Document:

Form of Property Acquisition/Disposition Agreement

 Exhibit 10.2 
  
 FORM OF 
 PROPERTY ACQUISITION/DISPOSITION 
 AGREEMENT 
  
 THIS AGREEMENT is made and entered into as of the
                    , 2004, by and between ORANGE HOSPITALITY, INC., a Maryland corporation (hereinafter referred to as the
“Company”), and ORANGE REALTY GROUP, LLC, a New Jersey limited liability company (hereinafter referred to as the “Advisor”). 
  
 W I T N E S S E T H: 
  
 WHEREAS, the Company plans to conduct business as a “real estate investment trust,” and, in connection therewith, plans to, from time to time,
acquire and dispose of real property, in particular, limited service, extended stay and other hotel properties (hereinafter referred to individually as a “Property” and collectively as the “Properties”); 
  
 WHEREAS, the Company desires to use the services of the Advisor in connection
with the acquisition and disposition of the Properties on the terms set forth in this Agreement; and 
  
 WHEREAS, the Company and the Advisor desire to enter into this Agreement for the purposes herein contained. 
  
 NOW, THEREFORE, in consideration of the promises herein contained, and for
other valuable consideration, receipt of which is hereby acknowledged, the parties agree as follows: 
  
 1. Engagement of Advisor. The Company hereby engages the Advisor as an advisor in connection with the purchase and sale of the Properties, upon the
conditions and for the term and compensation herein set forth. 
  
 2. Term of Agreement; Renewal. This Agreement shall continue in force until May     , 2005, subject to an unlimited number of successive one-year renewals upon mutual consent of the parties. 
  
 3. Acceptance of Engagement. The Advisor hereby accepts its engagement
as an advisor for the purchase and sale of the Properties and agrees to perform all services as follows: 
  

	 	a.	 	serve as the Company’s advisor with respect to the acquisition and disposition of Properties and provide research and economic and statistical data in connection with the
Company’s Properties; 

  

	 	b.	 	locate and analyze potential investments in Properties 

  

	 	c.	 	present analysis of potential investment in Properties to Directors and to Orange Advisors, LLC.; 

  

	 	d.	 	investigate, select, and, on behalf of the Company, engage and conduct business with such Persons as the Advisor deems necessary to the proper performance of its obligations

 hereunder, including but not limited to, consultants, accountants, correspondents, lenders, technical
advisors, attorneys, brokers, underwriters, corporate fiduciaries, escrow agents, depositaries, custodians, agents for collection, insurers, insurance agents, banks, builders, developers, property owners, mortgagors and any and all agents for any of
the foregoing, including affiliates of the Advisor, and persons acting in any other capacity deemed by the Advisor necessary or desirable for the performance of any of the services herein, including but not limited to entering into contracts in the
name of the Company with any of the foregoing; 
  

	 	e.	 	structure and negotiate the terms and conditions of transactions pursuant to which investment in Properties will be made by the Company; 

  

	 	f.	 	coordinate the activities of, and act as liaison between Company and independent professionals connected with the purchase or sale of a Property, including attorneys, appraisers,
engineers, inspectors, lenders, if any, and others; 

  

	 	g.	 	assist Company and its authorized representatives in satisfying any conditions precedent to the purchase or sale of a Property, which shall include contracting on behalf of Company
with any third parties whose services are required to close any such purchase or sale; 

  

	 	h.	 	negotiate on behalf of the Company with banks or lenders for loans to be made to the Company; provided, that any fees and costs payable to third parties incurred by the Advisor in
connection with the foregoing shall be the responsibility of the Company; 

  

	 	i.	 	from time to time, or at any time reasonably requested by the Directors, make reports to the Directors regarding prospective investments in Properties or its performance of services
to the Company under this Agreement; and 

  

	 	j.	 	do all things necessary to assure its ability to render the services described in this Agreement. 

  
 4. Compensation of Advisor. 
  

	 	(a)	 	The Company shall pay the Advisor as an acquisition fee 3.5% of Total Proceeds for services pursuant to this Agreement, subject to reduction under certain circumstances described
herein. The Company shall pay acquisition fees payable from gross offering proceeds to the Advisor as the Company receives offering proceeds from the sale of shares. Acquisition fees shall be reduced to the extent that, and if necessary to limit,
the total compensation paid to all persons involved in the acquisition of any property to the amount customarily charged in arms-length transactions by other persons or entities rendering similar services as an ongoing public activity in the same
geographical location and for comparable types of properties, and to the extent that other acquisition fees, finder’s fees, real estate commissions or other similar fees or commissions are paid by any person in connection with the transaction.
The total of all acquisition fees and any Acquisition Expenses shall be reasonable and shall not exceed an amount equal to six percent (6%) of the Contract Purchase Price of a Property unless a majority of the Board of Directors, including a
majority of the Independent Directors, not otherwise interested in the transaction, approves fees in excess of these limits subject to a determination that the transaction is commercially competitive, fair and reasonable to the Company.

