Document:

Release and Waiver Agreement between the Company and Tony (Miles) A. McIntosh

 Exhibit 10.1 
 McIntosh Separation Release 
 RELEASE AND WAIVER AGREEMENT 
 CONCERNING MY SEPARATION FROM EMPLOYMENT 
  

	1.	I, Tony (Miles) A. McIntosh, who resides at 1943 Red Oak Drive, Mansfield, OH 44904, have agreed to accept a Separation Benefit, upon my separation from employment with PECO II,
Inc. (the Company). 

  

	2.	I understand that, upon my signature, and that of a representative of the Company, this Agreement between the Company and me will govern the terms of my separation. I understand
that my employment will end effective January 31, 2008. 

  

	3.	I acknowledge that I have received all salary earned and accrued through the effective date of my separation. 

  

	4.	I understand that the Company is providing the Separation Benefit as a special benefit to me, in return for this Agreement. I understand that the Separation Benefit is over and
above what I would normally receive upon separation. It shall be paid in addition to unused earned vacation pay for the calendar year 2008. 

  

	5.	I understand that the Separation Benefit provided under this Agreement shall be: 

  

	 	a.	A gross payment equivalent to 28 weeks of pay - $59,230.77. 

  

	6.	I understand that my receipt of the Separation Benefit in no way affects any right I may have to receive continued medical coverage under COBRA (the Consolidated Omnibus Budget
Reconciliation Act). I further understand that the complete terms of my release and waiver agreement, and all the terms of my separation are contained in this single Agreement. I am relying on no information or representation concerning my
separation, other than the terms set out in this Agreement. 

  

	7.	I understand that under this Agreement the final date for exercising my stock options shall be July 31, 2008. 

  

	8.	I understand that under this Agreement the Company shall give consideration to utilizing me as a consultant for tasks that can benefit from my capabilities.

  

	9.	In consideration of the Separation Benefit, I waive and release any right that I may have to bring any claim, to litigate, or seek settlement, damages or liabilities regarding;
(1) my employment with the Company or any other entity affiliated with the Company; (2) termination of employment; (3) the Company’s offer of and my acceptance of the Separation Benefit (my “Waiver”) and;
(4) violation of any federal, state or local law, regulation, order or other requirement of law, breach of contract, commission of a civil wrong or otherwise by the Company. 

  

	10.	My Waiver shall apply to the Company, any parent corporation of the Company, their respective affiliates, successors, and assigns, and all of their past and present employees,
officers, agents, shareholders and directors, as well as all administrators, service providers, and fiduciaries (as the term fiduciary is defined under the Employee Retirement Income Security Act of 1974, as amended (ERISA), of any employee benefit
plan sponsored by such persons. None of these parties admits any liability or responsibility of any sort in connection with any matter described in this Agreement. 

  

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 McIntosh Separation Release 
  

	11.	I realize there are many laws and regulations prohibiting employment discrimination or otherwise regulating employment or claims related to employment pursuant to which I may have
rights or claims. My Waiver includes, but is not limited to claims arising under federal, state, or local laws prohibiting employment discrimination on the basis of age, race, color, national origin, gender, religion, disability, or veteran status,
including but not limited to claims arising under; (1) Title VII of the Civil Rights Act of 1964, as amended, including the Equal Employment Opportunity Act of 1972; (2) the Age Discrimination in Employment Act of 1967, as amended (the
“ADEA”); (3) the Americans with Disabilities Act of 1990; (4) the National Labor Relations Act, as amended; (5) the Employee Retirement Income Security Act of 1974, as amended (“ERISA”); (6) the Civil Rights
Act of 1991; (7) the Worker Adjustment and Retraining Notification Act of 1988; (8) the Family and Medical Leave Act; (9) 42 U.S.C. Section 1981; (10) the Older Workers Benefit Protection Act of 1990; as amended; and
(11) the Ohio Civil Rights Statute. My Waiver extends to all such claims, even if I do not currently know or believe that a claim exists. I intend to waive and release any rights I may have under these and other laws, and under laws of contract
and tort, but I do not intend to waive nor am I waiving (A) any rights or claims that may arise under the ADEA after the date that I sign this Agreement or (B) any claim that I may have under ERISA to a vested pension benefit or
(C) applicable workers compensation and unemployment benefit laws. 

