Document:

exv10w19

 

Exhibit 10.19

SECOND AMENDMENT

     This SECOND AMENDMENT to the EXECUTIVE EMPLOYMENT AGREEMENT effective as of
November 1, 2001, (“Employment Agreement’’), by and among MeriStar Hospitality
Corporation (the “Company”, and MeriStar Hospitality Operating Partnership,
L.P. (the “Partnership”), and Paul W. Whetsell (the “Executive”), is hereby
entered into on this 22nd day of April 2003 by and among the parties.

     For good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged by the Executive, the Company, and the Partnership, the
parties each agree to amend the Employment Agreement as follows:

     Section 4(d)(ii) of the Employment Agreement is hereby deleted and replaced, in
its entirety as follows:

"(ii)  The Executive shall be granted annually, on May 1 2002, 2003 and 2004,
pursuant to either the Company’s Profits-Only Operating Partnership Units
(“POPs”) Plan or the Company’s Incentive Plan, a minimum of 75,000 POPs or
shares of restricted Common Stock (“Restricted Stock”) and a maximum of 225,000
POPs or Restricted Stock as determined by the Board. The POPs or Restricted
Stock shall vest equally on the first, second and third anniversaries of the
date of grant. Annual POPs or Restricted Stock grants thereafter shall be at
the discretion of the Board. The Company or the Partnership will pay the
executive a distribution on each POP, which such POPs are outstanding, equal
to, and at the same time as, distributions made to common operating partnership
units of the Partnership. The Company or the Partnership will pay the Executive
a dividend on each share of Restricted Stock equal to, and at the same time as,
dividends are paid to holders of the Company’s Common Stock.”

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

	 	 	 	 	 
	EXECUTIVE	 	MERISTAR HOSPITALITY CORPORATION, INC.
	 
	By:	  /s/ Paul W. Whetsell	 	By:	/s/ Jerome J. Kraisinger
	 	
	 	 	

	 	Paul W. Whetsell	 	 	Name: Jerome J. Kraisinger
	 	 	 	Title: Executive
Vice President and General Counsel 

 
	 	 	 

	 	 
	MERISTAR HOSPITALITY OPERATING PARTNERSHIP,
      L.P.

      By: Meristar Hospitality Corporation, its general partner
	 
	By:	/s/ Jerome J. Kraisinger
	 	

	 	Name: Jerome J. Kraisinger

      Title: Executive Vice President and General Counselexv10w20

 

Exhibit 10.20

EXECUTIVE EMPLOYMENT AGREEMENT

EXECUTIVE EMPLOYMENT AGREEMENT, effective as of February 17, 2003 by and
between MERISTAR HOSPITALITY CORPORATION, a Maryland corporation (the
“Company”), MERISTAR HOSPITALITY OPERATING PARTNERSHIP, L.P., a Delaware
limited partnership (the “Partnership”), and Jerome J. Kraisinger (the
“Executive”), an individual residing at 9609 Barroll Lane, Kensington, MD
20895-3504.

     The Company and the Partnership desire to employ the Executive in the
capacity of Executive Vice President, General Counsel, and Corporate Secretary
and the Executive desires to be so employed, on the terms and subject to the
conditions set forth in this agreement (the “Agreement”);

     Now, therefore, in consideration of the mutual covenants set forth herein
and other good and valuable consideration the parties hereto hereby agree as
follows:

     1.     Employment Term. The Company and the Partnership each hereby employ
the Executive, and the Executive agrees to be employed by the Company and the
Partnership, upon the terms and subject to the conditions set forth herein, for
a term of three (3) years, commencing on February 17, 2003 (the “Commencement
Date”), unless terminated earlier in accordance with Section 4 of this
Agreement; provided that such term shall automatically be extended from time to
time for additional periods of one calendar year from the date on which it
would otherwise expire unless the Executive, on one hand, or the Company and
the Partnership, on the other, gives notice to the other party or parties prior
to such date that it elects to permit the term of this Agreement to expire
without extension on such date. (The initial term of this Agreement as the
same may be extended in accordance with the terms of this Agreement is
hereinafter referred to as the “Term”).

