<PAGE> 1
================================================================================
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): March 26, 1996
IRT PROPERTY COMPANY
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C> <C>
GEORGIA 1-7859 58-1366611
(STATE OR OTHER JURISDICTION (COMMISSION FILE NUMBER) (IRS EMPLOYER IDENTIFICATION NO.)
OF INCORPORATION)
</TABLE>
200 GALLERIA PARKWAY, SUITE 1400
ATLANTA, GEORGIA 30339
(Address of Principal Executive Offices)
(770) 955-4406
(Registrant's telephone number, including area code)
----------------
(Former Name or Former Address, if Changed Since Last Report)
================================================================================
<PAGE> 2
ITEM 5. OTHER EVENTS.
IRT Property Company (the "Company") has completed the offering of $50.0
million of 7.45% Notes due April 1, 2001 (the "Notes"). The offering of the
Notes was made pursuant to a Prospectus Supplement dated March 21, 1996
relating to the Prospectus dated November 9, 1995 filed with the Company's
Shelf Registration Statement No. 33-63523 on Form S-3.
The Notes will pay interest semi-annually on April 1 and October 1,
commencing October 1, 1996. The Notes will be senior unsecured obligations of
the Company and will rank equally with the Company's other unsecured and
unsubordinated indebtedness. The Notes will be effectively subordinated to
mortgages and other secured indebtedness of the Company and to indebtedness and
other liabilities of the Company's subsidiaries. The Notes will be senior to
the Company's 7.3% Convertible Subordinated Debentures due 2003.
The net proceeds from the sale of the Notes are estimated to be
approximately $49.4 million. These proceeds will be used primarily to repay
borrowings under the Company's $100 million revolving credit facility which
totaled $48 million as of March 21, 1996 ($36 million as of December 31, 1995).
Any excess proceeds will be used for general corporate purposes.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
The Company is filing with this current report copies of the following
documents in connection with the offering of Notes:
<TABLE>
<CAPTION>
Exhibit Description
- ------- -------------------------------
<S> <C>
1 Underwriting Agreement
4 First Supplemental Indenture
dated as of March 26, 1996
between IRT Property Company
and SunTrust Bank, Atlanta
5 Opinion as to Legality of Notes
8 Tax Opinion
23 Consent of Arthur Andersen LLP
</TABLE>
<PAGE> 3
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.
IRT Property Company
-------------------------
(Registrant)
Date: March 26, 1996 By /s/ Mary M. Thomas
-------------------------
Mary M. Thomas
Executive Vice President and
Chief Financial Officer
<PAGE> 4
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
-----------
EXHIBITS
TO
CURRENT REPORT
ON
FORM 8-K
DATED MARCH 26, 1996
IRT PROPERTY COMPANY
================================================================================
<PAGE> 5
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION
- ------- -----------
<S> <C>
1 Underwriting Agreement
4 First Supplemental Indenture
dated as of March 26, 1996
between IRT Property Company
and SunTrust Bank, Atlanta
5 Opinion as to Legality of Notes
8 Tax Opinion
23 Consent of Arthur Andersen LLP
</TABLE>
<PAGE> 1
EXHIBIT 1
UNDERWRITING AGREEMENT
<PAGE> 2
IRT PROPERTY COMPANY
7.45% Notes due 2001
Underwriting Agreement
March 21, 1996
ALEX. BROWN & SONS INCORPORATED
135 East Baltimore Street
Baltimore, Maryland 21202
Dear Sirs:
IRT Property Company, a Georgia corporation (the "Company"), proposes to
issue and sell to Alex. Brown & Sons Incorporated (the "Underwriter"), the
principal amount of its debt securities identified in Schedule I hereto (the
"Securities"), to be issued under the indenture specified in Schedule I hereto
(the "Indenture") between the Company and the Trustee identified in such
Schedule (the "Trustee").
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of the
Securities Act of 1933, as amended, and the rules and regulations of the
Commission thereunder (collectively, the "Securities Act"), a registration
statement (the file number of which is set forth in Schedule I hereto) on Form
S-3, relating to certain debt securities and common stock (the "Shelf
Securities") to be issued from time to time by the Company. The Company also
has filed with, or proposes to file with, the Commission pursuant to Rule 424
under the Securities Act a prospectus supplement specifically relating to the
Securities. The registration statement as amended to the date of this Agreement
is hereinafter referred to as the "Registration Statement" and the related
prospectus covering the Shelf Securities in the form included in the
Registration Statement at the time it was declared effective is hereinafter
referred to as the "Basic Prospectus." The Basic Prospectus as supplemented by
the prospectus supplement specifically relating to the Securities in the form
first used to confirm sales of the Securities is hereinafter referred to as the
"Prospectus." Any reference in this Agreement to the Registration Statement,
the Basic Prospectus, any preliminary form of Prospectus (a "preliminary
prospectus") previously filed with the Commission pursuant to Rule 424 or the
Prospectus shall be deemed to refer to and include the documents incorporated
by reference therein pursuant to Item 12 of Form S-3 under the Securities Act
which were filed under the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder (collectively, the "Exchange
Act") on or before the date of this Agreement or the date of the Basic
Prospectus, any preliminary prospectus or the Prospectus, as the case may be;
and any reference to "amend," "amendment" or "supplement" with respect to the
Registration Statement, the Basic Prospectus, any prelimi-
<PAGE> 3
nary prospectus or the Prospectus shall be deemed to refer to and include any
documents filed under the Exchange Act after the date of this Agreement, or the
date of the Basic Prospectus, any preliminary prospectus or the Prospectus, as
the case may be, which are deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriter as follows:
1. The Company agrees to issue and sell the Securities to the Underwriter
as hereinafter provided, and the Underwriter, on the basis of the
representations and warranties herein contained, but subject to the conditions
hereinafter stated, agrees to purchase from the Company the principal amount of
Securities set forth in Schedule I hereto at the purchase price set forth in
Schedule I hereto plus accrued interest, if any, from the date specified in
Schedule I hereto to the date of payment and delivery.
2. The Company understands that the Underwriter intends (i) to make a
public offering of their respective portions of the Securities and (ii)
initially to offer the Securities upon the terms set forth in the Prospectus.
3. Payment for the Securities shall be made to the Company or to its order
in immediately available funds on the date and at the time and place set forth
in Schedule I hereto (or at such other time and place on the same or such other
date, not later than the third Business Day thereafter, as the Underwriter and
the Company may agree in writing). Such payment will be made upon delivery to
the Underwriter of the Securities registered in such names and in such
denominations as the Underwriter shall request not less than two full Business
Days prior to the date of delivery, with any transfer taxes payable in
connection with transfer to the Underwriter duly paid by the Company. As used
herein, the term "Business Day" means any day other than a day on which banks
are permitted or required to be closed in New York City or in Atlanta, Georgia.
The time and date of such payment and delivery with respect to the Securities
are referred to herein as the "Closing Date." The Securities will be delivered
through book-entry facilities of The Depository Trust Company ("DTC"). The
certificate or certificates for the Securities will be made available for
inspection and packaging by the Underwriter by 1:00 P.M. on the Business Day
prior to the Closing Date at such place in New York City as the Underwriter,
DTC and the Company shall agree.
4. The Company represents and warrants to the Underwriter that:
(a) the Registration Statement has been declared effective by the
Commission under the Securities Act; no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceeding for that
purpose has been instituted or, to the knowledge of the Company, threatened by
the Commission; and the Registration Statement and Prospectus (as amended or
supplemented), comply, or will comply, as the case may be, in all material
respects with the Securities Act and the Trust Indenture Act of 1939, as
amended, and the rules and regulations of the Commission thereunder
(collectively, the "Trust Indenture Act"), and do not and will not, as of the
applicable effective date as to the Registration Statement and
2
<PAGE> 4
any amendment thereto and as of the date of the Prospectus and any amendment or
supplement thereto, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make the
statements therein, in the case of the Prospectus, in the light of the
circumstances under which they were made, not misleading, and the Prospectus,
as amended or supplemented at the Closing Date, if applicable, will not contain
any untrue statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; except that the foregoing
representations and warranties shall not apply to (i) that part of the
Registration Statement which constitutes the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Trustee, and (ii)
statements or omissions in the Registration Statement or the Prospectus made in
reliance upon and in conformity with information relating to the Underwriter
furnished to the Company in writing by the Underwriter expressly for use
therein;
(b) the documents incorporated by reference in the Prospectus, when they
were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act, and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and any further documents so filed
and incorporated by reference in the Prospectus, when such documents are filed
with the Commission will conform in all material respects to the requirements
of the Exchange Act, as applicable, and will not contain an untrue statement of
a material fact or omit to state a material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(c) the historical financial statements and the related notes thereto,
included or incorporated by reference in the Registration Statement and the
Prospectus, comply in all material respects with the requirements of the
Securities Act and the Exchange Act, as applicable and present fairly the
consolidated financial position of the Company and its consolidated
subsidiaries as of the dates indicated and the results of its operations and
the changes in its cash flows for the periods specified; the financial
statements with respect to the properties acquired or to be acquired by the
Company and its consolidated subsidiaries, together with related notes and
schedules as set forth or incorporated by reference in the Registration
Statement or the Prospectus, present fairly the financial position and the
results of operations of such properties at the indicated dates and for the
indicated periods; the foregoing financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
consistent basis, and the supporting schedules included or incorporated by
reference in the Registration Statement or the Prospectus present fairly the
information required to be stated therein; the summary financial and
statistical data included or incorporated by reference in the Registration
Statement or the Prospectus present fairly the information shown therein and
have been compiled on a basis consistent with the financial statements
presented therein; the pro forma financial information, and the related notes
thereto, included or incorporated by reference in the Registration Statement
and the Prospectus has been prepared in all material respects in accordance
with the applicable requirements of the Securities
3
<PAGE> 5
Act and the Exchange Act, as applicable; and the assumptions used in preparing
such pro forma information are reasonable and the adjustments used therein are
appropriate to give effect to the transactions referred to therein; and the
other financial and statistical information and data set forth in the
Registration Statement and the Prospectus (and any amendment or supplement
thereto) are accurately presented in all material respects and prepared on a
basis consistent with the books and records of the Company and the Subsidiaries
(as defined below);
(d) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has not been any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the general affairs, business, prospects, management,
properties, financial position, shareholders' equity or results of operations
of the Company and its Subsidiaries, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus; and except as set forth or
contemplated in the Prospectus neither the Company nor any of its Subsidiaries
has entered into any transaction or agreement (other than in the ordinary
course of business) material to the Company and its Subsidiaries, taken as a
whole;
(e) the Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Georgia, with power
and authority (corporate or other) to own or lease its properties and conduct
