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): October 12, 2017

PARKWAY, INC.

(Exact Name of Registrant as Specified in its Charter)

Maryland	001-37819	61-1796261
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

San Felipe Plaza 5847 San Felipe Street, Suite 2200,
Houston, Texas	77057
(Address of Principal Executive Offices)	(Zip code)

(346) 200-3100

(Registrant’s telephone number, including area code)

N/A

(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:

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

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

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

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

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2). Emerging growth company  ☒

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☒

Introductory Note

This Current Report on Form 8-K is being filed by Parkway, Inc., a Maryland corporation (the “Company”), in connection with the completion on October 12, 2017 of the transactions contemplated by that certain definitive Agreement and Plan of Merger, dated as of June 29, 2017 (the “Merger Agreement”), by and among the Company, Parkway Properties LP, a Delaware limited partnership (the “Partnership”), Real Estate Houston US Trust (“Parent”), a Delaware statutory trust and subsidiary of Canada Pension Plan Investment Board, a Canadian Crown corporation (“CPPIB”), Real Estate Houston US LLC, a Delaware limited liability company and a subsidiary of Parent (“Merger Sub”), and Real Estate Houston US LP, a Delaware limited partnership and an indirect subsidiary of Parent (“Merger Partnership”). Pursuant to the Merger Agreement, Merger Sub merged with and into the Company, with the Company surviving (the “Surviving Company”) as a subsidiary of CPPIB (the “Company Merger”), and immediately following the Company Merger, Merger Partnership merged with and into the Partnership, with the Partnership as the surviving entity (the “Partnership Merger” and, together with the Company Merger, the “Mergers”).

Item 1.01. Entry into a Material Definitive Agreement.

The information provided in the Introductory Note of this Current Report on Form 8-K is incorporated herein by reference.

As contemplated by the Merger Agreement, at the effective time of the Partnership Merger, the Company amended and restated the Partnership’s limited partnership agreement by entering into the Third Amended and Restated Agreement of Limited Partnership of the Partnership (the “New Parkway LP Agreement”), which amends and restates the Second Amended and Restated Agreement of Limited Partnership of the Partnership in its entirety. The New Parkway LP Agreement, among other things, creates and implements the terms of the new series of preferred limited partnership units (the “Series B Units”) that were issued at the effective time of the Partnership Merger to the limited partners who elected to receive these units in the Merger in lieu of the cash merger consideration. In connection with this amendment and restatement, the Company also entered into Amendment No. 2 to the Amended and Restated Agreement of Limited Partnership (“Amendment No. 2”) of Parkway Operating Partnership LP, a Delaware limited partnership (the “Operating Partnership”), which is the Company’s operating partnership. Amendment No.2 authorizes and creates a new series of limited partnership units, having designations, preferences and other rights such that the economic interests in the new units of limited partnership are substantially the same as the Series B Units, which were issued to the Partnership to underlie the Series B Units issued by the Partnership.

Separately on October 12, 2017, in connection with the consummation of the Mergers, the Company, together with the Operating Partnership, entered into a Separation and Purchase Agreement (the “Separation Agreement”) and other related agreements with Parkway Property Investments, LLC, a Delaware limited liability company (“PPI”), pursuant to which the Company and the Operating Partnership separated their management business and operations from the remainder of their business and assets and liabilities and PPI purchased the subsidiaries that held the Company’s management business and operations (such transaction, the “Management Separation”). Each of James Heistand, Chief Executive Officer of the Company, Scott Francis, Chief Financial Officer of the Company, and Jason Bates, Chief Investment Officer of the Company, own membership interests in PPI.

Also on October 12, 2017, in connection with the Management Separation, the Company entered into an Enterprise Management Agreement (the “Enterprise Management Agreement”) and other related agreements with PPI and Parkway Operating Partnership LP, a Delaware limited partnership, pursuant to which PPI agreed to provide property management, enterprise management, transition and other services with respect to the Company, its subsidiaries and their respective properties. In exchange for performing these enterprise-level services, PPI will receive fees and expense reimbursement. The initial term of the Enterprise Management Agreement is 14 months.