	 	(b)	 	If the Advisor or an Affiliate provides a substantial amount of the services (as determined by a majority of the Independent Directors) in connection with the Sale of one or more
Properties, the Advisor shall receive a Subordinated Disposition Fee equal to the lesser of (i) one-half of a Competitive Real Estate Commission or (ii) 3% of the Contract Sales Price of such Property or Properties. The Subordinated Disposition Fee
will be paid only if Stockholders have received total Distributions in an amount equal to the sum of their aggregate Invested Capital and their aggregate Stockholders’ 8% Return. To the extent that Subordinated Disposition Fees are not paid by
the Company on a current basis due to the foregoing limitation, the unpaid fees will be accrued and paid at such time as the subordination conditions have been satisfied. The Subordinated Disposition Fee will be paid in addition to real estate
commissions paid to non-affiliates, provided that the total real estate commissions and fees paid to all persons by the Company (including the Subordinated Disposition Fee) shall not exceed an amount equal 6% of the Contract Sales Price of a
Property. If this Agreement is terminated prior to such time as the Stockholders have received total Distributions in an amount equal to 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the
Termination Date, an Appraisal of the Properties then owned by the Company shall be made and the Subordinated Disposition Fee on Properties previously sold will be deemed earned if the Appraised Value of the Properties then owned by the Company plus
total Distributions received prior to the Termination Date equals 100% of Invested Capital plus an amount sufficient to pay the Stockholders’ 8% Return through the Termination Date. Upon Listing, if the Advisor has accrued but not been paid
such Subordinated Disposition Fee, then for purposes of determining whether the subordination conditions have been satisfied, Stockholders will be deemed to have received a Distribution in the amount equal to the product of the total number of
Shares outstanding and the average closing price of the Shares over a period, beginning 180 days after Listing, of 30 days during which the Shares are traded. 

  

	 	(c)	 	In the event Company purchases, sells, conveys or otherwise transfers a Property within ninety (90) days after the expiration of this Agreement to a person or persons with whom
Advisor on behalf of Company has negotiated as a prospective buyer of a Property during the term of this Agreement, Advisor shall be deemed to have earned the compensation provided in Section 4(b) and such compensation shall be due and payable to
Advisor pursuant to the terms of this Agreement; provided, however, that (i) Advisor substantially performed all of the duties and obligations that it would otherwise have under this Agreement if the Agreement had not terminated, and (ii) Advisor
has given written notice to Company of the name of such buyer prior to the expiration of the term of this Agreement. 

  
 5. Other Activities of the Advisor. Nothing herein contained shall prevent the Advisor from engaging in other activities, including, without
limitation, the rendering of advice to other Persons (including other REITs) and the management of other programs advised, sponsored or organized by the Advisor or its Affiliates; nor shall this Agreement limit or restrict the right of any director,
officer, employee, or stockholder of the Advisor or its Affiliates to engage in any other business or to render services of any kind to any other partnership, corporation, firm, individual, trust or association. The Advisor may, with respect to any
investment in which the Company is a participant, also render advice and service to each and every other participant therein. The Advisor shall report to the Directors the existence 

 of any condition or circumstance, existing or anticipated, of which it has knowledge, which creates or could create a
conflict of interest between the Advisor’s obligations to the Company and its obligations to or its interest in any other partnership, corporation, firm, individual, trust or association. The Advisor or its Affiliates shall promptly disclose to
the Directors knowledge of such condition or circumstance. If the Sponsor, Advisor, Director or Affiliates thereof have sponsored other investment programs with similar investment objectives which have investment funds available at the same time as
the Company, it shall be the duty of the Directors (including the Independent Directors) to adopt the method set forth in the Registration Statement or another reasonable method by which properties are to be allocated to the competing investment
entities and to use their best efforts to apply such method fairly to the Company. 
  
 The Advisor shall be required to use its best efforts to participate in presenting a continuing and suitable investment program to the Company which is consistent with the investment policies and objectives of the
Company, but neither the Advisor nor any Affiliate of the Advisor shall be obligated generally to present any particular investment opportunity to the Company even if the opportunity is of character which, if presented to the Company, could be taken
by the Company. The Advisor or its Affiliates may make such an investment in a property only after (i) such investment has been offered to the Company and all public partnerships and other investment entities affiliated with the Company with funds
available for such investment and (ii) such investment is found to be unsuitable for investment by the Company, such partnerships and investment entities. 
  
 If the Advisor or its Affiliates is presented with a potential investment which might be made by the Company and by another investment entity which the
Advisor or its Affiliates advises or manages, the Advisor and its Affiliates shall consider the investment portfolio of each entity, cash flow of each entity, the effect of the acquisition on the diversification of each entity’s portfolio,
rental payments during any renewal period, the estimated income tax effects of the purchase on each entity, the policies of each entity relating to leverage, the funds of each entity available for investment and the length of time such funds have
been available for investment. In the event that an investment opportunity becomes available which is suitable for both the Company and a public or private entity which the Advisor or its Affiliates are Affiliated, then the entity which has had the
longest period of time elapse since it was offered an investment opportunity will first be offered the investment opportunity. 
  
 6. Relationship of Parties. The parties agree and acknowledge that Advisor is and shall operate as an independent contractor in performing its
duties under this Agreement and shall not be deemed an employee of Company. 
  
 7. Indemnification by the Company. The Company shall indemnify and hold harmless the Advisor and its Affiliates, including their respective officers, directors, partners and employees, from all liability,
claims, damages or losses arising in the performance of their duties hereunder, and related expenses, including reasonable attorneys’ fees, to the extent such liability, claims, damages or losses and related expenses are not fully reimbursed by
insurance, subject to any limitations imposed by the laws of the State of Maryland or the Articles of Incorporation. Notwithstanding the foregoing, the Advisor shall not be entitled to indemnification or be held harmless pursuant to this Paragraph 7
for any activity for which the Advisor shall be required to indemnify or hold harmless the Company pursuant to Paragraph 8. Any indemnification of the Advisor may be made only out of the net assets of the Company and not from Stockholders.

