MASTER TRANSACTION AGREEMENT by and among PARKWAY PROPERTIES, INC.; PARKWAY PROPERTIES LP; EOLA OFFICE PARTNERS LLC (“EOP”); EOLA CAPITAL LLC (“EOC”); and THE INDIVIDUALS LISTED ON THE SIGNATURE PAGE HERETO April 10, 2011
Exhibit 10.1
EXECUTION VERSION
by and among
PARKWAY PROPERTIES, INC.;
PARKWAY PROPERTIES LP;
EOLA OFFICE PARTNERS LLC (“EOP”);
EOLA CAPITAL LLC (“EOC”);
and
THE INDIVIDUALS LISTED ON THE SIGNATURE PAGE HERETO
April 10, 2011
TABLE OF CONTENTS
| Page | ||||
ARTICLE 1 DEFINITIONS |
1 | |||
1.1 Definitions |
1 | |||
ARTICLE 2 EXECUTIVE EMPLOYMENT WITH PARENT |
1 | |||
2.1 Appointment of Officers |
1 | |||
2.2 Compensation |
2 | |||
ARTICLE 3 ADDITIONAL COVENANTS |
5 | |||
3.1 Residual Obligations |
5 | |||
3.2 Employment Locations of Officers and Management |
5 | |||
3.3 Severance of Employees |
5 | |||
ARTICLE 4 HEADQUARTERS |
6 | |||
4.1 Headquarters |
6 | |||
ARTICLE 5 RIGHT OF FIRST OFFER |
6 | |||
5.1 Touzet Option Property |
6 | |||
5.2 Property Management Option |
8 | |||
5.3 Confidentiality |
9 | |||
5.4 Definitions |
9 | |||
ARTICLE 6 MISCELLANEOUS PROVISIONS |
10 | |||
6.1 Notices |
10 | |||
6.2 Entire Agreement |
10 | |||
6.3 Amendments and Waivers |
10 | |||
6.4 No Assignments |
10 | |||
6.5 Governing Law |
10 | |||
6.6 Jurisdiction and Venue |
10 | |||
6.7 WAIVER OF TRIAL BY JURY |
11 | |||
6.8 Binding Effect |
11 | |||
6.9 Severability |
11 | |||
6.10 Counterparts |
12 | |||
6.11 Third Parties |
12 | |||
6.12 Exhibits |
12 | |||
6.13 Time Periods |
12 | |||
Exhibits
Purchase and Sale Agreement Transactions |
A | |||
Initial Salaries, Cash Bonus and Equity Incentives |
B | |||
Change In Control Agreement |
C | |||
Form of Indemnification Agreement |
D | |||
Employment Locations |
E | |||
Non-Officer Employees Subject to Severance |
F-1 | |||
Form of Release |
F-2 |
This Master Transaction Agreement (this “Agreement”), dated as of April 10, 2011, is by and
among Eola Office Partners LLC, a Florida limited liability company (“EOP”), EOLA Capital LLC, a
Florida limited liability company (“EOC”), Parkway Properties, Inc., a Maryland corporation
(“Parent”), Parkway Properties LP, a Delaware limited partnership (“Partnership”), and each of the
individuals listed on the signature page to this Agreement (each, an “Executive” and collectively,
the “Executives”). EOP, EOC, Parent, Partnership, and the Executives are sometimes referred to
herein as the “Parties” and each, a “Party.”
WHEREAS, simultaneously with the execution and delivery of this Agreement, the Parties and
certain of their respective Affiliates are entering into the following other transaction agreements
(the “Related Agreements”): (i) a contribution agreement (the “Contribution Agreement”),
pursuant to which, among other things, (x) all of the membership interests of EOP will be
contributed to the Partnership, and (y) all of the membership interests of EOC owned by Banyan
Street Office Holdings LLC, a Florida limited liability company, will be contributed to the
Partnership (collectively, the “Contributions”); and (ii) purchase and sale agreements, pursuant to
which, among other things, Affiliates of Parent shall directly or indirectly purchase interests in
certain real property and improvements as listed on Exhibit A hereto (collectively, the
“Property Acquisitions” and, together with the
Contributions, the “Transactions”); and
WHEREAS, the Parties desire to enter into this Agreement to agree to certain terms and
conditions relating to the Transactions, which are not addressed in the Related Agreements.
NOW THEREFORE, the Parties acknowledge the adequacy and receipt of the consideration provided
to each through their respective representations, warranties, conditions, rights and promises
contained in this Agreement, and other good and valuable consideration, and intending to be legally
bound hereby, agree as provided below.
ARTICLE 1
DEFINITIONS
DEFINITIONS
1.1 Definitions. Capitalized terms used herein but not otherwise defined shall have
the meanings ascribed to such terms in the Contribution Agreement.
