Exhibit 10.33
 

 
RETENTION AGREEMENT
 
This AGREEMENT is made as of November 4, 2011, by and between Parkway
Properties, Inc., a Maryland corporation (the “Company”), and Richard G. Hickson
IV (the “Executive”).
 
WHEREAS, the Board of Directors of the Company (the “Board”) believes it is in
the best interests of the Company to diminish the inevitable distraction of the
Executive by virtue of the personal uncertainties and risks in the event
Executive terminates his employment for Good Reason (as defined below) or is
terminated by the Company without Cause (as defined below) and to encourage the
Executive’s full attention and dedication to the Company currently, and to
provide the Executive with compensation and benefits arrangements upon such
termination which ensure that the compensation and benefits expectations of the
Executive will be satisfied; and
 
WHEREAS, the Executive currently serves as Executive Vice President and Chief
Financial Officer of the Company; and
 
WHEREAS, the Board has approved this Agreement and authorized its execution and
delivery on the Company’s behalf to the Executive.
 
NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:
 
1. Term.  The term of this Agreement shall commence on the date hereof and shall
continue until December 31, 2013 (the “Term”).
 
2. Certain Definitions.
 
(a) “Date of Termination” means (i) if the Executive’s employment is terminated
by the Company for Cause, or by the Executive for Good Reason, the date of
receipt of the Notice of Termination or any later date specified therein, as the
case may be, and (ii) if the Executive’s employment is terminated by the Company
other than for Cause or by the Executive other than for Good Reason, the date on
which the Company or the Executive notifies the other of such termination, as
the case may be.
 
3. Termination of Employment.
 
(a) Good Reason.  The Executive may terminate his employment during the Term for
Good Reason.  For purposes of this Agreement, “Good Reason” shall mean any of
the following:
 
(i) the assignment to the Executive during the Term of any duties materially
inconsistent with the Executive’s position (including status, offices, titles,
reporting requirements, authority, duties or responsibilities), or any other
action that results in a material diminution in the Executive’s authority,
duties, or responsibilities;
 
(ii) a material reduction by the Company in the Executive’s base salary in
effect immediately before the Term or as increased from time to time thereafter;
 
 
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(iii) a material reduction by the Company in the Executive’s annual bonus
opportunity or in the target level for such bonus or in the level of the
Executive’s long term equity incentive, as compared to such opportunity or level
in effect immediately before the beginning of the Term;
 
(iv) a failure by the Company to maintain health benefit plans available to the
Executive and the Executive’s family that provide benefits at least as
beneficial as those provided under the plans in which the Executive participated
immediately before the date of this Agreement, or any action taken by the
Company that would adversely affect the Executive’s participation in such plans,
which failure or action reduces the value to the Executive of such health
benefit plans to the extent that the reduction in value, if measured as a
portion of the Executive’s base salary, would be material, provided the Company
does not increase the Executive’s base salary to make up for such reduction in
value to the Executive;
 
(v) a material diminution during the Term in any budget over which the Executive
retains authority;
 
(vi) the Company’s requiring the Executive, without the Executive’s written
consent, to be based at any office or location materially distant from the
Company’s office’s in Jackson, MS or Orlando, FL, except for travel reasonably
required in the performance of the Executive’s responsibilities;
 
(vii) any purported termination by the Company of the Executive’s employment for
Cause otherwise than as referred to in Section 3(c) of this Agreement; or
 
(viii) any failure by the Company to obtain the assumption of the obligations
contained in this Agreement by any successor as contemplated by Section 9(c) of
this Agreement,
 
provided, however, that Good Reason shall not exist unless the Executive gives
notice to the Company of the existence of a condition described in paragraph
(i), (ii), (iii), (iv), (v), (vii), or (viii) within 90 days of the initial
existence of the condition, and the Company does not remedy the condition within
30 days of receipt of notice from the Executive.  The intent of the use of the
terms “materially” and “material” to qualify the conditions described in clauses
(i) through (vi) above is to assure that a termination for Good Reason shall be
considered for purposes of the regulations under section 409A of the Code as an
involuntary separation from service; the terms materially and material shall be
construed accordingly, and without requiring any greater negative change to the
aspect of the Executive’s employment described in the relevant clause above than
would be required to fulfill the intent of the use of the terms materially and
material as described in this sentence.
 
(b) Without Good Reason.  The Executive may terminate his employment during the
Term without Good Reason.
 
