Exhibit 10.2

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT made and entered into as of the 31st day of January, 1998, by and
between REALTY ReFUND TRUST, an unincorporated association in the form of a
business trust organized under the laws of the State of Ohio having its
principal business address at 1750 Huntington Building, 925 Euclid Avenue,
Cleveland, Ohio 44114 (the “Trust”), and JAMES F. WIRTH, c/o InnSuites Hotels
LLC, 1615 East Northern Avenue, Suite 105, Phoenix, Arizona 85020-3998
(“Employee”).

 

RECITALS:

 

The Trust has been engaged since 1971 in the business of refinancing existing
income-producing commercial, industrial and multi-unit residential real property
by supplementing or replacing existing financing and is currently redirecting
its business to developing and owning lodging properties.  The Trust is party to
an Advisory Agreement, dated as of June 15, 1971, as the same has been extended
and amended (the “Advisory Agreement”), with Mid-America ReaFund Advisors, Inc.
(The “Adviser”), assignee of ReaFund Advisors, Inc.  Under the terms of the
Advisory Agreement, the Adviser has agreed to furnish advice and recommendations
in respect of all aspects of the business and affairs of the Trust and to
furnish day-to-day administration for the Trust.

 

The Employee is Chairman, President and Director of the Adviser.  He has,
effective on the date hereof, also been elected Chairman and President of the
Trust.  The Trustees determined that it was desirable to provide for continuity
and to assure the Trust that the services presently being furnished to it by the
Adviser would be furnished by the Employee without any cost or expense to the
Trust in excess of that called for under the terms of the Advisory Agreement in
the event of any termination of the Advisory Agreement.

 

AGREEMENTS:

 

NOW, THEREFORE, in consideration of the foregoing, and their mutual covenants
and agreements herein contained, the parties hereto do hereby agree as follows:

 

1.                                       Employment

 

The Trust hereby employs Employee as the Chairman, Chief Executive Officer and
President of the Trust, and Employee hereby accepts such employment upon the
terms and conditions hereinafter set forth.

 

2.                                       Term

 

Subject to the provisions for earlier termination as hereinafter provided, this
Agreement shall commence upon the execution hereof and shall continue through
and including the 31st day of December, 2007.

 

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3.                                       Duties

 

(A)                              Employee shall devote such business time,
attention and energies to the business of the Trust as he shall deem necessary
to perform for the Trust all of the duties and services required of him
hereunder and shall serve both diligently and to the best of his ability. 
Employee further shall perform such other duties as he shall deem to be normally
incident to the positions of Chairman, Chief Executive Officer and President of
the Trust.  In addition to his duties as Chairman, Chief Executive Officer and
President, Employee shall perform or provide for the performance of all of the
duties and services set forth in Section 1 of the Advisory Agreement; provided,
however, that so long as the Advisory Agreement shall remain in full force and
effect, the Advisor shall perform the Advisory duties thereunder.

 

(B)                                If the Trustees of the Trust request the
Employee to engage in other activities which complement the Trust’s investments,
Employee may receive compensation or commissions therefor from the Trust or such
other persons.

 

4.                                       Compensation

 

During the term of this Agreement, so long as the Adviser is performing its
services and duties under the terms of the Advisory Agreement and being paid
compensation in respect thereof, the Trust shall not pay to the Employee any
monetary consideration. In the event that at any time during the term hereof the
Adviser shall cease to serve the Trust as its Adviser under the terms of the
Advisory Agreement and to receive compensation therefor (regardless of the
reason for such cessation), then and thereafter during the remaining term of
this Agreement the Employee shall receive as compensation in full for all of his
services hereunder an amount equal to one hundred percent (100%) of the Regular
Compensation and the Incentive Compensation that would have been paid to the
Adviser in respect of such period pursuant to Sections 9, 10 and
11(a) of the Advisory Agreement; and bear all expenses and pay all costs and
charges of the kind or nature that would have been paid or borne by the Adviser
prior to the termination of the Advisory Agreement.

 

In the event of cessation of the Advisory Agreement, the Employee’s compensation
shall be subject to adjustment by the Trust in accordance with, and upon
completion of, the annual audit of the Trust’s financial statements, and subject
to the same limitations on the compensation of Adviser as contained in
Section 15 of the Advisory Agreement.

 

Employee shall, in addition to the foregoing, participate in any employee
benefit programs established by the Trust, including, but not limited to, health
and accident insurance, group life insurance, stock option plans, pension plans
and profit sharing plans.

 

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5.                                       Termination

 

At the option of the Trust, this Agreement may be terminated immediately upon
written notice of termination from the Trust to Employee if any of the following
events shall occur:

 

(i)                                     If Employee materially shall violate any
provision of this Agreement and, after written notice of such violation, shall
not cure such default within thirty (30) days (provided, however, that if
Employee shall not be reasonably able to cure such default within such thirty
(30) day period, if Employee shall not have commenced promptly to cure such
default and diligently pursued the same to completion); or

 

(ii)                                  If Employee shall die; or

 

(iii)                               If Employee shall become disabled for a
period of twelve (12) consecutive months.  As used herein, “disabled” shall mean
such physical or mental impairment of Employee as shall result in his being
unable to perform his full duties hereunder; or

 

(iv)                              If Employee shall so consent.

 

6.                                       Covenant Against Competition

 

(A)                              During the period commencing with the date
hereof and continuing until the latter of the expiration of the term of this
Agreement or until December 31, 2008 if this Agreement shall be terminated for
the reasons specified in Section 5(A)(i) hereof, Employee agrees that, except as
an employee of the Adviser while the Adviser is serving as adviser to the Trust
pursuant to the terms of the Advisory Agreement, Employee shall not, without the
prior approval of the Trustees, directly or indirectly:

 

(i)                                     Act as the investment advisor for any
other person or entity (“person”) or enter into an investment advisory contract
therewith or contract to perform other services with any other real estate
investment trust or other person the investment policy of which is substantially
similar to that of the Trust at that time.  However, Employee may act as an
investment advisor and perform other services for persons other than the Trust
in situations in which such persons are participating in investments with the
Trust or which have investment policies substantially dissimilar to that of the
Trust.

