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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
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Date of Report (Date of earliest event reported): December 10, 1996
Merry Land & Investment Company, Inc.
(Exact name of registrant as specified in its charter)
Georgia 001-11081
(State or other jurisdiction of incorporation) (Commission File Number)
58-0961876
(I.R.S. Employer I.D. Number)
624 Ellis Street, Augusta, Georgia 30901
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 706/722-6756
____________________________________________________________
(Former name or former address, if changed since last report)
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Filed: December 10, 1996
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ITEM 5. OTHER EVENTS. Merry Land & Investment Company, Inc. (the
"Company") has completed the offering of its 8.29% Series D Cumulative
Redeemable Preferred Stock (the "Series D Preferred Stock"). The offering
of the Series D Preferred Stock was made pursuant to a Prospectus
Supplement dated December 5, 1996 relating to the Prospectus dated January
22, 1996 filed with the Company's shelf registration statement #33-65067 on
Form S-3.
Dividends on the shares of Series D Preferred Stock will be cumulative
from the date of original issue and will be payable quarterly in arrears on
the last day of March, June, September and December of each year in an
amount per share equal to $4.145 per annum. The first record date for
determination of shareholders entitled to receive dividends on the Series D
Preferred Stock is December 16, 1996.
Shares of the Series D Preferred Stock are not convertible at any time
and are not listed on any stock exchange.
The Series D Preferred Stock is not redeemable prior to December 10,
2026. On or after December 10, 2026, the Series D Preferred Stock may be
redeemed for cash at the option of the Company in whole or in part and at a
redemption price of $50.00 per share plus accrued and unpaid dividends, if
any, thereon. The redemption price other than the portion thereof
consisting of accrued and unpaid dividends is payable solely out of the
sale proceeds of other capital stock of the Company. The Series D
Preferred Stock will not be entitled to the benefit of any sinking fund.
The net proceeds to the Company from the sale of the shares of the
Series D Preferred Stock are estimated at approximately $48.7 million. The
Company intends to use the net proceeds to acquire and develop additional
apartment properties. Pending such uses, the Company intends to invest
temporarily the excess proceeds in interest bearing securities.
Delivery of the shares of Series D Preferred Stock was made through
the facilities of DTC on December 10, 1996.
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 this Offering.
A. EXHIBIT 1: Underwriting Agreement.
B. EXHIBIT 4: Articles of Amendment to Articles of Incorporation
C. EXHIBIT 5: Opinion as to the legality of the shares.
D. EXHIBIT 8: Tax Opinion.
E. EXHIBIT 12: Statement regarding computation of ratios
(incorporated herein by reference to Exhibit 12 of
the Company's 1995 10-K filed February 21, 1996)
F. EXHIBIT 23: Consent of Hull, Towill, Norman & Barrett, P.C.
(contained in Exhibits 5 and 8)
G. EXHIBIT 27: Financial Data Schedule (incorporated herein by
reference to Exhibit 27 of the Company's 1995 10-K
filed February 21, 1996)
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Signature Blocks on Following Page
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SIGNATURE
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Merry Land & Investment
Company, Inc.
(Registrant)
By: /s/
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Dorrie E. Green
As Its Vice President
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MERRY LAND & INVESTMENT COMPANY, INC.
Series D Cumulative Redeemable Preferred Stock
Underwriting Agreement
December 5, 1996
J.P. Morgan Securities, Inc.
60 Wall Street
New York, NY 10260-0060
Dear Sirs:
Merry Land & Investment Company, Inc., a Georgia corporation (the "Company"),
proposes to issue and sell to J.P. Morgan Securities, Inc. (the "Underwriter"),
1,000,000 shares of 8.29% Series D Cumulative Redeemable Preferred Stock having
the terms set forth on Schedule I hereto (the "Securities").
The Company has prepared and filed with the Securities and Exchange Commission
(the "Commission") in accordance with the provisions of 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
securities (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
first used to confirm sales of the Securities 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 the Registration Statement,
the Basic Prospectus, any preliminary prospectus or the Prospectus shall be
deemed to refer to and inclde 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 Securities at a purchase price
set forth on Schedule I hereto.
2. The Company understands that the Underwriter intends (i) to make a public
offering 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. The time and date of
such payment and delivery with respect to the Securities are referred to herein
as the Closing Date. The certificates for the Securities will be made available
for inspection and packaging by you by 1:00 P.M. on the Business Day prior to
the Closing Date at such place in New York City as you 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 if the Company shall have furnished any amendments or supplements
thereto) comply, or will comply, as the case may be, in all material respects
with the Securities Act, and do not and will not, as of the applicable effective
date as to the Registration Statement and 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 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 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 financial statements and the related notes thereto, included or
incorporated by reference in the Registration Statement and the Prospectus,
present fairly the financial position of the Company 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, 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; and the pro forma
financial information, if any, and the related notes thereto, included or
incorporated by reference in the Registration Statement and the Prospectus has
been prepared in accordance with the applicable requirements of the Securities
Act and the Exchange Act, as applicable;
(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, stockholders" equity or results of operations of
the Company, otherwise than as set forth or contemplated in the Prospectus; and
except as set forth or contemplated in the Prospectus the Company has not
entered into any transaction or agreement (whether or not in the ordinary course
of business) material to the Company;
(e) the Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the state of its incorporation,
with power and authority (corporate and other) to own or lease its properties
and conduct its business 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 have a material adverse effect on the Company and its
subsidiaries taken as a whole; except for investments in securities 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; the subsidiary entities of the
Company identified on Schedule II hereto (the "Subsidiaries") have been duly
organized and are validly existing as corporations or limited partnerships, as
the case may be, in good standing under the laws of their states of
organization, and have been duly qualified as foreign corporations or limited
partnerships, as the case may be, for the transaction of business and are in
good standing under the laws of each other jurisdiction in which they own or
lease properties, or conduct 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 on the Company and the Subsidiaries taken as a
whole; except 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;
(f) this Agreement has been duly authorized, executed and delivered by the
Company and constitutes the valid and legally binding obligation of the Company
enforceable in accordance with its terms, except as rights to indemnity and
contribution hereunder may be limited by applicable law;
(g) the outstanding shares of Common Stock and Preferred Stock of the
Company have been duly authorized and validly issued and are fully paid and
non-assessable;
(h) the Securities have been duly and validly authorized and, when issued
and delivered against payment therefor as provided herein, will be duly and
validly issued and fully paid and non-assessable and will conform to the
description of the Series D Cumulative Redeemable Preferred Stock contained in
the Prospectus; and the terms of the Articles of Amendment with respect to the
Securities (the "Articles of Amendment"), will be valid and binding on the
Company; and the holders of outstanding capital stock of the Company are not
entitled to preemptive or other rights afforded by the Company to subscribe for
the Securities;
(i) neither the Company nor any of the Subsidiaries is, nor with the
giving of notice or lapse of time or both would be, in violation of or in
default under, their respective Articles of Incorporation, By-Laws or formation
documents or any indenture, mortgage, deed of trust, loan agreement or other
agreement or other instrument or obligation to which the Company or any
Subsidiary is a party or by which they or any of their properties are bound,
except for violations and defaults which individually and in the aggregate are
not material to the Company or to the holders of the Securities; the issue and
sale of the Securities, by the Company and the compliance by the Company with
all of the provisions of the Articles of Amendment and provisions of 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 to which the
Company or any Subsidiary is a party or by which the Company or any Subsidiary
is bound or to which any of the property or assets of the Company or any
Subsidiary 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, except the filing of
the Articles of Amendment with the Secretary of State of Georgia and such
consents, approvals, authorizations, registrations or qualifications as have
been obtained under the Securities Act, and as may be require 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 Subsidiary is or may be a party
or to which any property of the Company or any Subsidiary 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 on the
general affairs, business, prospects, management, properties, financial
position, stockholders" equity or results of operations of the Company 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;
(k) the Company and the Subsidiaries have good and marketable title to all
of the properties and assets reflected in the financial statements (or as
described in the Registration Statement) hereinabove described, subject to no
lien, mortgage, pledge, charge or encumbrance of any kind except those reflected
in such financial statements (or as described in the Registration Statement) or
which are not material in amount. The Company and the Subsidiaries occupy their
leased properties under valid and binding leases conforming to the description
thereof set forth in the Registration Statement;
(l) 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;
(m) the Company and the Subsidiaries hold all material licenses,
certificates and permits from governmental authorities which are necessary to
the conduct of their business; and the Company has not infringed any patents,
patent rights, trade names, trademarks or copyrights, which infringement is
material to the business of the Company;
(n) Arthur Andersen LLP, which has certified certain of the financial
statements filed with the Commission as part of, or incorporated by reference
in, the Registration Statement, are independent public accountants as required
by the Securities Act;
(o) the Company has never been, is not now, and immediately after the sale
of the Securities under this Agreement will not be, an "investment company"
within the meaning of the Investment Company Act of 1940, as amended;
(p) 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 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;
(q) 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 the transactions contemplated herein;
and
(r) the Company"s Common Stock, its Series A Cumulative Convertible
Preferred Stock and Series C Cumulative Convertible Preferred Stock are listed
on the New York Stock Exchange.
