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EXHIBIT 10.12
EXECUTIVE EMPLOYMENT AGREEMENT
This Executive Employment Agreement ("Agreement") dated
November ___, 1994 is entered into by and between Xxxxxxx X. Xxxxx ("Executive")
and Hotel Investors Trust, a Maryland real estate investment trust ("the
Company"). This Agreement is effective as of the Closing Date ("the Closing
Date") set forth in Section 1.2 of that certain Formation Agreement dated
November 11, 1994 by and between the Company, Hotel Investors Corporation
("HIC"), Starwood Capital Group, L.P. and others.
The Company desires the continued services of the Executive in
the capacity described below, on the terms and conditions and subject to the
rights of termination hereinafter set forth, and the Executive is willing to
accept such employment on such terms and conditions.
In consideration of the mutual agreements hereinafter set
forth, the Executive and the Company agree as follows:
ARTICLE I
Capacity and Services
1.1 The Company hereby employs the Executive as President
and Chief Operating Officer of the Company to perform such executive and
managerial duties commensurate with such office as he shall reasonably be
directed by the Chief Executive Officer, if that position is held by Xxxxx X.
Xxxxxxxxxx ("Sternlicht"), and otherwise by the Board of Trustees of the Company
(the "Board of Trustees"). During the term of the Executive's employment
hereunder, he shall devote his full business time and efforts to the business
and affairs of the Company, shall use his best efforts to supply his skill and
experience to perform his duties and to promote the interests of the Company and
shall have no other employment without the prior approval of the Board of
Trustees.
1.2 The principal office of the Company shall be located
in Los Angeles, California at all times prior to December 31, 1995.
1.3 The Executive's duties and authority hereunder shall
be commensurate with the title and status afforded him hereunder, taking into
account the expected participation of Sternlicht in the management of the
Company. During the term of the Executive's employment hereunder, the Company
shall not hire or fire any officer of the Company without either a determination
by the Board of Trustees or (except for the hiring or firing of the Chief
Executive Officer) the prior consent of Executive.
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1.4 The Executive hereby accepts such employment and
agrees to render to the Company the services specified in this Article I and to
be bound by the terms and conditions of this Agreement.
ARTICLE II
Term
2.1 The term of the Executive's employment hereunder shall
commence on the Closing Date and expire on the second anniversary of the Closing
Date (the "Termination Date") unless sooner terminated pursuant to Article VI
hereof.
ARTICLE III
Compensation and Expenses
3.1 Base Salary. As compensation for the Executive's
services during the term of the Executive's employment hereunder, the Company
shall pay the Executive a base salary at the annual rate of $200,000 through the
first anniversary of the Closing Date and $225,000 thereafter (the "Base
Salary") payable in equal monthly installments or at such other times as the
Executive and the Company shall agree. The Base Salary shall be reviewed at
least annually by the Board of Trustees and may be increased as determined by
the Board of Trustees if, and to the extent that, the Board of Trustees
determines that the Executive's contribution to the Company warrant such
increase. Executive's Base Salary shall not be decreased at any time during the
term of his employment hereunder from the Base Salary then in effect.
3.2 Incentive Compensation. In addition to the Base
Salary, the Company shall pay the Executive during the term of his employment
hereunder an annual incentive bonus (the "Bonus"), in a lump-sum payment within
30 days of the end of each calendar year (excluding 1994) in an amount (no less
than $75,000 respecting each of 1995 and 1996) determined in the discretion of
the Board of Trustees based on the performance of the Executive and his
contribution to the Company during such calendar year.
3.3 Expenses. The Company shall reimburse the Executive
for all reasonable and necessary business expenses incurred by him in connection
with the performance by him of his duties hereunder.
3.4 Vacation. The Executive shall be entitled to such
number of vacation days in each calendar year as determined by the Company from
time to time for its senior executives but not less than four weeks in each
calendar year which may be accumulated or used by the Executive; provided,
however, up to 8
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weeks of unused vacation time may be accumulated by Executive and at his option
be compensated for upon termination of his employment (at the rate of Base
Salary then in effect).
