AGREEMENT AND AMENDMENT

        This Agreement and Amendment (this "Agreement") is dated as of
January__, 2005, by and between PARKWAY PROPERTIES LP, a Delaware limited
partnership, having an address at One Jackson Place, 188 East Capitol Street,
Suite 1000, Jackson, Mississippi 39201 ("Parkway"), and 233 CHICAGOINVEST, INC.,
a Delaware corporation, having an address at 280 Park Avenue, 37th Floor, New
York, New York  10017 ("Chicago Inc.").

RECITALS

        A.        Chicago OfficeInvest, LLC, a Delaware limited liability
company ("Chicago LLC"), Parkway and Parkway 233 North Michigan Manager, Inc.
(the "Company Manager"), a Delaware corporation, have entered into that certain
Amended and Restated Operating Agreement of Parkway 233 North Michigan, LLC (the
"Property Operating Agreement"), dated as of May 30, 2002;

        B.         Chicago LLC is the owner of sixty-nine and ninety-three
hundredths percent (69.93%) of the Common Membership Interests (as defined in
the Property Operating Agreement) in Parkway 233 North Michigan, LLC (the
"Company"), a Delaware limited liability company;

       C.        Parkway is the owner of twenty-nine and ninety-seven hundredths
percent (29.97%) of the Common Membership Interests in the Company;

        D.        The Company Manager is owner of ten hundredths percent (0.10%)
of the Common Membership Interests in the Company;

        E.         Chicago LLC is the owner of one hundred percent (100%) of the
Preferred Membership Interests (as defined in the Property Operating Agreement)
in the Company;

        F.         Parkway Properties, Inc. ("PPI"), a Maryland corporation, is
the owner of 30 shares of common stock, no par value per share, of the Company
Manager, and Chicago LLC is the owner of 70 shares of common stock, no par value
per share, of the Company Manager;

        G.        Chicago Inc. and Investcorp Properties Limited, a Delaware
corporation ("IPL") have entered into that certain Operating Agreement of
Chicago OfficeInvest, LLC (the "Chicago LLC Operating Agreement"), dated as of
May 30, 2002;

        H.        Chicago Inc. is the owner of ninety-seven and fifty hundredths
percent (97.50%) of the membership interests in Chicago LLC, and IPL is the
owner of two and fifty hundredths percent (2.50%) of the membership interests in
Chicago LLC;

        I.          Simultaneously herewith, (i) the Company is redeeming
Chicago LLC's Preferred Membership Interest in the Company and paying to Chicago
LLC the amount of $[TO BE INSERTED] on account of the Redemption Amount (as
defined in the Property Operating Agreement), and (ii) Chicago LLC is
distributing to Chicago Inc. the amount of $[TO BE INSERTED] pursuant to the
terms of Section 9(b) of the Chicago LLC Operating Agreement;

--------------------------------------------------------------------------------

        J.          Simultaneously herewith, on account of the Redemption
Amount, Parkway only is making an additional capital contribution to the Company
to fund the Redemption Amount; and

        K.        Following receipt of the payments to Chicago LLC and Chicago
Inc., (i) on the date hereof (the "Initial Closing Date"), Chicago Inc. shall
transfer to Parkway, and Parkway shall acquire from Chicago Inc., 90% of all of
the membership interests in Chicago LLC, and (ii) on the Second Closing Date (as
hereinafter defined), IPL and Chicago Inc. shall transfer to Parkway, and
Parkway shall acquire from IPL and Chicago Inc., all of their remaining
membership interests in Chicago LLC, subject to and in accordance with the terms
of the Agreement.

        NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
set forth herein and other good and valuable consideration, the receipt and
sufficiency of which are acknowledged, the parties agree as follows:

        1.         Simultaneously herewith, as described in the Recitals hereof
(i) Parkway is making the additional capital contributions in the amount of $[TO
BE INSERTED] on account of the Redemption Amount, (ii) the Company is paying
such amount to Chicago LLC and redeeming Chicago LLC's Preferred Membership
Interests, and (iii) Chicago LLC is distributing to Chicago Inc. the amount of
$[TO BE INSERTED] pursuant to the terms of Section 9(b) of the Chicago LLC
Operating Agreement.

        2.         Following receipt of the distributions described above, and
upon receipt of the Initial Purchase Price (as hereinafter defined), Chicago
Inc. is transferring and assigning to Parkway a 90% membership interest in
Chicago LLC, including, without limitation, Chicago Inc.'s right to profits,
losses and distributions after the Initial Closing Date (the "Membership
Interests") pursuant to that certain Assignment of Membership Interests in the
form of Exhibit A annexed hereto and made a part hereof (the "Assignment
Agreement").  In addition, Chicago Inc. shall execute and deliver to Parkway a
FIRPTA certificate in the form of Exhibit A-1 annexed hereto and made a part
hereof.