 8. Indemnification by Advisor. The Advisor shall indemnify and hold harmless the Company from
contract or other liability, claims, damages, taxes or losses and related expenses including attorneys’ fees, to the extent that such liability, claims, damages, taxes or losses and related expenses are not fully reimbursed by insurance and are
incurred by reason of the Advisor’s bad faith, fraud, willful misfeasance, misconduct, negligence or reckless disregard of its duties, but the Advisor shall not be held responsible for any action of the Board of Directors in following or
declining to follow any advice or recommendation given by the Advisor. 
  
 9. Definitions. As used in this Agreement, the following terms have the definitions hereinafter indicated:  
  
 Acquisition Expenses. Any and all expenses incurred by the Company, the Advisor or any Affiliate of either in connection with the selection or
acquisition of any Property, whether or not acquired, including, without limitation, legal fees and expenses, travel and communications expenses, costs of appraisals, nonrefundable option payments on property not acquired, accounting fees and
expenses, and title insurance. 
  
 Acquisition Fees. Any
and all fees and commissions, exclusive of Acquisition Expenses, paid by any person or entity to any other person or entity (including any fees or commissions paid by or to any Affiliate of the Company or the Advisor) in connection with the
purchase, development or construction of a Property, including, without limitation, real estate commissions, acquisition fees, finder’s fees, selection fees, development fees, construction fees, nonrecurring management fees, consulting fees,
loan fees, points, or any other fees or commissions of a similar nature. Excluded shall be development fees and construction fees paid to any person or entity not affiliated with the Advisor in connection with the actual development and construction
of any Property. The total of all Acquisition Fees and Acquisition Expenses shall not exceed an amount equal to six percent (6%) of the Contract Purchase Price of a Property, unless a majority of the Board of Directors, not otherwise interested in
the transaction, approves fees in excess of these limits subject to a determination that the transaction is commercially competitive, fair and reasonable to the Company. 
  
 Advisor. Orange Realty Group, LLC, a New Jersey limited liability company, any successor advisor to the Company, or
any person or entity to which Orange Realty Group, LLC or any successor advisor subcontracts substantially all of its functions. 
  
 Affiliate or Affiliated. As to any individual, corporation, partnership, trust or other association (other than the Excess Shares Trust), (i) any
Person or entity directly or indirectly through one or more intermediaries controlling, controlled by, or under common control with another person or entity; (ii) any Person or entity, directly or indirectly owning or controlling ten percent (10%)
or more of the outstanding voting securities of another Person or entity; (iii) any officer, director, partner, or trustee of such Person or entity; (iv) any Person ten percent (10%) or more of whose outstanding voting securities are directly or
indirectly owned, controlled, or held, with power to vote, by such other Person; and (v) if such other Person or entity is an officer, director, partner, or trustee of a Person or entity, the Person or entity for which such Person or entity acts in
any such capacity. 
  
 Appraised Value. Value according to
an appraisal made by an Independent Appraiser. 
  
 Articles of
Incorporation. The Articles of Incorporation of the Company under Title 2 of the Corporations and Associations Article of the Annotated Code of Maryland, as amended from time to time. 

 Board of Directors or Board. The persons holding such office, as of any particular time, under the
Articles of Incorporation, whether they be the Directors named therein or additional or successor Directors. 
  
 Bylaws. The bylaws of the Company, as the same are in effect from time to time. 
  
 Code. Internal Revenue Code of 1986, as amended from time to time, or any successor statute thereto. Reference to any
provision of the Code shall mean such provision as in effect from time to time, as the same may be amended, and any successor provision thereto, as interpreted by any applicable regulations as in effect from time to time. 
  
 Company. Orange Hospitality, Inc., a corporation organized under the
laws of the State of Maryland. 
  
 Company Property. Any
and all property, real, personal or otherwise, tangible or intangible, which is transferred or conveyed to the Company (including all rents, income, profits and gains therefrom), and which is owned or held by, or for the account of, the Company.

  
 Competitive Real Estate Commission. A real estate or
brokerage commission for the purchase or sale of property, which is reasonable, customary, and competitive in light of the size, type, and location of the property. The total of all real estate commissions paid by the Company to all Persons in
connection with any Sale of one or more of the Company’s Properties shall not exceed the lesser of (i) a Competitive Real Estate Commission or (ii) six percent of the gross sales price of the Property or Properties. 
  
 Contract Purchase Price. The amount actually paid or allocated (as of
the date of purchase) to the purchase, development, construction or improvement of property, exclusive of Acquisition Fees and Acquisition Expenses. 
  
 Contract Sales Price. The total consideration received by the Company for the sale of Company Property. 
  
 Director. A member of the Board of Directors of the Company.

  
 Distributions. Any distributions of money or other
property by the Company to owners of Equity Shares, including distributions that may constitute a return of capital for federal income tax purposes. 
  
 Equity Interest. The stock of or other interests in, or warrants or other rights to purchase the stock of or other interests in, any entity that
has borrowed money from the Company or that is a tenant of the Company or that is a parent or controlling Person of any such borrower or tenant. 
  