     2.     Positions: Conduct.

             (a) During the Term, the Executive will hold the title and office of, and
serve in the position of, Executive Vice President, General Counsel, and
Corporate Secretary of the Company and the Partnership. The Executive shall
undertake the responsibilities and exercise the authority customarily
performed, undertaken and exercised by persons situated in similar executive
capacity, and shall perform such other specific duties and services (including
service as an officer, director or equivalent position of any direct or
indirect subsidiary without additional compensation) as they shall reasonably
request consistent with the Executive’s position.

             (b) During the Term, the Executive agrees to devote his full business time
and attention to the business and affairs of the Company and the Partnership
and to faithfully and diligently perform, to the best of his ability, all of
his duties and responsibilities hereunder. Nothing in this Agreement shall
preclude the Executive from devoting reasonable time and attention to (i)
serving, with the approval of

 

 

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the Board, as a director, trustee or member of any committee of any
organization, (ii) engaging in charitable and community activities and (iii)
managing his personal investments and affairs; provided that such activities do
not involve any material conflict of interest with the interests of the Company
or, individually or collectively, interfere materially with the performance by
the Executive of his duties and responsibilities under this Agreement.
Notwithstanding the foregoing and except as expressly provided herein, during
the Term, the Executive may not accept employment with any other individual or
entity, or engage in any other venture which is directly or indirectly in
conflict or competition with the business of the Company or the Partnership.

             (c) The Executive’s office and place of rendering his services under this
Agreement shall be in the principal executive offices of the Company which
shall be in the Washington, D.C. metropolitan area. Under no circumstances
shall the Executive be required to relocate from the Washington, D.C.
metropolitan area or provide services under this Agreement in any other
location other than in connection with reasonable and customary business
travel. During the Term, the Company shall provide the Executive with
executive office space, and administrative and secretarial assistance and other
support services consistent with his position as Executive Vice President,
General Counsel, and Corporate Secretary and with his duties and
responsibilities hereunder.

     3.     Salary; Additional Compensation; Perquisites and Benefits.

             (a) During the Term, the Company and the Partnership will pay the
Executive a base salary at an aggregate annual rate of not less than $210,000
per annum, subject to annual review by the Compensation Committee of the Board
(the “Compensation Committee”), and in the discretion of such Committee,
increased from time to time. Such salary shall be paid in periodic
installments in accordance with the Company’s standard practice, but not less
frequently than semi-monthly.

             (b) For each fiscal year during the Term, the Executive will be eligible
to receive a bonus from the Company. The award and amount of such bonus shall
be based upon the achievement of predefined operating or performance goals and
other criteria established by the Compensation Committee, which goals shall
give the Executive the opportunity to earn a bonus in the following amounts:
threshold target — 25% of base salary; internal plan: 50% of base salary;
target — 75% of base salary; and maximum bonus amount — 100% of base salary.

             (c) During the Term, the Executive will participate in all plans now
existing or hereafter adopted by the Company or the Partnership for their
management employees or the general benefit of their employees, such as any
pension, profit-sharing, bonuses, stock option or other incentive compensation
plans, life and health insurance plans, or other insurance plans and benefits
on the same basis and subject to the same qualifications as other senior
executive officers.

             (d)(1) The Executive shall be eligible for stock option grants from time
to time pursuant to the Company’s Incentive Plan in accordance with the terms
thereof. The Compensation Committee has granted to the executive, effective on
the

 

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commencement date, options to purchase 50,000 shares of the common stock of the
company at an exercise price equal to the fair market value on the commencement
date. Such options shall vest over three years as follows:

	 	 	 	 	 
	 	 	
First Anniversary of the Commencement Date
	 	33-1/3%
	 	 	 	 	 
	 	 	
Vested Second Anniversary of the
Commencement Date
	 	66-2/3%
	 	 	 	 	 
	 	 	
Vested Third Anniversary of the
Commencement Date
	 	100% vested

Such options shall be exercisable, vest and in all other respects shall be
subject to the terms and conditions of the incentive plan.