        3.         (a)        Simultaneously herewith, the Company and the
Company Manager are distributing to each of the members in the Company and the
shareholders in the Company Manager, as the case may be (in accordance with
their Applicable Percentages), an amount equal to all cash, as of the Initial
Closing Date, in any accounts of the Company and/or the Company Manager and all
deposits or reserves held by the Mortgage Lender (as defined in the Property
Operating Agreement) (it being understood and agreed that the foregoing funds
received by Chicago LLC shall be distributed to Chicago Inc. and IPL, 97.50% and
2.50%, respectively); excluding, however, any deposits or reserves held by the
Mortgage Lender or the Company on account of real estate taxes affecting the
Property.  In addition, simultaneously herewith, Chicago LLC is distributing to
each of the members in Chicago LLC (in accordance with their Percentages
Interests) all cash, as of the Initial Closing Date, in any accounts of Chicago
LLC (it being understood and agreed that the foregoing funds shall be
distributed to Chicago Inc. and IPL, 97.50% and 2.50%, respectively).

--------------------------------------------------------------------------------

(b)        The purchase price for the Membership Interests (the "Initial
Purchase Price") is an amount equal to 90% of $46,295,000 (i.e., $41,665,500). 
In addition, the parties shall prorate and adjust the following items as more
particularly described on the closing statement set forth on Schedule 1 annexed
hereto and made a part hereof (it being understood and agreed that all
prorations and adjustments on the Initial Closing Date for Chicago Inc. shall be
allocated and paid 97.50% to Chicago Inc. and 2.50% to IPL):  rent, additional
rent, rent escalations (including estimates of rent escalations), interest under
the Mortgage Loan (as defined in the Property Operating Agreement), security
deposits, and other revenues, costs and expenses associated with the ownership,
operation and maintenance of the Property (as defined in the Property Operating
Agreement) (including under service contracts and insurance policies).  Parkway
shall pay the Initial Purchase Price, subject to the prorations and adjustments
set forth on Schedule 1 hereto, by wire transfer of immediately available
federal funds to the account(s) shown as an attachment to the closing statement
set forth on Schedule 1 hereto.  The parties hereto acknowledge and agree the
prorations and adjustments set forth on Schedule 1 with respect to the transfer
of the Membership Interests are final and binding and not subject to
recomputation, readjustment or correction.

(c)        All state and local (including county) transfer taxes and all other
costs and expenses associated with the transfer of the Membership Interests
shall be paid by Parkway.  Parkway shall also pay all costs, expenses and fees
associated with obtaining the consents and approvals described in Section 5(a)
of this Agreement.  In addition, on the Initial Closing Date, the Company
(without contribution by Chicago LLC, IPL and/or Chicago Inc. or deduction from
the Initial Purchase Price) shall distribute to Parkway an amount equal to 90%
of $400,000 (i.e., $360,000), on account of Parkway's promoted interest under
Section 3.03(a)(3) of the Property Operating Agreement.

(d)        In connection with the transfer of the Membership Interests, each
party shall execute and deliver any transfer declaration or other documentation
or forms required to comply with any state and/or local transfer tax
requirements as to the transfer of the Membership Interests.

        4.         Upon the execution and delivery of the Assignment Agreement
and the receipt of funds as described in Section 1 and Section 3 of this
Agreement, the Chicago LLC Operating Agreement shall be deemed amended as
follows: (a) Parkway shall be deemed admitted as a member in Chicago LLC;
(b) the Percentage Interest of each member in Chicago LLC shall be as follows: 
(i) Chicago Inc., 7.5%; (ii) IPL, 2.5%; and (iii) Parkway, 90%; and (c)  Chicago
LLC shall distribute all Cash Flow (as defined in the Property Operating
Agreement) and all Net Sale or Refinancing Proceeds (as defined in the Property
Operating Agreement) received by Chicago LLC in accordance with the foregoing
Percentage Interests.  Upon the execution and delivery of the Assignment
Agreement and the receipt of the funds described in Section 1 and Section 3 of
this Agreement, the Company Operating Agreement shall be amended as follows: 
(i) as of

--------------------------------------------------------------------------------

December 17, 2004, all capital expenditures, tenant improvements and
inducements, leasing commissions, repairs, equipment purchases and any other
item relating to the business of the Company that is not properly characterized
as a current operating expense under Section 3.02(b)(2)(i) of the Company
Operating Agreement (including, without limitation, on account of proposed
leases with the following proposed tenants: Bridgeport Networks, Creative
circle, and an unnamed tenant taking the former Worldbook space on 19th floor)
(and any and all reserves related to any of the foregoing) (all of the foregoing
are collectively, "Capital Expenses") shall be deemed to be the sole
responsibility of Parkway and shall not be deducted from Cash Flow or Net Sale
or Refinancing Proceeds; (b) notwithstanding the terms of Article III of the
Company Operating Agreement, all distributions of Cash Flow and, following
April 1, 2005, Net Sale or Refinancing Proceeds shall be distributed (without
deductions on account of any member loans or Capital Expenses) in accordance
with Applicable Percentages (it being understood and agreed that notwithstanding
the terms of Section 5(b) of the Shareholders Agreement (as defined in the
Company Operating Agreement), all funds received by the Company Manager under
such Section 5(b) shall be distributed in accordance with Applicable
Percentages); and (c) the percentages set forth in Section 9.01(c) of the
Property Operating Agreement shall be deemed reduced from 70% to 7%.  Except as
amended by this Agreement, all of the terms, covenants and conditions of the
Property Operating Agreement, the Shareholders Agreement and the Chicago LLC
Operating Agreement are hereby ratified and confirmed and shall continue to be
and remain in full force and effect.

        5.         (a)        Subject to the terms of clause (e) below, if at
any time before April 1, 2005, Parkway has obtained the consent of the Mortgage
Lender (as defined in the Property Operating Agreement) and any required rating
agency to the transfer of IPL's and Chicago Inc.'s remaining membership interest
in Chicago LLC (it being understood and agreed that any document or instrument
evidencing such consent(s) shall be without any recourse, representation,
warranty, obligation, liability or cost or expense whatsoever to IPL or Chicago
Inc., or their respective affiliates) (collectively, the "Section 5 Consent"),
then, in any such event, Parkway shall give written notice of such consent to
IPL and Chicago Inc., and no later than three (3) business days (TIME BEING OF
THE ESSENCE) following obtaining the Section 5 Consent (the "Second Closing
Date"), subject to the further terms of this Section 5, IPL and Chicago Inc.
shall transfer, and Parkway shall acquire, all of IPL's and Chicago Inc.'s
remaining membership interests in Chicago LLC, for a purchase price (the "Second
Purchase Price") equal to 10% of $46,295,000 (i.e. $4,629,500).  In addition,
the parties shall prorate and adjust for each of the line items set forth on the
closing statement set forth on Schedule 1 hereto (it being understood and agreed
that the amounts will be different from those set forth on Schedule 1 on the
date hereof), and shall include, without limitation, to the extent not set forth
on a line item on Schedule 1 hereto a proration and adjustment for rent,
additional rent, rent escalations (including estimates of rent escalations),
interest under the Mortgage Loan, and other revenues, costs and expenses
associated with the ownership, operation and maintenance of the Property
(including under service contracts and insurance policies).  In addition, at the
Second Closing (as hereinafter defined), the Company, the Company Manager and
Chicago LLC shall distribute to Parkway, IPL and Chicago Inc., 90%, 7.5% and
2.5%, respectively, an amount equal to all cash, as of the Second Closing, in
any accounts of the Company and/or the Company Manager and all deposits or
reserves held by the Mortgage Lender; excluding, however, any deposits or
reserves held by the Mortgage Lender or the Company on account of real estate
taxes affecting the Property. The parties hereto acknowledge and agree the
prorations and adjustments made on the Second Closing Date shall be final and
binding and not subject to recomputation, readjustment or correction.  IPL,
Chicago Inc. and Parkway acknowledge and agree that no additional purchase and
sale contract shall be required to be executed and delivered in connection with
the transactions contemplated by this Section 5, it being understood and agreed
that the terms of this Section 5 shall constitute a purchase and sale contract.

                    (b)        The following procedures shall apply to the
closing (the "Second Closing") of the transfer of membership interests
contemplated by this Section 5 on the Second Closing Date:

--------------------------------------------------------------------------------

                                1.         At the Second Closing, (p) Parkway
shall pay to IPL and Chicago Inc. the Second Purchase Price pro rata (based on
the following percentages:  (x) IPL, 25%, and (y) Chicago Inc., 75%) by wire
transfer of immediately available federal funds to the accounts identified in
writing by IPL and Chicago Inc. prior to the Second Closing, and (q) each of
Parkway, IPL and Chicago Inc. shall execute and deliver a closing statement
reflecting the Second Purchase Price and the prorations and adjustments
described in clause (a) above (it being understood and agreed that all
prorations and adjustments at the Second Closing shall be allocated and paid
90.00% to Parkway, 7.50% to Chicago Inc. and 2.50% to IPL).