Separately on October 12, 2017, following the consummation of the Mergers, the Company’s board of directors unanimously determined that a complete liquidation and dissolution of the Company (the “Plan”) was advisable and in the best interest of the Company and its stockholders, with such plan effective as of October 13,

2017. Pursuant to the Plan, the Company will cause the sale or distribution in kind to the Company’s stockholders of all or substantially all of the assets of the Company and the Company will thereafter dissolve. Pursuant to Maryland law and the Company’s charter, the Plan was approved by the affirmative vote of a majority of all of the shares of common stock entitled to vote thereon. Upon the complete distribution of all assets of the Company (the “Final Distribution”) to the holders of outstanding shares of common stock of the Company and the dissolution of the Company as contemplated by the Plan, all such shares of common stock will be canceled and no longer deemed outstanding and all rights of the holders thereof as stockholders will cease and terminate. The Company will use commercially reasonable efforts to cause the liquidation and dissolution of the Company to occur and to pay the Final Distribution to holders of outstanding shares of Common Stock no later than the second anniversary of the date of stockholder approval of the Plan. The Plan authorizes the Company’s officers and the board of directors to take such actions as may, in their judgment, be necessary or advisable in order to wind up expeditiously the affairs of the Company and complete the liquidation and dissolution thereof. Prior to the acceptance for record of the Company’s articles of dissolution by the State Department of Assessments and Taxation of Maryland, the Company’s board of directors may terminate the Plan for any reason, subject to and contingent upon the approval of such termination by the Company’s stockholders. Notwithstanding approval of the Plan by the Company’s stockholders, the board of directors may make certain modifications or amendments to the Plan without further action by or approval of the Company’s stockholders to the extent permitted under law.

Item 2.01. Completion of Acquisition or Disposition of Assets.

The information provided in the Introductory Note of this Current Report on Form 8-K is incorporated herein by reference.

On October 12, 2017, pursuant to the Merger Agreement, Merger Sub merged with and into the Company, with the Company surviving as an indirect subsidiary of CPPIB. Immediately following this merger, Merger Partnership merged with and into the Partnership, with the Partnership surviving as a subsidiary of the Company.

At the effective time of the Company Merger (the “Company Merger Effective Time”), each share of common stock, par value $0.001 per share, of the Company (a “Common Share”) issued and outstanding immediately prior to the Company Merger Effective Time was automatically converted into the right to receive an amount in cash equal to $19.05, without interest, subject to any tax withholding (the “Per Share Merger Consideration,” and together with the $4.00 special cash dividend described below, the “Per Share Transaction Consideration”). On October 10, 2017, as required by the Merger Agreement, the Company paid the previously announced $4.00 per share special cash dividend on each Common Share to holders of record as of the close of business on October 9, 2017.

At the effective time of the Partnership Merger (the “Partnership Merger Effective Time”), each unit of limited partnership interest in the Partnership held by outside limited partners issued and outstanding immediately prior to the Partnership Merger Effective Time was converted into the right to receive cash equal to the Per Share Merger Consideration, except for those limited partners who elected to receive Series B Units in the Partnership in exchange for their units. Those electing limited partners received in lieu of the Per Share Merger Consideration, in exchange for their units of limited partnership interests, an equal number of Series B Units in the Partnership as the surviving partnership of the Partnership Merger.

In addition, immediately prior to the Company Merger Effective Time on October 12, 2017, the Company redeemed each share of Series A non-voting preferred stock, par value $0.001 per share, of the Company issued and outstanding at such time for the redemption price of $100,000 in cash, plus an amount equal to all dividends (whether or not earned or declared) accumulated and unpaid thereon to, but not including, the date of the Company Merger.

Also in connection with the Mergers, (i) each outstanding option under the Company’s 2016 Omnibus Equity Incentive Plan (the “Stock Plan”), whether vested or unvested, was automatically cancelled in exchange for the right of the holder to receive cash equal to the excess of the Per Share Transaction Consideration over the exercise price for such option, (ii) each outstanding time-based restricted stock unit under the Stock Plan (an “RSU”) automatically vested in full and was cancelled in exchange for the right of the holder to receive the Per Share Transaction

Consideration plus the accumulated dividend pursuant to dividend equivalent rights for each RSU, and (iii) any vesting conditions applicable to each performance-based restricted stock unit under the Stock Plan (a “PSU”) accelerated based on actual performance (where the applicable performance goals were pro-rated through the effective time of the Company Merger), and each PSU was cancelled in exchange for the right of the holder to receive the Per Share Transaction Consideration and the accumulated dividend pursuant to dividend equivalent rights for such PSU.

An affiliate of CPPIB is a partner in a joint venture with respect to the Company’s Greenway Plaza and Phoenix Tower properties.

The foregoing description of the Merger Agreement and the transactions contemplated by the Merger Agreement is only a summary and is subject to, and qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which was filed as Exhibit 2.1 to the Current Report on Form 8-K filed by the Company with the Securities and Exchange Commission (the “SEC”) on July 5, 2017, and is incorporated herein by reference.

