Exhibit 10.1
SEPARATION AGREEMENT AND GENERAL RELEASE
1.
PARTIES. The parties to this Separation
Agreement and General
Release ("Agreement") are:
A. M. Brett Franklin ("Employee").
B. PS Business Parks, Inc., and its past and present
shareholders,
officers, directors, employees, affiliated
companies, attorneys, agents and
representatives ("Employer").
2. RECITALS.
A. Employee has been employed by Employer as Senior Vice
President
of Acquisitions and Dispositions since on
or about November 11, 1996. The
parties agree that the employment
relationship will terminate at 11:59 P.M.
Pacific Time on March 31, 2009.
B. Pursuant to Employee's
terms of employment and prior to entering
into this Agreement, Employee had been
awarded various non-qualified stock
options under Employer's equity plans
including 15,000 non-qualified stock
options to acquire 15,000 common shares of PS Business Parks,
Inc. stock, that
that are currently vested and exercisable, with a grant price of
$31.66; and 400
restricted stock units that were scheduled to vest on June 14,
2009.
C. The parties have
agreed that to end their
employment
relationship in a mutually satisfactory
manner, and to resolve all known and
unknown disputes between the parties, the
following covenants and agreements
shall be made:
3.
POSITIONS. Employee will continue to serve as PS
Business Parks,
Inc.'s Senior Vice President of Acquisitions and Dispositions
through March 31,
2009. In this position, Employee will continue to report to
PS Business Park's
Chief Executive Officer or to such
other person as may be designated by
Employer's Chief Executive Officer or its Board of Directors.
During the term of
this Agreement, Employer may, consistent with
Employee's qualifications and
experience, change Employee's
responsibilities at any time by creating new
responsibilities and/or moving certain responsibilities.
Employee will continue
to devote his full time efforts toward fulfilling the
responsibilities of his
position through March 31, 2009.
4. COOPERATION.
The parties agree that through March 31, 2009, Employee
will, among other things that Employer may reasonably request in
connection with
Employer's business, (a) use
his reasonable best efforts to
assist in
effectuating a smooth
transition of his
projects, assignments and
responsibilities and (b) provide
ongoing strategic and other advice
and
assistance as Employer may determine, in its sole discretion, to be
necessary.
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The parties further agree that at all times
following March 31,
2009, Employee will cooperate fully with
the Employer in providing truthful
testimony as a witness or a declarant in connection
with any present or future
court, administrative, governmental agency or
arbitration proceeding involving
the Employer with respect to which the Employee has relevant
information arising
out of his employment with the Employer.
Employee also will assist Employer
during the discovery phase (or prior thereto) of any
judicial, administrative,
arbitration, or governmental agency
proceeding involving Employer and with
respect to which the Employee has
relevant information arising out of his
employment with Employer including, without
limitation, meeting with counsel,
assisting and cooperating in the
preparation and review of documents, and
meeting with other representatives of the Employer. The
parties agree that such
cooperation and assistance shall, to the extent
practicable (giving due regard
to the needs of the Employer and the requirements
of Employee's then current
work obligations), be at times and places that are
mutually convenient to both
the Employee and the Employer. Moreover, Employee will not be
required to assist
on such matters in excess of an average of 10 hours per
month up to a total of
20 hours, except at an hourly rate of $200.00. If the
parties cannot agree on
mutually convenient times and places, the
Employer will provide the Employee
with a choice of three acceptable dates in
different weeks and places and
Employee will select one of the three. The
parties agree that this procedure
shall apply anytime the Employer
and Employee cannot agree on a mutually
convenient time and place to meet. The Employer
agrees that it will pay, upon
production of appropriate receipts, the reasonable business
expenses (including
air transportation, hotel, and
similar expenses) incurred by Employee
in
connection with such assistance. Employee
represents that he is not presently
aware of any conflict of interest between himself
and Employer in connection
with any pending litigation or investigations that may
give rise to a question
regarding the possible need for independent counsel with
respect to the defense
of such matters.
Effective as of 11:59 P.M. Pacific Time, March 31,
2009, Employee
will be terminated as Senior Vice President of Acquisitions
and Dispositions of
PS Business Parks, Inc., and terminated from all other officer
positions that he
holds with PS Business Parks, Inc. with any of its
subsidiaries and affiliated
companies. Employee agrees to sign,
if requested by Employer, any
forms
necessary to effectuate such
termination from any offices he holds
with
Employer.
5.
COMPENSATION. Until Employee's employment
terminates on March 31,
2009, Employee will continue to be paid twice monthly on the
fifteenth and last
day of the month at a rate of $205,000 per year. Until March 31,
2009, Employee
will continue to participate in Employer's
group insurance plans and 401(k)
plan. Until March 31, 2009, Employer will
continue to reimburse Employee for
those properly documented, reasonable travel or similar
expenditures incurred by
Employee consistent with prior practice that are
reasonably necessary for the
proper discharge of Employee's duties under this Agreement.
Employee will submit
all expense reports for reasonable
business expenses by March 31, 2009 and
provide receipts satisfactory to Employer in accordance with
Employer's current
policy.
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On the Effective Date, if Employee executes and delivers to
Employer
a signed copy of this Agreement
which has not been revoked, as
further
consideration, and as previously
approved by the PS Business Parks, Inc.
Compensation Committee, Employee will have through December 31,
2009 to exercise
15,000 non-qualified stock options that are currently vested and
exercisable. In
addition, 400 restricted stock units that
were scheduled to vest on June 14,
2009 will be accelerated and vested as of March 31, 2009. All
other unvested PS
Business Parks, Inc. stock options and restricted stock units shall
terminate as
of 11:59 PM Pacific Time, April 1, 2009. All
vested PS Business Parks, Inc.
stock options held by Employee on March 31, 2009 shall be
handled in accordance
with the applicable equity plan and option agreement.
Employee agrees to comply
with the Employer's trading blackout
period in effect on March 31,
2009
prohibiting open market trading in Employer's securities, until
Employer advises
its executive officers and insiders that the window to trade
Employer securities
is open, which will occur by email to
Employee's designated email and is
currently anticipated to open after two
trading days following the public
announcement of Employer's first quarter 2009
earnings. Employee shall not be
subject to any further Employer trading blackout periods after the
first quarter
2009 trading window opens.
In addition, on the Effective Date,
if Employee executes and
delivers to Employer a signed copy of this Agreement which has not
been revoked,
as further consideration and to further assist Employee in
transitioning to new
employment, and as previously
approved by the PS Business
Parks, Inc.
Compensation Committee, Employer will pay to Employee a lump
sum payment in the
amount of $153,750 less all applicable state and federal
withholdings.
In addition, Employer will pay to Employee any
accrued but unused
vacation time as of March 31, 2009.
Employee acknowledges that as of the time of Employee's execution
of
this Agreement, Employee has received all
wages and other compensation due
Employee in connection with Employee's employment
relationship with Employer,
including but not limited to compensation for vested vacation
benefits, and that
the compensation provided for in this section will constitute
the sole, entire,
and only financial obligations of Employer to Employee.
Employee acknowledges and
agrees that Employer has made no
representations to Employee regarding the
tax consequences of any amounts
received by Employee pursuant to this Agreement. Employee agrees to
pay federal,
state and/or local taxes, if any,
which are required by law to be paid with
respect to this Agreement. Employee fully agrees to indemnify and
hold Employer,
and all of its Employees, principals and
agents, harmless from any claims,
demands, deficiencies, levies, assessments, executions,
judgments or recoveries
by any governmental entity against
Employer for any amounts claimed due on
account of this Agreement or pursuant to claims made under any
federal, state or
loc