 
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(c) Cause.  The Company may terminate the Executive’s employment during the Term
for Cause.  For purposes of this Agreement, “Cause” shall mean (i) the continued
failure by the Executive to perform material responsibilities and duties toward
the Company (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 the
Company 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 the Company and that constitutes on
the part of the Executive common law fraud or malfeasance, misfeasance, or
nonfeasance of duty; provided, however, that Cause shall not include the
Executive’s lack of professional qualifications, or (v) the Executive’s
violation of any of the terms of this Agreement, including, without limitation,
Section 6(b) and (c).  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 the Company.  The
Executive’s employment shall not be deemed to have been terminated for Cause
unless the Company shall have given or delivered to the Executive (A) reasonable
notice setting forth the reasons for the Company’s intention to terminate the
Executive’s employment for Cause, (B) a reasonable opportunity, at any time
during the 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 in Section 4 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), or (iv) of the first sentence of this Section 3(c).
 
(d) Without Cause.  The Company may terminate the Executive other than for
Cause.
 
4. Notice of Termination.  Any termination of Executive’s employment by the
Company for or without Cause, or by the Executive for or without Good Reason,
shall be communicated by a Notice of Termination to the other party.  For
purposes of this Agreement, a “Notice of Termination” means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive’s
employment under the provision so indicated and (iii) states the Date of
Termination, if other than the date of receipt of such notice (but any other
date shall be not more than thirty days after the giving of such notice).  The
failure by the Company or the Executive to set forth in the Notice of
Termination any fact or circumstance which contributes to a showing of Cause or
Good Reason shall not waive any right of the Executive or the Company,
respectively, hereunder or preclude the Executive or the Company, respectively,
from asserting such fact or circumstance in enforcing the Executive’s or the
Company’s rights hereunder.
 
5. Obligations of the Company upon Termination.
 
(a) Good Reason or Without Cause.  If the Executive’s employment is terminated
by Executive for Good Reason, or by the Company without Cause, then (1) the
Executive shall resign all positions with the Company and its subsidiaries and
affiliates, (2) the Company shall promptly deliver to the Executive a waiver and
release in form and substance satisfactory to the Company, whereby, in general,
the Executive releases the Company from all claims the Executive may have
against the Company (other than claims to provide the severance benefits
provided for in this Agreement) (the “Waiver and Release”); and (3) the Company
shall pay to the Executive the following, which includes sums of money and
benefits that the Executive is not otherwise entitled to receive:
 
 
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(i) Regardless of whether the Executive signs and does not revoke the Waiver and
Release:
 
(A) the Company shall pay to the Executive, in a lump sum in cash or immediately
available funds within 10 days after the Date of Termination, the Executive’s
full base salary and vacation pay (for vacation not taken) accrued but unpaid
through the Date of Termination at the rate in effect at the time of the
termination; and
 
(B) to the extent not theretofore paid or provided, the Company shall timely pay
or provide to the Executive any other amounts (including any bonus or non-equity
incentive compensation for any completed year prior to the Date of Termination)
or benefits required to be paid or provided at such time under any plan,
program, policy or practice or contract or agreement of the Company and its
affiliated companies.
 
The amounts and benefits described in sub-paragraphs (A) and (B) shall be
hereinafter referred to as the “Accrued Obligations.”
 
(ii) Subject to the Executive’s execution of the Waiver and Release and the
effectiveness thereof (including the expiration of any applicable revocation
period, without the Executive’s having revoked the Waiver and Release) within 30
days after the Date of Termination (the “Release Effectiveness Date”) the
Company shall pay to the Executive, in a lump sum in cash or immediately
available funds on the thirtieth (30th) day after the Release Effectiveness
Date, a severance payment in an amount equal to the Executive’s “Annual
Compensation”; provided, however, that the severance payment pursuant to this
Section 5(a)(ii) shall be increased to an amount equal to two times the
Executive’s Annual Compensation if the Executive has “Relocated to Orlando,
FL.”  For purposes of this Agreement, “Annual Compensation” shall be an amount
equal to the sum of (x) the Executive’s annual base salary from the Company at
the rate in effect on the Date of Termination, plus (y) an amount equal to the
percentage of base salary that was paid to Executive as a cash bonus in the
fiscal year of the Company ended before the Date of Termination multiplied by
Executive’s then current base salary.  For purposes of this Agreement,
“Relocated to Orlando, FL” shall mean that the Company has requested that the
Executive work from its office in Orlando, Florida and no later than 60 days
after such request, Executive shall work from such office other than when
Executive is travelling on Company business.
 
(b) Cause; Without Good Reason.  If the Executive’s employment shall be
terminated for Cause or if the Executive terminates employment during the Term
other than for Good Reason, this Agreement shall terminate without further
obligations to the Executive, other than for Accrued Obligations.  In such case,
all Accrued Obligations shall be paid to the Executive in a lump sum in cash on
the thirtieth (30th) day after the Date of Termination.
 
 
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6. Covenants as to Confidential Information and Competitive Conduct.
 
