SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT NO. 3 TO
SCHEDULE 14D-9
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(d)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
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RED ROOF INNS, INC.
(Name of Subject Company)
RED ROOF INNS, INC.
(Name of Person(s) Filing Statement)
Common Stock, par value $.01 per share
(Title of Class of Securities)
757005103
(CUSIP Number of Class of Securities)
Alan L. Tallis, Esq.
Executive Vice President, Development,
General Counsel and Secretary
Red Roof Inns, Inc.
4355 Davidson Road
Hilliard, Ohio 43026
(614) 876-3201
(Name, Address and Telephone Number of Person Authorized to Receive
Notice and Communications on Behalf of the Person(s) Filing Statement)
With a Copy to:
Jeffrey W. Tindell, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
919 Third Avenue
New York, New York 10022-3897
(212) 735-3000
This Amendment supplements and amends as Amendment No. 3 to the
Solicitation/Recommendation Statement on Schedule 14D-9, originally filed
on July 16, 1999 and as previously amended (as amended, the "Schedule 14D-
9"), by Red Roof Inns, Inc., a Delaware corporation (the "Company"),
relating to the tender offer (the "Offer") by RRI Acquisition Corp., a
Delaware corporation ("Purchaser"), and an indirect, wholly owned
subsidiary of Accor S.A., a corporation organized under the laws of France
("Parent"), disclosed in a Tender Offer Statement on Schedule 14D-1, dated
July 16, 1999, to purchase all of the outstanding shares of common stock,
par value $0.01 per share (the "Shares"), of the Company, at a price of
$22.75 per Share, net to the seller in cash (subject to applicable
withholding), upon the terms and subject to the conditions set forth in the
Offer to Purchase dated July 16, 1999 of Parent and Purchaser and the
related Letter of Transmittal. Capitalized terms used and not otherwise
defined herein shall have the meanings set forth in the Schedule 14D-9.
ITEM 3. IDENTITY AND BACKGROUND
(a) Item 3(b) is hereby amended by replacing in its entirety the
paragraph under the caption "Arrangements with Executive
Officers, or Affiliates of the Company - Change in Control
Severance Plan" with the following:
"On July 10, 1999, the Board of Directors approved the terms of
the Red Roof Inns, Inc. Change in Control Severance Plan (the
"Severance Plan"). The terms of the Severance Plan are described
below and the Severance Plan is filed as Exhibit 18 to the
Schedule 14D-9 . Under the Severance Plan, severance benefits
will be provided to certain active employees whose employment is
terminated other than for cause (as defined in the Severance
Plan) or who elect to terminate their employment if the terms of
their employment after the closing are not equivalent to the
terms of their employment prior to the closing, in either case,
within two years following the closing. An employee who is a
party to either a severance agreement or an employment letter
agreement with severance provisions will receive pay and benefits
as determined by such agreement. To the extent that any payment
or benefit under the Severance Plan differs from those provided
in such agreement (on an item-by-item basis), the employee will
receive the greater of the payments and/or benefits under the
Severance Plan or the payments and/or benefits under such
agreement. Severance payments under the Severance Plan will be
based on years of service. Employees in salary grades 15 and
above will receive a minimum of 20 weeks of base pay, while
employees in salary grades 12, 13 and 14 will receive a minimum
of 16 weeks of base pay and employees in salary grades 11 and
below will receive a minimum of 8 weeks of base pay. In
addition, participants will receive a pro rata bonus, payment in
lieu of unused vacation days, welfare benefit coverage,
outplacement services or payment in lieu thereof, vesting of
401(k) and deferred compensation accounts, payment of certain
commissions and reimbursement of legal fees incurred in any
dispute arising under the Severance Plan. Generally, the
participant must sign a mutual release of claims prior to
receiving benefits under the Severance Plan."
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS
(a) Item 9 is hereby amended by adding a new exhibit as follows:
Exhibit 18. Red Roof Inns, Inc. Change in Control Severance
Plan
SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete
and correct.
Dated: August 10, 1999 RED ROOF INNS, INC.