ARTICLE 2
EXECUTIVE EMPLOYMENT WITH PARENT
EXECUTIVE EMPLOYMENT WITH PARENT
2.1 Appointment of Officers.
2.1.1 Effective the later of (x) June 1, 2011 or (y) the Closing, Parent hereby agrees that
Xxxxx X. Xxxxxxxx shall be appointed as Executive Chairman of the Board of Parent and Xx. Xxxxxxxx
hereby agrees to accept such appointment and to serve in such capacity at the direction of the
Board of Directors of Parent. As the Executive Chairman of the Board of Parent, Xx. Xxxxxxxx shall
be entitled to observe all meetings of the investment committee of the Board.
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2.1.2 Effective immediately following the Closing, Parent hereby agrees that Xxxxx X.
Xxxxx, III shall be appointed as Executive Vice President and Head of Asset Management and Third
Party Services and Xx. Xxxxx agrees to accept such appointment and to serve in such capacity at the
direction of the Board of Directors of Parent.
2.1.3 The name and title of each other person that will serve as a member of Parent’s senior
management team upon Closing are set forth on Exhibit B hereto.
2.2 Compensation.
2.2.1 Salary. The initial annual base salaries, target cash bonuses and target equity
incentive compensation for Xx. Xxxxxxxx and Xx. Xxxxx and all other persons that will be serving as
a member of Parent’s senior management team following the Closing are set forth on Exhibit
B hereto. Each of Xx. Xxxxxxxx and Xx. Xxxxx understand and agree that any future annual
adjustments to the amounts set forth on Exhibit B and the amount of any actual bonuses and
equity or other compensation payable to such Executive will be determined by the Compensation
Committee of the Board of Directors of Parent (the “Compensation Committee”), in its sole
discretion; provided however that (i) the base salaries for Xx. Xxxxxxxx and Xx. Xxxxx shall not be
reduced below the initial base salary amounts listed on Exhibit B for periods of employment
from the Closing Date through December 31, 2012 and (ii) with respect to the cash bonuses payable
to Xx. Xxxxxxxx and Xx. Xxxxx with respect to the fiscal year ended December 31, 2011 only, such
Executive shall be entitled to the full amount of the target cash bonus amounts listed in
Exhibit B without regard to the achievement of any particular performance criteria,
prorated for the period from the Closing Date through December 31, 2011. Annual cash bonuses for
future years will be subject to such conditions as may be determined by the Compensation Committee.
The annual base salaries will be paid in equal bi-weekly amounts and will be prorated from the
Closing Date through December 31, 2011. The base salaries shall be payable on Parent’s regularly
scheduled payroll dates, after such deductions and withholdings as may be required by applicable
law. The payment of annual cash bonuses for each of Xx. Xxxxxxxx and Xx. Xxxxx shall be
contingent upon the Executive remaining employed by Parent on the bonus payment date, which bonus
payment date shall be paid concurrent with the bonus payment date for Parent’s other executive
officers who receive bonuses. The bonus payment date for 2011 bonuses is currently expected to be
in February 2012. The initial equity incentive compensation grants to each of Xx. Xxxxxxxx and Xx.
Xxxxx shall be granted under individual grant award agreements which shall contain terms that are
consistent with the terms and conditions of Parent’s 2010 Omnibus Equity Incentive Plan.
2.2.2 Benefits. During the period of their employment by Parent, Xx. Xxxxxxxx and
Xx. Xxxxx will be entitled to paid time off and holiday pay in accordance with Parent’s policies in
effect from time to time and will be eligible to participate in such employee benefit plans
currently, or hereafter made, available to executive officers of Parent, in accordance with and
subject to the terms and conditions of such plans; provided that, during the period from the
Closing Date through December 31, 2011, Xx. Xxxxxxxx and Xx. Xxxxx may, at Parent’s election,
continue to be eligible to participate in the employee benefit plans, programs and policies of EOC
or EOP, rather than of Parent, on a basis consistent with past practices. A summary of such
benefits currently in effect is set forth in Parent’s Employee Handbook, a copy of which has been
provided to each of Xx. Xxxxxxxx and Xx. Xxxxx.
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2.2.3
Change In Control Agreement; Indemnification Agreement.
| (a) | At Closing, Parent shall enter into a Change In Control Agreement with each of Xx. Xxxxxxxx and Xx. Xxxxx in the form attached as Exhibit C hereto. | ||
| (b) | At Closing, Parent shall enter into an Indemnification Agreement with each of the Executives in the form attached as Exhibit D hereto. |
2.2.4 Appointment of Directors. Effective the later of (x) June 1, 2011 or (y) the
Closing, Xx. Xxxxxxxx and Xx. Xxxxxx shall be appointed as directors of Parent to fill two (2)
newly created directorships of Parent and to serve as directors of Parent until the annual meeting
of stockholders of Parent to be held in May, 2012 (the “2012 Annual Meeting”). The Nominating
and Corporate Governance Committee of the Board of Directors of Parent, and the full Board of
Directors of Parent, have approved Xx. Xxxxxxxx as a nominee for re-election as a director of
Parent at the 2012 Annual Meeting and Parent agrees to nominate Xx. Xxxxxxxx for election as a
director at the 2012 Annual Meeting. Each of Xx. Xxxxxxxx and Xx. Xxxxxx agrees to serve as a
director of Parent effective as of the time described above, and Xx. Xxxxxxxx agrees to stand for
election as a director of Parent at the 2012 Annual Meeting and further agrees to provide to Parent
all information required by the rules and regulations of the Securities and Exchange Commission for
inclusion in Parent’s proxy statement with respect to the 2012 Annual Meeting. The Parties
understand and acknowledge that upon their appointment neither Xx. Xxxxxxxx nor Xx. Xxxxxx will be
considered independent directors of Parent. Each of Xx. Xxxxxxxx and Xx. Xxxxxx agree that he
will recuse himself from any discussion or action by the Board of Directors of Parent, or any
committee thereof, which involves a property in which either Xx. Xxxxxxxx or Xx. Xxxxxx holds a
direct or indirect ownership or other interest (other than discussions or decisions that relate to
property management matters generally) or any other matter in which Xx. Xxxxxxxx or Xx. Xxxxxx has
a conflict of interest, consistent with Parent’s Code of Business Conduct and Ethics, as in effect
from time to time.