(a) The Executive hereby acknowledges and agrees as follows: this Section 6 is
necessary for the protection of the legitimate business interests of the
Company; the restrictions contained in this Section 6 with regard to
geographical scope, length of term, and types of restricted activities are
reasonable; the Executive has received adequate and valuable consideration for
entering into this Agreement; and the Executive’s expertise and capabilities are
such that his obligations hereunder and the enforcement hereof by injunction or
otherwise will not adversely affect the Executive’s ability to earn a
livelihood.
 
(b) The Executive agrees that the Executive will not, directly or indirectly,
without the express written approval of the Company, unless directed by
applicable legal authority (including any court of competent jurisdiction,
governmental agency having supervisory authority over the business of the
Company or its subsidiaries, or any legislative or administrative body having
supervisory authority over the business of the Company or its subsidiaries)
having jurisdiction over the Executive, disclose to or use, or knowingly permit
to be so disclosed or used, for the benefit of himself or of any person,
corporation, or other entity other than the Company:
 
(i) any nonpublic information concerning any financial, accounting or tax
matters, customer relationships, competitive status, supplier matters, internal
organizational matters, current or future plans, or other business affairs of or
relating to the Company, its subsidiaries or affiliated or related parties, or
 
(ii) any proprietary management, operational, trade, technical, or other secrets
or any other proprietary information or other data of the Company, its
subsidiaries or affiliated or related parties,
 
which has not been published and is not generally known outside of the
Company.  The Executive acknowledges that all of the foregoing constitutes
confidential and proprietary information which is the exclusive property of the
Company.
 
(c) From the date of this Agreement and continuing for a period of two years
after the Date of Termination (the “Restrictive Period”), the Executive shall
not, directly or indirectly, solicit or hire or attempt to solicit or hire any
employee of the Company or its subsidiaries or affiliated or related parties, or
induce or encourage any such employee to terminate their employment with the
Company or its affiliated or entities.
 
In the event the Executive violates any of the provisions contained in this
Section 6, the Restrictive Period shall be increased by the period of time from
the commencement by the Executive of any violation until such violation has been
cured to the satisfaction of the Company.
 
(d) The Executive acknowledges and agrees that any breach of this Section 6 will
result in immediate and irreparable harm to the Company, and that the Company
cannot be reasonably or adequately compensated by damages in an action at
law.  In the event of any breach of this Section 6 by the Executive, the Company
shall be entitled to immediately cease to pay or provide the Executive any
compensation or benefit being or to be paid or provided to the Executive
pursuant to this Agreement, and also to obtain immediate injunctive relief
restraining the Executive from conduct in breach of the covenants contained in
this Section 6.  Nothing herein shall be construed as prohibiting the Company
from pursuing any other remedies available to it for such breach, including the
recovery of damages from the Executive.
 
 
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7. Cooperation.  Executive agrees to use his commercially reasonable efforts to
assist, advise and cooperate with the Company if the Company so requests on
issues that arose or were in any way developing during his employment with the
Company, subject to the Executive’s availability given his employment
obligations, if any, and personal obligations at that time.  The Executive shall
furnish such assistance, advice, or cooperation to the Company as the Company
shall reasonably request and as is within the Executive’s reasonable
capability.  Such assistance, advice, and cooperation may include, but shall not
be limited to, the preparation for, or the conduct of, any litigation,
investigation, or proceeding involving matters or events which occurred during
the Executive’s employment by the Company as to which the Executive’s knowledge
or testimony may be important to the Company.  In connection with the
preparation for, or the conduct of such litigation, investigation, or proceeding
as described in the preceding sentence, the Executive shall promptly provide the
Company with any records or other materials in his possession that the Company
shall request in connection with the defense or prosecution of such litigation,
investigation or proceeding.  If and to the extent that the Company requests
that the Executive attend a meeting, deposition, or trial, the Company shall pay
or reimburse the Executive for his travel expenses reasonably incurred in the
course of providing such cooperation.  The Company shall make such payment or
reimbursement within thirty (30) days of receipt of reasonable substantiating
documentation from the Executive but in no event later than the end of the
calendar year following the year in which such expenses were incurred.
 
8. Non-exclusivity of Rights.  Nothing in this Agreement shall prevent or limit
the Executive’s continuing or future participation in any plan, program, policy
or practice provided by the Company and for which the Executive may qualify,
nor, subject to Section 11(f), shall anything herein limit or otherwise affect
such rights as the Executive may have under any contract or agreement with the
Company.  Amounts which are vested benefits or which the Executive is otherwise
entitled to receive under any plan, policy, practice or program of or any
contract or agreement with the Company at or subsequent to the Date of
Termination shall be payable in accordance with such plan, policy, practice or
program or contract or agreement except as explicitly modified by this
Agreement.
 
9. Full Settlement.  The Company’s obligation to make the payments provided for
in this Agreement and otherwise to perform its obligations hereunder shall not
be affected by any set-off, counterclaim, recoupment, defense or other claim,
right or action which the Company may have against the Executive or others.  In
no event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement and such amounts shall not be reduced
whether or not the Executive obtains other employment.
 