By: /s/ David L. Rea
-----------------------------------
Name: David L. Rea
Title: Executive Vice President, Chief
Financial Officer and Treasurer
EXHIBIT 18
RED ROOF INNS, INC.
CHANGE IN CONTROL SEVERANCE PLAN
The Company hereby adopts the Red Roof Inns, Inc. Change in
Control Severance Plan (the "Plan") for the benefit of certain employees of
the Company, on the terms and conditions hereinafter stated.
The Plan, as set forth herein, is intended to help retain
qualified employees, maintain a stable work environment and provide
economic security to certain employees of the Company in the event of a
Severance of employment under the enumerated circumstances. The Plan, as a
"severance pay arrangement" within the meaning of Section 3(2)(B)(i) of
ERISA, is intended to be excepted from the definitions of "employee pension
benefit plan" and "pension plan" set forth under Section 3(2) of ERISA, and
is intended to meet the descriptive requirements of a plan constituting a
"severance pay plan" within the meaning of regulations published by the
Secretary of Labor at Title 29, Code of Federal Regulations,
section 2510.3-2(b).
SECTION 1. DEFINITIONS. As hereinafter used:
1.1 "Board" shall mean the Board of Directors of the Company.
1.2 "Bonus" shall mean the greater of (a) the bonus that the
Employee would have earned under the annual bonus plan of the Company in
which the Employee is eligible to participate with respect to fiscal year
1999, assuming the Employee had earned the maximum bonus calculable
thereunder and (b) the bonus that the Employee would have earned under the
annual bonus plan of the Company in which the Employee is eligible to
participate with respect to the fiscal year in which the Employee incurs a
Severance, assuming the Employee had earned the maximum bonus calculable
thereunder. For purposes of this Section 1.2, "annual bonus plan" shall
include but not be limited to the Company's Management Incentive Bonus
Plan, any Company sales bonus plan or inn level bonus plan, and any other
bonus plan maintained by the Company having maximum target bonus levels.
1.3 "Cause" shall mean, with respect to a termination of the
Employee's employment with the Company:
(a) with respect to employees other than hourly reservation and hourly
inn level employees, (i) the willful and continued failure by the
Employee to substantially perform the Employee's duties with the
Company (other than any such failure resulting from the Employee's
incapacity due to physical or mental illness) after a written
demand for substantial performance is delivered to the Employee by
the President or his designate which specifically identifies the
manner in which the Employee has not substantially performed his
duties, (ii) a demonstrable, intentional and willful act or failure
to act committed by the Employee, which act or failure to act
results in material financial harm to the Company or (iii) the
conviction of the Employee for an act of common law fraud,
embezzlement or theft, or any other act constituting a felony. For
purposes of this paragraph 1.3, no act or failure to act on the
Employee's part shall be considered "willful" unless done or
omitted to be done by the employee not in good faith and without
reasonable belief that such action or omission was not inconsistent
with the best interests of the Company; and
(b) with respect to hourly reservation and hourly inn level employees,
a termination of employment in accordance with the Company's
Standards of Employee Conduct as in effect on the Effective Date.
1.4 "Change in Control" shall have the meaning set forth in
Section 11(b) of the Company's Employee Stock Purchase Plan (without regard
to Section 11(d) thereof) as in effect on the Effective Date. Without
limiting the generality of the foregoing, the "consummation of the Offer,"
as that phrase is used in the Agreement and Plan of Merger by and among
Accor S.A., RRI Acquisition Corp. and the Company, dated as of July 10,
1999 (the "Merger Agreement"), shall constitute a Change in Control.
1.5 "Code" shall mean the Internal Revenue Code of 1986, as it may
be amended from time to time.
1.6 "Company" shall mean Red Roof Inns, Inc., a Delaware
corporation.
1.7 "Effective Date" shall mean July 10, 1999.
1.8 "Employee" shall mean any person who, immediately prior to a
Change in Control, is employed by the Company on a full-time or part-time
basis, including salaried, hourly and commission-based employees. No
person who is employed on a seasonal, temporary, or contract basis shall be
considered an Employee under the Plan.