3.5 Indemnification; Officers and Directors Insurance. As
a trustee and officer of the Company, the Executive shall be entitled to the
benefits of those provisions of the Declaration of Trust of the Company, as
amended, which provide for indemnification of officers and trustees of the
Company, and of the bylaws or the equivalent regulations of the Company. No such
provision shall be amended to any way limit or reduce the extent of
indemnification available to Executive as an officer or trustee of the Company.
In addition, to the fullest extent permitted by law, the
Company shall indemnify and save and hold harmless the Executive from and
against any and all claims, demands, liabilities, costs and expenses, including
judgments, fines or amounts paid on account thereof (whether in settlement or
otherwise), and reasonable expenses, including attorneys fees actually and
reasonably incurred (except only if and to the extent that such amounts shall be
finally adjudged to have been caused by Executive's willful breach of the
express provisions of this Agreement) to the extent that the Executive is made a
party to or witness in any action, suit or proceeding or if a claim or liability
is asserted against Executive (whether or not in the right of the Company), by
reason of the fact that he was or is a trustee or officer or acted in such
capacity on behalf of the Company, or by reason of or arising out of or
resulting from entering into this Agreement or the rendering of services by the
Executive pursuant to this Agreement, whether or not the same shall proceed to
judgment or be settled or otherwise be brought to a conclusion. The Company
shall advance to Executive on demand all reasonable expenses incurred by
Executive in connection with the defense or settlement or any such claim,
action, suit or proceeding, and Executive hereby undertakes to repay such
amounts only if and to the extent that it shall be finally adjudged that the
Executive is not entitled to be indemnified by the Company under this Agreement
or under the Declaration of Trust or the bylaws or equivalent regulations of the
Company as of the date hereof which govern indemnification of officers or
trustees of the Company (but also giving effect only to future amendments which
broaden or expand any such indemnification and obligations or right more
favorably to Executive). Executive shall also be entitled to recover any cost of
enforcing his rights under this Section (including without limitations
reasonable attorneys fees and disbursements) in the event any amount payable
hereunder is not paid within 30 days of written request therefor by Executive.
The rights of Executive under this Section shall survive the termination of this
Agreement and be applicable for so long as Executive may be subject to any
claim, demand, liability, cost or expense against which this Section is intended
to protect and indemnify him.
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Notwithstanding anything contained in this Agreement to the
contrary (including the provisions of Article VI hereof), the Company shall, at
no cost to the Executive, use its best efforts to at all times include the
Executive during the term of the Executive's employment hereunder and for a
period of not less than four years thereafter, as an insured under any directors
and officers liability insurance policy maintained by the Company, which policy
shall provide such coverage in such amounts as the Board of Trustees shall deem
appropriate for coverage of all trustees and officers of the Company.
3.6 Other Employee Benefits. During the term of this
Agreement, the Company shall pay the premium (not to exceed $9,000 annually) for
the Executive to purchase and maintain a disability insurance policy, which
policy shall guarantee to Executive the payment to him of amounts and benefits
no less than those described in the attached letter dated October 27, 1994 from
Xxxx X. Xxxxxxxx to Madison Xxxxx, Esq., for the period of such disability.
During the term of this Agreement, Executive shall also be entitled to
participate in any benefit programs adopted from time to time by the Company for
the benefit of any executive employee, and Executive shall be entitled to
receive such other fringe benefits as may be granted to him from time to time by
the Company's Board of Trustees. During the term of this Agreement, the
Executive shall also be entitled to participate in any benefit plans relating to
stock options, stock purchases, pension, thrift, profit sharing, life insurance,
medical coverage for Executive and members of his family, education, or other
retirement or employee benefits similar or dissimilar to the foregoing,
available to any other executive employee of the Company, subject to any
restrictions (including waiting periods) specified in such plans.