2.2.5 No Employment Agreement: At-Will Employment. The Executives understand and
agree that no employee or officer of Parent has an employment agreement with Parent and this
Agreement is not intended to be, and shall not be construed as, an employment agreement as between
any Executive and Parent or any of Parent’s affiliates, or as otherwise conferring upon any
Executive any right to continued employment or any continuing monetary or other benefit, except to
the extent expressly provided in this Agreement. Parent’s employment of Xx. Xxxxxxxx and Xx. Xxxxx
is at will. Either Parent, Xx. Xxxxxxxx or Xx. Xxxxx may terminate such Executive’s employment at
any time for any or no reason, with or without Cause (as defined below) or notice.
2.2.6 Touzet Severance. The Parties acknowledge and agree that in connection
with the Transactions, Xx. Xxxxxx shall be terminated as an employee of EOP and/or EOC effective as
of the Closing Date and will not be employed by Parent or any of its Affiliates; provided that Xx.
Xxxxxx shall be entitled to severance pay in the aggregate amount of $1,892,502.13. Such severance
pay shall be paid, subject to applicable federal, state, and local taxes and withholding, in one
lump sum within thirty days following the Closing Date. For purposes hereof, termination of
employment shall mean a “separation from service” within the
3
meaning of Internal Revenue Code section 409A. Parent’s obligations under this
Section 2.2.6 shall be contingent upon receipt at Closing of a Release (as defined below)
from Xx. Xxxxxx.
2.2.7 Breach and Exclusive Remedy. In the event (i) of a breach of Sections 2.1.1,
2.2.1, 2.2.4 or 2.2.6 (as such obligations relate to Xx. Xxxxxxxx or Xx. Xxxxxx), which
breach Parent fails to cure within ninety (90) days following notice of such breach to Parent, or
(ii) that the employment of Xx. Xxxxxxxx with Parent is terminated by Parent for any reason other
than Cause, as defined below, (a “Lock-up Breach”), the sole and exclusive remedy of either Xx.
Xxxxxxxx or Xx. Xxxxxx shall be: (A) such event shall constitute a Principal Termination Event (as
defined in the Contribution Agreement) and Parent and Partnership shall be required to perform all
obligations set forth in each of Sections 3.6.1(f) and 3.6.2(f) of the Contribution Agreement, and
(B) each of Xx. Xxxxxxxx and Xx. Xxxxxx shall be fully released from his obligations under Article
I of that certain Lock Up and Voting Agreement dated April 10, 2011 (the “Voting Agreement”) by and
among Parent, the Partnership and the Executives (“Lock-up Release”). In the event of a breach of
Sections 2.1.2 or 2.2.1 of this Agreement by Parent, as such obligations relate to
Xx. Xxxxx, which breach Parent fails to cure within ninety (90) days following notice of such
breach to Parent, Xx. Xxxxx shall be fully released from his obligations under Article I of the
Voting Agreement (“Additional Lock-up Release”). Any Lock-up Release or Additional Lock-up Release
shall be effective as of the calendar day following the cure period permitted under this
Section 2.2.7, or with respect to a termination for any reason other than for Cause, as of
the effective date of such termination. For purposes of this Agreement “Cause” shall mean (i) the
continued failure by the Executive to perform material responsibilities and duties toward Parent
(other than any such failure resulting from the Executive’s incapacity due to physical or mental
illness), (ii) the engaging by the Executive in willful or reckless conduct that is demonstrably
injurious to Parent monetarily or otherwise, (iii) the conviction of the Executive of a felony,
(iv) the commission or omission of any act by the Executive that is materially inimical to the best
interests of Parent and that constitutes on the part of the Executive common law fraud or
malfeasance, misfeasance or nonfeasance of duty, (v) the failure of the Executive to comply with
the post-Closing covenants contained in Section 11.8.8 or the payment obligations under
Article 12 of the Contribution Agreement (unless the parties are engaged in a bona fide
dispute under such provisions), or (vi) the breach by the Executive of any material term of this
Agreement or the Voting Agreement, which continues after thirty (30) days’ notice by Parent to
Executive as to such breach; provided, however, that Cause shall not include the
Executive’s lack of professional qualifications. For purposes of this Agreement, an act, or failure
to act, on the Executive’s part shall be considered “willful” or “reckless” only if done, or
omitted, by the Executive not in good faith and without reasonable belief that the action or
omission was in the best interest of Parent. The Executive’s employment shall not be deemed to have
been terminated for Cause unless Parent shall have given or delivered to the Executive (A)
reasonable notice setting forth the reasons for Parent’s intention to terminate the Executive’s
employment for Cause, (B) a reasonable opportunity, at any time during the thirty (30)-day period
after the Executive’s receipt of such notice, for the Executive, together with the Executive’s
counsel, to be heard before the Board, and (C) a Notice of Termination (as defined below) stating
that, in the good faith opinion of not less than a majority of the entire membership of the Board,
the Executive was guilty of the conduct set forth in clauses (i), (ii), (iii), (iv) or (v) of the
first sentence of this Section 2.2.7. For purposes of this Agreement “Notice of
Termination” means a written notice that (i) indicates the specific termination provision in
this Agreement relied upon, (ii) sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for
4
termination of the Executive’s employment under the provision so indicated, and (iii) if
the date of termination is other than the date of receipt of such notice, specifies the
termination date (which date shall be not more than fifteen (15) days after the giving of such
notice).