its business as presently conducted and as described in the Prospectus, and has
been duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in which it
owns or leases properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in good
standing would not (1) have a material adverse effect on the condition,
financial or otherwise, the earnings, business affairs, prospects, properties,
shareholders' equity or results of operations of the Company and its
consolidated Subsidiaries, taken as a whole, (2) adversely affect the issuance,
validity, or enforceability of the Securities or the enforceability of the
Indenture or (3) adversely affect the consummation of any of the transactions
contemplated by this Agreement (each of (1), (2) and (3) above, a "Material
Adverse Effect");
(f) except for investments in its Subsidiaries or in securities or
partnership or joint venture interests as described in the Registration
Statement or Prospectus, the Company has no equity or other interest in, or
rights to acquire, an equity or other interest in any corporation, partnership,
trust or other entity; each of the Company's subsidiaries (within the meaning
of Regulation S-X under the Securities Act) is identified on Schedule II hereto
(the "Subsidiaries") and has been duly organized and is validly existing as a
corporation or limited partnership, as the case may be, in good standing under
the laws of their states of organization, with power and authority (corporate
or other) to own or lease its properties and conduct its business as presently
conducted and as described in the Prospectus, and has been duly qualified as a
foreign corporation or limited partnership, as the case may be, for the
transaction of business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any business,
so as to require such qualification, other than where the failure to be so
qualified or in good standing would not have a Material Adverse Effect; except
4
<PAGE> 6
for investments in securities as described in the Registration Statement or
Prospectus, the Subsidiaries have no equity or other interest in, or rights to
acquire, an equity or other interest in any corporation, partnership, trust or
other entity; and all of the outstanding shares of capital stock or partnership
interests of each Subsidiary have been duly authorized and validly issued, are
fully-paid and non-assessable, and are owned by the Company, directly or
indirectly through another Subsidiary, free and clear of all liens,
encumbrances, security interests and claims;
(g) this Agreement and the Indenture have been duly authorized, executed
and delivered by the Company and constitute the valid and legally binding
obligations of the Company enforceable in accordance with their terms, except
as rights to indemnity and contribution hereunder may be limited by applicable
law;
(h) the Securities have been duly authorized, and, when issued,
authenticated and delivered pursuant to this Agreement and the Indenture will
have been duly and validly executed, authenticated, issued and delivered and
will constitute valid and binding obligations of the Company entitled to the
benefits provided by the Indenture enforceable against the Company in
accordance with their terms; the Indenture has been duly authorized and
qualified under the Trust Indenture Act and constitutes a valid and binding
instrument of the Company enforceable against the Company in accordance with
its terms; and the Securities and the Indenture will conform to the statements
relating thereto contained in the Prospectus;
(i) neither the Company nor any of its Subsidiaries is, nor with the
giving of notice or lapse of time or both would be, in violation of or in
default under (1) their respective Articles of Incorporation or By-Laws or (2)
any indenture, mortgage, deed of trust, loan agreement, partnership agreement
or other agreement or instrument or obligation to which the Company or any of
its Subsidiaries is a party or by which they or any of their properties are
bound, except, with respect to this clause (2), for violations and defaults
which individually or in the aggregate would not have a Material Adverse
Effect; the issue and sale of the Securities and the performance by the Company
of all of the provisions of its obligations under the Securities, the Indenture
and this Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of the terms
or provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement, partnership agreement or other agreement or
instrument to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound or to which any of the
property or assets of the Company or any of its Subsidiaries is subject, nor
will any such action result in any violation of the provisions of the Articles
of Incorporation or the By-Laws of the Company or any applicable law or statute
or any order, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its properties; and no consent,
approval, authorization, order, registration or qualification of or with any
such court or governmental agency or body is required for the issue and sale of
the Securities or the consummation by the Company of the transactions
contemplated by this Agreement or the Indenture, except such consents,
approvals, authorizations, orders, registrations or qualifications as have been
obtained under the Securities Act, the Trust Inden-
5
<PAGE> 7
ture Act and as may be required under state securities or Blue Sky Laws in
connection with the purchase and distribution of the Securities by the
Underwriter;
(j) other than as set forth or contemplated in the Prospectus, there are
no legal or governmental proceedings pending or, to the knowledge of the
Company, threatened to which the Company or any of its Subsidiaries is or may
be a party or to which any property of the Company or any of its Subsidiaries
is or may be the subject which, if determined adversely to the Company, could
individually or in the aggregate reasonably be expected to have a Material
Adverse Effect, and, to the best of the Company's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others; and there are no contracts or other documents of a
character required to be filed as an exhibit to the Registration Statement or
required to be described in the Registration Statement or the Prospectus which
are not filed or described as required; and the descriptions of the terms of
all such contracts and documents contained or incorporated by reference in the
Registration Statement or Prospectus are complete and correct in all material
respects;
(k) the Company's authorized, issued and outstanding capitalization is set
forth in the Prospectus; and all of the issued shares of capital stock of the
Company have been duly and validly authorized and issued, are fully paid and
non-assessable;
(l) the Company and its Subsidiaries have good and marketable title in fee
simple to all real property described in the Prospectus as owned by them and
good and marketable title to all personal property owned by them, in each case
free and clear of all liens, encumbrances and defects except such as are
described in the Prospectus or such as do not materially affect the value of
such property and do not interfere with the use made and proposed to be made of
such property by the Company and its Subsidiaries; and any real property and
buildings held under lease by the Company and its Subsidiaries and described in
the Prospectus are held by them under valid and subsisting leases with such
exceptions as are not material and do not interfere with the use made and
proposed to be made of such property and buildings by the Company and its
Subsidiaries;
(m) the Company has filed all Federal, State and foreign income tax
returns which have been required to be filed and have paid all taxes indicated
by said returns and all assessments received by it to the extent that such
taxes have become due and are not being contested in good faith;
(n) Arthur Andersen LLP, who have reported upon the audited financial
statements of the Company and its consolidated subsidiaries as of December 31,
1995 and 1994 and for the years in the three-year period ended December 31,
1995 included or incorporated by reference in the Registration Statement, are
independent public accountants as required by the Securities Act;
(o) with respect to all tax periods regarding which the Internal Revenue
Service is or will be entitled to assert any claim, the Company has met the
requirements for qualification
6
<PAGE> 8
as a real estate investment trust under Sections 856 through 860 of the
Internal Revenue Code, as amended, and the Company's present and contemplated
operations, assets and income continue to meet such requirements; and the
Company is not an open-end investment company, unit investment trust,
closed-end investment company or face-amount certificate company that is or is
required to be registered under Section 8 of the Investment Company Act of
1940, as amended (the "Investment Company Act");
(p) the conditions for the use of a registration statement on Form S-3 set
forth in the General Instructions on Form S-3 have been satisfied and the
Company is entitled to use such form for transactions contemplated herein;
(q) each of the Company and its Subsidiaries owns, possesses or has
obtained all licenses, permits, certificates, consents, orders, approvals and
other authorizations from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities (including foreign
regulatory agencies), all self-regulatory organizations and all courts and
other tribunals, domestic or foreign, necessary to own or lease, as the case
may be, and to operate its properties and to carry on its business as conducted
as of the date hereof, except in each case where the failure to obtain such
licenses, permits, certificates, consents, orders, approvals and other
authorizations, or to make such declarations and filings, would not,
individually or in the aggregate, have a Material Adverse Effect, and none of
the Company or any of its Subsidiaries has received any notice of any
proceeding relating to revocation or modification of any such license, permit,
certificate, consent, order, approval or other authorization, except as
described in the Registration Statement and the Prospectus and except, in each
case, where such revocation or modification would not, individually or in the
aggregate, have a Material Adverse Effect; and the Company and each of its
Subsidiaries are in compliance with all laws, rules and regulations
relating to the conduct of their respective businesses as conducted as of the
date hereof, except where noncompliance with such laws or regulations would
not, individually or in the aggregate, have a Material Adverse Effect;
(r) except as disclosed in the Prospectus, the Company and its
Subsidiaries (i) are in compliance with any and all applicable foreign,
federal, state and local laws and regulations relating to the protection of
human health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants ("Environmental Laws"), (ii) have received
all permits, licenses or other approvals required of them under applicable
Environmental Laws to conduct their business, (iii) are in compliance with all
terms and conditions of any such permit, license or approval and (iv) have no
knowledge of the unlawful presence of any hazardous substances, hazardous
materials, toxic substances or waste materials (collectively, "Hazardous
Materials") on any of the properties owned by them, or of any unlawful spills,
releases, discharges or disposal of such Hazardous Materials that have occurred
or are presently occurring from such properties as a result of any construction
on or operation and use of such properties, except where such noncompliance
with Environmental Laws, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals or unlawful presence of Hazardous Materials or occurrence
would not, singly or in the aggregate, have a Material Adverse Effect;
7
<PAGE> 9
(s) the mortgages and deeds of trust encumbering the properties and assets
described in the Prospectus are not convertible and neither the Company nor any
of its respective Subsidiaries holds a participating interest therein and such
mortgages and deeds of trust are not cross-defaulted or cross-collateralized to
any property not owned by the Company or any of its Subsidiaries;
(t) subsequent to the respective dates as of which information is given in
the Prospectus, (i) the Company has not purchased any of its outstanding shares
of common stock, nor declared, paid or otherwise made any dividend or
distribution of any kind on its shares of common stock other than regular
periodic dividends; and (ii) there has not been any material change in the
shares of common stock, short-term debt or long-term debt of the Company,
except as described in or contemplated by the Prospectus;
(u) the Company has not taken and will not take, directly or indirectly,
any action designed to, or that might be reasonably expected to, cause or
result in stabilization or manipulation of the price of the Securities, and the
Company has not distributed and has agreed not to distribute any prospectus or
other offering material in connection with the offering and sale of the
Securities other than the Prospectus or other material permitted by the
Securities Act; and
(v) to the best of the Company's knowledge, the Company does no business
with any person or affiliate located in Cuba within the meaning of Florida Rule
3E- 900.001.
