exv10w4







 




    Exhibit 10.4



 




    REUNION
    HOSPITALITY TRUST, INC.



 




    EMPLOYMENT
    AGREEMENT




 



    EMPLOYMENT AGREEMENT (this “Agreement”),
    dated as
    of                    ,
    2010, between Reunion Hospitality Trust, Inc., a Maryland
    corporation, its successors or assigns (the
    “Company”), and Jason N. Ader (the
    “Employee”).




 




    W
    I T N E S S E
    T H



 



    WHEREAS, the Company intends to complete an initial
    public offering and a concurrent private placement (the
    “Offering”) of its common stock;



 



    WHEREAS, the Company desires to employ the Employee as
    Executive Chairman of the Company following the Company’s
    Offerings;



 



    WHEREAS, the Company and the Employee desire to enter
    into this Agreement as to the terms of the Employee’s
    employment as the Executive Chairman of the Company;



 



    WHEREAS, the Employee’s agreement to be employed by
    the Company as of the Effective Date (as defined in
    Section 2 hereof) is a material inducement to the Company
    to enter into this Agreement as of the date hereof and the date
    of the Offering;



 



    NOW, THEREFORE, in consideration of the foregoing, of the
    mutual promises contained herein and of other good and valuable
    consideration, the receipt and sufficiency of which are hereby
    acknowledged, the parties hereto hereby agree as follows:



 


		
	
    1.  
	
    POSITION
    AND DUTIES.




 



    (a) During the Employment Term (as defined in Section 2
    hereof), the Employee shall serve as the Executive Chairman of
    the Company. In this capacity, the Employee shall have all
    duties, authorities and responsibilities commensurate with the
    duties, authorities and responsibilities of persons in similar
    capacities in similarly sized companies, and such other duties,
    authorities and responsibilities as the Board of Directors of
    the Company (the “Board”) shall designate from
    time to time that are not inconsistent with the Employee’s
    position as the Executive Chairman of the Company. The Employee
    shall report to the Board.



 



    (b) During the Employment Term, the Employee shall devote such
    portion of his time to the Company’s affairs as is
    necessary to enable the Company to effectively operate the
    Company’s business and the Employee’s best efforts to
    the performance of the Employee’s duties with the Company;
    provided, that the foregoing shall not prevent the
    Employee from (i) serving Hayground Cove Asset Management
    LLC, Hayground Cove Capital Partners, Western Liberty Bancorp,
    India Hospitality Corp. or their respective affiliates, so long
    as such service does not, in any material way, limit the
    operations of the Company, (ii) serving on the boards of
    directors of organizations on whose boards of directors he
    currently sits that have been disclosed to the Board (including,
    without limitation, Las Vegas Sands Corp.) or those of
    non-profit organizations and, with the prior written approval of
    the Board (or the applicable committee(s) thereof) in each
    instance, other for-profit companies, (iii) participating
    in charitable, civic, educational, professional, community or
    industry affairs or serving on advisory boards and committees,
    and (iv) managing the Employee’s passive personal
    investments; provided further, that without
    derogating from the foregoing, in no event shall the Employee be
    obligated to devote any specific portion of his time to the
    Company’s affairs.



 



    2.  EMPLOYMENT TERM. The Company agrees to
    employ the Employee pursuant to the terms of this Agreement, and
    the Employee agrees to be so employed, from the period
    commencing as of the






    

    1








 








     Effective Date and ending on December 31, 2013 (the
    “Initial Term”). Notwithstanding anything
    herein to the contrary, the Employee agrees that he shall not
    terminate this Agreement prior to the Effective Date. In
    addition, prior to the Effective Date, the Employee shall agree
    to cooperate and permit the Company to use his name in
    regulatory filings that he has approved, which approval shall
    not unreasonably be withheld or delayed. Upon the expiration of
    the Initial Term and each Renewal Term (as defined below), as
    the case may be, the term of this Agreement shall be
    automatically extended for successive one-year periods (each, a
    “Renewal Term”), provided,
    however, that either party hereto may elect not to extend
    the term of this Agreement by giving written notice to the other
    party at least 90 days prior to the expiration of the
    Initial Term or any Renewal Term. Notwithstanding the foregoing,
    the Employee’s employment hereunder may be earlier
    terminated at any time during the Initial Term or any Renewal
    Term in accordance with Section 8 hereof, subject to
    Section 9 hereof. The period of time between the Effective
    Date and the termination of the Employee’s employment
    hereunder for any reason shall be referred to herein as the
    “Employment Term.” For purposes of this
    Agreement, “Effective Date” means the date upon
    which the Offering is consummated.




 



    3.  INITIAL BASE SALARY. From the Effective
    Date until the occurrence of the earlier of (x) the
    satisfaction of the Capital Deployment Hurdle (as defined
    herein) or (y) 12 months from the Effective Date, the
    Company agrees to pay the Employee an annual base salary that
    initially shall be $150,000 (the “Initial Base
    Salary”). The Initial Base Salary shall be payable in
    accordance with the regular payroll practices of the Company.



 



    4.  CONTINUING BASE SALARY. Upon the occurrence
    of the earlier of (x) the satisfaction of the Capital
    Deployment Hurdle or (y) 12 months from the Effective
    Date, the Employee’s base salary shall be increased to
    $250,000.00 (the “Continuing Base Salary”). The
    Continuing Base Salary shall be subject to annual review by the
    Board (or a committee thereof), and, subject to Section 5
    below, may be increased, but not decreased below its then
    current level, from time to time by the Board.