Item 3.01. Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing

The information provided in the Introductory Note and Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

On October 12, 2017, in connection with the completion of the Company Merger, the Company requested that the New York Stock Exchange (the “NYSE”) suspend trading in the Common Shares and file with the SEC a notification of removal from listing and registration on Form 25 to effect the delisting from the NYSE and deregistration under Section 12(b) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), of the outstanding Common Shares. As a result, all Common Shares were removed from trading on the NYSE on October 12, 2017 before the opening of trading on the NYSE. Following the effectiveness of the Form 25, the Company intends to file with the SEC a Form 15 requesting the termination of registration of the Common Shares under Section 12(g) of the Exchange Act and the suspension of reporting obligations under Section 13(a) and 15(d) of the Exchange Act with respect to the Common Shares. Once such measures become effective, the Company will no longer be required to prepare and file public reports and will cease to file reports with the SEC.

Item 3.02. Unregistered Sale of Equity Securities

Immediately prior to closing of the Mergers on October 12, 2017, the Company entered into a subscription agreement (the “Subscription Agreement”) with 10396494 Canada Inc., a corporation incorporated under the laws of Canada (“Subscriber”), pursuant to which the Company issued to Subscriber one share of its Special Voting Preferred Stock, $0.001 par value per share (the “Special Voting Preferred Share”), in exchange for a purchase price of $100. The Special Voting Preferred Share was classified pursuant to Articles Supplementary (the “Articles Supplementary”) to the Company’s Articles of Amendment and Restatement (the “Charter”), which is described in Item 5.03 of this Current Report on Form 8-K. The issuance of the Special Voting Preferred Share pursuant to the Subscription Agreement is exempt from registration pursuant to Section 4(2) of the Securities Act of 1933, as amended.

Item 3.03. Material Modification to Rights of Security Holders

The information provided in the Introductory Note and Items 2.01, 5.01 and 5.03 of this Current Report on Form 8-K is incorporated herein by reference.

Item 5.01. Changes in Control of the Registrant.

The information provided in the Introductory Note and Items 2.01, 5.02 and 5.03 of this Current Report on Form 8-K is incorporated herein by reference. The total payment with respect to the Mergers was approximately $1.2 billion, which was funded indirectly through CPPIB’s and the Company’s cash and approximately a 1% investment by certain members of the Company’s management. As a result of the closing of the Mergers, together with the investment by Company’s executive officers described in Item 5.02 below, CPPIB indirectly owns approximately 99% of the voting common equity of the Company.

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

The information provided in the Introductory Note and Item 2.01 of this Current Report on Form 8-K is incorporated herein by reference.

In connection with the consummation of the Mergers and as of the Company Merger Effective Time on October 12, 2017, each of James A. Thomas, James R. Heistand, Avi Banyasz, James H. Hance, Jr., Frank J. “Tripp” Johnson, III, Craig B. Jones and R. Dary Stone resigned from their positions as members of the board of directors of the Company. These resignations were in connection with the Company Merger and were not due to disagreement or dispute with the Company on any matter.

On October 12, 2017, effective upon the resignations described above and the Company Merger Effective Time, CPPIB appointed Hilary Spann, Lora Gotcheva and Jay Fischer to fill the vacancies created by the resigning directors and serve as directors of the board of directors of the Company.

Hilary Spann is the Managing Director, Head of Americas, Real Estate Investments for CPPIB’s real estate investments in the Americas, and is based in New York City. Hilary is also a member of CPPIB’s Real Estate Investment Committee, which has oversight for CPPIB’s global real estate investments. Hilary has 18 years of commercial real estate experience. Prior to joining CPPIB, Hilary held various roles in real estate acquisitions and asset management at JP Morgan Asset Management, and was also a consultant at PricewaterhouseCoopers. Hilary attended the Georgia Institute of Technology, where she received an undergraduate degree focused on architecture and master’s degree in urban planning. She is the chair of the Urban Development Mixed Use Council (Red Flight) for ULI, and is an active member of WX – Women Executives in Real Estate, a New York based professional and charitable organization.

Lora Gotcheva is a Director for CPPIB’s real estate investments in the Americas, and is based in Toronto. Lora is responsible for the origination, underwriting, structuring and management of office and healthcare investments in the U.S. Lora has 12 years of commercial real estate experience. Prior to joining CPPIB, Lora held various positions at Fidelity International, Macquarie Capital and Morgan Stanley. Lora earned an M.B.A. from the Wharton School at the University of Pennsylvania, where she graduated as a Palmer Scholar, and a B.A. in Economics from Mount Holyoke College.