Notwithstanding the foregoing, Executive shall participate in and receive the
benefit of any and all fringe benefits made available to any other executive
employee of the Company to at least the same extent and at least the same
benefit as any other executive employee (this provision being intended to afford
Executive "most favored nation" treatment with respect to any and all fringe
benefits (all benefits other than cash salary, bonus, stock options and stock
loans) granted to any executive employee of the Company). "Most favored nation
treatment" for Executive shall not extend to stock options or stock loans, the
minimal provisions for which are as set forth in this Agreement, or to salaries
and bonuses; as to all such items, the Company reserves the right to award
greater benefits to other executives without affording such greater benefits to
Executive. Further, the Company agrees to adopt benefits and programs at least
as beneficial for its executives as HIC adopts for its executives.
3.7 Stock Options. Executive shall be entitled to
receive options to purchase 250,000 paired shares of the Company and HIC, as
presently constituted, at a purchase price equal to market value on the date of
grant (which shall be the Closing
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Date), exercisable for a period of 10 years, exercisable after termination of
employment or expiration of the term of this Agreement for no less than one
year. The aforesaid options for 250,000 paired shares shall be adjusted for any
split or reverse split (i.e., reduced proportionately for any reverse split and
increased proportionately for any split). The aforesaid options shall vest at a
rate which is no longer than the most rapid rate of vesting of options granted
to any other executive during the term of this Agreement. In the event such
vesting period shall extend beyond the term of this Agreement, such options
shall nonetheless continue to vest on behalf of Executive even after expiration
or termination of this Agreement, except as provided in Article VI hereof, and
shall in all events be exercisable for a period of at least one year following
complete vesting of such options; and the foregoing provisions with respect to
vesting and exercisability of options shall be applicable notwithstanding any
provision or provisions to the contrary in any plan or agreement pursuant to
which such options may be granted, these provisions accordingly for such purpose
constituting an amendment to any such plan or agreement of the Company. However,
options shall not vest to the extent that, at any time prior to the applicable
vesting date, this Agreement shall have been terminated by the Company for
"cause" (as hereinafter defined) or if and to the extent it shall be finally
adjudged prior to a vesting date that Executive has materially breached his
Article IV covenants following the termination of this Agreement. Stock options
shall be subject to such other customary terms and provisions as are generally
contained in option agreements received by other executives or Trustees of the
Company.
3.8 Loan to Purchase Shares. At the first public offering
by the Company occurring during the term of this Agreement, Executive shall have
the right to purchase up to $250,000 of paired shares (at the offering price)
and to receive a loan from the Company to purchase such shares (the "Stock
Loan") in an amount equal to 100% of the purchase price for such shares. The
Stock Loan: (i) shall be secured by a first lien pledge of the shares purchased
with such Stock Loan, (ii) shall be evidenced by a note executed by Executive
and such other documentation as the Company may reasonably require; (iii) shall
be a recourse loan to Executive to the extent of 50% of the principal amount
thereof from time to time and 50% of all interest thereon and all collection
costs accruing from time to time; (iv) shall not exceed a principal amount of
$250,000; (v) shall have a term of 10 years; (vi) shall bear interest at a rate
equal to the lowest applicable federal rate (as defined in Section 1274(d) of
the Internal Revenue Code of 1986, as amended) from time to time, with said
interest to be paid quarterly in arrears; (vii) shall be prepayable in whole or
in part at any time and from time to time without prepayment premium or penalty;
(vii) shall be due on sale or other transfer at any time or from time to time of
the collateral therefor (in a ratable amount of principal based on the number of
paired shares so sold or
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transferred); and (viii) shall provide for delinquency charges and collection
costs as are customary in loans of this nature; and (ix) shall provide that all
dividends paid on the pledged shares in excess of the then maximum marginal tax
rate (federal and state combined) on the taxable portions of such dividends will
be used to pay interest and principal on the loan. In lieu of making the loan
itself, the Company may cause a third party to make such loan.
ARTICLE IV
Restrictive Covenants
4.1 Other Business Ventures. In addition to the
restriction from having other employment provided in Section 1.1 hereof, during
the term of the Executive's employment hereunder the Executive shall not,
without the prior approval of the Board of Trustees, directly or indirectly,
engage in, represent, be connected with or have a financial interest in, any
business which is or, to the best of his knowledge, is about to become
competitive with the business of the Company; provided, however, that nothing
herein contained shall be deemed to prohibit the Executive from being a passive
investor owning up to 2% of any class of outstanding securities of any company
whose stock is publicly traded, or from being a passive investor owning up to
10% of any other person, firm or corporation engaged in any business whatever.