 



    For purposes of this Agreement, the “Capital Deployment
    Hurdle” means the threshold at which the PI Transaction
    Value of all completed Permitted Investments exceeds 75% of the
    Escrow Proceeds. For purposes of this Agreement, “Escrow
    Proceeds” means 98% of the Net Proceeds, which will be
    placed in escrow with The Bank of New York Mellon, as escrow
    agent, solely for use in connection with Permitted Investments.
    For purposes of this Agreement, “PI Transaction
    Value” means, without duplication, the sum of
    (i) the cost of such Permitted Investment, whether
    consummated or subject to definitive documentation pursuant to
    which the Company provides a commitment of capital to consummate
    such Permitted Investment; (ii) the amount of debt which is
    senior in the capital structure to, or pari passu with, each
    Permitted Investment (such as, in the event the Company makes a
    mezzanine loan to a hotel owner, the amount of any mortgage loan
    encumbering the hotel), only to the extent such Permitted
    Investment, after consultation with third party accountants,
    would reasonably be expected to be required to be consolidated
    on the Company’s balance sheet pursuant to
    U.S. generally accepted accounting principles
    (“GAAP”); (iii) any equity with a
    liquidation preference which is senior to, or pari passu with,
    each Permitted Investment (such as, in the event the Company
    purchases common equity in an entity that owns hotel properties,
    any outstanding preferred equity issued by such entity which has
    a liquidation preference senior in priority to the
    Company’s investment), only to the extent such Permitted
    Investment, after consultation with third party accountants,
    would reasonably be expected to be required to be consolidated
    on the Company’s balance sheet pursuant to GAAP;
    (iv) estimated closing costs, due diligence costs and
    applicable transaction expenses; and (v) estimated amounts
    needed to cover future capital and funding commitments relating
    to such Permitted Investment (as set forth in a written
    agreement or budget) including, without limitation, capital
    expenditures, escrows and follow-on investments or advances.
    For purposes of this Agreement, “Permitted
    Investment” means hospitality and related investments,
    with a focus on distressed opportunities primarily in the United
    States and Canada. For purposes of this Agreement, “Net
    Proceeds” means the gross proceeds from the Offering
    less the underwriting discounts and commissions and estimated
    offering and organizational costs and offering expenses.





    

    2








 







    5.  ANNUAL SALARY INCREASE; ANNUAL BONUS.
    During the Employment Term, Employee shall receive an annual
    salary increase equal to the greater of (i) 3% of
    Employee’s Initial Base Salary or Continuing Base Salary,
    as the case may be, or (ii) the annual percentage increase
    cost of living in the city of New York as determined by the
    Compensation Committee of the Board. In addition, during the
    Employment Term, the Employee shall be eligible to receive an
    annual discretionary incentive payment under the Company’s
    annual bonus plan as in effect from time to time equal to either
    50%, 75% or 125% of Employee’s Initial Base Salary or
    Continuing Base Salary, as the case may be (the “Annual
    Bonus”), upon the attainment of one or more
    pre-established performance goals established by the
    Company’s Compensation Committee and approved by the
    Company’s Board of Directors, which shall include, but not
    be limited to, operating the Company in a safe and sound manner
    and complying with all federal or state laws, rules and
    regulations.



 



    6.  EQUITY AWARDS. During the Employment Term,
    the Employee shall be eligible to receive equity and long-term
    incentive awards under any equity-based incentive compensation
    plan adopted by the Company during the Employment Term for which
    the Company’s senior executives are generally eligible. The
    level of the Employee’s participation in any such plan, if
    any, shall be determined in the sole discretion of the Board
    from time to time.



 


		
	
    7.  
	
    EMPLOYEE
    BENEFITS; CHANGE IN CONTROL BENEFITS.




 



    (a) BENEFIT PLANS. During the Employment Term, the
    Employee shall be entitled to participate, in accordance with
    the Company’s policies, in any employee benefit plan that
    the Company has adopted or may adopt, maintain or contribute to
    for the benefit of its employees generally from time to time,
    including health, vision, dental, disability, and life in a
    manner commensurate with other employees of the Company, and in
    accordance with, and subject to, the terms and conditions
    thereof, including satisfying the applicable eligibility
    requirements. Notwithstanding the foregoing, the Company may in
    its sole discretion modify or terminate any employee benefit
    plan at any time.



 



    (b) VACATIONS; SICK LEAVE. During the Employment Term,
    the Employee shall be entitled to four weeks of paid vacation
    per calendar year (as prorated for partial years) in accordance
    with the Company’s policy on accrual and use applicable to
    employees as in effect from time to time. The Employee agrees
    that any vacation taken by the Employee during the Employment
    Term shall be taken at times which are mutually determined by
    the Chief Executive Officer of the Company and the Employee not
    to interfere, in any material respect, with the Employee’s
    performance of his duties hereunder. During the Employment Term,
    the Employee shall be entitled to up to 30 days of sick
    leave per calendar year for use in accordance with the
    Company’s policy on accrual and use applicable to employees
    as in effect from time to time.



 



    (c) BUSINESS AND ENTERTAINMENT EXPENSES. Upon
    presentation of appropriate documentation, the Employee shall be
    reimbursed in accordance with the Company’s expense
    reimbursement policy, for all reasonable business and
    entertainment expenses reasonably incurred in connection with
    the performance of the Employee’s duties hereunder and the
    Company’s policies with regard thereto.



 



    (d) CHANGE IN CONTROL PAYMENT. If there is a Change in
    Control during the Employment Terms and the Employee is
    terminated without Cause or the Employee resigns for Good Reason
    (as defined herein) within six months following such Change in
    Control, the Employee shall be entitled to (a) (x) payment
    of any accrued but unpaid Initial Base Salary or Continuing Base
    Salary, as the case may be, through the date of termination,
    paid in accordance with the regular payroll practices of the
    Company; (y) reimbursement for any outstanding reasonable
    business expenses and (z) 100% vesting of any unvested
    securities previously awarded to the Employee using a time-based
    method of vesting (collectively, the “CIC Accrued
    Benefits”), (b) within 10 days of
    termination, a single lump sum payment in an amount equal to
    (x) three times the Employee’s Initial Base Salary or
    Continuing Base Salary, as the case may be, plus (y) three
    times the Employee’s average Annual Bonus paid over the
    prior three years or such lesser period






    