Jay Fischer is focused on CPPIB’s real estate investments in the Americas, and is based in New York City. Jay has 9 years of commercial real estate experience. Prior to joining CPPIB, Jay held various roles in real estate acquisitions and asset management at Rockwood Capital, and also worked in the investment banking department at UBS. He holds an M.B.A. from The Wharton School at the University of Pennsylvania and a B.S. from The School of Hotel Administration at Cornell University.

Also in connection with the consummation of the Mergers and as of the Company Merger Effective Time on October 12, 2017, M. Jayson Lipsey resigned from his position as Chief Operating Officer of the Company. Each of James R. Heistand, Scott E. Francis and Jason A. Bates will remain as officers of the Company but, as described below, have terminated their employment with the Company.

In connection with the Management Separation described in Item 1.01 above, each of James R. Heistand, Scott E. Francis and Jason A. Bates, who each are members of and employed by PPI, entered into Termination and Investment Agreements (each a “Termination Agreement”) with the Company and CPPIB, effective immediately prior to closing of the Mergers. Pursuant to the Termination Agreements, each applicable executive and the Company agreed to terminate the executive’s Employment Agreement with the Company and letter agreement entered into by and among the executive, the Company and CPPIB in connection with announcement of the Mergers on June 29, 2017, which otherwise would have become an amendment to the executive’s employment agreement upon closing of the Mergers. The Termination Agreements also retain the obligation of the executives to invest in the acquisition vehicle used by CPPIB in the Merger.

Finally, on October 12, 2017, as part of the Management Separation and as an inducement for Mr. Heistand to invest his skills, time and money into PPI, which will provide property management, enterprise management, transition and other services to the Company, its subsidiaries and the office properties received by CPPIB in the Mergers, as described in Item 1.01 above, the Company entered into a letter agreement with Mr. Heistand pursuant to which the Company paid Mr. Heistand an agreed amount on the date of the closing of the Company Merger.

Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

The information provided in the Introductory Note and Item 2.01 and Item 5.01 of this Current Report on Form 8-K is incorporated herein by reference.

On October 11, 2017, pursuant to the Maryland General Corporation Law, the Company filed Articles Supplementary (the “Articles Supplementary”) to the Company’s Articles of Amendment and Restatement (the “Charter”) with the State of Maryland. In accordance with the Merger Agreement, the Articles Supplementary amend the Charter, effective as of October 12, 2017, to reclassify one Common Share into one Special Voting Share. The Special Voting Preferred Share has a liquidation preference of $100 and will be entitled to a preferred dividend of 5% of the liquidation preference per annum, but has no other economic rights. The Special Voting Preferred Share has no voting or consent rights, other than the right to vote for the election or removal of directors. The Special Voting Preferred Share entitles the holder thereof to cast such number of votes as is equal to 70% of the aggregate number of votes entitled to be cast by all shares of stock of the Company for the election or removal of directors.

The above description of the Articles Supplementary does not purport to be complete and is qualified in its entirety by reference to the full text of the Articles Supplementary, attached as exhibit 3.1 to this Current Report on Form 8-K, which is incorporated herein by reference.

At the Company Merger Effective Time on October 12, 2017, the Charter and bylaws of the Company became the charter and bylaws of the Surviving Company.

Item 5.07 Submission of Matters to a Vote of Security Holders

On October 12, 2017, the sole stockholder of the Company following the consummation of the Mergers acted by written consent to approve the Plan described in Item 1.01 of this Current Report on Form 8-K and such consent became effective on October 13, 2017.

Item 8.01. Other Events

On October 12, 2017, the Company issued a press release announcing the completion of the Mergers, a copy of which is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits

(d) Exhibits

Exhibit No.	Description
3.1	Articles Supplementary, dated October 12, 2017, to the Articles of Amendment and Restatement of Parkway, Inc.
99.1	Press Release of Parkway, Inc. dated October 12, 2017.

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:	October 17, 2017	PARKWAY, INC.
		BY:	/s/ A. Noni Holmes-Kidd
			A. Noni Holmes-Kidd
			Vice President, General Counsel and Secretary

EX-3.1

Exhibit 3.1

PARKWAY, INC.