4.2 Confidential Information. Except (i) in the course of
his employment with the Company, (ii) as he may be required pursuant to any law
or court order or similar process, or (iii) in connection with any claim by
Executive against the Company, Executive shall not at any time during or after
the term of Executive's employment hereunder, directly or indirectly disclose or
use any confidential information or proprietary data with respect to the
Company, HIC or any of their respective subsidiaries or Affiliates that is not
otherwise in the public domain. In the event of any dispute between the
Executive and the Company or between the Executive or the Company and others,
Executive shall cooperate with the Company as to redaction or other protective
measures with respect to any unnecessary public disclosure of any such
confidential information or proprietary data.
4.3 Inducing of Company Employees. During the term of the
Executive's employment hereunder, the Executive shall not, except in the course
of the performance of his duties hereunder or with the prior approval of the
Board of Trustees, in any way directly or indirectly induce or attempt to induce
or otherwise counsel, advise or encourage any person to leave the employment of
the Company. In addition, in the event that the Executive's employment hereunder
shall be terminated pursuant to any of
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Section 6.1 or Section 6.3 hereof, the Executive shall not, with respect to any
person or persons (other than his assistant, Xxxxx Xxxxxx) who, to the
Executive's best knowledge, was employed by the Company, HIC or their respective
subsidiaries or SLT Realty Limited Partnership or SLC Operating Limited
Partnership at any time during the period commencing six months prior to the
date such termination becomes effective pursuant to Section 6.5 hereof ("Company
Employee"):
(i) for a period of 12 months following the date on
which such termination becomes effective as aforesaid, in any way
directly or indirectly hire, attempt to hire, or cause to be hired any
Company Employee, without the prior approval of the Board of Trustees;
and
(ii) for a period of 12 months following the date on
which such termination becomes effective as aforesaid, in any way
directly or indirectly induce or attempt to induce or otherwise
counsel, advise or encourage any Company Employee to leave the
employment of the Company, HIC or their respective subsidiaries or SLT
Realty Limited Partnership or SLC Operating Limited Partnership,
without the prior approval of the Board of Trustees.
4.4 (Intentionally Omitted)
4.5 Default in Payment; Failure to Exercise.
Notwithstanding anything contained in this Agreement to the contrary in the
event that the Company shall have failed to make any required payment pursuant
to Article VI hereof, and such failure to pay shall have continued for a period
of 20 days after the date on which written notice specifying such failure and
requiring the Company to remedy the same shall have been given to the Company by
the Executive, then, without waiving any other rights the Executive may
otherwise have with respect thereto, the Executive shall not be obligated to
comply with any of the provisions of Section 4.3 hereof.
ARTICLE V
Representations and Warranties of Executive
5.1. The Executive hereby represents and warrants to the
Company that the Executive is not aware of any presently existing fact,
circumstance or event (including, without limitation, any health condition)
which would preclude or restrict him from providing to the Company the services
provided for in this Agreement, or which would give rise to any breach of any
term or provision hereof or which could otherwise result in the termination of
his employment hereunder for cause pursuant to Section 6.1 hereof.
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ARTICLE VI
Termination
6.1 Termination of Employment for Cause. The Company
shall have the right during the term of this Agreement to terminate this
Agreement and the Executive's employment hereunder for cause if, and only if,
the Board of Trustees shall give notice to the Executive of such termination
pursuant to Section 6.5 hereof. "Cause," as used in this Agreement, shall mean
the Executive's:
(i) material breach of this Agreement, consisting of
(x) any repeated gross or willful refusal, failure or neglect by the
Executive fully and faithfully to perform his duties and fulfill his
obligations under this Agreement (which shall include, without
limitation, any such refusal, failure or neglect resulting from the
Executive's excessive absenteeism not related to physical or mental
illness), and (y) any material breach of the Executive's fiduciary
duties under Maryland law as an officer or trustee of the Company; or
(ii) conviction of a felony.