                                2.         At the Second Closing and upon
receipt of the funds described in clause (1) above, IPL and Chicago Inc. shall
each execute and deliver (x) an assignment of its remaining membership interests
in Chicago LLC in the form of the Assignment Agreement, without recourse,
representation or warranty whatsoever, except for the representation that,
subject to the terms of the loan documents evidencing and/or securing the
Mortgage Loan, the Property Operating Agreement, the Shareholders Agreement
and/or the Chicago LLC Operating Agreement, IPL and Chicago Inc., as the case
may be, owns its right, title and interest in and to Chicago LLC, free and clear
of all liens, charges and encumbrances, and (y) a FIRPTA certificate in the form
annexed hereto as Exhibit A-1 hereto;

                                3.         At the Second Closing and upon
receipt of the funds described in clause (1) above, each of Parkway, IPL and
Chicago Inc. shall execute and deliver (I) the Releases in the form set forth on
Exhibit C and Exhibit C-1 annexed hereto and made a part hereof, as the case may
be, and (II) any transfer declaration or other documentation or forms required
to comply with any state and/or local (including county) transfer tax
requirements as to the transactions contemplated by this Section 5 (it being
understood and agreed that all state and local (including county) transfer taxes
and all other costs and expenses associated with consummating the transactions
contemplated by this Section 5 shall be paid by Parkway.  In addition, on the
Second Closing Date, the Company (without contribution by Chicago LLC, IPL
and/or Chicago Inc. or deduction from the Second Purchase Price) shall
distribute to Parkway an amount equal to 10% of $400,000 (i.e., $40,000), on
account of Parkway's promoted interest under Section 3.03(a)(3) of the Property
Operating Agreement.

                    (c)        Each of Parkway, IPL and Chicago Inc. hereby
agrees that, to the extent allowed by applicable law, its obligations under this
Section 5 shall be primary, absolute, and unconditional, irrespective of and
unaffected by the nature and condition of the Property as of the Second Closing,
the suitability of the Property for any and all activities and uses which
Parkway or its Affiliates may elect to conduct thereon, the existence, nature
and extent of any lease, right to possession or use, or any other matter
affecting title to the Property, whether the use or operation of the Property
complies with any and all laws, ordinances or regulations of the any government
or other regulatory body, the rents, profits or other income to be derived from
the

--------------------------------------------------------------------------------

Property, or any other matter or thing regarding the Property.  NOTWITHSTANDING
ANYTHING TO THE CONTRARY HEREIN OR ELSEWHERE, EXCEPT AS SET FORTH IN CLAUSE
(b)(2) ABOVE, THE CONVEYANCE UNDER THIS SECTION 5 SHALL BE ON A COMPLETELY
"AS-IS," "WHERE-IS" BASIS.  NEITHER IPL NOR CHICAGO INC. HAS MADE, DOES MAKE AND
EACH SPECIFICALLY NEGATES AND DISCLAIMS ANY REPRESENTATIONS, WARRANTIES,
PROMISES, COVENANTS, AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER
WHATSOEVER, WHETHER EXPRESS OR IMPLIED, ORAL OR WRITTEN, PAST, PRESENT OR
FUTURE, OF, AS TO, CONCERNING OR WITH RESPECT TO THE PROPERTY.

                    (d)        At the Second Closing and upon the receipt of the
funds as described in clause (1) above John Fraser, Jonathan Dracos and Edward
Lord (or any other person appointed by Chicago LLC) shall be deemed to have
resigned as members of the Manager's Investment Committee (as defined in the
Property Operating Agreement).

                    (e)        If Parkway does not obtain the Section 5 Consent
on or before April 1, 2005 (TIME BEING OF THE ESSENCE), then, in any such event,
the terms of clauses (a), (b) and (d) of this Section 5 shall terminate and be
of no further force or effect and neither IPL nor Chicago Inc. shall have any
obligation whatsoever to transfer, and Parkway shall have no right whatsoever to
acquire, IPL's or Chicago Inc.'s remaining membership interests in Chicago LLC.

                    (f)         Supplementing any other indemnity set forth in,
or contemplated by, this Agreement, Parkway hereby covenants and agrees to
indemnify, defend and hold Chicago Inc. and IPL (together with each of its
partners, officers, directors, agents, contractors, employees and
representatives and any partner of the foregoing) harmless from and against all
claims, demands, causes of actions, judgments, damages, costs and expenses
(including, without limitation, attorneys' fees and court costs), deficiencies,
settlements and investigations which relate to matters, actions or omissions
arising or occurring on or after the Second Closing Date, which arise out of or
are based upon (a) any accident, injury, death or damage whatsoever caused to
any person or entity or loss of property occurring in or about the Property or
any part thereof, or on any other property connected with or adjacent thereto,
(b) the ownership, operation, management, business and/or affairs of the
Company, the Company Manager, Chicago LLC and/or the Property, and/or (c) any
claim by the Mortgage Lender (or any other person) related to the Mortgage Loan.