 Equity Shares. Transferable shares of beneficial interest of the Company of any class or series, including common shares or preferred shares.

  
 Gross Proceeds. The aggregate purchase price of all
Shares sold for the account of the Company through the Offering without deduction for selling commissions, discounts, the marketing allowance or Organizational and Offering Expenses. 
  
 Independent Appraiser. A qualified appraiser of real estate as determined by the Board. Membership in a nationally
recognized appraisal society such as the American Institute of Real Estate Appraisers (“M.A.I.”) or the Society of Real Estate Appraisers (“S.R.E.A.”) shall be conclusive evidence of such qualification. 

 Independent Director. A Director who is not and within the last two years has not been directly or
indirectly associated with the Advisor by virtue of (i) ownership of an interest in the Advisor or its Affiliates, (ii) employment by the Advisor or its Affiliates, (iii) service as an officer or director of the Advisor or its Affiliates, (iv)
performance of services, other than as a Director, for the Company, (v) service as a director or trustee of more than three real estate investment trusts advised by the Advisor, or (vi) maintenance of a material business or professional relationship
with the Advisor or any of its Affiliates. A business or professional relationship is considered material if the gross revenue derived by the Director from the Advisor and Affiliates exceeds 5% of either the Director’s annual gross revenue
during either of the last two years or the Director’s net worth on a fair market value basis. An indirect relationship shall include circumstances in which a Director’s spouse, parents, children, siblings, mothers- or fathers-in-law, sons-
or daughters-in-law, or brothers- or sisters-in-law is or has been associated with the Advisor, any of its Affiliates, or the Company. 
  
 Invested Capital. The amount calculated by multiplying the total number of Shares purchased by Stockholders by the issue price, reduced by the
portion of any Distribution that is attributable to Net Sales Proceeds and by any amounts paid by the Company to repurchase Shares pursuant to the Company’s plan for redemption of Shares. 
  
 Joint Venture. The joint venture or general partnership arrangements
in which the Company is a co-venturer or general partner which are established to acquire Properties. 
  
 Listing. The listing of the Shares on a national securities exchange or the Nasdaq stock market. Listing does not include trading through the OTC
Bulletin Board. 
  
 Net Sales Proceeds. In the case of a
transaction described in clause (i)(A) of the definition of Sale, the proceeds of any such transaction less the amount of all real estate commissions and closing costs paid by the Company. In the case of a transaction described in clause (i)(B) of
such definition, Net Sales Proceeds means the proceeds of any such transaction less the amount of any legal and other selling expenses incurred in connection with such transaction. In the case of a transaction described in clause (i)(C) of such
definition, Net Sales Proceeds means the proceeds of any such transaction actually distributed to the Company from the Joint Venture. In the case of a transaction described in clause (ii) of the definition of Sale, Net Sales Proceeds means the
proceeds of such transaction or series of transactions less all amounts generated thereby and reinvested in one or more Properties within 180 days thereafter and less the amount of any real estate commissions, closing costs, and legal and other
selling expenses incurred by or allocated to the Company in connection with such transaction or series of transactions. Net Sales Proceeds shall also include, in the case of any lease of a Property consisting of a building only, amounts from
tenants, borrowers or lessees that the Company determines, in its discretion, to be economically equivalent to proceeds of a Sale. Net Sales Proceeds shall not include, as determined by the Company in its sole discretion, any amounts reinvested in
one or more Properties, to repay outstanding indebtedness, or to establish reserves. 
  
  Offering. The public offering of 33,375,439 Shares. 
   
 Organizational and Offering Expenses. Organizational and Offering Expenses are defined as any and all costs and expenses, other than selling
commissions and the 1.5% marketing allowance incurred by the Company, the advisor or any affiliate of either in connection with the formation, qualification and 

 registration of the Company and the marketing and distribution of Shares, including, without limitation, the following:
legal, accounting and escrow fees; printing, amending, supplementing, mailing and distributing costs; filing, registration and qualification fees and taxes; telegraph and telephone costs; and all advertising and marketing expenses, including the
costs related to investor and broker-dealer sales meetings. The Organizational and Offering Expenses paid by the Company in connection with its formation, together with all selling commissions and the 1.5% marketing allowance, will not exceed
fifteen percent of the proceeds raised in connection with the Offering. 
  
 Person. An individual, corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes
described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity, or any government or any agency or political subdivision thereof, and also includes a
group as that term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, but does not include (i) an underwriter that participates in a public offering of Equity Shares for a period of sixty (60) days following
the initial purchase by such underwriter of such Equity Shares in such public offering, or (ii) Briad Development West, LLC, during the period ending December 31, 2004, provided that the foregoing exclusions shall apply only if the ownership of such
Equity Shares by an underwriter or Briad Development West, LLC would not cause the Company to fail to qualify as a REIT by reason of being “closely held” within the meaning of Section 856(a) of the Code or otherwise cause the Company to
fail to qualify as a REIT. 
  
 Property or Properties. The
real properties, including the buildings located thereon, or the real properties only, or the buildings only, which are acquired by the Company, either directly or through joint venture arrangements or other partnerships. 
  
 Registration Statement. The Registration Statement (No.
            ) on Form S-11 registering the Shares to be sold in the Offering. 
  
 REIT. A “real estate investment trust” under Sections 856 through 860 of the Code. 
  
