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Collective Bargaining Agreement

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EXHIBIT 10.6


Capitol Plaza Holiday Inn H.E.R.E. Local 49 300 J Street 1824 Tribute Road, Suite D Sacramento, CA 95814 Sacramento 446-0100 564-4949 or 1-800-HOTEL-49
Medical & Dental: 921-3388
or 1-800-562-9383


June 1, 1998 through May 31, 2001


Section 1. Recognition Section 2. Union Representative's Activities/Shop Stewards Section 3. Types of Employees Section 4. Reporting Pay Section 5. Work Schedules Section 6. Discrimination and Equal Pay Section 7. Meals and Rest Periods Section 8. Work Day, Week, and Overtime Section 9. Vacations and Leaves of Absence Section 10. Holidays and Well Days Section 11. Funeral & Jury Duty Leave Section 12. Medical and Dental Plans Section 13. Pension Section 14. Contributions and Collections Section 15. Superior Workers and Premium Pay Section 16. Combination Jobs Section 17. Disciplinary Actions Section 18. No Strike and No Lockout Section 19. House Cards and Union Buttons Section 20. Union Security Section 21. Employer's Operation Section 22. Grievance Procedures Section 23. Arbitration Section 24. Dues and Fees Check-off Section 25. Worker's Compensation Section 26. Management Rights Reserved Section 27. Seniority Section 28. Terms, Terminations, and Amendments Section 29. Craft Rules, Regulations, and Working Conditions Section 30. Wage Scales Section 31. Signatures


Note: Wherever a masculine pronoun occurs in this document, it shall be understood to include the feminine pronoun.


COLLECTIVE BARGAINING AGREEMENT 6-1-98 to 5-31-01


THIS AGREEMENT, hereinafter called the contract, entered into this day of 1999, at Sacramento, California, by and between the Hotel Employees and Restaurant Employees Union Local 49, AFL-CIO, hereinafter known as the Union, and Holiday Inn - Capitol Plaza Sacramento, hereinafter designated as Employer.


In the event any portion of this contract is invalidated by the passage of legislation or by the rendition of a decision by a court of last resort, such invalidation shall apply only to those portions thus invalidated; and the remaining portions of this contract shall remain in full force and effect. If this occurs both parties shall meet within fifteen (15) calendar days for the purpose of renegotiating different provisions relative to the subject matter invalidated.


Section 1. RECOGNITION:


The Union shall be recognized as the sole bargaining agent for the purpose of collective bargaining for all employees coming under the jurisdiction of the Union, except employees excluded under any applicable Federal law.


Section 2. UNION REPRESENTATIVE'S ACTIVTIES/SHOP STEWARDS:


(a) Properly authorized representatives of the Union shall be permitted to investigate the standing of all employees and to investigate conditions to see that the contract is being enforced, provided that no interview shall be held during the rush hours, or unreasonably interrupt the duties of any employee. Authorized Union representatives shall inform the Employer or department head of their presence at the Hotel before interviewing employees.


(b) Shop Stewards


(1) The maximum number of Shop Stewards shall be three (3) Shop Stewards. It is understood that no more than one(l) Shop Steward shall be involved in the handling of any one particular grievance.


If any problem arises with the implementation of a Shop Steward system at the hotel, the parties agree to meet upon request of either party and work out mutually agreeable solutions to the problem.


(2) The Employer agrees to recognize Shop Stewards. Shop Stewards shall assist in the handling and/or investigation of grievances and may participate in all steps of the grievance procedure.


It is understood that during work time, if an employee requests the presence of a Shop Steward at a meeting where discipline may occur, the Shop Steward shall be allowed to leave his assigned job to attend such meeting. Shop Stewards may discharge their responsibilities at other times during their working hours only if prior approval is obtained from their immediate supervisor and there is no disruption in work. The Employer reserves the right to schedule grievance meetings during non-working hours of the Shop Steward. It is understood that Shop Stewards may cross departmental lines.


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(3) Shop Stewards shall receive training from the Union concerning their duties and responsibilities. In order to recognize Shop Stewards, the Union shall notify the Employer of the names of the trained and certified Shop Stewards.


(4) The Union may appoint or elect Shop Stewards. The election may be held on Employer's premises. It is understood that balloting will be conducted on the employee's own time and shall not cause disruption of the Hotel operations.


