Notes Receivable (Notes)

9 Months Ended

Sep. 30, 2013

Receivables [Abstract]

Notes Receivable

Notes Receivable

On September 4, 2013, Parkway LP and TPG LP entered into a loan agreement pursuant to which Parkway LP agreed to provide a term loan to TPG LP of $80.0 million (the “Term Loan”) to enable TPG LP to fund, prior to closing of the Mergers, a portion of its obligation in connection with the liquidation of TPG/CalSTRS, LLC, a joint venture between TPGI and California State Teachers' Retirement System ("CalSTRS"). The Term Loan was funded on September 27, 2013. TPG LP is subject to certain affirmative and negative covenants while the loan is outstanding, and TPG LP will provide a right of first offer in favor of Parkway LP that applies in certain limited circumstances if TPG LP desires to sell certain properties within twelve months following termination of the Merger Agreement. TPG LP may prepay the loan at any time without penalty. The loan matures on January 1, 2015 and bears interest at a rate of 6% per annum for the first six months, 8% per annum for the next six months and 12% per annum thereafter, with interest payable monthly in arrears. TPG LP also paid Parkway LP a non-refundable loan commitment fee in an amount equal to 1.5% of the Term Loan agreement, or $1.2 million. Parkway LP will be required to refund to TPG LP two-thirds of the amount of this commitment fee in the event the Company is obligated to pay certain expenses of TPGI or a termination fee under the Merger Agreement discussed in Note D - Acquisitions. The commitment fee will be recognized in interest income under the interest method.