     (2)  On the Commencement Date the Company shall issue to the executive
15,000 shares of the Company’s common stock (the “Restricted Common Stock”).
Subject to the Executive’s continued employment [and the other terms of the
Company’s Restricted Stock Plan] the Restricted Common Stock shall vest over
three years as follows:

	 	 	 	 	 
	 	 	
First Anniversary of the Commencement Date
	 	33-1/3%
	 	 	 	 	 
	 	 	
Vested Second Anniversary of the
Commencement Date
	 	66-2/3%
	 	 	 	 	 
	 	 	
Vested Third Anniversary of the
Commencement Date
	 	100% vested

[The Restricted Stock shall in all other respects be governed by the terms of
the Company’s Restricted Stock Plan]

             (e) The Company and the Partnership will reimburse the Executive, in
accordance with their standard policies from time to time in effect, for all
out-of-pocket business expenses as may be incurred by the Executive in the
performance of his duties under this Agreement.

             (f) The Executive shall be entitled to vacation time to be credited and
taken in accordance with the Company’s policy from time to time in effect for
senior executives, which in any event shall not be less than a total of four
weeks per calendar year. Such vacation time shall not be carried over year to
year, and shall not be paid out upon termination of employment, or upon
expiration of this Agreement.

 

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             (g) To the fullest extent permitted by applicable law, the Executive shall
be indemnified and held harmless by the Company and the Partnership against any
and all judgments, penalties, fines, amounts paid in settlement, and other
reasonable expenses (including, without limitation, reasonable attorneys’ fees
and disbursements) actually incurred by the Executive in connection with any
threatened, pending or completed action, suit or proceeding (whether civil,
criminal, administrative, investigative or other) for any action or omission in
his capacity as a director, officer or employee of the Company or the
Partnership.

     Indemnification under this Section 3(g) shall be in addition to, and not
in substitution of, any other indemnification by the Company or the Partnership
of its officers and directors. Expenses incurred by the Executive in defending
an action, suit or proceeding for which he claims the right to be indemnified
pursuant to this Section 3(g) shall be paid by the Company or the Partnership,
as the case may be, in advance of the final disposition of such action, suit or
proceeding upon the Company’s or the Partnership’s receipt of (x) a written
affirmation by the Executive of his good faith belief that the standard of
conduct necessary for his indemnification hereunder and under the provisions of
applicable law has been met and (y) a written undertaking by or on behalf of
the Executive to repay the amount advanced if it shall ultimately be determined
by a court that the Executive engaged in conduct which precludes
indemnification under the provisions of such applicable law. Such written
undertaking in clause (y) shall be accepted by the Company or the Partnership,
as the case may be, without security therefor and without reference to the
financial ability of the Executive to make repayment thereunder. The Company
and the Partnership shall use commercially reasonable efforts to maintain in
effect for the Term of this Agreement a directors’ and officers’ liability
insurance policy, with a policy limit of at least $5,000,000, subject to
customary exclusions, with respect to claims made against officers and
directors of the Company or the Partnership; provided, however, the Company or
the Partnership, as the case may be, shall be relieved of this obligation to
maintain directors’ and officers’ liability insurance if, in the good faith
judgment of the Company or the Partnership, it cannot be obtained at a
reasonable cost.

     4.     Termination.

             (a) The Term will terminate immediately upon the Executive’s death or,
upon thirty (30) days’ prior written notice by the Company, in the case of a
determination of the Executive’s Disability. As used herein the term
“Disability” means the Executive’s inability to perform his duties and
responsibilities under this Agreement for a period of more than 120 consecutive
days, or for more than 180 days, whether or not continuous, during any 365-day
period, due to physical or mental incapacity or impairment. A determination of
Disability will be made by a physician reasonably satisfactory to both the
Executive and the Company and paid for by the Company or the Partnership whose
decision shall be final and binding on the Executive and the Company;
provided
that if they cannot agree as to a physician, then each shall select and pay for
a physician and these two together shall select a third physician whose fee
shall be borne equally by the Executive and either the Company or the
Partnership and whose determination of Disability shall be binding on the
Executive and the Company.