5. The Company covenants and agrees with the Underwriter as follows:
(a) to file the Prospectus in a form approved by the Underwriter pursuant
to Rule 424 under the Securities Act not later than the Commission's close of
business on the second Business Day following the date of determination of the
offering price of the Securities;
(b) to deliver to the Underwriter and counsel for the Underwriter, at the
expense of the Company, a signed copy of the Registration Statement (as
originally filed) and each amendment thereto, in each case including exhibits
and documents incorporated by reference therein and, during the period
mentioned in paragraph (e) below, to the Underwriter as many copies of the
Prospectus (including all amendments and supplements thereto) and documents
incorporated by reference therein as the Underwriter may reasonably request,
when filed with the Commission;
(c) from the date hereof and prior to the Closing Date, to furnish to the
Underwriter a copy of any proposed amendment or supplement to the Registration
Statement or the Prospectus, for the Underwriter's review, and not to file any
such proposed amendment or supplement to which the Underwriter reasonably
objects;
(d) to file promptly all reports and any definitive proxy or information
statements required to be filed by the Company with the Commission pursuant to
Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long as the
delivery of a prospectus is required in connec-
8
<PAGE> 10
tion with the offering or sale of the Securities, and during such same period,
to advise the Underwriter and counsel for the Underwriter promptly, and to
confirm such advice in writing, (i) when any amendment to the Registration
Statement shall have become effective, (ii) of any request by the Commission
for any amendment to the Registration Statement or any amendment or supplement
to the Prospectus or for any additional information, (iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation or threatening of any proceeding for
that purpose, and (iv) of the receipt by the Company of any notification with
respect to any suspension of the qualification of the Securities for offer and
sale in any jurisdiction or the initiation or threatening of any proceeding for
such purpose; and to use its best efforts to prevent the issuance of any such
stop order or notification and, if issued, to obtain as soon as possible the
withdrawal thereof;
(e) if, during such period after the first date of the public offering of
the Securities as in the opinion of counsel for the Underwriter a prospectus
relating to the Securities is required by law to be delivered in connection
with sales by the Underwriter or a dealer, any event shall occur as a result of
which it is necessary to amend or supplement the Prospectus in order to make
the statements therein, in the light of the circumstances when the Prospectus
is delivered to a purchaser, not misleading, or if it is necessary to amend or
supplement the Prospectus to comply with law, forthwith to prepare and furnish,
at the expense of the Company, to the Underwriter and to the dealers (whose
names and addresses the Underwriter will furnish to the Company) to which
Securities may have been sold by the Underwriter on behalf of the Underwriter
and to any other dealers upon request, such amendments or supplements to the
Prospectus as may be necessary so that the statements in the Prospectus as so
amended or supplemented will not, in the light of the circumstances existing at
the time that the Prospectus is delivered to a purchaser, be misleading or so
that the Prospectus will comply with law;
(f) to endeavor to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as the Underwriter shall
reasonably request and to continue such qualification in effect so long as
reasonably required for distribution of the Securities and to pay all fees and
expenses (including fees and disbursements of counsel to the Underwriter)
reasonably incurred in connection with such qualification and in connection
with the determination of the eligibility of the Securities for investment
under the laws of such jurisdictions as the Underwriter may designate; provided
that the Company shall not be required to file a general consent to service of
process in any jurisdiction;
(g) to make generally available to its security holders and to the
Underwriter as soon as practicable but not later than 17 months after the
effective date of the Registration Statement (as defined in Rule 158(c)
promulgated under the Securities Act) an earnings statement covering a period
of at least twelve months beginning with the first fiscal quarter of the
Company occurring after the effective date of the Registration Statement, which
shall satisfy the provisions of Section 11(a) of the Securities Act and Rule
158 promulgated thereunder;
(h) so long as the Securities are outstanding, to furnish to the
Underwriter copies of all reports or other communications (financial or other)
furnished to holders of Securities, and
9
<PAGE> 11
copies of any reports and financial statements furnished to or filed with the
Commission or any national securities exchange;
(i) during the period beginning on the date hereof and continuing to and
including the Business Day following the Closing Date, not to offer, sell,
contract to sell or otherwise dispose of any debt securities of or guaranteed
by the Company which are substantially similar to the Securities without the
Underwriter's prior written consent;
(j) to use the net proceeds of the offering of the Securities in the
manner specified in the Prospectus under "Use of Proceeds";
(k) for a period of three years from the Closing Date, not to be or become
an open-end investment trust, unit investment trust, closed-end investment
company or face-amount certificate company that is or is required to be
registered under the Investment Company Act;
(l) to the best of its knowledge, the Company has complied and will
endeavor to comply with all provisions of Florida H.B. 1771, Section 1, para.
17,130 of the Florida Securities and Investor Act, and all regulations
thereunder relating to issuers doing business with Cuba;
(m) to pay all costs and expenses incident to the performance of its
obligations hereunder, including without limiting the generality of the
foregoing, all costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including any
expenses of the Trustee, (ii) incident to the preparation, printing and filing
under the Securities Act of the Registration Statement, the Prospectus and any
preliminary prospectus (including in each case all exhibits, amendments and
supplements thereto), (iii) incurred in connection with the registration or
qualification and determination of eligibility for investment of the Securities
under the laws of such jurisdictions as the Underwriter may designate
(including fees of counsel for the Underwriter and its disbursements), (iv) in
connection with the listing of the Securities on any stock exchange, (v)
related to any filing with National Association of Securities Dealers, Inc.,
(vi) in connection with the printing (including word processing and duplication
costs) and delivery of this Agreement, the Indenture, the Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and the
furnishing to the Underwriter and dealers of copies of the Registration
Statement and the Prospectus, including mailing and shipping, as herein
provided and (vii) payable to rating agencies in connection with the rating of
the Securities.
6. The several obligations of the Underwriter hereunder shall be subject
to the following conditions:
(a) the representations and warranties of the Company contained herein are
true and correct on and as of the Closing Date as if made on and as of the
Closing Date and the Company shall have complied with all agreements and all
conditions on its part to be performed or satisfied hereunder at or prior to
the Closing Date;
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(b) the Prospectus shall have been filed with the Commission pursuant to
Rule 424 within the applicable time period prescribed for such filing by the
rules and regulations under the Securities Act; no stop order suspending the
effectiveness of the Registration Statement shall be in effect, and no
proceedings for such purpose shall be pending before or threatened by the
Commission; and all requests for additional information on the part of the
Commission shall have been complied with to the satisfaction of the
Underwriter;
(c) subsequent to the execution and delivery of this Agreement and prior
to the Closing Date, there shall not have occurred any downgrading, nor shall
any notice have been given of (i) any intended or potential downgrading or (ii)
any review or possible change that does not indicate an improvement, in the
rating accorded any securities of or guaranteed by the Company by any
"nationally recognized statistical rating organization," as such term is
defined for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is given in the
Prospectus there shall not have been any material adverse change or any
development involving a prospective material adverse change, in or affecting
the general affairs, business, prospects, management, properties, financial
position, shareholders' equity or results of operations of the Company and its
Subsidiaries, taken as a whole, otherwise than as set forth or contemplated in
the Prospectus, the effect of which in the judgment of the Underwriter makes it
impracticable or inadvisable to proceed with the public offering or the
delivery of the Securities on the terms and in the manner contemplated in the
Prospectus;
(e) the Underwriter shall have received on and as of the Closing Date a
certificate of the Chairman or President of the Company and the Chief Financial
or Accounting Officer of the Company satisfactory to the Underwriter to the
effect set forth in subsections (a) through (c) of this Section and to the
further effect that there has not occurred any material adverse change, or any
development involving a prospective material adverse change, in or affecting
the general affairs, business, prospects, management, properties, financial
position, shareholders' equity or results of operations of the Company and its
Subsidiaries taken as a whole from that set forth or contemplated in the
Registration Statement.
(f) Alston & Bird, counsel for the Company, shall have furnished to the
Underwriter its written opinion, dated the Closing Date, in form and substance
satisfactory to the Underwriter, to the effect that:
(i) the Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Georgia, with
power and authority (corporate or other) to own its properties and
conduct its business as described in the Prospectus as then amended or
supplemented;
(ii) other than as set forth or contemplated in the Prospectus, to
the best of such counsel's knowledge, there are no legal or governmental
proceedings pending or threatened to which the Company or its
Subsidiaries is or may be a party or to which
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any property of the Company or its Subsidiaries is or may be the subject
which, if determined adversely to the Company or its Subsidiaries, could
individually or in the aggregate reasonably be expected to have a
Material Adverse Effect; to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others; and such counsel does not know of any contracts or
other documents of a character required to be filed as an exhibit to the
Registration Statement or required to be incorporated by reference into
the Prospectus or required to be described in the Registration Statement
or the Prospectus which are not filed or incorporated by reference or
described as required;
(iii) this Agreement has been duly authorized, executed and
delivered by the Company;
(iv) the Securities have been duly authorized and executed by the
Company and when authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Underwriter in accordance
with the terms of this Agreement, will constitute valid and binding
obligations of the Company entitled to the benefits provided by the
Indenture, enforceable against the Company in accordance with their
terms, except to the extent that enforcement thereof may be limited by
(i) bankruptcy, insolvency, reorganization, moratorium or similar laws
now or hereafter in effect relating to creditors' rights generally and
(ii) general principles of equity (regardless of whether enforceability
is considered in a proceeding at law or in equity);
(v) the Indenture has been duly authorized, executed and delivered
by the Company and constitutes a valid and binding instrument of the
Company enforceable against the Company in accordance with its terms,
except to the extent that enforcement thereof may be limited by (i)
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights generally and (ii)
general principles of equity (regardless of whether enforceability is
considered in a proceeding at law or in equity); and the Indenture has
been duly qualified under the Trust Indenture Act;
(vi) the Indenture and the Securities conform in all material
respects to the descriptions thereof in the Registration Statement and
the Prospectus;
(vii) the Company's authorized, issued and outstanding shares of
capital stock is as set forth under the caption "Capitalization" in the
Prospectus; and all of the issued shares of capital stock of the Company
have been duly and validly authorized and issued, are fully paid and non-
assessable;
(viii) the issue and sale of the Securities and the performance by
the Company of its obligations under the Securities, the Indenture and
this Agreement and the consummation of the transactions herein and
therein contemplated will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under,
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<PAGE> 14
any indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument known to such counsel to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound or to which any of the property or assets of
the Company or any of its Subsidiaries is subject, nor will any such
action result in any violation of the provisions of the Articles of
Incorporation or the By-Laws of the Company or any applicable law or
statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company, its Subsidiaries or
any of their respective properties;
(ix) no consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is
required for the issue and sale of the Securities or the consummation of
the other transactions contemplated by this Agreement or the Indenture,
except such consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act and the
Trust Indenture Act and as may be required under state securities or Blue
Sky laws in connection with the purchase and distribution of the
Securities by the Underwriter;
(x) the statements (A) contained in the Prospectus under the
captions "Description of Notes," "Description of Debt Securities," and
"Certain Federal Income Tax Considerations to the Company of its REIT
Election," (B) incorporated by reference in the Prospectus from Item 3 of
Part 1 of the Company's Annual Report on Form 10-K for the year ended
December 31, 1995, as amended, and contained in the Registration
Statement in item 15, insofar as such statements constitute a summary of
the legal matters, documents or proceedings referred to therein, fairly
present the information called for with respect to such legal matters,
documents or proceedings;
(xi) the Company has qualified to be taxed as a real estate
investment trust pursuant to Sections 856 through 860 of the Internal
Revenue Code, as amended, for the fiscal years ended December 31, 1990
through December 31, 1995, and the Company's present method of operation,
diversity of stock ownership and its assets and contemplated income are
such that the Company is in a position under present law to so qualify
for the fiscal year ending December 31, 1996 and in future years; and the
Company is not an open-end investment company, unit investment trust,
closed-end investment company or face-amount certificate company that is
or is required to be registered under the Investment Company Act;
(xii) the Registration Statement is effective under the Securities
Act and, to the best of such counsel's knowledge and information, no stop
order suspending the effectiveness of the Registration Statement has been
issued under the Securities Act or proceeding therefor initiated or
threatened by the Commission;
(xiii) such counsel (A) is of the opinion that each document
incorporated by reference in the Registration Statement and the
Prospectus (except for the historical and pro forma financial statements
included therein as to which such counsel need express
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<PAGE> 15
no opinion) complied as to form in all material respects with the
Exchange Act when filed with the Commission, (B) believes that (except
for the historical and pro forma financial statements included therein as
to which such counsel need express no belief) each part of the
Registration Statement (including the documents incorporated by reference
therein) filed with the Commission pursuant to the Securities Act
relating to the Securities, when such part became effective, did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, not misleading, (C) is of the opinion that the
Registration Statement and the Prospectus and any amendments and
supplements thereto (except for the historical and pro forma financial
statements included therein as to which such counsel need express no
opinion) comply as to form in all material respects with the requirements
of the Securities Act and the Trust Indenture Act and (D) believes that
(except for the historical and pro forma financial statements included
therein as to which such counsel need express no belief) the Registration
Statement and the Prospectus, as of the respective dates and on the date
of this Agreement, did not contain any untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in the case of the Prospectus,
in the light of the circumstances under which they were made, not
misleading, and that the Prospectus as amended or supplemented, if
applicable, on the Closing Date does not contain any untrue statement of
a material fact or omit to state a material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading; and
(xiv) the Company is not, and will not become as a result of the
consummation of the transactions contemplated by this Agreement, an
"investment company" within the meaning of the Investment Company Act of
1940, as amended, and has not been an "investment company" at any time
since 1990.
