Bonus"), payable in equal installments over the
period that corresponds to the period during which the covenants provided in
Section 6.1(a) hereof are to be applicable in accordance with the Company's
usual and customary payroll practices, commencing on the first payday following
Executive's termination, provided, however, that in the event the termination of
employment is in connection with the Company not renewing this Agreement, such
payments shall equal the sum of (y) the Executive's Annual Salary (as in effect
on the effective date of such termination) plus (z) the Executive's Average
Annual Bonus, payable in equal installments over a twelve (12) month period in
accordance with the Company's usual and customary payroll practices, commencing
on the first payday following Executive's termination provided, further, that if
the covenants provided in Section 6.1(a) are not applicable, in a single lump
sum within five (5) days of termination of employment; and (B) for a period of
one (1) year after termination of employment such continuing health benefits
(including any medical, vision or dental benefits), under the Company's health
plans and programs applicable to senior executives of the Company generally as
the Executive would have received under this Agreement (and at such costs to the
Executive) as would have applied in the absence of such termination or
expiration (but not taking into account any post-termination increases in Annual
Salary that may otherwise have occurred without regard to such termination and
that may have favorably affected such benefits) it being expressly
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understood and agreed that nothing in this clause (ii) (B) shall restrict the
ability of the Company to amend or terminate such plans and programs from time
to time in its sole discretion; provided, however, that the Company shall in no
event be required to provide such coverage after such time as the Executive
becomes entitled to receive health benefits from another employer or recipient
of the Executive's services (and provided, further, that such entitlement shall
be determined without regard to any individual waivers or other arrangements);
(iii) all of the Executive's outstanding and unvested Founder's Stock (as
defined in Attachment A), and unvested options to acquire shares of Company
stock shall immediately vest and such options shall remain exercisable by
Executive, or, in the case of death, by the beneficiaries of Executive's estate,
for one (1) year following such termination (or, if shorter, the balance of the
regular term of the options); (iv) Executive's outstanding and unvested
Incentive Stock (as defined in Attachment A) that would vest in the calendar
year of such termination shall, subject to the approval of the Compensation
Committee, become vested; and (v) this Agreement shall otherwise terminate upon
such termination of employment and the Executive shall have no further rights
hereunder (except as provided in Section 7.15).
6. Covenants of the Executive.
6.1 Covenant Against Competition; Other Covenants. The Executive
acknowledges that (i) the principal business of the Company is the acquisition,
development and ownership of interests in hotel and resort properties including
full service hotels and resorts, limited service hotels, extended stay hotels
and upper upscale and luxury resorts (such business, and any and all other
businesses that after the date hereof, and from time to time during the Term,
become material with respect to the Company's then-overall business, herein
being collectively referred to as the "Business"); (ii) the Company knows of a
limited number of persons who have developed the Company's Business; (iii) the
Company's Business is, in part, national in scope; (iii) the Executive's work
for the Company and its subsidiaries (and the predecessors of either) has given
and will continue to give the Executive access to the confidential affairs and
proprietary information of the Company and to "trade secrets", as defined in
Section 688.002(4) of the Florida Statutes, the Company and its subsidiaries;
(v) the covenants and agreements of the Executive contained in this Section 6
are essential to the business and goodwill of the Company; and (vi) the Company
would not have entered into this Agreement but for the covenants and agreements
set forth in this Section 6. In light of the foregoing, during the Term and (i)
in the case of a termination by the Company for Cause, a termination by the
Company without Cause, a termination by the Executive without Good Reason or a
termination of Executive's employment after non-renewal of this Agreement, for a
period of one (1) year and (ii) as to Section 6.1(b) and (d), at any time during
and after the Executive's employment with the Company and its subsidiaries (and
the predecessors of either),
(a) The Executive shall not, directly or indirectly, own, manage,
control or participate in the ownership, management, or control of, or be
employed or engaged by or otherwise affiliated or associated as an employee,
employer, consultant, agent, principal, partner, stockholder, corporate officer,
director or in any other individual or representative capacity, engage or
participate in any business with assets in excess of $500 million that is in
competition in any manner whatsoever with the Business of the Company in any
state or country or other jurisdiction in which the Company conducts its
Business; provided, however, that, notwithstanding the foregoing, (i) the
Executive may own or participate in the ownership of any
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entity which he owned or managed or participated in the ownership or management
of prior to the Effective Date hereof which ownership, management or
participation has been disclosed to the Company; and (ii) the Executive may
invest in securities of any entity, solely for investment purposes and without
participating in the business thereof, if (A) such securities are traded on any
national securities exchange or the National Association of Securities Dealers,
Inc. Automated Quotation System, (B) the Executive is not a controlling person
of, or a member of a group which controls, such entity and (C) the Executive
does not, directly or indirectly, own one percent (1%) or more of any class of
securities of such entity.
