EXHIBIT 10.4
EXECUTIVE EMPLOYMENT AGREEMENT
BETWEEN
LODGIAN, INC.
AND
DONNA COHEN
MARCH 29, 2007

 

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EMPLOYMENT AGREEMENT
THIS EMPLOYMENT AGREEMENT (the “Agreement”) by and between Lodgian, Inc. (the
“Company”), and Donna Cohen (“You” or “Your”)(collectively, the “Parties”), is
entered into and effective as of the 29th day of March, 2007 (the “Effective
Date”). 1
     WHEREAS, You are currently employed as Vice President and Corporate
Controller of the Company;
     WHEREAS, the Company desires that You continue to serve as Vice President
and Corporate Controller of the Company, and You desire to continue said
employment;
     WHEREAS, Your position is a position of trust and responsibility with
access to Confidential Information, Trade Secrets, and information concerning
employees and customers of the Company;
     WHEREAS, the Trade Secrets and Confidential Information, and the
relationship between the Company and each of its employees and customers are
valuable assets of the Company and may not be used for any purpose other than
the Company’s Business;
     WHEREAS, the Company has agreed to continue to employ You in exchange for
Your compliance with the terms of this Agreement; and
     WHEREAS, the Company and You desire to express the terms and conditions of
Your continued employment in this Agreement.
     NOW, THEREFORE, the Parties agree:
1. Employment and Duties
    (a) Position. The Company shall employ You as Vice President and Corporate
Controller.
    (b) Duties. You agree to perform all duties that are consistent with Your
position and that may otherwise be assigned to You by the Company from time to
time.
    (c) Reporting. You shall report directly to the Chief Financial Officer of
the Company or any other executive designated by the Chief Financial Officer
from time to time.
    (d) Devotion of Time. You agree to (i) devote all necessary working time
required of Your position, (ii) devote Your best efforts, skill, and energies to
promote and advance the business and/or interests of the Company, and
(iii) fully perform Your obligations under this Agreement. During Your
employment, You shall not render services to any other entity,
 

1   Unless otherwise indicated, all capitalized terms used in this Agreement are
defined in the “Definitions” section attached as Exhibit A. Exhibit A is
incorporated by reference and is included in the definition of “Agreement.”

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regardless of whether You receive compensation, if such services shall impede
Your ability to perform Your duties for the Company. You may, however,
(A) engage in community, charitable, and educational activities, (B) manage Your
personal investments, and (C) with the prior written consent of the Company,
serve on corporate boards or committees, provided that such activities do not
conflict or interfere with the performance of Your obligations under this
Agreement or conflict with the interests of the Company.
     (e) Company Policies. You agree to comply with the policies and procedures
of the Company as may be adopted and changed from time to time, including those
described in the Company’s employee handbook. If this Agreement conflicts with
such policies or procedures, this Agreement will control.
2. Term. This Agreement is for an indefinite term. This Agreement may only be
terminated pursuant to Section 4 below. The period during which You are employed
by the Company shall be referred to as the Employment Period.
3. Compensation.
     (a) Base Salary. During the Employment Period, the Company will pay You an
annual minimum base salary (“Base Salary”) of One Hundred Seventy Five Thousand
Dollars ($175,000.00), minus applicable withholdings, in accordance with the
Company’s normal payroll practices. Your Base Salary may be increased at the
Company’s discretion based upon Your performance and the Company’s performance.
Your Base Salary will be reviewed on an annual basis.
     (b) Incentive Compensation. During the Employment Period, You will be a
participant eligible to receive additional incentive compensation if Your
performance and the Company’s performance meet certain criteria established as
part of the Lodgian, Inc. Executive Incentive Plan (the “Incentive Plan”) and as
amended from time to time by the Company’s Compensation Committee. The Incentive
Plan is incorporated by reference. Compensation provided to You pursuant to the
Incentive Plan will be paid pursuant to the terms of the Incentive Plan, and
will be subject to all applicable withholdings. Notwithstanding any provision to
the contrary set forth in the Incentive Plan, upon termination of Your
employment, Your entitlement to any compensation pursuant to the Incentive Plan
will be governed by Section 5 or Section 6 below.
     (c) Benefits Plans. During the Employment Period, You will be eligible to
participate in all benefit plans in effect for executives and employees of the
Company, subject to the terms and conditions of such plans.
     (d) Vacation. During the Employment Period, You are entitled to four
(4) weeks paid vacation each year. In addition, You shall be entitled to
personal and/or sick days in accordance with the Company policies.
4. Termination. This Agreement may be terminated at any time by any of the
following events:
     (a) Mutual written agreement between You and the Company at any time;

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     (b) Your death;
     (c) Your disability which renders You unable to perform the essential
functions of Your job even with reasonable accommodation, as determined by the
Company in its sole discretion;
     (d) For Cause. For Cause shall mean a termination by the Company because of
any one of the following events:
     (i) Your willful refusal to follow the lawful direction of the CEO and/or
the person to whom You report or Your material failure to perform Your duties
(other than by reason of disability, as defined in Section 4(c) above), in
either case, only after You have been given written notice by the CEO and/or the
person to whom You report detailing the directives You have refused to follow or
the duties You have failed to perform and been given at least 30 days to cure;
     (ii) Your material and willful failure to comply with Company policies as
applied to Company employees, only after You have been given written notice by
the CEO and/or the person to whom You report detailing the policies with which
You have failed to comply and been given at least 30 days to cure;
     (iii) Your engaging in any of the following conduct:
          (1) an act of fraud or dishonesty that materially harms the Company or
its affiliates,
          (2) a felony or any violation of any federal or state securities law
or Your being enjoined from violating any federal or state securities law or
being determined to have violated any such law;
          (3) gross negligence in connection with any property or activity of
the Company and its subsidiaries and affiliates, and successors;
          (4) repeated and intemperate use of alcohol or illegal drugs after
written notice from the CEO and/or the person to whom You report;
          (5) material breach of any of Your obligations under this Agreement
(other than by reason of physical or mental illness, injury, or condition), but
only after You have been given written notice of the breach by the CEO and/or
the person to whom You report and been given at least thirty (30) days to cure;
          (6) becoming barred or prohibited by the SEC from holding Your
position with the Company; or
     (iv) Your resignation for other than Good Reason.
     (e) Your resignation for Good Reason; or

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     (f) Without Cause. Without Cause shall mean any termination of Your
employment by the Company which is not defined in sub-sections (a)-(e) above.
5. Company’s Post-Termination Obligations.
     (a) If this Agreement terminates for the reasons set forth in Sections 4(a)
or 4(d) above, and Section 6 below does not apply, then the Company will pay You
all accrued but unpaid Base Salary through the termination date. The Company
shall have no other obligations to You, including under this Agreement, the
Incentive Plan, any Company policy, or otherwise; however, You shall continue to
be bound by Section 8 and all other post-termination obligations to which You
are subject, including, but not limited to, the obligations contained in this
Agreement. You shall not be entitled to any accelerated vesting or lapse of
vesting restrictions with respect to any award(s) granted pursuant to the 2002
Lodgian, Inc. Stock Incentive Plan or any other similar plan.
     (b) If this Agreement terminates for any reason set forth in Sections 4(b),
4(c), 4(e), or 4(f) above, and Section 6 below does not apply, then the Company
will pay You all accrued but unpaid Base Salary through the termination date. In
addition, upon Your “separation from service” (within the meaning of Internal
Revenue Code (“Code”) § 409A(a)(2)(A)(i)), the Company shall: (i) pay You (or
Your estate if applicable), within thirty (30) days of Your termination date, a
lump sum payment equal to fifty percent (50%) of Your then current annual Base
Salary; (ii) reimburse Your and Your eligible dependents’ COBRA premiums under
the Company’s major medical group health plan on a monthly basis for a period of
six (6) months; (iii) pay You (or Your estate if applicable), within thirty
(30) days of Your termination date, a lump sum payment of Twenty Five Thousand
One Dollars ($25,001.00); and (iv) notwithstanding anything to the contrary in
any applicable documents evidencing a grant of an award under the Lodgian, Inc.
2002 Stock Incentive Plan or any similar plan, accelerate the vesting of any
such awards granted to You by the Company (the “Award(s)”) so that any such
Award(s) comprised of options to purchase Company stock shall be immediately
exercisable in full, and so that all vesting restrictions upon any such Award(s)
comprised of restricted stock shall lapse (collectively, the payments and
benefits set forth in the preceding sub-clauses (i) — (iv) to be referred to as
the “Separation Benefits”). The Company shall have no other obligations to You,
including under this Agreement, the Incentive Plan, any Company policy, or
otherwise. The Separation Benefits shall constitute full satisfaction of the
Company’s obligations under this Agreement. The Company’s obligation to provide
the Separation Benefits shall be subject to Section 7 below, and conditioned
upon Your satisfaction of the following conditions (the “Separation Benefits
Conditions”):
     (i) Execution and non-revocation of a Separation & Release Agreement in a
form prepared by the Company, which includes, but is not limited to, Your
releasing the Company from any and all liability and claims of any kind; and
     (ii) Your compliance with the restrictive covenants (Section 8(d)) and all
of Your post-termination obligations, including, but not limited, the
obligations contained in this Agreement.

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     If You do not execute an effective Separation & Release Agreement as set
forth above, the Company will not be obligated to provide any Separation
Benefits to You under this Section 5(b). The Company’s obligation to provide the
Separation Benefits set forth in this Section 5(b) shall terminate immediately
upon any breach by You of any post-termination obligations to which You are
subject.
6. Change in Control.
     (a) Change In Control Separation Benefits. If, within sixty (60) days
before or three hundred sixty five (365) days after a Change in Control, this
Agreement terminates for the reasons set forth in Sections 4(e), or 4(f), then
the Company will pay You all accrued but unpaid Base Salary through the
termination date. In addition, upon Your “separation from service” (within the
meaning of Code § 409A(a)(2)(A)(i)), the Company shall: (i) pay You a lump sum
payment equal to Your then current annual Base Salary, to be paid within thirty
(30) days after the date of termination; (ii) pay You a lump sum payment of
Fifty Thousand Two Dollars ($50,002.00), to be paid within thirty (30) days
after the date of termination; (iii) reimburse Your and Your eligible
dependents’ COBRA premiums under the Company’s major medical group health plan
on a monthly basis for a period of twelve (12) months; and (iv) notwithstanding
anything to the contrary in any applicable documents evidencing a grant of an
award under the Lodgian, Inc. 2002 Stock Incentive Plan or any similar plan,
accelerate the vesting of any such awards granted to You by the Company (the
“Award(s)”) so that any such Award(s) comprised of options to purchase Company
stock shall be immediately exercisable in full, or so that all vesting
restrictions upon any such Award(s) comprised of restricted stock shall lapse
(collectively, the payments and benefits set forth in the preceding sub-clauses
(i) — (iv) to be referred to as the “Change In Control Separation Benefits”).
Your right to receive the Change In Control Separation Benefits shall be subject
to Section 7 below and the Separation Benefits Conditions set forth in Section
5(b) above. The Change In Control Separation Benefits to be provided under this
Section 6 shall constitute full satisfaction of the Company’s obligations under
this Agreement, the Incentive Plan, any Company policy, or otherwise.
     (b) Change In Control Completion Bonus. In the event of the closing of any
transaction constituting a Change In Control, provided (1) such closing occurs
on or before December 31, 2008, and (2) You are employed within sixty (60) days
before or on the date of such closing, then the Company shall (i) pay You a lump
sum payment equal to twenty-five percent (25%) of Your then current annual Base
Salary; (ii) pay You a lump sum payment of Twelve Thousand Five Hundred Dollars
and Fifty Cents ($12,500.50), and (ii) grant You Twenty Two Thousand (22,000)
restricted shares of Common Stock subject to the terms and conditions of the
Employee Restricted Stock Agreement attached as Exhibit B (sub-sections
(i) through (iii) collectively, the “Completion Bonus”). Notwithstanding
anything to the contrary set forth in the Incentive Plan or this Agreement, the
Completion Bonus, if any, shall fully satisfy the Company’s payment obligations
under the Incentive Plan for the calendar year in which the closing occurs. The
Company shall pay You the Completion Bonus within thirty (30) days following the
closing of the Change In Control; provided, however, the Company’s obligation to
provide the Completion Bonus shall be subject to Section 7 below and conditioned
upon Your execution and non-revocation of a Release Agreement in a form prepared
by the Company, which includes, but is not limited to, Your releasing the
Company from any and all liability and claims of any kind.

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7. Delay In Payments To Comply With Code § 409A. Notwithstanding any provision
of this Agreement to the contrary, if You are a “specified employee” within the
meaning of Code §409A(a)(2)(B)(i), then any payment that is required to be made
under Section 5 or Section 6 above within the first six (6) months following
Your “separation from service” (within the meaning of Code § 409A(a)(2)(A)(i))
shall be paid on the date that is the first business day of the seventh (7th)
month after the date of Your “separation from service” and shall be paid in a
single lump sum payment, provided that You satisfy the Separation Benefits
Conditions. The provisions of this Section are intended to require a delay in a
payment under Section 5 or Section 6 above only to the extent that such a delay
is required in order for such payment to comply with Code § 409A(a)(2)(B)(i),
and shall not otherwise apply. In addition, immediately prior to Your
“separation from service” (within the meaning of Code §409A(a)(2)(A)(i), the
Company shall (i) establish an irrevocable grantor trust (the “Trust”) that
shall have terms designed to be consistent with those allowed under the model
trust set forth in IRS Revenue Procedure 92-64 and that shall have an
independent financial institution as trustee, (ii) contribute to the Trust the
amount of each payment delayed for six (6) months under this Section as of the
date such payment would otherwise be required to be paid absent the provisions
of this Section applying to delay such payment, and (iii) provide the trustee of
the Trust with a written direction to (A) hold said amount in a segregated
account for Your benefit and (B) pay from such segregated account all payments
delayed under this Section (with earnings thereon) to You on the first business
day of the seventh (7th) month after the date of Your “separation from service.”
Trust assets shall be invested in the highest-yielding available money market
account of the trustee (or, if the trustee does not have such an account, then
the highest-yielding available money market account of Bank of America), and
earnings on amounts contributed to the Trust for purposes of the preceding
sentence shall be determined based on such chosen investment. All expenses of
the trustee shall be paid by the Company and not from the Trust’s assets. The
provisions of this Section shall not be required if You so agree in writing.
Upon the trustee’s final payment of the entire corpus of the Trust in a single
lump sum, the Trust shall terminate.
8. Your Post-Termination Obligations.
     (a) Return of Materials. Upon the termination of Your employment for any
reason or upon the Company’s request at any time, You will return to the Company
all of the Company’s property, including, but not limited to, computers,
computer equipment, office equipment, mobile phones, personal digital assistants
(PDAs), keys, passcards, calling cards, credit cards, confidential or
proprietary lists (including, but not limited to, customer, supplier, licensor,
and client lists), rolodexes, tapes, software, computer files, marketing and
sales materials, and any other property, record, document or piece of equipment
belonging to the Company. You will not (i) retain any copies of the Company’s
property, including any copies existing in electronic form, which are in Your
possession, custody, or control, or (ii) destroy, delete, or alter any Company
property, including, but not limited to, any files stored electronically without
the Company’s prior written consent. The obligations contained in this Section
also apply to any property which belongs to a third party, including, but not
limited to, (i) any entity which is affiliated or related to the Company, or
(ii) the Company’s customers, licensors, or suppliers.
     (b) Set-Off. If You have any outstanding obligations to the Company upon
the termination of Your employment for any reason, You hereby authorize the
Company to deduct

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any amounts owed to the Company from Your final paycheck and/or any amounts that
would otherwise be due to You, including, but not limited to, under Section 5 or
Section 6 above.
     (c) Non-Disparagement. During Your employment and upon the termination of
Your employment with the Company for any reason, You will not make any
disparaging or defamatory statements, whether written or oral, regarding the
Company.
     (d) Restrictive Covenants. You acknowledge that the restrictions contained
in this Section 8(d) are reasonable and necessary to protect the legitimate
business interests of the Company, and will not impair or infringe upon Your
right to work or earn a living after Your employment with the Company ends.
     (i) Trade Secrets and Confidential Information. You represent and warrant
that: (i) You are not subject to any legal or contractual duty or agreement that
would prevent or prohibit You from performing the duties contemplated by this
Agreement or otherwise complying with this Agreement, and
     (ii) You are not in breach of any legal or contractual duty or agreement,
including any agreement concerning trade secrets or confidential information
owned by any other party.
     You agree that You will not: (i) use, disclose, or reverse engineer the
Trade Secrets or the Confidential Information for any purpose other than the
Company’s Business, except as authorized in writing by the Company; (ii) during
Your employment with the Company, use, disclose, or reverse engineer (a) any
confidential information or trade secrets of any former employer or third party,
or (b) any works of authorship developed in whole or in part by You during any
former employment or for any other party, unless authorized in writing by the
former employer or third party; or (iii) upon Your resignation or termination
(a) retain Trade Secrets or Confidential Information, including any copies
existing in any form (including electronic form), which are in Your possession
or control, or (b) destroy, delete, or alter the Trade Secrets or Confidential
Information without the Company’s written consent.
     The obligations under this sub-section shall: (i) with regard to the Trade
Secrets, remain in effect as long as the information constitutes a trade secret
under applicable law, and (ii) with regard to the Confidential Information,
remain in effect during the Restricted Period. The confidentiality, property,
and proprietary rights protections available in this Agreement are in addition
to, and not exclusive of, any and all other rights to which the Company is
entitled under federal and state law, including, but not limited to, rights
provided under copyright laws, trade secret and confidential information laws,
and laws concerning fiduciary duties.
     (ii) Non-Solicitation of Customers. During the Restricted Period, You shall
not, directly or indirectly, solicit any Customer of the Company for the purpose
of selling or providing any products or services competitive with the Business.
The restrictions set forth in this sub-section apply only to Customers with whom
You had Contact during the term of Your employment. Nothing in this sub-section
shall be construed to prohibit You from soliciting any Customer of the Company
for the purpose of selling or providing any products or services competitive
with the Business: (i) which You never sold or provided

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while employed by the Company; (ii) to a Customer that explicitly severed its
business relationship with the Company unless You, directly or indirectly,
caused or encouraged the Customer to sever the relationship; or (iii) which
products or services the Company no longer offers.
     (iii) Non-Solicitation of Prospective Customers. During the Restricted
Period, You shall not, directly or indirectly, solicit any Prospective Customer
of the Company for the purpose of selling or providing any products or services
competitive with the Business. The restrictions set forth in this sub-section
apply only to Prospective Customers with whom You had Contact during the last
year of Your employment with the Company (or during Your employment if employed
less than a year). Nothing in this sub-section shall be construed to prohibit
You from soliciting any Prospective Customer of the Company for the purpose of
selling or providing any products or services competitive with the Business
which the Company no longer offers.
     (iv) Non-Recruit of Employees. During the Restricted Period, You shall not,
directly or indirectly, solicit, recruit, or induce any Employee to
(i) terminate his or her employment relationship with the Company, or (ii) work
for any other person or entity engaged in the Business. The restrictions set
forth in this sub-section shall apply only to Employees (a) with whom You had
Material Interaction, or (b) You, directly or indirectly, supervised.
     (v) Non-Disclosure of Customer or Prospective Customer Information. During
the Restricted Period, You shall not, except as authorized by the Company,
divulge or make accessible to any person or entity (i) the names of Customers or
Prospective Customers, or (ii) any information contained in a Customer’s or
Prospective Customer’s account.
     (e) Post-Employment Disclosure. During the Restricted Period, You shall
provide a copy of this Agreement to persons and/or entities for whom You work or
consult as an owner, partner, joint venturer, employee or independent
contractor.
9. Injunctive Relief. You agree that if You breach any portion of Section 8 of
this Agreement: (i) the Company would suffer irreparable harm; (ii) it would be
difficult to determine damages, and money damages alone would be an inadequate
remedy for the injuries suffered by the Company, and (iii) if the Company seeks
injunctive relief to enforce this Agreement, You will waive and will not
(a) assert any defense that the Company has an adequate remedy at law with
respect to the breach, (b) require that the Company submit proof of the economic
value of any Trade Secret or Confidential Information, or (c) require the
Company to post a bond or any other security. Nothing contained in this
Agreement shall limit the Company’s right to any other remedies at law or in
equity.
10. Independent Enforcement. The covenants set forth in Section 8 of this
Agreement shall be construed as agreements independent of (i) any other
agreements, or (ii) any other provision in this Agreement, and the existence of
any claim or cause of action by You against the Company, whether predicated on
this Agreement or otherwise, regardless of who was at fault and regardless of
any claims that either You or the Company may have against the other, shall

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not constitute a defense to the enforcement by the Company of the covenants set
forth in Section 8 of this Agreement. The Company shall not be barred from
enforcing the restrictive covenants set forth in Section 8 of this Agreement by
reason of any breach of (i) any other part of this Agreement, or (ii) any other
agreement with You.
11. Release You release and discharge the Company from any claim or liability,
whether known or unknown, arising out of any event, act or omission occurring on
or before the day You sign this Agreement, including, but not limited to, claims
arising out of Your employment, claims arising by virtue of Your status as a
shareholder of Company, claims for breach of contract, tort, negligent hiring,
negligent training, negligent supervision, negligent retention, employment
discrimination, retaliation, or harassment, claims arising out of or relating to
equity or other ownership interest in Company, as well as any other statutory or
common law claims, at law or in equity, recognized under any federal, state, or
local law. You also release any claims for unpaid back pay, sick pay, vacation
pay, expenses, bonuses, commissions, attorneys’ fees, or any other compensation.
12. Severability. The provisions of this Agreement are severable. If any
provision is determined to be invalid, illegal, or unenforceable, in whole or in
part, the remaining provisions and any partially enforceable provisions shall
remain in full force and effect.
13. Attorneys’ Fees. In the event of litigation relating to this Agreement, the
prevailing party shall be entitled to recover attorneys’ fees and costs of
litigation in addition to all other remedies available at law or in equity.
14. Waiver. The Company’s failure to enforce any provision of this Agreement
shall not act as a waiver of that or any other provision. The Company’s waiver
of any breach of this Agreement shall not act as a waiver of any other breach.
15. Entire Agreement. This Agreement, including Exhibits A, B, and the Incentive
Plan which are incorporated by reference, constitutes the entire agreement
between the Parties concerning the subject matter of this Agreement. This
Agreement supersedes any prior communications, agreements or understandings,
whether oral or written, between the Parties relating to the subject matter of
this Agreement. Other than terms of this Agreement, no other representation,
promise or agreement has been made with You to cause You to sign this Agreement.
16. Amendments. As a condition of employment and a material term under this
Agreement, You agree that, at any time during Your employment, You shall sign an
amendment to this Agreement which would modify the Restrictive Covenants in
Section 8 of this Agreement (the “Amendment”) based on changes to Your duties or
changes in the law regarding restrictive covenants. You agree that You shall not
be entitled to any additional consideration to execute the Amendment. You agree
that Your refusal to sign any such Amendment shall constitute a material breach
of this Agreement. This Agreement may not otherwise be amended or modified
except in writing signed by both Parties.
17. Successors and Assigns. This Agreement shall be assignable to, and shall
inure to the benefit of, the Company’s successors and assigns, including,
without limitation, successors

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through merger, name change, consolidation, or sale of a majority of the
Company’s stock or assets, and shall be binding upon You. You shall not have the
right to assign Your rights or obligations under this Agreement. The covenants
contained in Section 8 of this Agreement shall survive cessation of Your
employment with the Company, regardless of who causes the cessation or the
reason for cessation.
18. Governing Law. Except as set forth in Section 22 below, the laws of the
State of Georgia shall govern this Agreement. If Georgia’s conflict of law rules
would apply another state’s laws, the Parties agree that Georgia law shall still
govern.
19. No Strict Construction. If there is a dispute about the language of this
Agreement, the fact that one Party drafted the Agreement shall not be used in
its interpretation.
20. Notice. Whenever any notice is required, it shall be given in writing
addressed as follows:

             
 
  To Company:   Lodgian, Inc.    
 
      3445 Peachtree Rd., Suite 700    
 
      Atlanta, Georgia 30326    
 
      Attention: General Counsel    
 
           
 
  To Executive:   Donna Cohen    
 
      1301 Kirkwood Lane    
 
      Smyrna, GA 30082    

     Notice shall be deemed given and effective three (3) days after the deposit
in the U.S. mail of a writing addressed as above and sent first class mail,
certified, return receipt requested, or when actually received. Either Party may
change the address to which notices shall be delivered or mailed by notifying
the other party of such change in accordance with this Section.
21. Consent to Jurisdiction and Venue. Except as set forth in Section 22 below,
You agree that any claim arising out of or relating to this Agreement shall be
(i) brought in the Superior Court of Fulton County, Georgia, or (ii) brought in
or removed to the United States District Court for the Northern District of
Georgia, Atlanta Division. You consent to the personal jurisdiction of the
courts identified above. You waive (i) any objection to jurisdiction or venue,
or (ii) any defense claiming lack of jurisdiction or improper venue, in any
action brought in such courts.
22. Arbitration. Except as provided below in this Section, all disputes arising
out of Your employment or the cessation of Your employment, including, but not
limited to, claims arising under or relating to this Agreement, claims for
breach of contract, tort, employment discrimination, retaliation, or harassment,
as well as any other statutory or common law claims, at law or in equity,
recognized under any federal, state, or local law shall be exclusively resolved
by final and binding arbitration under the Federal Arbitration Act, 9 U.S.C. §
1. Such claims shall be settled by final and binding arbitration administered by
the American Arbitration Association in accordance with its National Rules for
the Resolution of Employment Disputes,

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and judgment on the award rendered by the arbitrator may be entered in any court
having jurisdiction thereof. The Company will pay all filing fees and arbitrator
costs associated with such arbitration.
     This arbitration provision shall not apply to any disputes or claims
relating to or arising out of unemployment, workers compensation, and/or the
restrictive covenants set forth in Section 8 of this Agreement, including, but
not limited to, any claims for equitable relief relating to such restrictive
covenants. Any claims relating to or arising out of Section 8 of this Agreement
shall be governed by Sections 18 and 21 above.

                 
 
  Acknowledged and agreed:   EJR
 
Lodgian, Inc.   DC
 
Employee    

23. AFFIRMATION. YOU ACKNOWLEDGE THAT YOU HAVE CAREFULLY READ THIS AGREEMENT,
YOU KNOW AND UNDERSTAND ITS TERMS AND CONDITIONS, AND YOU HAVE HAD THE
OPPORTUNITY TO ASK THE COMPANY ANY QUESTIONS YOU MAY HAVE HAD PRIOR TO SIGNING
THIS AGREEMENT.
In Witness Whereof, the Parties hereto have executed this Agreement as of the
Effective Date.

                  LODGIAN, INC.   DONNA COHEN    
 
               
By:
  /s/ Edward J. Rohling       /s/ Donna Cohen    
 
 
 
       
 
   
 
               
Its:
  President & CEO       Date: March 29, 2007    
 
 
 
             
 
               
Date:
  March 29, 2007            
 
 
 
             

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EXHIBIT A
DEFINITIONS

A.   “Affiliate” and “Associate” shall have the respective meanings ascribed to
such terms in Rule 12b-2 promulgated under the Securities Exchange Act of 1934,
as amended.

B.   “Beneficial Owner” shall have the meaning ascribed to that term in
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended.

C.   “Business” shall mean the business of owning and operating hotels
including, but not limited to, full-service hotels which have food and beverage
operations and meeting spaces.

D.   “Change in Control” means the first of the following to occur after the
date of this Agreement:

     (i) when any Person (other than the Company, any Subsidiary of the Company,
any employee benefit plan of the Company or of any Subsidiary of the Company, or
any person or entity organized, appointed or established by the Company or any
Subsidiary of the Company for or pursuant to the terms of any such plan), alone
or together with its Affiliates and Associates (collectively, an “Acquiring
Person”), shall become the Beneficial Owner of 40 percent or more of the then
outstanding shares of Common Stock or the Combined Voting Power of the Company;
     (ii) when, during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors of the Company
(the “Board”), and any new director (other than a director who is a
representative or nominee of an Acquiring Person) whose election by the Board or
nomination for election by the Company’s shareholders was approved by a vote of
at least a majority of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved (collectively, the “Continuing Directors”),
cease for any reason to constitute a majority of the Board;
     (iii) the consummation of a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or any Parent of such surviving
entity) at least a majority of the Combined Voting Power of the Company, such
surviving entity, or the Parent of such surviving entity outstanding immediately
after such merger or consolidation;
     (iv) the consummation of a plan of reorganization (other than a
reorganization under the United States Bankruptcy Code) or complete liquidation
of the Company or an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets, other than a sale of all or
substantially all of the Company’s assets to a transferee, the majority of whose
voting securities are held by the Company; or

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     (v) when the shareholders of the Company approve an agreement for the sale
or disposition by the Company of all or substantially all of the Company’s
assets in a transaction or series of transactions to an entity that is not
owned, directly or indirectly, by the Company’s common stock shareholders in
substantially the same proportions as the owners of the Company’s common stock
before such transaction or series of transactions.

E.   “Combined Voting Power” means the combined voting power of the Company’s or
other relevant entity’s then outstanding voting securities.

F.   “Common Stock ” means the Common Stock, par value $.01 per share, of the
Company.

G.   “Confidential Information” means (a) information of the Company, to the
extent not considered a Trade Secret under applicable law, that (i) relates to
the business of the Company, (ii) possesses an element of value to the Company,
(iii) is not generally known to the Company’s competitors, and (iv) would damage
the Company if disclosed, and (b) information of any third party provided to the
Company which the Company is obligated to treat as confidential, including, but
not limited to, information provided to the Company by its licensors, suppliers,
or customers. Confidential Information includes, but is not limited to,
(i) future business plans, (ii) the composition, description, schematic or
design of products, future products or equipment of the Company or any third
party, (iii) communication systems, audio systems, system designs and related
documentation, (iv) advertising or marketing plans, (v) information regarding
independent contractors, employees, clients, licensors, suppliers, customers, or
any third party, including, but not limited to, customer lists compiled by the
Company, and customer information compiled by the Company, and (vi) information
concerning the Company’s or a third party’s financial structure and methods and
procedures of operation. Confidential Information shall not include any
information that (i) is or becomes generally available to the public other than
as a result of an unauthorized disclosure, (ii) has been independently developed
and disclosed by others without violating this Agreement or the legal rights of
any party, or (iii) otherwise enters the public domain through lawful means.

H.   “Contact” means any interaction between You and a Customer or Prospective
Customer which takes place in an effort to establish, maintain, and/or further a
business relationship on behalf of the Company.

I.   “Customer” means any person or entity to whom the Company has sold its
products or services.

J.   “Employee” means any person who (i) is employed by the Company at the time
Your employment with the Company ends, or (ii) was employed by the Company
during the last year of Your employment with the Company (or during Your
employment if employed less than a year).

K.   “Good Reason” shall exist if (i) the Company, without Your written consent,
(A) takes any action which results in the material reduction of Your then
current duties or responsibilities, (B) reduces the benefits to which You are
entitled on the Effective Date, unless a similar reduction is made for other
executive employees, (C) commits a material breach of this

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    Agreement, or (D) requires You to relocate more than fifty (50) miles from
the location of the Company’s home office on the Effective Date; (ii) You
provide written notice to the Company of such action and provide the Company
with thirty (30) days to remedy such action (the “Cure Period”), (iii) the
Company fails to remedy such action within the Cure Period, and (iv) You resign
within ten (10) days of the expiration of the Cure Period. Good Reason shall not
include any isolated, insubstantial or inadvertent action that (i) is not taken
in bad faith, and (ii) is remedied by the Company within the Cure Period.

L.   “Material Interaction” means any interaction between You and an Employee
which relates or related, directly or indirectly, to the performance of Your
duties for the Company.

M.   “Parent” means any corporation which is a “parent corporation” within the
meaning of Section 424(e) of the Internal Revenue Code of 1986, as amended, with
respect to the relevant entity.

N.   “Person” means any person, entity or “group” within the meaning of
Section 13(d)(3) or Section 14(d)(2) of the Exchange Act.

O.   “Prospective Customer” means any person or entity to whom the Company has
solicited to sell its products or services.

P.   “Restricted Period” means the time period during Your employment with the
Company, and for two (2) years after Your employment with the Company ends.

Q.   “Subsidiary” means any corporation which is a “subsidiary corporation”
within the meaning of Section 424(f) of the Internal Revenue Code of 1986, as
amended, with respect to the Company.

R.   “Trade Secrets” means information of the Company, and its licensors,
suppliers, clients, and customers, without regard to form, including, but not
limited to, technical or nontechnical data, a formula, a pattern, a compilation,
a program, a device, a method, a technique, a drawing, a process, financial
data, financial plans, product plans, a list of actual customers, clients,
licensors, or suppliers, or a list of potential customers, clients, licensors,
or suppliers which is not commonly known by or available to the public and which
information (i) derives economic value, actual or potential, from not being
generally known to, and not being readily ascertainable by proper means by,
other persons who can obtain economic value from its disclosure or use, and
(ii) is the subject of efforts that are reasonable under the circumstances to
maintain its secrecy.

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EXHIBIT B
[Employee Restricted Stock Agreement]

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LODGIAN, INC.
EMPLOYEE RESTRICTED STOCK AGREEMENT

     
Name of Recipient:
  Award Date:
 
   
Number of Award Shares:
   

     THIS EMPLOYEE RESTRICTED STOCK AGREEMENT1 is made and entered into
effective as of the Award Date noted above by and between Lodgian, Inc., a
Delaware corporation and the Recipient noted above.
W I T N E S S E T H:
     WHEREAS, the Committee has authorized the grant to Recipient of a
restricted stock award under the Plan of shares of the Common Stock, and the
Company and Recipient wish to confirm herein the terms, conditions, and
restrictions of the restricted stock award;
     NOW, THEREFORE, in consideration of the premises, the mutual covenants
contained herein, and other good and valuable consideration, the parties hereto
agree as follows:
1     Award of Shares
     1.1 Award of Award Shares. Subject to the terms, restrictions, limitations,
and conditions stated herein and in the Plan, the Company hereby awards to
Recipient the number of Award Shares noted above, which shall be shares of the
common stock of the Company, subject to all terms and provisions of this
Agreement. By the execution of this Agreement, the Recipient hereby accepts the
Award Shares subject to all terms and provisions of this Agreement.
     1.2 Award Shares held by Custodian . The Recipient hereby authorizes and
directs the Company to deliver any share certificate issued by the Company to
evidence the Award Shares to the Custodian to be held by the Custodian until any
such Award Shares become Vested Award Shares. As Award Shares become Vested
Award Shares, and after satisfaction of any required withholding obligations in
accordance with Section 1.5 below, the Company shall cause appropriate
cancellation of share certificates held by the Custodian in the name of the
Recipient and the issuance of new share certificates representing the Vested
Award Shares and the delivery thereof directly to the Recipient. The Recipient
hereby irrevocably appoints the Custodian, and any successor thereto, as the
true and lawful attorney-in-fact of Recipient with full power and authority to
execute any stock transfer power or other instrument necessary to transfer the
Award Shares to the Company pursuant to this Agreement, in the name, place and
stead of Recipient. The term of such appointment shall commence on the Award
Date and shall continue until such Award Shares become Vested Award Shares and
the issuance of a new share certificate representing such shares directly to the
Recipient. During the period that the Custodian holds Award Shares, the
Recipient shall be entitled to all rights applicable to shares of common stock
of the Company which are so held; provided, however, in the event the number of
shares of common stock is increased or reduced by changing par value, split-up,
stock split, reverse stock split, reclassification, merger, reorganization,
consolidation, or otherwise, and in the event of any distribution of common
stock or other securities of the Company in respect of such Award Shares,
Recipient agrees that any certificate representing shares of common stock or
other securities of the Company issued as a result of any of the foregoing shall
be delivered to the Custodian and shall be subject to all of the provisions of
this Agreement as if initially subject hereto ab initio.
     1.3 Vesting of Award Shares. Except to the extent otherwise expressly
provided in any other written agreement between Recipient and the Company
executed before the Award Date of this Agreement providing more favorable terms
for the Recipient, Recipient shall become vested in the percentage of the
 

1   Unless otherwise indicated, all capitalized terms used in this Agreement are
defined in the “Definitions” section of Exhibit A. Exhibit A is incorporated by
reference and is included in the definition of “Agreement.”

 

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Award Shares shown below based upon the Continuous Service of the Recipient from
the Award Date of the Award Shares (as noted hereon):

      Vesting Schedule: Percentage Vested:   Continuous Service from Award Date:
0.0000%
  Less than 1 year
33.3333%
  At least 1 year, but less than 2 years
66.6666%
  At least 2 years, but less than 3 years
100.0000%
  At least 3 years

If the above calculation of vested Shares would result in a fraction, any
fraction will be rounded to zero. However, notwithstanding the foregoing, in the
event that the Recipient ceases Continuous Service with the Company (1) by
reason of death or Disability, (2) after having attained the age of sixty-five
(65), (3) because the Recipient’s employment with the Company has been
terminated by the Company without Cause, (4) because the Recipient has
terminated employment with the Company for Good Reason, or (5) because the
Recipient’s employment contract with the Company (if any) has come to an end and
has not been renewed or extended, then the Recipient shall nonetheless
immediately, as of the date of such cessation of Continuous Service, become
fully (100%) vested in the Award Shares. Furthermore, notwithstanding the
foregoing, in the event that a Change in Control of the Company occurs, then the
Recipient shall nonetheless immediately, as of the date of such Change in
Control, become fully (100%) vested in the Award Shares.
     1.4 Tax Consequences. Recipient represents that Recipient has been advised
by the Company to consult with, and has fully consulted with, Recipient’s own
tax consultants regarding his making a Code §83(b) Election with respect to the
Award Shares, and the resulting impact on Recipient’s personal tax situation,
prior to entering into this agreement and that Recipient is not relying on the
Company for any tax or investment advice. Recipient understands that Recipient
may suffer adverse tax consequences as a result of Recipient’s receipt and
disposition of the Shares. Recipient understands that Recipient may or may not
make a Code §83(b) Election with respect to the Award Shares, but that Recipient
shall be subject to the withholding provisions of Section 1.5 below based upon
the choice of Recipient regarding such Code §83(b) Election and the choice of
Recipient regarding the time and manner that withholding obligations shall be
satisfied.
     1.5 Withholding on Award Shares. Recipient hereby agrees that, in
consideration for the grant of the Award Shares, the following federal and state
income tax withholding provisions shall apply:
     (a) Code §83(b) Election Made by Recipient. If the Recipient makes a Code
§83(b) Election with respect to the Award Shares, then, in order not to forfeit
Award Shares, the Recipient must deliver to the Company a check payable to the
Company in the amount of all withholding or other tax obligations (whether
federal, state or local) imposed on the Company by reason of such Code §83(b)
Election simultaneously with the Recipient’s delivery to the Company of a copy
of his Code §83(b) Election (which must occur no later than thirty (30) days
after the Award Date). If the Recipient does not timely make such payment, the
Award Shares shall be immediately forfeited by the Participant, and any amounts
which must be paid by the Company for any required withholding or other tax
obligations imposed on the Company by reason of such Code §83(b) Election shall
be paid by the Recipient by directly withholding all such amounts as quickly as
possible consistent with applicable law from any other compensation payable to
the Recipient on or after the date of such Code §83(b) Election. The Recipient
hereby agrees to the withholding by the Company outlined in the preceding
sentence, and authorizes and directs that such withholding from the Recipient’s
compensation be made if such sentence is applicable.
     (b) Code §83(b) Election Not Made by Recipient. If the Recipient does not
make a Code §83(b) Election with respect to the Award Shares, then the Recipient
shall be entitled to elect one (or, at the discretion of the Committee, a
combination) of the following methods of satisfying the Company’s withholding
obligations:
     (1) Direct Payment on or prior to Substantial Vesting Event. The Recipient
may, on or before the date of occurrence of an event pursuant to which such
Award Shares become “substantially vested” within the meaning of Code §83,
deliver to the

 

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Company cash and/or a check payable to the Company in the amount of all
withholding or other tax obligations (whether federal, state or local) imposed
on the Company by reason of the substantial vesting of such Award Shares.
     (2) Return of Vested Award Shares upon Substantial Vesting Event. The
Recipient may, as of the close of business on the business day which is
coincident with or which immediately follows the occurrence of an event pursuant
to which such Award Shares become “substantially vested” within the meaning of
Code §83, allow the Company to repurchase from the Recipient the smallest whole
number of Vested Award Shares which, when multiplied by the fair market value of
the Common Stock on such business date, is sufficient to satisfy the amount of
the withholding tax obligations imposed on the Company by reason of the vesting
of the Award Shares. If the Recipient elects this method of satisfying
withholding obligations, the Recipient acknowledges and understands that any
Vested Award Shares repurchased from the Recipient may result in tax
consequences to the Recipient.
     (3) Incremental Withholding over Likely Vesting Period. The Recipient may,
beginning as of the Award Date, allow the Company to withhold from future
compensation payments to the Recipient substantially equal amounts such that the
aggregate of such amounts shall, as of the next likely date of occurrence of an
event pursuant to which any such Award Shares shall become “substantially
vested” within the meaning of Code §83, be sufficient to satisfy the amount of
the withholding tax obligations imposed on the Company by reason of the vesting
of the Award Shares. If the Recipient elects this method of satisfying
withholding obligations, the Recipient acknowledges and understands that:
     (i) The Company shall have complete discretion to determine how much and
when amounts shall be withheld;
     (ii) Amounts withheld may be immediately paid to the appropriate tax
authority as a prepayment of the withholding obligations, or may be held by the
Company until such time as the withholding obligations become due, in the sole
and complete discretion of the Company;
     (iii) No interest or earnings shall accrue based on such incremental
withholding; and
     (iv) In the event that the vesting of Award Shares should occur earlier
than forecasted in determining the substantially equal amounts to be withheld
from the Recipient’s future compensation payments, the Recipient may nonetheless
be required to deliver to the Company a check payable to the Company in the
amount of all withholding or other tax obligations (whether federal, state or
local) imposed on the Company by reason of the substantial vesting of such Award
Shares.
The Recipient’s election of a method of withholding under this Section 1.5 must
be made prior to the date of occurrence of an event pursuant to which such Award
Shares become “substantially vested” within the meaning of Code §83; provided,
however, (1) the Participant’s election of the method specified in
Section 1.5(b)(3) above must be made within thirty (30) days of the Award Date,
and (2) if the Recipient is required to file beneficial ownership reports
pursuant to Section 16(a) of the Securities Exchange Act of 1934, the
Participant’s election of the method specified in Section 1.5(b)(2) must be made
either (A) at least six months prior to the date of vesting of any of such Award
Shares, or (B) prior to the date of vesting of any of such Award Shares and in
any ten-day period beginning on the third day following the release of the
Company’s quarterly or annual summary statement of sales and earnings. The
Recipient’s election of a method of withholding under this Section 1.5 shall,
once made, be irrevocable. Notwithstanding the above, if, for any reason,
withholding or other tax obligations (whether federal, state or local) are
imposed upon the Company by reason of the grant of the Award Shares or their
becoming substantially vested, the Company shall have the power and the right to
deduct or withhold, or require the Recipient to remit to the Company as a
condition precedent to immediate forfeiture of the Award Shares, an amount
sufficient to satisfy such withholding or other tax obligations (whether
federal, state or local), and, in this regard, the Company may

 

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offer the Recipient various alternatives for satisfying such obligations. Upon
receipt of payment in full of all withholding tax obligations, the Company shall
cause a certificate representing the Award Shares which are the Vested Award
Shares to be issued and delivered to the Recipient.
     1.6 Rights as Stockholder. Recipient shall have no rights as a stockholder
with respect to any Award Shares until a stock certificate for the shares is
issued in Recipient’s name and held by the Custodian.
2     Restrictions on, & Forfeiture of, Unvested Award Shares
     2.1 Forfeiture upon Cessation of Services. Except to the extent otherwise
expressly provided in any other written agreement between Recipient and the
Company executed before the Award Date of this Agreement providing more
favorable terms for the Recipient, upon the Recipient’s cessation of the
performance of services for the Company for any reason, all Unvested Award
Shares shall be forfeited, effective upon the date of such cessation of the
performance of services.
     2.2 Restrictions on Unvested Award Shares. None of the Unvested Award
Shares may be conveyed, pledged, assigned, transferred, hypothecated,
encumbered, or otherwise disposed of by Recipient, and any attempt to do so with
respect to Unvested Award Shares shall be null and void ab initio, unless
(1) the Committee expressly authorizes such in writing, or (2) Unvested Award
Shares are transferred by the Recipient as a bona fide gift (i) to the spouse,
lineal descendant or lineal ascendant, siblings and children by adoption of the
Recipient, (ii) to a trust for the benefit of one or more individuals described
in clause (i) and no other persons, or (iii) to a partnership of which the only
partners are one or more individuals described in clause (i), in which case the
transferee shall be subject to all provisions of this Restricted Stock
Agreement. If Unvested Award Shares are transferred pursuant to (1) or
(2) above, the Recipient agrees to notify the Committee at least thirty
(30) days prior to such transfer, and the Committee may require that the
transferee thereof execute and deliver to the Company such documents and
agreements as the Company shall reasonably require to evidence the fact that the
Award Shares to be owned, either directly or beneficially, by such transferee
shall continue to be subject to all the restrictions set forth in this Agreement
and all applicable rights in favor of the Company set forth elsewhere herein,
and that such transferee is subject to and bound by such restrictions and
provisions. The restrictions of this Section 2.2 shall not apply to Vested Award
Shares.
     2.3 Dividends & Voting Rights. Recipient shall be entitled to dividends
paid or declared on Vested and Unvested Award Shares for which the record date
is on or after the date such Award Shares have been issued in the Recipient’s
name. Recipient shall be entitled to vote all Vested and Unvested Award Shares
for which the record date is on or after the date such Award Shares have been
issued in the Recipient’s name. Recipient shall have no rights whatsoever
(dividend, voting or otherwise) with respect to Award Shares which have been
forfeited under Section 2.1.
3     General Provisions
     3.1 Change in Capitalization. If the number of outstanding shares of the
Common Stock shall be increased or decreased by a change in par value, split-up,
stock split, reverse stock split, reclassification, distribution of common stock
dividend, or other similar capital adjustment, an appropriate adjustment shall
be made by the Board of Directors in the number and kind of Vested and Unvested
Award Shares, such that Recipient’s proportionate interest in Vested and
Unvested Award Shares shall be maintained as before the occurrence of the event.
No fractional shares shall be issued in making such adjustment. All adjustments
made by the Board of Directors under this Section shall be final, binding, and
conclusive.
     3.2 Legends . Each certificate representing the Award Shares shall be
endorsed with the following legend:
Shares are Restricted & Subject to Forfeiture

The securities evidenced by this certificate are subject to certain
restrictions (including restrictions on transferability) and are subject
to forfeiture, all as set forth in an Employee Restricted Stock

 

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Agreement dated [INSERT], a copy of which is available from the
Company.
     3.3 Removal of Legend . Any legend endorsed on a certificate representing
Award Shares pursuant to Section 3.2 above shall be removed and the Company
shall issue a certificate without such legend to the holder thereof if such
Award Shares become Vested Award Shares pursuant to this Agreement.
     3.4 Governing Laws. This Agreement shall be construed, administered and
enforced according to the laws of the State of Delaware.
     3.5 Successors. This Agreement shall be binding upon and inure to the
benefit of the heirs, legal representatives, successors, and permitted assigns
of the parties.
     3.6 Severability. In the event that any one or more of the provisions or
portion thereof contained in this Agreement shall for any reason be held to be
invalid, illegal, or unenforceable in any respect, the same shall not invalidate
or otherwise affect any other provisions of this Agreement, and this Agreement
shall be construed as if the invalid, illegal or unenforceable provision or
portion thereof had never been contained herein.
     3.7 Entire Agreement. Subject to the terms and conditions of the Plan, this
Agreement expresses the entire understanding and agreement of the parties with
respect to the subject matter. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which shall
constitute one and the same instrument.
     3.8 Headings. Paragraph headings used herein are for convenience of
reference only and shall not be considered in construing this Agreement.
     3.9 No Contractual Rights Created. Neither the establishment of the Plan
nor the award of Award Shares hereunder shall be construed as giving Recipient
the right to employment with, or the right to continued performance of services
for, the Company.
     3.10 Capitalized Terms. All capitalized terms used in this Agreement shall
have the meanings given to them herein or in the Plan.
     3.11 Specific Performance. In the event of any actual or threatened default
in, or breach of, any of the terms, conditions and provisions of this Agreement,
the party or parties who are thereby aggrieved shall have the right to specific
performance and injunction in addition to any and all other rights and remedies
at law or in equity, and all such rights and remedies shall be cumulative.
     3.12 No Disclosure Duty. The Recipient and the Company acknowledge and
agree that the Company and its directors, officers or employees have no duty or
obligation to disclose to the Recipient any material non-public information
regarding the business of the Company or affecting the value of the Award
Shares.
     IN WITNESS WHEREOF, the parties have executed and sealed this Agreement on
the day and year first set forth above.

         
Company:
Lodgian, Inc.:
By:
  Recipient:     
 
       
 
       
Its:
  [INSERT NAME]    
 
 
       

 

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Exhibit A
Definitions
A. Affiliate shall have the meaning ascribed to such term in Rule 12b-2
promulgated under the Securities Exchange Act of 1934, as amended.
B. Agreement shall mean this Employee Restricted Stock Agreement.
C. Associate shall have the meaning ascribed to such term in Rule 12b-2
promulgated under the Securities Exchange Act of 1934, as amended.
D. Award Shares shall mean the shares of common stock of the Company which are
awarded to the Recipient subject to the terms and conditions of this Agreement.
E. Base Salary shall mean the wages the Company pays Recipient on an annual
basis, exclusive of all benefits, bonuses, equity, commissions, or any other
incentive-based compensation.
F. Beneficial Owner shall mean shall have the meaning ascribed to that term in
Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended.
G. Cause shall mean, with respect to a termination of Recipient’s employment, a
termination by the Company because of any one of the following events:
          (i) Recipient’s willful refusal to follow the lawful direction of the
CEO and/or the person to whom Recipient reports or Recipient’s material failure
to perform Recipient’s duties (other than by reason of Disability), in either
case, only after Recipient has been given written notice by the CEO and/or the
person to whom Recipient reports detailing the directives Recipient has refused
to follow or the duties Recipient has failed to perform and at least 30 days to
cure;
          (ii) Recipient’s material and willful failure to comply with Company
policies as applied to Company employees, only after Recipient has been given
written notice by the CEO and/or the person to whom Recipient reports detailing
the policies with which Recipient has failed to comply and at least 30 days to
cure;
          (iii) Recipient’s engaging in any of the following conduct:
          (1) an act of fraud or dishonesty that materially harms the Company or
its Affiliates,
          (2) a felony or any violation of any federal or state securities law
or Recipient’s being enjoined from violating any federal or state securities law
or being determined to have violated any such law;
          (3) gross negligence in connection with any property or activity of
the Company and/or its Subsidiaries, Affiliates and successors;
          (4) repeated and intemperate use of alcohol or illegal drugs after
written notice from the CEO and/or the person to whom Recipient reports;
          (5) material breach of any of Recipient’s obligations under any
agreement between Recipient and the Company (other than by reason of physical or
mental illness or injury), but only after Recipient has been given written
notice of the breach by the CEO and/or the person to whom Recipient reports and
at least thirty (30) days to cure;
          (6) Recipient’s becoming barred or prohibited by the SEC from holding
Recipient’s position with the Company; or

 

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          (7) Recipient’s resignation for other than Good Reason.
H.      Change in Control means the first of the following to occur after the
date of this Agreement:
     (a) when any Person (other than the Company, any Subsidiary of the Company,
any employee benefit plan of the Company or of any Subsidiary of the Company, or
any person or entity organized, appointed or established by the Company or any
Subsidiary of the Company for or pursuant to the terms of any such plan), alone
or together with its Affiliates and Associates (collectively, an “Acquiring
Person”), shall become the Beneficial Owner of 40 percent or more of the then
outstanding shares of Common Stock or the Combined Voting Power of the Company;
     (b) when, during any period of two consecutive years, individuals who at
the beginning of such period constitute the Board of Directors of the Company
(the “Board”), and any new director (other than a director who is a
representative or nominee of an Acquiring Person) whose election by the Board or
nomination for election by the Company’s shareholders was approved by a vote of
at least a majority of the directors then still in office who either were
directors at the beginning of the period or whose election or nomination for
election was previously so approved (collectively, the “Continuing Directors”),
cease for any reason to constitute a majority of the Board;
     (c) the consummation of a merger or consolidation of the Company with any
other corporation, other than a merger or consolidation which would result in
the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted
into voting securities of the surviving entity or any Parent of such surviving
entity) at least a majority of the Combined Voting Power of the Company, such
surviving entity, or the Parent of such surviving entity outstanding immediately
after such merger or consolidation;
     (d) the consummation of a plan of reorganization (other than a
reorganization under the United States Bankruptcy Code) or complete liquidation
of the Company or an agreement for the sale or disposition by the Company of all
or substantially all of the Company’s assets, other than a sale of all or
substantially all of the Company’s assets to a transferee, the majority of whose
voting securities are held by the Company; or
     (e) when the shareholders of the Company approve an agreement for the sale
or disposition by the Company of all or substantially all of the Company’s
assets in a transaction or series of transactions to an entity that is not
owned, directly or indirectly, by the Company’s common stock shareholders in
substantially the same proportions as the owners of the Company’s common stock
before such transaction or series of transactions.
I. Code shall mean the Internal Revenue Code of 1986, as amended from time to
time.
J. Code §83(b) Election shall mean the election available to the recipient of
property transferred in connection with the performance of services to include
in gross income under Code §83(b) the excess of the fair market value of the
property transferred determined as of the time of transfer over the amount (if
any) paid for such property as compensation for services.
K. Combined Voting Power shall mean the combined voting power of the Company’s
or other relevant entity’s then outstanding voting securities.
L. Common Stock shall mean the common stock of the Company.
M. Company shall mean Lodgian, Inc., and any successor thereto.
N. Committee shall mean the Compensation Committee of the Board of Directors.
O. Continuous Service shall mean a period of continuous performance of services
by Recipient for the Company or an Affiliate, as determined by the Committee in
its sole and absolute discretion.

 

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P. Custodian shall mean the Secretary of the Company or such other officer of
the Company as may be designated by the Committee to hold Award Shares until
such time as any such Award Shares become Vested Award Shares.
Q. Disability shall mean a physical or mental impairment which renders You
unable to perform the essential functions of Your job even with reasonable
accommodation, as determined by the Company in its sole discretion.
R. Good Reason shall exist if (i) the Company, without Recipient’s written
consent, (A) takes any action which results in the material reduction of
Recipient’s then current duties or responsibilities, (B) reduces Recipient’s
then-current Base Salary, (C) reduces the benefits to which Recipient is
entitled on the Award Date, unless a similar reduction is made for other
executive employees, (D) commits a material breach of this Agreement, or
(E) requires Recipient to relocate more than fifty (50) miles from the location
where the Recipient performs services for the Company on the Award Date;
(ii) Recipient provides written notice to the Company of such action and
provides the Company with thirty (30) days to remedy such action (the “Cure
Period”), (iii) the Company fails to remedy such action within the Cure Period,
and (iv) Recipient resigns within ten (10) days of the expiration of the Cure
Period. Good Reason shall not include any isolated, insubstantial or inadvertent
action that (i) is not taken in bad faith, and (ii) is remedied by the Company
within the Cure Period.
S. Parent shall mean any corporation which is a “parent corporation” within the
meaning of Code §424(e) with respect to the Company.
T. Plan shall mean the Lodgian, Inc., Amended & Restated 2002 Stock Incentive
Plan.
U. Recipient shall mean the individual shown on this Agreement as the Recipient.
V. Subsidiary shall mean any corporation which is a “subsidiary corporation”
within the meaning of Code §424(f) with respect to the Company.
W. Unvested Award Shares shall mean the Award Shares which have not become
vested pursuant to the Vesting Schedule or otherwise.
X. Vested Award Shares shall mean the Award Shares which have become vested
pursuant to the Vesting Schedule or otherwise.

 

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Exhibit 1
ELECTION UNDER SECTION 83(b)
OF THE INTERNAL REVENUE CODE
     The undersigned taxpayer (the “Taxpayer”) hereby elects, pursuant to
Section 83(b) of the Internal Revenue Code of 1986, as amended, to include in
his gross income for the current taxable year, the amount of any compensation
taxable to him in connection with his receipt of the property described below:
     1. The name, address and taxpayer identification number of the undersigned
Taxpayer are as follows:

     
Name:
   
 
   
 
   
Address:
   
 
   
 
   
Social Security Number (TIN):
   
 
   

     2. The property with respect to which the election is made is:
                                                                     
                  shares of common stock of Lodgian, Inc.
     3. The date on which the property was transferred and the taxable year for
which this election is made are:

     
Date on Which Property Was Transferred:
   
 
   
 
   
Taxable Year for Which Election is Made:
   
 
   

     4. The property is subject to transferability, forfeiture and other
restrictions, all as set forth in a Restricted Stock Agreement between the
Taxpayer and Lodgian, Inc.
     5. The fair market value at the time of transfer, determined without regard
to any restriction other than a restriction which by its terms will never lapse,
of such property is:
$                                                             /Share x
                                                             Shares =
$                                                            
     6. No amount was paid for such property.
     The undersigned Taxpayer has submitted copies of this statement to Lodgian,
Inc., the person for whom the services were performed in connection with the
Taxpayer’s receipt of the above-described property. The Taxpayer is the person
performing the services in connection with the transfer of said property. The
undersigned Taxpayer understands that the foregoing election may not be revoked
except with the consent of the Commissioner, which will only be granted when the
Taxpayer is under a mistake of fact as to the underlying transaction and when
made within 60 days of the date such mistake of fact first became known to the
Taxpayer.
     The undersigned Taxpayer understands and acknowledges that, for this
election to be effective, copies of this completed election form must be filed
with the Internal Revenue Service (at the location where the Taxpayer’s income
tax return would be filed) not later than 30 days after the date the
above-described property was transferred to the Taxpayer, and must also be
submitted with the Taxpayer’s federal income tax return for the taxable year in
which the above-described property was transferred. A copy of this completed
election must also be submitted to Lodgian, Inc., along with full payment of
amounts required to be withheld under applicable law, not later than 30 days
after the date the above-described property was transferred to the Taxpayer.

                  Dated this                                          day of
                                        , 20               .
 
  Signature:                       Name of Taxpayer:    
 
           

 

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Exhibit 2
WITHHOLDING ELECTION

     
TO: Lodgian, Inc.
  Restricted Stock Agreement:
RE: Withholding Election

  Restricted Stock Agreement between the Recipient (designated below) and
Lodgian, Inc. (the “Company”).
This election relates to the number of shares of common stock of the Company
which will vest on the date noted below (the “Vesting Shares”):

Number of Vesting Shares:                                         
  Date of Agreement:
 

Total Number of Restricted Shares subject to Restricted Stock Agreement:
 
   
Date of Vesting:                                                             
   

I, the undersigned Recipient, hereby certify that:
1. My correct name and social security number and my current address are set
forth at the end of this document.
2. I have read and understand the Restricted Stock Agreement and the various
methods by which withholding obligations regarding the Vesting Shares subject to
the Restricted Stock Agreement may be satisfied.
3. I do hereby elect the following method of withholding pursuant to Section 1.5
of the Restricted Stock Agreement with respect to any withholding or other tax
obligations (whether federal, state or local) imposed on the Company by reason
of the substantial vesting of the Vesting Shares (the “Withholding
Obligations”), assuming that I have met all requirements under the Plan relative
to such election and such election is approved by the Company:

o   In accordance with Section 1.5(b)(1), I hereby elect to pay to the Company
the entire amount of all Withholding Obligations with respect to the Vesting
Shares in cash or by check on or before the Date of Vesting.

o   In accordance with Section 1.5(b)(2), I hereby elect that the entire amount
of all Withholding Obligations with respect to the Vesting Shares should be paid
by having the Company repurchase the smallest whole number of the Vested Shares
which, when multiplied by the fair market value per share of the common stock of
the Company as of the close of business on the business day which is coincident
with or immediately follows the Date of Vesting, will be sufficient to satisfy
the amount of such Withholding Obligations, and applying all the proceeds from
such repurchase to such Withholding Obligations. I further acknowledge and
understand that the repurchase by the Company of any Vested Shares may result in
tax consequences to me.

o   In accordance with Section 1.5(b)(3), I hereby elect for the Company to
withhold substantially equal amounts from my future compensation so that the
total of such amounts shall, as of the Date of Vesting, be designed to be
sufficient to satisfy the amount of all Withholding Obligations with respect to
the Vesting Shares.

4. I understand that capitalized terms used in this Notice of Withholding
Election without definition herein shall have the meanings given to them in the
Restricted Stock Agreement and in the Plan.
Recipient:

     
Dated this                                          day of
                                        , 20                    
   
 
   
Recipient’s Address:
   
 
   
 
 
   
 
 
   
 
 
  Printed Name:
 
 
   
 
 
  Social Security Number:                   
—                   —