In rendering such opinions, Alston & Bird may rely (A) as to matters
involving the application of laws other than the laws of the United States and
the State of Georgia, to the extent such counsel deems proper and to the extent
specified in such opinion, if at all, upon an opinion or opinions (in form and
substance reasonably satisfactory to Underwriter's counsel) of other counsel
reasonably acceptable to the Underwriter's counsel, familiar with the
applicable laws; (B) as to matters of fact, to the extent such counsel deems
proper, on certificates of responsible officers of the Company and certificates
or other written statements of officials of jurisdictions having custody of
documents respecting the corporate existence or good standing of the Company.
The opinion of such counsel for the Company shall state that the opinion of any
such other counsel is in form satisfactory to such counsel and, in such
counsel's opinion, the Underwriter and they are justified in relying thereon.
With respect to the matters to be covered in subparagraph (xiii) above, counsel
may state its opinion and belief is based upon their participation in the
preparation of the Registration Statement and the Prospectus and any amendment
or supplement thereto and review and discussion of the contents but is without
independent check or verification except as specified.
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(g) Lee A. Harris, Senior Vice President and Secretary of the Company,
shall have furnished to the Underwriter his written opinion, dated the Closing
Date, in form and substance satisfactory to the Underwriter, to the effect
that:
(i) the Company has been duly organized and is validly existing as a
corporation in good standing under the laws of the State of Georgia, with
power and authority (corporate or other) to own its properties and
conduct its business as described in the Prospectus as then amended or
supplemented;
(ii) the Company has been duly qualified as a foreign corporation
for the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than
where the failure to be so qualified or in good standing would not have a
Material Adverse Effect;
(iii) each of the Company's Subsidiaries have been duly organized
and is validly existing as a corporation or limited partnership, as the
case may be, in good standing under the laws of their respective
jurisdictions of organization, with power and authority (corporate or
other) to own its properties and conduct its business as described in the
Prospectus as amended or supplemented;
(iv) each of the Company's Subsidiaries has been duly qualified as
foreign corporations or limited partnerships, as the case may be, for the
transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a Material
Adverse Effect; and all of the outstanding shares of capital stock or
partnership interests of each Subsidiary have been duly authorized and
validly issued, are fully paid and non-assessable, and are owned by the
Company, directly or indirectly through another Subsidiary, free and
clear of any liens, encumbrances, security interests and claims;
(v) other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending or, to the best of such
counsel's knowledge, threatened to which the Company or its Subsidiaries
is or may be a party or to which any property of the Company or its
Subsidiaries is or may be the subject which, if determined adversely to
the Company or its Subsidiaries, could individually or in the aggregate
reasonably be expected to have a Material Adverse Effect; to the best of
such counsel's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and
such counsel does not know of any contracts or other documents of a
character required to be filed as an exhibit to the Registration
Statement or required to be incorporated by reference into the Prospectus
or required to be described in the Registration Statement or the
Prospectus which are not filed or incorporated by reference or described
as required;
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<PAGE> 17
(vi) neither the Company nor any of its Subsidiaries is, nor with
the giving of notice or lapse of time or both would be, in violation of
or in default under, (i) their respective Articles of Incorporation or
By-Laws or (ii) any indenture, mortgage, deed of trust, loan agreement,
partnership agreement or other agreement or instrument known to such
counsel to which the Company or any of its Subsidiaries is a party or by
which it or any of them or any of their respective properties is bound,
except, with respect to this clause (ii), for violations and defaults
which individually or in the aggregate would not have a Material Adverse
Effect; the issue and sale of the Securities and the performance by the
Company of its obligations under the Securities, the Indenture and this
Agreement and the consummation of the transactions herein and therein
contemplated will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material agreement or
instrument known to such counsel to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its
Subsidiaries is bound or to which any of the property or assets of the
Company or any of its Subsidiaries is subject, nor will any such action
result in any violation of the provisions of the Articles of
Incorporation or the By-Laws of the Company or, to the best of such
counsel's knowledge, any applicable law or statute or any order, rule or
regulation of any court or governmental agency or body having
jurisdiction over the Company, its Subsidiaries or any of their
respective properties;
(vii) the investments of the Company described in the Prospectus are
permitted investments under the Articles of Incorporation and By-laws of
the Company; and
(viii) such counsel (A) believes that (except for the historical and
pro forma financial statements included therein as to which such counsel
need express no belief) each part of the Registration Statement
(including the documents incorporated by reference therein) filed with
the Commission pursuant to the Securities Act relating to the Securities,
when such part became effective, did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, not misleading, and
(B) believes that (except for the historical and pro forma financial
statements included therein as to which such counsel need express no
belief) the Registration Statement and the Prospectus, as of the
respective dates and on the date of this Agreement, did not contain any
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein, in the case of the Prospectus, in the light of the circumstances
under which they were made, not misleading, and that the Prospectus as
amended or supplemented, if applicable, on the Closing Date does not
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
In rendering his opinion, Lee A. Harris may rely (A) as to matters
involving the application of laws other than the laws of the United States and
the State of Georgia, to the
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<PAGE> 18
extent such counsel deems proper and to the extent specified in such opinion,
if at all, upon an opinion or opinions (in form and substance reasonably
satisfactory to Underwriter's counsel) of other counsel reasonably acceptable
to the Underwriter's counsel, familiar with the applicable laws; (B) as to
matters of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and certificates or other written
statements of officials of jurisdictions having custody of documents respecting
the corporate existence or good standing of the Company. The opinion of such
counsel for the Company shall state that the opinion of any such other counsel
is in form satisfactory to such counsel and, in such counsel's opinion, the
Underwriter and they are justified in relying thereon. With respect to the
matters to be covered in subparagraph (viii) above, counsel may state his
opinion and belief is based upon his participation in the preparation of the
Registration Statement and the Prospectus and any amendment or supplement
thereto and review and discussion of the contents but is without independent
check or verification except as specified.
(h) on the date of execution of this Agreement and on the Closing Date,
Arthur Andersen LLP shall have furnished to the Underwriter letters, dated such
respective dates of delivery, in form and substance satisfactory to the
Underwriter, containing statements and information of the type customarily
included in accountants "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in the
Registration Statement and the Prospectus;
(i) the Underwriter shall have received on and as of the Closing Date an
opinion of Skadden, Arps, Slate, Meagher & Flom, counsel to the Underwriter,
with respect to the validity of the Indenture and the Securities, the
Registration Statement, the Prospectus and other related matters as the
Underwriter may reasonably request, and such counsel shall have received such
papers and information as they may reasonably request to enable them to pass
upon such matters; and
(j) on or prior to the Closing Date, the Company shall have furnished to
the Underwriter such further certificates and documents confirming the
representations and warranties contained herein and related matters as the
Underwriter shall reasonably request.
The opinions and certificates mentioned in this Agreement shall be deemed
to be in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Underwriter and to Skadden, Arps, Slate, Meagher &
Flom, counsel for the Underwriter.
7. The Company agrees to indemnify and hold harmless the Underwriter and
each person, if any, who controls the Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages and liabilities (including without
limitation the legal fees and other expenses incurred in connection with any
suit, action or proceeding or any claim asserted) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission
17
<PAGE> 19
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein, not misleading, except
insofar as such losses, claims, damages or liabilities are caused by any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with information relating to the Underwriter furnished
to the Company in writing by the Underwriter expressly for use therein;
provided, that the foregoing indemnity with respect to any preliminary
prospectus shall not inure to the benefit of the Underwriter (or to the benefit
of any person controlling the Underwriter) from whom the person asserting any
such losses, claims, damages or liabilities purchased Securities if such untrue
statement or omission or alleged untrue statement or omission made in such
preliminary prospectus is eliminated or remedied in the Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) and, if required by law, a copy of the Prospectus (as so
amended or supplemented) shall not have been furnished to such person at or
prior to the written confirmation of the sale of such Securities to such
person.
The Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and each person who controls the Company within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act, to the
same extent as the foregoing indemnity from the Company to the Underwriter, but
only with reference to information relating to the Underwriter furnished to the
Company in writing by the Underwriter expressly for use in the Registration
Statement, the Prospectus, any amendment or supplement thereto, or any
preliminary prospectus. For purposes of this Section 7 and Sections 4(a) and
4(b), the only written information furnished by the Underwriter to the Company
expressly for use in the Registration Statement and the Prospectus is (a) the
information in the last paragraph on the cover page of the Prospectus
specifically relating to the Securities, (b) the information regarding
stabilization in the first paragraph on the inside front cover page of the
Prospectus specifically relating to the Securities and (c) the information
contained in the third and sixth paragraphs under the caption "Underwriting" in
the prospectus supplement specifically relating to the Securities.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "Indemnified Person") shall promptly
notify the person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, and the Indemnifying Person, upon request of the
Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the fees and
expenses of such counsel related to such proceeding. In any such proceeding,
any Indemnified Person shall have the right to retain its own counsel, but the
fees and expenses of such counsel retained by the Indemnified Person shall be
at the expense of such Indemnified Person unless (i) the Indemnifying Person
and the Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties in
any such proceeding (including any impleaded parties) include both
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<PAGE> 20
the Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. If, pursuant to the preceding sentence, the
Indemnifying Person is required to pay the fees and expenses of counsel
retained by the Indemnified Person, the Indemnifying Person will not be
required to retain counsel for the Indemnified Person pursuant to the first
sentence of this paragraph. It is understood that the Indemnifying Person shall
not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all Indemnified Persons, and that
all such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for the Underwriter and such control persons of Underwriter shall
be designated in writing by the Underwriter and any such separate firm for the
Company, its directors, its officers who sign the Registration Statement and
such control persons of the Company shall be designated in writing by the
Company. The Indemnifying Person shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. If at any time an
Indemnified Person shall have requested in writing an Indemnifying Person to
reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by the fourth sentence of this paragraph, the Indemnifying Person
agrees that if the Indemnified Person has not been reimbursed for such fees and
expenses within 30 days of such request (the "measurement date"), the
Indemnifying Person will pay interest on the amounts due from the measurement
date to the date of actual payment at a per annum rate equal to the sum of the
prime rate then in effect as announced by Morgan Guaranty Trust Company of New
York plus 2.0%. No Indemnifying Person shall, without the prior written consent
of the Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is or could have been a
party and indemnity could have been sought hereunder by such Indemnified
Person, unless such settlement includes an unconditional release of such
Indemnified Person from all liability on claims that are the subject matter of
such proceeding.
If the indemnification provided for in the first and second paragraphs of
this Section 7 is unavailable to an Indemnified Person in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable
by such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriter on the
other hand from the offering of the Securities or (ii) if the allocation
provided by clause (i) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the Company on the one
hand and the Underwriter on the other in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative benefits received
by the Company on the one hand and the Underwriter on the other shall be deemed
to be in the same respective proportions as the net proceeds from the offering
of such Securities (before deduct-
19
<PAGE> 21
ing expenses) received by the Company and the total underwriting discounts and
the commissions received by the Underwriter bear to the aggregate public
offering price of the Securities. The relative fault of the Company on the one
hand and the Underwriter on the other shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriter and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company and the Underwriter agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriter was treated as one entity for such
purpose) or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses incurred by such Indemnified Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall the
Underwriter be required to contribute any amount in excess of the amount by
which the total price at which the Securities underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages that the Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Underwriter's
obligations to contribute pursuant to this Section 7 are several in proportion
to the respective principal amounts of Securities set forth opposite their
names in Schedule II hereto, and not joint.
The indemnity and contribution agreements contained in this Section 7 are
in addition to any liability which the Indemnifying Persons may otherwise have
to the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section 7 and
the representations, warranties and covenants of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of the Underwriter or any person controlling the Underwriter or by or on behalf
of the Company, its officers or directors or any other person controlling the
Company and (iii) acceptance of and payment for any of the Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Underwriter, by notice given to
the Company, if after the execution and delivery of this Agreement and prior to
the Closing Date (i) there shall have occurred, since the respective dates as
of which information is given in the Registration Statement and the Prospectus,
any material adverse change or any development involving a prospective material
adverse change in or affecting the condition, financial or otherwise, of the
Company
20
<PAGE> 22
or the earnings, business affairs, properties, management or business prospects
of the Company, whether or not arising in the ordinary course of business, (ii)
trading generally shall have been suspended or materially limited on or by, as
the case may be, any of the New York Stock Exchange, the American Stock
Exchange, the National Association of Securities Dealers, Inc., the Chicago
Board Options Exchange, the Chicago Mercantile Exchange or the Chicago Board of
Trade, (iii) trading of any securities of or guaranteed by the Company shall
have been suspended on any exchange or in any over-the-counter market, (iv) a
general moratorium on commercial banking activities in New York shall have been
declared by either Federal or New York State authorities; (v) there has
occurred any downgrading in the rating of the Company's debt securities by any
"nationally recognized statistical rating organization" (as defined for
purposes of Rule 436(g) under the Exchange Act); or (vi) there shall have
occurred any outbreak or escalation of hostilities or any change in financial
markets or any calamity or crisis that, in the judgment of the Underwriter, is
material and adverse and which, in the judgment of the Underwriter, makes it
impracticable to market the Securities on the terms and in the manner
contemplated in the Prospectus.
9. If this Agreement shall be terminated by the Underwriter because of any
failure or refusal on the part of the Company to comply with the terms or to
fulfill any of the conditions of this Agreement, or if for any reason the
Company shall be unable to perform its obligations under this Agreement or any
condition of the Underwriter's obligations cannot be fulfilled, the Company
agrees to reimburse the Underwriter for all out-of-pocket expenses (including
the fees and expenses of their counsel) reasonably incurred by the Underwriter
in connection with this Agreement or the offering of Securities.
10. This Agreement shall inure to the benefit of and be legally binding
upon the Company, the Underwriter, any controlling persons referred to herein
and their respective successors and assigns. Nothing expressed or mentioned in
this Agreement is intended or shall be construed to give any other person, firm
or corporation any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. No purchaser of
Securities from the Underwriter shall be deemed to be a successor by reason
merely of such purchase.
11. All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Underwriter shall be given
to the Underwriter, Alex. Brown & Sons Incorporated, at 135 East Baltimore
Street, Baltimore, Maryland 21202, facsimile number: (410) 783-3033, Attention:
Syndicate Department. Notices to the Company shall be given to it at 200
Galleria Parkway, Suite 1400, Atlanta, Georgia 30339, facsimile number
770-988-8773, Attention: Lee A. Harris, Senior Vice President and Secretary.
21
<PAGE> 23
12. Miscellaneous. This Agreement may be signed in counterparts, each of
which shall be an original and all of which together shall constitute one and
the same instrument. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
conflicts of laws provisions thereof.
Very truly yours,
IRT PROPERTY COMPANY
By: /s/ Donald W. MacLeod
-----------------------
Name: Donald W. MacLeod
Title: Chairman and Chief Executive Officer
Accepted: March 21, 1996
ALEX. BROWN & SONS INCORPORATED
By: /s/ David G. Bannister
----------------------
Name: David G. Bannister
Title: Managing Director
<PAGE> 24
SCHEDULE I
Underwriter: Alex. Brown & Sons Incorporated
Underwriting Agreement dated: March 21, 1996
Registration Statement No.: 33-63523
Title of Securities: 7.45% Notes due 2001
Aggregate principal amount: $50,000,000
Price to Public: 99.833 % of the principal amount of the
Securities, plus accrued interest, if
any, from the Closing Date
Underwriting Discount: 0.600%
Purchase Price to Underwriter: 99.233% of the principal amount of the
Securities
Indenture: Indenture dated as of November 9, 1995,
as amended by the Supplemental
Indenture No. 1 dated as of
March 26, 1996, between IRT Property
Company and SunTrust Bank, Atlanta
Maturity: April 1, 2001
Interest Rate: 7.45%
Interest Payment Dates: April 1 and October 1, commencing
October 1, 1996
Optional Redemption Provisions: None
Sinking Fund Provisions: None
Closing Date and Time of Delivery: March 26, 1996, 10:00 a.m.
Closing Location: Skadden, Arps, Slate, Meagher &
Flom 919 Third Avenue New York, NY
10022
<PAGE> 25
SCHEDULE II
Percentage
Subsidiary Name Owned
--------------- ----------
IRT Management Company 100%
(a Georgia corporation)
VW Mall, Inc. 100%
(a Georgia corporation)
<PAGE> 1
EXHIBIT 4
FIRST SUPPLEMENTAL INDENTURE
DATED AS OF MARCH 26, 1996 BETWEEN
IRT PROPERTY COMPANY AND SUNTRUST BANK, ATLANTA
<PAGE> 2
- --------------------------------------------------------------------------------
IRT PROPERTY COMPANY
Issuer
to
SUNTRUST BANK, ATLANTA
Trustee
-------------------------
Supplemental Indenture No. 1
Dated as of March 26, 1996
-------------------------
$50,000,000
7.45% Notes due 2001
- --------------------------------------------------------------------------------
<PAGE> 3
SUPPLEMENTAL INDENTURE NO. 1, dated as of March 26, 1996 (the
"Supplemental Indenture"), between IRT PROPERTY COMPANY, a corporation duly
organized and existing under the laws of the State of Georgia (herein called
the "Company"), and SUNTRUST BANK, ATLANTA, a Georgia banking corporation duly
organized and existing under the laws of the State of Georgia, as Trustee
(herein called the "Trustee").
RECITALS OF THE COMPANY
The Company has heretofore delivered to the Trustee an Indenture dated as
of November 9, 1995 (the "Senior Indenture"), a form of which has been filed
with the Securities and Exchange Commission under the Securities Act of 1933,
as amended, as an exhibit to the Company's Registration Statement on Form S-3
(Registration No. 33-63523), providing for the issuance from time to time of
Senior Debt Securities of the Company (the "Securities").
Section 301 of the Senior Indenture provides for various matters with
respect to any series of Securities issued under the Senior Indenture to be
established in an indenture supplemental to the Senior Indenture.
Section 901(7) of the Senior Indenture provides for the Company and the
Trustee to enter into an indenture supplemental to the Senior Indenture to
establish the form or terms of Securities of any series as provided by
Sections 201 and 301 of the Senior Indenture.
The Board of Directors of the Company has duly adopted resolutions
authorizing the Company to execute and deliver this Supplemental Indenture.
All the conditions and requirements necessary to make this Supplemental
Indenture, when duly executed and delivered, a valid and binding agreement in
accordance with its terms and for the purposes herein expressed, have been
performed and fulfilled.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the series
of Securities provided for herein by the Holders thereof, it is mutually
covenanted and agreed, for the equal and proportionate benefit of all Holders
of the Securities or of any series thereof, as follows:
ARTICLE ONE
RELATION TO SENIOR INDENTURE; DEFINITIONS
SECTION 1.1. Relation to Senior Indenture.
This Supplemental Indenture constitutes an integral part of the Senior
Indenture.
<PAGE> 4
SECTION 1.2. Definitions.
For all purposes of this Supplemental Indenture, except as otherwise
expressly provided for or unless the context otherwise requires:
(1) Capitalized terms used but not defined herein shall have the
respective meanings assigned to them in the Senior Indenture; and
(2) All references herein to Articles and Sections, unless otherwise
specified, refer to the corresponding Articles and Sections of this
Supplemental Indenture.