1.9 "ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as it may be amended from time to time.
1.10 "Good Reason" shall mean the occurrence, after a Change in
Control, of either of the following acts or omissions: (i) the Company's
seeking to move the Employee's place of employment more than 50 miles from
the Employee's place of employment immediately prior to the occurrence of
the Change in Control; or (ii) a reduction by the Company of the Employee's
base salary, benefits (including but not limited to health, welfare,
retirement and vacation), bonus opportunity, other compensation or title or
an adverse change (increase or decrease) in the nature or scope of the
Employee's authorities, powers, functions, responsibilities, reporting
relationships or duties (collectively, the "Job Specifications") from the
Job Specifications in effect immediately prior to the occurrence of the
Change in Control.
1.11 "Plan Administrator" shall mean the Benefits Administration
Committee of the Company or its successor, as determined by the Board.
1.12 "Release Date" shall mean, for an Employee who does not have
a Severance Agreement, the first date on which the release referred to in
Section 2.4 below is no longer revocable by a particular Severed Employee.
For an Employee who does have a Severance Agreement, "Release Date" shall
mean that Employee's Severance Date.
1.13 "Salary" shall mean:
(a) for Employees who are compensated on a salary or commission basis
(or a combination thereof), the sum of (i) (x) the greater of the
quoted annual base salary rate in effect immediately prior to the
Change in Control or on the Severance Date divided by (y) 52; plus
(ii) (x) the greater of the commissions earned for the 52-week
period ending immediately prior to the Change in Control or
immediately prior to the Severance Date less, in each case, the
amount of any draw forgiven pursuant to Section 2.1(c) hereof,
divided by (y) 52; and
(b) with respect to an hourly Employee, the greater of the quoted
hourly rate in effect immediately prior to (i) the Change in
Control or (ii) the Severance Date, multiplied by the average
number of hours worked per week during the 52 weeks immediately
preceding the Change in Control (or the Severance Date, as
applicable); provided, however, that such average number of hours
per week may not exceed 40.
1.14 "Salary Grade" shall mean the greater of an Employee's salary
grade as established under the Company's compensation system immediately
prior to the occurrence of a Change in Control or immediately prior to the
Employee's Severance Date.
1.15 "Severance" shall mean the termination of an Employee's
employment with the Company within two years following a Change in Control
either (i) by the Company for any reason other than for Cause, or (ii) by
the Employee for Good Reason. An Employee will not be considered to have
incurred a Severance if his or her employment is discontinued by reason of
the Employee's death or a physical or mental condition causing the Employee
to be unable to substantially perform his or her duties with the Company
for more than six (6) continuous months, including, without limitation,
such condition entitling him or her to benefits under any sick pay or
disability income policy or program of the Company, provided that such
Employee otherwise would be eligible for such leave of absence or
disability benefits under the Company's standard plans, policies and
procedures therefor as in effect immediately prior to the Change in
Control.
1.16 "Severance Date" shall mean the date on or after a Change in
Control on which an Employee incurs a Severance.
1.17 "Severance Benefits" shall mean payments and benefits
provided to eligible Employees pursuant to Sections 2.1 through 2.6 hereof.
1.18 "Severance Period" shall mean
(i) with respect to Employees in Salary Grades 15 and above, the
greater of (A) 20 weeks, or (B) the sum of:
8 weeks, plus
2 weeks for each Year of Service, for the 1st through 5th
Years of Service, plus
3 weeks for each Year of Service, for the 6th through 10th
Years of Service, plus
4 weeks for each Year of Service, for the 11th and subsequent
Years of Service
(ii) with respect to Employees in Salary Grades 12, 13 and 14, the
greater of (A) 16 weeks, or (B) the sum of:
8 weeks, plus
2 weeks for each Year of Service, for the 1st through 5th
Years of Service, plus
3 weeks for each Year of Service, for the 6th through 10th
Years of Service, plus
4 weeks for each Year of Service, for the 11th and subsequent
Years of Service
(iii) with respect to Employees in Salary Grades 11 and below, the
greater of (A) 8 weeks, or (B) the sum of:
4 weeks, plus
1 week for each Year of Service
The Severance Period of any Severed Employee who has been employed by the
Company for a Year of Service that is less than a full Year of Service (a
"Partial Year") shall include the number of weeks that would have been
attributable to that Partial Year if the Severed Employee has been employed
for the full Year of Service, multiplied by a fraction, the numerator of
which is the number of days during the Partial Year during which the
Severed Employee was an Employee of the Company and the denominator of
which is 365.
1.19 "Severed Employee" shall mean an Employee who has incurred a
Severance.
1.20 "Year of Service" with respect to a Severed Employee shall
mean the aggregate number of years (including fractions thereof) that such
Severed Employee was employed by the Company prior to the Severance Date.
SECTION 2. Benefits.
2.1 Subject to Section 2.7 hereof, no later than 5 business days
following a Severed Employee's Severance Date, the Severed Employee shall
be entitled to receive a lump sum payment in respect of all earned but
unused vacation days through the Severance Date. In addition, (a) the
Company's 401(k) Retirement Plan shall be deemed to be partially terminated
as to that Employee and, in accordance with Section 10.2(b) of such plan,
the Severed Employee's account shall become fully vested and nonforfeitable
as of the Severance Date, (b) the Severed Employee's account, if any, in
the Company's Deferred Compensation and Executive Deferred Compensation
Plan shall become fully vested and nonforfeitable as of the Severance Date
and (c) if the Severed Employee is a commission-based employee with a draw,
any outstanding balance owed to the Company by the Severed Employee as of
that Employee's Release Date shall be forgiven as of such date.
2.2 Subject to Section 2.7 hereof, each Severed Employee shall be
entitled to receive a lump sum payment within 5 business days following the
Severed Employee's Release Date equal to the Employee's Bonus, multiplied
by a fraction, the numerator of which shall be the number of days during
the year in which the Severance occurred through the Severance Date and the
denominator of which shall be 365; provided, however, that a Severed
Employee who is a participant in the Company's 1999 Management Incentive
Plan (the "MIP") as of the Effective Date and whose Severance Date occurs
during 1999 shall be entitled to receive a lump sum payment within 5
business days following the Severed Employee's Release Date equal to the
sum of:
(a) the bonus that the Employee would have earned under the MIP with
respect to fiscal 1999, assuming that the Employee had earned the
maximum bonus thereunder, multiplied by a fraction, the numerator
of which shall be the number of days during 1999 up to and
including the date on which the Change in Control occurs plus 30,
and the denominator of which is 365; and
(b) the bonus that the Employee would have earned under the annual
bonus plan of the Company in which the Employee is eligible to
participate with respect to the portion of 1999 following the
consummation of the Offer, assuming that the Employee had earned
the maximum bonus thereunder, multiplied by a fraction, the
numerator of which is the number of days following the consummation
of the Offer up to and including the Severance Date minus 30, and
the denominator of which is the number of days in 1999 following
consummation of the Offer minus 30.
2.3 (a) Subject to Section 2.7 hereof, each Severed Employee
shall be entitled to receive an amount (the "Severance Amount") equal to
his or her Salary multiplied by the number of weeks (including fractional
weeks) during the Severance Period. The Severance Amount shall be paid to
such Severed Employee, at the election of the Severed Employee, either (i)
in a lump sum payment within 5 business days following the Severed
Employee's Release Date or (ii) in substantially equal installments over a
period equal to the Severance Period commencing as soon as practicable
following the 5th business day following the Severed Employee's Release
Date, based upon the Company's regular payroll practice. The Severance
Amount shall not be taken into account for purposes of determining benefits
under any other qualified or nonqualified plans of the Company.
(b) If an Employee who was compensated wholly or partly on a
commission basis is responsible for earnings paid to the Company within
ninety (90) days after that Employee's Severance Date that are attributable
to a franchise application actually received by the Company prior to that
Employee's Severance Date, that Employee shall be entitled to receive the
commission that otherwise would have been due on such earnings had that
Severed Employee been an Employee on the date of the Company's receipt of
such earnings. Subject to Section 2.7 hereof, any such commission paid to
a Severed Employee shall be accompanied by a payment of the difference
between the Severance Amount previously calculated for that Severed
Employee and the Severance Amount that would have been calculated had the
commission then being paid been included in the previous calculation of
that Severed Employee's Severance Amount.
2.4 Subject to Section 2.7 hereof and, except to the extent set
forth in the last sentence of Section 2.7 hereof, subject to the Severed
Employee's executing and not revoking a release substantially in the form
of Exhibit A hereto, effective as of the date immediately following the
Severed Employee's Severance Date and continuing for the period set forth
below (the "Welfare Benefit Continuation Period"), the Company shall
provide such Severed Employee and anyone entitled to claim under or through
such Severed Employee, at the Company's sole expense, with the same
benefits (including but not limited to medical, dental, short term
disability, long term disability and life insurance benefits) as were
provided immediately prior to the Severance Date or, if more favorable to
the Severed Employee, as were provided to that Employee (and in which that
Employee was a participant) immediately prior to the Change in Control. To
the extent that the Severed Employee's participation in Company benefit
plans is not practicable, the Company shall arrange to provide at the
Company's sole expense, the Severed Employee and anyone entitled to claim
under or through such Severed Employee with equivalent benefits under an
alternate arrangement. The benefits provided pursuant to this Section 2.4
shall continue beyond the Welfare Benefit Continuation Period with respect
to claims (including but not limited to long term disability claims)
arising out of events which occur during or prior to the Welfare Benefit
Continuation Period, subject to and in accordance with the provisions of
the applicable plan. The coverage period for purposes of the group health
and dental continuation requirements of section 4980B of the Code shall
commence at the expiration of the Welfare Benefit Continuation Period. For
purposes of this Section 2.4, the Welfare Benefit Continuation Period shall
be the lesser of (a) the period following that Employee's Severance Date
during which that Employee is not eligible to receive welfare benefits from
another employer and (b)(i) for Employees in Salary Grades 12 and above, 6
months and (ii) for Employees in Salary Grades 11 and below, 3 months.
2.5 Subject to Section 2.7 hereof, following a Severed Employee's
Severance Date, the Severed Employee shall be entitled to receive
appropriate outplacement assistance from the Company through a third-party
outplacement agency or other service that is reasonably appropriate to that
employee's functional area and level of authority, as determined under
rules promulgated by the Plan Administrator. Severed Employees in Salary
Grades 15 and above will be provided a 6 month, maximum $7,000 outplacement
program. Severed Employees in Salary Grades 9 though 14 will be provided a
90 day, maximum $4,500 outplacement program. Severed Employees in Salary
Grades 8 and below will be provided outplacement assistance no less
favorable than the Company's outplacement assistance practice immediately
prior to the Change in Control. In lieu of receiving such outplacement
assistance from the Company, Severed Employees in Salary Grades 9 and above
may elect to receive a lump sum payment within 5 business days following
the applicable Release Date equal to the maximum value of the outplacement
assistance that the Severed Employee is entitled to receive under this
Section 2.5, less the amount of any draw forgiven pursuant to Section
2.1(c) hereof. Moreover, a Severed Employee who is entitled to receive
outplacement assistance from the Company pursuant to the terms of a
Severance Agreement may elect to receive, in lieu of such outplacement
assistance, and in lieu of any benefit under this Section 2.5, a lump sum
payment within 5 business days following the applicable Release Date equal
to the maximum value of the outplacement assistance that the Severed
Employee is entitled to receive under such Severance Agreement, less the
amount of any draw forgiven pursuant to Section 2.1(c) hereof.
2.6 The Company will pay to each Employee all reasonable legal
fees and expenses incurred by such employee who seeks in good faith to
obtain or enforce any right or benefit provided under this Plan. In no
event shall a Severed Employee's execution and delivery of a release
pursuant to this Plan or any Severance Agreement waive, release or
otherwise impair that Severed Employee's right to enforce such Severed
Employee's rights under this Plan or such Severance Agreement unless the
release expressly so provides.