(b) The Executive shall keep secret and retain in strictest
confidence, and shall not use for his benefit or the benefit of others, except
in connection with the business and affairs of the Company and its affiliates,
all confidential matters relating to the Company's Business and the business of
any of its affiliates and to the Company and any of its affiliates, learned by
the Executive heretofore or hereafter directly or indirectly from the Company or
any of its subsidiaries (or any predecessor of either) (the "Confidential
Company Information"), including, without limitation, information with respect
to the Business and any aspect thereof, profit or loss figures, and the
Company's or its affiliates, (or any of their predecessors) properties, and
shall not disclose such Confidential Company information to anyone outside of
the Company except with the Company's express written consent and except for
Confidential Company Information which (i) at the time of receipt or thereafter
becomes publicly known through no wrongful act of the Executive; (ii) is clearly
obtainable in the public domain; (iii) was not acquired by the Executive in
connection with the Executive's employment or affiliation with the Company; (iv)
was not acquired by the Executive from the Company or its representatives or
from a third-party who has an agreement with the Company not to disclose such
information; or (v) is required to be disclosed by rule of law or by order of a
court or governmental body or agency.
(c) The Executive shall not, without the Company's prior
written consent, directly or indirectly, (i) knowingly solicit or encourage to
leave the employment or other service of the Company or any of its affiliates,
any employee thereof or hire (on behalf of the Executive or any other person or
entity) any employee who has left the employment or other service of the Company
or any of its affiliates (or any predecessor of either) within one (1) year of
the termination of such employee's or independent contractor's employment or
other service with the Company and its affiliates; or (ii) whether for the
Executive's own account or for the account of any other person, firm,
corporation or other business organization, intentionally interfere with the
Company's or any of its affiliates, relationship with, or endeavor to entice
away from the Company or any of its affiliates, any person who during the
Executive's employment with the Company and its affiliates (or the predecessors
of either) is or was a customer or client of the Company or any of its
affiliates (or any predecessor of either).
(d) All memoranda, notes, lists, records, property and any
other tangible product and documents (and all copies thereof) made, produced or
compiled by the Executive or made available to the Executive concerning the
Business of the Company and its affiliates shall be the Company's property and
shall be delivered to the Company at any time on request.
6.2 Rights and Remedies upon Breach. The Executive acknowledges and
agrees that any breach by him of any of the provisions of Section 6.1 (the
"Restrictive Covenants")
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would result in irreparable injury and damage for which money damages would not
provide an adequate remedy. Therefore, if the Executive breaches, or threatens
to commit a breach of, any of the Restrictive Covenants, the Company and its
affiliates shall have the right and remedy to have the Restrictive Covenants
specifically enforced (without posting bond and without the need to prove
damages) by any court having equity jurisdiction, including, without limitation,
the right to an entry against the Executive of restraining orders and
injunctions (preliminary, mandatory, temporary and permanent) against
violations, threatened or actual, and whether or not then continuing, of such
covenants. This right and remedy shall be in addition to, and not in lieu of,
any other rights and remedies available to the Company and its affiliates under
law or in equity (including, without limitation, the recovery of damages). The
existence of any claim or cause of action by the Executive, whether predicated
on this Agreement or otherwise, shall not constitute a defense to the
enforcement of the Restrictive Covenants. The Company has the right to cease
making the payments provided in Section 5.2 in the event of a material breach of
any of the Restrictive Covenants.
7. Other Provisions.
7.1 Severability. The Executive acknowledges and agrees that (i) the
Executive has had an opportunity to seek advice of counsel in connection with
this Agreement; and (ii) the Restrictive Covenants are reasonable in
geographical and temporal scope and in all other respects. If it is determined
that any of the provisions of this Agreement, including, without limitation, any
of the Restrictive Covenants, or any part thereof, is invalid or unenforceable,
the remainder of the provisions of this Agreement shall not thereby be affected
and shall be given full affect, without regard to the invalid portions.