 
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10. Successors.
 
(a) This Agreement is personal to the Executive and without the prior written
consent of the Company shall not be assignable by the Executive otherwise than
by will or the laws of descent and distribution.  This Agreement shall inure to
the benefit of and be enforceable by the Executive’s legal representatives or
successor(s) in interest.  The Executive may designate a successor (or
successors) in interest to receive any and all amounts due the Executive in
accordance with this Agreement should the Executive be deceased at any time of
payment.  Such designation of successor(s) in interest shall be made in writing
and signed by the Executive, and delivered to the Company pursuant to Section
11(b).  This Section 10(a) shall not supersede any designation of beneficiary or
successor in interest made by the Executive, or separately covered, under any
other plan, practice, policy, or program of the Company.
 
(b) This Agreement shall inure to the benefit of and be binding upon the Company
and its successors and assigns.
 
(c) The Company will require any successor (whether direct or indirect, by
purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company to assume expressly and agree to perform
this Agreement in the same manner and to the same extent that the Company would
be required to perform it if no such succession had taken place.
 
11. Miscellaneous.
 
(a) This Agreement shall be governed by and construed in accordance with the
laws of the State of Mississippi without reference to principles of conflict of
laws.  The captions of this Agreement are not part of the provisions hereof and
shall have no force or effect.  This Agreement may not be amended or modified
otherwise than by a written agreement executed by the parties hereto or their
respective successors and legal representatives.
 
(b) All notices and other communications hereunder shall be in writing and shall
be given by hand delivery to the other party or by registered or certified mail,
return receipt requested, postage prepaid, addressed as follows:
 
If to the Executive:
 
Richard G. Hickson, IV
Parkway Properties, Inc.
One Jackson Place, Suite 1000
188 East Capitol Street
Jackson, MS, 39201  39157

 
If to the Company:
 
Parkway Properties, Inc.
One Jackson Place, Suite 1000
188 East Capitol Street
Jackson, MS, 39201  39157
Attn:  Executive Vice President of People
 

 
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or to such other address as either party shall have furnished to the other in
writing in accordance herewith.  Notice and communications shall be effective
when actually received by the addressee.
 
(c) The Executive represents that he has conferred with counsel and has been
advised, and believes in good faith, that the six (6) month delay required for
“specified employees” pursuant to section 409A of the Internal Revenue Code of
1986, as amended, does not apply to the payments provided hereunder because such
payments do not constitute “deferred compensation” within the meaning of section
409A.  Executive acknowledges and agrees that he shall be solely responsible for
any additional taxes, penalty or interest that may be imposed by section 409A of
the Code on any such payments and or benefits if any such tax, penalty or
interest is imposed by the Internal Revenue Service.
 
(d) The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provision of this
Agreement.
 
(e) The Company may withhold from any amounts payable under this Agreement such
federal, state, local or foreign taxes as shall be required to be withheld
pursuant to any applicable law or regulation.
 
(f) The Executive’s or the Company’s failure to insist upon strict compliance
with any provision of this Agreement or the failure to assert any right the
Executive or the Company may have hereunder, including, without limitation, the
right of the Executive to terminate employment for Good Reason pursuant to
Section 2(a) of this Agreement, shall not be deemed to be a waiver of such
provision or right or any other provision or right of this Agreement.
 
(g) The Executive and the Company acknowledge that, except as may otherwise be
provided under any other written agreement between the Executive and the
Company, the employment of the Executive by the Company is “at will” and,
therefore, the Executive’s employment may be terminated by either the Executive
or the Company at any time.  From and after the Date of Termination, this
Agreement shall become effective, and shall replace and supercede any existing
employment agreement between the Company and the Executive, to the extent its
terms are more advantageous to the Executive; provided, however, that any
covenants contained in any prior agreement between Executive and the Company
restricting Executive’s ability to compete with or to solicit the employees,
clients or customers of the Company, or to use or disclose any Confidential
Information (as that term may defined in any such agreement), shall remain in
full force and effect; and further provided, that upon Executive’s termination
of employment following a change in control (as defined in any applicable change
in control agreement between Executive and the Company) Executive shall be
entitled to the greater of the benefits Executive is otherwise entitled to under
this Agreement or the benefits Executive is entitled to pursuant to the terms of
such change in control agreement.
 
[SIGNATURES ON FOLLOWING PAGE]
 

 

 
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IN WITNESS WHEREOF, the Executive and the Company, by its duly authorized
representative, have signed this Agreement as of the date set forth above.
 
THE EXECUTIVE:
 
/s/ Richard G. Hickson IV
Richard G. Hickson IV
 
THE COMPANY:
 
PARKWAY PROPERTIES, INC.
 
By: /s/ Warren Speed
Warren Speed, Executive Vice President of People
 

 
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