  

	12.	I understand that the Company will provide me with twenty-one (21) calendar days to consider this Agreement, beginning with the date that I first received this Agreement.
During these twenty-one (21) days, I may consider whether or not to accept the Separation Benefit and to enter into this Agreement. I understand that although I may sign this Agreement before the twenty-one (21) calendar days have elapsed,
that I am under no obligation to do so. 

  

	13.	I understand that after signing this Agreement, and dating it as of my signature date, I shall have an additional seven (7) calendar days within which to revoke both this
signed Agreement and my agreement to accept the Separation Benefit. I understand that my acceptance of, and the Company’s obligation to provide the Separation Benefit shall therefore not become effective or enforceable until this seven
(7) calendar day period has passed. If I revoke this Agreement within this seven (7) calendar day period, I will give notice in writing to the Company, which I may do by mail and by fax, to the attention of Jocelyn Koozer, Director of
Human Resources. 

  

	14.	I reaffirm my agreement to comply with all prior agreements with, rules and policies of, the Company concerning proprietary, confidential and/or trade secret information of
the Company. I will hold all of the Company’s confidential information in strictest secrecy and confidence. I will not directly or indirectly, take, use or disclose (or enable anyone else to take, use or disclose) any of the Company’s
confidential information. The terms of this Agreement shall be deemed to be confidential between the parties hereto except when obligated by law. 

 The Company’s confidential information includes all trade secrets, proprietary and other information that was disclosed to or acquired by me during my employment that related to the business of the Company and is
not generally available to the public, or generally known to the Company’s competitors. Confidential information includes without limitation; customer lists, requirements for products and related customer information; suppliers identities and
products; bid and pricing information and product discount information pertaining to original equipment and spare parts. Confidential information also includes any techniques, processes, or combinations thereof, compilations of information, records
and specifications utilized or owned by the Company, development, marketing, business methods, strategies, policies or business opportunities. 
  

	15.	I understand the Company advises me to consult with an attorney, before I sign this Agreement. 

  

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 McIntosh Separation Release 
  

	16.	I acknowledge I have read this Agreement and that I have had an opportunity to question Company benefits personnel concerning the Separation Benefit that I will receive, following
my separation. I acknowledge that my decision to sign this Agreement is voluntary, and has been made without duress or coercion. I understand the financial and legal implications of my Waiver and my entering into this Agreement.

  

	17.	This Agreement shall be deemed to have been made within, and shall be interpreted, construed and enforced in accordance with the laws for the State of Ohio. This Agreement and my
Waiver are binding upon me, my successors, heirs and assigns. 

  

	18.	If one or more of the provisions or terms of this Agreement shall be ruled unenforceable, the Company may elect to enforce the remainder of this Agreement, or cancel it and get back
from me, my successors or assigns or otherwise, any consideration paid. 

 Signed by the parties on the dates indicated below. 
  

					
	  
	  		 	 /s/ Tony A. McIntosh

	Print Name – Tony (Miles) A. McIntosh	  		 	Signature
			
		  		 	 January 16, 2008

		  		 	Date of Signature

  

							
	State of Ohio	 	:	    		 	
		 		    	:    SS	 	
	County of Crawford	 	:	    		 	

 On this 16th day of January, 2008, before me, personally came Miles (Tony) A. McIntosh, known to me
to be the individual described in, and who executed the foregoing Release and Waiver and duly acknowledged to me he executed the same. 
 In witness whereof,
I hereunto set my hand and official seal. 
  

	
	 /s/ Cory S. Estes

	Notary Public

  

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 McIntosh Separation Release 
  
  

							
		 		 		 	PECO II, Inc.
				
