8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 19, 2013

PARKWAY PROPERTIES, INC.

(Exact name of registrant as specified in its charter)

Maryland	1-11533	74-2123597
(State or other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

Bank of America Center, 390 North Orange Avenue, Suite 2400, Orlando, Florida 32801

(Address of Principal Executive Offices, including zip code)

(407) 650-0593

(Registrant's telephone number, including area code)

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o      Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o      Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o      Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 1.01 Entry Into a Material Definitive Agreement.

Pursuant to the terms of that certain Agreement and Plan of Merger, dated as of September 4, 2013 (the “Merger Agreement”), by and among Parkway Properties, Inc. (the “Company”), Parkway Properties LP (“Parkway LP”), PKY Masters, LP, a wholly owned subsidiary of Parkway LP (“Merger Sub”), Thomas Properties Group, Inc. (“TPGI”) and Thomas Properties Group, L.P. (“TPG LP”), the Company and the Company’s general partner, Parkway Properties General Partners Inc. (the “General Partner”), entered into Amendment No. 1 (“Amendment No. 1”) to the Second Amended and Restated Agreement of Limited Partnership of Parkway Properties LP (the “Partnership Agreement”) effective as of December 19, 2013.

Among other things, Amendment No. 1 amended the provision of the Partnership Agreement prohibiting the General Partner from merging, consolidating or selling all or substantially all of its assets or reclassifying, recapitalizing or changing its outstanding equity interests (a “Termination Transaction”) unless certain conditions are satisfied, by removing the General Partner from this prohibition and applying the prohibition instead to the Company. Pursuant to the amendment effected by Amendment No. 1, the Company may not engage in a Termination Transaction unless certain specified conditions are satisfied or unless partners representing at least 66 2/3 of the percentage interests consent to the transaction and the limited partners receive or have the right to receive cash, securities or other property in an amount calculated pursuant to the agreement to be generally equivalent to the consideration received by the holders of shares in the Company. Except as amended by the Amendment No. 1, the remaining terms of the Partnership Agreement remain in full force and effect.

In addition, on December 19, 2013, Mr. James A. Thomas and certain of his related parties entered into a tax protection agreement with Parkway LP (the “New Tax Protection Agreement”), that replaced an agreement originally entered into between TPG LP and Mr. Thomas (and certain of his related parties) dated October 13, 2004 (the “Original Tax Protection Agreement”). The New Tax Protection Agreement continued and updated the obligations under the Original Tax Protection Agreement with certain changes, including an undertaking by Parkway LP to offer certain related parties of Mr. Thomas the opportunity to guarantee, in the aggregate, up to $39 million of direct or indirect “qualifying” indebtedness of Parkway LP and agreement as to the method that Parkway LP will adopt in allocating depreciation with respect to certain of the properties acquired from TPGI and TGP LP. The obligations of Parkway LP under the New Tax Protection Agreement expire on October 13, 2016, although, as with the Original Tax Protection Agreement, Parkway LP agrees to offer the Thomas-related parties opportunities to guarantee qualifying indebtedness thereafter to the extent such indebtedness is available. A copy of the Original Tax Protection Agreement has been filed as Exhibit F to Exhibit 10.3 of TPGI’s Quarterly Report on Form 10-Q for the period ended September 30, 2004 filed with the Securities and Exchange Commission on November 22, 2004.

A copy of Amendment No. 1 and the New Tax Protection Agreement is attached to this Current Report on Form 8-K as Exhibit 10.1 and Exhibit 10.2 and incorporated by reference herein. The foregoing description of Amendment No. 1 and the New Tax Protection Agreement is not complete and is qualified in its entirety by reference to Amendment No. 1 and the New Tax Protection Agreement, respectively.

Item 2.01 Completion of Acquisition or Disposition of Assets.

On December 19, 2013, the Company completed the merger transactions contemplated by the Merger Agreement, pursuant to which TPGI merged with and into the Company, with the Company continuing as the surviving corporation (the “Parent Merger”), and TPG LP merged with and into Merger Sub, with TPG LP continuing as the surviving entity and an indirect wholly owned subsidiary of Parkway LP (the “Partnership Merger” and, together with the Parent Merger, the “Mergers”). Pursuant to the terms and subject to the conditions set forth in the Merger Agreement, at the effective time of the Parent Merger, each outstanding share of common stock, par value $0.01 per share, of TPGI (“TPGI Common Stock”) was converted into the right to receive 0.3822 (the “Exchange Ratio”) shares of the Company’s common stock, par value $0.001 per share (“Parkway Common Stock”), with cash paid in lieu of fractional shares, and each share of TPGI limited voting stock, par value $0.01 per share (“TPGI Limited Voting Stock”), was converted into the right to receive a number of shares of newly created Company limited voting stock, par value $0.001 per share (“Parkway Limited Voting Stock”), equal to the Exchange Ratio. Similarly, at the effective time of the Partnership Merger, which occurred immediately prior to the Parent Merger, each outstanding limited partnership interest in TPG LP (“TPG LP Units”), including long term incentive units, was converted into the right to receive a number of limited partnership units in Parkway LP (the “Parkway LP Units”) equal to the Exchange Ratio. The Company issued 18,362,513 shares of Parkway Common Stock as consideration in the Parent Merger and Parkway LP issued 4,537,110 Parkway LP Units in the Partnership Merger. Based on the closing price of the Company’s common stock on December 19, 2013 as reported on the New York Stock Exchange, the aggregate value of the merger consideration paid or payable to former holders of TPGI Common Stock was approximately $331.4 million, and the aggregate value of Parkway LP Units, which are convertible into Parkway’s common stock, issued to former holders of TPG LP Units was approximately $81.9 million.

A copy of the Merger Agreement has been previously filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 5, 2013 and is incorporated by reference herein. The foregoing description of the Merger Agreement is not complete and is qualified in its entirety by reference to the full text of the Merger Agreement.

Item 2.03 Creation of Direct Financial Obligations.

In connection with the completion of the Mergers, on December 19, 2013, subsidiaries of the Company assumed three mortgages secured by the CityWestPlace properties.

Two subsidiaries of the Company assumed two nonrecourse mortgage loans secured by CityWestPlace I and II and CityWestPlace III and IV. CityWestPlace is an approximately 1.4 million square foot office complex in Houston, Texas. The mortgage secured by CityWestPlace I and II, with a principal amount of approximately $117.7 million, bears interest at a rate of 6.16% and matures on July 6, 2016. The mortgage requires monthly payments of principal and interest and may not be prepaid prior to 90 days prior to the maturity date except that the mortgage may be defeased pursuant to customary defeasance procedures. The mortgage is nonrecourse to the Company except that Parkway LP has guaranteed to the lender the payment of certain amounts to be paid in connection with the recently executed Statoil Oil Services lease. The mortgage secured by CityWestPlace III and IV, for a principal amount of approximately $93.5 million, bears interest at a rate of 5.03% and matures on March 5, 2020. The mortgage requires monthly payments of principal and interest and may be prepaid with a prepayment fee equal to the greater of 1% of the amount prepaid or a yield maintenance based calculation, provided no prepayment fee is due during the last 60 days prior to maturity. Parkway LP has executed a guaranty of certain customary exceptions to non-recourse liability.

The agreements governing all of the mortgages contain customary rights of the lender to accelerate the loan upon, among other things, a payment default or if certain representations and warranties made by the borrower are untrue.

Item 5.02 Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On December 19, 2013, effective as of the effective time of the Parent Merger, as approved by resolutions of the Company’s board of directors and pursuant to the terms of the Merger Agreement, the number of directors on the Company’s board of directors was increased to ten and James A. Thomas was appointed to the Company’s Board to serve as Chairman of the board. Mr. Thomas, age 77, served as Chairman of the Board, President and Chief Executive Officer of TPGI, a real estate company that owned, acquired, developed and managed primarily office properties and that merged with the Company in the Parent Merger, from October 2004 to December 2013. Prior to this, Mr. Thomas founded TPGI’s predecessor group of entities and served as their Chairman of the Board and Chief Executive Officer from 1996 to October 2004. From 1983 to 1996, Mr. Thomas served as a co-managing partner of Maguire Thomas Partners, a national full-service real estate operating company which included TPGI’s predecessor group of entities. Mr. Thomas also served as Chief Executive Officer and principal owner of the Sacramento Kings National Basketball Association team and the ARCO Arena from 1992 until 1999. He is a member of the Real Estate Roundtable and the National Association of Real Estate Investment Trusts. Mr. Thomas received his Bachelor of Arts degree in economics and political science with honors from Baldwin Wallace College and graduated magna cum laude with a juris doctorate degree from Cleveland Marshall Law School.

Mr. Thomas has over 50 years of experience in the real estate industry and has extensive knowledge of the industry, as well as extensive business relationships with investors, financial institutions and peer companies.

Mr. Thomas will receive compensation consistent with that received by the Company’s other non-employee directors as disclosed in the Company’s definitive proxy statement, filed with the Securities and Exchange Commission on April 4, 2013, in connection with the Company’s 2013 annual meeting of stockholders.

The Company’s directors prior to the effectiveness of the Parent Merger will continue as directors of the Company.

Item 5.03 Amendments to Articles of Incorporation or Bylaws

On December 18, 2013, the Company filed an amendment to its Articles of Incorporation, as amended (the “Charter”), with the State of Maryland State Department of Assessments and Taxation (the “MSDAT”) to increase the total number of authorized shares of capital stock from 150,000,000 to 250,000,000 (the “Charter Amendment”).  The Charter Amendment became effective upon filing.

In addition, on December 18, 2013, the Company filed Articles Supplementary reclassifying 4,500,000 shares of the Company’s common stock as Parkway Limited Voting Stock, with the MSDAT (the “Articles Supplementary”). The Articles Supplementary became effective upon filing. The terms, rights, obligations and preferences of the Parkway Limited Voting Stock, as contained in the Articles Supplementary, are described below.

Dividend Rights

No dividends or other distributions will be paid with respect to the shares of Parkway Limited Voting Stock and holders of Parkway Limited Voting Stock are not entitled or eligible to receive any dividends or other distributions from the Company with respect to the Parkway Limited Voting Stock.

Voting Rights

Each share of Parkway Limited Voting Stock entitles the holder to one vote on the following matters only, and only in circumstances for which such holders are entitled to vote by the Charter, or as otherwise required by the Maryland General Corporation Law (the “MGCL”): (i) the election of directors; (ii) any amendment, alteration or repeal of any provision of the Charter; (iii) any merger, consolidation, reorganization or other business combination of the Company with or into any other entity; (iv) the sale, lease, exchange, transfer, conveyance or other disposition of all or substantially all the Company’s assets in a single transaction or series of related transactions; or (v) any liquidation, dissolution or winding up of the Company. With respect to any matter on which the holders of Parkway Limited Voting Stock are entitled to vote, the holders of Parkway Limited Voting Stock and the Company’s common stock will vote together as a single class, except as otherwise required by the MGCL.

Redemption Rights

In the event that a holder of shares of Limited Voting Stock transfers (1) any one share of Parkway Limited Voting Stock and one unit of limited partnership interest of Parkway LP (collectively, a “Paired Unit”) to any person other than a permitted transferee (as defined in the Articles Supplementary), (2) any share of Parkway Limited Voting Stock separate and apart from a unit of limited partnership interest of Parkway LP with which the Parkway Limited Voting Stock is paired (the “Paired Partnership Unit”), (3) any Paired Partnership Unit separate and apart from the share of Parkway Limited Voting Stock with which it is paired, then in each case the share of Parkway Limited Voting Stock included in such Paired Unit shall automatically be redeemed by the Company without consideration. In the event that any Paired Partnership Unit is redeemed pursuant to the terms and conditions of the Partnership Agreement, the share of Parkway Limited Voting Stock paired with such Paired Partnership Unit shall automatically be redeemed by the Company without consideration. In addition, to the extent that a share of Parkway Limited Voting Stock is not otherwise paired with a Partnership Unit, such share shall automatically be redeemed by the Company without consideration.

Conversion Rights

Parkway Limited Voting Stock is not convertible into or exchangeable for any other properties or securities of the Company.

A copy of the Charter Amendment and the Articles Supplementary are attached to this Current Report on Form 8-K as Exhibit 3.1 and Exhibit 3.2, respectively, and incorporated by reference herein. The foregoing summary of the Charter Amendment and the Articles Supplementary is qualified in its entirety by reference to the Charter Amendment and the Articles Supplementary.

Item 8.01 Other Events.

On December 19, 2013, immediately following the completion of the Mergers, the joint venture interests acquired by the Company in One Commerce Square and Two Commerce Square, two office towers located in Philadelphia, Pennsylvania totaling approximately 1.9 million rentable square feet, were redeemed by the joint ventures that own the respective properties. The Company received net proceeds of approximately $71.8 million in the redemption transactions, which were funded by Brandywine Operating Partnership, L.P. (“Brandywine”), the partner in each of the joint ventures. In addition, on December 19, 2013, immediately following the completion of the Mergers, the Company also sold the Four Points Centre, two office buildings located in Austin, Texas each containing approximately 194,000 rentable square feet, to Brandywine for a gross sales price of $47.3 million.

On December 20, 2013, the Company issued a press release announcing the closing of the Mergers. The full text of the press release is attached hereto as Exhibit 99.1 and is incorporated herein in its entirety by reference.

Item 9.01. Financial Statements and Exhibits

(a) Financial Statements of Businesses Acquired

The audited consolidated financial statements of Thomas Properties Group, Inc. as of December 31, 2012 and 2011 and for each of the years in the three year period ended December 31, 2012 have been previously filed as Exhibit 99.1 to the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 4, 2013 and incorporated in this Item 9.01(a) by reference.

To the extent required by this item, unaudited consolidated financial statements of Thomas Properties Group, Inc. as of September 30, 2013 and for the three and nine month periods ended September 30, 2013 and 2012 will be filed in an amendment to this current report on Form 8-K no later than 71 calendar days after the date this report is required to be filed.

(b) Pro Forma Financial Information

To the extent required by this item, pro forma financial statements relating to the acquisition of Thomas Properties Group, Inc. will be filed in an amendment to this current report on Form 8-K no later than 71 calendar days after the date this report is required to be filed.

(d) Exhibits

Exhibit Number	Description
Exhibit 2.1	Agreement and Plan of Merger dated as of September 4, 2013 by and among Parkway Properties, Inc., Parkway Properties LP, PKY Masters, LP, Thomas Properties Group, Inc. and Thomas Properties Group, L.P., (incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 5, 2013)
Exhibit 3.1	Amendment to Parkway Properties, Inc. Articles of Incorporation, as amended, dated December 18, 2013
Exhibit 3.2	Articles Supplementary Reclassifying 4,500,000 Shares of Common Stock into Limited Voting Stock, dated December 18, 2013
Exhibit 10.1	Amendment No. 1 to the Second Amended and Restated Agreement of Limited Partnership of Parkway Properties LP dated December 19, 2013 between the Parkway Properties, Inc. and Parkway Properties General Partners Inc.
Exhibit 10.2	Tax Protection Agreement dated as of December 19, 2013 by and among Thomas Properties Group, L.P., James A. Thomas, individually and as Trustee of the Lumbee Clan Trust, and the other persons listed on the signature pages thereto
Exhibit 10.3	Tax Protection Agreement dated as of October 13, 2004 by and among Thomas Properties Group, L.P., James A. Thomas, individually and as Trustee of the Lumbee Clan Trust, and the persons listed on the signature pages thereto (incorporated by reference to Exhibit F to Thomas Properties Group, Inc.’s Quarterly Report on Form 10-Q for the period ended September 30, 2004 filed with the Securities and Exchange Commission on November 22, 2004)
Exhibit 99.1	Press Release dated December 20, 2013
Exhibit 99.2	Audited consolidated financial statements of Thomas Properties Group, Inc. as of December 31, 2012 and 2011, and for each of the years in the three year period ended December 31, 2012 (incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 4, 2013)

SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date:    December 24, 2013

PARKWAY PROPERTIES, INC.

By: /s/ Jeremy R. Dorsett            

Jeremy R. Dorsett

Executive Vice President and

General Counsel

EXHIBIT INDEX

Exhibit Number	Description
Exhibit 2.1	Agreement and Plan of Merger dated as of September 4, 2013 by and among Parkway Properties, Inc., Parkway Properties LP, PKY Masters, LP, Thomas Properties Group, Inc. and Thomas Properties Group, L.P., (incorporated by reference to Exhibit 2.1 of the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on September 5, 2013)
Exhibit 3.1	Amendment to Parkway Properties, Inc. Articles of Incorporation, as amended, dated December 18, 2013
Exhibit 3.2	Articles Supplementary Reclassifying 4,500,000 Shares of Common Stock into Limited Voting Stock, dated December 18, 2013
Exhibit 10.1	Amendment No. 1 to the Second Amended and Restated Agreement of Limited Partnership of Parkway Properties LP dated December 19, 2013 between the Parkway Properties, Inc. and Parkway Properties General Partners Inc.
Exhibit 10.2	Tax Protection Agreement dated as of December 19, 2013 by and among Thomas Properties Group, L.P., James A. Thomas, individually and as Trustee of the Lumbee Clan Trust, and the other persons listed on the signature pages thereto
Exhibit 10.3	Tax Protection Agreement dated as of October 13, 2004 by and among Thomas Properties Group, L.P., James A. Thomas, individually and as Trustee of the Lumbee Clan Trust, and the persons listed on the signature pages thereto (incorporated by reference to Exhibit F to Thomas Properties Group, Inc.’s Quarterly Report on Form 10-Q for the period ended September 30, 2004 filed with the Securities and Exchange Commission on November 22, 2004)
Exhibit 99.1	Press Release dated December 20, 2013
Exhibit 99.2	Audited consolidated financial statements of Thomas Properties Group, Inc. as of December 31, 2012 and 2011, and for each of the years in the three year period ended December 31, 2012 (incorporated by reference to Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed with the Securities and Exchange Commission on October 4, 2013)

EX-3.1

EXHIBIT 3.1

PARKWAY PROPERTIES, INC.

ARTICLES OF AMENDMENT

Parkway Properties, Inc., a Maryland corporation (the “Corporation”), hereby certifies to the State Department of Assessments and Taxation of Maryland that:

FIRST: The Articles of Incorporation (the “Charter”) of the Corporation are hereby amended to delete the current ARTICLE V, Section 1 of the Charter and replace it with the following:

“Section 1. Authorized Capital Stock

(a) Authorized Shares. The total number of shares of capital stock of all classes that the Corporation has authority to issue is 250,000,000. Of these shares of capital stock, 220,000,000 shares are classified as Common Stock, par value $0.001 per share (the “Common Stock”), and 30,000,000 shares are classified as Excess Stock, par value $0.001 per share (the “Excess Stock”). The Common Stock and the Excess Stock shall each constitute a separate class of capital stock of the Corporation.

(b) Terminology and Aggregate Par Value. All classes of capital stock (except Excess Stock) are referred to herein as “Equity Stock”; all classes of capital stock (including Excess Stock) are referred to herein as “Stock”. The aggregate par value of all of the Corporation’s authorized Stock is $250,000.”

SECOND: The amendment to the Charter as set forth above has been duly advised by the Board of Directors and approved by the stockholders of the Corporation as required by law.

THIRD: Immediately prior to the above amendment, the Corporation had authority to issue 150,000,000 shares of stock, consisting of 120,000,000 shares of Common Stock, par value $0.001 per share; and 30,000,000 shares of Excess Stock, par value $0.001 per share. The aggregate par value of all authorized shares of all classes of stock having par value was $150,000.

FOURTH: The total number of shares of stock which the Corporation has authority to issue pursuant to the foregoing amendment is 250,000,000, consisting of 220,000,000 shares of Common Stock, par value $0.001 per share, and 30,000,000 shares of Excess Stock, par value $0.001 per share. The aggregate par value of all authorized shares of all classes of stock having par value is $250,000.

FIFTH: The information required by Section 2-607(b)(2)(i) of the Maryland General Corporation Law was not changed by the foregoing amendment.

SIXTH: The undersigned officer acknowledges these Articles of Amendment to be the corporate act of the Corporation and as to all matters of facts required to be verified under oath, the undersigned officer acknowledges that to the best of his knowledge, information and belief, these matters and facts are true in all material respects and that this statement is made under the penalties of perjury.

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IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment to be executed under seal in its name and on its behalf by the undersigned officer, and attested to by its Secretary, on this 18^th day of December, 2013.

PARKWAY PROPERTIES, INC.

/s/ David O’Reilly

Name: David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

/s/ Jeremy R. Dorsett

Name: Jeremy Dorsett

Title: Executive Vice President, General Counsel and Secretary

EX-3.2

EXHIBIT 3.2

ARTICLES SUPPLEMENTARY

RECLASSIFYING 4,500,000 SHARES OF COMMON STOCK INTO

LIMITED VOTING STOCK

PARKWAY PROPERTIES, INC.

PARKWAY PROPERTIES, INC., a Maryland corporation (the “Corporation”), hereby certifies to the Maryland State Department of Assessments and Taxation that:

FIRST: Pursuant to authority granted to and vested in the Board of Directors of the Corporation (the “Board”) by Article V, Section 3 the Charter of the Corporation (the “Charter”), and pursuant to the provisions of Section 2-208 of the Maryland General Corporation Law (the “MGCL”), the Board, at a meeting held on September 4, 2013, adopted resolutions duly classifying 4,500,000 shares of Common Stock, par value $.001 per share (the “Common Stock”), of the Corporation into a new series of 4,500,000 shares of capital stock to be designated as “Limited Voting Stock, par value $.001 per share,” of the Corporation (the “Limited Voting Stock”) and has provided for the issuance of such shares.

SECOND: The reclassification increases the number of shares classified as Limited Voting Stock from no shares immediately prior to the reclassification to 4,500,000 shares immediately after the reclassification. The reclassification decreases the number of shares classified as Common Stock from 220,000,000 shares immediately prior to the reclassification to 215,500,000 shares immediately after the reclassification.

THIRD: Subject in all cases to the provisions of Article V of the Charter, the following is a description of the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of the Limited Voting Stock of the Corporation:

Section 1.Certain Definitions. For purposes of these Articles Supplementary, the following capitalized terms shall have the meanings set forth below:

(i)“Affiliate” shall mean, with respect to any Person, any Person directly or indirectly controlling, controlled by, or under common control with such Person. Control of any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities or interests, by contract or otherwise, and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

(ii)“Immediate Family Member” shall mean, with respect to any natural Person, such natural Person’s estate or heirs or current spouse or former spouse, parents, parents-in-law, children (whether natural, adopted or by marriage), siblings and grandchildren and any trust or estate, all of the beneficiaries of which consist of such Person or such Person’s spouse, or former spouse, parents, parents-in-law, children, siblings or grandchildren.

(iii)“Operating Partnership” shall mean Parkway Properties LP, a Delaware limited partnership.

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(iv)“Paired Partnership Unit” shall mean, with respect to a share of the Corporation’s Limited Voting Stock, the Partnership Unit that is paired with such share of Limited Voting Stock with on a one-for-one basis.

(v)“Paired Unit” shall mean a unit consisting of one share of Limited Voting Stock and one Partnership Unit, issued simultaneously and on a one-for-one basis.

(vi)“Partnership Agreement” shall mean the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, as the same may be amended from time to time.

(vii)“Partnership Unit” shall mean a unit of limited partnership interest in the Operating Partnership.

(viii)“Permitted Transferee” shall mean (a) a Person to whom Limited Voting Stock is issued by the Corporation, (b) an Affiliate of a Person referred to in the preceding clause (a), (c) an Immediate Family Member of a natural Person referred to in the preceding clause (a), (d) a trust for the benefit of a charitable beneficiary, or (e) a charitable foundation.

(ix)“Transfer” shall mean any direct or indirect sale, assignment, hypothecation or other transfer of any Paired Unit.

Section 2.Designation and Amount. This series of Equity Stock (as defined in the Charter) is designated as Limited Voting Stock, par value $.001 per share. The number of shares constituting the Limited Voting Stock shall be 4,500,000.

Section 3.Limitations. Without limitation of the other provisions of the Charter (including Article V thereunder), any issuance and/or transfer of Limited Voting Stock that would result in any violation of any restriction on ownership and/or transfer set forth in Section 2(b) of the Charter shall be void ab initio, as to the issuance and/or transfer of such shares of Limited Voting Stock that would violate any such restriction, and the intended recipient or transferee thereof, as the case may be, shall acquire no rights in such shares of Limited Voting Stock.

Section 4.Dividend Rights. No dividends or other distributions shall be paid with respect to the shares of Limited Voting Stock, and the holders thereof shall not be entitled or eligible to receive and shall not receive any dividends or other distributions from the Corporation with respect thereto.

Section 5.Voting Rights.

(a)Limited Voting Rights. Each share of Limited Voting Stock shall entitle the holder thereof to one (1) vote on the following matters only, and only in circumstances in which holders of Common Stock are entitled to vote pursuant to the Charter or as otherwise required by the MGCL:

(i)the election of directors;

(ii)any amendment, alteration or repeal of any provision of the Charter;

(iii)any merger, consolidation, reorganization or other business combination of the Corporation with or into any other entity;

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(iv)the sale, lease, exchange, transfer, conveyance or other disposition of all or substantially all the Corporation’s assets in a single transaction or series of related transactions; or

(v)any liquidation, dissolution or winding up of the Corporation.

Except as otherwise set forth in this Section 5(a), or except as otherwise from time to time required by the MGCL, the holders of shares of Limited Voting Stock will have no voting rights.

(b)Voting as a Single Class. With respect to any matter on which the Limited Voting Stock is entitled to vote pursuant to the provisions of Section 5(a) of this Article Third, the Common Stock and the Limited Voting Stock shall vote together as a single class, except if otherwise required by the MGCL.

Section 6.Redemption Rights. The Limited Voting Stock has the following redemption rights:

(i)In the event that a holder of shares of Limited Voting Stock shall Transfer (1) any Paired Unit to any Person other than a Permitted Transferee, (2) any share of Limited Voting Stock separate and apart from the Paired Partnership Unit with which it is paired, (3) any Paired Partnership Unit separate and apart from the share of Limited Voting Stock with which it is paired, then in each case the share of Limited Voting Stock included in such Paired Unit shall automatically and without further action be redeemed by the Corporation without consideration.

(ii)In the event that any Paired Partnership Unit is redeemed pursuant to the terms and conditions of the Partnership Agreement, the share of Limited Voting Stock paired with such Paired Partnership Unit shall automatically and without further action be redeemed by the Corporation without consideration.

(iii)To the extent that a share of Limited Voting Stock is not otherwise paired with a Partnership Unit, such share shall automatically and without further action be redeemed by the Corporation without consideration.

Section 7.Liquidation Rights.In the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, the holders of Limited Voting Stock shall not be entitled to any distributions.

Section 8.Conversion.The Limited Voting Stock is not convertible into or exchangeable for any other property or securities of the Corporation.

Section 9.Status of Redeemed Stock.  All shares of Limited Voting Stock that have been issued and redeemed or reacquired in any manner by the Corporation shall be returned to the status of authorized but unissued shares of Limited Voting Stock. The Board may reclassify any unissued shares of Limited Voting Stock from time to time in one or more classes or series of Equity Stock (as defined in the Charter).

Section 10.Rights of Objecting Stockholders. Holders of Limited Voting Stock shall not be entitled to exercise the rights of objecting stockholders under Title 3, Subtitle 2 of the MGCL.

[Signature page follows.]

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IN WITNESS WHEREOF, PARKWAY PROPERTIES, INC. has caused these presents to be signed in its name and on its behalf by its Executive Vice President, Chief Financial Officer and Chief Investment Officer and witnessed by its Executive Vice President, General Counsel and Secretary on December 18, 2013.

PARKWAY PROPERTIES, INC.

/s/ David O’Reilly

Name:David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

WITNESS

/s/ Jeremy R. Dorsett

Name:Jeremy R. Dorsett

Title: Executive Vice President, General Counsel and Secretary

THE UNDERSIGNED, Executive Vice President, Chief Financial Officer and Chief Investment Officer of PARKWAY PROPERTIES, INC., who executed on behalf of the Corporation the Articles Supplementary of which this certificate is made a part, hereby acknowledges in the name and on behalf of said Corporation the foregoing Articles Supplementary to be the corporate act of said Corporation and hereby certifies that the matters and facts set forth herein with respect to the authorization and approval thereof are true in all material respects under penalties of perjury.

/s/ David O’Reilly

Name:David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

EX-10.1

EXHIBIT 10.1

AMENDMENT NO. 1

TO

SECOND AMENDED AND RESTATED

AGREEMENT OF LIMITED PARTNERSHIP

OF

PARKWAY PROPERTIES LP

THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED AGREEMENT OF LIMITED PARTNERSHIP (“Amendment No. 1”), dated as of December 19, 2013, is entered into by and between Parkway Properties Inc., a Maryland corporation (the “Company”), and Parkway Properties General Partners Inc. (the “General Partner”), a Delaware corporation, and amends that certain Second Amended and Restated Agreement of Limited Partnership of Parkway Properties LP (the “Partnership”), a Delaware limited partnership, dated February 27, 2013 (the “Partnership Agreement”).

WHEREAS, pursuant to the terms of Section 7.3 of the Partnership Agreement, the General Partner, in its capacity as general partner of the Partnership, and the Company, as the holder of a Majority in Interest of the Limited Partners, wish to amend the Partnership Agreement on the terms as set forth herein.

NOW, THEREFORE, BE IT RESOLVED, that for good and adequate consideration, the receipt of which is hereby acknowledged, the parties hereto agree as follows:

Section 1AMENDMENTS

(a)Section 11.2 of the Partnership Agreement hereby is amended by deleting current paragraphs (b) and (c) and replacing such paragraph with the following new paragraphs (b) and (c):

“(b)Except as otherwise provided in Section 11.2(c), the Company shall not engage in any merger, consolidation or other combination with or into another person, sale of all or substantially all of its assets or any reclassification, recapitalization or change of its outstanding equity interests (each, a “Termination Transaction”), unless the Termination Transaction has been approved by a Consent of the Partners and in connection with which all Limited Partners either will receive, or will have the right to elect to receive, for each Partnership Unit an amount of cash, securities, or other property equal to the product of the REIT Shares Amount and the greatest amount of cash, securities or other property paid to a holder of one REIT Share in consideration of one REIT Share pursuant to the terms of the Termination Transaction; PROVIDED THAT, if, in connection with the Termination Transaction, a purchase, tender or exchange offer shall have been made to and accepted by the holders of more than thirty-three and one-third percent (33.3 %) of the outstanding REIT Shares, each holder of Partnership Units shall receive, or shall have the right to elect to receive, the greatest amount of cash, securities, or other property which such holder would have received had it exercised its right to Redemption (as set forth in Section 8.6) and received REIT Shares in exchange for its Partnership Units immediately prior to the expiration of such purchase, tender or exchange offer and had thereupon accepted such purchase, tender or exchange offer.

(c)Notwithstanding Section 11.2(b), the Company may merge, or otherwise combine its assets, with another entity if: (i) immediately after such merger or other combination, substantially all of the assets directly or indirectly owned by the surviving entity, other than Partnership Units held by the Company, are owned directly or indirectly by the

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Partnership or another limited partnership or limited liability company which is the survivor of a merger, consolidation or combination of assets with the Partnership (in each case, the “Surviving Partnership”); (ii) the Limited Partners own a percentage interest of the Surviving Partnership based on the relative fair market value of the net assets of the Partnership (as determined pursuant to Section 11.2(e) and the other net assets of the Surviving Partnership (as determined pursuant to Section 11.2(e)) immediately prior to the consummation of such transaction; (iii) the rights, preferences and privileges of the Limited Partners in the Surviving Partnership are at least as favorable as those in effect immediately prior to the consummation of such transaction and as those applicable to any other limited partners or non-managing members of the Surviving Partnership; and (iv) such rights of the Limited Partners include the right to exchange their interests in the Surviving Partnership for at least one of: (a) the consideration available to such Limited Partners pursuant to Section 11.2(b) or (b) if the ultimate controlling person of the Surviving Partnership has publicly traded common equity securities, such common equity securities, with an exchange ratio based on the relative fair market value of such securities (as determined pursuant to Section 11.2(e)) and the REIT Shares.”

(b)Section 11.3 of the Partnership Agreement hereby is amended by deleting the last sentence of paragraph (a) thereof and replacing such sentence with the following new sentence:

“Each Limited Partner or Assignee (resulting from a transfer made pursuant to clauses (i)-(iv) of the preceding sentence) shall have the right to transfer all or any portion of its Partnership Interest, subject to the satisfaction of each of the following conditions (in addition to the right of each such Limited Partner or Assignee to continue to make any such transfer permitted by clauses (i)-(iv) of such sentence without satisfying either of the following conditions):”

(c)Subject to, and effective only upon, consummation of the merger (the “Merger”) of Thomas Properties Group, Inc. (“TPGI”) with and into the Company pursuant to that certain Agreement and Plan of Merger dated September 4, 2013 by and among TPGI, Thomas Properties Group, L.P., the Company, the Partnership and PKY Masters, LP, the Partnership Agreement shall be amended by deleting existing Exhibit A thereto and replacing such exhibit with new Exhibit A attached hereto.

Section 2 NO OTHER CHANGES

Except as expressly amended hereby, the Partnership Agreement shall in all respects continue in full force and effect and the General Partner and the Company ratify and confirm that they continue to be bound by the terms and conditions thereof.

Section 3APPLICABLE LAW

This Amendment No. 1 shall be construed in accordance with and governed by the laws of the State of Delaware, without regard to the principles of conflicts of law.

Section 4CAPITALIZED TERMS

All capitalized terms used in this Amendment No. 1 and not otherwise defined herein shall have the meanings assigned to such terms in the Partnership Agreement.

[Signature page follows.]

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IN WITNESS WHEREOF, the parties hereto have executed this Amendment No. 1 to the Second Amended and Restated Partnership Agreement of Parkway Properties, LP as of the date first written above.

THE GENERAL PARTNER:

PARKWAY PROPERTIES GENERAL PARTNERS INC.

By: /s/ David O’Reilly

Name: David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

By: /s/ Jeremy Dorsett

Name: Jeremy Dorsett

Title: Executive Vice President, General Counsel and Secretary

THE COMPANY:

PARKWAY PROPERTIES, INC.

By: /s/ David O’Reilly

Name: David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

By: /s/ Jeremy Dorsett

Name: Jeremy Dorsett

Title: Executive Vice President, General Counsel and Secretary

Exhibit A

PARKWAY PROPERTIES LP

EXHIBIT A

Partner	Partnership	Certificate Number (If Applicable)
Parkway Properties, Inc. (the “Company”)1	68,625,9832 Common Limited Partnership Units3	N/A
Lane N. Meltzer4	1,318 Common Limited Partnership Units	N/A
Eleonora A. Silverman5	278,817 Common Limited Partnership Units	011
Eleonora A. Silverman5      Andrew Silverman5      Andrew Silverman5      Alexander D. Silverman5      Alexander D. Silverman5	66,783 Common Limited Partnership Units6 223,635 Common Limited Partnership Units 53,565 Common Limited Partnership Units6 223,635 Common Limited Partnership Units 53,565 Common Limited Partnership Units6	012 013 014 015 016
Parkway Properties General Partners, Inc.7	110,958 Class A Common General Partnership Units	N/A
Maguire Thomas Partners - Philadelphia, Ltd. 8	1,343,263 Common Limited Partnership Units	N/A
Thomas Investment Partners, Ltd.8	1,224,859 Common Limited Partnership Units	N/A
Maguire Thomas Partners - Commerce Square II, Ltd.8	882,290 Common Limited Partnership Units	N/A
The Lumbee Clan Trust8	708,147 Common Limited Partnership Units	N/A
Thomas Master Investments, LLC8	240,592 Common Limited Partnership Units	N/A
Thomas Partners, Inc.8	52,310 Common Limited Partnership Units	N/A
Diana Laing 8	44,564 Common Limited Partnership Units	N/A
John R. Sischo8	21,657 Common Limited Partnership Units	N/A
Paul Rutter 8	14,332 Common Limited Partnership Units	N/A
Thomas S. Ricci8	5,096 Common Limited Partnership Units	N/A

1 Capital Contribution consists of $9,900 plus those properties contributed subsequent to the Effective Date.

2	The number of Common Limited Partnership Units as of December 18, 2013 that will be increased following completion of the Merger in an amount that corresponds to the number of shares of common stock of the Company issued in connection with the Merger.
3	Adjusted from time to time to take into account redemptions and issuances of stock by the Company and the corresponding unit issuances and redemptions by the Partnership.

4 Capital Contribution consists of 47.5% General Partnership Interest in and to the 111 Capitol Building Limited Partnership to Parkway Jackson LLC (a limited liability company which is wholly owned by the Limited Partnership).

5	Capital Contribution consists of 100% membership interest in PKY Lincoln Place LLC, a Delaware limited liability company, as the owner of Lincoln Place, 1601 Washington Avenue, Miami Beach, Florida, as assigned to PKY Lincoln Place Holdings, LLC (a limited liability company which is wholly owned by the Limited Partnership).
6	Pledged to PKY Lincoln Place Holdings, LLC pursuant to Indemnity Pledge Agreement, dated December 6, 2013.
7	Capital Contribution consists of $100 plus those properties contributed subsequent to the Effective Date.
8	Capital Contribution consists of the operating partnership units of Thomas Properties Group, LP that were exchanged for Common Limited Partnership Units in connection with the mergers pursuant to that certain agreement and plan of merger between Parkway Properties, Inc., the Partnership, PKY Masters LP, Thomas Properties Group, Inc. and Thomas Properties Group, L.P. dated September 4, 2013.

EX-10.2

EXHIBIT 10.2

TAX PROTECTION AGREEMENT

This TAX PROTECTION AGREEMENT (this “Agreement”) dated as of December 19, 2013 is entered into by and among (i) PARKWAY PROPERTIES, L.P., a Maryland limited partnership (the “Operating Partnership”), (ii) JAMES A. THOMAS, individually and as Trustee of the Lumbee Clan Trust (“Thomas”), and (iii) those persons and entities listed on the signature page hereto under the caption “THOMAS INVESTORS” (each, a “Thomas Investor” and collectively the “Thomas Investors”).

RECITALS

A.In 2004, James A. Thomas, individually and as Trustee of the Lumbee Clan Trust, the Thomas Investors, Thomas Properties Group, L.P., a Maryland limited partnership (“TPG LP”), and certain other persons entered into a Contribution Agreement dated October 13, 2004 (the “Contribution Agreement”) in which, among other things, TPG LP agreed to certain limitations on its ability to sell its direct or indirect interests in certain property and to use commercially reasonable efforts to make certain secured mortgage debt available to be guaranteed by the Thomas Investors, as set forth on Exhibit F to the Contribution Agreement (such Exhibit F, the “Original Tax Protection Agreement”).

B.Each of the “Parent Merger” and the “Partnership Merger” (each as defined in that Agreement and Plan of Merger dated as of September 4, 2013 by and between Parkway Properties, Inc., a Maryland corporation (“Parkway”), the Operating Partnership, Thomas Properties Group, Inc., a Maryland corporation (“TPGI”), TPG LP, and PKY Masters, LP, a Delaware limited partnership) have occurred (the “Merger Agreement”).

C.Parkway is a direct and indirect owner of the Operating Partnership and of TPG LP, and the Operating Partnership is the direct and indirect owner of TPG LP and of the Houston Property Owners (defined below). The Houston Property Owners own, as applicable, each of the Houston Properties (defined below).

D.As contemplated by that certain letter agreement dated September 4, 2013 addressed to Mr. James A. Thomas from Parkway and the Operating Partnership and acknowledged by Thomas, the Thomas Investors, and certain other persons (the “Thomas Letter Agreement”), the “BDN Transaction” (as defined in the Thomas Letter Agreement) and the requirements of such BDN Transaction set forth therein have been satisfied.

E.This Agreement is being entered into pursuant to Section 7 of the Thomas Letter Agreement in lieu of an amendment to the Original Tax Protection Agreement.

NOW, THEREFORE, the undersigned, in consideration of the premises, covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, hereby agree as follows:

1. Definitions.

Terms defined in the Preamble and Recitals, or elsewhere in this Agreement, have the meanings given to them therein, and the following terms have the meanings set forth below.

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“CityWest 1&2” means that certain project located at 2101 CityWest Boulevard in Houston, Texas commonly known as “CityWest Place 1&2.”

“CityWest 1&2 Owner” means TPG-2101 CityWest 1 & 2, L.P., a Delaware limited partnership.

“CityWest 3&4” means that certain project located at 2101 CityWest Boulevard in Houston, Texas commonly known as “CityWest Place 3&4.”

“CityWest 3&4 Owner” means TPG-2101 CityWest 3 & 4, L.P., a Delaware limited partnership.

“Guarantee Agreement” means an agreement between the Operating Partnership, or a Property Owner, the Thomas Investor and possibly a lender (or with a lender as a third party beneficiary), pursuant to which the Thomas Investor guarantees debt of the Operating Partnership or of such Property Owner, which guarantee may be on a “bottom dollar basis” provided it is on a paripassu basis with the other Thomas Investors, and which agreement shall be in the form of a guarantee or a contribution agreement.

“Guarantee Amount” means an amount specified by each Thomas Investor and which is set forth in the Guarantee Agreement for such Thomas Investor (not to exceed the amounts for each Thomas Investor set forth on Exhibit A), provided the aggregate Guarantee Amounts for the Thomas Investors shall not exceed Thirty-Nine Million Dollars ($39,000,000).

“Guaranteed Debt” means the debt which a Thomas Investor has guaranteed pursuant to a Guarantee Agreement.

“Guarantee Opportunity” has the meaning set forth in Section 3.1.

“Houston Properties” means CityWest 1&2, CityWest 3&4, and San Felipe Plaza.

“Houston Property Owner” means any of CityWest 1&2 Owner, CityWest 3&4 Owner, and San Felipe Plaza Owner.

“Property” means any of the Houston Properties and any other real property directly and/or indirectly owned by Parkway Properties, Inc. or the Operating Partnership.

“Property Owner” means the Houston Property Owners and any other owner of a Property which owner is owned directly and/or indirectly by Parkway Properties, Inc. or the Operating Partnership.

“Protected Period” means the period commencing on the date hereof and ending on October 13, 2016.

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“Qualifying Debt” means indebtedness of the Operating Partnership or a Property Owner that is described in (i), (ii) or (iii) below:

(i) In the case of indebtedness secured by any real property of the Operating Partnership or a Property Owner and which is not recourse to all of the assets of the Operating Partnership or the Property Owner, the aggregate amount of all indebtedness secured by such property must not exceed seventy-five percent (75%) of the fair market value (as determined by the Operating Partnership in its reasonable judgment) of such property at the time that the Guarantee Opportunity is first effective. Nonrecourse debt of a subsidiary of the Operating Partnership shall be treated as debt of the Operating Partnership, provided that the Operating Partnership guarantees (or enters into a contribution agreement with respect to) such debt and will permit the Thomas Investor to indemnify the Operating Partnership from certain losses associated with such guarantee (or contribution agreement) on terms which are similar to those set forth in the Thomas Investor’s Guarantee Agreement and reasonably acceptable to the Operating Partnership and the Thomas Investor;

(ii) In the case of indebtedness that is recourse to all of the assets of the Operating Partnership or a Property Owner, the indebtedness is at all times the most senior indebtedness recourse to all the assets of the Operating Partnership or such Property Owner (but there shall not be a prohibition against other indebtedness that is pari passu with such indebtedness) and the amount of the indebtedness outstanding is at all times at least equal to one hundred fifty percent (150%) of the aggregate amount of the guarantees provided with respect to such indebtedness; or

(iii) Any other indebtedness approved by Thomas (or his designee or legal representative) in his sole and absolute discretion.

In addition, debt which satisfies requirement (i) or (ii) above (but not requirement (iii) above) will not be Qualifying Debt if and when either of the following occurs: (a) there are other guarantees with respect to the same indebtedness that are prior to (i.e., with less economic risk) the Guarantee Opportunity provided to the Thomas Investor pursuant hereto; or (b) there are other guarantees with respect to the same indebtedness that are pari passu with the Guarantee Opportunity provided to the Thomas Investor pursuant hereto and the amount of all such guarantees (including the Thomas Investor’s obligation under its Guarantee Agreement) exceed seventy-five percent (75%) of the fair market value of the real estate which is security for such indebtedness measured at the time any such guarantee is first effective (as determined by the Operating Partnership in its reasonable judgment).

Notwithstanding the foregoing, there shall be no prohibition on guarantees of other portions of Qualifying Debt, and the above limitations shall not apply with respect to any guarantee of such debt by Parkway, provided that the Thomas Investor is offered the opportunity to enter into an agreement with Parkway providing that the Thomas Investor will indemnify Parkway from certain losses associated with such debt on terms which are similar to those set forth in the Thomas Investor’s Guarantee Agreement with respect to the debt of the Operating Partnership or one or more of the Property Owners.

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“San Felipe Plaza” means that certain project located at 5847 San Felipe, Houston, Texas commonly known as “San Felipe Plaza”.

“San Felipe PlazaOwner” means TPG-San Felipe Plaza, L.P., a Delaware limited partnership.

2. Replacement of Original Tax Protection Agreement.

This Agreement supersedes and replaces the Original Tax Protection Agreement, which shall be without any further force or effect (except for the limited purpose of certain terms and provisions being included herein by cross-reference to the Original Tax Protection Agreement).

3. Availability of Contribution Opportunities.

3.1    During the Protected Period, the Operating Partnership shall use commercially reasonable efforts to make available to the Thomas Investors the opportunity (a “Contribution Opportunity”) to make a guarantee of Qualifying Debt of the Operating Partnership or one or more Property Owners pursuant to a Guarantee Agreement an amount at least equal to the Guarantee Amount for such Thomas Investor; provided that if the Operating Partnership or one or more of the Property Owners, in the sole discretion of the Operating Partnership, has Qualifying Debt after the end of the Protected Period (without any obligation whatsoever on the part of the Operating Partnership or any Property Owner to maintain or have any such Qualifying Debt after the end of the Protected Period), then each Thomas Investor will continue to have the Guarantee Opportunity after the Protected Period to the extent of such Qualifying Debt. Each Thomas Investor may provide its Guarantee Agreement provided such agreement shall not expand such Thomas Investor’s rights hereunder and shall be subject to the reasonable comments and approval of the Operating Partnership. During the Protected Period, if Guaranteed Debt is to be repaid and, to the extent that immediately after such repayment, the outstanding amount of such Guaranteed Debt would be less than the Guarantee Amount with respect to such Guaranteed Debt, the Operating Partnership shall use commercially reasonable efforts to provide to each Thomas Investor a new Guarantee Opportunity with respect to Qualifying Debt in an amount equal to the Guaranteed Debt being repaid. In the event that the Partnership is required to use commercially reasonable efforts to offer a Guarantee Opportunity pursuant to this Section 3.1, the Operating Partnership will provide each Thomas Investor notice of the type, amount and other relevant attributes of the Qualifying Debt with respect to which the Guarantee Opportunity is offered at least ten (10) business days, to the extent reasonably practicable, but in no event less than five (5) business days prior to, the earlier of the closing of the incurrence of such debt and the scheduled repayment of the existing Guaranteed Debt. In the event that the Operating Partnership or a related party repurchases outstanding Guaranteed Debt, whether or not such debt is retired, the repurchase thereof shall be treated as a repayment of the Guaranteed Debt for purposes of this Section 3.

3.2    Each Thomas Investor acknowledges that each of the other Thomas Investors has the right to guarantee debt of the Operating Partnership on terms which are similar to the terms set forth in this Agreement. The Operating Partnership shall use commercially reasonable efforts to offer each Guarantee Opportunity to the Thomas Investors on a pro rata basis, based on the proportion of each Thomas Investor’s Guarantee Amount to the aggregate Guarantee Amounts of all Thomas Investors, unless the Thomas Investors agree to accept Guarantee Opportunities on other than a pro rata basis.

3.3    The Operating Partnership agrees to file its tax returns and to cause each such Property Owner to file its tax returns taking the position that the Guaranteed Debt is allocable to each Thomas Investor pursuant to its Guarantee Agreement with respect to such debt for purposes of Section 752 of the Internal Revenue Code of 1986, as amended (the “Code”), absent a determination to the contrary by the Internal

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Revenue Service or a change in applicable law with respect thereto. However, none of Parkway (including as successor to TPGI), the Operating Partnership, TPG LP, or any Property Owner makes any representation or warranty to a Thomas Investor that any Guarantee Agreement entered into pursuant to this Section 3 shall be respected for federal income tax purposes so as to enable such Thomas Investor to be considered to bear the “economic risk of loss” with respect to the indebtedness thereby for which such Thomas Investor is responsible under its Guarantee Agreement for purposes of either Section 752 or Section 465 of the Code.

3.4    The Operating Partnership shall not be obligated to undertake efforts to maintain any level of indebtedness in excess of the amounts specifically required to meet the obligations set forth above in this Section 3.

4.Other Agreements Regarding Tax Matters.

4.1    Each Thomas Investor acknowledges and agrees that none of Parkway, TPGI, the Operating Partnership, TPG LP, any Property Owner, Thomas or his or any of their heirs, estate or successors and assigns shall have any duty or obligation to any such Thomas Investor (and none of Parkway, the Operating Partnership, TPG LP, any Property Owner shall have any duty or obligation to Thomas) with respect to any decision made or action taken by any of the Thomas Investors under this Agreement, including, without limitation, accepting indebtedness as “Qualifying Debt,” or any other matter. Each of Thomas and the other Thomas Investors further acknowledges that it shall not have any claim against any of Parkway (including as successor to TPGI), the Operating Partnership, TPG LP, any Property Owner, (or, in the case of a Thomas Investor other than Thomas, Thomas), or his or any of their heirs, estate or successors and assigns for any adverse tax consequences suffered by such Thomas Investor as a result of any action taken by Thomas or any of his heirs, estate or other successors by operation of law under this Agreement.

4.2    The Thomas Investors acknowledge that none of Parkway (including as successor to TPGI), the Operating Partnership, TPG LP, and/or any Property Owner has made any representations, warranties or assurances concerning tax consequences of any kind, including of any Guarantee Agreement or this Agreement, and each of the Thomas Investors have consulted their own tax advisors and are not relying upon any representations, warranties or assurances of Parkway (including as successor to TPGI), the Operating Partnership, TPG LP, and/or any Property Owner in this regard.

4.2.1    The Thomas Investors shall indemnify and hold harmless Parkway, (including as successor to TPGI), the Operating Partnership, TPG LP, and the Property Owners from and against any “Losses” (as defined in Section 3.4 of the Contribution Agreement) arising out of or relating to, asserted against, imposed upon or incurred by any of them as a result of any Guarantee Agreement or other action or transaction contemplated by this Agreement, including without limitation such “Losses” arising as a result of any tax audit or other proceeding instituted by the Internal Revenue Service or any other tax authority.

4.2.2    The rights and remedies of Thomas for a breach or violation of the covenants set forth in Section 3 shall include a claim for damages incurred by him (including, without limitation, incidental and indirect damages, and direct and indirect adverse tax consequences, whether foreseeable or not, and including “Losses” as defined in Section 3.4 of the Contribution Agreement) against the Operating Partnership or any successor to the Operating Partnership. All such damages shall be subject to indemnification by the Operating Partnership pursuant to the provisions of Section 3.4 of the Contribution Agreement. Any claim, dispute, or controversy arising out of, or in connection with, or in relation to the interpretation, performance, or breach of this Agreement shall be subject to the provisions of Section 7.1 of the Contribution Agreement. The Operating Partnership shall have no liability to any other “Person” (as defined in the Contribution Agreement) besides Thomas under Section 3 and this Section 4.

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4.2.    The Operating Partnership acknowledges that any breach or violation by it of its obligations under this Agreement would cause substantial harm to Thomas, and the Operating Partnership agrees that any calculation of damages payable to Thomas based solely on the time value of money would not adequately compensate Thomas for the harm caused by any breach by the Operating Partnership of its obligations pursuant to Section 3 and any calculation of damages payable to Thomas shall be made without regard to the time value of money or the time period remaining in the Protected Period at the time of such breach or violation by the Operating Partnership. In addition, for purposes of determining any damages payable by the Operating Partnership or a successor to the Operating Partnership to Thomas pursuant to Section 3 and this Section 4, the tax effect on Thomas of any breach or violation of this Agreement by the Operating Partnership shall be considered.

4.2.4    Rights relating to any claim or dispute arising out of, or in connection with, or in relation to the interpretation of, performance, or breach of this Agreement shall be subject be governed by the provisions of the Original Tax Protection (including by reference to the Contribution Agreement).

4.3    The Thomas Investors and the Operating Partnership agree that allocations under Section 704(c) of the Code for properties of TPG LP treated as being contributed to the Operating Partnership pursuant to the “Partnership Merger” (as defined in the Merger Agreement) for periods after the date hereof shall be made utilizing the “traditional method without curative allocations,” as described in Treasury Regulation Section 1.704-3(b).

4.4    The Thomas Investors and TPG LP are parties to a “Contribution Agreement” (CITYWEST III & IV) dated as of December 19, 2013, entered into in connection with that loan in the principal amount of Ninety-Five Million Dollars ($95,000,000) (the “Loan”) pursuant to that certain Promissory Note and that certain Deed of Trust and Security Agreement dated as of October 7, 2010 by CityWest 3&4 Owner for the benefit of The Northwestern Mutual Life Insurance Company, a Wisconsin corporation (“Lender”), secured by, among other collateral, a first deed of trust lien on CityWest 3&4 (the “Existing Guarantee Agreement”). The obligations of TPG LP under the Existing Guarantee Agreement have been assigned to and assumed by the Operating Partnership concurrently herewith, and such assignment and assumption has been acknowledged and agreed to by Thomas and the Thomas Investors, pursuant to an Assignment and Assumption Agreement dated the date hereof. The Existing Guarantee Agreement provides, for the benefit of the Lender, that in the event of a default under the Loan, subject to the limitations and terms and conditions set forth in the Existing Guarantee Agreement, the Thomas Investors will contribute cash to the Operating Partnership to be used to repay any outstanding “Shortfall Amount” (as defined in the Existing Guarantee Agreement). During the Protected Period, so long as (i) the Operating Partnership directly or indirectly owns any of the Houston Properties, and (ii) one or more mortgage loans are secured by any of the Houston Properties, then the Operating Partnership shall use commercially reasonable efforts to make available to Thomas Investors a Guarantee Opportunity with respect to such mortgage loans, in an aggregate amount up to the aggregate of the Guaranty Amounts, as elected by the Thomas Investors in their discretion. The Thomas Investors will notify Parkway and the Operating Partnership of their election as to which of these mortgage loan(s) the Thomas Investors elect to provide such guarantees. Any Guarantee Agreement entered into pursuant to this Section 4.4 shall be deemed to be a guarantee of Qualifying Debt entered into accordance with Section 3 of this Agreement. If, for any reason, the mortgage loans on one or more Houston Properties are no longer available to the Thomas Investors to provide a guaranty up to the their respective Guarantee Amount, then the provisions of this Agreement shall govern with respect to the obligation of the Operating Partnership to provide Qualifying Debt for such purpose. The Thomas Investors agree and acknowledge that the Loan constitutes Qualifying Debt and Guaranteed Debt for purposes of this Agreement, and acknowledge that the Existing Guarantee Agreement, as assigned to and assumed by the Operating Partnership, currently satisfies the Operating Partnership’s obligations under Section 3 of this Agreement.

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5.     Miscellaneous.

5.1    This Agreement (and the legal relations between the parties hereto) shall be governed by and construed and enforced in accordance with the laws of the State of Delaware, without regard to its principles of conflicts of law.

5.2    This Agreement constitutes the entire agreement among the Operating Partnership, Thomas and the Thomas Investors pertaining to the subject matter hereof and supersedes all prior agreements, understandings, letters of intent, negotiations and discussions, whether oral or written, of the parties pertaining to the subject matter hereof, and there are no warranties, representations or other agreements, express or implied, made to any party by any other party pertaining to the subject matter hereof except as specifically set forth herein.

5.3    No amendment, supplement, modification, waiver or termination of this Agreement shall be binding unless executed in writing by the party to be bound thereby.

5.4    Any notice, request, claim, demand and other communications hereunder shall be in writing, shall be deemed to have been given (i) upon confirmation of successful transmission if sent by facsimile transmission or e-mail of a pdf attachment (provided that any notice received by facsimile or e-mail on any Business Day after 5:00 p.m. (Eastern time) shall be deemed to have been received at 9:00 a.m. (Eastern time) on the next Business Day), or (ii) upon receipt by the receiving party if sent by reliable overnight delivery service (with proof of service), hand delivery or certified or registered mail (return receipt requested and first-class postage prepaid), and shall be addressed as follows (or at such other address for a party as shall be specified in a notice given in accordance with this Section 5.4):

If to the Operating Partnership:

Parkway Properties LP

390 N. Orlando Avenue, Suite 2400

Orlando, Florida 32801

Phone: 407-650-0379

Fax: 407-650-0579

Attention: Jeremy Dorsett, Executive Vice President and General Counsel

E-Mail : jdorsett@pky.com

with a copy (which shall not constitute notice) to:

Hogan Lovells US LLP

555 13^th Street NW

Washington, DC 20004

Phone: 202-637-5600

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Fax: 202-637-5910

Attention: David Bonser, Esq.;

Bruce Gilchirst, Esq.

E-Mail : david.bonser@hoganlovells.com

bruce.gilchrist@hoganlovells.com

If to the Thomas Investors and/or Thomas:

James A. Thomas

230 N. Cliffwood

Los Angeles, California 90049

with a copy to:

Gilchrist & Rutter Professional Corporation

1299 Ocean Avenue, Suite 900

Santa Monica, California 90401

Attention: Jonathan S. Gross, Esq.

E-Mail: jgross@gilchristrutter.com

5.5    All of the rights, benefits, duties, obligations and liabilities of the parties shall inure to the benefit of, and be binding upon, their respective successors and permitted assigns. Except as specifically set forth herein, nothing herein expressed or implied is intended or shall be construed to confer upon or give to any person, other than the parties hereto and their successors and assigns, any rights or remedies under or by reason of this Agreement.

5.6    In the event that the date for the performance of any covenant or obligation under this Agreement shall fall on a Saturday, Sunday or legal holiday, the date for performance thereof shall be extended to the next business day.

5.7    Any provision or part of this Agreement which is invalid or unenforceable in any situation in any jurisdiction shall, as to such situation and such jurisdiction, be ineffective only to the extent of such invalidity and shall not affect the enforceability of the remaining provisions hereof or the validity or enforceability of any such provision in any other situation or in any other jurisdiction.

5.8    This Agreement may be executed in as many counterparts as may be deemed necessary and convenient, and by the different parties hereto on separate counterparts, each of which, when so executed, shall be deemed an original, but all such counterparts shall constitute one and the same instrument.

[signature pages follow]

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and year first above written.

PARKWAY PROPERTIES LP,

a Delaware limited partnership

By:PARKWAY PROPERTIES

GENERAL PARTNERS, INC.,

By:/s/ David O’Reilly

Name: David O’Reilly

Title: Executive Vice President, Chief Financial Officer and Chief Investment Officer

By:/s/ Jeremy R. Dorsett

Name: Jeremy R. Dorsett

Title: Executive Vice President, General Counsel and Secretary

/s/ James A. Thomas

James A. Thomas, Individually and in his capacity as the Trustee of the Lumbee Clan Trust

THOMAS INVESTORS:

THOMAS MASTER INVESTMENTS, LLC

By: THOMAS PARTNERS, INC.,

its Managing Member

/s/ James A. Thomas

By: James A. Thomas

Title: President

MAGUIRE THOMAS PARTNERS - PHILADELPHIA, LTD.

By: THOMAS PARTNERS, INC.,

its General Partner

/s/ James A. Thomas

By: James A. Thomas

Title: President

MAGUIRE THOMAS PARTNERS - COMMERCE SQUARE II, LTD.

By: THOMAS DEVELOPMENT PARTNERS-

PHASE II, INC.,

its General Partner

/s/ James A. Thomas

By: James A. Thomas

Title: President

Exhibit A (Guarantee Amounts)

Thomas Master Investments, LLC$4,828,200.00

Maguire/Thomas Partners-Philadelphia, Ltd.$17,085,900.00

Maguire Thomas Partners-Commerce Square, Ltd.$17,085,900.00

Exhibit B (Existing Guarantee Agreement)

[ATTACHED]

EX-99.1

EXHIBIT 99.1

FOR IMMEDIATE RELEASE

PARKWAY PROPERTIES, INC. AND THOMAS PROPERTIES GROUP,

INC. COMPLETE MERGER VALUED AT $1.2 BILLION

ORLANDO, FLORIDA - December 20, 2013 - Parkway Properties, Inc. (NYSE:PKY) (Parkway) today announced the completion of the merger with Thomas Properties Group, Inc. (NYSE: TPGI) (Thomas Properties) valued at approximately $1.2 billion. The transaction was approved by stockholders of each company at their respective stockholder meetings on December 17, 2013. The combined company will continue to trade under Parkway’s existing ticker symbol, PKY, on the New York Stock Exchange.

As a result of the merger, each former share of Thomas Properties common stock has been converted into 0.3822 of a newly issued share of Parkway common stock and each former share of Thomas Properties limited voting stock has been converted into 0.3822 of a newly issued share of Parkway limited voting stock. Former Thomas Properties stockholders hold approximately 25% of the combined company’s equity, with continuing Parkway stockholders holding approximately 75% of the combined company’s equity. Effective with the close of the market today, Thomas Properties’ shares of common stock will no longer be traded on the New York Stock Exchange.

James R. Heistand, President and Chief Executive Officer of Parkway, stated, We are thrilled to have completed this transaction as it represents a major step forward in Parkway’s long-term strategy to be the premier owner and operator of Class A office buildings in the Sunbelt. We are excited to add these ten high-class buildings to our portfolio, as they will strengthen our position in the Houston market and provide entry to the Austin market with scale. We are confident that we will be able to capitalize on the strong office fundamentals in these two markets and successfully implement our local market operational strategy to unlock additional value at the assets.

Parkway also announced that it completed the sale of Thomas Properties’ ownership interest in two office properties located in Philadelphia, Pennsylvania known as Commerce Square to Brandywine Realty Trust (NYSE:BDN) (Brandywine), based on a gross property value of approximately $331.8 million. Additionally, Parkway announced that it completed the sale of Thomas Properties’ Four Points Centre and a contiguous land parcel located in Austin, Texas to Brandywine for a gross sale price of approximately $47.3 million. Parkway received approximately $93.5 million in net proceeds from the sale of these assets.

James A. Thomas, the former Chairman, President and Chief Executive Officer of Thomas Properties, has joined Parkway’s board of directors and will serve as Chairman of the board. I am very pleased with the completion of this transaction which brings together these two entities and results in a strong company with an attractive portfolio in desirable markets, stated Mr. Thomas. Parkway’s current executive officers will continue as the executive officers of the combined company.

Advisors

BofA Merrill Lynch served as exclusive financial advisor to Parkway, and Hogan Lovells US LLP acted as its legal counsel. Morgan Stanley & Co. LLC served as exclusive financial advisor to Thomas Properties, and Skadden, Arps, Slate, Meagher & Flom LLP acted as its legal counsel.

About Parkway Properties

Parkway Properties, Inc. is a fully integrated, self-administered and self-managed real estate investment trust specializing in the acquisition, ownership and management of quality office properties in higher growth submarkets in the Sunbelt region of the United States. Parkway owns or has an interest in 43 office properties located in eight states with an aggregate of approximately 12.6 million square feet at October 1, 2013. Parkway also offers fee-based real estate services which manage and/or lease approximately 11.7 million square feet for third parties as of October 1, 2013. Additional information about Parkway is available on the company's website at www.pky.com.

Forward Looking Statement

Certain statements in this release that are not in the present or past tense or discuss Parkway's expectations (including the use of the words anticipate, believe, forecast, intends, expects, project, or similar expressions) are forward-looking statements within the meaning of the federal securities laws and as such are based upon Parkway's current belief as to the outcome and timing of future events. Examples of forward-looking statements include projected net operating income, cap rates, internal rates of return, future dividend payment rates, forecasts of FFO accretion, projected capital improvements, expected sources of financing, expectations as to the timing of closing of acquisitions, dispositions, or other transactions, and descriptions relating to these expectations. There can be no assurance that future developments affecting Parkway will be those anticipated by Parkway. These forward-looking statements involve risks and uncertainties (some of which are beyond the control of Parkway) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: changes in the real estate industry and in performance of the financial markets; the actual or perceived impact of U.S. monetary policy; the demand for and market acceptance of Parkway's properties for rental purposes; the ability of Parkway to enter into new leases or renewal leases on favorable terms; the amount and growth of Parkway's expenses; tenant financial difficulties and general economic conditions, including interest rates, as well as economic conditions in those areas where Parkway owns properties; risks associated with joint venture partners; the risks associated with the ownership and development of real property; the failure to acquire or sell properties as and when anticipated; termination of property management contracts; the bankruptcy or insolvency of companies for which Parkway provides property management services or the sale of these properties; the outcome of claims and litigation involving or affecting Parkway; the ability to satisfy conditions necessary to close pending transactions and the ability to successfully integrate pending transactions; risks associated with acquisitions, including the integration of Thomas Properties Group, Inc.'s businesses; risks associated with achieving expected synergies or cost savings; and other risks and uncertainties detailed from time to time in Parkway's Securities and Exchange Commission filings. Should one or more of these risks or uncertainties occur, or should underlying assumptions prove incorrect, Parkway's business, financial condition, liquidity, cash flows and results could differ materially from those expressed in the forward-looking statements. Any forward looking statements speaks only as of the date on which it is made. New risks and uncertainties arise over time, and it is not possible for us to predict the occurrence of those matters or the manner in which they may affect us. Parkway does not undertake to update forward-looking statements except as may be required by law.

Contact:

Ted McHugh

Director of Investor Relations

(407) 650-0593