SPECIAL VOTING PREFERRED STOCK

Articles Supplementary Reclassifying and Designating One Share of Common Stock as

Special Voting Preferred Stock

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

FIRST: Pursuant to the authority granted and vested in the Board of Directors of the Corporation (the “Board”) by Article V of the charter of the Corporation (the “Charter”), the Board adopted resolutions reclassifying and designating one (1) unissued share of common stock, $0.001 par value per share (“Common Stock”), of the Corporation, as a share of Special Voting Preferred Stock, $0.001 par value per share, of the Corporation, having the preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption as follows, which, upon any restatement of the Charter, shall become a part of Article V of the Charter, with any appropriate renumbering or relettering of the sections or subsections hereof:

Section 1. Designation and Number. One share of Common Stock is classified and designated as “Special Voting Preferred Stock,” $0.001 par value per share (the “Special Voting Preferred Stock”), with the following preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption.

Section 2. Ranking. The Special Voting Preferred Stock shall rank:

(a) Senior, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, to the Common Stock, to the Limited Voting Stock, $0.001 par value per share (the “Limited Voting Stock”), and to all other class or series of the Corporation’s stock (together with the Common Stock, the “Junior Securities”), the terms of which expressly provide that such class or series of stock ranks junior to the Special Voting Preferred Stock as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up;

(b) On a parity, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, to any class or series of the Corporation’s stock (collectively, the “Parity Securities”), the terms of which expressly provide that such class or series of stock ranks on a parity with the Special Voting Preferred Stock as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up; or

(c) Junior, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, to any class or series of the Corporation’s stock (collectively, the “Senior Securities”), the terms of which expressly provide that such class or series of stock ranks senior to the Special Voting Preferred Stock as to the payment of dividends and the distribution of assets upon liquidation, dissolution or winding up.

Section 3. Dividends.

(a) The holder of the outstanding share of Special Voting Preferred Stock shall be entitled to receive, when and as authorized by the Board and declared by the Corporation, out of funds legally available for the payment of dividends, cumulative preferential cash dividends per share of Special Voting Preferred Stock at the annual rate of 5.00% of the total of $100.00 plus all accumulated and unpaid dividends thereon. Such dividends shall accrue on the outstanding share of Special Voting Preferred Stock on a daily basis and be cumulative from the date on which the share of Special Voting Preferred Stock is first issued (the “Original Issue Date”), and shall be payable quarterly in arrears on or before March 31, June 30, September 30 and December 31 of each year (each, a “Dividend Payment Date”) or, if not a business day, the next succeeding business day. Any dividend payable on the share of Special Voting Preferred Stock for any partial dividend period will be computed on the basis of a 360-day year consisting of twelve 30-day months (it being understood that the dividend payable on December 31, 2017, will be for less than a full dividend period). A “dividend period” shall mean, with respect to the first “dividend period,” the period from and including the Original Issue Date to and including the first Dividend Payment Date or other date as of which accrued dividends are to be calculated and, with respect to each subsequent “dividend period,” the period from but excluding a Dividend Payment Date to and including the next succeeding Dividend Payment Date or other date as of which accrued dividends are to be calculated. Dividends will be payable to the holder of record as he, she or it appears in the stock transfer records of the Corporation at the close of business on the applicable record date, which shall such date designated by the Board for the payment of dividends (each, a “Dividend Record Date”).

(b) No dividends on the share of Special Voting Preferred Stock shall be declared by the Corporation or paid or set apart for payment by the Corporation at such time as the terms and provisions of any written agreement binding upon the Corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law.

(c) Notwithstanding the foregoing, dividends on the share of Special Voting Preferred Stock shall accrue whether or not the terms and provisions set forth in Section 3(b) hereof at any time prohibit the current payment of dividends, whether or not the Corporation has earnings, whether or not there are funds legally available for the payment of such dividends and whether or not such dividends are authorized or declared. Accrued but unpaid dividends on the share of Special Voting Preferred Stock will accumulate as of the Dividend Payment Date on which they first become payable.

(d) Except as provided in Section 3(f) below, unless full cumulative dividends on the outstanding share of Special Voting Preferred Stock have been or contemporaneously are paid or declared and a sum sufficient for the payment thereof is set apart for payment for all past dividend periods, no dividends (other than in Junior Securities) shall be paid or declared and set

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apart for payment, nor shall any other distribution be made upon any Junior Securities, nor shall any Junior Securities be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any Junior Securities) by the Corporation (except by conversion into or exchange for other Junior Securities).

(e) Any dividend payment made on the share of Special Voting Preferred Stock shall first be credited against the earliest accrued but unpaid dividend due with respect to such share which remains payable. The holder of the share of Special Voting Preferred Stock shall not be entitled to any dividend, whether payable in cash, property or shares, in excess of full cumulative dividends as described in this Section 3.