2.7 If an Employee is a party to a severance agreement with the
Company (including but not limited to an Executive Severance Agreement or
an employment agreement or letter with severance provisions) (each, a
"Severance Agreement"), then this Plan shall not affect such Employee's
entitlement to benefits thereunder; provided however, that the Severed
Employee shall be entitled to receive, on an item-by-item basis, the
greater of (a) the benefits specified under the Severance Agreement or (b)
the benefits specified in Sections 2.1 through 2.6 hereof. Except as
provided in the last sentence of this Section 2.7, as a condition to
receiving benefits under the Plan, a Severed Employee must execute a
release substantially in the form annexed hereto as Exhibit A. Any
Employee not executing, or subsequently revoking, such release shall not be
eligible for any benefits under the Plan. Notwithstanding any other
provision of the Plan, for Employees who have a Severance Agreement, unless
such Employee's Severance Agreement expressly requires that Employee to
execute and deliver a release in consideration of the Employee's rights
under such agreement, that Employee shall be entitled to receive the
benefits contemplated in Sections 2.1 through 2.7 of this Plan without
execution or delivery of the release attached hereto as Exhibit A.
2.8 In the event of a claim by an Employee as to the amount or
timing of any payment or benefit under the Plan, such Employee shall
present the reason for his or her claim in writing to the Plan
Administrator. The Plan Administrator shall, within thirty (30) days after
receipt of such written claim, send a written notification to the Employee
as to its disposition. In the event the claim is wholly or partially
denied, such written notification shall (a) state the specific reason or
reasons for the denial, (b) make specific reference to pertinent Plan
provisions on which the denial is based, (c) provide a description of any
additional material or information necessary for the Employee to perfect
the claim and an explanation of why such material or information is
necessary, and (d) set forth the procedure by which the Employee may appeal
the denial of his or her claim. In the event an Employee wishes to appeal
the denial of his or her claim, he or she may request a review of such
denial by making application in writing to the Plan Administrator within
thirty (30) days after receipt of such denial. Such Employee (or his or
her duly authorized legal representative) may, upon written request to the
Plan Administrator, review any documents pertinent to his or her claim, and
submit in writing issues and comments in support of his or her position.
Within thirty (30) days after receipt of a written appeal (unless special
circumstances, such as the need to hold a hearing, require an extension of
time, but in no event more than thirty (30) days after such receipt), the
Plan Administrator shall notify the Employee of the final decision. The
final decision shall be in writing and shall include specific reasons for
the decision, written in a manner calculated to be understood by the
claimant, and specific references to the pertinent Plan provisions on which
the decision is based.
2.9 Notwithstanding any other provision of this Plan, the Company
shall use reasonable efforts to provide each Employee with two (2) weeks'
prior written notice of the Company's intention to terminate such
Employee's employment, provided however, that the Company's failure to
provide such notice to any Severed Employee shall not give that Severed
Employee the right to continue employment or otherwise postpone that
Severed Employee's Severance Date beyond the date established by the
Company, in the Company's sole discretion.
SECTION 3. PLAN ADMINISTRATION.
3.1 The Plan shall be interpreted, administered and operated by
the Plan Administrator, which shall have complete authority, subject to the
express provisions of the Plan, to interpret the Plan and to make all
determinations necessary or advisable for the administration of the Plan.
3.2 All questions of any character whatsoever arising in
connection with the interpretation of the Plan or its administration or
operation shall be submitted to and settled and determined by the Plan
Administrator in an equitable and fair manner in accordance with the
procedure for claims and appeals described in Section 2.8.
3.3 The Plan Administrator may delegate any of its duties
hereunder to such person or persons from time to time as it may designate.