7.2 Duration and Scope of Covenants. If any court or other decision
maker of competent jurisdiction determines that any of the Executive's covenants
contained in this Agreement, including, without limitation, any of the
Restrictive Covenants, or any part thereof, are unenforceable because of the
duration or geographical scope of such provision, then, after such determination
has become final and unappealable, the duration or scope of such provision, as
the case may be, shall be reduced so that such provision becomes enforceable
and, in its reduced form, such provision shall then be enforceable and shall be
enforced.
7.3 Enforceability of Restrictive Covenants; Jurisdictions. The
Company and the Executive intend to and hereby confer jurisdiction to enforce
the Restrictive Covenants upon the courts of any jurisdiction within the
geographical scope of the Restrictive Covenants. If the courts of any one or
more of such jurisdictions hold the Restrictive Covenants wholly unenforceable
by reason of breadth of scope or otherwise it is the intention of the Company
and the Executive that such determination not bar or in any way affect the
Company's right, or the right of any of its affiliates, to the relief provided
above in the courts of any other jurisdiction within the geographical scope of
such Restrictive Covenants, as to breaches of such Restrictive Covenants in such
other respective jurisdictions, such Restrictive Covenants as they relate to
each jurisdiction's being, for this purpose, severable, diverse and independent
covenants, subject, where appropriate, to the doctrine of res judicata.
7.4 Arbitration. Except with regard to Section 6, all disputes
between the parties or any claims concerning the performance, breach,
construction or interpretation of this
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Agreement, or in any manner arising out of this Agreement, shall be submitted to
binding arbitration in accordance with the Commercial Arbitration Rules, as
amended from time to time, of the American Arbitration Association (the "AAA"),
which arbitration shall be carried out in the manner set forth below:
(a) Within fifteen (15) days after written notice by one party to
the other party of its demand for arbitration, which demand
shall set forth the name and address of its designated
arbitrator, the other party shall appoint its designated
arbitrator and so notify the demanding party. Within fifteen
(15) days thereafter, the two arbitrators so appointed shall
appoint the third arbitrator. If the two appointed arbitrators
cannot agree on the third arbitrator, then the AAA shall
appoint an independent arbitrator as the third arbitrator. The
dispute shall be heard by the arbitrators within ninety (90)
days after appointment of the third arbitrator. The decision
of any two (2) or all three (3) of the arbitrators shall be
binding upon the parties without any right of appeal. The
decision of the arbitrators shall be final and binding upon
the Company, its successors and assigns, and upon Executive,
his heirs, personal representatives, and legal
representatives.
(b) The arbitration proceedings shall take place in Orlando,
Florida, and the judgment and determination of such
proceedings shall be binding on all parties. Judgment upon any
award rendered by the arbitrators may be entered into any
court having competent jurisdiction without any right of
appeal.
(c) Each party shall pay its or his own expenses of arbitration,
and the expenses of the arbitrators and the arbitration
proceeding shall be shared equally. However, if in the opinion
of a majority of the arbitrators, any claim or defense was
unreasonable, the arbitrators may assess, as part of their
award, all or any part of the arbitration expenses of the
other party (other than attorneys' fees which are covered in
Section 7.5 below) and of the arbitrators and the arbitration
proceeding.
7.5 Attorneys' Fees. In the event of any legal proceeding (including
an arbitration proceeding) relating to this Agreement or any term or provision
thereof, the losing party shall be responsible to pay or reimburse the
prevailing party for all reasonable attorneys' fees incurred by the prevailing
party in connection with such proceeding.
7.6 Notices. Any notice or other communication required or permitted
hereunder shall be in writing and shall be delivered personally, telegraphed,
telexed, sent by facsimile transmission or sent by certified, registered or
express mail, postage prepaid. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission or,
if mailed, five days after the date of deposit in the United States mails as
follows:
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(i) If to the Company, to:
CNL Hospitality Properties, Inc.
CNL Center at City Commons
000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxx X. Xxxxxx, Xx.
Facsimile: (000) 000-0000
with a copy in either case to:
Xxxxxxxxx Traurig, LLP
The MetLife Building
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxx, Esq.
Facsimile: (000) 000-0000
(ii) If to the Executive, to:
C. Xxxxx Xxxxxxxxxx
000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxx 00000
with a copy in either case to:
Xxxxx & Xxxxxxxxx LLP
SunTrust Center
000 Xxxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
Attention: G. Xxxxxx Xxxx, Esq.
Facsimile: (000) 000-0000
Any such person may by notice given in accordance with this Section to the other
parties hereto designate another address or person for receipt by such person of
notices hereunder.