	  
	 		 	By:	 	 /s/ John G. Heindel

	Print Name – John G. Heindel	 		 		 	Signature
				
		 		 		 	 President, C.E.O., and C.F.O.

		 		 		 	Title of Officer
				
		 		 		 	 January 16, 2008

		 		 		 	Date Accepted

  

 4EXHIBIT 10.5A

 Exhibit 10.5A 
 AMENDMENT NUMBER 2 TO HOTEL 
 MASTER MANAGEMENT AGREEMENT 
 THIS AMENDMENT NUMBER 2 (the “Amendment”) is made and entered into as of January 14, 2008 by and between MHI Hospitality
TRS, LLC, a Delaware limited liability company, as lessee, (hereinafter referred to as “Lessee”) and MHI Hotels Services LLC, a Virginia limited liability company, as manager (hereinafter referred to as “Manager”)
and amends and supplements that certain Hotel Master Management Agreement dated December 21, 2004 between Manager and Lessee, as amended through the date hereof (the “Master Agreement”). Lessee and Manager are sometimes
collectively referred to herein as the “Parties”. 
 WITNESSETH 
 WHEREAS, the Parties desire to amend the Master Agreement to modify certain provisions therein. 
 NOW THEREFORE, in consideration of the agreements contained herein, and intending to be legally bound hereby, the Parties agree as follows: 

Section 1. Section 8.2(e) of Article VIII is hereby deleted in its entirety and Sections 8.2(f) and 8.2(g) are redesignated as Sections 8.2(e) and
8.2(f), respectively. 
 Section 2. Article VIII of the Agreement is hereby amended by adding the following after Section 8.2: 

8.3 Major Repositionings and Product Improvement Plans. 
 In the event that Manager is engaged by Lessee to manage, coordinate, plan and execute a major repositioning or a Product Improvement Plan
for a Hotel, Manager shall be paid a project management fee (herein, the “Project Management Fee”) equal to five percent (5%) of the total project costs associated with the implementation of the repositioning or Product
Improvement Plan that are under Manager’s control (the “Project Costs”). The Project Management Fee shall be payable monthly in arrears based upon the prior calendar month’s total expenditures for Project Costs. In such
case that the Project Costs are budgeted to exceed five percent (5%) of Gross Revenues of a Hotel for the fiscal year ended immediately prior to the commencement date of such project (the “5% Revenue Threshold”), the Project
Management Fee shall be reduced to three percent (3%) of the total Project Costs in excess of the 5% Revenue Threshold. The Project Management Fee shall be accounted for and documented consistent with the requirements of Section 11.2
herein. Any onsite or dedicated personnel required for the direct supervision of the implementation of a renovation project or Product Improvement Plan will be a direct cost to, and shall be reimbursed by, the Landlord. 

 Section 3. Article XV of the Agreement is hereby amended by adding the following after Section 15.3:

 15.4 Internal Controls. 
 Manager shall maintain a system of internal accounting controls (“Controls”) that is sufficient to provide reasonable assurance that (i) transactions are executed in accordance with
Manager’s general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with generally accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with Manager’s general or specific authorization; and (iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate
action is taken with respect to any differences. Manager shall implement and maintain such internal control structures or procedures as reasonably requested from time to time by Lessee to facilitate Lessee’s preparation of periodic financial
reports. In the event that Lessee requests that Manager implement or change an internal control structure or procedure, Manager will have ninety (90) days to implement the control structure or procedure after Manager’s receipt of such
request from Lessee. Manager shall promptly report to Lessee any significant deficiency or material weakness in the Controls of which Manager becomes aware. In the event Manager fails to adopt and maintain Controls (including any Controls requested
by Lessee) and, as a consequence, transactions are not recorded, assets are not accounted for properly or expenditures are incurred without requisite approvals, Manager shall be liable to Lessee for the full amount of any lost revenues or unapproved
costs incurred regardless of whether the cause of such failure constituted negligence, gross negligence or willful misconduct. 
 Section
15.5. Certification. 
 Manager shall cause its chief executive officer and such other officers or employees as may be
requested from time to time by Lessee to certify to Lessee any one or more of the following: (i) the accuracy of any financial data or reports provided by Manager to Lessee; (ii) the compliance by Manager with the Controls including,
without limitation, any internal control procedures requested by Lessee; (iii) that Manager has implemented internal control procedures requested by Lessee and that there are no material deficiencies in such controls or, if such deficiencies
exist, identify the deficiencies, and (iv) such other matters as may be reasonably requested by Lessee. 
  