In the event that the Executive's employment hereunder is terminated by the
Company for cause in accordance with this Section 6.1, all of the Company's
obligations under this Agreement shall forthwith cease and terminate on the date
such termination shall become effective pursuant to Section 6.5 hereof,
including, without limitation, any obligation to pay any compensation or provide
any other benefit pursuant to Article III hereof; provided, however, that the
Executive shall be entitled to receive (i) payment for any unpaid portion of the
Base Salary then in effect pursuant to Section 3.1 hereof, prorated to the
effective date of such termination, and (ii) payment or reimbursement of any
expenses pursuant to Section 3.3 hereof which he would otherwise have been
entitled to receive as of the effective date of such termination.
6.2 Death. In the event that the Executive shall die
during the term of this Agreement, all of the Company's obligations under this
Agreement shall terminate on the date of such death, except that the Executive's
estate shall be entitled to receive (i) the Basic Benefits, and (ii) any Bonus
with respect to any prior fiscal year which the Executive was entitled to
receive as of the date of his death pursuant to Section 3.2 hereof but which the
Company had not yet paid to the Executive as of such date, and (iii) payment or
reimbursement of any expenses pursuant to Section 3.3 hereof which he would
otherwise have been entitled to receive as of the effective date of such
termination.
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6.3 Disability. In the event of the Executive's Disability
during the term of this Agreement for any period (the "Disability Period") of at
least six consecutive months, all of the Company's obligations under this
Agreement shall forthwith cease and terminate if, and only if, the Company shall
give the notice provided for in Section 6.5 hereof, in which case such
termination shall become effective on the date set forth in such Section 6.5,
except that the Executive shall be entitled to receive (i) the Basic Benefits,
(ii) any Bonus with respect to any prior fiscal year which the Executive was
entitled to receive pursuant to Section 3.2 hereof but which the Company had not
yet paid to Executive, (iii) disability payments from the Company at the rate of
$225,000 per annum, payable in equal monthly installments, until the earlier of
ninety days after such effective date of termination or the date on which the
Executive is entitled to begin receiving payments under the policy provided for
in Section 3.6 hereof, and (iv) the Fringe Benefits.
The term "Disability" as used in this Section 6.3 shall mean the inability of
the Executive to perform his employment services hereunder by reason of physical
or mental illness or incapacity, whether voluntary or involuntary and whether
arising out of sickness, accident or otherwise.
6.4 Termination By Executive for Good Reason. Executive
may terminate this Agreement for "Good Reason". For purposes of this Agreement,
"Good Reason" shall mean the occurrence, without the Executive's express written
consent, of any one or more of the following events:
(i) The assignment of any duties which are in any
significant respect inconsistent with Executive's status as Chief Operating
Officer of the Company or a substantial alteration (including and without
limitation any material diminution) in the nature or status of Executive's
responsibilities involving the Company from those in effect at the Closing Date,
which inconsistent assignment or substantial alteration is not remedied or cured
forthwith following Executive's notification to the Company.
(ii) Any failure by the Company to provide any of the
compensation or benefits to be made available to the Executive under this
Agreement, which is not cured forthwith following Executive's notification to
the Company.
(iii) Any other breach of the terms of this Agreement by the
Company, which is not cured forthwith following Executive's notification to the
Company.
(iv) The removal or suspension from office without "cause"
of the Executive as President and Chief Operating Officer of the Company or the
failure without "cause" to elect or appoint the Executive as either the
President and Chief Operating Officer
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or as the Chief Executive Officer, of the Company throughout the term of this
Agreement.
(v) The relocation of Company's principal executive
offices to a location more than 25 miles from its location as of the Closing
Date (unless the Executive shall not have given notice of termination under this
clause (v) within 30 days subsequent to his receipt from the Company of formal
notification that the Company's principal executive offices will be so
relocated), or the Company's requiring Executive at any time to be based
anywhere other than the Company's principal executive offices, except for
required travel on the Company's business to an extent substantially consistent
with Executive's present business travel obligations.