 Sale or Sales. (i) Any transaction or series of transactions whereby:
(A) the Company sells, grants, transfers, conveys, or relinquishes its ownership of any Property, or other asset not included in clause (i)(B), or portion thereof, including the lease of any Property consisting of the building only, and including
any event with respect to any Property which gives rise to a significant amount of insurance proceeds or condemnation awards; (B) the Company sells, grants, transfers, conveys, or relinquishes its ownership of all or substantially all of the
interest of the Company in any Joint Venture in which it is a co-venturer or partner; or (C) any Joint Venture in which the Company as a co-venturer or partner sells, grants, transfers, conveys, or relinquishes its ownership of any Property or
portion thereof, including any event with respect to any Property which gives rise to insurance claims or condemnation awards; but (ii) not including any transaction or series of transactions specified in clause (i)(A), (i)(B), or (i)(C) above in
which the proceeds of such transaction or series of transactions are reinvested in one or more Properties within 180 days thereafter. 
  
 Securities. Any Equity Shares, Excess Shares, as such term is defined in the Articles of Incorporation, any other stock, shares or other evidences
of equity or beneficial or other interests, voting trust certificates, bonds, debentures, notes or other evidences of indebtedness, secured or unsecured, convertible, subordinated or otherwise, or in general any instruments commonly known as
“securities” or any certificates of interest, shares or participations in, temporary or interim certificates for, receipts for, guarantees of, or warrants, options or rights to subscribe to, purchase or acquire, any of the foregoing.

 Shares. The common shares of the Company. 
  
 Sponsor. Any Person directly or indirectly instrumental in organizing,
wholly or in part, the Company or any Person whom will control, manage or participate in the management of the Company, and any Affiliate of such Person. Not included is any Person whose only relationship with the Company is that of an independent
property manager of Company assets, and whose only compensation is as such. Sponsor does not include independent third parties such as attorneys, accountants, and underwriters whose only compensation is for professional services. A Person may also
be deemed a Sponsor of the Company by: 
  

	 	a.	 	taking the initiative, directly or indirectly, in founding or organizing the business or enterprise of the Company, either alone or in conjunction with one or more other Persons;

  

	 	b.	 	receiving a material participation in the Company in connection with the founding or organizing of the business of the Company, in consideration of services or property, or both
services and property; 

  

	 	c.	 	having a substantial number of relationships and contacts with the Company; 

  

	 	d.	 	possessing significant rights to control Company properties; 

  

	 	e.	 	receiving fees for providing services to the Company which are paid on a basis that is not customary in the industry; or 

  

	 	f.	 	providing goods or services to the Company on a basis which was not negotiated at arms length with the Company. 

  
 Stockholders. The registered holders of the Equity Shares. 

 
 Stockholders’ 8% Return. As of each date, an aggregate amount
equal to an 8% cumulative, non-compounded, annual return on Invested Capital. 
  
 Subordinated Disposition Fee. The fee payable to the Advisor in connection with the Sale of Properties pursuant to this Agreement. 
  
 Termination Date. The date of termination of the Agreement. 
  
 Total Proceeds. The Gross Proceeds received in the Offering plus loan
proceeds from permanent financing). 

 10. Notices. Any notice, report or other communication required or permitted to be given hereunder
shall be in writing unless some other method of giving such notice, report or other communication is required by the Articles of Incorporation, the Bylaws, or accepted by the party to whom it is given, and shall be given by being delivered by hand
or by overnight mail or other overnight delivery service to the addresses set forth herein: 
  
 To the Directors and to the Company: 
  

							
	 	 	Orange Hospitality, Inc.	 	 	 	 
				
	 	 	
	 	 	 	 
				
	 	 	
	 	 	 	 
				
	 	 	
	 	 	 	 
				
	 To the Advisor:
	 	Orange Realty Group, LLC	 	 	 	 
				
	 	 	
	 	 	 	 
				
	 	 	
	 	 	 	 
				
	 	 	
	 	 	 	 

  
 Either party may at any time give
notice in writing to the other party of a change in its address for the purposes of this Paragraph 10. 
  
 11. Modification. This Agreement shall not be changed, modified, terminated, or discharged, in whole or in part, except by an instrument in writing
signed by both parties hereto, or their respective successors or assignees. 
  
 12. Severability. The provisions of this Agreement are independent of and severable from each other, and no provision shall be affected or rendered invalid or unenforceable by virtue of the fact that for any
reason any other or others of them may be invalid or unenforceable in whole or in part. 
  
 13. Construction. The provisions of this Agreement shall be construed and interpreted in accordance with the laws of the State of New Jersey. 
  
 14. Entire Agreement. This Agreement contains the entire agreement and understanding among the parties hereto with
respect to the subject matter hereof, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter hereof. The
express terms hereof control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms hereof. This Agreement may not be modified or amended other than by an agreement in writing. 
  
 15. Indulgences, Not Waivers. Neither the failure nor any delay on the
part of a party to exercise any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power or privilege preclude any other or further exercise of the
same or of any other right, remedy, power or privilege, nor shall any waiver of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other
occurrence. No waiver shall be effective unless it is in writing and is signed by the party asserted to have granted such waiver. 
  
 16. Gender. Words used herein regardless of the number and gender specifically used, shall be deemed and construed to include any other number,
singular or plural, and any other gender, masculine, feminine or neuter, as the context requires. 
  