 

(ii)                                  Either as an individual for Employee’s own
account or as an investor, or other participant in, or as an employee, agent or
representative of, any other business enterprise:

 

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(a)                                  solicit, divert, entice, take away or
interfere with, or attempt to solicit, divert, entice or take away or interfere
with, any of the Trust’s business, patronage, borrowers or investment
opportunities except as permitted pursuant to Subparagraph (i) hereof; or

 

(b)                                 engage or participate in or finance, aid or
be connected with, any commercial enterprise which competes with any of the
business activities which the Trust is conducting at such time.

 

The foregoing, however, shall not be deemed to prohibit the investment without a
role in management by Employee in the equity or debt securities of any company
otherwise within the ambit of this covenant and registered with the Securities
and Exchange Commission pursuant to Section 12 of the Securities and Exchange
Act of 1934.

 

(B)                                If it shall be judicially determined that
Employee has violated any of the covenants or agreements to be performed and/or
observed by Employee pursuant to the provisions of this Section 6, then the
period applicable to such of said covenants or agreements as shall have been so
determined to have been violated by Employee shall automatically be extended by
that period of time which shall be co-extensive with the period during which
said violations have occurred.

 

(C)                                Subject only to the rules and procedures set
forth in the Second Amended and Restated Declaration of Trust, Employee can
continue to engage in all facets of the real estate business and business
affairs generally.  Furthermore, subject to the foregoing, Employee, or any
entity in which he is an officer, director, shareholder, employee, partner
(general or limited) or otherwise interested, may borrow from the Trust or
purchase properties on which the Trust is a lender.

 

Employee acknowledges that the covenants contained in this Section 6 are of the
essence of this Agreement; said covenants shall be construed as independent of
any other provisions of this Agreement; and the existence of any claim or cause
of action by Employee against the Trust, whether predicated on this Agreement or
otherwise, shall not constitute a defense to the enforcement by the Trust of
these covenants.

 

Recognizing the irreparable nature of the injury that could result from
Employee’s violation of any of the covenants and agreements to be performed
and/or observed by Employee pursuant to the provisions of this Section 6, and
that damages would be inadequate compensation, it is agreed that any violation
by Employee of the provisions of this Section 6 shall be the proper subject for
immediate injunctive and other equitable relief to the Trust.  Employee further
agrees to communicate the contents of this Section 6 to any prospective employer
or associate of Employee which has an investment policy which is substantially
similar to that of the Trust.

 

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7.                                       Governing Law

 

The laws of the State of Arizona shall govern the validity, performance and
enforcement of this Agreement.  If any of the terms or provisions of this
Agreement or the application thereof to any person or circumstance shall, to any
extent, be invalid or unenforceable, the remainder of this Agreement or the
application of such term or provision to persons or circumstances other than
those to which it is held invalid or unenforceable shall not be affected
thereby, and each term and provision of this Agreement shall be valid and be
enforced to the fullest extent permitted by law.  If the invalidity or
unenforceablitiy of any covenant or restriction herein is due to the
unreasonableness of the time or the fact that no geographical area is specified
for the coverage of any said covenant or restriction, the said covenant or
restriction shall nevertheless be effective for such period of time and for such
geographical area as may be determined by a court of competent jurisdiction.

 

8.                                       Assignment

 

This Agreement shall not be assignable by the Trust without the written consent
of Employee.

 

9.                                       The Entire Agreement

 

The foregoing is the entire agreement of the parties hereto in respect of the
subject matter hereof, and no waiver, amendment or modification hereof shall be
valid unless in writing and signed by both parties.

 

10.                                 Counterparts

 

This Agreement may be executed in one or more counterparts, each of which shall
be deemed an original, but all of which taken together shall constitute one and
the same instrument.

 

11.                                 Notices

 

All notices hereunder shall be in writing and delivered or mailed by registered
or certified mail, return receipt requested, to the parties at the addresses
listed below or to such other address as the Trust or Employee may hereafter
designate in writing to the other.  A copy of any such notice shall also be
telecopied at the time of its mailing to the number listed below for the
relevant party.

 

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12.                                 The Trust

 

The name Realty ReFund Trust is the designation of the Trustees under a
Declaration of Trust dated April 28, 1971, as amended, and all persons dealing
with Realty ReFund Trust must look solely to the Trust property for the
enforcement of any claims against Realty ReFund Trust as neither the Trustees,
officers, agents nor security holders assume any personal liabilities for
covenants or obligations entered into on behalf of Realty ReFund Trust and their
respective properties shall not be subject to any claims of any other person in
respect of such liability.

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written, the Trust pursuant to the authorization of its
Trustees.

 

 

REALTY ReFUND TRUST

 

 

 

 

 

By:

 /s/ Gregory D. Bruhn

 

 

Gregory D. Bruhn

 

Executive Vice President

 

1750 Huntington Building

 

925 Euclid Avenue

 

Cleveland, Ohio 44114

 

Phone: (216) 622-0046

 

Fax: (216) 622-1477

 

 

 

THE TRUST

 

 

 

 

 

/s/ James F. Wirth

 

 

James F. Wirth

 

1615 E. Northern Avenue

 

Suite 105

 

Phoenix, Arizona 85020

 

Phone: (602) 944-1500

 

Fax: (602) 678-0281

 

 

 

EMPLOYEE

 

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