(vi) If individuals who as of the date of the Closing Date
constitute the Board of Trustees of the Company, cease for any reason to
constitute at least 51% of such Board.
(vii) A decision by the Board of Trustees after the Closing
Date to the effect that the Company shall merge or consolidate, or sell,
transfer or otherwise dispose of all or substantially all of its assets, or
dissolve or liquidate.
(viii) The failure of Executive for any reason other than
"cause" to be a member of the Board of Trustees of the Company.
In the event of any such termination, which shall become
effective on the date set forth in Section 6.5 hereof, the Executive shall be
entitled to receive the following (which, so long as Madison Xxxxx, Esq. is a
Trustee of the Company and is employed by and acts as Counsel to Starwood
Capital Group, L.P. and Sternlicht, and otherwise in the absence of bad faith or
willful breach by the Company, shall be Executive's sole and exclusive monetary
remedy by reason of such termination due to the occurrence of such "Good Reason"
event, it being agreed that, as actual damages would be difficult to measure or
quantify and it would be impracticable to determine same, the following shall,
so long as Madison Xxxxx, Esq. is a Trustee of the Company and is employed by
and acts as Counsel to Starwood Capital Group, L.P. and Sternlicht, and
otherwise in the absence of bad faith or willful breach by the Company
constitute liquidated damages for Executive by reason of such termination due to
the occurrence of such "Good Reason" event):
(i) The Basic Benefits
(ii) The Lump Sum Payment
(iii) The Fringe Benefits
(b) As used in Article VI:
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(i) "Basic Benefits" shall mean (y) any unpaid portion of
the Base Salary in effect as of the date termination of employment is effective,
prorated to such effective date, (z) any Bonus for the then current fiscal year
of the Company, prorated to such effective date.
(ii) "Lump-Sum Payment" shall mean a single payment to be
paid to the Executive by the Company, within five days from the date of
termination, in an amount equal to the sum of (x) an amount equal to all Base
Salary that would have been payable to Executive pursuant to this Agreement had
the Executive continued to be employed for the remaining unexpired term of this
Agreement and (y) an amount equal to all Bonuses that would have been payable to
Executive respecting the remaining unexpired term of this Agreement as his
annual Bonus for each year(s) or portion thereof of such remaining unexpired
term, being equal, as to any year or fraction thereof of such remaining
unexpired term, to (A) the greater of $6,250 or one-twelfth of Executive's Bonus
for the most recently concluded fiscal year of the Company prior to the fiscal
year of the Company in which the termination occurs, multiplied by (B) the
number of whole and partial calendar months remaining in the unexpired term of
this Agreement.
(iii) "Fringe Benefits" shall mean all fringe benefits set
forth in Sections 3.5 through 3.8 throughout the remaining unexpired term of the
Agreement, as if the Executive's employment under the Agreement had not been
terminated. If, as a result of termination of Executive's employment, Executive
or his otherwise eligible dependents or beneficiaries shall become ineligible
for benefits in any one or more of the Company's benefit plans, then throughout
such remaining unexpired term of the Agreement, as if Executive's employment
under the Agreement had not been terminated, the Company shall continue to
provide the Executive and his eligible dependents or beneficiaries with benefits
at a level at least equivalent to the level of benefits for which the Executive
and his dependents and beneficiaries were eligible under such plans immediately
prior to the termination date.
"Fringe Benefits" shall also include, notwithstanding any
provision of any applicable Company benefit plan or agreements (including but
not limited to those relating to stock options, stock appreciation rights,
restricted stock awards, stock purchases, pensions, thrift, profit sharing or
other retirement or employee benefits) to the contrary, all rights to such
benefits previously granted to Executive, which shall as of the termination date
become immediately fully vested and exercisable by the Executive and shall
remain exercisable for a period of not less than one year. These provisions of
Section 6.4 shall be applicable, notwithstanding any provisions to the contrary
in any such plans or agreements of the Company referred to above as of the date
of termination. Notwithstanding the foregoing and in clarification thereof,
Fringe Benefits shall not include the right to receive any stock options or
stock loans
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which have not been granted to Executive prior to the date of termination.