 17. Titles Not to Affect Interpretation. The titles of paragraphs and subparagraphs contained in this Agreement are for convenience only, and they
neither form a part of this Agreement nor are they to be used in the construction or interpretation hereof. 

 18. Execution in Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts hereof,
individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories. 
  
 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written. 
  

					
	 COMPANY:

	
	ORANGE HOSPITALITY, INC.,
	 a Maryland corporation

		
	 By:
	 	  

	 	 	 Name:
	 	  

	 	 	 Title:
	 	  

	
	 ADVISOR:

	
	ORANGE REALTY GROUP, LLC,
	 a New Jersey limited liability company

		
	 By:
	 	  

	 	 	 Name:
	 	  

	 	 	 Title:Time Option Agreement dated September 16, 2004.

 Exhibit 10.2 
  
 TIME OPTION AGREEMENT 
  
 THIS AGREEMENT (the “Agreement”), is made effective as of the 16th day of September, 2004 (hereinafter called the “Grant Date”), between ST. JOHN KNITS INTERNATIONAL, INCORPORATED, a Delaware corporation
(hereinafter called the “Company”), and Richard Cohen (hereinafter called the “Participant”): 
  
 R E C I T A L S: 
  
 WHEREAS, the Company has adopted the Amended and Restated St. John Knits International, Incorporated 1999 Stock Option Plan (the “Plan”), which
Plan is incorporated herein by reference and made a part of this Agreement. Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan; 
  
 WHEREAS, the Committee has determined that it would be in the best interests of the Company and its stockholders to grant
the option provided for herein (the “Option”) to the Participant pursuant to the Plan and the terms set forth herein; and 
  
 WHEREAS, simultaneous with the Company’s grant of this Option to the Participant, the Participant acknowledges that Participant shall, if the
Participant has not already, become a party to the Management Stockholders’ Agreement between and among St. John Knits, Inc., the Company, Vestar/Gray Investors LLC, Vestar/SJK Investors LLC (“Vestar”) and all other members of
management of the Company who have received or will receive options to acquire shares of Common Stock (the “Management Stockholders’ Agreement”). 
  

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties agree as follows: 
  
 1. Grant of the Option. The Company hereby grants to the Participant
the right and option (the “Option”) to purchase, on the terms and conditions hereinafter set forth, all or any part of an aggregate of 200,000 shares of Common Stock, subject to adjustment as set forth in the Plan. The per share purchase
price of the shares of Common Stock subject to the Option (the “Exercise Price”) shall be (a) $30.00 with respect to 50,000 shares, (b) $40.00 with respect to 50,000 shares, (c) $50.00 with respect to 50,000 shares and (d) $60.00 with
respect to 50,000 shares (each tranche of shares described in clauses (a) through (d), a “Tranche”). The Option is intended to be a non-qualified stock option, and is not intended to be treated as an option that complies with Section 422
of the Internal Revenue Code of 1986, as amended. 
  
 2.
Vesting. At any time, the percentage of the Option which has become vested and exercisable as described in this Section 2 is hereinafter referred to as the “Vested Portion.” 
  

 

 (a) Time Vesting. Subject to paragraphs (b) and (c) of this Section 2, each Tranche shall vest and
become exercisable with respect to twenty percent (20%) of the shares of Common Stock initially covered by the Tranche on August 9, 2005 and shall vest and become exercisable with respect to an additional twenty percent (20%) of the shares of Common
Stock initially covered by the Tranche on each subsequent anniversary of such August 9 date, until the shares subject to the Option are 100% vested. 
  
 (b) Termination of Employment. If the Participant’s employment with the Company or any Subsidiary is terminated for any reason, the Option
shall, to the extent not then vested, be canceled by the Company without consideration and the Vested Portion of the Option shall remain exercisable for the period set forth in Section 3(a); provided, however, that, in the event of the
Participant’s termination of employment by the Company or any Subsidiary without Cause (other than as a result of death or Disability) or by the Participant for Good Reason, the Participant shall be deemed vested in the portion of the Option
that otherwise would have become exercisable on or before the second anniversary of the Participant’s date of termination. For purposes of this agreement, the date of the Participant’s termination of employment shall be determined under
the Employment Agreement, dated as of June 3, 2004, by and between the Participant and St. John Knits, Inc. (or any amendment thereto). 
  
 (c) Change of Control/Acceleration Events. 
  
 (i) Notwithstanding any other provisions of this Agreement to the contrary, in the event of a Partial Acceleration Event (as defined below), Executive
shall be deemed vested in a portion of the Option equal to the excess, if any, of the Vestar Percentage (as defined below) over the Vested Portion of the Option. For purposes of this Agreement, (A) a “Partial Acceleration Event” shall mean
and shall be deemed to have taken place in the event (I) Vestar and its Affiliates (as defined in the Management Stockholders’ Agreement) (collectively, the “Vestar Entities”), pursuant to one or more than one transaction, other than
a Public Offering (as defined in the Management Stockholders’ Agreement), sell, exchange or dispose of shares of Common Stock where the percentage of shares sold, exchanged or disposed of is less than 50% of the shares of Common Stock held by
the Vestar Entities as of June 3, 2004 (the “Vestar Shares”), (II) Executive receives a Tag Notice (as defined in the Management Stockholders’ Agreement) with respect to any transaction that would otherwise result in a Partial
Acceleration Event described in clause (I) of this Section 2(c)(i), but only for purposes of participating in such transaction, or (III) any of the Vestar Entities request that Executive make a drag-along transfer as permitted by Section 3.6 of the
Management Stockholders’ Agreement with respect to any transaction that would otherwise result in a Partial Acceleration Event described in clause (I) of this Section 2(c)(i), but only for purposes of participating in such transaction, and (B)
the “Vestar Percentage” shall mean the percentage of the Vestar Shares sold by the Vestar Entities in connection with a Partial Acceleration Event. 
  