Section 3. TYPES OF EMPLOYEES:


(a) Full-time Employee: Any combination of shifts totaling thirty (30) hours or more in a five (5) day period (work week).


(b) Steady Part-time Employee: Any combination of shifts totaling less than thirty (30) hours in a five (5) day period (work week).


(c) Tipped Employee: Food and beverage servers, bus persons, bellpersons, bartenders, and valet parking attendants.


(d) Non-tipped Employee: All others not mentioned in Sub-Section (c) above.


Section 4. REPORTING PAY:


(a) When an Employer or his representative orders an employee to report for work or fails to notify an employee not to report for work for any reason and said employee is not allowed to work, the Employer shall pay the employee for one-half (1/2) of the shift called for but not less than four (4) hours minimum. This shall not apply to an employee under the influence of liquor or drugs. Employees scheduled to attend mandatory training/educational sessions shall be compensated at a two (2) hour minimum pay, or actual time spent, whichever is greater.


(b) Employees who are to be terminated must be notified at the end of their shift. If this is not done and they report for work the next regular work day and are not placed at work, they shall receive one-half (1/2) of their scheduled shift or four (4) hours minimum pay for so reporting.


Section 5. WORK SCHEDULES:


(a) The Employer shall post in a conspicuous place in each department, a work schedule specifying names and classifications, days off and starting and finishing time, which must be corrected weekly if need be. The weekly schedule should be posted by 12:00 noon on Thursday, to be effective 4:00 a.m. on Saturday.


(b) Except for Housekeeping Department Employees, regularly scheduled employees shall have a fixed starting time, which time shall not be changed by the Employer without giving a thirty-six (36) hour notice to the affected employee, except in case of need or emergency and by mutual consent.


It is further understood that:


1. All employee requests for a variance in a posted schedule will be
at the sole discretion of management.


2. All employee requests for a variance in scheduling must be
submitted before the schedule is posted and must be in writing.
Schedule variance requests will not be considered granted unless
signed as approved by the Department Head.


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The employee shall be responsible for keeping this written approval
in case of a dispute.


3. Seniority shall determine who has preference for a schedule
variance request if a conflict between employees arises before the
schedule is posted.


4. After posting of the work schedule, schedule variance requests, if
granted at all, will be to the first person to request the variance in
writing.


5. The scheduling procedures for the Housekeeping Department are
attached hereto as Addendum "B".


(c) Except as provided for in Section 4 (a), the minimum shift for all classifications will be for four (4) hours, except the Banquet Department which has a three (3) hour minimum shift.


(d) Split Shifts: Six (6) to eight (8) hours work within a spread of twelve (12) consecutive hours with only one (1) split shall constitute a split shift. Split shifts will be paid one (1) hour at the current minimum wage in addition to wages earned, in accordance with current I.W.C. regulations.


Section 6. DISCRIMINATION AND EQUAL PAY:


(a) There shall be no discrimination against any employee in accordance with all applicable State and Federal laws.


(b) The Union and the Employer agree the Employer shall be permitted to take all actions necessary to comply with the Americans With Disabilities Act. However, the Employer agrees that any accommodation made for an employee which conflicts with any term or provision of this contract shall first be discussed with the Union prior to its implementation. In any event, the only issue under this provision that may be subject to the grievance procedure is pursuant to the security provisions of this Contract.


Section 7. MEALS AND REST PERIODS:


(a) All meals furnished under this contract will be above and beyond the wage scales set forth in this contract and at no cost to the employee, except for any applicable State or Federal tax liability.


(b) Any employee working four (4) hours or more per day shall receive one (1) hot or one (1) cold meal of comparable quality to that served to the customer, excluding gourmet items.


(c) Any employee working a full shift shall be given an opportunity to eat a meal within not less than two (2) or more than five (5) hours from the commencement of the shift. This may be waived by mutual consent, but in no case will an employee be allowed to work more than five (5) hours without a meal break.


(d) In the event that employees are not permitted to eat in the dining room, they shall be provided with clean and sanitary facilities therefor, and be responsible for removing their own dishes, silverware, glassware, etc., to a proper station.


(e) Where one (1) hot or cold meal is required to be furnished, pursuant to this Section, and the employer fails to furnish such meal, he shall pay the employee one dollar and fifty cents ($1.50) for each meal not furnished. Employees who voluntarily do not eat the meal furnished by the Employer shall have no claim on the Employer for cash in lieu of that meal.