7.7 Entire Agreement. This Agreement contains the entire agreement
between the parties with respect to the subject matter hereof and supersedes all
prior agreements, written or oral, with the Company or its subsidiaries (or any
predecessor of either).
7.8 Waivers and Amendments. This Agreement may be amended,
superseded, canceled, renewed or extended, and the terms hereof may be waived,
only by a written instrument signed by the parties or, in the case of a waiver,
by the party waiving compliance. No delay on the part of any party in exercising
any right, power or privilege hereunder shall operate as a waiver thereof, nor
shall any waiver on the part of any party of any such right, power or privilege
nor any single or partial exercise of any such right, power or privilege,
preclude any other or further exercise thereof or the exercise of any other such
right, power or privilege.
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7.9 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAW.
7.10 Assignment. This Agreement, and the Executive's rights and
obligations hereunder, may not be assigned by the Executive; any purported
assignment by the Executive in violation hereof shall be null and void. In the
event of any sale, transfer or other disposition of all or substantially all of
the Company's assets or business, whether by merger, consolidation or otherwise,
the Company may assign this Agreement and its rights hereunder.
7.11 Withholding. The Company shall be entitled to withhold from any
payments or deemed payments any amount of withholding required by law. No other
taxes, fees, impositions, duties or other charges or offsets of any kind shall
be deducted or withheld from amounts payable hereunder, unless otherwise
required by law.
7.12 No Duty to Mitigate. The Executive shall not be required to
mitigate damages or the amount of any payment provided for under this Agreement
by seeking other employment or otherwise, nor will any payments hereunder be
subject to offset in the event the Executive does mitigate.
7.13 Binding Effect. This Agreement shall be binding upon and inure
to the benefit of the parties and their respective successors, permitted
assigns, heirs, executors and legal representatives.
7.14 Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
shall be an original but all such counterparts together shall constitute one and
the same instrument. Each counterpart may consist of two copies hereof each
signed by one of the parties hereto.
7.15 Survival. Anything contained in this Agreement to the contrary
notwithstanding, the provisions of Sections 5, 6 , 7.3, 7.4, 7.5, 7.11, and 7.12
and the other provisions of this Section 7 (to the extent necessary to
effectuate the survival of Sections 5, 6 , 7.3, 7.4, 7.11, and 7.12) shall
survive the termination of this Agreement and any termination of the Executive's
employment hereunder.
7.16 Existing Agreements. Executive represents to the Company that
the Executive is not subject or a party to any employment or consulting
agreement, non-competition covenant or other agreement, covenant or
understanding which might prohibit the Executive from executing this Agreement
or limit the Executive's ability to fulfill the Executive's responsibilities
hereunder.
7.17 Headings. The headings in this Agreement are for reference only
and shall not affect the interpretation of this Agreement.
7.18 Parachute Provisions. If any amount payable to or other benefit
receivable by the Executive pursuant to this Agreement is deemed to constitute a
Parachute Payment (as defined below), alone or when added to any other amount
payable or paid to or other benefit receivable or received by the Executive
which is deemed to constitute a Parachute Payment
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(whether or not under an existing plan, arrangement or other agreement), and
would result in the imposition on the Executive of an excise tax under Section
4999 of the Internal Revenue Code of 1986, as amended, then, in addition to any
other benefits to which the Executive is entitled under this Agreement, the
Executive shall be paid by the Company an amount in cash equal to the sum of the
excise taxes payable by the Executive by reason of receiving Parachute Payments
plus the amount necessary to put the Executive in the same after-tax position
(taking into account any and all applicable federal, state and local excise,
income or other taxes at the highest applicable rates on such Parachute Payments
and on any payments under this Section 7.18) as if no excise taxes had been
imposed with respect to Parachute Payments. The amount of any payment under this
Section 7.18 shall be computed by a certified public accounting firm mutually
and reasonably acceptable to the Executive and the Company, the computation
expenses of which shall be paid by the Company. "Parachute Payment" shall mean
any payment deemed to constitute a "parachute payment" as defined in Section
280G of the Internal Revenue Code of 1986, as amended.
7.19 Effective Date. The Effective Date of this Agreement is the
effective date of the merger between the Company and the Advisor contemplated in
the Agreement and Plan of Merger as determined by applicable law.
IN WITNESS WHEREOF, the parties hereto have signed their names as of the
day and year set forth below.
CNL HOSPITALITY PROPERTIES, INC.:
By: /s/ Xxxxxx X. Xxxxxxxxx, III
Name: Xxxxxx X. Xxxxxxxxx, III
Title: CEO CNL Hospitality Properties, Inc.