 (ii) Notwithstanding any other provisions of this Agreement to the contrary, in the event of a change of control or an Equity Acceleration Event (as
defined below), the Option shall, to the extent not then vested and not previously canceled, immediately become fully vested and exercisable. For purposes of this Agreement, (A) a change of control shall be deemed to occur as determined in the sole
discretion of the Committee and (B) an “Equity Acceleration Event” shall mean and shall be deemed to have taken place in the event (I) the Vestar Entities, 

  

 

 
pursuant to one or more than one transaction, other than a Public Offering, sell, exchange or dispose of 50% or more of the Vestar Shares, (II) the Company
or any of its Subsidiaries sells, assigns, conveys, transfers, leases or otherwise disposes of all or substantially all of the assets of the Company and its Subsidiaries (determined on a consolidated basis) to any “person” (as such term is
used in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934) (other than to the Company and/or any wholly-owned Subsidiary of the Company), (III) any other transaction involving the Company or St. John Knits, Inc. occurs and in respect
of which the Vestar Entities receive proceeds in such transaction, directly or indirectly, in respect of the disposition of 50% or more of the Vestar Shares, (IV) Executive receives a Tag Notice (as defined in the Management Stockholders’
Agreement) with respect to any transaction that would otherwise result in a Equity Acceleration Event described in clauses (I), (II) or (III) of this Section 2(c)(ii), but only for purposes of participating in such transaction, or (V) any of the
Vestar Entities request that Executive make a drag-along transfer as permitted by Section 3.6 of the Management Stockholders’ Agreement with respect to any transaction that would otherwise result in a Equity Acceleration Event described in
clauses (I), (II) or (III) of this Section 2(c)(ii), but only for purposes of participating in such transaction. 
  
 3. Exercise of Option. 
  
 (a) Period of Exercise. Subject to the provisions of the Plan and this Agreement, the Participant may exercise all or any part of the Vested
Portion of the Option at any time prior to the earliest to occur of: 
  
 (i) the tenth anniversary of the Grant Date; 
  
 (ii)
eighteen months following the date of the Participant’s termination of employment as a result of death or Disability; 
  
 (iii) three years following the date of the Participant’s termination of employment by the Company or any Subsidiary without Cause (other than as a
result of death or Disability) or by the Participant for Good Reason; and 
  
 (iv) the date of the Participant’s termination of employment by the Company or any Subsidiary for Cause or by the Participant without Good Reason. 
  
 For purposes of this Agreement: 
  
 “Cause” shall mean “cause” as defined in any employment agreement entered into by and between the Participant and the
Company or any of its Subsidiaries which is in effect as of or after the Grant Date (as the same may be amended in accordance with the terms thereof) or if not defined therein or if there shall be no such agreement, “Cause” shall mean (i)
willful malfeasance or willful misconduct in connection with the performance of his duties as such, or (ii) the commission of (a) any felony or (b) a misdemeanor involving moral turpitude; 
  
 “Disability” shall mean “disability” as
defined in any employment agreement entered into by and between the Participant and the Company or any of its Subsidiaries which is in effect as of or after the Grant Date (as the same may be amended in 

  

 

 
accordance with the terms thereof) or if not defined therein or if there shall be no such agreement, as defined in the Company long-term disability plan as
in effect from time to time, or if there shall be no plan or if not defined therein, the Participant’s becoming physically or mentally incapacitated and consequent inability for a period of six (6) months in any twelve (12) consecutive month
period to perform the Participant’s duties to the Company or any Subsidiary; and 
  
 “Good Reason” shall mean “good reason” as defined in any employment agreement entered into by and between the
Participant and the Company or any of its Subsidiaries which is in effect as of or after the Grant Date (as the same may be amended in accordance with the terms thereof) or if not defined therein or if there shall be no such agreement, “Good
Reason” shall mean: (i) the Company or any Subsidiary has failed to pay the Participant his salary; (ii) the office where the Participant performs his duties is moved more than 30 miles from where the Participant performed the
Participant’s duties on the Grant Date; (iii) a substantial reduction of the Participant’s base salary (other than an across the board reduction similarly affecting other comparable employees of the Company or its Subsidiaries) or (iv) a
substantial diminution of the Participant’s duties, which, in each case, has not been remedied within a reasonable time specified by the Participant that is not less than thirty (30) days after delivery to the Company of written notice
describing the event constituting Good Reason. 
  
 (b) Method
of Exercise. 
  
 (i) Subject to Section 3(a), the Vested
Portion of the Option may be exercised by delivering to the Company at its principal office written notice of intent to so exercise; provided that the Option may be exercised with respect to whole shares of Common Stock only. Such notice
shall specify the number of shares of Common Stock for which the Option is being exercised and the Tranche from which such shares are to come and shall be accompanied by payment in full of the Exercise Price with respect to each Tranche. The payment
of the Exercise Price shall be made in cash or, subject to the consent of the Committee, in shares of Common Stock which have been owned by the Participant for at least six months, such shares to be valued at their Fair Market Value (as such term is
defined in the Management Stockholders’ Agreement) as of the date of exercise. 
  
