This Employment
Agreement (the “Agreement”), dated as of 2/24, 2004
(the “Effective Date”), is by and between Government
Properties Trust, Inc., a Maryland corporation (the
“Company”), and Nancy D. Olson, a resident of Nebraska
(the “Executive”):
WHEREAS, the
Executive has extensive experience with real estate companies which
acquire, broker, lease and manage commercial real estate and real
estate investment entities; and
WHEREAS, the
Company wishes to employ the Executive in the capacities and on the
terms and conditions set out below, and the Executive desires to
accept such employment, in the capacities and on the terms and
conditions set forth below.
NOW, THEREFORE,
the Company and the Executive, in consideration of the respective
covenants set out below, hereby agree as follows:
1. Duties
and Scope of Employment .
(a)
Positions . The Executive shall be employed by the Company
as its Chief Financial Officer (“CFO”) and
Treasurer.
(b) Duties
. The Executive’s principal employment duties and
responsibilities shall be those duties and responsibilities
customary for the positions of CFO and Treasurer, and such other
executive duties and responsibilities as the President and Chief
Executive Officer (“CEO”) shall from time to time
assign to the Executive. In particular, the Executive shall:
(i) create and supervise the office of Chief Financial
Officer; (ii) create and supervise the Corporate and Property
Management Accounting Departments; (iii) supervise the
corporate treasury function; (iv) employ, establish duties for
and adjudge the performance of the Corporate Controller;
(v) interface with the asset and property management,
acquisition and project financing functions; (vi) supervise
the human resource/personnel functions; and (vii) carry out
those duties ordinarily associated with the position. The Executive
shall also sit as a member of the Company’s Executive
Management Committee.
(c) Extent of
Services . Except for illnesses and vacation periods, the
Executive shall devote all of her professional time, attention and
best efforts to the performance of her duties and responsibilities
under this Agreement. Notwithstanding the foregoing, Executive may
(i) make any passive investment where she is not obligated or
required to, and shall not in fact, devote any managerial efforts,
(ii) participate in charitable, academic, political or
community activities and boards, and in trade or professional
organizations, and (iii) hold directorships in other companies
consistent with the Company’s conflict of interest policies
and corporate governance guidelines as in effect from time to
time.
(d)
Reporting . The Executive shall report to the
CEO.
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2. At
Will Employment by the Company . The parties agree that the
Executive’s employment with the Company will be “at
will” and may be terminated by the Company or by the
Executive at any time with or without cause and with or without
notice. The Executive understands and agrees that for the duration
of this Agreement, her job performance and promotions,
commendations, bonuses or the like from the Company shall not give
rise to or in any way serve as the basis for modification,
amendment, or extension, by implication or otherwise, of her
“at will” employment with the Company.
3.
Term . This Agreement shall be effective as of the Effective
Date and shall continue in full force and effect thereafter for a
term of three (3) years following the Effective Date (the
“Initial Term”). At the end of the Initial Term, this
Agreement shall be automatically extended for an additional one
(1) year unless either party terminates this Agreement not
later than thirty (30) days prior to the end of the Initial
Term by providing written notice to the other party of such
party’s intent not to renew, or it is sooner terminated
pursuant to Section 8. For purposes of this Agreement,
“Term” shall mean the Initial Term plus any extension
pursuant to this Section 3.
(a) Base
Salary . During the Term of this Agreement, the Company shall
pay the Executive as compensation for her services a base salary at
the annualized rate of one hundred thirty thousand dollars
($130,000.00) with a minimum annual percentage increase equal to
the percentage increase, if any, in the level of the CPI (as
hereinafter defined) last published prior to January 1 of the year
in question over the level of the CPI published in 2003 (the
“Base Salary”). The Base Salary will be paid
periodically in accordance with the Company’s normal payroll
practices and shall be subject to required withholding.
The term
“CPI” means the Consumer Price Index now known as the
U.S. Bureau of Labor and Statistics Consumer Price Index for Urban
Wage Earners and Clerical Workers, all Items for the Omaha,
Nebraska SMSA. If the CPI shall be discontinued, the foregoing
calculation shall be made using a reasonably equivalent successor
or comparable measure of increase in the cost of living in Omaha,
Nebraska.