"Annual Service Charge" for any period means the maximum amount which is
payable during such period for interest on, and the amortization during such
period of any original issue discount of, Debt of the Company and its
Subsidiaries and the amount of dividends which are payable during such period
in respect of any Disqualified Stock.
"Business Day" means any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions in the City of
New York or in the City of Atlanta are authorized or required by law,
regulation or executive order to close.
"Consolidated Income Available for Debt Service" for any period means
Earnings from Operations of the Company and its Subsidiaries plus amounts
which have been deducted, and minus amounts which have been added, for the
following (without duplication): (a) interest on Debt of the Company and its
Subsidiaries, (b) provision for taxes of the Company and its Subsidiaries
based on income, (c) amortization of debt discount, (d) provisions for gains
and losses on properties and property depreciation and amortization, (e) the
effect of any noncash charge resulting from a change in accounting principles
in determining Earnings from Operations for such period and (f) amortization
of deferred charges.
"Corporate Trust Office" means the office of the Trustee at which, at any
particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at 58 Edgewood
Avenue, Room 400, Atlanta, Georgia 30303 and, for purposes of the Place of
Payment provisions of Sections 305 and 1002 of the Senior Indenture, is
located at c/o Chemical-Mellon Shareholder Services, Inc., 120 Broadway, 33rd
Floor, New York, New York 10271.
"Debt" of the Company or any Subsidiary means any indebtedness of the
Company or any Subsidiary, whether or not contingent, in respect of (i)
borrowed money or evidenced by bonds, notes, debentures or similar
instruments, (ii) indebtedness for borrowed money secured by any mortgage,
lien, charge, pledge, or security interest of any kind existing on property
owned by the Company or any Subsidiary (each securing such debt, an
"Encumbrance"), (iii) the reimbursement obligations, contingent or otherwise,
in connection with any letters of credit actually issued or amounts
representing the balance deferred and unpaid of the purchase price of any
property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional
2
<PAGE> 5
sale obligations or obligations under any title retention agreement, (iv) the
principal amount of all obligations of the Company or any Subsidiary with
respect to redemption, repayment or other repurchase of any Disqualified Stock
or (v) any lease of property by the Company or any Subsidiary as lessee which
is reflected on the Company's Consolidated Balance Sheet as a capitalized
lease in accordance with GAAP to the extent, in the case of items of
indebtedness under (i) through (iii) above, that any such items (other than
letters of credit) would appear as a liability on the Company's Consolidated
Balance Sheet in accordance with GAAP, and also includes, to the extent not
otherwise included, any obligations by the Company or any Subsidiary to be
liable for, or to pay, as obligor, guarantor or otherwise (other than for
purposes of collection in the ordinary course of business), Debt of another
Person (other than the Company or any Subsidiary) (it being understood that
Debt shall be deemed to be incurred by the Company or any Subsidiary whenever
the Company or such Subsidiary shall create, assume, guarantee or otherwise
become liable in respect thereof).
"Disqualified Stock" means, with respect to any Person, any Capital Stock
of such Person which by the terms of such Capital Stock (or by the terms of
any security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than Capital Stock which is redeemable solely in exchange for common
stock), (ii) is convertible into or exchangeable or exercisable for Debt or
Disqualified Stock or (iii) is redeemable at the option of the holder thereof,
in whole or in part (other than Capital Stock which is redeemable solely in
exchange for common stock), in each case on or prior to the Stated Maturity
of the Notes.
"Earnings from Operations" for any period means net earnings excluding
gains and losses on sales of investments, extraordinary items, and property
valuation losses, net as reflected in the financial statements of the Company
and its Subsidiaries for such period determined on a consolidated basis in
accordance with GAAP.
"Encumbrance" has the meaning specified in the definition of "Debt" set
forth in this Section 1.2.
"Financial Statements" has the meaning specified in Section 1009 of the
Senior Indenture.
"Notes" has the meaning specified in Section 2.1 hereof.
"Total Assets" as of any date means the sum of (i) the Undepreciated Real
Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined in accordance with GAAP (but excluding accounts receivable and
intangibles).
"Total Unencumbered Assets" means the sum of (i) those Undepreciated Real
Estate Assets not subject to an Encumbrance for borrowed money and (ii) all
other assets of the Company and its Subsidiaries not subject to an
Encumbrance for borrowed money determined in accordance with GAAP (but
excluding accounts receivable and intangibles).
3
<PAGE> 6
"Undepreciated Real Estate Assets" as of any date means the cost
(original cost plus capital improvements) of real estate assets of the Company
and its Subsidiaries on such date, before depreciation and amortization
determined on a consolidated basis in accordance with GAAP.
"Unsecured Debt" means Debt which is not secured by any Encumbrance upon
any of the properties of the Company or any Subsidiary.
ARTICLE TWO
THE SERIES OF NOTES
SECTION 2.1. Title of the Securities.
There shall be a series of Securities designated the "7.45% Notes due
2001" (the "Notes").
SECTION 2.2. Limitation on Aggregate Principal Amount.
The aggregate principal amount of the Notes shall be limited to
$50,000,000, and, except as provided in this Section and in Section 306 of the
Senior Indenture, the Company shall not execute and the Trustee shall not
authenticate or deliver Notes in excess of such aggregate principal amount.
Nothing contained in this Section 2.2 or elsewhere in this Supplemental
Indenture, or in the Notes, is intended to or shall limit execution by the
Company or authentication or delivery by the Trustee of Notes under the
circumstances contemplated by Sections 303, 304, 306, 906 and 1304 of the
Senior Indenture.
SECTION 2.3. Interest and Interest Rates; Maturity Date of Notes.
The Notes will bear interest at a rate of 7.45% per annum from March 26,
1996 or from the immediately preceding Interest Payment Date to which interest
has been paid or duly provided for, payable semi-annually in arrears on April
1 and October 1 of each year, commencing October 1, 1996 (each, an "Interest
Payment Date"), to the Person in whose name such Note is registered at the
close of business on March 15 or September 15 (whether or not a Business Day),
as the case may be, next preceding such Interest Payment Date (each, a "Regular
Record Date"). Interest will be computed on the basis of a 360-day year
comprised of twelve 30-day months. The interest so payable on any Note which
is not punctually paid or duly provided for on any Interest Payment Date shall
forthwith cease to be payable to the Person in whose name such Note is
registered on the relevant Regular Record Date, and such defaulted interest
shall instead be payable to the Person in whose name such Note is registered
on the Special Record Date or other specified date determined in accordance
with the Senior Indenture.
If any Interest Payment Date or Maturity falls on a day that is not a
Business Day, the required payment shall be made on the next Business Day as
if it were made on the date such payment was due and no interest shall accrue
on the amount so
4
<PAGE> 7
payable for the period from and after such Interest Payment Date or the
Maturity Date, as the case may be.
The Notes will mature on April 1, 2001.
SECTION 2.4. Limitations on Incurrence of Debt.
(a) The Company will not, and will not permit any Subsidiary to, incur
any Debt if, immediately after giving effect to the incurrence of such
additional Debt and the application of the proceeds thereof, the aggregate
principal amount of all outstanding Debt of the Company and its Subsidiaries
on a consolidated basis determined in accordance with GAAP is greater than 60%
of the sum of (without duplication) (i) the Total Assets of the Company and
its Subsidiaries as of the end of the calendar quarter covered in the
Company's Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the
case may be, most recently filed with the Commission (or, if such filing is
not permitted under the Exchange Act, with the Trustee) prior to the
incurrence of such additional Debt and (ii) the purchase price of any real
estate assets or mortgages receivable acquired, and the amount of any
securities offering proceeds received (to the extent such proceeds were not
used to acquire real estate assets or mortgages receivable or used to reduce
Debt), by the Company or any Subsidiary since the end of such calendar
quarter, including those proceeds obtained in connection with the incurrence
of such additional Debt.
(b) In addition to the limitation set forth in subsection (a) of this
Section 2.4, the Company will not, and will not permit any Subsidiary to,
incur any Debt if the ratio of Consolidated Income Available for Debt Service
to the Annual Service Charge for the four consecutive fiscal quarters most
recently ended prior to the date on which such additional Debt is to be
incurred shall have been less than 1.5:1, on a pro forma basis after giving
effect thereto and to the application of the proceeds therefrom, and
calculated on the assumption that (i) such Debt and any other Debt incurred by
the Company and its Subsidiaries since the first day of such four-quarter
period and the application of the proceeds therefrom, including to refinance
other Debt, had occurred at the beginning of such period; (ii) the repayment
or retirement of any other Debt by the Company and its Subsidiaries since the
first day of such four-quarter period had been repaid or retired at the
beginning of such period (except that, in making such computation, the amount
of Debt under any revolving credit facility shall be computed based upon the
average daily balance of such Debt during such period); (iii) in the case of
Acquired Debt or Debt incurred in connection with any acquisition since the
first day of such four-quarter period, the related acquisition had occurred as
of the first day of such period with the appropriate adjustments with respect
to such acquisition being included in such pro forma calculation; and (iv) in
the case of any acquisition or disposition by the Company or its Subsidiaries
of any asset or group of assets since the first day of such four-quarter
period, whether by merger, stock purchase or sale, or asset purchase or sale,
such acquisition or disposition or any related repayment of Debt had occurred
as of the first day of such period with the appropriate adjustments with
respect to such acquisition or disposition being included in such pro forma
calculation.
(c) In addition to the limitation set forth in subsections (a) and (b) of
this Section 2.4, the Company will not, and will not permit any Subsidiary to,
incur any
5
<PAGE> 8
Debt secured by any Encumbrance upon any of the property of the Company or any
Subsidiary, if, immediately after giving effect to the incurrence of such
additional Debt and the application of the proceeds thereof, the aggregate
principal amount of all outstanding Debt of the Company and its Subsidiaries on
a consolidated basis which is secured by any Encumbrance on property of the
Company or any Subsidiary is greater than 40% of the sum of (without
duplication) (i) the Total Assets of the Company and its Subsidiaries as of
the end of the calendar quarter covered in the Company's Annual Report on
Form 10-K or Quarterly Report on Form 10-Q, as the case may be, most recently
filed with the Commission (or, if such filing is not permitted under the
Exchange Act, with the Trustee) prior to the incurrence of such additional
Debt and (ii) the purchase price of any real estate assets or mortgages
receivable acquired, and the amount of any securities offering proceeds
received (to the extent that such proceeds were not used to acquire real
estate assets or mortgages receivable or used to reduce Debt), by the Company
or any Subsidiary since the end of such calendar quarter, including those
proceeds obtained in connection with the incurrence of such additional Debt.
(d) The Company and its Subsidiaries may not at any time own Total
Unencumbered Assets equal to less than 150% of the aggregate outstanding
principal amount of the Unsecured Debt of the Company and its Subsidiaries on
a consolidated basis.