ARTICLE 3
ADDITIONAL COVENANTS
ADDITIONAL COVENANTS
3.1 Residual Obligations. The Parties acknowledge that each of Xx. Xxxxxxxx, Xx.
Xxxxxx and Xx. Xxxxx will have continuing obligations to perform asset management and other
services and will continue to have other responsibilities (the “Outside Activities”) with respect
to and for the benefit of certain EOP-managed properties and EOC-managed properties that will not
be acquired as part of the Transactions (the “Excluded Assets”). The Parties agree that Xx.
Xxxxxxxx’x, Xx. Xxxxxx’x and Xx. Xxxxx’x continuation of the Outside Activities is permitted under
the terms of this Agreement and that the performance of such Outside Activities will provide
certain benefits to the Parent and the Partnership, as the property managers of the Excluded
Assets. Each of Xx. Xxxxxxxx, Xx. Xxxxxx and Xx. Xxxxx may continue to engage in such Outside
Activities so long as such responsibilities do not, materially and on a continuing basis, interfere
with the Executives’ employment or other obligations to Parent. In addition, Parent acknowledges
and agrees that the Board of Directors of Parent has authorized and approved the Outside Activities
to be performed by each of Xx. Xxxxxxxx and Xx. Xxxxxx and determined that such Outside Activities
do not violate Parent’s Code of Business Conduct and Ethics, Corporate Governance Guidelines or
similar policy of Parent, as in effect from time to time.
3.2 Employment Locations of Officers and Management. Exhibit E hereto sets forth the
job title and location of employment with Parent for each of the Persons listed therein.
3.3 Severance of Employees.
3.3.1 Each of the employees of EOP or EOC immediately prior to the Closing who are terminated
at or immediately prior to Closing as a result of the Contributions, a list of each such affected
persons being set forth on Exhibit F-1 hereto (each, other than Xx. Xxxxxx, an “Other
Employee” and collectively, the “Other Employees”) and who timely sign a release of claims in the
form attached as Exhibit F-2 hereto (a “Release”), will be entitled to receive severance
pay in the aggregate amount set forth opposite such person’s name as set forth on Exhibit
F-1 under the heading “Aggregate Severance Pay.”
3.3.2 All severance pay to the Other Employees will be paid, subject to applicable federal,
state, and local taxes and withholding, in a single lump sum within thirty (30) days following the
Closing Date.
3.3.3 Each employee of EOP or EOC immediately prior to the Closing (each, an “Additional
Terminated Employee” and, collectively, the “Additional Terminated
Employees”) who is terminated as a result of the Transactions within six (6) months following
the Closing Date, and who timely signs a Release, will be eligible for severance pay in the
aggregate amount of one month of base salary as in effect immediately prior to such Person’s
termination for every year of service with EOP or EOC, as applicable; provided that,
5
notwithstanding the foregoing, the maximum amount of severance payable to any
Additional Terminated Employee shall be twelve (12) months of base salary as in effect immediately
prior to such Person’s termination, and the minimum amount of severance shall be three (3) months
of such base salary. Such severance amount shall be paid, subject to applicable federal, state,
and local taxes and withholding, in a single lump sum within thirty (30) days following the
Additional Terminated Employee’s termination.
3.3.4 For purposes hereof, termination of employment shall mean a “separation
from service” within the meaning of Internal Revenue Code section 409A.
3.3.5 For purposes of this Agreement, any Employee who is terminated within six (6) months
following the Closing Date for any reason other than for Cause, shall be deemed to have been
terminated as a result of the Transactions and shall be eligible for the benefits set forth in this
Section 3.3. Any Employee who voluntarily resigns shall not be eligible for the benefits
set forth in this Section 3.3. Parent’s obligations with respect to any employee of EOP or
EOC under this Section 3.3 shall be contingent upon the timely receipt of the Release from
such terminated employee.