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(f) All employees shall be entitled to a ten (10) minute rest period for every four (4) hours worked or major portion thereof.


Section 8. WORK DAY, WEEK, AND OVERTIME:


(a) Seven and one-half (7 1/2) hours within eight (8) shall constitute an eight (8) hour shift and a day's work, except for bartenders, security, night auditors and graveyard housekeeping personnel. All of these employees shall be paid for all eight (8) hours of their eight (8) hour shift (includes their thirty (30) minute meal break).


(b) Any work performed in excess of an eight (8) hour shift shall be compensated at time and one-half (1 1/2) of the regular rate of pay for each major portion of each quarter (1/4) hour worked.


(c) Five (5) days in seven (7) consecutive days shall constitute a work week. Any work performed on the sixth (6th) or seventh (7) day of any seven (7) consecutive days shall be at time and one-half (1 1/2) of the regular rate of pay.


(d) A ten (10) hour, four (4) day, work week may be implemented by mutual agreement of the Union and the Employer, in a given classification.


(e) Except for Banquet Department employees, no employee shall be allowed to work more than one (1) shift in any one (1) calendar day. This shall not prohibit the performance of overtime work consecutive with the shift completed.


(f) Except for Banquet Department employees, eight (8) hours must elapse between any two (2) regular scheduled shifts. Should a period of eight (8) hours not elapse between the end of any one (1) regular scheduled shift and the beginning of the next regular scheduled shift, then overtime wages of one and one-half (1 1/2) of the regular rate of pay shall prevail. This shall not apply in case of emergency and with the mutual consent of both parties. This shall not apply to split shifts as defined under Section 5.


Section 9. VACATIONS AND LEAVES OF ABSENCE:


(a) Vacations with pay are hereby established for all employees. The period of service for the purpose of earning a vacation shall begin with the date of employment with this Employer and be calculated as follows:


After twelve (12) consecutive months he shall be entitled to one (1)
week's vacation with pay.
After twenty-four (24) consecutive months he shall be entitled to two
(2) weeks vacation with pay.
Effective January 1, 1999, after eight (8) consecutive years and
thereafter, he shall be entitled to three (3) weeks vacation with pay.
Effective January 1, 1999, after fifteen (15) consecutive years and
thereafter, he shall be entitled to four (4) weeks vacation with pay.


Vacations shall not be cumulative: i.e., they may not be accumulated from one twelve (12) month period (commencing with the anniversary date) to the next. Pay for unused vacation time shall be paid out on the employee's anniversary.


(b) Vacation pay shall be computed by the formula which follows. The earnings upon which the computation is made shall be the total sum earned during this period with the exception


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of banquet service charges and employee's declared tips, meals, premium holiday pay and bonuses.


Vacation Pay Computation


1st year - 2% of wages earned.
2nd through 7th year - 4% of wages earned.
8th through 14th year - 6% of wages earned.
15th completed year and thereafter - 8% of wages earned.


(c) For the purpose of pro-rating vacations for all employees, who quit or are terminated and who have served more than six (6) months shall on termination of employment be compensated in lieu of vacation as follows:


Vacation Pay Upon Termination


6 months and up to 12 months - 2% of wages earned.
13 months through 7th year - 4% of wages earned.
8th year through 14th year - 6% of wages earned.
15th completed year and thereafter - 8% of wages earned.


(d) Temporary layoffs or leaves of absence for non-medical reasons, not exceeding the following schedule, shall not interrupt continuity of employment for the purpose of vacation eligibility:


1. During the first year of employment - 30 days.
2. During the second and subsequent years of employment - 45 days.
3. Those employees with three or more years of seniority shall be
entitled to a leave of absence of up to six (6) months.
4. These time periods shall not be cumulative.
5. The Employer shall grant eligible employees family care leaves as
required by the Federal Family and Medical Leave Act and California
Family Care Act. The Union and the Employer agree that this contract
shall be interpreted to be consistent with these State and Federal
Laws.