(e) For purposes of this Section 2.4, Debt shall be deemed to be
"incurred" by the Company or a Subsidiary whenever the Company or such
Subsidiary shall create, assume, guarantee or otherwise become liable in
respect thereof.
SECTION 2.5. Redemption.
The Notes shall not be redeemable prior to maturity.
SECTION 2.6. Places of Payment.
The Places of Payment where the Notes may be presented or surrendered for
payment, where the Notes may be surrendered for registration of transfer or
exchange and where notices and demands to and upon the Company in respect of
the Notes and the Senior Indenture may be served shall be in (i) the Borough
of Manhattan, The City of New York, New York, and the office or agency for
such purpose shall initially be Chemical-Mellon Shareholder Services, Inc.,
120 Broadway, 33rd Floor, New York, New York 10271 and (ii) the City of
Atlanta, Georgia, and the office or agency for such purpose shall initially be
located at c/o SunTrust Bank, Atlanta, 58 Edgewood Avenue, Room 400, Atlanta,
Georgia 30303.
SECTION 2.7. Method of Payment.
Payment of the principal of and interest on the Notes will be made at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City of New York (which shall initially be an office or agency
of the Trustee), in such coin or currency of the United States of America as
at the time of payment is legal tender for payment of public and private
debts; provided, however, that at the option of the Company, payments of
principal and interest on the Notes (other than
6
<PAGE> 9
payments of principal and interest due at Maturity) may be made (i) by check
mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or (ii) by wire transfer to an account
maintained by the Person entitled thereto located inside the United States.
SECTION 2.8. Currency.
Principal and interest on the Notes shall be payable in Dollars.
SECTION 2.9. Registered Securities; Global Form.
The Notes shall be issuable and transferable in fully registered form as
Registered Securities, without coupons. The Notes shall be issued in the form
of one or more permanent global Securities. The depositary for the Notes
shall be DTC. The Notes shall not be issuable in definitive form except as
provided in Section 305 of the Senior Indenture.
SECTION 2.10. Form of Notes.
The Notes shall be substantially in the form attached as Exhibit A
hereto.
SECTION 2.11. Registrar and Paying Agent.
The Trustee shall initially serve as Registrar and Paying Agent for the
Notes.
SECTION 2.12. Defeasance.
The provisions of Sections 1402 and 1403 of the Senior Indenture,
together with the other provisions of Article XIV of the Senior Indenture,
shall be applicable to the Notes. The provisions of Section 1403 of the Senior
Indenture shall apply to the covenants set forth in Section 2.4 of this
Supplemental Indenture and to those covenants specified in Section 1403 of the
Senior Indenture.
SECTION 2.13. Acceleration of Maturity; Rescission and Annulment.
The first paragraph of Section 502 of the Senior Indenture shall be
amended and restated in its entirety to read as follows:
If an Event of Default with respect to Securities of any series at the
time Outstanding occurs and is continuing, then in every such case the Trustee
or the Holders of not less than 25% in principal amount of the Outstanding
Securities of that series may declare the principal (or, if any Securities are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal as may be specified in the terms thereof) of, and the Make-Whole
Amount, if any, on, all the Securities of that series to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if
given by the Holders), and upon any such declaration such principal or
specified portion thereof shall become immediately due and payable. If an
Event of Default with respect to the Securities of any series set forth in
Section 501(7) of the Senior Indenture occurs
7
<PAGE> 10
and is continuing, then in every such case all the Securities of that series
shall become immediately due and payable, without notice to the Company, at
the principal amount thereof (or, if any Securities are Original Issue
Discount Securities or Indexed Securities, such portion of the principal as
may be specified in the terms thereof) plus accrued interest to the date the
Securities of that series are paid plus the Make-Whole Amount, if any, on the
Securities of that series.
ARTICLE THREE
MISCELLANEOUS PROVISIONS
SECTION 3.1. Ratification of Senior Indenture.
Except as expressly modified or amended hereby, the Senior Indenture
continues in full force and effect and is in all respects confirmed and
preserved.
SECTION 3.2. Governing Law.
This Supplemental Indenture and each Note shall be governed by and
construed in accordance with the laws of the State of Georgia. This
Supplemental Indenture is subject to the provisions of the Trust Indenture Act
of 1939, as amended and shall, to the extent applicable, be governed by such
provisions.
SECTION 3.3. Counterparts.
This Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same
instrument.
8
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed by their respective officers hereunto duly
authorized, all as of the day and year first written above.
IRT PROPERTY COMPANY
By: /s/ Mary M. Thomas
---------------------------
Name: Mary M. Thomas
Title: Executive Vice President
SUNTRUST BANK, ATLANTA,
as Trustee
By: /s/ M.R. Smith, Jr.
---------------------------
Name: M.R. Smith, Jr.
Title: Vice President
9
<PAGE> 12
EXHIBIT A TO
SUPPLEMENTAL INDENTURE
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY (AS
DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR
IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
Registered No. PRINCIPAL AMOUNT
CUSIP No.: 450058AB8 $
IRT PROPERTY COMPANY
7.45% NOTE DUE 2001
IRT PROPERTY COMPANY, a corporation duly organized and existing under the
laws of the State of Georgia (herein referred to as the "Company" which term
shall include any successor corporation under the Indenture hereinafter
referred to), for value received, hereby promises to pay to CEDE & CO., or
registered assigns, upon presentation, the principal sum of___________ DOLLARS
on April 1, 2001 and to pay interest on the outstanding principal amount
thereon from March 26, 1996, or from the immediately preceding Interest Payment
Date to which interest has been paid or duly provided for, semi-annually in
arrears on April 1 and October 1 in each year, commencing October 1, 1996, at
the rate of 7.45% per annum, until the entire principal hereof is paid or made
available for payment. The interest so payable and punctually paid or duly
provided for on any Interest Payment Date will, as provided in the Indenture,
be paid to the Person in whose name this Security is registered at the close of
business on the Regular Record Date for such interest which shall be the March
15 or September 15 (whether or not a Business Day), as the case may be, next
preceding such Interest Payment Date. Any such interest not so punctually paid
or duly provided for shall forthwith cease to be payable to the Holder on such
Regular Record Date, and may either be paid to the Person in whose name this
Security is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of the Securities not more than 15 days and
not less than 10 days prior to such Special Record Date, or may be paid at any
time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities may be listed, and upon such notice
as may be required by such exchange, all as more fully provided in the
Indenture. Payment of the principal of and interest on this Security will be
made at the office or agency maintained for that purpose in the City of New
York, New York, or elsewhere as provided in the Indenture, in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts; provided, however, that at the
option of the Company payments of principal and interest on the Notes (other
than payments of principal and interest due at Maturity) may be made (i) by
check mailed to the address of the Person entitled thereto as such address shall
appear in the Security
A-1
<PAGE> 13
Register or (ii) by wire transfer to an account of the Person entitled thereto
located inside the United States.
Securities of this series are one of a duly authorized issue of
securities of the Company (herein called the "Securities"), issued and to be
issued in one or more series under an Indenture, dated as of November 9,
1995, as supplemented by Supplemental Indenture No. 1, dated as of March 26,
1996 (as so supplemented, herein called the "Indenture"), between the Company
and SunTrust Bank, Atlanta (herein called the "Trustee," which term includes
any successor trustee under the Indenture), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities thereunder
of the Company, the Trustee and the Holders of the Securities and of the terms
upon which the Securities are authenticated and delivered. This Security is
one of the series designated in the first page thereof, limited in aggregate
principal amount to $50,000,000.
Securities of this series shall not be redeemable prior to maturity.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security and (b) certain
restrictive covenants and the related defaults and Events of Default
applicable to the Company, in each case, upon compliance by the Company with
certain conditions set forth in the Indenture, which provisions apply to this
Security.
If an Event of Default with respect to the Securities shall occur and be
continuing, the principal of the Securities may be declared due and payable in
the manner and with the effect provided in the Indenture.
As provided in and subject to the provisions of the Indenture, the Holder
of this Security shall not have the right to institute any proceeding with
respect to the Indenture or for the appointment of a receiver or trustee or
for any other remedy thereunder, unless such Holder shall have previously
given written notice to the Trustee of a continuing Event of Default with
respect to the Securities, the Holders of not less than 25% in principal
amount of the Securities of this series at the time Outstanding shall have
made written request to the Trustee to institute proceedings in respect of
such Event of Default as Trustee and offered the Trustee reasonable indemnity
and the Trustee shall not have received from the Holders of a majority in
principal amount of Securities of this series at the time Outstanding a
direction inconsistent with such request, and shall have failed to institute
any such proceeding, for 60 days after receipt of such notice, request and
offer of indemnity. The foregoing shall not apply to any suit instituted by
the Holder of this Security for the enforcement of any payment of principal
hereof or any interest on or after the respective due dates expressed herein.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Outstanding Securities of each series of Securities then Outstanding
affected thereby. The Indenture also contains provisions
A-2
<PAGE> 14
permitting the Holders of specified percentages in principal amount of the
Securities of each series at the time Outstanding, on behalf of the Holders of
all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders
of this Security and of any Security issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of
such consent or waiver is made upon this Security.
No reference herein to the Indenture and no provision of this Security or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute and unconditional, to pay the principal of and interest on this
Security at the times, place and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any Place of Payment where the principal of
and interest on this Security are payable duly endorsed by, or accompanied by
a written instrument of transfer in form satisfactory to the Company and the
Security Registrar duly executed by the Holder hereof or his attorney duly
authorized in writing, and thereupon one or more new Securities of this
series, of authorized denominations and for the same aggregate principal
amount, will be issued to the designated transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may treat
the Person in whose name this Security is registered as the owner hereof for
all purposes, whether or not this Security be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
No recourse under or upon any obligation, covenant or agreement contained
in the Indenture or in this Security, or because of any indebtedness evidenced
hereby or thereby, shall be had against any promoter, as such, or against any
past, present or future shareholder, officer or director, as such, of the
Company or of any successor, either directly or through the Company or any
successor, under any rule of law, statute or constitutional provision or by the
enforcement of any assessment or by any legal or equitable proceeding or
otherwise, all such liability being expressly waived and released by the
acceptance of this Security by the Holder thereof and as part of the
consideration for the issue of the Securities of this series.
A-3
<PAGE> 15
All capitalized terms used in this Security which are defined in the
Indenture shall have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF GEORGIA.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused "CUSIP" numbers to
be printed on the Securities of this series as a convenience to the Holders
of such Securities. No representation is made as to the correctness or
accuracy of such CUSIP numbers as printed on the Securities, and reliance may
be placed only on the other identification numbers printed hereon.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee by manual signature, this Security shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, IRT PROPERTY COMPANY has caused this instrument to be
duly executed under its corporate seal.