(f) Notwithstanding the provisions of this Section 3 and regardless of whether dividends are paid in full (or declared and a sum sufficient for such full payment is set apart) on the share of Special Voting Preferred Stock, the Corporation shall not be prohibited or limited from (i) paying dividends in Junior Securities, (ii) converting or exchanging shares of stock of any class or series for Junior Securities, (iii) redeeming, purchasing or otherwise acquiring shares of stock of any class or series pursuant to the provisions Article VI of the Charter or any comparable provision of the Charter relating to any class or series of stock that may, in the future, be classified and designated, or otherwise in order to assist the Corporation in remaining qualified as a real estate investment trust, (iv) a redemption, purchase or other acquisition of Junior Securities made for purposes of and in compliance with the requirements of an employee incentive or benefit plan of the Corporation or any of its subsidiaries or (v) purchasing or acquiring Junior Securities pursuant to a merger, consolidation or statutory share exchange approved by the stockholders of the Corporation in accordance with the Maryland General Corporation Law (the “MGCL”) and the Charter (including Section 8 hereof).

Section 4. Liquidation Preference.

(a) Upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, the holder of the share of Special Voting Preferred Stock will be entitled to be paid, or have the Corporation declare and set apart for payment, out of the assets of the Corporation legally available for distribution to its stockholders, before any distribution of assets is made to holders of any Junior Securities, a liquidation preference equal to the sum of the following (collectively, the “Liquidation Preference”): (i) $100.00 plus (ii) all accrued and unpaid dividends thereon through and including the date of payment. In the event that the Corporation elects to set apart the Liquidation Preference for payment, the Special Voting Preferred Stock shall remain outstanding until the holder thereof is paid the full Liquidation Preference therefor, which payment shall be made no later than immediately prior to the Corporation making its final liquidating distribution on shares of Common Stock.

(b) After payment of the full amount of the Liquidation Preference to which the holder is entitled, the share of Special Voting Preferred Stock shall cease to be outstanding and the holder of share of the Special Voting Preferred Stock will have no right or claim to any of the remaining assets of the Corporation. The consolidation, merger or conversion of the Corporation with or into any other person, corporation, trust or entity, or the sale, lease, transfer or conveyance of all or substantially all of the property or business of the Corporation, shall not be deemed to constitute a liquidation, dissolution or winding up of the affairs of the Corporation.

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Section 5. Automatic Redemption.

(a) The outstanding share of Special Voting Preferred Stock shall automatically be redeemed by the Corporation (the “Automatic Redemption”) at the time that is twenty-four hours after the issuance of the share of Special Voting Preferred Stock (the “Automatic Redemption Time”), without any further action by the Corporation or any notice to the holder thereof, for a redemption price (the “Automatic Redemption Price”) equal to $100.00 plus all accrued and unpaid dividends thereon to and including the date of the Automatic Redemption Time, if, at the Automatic Redemption Time, the merger of Real Estate Houston US LLC, a Delaware limited liability company (“Merger Party”), with and into the Corporation, pursuant to the Agreement and Plan of Merger, dated June 29, 2017, among the Corporation and Real Estate Houston US Trust, a Delaware statutory trust, Merger Party, Parkway Properties LP, a Delaware limited partnership, and Real Estate Houston US LP, a Delaware limited partnership, as it may be amended from time to time (such merger, the “Merger”), has not become effective. From and after the Automatic Redemption Time, dividends will cease to accrue on the share of Special Voting Preferred Stock, the share of Special Voting Preferred Stock will be redeemed and will no longer be deemed outstanding, and all rights of the holder of such share will terminate, including without limitation the voting rights under Section 8 hereof and the distribution restrictions under Section 3(b) hereof, except the right to receive the Automatic Redemption Price therefor in accordance with Section 5(b). After any Automatic Redemption, the share of Special Voting Preferred Stock so redeemed shall remain an authorized share of Special Voting Preferred Stock and shall be available for reissue by the Corporation.

(b) Payment of Automatic Redemption Price. As soon as reasonably practicable (but, in any event, not more than 5 business days) after the Automatic Redemption Time, the Corporation shall send to the record holder of the share of Special Voting Preferred Stock, by check, wire transfer or other delivery of immediately available U.S. funds, the amount of the full Automatic Redemption Price therefor.

Section 6. Right of Optional Redemption.

(a) From and after the effective date of the Merger, the Corporation, at its option, may, upon notice given in accordance with Section 6(b), redeem the outstanding share of Special Voting Preferred Stock at any time or from time to time, for cash, at a redemption price (the “Optional Redemption Price”) equal to $100.00 plus accrued and unpaid dividends thereon to and including the redemption date therefore set by the Board (the “Redemption Date”).