                    (g)        Parkway shall use its best efforts to obtain the
Section 5 Consent on or before April 1, 2005 from the Mortgage Lender and/or any
required rating agency.  On or before the Second Closing, Parkway shall pay all
costs, expenses (including, without limitation, attorneys' fees and expenses)
and fees associated with obtaining the Section 5 Consent.

                    (h)        If the Second Closing occurs, then, tax
allocations shall be determined as though the tax year of Chicago LLC ended on
the Second Closing Date.

        6.         (a) Chicago Inc. hereby represents and warrants to Parkway
the following:  (i) Chicago Inc. is a corporation duly organized, validly
existing and in good standing in the state of Delaware, (ii) the execution and
delivery of this Agreement and the performance of Chicago Inc.'s obligations
hereunder have been duly authorized by all necessary action on the part of
Chicago Inc.; (iii) Chicago Inc. has good title in and to the

--------------------------------------------------------------------------------

Membership Interests, free and clear of any and all liens, charges and
encumbrances other than the loan documents evidencing and/or securing the
Mortgage Loan, the Property Operating Agreement, the Shareholders Agreement
and/or the Chicago LLC Operating Agreement (a true, correct and complete copy of
which is annexed hereto and made a part hereof as Exhibit B); and (iv) Chicago
Inc. has not contacted or agreed to pay any agent, broker or other similar party
with respect to the transactions contemplated by this Agreement.

                    (b)        Parkway hereby represents and warrants to Chicago
Inc. the following:  (i) Parkway is a limited partnership duly organized,
validly existing and in good standing in the state of Delaware, (ii) the
execution and delivery of this Agreement and the performance of Parkway's
obligations hereunder have been duly authorized by all necessary action on the
part of Parkway; and (iii) Parkway has not contacted or agreed to pay any agent,
broker or other similar party with respect to the transactions contemplated by
this Agreement.

                    (c)        PARKWAY HEREBY EXPRESSLY ACKNOWLEDGES THAT IT HAS
INSPECTED AND EXAMINED THE PROPERTY TO THE EXTENT DEEMED NECESSARY BY PARKWAY IN
ORDER TO ENABLE PARKWAY TO EVALUATE THE PURCHASE OF THE MEMBERSHIP INTERESTS. 
PARKWAY REPRESENTS THAT IT IS A KNOWLEDGEABLE PURCHASER OF REAL ESTATE AND
RETAIL OFFICE PROPERTIES AND THAT, EXCEPT AS SET FORTH IN THIS AGREEMENT, IT IS
RELYING SOLELY ON ITS OWN EXPERTISE AND THAT OF PARKWAY'S CONSULTANTS, AND THAT
PARKWAY HAS CONDUCTED SUCH INSPECTIONS AND INVESTIGATIONS OF THE PROPERTY,
INCLUDING, BUT NOT LIMITED TO, THE PHYSICAL AND ENVIRONMENTAL CONDITIONS
THEREOF.  PARKWAY FURTHER ACKNOWLEDGES AND AGREES THAT PARKWAY IS ACQUIRING THE
MEMBERSHIP INTERESTS ON AN "AS IS, WHERE IS" BASIS WITHOUT REPRESENTATIONS OR
WARRANTIES OTHER THAN THOSE SET FORTH HEREIN.

        7.         The parties hereto acknowledge and agree that (a) for taxes
purposes the transfer of the Membership Interests will cause a termination and
dissolution of the Company and Chicago LLC pursuant to the Property Operating
Agreement, the Chicago LLC Operating Agreement and Section 708 of the Internal
Revenue Code of 1986, as amended, (b) tax allocations by the Company and Chicago
LLC to Parkway, Chicago LLC, the Company Manager, Chicago Inc. and IPL,
respectively, will be determined as though the tax year of the Company and
Chicago LLC ended on the Initial Closing Date hereof, and (c) the Company and
Chicago LLC shall provide Parkway, Chicago LLC, the Company Manager, Chicago
Inc. and IPL, respectively, with all required tax information (including Form
K-1's) as soon as practicable, and in no event later than the time that such
information is required to be provided to Parkway, Chicago LLC, the Company
Manager, Chicago Inc. and IPL, respectively, (determined without regard to any
extensions other than extensions to which such person consents).