Date: 04/30/04
EXECUTIVE:
/s/ C. Xxxxx Xxxxxxxxxx
Date: April 29, 2004
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EMPLOYMENT AGREEMENT
ATTACHMENT "A"
(As Amended)
A. BONUS COMPENSATION
1. Annual Bonus Compensation. Executive shall be eligible to participate
the Bonus Plan during the term of this Agreement. Executive's bonus will be
subject to Executive's achievement of performance criteria established annually
by the Compensation Committee:
1.1. For Threshold level, Executive shall receive 50% of his Annual
Salary as bonus compensation.
1.2. For Target level, Executive shall receive 100% of his Annual
Salary as bonus compensation.
1.3. For Maximum level, Executive shall receive 150% of his Annual
Salary as bonus compensation.
Any bonus compensation in excess of 125% of Executive's Annual Salary will be
paid in shares of the Company's common stock. Executive's performance criteria
shall be established annually by the Compensation Committee. For each year,
Executive's bonus, if any, will be paid to Executive in a lump sum on or before
ninety (90) days after the end of such fiscal year.
2. Withholding. All amounts payable to Executive hereunder shall be
subject to all required federal or state income tax withholding by Company.
B. OTHER BENEFITS AND PAYMENTS
1. Travel. Executive shall be entitled to use any private airplane owned
or leased by the Company when traveling on Company business. If for any reason
such private airplane is not available for such travel, Executive shall use
travel arrangements that are in accordance with the Company's policy on travel
by senior management. Executive shall be entitled to personal use of any such
airplane on a plane and space availability basis (personal use to be additional
compensation to Executive).
2. Use of Hotel Properties. Executive shall be entitled to use the
Company's hotel and resort properties for business and personal purposes in
accordance with the policies approved by the Board relating to the use of hotel
and resort properties by senior management and members of the Board.
3. Incentive Stock. Subject to the approval of the 2004 Omnibus Long-Term
Plan at the Company's 2004 annual meeting of stockholders, as an incentive
bonus, shares of the Company's common stock ("Incentive Stock") shall be granted
to the Executive in accordance with the following:
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3.1. Incentive Stock shall be granted to the Executive in reward for
the Executive's service and achievement of certain performance criteria, which
performance criteria shall be established and determined by the Compensation
Committee.
3.2. A total of 520,000 shares of Incentive Stock shall be granted
in the form of deferred stock. Two and nine-tenths percent (2.9 %) of the shares
of Incentive Stock shall be granted and released to the Executive if he is
continuously employed by the Company from the Effective Date through December
31, 2004, five and seven-tenths percent (5.7%) of the shares of Incentive Stock
shall be granted and released to the Executive if he is continuously employed by
the Company from the Effective Date through December 31, 2005, five and
seven-tenths percent (5.7%) of the shares of Incentive Stock shall be granted
and released to the Executive if he is continuously employed by the Company from
the Effective Date through December 31, 2006, and five and seven-tenths percent
(5.7%) of the shares of Incentive Stock shall be granted and released to the
Executive if he is continuously employed by the Company from the Effective Date
through December 31, 2007. The remaining shares of Incentive Stock shall be
granted and released based on the achievement of performance criteria over
semi-annual, annual and cumulative performance periods ending December 31, 2007,
as determined by the Compensation Committee.
4. Founder's Stock. Subject to the approval of the 2004 Omnibus Long-Term
Plan at the Company's 2004 annual meeting of stockholders, an allocation of
175,000 shares of the Company's common stock in the initial public offering of
the Company (the "Founder's Stock") shall be granted to the Executive no later
than the closing of the initial public offering of Company stock and the right
to dispose of such stock shall vest in three (3) equal installments on each of
the first three anniversaries of the Effective Date (or earlier as provided in
the Agreement) if Executive has been continuously employed by the Company from
the Effective Date to such anniversary provided that all other rights with
respect to such stock (including the right to vote and the right to receive
dividends) shall vest immediately (subject to forfeiture if the unvested shares
are forfeited on termination of employment, except as otherwise provided in the
Agreement.)
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IN WITNESS OF THE PARTIES AGREEMENT TO THIS ATTACHEMENT "A" (AS AMENDED),
the parties hereto have signed their names as of the day and year set forth
below.
CNL HOSPITALITY PROPERTIES, INC.:
By: _______________________________
Name: _____________________________
Title: ____________________________
Date: _____________________________
EXECUTIVE:
____________________________________
Date: ______________________________
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