 (ii) Notwithstanding any other provision of the Plan or this Agreement to the contrary, the Option may not be exercised prior to the completion of any registration or qualification of the Option or the shares of
Common Stock that is required to comply with applicable state and federal securities or any ruling or regulation of any governmental body or national securities exchange that the Committee shall in its sole discretion determine in good faith to be
necessary or advisable. 
  
 (iii) Upon the Company’s
determination that the Option has been validly exercised as to any of the shares of Common Stock, the Company shall issue certificates in the Participant’s name for such shares. However, the Company shall not be liable to the Participant for
damages relating to any delays in issuing the certificates to him, any loss of the certificates, or any mistakes or errors in the issuance of the certificates or in the certificates themselves. 
  

 

 (iv) In the event of the Participant’s death, the Vested Portion of the Option shall remain
exercisable by the Participant’s executor or administrator, or the person or persons to whom the Participant’s rights under this Agreement shall pass by will or by the laws of descent and distribution as the case may be, to the extent set
forth in Section 3(a) (any of the foregoing, a “Permitted Transferee”). Any heir or legatee of the Participant shall take rights herein granted subject to the terms and conditions hereof. During the Participant’s lifetime, the Option
is exercisable only by the Participant. 
  
 (v) As a condition to
exercising the Option, the Participant shall become a party to the Management Stockholders’ Agreement. 
  
 4. No Right to Continued Employment. Neither the Plan nor this Agreement shall be construed as giving the Participant the right to be retained in
the employ of, or in any consulting relationship to, the Company or any Affiliate. Further, the Company or an Affiliate may at any time dismiss the Participant or discontinue any consulting relationship, free from any liability or any claim under
the Plan or this Agreement, except as otherwise expressly provided herein. 
  
 5. Legend on Certificates. To the extent provided by the Management Stockholders’ Agreement, the certificates representing the shares of Common Stock purchased by exercise of the Option shall contain a
legend stating that they are subject to the Management Stockholders’ Agreement and may be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange upon which such shares are listed, and any applicable Federal or state laws, and the Committee may cause an additional legend or legends to be put on any such certificates to
make appropriate reference to such other restrictions. 
  
 6.
Transferability. The Option may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by the Participant otherwise than to a Permitted Transferee, and any such purported assignment, alienation, pledge,
attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company or any Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer
or encumbrance. No such permitted transfer of the Option to a Permitted Transferee shall be effective to bind the Company unless the Committee shall have been furnished with written notice thereof and a copy of such evidence as the Committee may
deem necessary to establish the validity of the transfer and the acceptance by the Permitted Transferee or Transferees of the terms and conditions hereof. 
  
 7. Withholding. A Participant shall be required to pay to the Company or any Affiliate, and the Company shall have the right and is hereby
authorized to withhold, any applicable minimum withholding taxes in respect of an Option, its exercise or any payment or transfer under an Option or under the Plan and to take such other action as may be necessary in the opinion of the Company to
satisfy all obligations for the payment of such minimum withholding taxes. 
  

 

 8. Securities Laws; Representations. 
  
 (a) Upon the acquisition of any shares of Common Stock pursuant to the exercise of the Option, the Participant will make or
enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws or with this Agreement. 
  
 (b) Participant represents and warrants that Participant, either alone or with a representative advisor, has sufficient
knowledge and experience in financial and business matters that Participant is capable of evaluating the merits and risks of this Option grant and, in the event such Option is exercised, the ownership of such shares of Common Stock. 
  
 9. Notices. Any notice necessary under this Agreement shall be
addressed to the Company in care of its Secretary at the principal executive office of the Company and to the Participant at the address appearing in the personnel records of the Company for the Participant or to either party at such other address
as either party hereto may hereafter designate in writing to the other. Any such notice shall be deemed effective upon receipt thereof by the addressee. 
  
 10. Choice of Law. THE INTERPRETATION, PERFORMANCE AND ENFORCEMENT OF THIS AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF DELAWARE
WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. 
  
 11.
Option Subject to Plan and Management Stockholders’ Agreement. By entering into this Agreement the Participant agrees and acknowledges that the Participant has received and read a copy of the Plan and the Management Stockholders’
Agreement. The Option is subject to the Plan and the Management Stockholders’ Agreement. The terms and provisions of the Plan and the Management Stockholders’ Agreement as they may be amended from time to time in accordance with their
respective terms are hereby incorporated herein by reference. In the event of a conflict between any term or provision contained herein and a term or provision of the Plan or the Management Stockholders’ Agreement, the applicable terms and
provisions of this Agreement will govern and prevail. In the event of a conflict between any term or provision of the Plan and any term or provision of the Management Stockholders’ Agreement, the applicable terms and provisions of the
Management Stockholders’ Agreement will govern and prevail. 
  
 12. Signature in Counterparts. This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument. 
  

 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement. 
  

			
	ST. JOHN KNITS INTERNATIONAL, INCORPORATED
		
	By:	 	 
		
	 Title:
	 	 

  

	
	 Agreed and acknowledged as of the date
 first above written:

	
	 /s/ Richard Cohen

	 Richard Cohen

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