 

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     Notwithstanding the foregoing, the Executive shall not be considered “Disabled”
unless he qualifies for disability benefits under the terms and conditions of
the Company’s then existing long-term disability plan. Should the Executive
become incapacitated, his employment shall continue and all base and other
compensation due the Executive hereunder shall continue to be paid through the
date upon which the Executive’s employment is terminated for Disability in
accordance with this section.

             (b) The Term may be terminated by the Company upon notice to the Executive
upon the occurrence of any event constituting “Cause” as defined herein.

             (c) The Term may be terminated by the Executive upon notice to the Company
of any event constituting “Good Reason” as defined herein.

     5.     Severance.

             (a) If the Term is terminated by the Company for Cause,

	 	(i)	 	the Company and the
Partnership will pay to the Executive an
aggregate amount equal to the Executive’s
accrued and unpaid base salary through the date
of such termination;
	 
	 	(ii)	 	all unvested options
and unvested restricted shares will terminate
immediately; and
	 
	 	(iii)	 	any vested options
issued pursuant to the Company’s Incentive Plan
and held by the Executive at termination, will
expire ninety (90) days after the termination
date.

             (b) If the Term is terminated by the Executive other than because of
death, Disability or for Good Reason,

	 	(i)	 	the Company and the
Partnership will pay to the Executive an
aggregate amount equal to the Executive’s
accrued and unpaid base salary through the date
of such termination;
	 
	 	(ii)	 	all unvested options
and unvested restricted shares terminate
immediately; and
	 
	 	(iii)	 	any vested options
issued pursuant to the Company’s Incentive Plan
and held by the Executive at termination, will
expire ninety (90) days after the termination
date.

             (c) If the Term is terminated upon the Executive’s death or Disability,

 

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	 	(i)	 	the Company and the
Partnership will pay to the Executive’s estate
or the Executive, as the case may be, a lump sum
payment equal to the Executive’s base salary
through the termination date, plus a pro rata
portion of the Executive’s bonus for the fiscal
year in which the termination occurred;
	 
	 	(ii)	 	the Company will make
payments for one (1) year of all compensation
otherwise payable to the Executive pursuant to
this Agreement, including, but not limited to,
base salary, bonus and welfare benefits; and
	 
	 	(iii)	 	all of the
Executive’s unvested stock options will
immediately vest and such options, along with
those previously vested and unexercised, will
become exercisable for a period of one (1) year
thereafter.

             (d) Subject to Section 5(e) hereof, if the Term is terminated by the
Company without Cause or other than by reason of Executive’s death or
Disability, in addition to any other remedies available, or if the Executive
terminates the Term for Good Reason,

	 	(i)	 	the Company and the
Partnership shall pay the Executive a lump sum
equal to the product of (x) one (1) times the
sum of (A) the Executive’s then annual base
salary and (B) the amount of the Executive’s
bonus for the preceding year, or in the case of
the initial year of the Executive’s employment,
the bonus amount will be $157,500;
	 
	 	(ii)	 	all of the
Executive’s unvested stock options will
immediately vest and such options, along with
those previously vested, will become exercisable
for a period of one (1) year thereafter; and
	 
	 	(iii)	 	and the Company
shall continue in effect the Executive’s health
insurance benefits until the earlier of (x) one
(1) year from the end of the term or (y) the
date on which the Executive obtains health
insurance coverage from a subsequent employer.

             (e) If, within eighteen (18) months following a Change in Control, the
Term is terminated by the Executive for Good Reason, or by the Company without
Cause, or if the Agreement is not renewed by the Company in accordance with
Section 1, in addition to any other rights which the Executive may have under
law or otherwise, the Executive shall receive the same payments and benefits
provided for under

 

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Section 5(d) hereof;
provided, that the amount of the multiplier described in
clause (d) of Section 5 hereof shall be increased from one times to one and
one-half (1 1/2) times.

             (f) If at any time the Term is not extended pursuant to the proviso to
Section 1 hereof as a result of the Company giving notice thereunder that it
elects to permit the term of this Agreement to expire without extension, the
Company shall be deemed to have terminated the Executive’s employment without
Cause.