Dated:
IRT PROPERTY COMPANY
By:
---------------------
Name:
Title:
[Corporate Seal]
Attest:
- --------------------------
Secretary
TRUSTEE'S CERTIFICATE OF AUTHENTICATION:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
SUNTRUST BANK, ATLANTA
as Trustee
By:
---------------------
Authorized Signatory
A-4
<PAGE> 16
================================================================================
ASSIGNMENT FORM
FOR VALUE RECEIVED, the undersigned hereby
sells, assigns and transfers unto
PLEASE INSERT SOCIAL
SECURITY OR OTHER IDENTIFYING
NUMBER OF ASSIGNEE
. . . . . . . . . . . . . . . . . . . . .
- --------------------------------------
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(Please Print or Typewrite Name and Address including
Zip Code of Assignee)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
the within Security of IRT Property Company and hereby does irrevocably
constitute and appoint
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Attorney
to transfer said Security on the books of the within-named Company with full
power of substitution in the premises.
Dated: . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . .
NOTICE: The signature to this assignment must correspond with the name as it
appears on the first page of the within Security in every particular, without
alteration or enlargement or any change whatever.
================================================================================
<PAGE> 1
EXHIBIT 5
OPINION AS TO LEGALITY OF NOTES
<PAGE> 2
[ALSTON&BIRD LETTERHEAD]
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
404-881-7000
Fax: 404-881-7777
March 26, 1996
IRT Property Company
200 Galleria Parkway
Suite 1400
Atlanta, Georgia 30339
Gentlemen:
This opinion is given in connection with the filing by IRT Property
Company (the "Company") with the Securities and Exchange Commission under the
Securities Act of 1933, as amended, of a Registration Statement on Form S-3
(the "Registration Statement") with respect to $50.0 million principal amount
of 7.45% Notes due April 1, 2001 of the Company (the "Notes"). The Notes are
proposed to be issued by the Company pursuant to an indenture dated November 9,
1995 between the Company and SunTrust Bank, Atlanta, Georgia, as Trustee, as
supplemented on March 26, 1996 (the "Indenture").
As counsel to the Company, we have examined the relevant corporate and
other documents incident to the giving of this opinion. In our examination, we
have assumed the genuineness of all signatures and the authenticity of all
documents submitted to us as original documents, and conformity to original
documents of all documents submitted to us as certified, conformed or
photostatic copies. Based upon the foregoing, we are of the following opinion:
The Notes covered by the Registration Statement, when issued, sold and
authenticated in accordance with the terms of the Indenture pursuant to the
Underwriting Agreement between the Company and Alex. Brown & Sons Incorporated,
will be duly authorized, legally issued, valid and binding obligations of the
Company.
<PAGE> 3
March 26, 1996
Page 2
We hereby consent to the incorporation by reference of this opinion into
the Registration Statement. We further consent to the reference to our firm
under the heading "Legal Opinions" in the Prospectus Supplement dated March 21,
1996.
Very truly yours,
ALSTON & BIRD
By: /s/ F. Dean Copeland
------------------------
F. Dean Copeland
<PAGE> 1
EXHIBIT 8
TAX OPINION
<PAGE> 2
[ALSTON&BIRD LETTERHEAD]
One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30309-3424
404-881-7000
Fax: 404-881-7777
Pinney L. Allen Direct Dial: 404-881-7485
March 26, 1996
Alex. Brown & Sons Incorporated
135 East Baltimore Street
Baltimore, Maryland 21202
Re: IRT Property Company - Public Offering of Senior Unsecured
Notes
Ladies and Gentlemen:
In connection with the issuance of $50,000,000 of senior unsecured notes
by IRT Property Company ("IRT") (the "Note Offering"), you have asked us to
render an opinion with respect to the qualification of IRT as a real estate
investment trust ("REIT") under Sections 856 - 860 of the Internal Revenue Code
and with respect to the matters discussed under the heading "Taxation" of the
prospectus supplement dated March 21, 1996, with respect to the Note Offering
(the "Prospectus"). (Our references herein to "the Code" are to the Internal
Revenue Code of 1954 as amended prior to the Tax Reform Act of 1986 with
respect to provisions applicable to REITs through December 31, 1986, and to the
Internal Revenue Code of 1986, as amended, with respect to provisions
applicable to REITs for taxable years commencing after December 31, 1986.)
We have served as special counsel for IRT in connection with the Note
Offering and from time to time in the past have represented IRT on specific
matters as requested by IRT. Specifically for the purpose of this opinion, we
have examined: copies of IRT's Articles of Incorporation and amendments
thereto; its Federal income tax returns on Form 1120 as filed for its taxable
years ended December of 1987 through 1994 (in which returns we observe that IRT
has properly elected to be treated as a real estate investment trust); the
Prospectus; IRT's Annual Reports to Stockholders for the years 1987 through
1994; IRT's Form 10-K reports for the years 1987 through 1995; IRT's Form 1O-Q
reports for each of the quarters ended March 31, 1987 through September 30,
1995; its Form 8-K reports dated July 31, 1992 (as amended by Form 8-K/A report
dated August 18, 1992), October 1, 1992, January 6, 1993 (as amended by Form
8-K/A report dated March 1, 1993), July 14, 1994 (as amended by Form 8-K/A
dated August 1, 1994), January 5, 1995 (as amended by Forms 8-K/A dated January
20, 1995 and March 1, 1995), and January 2, 1996; the proxy statements for its
1987 through 1995 Annual Meetings of Shareholders; and its Form S-3
Registration Statements as filed with the Securities and Exchange Commission on
May 9, 1989,
<PAGE> 3
September 14, 1992, April 5, 1993, June 18, 1993, July 6, 1993, July 30, 1993,
and October 19, 1995, and amendments thereto. We have not served as general
counsel to IRT and have not been involved in decisions regarding the
acquisition or the day-to-day operation of IRT's properties or business. We
have, however, discussed the mode of operation of IRT with its officers with a
view to learning information critical to the opinions expressed herein and have
received a certificate from such officers with respect to certain matters. A
copy of each of the officers' certificates is attached. In addition, we have
received the attached letter from Arthur Andersen & Co., IRT's independent
accountants, and have discussed the matters contained therein with Arthur
Andersen & Co.
We have discussed with management of IRT arrangements relating to the
management of its properties, the relationships of IRT with tenants of such
properties, certain terms of leases of such properties to tenants, and the
terms of various notes and related security instruments, all with a view to
assuring that at the close of each quarter of the taxable year covered by this
opinion it met the asset composition requirements set forth in Code Section
856(c)(5), and with a view to assuring that, with respect to the years ended
December 31, 1987 through 1995 (and as projected by IRT management for 1996),
it satisfied the 95%, 75%, and 30% gross income tests set forth in Code
Sections 856(c)(2), (3), and (4). We have further reviewed with management of
IRT the requirements that the beneficial ownership of a REIT be held by 100 or
more persons for at least 335/365ths of each taxable year and that a REIT must
satisfy the diversity of ownership requirements of Code Subsection 856(h) as
such requirements existed in the years covered by this opinion, and we have
been advised by management that at all times during the period covered by this
opinion (and specifically on each record date for the payment of dividends
during such period) IRT has had more than 2,000 shareholders of record, that
IRT maintains the records required by Treasury Regulation Section 1.857-8, that
no later than January 30 of each year it sent the demand required by Treasury
Regulation Section 1.857-8(d) to each shareholder of record owning 5% or more
of the outstanding shares of IRT on the appropriate date required by said
Regulation, and that management has received no indication (whether in response
to the aforesaid demand, as a result of any filing of a Schedule 13D or 13G
under the Securities Exchange Act of 1934, as amended, or otherwise) that the
actual ownership of shares of IRT was or is such as to prevent IRT from
satisfying the applicable requirements of Code Subsection 856(h). Further, we
have selectively examined various property leases and notes secured by property
owned by IRT that management has identified to us as being representative of
its leases and notes and have reviewed summaries of additional leases prepared
and provided to us by IRT. We note that we have not independently verified the
correctness of IRT's reporting of income and expense for tax or financial
accounting purposes, though in the
<PAGE> 4
course of our examination, nothing lead us to question IRT's computation of its
income or expense. On the basis of discussions with management of IRT, we are
not aware that IRT's election to be a REIT has been terminated or challenged by
the Internal Revenue Service or any other party for any year prior to 1987 or
that IRT has revoked its election to be a REIT for any such prior year so as to
make IRT ineligible under Code Subsection 856(g)(3) to elect to be a REIT for
1987.
In rendering the opinions set forth herein, we are assuming that copies of
documents examined by us are true copies of originals thereof and that the
information concerning IRT set forth in IRT's Federal income tax returns, and
in the Prospectus, as well as the information provided us by IRT's management
and its independent accountants are true and correct. We have no reason to
believe that such assumptions are not warranted.
Based solely upon the foregoing examination and information, upon which
you have permitted us to rely, and subject to the limitation set forth below,
we are of the opinion that IRT was a "real estate investment trust" as defined
by Code Subsection 856(a) for its taxable years ended December 31, 1987 through
1995 and that IRT also is in a position to continue its qualification as a
"real estate investment trust" within the definition of Code Section 856(a) for
its taxable year that will end December 31, 1996. Our opinion with respect to
the taxable year ended December 31, 1995 is limited to the extent that the 1995
U.S. income tax return and the supporting tax workpapers were not available for
the completion of our review and issues not otherwise identified at this time
that could adversely affect the determination of IRT's status as a "real estate
investment trust" could arise in the preparation of such tax return. In
addition, with respect to the 1996 year, we note that IRT's status as a real
estate investment trust at any time during such year is dependent, among other
things, upon its meeting the requirements of Section 856 throughout the year
and for the year as a whole. Accordingly, it is not possible to assure that
IRT is a real estate investment trust at any specific time during 1996.
In addition, we have participated in the preparation of the material under
the heading "Certain Federal Income Tax Considerations to the Company of Its
REIT Election" in the Prospectus and we are of the opinion that the federal
income tax treatment described therein is accurate.
<PAGE> 5
This opinion is limited to the specific matters covered hereby and should
not be interpreted to imply that the undersigned has offered its opinion on any
other matter. This opinion may only be relied upon by the parties to whom it
is addressed.
Very truly yours,
ALSTON & BIRD
By: /s/ Pinney L. Allen
-----------------------
Pinney L. Allen
<PAGE> 1
EXHIBIT 23
CONSENT OF ARTHUR ANDERSEN LLP
<PAGE> 2
REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in the Prospectus Supplement dated March 21, 1996, of our report
dated January 23, 1996, included in IRT Property Company's Form 10-K, as
amended, for the year ended December 31, 1995 and to all references to our Firm
in the Prospectus Supplement.
ARTHUR ANDERSEN LLP
Atlanta, Georgia
March 25, 1996