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 Section 15.6. Control Rules. 
 Without limiting the generality of the foregoing, Manager will provide, or cause its auditor to provide, Lessee and its internal and
external auditors with all descriptions of Controls, tests of Controls, audit reports and any other information that Lessee or its auditor deem appropriate or necessary to enable Lessee and its auditor to fulfill their legal obligations under the
Securities Act of 1933; the Securities Exchange Act of 1934; the Sarbanes Oxley Act of 2002; related rules and regulations of the Securities and Exchange Commission, including Regulation S-X; the rules, regulations and listing standards of the
American Stock Exchange; the rules, regulations and standards of the Public Company Accounting Oversight Board; and any other financial control or disclosure requirement imposed by law on public companies, as such legal requirements may be amended
or modified from time to time (the “Control Rules”). 
 (a) Manager will assist Lessee to comply with the
Control Rules by, without limitation, (i) documenting Controls; (ii) documenting regular internal assessments to test whether Controls are operating effectively; (iii) cooperating with Lessee and its auditors in connection with
testing the effectiveness of such Controls; (iv) advising Lessee in advance of any significant proposed change in such Controls and procedures; (v) issuing such interim or annual certifications as Lessee may reasonable request pursuant to
Section 15.5; (vi) implementing the additional or alternative Controls that Lessee from time to time requires; and (vii) correcting any material weakness or significant deficiency as defined by the Control Rules or any other
deficiency that would prevent Lessee from complying with the Control Rules. 
 (b) Lessee and its auditor will further be
entitled to conduct audits and tests of Controls at the hotels and Manager’s offices in order to obtain any additional evidence of effective internal control that Lessee or its auditor deem appropriate or necessary. Manager will grant
reasonable access by Lessee and its auditor to employees, facilities, data, records, systems, controls, processes and procedures in connection with any such audit. 
 Section 4. Remainder of Master Agreement. Except as set forth in this Amendment, the provisions of the Master Agreement remain in full force and effect without change, amendment, modification or waiver. 
  

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 Section 5. References. From and after the date of this Amendment, all references to the Master
Agreement shall be deemed to be references to the Master Agreement as amended by this Amendment. 
 Section 6. Counterparts. This
Amendment may be executed in several facsimile or electronic counterparts, each of which shall be an original and all of which constitute but one and the same instrument. 
 Section 7. Governing Law. This Amendment shall be governed by and construed in accordance with the laws of the Commonwealth of Virginia without regard to Virginia conflict of laws principles.

 Section 8. Necessary Authorization. Each Party represents and warrants that it has the necessary corporate and/or legal authority to
enter into this Amendment and that the individuals executing this Amendment have been duly authorized to do so and that such execution creates a valid, binding, and legally enforceable obligation of each Party. 
 [signatures follow on next page] 
  

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 IN WITNESS WHEREOF, the Parties have caused this Amendment Agreement Number 2 to be executed and
delivered as of the date first above written. 
  

			
	MHI HOSPITALITY TRS, LLC,
	a Delaware limited liability company
		
	By:	 	 /s/ Andrew M. Sims

	Name:	 	Andrew M. Sims
	Title:	 	Manager
	
	MHI HOTELS SERVICES LLC,
	a Virginia limited liability company
		
	By:	 	 /s/ Kim E. Sims

	Name:	 	Kim E. Sims
	Title:	 	President

  

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