             (g) As used herein, the term “Cause” means:

		
	 	     (i) the Executive’s willful and intentional failure or refusal to
perform or observe any of his material duties, responsibilities or
obligations set forth in this Agreement; provided, however, that the
Company shall not be deemed to have Cause pursuant to this clause (i)
unless the Company gives the Executive written notice that the specified
conduct has occurred and making specific reference to this Section
5(g)(i) and the Executive fails to cure the conduct within thirty (30)
days after receipt of such notice;

		
	 	     (ii) any willful and intentional act of the Executive involving
malfeasance, fraud, theft, misappropriation of funds, embezzlement or
dishonesty affecting the Company or the Partnership; or

		
	 	     (iii) the Executive’s conviction of, or a plea of guilty or nolo
contendere to, an offense which is a felony in the jurisdiction involved.

		
	 	     (iv) 
Executive’s material breach of this Agreement; or

		
	 	     (vi) Gross misconduct by Executive that is of such a serious or
substantial nature that a substantial likelihood exists that such
misconduct would injure the reputation of the Company if the Executive
were to remain employed by the Company or the Partnership.

Termination of the Executive for Cause shall be communicated by a Notice of
Termination. For purposes of this Agreement, a “Notice of Termination” shall
mean delivery to the Executive of a copy of a resolution duly adopted by the
affirmative vote of not less than a majority of the entire membership of the
Company’s Board at a meeting of the Board called and held for the purpose
(after reasonable notice to the Executive and reasonable opportunity for the
Executive, together with the Executive’s counsel, to be heard before the Board
prior to such vote) of finding that in the good faith opinion of the Board, the
Executive was guilty of conduct constituting Cause and specifying the
particulars thereof in detail, including, with respect to any termination based
upon conduct described in clause (i) above that the Executive failed to cure
such conduct during the thirty-day period following the date on which the
Company gave written notice of the conduct referred to in such clause (i). For
purposes of this Agreement, no such purported termination of the Executive’s
employment shall be effective without such Notice of Termination;

 

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             (h) As used herein, the term “Good Reason” means the occurrence of any of
the following, without the prior written consent of the Executive:

		
	 	     (i) assignment of the Executive of duties materially inconsistent
with the Executive’s positions as described in Section 2(a) hereof, or
any significant diminution in the Executive’s duties or responsibilities,
other than in connection with the termination of the Executive’s
employment for Cause, Disability or as a result of the Executive’s death
or by the Executive other than for Good Reason;

		
	 	     (ii) the change in the location of the Company’s principal executive
offices or of the Executive’s principal place of employment to a location
outside the Washington, D.C. metropolitan area;

		
	 	     (iii) any material breach of this Agreement by the Company or the
Partnership which is continuing; or

		
	 	     (iv) a Change in Control; provided that a Change of Control shall
only constitute Good Reason if (a) the Company terminates the Executive
within eighteen months following a Change of Control or (b) the Company
changes the Executive’s job title, responsibilities or decreases
Executive’s compensation within eighteen months following a Change of
Control and Executive within six months after such change (but not later
than eighteen months following the Change of Control) terminates his
employment;

provided, however, that the Executive shall not be deemed to have Good Reason
pursuant to clauses (ii) and (iii) above unless the Executive gives the Company
or the Partnership, as the case may be, written notice that the specified
conduct or event has occurred and the Company or the Partnership fails to cure
such conduct or event within thirty (30) days of the receipt of such notice.
Change of Control will not be deemed “Good Reason,” however, if the Executive
maintains the same title, job responsibilities and compensation following a
Change of Control.