        8.         (a) All notices, demands, requests, consents and waivers
under this Agreement shall be in writing, shall refer to this Agreement and
shall be (i) delivered personally, (ii) sent by registered or certified mail,
postage prepaid, return receipt requested, (iii) sent by a nationally recognized
overnight courier, or (iv) sent by telecopier, with written confirmation of the
receipt of such telecopy, addressed as set forth below. If delivered personally,

--------------------------------------------------------------------------------

any notice shall be deemed to have been given on the first (1st) business day on
or after the date delivered or refused. If mailed, any notice shall be deemed to
have been given on the earlier to occur of the first (1st) business day on or
after the date of delivery or the third (3rd) business day after such notice has
been deposited in the U.S. mail in accordance with this Section 8(a).  If sent
by overnight courier, any notice shall be deemed to have been given on the first
(1st) business day on or after the date following the date such notice was
delivered to or picked up by the courier. If sent by telecopier, any notice
shall be deemed to have been given (I) on the first (1st) business day on or
after the date sent, if confirmation of receipt hereof is given on or before
5:00 p.m. (New York City time), or (II) on the next business day, if
confirmation of receipt thereof is given after 5:00 p.m. (New York City time).
Copies of all notices shall be given in accordance with the above as follows:

                    If to Parkway, to:          Parkway Properties LP
                                                        One Jackson Place, Suite
1000
                                                        Jackson, MS 39201
                                                        Attention:  Marshall
Loeb and James Ingram
                                                        Telephone:  (601)
948-4091
                                                        Facsimile:  (601)
949-4077

                    With a copy to:             Forman Perry Watkins Krutz &
Tardy, PLLC
                                                        One Jackson Place, Suite
1200
                                                        188 East Capitol Street
                                                        Jackson, MS 39201
                                                        Attention:  Steven M.
Hendrix
                                                        Telephone:  (601)
960-8600
                                                        Facsimile:  (601)
960-8609

                    If to Chicago Inc.

                    or IPL, to:                    Investcorp International,
Inc.
                                                        280 Park Avenue, 37th
Floor
                                                        New York, NY 10017
                                                        Attention:  F. Jonathan
Dracos
                                                        Telephone:  (212)
599-4700
                                                        Facsimile:  (212)
983-7073

 

                    With a copy to:             Gibson, Dunn & Crutcher LLP

                                                        200 Park Avenue

                                                        New York, NY  10016

                                                        Attention:  David J.
Furman, Esq.

                                                        Telephone:  (212)
351-3992

                                                        Facsimile:  (212)
351-4035

Any party hereto may change its address for notice by giving three days prior
written notice thereof to the other party.

--------------------------------------------------------------------------------

                    (b)        Any counsel designated above or any replacement
counsel which may be designated respectively by either party or such counsel by
written notice to the other party is hereby authorized to give notices hereunder
on behalf of its respective client.

        9.         Miscellaneous.

                    (a)        This Agreement shall be governed and construed in
accordance with the internal laws of the State of Delaware.

                    (b)        All of the terms, representations, warranties,
and other provisions of this Agreement shall survive and remain in effect after
the date hereof.

                    (c)        This Agreement shall inure to the benefit of the
transferees, successors, assigns, heirs, beneficiaries, executors,
administrators, partners, agents, employees, and representatives of each party;
provided, however, that Parkway may not assign its rights, obligations or
liabilities under Section 5 of this Agreement.

                    (d)        This Agreement may be executed in multiple
counterparts each of which may be deemed an original and shall become effective
when the separate counterparts have been exchanged among the parties.

                    (e)        Upon the written request of any party hereto,
from time to time, from and after the date hereof, the other parties shall do,
execute, acknowledge and deliver, at the sole cost and expense of the requesting
party, such further acts, deeds, conveyances, assignments, notices of assignment
or transfer and assurances as are reasonably necessary in order to better
assure, convey, grant, assign, transfer and confirm upon the requesting party
the rights now or hereafter intended to be granted under this Agreement or any
other instrument executed in connection with this Agreement; provided, however,
that no party shall be obligated to provide any further assurance that would
increase the liabilities or obligations of such party hereunder or reduce the
rights and benefits of such party hereunder.

(f)         This Agreement may not be amended or supplemented except in writing
executed by the party against whom enforcement is sought.

(g)        If any party hereto brings any action or suit against another party
hereto by reason of any breach of any of the agreements or provisions of this
Agreement, then, in such event, the prevailing party, as determined in such
action or suit, shall be entitled to have and recover from the other party or
parties all costs and expenses of such action or suit, including, without
limitation, reasonable attorneys' fees and expenses resulting therefrom; it
being understood and agreed that the determination of the prevailing party shall
be included in the matters which are the subject of such action or suit.