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    a bonus has been paid and (c) retain any Company provided
    mobile phone. For purposes of this Agreement, a “Change
    in Control” means a change in control of the Company
    which will be deemed to have occurred after the date hereof if:



 



    (i) any “person” as such term is used in
    Section 3(a)(9) of the Exchange Act, as modified and used
    in Sections 13(d) and 14(d) thereof except that such term
    shall not include (A) the Company or any of its
    subsidiaries, (B) any trustee or other fiduciary holding
    securities under an employee benefit plan of the Company or any
    of its affiliates, (C) an underwriter temporarily holding
    securities pursuant to an offering of such securities,
    (D) any corporation owned, directly or indirectly, by the
    shareholders of the Company in substantially the same
    proportions as their ownership of the Company’s common
    shares, or (E) any person or group as used in Rule
    13d-1(b)
    under the Exchange Act, is or becomes the Beneficial Owner, as
    such term is defined in
    Rule 13d-3
    under the Exchange Act, directly or indirectly, of securities of
    the Company representing at least 50% of the combined voting
    power or common shares of the Company;



 



    (ii) during any period of two consecutive years, individuals who
    at the beginning of such period constitute the Board or whose
    election by the Board or nomination for election by the
    Company’s shareholders was approved by a vote of at least
    two-thirds of the Board then still in office cease for any
    reason to constitute at least a majority thereof;



 



    (iii) there is consummated a merger or consolidation of the
    Company or any direct or indirect subsidiary 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 thereof)
    in combination with the ownership of any trustee or other
    fiduciary holding securities under an employee benefit plan of
    the Company or any subsidiary of the Company, more than 50% of
    the combined voting power and common shares of the Company or
    such surviving entity or any parent thereof outstanding
    immediately after such merger or consolidation; or



 



    (iv) there is consummated an agreement for the sale or
    disposition by the Company of all or substantially all of the
    Company’s assets (or any transaction having a similar
    effect, including a liquidation) other than a sale or
    disposition by the Company of all or substantially all of the
    Company’s assets to an entity, more than 50% of the
    combined voting power and common shares of which is owned by
    shareholders of the Company in substantially the same
    proportions as their ownership of the common shares of the
    Company immediately prior to such sale.



 



    8.  TERMINATION. The Employee’s employment
    under this Agreement
    and/or the
    Employment Term shall terminate on the first of the following to
    occur, whether before or after the Effective Date:



 



    (a) DISABILITY. Upon the Employee’s receipt of
    written notice from the Company of termination due to
    Disability. For purposes of this Agreement,
    “Disability” shall be defined as the inability
    of the Employee to have performed the Employee’s material
    duties hereunder due to a physical or mental injury, infirmity
    or incapacity for 180 consecutive or non-consecutive days
    (including weekends and holidays) in any
    365-day
    period. Disability shall be determined by the Board, in its
    discretion, and any such determination shall be final and
    binding on all parties.



 



    (b) DEATH. Automatically on the date of death of the
    Employee.



 



    (c) CAUSE. Cause, as determined in this Section. The
    Company shall not allege the existence of Cause without the
    determination of such by the affirmative vote of a majority of
    the entire Board. The Employee shall be entitled to written
    notice from the Company of, together with a reasonably detailed
    description of the basis for, any such determination that Cause
    exists with respect to the Employee. The Employee’s
    employment under this Agreement
    and/or the
    Employment Term shall terminate for Cause upon the 30th calendar
    day following the Employee’s receipt of such written notice
    from the Company, unless within such
    30-day
    period, the Employee has (x) cured such Cause (subject to
    any limitations below) or (y) given written notice to the
    Company of the Employee’s claim that Cause






    

    4








 







    does not exist, together with a reasonably detailed description
    of the basis for such claim; provided, that if the Company and
    the Employee are unable to resolve such claim within such
    30-day
    period, then such claim shall be submitted for resolution by
    arbitration to be held in the City and County of New York in
    accordance with the rules of the American Arbitration
    Association then in effect (before a panel of three arbitrators
    chosen in accordance with such rules), but in any event
    providing for discovery on the same basis as if the dispute were
    being litigated under the Federal Rules of Civil Procedure. If
    the final outcome of any such arbitration is that Cause does
    exist, then the Employee’s employment
    and/or the
    Employment Term shall terminate for Cause within 30 additional
    days after the Employee’s receipt of written notice of such
    outcome, unless the Employee has cured such Cause within such
    additional
    30-day
    period; provided, that repetition of the same refusal or failure
    that has previously been determined hereunder to have
    constituted Cause under subsection (ii) below may not be
    cured. “Cause” shall mean any of the following:



 



    (i) the Employee’s willful misconduct or gross negligence
    in the performance of the Employee’s duties to the Company
    that has or could reasonably be expected to have an adverse
    effect on the Company;



 



    (ii) the Employee’s refusal or failure to follow the written lawful directives of the Board (other than as a result of death
    or a physical or mental incapacity);



 



    (iii) indictment for, conviction of, or pleading of guilty or
    nolo contendere to, a felony or any crime involving moral
    turpitude (none of which shall be subject to cure as provided
    above);



 



    (iv) the Employee’s embezzlement or misappropriation of
    corporate funds or other acts of theft, fraud, malfeasance,
    self-dealing, dishonesty or breach of fiduciary duty in
    connection with the performance of the Employee’s duties to
    the Company;



 



    (v) breach of Section 11 of this Agreement; or



 



    (vi) material breach of any other Section of this Agreement or
    any other agreement with the Company or a violation of the
    Company’s code of conduct or other written policy.



 



    (d) WITHOUT CAUSE. Immediately upon the Employee’s
    receipt of written notice from the Company of an involuntary
    termination without Cause (other than for death or Disability).