(e) During each November, sign up sheets will be posted for vacation selection. During that month, employees will have the option of choosing a vacation period in the following calendar year. If two (2) or more employees request the same time period for vacation, and all cannot be granted that period, hotel seniority shall determine who will get that time period. If at the end of November, an employee fails to schedule a vacation time period, the Employer shall have the right to schedule that employee for vacation time off. Unless there is a serious verifiable emergency, any employee who has been given or selected a given vacation period may not request a change in said vacation period unless at least fourteen (14) calendar days advance written notice is given. In all cases granting of variances is at the sole discretion of the Employer. Black-out


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periods, where no vacation will be granted, are at the sole discretion of the Employer. However, if business allows, the Employer has the option of releasing any of that time for vacations.


(f) Employees shall be entitled to one (1) additional week without pay to follow consecutively after their paid vacation. The employee must request this additional time off at the same time as they request their vacation pay; 45 calendar days in advance of the start of their vacation.


(g) The employee will be paid their vacation pay within thirty (30) calendar days prior to the start of their vacation by means of the regular payroll period. However, employees must fill out a vacation pay request forty-five (45) calendar days prior to the start of their vacation for this to be guaranteed. If after so doing this, the Employer fails to have the vacation pay included in the regular pay period check, a separate check will be issued for that vacation pay prior to the start of the vacation.


(h) The Employer will pay Medical, Dental and Pension payments for said vacation time on the same hours as if the employee actually worked. This will not apply to terminated employees.


Section 10. HOLIDAYS AND WELL DAYS:


(a) The following days shall be observed as holidays:
New Year's Day (January 1)
President's Day (3rd Monday in February)
Memorial Day (last Monday in May)
Independence Day (July 4th)
Labor Day (1st Monday in September)
Thanksgiving Day (4th Thursday in November)
Christmas Day (December 25th)


Any work performed on such days shall be paid for at time and one-half (1 1/2) the regular rate of pay. If an employee does not work on a holiday, said employee is not entitled to holiday pay.


(b) Any non-tipped employee working on a holiday which is also their sixth (6th) or seventh (7th) consecutive day of work will be compensated at two (2) times the regular rate of pay.


(c) After one (1) year of continuous employment (including approved medical leave of absence and vacation time) any employee who has also qualified for medical, dental, and pension benefits will be entitled to paid well days in accordance with the following schedule:


Effective: 1-1-99
------
Employment # of Days
---------- ---------
1 Year 1
2 Years 2
3 Years 5
4 Years 6
5 Years or more 7


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(d) Well days may be used to cover a day off for illness or injury, and the Employer cannot demand a doctor's report unless that day is a holiday, or immediately prior to or after a holiday, the vacation period, or regularly scheduled days off. Other than this type of medical emergency, one week's notice must be given to the Employer to schedule a well day off. The Employer has the option to waive this advance notice. Well days may be taken off consecutively where applicable. Unused well days may accumulate to a maximum of eighteen (18) days. If currently over eighteen (18) days, the Hotel will pay off excess days.


Section 11. FUNERAL & JURY DUTY LEAVE:


(a) In the event of a death in the immediate family of an employee who has one (1) or more years of employment with this Employer, that employee shall be granted a leave of absence with pay not to exceed three (3) days. This provision does not apply if the funeral occurs during the employee's vacation, leave of absence, days off, lay off or sick leave. A day's pay shall be based upon an employee's normal work schedule.


(b) The immediate family shall mean only a (step) father, (step) mother, (step) brother, (step) sister, spouse, (step) child, (step) mother-in-law, (step) father-in-law, or (step) grandparent.


(c) Funeral leave applies only when the employee must make arrangements for the funeral and/or to attend the funeral. It is not applicable for other purposes, such as settling the estate, etc.


(d) The Employer may demand verification of the death and the relationship. The employee must notify his immediate shift supervisor as soon as possible of the death and his necessary absence from work.


(e) Funeral leave hours shall count toward Medical, Dental and Pension benefits calculations.


(f) Employees serving on jury duty shall retain their seniority, and the Employer will continue to make contributions for them to continue their Medical, Dental and Pension benefits on the same basis as their scheduled hours before that jury duty. In no event shall the Employer continue Medical, Dental and Pension benefits for more than thirty (30) calendar days per calendar year.


Section 12. MEDICAL AND DENTAL PLANS:


(a) The Sacramento Independent Hotel, Restaurant and Tavern Employees Welfare Plan is hereby established. The details of the Trust Fund and the Declaration of Trust dated the 1st day of April 1954 and the 1st day of August 1954, as executed by the parties hereto is hereby made a part of this contract. The Fund shall be administered by the Employers and the Union through a Board of Trustees. The Union recognizes the Sacramento HERE Employers' Association as the representative body to appoint and/or remove Management Trustees on said Board, provided said Association is legally constituted and approved by Employers representing a majority of employees who are participants in the Fund.