3.4 The Plan Administrator is empowered, on behalf of the Plan, to
engage accountants, legal counsel and such other personnel as it deems
necessary or advisable to assist it in the performance of its duties under
the Plan. The functions of any such persons engaged by the Plan
Administrator shall be limited to the specified services and duties for
which they are engaged, and such persons shall have no other duties,
obligations or responsibilities under the Plan. Such persons shall
exercise no discretionary authority or discretionary control respecting the
management of the Plan. All reasonable expenses thereof shall be borne by
the Company.
SECTION 4. PLAN MODIFICATION.
The Plan may be amended only by the unanimous vote of the Board at
any time; provided, however, that no such amendment may adversely affect
the rights of any Severed Employee or may otherwise be adverse to the
interests of any Employee. If the Plan is amended, the Company shall
provide each Employee and each Severed Employee who continues to
participate in the Plan with written notice of such amendment within ten
(10) business days thereafter.
SECTION 5. GENERAL PROVISIONS.
5.1 The Plan shall be effective as of the Effective Date and shall
terminate upon the second anniversary of a Change in Control; provided,
that the rights of any Severed Employee whose Severance occurs on or prior
to the second anniversary of a Change in Control shall not be adversely
affected by the termination of the Plan.
5.2 Except as otherwise provided herein or by law, none of the
payments, benefits or rights of any Employee shall be subject to any claim
of any creditor, and, in particular, to the fullest extent permitted by
law, all such payments, benefits and rights shall be free from attachment,
garnishment, trustee's process, or any other legal or equitable process
available to any creditor of such Employee. No Employee shall have the
right to alienate, anticipate, commute, pledge, encumber or assign any of
the benefits or payments which he or she may expect to receive,
contingently or otherwise, under this Plan.
5.3 Neither the establishment of the Plan, nor any modification
thereof, nor the creation of any fund, trust or account, nor the payment of
any benefits shall be construed as giving any Employee, or any person
whomsoever, the right to be retained in the service of the Company, and all
Employees shall remain subject to discharge to the same extent as if the
Plan had never been adopted.
5.4 If any provision of this Plan shall be held invalid or
unenforceable, such invalidity or unenforceability shall not affect any
other provisions hereof, and this Plan shall be construed and enforced as
if such provisions had not been included. If any provision of the Plan is
held to be invalid or unenforceable, the Company shall provide each
Employee and each Severed Employee who continues to participate in the Plan
with written notice of such event within ten (10) business days thereafter.
5.5 This Plan shall be binding upon the heirs, executors,
administrators, successors and assigns of the parties, including each
Employee, present and future, and any successor to the Company.
5.6 The headings and captions herein are provided for reference
and convenience only, shall not be considered part of the Plan, and shall
not be employed in the construction of the Plan.
5.7 The Plan shall not be funded. No Employee shall have any
right to, or interest in, any assets of the Company which may be applied by
the Company to the payment of benefits or other rights under this Plan.
5.8 Any benefit payable to or for the benefit of a minor, an
incompetent person or other person incapable of giving a receipt therefor
or executing a release substantially in the form of Exhibit A hereto shall
be deemed paid when paid to such person's guardian or to the party
providing or reasonably appearing to provide for the care of such person
(and such person shall be required to execute a release substantially in
the form of Exhibit A, but only to the extent that the Severed Employee
would have been so required), and such payment shall fully discharge the
Company, the Plan Administrator and all other parties with respect thereto.
If a Severed Employee dies prior to the payment of all benefits due such
Severed Employee, such unpaid amounts shall be paid to the executor,
personal representative or estate of such Employee.
5.9 Any notice or other communication required or permitted
pursuant to the terms hereof shall have been duly given when delivered or
mailed by United States mail, first class, postage prepaid, addressed to
the intended recipient at his, her or its last known address.
5.10 This Plan shall be construed and enforced according to the
laws of the State of Ohio, without giving effect to its principles of
conflicts of law, to the extent not preempted by federal law, which shall
otherwise control.
EXHIBIT A
RELEASE AGREEMENT
In consideration of the payments and benefits provided for in the
annexed Red Roof Inns, Inc. Change in Control Severance Plan dated as of
July 10, 1999 (the "Plan"), and the release from [employee's name]
("Employee") set forth herein, Red Roof Inns, Inc. (the "Company") and
Employee agree to the terms of this Release Agreement.