             (i) As used herein, the term “Change in Control” means the occurrence of
any one of the following events:

		
	 	     (i) the acquisition (other than from the Company) by any “Person”
(as the term is used for purposes of Sections 13(d) or 14(d) of the
Exchange Act) of beneficial ownership (within the meaning of Rule 13d-3
promulgated under the Exchange Act) of fifty (50%) percent or more of the
combined voting power of the Company’s then outstanding voting
securities; or

		
	 	     (ii) the individuals who were members of the Board (the “Incumbent
Board”) during the previous twelve (12) month period, cease for any
reason to constitute at least a majority of the Board;
provided, however,
that if the election, or nomination for election by the Company’s
stockholders, of any new director was approved by a vote of at least
two-thirds of the Incumbent Board,

 

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	 	such new director shall, for purposes of this Agreement, be considered as
a member of the Incumbent Board;

		
	 	     (iii) approval by the stockholders of the Company of (a) merger,
transaction (including without limitation a “going private transaction”),
or consolidation involving the Company if the stockholders of the
Company, immediately before such merger or consolidation do not, as a
result of such merger or consolidation, own, directly or indirectly, more
than fifty (50%) percent of the combined voting power of the then
outstanding voting securities of the corporation resulting from such
merger or consolidation in substantially the same proportion as their
ownership of the combined voting power of the voting securities of the
Company outstanding immediately before such merger or consolidation or
(b) a complete liquidation or dissolution of the Company or an agreement
for the sale or other disposition of all or substantially all of the
assets of the Company; or

     Notwithstanding the foregoing, a Change in Control shall not be deemed to
occur pursuant to clause (i) above solely because fifty (50%) percent or more
of the combined voting power of the Company’s then outstanding securities is
acquired by (a) a trustee or other fiduciary holding securities under one or
more employee benefit plans maintained by the Company or any of its
subsidiaries or (b) any corporation which, immediately prior to such
acquisition, is owned directly or indirectly by the stockholders of the Company
in the same proportion as their ownership of stock in the Company immediately
prior to such acquisition.

     (j)  The amounts required to be paid and the benefits required to be made
available to the Executive under this Section 5 are absolute. Under no
circumstances shall the Executive, upon the termination of his employment
hereunder, be required to seek alternative employment and, in the event that
the Executive does secure other employment, no compensation or other benefits
received in respect of such employment shall be set-off or in any other way
limit or reduce the obligations of the Company under this Section 5.

     (k)  Notwithstanding the previous provisions, if payments made pursuant to
this Section 5 are considered “parachute payments” under Section 280G of the
Internal Revenue Code of 1986, then the sum of such parachute payments plus any
other payments made by the Company to the Executive which are considered
parachute payments shall be limited to the greatest amount which may be paid to
the Executive under Section 280G without causing any loss of deduction to the
Company under such section; but only if, by reason of such reduction, the net
after tax benefit of Executive shall exceed the net after tax benefit if such
reduction were not made. “Net after tax benefit” for purposes of this
Agreement shall mean the sum of (i) the total amounts payable to Executive
under Section 5, plus (ii) all other payments and benefits which the Executive
receives or is then entitled to receive from the Company that would constitute
a “parachute payment” which the meaning of Section 280G of the Code, less (iii)
the amount of federal income taxes payable with respect to the foregoing shall
be paid to Executive (based upon the rate in effect for such years as set forth
in the Code at the time

 

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of termination of Executive’s employment), less (iv) the amount of excise taxes
imposed with respect to the payments and benefits described in (i) and (ii)
above by Section 4999 of the Code.

     6.     Confidential Information and Covenants.

             (a) The Executive acknowledges that the Company and its subsidiaries or
affiliated ventures (“Company Affiliates”) own and have developed and compiled,
and will in the future own, develop and compile, certain Confidential
Information and that during the course of his rendering services hereunder
Confidential Information will be disclosed to the Executive by the Company
Affiliates. The Executive hereby agrees that, during the Term and for a period
of three years thereafter, he will not use or disclose, furnish or make
accessible to anyone, directly or indirectly, any Confidential Information of
the Company Affiliates. In particular, Executive covenants and agrees that
Executive shall not, directly or indirectly, communicate or divulge, or use for
the benefit of Executive or for any other person, or to the disadvantage of the
Company, the Confidential Information or any information in any way relating to
the Confidential Information, without prior written consent from the Company.

             (b) As used herein, the term “Confidential Information” means any trade
secrets, confidential or proprietary information, or other knowledge, know-how,
information, documents, materials, owned, developed or possessed by a Company
Affiliate pertaining to its businesses, including, but not limited to, records,
memoranda, computer files and disks, audio and video tapes, CD’s, and property
in any form containing information generally not known in the hospitality
industry, including but not limited to trade secrets, techniques, know-how
(including designs, plans, procedures, processes and research records),
operations, market structure, formulas, data, programs, licenses, prices,
costs, software, computer programs, innovations, discoveries, improvements,
research, developments, test results, reports, specifications, data, formats,
marketing data and business plans and strategies, customer lists, client lists
and client contact lists, agreements and other forms of documents, expansion
plans, budgets, projections, and salary, staffing and employment information.
Notwithstanding the foregoing, Confidential Information shall not in any event
include information which (i) was generally known or generally available to the
public prior to its disclosure to the Executive, (ii) becomes generally known
or generally available to the public subsequent to its disclosure to the
Executive through no wrongful act of the Executive, (iii) is or becomes
available to the Executive from sources other than the Company Affiliates which
sources are not known to the Executive to be under any duty of confidentiality
with respect thereto or (iv) the Executive is required to disclose by
applicable law or regulation or by order of any court or federal, state or
local regulatory or administrative body (provided that the Executive provides
the Company with prior notice of the contemplated disclosure and reasonably
cooperates with the Company, at the Company’s sole expense, in seeking a
protective order or other appropriate protection of such information).

             (c) Upon demand by the Company and/or upon termination of employment with
the Company for any reason, Executive shall promptly deliver to the Company all
property and materials, whether written, descriptive, or maintained in some

 

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other form belonging to or relating to the Company, its business affairs and
those of its Affiliates, including all Confidential Information. If Executive
desires to retain copies of any forms or other materials developed by Executive
during his employment with the Company, he may request permission to do so from
the Chief Executive Officer, which permission shall not be unreasonably
withheld.

             (d) The Executive agrees that during his employment hereunder and for a
period of twelve months thereafter he will not solicit, raid, entice or induce
any person that then is or at any time during the twelve-month period prior to
the end of the Term was an employee of a Company Affiliate (other than a person
whose employment with such Company Affiliate has been terminated by such
Company Affiliate), to become employed by any person, firm or corporation.

             (e) The Executive agrees that during his employment
hereunder and for a period of twelve (12) months thereafter he will not solicit
or accept the business of, or assist any other person to solicit or accept the
business of, any persons or entities who were customers of the Company, as of,
or within one (1) year prior to, the Executive’s termination of employment, for
the purposes of providing products or services competitive with the products or
services of the Company or to cause such customers to reduce or end their
business with the Company.

             (f) The Company understands and acknowledges that the rules of
professional conduct for attorneys prohibit certain restrictions on the
practice of law, and agrees that restrictions stated in this section 6 are
enforceable only to the extent that the restrictions do not violate rules of
professional conduct to which Executive is subject.

     7.     Cooperation with Company. Following the termination of the Executive’s
employment for any reason, Executive shall fully cooperate with the Company in
all matters relating to the winding up of his pending work on behalf of the
Company including, but not limited to, any litigation in which the Company is
involved and the orderly transfer of any such pending work to other employees
of the Company as may be designated by the Company. The Company agrees to
reimburse the Executive for any out-of-pocket expense he incurs in performing
any work on behalf of the Company following the termination of his employment.

     8.     Specific Performance.

             (a) The Executive acknowledges that the services to be rendered by him
hereunder are of a special, unique, extraordinary and personal character and
that the Company Affiliates would sustain irreparable harm in the event of a
violation by the Executive of Section 6 hereof. Therefore, in addition to any
other remedies available, the Company shall be entitled to specific enforcement
and/or an injunction from any court of competent jurisdiction restraining the
Executive from committing or continuing any such violation of this Agreement
without proving actual damages or posting a bond or other security. Nothing
herein shall be construed as prohibiting the Company from pursuing any other
remedies available to it for such breach or threatened breach, including the
recovery of damages.

 

12

             (b) If any of the restrictions on activities of the Executive contained in
Section 6 hereof shall for any reason be held by a court of competent
jurisdiction to be excessively broad, such restrictions shall be construed so
as thereafter to be limited or reduced to be enforceable to the maximum extent
compatible with the applicable law as it shall then appear; it being understood
that by the execution of this Agreement the parties hereto regard such
restrictions as reasonable and compatible with their respective rights.

             (c) Notwithstanding anything in this Agreement to the contrary, in the
event that the Company fails to make any payment of any amounts or provide any
of the benefits to the Executive when due as called for under Section 5 of this
Agreement and such failure shall continue for twenty (20) days after notice
thereof from the Executive, all restrictions on the activities of the Executive
under Section 6 hereof shall be immediately and permanently terminated.

     9.     Withholding. The parties agree that all payments to be made to the
Executive by the Company pursuant to the Agreement shall be subject to all
applicable withholding obligations of such company.

     10.     Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed given and received when delivered personally, four
(4) days after being mailed if sent by registered or certified mail, postage
pre-paid, or by one (1) day after delivery if sent by air courier (for next-day
delivery) with evidence of receipt thereof or by facsimile with receipt
confirmed by the addressee. Such notices shall be addressed respectively:

	 	If to the Executive, to:

	 	Jerome J. Kraisinger

9609 Barroll Lane

Kensington, MD 20895-3504______________

	 	If to the Company or to the Partnership, to:

	 	MeriStar Hospitality Corporation

1010 Wisconsin Avenue, N.W.

Washington, D.C. 20007

Attention: Legal Department

or to any other address of which such party may have given notice to the other
parties in the manner specified above.

     11.     Miscellaneous.

             (a) This Agreement is a personal contract calling for the provision of
unique services by the Executive, and the Executive’s rights and obligations
hereunder may not be sold, transferred, assigned, pledged or hypothecated by
the Executive. The rights and obligations of the Company and the Partnership
hereunder will be binding

 

13

upon and run in favor of their respective successors and assigns. The Company
will not be deemed to have breached this Agreement if any obligations of the
Company to make payments to the Executive are satisfied by the Partnership.

             (b) This Agreement shall be governed by and construed and enforced in
accordance with the internal laws of the State of Delaware, without regard to
conflict of laws principles.

             (c) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT
OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT.

             (d) The headings of the various sections of this Agreement are for
convenience of reference only and shall not define or limit any of the terms or
provisions hereof.

             (e) The provisions of this Agreement which by their terms call for
performance subsequent to the expiration or termination of the Term shall
survive such expiration or termination.

             (f) The Company and the Partnership shall reimburse the Executive for all
costs incurred by the Executive in any proceeding for the successful
enforcement of the terms of this Agreement, including without limitation all
costs of investigation and reasonable attorneys fees and expenses.

             (g) This Agreement constitutes the entire agreement of the parties hereto
with respect to the subject matter hereof and supersedes all other prior
agreements and undertakings, both written and oral, among the parties with
respect to the subject matter hereof (including, without limitation, the offer
letter dated January 3, 2003), all of which shall be terminated on the
Commencement Date. In addition, the parties hereto hereby waive all rights
such party may have under all other prior agreements and undertakings, both
written and oral, among the parties hereto.

[SIGNATURE PAGE FOLLOWS]

 

14

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

	 	 	 	 
	 	 	
EXECUTIVE:
	 	 	 
	 	 	
-s- Jerome J. Kraisinger
	 	 	

	 	 	
Jerome J. Kraisinger
	 	 	 
	 	 	
COMPANY:
	 	 	 
	 	 	
MERISTAR HOSPITALITY CORPORATION
	 	 	 
	 	 	
By:	
-s- Paul W. Whetsell
	 	 	 	

	 	 	 	
Name: Paul W. Whetsell

Title: Chief Executive Officer
	 	 	 	 
	 	 	
PARTNERSHIP:
	 	 	 	 
	 	 	
MERISTAR HOSPITALITY OPERATING PARTNERSHIP, L.P.
	 	 	 	 
	 	 	
By:	
MERISTAR HOSPITALITY CORPORATION,

Its General Partner
	 	 	 	 
	 	 	
By:	
-s- Paul W. Whetsell
	 	 	 	

	 	 	 	
Name: Paul W. Whetsell

Title: Chief Executive Officer

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