3.3.6 Notwithstanding any other provision of this Agreement, any Employee who is not listed on
Exhibit F-1, who is offered a comparable job with EOP, EOC or Parent following the Closing
and who does not accept such job shall not be eligible for severance pay or other benefits.
ARTICLE 4
HEADQUARTERS
HEADQUARTERS
4.1 Headquarters. At Closing, the principal executive offices of Parent shall remain
in Jackson, Mississippi, and a co-headquarters shall be located in Orlando, Florida.
ARTICLE 5
RIGHT OF FIRST OFFER
RIGHT OF FIRST OFFER
5.1 Touzet Option Property. On the terms and subject to the conditions set forth in
this Section 5.1, Xx. Xxxxxx hereby grants to Parent (or an Affiliate of Parent designated
by Parent in writing) a right of first offer with respect to any Touzet Option Property in
accordance with the terms and conditions set forth in this Article 5, during the twenty
four (24) month period beginning on the Closing Date (the “Option Period”). For purposes of this
Section 5.1, a “Touzet Option Property” means any parcel of real property (i) that
is an office building containing no less than 100,000 rentable square feet, (ii) that is located
in a Parkway Market (as defined below), and (iii) with respect to which a Touzet Purchaser has the
authority to acquire, and controls decision-making with respect to the acquisition of (including
transfer of the right to acquire) the fee simple interest in such parcel of real property;
provided that, for purposes of clarity, Touzet Option Property shall expressly exclude any Managed
Property. For purposes of this Section 5.1, “Touzet Purchaser” means any of (x) Xx.
Xxxxxx, individually, (y) an entity wholly-owned by Xx. Xxxxxx, and/or (z) an entity
partially-owned by Xx. Xxxxxx together with any third Person who is acting as a passive
co-investor in connection with any proposed fee simple acquisition of a Touzet Option Property.
6
5.1.1 In the event that any Touzet Purchaser desires to acquire fee simple title to any
Touzet Option Property at any time during the Option Period, then, prior to the delivery of an
offer by a Touzet Purchaser with respect to the fee simple acquisition of such Touzet Option
Property, Xx. Xxxxxx shall deliver to Parent a notice of the intent to send an offer to the
property owner of, or broker with respect to, such Touzet Option Property (an “Offer Notice”),
accompanied by a copy of such proposed offer.
5.1.2 Within five (5) business days following the delivery of an Offer Notice to Parent,
Parent shall notify Xx. Xxxxxx in writing if Parent desires to make such offer to the property
owner of, or broker with respect to, such Touzet Option Property on the same terms and conditions
as proposed to be made by the applicable Touzet Purchaser by delivery of written notice of such
election (an “Election Notice”). If Parent timely delivers an Election Notice, then Xx. Xxxxxx
shall use commercially reasonable efforts to assist Parent in submitting such offer to the property
owner. If Parent does not timely submit an Election Notice or declines in writing to submit such
offer, then Xx. Xxxxxx and/or the applicable Touzet Purchaser shall be deemed to have complied with
the obligations under Sections 5.1.1 and 5.1.2, and shall be entitled to submit such offer
to the property owner of, or broker with respect to, such Touzet Option Property.
5.1.3 In addition to complying with Sections 5.1.1 and 5.1.2, if applicable,
with respect to a Touzet Option Property, in the event that a Touzet Purchaser desires to acquire
fee simple title to a Touzet Option Property as to which no Election Notice was delivered by Parent
under Section 5.1.2 above or as to which an Election Notice was timely delivered by Parent
under Section 5.1.2 above but Parent subsequently determined to abandon the transaction, at
any time during the Option Period, then, prior to the execution of any letter of intent, memorandum
of understanding, purchase contract or similar document between any Touzet Purchaser and any
current property owner of a Touzet Option Property for the fee simple acquisition of such Touzet
Option Property (each, a “Purchase Document”), Xx. Xxxxxx shall deliver to Parent a notice of
intent to enter into a Purchase Document (a “Contract Notice”), together with a copy of such
proposed Purchase Document, including all available exhibits and schedules thereto, and provide
Parent with access to the offering and due diligence materials available to Xx. Xxxxxx (including,
without limitation, title, survey, environmental reports, loan information) with respect to the
Touzet Option Property.
5.1.4 Within five (5) business days following the delivery of a Contract Notice to Parent,
Parent shall notify Xx. Xxxxxx in writing if Parent desires to execute the applicable Purchase
Document on the terms and conditions set forth therein by delivery of written notice of such
election (a “Purchase Election Notice”). If Parent timely delivers a Purchase Election Notice,
then (i) Xx. Xxxxxx shall use commercially reasonable efforts (but without the requirement to make
any payment) to arrange for the applicable property owner of the Touzet Option Property to execute
the Purchase Document with Parent, or Parent’s designee, as substitute purchaser and otherwise take
all actions reasonably requested by Parent in connection therewith, and (ii) Parent shall reimburse
Xx. Xxxxxx or the Touzet Purchaser for all reasonable and documented out-of-pocket costs and
expenses (including reasonable attorneys’ fees and deposits) incurred by the Touzet Purchaser in
connection with the potential acquisition of the Touzet Option Property within five (5) business
days of Xx. Xxxxxx’x submission of an invoice and reasonable supporting documentation of such costs
and expenses.