(b) Procedures for Optional Redemption.

(i) Notice as to the Redemption Date and the effective time of the redemption shall be provided to, upon notice given in accordance with Section 6(b), the record holder of the share of Special Voting Preferred Stock in any manner permitted under the MGCL, the Charter and the Bylaws of the Corporation for the delivery of notice of an annual meeting of stockholders of the Corporation.

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(ii) If notice of redemption of the share of Special Voting Preferred Stock has been given in accordance with this Section 6(b) and if the full Optional Redemption Price therefor has been delivered to the record holder of the share of Special Voting Preferred Stock by check, wire transfer or other delivery of immediately available U.S. funds or set apart by the Corporation for the benefit of the holder of the share of Special Voting Preferred Stock, (in which case, the notice of redemption shall specify the place or places where the share of Special Voting Preferred Stock must be surrendered for payment of the Redemption Price and any other documents required in connection with such redemption) then, from and after the effective time of such redemption specified in the notice of redemption, dividends will cease to accrue on the share of Special Voting Preferred Stock, the share of Special Voting Preferred Stock will be redeemed and will no longer be deemed outstanding, and all rights of the holder of such share will terminate, except the right to receive the Optional Redemption Price therefor in accordance with this Section 6(b).

Section 7. Conversion. The share of Special Voting Preferred is not convertible into or exchangeable for any other property or securities of the Corporation.

Section 8. Voting Rights.

(a) The holder of the share of Special Voting Preferred Stock shall be entitled to vote together with the holders of shares of Common Stock and the holders of shares of Limited Voting Stock, with the holders of all such shares voting together as a single class, on the election or the removal of any director of the Corporation for whose election or removal, as applicable, the holders of shares of Common Stock and the holders of shares of Limited Voting Stock are entitled to vote, and, except as set forth in Section 8(b) below, the share of Special Voting Preferred Stock shall have no other voting rights. With respect to only the election or removal of directors of the Corporation by the holders of shares of Common Stock and the holders of shares of Limited Voting Stock, the share of Special Voting Preferred Stock shall entitle the holder thereof to cast an aggregate number of votes equal to seventy percent (70%) of the aggregate number of votes entitled to be cast by stockholders of the Corporation entitled to vote in such election or for such removal (the “Special Voting Right”).

(b) So long as the share of Special Voting Preferred Stock is outstanding, the Corporation shall not, without first obtaining the approval of the holder of the then-outstanding share of Special Voting Preferred Stock, voting as a separate class:

(i) amend, alter or repeal any provision of the Charter (whether by merger, consolidation, transfer or conveyance of all or substantially all of the Corporation’s assets or otherwise) so as to adversely affect the terms, preferences, conversion or other rights, voting powers or rights, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the share of Special Voting Preferred Stock; provided, however, that neither:

(A) the amendment of the Charter so as to authorize or create, or to increase the authorized amount of, any Junior Securities, Parity Securities or Senior Securities nor

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(B) the amendment of the Charter, whether by merger, consolidation, transfer or conveyance of all or substantially all of the Corporation’s assets or other business combination (an “Event”), (x) if the share of Special Voting Preferred Stock (or securities of any successor person or entity to the Corporation into which share of Special Voting Preferred Stock has been converted) remains outstanding with the terms thereof unchanged in all material respects or the holders of the share of Special Voting Preferred Stock receive securities of a successor person or entity with substantially identical rights as those of the share of Special Voting Preferred Stock, taking into account that, upon the occurrence of an Event, the Corporation may not be the surviving entity, or (y) if the holder of the share of Special Voting Preferred Stock shall receive in connection with such Event an amount of cash equal to the Liquidation Preference,

shall be deemed to adversely affect the terms, preferences, conversion or other rights, voting powers or rights, restrictions, limitations as to dividends or other distributions, qualifications or terms or conditions of redemption of the share of Special Voting Preferred Stock or entitle the holder of the share of Special Voting Preferred Stock to vote thereon or consent thereto, so long as any such amendment of the Charter or other Event does not restrict, reduce or amend the Special Voting Right; or

(ii) increase or decrease the total number of authorized, outstanding or issued shares of Special Voting Preferred Stock.

Section 9. Application of Article VI. The share of Special Voting Preferred Stock shall be subject to the provisions of Article VI of the Charter.

Section 10. Status of Redeemed or Reacquired Shares. If the share of Special Voting Preferred Stock shall be issued and reacquired in any manner by the Corporation other than pursuant to an Automatic Redemption as set forth in Section 5(a), it shall be restored to the status of an authorized but unissued share of Common Stock, without designation as to class or series.