(h)        The parties hereto acknowledge that each party has reviewed this
Agreement and that the rule of construction to the effect that any ambiguities
are to be resolved against the drafting party shall not be employed in the
interpretation of this Agreement or any amendments hereto.  No provision of this
Agreement shall be deemed to have been waived by either party unless the waiver
is in writing and signed by that party.  No custom or practice which may evolve
between the parties hereto during the term of this Agreement shall be deemed or
construed to waive or lessen the right of either of the parties hereto to insist
upon strict compliance of the terms of this Agreement.

--------------------------------------------------------------------------------

(i)         Unless otherwise required by applicable law upon the advice of legal
counsel (in which case, the disclosing party shall first consult with the other
party prior to making any disclosure), Parkway, PPI, Chicago Inc., IPL, Chicago
LLC, the Company and the Company Manager shall not make any disclosure (whether
or not in response to any inquiry) of the subject matter of this Agreement or
the transactions contemplated hereby, including any public announcement or press
release regarding the subject matter of this Agreement or the transactions
contemplated thereby unless approved by Parkway and IPL, prior to release.

--------------------------------------------------------------------------------

        IN WITNESS WHEREOF, this Agreement has been duly executed by the parties
hereof as of the date first set forth above.

                                                                               
PARKWAY:

 

                                                                               
PARKWAY PROPERTIES LP
                                                                               
a Delaware limited liability partnership

                                                                               
By:       Parkway Properties General Partners, Inc.,
                                                                               
            a Delaware corporation, its General Partner

 

        By:                                                      

        Name: 

        Title:    

        By:                                                      

        Name: 

        Title:    

                                                                               
CHICAGO INC.:

                                                                               
233 CHICAGOINVEST, INC.

                                                                               
By:                                                                  

        Name:

        Title:

--------------------------------------------------------------------------------

CHICAGO OFFICEINVEST, LLC HEREBY ACCEPTS ALL OF THE TERMS, COVENANTS AND
CONDITIONS OF THIS AGREEMENT AND AGREES TO EXECUTE AND/OR DELIVER ALL DOCUMENTS
AND INSTRUMENTS REQUIRED OF CHICAGO OFFICEINVEST, LLC AS CONTEMPLATED BY THIS
AGREEMENT:

                                                                               
CHICAGO OFFICEINVEST, LLC

                                                                               
By:                                                                  

        Name:

        Title:

--------------------------------------------------------------------------------

INVESTCORP PROPERTIES LIMITED HEREBY ACCEPTS ALL OF THE TERMS, COVENANTS AND
CONDITIONS OF SECTION 5 OF THIS AGREEMENT AND AGREES TO EXECUTE AND/OR DELIVER
ALL DOCUMENTS AND INSTRUMENTS REQUIRED OF INVESTCORP PROPERTIES LIMITED AS
CONTEMPLATED BY SECTION 5 OF THIS AGREEMENT:

                                                                               
INVESTCORP PROPERTIES LIMITED

                                                                               
By:                                                                  

        Name:

        Title:

--------------------------------------------------------------------------------

EXHIBIT A

FORM OF ASSIGNMENT OF MEMBERSHIP INTERESTS

        This ASSIGNMENT OF MEMBERSHIP INTERESTS is executed and delivered as of
January__, 2005, by 233 CHICAGOINVEST, INC. ("Assignor"), a Delaware
corporation, in favor of PARKWAY PROPERTIES LP ("Assignee"), a Delaware limited
partnership.

WITNESSETH

        WHEREAS, pursuant to that certain Agreement and Amendment, dated as of
January __, 2005, by and between Assignor and Assignee (the "Agreement"),
Assignor has, among other things, agreed to grant, convey, sell, assign and
transfer to Assignee ninety percent (90%) of the membership interests in Chicago
OfficeInvest, LLC, a Delaware limited liability company (the "Company"),
including, without limitation, Assignor's right to profits, losses and
distributions after the date hereof (the "Membership Interests"), so that
following the consummation of this assignment of such Membership Interests from
Assignor to Assignee, Assignee shall own ninety percent (90%) of the membership
interests in the Company.

        NOW, THEREFORE, for and in consideration of certain good and valuable
consideration set forth in the Agreement, the receipt and sufficiency of which
is hereby acknowledged, Assignor does hereby grant, convey, sell, assign and
transfer unto Assignee, its legal representatives, successors, successors in
title and assigns, the Membership Interests.

        To have and to hold the aforesaid Membership Interests unto Assignee,
and the legal representatives, successors, successors in title and assigns of
Assignee, forever.

        IN WITNESS WHEREOF, Assignor has signed and delivered this instrument as
of the date first above written.