7
5.1.5 If Parent does not timely deliver a Purchase Election Notice in accordance
with Section 5.1.4 or declines in writing to execute the applicable Purchase Document, then
Xx. Xxxxxx shall be deemed to have complied with his obligations under this Section 5.1
with respect to such Touzet Option Property, Parent’s rights with respect to such Touzet Option
Property shall expire and Parent shall have no further rights with respect to the purchase of such
Touzet Option Property (but Xx. Xxxxxx shall have no obligation to refund any expenses previously
reimbursed by Parent pursuant to this Section 5.1) and a Touzet Purchaser may consummate
the proposed transaction; provided, however, that (A) the terms of this Section 5.1 shall
continue to apply to any other Touzet Option Property during the Option Period; (B) Xx. Xxxxxx must
consummate the proposed transaction with respect to such Touzet Option Property within one hundred
twenty (120) days following the date of delivery of the Contract Notice on terms no more favorable
in all material respects taken as a whole to the buyer than those set forth in the Purchase
Document (other than such modifications to the transaction terms resulting from findings arising
out of the due diligence process) ; and (C) the provisions of Section 5.2 below, relating
to property management services shall apply with respect to such Touzet Option Property in the
event a Touzet Purchaser acquires such Touzet Option Property.
5.1.6 If Parent timely elects to execute the applicable Purchase Document but subsequently
determines (before or after executing such Purchase Document) to abandon any negotiations with
respect to the acquisition of a Touzet Option Property, then Xx. Xxxxxx shall be deemed to have
complied with his obligations under this Section 5.1 with respect to such Touzet Option
Property, Parent’s rights with respect to such Touzet Option Property shall expire and Parent shall
have no further rights with respect to the purchase of such Touzet Option Property (but Xx. Xxxxxx
shall have no obligation to refund any expenses previously reimbursed by Parent pursuant to this
Section 5.1); provided, however, that (A) the terms of this Section 5.1 shall
continue to apply to any other Touzet Option Property during the Option Period; (B) the Touzet
Purchaser must consummate the proposed transaction with respect to such Touzet Option Property
within one hundred twenty (120) days following the date on which Parent notifies Xx. Xxxxxx in
writing that it has abandoned the transaction, on terms no more favorable in all material respects
taken as a whole to the buyer than those set forth in the Purchase Document (other than such
modifications to the transaction terms resulting from findings arising out of the due diligence
process); and (C) the provisions of Section 5.2 below, relating to property management
services shall apply with respect to such Touzet Option Property in the event a Touzet Purchaser
acquires such Touzet Option Property.
5.2 Property Management Option. On the terms and subject to the conditions of this
Section 5.2, Xx. Xxxxxx, on behalf of himself and any Touzet Purchaser, hereby grants to
Parent (or an Affiliate of Parent) a right of first offer with respect to the provision of
property management services to any Touzet Option Property actually acquired by a Touzet Purchaser
during the Option Period.
5.2.1 Prior to entering into a property management agreement or leasing agreement with
respect to any Touzet Option Property acquired by any Touzet Purchaser, Xx. Xxxxxx shall make
available to Parent the following information with respect to such Touzet Option Property: a
tenant list, rent roll and loan documentation, together with the proposed terms of the property
management arrangement, including management fees, construction management fees and leasing
commissions. The Parties agree that the management agreement for any Touzet
8
Option Property subject to this Section 5.2 shall be in a form reasonably
satisfactory to any Person that holds an interest in the Touzet Option Property and any lender
with respect to the Touzet Option Property.
5.2.2 Parent shall have five (5) business days after receipt of the information identified in
Section 5.2.1 above to notify Xx. Xxxxxx in writing if Parent elects to have an Affiliate
of Parent enter into the proposed management agreement, or to propose alternative terms for the
management agreement by delivery of written notice of such election (a “Management Election
Notice”). If Parent timely delivers a Management Election Notice, then Parent and Xx. Xxxxxx
shall negotiate the terms of the proposed management agreement during the fifteen (15) day period
beginning on Xx. Xxxxxx’x receipt of the Management Election Notice, which terms shall be market
based for the class and location of the property. If Parent and Xx. Xxxxxx cannot agree on the
terms of the proposed management agreement during such fifteen (15) day period, Xx. Xxxxxx shall be
deemed to have complied with his obligations under this Section 5.2 with respect to such
Touzet Option Property and Xx. Xxxxxx or his Affiliates may enter into a management agreement with
respect to such Touzet Option Property with a third party on terms no more favorable in all
material respects taken as a whole to the third party management company than the terms originally
proposed to Parent pursuant to Section 5.2.1 above. If Parent does not timely deliver a
Management Election Notice or declines in writing to enter into the proposed management agreement,
or to propose alternative terms for the management agreement, Xx. Xxxxxx shall be deemed to have
complied with his obligations under this Section 5.2 with respect to such Touzet Option
Property and Xx. Xxxxxx or his Affiliates may enter into a management agreement with respect to
such Touzet Option Property with a third party on terms no more favorable in all material respects
taken as a whole to the third party management company than the terms originally proposed to Parent
pursuant to Section 5.2.1 above.