6.4.1 Executive shall not be required in any way to
mitigate the amount of any payment provided for in this Section 6.4, including
but not limited to seeking other employment, nor shall the amount of any payment
provided for in this Section 6.4 be reduced by any compensation or other income
earned or received by Executive as the result of employment with another
employer or otherwise after the date of termination of his employment hereunder.
6.5 Notice of Termination. The Company shall give notice
to the Executive of any termination by the Company pursuant to any of Section
6.1 or Section 6.3 hereof, as the case may be, and such termination shall become
effective (i) with respect to termination pursuant to Section 6.1 hereof, only
if such notice is given within 30 days after the Chief Executive Officer or the
Board of Trustees becomes aware of the occurrence of the "cause" referred to in
Section 6.1, and if such notice is so given, on the date such notice is given,
(ii) with respect to termination pursuant to Section 6.3 hereof, only if such
notice is given within 30 days of the end of the Disability Period referred to
in such Section 6.3 hereof, and if such notice is so given, on the thirtieth day
after such notice is given. Termination pursuant to Section.6.2 hereof shall
become effective immediately on the date of the Executive's death and no notice
shall be required with respect to such termination. Termination by the Executive
under Section 6.4 shall become effective 30 days after notice from Executive to
Company.
6.6 Disputed Termination. If the Executive resigns his
employment with the Company alleging in good faith as the basis for such
resignation any of the grounds specified in Section 6.4 and if the Company then
disputes Executive's rights to the payment of benefits under Section 6.4, the
Company shall nonetheless continue to pay Executive the full compensation
(including but not limited to his Base Salary, Bonus and Fringe Benefits) in
effect on the date Executive provided notice of such resignation, and the
Company shall continue the Executive as a participant in all compensation
benefits and insurance plans in which the Executive was then a participant,
until the earlier of the Termination Date or the date the dispute is finally
resolved, either by mutual written agreement of the parties or by decree of a
court of competent jurisdiction that is not appealable or with respect to which
the time for appeal has expired and no appeal has been perfected. For purposes
of this Section, there shall be a rebuttable presumption that an event occurred
constituting "Good Reason" under Section 6.4 and that the Executive alleged such
grounds in good faith.
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Article VIII
Definitions
In addition to the terms defined elsewhere in this Agreement, the
following terns shall have the following meanings for purposes of this
Agreement:
8.1. Affiliate. "Affiliate" shall mean, with respect to
any specified individual or entity, any individual or entity that directly, or
indirectly, through one or more intermediaries, controls or is controlled by, or
is under common control with, the individual or entity specified.
8.2. Closing Date. The "Closing Date" shall mean, the
date of the closing to be held pursuant to the terms and conditions of the
Formation Agreement.
Article IX
General
9.1 Governing Law. This Agreement shall be governed by,
and construed, interpreted and enforced in accordance with, the internal laws of
the State of California without reference to principles of conflict of laws.
9.2 Captions. The Article and Section headings contained
herein are for reference purposes only and shall not in any way affect the
meaning or interpretation of this Agreement.
9.3 Entire Agreement. This Agreement sets forth the entire
agreement and understanding of the parties hereto with respect to the subject
matter hereof, and supersedes all prior agreements, arrangements and
understandings, written or oral, between the parties hereto. Upon the Closing
Date this Agreement shall supersede in its entirety all prior employment
agreements between Executive and the Company.
9.4 No Other Representations. No representation, promise
or inducement has been made by either party hereto that is not embodied in this
Agreement, and neither party shall be bound by or liable for any alleged
representation, promise or inducement not set forth herein.
9.5 Assignability. This Agreement is personal in its
nature. Accordingly, this Agreement and the rights and obligations of the
parties hereunder may not be assigned or delegated by either party, except to
the extent, if any, that the Company's acting as general partner of SLT Realty
Limited Partnership may be deemed an assignment by the Company.