                                                                               
ASSIGNOR:

 

                                                                               
233 CHICAGOINVEST, INC.

                                                                               
By:                                                                  

        Name:

        Title:

--------------------------------------------------------------------------------

EXHIBIT A-1

FIRPTA CERTIFICATE

--------------------------------------------------------------------------------

EXHIBIT B

OPERATING AGREEMENT OF
CHICAGO OFFICEINVEST, LLC

--------------------------------------------------------------------------------

EXHIBIT C

PARKWAY RELEASE

        Reference is made to that certain Agreement and Amendment, dated as of
January ___, 2005 (the "Agreement"), by and between among Parkway Properties,
LP, a Delaware limited partnership ("Parkway") and 223 ChicagoInvest, Inc., a
Delaware corporation ("Chicago Inc.").  Capitalized terms used in this Agreement
but not defined herein shall have the respective meanings set forth in the
Agreement.

        Parkway, on behalf of itself, successors, assigns and affiliates (and
person claiming by, through or under any of them) (collectively, "Parkway
Releasors") (i) acknowledges that it will receive benefits through the
consummation of the transactions contemplated by this Agreement, and (ii) does
hereby remise, release and forever discharge Chicago Inc. and IPL and their
successors, assigns, officers, directors, agents, employees and counsel, from
all manner of actions, causes of action, suits, debts, sums of money, bonds,
bills, contracts, controversies, agreements, promises, damages, judgments,
claims and demands whatsoever, at law or in equity, which Parkway Releasors or
their respective successors or assigns ever had, now has or hereafter can, shall
or may have, for, upon or by reason of any interest in the Company, the Company
Manager, Chicago LLC and/or the Property, or any agreement, instrument, matter,
cause or thing whatsoever (including, without limitation, the Property Operating
Agreement, the Chicago LLC Operating Agreement and the Shareholders Agreement
(as defined in the Property Operating Agreement) and/or any document or
instrument evidencing or securing the Mortgage Loan), provided that the terms of
this Release shall not release Chicago Inc. or IPL, as the case may be, from any
of the liabilities and/or obligations set forth in Section 5(h), Section 7,
Section 9(e) and/or Section 9(i) of the Agreement.

                                
                                                   PARKWAY PROPERTIES LP

                                                                                   
a Delaware limited liability partnership

 

                                                                                   
By:    Parkway Properties General Partners, Inc.,

                                                                                            
a Delaware corporation, its General Partner

 

                                                                                            
By:                                                      

                                                                                                         
Name:     

                                                                                                         
Title:    

             

                                                                                             
By:                                                      

                                                                                                          
Name: 

                                                                                                          
Title:    

                                 

--------------------------------------------------------------------------------

EXHIBIT C-1

INVESTCORP RELEASE

          Reference is made to that certain Agreement and Amendment, dated as of
January ___, 2005 (the "Agreement"), by and between among Parkway Properties,
LP, a Delaware limited partnership ("Parkway") and 223 ChicagoInvest, Inc., a
Delaware corporation ("Chicago Inc.").  Capitalized terms used in this Agreement
but not defined herein shall have the respective meanings set forth in the
Agreement.

IPL and Chicago Inc., each on behalf of itself, successors, assigns and
affiliates (and person claiming by, through or under any of them) (collectively,
"Investcorp Releasors") (i) acknowledges that it will receive benefits through
the consummation of the transactions contemplated by this Agreement, and (ii)
does hereby remise, release and forever discharge Parkway and its successors,
assigns, officers, directors, agents, employees and counsel, from all manner of
actions, causes of action, suits, debts, sums of money, bonds, bills, contracts,
controversies, agreements, promises, damages, judgments, claims and demands
whatsoever, at law or in equity, which Investcorp Releasors or their respective
successors or assigns ever had, now has or hereafter can, shall or may have,
for, upon or by reason of any interest in the Company, the Company Manager,
Chicago LLC and/or the Property, or any agreement, instrument, matter, cause or
thing whatsoever (including, without limitation, the Property Operating
Agreement, the Chicago LLC Operating Agreement and the Shareholders Agreement
and/or any document or instrument evidencing or securing the Mortgage Loan),
provided that the terms of this Release shall not release Parkway from any of
the liabilities and/or obligations set forth in Section 5(f), Section 5(h),
Section 7, Section 9(e) and/or Section 9(i) of the Agreement.

                                                                               
233 CHICAGOINVEST, INC.

 

 

                                                                               
By:                                                                 

                                                                                    
Name:

                                                                                    
Title:

                                                                               
INVESTCORP PROPERTIES LIMITED

 

                                                                               
By:                                                                 

                                                                                    
Name:

                                                                                    
Title:

 

--------------------------------------------------------------------------------

SCHEDULE 1

 

CLOSING STATEMENT