 



    (e) GOOD REASON. Good Reason as determined in this
    Section. The Company shall be entitled to written notice from
    the Employee of, together with a reasonably detailed description
    of the basis for, any allegation by the Employee that Good
    Reason exists. Any claim that Good Reason exists shall be deemed
    irrevocably waived by the Employee unless the Board receives
    such written notice from the Employee within 60 days
    following the date on which the Employee first becomes aware of
    the event the Employee claims constitutes Good Reason. The
    Employee’s employment under this Agreement
    and/or the
    Employment Term shall terminate for Good Reason upon the 30th
    calendar day following the Employee’s receipt of such
    written notice from the Employee, unless within such
    30-day
    period, the Company has (x) cured such Good Reason or
    (y) given written notice to the Employee of the
    Company’s claim that Good Reason does not exist, together
    with a reasonably detailed description of the basis for such
    claim; provided, that if the Company and the Employee are unable
    to resolve such claim within such
    30-day
    period, then such claim shall be submitted for resolution by
    arbitration to be held in the City and County of New York in
    accordance with the rules of the American Arbitration
    Association then in effect (before a panel of three arbitrators
    chosen in accordance with such rules), but in any event
    providing for discovery on the same basis as if the dispute were
    being litigated under the Federal Rules of Civil Procedure. If
    the final outcome of any such arbitration is that Good Reason
    does exist, then the Employee’s employment
    and/or the
    Employment Term shall terminate for Good Reason within 30
    additional days after the Company’s receipt of written
    notice of such outcome, unless the Company has cured the
    circumstances that gave rise to such Good Reason within such
    additional
    30-day
    period.; provided, that repetition of the same diminution,
    action or inaction that has






    

    5








 







    previously been determined hereunder to constitute Good Reason
    under any of clauses (i) through (iii) below may not
    be cured. “Good Reason” shall mean the
    occurrence of any of the following events without the written
    consent of the Employee:



 



    (i) diminution in the Employee’s Initial Base Salary or
    Continuing Base Salary, as the case may be;



 



    (ii) a material diminution of the Employee’s authority,
    duties and responsibilities; or



 



    (iii) any other action or inaction that constitutes a breach by
    the Company of a material provision of this Agreement.



 



    (f) RESIGNATION. Ninety days following the Company’s
    receipt of a written notice setting forth the Employee’s
    resignation without Good Reason; provided, that upon
    receipt of such notice the Company may, in its sole discretion,
    make such termination effective at an earlier date and the
    termination shall still be treated as a voluntary termination by
    the Employee without Good Reason.



 



    (g) EXPIRATION OF EMPLOYMENT TERM; NON-EXTENSION OF
    AGREEMENT. Upon the expiration of the Employment Term due to
    a non-extension of the Agreement by the Company or the Employee
    pursuant to the provisions of Section 2 hereof.



 


		
	
    9.  
	
    CONSEQUENCES
    OF TERMINATION.




 



    (a) DEATH. In the event that the Employee’s
    employment and the Employment Term ends on or after the
    Effective Date on account of the Employee’s death, the
    Employee’s estate shall be entitled to the following:



 



    (i) a lump sum payment equal to the sum of (x) any unpaid
    Initial Base Salary or Continuing Base Salary, as the case may
    be, through the date of termination, plus (y) the Initial
    Base Salary or Continuing Base Salary payable for the remainder
    of the Employment Term then in effect, plus (z) the
    Employee’s average Annual Bonus paid over the prior three
    years (or such lesser period during which an Annual Bonus has
    been paid), paid on the 60th day from the date of termination;



 



    (ii) reimbursement for any reasonable business expenses incurred
    through the date of termination pursuant to, and paid in
    accordance with, Sections 7(c) and 24(b)(iii) of this
    Agreement;



 



    (iii) any accrued but unused vacation time or sick leave days
    paid in accordance with Company policy;



 



    (iv) such vested accrued benefits, if any, as to which the
    Employee may be entitled under the Company’s employee
    benefit plans and programs applicable to the Employee as of the
    date of termination, which shall be paid or provided in
    accordance with the terms of the applicable plan or
    program; and



 



    (v) the vesting as of the date of termination of any unvested
    securities previously issued to the Employee using a time-based
    method of vesting (collectively, Sections 9(a)(i) through
    9(a)(v) hereof shall be hereafter referred to as the
    “Accrued Benefits”).



 



    (b) DISABILITY. In the event that the Employee’s
    employment
    and/or
    Employment Term ends on or after the Effective Date on account
    of the Employee’s Disability, the Company shall pay or
    provide the Employee with the Accrued Benefits.



 



    (c) TERMINATION FOR CAUSE OR AS A RESULT OF NON-EXTENSION OF
    THIS AGREEMENT. If the Employee’s employment is
    terminated (i) by the Company for Cause or (ii) as a
    result of the non-extension of the Employment Term as provided
    in Section 2 hereof, the Company shall pay to the Employee
    any accrued but unpaid Initial Base Salary or Continuing Base
    Salary, as the case may be, from the Effective Date through the
    date of termination, paid in accordance with the regular payroll
    practices of the Company, except as required otherwise by law.
    Employee’s access to the Company’s






    

    6








 







    employee benefit plans and programs applicable to the Employee
    shall terminate as of the date of termination, except as
    required otherwise by law.



 



    (d) TERMINATION WITHOUT CAUSE OR FOR GOOD REASON. If the
    Employee’s employment by the Company is terminated on or
    after the Effective Date (x) by the Company without Cause
    (other than for death or Disability), or (y) by the
    Employee for Good Reason, the Company shall pay or provide the
    Employee with the CIC Accrued Benefits and, subject to the
    Employee’s compliance with the obligations in
    Sections 10, 11 and 12 hereof, the following, subject to
    the provisions of Section 24 hereof:



 



    (i) a lump sum payment equal to (x) three times the
    Employee’s Initial Base Salary or Continuing Base Salary
    Rate, as the case may be, plus (y) three times the
    Employee’s average Annual Bonus paid over the prior three
    years (or over such lesser period in which the Annual Bonus was
    paid), paid on the 60th day following the termination of
    employment; and



 



    (ii) subject to (A) the Employee’s timely election of
    continuation coverage under the Consolidated Omnibus Budget
    Reconciliation Act of 1985, as amended
    (“COBRA”), and (B) the Employee’s
    continued co-payment of premiums at the same level and cost to
    the Employee as if the Employee were an employee of the Company
    (excluding, for purposes of calculating cost, an employee’s
    ability to pay premiums with pre-tax dollars) (the
    “active employee rate”), continued
    participation in the Company’s group health plan and life
    insurance plan (to the extent permitted under applicable law and
    the terms of such plan), which covers the Employee for a period
    of up to 12 months at the Company’s expense (other
    than as set forth in
    sub-section
    (B)), provided, that the Employee is eligible and remains
    eligible for COBRA coverage; and provided, further, that in the
    event that the Employee obtains other employment that offers
    group health benefits, Company’s contribution to the
    coverage under this Section 9(d)(ii) shall immediately
    cease and thereafter shall be the sole responsibility of the
    Employee. Notwithstanding the foregoing, if the benefits under
    the Company’s group health plan will be taxable to the
    Employee, then in lieu of the Company’s payments for such
    continued participation, the Company shall reimburse the
    Employee, subject to the terms herein, for his premiums for
    continued coverage under such plan in the amount that the cost
    of such coverage exceeds the active employee rate (as determined
    based on the Employee’s premium rate in effect on the date
    of termination).



 



    Payments and benefits provided in this Section 9(d)(ii)
    shall be in lieu of any termination or severance payments or
    benefits for which the Employee may be eligible under any of the
    plans, policies or programs of the Company.



 



    (e) RESIGNATION. In the event that the Employee’s
    employment and the Employment Term ends on or after the
    Effective Date on account of the Employee’s resignation,
    the Employee shall be entitled to the following:



 



    (i) any unpaid Initial Base Salary or Continuing Base Salary, as
    the case may be, from the Effective Date through the date of
    termination, paid in accordance with the regular payroll
    practices of the Company;



 



    (ii) reimbursement for any unreimbursed business expenses
    incurred through the date of termination pursuant to, and paid
    in accordance with, Sections 7(c) and 24(b)(iii) of this
    Agreement;



 



    (iii) any accrued but unused vacation time or sick leave days
    paid in accordance with Company policy; and



 



    (iv) such vested accrued benefits, if any, as to which the
    Employee may be entitled under the Company’s employee
    benefit plans and programs applicable to the Employee as of the
    date of termination (other than any severance pay plan), which
    shall be paid or provided in accordance with the terms of the
    applicable plan or program.





    

    7








 







    (f) OTHER OBLIGATIONS. Upon any termination of the
    Employee’s employment with the Company, the Employee shall
    promptly resign from any other position as an officer, director
    or fiduciary of any Company-related entity.



 



    10.  RELEASE; NO MITIGATION. Any and all
    amounts payable and benefits or additional rights provided to
    the Employee upon a termination of his employment pursuant to
    Section 9 shall only be payable or provided if the Employee
    delivers to the Company and does not revoke a general release of
    claims in favor of the Company and certain related parties in
    the form attached hereto as Exhibit A, which the
    Company shall provide to the Employee within seven days
    following the date of termination. Such release shall be
    executed and delivered (and no longer subject to revocation, if
    applicable) within 60 days following termination. In no
    event shall the Employee be obligated to seek other employment
    or take any other action by way of mitigation of the amounts
    payable to the Employee under any of the provisions of this
    Agreement, nor shall the amount of any payment hereunder be
    reduced by any compensation earned by the Employee as a result
    of employment by a subsequent employer, except as provided in
    Section 9(d)(ii) hereof. The Employee shall not be entitled
    to any release of claims from the Company in favor of the
    Employee.



 


		
	
    11.  
	
    RESTRICTIVE
    COVENANTS.




 



    (a) CONFIDENTIALITY. The Employee agrees that the
    Employee shall not, directly or indirectly, use, make available,
    sell, disclose or otherwise communicate to any person, other
    than in the course of the Employee’s assigned duties and
    for the benefit of the Company, following the date of this
    Agreement, any business and technical information or trade
    secrets, nonpublic, proprietary or confidential information,
    knowledge or data relating to the Company, any of its
    subsidiaries, affiliated companies or businesses, which shall
    have been obtained by the Employee following the date of this
    Agreement. The foregoing shall not apply to information that
    (A) was known to the public prior to its disclosure to the
    Employee; (B) becomes generally known to the public
    subsequent to disclosure to the Employee through no wrongful act
    of the Employee or any representative of the Employee; or
    (C) the Employee is required to disclose by applicable law,
    regulation or legal process (provided, that the Employee
    provides the Company with prior notice of the contemplated
    disclosure and cooperates with the Company at its expense in
    seeking a protective order or other appropriate protection of
    such information).



 



    (b) NONCOMPETITION. The Employee acknowledges that during
    the Employment Term, the Employee’s performance of the same
    services he provides for the Company for any Competing Business
    will result in irreparable harm to the Company. Accordingly,
    during the Employee’s employment hereunder and for a period
    of one year after such employment terminates, the Employee
    agrees that the Employee will not, directly or indirectly, own,
    manage, operate, control, be employed by (whether as an
    employee, consultant, independent contractor or otherwise, and
    whether or not for compensation) or render services to any
    person, firm, corporation or other entity in whatever form,
    except for those set forth in Section 1(b), with respect to
    the conduct of a Competing Business; provided,
    however, that the Employee shall not be subject to the
    provisions of this Section 11(b) to the extent the Employee
    elects to forego the receipt of any severance payments or
    benefits the Employee is otherwise entitled to receive pursuant
    to this Agreement upon or following termination. Notwithstanding
    the foregoing, nothing herein shall prohibit the Employee from
    being, either directly or indirectly, a passive owner of not
    more than 9.9% of the equity securities of a publicly traded
    corporation the principal business of which is a Competing
    Business. For purposes of this Agreement, “Competing
    Business” means any person or entity that, as a
    principal or substantial part of its business, invests in and
    acquires hospitality and related investments, primarily in the
    United States and Canada, or any other material business in
    which the Company or any of its subsidiaries or affiliates are
    engaged on the date of termination or have expended substantial
    resources to investigate and have determined to engage on or
    after such date, but does not mean any business that principally
    invests in or acquires gaming or restaurant investments.



 



    (c) NONSOLICITATION; NONINTERFERENCE. From the date of
    this Agreement through and including the six months following
    the termination of the Employee’s employment with the
    Company, the






    

    8








 







    Employee agrees that the Employee shall not, except in the
    furtherance of the Employee’s duties hereunder, directly or
    indirectly, individually or on behalf of any other person, firm,
    corporation or other entity: (A) solicit, aid or induce any
    employee, representative or agent of the Company or any of its
    subsidiaries or affiliates to leave such employment or retention
    or to accept employment with or render services to or with any
    other person, firm, corporation or other entity unaffiliated
    with the Company or hire or retain any such employee,
    representative or agent, or take any action to materially assist
    or aid any other person, firm, corporation or other entity in
    identifying, hiring or soliciting any such employee,
    representative or agent; or (B) interfere, or aid or induce
    any other person or entity in interfering, with the relationship
    between the Company or any of its subsidiaries or affiliates and
    any of their respective vendors, joint venturers or licensors.



 



    (d) RETURN OF COMPANY PROPERTY. Except as otherwise
    provided herein, on the date of the Employee’s termination
    of employment with the Company for any reason (or at any time
    prior thereto at the Company’s request), the Employee shall
    return all property belonging to the Company or its affiliates
    (including, but not limited to, any Company-provided equipment,
    or documents and property belonging to the Company).



 



    (e) REFORMATION. If it is determined by a court of
    competent jurisdiction in any state that any restriction in this
    Section 11 is excessive in duration or scope or is
    unreasonable or unenforceable under the laws of that state, it
    is the intention of the parties that such restriction may be
    modified or amended by the court to render it enforceable to the
    maximum extent permitted by the laws of that state.



 



    (f) TOLLING. In the event of any violation of the
    provisions of this Section 11, the Employee acknowledges
    and agrees that the post-termination restrictions contained in
    this Section 11 shall be extended by a period of time equal
    to the period of such violation, it being the intention of the
    parties hereto that the running of the applicable
    post-termination restriction period shall be tolled during any
    period of such violation.



 



    (g) SURVIVAL OF PROVISIONS. The obligations contained in
    Sections 11 and 12 hereof shall survive the termination or
    expiration of this Agreement, the Employment Term
    and/or the
    Employee’s employment with the Company and shall be fully
    enforceable thereafter.



 



    12.  COOPERATION. Upon the receipt of
    reasonable notice from the Company (including its outside
    counsel), the Employee agrees that while employed by the Company
    and thereafter, the Employee will respond and provide
    information with regard to matters in which the Employee has
    knowledge as a result of the Employee’s employment with the
    Company, and will provide reasonable assistance to the Company,
    its affiliates and their respective representatives in defense
    of any claims that may be made against the Company or its
    affiliates, and will assist the Company and its affiliates in
    the prosecution of any claims that may be made by the Company or
    its affiliates, to the extent that such claims may relate to the
    period of the Employee’s employment with the Company. The
    Employee agrees to promptly inform the Company if the Employee
    becomes aware of any lawsuits involving such claims that may be
    filed or threatened against the Company or its affiliates. The
    Employee also agrees to promptly inform the Company (to the
    extent that the Employee is legally permitted to do so) if the
    Employee is asked to assist in any investigation of the Company
    or its affiliates (or their actions), regardless of whether a
    lawsuit or other proceeding has then been filed against the
    Company or its affiliates with respect to such investigation,
    and shall not do so unless legally required. If the Employee is
    required to provide services pursuant to this Section 12,
    then, in accordance with its reimbursement policies and
    procedures as in effect, including the timely submission of
    proper documentation supporting such expenses, the Company will
    pay (or reimburse the Employee for) reasonable
    out-of-pocket
    travel, lodging, communication, duplication and legal expenses
    incurred in connection with the performance of such services.



 



    13.  EQUITABLE RELIEF AND OTHER REMEDIES. The
    Employee acknowledges and agrees that the Company’s
    remedies at law for a breach or threatened breach of any of the
    provisions of Section 11 or Section 12 hereof would be
    inadequate and, in recognition of this fact, the Employee agrees
    that, in the event of such a breach or threatened breach, in
    addition to any remedies at law, the Company,






    

    9








 







    without posting any bond, shall be entitled to obtain equitable
    relief in the form of specific performance, a temporary
    restraining order, a temporary or permanent injunction or any
    other equitable remedy which may then be available. In the event
    of a violation by the Employee of Section 11 or
    Section 12 hereof, any severance being paid or provided to
    the Employee pursuant to this Agreement or otherwise shall
    immediately cease, and any severance previously paid to the
    Employee shall be immediately repaid to the Company.



 



    14.  NO ASSIGNMENTS. This Agreement is personal
    to each of the parties hereto. Except as provided in this
    Section 14 hereof, no party may assign or delegate any
    rights or obligations hereunder without first obtaining the
    written consent of the other party hereto. The Employee hereby
    acknowledges and agree that the Company may assign this
    Agreement (including the provisions of Section 11 and
    Section 12) to any successor to all or substantially
    all of the business
    and/or
    assets of the Company. As used in this Agreement,
    “Company” shall mean the Company and any
    successor to its business
    and/or
    assets.



 



    15.  NOTICE. For purposes of this Agreement,
    notices and all other communications provided for in this
    Agreement shall be in writing. Each notice and all other
    communications shall be delivered either by hand, by confirmed
    facsimile or electronic mail (but only if followed by
    transmittal by national overnight courier or hand delivered in
    person on the next business day), by guaranteed overnight
    delivery service, or by United States registered or certified
    mail, return receipt requested, postage prepaid, addressed as
    follows:



 



    If to the Employee:



 



    At the address (or to the facsimile number) shown




    on the records of the Company



 



    If to the Company:



 



    Reunion Hospitality Trust, Inc.




    60 East 42nd Street




    Suite 1901




    New York, New York 10165




    Attention: Daniel B. Silvers, President




    Facsimile:
    (917) 591-4373



 



    and



 



    Reunion Hospitality Trust, Inc.




    1370 Avenue of the Americas, 28th Floor




    New York, New York 10019




    Attention: E. Jonathan Falik, Chief Executive Officer




    Facsimile:
    (212) 445-7801



 



    with a copy to:



 



    Proskauer Rose LLP




    1585 Broadway




    New York, New York
    10036-8299




    Attention: Jeffrey A. Horwitz, Esq.




    Facsimile:
    (212) 969-2900








 



    or to such other address as either party may have furnished to
    the other in writing in accordance herewith. Each notice and all
    other communications shall be deemed duly given and effective
    upon actual receipt (or refusal of receipt).



 



    16.  SECTION HEADINGS; INCONSISTENCY. The
    section headings used in this Agreement are included solely for
    convenience and shall not affect, or be used in connection with,
    the interpretation of this






    

    10








 







    Agreement. In the event of any inconsistency between the terms
    of this Agreement and any form, award, plan or policy of the
    Company, the terms of this Agreement shall govern and control.



 



    17.  SEVERABILITY. The provisions of this
    Agreement shall be deemed severable and the invalidity or
    unenforceability of any provision shall not affect the validity
    or enforceability of the other provisions hereof.



 



    18.  COUNTERPARTS. This Agreement may be
    executed in several counterparts, each of which shall be deemed
    to be an original but all of which together will constitute one
    and the same instrument.



 



    19.  GOVERNING LAW; CONSENT TO JURISDICTION; WAIVER
    OF JURY TRIAL. This Agreement shall be governed by and
    construed in accordance with the internal laws of the State of
    New York, without regard to its principles of conflicts of laws.
    Each of the Parties irrevocably submits to the exclusive
    jurisdiction of the courts of the State of New York located in
    New York City or the United States District Court for the
    Southern District of New York for the purpose of any suit,
    action, proceeding or judgment relating to or arising out of
    this Agreement and the transactions contemplated hereby. Service
    of process in connection with any such suit, action or
    proceeding may be served on each party hereto anywhere in the
    world by the same methods as are specified for the giving of
    notices under this Agreement. Each of the parties hereto
    irrevocably consents to the jurisdiction of any such court in
    any such suit, action or proceeding and to the laying of venue
    in such court. Each party hereto irrevocably waives any
    objection to the laying of venue of any such suit, action or
    proceeding brought in such courts and irrevocably waives any
    claim that any such suit, action or proceeding brought in any
    such court has been brought in an inconvenient forum. EACH OF
    THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY
    IN ANY LITIGATION WITH RESPECT TO THIS AGREEMENT AND REPRESENTS
    THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS WAIVER.



 



    20.  INDEMNIFICATION. The Company hereby agrees
    to indemnify the Employee and hold the Employee harmless to the
    extent provided under the By-Laws of the Company and the
    Indemnification Agreement, dated as of
    [          ],
    2010 between the Company and the Employee against and in respect
    of any and all actions, suits, proceedings, claims, demands,
    judgments, costs, expenses (including reasonable attorney’s
    fees), losses, and damages resulting from the Employee’s
    good faith performance of the Employee’s duties and
    obligations with the Company. This obligation shall survive the
    termination of the Employee’s employment with the Company.



 



    21.  LIABILITY INSURANCE. From and after the
    Effective Date, the Company shall cover the Employee under
    directors’ and officers’ liability insurance and
    professional liability insurance both during and, while
    potential liability exists, after the term of this Agreement in
    the same amount and to the same extent as the Company covers its
    other officers and directors.



 



    22.  MISCELLANEOUS. No provision of this
    Agreement may be modified, waived or discharged unless such
    waiver, modification or discharge is agreed to in writing and
    signed by the Employee and such officer or director as may be
    designated by the Board. No waiver by either party hereto at any
    time of any breach by the other party hereto of, or compliance
    with, any condition or provision of this Agreement to be
    performed by such other party shall be deemed a waiver of
    similar or dissimilar provisions or conditions at the same or at
    any prior or subsequent time. This Agreement together with all
    exhibits hereto sets forth the entire agreement of the parties
    hereto in respect of the subject matter contained herein and
    supersedes any and all prior agreements or understandings,
    written or oral, between the Employee and either the Company
    with respect to the subject matter hereof. No agreements or
    representations, oral or otherwise, express or implied, with
    respect to the subject matter hereof have been made by either
    party which are not expressly set forth in this Agreement.



 



    23.  REPRESENTATIONS. The Employee represents
    and warrants to the Company that (a) the Employee has the
    legal right to enter into this Agreement and to perform all of
    the obligations on the Employee’s part to be performed
    hereunder in accordance with its terms, and (b) the
    Employee is not a party to any agreement or understanding,
    written or oral, and is not subject to any restriction, which,
    in






    

    11








 







    either case, could prevent the Employee from entering into this
    Agreement or performing all of the Employee’s duties and
    obligations hereunder. In addition, the Employee acknowledges
    that the Employee is aware of Section 304 (Forfeiture of
    Certain Bonuses and Profits) of the Sarbanes-Oxley Act of 2002
    and the right of the Company to be reimbursed for certain
    payments to the Employee in compliance therewith. In addition,
    the Employee hereby represents, warrants and agrees with the
    Company that: (i) a portion of the compensation payable to
    the Employee pursuant to this Agreement constitutes good and
    valuable consideration, the receipt and sufficiency of which are
    hereby expressly acknowledged, for the covenants and agreements
    contained in Section 11 and Section 12; (ii) the
    covenants and agreements contained in Section 11 and
    Section 12 are reasonable, appropriate and suitable in
    their geographic scope, duration and content; the Employee shall
    not, directly or indirectly, raise any issue of the
    reasonableness, appropriateness and suitability of the
    geographic scope, duration or content of such covenants and
    agreements in any proceeding to enforce such covenants and
    agreements; and such covenants and agreements shall survive the
    termination of the Employees employment for the durations set
    forth therein; (iii) the enforcement of any remedy under
    this Agreement will not prevent the Employee from earning a
    livelihood because the Employee’s past work history and
    abilities are such that the Employee reasonably can expect to
    find work, if he so chooses, in other areas and lines of
    business; (iv) the covenants and agreements stated in
    Section 11 and Section 12 are essential for the
    Employer’s reasonable protection; and (v) the Company
    has reasonably relied on these covenants and agreements by the
    Employee.



 


		
	
    24.  
	
    TAX
    MATTERS.




 



    (a) WITHHOLDING. The Employee shall pay, or make
    arrangements satisfactory to the Company to pay, in a manner
    satisfactory to the Company, an amount equal to the amount of
    all applicable federal, state and local taxes (but not the
    Company’ share of Social Security taxes) that the Company
    is required to withhold at any time. In the absence of such
    arrangements, the Company may withhold from any and all amounts
    payable under this Agreement such federal, state and local taxes
    as may be required to be withheld pursuant to any applicable law
    or regulation.



 



    (b) SECTION 409A COMPLIANCE.



 



    (i) The parties agree that this Agreement shall be interpreted
    to comply with Code Section 409A of the Internal Revenue
    Code of 1986, as amended (the “Code”) and the
    regulations and guidance promulgated thereunder to the extent
    applicable (collectively “Code
    Section 409A”) and all provisions of this
    Agreement shall be construed in a manner consistent with the
    requirements for avoiding taxes or penalties under Code Section
    409A. In no event will the Company be liable for any additional
    tax, interest or penalties that may be imposed on the Employee
    by Code Section 409A or any damages for failing to comply
    with Code Section 409A or the provisions of this
    Section 24.



 



    (ii) Notwithstanding any provision to the contrary in this
    Agreement, a termination of the Employee’s employment shall
    not be deemed to have occurred for purposes of any provision of
    this Agreement providing for the payment of any amounts or
    benefits upon or following a termination of employment unless
    such termination is also a “separation from service”
    (within the meaning of Code Section 409A) and, for purposes
    of any such provision of this Agreement, references to a
    “termination” or “termination of employment”
    will mean separation from service. If the Employee is deemed on
    the date of termination of his employment to be a
    “specified employee”, within the meaning of that term
    under Section 409A(a)(2)(B) of the Code and using the
    identification methodology selected by the Company from time to
    time, or if none, the default methodology set forth in Code
    Section 409A, then with regard to any payment or the
    providing of any benefit that constitutes “non-qualified
    deferred compensation” pursuant to Code Section 409A,
    such payment or benefit will not be made or provided prior to
    the earlier of (i) the expiration of the six-month period
    measured from the date of the Employees separation from service
    or (ii) the date of the Employee’s death. On the first
    day of the seventh month following the date of the
    Employee’s separation from service or, if earlier, on the
    date of the Employee’s death, all payments delayed pursuant
    to this Section (whether they would have otherwise been payable
    in a single sum or in installments in the absence of such






    

    12








 







    delay) will be paid or reimbursed to the Employee in a lump sum,
    and any remaining payments and benefits due under this Agreement
    will be paid or provided in accordance with the normal payment
    dates specified for them herein.



 



    (iii) Any reimbursement of costs and expenses provided for under
    this Agreement shall be made no later than December 31 of the
    calendar year next following the calendar year in which the
    expenses to be reimbursed are incurred.



 



    (iv) With regard to any provision herein that provides for
    reimbursement of expenses or in-kind benefits, except as
    permitted by Code Section 409A, (i) the right to
    reimbursement or in-kind benefits is not subject to liquidation
    or exchange for another benefit, and (ii) the amount of
    expenses eligible for reimbursement, or in-kind benefits,
    provided during any taxable year shall not affect the expenses
    eligible for reimbursement, or in-kind benefits to be provided,
    in any other taxable year, provided, that the foregoing
    clause (ii) shall not be violated with regard to expenses
    reimbursed under any arrangement covered by Code
    Section 105(b) solely because such expenses are subject to
    a limit related to the period the arrangement is in effect.



 



    (v) With regard to any installment payments provided for herein,
    each installment thereof shall be deemed a separate payment for
    purposes of Code Section 409A.



 



    (vi) Whenever a payment under this Agreement specifies a payment
    period with reference to a number of days, the actual date of
    payment within the specified period shall be within the sole
    discretion of the Company.



 



    (vii) To the extent that this Agreement provides for the
    Employee’s indemnification by the Company
    and/or the
    payment or advancement of costs and expenses associated with
    indemnification, any such amounts shall be paid or advanced to
    the Employee only in a manner and to the extent that such
    amounts are exempt from the application of Code
    Section 409A in accordance with the provisions of Treasury
    Regulation 1.409A-1(b)(10).



 



    25.  WAIVER. The Employee hereby acknowledges
    that the Escrow Proceeds will be placed in an escrow account
    (the “Escrow Account”). The Employee hereby
    waives any claim of any kind in or to any monies in the Escrow
    Account established by the Company (the
    “Claim”) that the Employee may have in the
    future as a result of, or arising out of, any negotiations,
    contracts or agreements with the Company and will not seek
    recourse against the Escrow Account for any reason whatsoever.



 




    [REMAINDER
    OF PAGE INTENTIONALLY LEFT BLANK]
    





    

    13








 







    IN WITNESS WHEREOF, the parties hereto have executed this
    Agreement as of the date first written above.



 



    REUNION HOSPITALITY TRUST, INC.



 


			
	 	    By: 
	
        









    Name:     E. Jonathan Falik



			
	 	    Title: 
	
    Chief Executive Officer




 











    Jason N. Ader





    

    14