(b) Eligibility Requirements: In all cases, for an employee to be eligible for coverage he must work a minimum number of hours per calendar month commencing with the calendar month immediately following the calendar month of the date of hire as follows:


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All Employees........60 hours or more per calendar month.


For all purposes under this contract, the above are known as the "minimum required number of hours per calendar month." They must be worked for a single contributing Employer under this contract.


(c) Contributions: For each eligible employee the Employer shall contribute during the term of this contract the following sums per calendar month; January 1999 contributions are based upon December 1998 hours:


1. MEDICAL - Low Plan (Low Indemnity):
1-1-99 $84.00 This rate is for all new hires, for their
1-1-00 $88.00 first twelve (12) calendar months of
1-1-01 $92.00 employment including anyone hired during
the month of the 1999 ratification vote.


2. MEDICAL - High Plan (fully paid Kaiser or High Indemnity):
1-1-99 $119.00 This rate is for all employees who have
1-1-00 $129.00 completed twelve (12) calendar months
1-1-01 $139.00 of employment, or have been hired prior
to the month of the 1999 ratification vote.


3. During the term of this contract, PacifiCare HMO, or another equal value HMO will be offered as an alternative plan. Any employee may choose either Plan by completing the necessary paperwork within 30 days of hire or during the annual open enrollment. Those employees must then co-pay the difference between the PacifiCare premium, or its alternative, and the Employer's contribution each month through payroll deduction.


4. DENTAL: 4-1-99 1-1-00 1-1-01
------ ------ ------ All Employees, 60 hours or more.....$13.00......$14.00......$15.00


It is the desire and intent of the contracting parties to seek to preserve a sound financial reserve in the Trust Fund to adequately meet the needs of the participants of the Fund. Should depletions of the reserves occur in excess of what can be recovered, then the Trustees will modify benefits temporarily until such time as financially corrective measures can be taken.


(d) Contributions to the Fund for work performed shall be paid not later than the tenth (10th) day of the month following that in which such work is performed. Contributions to be made to the Administrator of the Fund on forms furnished to the Employer by the Fund showing name of the employee, social security account number of new employees, number of hours worked, the amount of contributions due, and such other information as required by the Trustees.


(e) It is hereby agreed that the Employer shall permit a confidential audit of payroll records by an authorized representative of the Medical Trust Fund to verify hours worked only.


(f) The Trustees of the Sacramento Independent Hotel, Restaurant and Tavern Employees Welfare Plan shall not be obligated to, and are not authorized to accept any


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contributions from an Employer under this Section of the contract unless the said Employer is currently a party to or bound by a current contract with the Hotel Employees and Restaurant Employees Union Local 49.


(g) The Employer agrees to pay up to two (2) months contributions per calendar year for Medical and Dental benefits for any qualified employee who is off work because of medical reasons. A qualified employee shall be deemed an employee who has been qualified under this section for twelve (12) months continuous service for this Employer.


(h) The schedule of benefits to be provided for each eligible employee and each covered dependent shall be determined by a majority of the Board of Trustees of said Fund.


(i) The Employer agrees to participate in an employee co-payment program for dependent coverage. The co-payment schedule is set by the Trust Fund, and the benefits provided shall be determined by the Trust Fund. The co-payments must be transmitted to the Trust Fund concurrent with the payments for the employee's coverage in order to maintain coverage. All of the conditions and penalties apply to co-payment coverage that apply to employee coverage as stated in this Section and the Contributions and Collections Section, as well as the decision of the Trustees of that Trust Fund.


(j) There will be an open enrollment period during the month of October. Employees shall pay by payroll deduction, and the Employer shall remit to the Fund each month its monthly contributions, the difference between the amount of monthly contributions paid by the Employer, as shown above, and the actual costs of providing the benefits of the Plans, as determined by the Trustees. For this purpose, the Employer shall provide for automatic and continuing payroll deduction. All employees participating in the Plan shall by this Contract be deemed to have granted the Employer authorization to withhold from their wages the amounts necessary to maintain coverage.


These deductions will continue for one (1) full year for those originally eligible.
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