5.2.3 Notwithstanding anything to the contrary in this Section 5.2, the obligation of
Xx. Xxxxxx to offer Parent the right to manage any Touzet Option Property shall not apply to any
Touzet Option Property in which Xx. Xxxxxx has a co-investor that (i) is actively engaged in office
property management; (ii) is seeking the right to control management services as part of the
acquisition; and (iii) undertakes the management of such Touzet Option Property.
5.3 Confidentiality. Parent hereby acknowledges and agrees, on behalf of itself and
each of its Affiliates and Representatives, that each such Person (i) shall be bound by the terms
and conditions of any confidentiality agreement between Xx. Xxxxxx or any other Touzet Purchaser
and the property owner of any Touzet Option Property (or any of its representatives) in connection
with the potential acquisition of any Touzet Option Property; provided that a copy of any such
confidentiality agreement is provided to Parent, and (ii) shall treat and hold as confidential all
information provided to any such Person in connection with any Touzet Option Property or the rights
and obligations under in this Article 5.
5.4 Definitions. For purposes of Sections 5.1 and 5.2, “Parkway Market” means
any metropolitan statistical area in which Parkway Properties, Inc., or any of its subsidiaries,
manages office properties as of the Closing Date.
9
ARTICLE 6
MISCELLANEOUS PROVISIONS
MISCELLANEOUS PROVISIONS
6.1 Notices. Any notice, request or other communication to be given pursuant to this
Agreement shall be given in writing (including electronic mail, facsimile or similar writing) and
delivered in accordance with Section 16.1 of the Contribution Agreement.
6.2 Entire Agreement. This Agreement, exhibits hereto, the
Confidentiality Agreement and the Contribution Agreement constitute the entire agreement among the
Parties concerning the subject matter hereof, and supersede all other prior agreements,
understandings and negotiations, oral or written, between the Parties concerning such subject
matter.
6.3 Amendments and Waivers.
6.3.1 No modification or waiver of this Agreement shall be enforceable unless made in a
written instrument signed by the Party against whom the modification or waiver would apply.
6.3.2 No failure or delay by any Party in exercising any right, power or privilege under this
Agreement shall operate as a waiver thereof nor shall any single or partial exercise thereof
preclude any other or further exercise thereof or the exercise of any other right, power or
privilege. Except as otherwise provided herein, no action taken pursuant to this Agreement,
including any investigation by or on behalf of any Party, shall be deemed to constitute a waiver by
the party taking such action of compliance with any representations, warranties, covenants or
agreements contained in this Agreement. Any term, covenant or condition of this Agreement may be
waived at any time by the Party that is entitled to the benefit thereof, but only by a written
notice signed by such Party expressly waiving such term or condition. No waiver by any Party
hereto of any default, misrepresentation or breach of warranty or covenant hereunder, whether
intentional or not, shall be deemed to extend to any prior or subsequent default, misrepresentation
or breach of warranty or covenant hereunder or affect in any way any rights arising by virtue of
any prior or subsequent occurrence of such kind.
6.4 No Assignments. No Party shall assign or delegate any of the rights or
obligations under this Agreement to a third party without the prior written consent of the other
Parties. Any such assignment which is not permitted under this Agreement shall be null and void.
6.5 Governing Law. This Agreement shall be governed by, and construed in accordance
with, the Laws of the State of Delaware, regardless of the Laws that might otherwise govern under
applicable principles of conflict of laws thereof.
6.6 Jurisdiction and Venue. Each of the Parties irrevocably and unconditionally
submits to the sole and exclusive personal jurisdiction of (a) the state courts of the State of
Delaware, and (b) the United States District Court for the District of Delaware (and appropriate
appellate courts therefrom), for the purposes of any dispute, claim, controversy, suit, action or
other proceeding arising out of this Agreement or any transaction contemplated hereby. Each of the
Parties further agrees and covenants (i) to commence any such action, suit or proceeding either in
the United States District Court for the District of Delaware or if such suit, action or
10
other proceeding may not be brought in such court for jurisdictional reasons, in any
state court located in the City of Wilmington, Delaware and (ii) to not attempt to deny or defeat
such personal jurisdiction by motion or other request for leave from any such court. Each of the
Parties further agrees and covenants that if subject matter jurisdiction over any action, suit, or
proceeding in connection with any dispute, claim, or controversy arising out of or relating to this
Agreement, the Related Agreements, or the Transactions exists in the Court of Chancery of the State
of Delaware by reason of Section 111 of the DGCL or if there otherwise exists a good faith basis
for concluding that the Court of Chancery of the State of Delaware would have subject matter
jurisdiction in connection with any such action, suit, or proceeding, then any such action, suit,
or proceeding shall be brought exclusively in the Court of Chancery of the State of Delaware, and
each Party agrees that it shall not attempt to deny or defeat subject matter jurisdiction over such
action, suit, or proceeding in the Court of Chancery of the State of Delaware. Each of the Parties
irrevocably and unconditionally waives any objection to the laying of venue of any action, suit or
proceeding arising out of this Agreement or the Transactions in (a) the United States District
Court for the District of Delaware, or (b) any state court located in the City of Wilmington,
Delaware, and hereby further irrevocably and unconditionally waives and agrees not to plead or
claim in any such court that any such action, suit or proceeding brought in any such court has been
brought in an inconvenient forum. Each of the Parties hereby agrees that this Agreement involves at
least $100,000 and that this Agreement has been entered into in express reliance on 6 Del. C. §
2708.