1. Employee acknowledges and agrees that the Company is under no
obligation to offer Employee the payments and benefits set forth in the
annexed Plan, unless Employee consents to the terms of this Release
Agreement. Employee further acknowledges that he/she is under no
obligation to consent to the terms of this Release Agreement and that
Employee has entered into this agreement freely and voluntarily.
2. Employee voluntarily, knowingly and willingly releases and
forever discharges the Company, its parents, subsidiaries and affiliates,
together with their respective officers, directors, partners, shareholders,
employees and agents, and each of their predecessors, successors and
assigns (collectively, "Releasees"), from any and all charges, complaints,
claims, promises, agreements, controversies, causes of action and demands
of any nature whatsoever that Employee or his/her executors,
administrators, successors or assigns ever had, now have or hereafter can,
shall or may have against Releasees by reason of any matter, cause or thing
whatsoever arising prior to the time of signing of this Release Agreement
by Employee. The release being provided by Employee in this Release
Agreement includes, but is not limited to, any rights or claims relating in
any way to Employee's employment relationship with the Company, or the
termination thereof, or under any statute, including the federal Age
Discrimination in Employment Act of 1967, Title VII of the Civil Rights Act
of 1964, the Civil Rights Act of 1990, the Americans with Disabilities Act
of 1990, the Employee Retirement Income Security Act of 1974, the Family
and Medical Leave Act of 1993, the Ohio Civil Rights Act, each as amended,
any other federal, state or local law or judicial decision.
3. Employee acknowledges and agrees that he/she shall not,
directly or indirectly, seek or further be entitled to any personal
recovery in any lawsuit or other claim against the Company or any other
Releasee based on any event arising out of the matters released in
paragraph 2.
4. In consideration of Employee's release set forth in paragraph
2, the Company knowingly and willingly releases and forever discharges
Employee from any and all charges, complaints, claims, promises,
agreements, controversies, causes of action and demands of any nature
whatsoever that the Company now has or hereafter can, shall or may have
against him/her by reason of any matter, cause or thing whatsoever arising
prior to the time of signing of this Release Agreement by the Company,
provided, however, that nothing herein is intended to release any claim the
Company may have against Employee for any illegal conduct.
5. Employee acknowledges that the Company has advised him/her to
consult with an attorney of his/her choice prior to signing this Release
Agreement. Employee represents that, to the extent he/she desires, he/she
has had the opportunity to review this Release Agreement with an attorney
of his/her choice.
6. Employee acknowledges that he/she has been offered the
opportunity to consider the terms of this Release Agreement for a period of
at least forty-five (45) days, although he/she may sign it sooner should
he/she desire. Employee further shall have seven additional days from the
date of signing this Release Agreement to revoke his/her consent hereto by
notifying, in writing, [ ]. This Release
Agreement will not become effective until seven days after the date on
which Employee has signed it without revocation.
___________________________
[Employee Name]
____________________________
[Company official]
[Red Roof Inns, Inc.]
Schedule To Release Agreement
Background Information
Severance payments and benefits as described in the Red Roof Inns,
Inc. Change in Control Severance Plan are being made available to all
employees of Red Roof Inns, Inc. (the "Company") employed in the Company's
Central Corporate Office and whose employment is being terminated in a
reduction in the work force taking place during the period [two years
following a Change in Control].
Eligibility Factors: none other than inclusion in the above
referenced reduction in force.
Time Limits Applicable: severance payments and benefits must be
elected within 45 days of the eligible individual's receipt of the annexed
agreement.
The chart that is included on the following page provides the job
title and age of each employee eligible for payments and benefits under the
Red Roof Inns, Inc. Change in Control Severance Plan, as well as the ages
of all individuals in the same job classification and organizational unit
who are not eligible.
ORGANIZATIONAL UNIT
Company Central Corporate Office
Title Ages of Eligible Employees Ages of Ineligible Employees
----- -------------------------- ----------------------------
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
**** **** ****
