**Exhibit 10.2**

 

**EMPLOYMENT AGREEMENT**

 

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

 

RECITALS:

 

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

 

The Employee is Chairman, President and Director of the Adviser.  He has, effective on the date hereof, alsobeen elected Chairman and President of the Trust.  The Trustees determined that it was desirableto provide for continuity and to assure the Trust that the services presentlybeing furnished to it by the Adviser would be furnished by the Employee withoutany cost or expense to the Trust in excess of that called for under the termsof the Advisory Agreement in the event of any termination of the Advisory Agreement.

 

AGREEMENTS:

 

NOW, THEREFORE, in consideration of the foregoing, and their mutualcovenants and agreements herein contained, the parties hereto do hereby agreeas follows:

 

1.                                       Employment

 

The Trust hereby employs Employee as the Chairman, Chief ExecutiveOfficer and President of the Trust, and Employee hereby accepts such employmentupon the terms and conditions hereinafter set forth.

 

2.                                       Term

 

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

 

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3.                                       Duties

 

(A)                              Employee shall devotesuch business time, attention and energies to the business of the Trust as heshall deem necessary to perform for the Trust all of the duties and servicesrequired of him hereunder and shall serve both diligently and to the best ofhis ability.  Employee further shallperform such other duties as he shall deem to be normally incident to thepositions of Chairman, Chief Executive Officer and President of the Trust.  In addition to his duties as Chairman, ChiefExecutive Officer and President, Employee shall perform or provide for the performanceof all of the duties and services set forth in Section 1 of the AdvisoryAgreement; provided, however, that so long as the Advisory Agreement shallremain in full force and effect, the Advisor shall perform the Advisory dutiesthereunder.

 

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

 

4.                                       Compensation

 

During the term of this Agreement, so long as the Adviser is performingits services and duties under the terms of the Advisory Agreement and beingpaid compensation in respect thereof, the Trust shall not pay to the Employeeany monetary consideration. In the event that at any time during the termhereof the Adviser shall cease to serve the Trust as its Adviser under theterms of the Advisory Agreement and to receive compensation therefor(regardless of the reason for such cessation), then and thereafter during theremaining term of this Agreement the Employee shall receive as compensation infull for all of his services hereunder an amount equal to one hundred percent(100%) of the Regular Compensation and the Incentive Compensation that wouldhave been paid to the Adviser in respect of such period pursuant to Sections 9,10 and11(a) of the Advisory Agreement; and bear all expenses and pay all costs andcharges of the kind or nature that would have been paid or borne by the Adviserprior to the termination of the Advisory Agreement.

 

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

 

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

 

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5.                                       Termination

 

At the option of the Trust, this Agreement may be terminatedimmediately upon written notice of termination from the Trust to Employee ifany of the following events shall occur:

 

(i)                                     If Employeematerially shall violate any provision of this Agreement and, after writtennotice of such violation, shall not cure such default within thirty (30) days(provided, however, that if Employee shall not be reasonably able to cure suchdefault within such thirty (30) day period, if Employee shall not havecommenced promptly to cure such default and diligently pursued the same tocompletion); or

 

(ii)                                  If Employee shalldie; or

 

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

 

(iv)                              If Employee shall soconsent.

 

6.                                       CovenantAgainst Competition

 

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

 

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

 

(ii)                                  Either as anindividual for Employee’s own account or as an investor, or other participantin, or as an employee, agent or representative of, any other businessenterprise:

 

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

 

(b)                                 engage or participatein or finance, aid or be connected with, any commercial enterprise whichcompetes with any of the business activities which the Trust is conducting atsuch time.

 

The foregoing, however, shall not be deemed to prohibit the investmentwithout a role in management by Employee in the equity or debt securities ofany company otherwise within the ambit of this covenant and registered with theSecurities and Exchange Commission pursuant to Section 12 of theSecurities and Exchange Act of 1934.

 

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

 

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

 

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

 

Recognizing the irreparable nature of the injury that could result fromEmployee’s violation of any of the covenants and agreements to be performedand/or observed by Employee pursuant to the provisions of this Section 6,and that damages would be inadequate compensation, it is agreed that anyviolation by Employee of the provisions of this Section 6 shall be theproper subject for immediate injunctive and other equitable relief to theTrust.  Employee further agrees tocommunicate the contents of this Section 6 to any prospective employer orassociate of Employee which has an investment policy which is substantiallysimilar to that of the Trust.

 

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7.                                       GoverningLaw

 

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

 

8.                                       Assignment

 

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

 

9.                                       TheEntire Agreement

 

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

 

10.                                 Counterparts

 

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

 

11.                                 Notices

 

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

 

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12.                                 TheTrust

 

The name Realty ReFund Trust is the designation of the Trustees under aDeclaration of Trust dated April 28, 1971, as amended, and all personsdealing with Realty ReFund Trust must look solely to the Trust property for theenforcement of any claims against Realty ReFund Trust as neither the Trustees,officers, agents nor security holders assume any personal liabilities forcovenants or obligations entered into on behalf of Realty ReFund Trust andtheir respective properties shall not be subject to any claims of any otherperson in respect of such liability.

 

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

 
|   | REALTY ReFUND TRUST      |
|--------|--------------------------|
|   |                     |
|   |                     |
|   | By:                      |  /s/ Gregory D. Bruhn |   |
|   | Gregory D. Bruhn         |
|   | Executive Vice President |
|   | 1750 Huntington Building |
|   | 925 Euclid Avenue        |
|   | Cleveland, Ohio 44114    |
|   | Phone: (216) 622-0046    |
|   | Fax: (216) 622-1477      |
|   |                     |
|   | THE TRUST                |
|   |                     |
|   |                     |
|   | /s/ James F. Wirth       |   |
|   | James F. Wirth           |
|   | 1615 E. Northern Avenue  |
|   | Suite 105           |
|   | Phoenix, Arizona 85020   |
|   | Phone: (602) 944-1500    |
|   | Fax: (602) 678-0281      |
|   |                     |
|   | EMPLOYEE                 |

 

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