(b) Annual
Incentive Bonus . The Executive shall be eligible to receive an
annual incentive bonus to be paid in the form of cash or restricted
stock grants which will vest ratably over three years, thirty-three
and one-third percent (33.33%) to vest on the first anniversary of
the grant and two and seven-ninths percent (2.77%) to vest monthly
thereafter, which shall be subject to both the recommendation of
the CEO and the consent of the Compensation Committee and
predicated upon the Executive meeting mutually agreed upon
performance objectives with the CEO.
(c) Grant .
The Executive shall be granted, not later than March 31, 2004,
28,980 shares of the Company’s restricted common stock which
will vest ratably over three years, thirty-three and one-third
percent (33.33%) to vest on the first anniversary of the grant and
two and seven-ninths percent (2.77%) to vest monthly
thereafter.
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5.
Employee Benefits; Insurance.
(a)
Benefits . During the Term, Executive will be eligible to
participate in the employee benefit plans currently and hereafter
maintained by the Company of general applicability to other senior
executives of the Company. The Company reserves the right to cancel
or change the benefit plans and programs it offers to its employees
at any time.
(b) D&O
Insurance . During the Term and thereafter for a period
sufficient to include any claims made within applicable statute of
limitations, the Company shall maintain director and officer
insurance covering the Executive’s acts and omissions while
an officer of the Company, in a face amount of not less than ten
million dollars ($10,000,000.00).
6. Paid
Time Off . The Executive will be entitled to paid time off
(“PTO”) in accordance with the Company’s PTO
policy.
7.
Expenses . The Company will reimburse the Executive for
reasonable travel, entertainment or other expenses incurred by the
Executive in the furtherance of or in connection with the
performance of the Executive’s duties hereunder in accordance
with the Company’s expense reimbursement policy as in effect
from time to time.
(a) Voluntary
Termination; Termination for Cause . If the Executive’s
employment with the Company is terminated by the Executive
voluntarily without Good Reason (as defined below), or is
terminated by the Company for Cause (as defined below) during the
Term, then all vesting of unvested equity compensation awards and
other benefits will terminate immediately and all payments of
compensation by the Company to the Executive hereunder will
terminate immediately (except as to amounts already
earned).
(b) Involuntary
Termination . If Executive’s employment is terminated by
the Company without Cause (as defined below) or if the Executive
terminates her employment with Good Reason (as defined below)
during the Term, then the Executive will be eligible for severance
benefits in accordance with the Company’s practices as then
in effect, which shall not be less than the remaining Base Salary
to be paid hereunder through the Term, and all unvested grants
shall immediately become fully vested and exercisable.
(c) Death:
Disability . This Agreement will automatically terminate in the
event of the death of the Executive and may be terminated by either
party in the event of the physical or mental disability of the
Executive to such extent that the Executive is unable to perform
her duties herein for a continuous period exceeding ninety
(90) days or for an aggregate of one hundred twenty
(120) days in any twelve month period during the Term. For
purposes of counting the foregoing periods, days properly
designated by the
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Executive as
vacation days shall not be counted, nor shall days designated by
the Executive as vacation serve to break the continuous periods set
forth above. In the event this Agreement is terminated due to the
Executive’s death or disability, all vesting of unvested
equity compensation awards will terminate immediately and the
Executive or her estate, as the case may be, shall be paid the
Executive’s Base Salary and shall continue to receive all
accrued fringe benefits hereunder through the end of the month in
which the termination event occurs.
(d) Cause .
For purposes of this Agreement, “Cause” shall mean:
(i) an act of fraud or dishonesty by the Executive in
connection with the Executive’s responsibilities as an
employee; (ii) the Executive’s conviction of, or plea of
nolo contendere to, a felony or gross misdemeanor; (iii)
Executive’s gross misconduct: (iv) the Executive’s
continued failure to perform employment duties for at least thirty
(30) days after the Executive has received a written demand
for performance from the Company that specifically sets forth the
factual basis for the Company’s belief that the Executive has
not performed her duties; (v) any breach by the Executive of
this Agreement or any other agreement between the Executive and the
Com
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