SECOND: The share of Special Voting Preferred Stock has been reclassified by the Board under the authority contained in Article V of the Charter.

THIRD: These Articles Supplementary have been approved by the Board in the manner and by the vote required by law.

FOURTH: These Articles Supplementary shall become effective at 12:01 a.m. (Eastern Time) on October 12, 2017.

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

- Signature Page Follows -

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IN WITNESS WHEREOF, the Corporation has caused these Articles Supplementary to be signed in its name and on its behalf by its Vice President, Chief Financial Officer and Chief Accounting Officer and attested to by its Vice President, General Counsel and Corporate Secretary on this 11th day of October, 2017.

PARKWAY, INC.
By:	/s/ Scott E. Francis
Name:	Scott E. Francis
Title:	Executive Vice President, Chief Financial Officer and Chief Accounting Officer

ATTEST:
/s/ A. Noni Holmes-Kidd
Name:	A. Noni Holmes-Kidd
Title:	Vice President, General Counsel and Corporate Secretary

EX-99.1

Exhibit 99.1

Canada Pension Plan Investment Board Closes Merger with Parkway, Inc.

TORONTO and HOUSTON, Oct. 12, 2017 /PRNewswire/ — Canada Pension Plan Investment Board (“CPPIB”) and Parkway, Inc. (NYSE: PKY) (“Parkway”), a Houston-based real estate investment trust, announced today the completion of the previously announced merger of Parkway with an affiliate of CPPIB for US$1.2 billion, or US$23.05 per share. The closing follows the satisfaction of all conditions to closing the merger, including the receipt of approval of the transaction by Parkway stockholders on September 25, 2017.

Under the terms of the merger agreement, Parkway stockholders are entitled to receive cash payments totaling US$23.05 per share for each share of Parkway common stock held from the record date of Parkway’s cash dividend through the closing date. The US$23.05 per share consideration consists of US$19.05 per share payable pursuant to the merger, plus a US$4.00 per share special cash dividend paid on October 10, 2017.

About Canada Pension Plan Investment Board

Canada Pension Plan Investment Board (CPPIB) is a professional investment management organization that invests the funds not needed by the Canada Pension Plan (CPP) to pay current benefits on behalf of 20 million contributors and beneficiaries. In order to build a diversified portfolio of CPP assets, CPPIB invests in public equities, private equities, real estate, infrastructure and fixed income instruments. Headquartered in Toronto, with offices in Hong Kong, London, Luxembourg, Mumbai, New York City, São Paulo and Sydney, CPPIB is governed and managed independently of the Canada Pension Plan and at arm’s length from governments. At June 30, 2017, the CPP Fund totalled C$326.5 billion. For more information about CPPIB, please visit www.cppib.com or follow us on LinkedIn or Twitter.

About Parkway

Parkway, Inc. is an independent, publicly traded, self-managed real estate investment trust (“REIT”) that owns and operates high-quality office properties located in attractive submarkets in Houston, Texas. As of June 30, 2017, our portfolio consists of five Class A assets comprising 19 buildings and totaling approximately 8.7 million rentable square feet in the Greenway, Galleria and Westchase submarkets of Houston.

Forward Looking Statements

Certain statements contained in this press release, including those that express a belief, expectation or intention, as well as those that are not statements of historical fact, are forward-looking statements within the meaning of the federal securities laws and as such are based upon Parkway’s current beliefs as to the outcome and timing of future events. There can be no assurance that actual future developments affecting Parkway will be those anticipated by Parkway. Parkway cautions investors that any forward-looking statements presented in this press release are based on management’s beliefs and assumptions made by, and information currently available to, management. When used, the words “anticipate,” “assume,” “believe,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “may,” “might,” “plan,” “potential,” “should,” “will,” “result” or similar expressions that do not relate solely to historical matters are intended to identify forward-looking statements. You can also identify forward-looking statements by discussions of strategy, plans or intentions. Forward-looking statements involve risks and uncertainties (some of which are beyond Parkway’s control) and are subject to change based upon various factors, including but not limited to the following risks and uncertainties: the outcome of any legal proceedings that may be instituted against Parkway and others related to the merger agreement; the ability of Parkway to implement its operating strategy; changes in economic cycles; and competition within the office properties real estate industry; and other risks and uncertainties detailed from time to time in Parkway’s Securities and Exchange Commission (the “SEC”) 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 any forward-looking statement. While forward-looking statements reflect Parkway’s good faith beliefs, they are not guarantees of future performance. Any forward-looking statement 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. Except as required by law, Parkway undertakes no obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes.