<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 9, 1996
REGISTRATION NO. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------
PARKWAY PROPERTIES, INC.
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
MARYLAND 74-2123597
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
</TABLE>
300 ONE JACKSON PLACE
188 EAST CAPITOL STREET
JACKSON, MISSISSIPPI 39201-2195
(601) 948-4091
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
STEVEN G. ROGERS, PRESIDENT
300 ONE JACKSON PLACE
188 EAST CAPITOL STREET
JACKSON, MISSISSIPPI 39201-2195
(601) 948-4091
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------
Copies to:
JOSEPH P. KUBAREK, Esq.
Jaeckle, Fleischmann & Mugel
800 Fleet Bank Building
Twelve Fountain Plaza
Buffalo, New York 14202
(716) 856-0600
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement.
If the only securities being registered on this Form are being offered
pursuant to a dividend or interest reinvestment plan, please check the
following box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933 (the "Securities Act"), other than the securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
The registrant hereby amends this registration statement on such date or
dates as may be necessary to delay its effective date until the registrant
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
<PAGE> 2
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
====================================================================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
OFFERING AGGREGATE
AMOUNT TO BE PRICE OFFERING AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) REGISTRATION FEE
- -------------------------------------------------- ------------ ----------- --------- ----------------
<S> <C> <C> <C> <C>
Shares of common stock, $0.001 par value 1,140,000
per share . . . . . . . . . . . . . . . shares $19.125 $21,802,500 $7,518.11
====================================================================================================================================
<FN>
(1) Estimated solely for purposes of calculating the registration fee on the
basis of the average of the high and low sales prices as reported
on the New York Stock Exchange, Inc. of the shares of common stock, on
September 4, 1996, which was $19.125.
</TABLE>
<PAGE> 3
SUBJECT TO COMPLETION, DATED SEPTEMBER 9, 1996
PROSPECTUS
1,140,000 SHARES OF COMMON STOCK,
$0.001 PAR VALUE PER SHARE,
OF PARKWAY PROPERTIES, INC.
____________________________________________
The 1,140,000 shares of common stock, $0.001 par value per share
(the "Common Stock"), of Parkway Properties, Inc. ("Parkway"), to which this
Prospectus relates are offered for the stockholders identified in this
Prospectus under the heading "Selling Stockholders," or for the account of
pledgees, donees, transferees or other successors in interest of the Selling
Stockholders. Such sales may be made to or through one or more brokers or
dealers on the New York Stock Exchange at prices and at terms then prevailing
or at prices related to the then-current market price, or in negotiated
transactions. Such transactions may include, but are not limited to, one or
more of the following: (i) a block trade in which the broker or dealer so
engaged will attempt to sell the Common Stock as an agent, but may position and
resell a portion of the block as principal to facilitate the transaction; (ii)
purchases by a broker or dealer for its account pursuant to this Prospectus;
and (iii) ordinary brokerage transactions and transactions in which the broker
solicits purchasers. In effecting sales, brokers or dealers engaged by the
Selling Stockholders may arrange for other brokers or dealers to participate.
In the event of a transaction hereunder in which a broker or dealer acts as a
principal (other than to facilitate an installment sale transaction, or to a
market maker acting as such in routine transactions in the over-the-counter
market), this Prospectus will be supplemented to provide material facts with
respect to such transaction.
Brokers or dealers involved in sales hereunder will receive commissions
or discounts in amounts to be negotiated prior to the sale. Such brokers or
dealers and any other participating brokers or dealers may be deemed to be
"underwriters" within the meaning of the Securities Act of 1933, as amended
(the "Securities Act"), in connection with such sales, and any profits or
commissions earned by them in such transactions may be deemed to be
underwriting discounts or commissions under the Securities Act.
THE COMMON STOCK OFFERED HEREBY INVOLVES CERTAIN RISKS. SEE "RISK
FACTORS" BEGINNING ON PAGE 3.
Parkway will receive no portion of the proceeds of the sale of the
Common Stock hereunder. Parkway will incur the costs of preparation,
reproduction and distribution for this Registration Statement. The Selling
Stockholders will pay any brokerage discounts or commissions.
Sales of Common Stock may also be made for the account of the Selling
Stockholders or for the account of donees, transferees or other successors in
interest of the Selling
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<PAGE> 4
Stockholders pursuant to Rule 144 under the Securities Act. The securities
offered herein are "restricted securities" as defined by Rule 144 under the
Securities Act and investors of such securities are required by Rule 144 to
hold the restricted securities for a minimum of two years from the date of
purchase for full consideration. The Common Stock became listed on the New
York Stock Exchange, Inc. under the symbol "PKY" on August 22, 1996. On
September 6, 1996, the closing sale price was reported to be $19-3/8 per
share of Common Stock.
No dealer, salesman or other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus and, if given or made, such information or
representation must not be relied upon as having been authorized by Parkway.
This Prospectus does not constitute an offer to sell or a solicitation of any
offer to buy any of the securities offered hereby in any jurisdiction to any
person to whom it is unlawful to make such offer or solicitation in such
jurisdiction. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that the
information herein is correct as of any time subsequent to the date hereof or
that there has been no change in the affairs of Parkway since such date or, in
the case of information incorporated herein by reference, the date of filing
with the Securities and Exchange Commission.
_________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO
THE CONTRARY IS A CRIMINAL OFFENSE.
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THE SHARES OF COMMON STOCK HAS BEEN FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION. THESE SHARES OF COMMON STOCK MAY
NOT BE SOLD NOR MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE
REGISTRATION STATEMENT BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE
AN OFFER TO SELL OR THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY
SALE OF THESE SHARES OF COMMON STOCK IN ANY STATE IN WHICH SUCH OFFER,
SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION
UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
_________________________
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS
UNLAWFUL.
_________________________
The date of this Prospectus is _________________, 1996.
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<PAGE> 5
AVAILABLE INFORMATION
Parkway is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission (the "SEC"). Such reports, proxy statements
and other information filed by Parkway may be inspected at, and, upon payment
of the SEC's customary charges, copies obtained from, the Public Reference
Section of the SEC, 450 Fifth Street, N.W., Washington, DC 20549. Such
reports, proxy statements and other information are also available for
inspection and copying at prescribed rates at the SEC's regional offices in New
York, New York (Seven World Trade Center, 13th Floor, New York, New York 10048)
and in Chicago, Illinois (Suite 1400, Citicorp Center, 500 West Madison Street,
Chicago, Illinois 60661-2511). The SEC maintains a Web site
(http://www.sec.gov) that also contains reports, proxy statements and other
information concerning Parkway. In addition, the Common Stock is traded on the
New York Stock Exchange, Inc. under the symbol "PKY" and reports, proxy
statements and other information concerning Parkway can be inspected and
copied at the offices of the New York Stock Exchange, Inc., 20 Broad Street,
New York, New York 10005.
Parkway has filed with the SEC a Registration Statement on Form S-3
(the "Registration Statement") under the Securities Act and the rules and
regulations promulgated thereunder, with respect to the Common Stock. This
Prospectus constitutes the Prospectus of Parkway, filed as part of the
Registration Statement. As permitted by the rules and regulations of the SEC,
this Prospectus omits certain information contained in the Registration
Statement, and reference is made to the Registration Statement and the exhibits
listed therein, which can be inspected at the public reference facilities of
the SEC noted above, and copies of which can be obtained from the SEC at
prescribed rates as indicated above.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION OTHER THAN AS CONTAINED HEREIN IN CONNECTION WITH THE MATTERS
DESCRIBED HEREIN AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY PARKWAY. NEITHER THE DELIVERY
HEREOF NOR ANY DISTRIBUTION OF SECURITIES MADE HEREUNDER SHALL, UNDER ANY
CIRCUMSTANCES, CREATE AN IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE FACTS
HEREIN SET FORTH SINCE THE DATE HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN
OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY THE SECURITIES OFFERED BY
THIS PROSPECTUS IN ANY JURISDICTION WHERE, OR TO ANY PERSON TO WHOM, IT IS
UNLAWFUL TO MAKE SUCH AN OFFER OR SOLICITATION.
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<PAGE> 6
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Incorporated into this Prospectus by reference are the documents listed
below filed by Parkway or its predecessor, The Parkway Company, under the
Exchange Act. Copies of any such documents, other than exhibits to such
documents, are available without charge to each person to whom a copy of this
Prospectus has been delivered upon written or oral request of such person from
Parkway, 300 One Jackson Place, 188 East Capitol Street, Jackson, Mississippi
39201-2195, Attention: Chief Financial Officer, telephone number (601)
948-4091.
The following documents or portions thereof are hereby incorporated
into this Prospectus by reference:
1. The Parkway Company's Annual Report on Form 10-KSB for the
year ended December 31, 1995 (Commission File No. 0-12505).
2. The Parkway Company's Quarterly Report on Form 10-QSB for the
quarter ended March 31, 1996 (Commission File No. 0-12505).
3. The Parkway Company's Quarterly Report on Form 10-QSB for the
quarter ended June 30, 1996 (Commission File No. 0-12505), as
amended by Form 10-QSB/A dated August 30, 1996.
4. The Parkway Company's Current Report on Form 8-K/A dated March
1, 1996 (Commission File No. 0-12505).
5. The Parkway Company's Current Report on Form 8-K dated April
15, 1996 (Commission File No. 0-12505).
6. The Parkway Company's Current Report on Form 8-K dated May 31,
1996 (Commission File No. 0-12505).
7. The Parkway Company's Current Report on Form 8-K dated June
14, 1996 (Commission File No. 0-12505).
8. The Parkway Company's Proxy Material for its Annual Meeting of
Shareholders held on July 18, 1996 (Commission File
No. 0-12505).
9. The Parkway Company's Current Report on Form 8-K/A dated June
28, 1996 (Commission File No. 0-12505).
10. The Parkway Company's Current Report on Form 8-K dated July 9,
1996 (Commission File No. 0-12505).
11. Parkway Properties, Inc. Current Report on Form 8-K dated
August 2, 1996 (Commission File No. 0-12505).
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<PAGE> 7
12. Parkway Properties, Inc. Current Report on Form 8-K dated
August 9, 1996 (Commission File No. 1-11533).
13. Parkway Properties, Inc. Current Report on Form 8-K/A dated
August 30, 1996 (Commission File No. 1-11533).
All documents filed by Parkway pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering shall be deemed to be incorporated by reference
herein and to be a part hereof from the respective dates of the filing thereof.
Any statement contained in a document incorporated or deemed to be incorporated
by reference herein shall be deemed to be modified or superseded for purposes
of this Prospectus to the extent that a statement contained herein, or in any
other subsequently filed document that also is or is deemed to be incorporated
by reference herein, modifies or supersedes such statement. Any such statement
so modified or superseded shall not be deemed, except as so modified or
superseded, to constitute a part of this Prospectus.
v
<PAGE> 8
TABLE OF CONTENTS
-----------------
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE COMPANY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Operating Strategy . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Possible Election of REIT Status . . . . . . . . . . . . . . . . . . . 2
RISK FACTORS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Risks Associated with Indebtedness . . . . . . . . . . . . . . . . . . 3
Risks of Real Estate Ownership . . . . . . . . . . . . . . . . . . . . 3
Tax Risks Associated with Potential REIT Election . . . . . . . . . . 4
Limitation on Net Operating Loss Carryforwards . . . . . . . . . . . . 5
Tenant Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
Americans with Disabilities Act . . . . . . . . . . . . . . . . . . . 6
Risk of Catastrophic Loss . . . . . . . . . . . . . . . . . . . . . . 6
Possible Environmental Liabilities . . . . . . . . . . . . . . . . . . 7
Competition . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
Risk of Acquisitions . . . . . . . . . . . . . . . . . . . . . . . . . 8
Possible Ownership Restrictions . . . . . . . . . . . . . . . . . . . 8
SELLING STOCKHOLDERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
USE OF PROCEEDS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
PLAN OF DISTRIBUTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
DESCRIPTION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
LEGAL MATTERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
EXPERTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
INDEMNIFICATION OF DIRECTORS AND OFFICERS . . . . . . . . . . . . . . . . . . . 13
</TABLE>
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<PAGE> 9
THE COMPANY
ORGANIZATION
Parkway Properties, Inc. ("Parkway") was incorporated under the laws
of the State of Maryland on May 17, 1996. Formed as a wholly-owned subsidiary
of The Parkway Company, a Texas corporation, Parkway merged with The Parkway
Company on August 2, 1996 (the "Merger") pursuant to the Agreement and Plan of
Merger dated July 17, 1996 by and between Parkway and The Parkway Company. As
a result of the Merger, Parkway succeeded to the business and operations of The
Parkway Company. This reincorporation in Maryland allows Parkway to avail
itself of the benefits of the Maryland General Corporation Law, something
management of Parkway believes to be beneficial should Parkway elect to be
taxed as a real estate investment trust ("REIT") under the Internal Revenue
Code of 1986, as amended (the "Code"). See "--Possible Election of REIT
Status."
Additionally, on August 22, 1996 shares of common stock, par value
$0.001 per share of Parkway ("Common Stock") became listed on the New York
Stock Exchange, Inc. ("NYSE") under the symbol "PKY." Prior to this date, the
Common Stock had been listed on the NASDAQ National Market under the symbol
"PKWY."
OPERATING STRATEGY
Parkway is a full service, self-managed real estate investment company
specializing primarily in the ownership, management and leasing of office
properties in the southeast and southwest United States. Parkway seeks
investments where the expertise of Parkway's management can add value through
direct asset and/or property management, a "hands-on" operating philosophy and
Parkway's liquidity and financial strength. Parkway owns a portfolio of income
producing real estate properties. At August 31, 1996, Parkway owned or had an
interest in 15 office buildings in seven states with an aggregate of 1,640,000
square feet of leasable space. Parkway's office building investments are
located primarily in four southern locations: Houston, Texas; Atlanta,
Georgia; Jackson, Mississippi and Fairfax County, Virginia.
Through its wholly-owned subsidiary, Eastover Realty Corporation
("Eastover Realty"), Parkway is also involved in the management of commercial
properties for which it receives management fees. Eastover Realty currently
manages and leases a portfolio of approximately 1,560,000 square feet of office
and industrial space. Eastover Realty also performs brokerage services to
third parties on a commission basis. Eastover Realty manages Parkway's office
buildings in Jackson, Mississippi.
In addition to direct real estate acquisitions, Parkway's investment
strategy has also historically included the consummation of business
combination transactions with other public
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<PAGE> 10
real estate and financial companies which Parkway deemed to be undervalued.
Since 1979, Parkway has completed eight such business combinations. Most
recently, Parkway acquired First Continental Real Estate Investment Trust
effective May 10, 1994, Congress Street Properties, Inc. effective November 29,
1994 and EB, Inc. effective April 27, 1995. As a result of these various
business combinations, Parkway has acquired a portfolio of non-core real estate
assets, securities and mortgage loans, which it is proceeding to liquidate.
POSSIBLE ELECTION OF REIT STATUS
Parkway presently pays virtually no federal income taxes ($64,000 in
1995) because net operating losses ("NOLs") shelter most of Parkway's income
from such taxes. However, the increase in the number of outstanding shares of
Common Stock which resulted from the completion of the private placement of
shares of Common Stock in June 1996 (the "Private Placement") and Parkway's
recent mergers caused the use of Parkway's NOLs to be significantly limited in
any one year. Accordingly, subject to further analysis, Parkway intends to
elect to qualify as a REIT for the taxable year beginning January 1, 1997,
which will allow Parkway to be generally exempt from federal income taxes even
if its NOLs are limited or exhausted providing it makes sufficient
distributions to its stockholders. Parkway and its advisors are presently
examining Parkway's assets, sources of revenue and operating history to
determine if Parkway will be eligible to be taxed as a REIT and the steps that
need to be taken for Parkway to qualify as a REIT under the Code. However, the
examination is ongoing and there can be no assurance whether a REIT election
can or will be made. See "Risk Factors--Tax Risks Associated with Potential
REIT Election."
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<PAGE> 11
RISK FACTORS
An investment in the Common Stock involves various risks. Prospective
investors should carefully consider the following information in conjunction
with the other information contained or incorporated by reference in this
Prospectus before making a decision to purchase any Common Stock.
RISKS ASSOCIATED WITH INDEBTEDNESS
Although Parkway intends to maintain what it believes to be acceptable
leverage, there are no formal limits on the amount of indebtedness that Parkway
may incur. Furthermore, certain of Parkway's indebtedness have variable
interest rates which may rise if the level of interest rates in general
increases. Parkway intends to repay amounts drawn under its line of credit
with Deposit Guaranty National Bank which can be used only to purchase income
producing real property (the "Acquisition Line of Credit"), with funds obtained
from fixed rate financing secured by the buildings purchased with the
Acquisition Line of Credit or with cash available from operations and proceeds
from the sale of non-core assets. There can be no assurance that such fixed
rate financing will be available or available on acceptable terms, or that
non-core assets will be sold to purchase office properties or repay debt, and
in the event variable rate debt remains outstanding, any increase in interest
rates could have a material adverse impact on Parkway's financial results.
RISKS OF REAL ESTATE OWNERSHIP
Parkway's assets primarily consist of equity investments in various
types of real property. As a result, stockholders of Parkway are subject to
the risks inherent in the ownership and management of real property owned by
Parkway. These risks include, among others: adverse changes in general or
local economic conditions; adverse changes in interest rates and in the
availability of permanent mortgage financing which may render the acquisition,
sale or refinancing of properties difficult or unattractive; existing law,
rules and regulations and judicial decisions regarding liability for a variety
of potential problems related to real estate generally; adverse changes in real
estate, zoning, environmental or land-use laws; increases in real property
taxes and federal or local economic or rent controls; other governmental rules;
increases in operating costs and the need for additional capital and tenant
improvements; the cash demands of tenant improvements and leasing commission
obligations; the supply of and demand for properties; possible insolvencies and
other material defaults by tenants; overbuilding in certain markets; ability to
obtain or maintain full occupancy of properties or to provide for adequate
maintenance or insurance; the presence of hazardous waste materials; mechanics
liens resulting from construction; property related claims and litigation;
fiscal policies; and acts of God. The illiquidity of real estate investments
generally impairs the ability of real estate owners to respond quickly to
changed circumstances.
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<PAGE> 12
Additionally, a substantial percentage of Parkway's properties are
located in the southeast and southwest United States (particularly the states
of Mississippi, Georgia, Texas and Virginia) and such properties consist
predominantly of office properties. Parkway's performance, therefore, will be
linked to economic conditions in the southeast and southwest United States as
well as the market for office space generally. To the extent that these
conditions impact the market rents for office space, they could result in a
reduction of net income, funds from operations and cash available for
distribution and thus affect the financial performance of Parkway.
Certain significant expenditures associated with investments in real
estate (such as mortgage payments, real estate taxes, insurance and maintenance
costs and the cash demands of tenant improvements and leasing commission
obligations) are generally not reduced when circumstances cause a reduction in
rental revenues from the property. In addition, real estate values and yields
from investments in properties may also be affected by such factors as
conditions in financial markets, environmental conditions and compliance with
laws. If large numbers of vacancies occur in Parkway's office properties,
Parkway may be required to make significant expenditures for marketing, tenant
improvements and leasing commissions in connection with attracting new tenants
for such vacant space. Any of these factors may adversely affect Parkway's net
income, funds from operations and cash available for distribution.
TAX RISKS ASSOCIATED WITH POTENTIAL REIT ELECTION
Subject to its eligibility to do so, Parkway intends to elect to
qualify as a REIT under the Code in order to qualify for the tax benefits of
such a classification. No assurance can be given that Parkway will be eligible
to make such election, and, if it does, that all benefits potentially arising
from such an election will be realized. Among the risk factors to be
considered in this context are the following:
Earnings and Profits Calculation. In order to elect REIT status,
Parkway cannot have earnings and profits which have been generated during years
in which Parkway was not qualified as a REIT. For this purpose, under the
Code, earnings and profits of companies which have been acquired by Parkway and
the earnings and profits of any of Parkway's subsidiaries are included in
calculating Parkway's earnings and profits account. The determination of the
earnings and profits account of a company is a highly technical and complex
undertaking. Parkway's predecessor, The Parkway Company, was organized in 1971
and over the years has acquired several companies. In calculating the earnings
and profits account, studies must be done of not only Parkway's earnings and
profits history, but also the history of all acquired companies. No assurance
can be given that sufficient records exist to fully determine this issue, and
even if an accurate determination of Parkway's earnings and profits account is
achieved, to the extent such account is positive, Parkway will be required to
distribute dividends sufficient to reduce that account to zero prior to the
effective date of Parkway's election of REIT status under the Code. Finally,
any determination made by Parkway with respect to its earnings and profits
account is not binding on the Internal Revenue Service (the "Service"). In the
event the
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<PAGE> 13
Service were to successfully challenge Parkway's calculation of earnings and
profits, a possible outcome of such challenge could be the termination of
Parkway's status as a REIT in the event of its future election to be qualified
as a REIT.
Proposed Legislation. The Clinton Administration has proposed certain
changes to the treatment of corporations electing to be taxed as S corporations
which may have a collateral effect on the possible future election of Parkway
to be qualified as a REIT. Under the proposed legislation, corporations having
a value in excess of $5,000,000 and electing S corporation status would be
taxed as if they had sold all their assets at fair market value and distributed
the assets to their stockholders, who in turn would be treated as contributing
the assets to a new corporation. This would trigger a tax at both the corporate
level, on the deemed sale of the assets, and at the stockholder level, on the
deemed distribution of the proceeds from the sale. The Treasury Department has
unofficially indicated that it would apply this rule to corporations electing
to become REITs. Although Parkway does not believe that it would incur any
additional tax liability on the deemed sale of its assets, a significant tax
might be generated at the stockholder level on the deemed distribution of the
proceeds of such sale. The ultimate fate of the Clinton Administration's
proposal at this point is unknown. Additionally, as currently proposed,
Parkway could avoid application of the new rules if it makes the election to be
effective as a REIT prior to January 2, 1997.
Possible Restructuring. In order to qualify as a REIT, Parkway must
restructure both the manner in which it owns certain of its assets and its
active business operations. Because no assurance can be given that REIT status
will be obtained, it is possible that the substantial costs incurred and the
operating structures adopted in anticipation of such election will not result
in the benefits intended.
LIMITATION ON NET OPERATING LOSS CARRYFORWARDS
For federal income tax purposes, Parkway has approximately $9,688,000
of NOLs as of June 30, 1996. In addition to the NOLs, two of Parkway's
subsidiaries have NOLs of approximately $23,500,000 in the aggregate. Parkway
estimates that approximately $10,440,000 of these NOLs will be available, on a
limited basis, for use by Parkway after application of certain restrictions
under the Code. As a consequence of the issuances of shares in business
combination transactions and for cash, the ability of Parkway to apply NOLs to
offset its taxable income is significantly limited. As a result of the Private
Placement, Parkway may be required to pay federal income tax on a portion of
its income unless it is able to elect to qualify as a REIT, in which case the
rules relating to taxation of REITs would apply.
5
<PAGE> 14
TENANT DEFAULTS
A substantial part of Parkway's income is expected to be derived from
rental income from real property. Consequently, Parkway's ability to make
expected distributions to stockholders would be adversely affected if a
significant number of tenants failed to meet their lease obligations. In the
event of a default by a tenant, Parkway may experience delays in enforcing its
rights as lessor and may incur substantial costs in protecting its investment.
At any time, a tenant may also seek protection under the bankruptcy laws, which
could result in the rejection and termination of such tenant's lease and
thereby cause a reduction in the net income, funds from operations and cash
available for distribution of Parkway. If a tenant rejects its lease pursuant
to applicable bankruptcy laws, Parkway's claim for breach of the lease in
excess of any applicable security deposit would (absent collateral securing the
claim) be treated as a general unsecured claim. The amount of the claim would
be capped at the amount owed for unpaid pre-petition lease payments unrelated
to the rejection, plus the greater of one year's lease payment or 15% of the
remaining lease payments payable under the lease (but not to exceed the amount
of three years' lease payments).
AMERICANS WITH DISABILITIES ACT
Under the Americans with Disabilities Act of 1990, as amended (the
"ADA"), all public accommodations are required to meet certain federal
requirements related to access and use by disabled persons. Compliance with
the public accommodations provision of the ADA could require the removal of
access barriers, and noncompliance could result in the imposition of fines or
awards of damages. Additional legislation may impose further burdens or
restrictions on owners with respect to access by disabled persons. The
ultimate amount of the cost of compliance with the ADA or such legislation is
not currently ascertainable, and, while such costs are not expected to have a
material effect on Parkway, such costs could be substantial. Parkway has not
undertaken ADA studies of all of its properties and, as to those properties with
respect to which Parkway has not undertaken ADA studies, possible costs of
compliance could arise.
RISK OF CATASTROPHIC LOSS
Parkway has obtained or has caused its tenants to obtain, commercial
general liability, fire and extended coverage insurance with respect to its
properties, of the types and in the amounts which management believes are
customarily obtained for similar properties. There are, however, certain types
of losses (generally of a catastrophic nature, such as earthquakes, floods and
wars) that may be either uninsurable or not economically insurable. Should
such an uninsured loss occur, Parkway could lose both its invested capital and
anticipated profits relating to such property.
6
<PAGE> 15
POSSIBLE ENVIRONMENTAL LIABILITIES
Under various federal, state and local laws, ordinances and
regulations, an owner of real estate is liable for the costs of removal or
remediation of certain hazardous or toxic substances on or in such property.
Such laws often impose liability without regard to whether the owner knew
of, or was responsible for, the presence of such hazardous or toxic substances.
The presence of such substances, or the failure to properly remediate such
substances, may adversely affect the owner's ability to sell or rent such
property or to use such property as collateral in its borrowings. Management
of Parkway is not aware of any environmental liability with respect to the
properties that management believes would have a material adverse effect on
Parkway's business, assets or results of operations. Phase I environmental
audits have been conducted at each of the properties acquired by Parkway since
June 1, 1995 and Parkway will perform such audits with respect to properties
acquired in the future. No assurance can be given that there are no existing
environmental liabilities with respect to any of Parkway's properties or that
any prior owner of any such property did not create any material environmental
condition not known to Parkway.
Asbestos was formerly used in commercial construction as a
fireproofing and insulation material. Under certain circumstances, asbestos
can become a hazard to the health of the occupants of buildings and it must be
regularly monitored to ensure that it has not become a health hazard. Parkway
is not aware of any material asbestos problems at the properties owned by
Parkway, but is aware of asbestos at certain properties which secure mortgage
loans owned by Parkway. The fact that asbestos is present in properties which
are collateral for Parkway's loans could have an adverse effect on the value of
Parkway's collateral. Further, there can be no assurance that asbestos
problems do not exist at properties owned by Parkway. If there is asbestos in
Parkway's properties (or in a property upon which Parkway forecloses) that
requires removal or other remediation, the costs thereof could be substantial.
COMPETITION
All of the properties owned by Parkway are located in developed areas.
There are numerous other office properties and real estate companies within the
market area of each such property which will compete with Parkway for tenants
and development and acquisition opportunities. The number of competitive
office properties and real estate companies in such areas could have a material
effect on (i) Parkway's ability to rent space at the properties, the amount of
rents currently charged and tenant improvements and other tenant concessions
required to lease the property; and (ii) development and acquisition
opportunities. Parkway will compete for tenants and acquisitions with others
who may have greater resources than Parkway. Furthermore, Parkway has more
than one office building in certain markets (e.g., Jackson, Mississippi) and
those buildings may compete against one another for the same tenants.
7
<PAGE> 16
RISK OF ACQUISITIONS
Parkway has acquired 10 office properties since July 31, 1995 and is
in the process of acquiring additional properties. Although Parkway believes
it has sufficient management depth to take Parkway through this period of asset
growth, there can be no assurance that Parkway will be able to assimilate the
acquisitions into its portfolio without certain operating disruptions and
unanticipated costs.
POSSIBLE OWNERSHIP RESTRICTIONS
The provisions of the Charter of Parkway (the "Charter") provide that
if a transfer of stock of Parkway or a change in the capital structure of
Parkway would result in (i) any person (as defined in the Charter) directly or
indirectly acquiring beneficial ownership of more than 9.8% of the equity
securities of Parkway; (ii) the outstanding Common Stock and preferred stock of
Parkway being constructively or beneficially owned by fewer than 100 persons;
or (iii) Parkway being "closely held" within the meaning of Section 856 of the
Code, then: (A) any proposed transfer will be void ab initio and will not be
recognized by Parkway; (B) Parkway will have the right to redeem the shares
proposed to be transferred; and (C) the shares proposed to be transferred will
be automatically converted into and exchanged for shares of a separate class of
stock, the excess stock, having no dividend or voting rights. Holders of
excess stock do have certain rights in the event of any liquidation,
dissolution or winding up of the corporation. The Charter further provides that
the excess stock will be held by Parkway as trustee for the person or persons
to whom the shares are ultimately transferred, until such time as the shares
are retransferred to a person or persons in whose hands the shares would not be
excess stock and certain price-related restrictions are satisfied. These
provisions are designed to enable Parkway to meet the share ownership
requirements applicable to REITs under the Code, but may also have an
anti-takeover effect.
8
<PAGE> 17
SELLING STOCKHOLDERS
All of the Common Stock offered hereby is to be offered for the
account of the security holders (the "Selling Stockholders") set forth in the
table below. Each of the Selling Stockholders acquired its securities from the
Company in transactions that were exempt from the registration requirements of
the Securities Act of 1933, as amended.
<TABLE>
<CAPTION>
Shares of Shares of
Common Stock Shares of Common Stock
Owned Prior Common Stock Owned After
Selling Stockholders (1) to the Offering Offered for Sale the Offering
------------------------ --------------- ---------------- ------------
<S> <C> <C> <C>
Morgan Stanley U.S. Real Estate (Retail) . . . . 14,000 14,000 0
MS SICAV REAL ESTATE (2) . . . . . . . . . . . . 253,000 253,000 0
Morgan Stanley Institutional Fund
Real Estate Portfolio (3) . . . . . . . . . . . 323,000 323,000 0
Delaware Dividend & Income Fund . . . . . . . . . 120,500 120,500 0
Delaware Pooled Trust - Real Estate
Investment Fund . . . . . . . . . . . . . . . . 29,500 29,500 0
Charter Oak Partners . . . . . . . . . . . . . . 200,000 200,000 0
Pennsylvania Public School
Employees' Retirement System . . . . . . . . . 200,000 200,000 0
<FN>
- ----------------------
(1) None of the Selling Stockholders had any material relationship with
Parkway, its predecessor or any affiliates of Parkway, within the past
three years.
(2) MS SICAV REAL ESTATE currently owns 253,000 shares of Class A
preferred stock, $0.001 par value per share, of Parkway (the "Class A
Preferred Stock"). Subject to stockholder approval, MS SICAV REAL
ESTATE has the right to exchange, on a share-for-share basis, its
shares of Class A Preferred Stock for shares of Common Stock. To the
extent such exchange occurs, such shares of Common Stock are
registered hereunder.
(3) Morgan Stanley Institutional Fund Real Estate Portfolio currently owns
323,000 shares of Class A Preferred Stock. Subject to stockholder
approval, Morgan Stanley Institutional Fund Real Estate Portfolio has
the right to exchange, on a share-for-share basis, its shares of Class
A Preferred Stock for Common Stock. To the extent such exchange
occurs, such shares of Common Stock are registered hereunder.
</TABLE>
9
<PAGE> 18
USE OF PROCEEDS
Parkway will not receive any proceeds from this offering of Common
Stock by the Selling Stockholders.
PLAN OF DISTRIBUTION
Parkway has been advised by the Selling Stockholders that the Selling
Stockholders may sell all or a portion of the securities offered by it hereby
from time to time on the NYSE at prices prevailing at the time of such sales.
The Selling Stockholders may also make private sales directly to or through a
broker or brokers. Alternatively, the Selling Stockholders may from time to
time offer the securities through underwriters, dealers or agents, who may
receive compensation in the form of underwriting discounts, commissions or
concessions from the Selling Stockholders and/or the purchasers of the
securities for whom they may act as agent. To the extent required, the number
of securities to be sold, the purchase price, the name of any such agent,
dealer or underwriter and any applicable commissions with respect to a
particular offer will be set forth in an accompanying Prospectus Supplement.
The aggregate net proceeds to the Selling Stockholders from the sale of the
securities sold by the Selling Stockholders hereby will be the purchase price
of such securities less any broker's commissions.
No determination has been made whether the Selling Stockholders will
sell any of the securities offered hereby.
In order to comply with the securities laws of certain states, if
applicable, the securities will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, the securities may not
be sold in certain states unless they have been registered or qualified for
sale in the applicable state or an exemption from the registration or
qualification requirement is available and complied with.
The Selling Stockholders and any broker-dealers, agents or
underwriters that participate with the Selling Stockholders in the distribution
of the securities may be deemed to be "underwriters" within the meaning of the
Securities Act, in which event any commissions received by such broker-dealers,
agents or underwriters and any profit on the resale of the securities purchased
by them may be deemed to be underwriting commissions or discounts under the
Securities Act.
10
<PAGE> 19
DESCRIPTION OF SECURITIES
The total number of shares of capital stock of all classes that
Parkway is authorized to issue is 100,000,000. The capital stock is currently
classified as (i) 69,424,000 shares of Common Stock; (ii) 576,000 shares of
Class A Preferred Stock; and (iii) 30,000,000 shares of excess stock, par value
$0.001 per share. The Board of Directors of Parkway is authorized by the
Charter to classify or reclassify any unissued shares of the capital stock of
Parkway, by setting, altering or eliminating the designation, preferences,
conversion or other rights, voting powers, qualifications and terms and
conditions of redemption of, limitations as to dividends and any other
restrictions on, such capital stock. The power of the Board of Directors to
classify and reclassify any of the shares of capital stock includes the
authority to classify or reclassify such shares into a class of preferred
stock.
Pursuant to the provisions of the Charter, if a transfer of stock
occurs whereby any person would own, beneficially or constructively, in
excess of 9.8 percent of the outstanding capital stock of Parkway (excluding
shares of excess stock), then such amount in excess of the 9.8 percent limit
shall automatically be converted into shares of excess stock and any such
transfer will be void ab initio. However, such restrictions will not prevent
the settlement of a transaction entered into through the facilities of any
interdealer quotation system or national securities exchange upon which shares
of capital stock of Parkway are traded, provided that certain transactions may
be settled by providing shares of excess stock.
The holders of shares of Common Stock are entitled to one vote per
share on all matters to be voted upon by the stockholders. The holders of
shares of Common Stock have no cumulative voting rights. Additionally, subject
to the rights of holders of preferred stock, holders of shares of Common Stock
are entitled to receive such dividends as may be declared from time to time by
the directors out of funds legally available therefor. The holders of shares
of excess stock have no voting rights or dividend rights and shares of excess
stock are not transferrable.
The holders of Class A Preferred Stock have no voting rights and,
except as provided above, such shares are not convertible. Dividends on
shares of Class A Preferred Stock will be declared and paid simultaneously with
any dividends payable on the Common Stock and, for all dividends paid and
declared on or before December 31, 1996, such dividend will be paid at a per
share dividend rate of the greater of (i) twenty-four cents ($0.24) per share
per quarter or (ii) the per share dividend declared and paid on Common Stock
for the same quarter, as adjusted for stock dividends, stock splits or similar
capital changes. For all dividends paid and declared on Class A Preferred
Stock after December 31, 1996, such dividends will be paid at a per share
dividend rate of the greater of (i) thirty-eight cents ($0.38) per share per
quarter or (ii) the per share dividend declared and paid on Common Stock for
the same quarter, as adjusted for stock dividends, stock splits or similar
capital changes. No dividend will be paid or declared, nor any distribution
made on any other class of stock (other than a dividend payable in stock of the
same class) nor will any shares of Common Stock be acquired for consideration
by Parkway unless
11
<PAGE> 20
all accrued dividends on the Class A Preferred Stock for all past dividend
periods have been paid.
In the event of the voluntary or involuntary liquidation, dissolution
or winding up of Parkway, each holder of Class A Preferred Stock will be
entitled to receive out of Parkway's assets, before any distribution or payment
shall be made to the holders of any other class of stock, an amount equal to
$15.25 per share of Class A Preferred Stock plus any accrued dividends not
paid, without interest. If the amounts payable on liquidation, dissolution or
winding up in respect to the shares of Class A Preferred Stock are not paid in
full, the shares of such class will share ratably in any distribution of assets
in accordance with the sums which would be payable in such distribution if all
sums payable were discharged in full. If such payment has been made in full to
the holders of all shares of Class A Preferred Stock on voluntary or
involuntary liquidation, dissolution or winding up, the remaining assets of
Parkway shall be distributed among the holders of preferred stock and the
remaining stock of Parkway in accordance with their respective rights.
LEGAL MATTERS
The legality of the issuance of the Common Stock offered hereby has
been passed upon for Parkway by Jaeckle, Fleischmann & Mugel, Buffalo, New
York.
EXPERTS
The consolidated financial statements of The Parkway Company (Parkway
Properties, Inc.'s predecessor) included in The Parkway Company's Annual Report
on Form 10-KSB for the year ended December 31, 1995, have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report thereon
and included therein and incorporated by reference herein. Such financial
statements are incorporated herein by reference in reliance on such reports
given upon the authority of such firm as experts in accounting and auditing.
12
<PAGE> 21
INDEMNIFICATION OF DIRECTORS AND OFFICERS
Parkway's Charter contains a provision authorizing Parkway to
indemnify, to the fullest extent permitted by Maryland law, its directors and
officers, whether serving Parkway or, at its request, any other entity.
Additionally, the Charter provides that to the fullest extent permitted by
Maryland law, no director or officer shall be liable to Parkway or its
stockholders for money damages.
Section 2-418 of the Maryland General Corporation Law (the
"Indemnification Statute"), the law of the state in which Parkway is organized,
empowers a company, subject to certain limitations, to indemnify its officers
and directors against expenses, including attorneys' fees, judgments,
penalties, fines, settlements and expenses, actually and reasonably incurred by
them in any suit or proceeding to which they are parties unless the act or
omission of the director was material to the matter giving rise to the
proceeding and was committed in bad faith, or was the result of active and
deliberate dishonesty, or the director received an improper personal benefit
or, with respect to a criminal action or proceeding, the director had no
reasonable cause to believe their conduct was unlawful.
Parkway has entered into an indemnification agreement (the
"Indemnification Agreement") with each of its directors and officers and the
Board of Directors has authorized Parkway to enter into an Indemnification
Agreement with each of the future directors and officers of Parkway. The
Indemnification Statute permits a corporation to indemnify its directors and
officers. However, the protection that is specifically afforded by the
Indemnification Statute authorizes other arrangements for indemnification of
directors and officers, including insurance. The Indemnification Agreement is
intended to provide indemnification to the maximum extent allowable by, or not
in violation of, or offensive to, any law of the State of Maryland.
The Indemnification Agreement provides that Parkway shall indemnify a
director or officer who is a party to the agreement (the "Indemnitee") if he or
she was or is a party to or otherwise involved in any proceeding by reason of
the fact that he or she was or is a director or officer of Parkway, or was or
is serving at its request in a certain capacity of another entity, against
losses incurred in connection with the defense or settlement of such
proceeding. This indemnification shall be provided to the fullest extent
permitted by the Indemnification Agreement. This is similar to the
indemnification provided by the Indemnification Statute except that
indemnification is not available under the Indemnification Agreement to the
Indemnitee who pays any amount in settlement of a proceeding without Parkway's
written consent.
13
<PAGE> 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
-------------------------------------------
The following expenses, other than the Securities and Exchange
Commission registration fee and the New York Stock Exchange listing fee, are
estimated. All expenses of the offering listed below will be paid by Parkway.
<TABLE>
<S> <C>
Securities and Exchange Commission registration fee . . . . . . . . . . . . . $ 7,518
Blue Sky fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . 3,000
New York Stock Exchange listing fee . . . . . . . . . . . . . . . . . . . . . *
Printing and engraving expenses . . . . . . . . . . . . . . . . . . . . . . . 15,000
Legal fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,000
Accounting fees and expenses . . . . . . . . . . . . . . . . . . . . . . . . . *
Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . *
-------
TOTAL
$ *
<FN>
- ---------------------------------
* To be completed by amendment
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
-----------------------------------------
Parkway's Charter contains a provision authorizing Parkway to
indemnify, to the fullest extent permitted by Maryland law, its
directors and officers, whether serving Parkway or, at its request,
any other entity. Additionally, the Charter provides that to the
fullest extent permitted by Maryland law, no director or officer shall
be liable to Parkway or its stockholders for money damages.
Section 2-418 of the Maryland General Corporation Law (the
"Indemnification Statute"), the law of the state in which Parkway is
organized, empowers a company, subject to certain limitations, to
indemnify its officers and directors against expenses, including
attorneys' fees, judgments, penalties, fines, settlements and
expenses, actually and
II-1
<PAGE> 23
reasonably incurred by them in any suit or proceeding to which they are
parties unless the act or omission of the director was material to the
matter giving rise to the proceeding and was committed in bad faith, or
was the result of active and deliberate dishonesty, or the director
received an improper personal benefit or, with respect to a criminal
action or proceeding, the director had no reasonable cause to believe
their conduct was unlawful.
Parkway has entered into an indemnification agreement (the
"Indemnification Agreement") with each of its directors and officers,
and the Board of Directors has authorized Parkway to enter into an
Indemnification Agreement with each of the future directors and
officers of Parkway. The Indemnification Statute permits a
corporation to indemnify its directors and officers. However, the
protection that is specifically afforded by the Indemnification
Statute authorizes other arrangements for indemnification of directors
and officers, including insurance. The Indemnification Agreement is
intended to provide indemnification to the maximum extent allowable
by, or not in violation of, or offensive to, any law of the State of
Maryland.
The Indemnification Agreement provides that Parkway shall indemnify a
director or officer who is a party to the agreement (the "Indemnitee")
if he or she was or is a party to or otherwise involved in any
proceeding by reason of the fact that he or she was or is a director
or officer of Parkway, or was or is serving at its request in a
certain capacity of another entity, against losses incurred in
connection with the defense or settlement of such proceeding. This
indemnification shall be provided to the fullest extent permitted by
the Indemnification Agreement. This is similar to the indemnification
provided by the Indemnification Statute except that indemnification is
not available under the Indemnification Agreement to the Indemnitee
who pays any amount in settlement of a proceeding without Parkway's
written consent.
ITEM 16. EXHIBITS.
--------
5 Opinion of Jaeckle, Fleischmann & Mugel regarding the legality
of shares being registered, to be filed by amendment.
23(a) Consent of Ernst & Young LLP, filed herewith.
(b) Consent of Jaeckle, Fleischmann & Mugel (incorporated by
reference to Exhibit 5).
24 Power of Attorney, located on page II-5.
II-2
<PAGE> 24
ITEM 17. UNDERTAKINGS.
------------
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section
10(a)(3) of the Securities Act;
(ii) To reflect in the prospectus any facts or
events arising after the effective date of the registration statement (or the
most recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in the
registration statement;
(iii) To include any material information with
respect to the plan of distribution not previously disclosed in the
registration statement or any material change to such information in the
registration statement; provided, however, that paragraphs (a)(1)(i) and
(a)(1)(ii) do not apply if the registration statement is on Form S-3 or Form
S-8, and the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the registrant
pursuant to Section 13 or Section 15(d) of the Exchange Act that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the initial
bona fide offering thereof.
(3) To remove from registration by means of a
post-effective amendment any of the securities being registered which remain
unsold at the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for
purposes of determining any liability under the Securities Act, each filing of
the registrant's annual report pursuant to Section 13(a) or Section 15(d) of
the Exchange Act that is incorporated by reference in the registration
statement shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Securities Act and is, therefore, unenforceable. In the event that a payment
by the registrant
II-3
<PAGE> 25
of expenses incurred or paid by a director, officer or controlling person of
the registrant in the successful defense of any action, suit or proceeding is
asserted by such director, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question of whether such indemnification by
them is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
(d) The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act, the information omitted from the form of prospectus filed as
part of this registration statement in reliance upon Rule 430A and contained in
a form of prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4)
or 497(h) under the Securities Act shall be deemed to be part of this
registration statement as of the time it was declared effective.
(2) For the purposes of determining any liability under
the Securities Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE> 26
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Jackson, State of Mississippi on September 5, 1996.
PARKWAY PROPERTIES, INC.
By /s/ Steven G. Rogers
-------------------------------------------
Steven G. Rogers, Director,
President and Chief Operating
Officer
POWER OF ATTORNEY
Each person whose signature appears below hereby constitutes and appoints
each of Steven G. Rogers and Sarah P. Clark his or her true and lawful
attorney-in-fact and agent, each with full power of substitution and
revocation, for him or her and in his or her name, place and stead, in any and
all capacities, to sign any and all amendments (including post-effective
amendments) to this Registration Statement, and to file the same with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto each attorney-in-fact and
agent, full power and authority to do and perform each such and every act and
thing requisite and necessary to be done, as fully to all intents and purposes
as such person might or could do in person, hereby ratifying and confirming all
that said attorney-in-fact and agent or his or her substitute or substitutes,
may lawfully do or cause to be done by virtue hereof.
II-5
<PAGE> 27
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement and the foregoing Powers of Attorney have been signed by the
following persons in the capacities indicated and on the dates indicated.
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
/s/ Leland R. Speed Director and Chief Executive Officer September 5, 1996
-----------------------------------------
Leland R. Speed
/s/ Steven G. Rogers Director, President and Chief Operating September 5, 1996
---------------------------------------- Operating Officer
Steven G. Rogers
/s/ Sarah P. Clark Vice President, Chief Financial Officer, September 5, 1996
-------------------------------------- Treasurer and Secretary
Sarah P. Clark
/s/ Daniel C. Arnold Director August 21, 1996
--------------------------------------
Daniel C. Arnold
/s/ George R. Farish Director September 5, 1996
--------------------------------------
George R. Farish
/s/ Roger P. Friou Director August 21, 1996
--------------------------------------
Roger P. Friou
/s/ Joe F. Lynch Director August 21, 1996
--------------------------------------
Joe F. Lynch
/s/ C. Herbert Magruder Director September 5, 1996
--------------------------------------
C. Herbert Magruder
/s/ W. Lincoln Mossop, Jr. Director August 22, 1996
--------------------------------------
W. Lincoln Mossop, Jr.
</TABLE>
II-6
<PAGE> 1
Exhibit 23 (a)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3, No. 333- ) and related Prospectus of
Parkway Properties, Inc. for the registration of 1,140,000 shares of its common
stock and to the incorporation by reference therein of our report dated March
25, 1996, with respect to the consolidated financial statements of The Parkway
Company (Parkway Properties, Inc.'s predecessor) included in its Annual Report
(Form 10-KSB) for the year ended December 31, 1995, filed with the Securities
and Exchange Commission.
ERNST & YOUNG LLP
Jackson, Mississippi
September 5, 1996
