SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a)
of the Securities Exchange Act of 1934
Filed by the Registrant  x
Filed by a Party other than the Registrant  o
Check the appropriate box:

o	Preliminary Proxy Statement	o	Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))	
x	Definitive Proxy Statement	 	 	
o	Definitive Additional Materials	 	 	
o	Soliciting Material Pursuant to § 240.14a-11(c) or § 240.14a-12	 	 	
PIEDMONT OFFICE REALTY TRUST, INC.

 	

(Name of Registrant as Specified in its Charter)

 	
(Name of Person(s) Filing Proxy Statement, if other than Registrant)
Payment of Filing Fee (Check the appropriate box)

x	No fee required.	
o	Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.	
 	(1)	Title of each class of securities to which transaction applies:	
 	 	 	
 	(2)	Aggregate number of securities to which transaction applies:	
 	 	 	
 	(3)	Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):	
 	 	 	
 	(4)	Proposed maximum aggregate value of transaction:	
 	 	 	
 	(5)	Total fee paid:	

 	
 	 	 	
o	Fee paid previously with preliminary materials.	
o	Check box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.	
 	(1)	Amount Previously Paid:	
 	 	 	
 	(2)	Form, Schedule or Registration No.:	
 	 	 	
 	(3)	Filing Party:	
 	 	 	
 	(4)	Date Filed:	

March 24, 2015
Dear Stockholder:
Attached for your review is a notice of the 2015 Annual Meeting of Stockholders and Proxy Statement for Piedmont Office Realty Trust, Inc. (“Piedmont”). YOUR VOTE IS VERY IMPORTANT. Please respond immediately to help us avoid potential delays and additional expense to solicit votes.
We are asking you to read the enclosed materials and to vote on the election of your board of directors, the ratification of the appointment of our independent registered public accounting firm for fiscal 2015, and the approval, on an advisory basis, of the compensation of our named executive officers. You will find more detail about these proposals in the attached documents. We ask that you review these documents thoroughly and submit your vote as soon as possible in advance of the annual meeting on May 12, 2015.
If you have any questions, please call your broker or financial advisor, or contact Piedmont Shareowner Services by calling 866-354-3485 or emailing  investor.services@piedmontreit.com . To view our latest company regulatory filings and updates, including Form 8-K filings, please visit our Web site at  www.piedmontreit.com .
Thank you for your support of Piedmont and for your prompt vote.
Sincerely,
/s/ DONALD A. MILLER, CFA
Donald A. Miller, CFA
Chief Executive Officer
Piedmont Office Realty Trust, Inc.

PIEDMONT OFFICE REALTY TRUST, INC
PROXY STATEMENT
2015 ANNUAL MEETING OF STOCKHOLDERS
TABLE OF CONTENTS

 	
 	 	
 	Page No.	
Questions and Answers 	1	
Proposal I: Election of Directors 	5	
Proposal II: Ratification of Ernst & Young LLP as Independent Registered Public Accounting Firm for Fiscal 2015	8	
Proposal III: Advisory Vote to Approve Named Executive Officer Compensation	10	
Certain Information about Management 	11	
Information Regarding the Board of Directors and Committees 	13	
Executive Compensation	19	
Summary Compensation Table 	30	
Realized Pay Table	31	
Grants of Plan Based Awards 	33	
Outstanding Equity Awards at Fiscal Year End 	34	
Stock Vested 	36	
Change of Control	36	
Director Compensation 	38	
Equity Compensation Plan Information 	39	
Report of the Compensation Committee	39	
Compensation Policies and Practices as they Relate to Risk Management	40	
Certain Relationships and Related Transactions	40	
Stock Ownership 	40	
Audit Committee Report 	43	
Stockholder Proposals 	44	
Householding	44	
Other Matters 	44	

PIEDMONT OFFICE REALTY TRUST, INC.
11695 Johns Creek Parkway, Suite 350
Johns Creek, Georgia 30097
Notice of Annual Meeting of Stockholders
and Proxy Statement
To Be Held May 12, 2015
Dear Stockholder:
On Tuesday, May 12, 2015, Piedmont Office Realty Trust, Inc. (“Piedmont”), a Maryland corporation, will hold its 2015 Annual Meeting of Stockholders (the “Annual Meeting”) at the Metropolitan Club, 5895 Windward Parkway #100, Alpharetta, GA 30005. The meeting will begin at 11:00 a.m. Eastern daylight time.
The purpose of this Annual Meeting is to:
(i) elect eight directors identified in the 2015 proxy statement to hold office for up to one-year terms expiring in 2016;
(ii) ratify the appointment of Ernst & Young LLP as Piedmont’s independent registered public accounting firm for fiscal 2015;
(iii) approve, on an advisory basis, the compensation of our named executive officers; and
(iv) transact any other business as may properly come before the meeting.
Your board of directors has selected March 2, 2015 as the record date for determining stockholders entitled to vote at the meeting.
On April 1, 2015, we will begin mailing our stockholders a Notice of Internet Availability of Proxy Materials containing instructions on how to access our proxy materials, including our 2015 proxy statement and our Annual Report to Stockholders for fiscal 2014, and how to vote online.
Whether or not you plan to attend the meeting, your vote is very important, and we encourage you to vote promptly. You may vote via a toll-free telephone number or over the Internet. If you received a paper copy of the proxy card by mail, you may sign, date, and mail the proxy card in the envelope provided. Instructions regarding all three methods offered for voting are contained in the proxy card or Notice of Internet Availability of Proxy Materials. If you execute a proxy but later decide to attend the meeting in person, or for any other reason desire to revoke your proxy, you may do so at any time before 11:59 p.m. Eastern daylight time on May 11, 2015.

BY ORDER OF THE BOARD OF DIRECTORS
/s/ THOMAS A. MCKEAN
Thomas A. McKean
Associate General Counsel and Corporate Secretary
Atlanta, Georgia
March 24, 2015

Important Notice Regarding the Availability of Proxy Materials for the Stockholders Meeting to Be Held on May 12, 2015: Our 2015 proxy statement and our Annual Report to Stockholders for fiscal 2014 are available at www.envisionreports.com/PDM.

QUESTIONS AND ANSWERS

 	We are providing you with this proxy statement, which contains information about the items to be voted upon at our Annual Meeting. To make this information easier to understand, we have presented some of the information below in a question and answer format.	
 	 	
Q:	Will my vote make a difference?	

 	 	
A:	Yes – YOUR VOTE IS VERY IMPORTANT. Your vote is needed to ensure that the proposals can be acted upon. Your immediate response will help avoid potential delays and may save Piedmont significant additional expenses associated with soliciting stockholder votes.	

 	 	
Q:	Why am I receiving this proxy statement and proxy card?	

 	 	
A:	You are receiving a proxy statement and proxy card from us because our board of directors is soliciting your proxy to vote your shares at the Annual Meeting. This proxy statement describes issues on which we would like you, as a stockholder, to vote. It also gives you information on these issues so that you can make an informed decision.

When you vote using the Internet, by telephone, or by signing and returning the proxy card, you appoint Donald A. Miller, CFA, our Chief Executive Officer, and Robert E. Bowers, our Chief Financial Officer, as your representatives at the Annual Meeting. Messrs. Miller and Bowers will vote your shares at the Annual Meeting as you have instructed them or if an issue that is not on the proxy card comes up for vote, in accordance with their best judgment. This way, your shares will be voted whether or not you attend the Annual Meeting. Even if you plan to attend the Annual Meeting, it is a good idea to vote in advance of the Annual Meeting just in case your plans change.	

 	 	
Q:	Why did I receive a Notice of Internet Availability of Proxy Materials in the mail instead of a printed set of proxy materials?	

 	 	
A:	Pursuant to rules adopted by the Securities and Exchange Commission (the "SEC"), we are permitted to furnish our proxy materials over the Internet to our stockholders by delivering a notice in the mail. If you received a notice by mail, you will not receive a printed copy of the proxy materials in the mail. Instead, the notice instructs you on how to access and review the proxy statement and annual report over the Internet at  www.envisionreports.com/PDM . The notice also instructs you on how you may vote. If you received a notice by mail and would like to receive a printed copy of our proxy materials, you should follow the instructions for requesting these materials contained on the notice.	

 	 	
Q:	When is the Annual Meeting and where will it be held?	

 	 	
A:	The Annual Meeting will be held on Tuesday, May 12, 2015, at 11:00 a.m. (Eastern daylight time) at the Metropolitan Club, 5895 Windward Parkway #100, Alpharetta, GA 30005.	

 	 	
Q:	What is the record date?	

 	 	
A:	The record date is set for March 2, 2015. Only holders of record of common stock as of the close of business on this date will be entitled to vote at the Annual Meeting as of the close of business on the record date.	

 	 	
Q:	How many shares of common stock are outstanding and can vote?	

 	 	
A:	As of the record date, there were 154,339,315 shares of our common stock issued and outstanding. Every stockholder is entitled to one vote for each share of common stock held.	

 	 	
Q:	How many votes do you need to hold the Annual Meeting?	

 	 	
A:	In order for us to conduct the Annual Meeting, we must have a quorum, which means that a majority of our outstanding shares of common stock as of the record date must be present in person or by proxy at the Annual Meeting. Your shares will be counted as present at the Annual Meeting if you:	

 	 	 	
 	Ÿ	vote over the Internet or by telephone;	
 	Ÿ	properly submit a proxy card (even if you do not provide voting instructions); or	
 	Ÿ	attend the Annual Meeting and vote in person.	

1

 	
 	 	
Q:	What items am I being asked to vote on at the Annual Meeting?	

 	 	
A:	You are being asked to:	

 	 	 	
 	(i)	elect eight directors to serve on the board of directors until our 2016 annual meeting of stockholders;	
 	(ii)	ratify the appointment of Ernst & Young LLP as Piedmont’s independent registered public accounting firm for fiscal 2015; and	
 	(iii)	approve, on an advisory basis, the compensation of the named executive officers as disclosed in this proxy statement.	
 	 	 	
 	No cumulative voting rights are authorized, and dissenter’s rights are not applicable to the matters being voted upon.	
 	 	
Q:	How do I vote if I am a registered stockholder?	

 	 	
A:	If you are a registered stockholder, meaning that your shares are registered in your name, you have four voting options as described below:	

 	 	 	
 	Ÿ	You may vote by using the Internet. The address of the website for Internet voting can be found on your proxy card. Internet voting is available 24 hours a day until 11:59 p.m. eastern daylight time on May 11, 2015.	
 	Ÿ	You may vote by telephone. The toll-free telephone number can be found on your proxy card. Telephone voting is available 24 hours a day until 11:59 p.m. eastern daylight time on May 11, 2015.	
 	Ÿ	You may vote by mail. If you choose to vote by mail, simply mark and sign your proxy card and return it in the enclosed prepaid and addressed envelope. Voted proxy cards must be mailed and received by 11:59 p.m. eastern daylight time on May 11, 2015 in order to be counted.	
 	Ÿ	You may vote by attending the Annual Meeting and voting in person.	
 	 	 	
 	If you have Internet access, we encourage you to record your vote on the Internet. It is convenient, and it saves Piedmont significant postage and processing costs. In addition, when you vote via the Internet or by phone prior to the meeting date, your vote is recorded immediately and there is no risk that postal delays will cause your vote to arrive late and, therefore, not be counted. For further instructions on voting, see your enclosed proxy card in this proxy statement or the Notice of Internet Availability of Proxy Materials.	
 	 	
Q:	Are voting procedures different if I hold my shares in the name of a broker, bank or other nominee?	

 	 	
A:	If your shares are held in “street name” through a broker, bank or other nominee, please refer to your proxy card or the instructions provided by your broker, bank, or other nominee regarding how to vote your shares or to revoke your voting instructions. The availability of telephone and Internet voting depends on the voting processes of the broker, bank or other nominee.	
 	Written ballots will be passed out to anyone who wants to vote at the Annual Meeting. However, if you hold your shares in street name, you must obtain a legal proxy from your broker, bank or other nominee to be able to vote in person at the Annual Meeting.	

 	 	
Q:	How may I vote for the nominees for director, and how many votes must the nominees receive to be elected?	

 	 	 	
A:	With respect to the election of directors, you may:	
 	Ÿ	vote FOR ALL eight nominees for director;	
 	Ÿ	vote FOR ALL EXCEPT which will be considered a vote in favor of all nominees EXCEPT those nominees you specifically list in the space provided; or	
 	Ÿ	WITHHOLD ALL which will be considered a vote against all director nominees.	
 	 	 	
 	Directors are elected by a plurality vote. As a result, the eight nominees receiving the highest number of FOR votes will be elected as directors. If you sign your proxy card with no further instructions, your shares will be voted FOR ALL eight nominees for director.	
 	We have a majority voting policy for the election of non-employee directors. The policy, which is part of our Corporate Governance Guidelines, sets forth our procedures if a nominee is elected, but receives a majority of votes withheld. In an uncontested election, any non-employee nominee for director who receives a greater number of votes withheld from his or her election than votes for his or her election is required to promptly tender his or her resignation. Our Nominating and Corporate Governance Committee is required to promptly consider the resignation offer and make a recommendation to the board of directors with respect to the resignation. The board is required to take action with respect to this recommendation. The policy is more fully described below under “Information Regarding the Board of Directors and Committees--Majority Voting Policy.”	

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Q:	What happens if a nominee is unable to stand for election?	

 	 	
A:	If a nominee is unable to stand for election, the board of directors may reduce the number of directors that serve on the board or designate a substitute nominee. If the board of directors designates a substitute nominee, shares represented by proxies voted for the nominee who is unable to stand for election will be voted for the substitute nominee.	

 	 	
Q:	How may I vote for the ratification of Ernst & Young LLP as the independent registered public accounting firm, and how many votes must the ratification receive to pass?	

 	 	
A:	With respect to the ratification of Ernst & Young LLP as independent registered public accounting firm, you may:	

 	 	 	
 	Ÿ	vote FOR the ratification;	
 	Ÿ	vote AGAINST the ratification; or	
 	Ÿ	abstain from voting.	
 	 	 	
 	Ernst & Young LLP will be ratified as the independent registered public accounting firm if the proposal receives the affirmative vote of a majority of the votes cast at the Annual Meeting. If you sign your proxy card with no further instructions, your shares will be counted as a vote FOR the ratification of Ernst & Young LLP.	
 	 	
Q:	How may I vote on the proposal to approve, on an advisory basis, the executive compensation of the named executive officers as disclosed in this proxy statement, and how many votes must the proposal receive to pass?	

 	 	
A:	With respect to this proposal, you may:	

 	 	 	
 	Ÿ	vote FOR the approval, on an advisory basis, of the compensation of the named executive officers;	
 	Ÿ	vote AGAINST the approval, on an advisory basis, of the compensation of the named executive officers; or	
 	Ÿ	abstain from voting.	
 	Unlike some of the other proposals you are voting on, this is an advisory proposal, which means it is not binding. The board of directors will review the voting results and consider the outcome in making future decisions on executive compensation. The compensation of our named executive officers will be approved, on an advisory basis, if the proposal receives the affirmative vote of a majority of the votes cast at the Annual Meeting. If you sign your proxy card with no further instructions, your shares will be counted as a vote FOR the approval of executive compensation.	

 	 	 	
Q:	How does the board of directors recommend I vote on the proposals?	

 	 	
A:	The board of directors recommends a vote FOR ALL nominees for election as director who are named as such in this proxy statement; FOR the ratification of Ernst & Young LLP as independent registered public accounting firm for fiscal 2015; and FOR the approval, on an advisory basis, of the compensation of the named executive officers.	

 	 	
Q:	What if I vote and then change my mind?	

 	 	
A:	If you are a registered stockholder, you have the right to revoke your proxy at any time before 11:59 p.m. Eastern daylight time on May 11, 2015 by:	

 	 	 	
 	Ÿ	voting again over the Internet or by telephone;	
 	Ÿ	giving written notice to Thomas A. McKean, our Secretary; or	
 	Ÿ	returning a new, valid proxy card bearing a later date, that is received before such time.	
 	 	 	
 	You may also revoke your proxy by attending the Annual Meeting and voting in person. If you hold your shares in the name of a broker, bank, or other nominee, please refer to your broker’s proxy card or instructions to revoke your vote.	

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Q:	How will the proxies be voted?	

 	 	
A:	Any proxy, if it is received in time, is properly signed and is not revoked, will be voted at the Annual Meeting in accordance with the directions of the stockholder signing the proxy. If you return a signed proxy card but do not provide voting instructions, your shares will be voted FOR all of the eight nominees to serve on the board of directors; FOR the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for fiscal 2015; and FOR the approval, on an advisory basis, of the compensation of the named executive officers.	

 	 	
Q:	What are the effects of abstentions and broker non-votes?	

 	 	
A:	Abstentions and broker non-votes with respect to a proposal are counted for purposes of establishing a quorum.

If your shares are held in “street name” through a broker, bank or other nominee and you do not provide voting instructions, your broker, bank or other nominee may only vote your shares on your behalf for “routine” matters.

On “routine” matters, such as the ratification of independent registered public accounting firm, brokerage firms have authority to vote their customers’ shares if their customers do not provide voting instructions. When a brokerage firm votes its customers’ shares on a routine matter without receiving voting instructions, these shares are counted both for establishing a quorum to conduct business at the meeting and in determining the number of shares voted for or against the routine matter.
	
 	On “non-routine” matters, such as the election of directors and the approval, on an advisory basis, of the compensation of the named executive officers, the brokerage firm cannot vote the shares on that proposal if it has not received voting instructions from the beneficial owner of such shares. A “broker non-vote” occurs when a beneficial owner fails to provide voting instructions to his or her broker as to how to vote shares held by the broker in street name and the broker does not have discretionary authority to vote without instructions.	
 	With respect to the proposals to elect eight nominees to our board of directors; regarding the ratification of Ernst & Young LLP as the independent registered public accounting firm; and to approve, on an advisory basis, the executive compensation of the named executive officers, abstentions, withhold votes, and broker non-votes (each as applicable) will have no effect on the outcome of the vote.	

 	 	
Q:	Who pays the cost of this proxy solicitation?	

 	 	
A:	We will pay all the costs of mailing and soliciting these proxies. Our employees will not be paid any additional compensation for soliciting proxies. Georgeson, Inc., our proxy solicitor, will be paid an administrative fee of approximately $6,500 plus $4.00 per phone vote as well as out-of-pocket expenses for its basic solicitation services. We may also reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to beneficial owners.	

 	 	
Q:	Is this proxy statement the only way that proxies are being solicited?	

 	 	
A:	No. In addition to mailing proxy solicitation material, Georgeson, Inc. (our third party proxy solicitor) and our directors and employees may also solicit proxies in person, via the Internet, by telephone or by any other electronic means of communication we deem appropriate.	

 	 	
Q:	How can I obtain additional copies of this proxy statement or other information filed with the SEC relating to this solicitation?	

 	 	
A:	You may obtain additional copies of this proxy statement, our Annual Report to Stockholders for fiscal 2014 and all other relevant documents filed by us with the SEC free of charge from our Web site at  www.piedmontreit.com  or by calling Shareowner Services at 866-354-3485.

In addition, we file annual, quarterly and special reports, proxy statements and other information with the SEC. Our SEC filings are available to the public on the website maintained by the SEC at  http://www.sec.gov .	

4

PROPOSAL I:
ELECTION OF DIRECTORS
At the Annual Meeting, you will vote on the election of eight directors. Those persons elected will serve as directors until the next annual meeting unless otherwise stated and until the election and qualification of their successors. All of the nominees have served as directors since our last meeting with the exception of Ms. Lang, who joined our board on January 2, 2015. Each nominee has been nominated for election by our board of directors in accordance with our established nomination procedures discussed in this proxy statement. Ms. Lang was recommended as a candidate for director by our Chief Executive Officer.

 	 	 	 	
Name	Age	
 	Position(s)	
Michael R. Buchanan	67	
 	Director* and Chairman of the Board of Directors	
Wesley E. Cantrell	80	
 	Director*	
William H. Keogler, Jr.	69	
 	Director*	
Barbara B. Lang	71	
 	Director*	
Frank C. McDowell	66	
 	Director* and Vice-Chairman of the Board of Directors	
Raymond G. Milnes, Jr.	63	
 	Director*	
Donald A. Miller, CFA	52	
 	Chief Executive Officer, President and Director	
Jeffrey L. Swope	64	
 	Director*	
________________________

*	Indicates that such director is considered independent under the New York Stock Exchange (“NYSE”) independence standards as determined by our board of directors.	
Pursuant to our Bylaws and Maryland General Corporation Law, except in the cases of death or resignation, each director will serve until the next annual meeting of our stockholders unless otherwise stated and until his successor has been duly elected and qualified.
The following is detailed information regarding each of the nominees:
Michael R. Buchanan has served as a director of our company since 2002 and as Chairman of the Board of Directors since February 2015. He was employed by Bank of America, N.A. and its predecessor banks, NationsBank and C&S National Bank, from 1972 until his retirement in March 2002. While at Bank of America, he held several key positions, including Managing Director of the Real Estate Banking Group, which was responsible for providing real estate loans, including construction, acquisition, development and bridge financing for the commercial and residential real estate industry, as well as providing structured financing for REITs. Mr. Buchanan also currently serves as director of D.R. Horton, Inc. (NYSE: DHI).
Mr. Buchanan brings many years of real estate financing and transactional expertise to the board including extensive experience dealing with lenders and ratings agencies, structured finance transactions, complex financial instruments and the financing process with lenders. Based on his many years of reviewing real estate financing opportunities, he is very familiar with the different geographic markets in which Piedmont owns or may potentially own properties. Additionally, his thirteen years of experience serving on our board of directors, including service as Chairman of the Capital Committee, member of the Compensation Committee and member of the Nominating and Corporate Governance Committee at various points during his tenure, added to his experience serving on the board of another large publicly-traded real estate company, D.R. Horton, make him well-qualified to serve as Chairman of the Board of Directors.
Wesley E. Cantrell has served as a director of our company since 2007. He was employed by Lanier Worldwide, Inc. (formerly NYSE: LR), a global document management company, from 1955 until his retirement in 2001. While at Lanier, Mr. Cantrell served in a number of key positions, including President from 1977 to 1987, President and Chief Executive Officer from 1987 to 1999, and Chairman and Chief Executive Officer from 1999 to 2001. From 1998 to 2009, Mr. Cantrell served as a director for AnnTaylor Stores Corporation (NYSE: ANN). Mr. Cantrell formerly served as a director for First Union National Bank of Atlanta, for Oxford Industries, Inc. (NYSE: OXM), and briefly for Institutional REIT, Inc.
Mr. Cantrell brings to the board broad senior management expertise based on his years as President, Chief Executive Officer and Chairman of a large, complex business such as Lanier Worldwide. While serving on AnnTaylor’s board of directors, Mr. Cantrell chaired the Nominating and Corporate Governance Committee and thus brings experience with corporate governance practices to his role as Chairman of the Nominating and Corporate Governance Committee of the Piedmont board of directors. As author of books on integrity and ethical decision-making in business, Mr. Cantrell offers unique insight into issues influencing our company culture and business practices.

5

Barbara B. Lang joined our board of directors on January 2, 2015. Ms. Lang is Managing Principal & CEO of Lang Strategies, LLC, a business consulting firm, located in Washington, D.C. From 2002 to 2014, Ms. Lang served as president and CEO of the D.C. Chamber of Commerce. Prior to joining the Chamber, Ms. Lang was the Vice President of Corporate Services and Chief Procurement Officer for Fannie Mae. She also had a long career with IBM where she served in several management positions in finance, administration and product forecasting. Ms. Lang has received numerous awards and accolades throughout her career, including being twice named one of  Washingtonian Magazine's  150 Most Powerful People in the Washington, D.C. region, Business Leader of the Year by the District of Columbia Building Industry Association and a Lifetime Legacy Award from Washington Business Journal. Ms. Lang also serves on the board of publicly-traded Cardinal Bank, the board of directors of the Metropolitan Washington Airports Authority, Trinity University, and Sibley Hospital Foundation.
Ms. Lang brings to the board an extensive personal network of corporate and governmental contacts in one of the Company's key operating markets. In addition, she has broad senior management expertise based on her years of experience leading the D.C. Chamber of Commerce, and her management experience with Fannie Mae and IBM. In addition, Ms. Lang has broad business, financial, and governance expertise based on her experience as a business consultant, independent director with another public company, and director of a governmental agency.
William H. Keogler, Jr. has served as a director of our company since 1998. In 1985, Mr. Keogler founded Keogler, Morgan & Company, Inc., a full-service brokerage firm, and Keogler Investment Advisory, Inc., an investment advisory firm, in which he served as Chairman of the Board, President and Chief Executive Officer. In 1997, both companies were sold to SunAmerica, Inc., a publicly traded NYSE-listed company. Mr. Keogler continued to serve as President and Chief Executive Officer of these companies until his retirement in 1998. Prior to founding Keogler, Morgan & Company, Inc., Mr. Keogler served as a director of Robinson-Humphrey Company, an Atlanta based investment banking firm.
In addition to his general business and financial expertise based on his years advising companies as an investment banker, Mr. Keogler brings to the board experience with dealing with the broker dealer community and a deep understanding of both our retail and institutional stockholders. Mr. Keogler has a unique understanding of our strategies and operations as well as our corporate culture and values as he was one of the original members of the board when Piedmont commenced operations in 1998.
Frank C. McDowell has served as a director of our company since 2008 and as Vice Chairman of the Board of Directors since 2010. From 1995 until his retirement in 2004, Mr. McDowell served as President, Chief Executive Officer and Director of BRE Properties, Inc., a self-administered equity REIT, which owns and operates income-producing properties, primarily apartments, in selected Western U.S. markets. From 1992 to 1995, Mr. McDowell was Chairman and CEO of Cardinal Realty, the nation’s fifteenth largest apartment management company and the nineteenth largest owner of multifamily housing at the time. Before joining Cardinal Realty, Mr. McDowell had served as a senior executive and head of real estate at First Interstate Bank of Texas and Allied Bancshares, where he had responsibility for regional management, real estate lending and problem asset workout. Additionally, Mr. McDowell served as a director of Eagle Hospitality Trust (NYSE: EHP) from 2006 to 2008 and was a licensed CPA in Texas from 1973 to 1993.
Mr. McDowell brings to the board extensive experience as a CEO of an approximate 500-employee, public company within the real estate sector as a result of serving as CEO of BRE Properties and as a result of his experience as head of real estate for First Interstate Bank of Texas and Allied Bancshares. He is very familiar with the public markets, including dealing with analysts and institutional investors as well as an in-depth working knowledge of various financial structures and the capital raising process. In addition he has expertise in strategic planning, establishing and managing compensation for senior real estate executives, and in other financial matters given his background as a CPA. These skills make him well suited to serve as Chairman of the Compensation Committee.
Raymond G. Milnes, Jr. has served as a director of our company since 2011. He retired as a partner from the accounting firm of KPMG LLP in 2011 where he had served as the National Sector Leader for the Building, Construction and Real Estate Practice for fourteen years. Mr. Milnes was employed by KPMG for 38 years and has extensive accounting, auditing, and advisory experience in all sectors of the real estate and construction industries, including real estate investment funds, real estate investment trusts, developers, operating properties, and syndicates of private and public real estate partnerships. Mr. Milnes has served as the lead audit partner or account executive for several of KPMG's largest real estate and construction clients, including both domestic and global clients and has been a frequent speaker and panelist on current trends in the building, construction, and real estate industry and has contributed to numerous real estate industry publications. In addition to his national role with KPMG, Mr. Milnes also has been an associate member of the Board of Governors of NAREIT, serves on the Advisory Board of the The Real Estate Center of DePaul University, and has been a member of the The Real Estate Roundtable President's Council. He has a BS in Accounting from the University of Detroit and is a licensed CPA.

6

Mr. Milnes brings to the board real estate specific financial knowledge and experience including dealing with complex financial and accounting related issues based on his many years serving as a KPMG partner and his leadership roles within the KPMG organization. Additionally, he has an in-depth knowledge of the workings of the SEC and risk management expertise as well as contacts at other real estate firms. Finally, his financial expertise makes him well qualified to serve as Chairman of the Audit Committee and an audit committee financial expert.

Donald A. Miller, CFA, has served as the Chief Executive Officer, President, and a member of the board of directors of Piedmont Office Realty Trust since 2007. From 2003 to 2007, Mr. Miller was the head of real estate activities at Wells Real Estate Funds, Inc. In such capacity, he was responsible for directing all aspects of the acquisitions, asset management, dispositions, property management, and construction groups. From 2001 to 2003, Mr. Miller headed the U.S. equity real estate operations of Lend Lease, a leading international commercial real estate property group where he had worked since 1994. Prior to Lend Lease, Mr. Miller was responsible for regional acquisitions for Prentiss Properties Realty Advisors, a predecessor entity to Prentiss Properties Trust, a publicly traded REIT (which was acquired by Brandywine Realty Trust in 2005). Earlier in his career, Mr. Miller worked in the pension investment management department of Delta Air Lines and was responsible for real estate and international equity investment programs. Mr. Miller is also a Chartered Financial Analyst. He received a B.A. from Furman University in Greenville, South Carolina. He currently sits on the board of directors of Pacolet Milliken Enterprises, a Spartanburg South Carolina investment company specializing in real estate and energy. He is on the Board of Governors for the National Association of Real Estate Investment Trusts (NAREIT), a member of the Urban Land Institute (ULI), and the National Association of Industrial and Office Properties (NAIOP).
Through his experience serving as Chief Real Estate Officer for Wells Real Estate Funds as well as his work at Lend Lease, Prentiss Properties, and managing real estate investments for Delta Air Lines, Mr. Miller brings to the board almost 30 years of experience in dealing with virtually all aspects of real estate acquisition, financing, management, leasing, disposition as well as both portfolio and asset management experience. He also has an extensive personal network of contacts throughout the real estate industry given his involvement in ULI, NAIOP and NAREIT. Mr. Miller is very knowledgeable about each of the individual geographic markets in which Piedmont currently owns or may own property. In addition, he has extensive financial expertise given his Chartered Financial Analyst designation and great insight into our strategies and operations as well as our corporate culture and values given his many years of service to Piedmont.
Jeffrey L. Swope has served as a director of our company since 2008. In 1991, Mr. Swope formed Champion Partners Ltd., a nationwide developer and investor of office, industrial and retail properties, where he has served as Managing Partner and Chief Executive Officer since 1991. In addition, during 2011, Mr. Swope co-founded Champion Private Equity, a private real estate capital and investment company. He also serves as a member of the University of Texas at Austin Business School Advisory Council.
As a nationwide developer of real estate property, Mr. Swope has handled the acquisition, financing, leasing and management of over 50 million square feet of real estate during his approximately 40 year career in the commercial real estate industry and thus brings extensive experience in virtually all aspects of real estate and a wealth of knowledge regarding the individual geographic markets in which Piedmont currently owns or may own property. His development expertise will also be beneficial to Piedmont as we pursue various development and redevelopment strategies. His deep real estate and financing experience makes him well suited to serve as Chairman of the Capital Committee. He also has an extensive personal network of contacts throughout the real estate industry given his involvement in many industry groups such as the Urban Land Institute (ULI), the National Association of Industrial and Office Properties (NAIOP), and his involvement with the University of Texas.

Your board of directors unanimously recommends a vote “FOR ALL” nominees listed for election as directors.

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PROPOSAL II:
RATIFICATION OF ERNST & YOUNG LLP AS INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM FOR FISCAL 2015
Engagement of Ernst & Young LLP
On February 17, 2015, the Audit Committee engaged Ernst & Young LLP as our independent registered public accounting firm to audit our financial statements for the year ended December 31, 2015. This proposal asks you to ratify the selection of Ernst & Young LLP as our independent registered public accounting firm. Although we are not required to obtain such ratification from our stockholders, the board of directors believes it is good practice to do so. Notwithstanding the ratification, the Audit Committee in its discretion may select a different independent registered public accounting firm at any time during the year if it determines that the change would be in the best interests of Piedmont and our stockholders. In the event that the appointment of Ernst & Young LLP is not ratified, the Audit Committee will consider the appointment of another independent registered public accounting firm, but will not be required to appoint a different firm.
A representative of Ernst & Young LLP will be present at the Annual Meeting, will have the opportunity to make a statement and will be available to respond to appropriate questions by stockholders.
Your board of directors unanimously recommends a vote “FOR” the ratification of the appointment of Ernst & Young LLP as our independent registered public accounting firm for fiscal 2015.
Pre-Approval Policies
The Audit Committee must pre-approve all auditing services performed for us by our independent registered public accounting firm, as well as all permitted non-audit services (including the fees and terms thereof), in order to ensure that the provision of such services does not impair the registered public accounting firm’s independence. Unless a type of service to be provided by our independent registered public accounting firm has received “general” pre-approval, it will require “specific” pre-approval by the Audit Committee.
All requests or applications for services to be provided by our independent registered public accounting firm that do not require specific pre-approval by the Audit Committee will be submitted to management and must include a detailed description of the services to be rendered. Management will determine whether such services are included within the list of services that have received the general pre-approval of the Audit Committee. The Audit Committee will be informed on a timely basis of any such services rendered by our independent registered public accounting firm.
Requests or applications to provide services that require specific pre-approval by the Audit Committee will be submitted to the Audit Committee by both our independent registered public accounting firm and our chief financial officer, treasurer, or chief accounting officer, and must include a joint statement as to whether, in their view, the request or application is consistent with the SEC’s rules on registered public accounting firm independence. The chairman of the Audit Committee has been delegated the authority to specifically pre-approve all services not covered by the general pre-approval guidelines, up to an amount not to exceed $75,000 per occurrence. Amounts requiring pre-approval in excess of $75,000 per occurrence require specific pre-approval by our Audit Committee prior to engagement of Ernst & Young LLP, our current independent registered public accounting firm. All amounts specifically pre-approved by the Chairman of the Audit Committee in accordance with this policy are to be disclosed to the full Audit Committee at the next regularly scheduled meeting.
Fees Paid to Independent Registered Public Accounting Firm
The Audit Committee reviewed the audit and non-audit services performed by Ernst & Young LLP, as well as the fees charged by Ernst & Young LLP for such services. In its review of any non-audit service fees, the Audit Committee considers whether the provision of such services is compatible with maintaining the independence of Ernst & Young LLP. The aggregate fees billed to us for professional accounting services provided by Ernst & Young LLP, including the audits of our annual financial statements, for the years ended December 31, 2014 and 2013, respectively, are set forth in the table below.

 	 	 	 	 	 	 	 	
 	2014	 	2013	
Audit Fees	$	937,400	
 	 	$	869,550	
 	
Audit-Related Fees	100,000	
 	 	133,110	
 	
Tax Fees	—	
 	 	—	
 	
All Other Fees	—	
 	 	—	
 	
Total	$	1,037,400	
 	 	$	1,002,660	

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For purposes of the preceding table, the professional fees are classified as follows:
 	 	
•	Audit Fees—These are fees for professional services performed for the audit of our annual financial statements and the required review of quarterly financial statements and other procedures to be performed by the independent registered public accounting firm to be able to form an opinion on our consolidated financial statements. These fees also cover services that are normally provided by independent registered public accounting firms in connection with statutory and regulatory filings or engagements, and services that generally only the independent registered public accounting firm reasonably can provide, such as services associated with filing registration statements, periodic reports, and other filings with the SEC.	
 	 	
•	Audit-Related Fees—These are fees for assurance and related services that traditionally are performed by independent registered public accounting firms, such as due diligence related to acquisitions and dispositions, attestation services that are not required by statute or regulation, internal control reviews, non recurring agreed-upon procedures and other professional fees associated with transactional activity.	
 	 	
•	Tax Fees—These are fees for all professional services performed by professional staff in our independent registered public accounting firm’s tax division, except those services related to the audit of our financial statements. These include fees for tax compliance filings, tax planning, and tax advice, including federal, state, and local issues. Services may also include assistance with tax notices, audits and appeals before the Internal Revenue Service and similar state and local agencies.	
 	 	
•	All Other Fees—These are fees for other permissible work performed that do not meet the above-described categories, including assistance with internal audit plans and risk assessments.	
For the year ended December 31, 2014, all services rendered by Ernst & Young LLP were pre-approved by the Audit Committee in accordance with the policies and procedures described above.

9

PROPOSAL III—ADVISORY VOTE TO APPROVE NAMED EXECUTIVE OFFICER COMPENSATION
Pay that reflects performance and alignment of pay with the long-term interests of our stockholders are key principles that underlie our compensation program. In accordance with the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), stockholders have the opportunity to vote, on an advisory basis, on the compensation of our named executive officers. This is often referred to as a say on pay, and provides you, as a stockholder, with the ability to cast a vote with respect to our 2014 executive compensation programs and policies and the compensation paid to the named executive officers as disclosed in this proxy statement through the following resolution:
“RESOLVED, that the stockholders approve the compensation of the named executive officers, as described in the Compensation Discussion and Analysis section and in the compensation tables and accompanying narrative disclosure in this proxy statement.”
As discussed in "Executive Compensation --- Compensation Discussion and Analysis" below, the compensation paid to our named executive officers is designed to meet the following objectives:
 	 	
•	to attract and retain candidates capable of performing at the highest levels of our industry;	
 	 	
•	to create and maintain a performance-focused culture, by rewarding outstanding company and individual performance based upon objective predetermined metrics;	
 	 	
•	to reflect the qualifications, skills, experience and responsibilities of each named executive officer;	
 	 	
•	to link incentive compensation levels with the creation of stockholder value;	
 	 	
•	to align the interests of our executives and stockholders by creating opportunities and incentives for executives to increase their equity ownership in us; and	
 	 	
•	to motivate our executives to manage our business to meet and appropriately balance our short- and long-term objectives.	
Although the vote is non-binding, the Compensation Committee will review the voting results and consider the outcome in making decisions about future compensation arrangements for our named executive officers.
As required by the Dodd-Frank Act, this vote does not overrule any decisions by the board of directors, will not create or imply any change to or any additional fiduciary duties of the board of directors and will not restrict or limit the ability of stockholders generally to make proposals for inclusion in proxy materials related to executive compensation.
Your board of directors unanimously recommends a vote “FOR”
the approval, on an advisory basis, of the compensation of our named executive officers.

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CERTAIN INFORMATION ABOUT MANAGEMENT
Executive Officers

 	 	 	
Name	Age	Position(s)	
Donald A. Miller, CFA	52	Chief Executive Officer, President and Director	
Robert E. Bowers	58	Executive Vice President and Chief Financial Officer	
Laura P. Moon	44	Senior Vice President and Chief Accounting Officer	
Raymond L. Owens	56	Executive Vice President—Capital Markets	
Joseph H. Pangburn	54	Executive Vice President—Southwest Region	
Thomas R. Prescott	57	Executive Vice President—Midwest Region	
Carroll A. Reddic, IV	49	Executive Vice President—Real Estate Operations, Assistant Secretary	
Robert K. Wiberg	59	Executive Vice President—Mid-Atlantic Region and Head of Development	
________________________
The following is detailed information about each of our executive officers other than Mr. Miller whose biographical information is included under “Proposal I: Election of Directors” above.
Robert E. Bowers has served as our Chief Financial Officer since 2007. A veteran of the public financial services industry, including having served as Chief Financial Officer for three other public companies, Mr. Bowers’ experience includes investor relations, debt and capital offerings, mergers and acquisitions, asset allocation, financial management and strategic planning. Mr. Bowers is also responsible for management of our information technology, risk management and human resource functions. From 2004 until 2007, he served as Chief Financial Officer and Vice President of Wells REF and was a Senior Vice President of Wells Capital. Mr. Bowers was Chief Financial Officer and Director of NetBank, Inc. (formerly NASDAQ: NTBK) from 1997 to 2002. From 1984 to 1996, Mr. Bowers was Chief Financial Officer and Director of Stockholder Systems, Inc. (formerly NASDAQ: SSIAA), an Atlanta, Georgia-based financial applications company and its successor, CheckFree Corporation (formerly NASDAQ:CKFR). Mr. Bowers has provided strategic financial counsel to a range of organizations, including venture capital funds, public corporations and businesses considering listing on a national securities exchange. Mr. Bowers is a member of NAREIT and a CPA who began his career in 1978 with Arthur Andersen & Company in Atlanta.
Laura P. Moon has served as our Senior Vice President and Chief Accounting Officer since 2007. She has over twenty years of experience with accounting and reporting for public companies and at Piedmont she is responsible for all general ledger accounting, SEC and tax reporting functions. Prior to joining us, Ms. Moon had been Vice President and Chief Accounting Officer at Wells Real Estate Funds since 2005 where she had responsibility for all general ledger accounting, financial and tax reporting, and internal audit supervision for 19 public registrants as well as several private real estate partnerships. From 2003 to 2005, Ms. Moon served as Senior Director of Financial Planning and Analysis for ChoicePoint, Inc. (formerly NYSE: CPS) (since February 2008, a wholly-owned subsidiary of Reed Elsevier) and from 1999 to 2006 was Chief Accounting Officer for NetBank, Inc. (formerly NASDAQ: NTBK). Ms. Moon is a CPA and began her career in 1991 with Deloitte & Touche LLP.
Raymond L. Owens has served as our Executive Vice President—Capital Markets since 2007. In this capacity, Mr. Owens is responsible for acquisition, disposition and financing activities of our company. Prior to joining us, Mr. Owens spent five years as a Managing Director—Capital Markets for Wells Real Estate Funds, where he oversaw its western regional acquisition team and its real estate finance team. Prior to joining Wells Real Estate Funds, Mr. Owens served as Senior Vice President for PM Realty Group from 1997 to 2002, overseeing all management operations in Atlanta, Washington, D.C., Chicago, and New York. Before joining PM Realty Group, Mr. Owens served as Vice President at General Electric Asset Management, where he managed and negotiated dispositions as well as third-party, nonrecourse financing for real estate assets. Mr. Owens is a member of the National Association of Real Estate Investment Managers (NAREIM), the National Association of Industrial & Office Properties (NAIOP), and the Urban Land Institute (ULI).
Joseph H. Pangburn was promoted to Executive Vice President - Southwest Region during 2014. In this capacity, he is responsible for overseeing Piedmont's Southwest Region operations, principally in Texas and Arizona, including all development, leasing, asset management and transactional activity exclusive to Piedmont's portfolio. A native of Dallas, Mr. Pangburn has approximately 30 years of real estate experience, including acquisitions, asset management, development, real estate loan restructuring, and workouts, most notably in the office and industrial sectors. Prior to his promotion in 2014, Mr. Pangburn had been responsible for the leasing and asset management activities for the Company's Western Region portfolio since 2007. From 2001 to 2007, Mr. Pangburn was Director of Acquisitions at Wells Real Estate Funds and his career also includes tenures at Lend Lease Real Estate Investments, Inc. and Prentiss Properties Limited, Inc. Throughout his career, his

11

activities and experience have been concentrated on properties located in the western United States, and specifically in Texas. Mr. Pangburn is a member of the Office Development Council of the Urban Land Institute.
Thomas R. Prescott joined Piedmont in 2014 as Executive Vice President for the Midwest Region and is responsible for all leasing, asset management, acquisitions, dispositions and development projects for Piedmont's Midwest Region, located primarily in metropolitan Chicago and Minneapolis. From 2009 to 2014, Mr. Prescott served as President of Metropolis Investment Holdings Inc., a Chicago-based investor and owner of Class A office properties, where he was responsible for overseeing the leasing, management and overall performance of the firm's 6 million square foot portfolio. Mr. Prescott has had a long career focused on the acquisition, leasing, development, and management of office, industrial and mixed-use properties throughout the United States and Canada, including tenures at Forest City Enterprises and Higgins Development Partners (formerly Walsh, Higgins & Company). Earlier in his career, he also served as Senior Vice President of The Shaw Company where he oversaw the firm's brokerage and management operations and developed multiple office buildings, hotels, a research park and a 700-unit retirement community. Mr. Prescott is a recognized real estate industry leader and a member of NAIOP and the Urban Land Institute.
Carroll A. (“Bo”) Reddic, IV has served as our Executive Vice President for Real Estate Operations since 2007. His responsibilities include leading our company’s asset and property management divisions. Additionally, he provides oversight to our company’s construction management and tenant relationship functions. From 2005 to 2007, Mr. Reddic was a Managing Director in the Asset Management Department at Wells Real Estate Funds, where he was responsible for supervising the firm’s asset management function in its Midwest and South regions. Prior to joining Wells Real Estate Funds, Mr. Reddic was an Executive Director with Morgan Stanley (including the predecessor companies of The Yarmouth Group and Lend Lease Real Estate Investments) from 1990 to 2004, where he served as portfolio manager for domestic commingled investment funds and international separate account portfolios. Mr. Reddic is a member of the National Association of Industrial & Office Properties (NAIOP), the Urban Land Institute (ULI), BOMA and CoreNet Global.
Robert K. Wiberg joined Piedmont in 2012 as Executive Vice President for the Mid-Atlantic Region and Head of Development. Mr. Wiberg is responsible for all leasing, property management, asset management, acquisitions and dispositions in the Mid-Atlantic Region, as well as all development projects nationwide. Piedmont's Mid-Atlantic Region is comprised of over three million square feet of office space located primarily in the metropolitan Washington, D.C. area. From 2006 to October of 2012, Mr. Wiberg was employed by Brandywine Realty Trust as EVP for their Metro Washington, D.C. region and also oversaw their California markets for a portion of that time. From 1997 to 2006, he was EVP for the Mid-Atlantic region for Prentiss Properties. Mr. Wiberg has had a long career focused on office leasing and development, including tenures at Cadillac Fairview and Coldwell Banker (now CBRE), garnering expertise in the Los Angeles, CA; Dallas, TX; and Atlanta, GA markets, among others. As a recognized industry leader, he has served on the board of directors of the Northern Virginia Chapter of NAIOP and currently serves on the board of the Arlington Partnership for Affordable Housing. Mr. Wiberg earned his B.A. from Cornell University, an MBA from the University of California at Berkeley, and a Master of City and Regional Planning degree from Harvard University.
There are no family relationships among our directors or executive officers. Officers are elected annually by our board of directors. The board of directors retains the power to remove any officer at any time. 

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INFORMATION REGARDING THE BOARD OF DIRECTORS AND COMMITTEES
Leadership Structure
Our nine member board of directors is currently comprised of eight independent members and our Chief Executive Officer. Each of our board members is subject to re-election on an annual basis; however, Mr. Moss was reappointed to serve as a director on January 13, 2015 to fill the vacancy that resulted from the unexpected death of our former Chairman, W. Wayne Woody, in January of 2015. Mr. Moss will not stand for re-election and the board is currently recruiting a replacement director.
We do not divide our directors into classes or stagger terms. Mr. Buchanan was elected Chairman of the Board by the board of directors in February of 2015 following Mr. Woody's death. The Chairman is re-elected by the board of directors on an annual basis. The board currently has no formal policy with respect to the separation of the positions of Chairman of the Board and Chief Executive Officer; however, the board believes that the separation of the positions is in the best interests of Piedmont as it provides leadership for the independent board and the benefit of additional support, experience and oversight for the management team.
Board Committees
Our board of directors has established four standing committees: the Audit Committee, the Compensation Committee, the Nominating and Corporate Governance Committee, and the Capital Committee. Each of the Audit Committee, the Compensation Committee and the Nominating and Corporate Governance Committee complies with the listing requirements and other rules and regulations of the NYSE, as amended or modified from time to time. All members of the committees described below are independent as such term is defined in the NYSE’s listing standards and as affirmatively determined by our board of directors.

 	 	 	 	 	
Board Committee	 	Chairman	 	Members	
 	 	 	
Audit Committee	 	Raymond G. Milnes, Jr.*	 	William H. Keogler, Jr.
Michael R. Buchanan
Donald S. Moss**	
 	 	 	
Compensation Committee	 	Frank C. McDowell	 	William H. Keogler, Jr.
Barbara B. Lang
Jeffrey L. Swope	
 	 	 	
Nominating & Corporate Governance Committee	 	Wesley E. Cantrell	 	Barbara B. Lang
Frank C. McDowell
Donald S. Moss**	
 	 	 	
Capital Committee	 	Jeffrey L. Swope	 	Michael R. Buchanan
Wesley E. Cantrell
Raymond G. Milnes, Jr
	
________________________

*	Designated as an Audit Committee financial expert.	
**	Mr. Moss will retire from our Board effective May 12, 2015, and the board is actively recruiting a replacement.	
The Audit Committee
Our board of directors has established a standing Audit Committee comprised of Messrs. Milnes (Chairman), Buchanan, Moss, and Keogler. Each member of the Audit Committee meets the independence, experience, financial literacy and expertise requirements of the NYSE, the Sarbanes-Oxley Act of 2002, the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and applicable rules and regulations of the SEC, all as in effect from time to time, as well as the independent director requirements set forth in our Corporate Governance Guidelines. The board of directors has determined that Mr. Milnes satisfies the requirements of an “audit committee financial expert” as defined by the rules and regulations of the SEC.
The Audit Committee operates pursuant to a written charter adopted by our board of directors, a copy of which is available on our website at  www.piedmontreit.com . The primary responsibilities of the Audit Committee, as set forth in the committee’s charter, include the following:

13

 	 	
•	assisting the board of directors in the oversight of (1) the integrity of our financial statements; (2) our compliance with legal and regulatory requirements; (3) the system of internal controls which our management has established; (4) the qualification, independence and performance of our independent registered public accounting firm; and (5) the performance of our internal audit function;	
 	 	
•	maintaining a free and open means of communication among our independent registered public accounting firm, our management, our internal audit department and our board of directors;	
 	 	
•	Review and discuss with management the Company’s earnings and dividend press releases, as well as financial information, earnings or dividend guidance provided to the analysts and rating agencies;	
 	 	
•	reviewing and discussing with management and the independent registered public accounting firm our annual audited financial statements, and, based upon such discussions, recommending to the board of directors that our audited financial statements be included in our annual report on Form 10-K;	
 	 	
•	reviewing and discussing with management and the independent registered public accounting firm our quarterly financial statements and each of our quarterly reports on Form 10-Q;	
 	 	
•	preparing an Audit Committee report for inclusion in our annual proxy statements for our annual stockholder meetings;	
 	 	
•	appointing, compensating, overseeing, retaining, discharging and replacing our independent registered public accounting firm;	
 	 	
•	pre-approving all auditing services, and all permitted non-audit services, performed for us by the independent registered public accounting firm; and	
 	 	
•	overseeing our code of business conduct and ethics.	
During 2014, the Audit Committee held six meetings.
The Compensation Committee
The board of directors has established a standing Compensation Committee. The members of the Compensation Committee are Messrs. McDowell (Chairman), Keogler, Swope, and Ms. Lang. The members of the Compensation Committee are all independent directors who meet the current independence requirements of the NYSE, as well as the independent director requirements set forth in our Corporate Governance Guidelines and applicable rules and regulations of the SEC. For additional information about the Compensation Committee’s processes and the role of executive officers and compensation consultants in determining compensation, see “Executive Compensation.” The Compensation Committee operates pursuant a written charter adopted by our board of directors, a copy of which is available on our website at www.piedmontreit.com.  The primary responsibilities of the Compensation Committee, as set forth in the committee's charter include the following:
 	 	
•	setting the overall compensation strategy and compensation policies for our executive officers and directors;	
 	 	
•	reviewing and approving corporate goals and objectives relevant to the compensation of our Chief Executive Officer;	
 	 	
•	evaluating the Chief Executive Officer’s performance in light of those goals and objectives and, either as a committee or together with the other independent directors, determining and approving the Chief Executive Officer’s compensation based on this evaluation;	
 	 	
•	reviewing and approving the compensation of other executive officers or making recommendations to the board with respect to such compensation;	
 	 	
•	making recommendations to the board with respect to the compensation of all non-employee directors, including board and committee retainers, meeting fees, equity-based compensation and such other compensation as the committee may deem advisable;	
 	 	
•	reviewing and approving grants under all incentive-based compensation plans and equity-based plans and approving any new compensation plans or material changes to existing plans;	
 	 	
•	administering our 2007 Omnibus Incentive Plan;	
 	 	
•	reviewing and approving any employment agreements, change in control agreements or severance agreements proposed to be entered into with any current or former executive officer;	
 	 	
•	overseeing and assisting in preparing the Compensation Discussion and Analysis and recommending it for inclusion in our proxy statement and/or annual report on Form 10-K; and	

14

 	 	
•	preparing a Compensation Committee report, as required by applicable SEC regulations, to be included in our proxy statements and/or annual report on Form 10-K.	
Our Compensation Committee met four times during 2014.

The Nominating and Corporate Governance Committee

Our board of directors has established a standing Nominating and Corporate Governance Committee, which is comprised of Messrs. Cantrell (Chairman), McDowell, Moss, and Ms. Lang. The members of the Nominating and Corporate Governance Committee are all independent directors who meet the current independence requirements of the NYSE, as well as the independent director requirements set forth in our Corporate Governance Guidelines. The Nominating and Corporate Governance Committee operates pursuant to a written charter adopted by our board of directors, a copy of which is available on our website at  www.piedmontreit.com . The primary responsibilities of the Nominating and Corporate Governance Committee, as set forth in the committee’s charter include:
 	 	
•	identifying individuals qualified to serve on the board of directors, consistent with criteria approved by the board of directors, and recommending that the board of directors select a slate of director nominees for election by our stockholders at the annual meeting of our stockholders;	
 	 	
•	evaluating the independence of candidates for the board of directors;	
 	 	
•	developing and implementing the process necessary to identify prospective members of our board of directors;	
 	 	
•	determining the advisability of retaining any search firm or consultant to assist in the identification and evaluation of candidates for membership on the board of directors;	
 	 	
•	overseeing an annual evaluation of the board of directors, each of the committees of the board and management;	
 	 	
•	developing and recommending to our board of directors a set of corporate governance principles and policies; and	
 	 	
•	periodically reviewing our corporate governance structures and procedures and suggesting improvements thereto to our board of directors.	

The Nominating and Corporate Governance Committee is also responsible for reviewing stockholder communications and responding to inquiries concerning our governance practices, business ethics and corporate conduct. During 2014, the Nominating and Corporate Governance Committee held four meetings.
The Capital Committee
Our board of directors has established a Capital Committee, which is comprised of Messrs. Swope (Chairman), Buchanan, Cantrell, and Milnes. The primary responsibilities of the Capital Committee include:
 	 	
•	reviewing and advising the board of directors on our overall financial performance, including issues related to capital structure, operating earnings, dividends and budgetary and reporting processes; and	
 	 	
•	reviewing and advising the board of directors on investment criteria and acquisition and disposition policies, general economic environment in various real estate markets, existing or prospective properties or tenants, and portfolio diversification goals.	
During 2014, the Capital Committee met four times.
Board Membership Criteria
The Nominating and Corporate Governance Committee annually reviews with the board of directors the appropriate experience, skills and characteristics required of board members in the context of the current membership of the board as well as in the context of potential turnover of the existing board. The review includes consideration of the following characteristics in the context of the perceived needs of the board at the time:
•financial expertise;
•chief executive or chief financial officer experience (with a preference for REIT-specific experience);
•public company experience;

15

•industry specific knowledge;
•strategic planning experience or expertise;
•experience mentoring top level leaders;
•general management experience;
•real estate development/ construction expertise;
•investment banking experience;
•racial and/or gender diversity;
•legal expertise;
•risk management expertise;
•marketing expertise; and
•international experience.

The board considers all of these characteristics when assessing candidates for board membership. Other considerations included in both the annual assessment of existing members and the assessment of new candidates include the candidate or incumbent’s status as an independent director, the ability of the candidate or incumbent to attend board meetings regularly and to devote an appropriate amount of effort in preparation for those meetings, and whether the candidate’s knowledge and experience of a particular aspect of the real estate industry or particular skill set is additive to the existing experience or skill sets of incumbent members of the board. While we have not adopted a formal policy regarding diversity of our board, in selecting nominees, the Nominating and Corporate Governance Committee considers the diversity of experience (particularly with regard to different facets of the real estate industry), qualifications, attributes and skills that a potential nominee would bring to the board. Although a number of our directors are retired, it is also expected that independent directors nominated by the board of directors shall be individuals who possess a reputation and hold positions or affiliations befitting a director of a large publicly held company and are active in their occupation, profession, or community.

During 2014, the board of directors amended our Corporate Governance Guidelines to limit a non-employee director's term of service to 15 years. The amended Corporate Governance Guidelines provide that the board of directors will not nominate for re-election any non-employee director who has served 15 years or more prior to the applicable election, subject to exceptions granted by the board of directors. In adopting this amendment to the Corporate Governance Guidelines, the board determined it was in Piedmont's best interest or provide a transition period in implementing this term limit with respect to Mr. Donald S. Moss and Mr. William H. Keogler, Jr., each of whom has served on the board of directors in excess of 15 years. The board of directors exempted Mr. Keogler from this term limit until September 30, 2015. As part of his nomination for election at the Annual Meeting, Mr. Keogler has submitted a resignation from the board effective as of September 30, 2015. Mr. Moss resigned from the board of directors on July 30, 2014, effective as of December 31, 2014; however, Mr. Moss was reappointed to serve as a director on January 13, 2015 to fill the vacancy that resulted from the death of Chairman of the Board W. Wayne Woody on January 9, 2015. Mr. Moss is not standing for re-election at the Annual Meeting.

Selection of Directors
The board of directors is responsible for selecting its own nominees and recommending them for election by the stockholders. The board delegates the screening process necessary to identify qualified candidates to the Nominating and Corporate Governance Committee, in consultation with the Chief Executive Officer.
The Nominating and Corporate Governance Committee annually reviews director suitability and the continuing composition of the board of directors and is currently actively reviewing candidates for a replacement board member. Once a suitable candidate is identified, the Nominating and Corporate Governance then recommends director nominees who are voted on by the full board of directors. All director nominees then stand for election by the stockholders annually.
In recommending director nominees to the board of directors, the Nominating and Corporate Governance Committee solicits candidate recommendations from its own members, other directors, and members of our management. The Nominating and Corporate Governance Committee may engage the services of a search firm to assist in identifying potential director nominees. The Nominating and Corporate Governance Committee will also consider recommendations for director candidates made by stockholders and other interested persons. Candidates for director must meet the established director criteria set forth above. In addition, under our Bylaws, stockholders may directly nominate candidates for election as directors. In order for a stockholder to make a nomination, the stockholder must satisfy the procedural requirements for such nomination as provided in Article II, Section 12 of our Bylaws. Any stockholder may request a copy of our Bylaws free of charge by writing to our Secretary at our corporate address.

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In evaluating candidates for director, the Nominating and Corporate Governance Committee will consider each candidate without regard to the source of the recommendation and take into account those factors that the Nominating and Corporate Governance Committee determines are relevant, including the factors discussed above under "Board Membership Criteria".

Board Self-Evaluation Process

Annually, the board of directors undertakes a robust self-evaluation process which is administered by the Nominating and Corporate Governance Committee with the assistance of outside counsel. Members of the Board complete a detailed, confidential questionnaire which provides for ratings in key areas and also seeks subjective comments. Outside counsel collects and analyzes the data and reports the results and information compiled from the questionnaires to the Nominating and Corporate Governance Committee. Comments pertaining to particular Board Committees are shared with each respective Committee chairperson, and comments regarding the full Board are shared with the full Board. Matters requiring follow up are addressed by the Chairman of the Nominative and Corporate Governance Committee, the Chairman of the Board, or Chairman of the applicable Board Committee, as appropriate.

Majority Voting Policy

Our Corporate Governance Guidelines include a majority voting policy for the election of non-employee directors. Pursuant to this policy, in an uncontested election of directors, any non-employee nominee who receives a greater number of votes withheld from his or her election than votes for his or her election will promptly tender his or her resignation for consideration by the Nominating and Corporate Governance Committee. The Nominating and Corporate Governance Committee will promptly consider the resignation offer and make a recommendation to the board of directors. The board will act on the Nominating and Corporate Governance Committee's recommendation within 90 days following the certification of the stockholder vote. We will publicly disclose, in a Form 8-K furnished to the SEC, the board's decision regarding whether to accept the resignation offer. Any director who tenders his or her resignation will not participate in the committee or board deliberations regarding such matter.
Risk Oversight
The board of directors is involved in risk oversight through direct decision-making authority on significant matters as well as through the oversight of management and appropriate advice and counsel from legal, financial, and compensation advisors. In particular, the board of directors manages risk by reviewing and discussing periodic reports with management including, but not limited to, reports detailing Piedmont’s concentrations of geographic, tenant, industry, and lease expiration risk. Through its various committees, the board monitors acquisition, disposition, leasing and investing activities and has delegated authority to the appropriate levels of management to carry out such activities with appropriate governance reporting at respective committee meetings.
In accordance with its charter, the Audit Committee also monitors major issues regarding accounting principles and financial statement presentation, including any significant changes in the application of accounting principles, and major issues regarding the adequacy of Piedmont’s internal controls and analyses prepared by management and/or the independent registered public accounting firm setting forth significant financial reporting issues and judgments made in connection with the preparation of the financial statements. In addition, the Audit Committee follows the effect of regulatory and accounting initiatives, as well as off-balance sheet structures, on Piedmont’s financial statements and the type and presentation of financial information to be included in earnings press releases, reports, and earnings guidance provided to analysts and rating agencies. The Audit Committee reviews and discusses with management Piedmont’s major financial risk exposures and the steps management has taken to monitor and control such exposures. The Audit Committee is also periodically briefed on Piedmont’s processes and policies with respect to risk assessment and risk management and the Audit Committee Chairman is interviewed in conjunction with Piedmont’s annual risk assessment process. Finally, the Audit Committee is periodically briefed on insurance coverage limits, any significant change in Piedmont’s insurance policies, monitoring of Piedmont’s code of ethics, whistleblower policy, and insider trading policies, as well as quarterly REIT test and debt covenant compliance calculations.
Director Independence
The NYSE requires each NYSE-listed company to have a majority of independent board members and a nominating/corporate governance committee, compensation committee and audit committee each comprised solely of independent directors. Our board of directors has adopted the NYSE independence standards as part of its Corporate Governance Guidelines.
In accordance with NYSE rules, the board of directors affirmatively determined that each of the following directors is independent within the meaning of the NYSE’s director independence standards:

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Michael R. Buchanan
Wesley E. Cantrell
William H. Keogler, Jr.
Barbara B. Lang
Frank C. McDowell
Raymond G. Milnes, Jr.
Donald S. Moss
Jeffrey L. Swope
The persons listed above include all of our current directors, other than Donald A. Miller, CFA, our President and Chief Executive Officer.
The board of directors has also determined that each of the current members of our Audit, Compensation, and Nominating and Corporate Governance Committees is independent within the meaning the NYSE’s director independence standards applicable to members of such committees. Additionally, our Audit Committee members satisfy the enhanced independence standards set forth in Rule 10A-3(b)(1)(i) under the Exchange Act and NYSE listing standards.
Attendance
Our board of directors met eight times during 2014, either in person or telephonically, and each member of the board of directors attended in excess of 75% of the 2014 board and committee meetings on which such director served.
We do not have a formal policy with regard to board member attendance at our annual stockholder meetings. In 2014, all of the members of our board of directors attended the annual meeting of stockholders either telephonically or in person.
Communications with Stockholders or Other Interested Parties
We have established several means for stockholders or other interested parties to communicate their concerns to the board of directors. If the concern relates to our financial statements, accounting practices or internal controls, the concerns should be submitted in writing to the Chairman of our Audit Committee in care of our Secretary at our headquarters address. If the concern relates to our governance practices, business ethics or corporate conduct, the concern may be submitted in writing to the Chairman of our Nominating and Corporate Governance Committee in care of our Secretary at our headquarters address. If a stockholder is uncertain as to which category his or her concern relates, he or she may communicate it to any one of the independent directors in care of our Secretary at our headquarters address. Stockholders or other interested parties who wish to communicate with our Chairman or with the non-management directors as a group may do so by writing to our Chairman at our headquarters address.
Corporate Governance Guidelines and Code of Ethics
Our board of directors, upon the recommendation of the Nominating and Corporate Governance Committee, has adopted Corporate Governance Guidelines establishing a common set of expectations to assist the board of directors in performing their responsibilities. The Corporate Governance Guidelines, which meet the requirements of the NYSE’s listing standards, address a number of topics, including, among other things, director qualification standards, director responsibilities, the responsibilities and composition of the board committees, director access to management and independent advisers, director compensation, and evaluations of the performance of the board. Our board of directors has also adopted a Code of Ethics, including a conflicts of interest policy, that applies to all of our directors and executive officers including our principal executive officer, principal financial officer, principal accounting officer and persons performing similar functions. The Code of Ethics meets the requirements of the rules and regulations of the SEC. A copy of our Corporate Governance Guidelines and our Code of Ethics is available on our website at  www.piedmontreit.com . Any amendments to, or waivers of, the Code of Ethics will be disclosed on our website promptly following the date of such amendment or waivers.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

The following Compensation Discussion and Analysis explains our compensation philosophy, objectives, policies and practices and the decisions made with respect to compensation for 2014 for our Chief Executive Officer, Chief Financial Officer and our three other most highly compensated executive officers, whom we refer to collectively as our Named Executive Officers (“NEOs”), as determined in accordance with applicable SEC rules.

Executive Summary

2014 was a pivotal year for Piedmont as we began to see improving financial metrics as a result of re-leasing the majority of the portfolio over the last several years. Total leasing volume for the year totaled 2.2 million square feet, exceeding the overall 2014 leasing goal of 1.7 million square feet. Our ambitious goal for new leasing fell approximately 14% short of objective; however, renewal leasing far exceeded stated targets. Core FFO (which is one of the performance metrics for our incentive plans) for the year ended December 31, 2014 was $1.49 per share, near the top of the original stated range for the year of $1.40 to $1.50. Overall transactional activity was robust, with acquisition volume exceeding stated targets by approximately 25%, offset by a shortfall in disposition volume.

Reported occupancy improved from 87% at the beginning of the year to 88% at year end and average lease term remained an impressive 7.1 years. From a balance sheet management perspective, we refinanced $575 million of maturing secured debt during 2014, successfully reducing the amount of secured debt in the portfolio by almost 50%. In addition, we achieved favorable credit spreads on new debt facilities entered into during the year and kept our debt to gross asset value ratio below our internally defined maximum of 40%.
Total Stockholder Return ("TSR") relative to our peer group (see Market Reference Data below) also improved during 2014. The re-leasing of the majority of the portfolio over the last several years temporarily negatively impacted our Property Net Operating Income ("Property NOI"), and consequently, our stock price. However, as rental abatement periods related to certain significant renewals and replacement leases began to expire during 2014, Property NOI began to improve. This demonstration that many of our largest leasing challenges are now behind us, combined with the performance from a Core FFO perspective mentioned above, helped to contribute to slightly better than median TSR performance during 2014.
For 2014, our Compensation Committee and the board of directors acknowledged the pivotal nature of the year and felt it appropriate to reward management for an overall excellent year of operations by unanimously endorsing an increase to the Board Discretion component that resulted in an approximate 10% increase to our NEOs Short-Term Cash Incentive Compensation Plan ("STIC Plan") awards. In assessing management's performance, the Compensation Committee and the board of directors relied heavily on the extensive set of strategic and operating goals/metrics that were approved at the beginning of the year as well as acknowledging the improvement in the Company's TSR and delivery of expected financial results. This increase, combined with the out performance in various quantitative performance measures resulted in the payment of STIC awards for 2014 that were approximately 14-23% above target for all of our NEOs other than our CEO, and approximately 33% above target for our CEO.
During the year ended December 31, 2014, our Compensation Committee also made deferred stock awards pursuant to our 2013 Long Term Incentive Compensation ("LTIC") Plan. Based on 2013 performance, we performed at above target levels for three of the four quantitative metrics for the annual deferred stock component of our LTIC plan as set forth under " Annual Deferred Stock Grant"  below. We did not meet the performance threshold for the fourth quantitative metric, Total Shareholder Return Relative to Peers for 2013. Based on the out performance for the majority of the metrics, the Compensation Committee awarded the targeted amount associated with the board of directors discretion component for the year ended December 31, 2013, resulting in a total award at 96% of target for our NEOs other than the CEO, and 98% of target for our CEO.

Consideration of “Say on Pay” Voting Results and Compensation Best Practices
In conjunction with our May 2014 annual meeting, we held a stockholder advisory vote on the compensation of our NEOs, commonly referred to as a say on pay vote. Our stockholders overwhelmingly approved the compensation of our NEOs, with approximately 90% of stockholder votes cast in favor of our say on pay resolution. Based on these results, we believe our programs are effectively designed and working well in alignment with the interests of our stockholders. Further, we believe that our compensation programs include a number of best practices such as:
 	 	
•	Our compensation of our Chief Executive Officer generally places a greater emphasis (80%) on variable, performance-based compensation than typical market practice;	

19

 	 	
•	56% of our Chief Executive Officer's pay opportunity is in the form of long-term, equity based compensation;	
 	 	
•	50% of the target for our LTIC Plan is delivered in the form of performance shares which are earned based on our multi-year TSR relative to our peers;	
 	 	
•	All of our short-term and long-term incentive programs contain caps on payouts and our Compensation Committee reserves the right to decrease payouts as they see fit;	
 	 	
•	The quantitative metrics of all of our incentive-based pay programs are tied to operational, financial, or market performance measures;	
 	 	
•	Our employment agreements with our CEO and CFO contain "clawback" provisions which require them to reimburse us for incentive-based compensation they have received if we are required to prepare an accounting restatement due to our material noncompliance, as a result of misconduct, with any financial reporting requirement under the securities laws (see " Executive Clawback Provisions " for further details);	
 	 	
•	Our NEOs and Directors are required to meet stock ownership guidelines;	
 	 	
•	Our Insider Trading Policy prohibits hedging and pledging of our stock by our executive officers and directors;	
 	 	
•	We award minimal perquisites and no supplemental executive benefits to our NEOs; and	
 	 	
•	We do not provide tax gross ups to our NEOs.	

As a result of the above considerations, our Compensation Committee decided to retain our general approach to executive compensation for 2014, which links the compensation of our NEOs to our operating objectives and emphasizes the enhancement of total stockholder return.
Compensation Philosophy and Objectives
We seek to maintain a total compensation package that provides fair, reasonable and competitive compensation for our executives while also permitting us the flexibility to differentiate actual pay based on the level of individual and organizational performance. We place significant emphasis on annual and long-term performance-based incentive compensation, including cash and equity-based incentives, which are designed to reward our executives based on the achievement of predetermined individual and company goals, including, among others, TSR relative to a comparative peer group as further described below.
The objectives of our executive compensation programs are:
 	 	
•	to attract and retain candidates capable of performing at the highest levels of our industry;	
 	 	
•	to create and maintain a performance-focused culture, by rewarding outstanding company and individual performance based upon objective predetermined metrics;	
 	 	
•	to reflect the qualifications, skills, experience and responsibilities of each NEO;	
 	 	
•	to link incentive compensation levels with the creation of stockholder value;	
 	 	
•	to align the interests of our executives and stockholders by creating opportunities and incentives for executives to increase their equity ownership; and	
 	 	
•	to motivate our executives to manage our business to meet and appropriately balance our short- and long-term objectives.	

Compensation Committee Members, Independence and Responsibilities
Our executive compensation program is administered by the Compensation Committee of our board of directors. The members of the Compensation Committee currently include Frank C. McDowell (Chairman), William H. Keogler, Jr., Barbara B. Lang, and Jeffrey L. Swope, all of whom are independent directors, and all of whom meet the enhanced independence requirements applicable to Compensation Committee members under NYSE listing standards.
The Compensation Committee sets the overall compensation strategy and compensation policies for our executive officers and directors. The Compensation Committee has the authority to determine the form and amount of compensation appropriate to achieve our strategic objectives, including salary, bonus, incentive or performance-based compensation, and equity awards. The Compensation Committee reviews its compensation strategy annually to confirm that it supports our objectives and stockholders’ interests and that executive officers are being rewarded in a manner that is consistent with our strategy.
With respect to the compensation of our Chief Executive Officer, the Compensation Committee is responsible for:
 	 	
•	reviewing and approving our corporate goals and objectives with respect to the compensation of the Chief Executive Officer;	

20

 	 	
•	evaluating the Chief Executive Officer’s performance in light of those goals and objectives; and	
 	 	
•	determining the Chief Executive Officer’s compensation (including annual base salary level, annual cash bonus, long-term incentive compensation awards, perquisites and any special or supplemental benefits) based on such evaluation.	
With respect to the compensation of NEOs other than the Chief Executive Officer, the Compensation Committee is responsible for:
 	 	
•	reviewing and approving the compensation; and	
 	 	
•	reviewing and approving grants and awards under all incentive-based compensation plans and equity-based plans.	
Role of the Compensation Consultant
To assist in carrying out its responsibilities, the Compensation Committee utilized the services of FTI Consulting, Inc. ("FTI"), a nationally recognized compensation consulting firm, to assist it in establishing our 2014 compensation plans and analyzing competitive executive compensation levels for 2014. FTI was not engaged by management to perform any work on behalf of management during 2014 and the Compensation Committee considered FTI to be independent with regard to services performed on its behalf during 2014.
During 2014, FTI provided advice and recommendations regarding our short and long term incentive compensation plans for our employees, including our NEOs. In addition, FTI provided our Compensation Committee input on our director compensation program, competitive market compensation data and recommendations for target pay levels for each component of our 2014 executive compensation program.

The FTI compensation consultant periodically attends Compensation Committee meetings as requested by the Compensation Committee and consults with our Compensation Committee Chairman, our Director of Human Resources, our Chief Executive Officer, and our Chief Financial Officer as directed by the Compensation Committee on compensation related issues.

Compensation Consultant Independence Assessment

During 2014, the Company requested and received information from FTI addressing its independence and potential conflicts of interest, including the following factors: (1) other services provided to us by the consultant; (2) fees paid by us as a percentage of the consulting firm's total revenue; (3) policies or procedures maintained by the consulting firm that are designed to prevent a conflict of interest; (4) any business or personal relationships between the individual consultants involved in the engagement and a member of the Compensation Committee; (5) any company stock owned by the individual consultants involved in the engagement; and (6) any business or personal relationships between our executive officers and the consulting firm or the individual consultants involved in the engagement. Based on an assessment of these factors, including information gathered from directors and executive officers addressing business or personal relationships with the consulting firm or the individual consultants, the Compensation Committee concluded that FTI is independent and that the work of FTI did not raise any conflict of interest.

Role of Executive Officers in Compensation Decisions

Our Chief Executive Officer reviewed the performance of each of the other NEOs and considered the recommendations of the FTI consultant with regard to each of the other NEOs. Based on this review and input, he made compensation recommendations to the Compensation Committee for all of the NEOs other than himself, including recommendations for performance targets, base salary adjustments, the discretionary components of our short-term cash incentive compensation, and long-term equity-based incentive awards. The Compensation Committee considers these recommendations along with data and input provided by FTI. The Compensation Committee retains full discretion to set all compensation for the executive officers.
Market Reference Data
During 2014 FTI provided our Compensation Committee with a competitive market analysis of our NEOs' pay level relative to the practices of a peer group of 16 public REITs. The peer group includes companies that either (a) primarily invest in office properties; or (b) are diversified REITs whose portfolio includes significant office assets. In addition, companies that were recommended were generally no less than half the size and no more than twice as large as Piedmont and are within guidelines used by Institutional Shareholder Services. The following table provides the names and estimated financial

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information for each 2014 peer company at the time the Compensation Committee reviewed the market data in October of 2014:

 	
 	 	 	 	 	 	 	 	 	 	 	
($ in millions)	 	 	 	 	 	 	 	Sector	
Company	 	Implied Equity Market Capitalization
($)	 	Total Enterprise Value
($)	 	Total Assets
($)	 	Total Revenue
($)	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Brandywine Realty Trust	 	2,580.5	 	4,658.2	 	4,704.2	 	562.2	 	Office	
Chambers Street Properties (1)	 	1,848.2	 	3,147.2	 	2,928.7	 	250.0	 	Diversified	
Columbia Property Trust, Inc. (1)	 	3,118.0	 	4,630.1	 	4,681.4	 	526.6	 	Office	
Corporate Office Properties Trust	 	2,408.5	 	4,323.0	 	3,709.5	 	523.4	 	Office	
Cousins Properties Incorporated	 	2,675.7	 	2,679.0	 	2,279.5	 	210.7	 	Diversified	
Douglas Emmett, Inc.	 	4,755.7	 	7,271.7	 	5,776.0	 	591.5	 	Office	
Duke Realty Corporation	 	6,282.0	 	9,664.9	 	7,862.5	 	1,081.8	 	Industrial/Office	
Empire State Realty Trust, Inc.(1)	 	4,081.9	 	4,889.6	 	2,476.6	 	127.6	 	Office	
Highwoods Properties, Inc.	 	3,810.3	 	5,355.5	 	3,876.8	 	556.8	 	Office	
Hudson Pacific Properties, Inc.(1)	 	1,821.9	 	2,405.8	 	2,235.0	 	205.6	 	Office	
Kilroy Realty Corporation	 	5,417.5	 	6,579.9	 	5,273.8	 	465.1	 	Office	
Liberty Property Trust	 	5,194.2	 	8,187.0	 	6,660.8	 	645.9	 	Industrial/Office	
Mack-Cali Realty Corporation	 	1,979.9	 	4,346.8	 	4,354.8	 	667.0	 	Office	
Parkway Properties, Inc.	 	2,296.4	 	3,350.2	 	3,131.5	 	291.6	 	Office	
PS Business Parks, Inc.(1)	 	2,775.1	 	3,823.7	 	2,231.5	 	359.9	 	Industrial/Office	
Washington Real Estate Investment Trust (1)	 	1,797.0	 	2,569.7	 	2,060.1	 	263.0	 	Diversified	
 	 	 	 	 	 	 	 	 	 	 	
Median	 	2,725.4	 	4,488.4	 	3,793.2	 	494.2	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Piedmont Office Realty Trust, Inc.	 	2,899.8	 	4,598.1	 	4,661.8	 	554.5	 	Office	
Percentile Rank	 	56th	 	53rd	 	66th	 	66th	 	 	
________________________

(1)    Added to the peer group for 2014.

Ten of the above companies are consistent with the peer group used in 2013; however, based upon recommendations from FTI, the Compensation Committee removed Boston Properties and SL Green Realty Corp as they were outliers in terms of size relative to our Company and added the six new companies indicated above to the peer set for 2014. In general, Piedmont ranks at the approximate 50th percentile in terms of implied equity market capitalization and total enterprise value as compared to the peer group. We use this same peer group to calculate performance under the TSR Relative to Peer Group component of our long term incentive compensation awards.
We apply our compensation policies to all of our NEOs on the same basis, with differences in compensation opportunities between each of our executive officers reflecting each of the officers’ roles, responsibilities and personal performance within our Company, as well as market pay practices. In October of 2014, FTI provided our Compensation Committee with an analysis of each of our NEO's 2014 target pay opportunity and 2013 reported pay relative to the compensation paid to executives employed by the peer group above in comparable positions to each of our NEOs. The analysis utilized the most recently filed proxy for each company in the peer group and FTI's proprietary compensation database. Additionally, for each of our EVPs, other than our Chief Financial Officer, supplemental peer group data for applicable benchmark peers based on FTI's proprietary compensation database was utilized in the analysis. The peer group analysis contained compensation data for the following compensation elements: (i) base salary, (ii) annual cash bonus; and (iii) long-term equity compensation.

The Compensation Committee noted that executives within the peer group in some cases received significant value in “other” compensation, including perquisites, supplemental retirement benefits, and other special one-time payments. This other compensation was excluded from the analysis as it has not been the Company’s historical practice to pay such items. When other compensation is factored in, the competitiveness of Piedmont's pay program declines relative to the 16 peer companies

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presented above.

Other Compensation Committee Considerations

In addition to considering market reference data set forth above in making decisions about our NEOs’ compensation opportunities and actual compensation to be paid, the Compensation Committee considers other factors such as each executive officer’s experience, scope of responsibilities, performance and prospects; internal equity in relation to other executive officers with similar levels of experience, scope of responsibilities, performance and prospects; and individual performance of each NEO during their tenure with Piedmont.
Employment Agreements with our Named Executive Officers
We are currently party to employment agreements with each of our NEOs, other than Mr. Wiberg. These agreements were originally put in place in 2007 and renew annually unless either party gives 90 days written notice prior to the end of the renewal term or his employment otherwise terminates in accordance with the terms of the agreement. Significant terms include executive clawback provisions for our CEO and CFO and severance in the event of certain circumstances as further described below:
Executive Clawback Provisions. If we are required to prepare an accounting restatement due to our material noncompliance, as a result of misconduct, with any financial reporting requirement under the securities laws, Messrs. Miller and Bowers’ agreements contain provisions that provide for the executives to reimburse us, to the extent required by Section 304 of the Sarbanes-Oxley Act of 2002, for any incentive-based (whether cash or equity-based) compensation received by the executives from us during the 12-month period following the first public issuance or filing with the SEC (whichever occurs first) of the financial document embodying such financial reporting requirement. In addition, each executive will reimburse us for any profits realized from the sale of our securities during that 12-month period.

Severance. Each of our NEOs other than Mr. Wiberg is entitled to receive severance payments under certain circumstances in the event that their employment is terminated. These circumstances and payments are described below under “Potential Payments Upon Termination or Change of Control.” Our Compensation Committee believes that these severance payments were an important factor in attracting the NEOs to join us when our Company internalized in 2007 and are an important factor in retaining our NEOs. The agreements with our NEOs do not provide for tax “gross ups” in the event such payments are made.
Elements of 2014 Executive Compensation
Base salaries and target short-term cash incentive compensation (expressed as a percentage of their base salary) for the NEOs for 2014 were as follows:

 	 	 	 	 	 	 	 	 	 	
 	 	2014 Annual
Base Salary	 	Annual Short-Term Cash
Incentive Compensation as a %
of Base Salary	 	
Name and Position	 	 	 	Threshold	 	Target	 	Maximum	 	 	
Donald A. Miller, CFA	 	$720,000	 	75%	 	120%	 	200%	 	 	
Chief Executive Officer	 	 	 	 	 	 	 	 	 	 	
Robert E. Bowers	 	$450,000	 	50%	 	100%	 	125%	 	 	
Chief Financial Officer	 	 	 	 	 	 	 	 	 	 	
Raymond L. Owens	 	$260,000	 	35%	 	70%	 	105%	 	 	
EVP—Capital Markets	 	 	 	 	 	 	 	 	 	 	
Carroll A. Reddic, IV	 	$260,000	 	35%	 	70%	 	105%	 	 	
EVP—Real Estate Operations	 	 	 	 	 	 	 	 	 	 	
Robert K. Wiberg	 	$310,000	 	50%	 	75%	 	100%	 	 	
EVP—Mid-Atlantic Region	 	 	 	 	 	 	 	 	 	 	
________________________

Base Salary. Our Compensation Committee believes that payment of a competitive base salary is a necessary element of any compensation program that is designed to attract and retain talented and qualified executives. The goal of our base salary program is to provide salaries at a level that allows us to attract and retain qualified executives while preserving significant flexibility to recognize and reward individual performance with other elements of the overall compensation program. Base

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salary levels also affect the short-term cash incentive compensation because each NEO's target opportunity is expressed as a percentage of base salary. The following items are generally considered by the Compensation Committee when determining base salary annual increases, however no particular weight is assigned to an individual item:
 	 	
•	market data provided by the compensation consultant;	
 	 	
•	comparability to compensation practices of other office REITs of similar size;	
 	 	
•	our financial resources;	
 	 	
•	the executive officer’s experience, scope of responsibilities, performance and prospects;	
 	 	
•	internal equity in relation to other executive officers with similar levels of experience, scope of responsibilities, performance, and prospects; and	
 	 	
•	individual performance of each NEO during the preceding calendar year.	
For 2014, FTI noted in their market analysis described above that our CEO and CFO were being paid well below the market median and, in all cases when compared to our peer group of companies, the total target compensation values for each of our NEOs for 2014 was below the median of our peer group. Based on their consideration of this market data and our compensation consultant's recommendations, as well as consideration of each NEO's individual performance, prospects, and relative pay, our Compensation Committee approved an approximate 5% and 4% increase to our CEO and CFO's salaries, respectively, and increases in the 3-4% range for our EVPs for 2014. Additionally, FTI recommended, and the Compensation Committee approved, increases in our CEO and CFO's STIC targets for 2014. Mr. Miller's target was increased from 100% of his base salary to 120%, and Mr. Bowers' target was increased from 80% of his base salary to 100%.
Short-Term Cash Incentive Compensation Plan. We provide an annual STIC Plan which sets forth target cash incentive payments for each of our NEOs as a percentage of base salary. The actual amounts earned under the STIC Plan may be greater or less than the NEO's respective target based on actual performance against the performance goals established by the Compensation Committee at the beginning of each year, as well as assessment of each NEOs personal contributions and performance for the year. All of the performance measures established by the Compensation Committee for 2014 were based on specific corporate metrics measured on a quantitative basis, with the exception of the Board Discretion/ Individual Performance measure which the Compensation Committee considered on a qualitative basis. Those qualitative considerations included, but were not limited to, the CEO's assessment of each NEO's performance other than his own. The performance goals that the Compensation Committee established for each of the quantitative metrics were set in line with the annual business plan for the year and were considered achievable, but not without above average performance. The following table sets forth the target performance goals, actual performance, and relative weighting of each of the performance measures established by the Compensation Committee for the 2014 STIC Plan:

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 	 	Target Performance Goal	 	Actual Performance	 	Over(Under) Performance	 	Relative Weighting	 	
Performance Measure	

Core FFO per share to Budget	
 	$1.40	
 	$1.49	 	6.4%	 	20.00	%	 	
 	 	 	 	 	 	 	 	 	 	
Balance Sheet Management:	

 	

 	 	
Refinance $575 of secured debt (in millions)	 	$650 unsecured	 	$700 unsecured	 	7.7%	 	2.50	%	 	
Achieve credit spread: (in basis points)	 	 	 	 	 	 	 	 	 	
Term Loan	 	120	 	120	 	Achieved	 	1.25	%	 	
Bond Offering	 	200	 	178	 	11.0%	 	1.25	%	 	
Maximum Percentage of Debt to Gross Asset Value	 	less than or equal to 40%	 	38.1%	 	4.8%	 	2.50	%	 	
Ladder maturities (excludes line of credit)	 	less than or equal to 25% per annum	 	less than or equal to 25% per annum	 	Achieved	 	2.50	%	 	
 	 	 	 	 	 	 	 	 	 	
Weighted Average Committed Capital Per Square Foot Leased Relative to Budget	
 	$6.75	
 	$4.83	 	28.5%	 	10.00	%	 	
 	 	 	 	 	 	 	 	 	 	
Leasing Targets (in 000s of square feet):	

 	

 	 	
New Leasing	 	1,408	 	1,202	 	(14.6)%	 	15.00	%	 	
Renewal Leasing	 	288	 	959	 	233.1%	 	10.00	%	 	
 	 	 	 	 	 	 	 	 	 	
Capital Allocations/ Markets (in millions except per share information)	 	 	 	 	 	 	 	 	 	
Acquisitions	 	$120.0	 	$151.0	 	25.8%	 	7.50	%	 	
Dispositions	 	$120.0	 	$56.6	 	(52.9)%	 	3.75	%	 	
Share Repurchases	 	2.9 million shares at or below $17.25 per share	 	3.2 million shares at $16.54 per share	 	Achieved	 	3.75	%	 	
 	 	 	 	 	 	 	 	 	 	
Board Discretion/ Individual Performance	 	Qualitative	 	Qualitative	 	Achieved Above Target	 	20.00	%	 	
Total	 	 	 	 	 	 	 	100.00	%	 	
________________________

Core FFO performance relative to Budget is considered important because our ability to meet consensus estimates of Core FFO is a factor when equity analysts value, or when present or potential stockholders make investment decisions about, our company’s securities. See the definition of Core FFO and the reconciliation of Net income attributable to Piedmont to Core FFO on pages 35 and 36 of our Annual Report on Form 10-K for the year ended December 31, 2014.
Balance Sheet Management is important because maintaining the appropriate capital structure, including the magnitude of total debt, mix of unsecured vs secured debt, debt to gross assets ratio, and laddering of maturities is critical to the overall financial strength of the Company. Additionally, as a Real Estate Investment Trust ("REIT"), we are required to pay out 90% of our taxable income each year in the form of dividends to our stockholders. Therefore, we must constantly seek new sources of capital for our Company which requires careful management of the magnitude, timing, and cost of our borrowings.
Weighted Average Committed Capital Per Square Foot measures the future capital outlays that our management team has committed to in order to execute leases during the current year. This metric serves as a cross-check to ensure that management does not trade long-term capital expenditures to procure short-term growth in Core FFO. The target performance level for this metric is based on goals for commitments that are market specific and the weighted average performance goal is a function of the level of actual leasing activity in our respective markets.
Leasing Targets are important as keeping our portfolio as fully leased as possible directly impacts our cash flow, financial results, and value of our equity securities.

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Capital Allocations/Markets refers to how we allocate our capital resources, whether it be to acquire new properties or to repurchase shares of our common stock, and is important because it impacts the overall composition and quality of our portfolio of assets. The quality of our portfolio and our management team's ability to allocate capital resources effectively are two factors that equity analysts and present or potential stockholders consider when they assess our overall enterprise value.
The Board Discretion component is considered important as it allows the Compensation Committee to appropriately reward aspects of the management team’s or individual’s performance that may not be captured through the use of the quantitative metrics. For 2014, our Compensation Committee and the board of directors unanimously approved achievement of this component above target. The Compensation Committee and the board of directors relied heavily on the extensive set of strategic and operating goals/metrics that were approved at the beginning of the year. The Compensation Committee and the board of directors recognized that the management team had met or exceeded every metric with the exception of dispositions and new leasing and viewed those items as relatively minor due more to timing than substantive. In particular, the Compensation Committee and board of directors recognized the significance of a "watershed" year in terms of positive net absorption in the portfolio for the first time in several years. The increase in lease expirations had been well known, but management produced the results/reversal that had been forecast and was expected by stockholders. In addition, the Compensation Committee and board of directors recognized that the Company's TSR for the year ended December 31, 2014 was approximately 20%, well within the relative returns of our peer group. The fact that the Company's management team was confident enough in the future direction of operating cash flow to propose that the Board approve an increase in the dividend for the first time in several years was also indicative of the significant improvement of the Company's future operating metrics. The Compensation Committee and board of directors felt it appropriate to reward management for an overall excellent year of operations.
Actual awards are calculated based on performance against the above metrics according to the following scale:

 	 	Incentive Available to be Earned Based on Actual Performance (as a Percentage of Target)	 	Relative Weighting	
Measure	Adjustment Factor	Threshold	 	Maximum (1)	 	 	
Core FFO per share to Budget	Every 1% variance in performance increases or decreases the targeted award by 5%, based on relative weighting	50%	 	150%	 	20%	
Balance Sheet Management	Every 1% variance in performance increases or decreases the targeted award by 2%, based on relative weighting	50%	 	150%	 	10%	
Weighted Average Committed Capital Per Square Foot Leased Relative to Budget	Every 1% variance in performance increases or decreases the targeted award by 5%, based on relative weighting	50%	 	150%	 	10%	
Leasing Targets	Every 1% variance in performance increases or decreases the targeted award by 2%, based on relative weighting	50%	 	150%	 	25%	
Capital Allocations/ Markets	Every 1% variance in performance increases or decreases the targeted award by 2%, based on relative weighting	50%	 	150%	 	15%	
Board Discretion/ Individual Performance	Qualitative	 	 	 	 	20%	
________________________
 	 	
(1)	200% in the case of the CEO.	
In February 2015, after (i) reviewing the results of the quantitative performance measures as set forth in the table above; (ii) considering the CEO's assessment of each of the other NEO’s performance; and (iii) assessing the CEO's performance, the Compensation Committee determined actual awards for the 2014 performance period for each individual NEO as follows:

26

 	
 	 	 	 	 	 	
Name	2014 Target  Annual
Incentive for NEOs
($)	 	2014 Actual
Annual
Incentive for NEOs
($)	
Mr. Miller	864,000	
 	 	1,149,639	
 	
Mr. Bowers	450,000	
 	 	553,208	
 	
Mr. Owens	182,000	
 	 	220,000	
 	
Mr. Reddic	182,000	
 	 	223,742	
 	
Mr. Wiberg	232,500	
 	 	264,000	
 	
 Total	1,910,500	
 	 	2,410,589	
 	
________________________

Long-Term Incentive Compensation Plan. The objective of our Long-Term Incentive Compensation Plan (“LTIC Plan”) is to attract and retain qualified personnel by offering an equity-based program that is competitive with our peer companies and that is designed to encourage each of our NEOs, as well as our broader employee base, to balance long-term company performance with short-term company goals and to foster employee retention.
LTIC awards have typically been granted in the form of deferred stock pursuant to the 2007 Omnibus Incentive Plan approved by our stockholders. The Compensation Committee has determined that, as a REIT, the grant of deferred stock awards is appropriate because our high dividend distribution requirements lead to a significant portion of our total stockholder return being delivered through our dividends. In the future, we anticipate that any additional awards granted will continue to be in the form of deferred stock, although we may consider other equity and cash-based programs to the extent they more effectively meet our program objectives and provide more favorable tax treatment to us or the individual employee. We feel that appropriately designed equity awards, particularly those with future vesting provisions, promote a performance-focused culture and align our employees’ interests with those of our stockholders, thereby motivating their efforts on our behalf and strengthening their desire to remain with us for an extended period of time.
Each NEO's annual LTIC target opportunity is divided equally between the two components of our LTIC Plan: a multi-year Performance Share Program and an Annual Deferred Stock Grant as further described below.
Performance Share Program. Half of our NEOs’ LTIC opportunity relates to a multi-year performance share compensation program (the “Performance Share Program”). The purpose of the Performance Share Program is to motivate and reward long term performance. Participants are provided with the opportunity to earn shares of Piedmont stock based on our TSR performance relative to the peer group over a three-year performance period. Participants have a defined target award expressed as a number of shares. The target number of shares established for each participant may be earned if Piedmont’s TSR is at the median of the peer group, up to 200% of target may be earned if Piedmont’s TSR is at or above the 75 th  percentile of the peer group, and up to 50% of target may be earned if Piedmont’s TSR at the 25 th percentile of the peer group. No shares are earned if Piedmont’s TSR is below the 25 th  percentile. If our return is between the 25 th  and 75 th  percentile, the payout will adjust on a straight-line basis. Performance cycles overlap, with a new three-year performance cycle beginning each year. At the end of each three-year performance priod, awards, if earned, vest immediately upon issuance. A grant date for this portion of the award is established when the Compensation Committee and the board of directors approve the multi-year plan. In accordance with SEC rules, the grant date fair value of the portion of the award related to the TSR three-year performance period assuming target performance is included in the Summary Compensation Table in the calendar year in which the grant date is established. For the range of shares that could be earned by each NEO for the 2014-16 performance period, see the Grants of Plan Based Awards for 2014 Table. There was no payout associated with the 2012-14 Performance Share Program as our TSR was below the 25th percentile threshold required for payout.
Annual Deferred Stock Grant. The other half of our NEOs' LTIC opportunity is comprised of an annual deferred stock grant opportunity, as determined by the Compensation Committee, that considers four performance measures. The performance targets that the Compensation Committee established for the quantitative metrics for 2013 were considered achievable, but not without above average performance. While such measures establish a framework for the Compensation Committee to evaluate performance, the pool of shares available to be granted is ultimately established by the Compensation Committee in its sole discretion irrespective of actual performance. As such, a grant date for accounting purposes is not established until the Compensation Committee has reviewed the Company's actual performance against the metrics and exercised its discretion to determine the pool of shares to be awarded. This process normally occurs during the calendar year following the performance period after year-end audit results and peer data are available. In accordance with SEC rules, therefore, the deferred stock granted pursuant to this component of our LTIC plan is included in the Summary Compensation Table in the calendar year of the grant, which is subsequent to the performance period.

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The following table sets forth the target goals for each of the quantitative measures and weights assigned to each measure as well as the actual results for each performance measure for the deferred stock grant that was awarded in 2014 based on 2013 performance (dollars in millions except for per share amounts):

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Goal	 	 	 	 	
Measure	Threshold	 	Target	 	Maximum	 	Actual	 	Weight	
Actual Adjusted Net Income Relative to Budget (per share)	
 	$1.22	
 	 	
 	$1.35	
 	 	
 	$1.49	
 	 	$	1.46	
 	 	20	%	
Actual Adjusted Funds From Operations Before Capital Expenditures Relative to Budget  (in millions)	
 	$188.5	
 	 	
 	$209.4	
 	 	
 	$230.3	
 	 	$	220.0	
 	 	20	%	
Actual General and Administrative Expense    Relative to Budget  (in millions)	
 	$27.5	
 	 	
 	$25.0	
 	 	
 	$22.5	
 	 	$	21.9	
 	 	10	%	
Total Shareholder Return Relative to Peers (in millions)	25th Percentile	
 	 	50th Percentile	
 	 	75th Percentile	
 	 	Threshold Not Met	
 	 	25	%	
Board Discretion/Individual Performance	Qualitative	
 	 	Qualitative	
 	 	Qualitative	
 	 	Achieved at Target	
 	 	25	%	
________________________ 
Adjusted Net Income is an internally defined performance metric derived from Piedmont’s annual budget which mirrors the calculation of the widely recognized Funds From Operations (“FFO”) metric that is used in the real estate industry with the exception that certain non-recurring items such as lease termination income and expense are matched to occur in the same period regardless of when such items would be recognized in an FFO calculation and certain significant nonrecurring items may be removed at the discretion of the Compensation Committee.
Actual Adjusted Funds from Operations Before Capital Expenditures vs Budget is important because it more closely mirrors the actual cash flow generated by the company in that it removes certain non-cash revenue and expense items such as the effect of straight-line rents which are not adjusted when computing FFO in accordance with the definition established by the National Association of Real Estate Investment Trusts ("NAREIT").
Actual General and Administrative Expense Relative to Budget is considered important because it measures how efficiently we manage our controllable overhead expenses such as labor, professional services, and stockholder communication expenses, among others.
TSR Relative to Peers compares our annual TSR (calculated as the difference between beginning and ending stock price for the period and giving effect to dividends paid during the period, expressed as a percentage of beginning stock price) to the TSR of the peer group (see “Market Reference Data” for a complete description of the peer group). The beginning and ending stock prices for the period were based on the average closing price for the twenty trading days straddling December 31st. The target performance level for this metric is the 50 th  percentile of the peer group.
The actual number of shares that each individual NEO was eligible to earn was determined by the Compensation Committee after considering the calculated number of shares that each NEO had earned based on actual performance against the performance measures outlined above. The calculated number of shares for each NEO was determined by increasing or decreasing each NEO's targeted number of shares by 5% for each 1% variation in performance relative to performance measures within an established threshold and maximum of 50% and 150% of target, respectively. In the case of the CEO, the maximum incentive is capped at 200% of target. Each individual NEO's targeted number of shares was established by the Compensation Committee based on recommendations from our compensation consultant regarding comparability with awards to officers of our peer group of office REITs as well as taking into consideration each officer’s salary and experience level.
The Board Discretion component allows the Compensation Committee to appropriately recognize aspects of the management team’s or individual’s performance that may not be captured through the use of the quantitative metrics. For the 2013 deferred stock grant opportunity, the Compensation Committee determined to award the targeted amount associated with the board discretion component based on the outperformance for three of the four quantitative performance measures. The Compensation Committee viewed management's performance as having been good in a challenging environment for the Company's specific markets and portfolio.
On May 9, 2014 the Compensation Committee granted equity awards pursuant to our LTIC Plan for the 2013 service period in the form of deferred stock in accordance with the terms of the 2007 Omnibus Incentive Plan described above. See “Grants of Plan Based Awards for 2014” table below for information on the number of shares of deferred stock granted to each of the NEOs during 2014. For the awards granted, 25% vested immediately, while the remaining 75% vests in 25% increments

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over the next three years on the grant anniversary date. Any accrued dividends are paid out upon vesting of the underlying shares.
Special One-Time Retention Award. In January of 2014, as part of a company wide review of executives to make sure that incentives were in place to reward and retain key personnel, the Compensation Committee and board of directors approved a special, one-time, retention award to Mr. Wiberg in the form of 12,518 shares of restricted stock which vest annually, in 20% increments, beginning on the first anniversary of the grant date. The board of directors viewed Mr. Wiberg as being a key executive in one of our most important markets that was facing major local market challenges.  The fact that Mr. Wiberg is the only NEO that does not have an employment agreement and that he did not have a significant amount of unvested shares were factors that the Compensation Committee and board of directors considered in determining to make the award to Mr. Wiberg. The Compensation Committee and board of directors wanted to make sure that Mr. Wiberg was motivated to stay with Piedmont and face the challenges in his particular region.  
Benefits. All of our NEOs participate in the health and welfare benefit programs, including medical, dental and vision care coverage, disability, long-term care and life insurance, and our 401(k) plan that are generally available to the rest of our employees. We do not have any special benefits or retirement plans for our NEOs other than the ability to defer certain amounts of their compensation and an annual physical for our Chief Executive Officer.
Stock Ownership Guidelines

Our board of directors has established stock ownership guidelines whereby our NEOs are required to own stock equal to the lesser of shares with a value equal to a specified multiple of their base salary or a specific number of shares as follows:

 	 	 	 	
 	Lesser Of:	
 	Multiple of
Salary	 	Shares of
Stock	
Chief Executive Officer	5x	 	195,000	
Chief Financial Officer	3x	 	75,000	
EVP—Capital Markets	2x	 	30,000	
EVP—Real Estate Operations	2x	 	30,000	
EVP—Mid-Atlantic Region and Head of Development	2x	 	30,000	
________________________

As of December 31, 2014, each of our NEOs, other than Mr. Wiberg, has achieved his ownership requirement. As Mr. Wiberg began employment with us in 2012, he has until year end 2017 to achieve his ownership requirement. Additionally, he is required to hold 60% of the shares he is granted by us as compensation, net of taxes, until his ownership requirement is met.

In addition, each member of our board of directors is required to own the lesser of 10,000 shares or $200,000. All of our directors currently meet this requirement, with the exception of Mr. Milnes and Ms. Lang, who joined our board of directors in 2011 and 2015, respectively, and who will have until year end 2015 and 2019, respectively, to meet the requirement.

Hedging, Pledging and Insider Trading Policy.

Our insider trading policy prohibits our employees, officers and directors from hedging their ownership of our stock, including a prohibition on short sales and buying or selling of puts and calls. Our insider trading policy also prohibits our employees, officers and directors from purchasing or selling our securities while in possession of material non-public information. Our insider trading policy also prohibits our executive officers and directors from pledging our securities or otherwise using our securities as collateral. None of our executive officers or directors holds any of our stock subject to pledge.

The Impact of Regulatory Requirements on Compensation
Section 162(m) of the Code limits to $1.0 million a publicly held company’s tax deduction each year for compensation to any “covered employee,” except for certain qualifying “performance-based compensation.” As long as we qualify as a REIT, however, we do not pay taxes at the corporate level. Therefore, we believe any potential future loss of deductibility of compensation which may occur would not have a significant adverse impact on us.
To the extent that any part of our compensation expense does not qualify for deduction under Section 162(m), a larger portion of stockholder distributions may be subject to federal income tax as ordinary income rather than return of capital, and

29

any such compensation allocated to our taxable REIT subsidiary whose income is subject to federal income tax would result in an increase in income taxes due to the inability to deduct such compensation.
Although we and the Compensation Committee will be mindful of the limits imposed by Section 162(m), even if it is determined that Section 162(m) applies or may apply to certain compensation packages, we nevertheless reserve the right to structure compensation packages and awards in a manner that may exceed the limitation on deduction imposed by Section 162(m).

2014 Executive Compensation Tables
The following table sets forth information concerning the compensation for the three years ended December 31, 2014 by our NEOs, reported in accordance with SEC rules.

SUMMARY COMPENSATION TABLE FOR 2014

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Name and Principal Position	 	Year	 	Salary
($)	 	Bonus
($)	 	Stock
Awards
($)(1)	  	Non-Equity
Incentive Plan
Compensation
($)	 	All Other
Compensation
($)	  	Total
($)	 	
Donald A. Miller, CFA	 	2014	 	720,000	
 	 	 	 	2,045,933	
 	(3) 	1,149,639	
 	 	25,303	
 	(7) 	3,940,875	
 	 	
Chief Executive Officer and President	 	2013	 	685,000	
 	 	 	 	1,672,962	
 	(4) 	787,374	
 	 	25,318	
 	 	3,170,654	
 	 	
 	 	2012	 	674,000	
 	 	 	 	1,901,474	
 	(5) 	460,048	
 	 	24,396	
 	 	3,059,918	

Robert E. Bowers	 	2014	 	450,000	
 	 	 	 	800,881	
 	(3) 	553,208	
 	 	23,282	
 	(7) 	1,827,371	
 	 	 	 	
Executive Vice President and Chief Financial Officer	 	2013	 	433,000	
 	 	 	 	669,157	
 	(4) 	372,190	
 	 	23,192	
 	 	1,497,539	
 	 	 	 	
 	 	2012	 	425,000	
 	 	 	 	760,586	
 	(5) 	232,072	
 	 	22,716	
 	 	1,440,374	

Raymond L. Owens	 	2014	 	260,000	
 	 	 	 	282,629	
 	(3) 	220,000	
 	 	23,282	
 	 	785,911	
 	 	 	 	 	 	
Executive Vice President—Capital Markets	 	2013	 	250,000	
 	 	 	 	239,011	
 	(4) 	188,029	
 	 	20,192	
 	 	697,232	
 	 	 	 	 	 	
 	 	2012	 	245,000	
 	 	 	 	271,644	
 	(5) 	117,060	
 	 	22,716	
 	 	656,420	

Carroll A. Reddic, IV	 	2014	 	260,000	
 	 	 	 	282,629	
 	(3) 	223,742	
 	 	17,782	
 	(7) 	784,153	
 	 	 	 	 	 	 	 	
Executive Vice President—Real Estate Operations	 	2013	 	252,500	
 	 	 	 	239,011	
 	(4) 	189,909	
 	 	17,692	
 	 	699,112	
 	 	 	 	 	 	 	 	
 	 	2012	 	247,500	
 	 	 	 	271,644	
 	(5) 	118,254	
 	 	17,216	
 	 	654,614	

Robert K. Wiberg(2)	 	2014	 	310,000	
 	 	 	 	612,055	
 	(3)(9) 	264,000	
 	 	6,032	
 	(7) 	1,192,087	
 	 	 	 	 	 	 	 	 	 	
Executive Vice President— Mid-Atlantic Region and Head of Development	 	2013	 	300,000	
 	 	 	 	324,250	
 	(4) 	225,635	
 	 	5,942	
 	 	855,827	
 	 	 	 	 	 	 	 	 	 	
 	 	2012	 	43,845	
 	 	112,500	
 	(8) 	360,000	
 	(6) 	—	
 	 	—	
 	 	516,345	
 	 	 	 	 	 	 	 	 	 	
________________________ 
 	 	
(1) 	In accordance with SEC rules, the stock award column includes the annual deferred stock grant and the aggregate grant date fair value of the Performance Share Component of our LTIC program at target levels, even though there is no guarantee that any amounts will ultimately be earned by and paid to the executive. See "2014 Realized Pay Table" and "Stock Vested for 2014" table below for the value of actual stock awards which vested during the year ended December 31, 2014.	
 	 	
(2) 	Mr. Wiberg became employed by us November 7, 2012.	
 	 	
(3) 	Represents the aggregate grant date fair value of potential awards under the 2014-16 Performance Share Program at target levels and the deferred stock awards granted in 2014 for 2013 performance, both under our LTIC program. Values are estimated as the total expense associated with each grant to be recognized for financial statement reporting purposes over the respective service period associated with each grant calculated in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification (“ASC”) Topic 718, Share-Based Payments. Pursuant to SEC rules the values are not reduced by an estimate for the probability of forfeiture. The aggregate grant date fair value of the 2013 annual deferred stock award granted in 2014 was based on the closing price of our common stock on the May 9, 2014 grant date of $18.51 per share. The aggregate grant date fair value of the 2014 Performance Share Program was based on an estimated fair value per share as of the grant date of $22.00 per share utilizing a Monte Carlo valuation model that models the plan’s potential payoff depending on Piedmont’s and its peer group’s future stock price movements. The potential value of the 2014-16 Performance Share Program award at the grant date assuming the highest level of performance conditions were achieved would have been (in 000’s): Miller - $2,000; Bowers - $800; Owens - $280; Reddic - $280; and Wiberg $400.	
 	 	
(4) 	Represents the aggregate grant date fair value of potential awards under the 2013-15 Performance Share Program at target levels and the deferred stock awards granted in 2013 for 2012 performance, both under our LTIC program. Values are estimated as the total expense associated with each grant to be recognized for financial statement reporting purposes over the respective service period associated with each grant calculated in accordance with FASB ASC Topic 718, Share-Based Payments. Pursuant to SEC rules the values are not reduced by an estimate for the probability	

30

of forfeiture. The aggregate grant date fair value of the 2012 annual deferred stock award granted in 2013 was based on the closing price of our common stock on the April 2, 2013 grant date of $19.47 per share. The aggregate grant date fair value of the 2013-15 Performance Share Program was based on an estimated fair value per share as of the grant date of $18.91 per share utilizing a Monte Carlo valuation model that models the plan’s potential payoff depending on Piedmont’s and its peer group’s future stock price movements. The potential value of the 2013-15 Performance Share Program award at the grant date assuming the highest level of performance conditions were achieved would have been (in 000’s): Miller - $1,750; Bowers - $700; Owens - $250; Reddic - $250; and Wiberg - $375.
 	 	
(5) 	Represents the aggregate grant date fair value of potential awards under the 2012-14 Performance Share Program at target levels and the deferred stock awards granted in 2012 for 2011 performance, both under our LTIC program. Values are estimated as the total expense associated with each grant to be recognized for financial statement reporting purposes over the respective service period associated with each grant calculated in accordance with FASB ASC Topic 718, Share-Based Payments. Pursuant to SEC rules the values are not reduced by an estimate for the probability of forfeiture. The aggregate grant date fair value of the 2011 annual deferred stock award granted in 2012 was based on the closing price of our common stock on the April 4, 2012 grant date of $17.49 per share. The aggregate grant date fair value of the 2012-14 Performance Share Program was based on an estimated fair value per share as of the grant date of $17.42 per share utilizing a Monte Carlo valuation model that models the plan’s potential payoff depending on Piedmont’s and its peer group’s future stock price movements. The potential value of the 2012-14 Performance Share Program award at the grant date assuming the highest level of performance conditions were achieved would have been (in 000’s): Miller - $1,750; Bowers - $700; Owens - $250; and Reddic - $250.	
 	 	
(6) 	Represents a signing bonus of 19,956 shares of deferred stock paid to Mr. Wiberg in conjunction with the terms of his employment by us during 2012. The aggregate grant date fair value of the deferred stock was based on the closing price of our common stock on the November 7, 2012 grant date of $18.04 per share. Of the stock granted, 25% vested immediately upon grant and the remaining 75% vests ratably on the anniversary of the grant date over the next three years.	
 	 	
(7) 	All other compensation for 2014 was comprised of the following:	

 	
 	 	 	 	 	 	 	 	 	 	 	 	 	
Name	 	Matching
Contributions
to 401(k)
($)	 	Premium
for
Company
Paid Life
Insurance
($)	 	Executive Health Physical
($)	 	Total Other
Compensation
($)	
Donald A. Miller, CFA	 	23,000	
 	 	282	
 	 	2,021	
 	 	25,303	
 	
Robert E. Bowers	 	23,000	
 	 	282	
 	 	—	
 	 	23,282	
 	
Raymond L. Owens	 	23,000	
 	 	282	
 	 	—	
 	 	23,282	
 	
Carroll A. Reddic, IV	 	17,500	
 	 	282	
 	 	—	
 	 	17,782	
 	
Robert K. Wiberg	 	5,750	
 	 	282	
 	 	—	
 	 	6,032	
 	
Other than our CEO's executive health physical, the above benefits were paid pursuant to the same benefit plans offered to all of our employees.
 	 	
(8) 	Represents a discretionary cash bonus of $112,500 paid to Mr. Wiberg in conjunction with the terms of his employment by us during 2012.	
 	 	
(9) 	Includes a one-time, discretionary retention award to Mr. Wiberg of 12,158 shares of restricted stock on January 3, 2014. The aggregate grant date fair value of the deferred stock was based on the closing price of our common stock on the January 2, 2014 grant date of $16.45 per share. Such shares vest ratably on the anniversary of the grant date over the next five years.	

2014 Realized Pay Table

As noted in the Summary Compensation Table above, SEC rules require the stock award column of the Summary Compensation Table to include the aggregate grant date fair value of the performance share component of our LTIC program at target levels, even though there is no guarantee that any amounts will ultimately be earned by and paid to the executive. In addition, SEC rules require the entire aggregate grant date fair value of the deferred stock award component of our LTIC program to be included in the year the award is granted although such awards vest over a three-year period. As a supplement to the Summary Compensation Table, the table below shows the compensation actually realized by each of our NEOs during each of the last three years ended December 31, 2014. The realized pay during the three year period is less than the value shown in the summary compensation table as the realized pay, specifically the value of vesting stock awards, is affected by our stock price performance, and as such, reflects the pay for performance orientation of our executive compensation program.
In the table below, the stock award column is calculated by multiplying the number of shares that actually vested during the respective year by our closing stock price on the vesting date, and adding the value of any dividend equivalents rights that were paid to the NEO in conjunction with the vestings of the stock:

31

REALIZED PAY TABLE FOR 2014

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
Name and Principal Position	 	Year	 	Salary
($)	 	Bonus
($)	 	Stock
Awards That Vested
($) (2)	 	Non-Equity
Incentive Plan
Compensation ($)	 	All Other
Compensation
($)	 	Total
($)	 	
Donald A. Miller, CFA	 	2014	 	720,000	
 	 	 	 	885,595	
 	 	1,149,639	
 	(3) 	25,303	
 	(5) 	2,780,537	
 	 	
Chief Executive Officer and President	 	2013	 	685,000	
 	 	 	 	1,383,687	
 	 	787,374	
 	 	25,318	
 	 	2,881,379	
 	 	
 	 	2012	 	674,000	
 	 	 	 	1,664,290	
 	 	460,048	
 	 	24,396	
 	 	2,822,734	

Robert E. Bowers	 	2014	 	450,000	
 	 	 	 	349,836	
 	 	553,208	
 	(3) 	23,282	
 	(5) 	1,376,326	
 	 	 	 	
Chief Financial Officer, Executive Vice President and Treasurer	 	2013	 	433,000	
 	 	 	 	588,307	
 	 	372,190	
 	 	23,192	
 	 	1,416,689	
 	 	 	 	
 	 	2012	 	425,000	
 	 	 	 	693,489	
 	 	232,072	
 	 	22,716	
 	 	1,373,277	

Raymond L. Owens	 	2014	 	260,000	
 	 	 	 	124,959	
 	 	220,000	
 	(3) 	23,282	
 	(5) 	628,241	
 	 	 	 	 	 	
Executive Vice President—Capital Markets	 	2013	 	250,000	
 	 	 	 	209,648	
 	 	188,029	
 	 	20,192	
 	 	667,869	
 	 	 	 	 	 	
 	 	2012	 	245,000	
 	 	 	 	247,337	
 	 	117,060	
 	 	22,716	
 	 	632,113	

Carroll A. Reddic, IV	 	2014	 	260,000	
 	 	 	 	124,959	
 	 	223,742	
 	(3) 	17,782	
 	(5) 	626,483	
 	 	 	 	 	 	 	 	
Executive Vice President—Real Estate Operations	 	2013	 	252,500	
 	 	 	 	194,150	
 	 	189,909	
 	 	17,692	
 	 	654,251	
 	 	 	 	 	 	 	 	
 	 	2012	 	247,500	
 	 	 	 	234,980	
 	 	118,254	
 	 	17,216	
 	 	617,950	

Robert K. Wiberg(1)	 	2014	 	310,000	
 	 	 	 	167,436	
 	 	264,000	
 	(3) 	6,032	
 	(5) 	747,468	
 	 	 	 	 	 	 	 	 	 	
Executive Vice President—Mid-Atlantic Region and Head of Development	 	2013	 	300,000	
 	 	 	 	136,274	
 	 	225,635	
 	 	5,942	
 	 	667,851	
 	 	 	 	 	 	 	 	 	 	
 	 	2012	 	43,845	
 	 	112,500	
 	(4) 	90,002	
 	 	—	
 	 	—	
 	 	246,347	
 	 	 	 	 	 	 	 	 	 	
________________________
 	 	
(1) 	Mr. Wiberg became employed by us on November 7, 2012.	
 	 	
(2) 	Calculated based on the number of shares vesting on each vesting date during the respective year multiplied by the closing price of our common stock on the respective vesting date and adding the value of any dividend equivalent rights paid out in conjunction with the vestings.	
 	 	
(3) 	Represents amounts earned during the year ended December 31, 2014, which were paid in February 2015.	
 	 	
(4) 	Represents a discretionary cash bonus of $112,500 paid to Mr. Wiberg in conjunction with the terms of his employment by us during 2012.	
 	 	
(5) 	See detail of all other compensation for 2014 included under Summary Compensation Table above.	

Plan-Based Awards
The table below sets forth: (1) the threshold, target, and maximum of our 2014 STIC plan and of the Performance Share Component of our 2014-16 LTIC plan, and (2) the actual shares that were granted in 2014 pursuant to the Deferred Stock Component of our 2013 LTIC Plan.

32

GRANTS OF PLAN-BASED AWARDS FOR 2014

 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
 	Grant Date	 	Estimated Potential Payouts Under
Non-Equity Incentive Plan
Awards(1)	 	Estimated Future Payouts Under
Equity Incentive Plan Awards (2)	 	All Other Stock Awards:	 	 	 	
 	 	 	Threshold	 	Target	 	Maximum	 	Threshold (Number of Shares)	 	Target (Number of Shares)	 	Maximum (Number of Shares)	 	Number of
Shares
of Stock	 	Grant Date
Fair Value of
Stock Awards	 	 	
Donald A. Miller, CFA	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 STIC Plan	 	 	$	540,000	
 	 	$	864,000	
 	 	$	1,440,000	
 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 LTIC Plan—2014-16 Performance Share Component	May 9, 2014	 	 	 	 	 	 	 	27,013	
 	 	54,025	
 	 	108,050	
 	 	 	 	$	1,188,550	
 	 	 	
2013 LTIC Plan—Deferred Stock Component	May 9, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	46,320	
 	(3) 	$	857,383	
 	 	 	
Robert E. Bowers	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 STIC Plan	 	 	$	225,000	
 	 	$	450,000	
 	 	$	562,500	
 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 LTIC Plan—2014-16 Performance Share Component	May 9, 2014	 	 	 	 	 	 	 	10,805	
 	 	21,610	
 	 	43,220	
 	 	 	 	$	475,420	
 	 	 	
2013 LTIC Plan—Deferred Stock Component	May 9, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	17,583	
 	(3) 	$	325,461	
 	 	 	
Raymond L. Owens	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 STIC Plan	 	 	$	91,000	
 	 	$	182,000	
 	 	$	273,000	
 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 LTIC Plan—2014-16 Performance Share Component	May 9, 2014	 	 	 	 	 	 	 	3,782	
 	 	7,563	
 	 	15,126	
 	 	 	 	$	166,386	
 	 	 	
2013 LTIC Plan—Deferred Stock Component	May 9, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	6,280	
 	(3) 	$	116,243	
 	 	 	
Carroll A. Reddic, IV	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 STIC Plan	 	 	$	91,000	
 	 	$	182,000	
 	 	$	273,000	
 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 LTIC Plan—2014-16 Performance Share Component	May 9, 2014	 	 	 	 	 	 	 	3,782	
 	 	7,563	
 	 	15,126	
 	 	 	 	$	166,386	
 	 	 	
2013 LTIC Plan—Deferred Stock Component	May 9, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	6,280	
 	(3) 	$	116,243	
 	 	 	
Robert K. Wiberg	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 STIC Plan	 	 	$	155,000	
 	 	$	232,500	
 	 	$	310,000	
 	 	 	 	 	 	 	 	 	 	 	 	 	
2014 LTIC Plan—2014-16 Performance Share Component	May 9, 2014	 	 	 	 	 	 	 	5,403	
 	 	10,805	
 	 	21,610	
 	 	 	 	$	237,710	
 	 	 	
2013 LTIC Plan—Deferred Stock Component	May 9, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	9,419	
 	(3) 	$	174,346	
 	 	 	
Special One-Time Retention Award	January 3, 2014	 	 	 	 	 	 	 	 	 	 	 	 	 	12,158	
 	(4) 	$	199,999	
 	 	 	
________________________
 	 	
(1) 	Represents cash payout opportunity for 2014 under the STIC Plan. The amounts actually earned for 2014 are included in the non-equity incentive plan compensation column of the Summary Compensation Table.	
 	 	
(2) 	Represents the potential number of shares associated with the payout opportunity under the 2014-16 Performance Share Component of the 2014 LTIC Plan. Any amounts earned will be granted in the form of deferred stock in 2017.	
 	 	
(3) 	Represents shares awarded in 2014 pursuant to the Deferred Stock Component of the 2013 LTIC Plan (year ended December 31, 2013 performance period).	
 	 	
(4) 	Represents shares awarded in 2014 pursuant to a special one-time retention award. Shares vest 20% per year, beginning on the first anniversary of the award date.	

33

Outstanding Equity Awards at Fiscal Year-End

The following table provides information regarding unvested time-based stock awards and equity incentive plan awards that had not been earned or vested as of December 31, 2014 held by our NEOs as of December 31, 2014. All market values were determined by multiplying the number of shares of stock that have not vested or the number of unearned unvested shares by the closing price of our common stock on December 31, 2014 and adding the value of any unvested dividend equivalent rights as of December 31, 2014. All equity incentive programs were established pursuant to the 2007 Omnibus Incentive Plan and no options to purchase shares of our common stock have ever been awarded or granted to our NEOs.

34

OUTSTANDING EQUITY AWARDS AT FISCAL YEAR END 2014

 	 	LTIC Stock Awards	 	
 	 	Deferred Stock Component	 	Performance Share Component	 	
Name	 	Number of
Shares or
Units of Stock
That Have Not
Vested
(#)	 	Market Value
of Shares or
Units of Stock
That Have Not
Vested	 	Equity Incentive Plan
Awards: Number of
Unearned Shares, Units
or Other Rights That
Have Not Vested
(#)	 	Equity Incentive Plan
Awards: Market or
Payout Value of
Unearned Shares, Units
or Other Rights That
Have Not Vested	 	
Donald A. Miller, CFA:	 	 	 	 	 	 	 	 	 	
 April 4, 2012 plan award (2)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 4, 2012 award(1)	 	14,722	
 	 	$	309,898	
 	(5) 	 	 	 	 	
 April 2, 2013 plan award (3)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 2, 2013 award(1)	 	20,492	
 	 	$	414,963	
 	(6) 	 	 	 	 	
 May 9, 2014 plan award (4)	 	 	 	
 	 	54,025	
 	 	$	1,050,786	
 	 	
 May 9, 2014 award(1)	 	34,740	
 	 	$	675,693	
 	(7) 	 	 	 	 	
Total	 	69,954	
 	 	$	1,400,554	
 	 	54,025	
 	 	$	1,050,786	
 	 	
Robert E. Bowers	 	 	 	 	 	 	 	 	 	
 April 4, 2012 plan award (2)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 4, 2012 award(1)	 	5,889	
 	 	$	123,963	
 	(5) 	 	 	 	 	
 April 2, 2013 plan award (3)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 2, 2013 award(1)	 	8,196	
 	 	$	165,969	
 	(6) 	 	 	 	 	
 May 9, 2014 plan award (4)	 	 	 	
 	 	21,610	
 	 	$	420,315	
 	 	
 May 9, 2014 award(1)	 	13,187	
 	 	$	256,487	
 	(7) 	 	 	 	 	
Total	 	27,272	
 	 	$	546,419	
 	 	21,610	
 	 	$	420,315	
 	 	
Raymond L. Owens	 	 	 	 	 	 	 	 	 	
 April 4, 2012 plan award (2)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 4, 2012 award(1)	 	2,103	
 	 	$	44,268	
 	(5) 	 	 	 	 	
 April 2, 2013 plan award (3)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 2, 2013 award(1)	 	2,928	
 	 	$	59,292	
 	(6) 	 	 	 	 	
 May 9, 2014 plan award (4)	 	 	 	
 	 	7,563	
 	 	$	147,100	
 	 	
 May 9, 2014 award(1)	 	4,710	
 	 	$	91,610	
 	(7) 	 	 	 	 	
Total	 	9,741	
 	 	$	195,170	
 	 	7,563	
 	 	$	147,100	
 	 	
Carroll A. Reddic, IV	 	 	 	 	 	 	 	 	 	
 April 4, 2012 plan award (2)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 4, 2012 award(1)	 	2,103	
 	 	$	44,268	
 	(5) 	 	 	 	 	
 April 2, 2013 plan award (3)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 2, 2013 award(1)	 	2,928	
 	 	$	59,292	
 	(6) 	 	 	 	 	
 May 9, 2014 plan award (4)	 	 	 	
 	 	7,563	
 	 	$	147,100	
 	 	
 May 9, 2014 award(1)	 	4,710	
 	 	$	91,610	
 	(7) 	 	 	 	 	
Total	 	9,741	
 	 	$	195,170	
 	 	7,563	
 	 	$	147,100	
 	 	
Robert K. Wiberg	 	 	 	 	 	 	 	 	 	
November 7, 2012 award (1)	 	4,989	
 	 	$	103,023	
 	(8) 	 	 	 	 	
 April 2, 2013 plan award (3)	 	 	 	 	 	—	
 	 	$	—	
 	 	
 April 2, 2013 award(1)	 	3,512	
 	 	$	71,118	
 	(6) 	 	 	 	 	
 January 3, 2014 award	 	9,726	
 	 	$	191,116	
 	(9) 	 	 	 	 	
 May 9, 2014 plan award (4)	 	 	 	
 	 	10,805	
 	 	$	210,157	
 	 	
 May 9, 2014 award(1)	 	7,064	
 	 	$	137,395	
 	(7) 	 	 	 	 	
 	 	25,291	
 	 	$	502,652	
 	 	10,805	
 	 	$	210,157	
 	 	
________________________
 	 	
(1) 	Awards vest 25% immediately upon grant with the remaining 75% vesting 25% per year on the anniversary of the grant date.	
 	 	
(2) 	Based on Piedmont's actual relative TSR performance for the three year period ended December 31, 2014, as of December 31, 2014, we had not achieved the threshold for performance for any shares to be paid out under the Performance Share Program component of the 2012 LTIC Plan.	
 	 	
(3) 	Based on Piedmont's actual relative TSR performance for the two year period ended December 31, 2014, we had not achieved the threshold for performance for any shares to be paid out under the Performance Share Program component of the 2013 LTIC Plan. Actual awards to be paid to	

35

NEOs will be determined during 2016 based on Piedmont's actual relative TSR performance for the three year period ended December 31, 2015 and any shares awarded will vest immediately upon issuance.
 	 	
(4) 	Estimated based on Piedmont's actual relative TSR performance for the year ended December 31, 2014, we had achieved target-level performance for the Performance Share Program component of the 2014 LTIC Plan. Actual awards to be paid to NEOs will be determined during 2017 based on Piedmont's actual relative TSR performance for the three year period ended December 31, 2016 and any shares awarded will vest immediately upon issuance.	
 	 	
(5) 	Market value of unearned shares is based on our closing stock price as of December 31, 2014 of $18.84 per share, plus $2.21 per share of dividend equivalent rights that vest upon vesting of the underlying shares.	
 	 	
(6) 	Market value of unearned shares is based on our closing stock price as of December 31, 2014 of $18.84 per share, plus $1.41 per share of dividend equivalent rights that vest upon vesting of the underlying shares.	
 	 	
(7) 	Market value of unearned shares is based on our closing stock price as of December 31, 2014 of $18.84 per share, plus $.61 per share of dividend equivalent rights that vest upon vesting of the underlying shares.	
 	 	
(8) 	Market value of unearned shares is based on our closing stock price as of December 31, 2014 of $18.84 per share, plus $1.81 per share of dividend equivalent rights that vest upon vesting of the underlying shares.	
 	 	
(9) 	Market value of unearned shares is based on our closing stock price as of December 31, 2014 of $18.84 per share, plus $.81 per share of dividend equivalent rights that vest upon vesting of the underlying shares.	

Stock Vested

The following table provides information regarding the actual number of shares vested for each of our NEOs during the year ended December 31, 2014. No options to purchase shares of our common stock have ever been awarded or granted to our NEOs.

STOCK VESTED FOR 2014

 	 	 	 	 	 	 	
 	 	Stock Awards	
Name	 	Number of
Shares Acquired
On Vesting
(#)	 	Value Realized
on Vesting
($)(1)	
Donald A. Miller, CFA	 	47,671	
 	 	885,595	
 	
Robert E. Bowers	 	18,830	
 	 	349,836	
 	
Raymond L. Owens	 	6,726	
 	 	124,959	
 	
Carroll A. Reddic, IV	 	6,726	
 	 	124,959	
 	
Robert K. Wiberg	 	9,099	
 	 	167,436	
 	
________________________
 	 	
(1) 	Value realized on vesting is calculated based on the number of shares vesting on each vesting date during 2014 multiplied by the closing price of our common stock on the respective vesting date and adding the value of any dividend equivalent rights paid out in conjunction with the vestings.	

Potential Payments upon Termination or Change of Control
The employment agreements with four of our NEOs provide for severance payments and benefits upon termination of employment in certain circumstances as set forth in the table below. Mr. Wiberg's 2012 offer letter in conjunction with his employment contained change in control severance benefits for the first two years of employment that expired in 2014. If an executive resigns without good reason (which includes retirement), or if we terminate an executive for cause, then such executive is only entitled to receive his Accrued Benefits, as defined below.

36

 	
 	 	 	 	 	 	 	 	 	
 	 	Without
Cause   or For Good
Reason	 	Termination in the Event of Change-in-Control, Without Cause, or For Good Reason	 	Non-renewal by Us of
Executive's Employment Agreement	 	Death or
Disability	
 	 	 	 	 	 	 	 	 	
Donald A. Miller, CFA:	 	 	 	

Accrued Benefits(1)	 	X	 	X	 	X	 	X	
Pro-rated annual bonus (2)	 	X	 	X	 	X	 	X	
2x Annual Salary and Average Bonus(3)	 	X	 	X	 	X	 	X	
Two years of medical benefits(4)	 	X	 	X	 	 	 	 	
One year of medical benefits(4)	 	 	 	 	 	X	 	X	
 	 	 	 	 	 	 	 	 	
Robert E. Bowers:	 	 	 	

Accrued Benefits(1)	 	X	 	X	 	X	 	X	
Pro-rated annual bonus(2)	 	X	 	X	 	X	 	X	
2x Annual Salary and Average Bonus(3)	 	X	 	X	 	X	 	X	
Two years of medical benefits(4)	 	X	 	X	 	 	 	 	
One year of medical benefits(4)	 	 	 	 	 	X	 	X	
 	 	 	 	 	 	 	 	 	
Raymond L. Owens	 	 	 	

 	
Accrued Benefits(1)	 	X	 	X	 	X	 	X	
Pro-rated annual bonus(2)	 	X	 	X	 	X	 	X	
1x Annual Salary and Average Bonus(3)	 	X	 	X	 	X	 	X	
One year of medical benefits(4)	 	X	 	X	 	X	 	X	
 	 	 	 	 	 	 	 	 	
Carroll A. Reddic, IV	 	 	 	

 	
Accrued Benefits(1)	 	X	 	X	 	X	 	X	
Pro-rated annual bonus(2)	 	X	 	X	 	X	 	X	
1x Annual Salary and Average Bonus(3)	 	X	 	X	 	X	 	X	
One year of medical benefits(4)	 	X	 	X	 	X	 	X	
________________________
 	 	
(1) 	"Accrued Benefits" include any unpaid annual salary that has accrued, payment for unused vacation, any earned but unpaid annual bonus for the previous year, unreimbursed expenses, and any rights granted the executive pursuant to our 2007 Omnibus Incentive Plan, including the executive's pro-rata share of any unvested Performance Share Program awards earned considering the number of service months worked as compared to the total service months of the plan.	
 	 	
(2) 	For the then-current year.	
 	 	
(3) 	Average bonus is based upon bonuses paid for the three years prior to the year of termination.	
 	 	
(4) 	For the executive and the executive’s spouse and eligible dependents.	

The amounts described above do not include payments and benefits to the extent they have been earned prior to the termination of employment or are provided on a non-discriminatory basis to salaried employees upon termination of employment. These include:
 	 	
•	distribution of balances under our 401(k) plan;	
 	 	
•	life insurance proceeds in the event of death; and	
 	 	
•	disability insurance payouts in the event of disability.	

The employment agreements do not provide for tax “gross ups” in the event such payments are made.

37

The following table summarizes the potential cash payments and estimated equivalent cash value of benefits that would be payable to the NEOs under the terms of their employment agreements under the various termination scenarios listed below, assuming the event occurred on December 31, 2014:

 	 	 	 	 	 	 	 	 	 	 	 	 	
Name	 	Without
Cause/
For Good
Reason
($)	 	Change-in-Control
(Termination
Without Cause/
For
Good Reason)
($)	 	Non-renewal by Us of
Initial or Subsequent
Term
($)	 	Death/
Disability
($)	
Donald A. Miller, CFA(1)	 	4,072,609	
 	 	4,072,609	
 	 	4,050,048	
 	 	4,050,048	
 	
Robert E. Bowers(2)	 	2,078,724	
 	 	2,078,724	
 	 	2,056,163	
 	 	2,056,163	
 	
Raymond L. Owens(3)	 	629,048	
 	 	629,048	
 	 	629,048	
 	 	629,048	
 	
Carroll A. Reddic, IV(4)	 	630,617	
 	 	630,617	
 	 	630,617	
 	 	630,617	
 	
________________________ 
 	 	
(1)	Includes $1,317,938 representing the value of unvested equity awards that would vest upon each triggering event.	
 	 	
(2)	Includes $513,810 representing the value of unvested equity awards that would vest upon each triggering event.	
 	 	
(3)	Includes $183,526 representing the value of unvested equity awards that would vest upon each triggering event.	
 	 	
(4)	Includes $183,526 representing the value of unvested equity awards that would vest upon each triggering event.	

DIRECTOR COMPENSATION FOR 2014
Compensation of Directors
We pay our non-employee directors a combination of cash and equity compensation for serving on the board of directors.

Cash Compensation
As compensation for serving on the board of directors during the first quarter of 2014, we paid each of our non-employee directors one-fourth of an annual retainer of $50,000 and paid our Chairman of the board an additional one-fourth of a $65,000 annual retainer. Additionally, we also paid one-fourth of annual retainers to our committee chairmen in the following amounts:
 	 	
•	$10,000 to the Chairman of the Audit Committee;	
 	 	
•	$7,500 to the Chairman of the Compensation Committee; and	
 	 	
•	$5,000 to the Chairman of each of our other committees.	
Finally, we paid our non-employee directors for attending board and committee meetings as follows:
 	 	
•	$1,500 per regularly scheduled board meeting attended; and	
 	 	
•	$1,500 per committee meeting attended (except that members of the Audit Committee were paid $2,500 per meeting attended for each of the four meetings necessary to review our quarterly and annual financial statements).	
Beginning with the second quarter of 2014, we increased the annual retainer paid to each Board member from $50,000 to $65,000 ($70,000 for Audit Committee members) and eliminated the additional board and committee meeting fees outlined above. In addition, the annual retainer paid to each committee chairperson was increased by $2,500.
All directors may receive reimbursement of reasonable out-of-pocket expenses incurred in connection with attendance at meetings of the board of directors. We do not provide any perquisites to our directors.
Annual Non-Employee Director Equity Awards
On May 9, 2014, the board of directors approved an annual equity award pursuant to the 2007 Omnibus Incentive Plan for each of the non-employee directors of $70,000 payable in the form of 3,725 shares of our common stock. The award is vested upon grant. The annual equity awards were determined based on the advice and recommendation of our compensation consultant after considering the peer group described in the Compensation Discussion and Analysis.
The following table sets forth information regarding the compensation that we paid to any person that served as one of our non-employee directors during the year ended December 31, 2014. Mr. Miller did not receive any additional compensation

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for his service as director in 2014.

 	 	 	 	 	 	 	 	 	 	 	 	 	
Name	 	Fees Earned or
Paid in Cash
($)	 	Stock
Awards
($)(1)	 	All Other
Compensation
($)	 	Total
($)	
Michael R. Buchanan	 	65,750	
 	 	70,000	
 	 	—	
 	 	135,750	
 	
Wesley E. Cantrell	 	65,750	
 	 	70,000	
 	 	—	
 	 	135,750	
 	
William H. Keogler, Jr.	 	70,500	
 	 	70,000	
 	 	—	
 	 	140,500	
 	
Frank C. McDowell	 	75,125	
 	 	70,000	
 	 	—	
 	 	145,125	
 	
Raymond G. Milnes, Jr.	 	82,375	
 	 	70,000	
 	 	—	
 	 	152,375	
 	
Donald S. Moss	 	70,500	
 	 	70,000	
 	 	—	
 	 	140,500	
 	
Jeffrey L. Swope	 	72,625	
 	 	70,000	
 	 	—	
 	 	142,625	
 	
W. Wayne Woody(2)	 	142,375	
 	 	70,000	
 	 	—	
 	 	212,375	
 	
________________________
 	 	
(1) 	Amount represents the grant date fair value for financial statement reporting purposes in accordance with FASB ASC Topic 718 and is based on the closing price of our common stock on May 14, 2014 of $18.79 per share. As of December 31, 2014, our non-employee directors held the following vested options: Mr. Buchanan, 667; Mr. Keogler, 667; and Mr. Moss, 667. Messrs. Cantrell, McDowell, Milnes, and Swope did not own any vested options. None of our non-employee directors held any unvested stock as of December 31, 2014.	
 	 	
(2) 	Mr. Woody was our former Chairman of the Board who passed away in January 2015.	

EQUITY COMPENSATION PLAN INFORMATION
Prior to the adoption of the 2007 Omnibus Incentive Plan, we granted equity awards under the 2000 Independent Director Stock Option Plan (the “Director Option Plan”). During 2007, our board of directors suspended the Director Option Plan; however, outstanding awards continued to be governed by the terms of the Director Option Plan. The following table summarizes outstanding director options as well as shares remaining for future issuance under the 2007 Omnibus Incentive Plan as of December 31, 2014:

 	 	 	 	 	 	 	 	 	 	 	
Plan category	 	Number of securities
to be issued upon
exercise of
outstanding
options,
warrants, and
rights
(#)	 	Weighted-average
exercise price of
outstanding options,
warrants, and rights	 	Number of securities
remaining available
for future issuance
under equity
compensation plans
(#)	
Equity compensation plans approved by security holders	 	2,668	
 	 	$	36.00	
 	 	2,747,627	
 	
Equity compensation plans not approved by security holders	 	—	
 	 	—	
 	 	—	
 	
Total	 	2,668	
 	 	$	36.00	
 	 	2,747,627	

REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee is responsible for, among other things, reviewing and approving compensation for the executive officers, establishing the performance goals on which the compensation plans are based and setting the overall compensation principles that guide the committee’s decision-making. The Compensation Committee has reviewed the Compensation Discussion and Analysis (“CD&A”) and discussed it with management. Based on the review and the discussions with management, the Compensation Committee recommended to the board of directors that the CD&A be included in this 2014 proxy statement and incorporated by reference into the Annual Report on Form 10-K for the year ended December 31, 2014.
The Compensation Committee:
Frank C. McDowell
William H. Keogler, Jr.
Barbara B. Lang
Jeffrey L. Swope
Compensation Committee Interlocks and Insider Participation
None of the members of our Compensation Committee is or has been employed by us. None of our executive officers currently serves, or in the past three years has served, as a member of the board of directors or Compensation Committee of

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another entity that has one or more executive officers serving on our board of directors.

COMPENSATION POLICIES AND PRACTICES AS THEY RELATE TO RISK MANAGEMENT

To address potential risk to our stockholders our Compensation Committee designed our compensation programs with the following characteristics:
 	 	
•	the Compensation Committee of the board of directors has discretion to reduce any award that is earned based on achievement of performance goals. If the Compensation Committee believes that any of the targets set forth in the compensation plans has been achieved in a manner that is not consistent with the long-term best interests of the Company’s stockholders, or believes that the overall compensation to be paid under the terms of the plan is not appropriate for any reason, the Compensation Committee may adjust down the calculated compensation associated with that plan accordingly;	
 	 	
•	oversight of programs (or components of programs) by a broad-based group of individuals, including human resources, finance, internal audit, and an independent compensation consultant;	
 	 	
•	a mix of compensation elements that provide focus on both short- and long-term goals as well as cash and equity-based compensation so as not to inappropriately emphasize one measure of our performance;	
 	 	
•	caps on the maximum payouts available under certain incentive programs, including both short and long-term incentive plans;	
 	 	
•	performance goals within incentive programs that reference reportable, broad-based financial metrics;	
 	 	
•	setting performance goals that are intended to be challenging yet provide employees a reasonable opportunity to reach the threshold amount, while requiring meaningful performance to reach the target level and substantial performance to reach the maximum level;	
 	 	
•	equity compensation awards that may be earned or vest over a number of years ensuring that our executives’ interests align with those of our stockholders over the long term; and	
 	 	
•	stock ownership guidelines that require our executive officers and directors to accumulate and maintain a significant ownership interest in the Company.	

CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Review, Approval or Ratification of Transactions with Related Persons

Our Code of Ethics, which is posted on our Web site at www.piedmontreit.com, prohibits directors and executive officers from engaging in transactions that may result in a conflict of interest with us. Our Audit and Nominating and Corporate Governance Committees review any transaction a director or executive officer proposes to have with us that could give rise to a conflict of interest or the appearance of a conflict of interest, including any transaction that would require disclosure under Item 404(a) of Regulation S-K. In conducting this review, these committees ensure that all such transactions are approved by a majority of the board of directors (including a majority of independent directors) not otherwise interested in the transaction and are fair and reasonable to us and on terms not less favorable to us than those available from unaffiliated third parties. No transaction has been entered into with any director or executive officer that does not comply with those policies and procedures. There were no transactions since January 1, 2014 that would require disclosure under Item 404(a) of Regulation S-K.

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STOCK OWNERSHIP
The following table sets forth certain information regarding the beneficial ownership of shares of our common stock as of February 28, 2015. Except as described below, each stockholder has sole investment and dispositive power over such shares.

 	 	 	 	 	 	 	
Name of Beneficial Owner(1)	 	Common Stock
Beneficially Owned	 	Percentage(9)	
Michael R. Buchanan(2)	 	30,045	
 	 	*	
 	
Wesley E. Cantrell	 	31,845	
 	 	*	
 	
William H. Keogler, Jr.(2)	 	46,697	
 	 	*	
 	
Barbara B. Lang	 	2,423	
 	 	*	
 	
Frank C. McDowell	 	34,184	
 	 	*	
 	
Raymond G. Milnes, Jr.	 	7,679	
 	 	*	
 	
Donald S. Moss(2)	 	55,395	
 	 	*	
 	
Jeffrey L. Swope	 	39,790	
 	 	*	
 	
Donald A. Miller, CFA(3)	 	382,835	
 	 	0.2	%	
Robert E. Bowers(4)	 	134,009	
 	 	0.1	%	
Raymond L. Owens(5)	 	63,608	
 	 	*	
 	
Carroll A. Reddic(6)	 	48,482	
 	 	*	
 	
Robert K. Wiberg(7)	 	16,930	
 	 	*	
 	
Blackrock, Inc.(8)	 	9,630,083	
 	 	6.2	%	
Invesco Ltd.(9)	 	14,604,273	
 	 	9.5	%	
Vanguard Specialized Funds - Vanguard REIT Index Fund(10)	 	11,457,419	
 	 	7.4	%	
FMR LLC(11)	 	16,905,578	
 	 	11.0	%	
The Vanguard Group, Inc.(12)	 	20,929,948	
 	 	13.6	%	
American Century Companies, Inc.(13)	 	8,045,451	
 	 	5.2	%	
All executive officers and directors as a group (16 persons)(15)	 	939,419	
 	 	0.6	%	
________________________

*	      Less than 0.01% of the outstanding common stock.	

(1) 	The address of each of the stockholders listed, other than Blackrock, Inc., Invesco Ltd., Vanguard Specialized Funds, FMR LLC, The Vanguard Group, Inc., and American Century Companies, Inc. is c/o Piedmont Office Realty Trust, Inc., 11695 Johns Creek Parkway, Suite 350, Johns Creek, Georgia 30097.	
 	 	
(2) 	Includes options to purchase up to 667 shares of common stock, which are exercisable within 60 days of February 28, 2015.	
 	 	
(3) 	Includes 24,968 shares vesting within 60 days of February 28, 2015.	
 	 	
(4) 	Includes 9,987 shares vesting within 60 days of February 28, 2015.	
 	 	
(5) 	Includes 3,567 shares vesting within 60 days of February 28, 2015.	
 	 	
(6) 	Includes 3,567 shares vesting within 60 days of February 28, 2015.	
 	 	
(7) 	Includes 1,756 shares vesting within 60 days of February 28, 2015.	
 	 	
(8) 	According to Amendment No. 2 to Schedule 13G filed on February 9, 2015, BlackRock Inc. has sole voting power over 9,097,303 shares and dispositive power over 9,630,083 shares. The address of Blackrock, Inc. is 55 East 52nd Street, New York, NY 10022.	
 	 	
(9) 	According to Amendment No. 4 to Schedule 13G filed on February 5, 2015, Invesco Ltd. has sole voting power over 6,016,016 shares and sole dispositive power over 14,604,273 shares. The address of Invesco Ltd. is 1555 Peachtree Street NE, Atlanta, GA 30309.	
 	 	
(10) 	According to Amendment No. 4 to Schedule 13G filed on February 6, 2015, Vanguard Specialized Funds - Vanguard REIT Index Fund has sole voting power over 11,457,419 shares. The address of Vanguard Specialized Funds is 100 Vanguard Blvd., Malvern, PA 19355.	
 	 	
(11) 	According to Amendment No. 2 to Schedule 13G filed on February 13, 2015, FMR LLC has sole voting power over 4,166,578 shares and sole dispositive power over 16,905,578 shares. The address of FMR LLC is 245 Summer Street, Boston, MA 02210.	
 	 	
(12) 	According to Amendment No. 5 to Schedule 13G filed on February 11, 2015, The Vanguard Group has sole voting power over 314,424 shares, shared voting power over 126,900 shares, sole dispositive power over 20,695,724 shares, and shared dispositive power over 234,224 shares. The address of the Vanguard Group, Inc. is 100 Vanguard Blvd., Malvern, PA 19355. We understand that The Vanguard Group, Inc. has determined that it does not own such shares for purposes of the 9.8% ownership limitation in our corporate charter (giving effect to the ownership definitions in our corporate charter), notwithstanding that it is deemed to beneficially own such shares for purposes of SEC regulations.	
 	 	
(13) 	According to Schedule 13G filed on February 10, 2015, American Century Companies, Inc. has sole voting power over 7,833,198 shares and sole dispositive power over 8,045,451 shares. The address of American Century Companies, Inc. is 4500 Main Street, 9th Floor, Kansas City, MO 64111.	
 	 	
(14) 	Based on 154,339,315 shares outstanding as of February 28, 2015.	
 	 	
(15) 	Includes 3,567 shares vesting within 60 days of February 28, 2015.	
None of the shares beneficially owned by our directors or executive officers are subject to pledge and no other persons own 5% or greater of our common stock. Derivative and hedging transactions involving Piedmont stock are strictly prohibited by our Insider Trading Policy.

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Section 16(a) Beneficial Ownership Reporting Compliance
Under Section 16(a) of the Exchange Act, directors, executive officers and any persons beneficially owning more than 10% of our common stock are required to file reports of ownership and changes in ownership of such stock with the SEC. Based solely on our review of copies of these reports filed with the SEC and written representations furnished to us by our officers and directors, we believe that all of the persons subject to the Section 16(a) reporting requirements filed the required reports on a timely basis with respect to fiscal year 2014.

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AUDIT COMMITTEE REPORT
Report of the Audit Committee
Pursuant to the Audit Committee Charter adopted by the board of directors of Piedmont, the Audit Committee’s primary function is to assist the board of directors in fulfilling its oversight responsibilities by overseeing the independent registered public accounting firm and reviewing the financial information to be provided to the stockholders and others, the system of internal control over financial reporting which management has established, and the audit and financial reporting process. The Audit Committee is composed of three independent directors and met six times in fiscal year 2014. Management of Piedmont has the primary responsibility for the financial statements and the reporting process, including the system of internal control over financial reporting. Membership on the Audit Committee does not call for the professional training and technical skills generally associated with career professionals in the field of accounting and auditing. In addition, the independent registered public accounting firm devotes more time and has access to more information than does the Audit Committee. Accordingly, the Audit Committee’s role does not provide any special assurances with regard to the financial statements of Piedmont, nor does it involve a professional evaluation of the quality of the audits performed by the independent registered public accounting firm.
In this context, in fulfilling its oversight responsibilities, the Audit Committee reviewed the audited financial statements in the Annual Report on Form 10-K with management, including a discussion of the quality and acceptability of the financial reporting and controls of Piedmont; the reasonableness of significant judgments; and the clarity of disclosures in the financial statements.
The Audit Committee reviewed with the independent registered public accounting firm, who is responsible for expressing an opinion on the conformity of those audited financial statements with U.S. generally accepted accounting principles, its judgments as to the quality and acceptability of the financial and such other matters as are required to be discussed with the Audit Committee under Statement on Auditing Standards No. 61, as amended, AICPA, Professional Standards, Vol. 1 AU, Section 380 as adopted by the Public Company Accounting Oversight Board in Rule 3200T, and other standards of the Public Company Accounting Oversight Board, rules of the Securities and Exchange Commission, and other applicable regulations. The Audit Committee also received from and discussed with the independent registered public accounting firm the written disclosures and the letter required by the applicable requirements of the Public Company Accounting Oversight Board relating to that firm’s independence from Piedmont and has discussed with that firm their independence. In addition, the Audit Committee considered the compatibility of non-audit services provided by the independent registered public accounting firm with the registered public accounting firm's independence.
The Audit Committee discussed with the independent registered public accounting firm the overall scope and plans for its audits. The Audit Committee meets periodically with the internal auditors and the independent registered public accounting firm, with and without management present, to discuss the results of their examinations, their evaluations of the internal controls, and the overall quality of the financial reporting of Piedmont.
In reliance on these reviews and discussions, the Audit Committee approved the audited financial statements of Piedmont be included in its Annual Report on Form 10-K for the year ended December 31, 2014 for filing with the Securities and Exchange Commission. The board of directors approved the Annual Report on Form 10-K for the year ended December 31, 2014 for filing with the Securities and Exchange Commission.
The Audit Committee
Raymond G. Milnes, Jr.(Chairman)
Michael R. Buchanan
Donald S. Moss
William H. Keogler, Jr.

The Report of the Audit Committee to stockholders is not “soliciting material” and is not deemed “filed” with the SEC and is not to be incorporated by reference in any filing of Piedmont under the Securities Act of 1933 or the Securities Exchange Act of 1934, whether made before or after the date hereof and irrespective of any general incorporation language in any such filing.

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STOCKHOLDER PROPOSALS

In order to be eligible for presentation at our 2016 annual meeting, our Bylaws require that written notice of any director nominations or other stockholder proposals must be received by our Secretary no earlier than November 3, 2015 and no later than December 3, 2015 at the following address: Thomas A. McKean, Secretary, Piedmont Office Realty Trust, 11695 Johns Creek Parkway, Suite 350, Johns Creek, Georgia 30097. Pursuant to Rule 14a-8 under the Exchange Act, stockholder proposals submitted for inclusion in our proxy statement for the 2016 Annual Meeting must be received by December 3, 2015.

HOUSEHOLDING
The SEC has adopted a rule concerning the delivery of disclosure documents. The rule allows us to send a single annual report, proxy statement, proxy statement combined with a prospectus, information statement, or Notice of Internet Availability of Proxy Materials to any household at which two or more stockholders reside if they share the same last name or we reasonably believe they are members of the same family. This procedure is referred to as “Householding.” This rule benefits both you and Piedmont. It reduces the volume of duplicate information received at your household and helps Piedmont reduce expenses. Each stockholder subject to Householding will continue to receive a separate proxy card or voting instruction card.

If any stockholders in your household wish to receive a separate annual report, proxy statement, or Notice of Internet Availability of Proxy Materials, they may call us at 866-354-3485, write to us at Piedmont Shareowner Services at P.O. Box 30170, College Station, TX 77842-3170 , or  e-mail us at investor.services@piedmontreit.com. If you are a stockholder that receives multiple copies of our proxy materials or Notice of Internet Availability of Proxy Materials, you may request Householding by contacting us in the same manner and requesting a householding consent.

OTHER MATTERS
As of the date of this proxy statement, we know of no business that will be presented for consideration at the Annual Meeting other than the items referred to herein. If any other matter is properly brought before the meeting for action by stockholders, proxies in the enclosed form returned to us will be voted in accordance with the recommendation of the board of directors or, in the absence of such a recommendation, in accordance with the discretion of the proxy holder.

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