6.7 WAIVER OF TRIAL BY JURY. EACH PARTY HERETO HEREBY WAIVES, RELEASES AND
RELINQUISHES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY ACTIONS ARISING
DIRECTLY OR INDIRECTLY AS A RESULT OR IN CONSEQUENCE OF THIS AGREEMENT, INCLUDING, WITHOUT
LIMITATION, ANY CLAIM OR ACTION TO REMEDY ANY BREACH OR ALLEGED BREACH HEREOF, TO ENFORCE
ANY TERM HEREOF, OR IN CONNECTION WITH ANY RIGHT, BENEFIT OR OBLIGATION ACCORDED OR IMPOSED BY
THIS AGREEMENT.
6.8 Binding Effect. This Agreement shall be binding upon and shall inure to the
benefit of the Parties and their respective heirs, executors, personal representatives, successors
and permitted assigns.
6.9 Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction shall not affect the validity or enforceability
of the remaining terms and provisions hereof or the validity or enforceability of the invalid or
unenforceable term or provision in any other situation or in any other jurisdiction. If a final
judgment of a court of competent jurisdiction declares that any term or provision hereof is invalid
or unenforceable, the Parties agree that the court making the determination of invalidity or
unenforceability shall have the power to reduce the scope, duration, or area of the term or
provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or
provision with a term or provision that is valid and enforceable and that comes closest to
expressing the intention of the invalid or unenforceable term or provision, and this Agreement
shall be enforceable as so modified.
11
6.10 Counterparts. This Agreement may be executed and delivered in
multiple counterparts, each of which shall be deemed an original, and all of which together shall
constitute one and the same instrument. It is the express intent of the Parties to be bound by the
exchange of signatures on this Agreement via facsimile or electronic mail via the portable document
format (PDF). A facsimile or other copy of a signature shall be deemed an original.
6.11 Third Parties. Except as otherwise expressly stated herein, no provision of
this Agreement is intended or shall confer on any Person, other than the Parties (and their
successors and permitted assignees), any rights under this Agreement.
6.12 Exhibits. The exhibits, if any, referenced in this Agreement constitute an
integral part of this Agreement and are incorporated herein by reference and made a part hereof.
6.13 Time Periods. Any action required hereunder to be taken within a certain number
of days shall, unless otherwise provided herein, be taken within that number of calendar days;
provided, however, that if the last day for taking such action falls on a Saturday, a Sunday, or a
legal holiday, the period during which such action may be taken shall be extended to the next
Business Day.
[Signature Page Follows.]
12
IN
WITNESS WHEREOF, the Parties have executed this Agreement as of the date set forth
above.
| EOP: | ||||||
| EOLA OFFICE PARTNERS LLC | ||||||
| By: | /s/ Xxxxx X. Xxxxxxxx | |||||
| Title: Manager | ||||||
| EOC: | ||||||
| EOLA CAPITAL LLC | ||||||
| By: | /s/ Xxxxxxx Prio Touzet | |||||
| Title: Chief Executive Officer | ||||||
| PARENT: | ||||||||
| PARKWAY PROPERTIES, INC. | ||||||||
| By: | /s/ Xxxxxx X. Xxxxxx | |||||||
| Name: Xxxxxx X. Xxxxxx | ||||||||
| Title: President and CEO | ||||||||
| By: | /s/ Xxxxxxx Xxxxxxx | |||||||
| Name: Xxxxxxx Xxxxxxx | ||||||||
| Title: Executive Vice President and Chief Financial Officer | ||||||||
| PARTNERSHIP: PARKWAY PROPERTIES LP |
||||||||
| By: | Parkway Properties General Partners, Inc., general partner | |||||||
| By: | /s/ Xxxxx X. Xxxxxx | |||||||
| Title: Executive Vice President and Chief Investment Officer | ||||||||
| By: | /s/ M. Xxxxxx Xxxxxx | |||||||
| Title: Senior Vice President and Fund Manager | ||||||||
| EXECUTIVES: | ||||||||
| /s/ Xxxxx X. Xxxxxxxx | ||||||||
| Name: Xxxxx X. Xxxxxxxx | ||||||||
| /s/ Xxxxxxx Prio Touzet | ||||||||
| Name: Xxxxxxx Prio Touzet | ||||||||
| /s/ Xxxxx X. Xxxxx, III | ||||||||
| Name: Xxxxx X. Xxxxx, III | ||||||||