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9.6 Amendments; Waivers. This Agreement may be amended,
modified, superseded, cancelled, renewed or extended and the terms or covenants
hereof may be waived, but only by a written instrument executed by Executive and
the Company, or, in the case of a waiver, by the party waiving compliance. The
failure of either party at any time or times to require performance of any
provision hereof shall in no manner affect such party's right at a later time to
enforce the same. No waiver by either party of the breach of any term or
covenant contained in this Agreement, whether by conduct or otherwise, in any
one or more instances, shall be deemed to be, or construed as, a further or
continuing waiver of any such breach, or a waiver of the breach of any other
term or covenant contained in this Agreement.
9.7 Termination of Agreement. Notwithstanding anything in
this Agreement to the contrary, if the Closing to be held pursuant to the
Formation Agreement shall not have taken place on or prior to February 28, 1995,
this Agreement and all of the rights and obligations of the parties hereunder
shall terminate and be null and void and of no force, and effect and neither of
the parties hereto shall have any liability or obligation to the other.
9.8 Legal Expenses. Whether or not the Closing under the
Formation Agreement shall take place, the Company shall pay or reimburse the
Executive for all reasonable fees and disbursements of the Executive's counsel.
In the event any arbitration or judicial determination becomes necessary of any
dispute arising as to the parties' rights and obligations hereunder, the Company
shall bear the reasonable attorneys fees and costs of Executive's counsel,
except if and to the extent it shall be finally adjudged that such dispute was
caused by Executive's willful breach of the express provisions of this
Agreement.
9.9 Approval of the Board of Trustees. Whenever approval
of the Board of Trustees shall be required to be obtained pursuant to this
Agreement, such approval shall not be unreasonably withheld and shall be deemed
to have been obtained if (i) evidenced by a resolution duly adopted by the Board
of Trustees, (ii) otherwise set forth in any duly recorded minutes of any
meeting of the Board of Trustees, or (iii) evidenced by any written instrument
signed by any trustee (other than the Executive) on behalf of the Board of
Trustees.
9.10 Severability. Any term or provision of this Agreement
which is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective only to the extent of such prohibition or
unenforceability without invalidating or affecting any other term or provision
hereof, and any such prohibition or unenforceability in any jurisdiction
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shall not invalidate or render unenforceable such term or provision in any other
jurisdiction.
9.11 Notices. All notices and other communications
required or provided for under this Agreement shall be in writing and shall be
personally delivered or sent by registered or certified mail, postage prepaid,
with return receipt requested, or sent by telegram, telex, telecopy or similar
form of telecommunication, and shall be deemed to have been given when
received. Any such notice or communication shall be addressed, (a) if to the
Company or the Board of Trustees, to the office or residence of the Chief
Executive Officer and any Trustee of the Company who shall not be an officer or
employee of the Company, or to such other address and/or to the attention of
such other person as the Board of Trustees shall have furnished to the
Executive in writing, or (b) if to the Executive, to 0000 Xxxxxxxxx Xxxxx,
Xxxxxxx Xxxxxxxxx, Xxxxxxxxxx 00000, or to such other address as the Executive
shall have furnished to the Compensation Committee in writing.
9.12 Beneficiaries. Whenever this Agreement provides for
any payment to the Executives estate, such payment may be made instead to such
beneficiary or beneficiaries as the Executive may have designated in writing and
filed with the Company. The Executive shall have the right to revoke any such
designation from time to time and to redesignate any beneficiary or
beneficiaries by written notice to the Company.
9.13 Disclaimer. The name "Hotel Investors Trust" is a
designation of a Maryland real estate investment trust and its trustees (as
trustees but not personally) under a Declaration of Trust dated as of August 15,
1969, as amended, and all persons dealing with such trust must look solely to
such trust property for enforcement of any claims against such trust, a the
trustees officers, agents and security holders of such trust assume no personal
liability for obligations entered into on behalf of such trust and the
respective property shall not be subject to the claims of any person relating to
any such obligations.
IN WITNESS WHEREOF, the parties have duly executed this
Agreement as of the date first above written.
The Company:
HOTEL INVESTORS TRUST
By: _____________________________________
Senior Vice President and Trustee
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The Executive:
_________________________________________
Xxxxxxx X. Xxxxx
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