5. The Company covenants and agrees with the Underwriter as follows:
(a) to file the Prospectus in a form approved by you 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 you may reasonably request, when filed with Commission;
(c) from the date hereof and prior to the Closing Date, to furnish to you
a copy of any proposed amendment or supplement to the Registration Statement or
the Prospectus, for your review, and not to file any such proposed amendment or
supplement to which you reasonably object;
(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 connection with the offering or sale of
the Securities, and during such same period, to advise you 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) to prepare and file Articles of Amendment setting forth the terms of
the Securities on a basis consistent with the terms set forth on Schedule I
hereto (and otherwise in a form reasonably acceptable to the Underwriter and its
counsel) and file the same with the Secretary of State of George on or before
the Closing Date;
(f) 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 an Underwriter or 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 you will furnish to the Company) to which Securities may
have been sold by you 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 when the Prospectus is delivered to a purchaser,
be misleading or so that the Prospectus will comply with law;
(g) to endeavor to qualify the Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions as you 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 you may designate; provided that the Company shall not
be required to file a general consent to service of process in any
jurisdiction;
(h) to make generally available to its security holders and to you as soon
as practicable but not later than 15 months after the effective date of the
Registration Statement (as defined in Rule 158(c)) 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 of the Commission promulgated thereunder;
(i) so long as the Securities are outstanding, to furnish to you copies of
all reports or other communications (financial or other) furnished to holders of
Securities, and copies of any reports and financial statements furnished to or
filed with the Commission or any national securities exchange;
(j) 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 securities of the Company which are
substantially similar to the Securities without your prior written consent; and
(k) 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 and delivery of the Securities, (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 their
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
Preliminary and Supplemental Blue Sky Memoranda and any Legal Investment Survey
and the furnishing to Underwriter 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 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;
(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 your satisfaction;
(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 material adverse change, in or affecting the general
affairs, business, prospects, management, properties, financial position,
stockholders" equity or results of operations of the Company and the
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 an executive officer of the Company satisfactory to you 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, stockholders" equity or results of operations of the Company and the
Subsidiaries taken as a whole from that set forth or contemplated in the
Registration Statement;
(f) Hull, Towill, Norman & Barrett, P.C., counsel for the Company, shall
have furnished to you its written opinion, dated the Closing Date, in form and
substance satisfactory to you, 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 its jurisdiction of
incorporation, with power and authority (corporate and 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 on
the Company;
(iii) the Subsidiaries have been duly organized and are validly
existing as corporations or limited partnerships, as the case may be, in good
standing under the laws of their jurisdictions of organization, with power and
authority to own their properties and conduct their business as described in the
Prospectus as amended or supplemented;
(iv) the Subsidiaries have been duly qualified as foreign corporations
or limited partnerships, as the case may be, for the transaction of business and
are in good standing under the laws of each other jurisdiction in which they own
or lease properties, or conduct 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 on the Company;
(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 the Subsidiaries is or
may be a party or to which any property of the Company or the Subsidiaries is or
may be the subject which, if determined adversely to the Company or the
Subsidiaries, could individually or in the aggregate reasonably be expected to
have a material adverse effect on the general affairs, business, prospects,
management, properties, financial position, stockholders" equity or results of
operations of the Company; 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 described in the Registration Statement or the
Prospectus which are not filed or described as required;
(vi) this Agreement has been duly authorized, executed and delivered
by the Company and is a valid and binding agreement of the Company, except as
rights to indemnity and contribution hereunder may be limited by applicable
law;
(vii) the Securities have been duly and validly authorized, and
when issued and delivered to and paid for by the Underwriter in accordance with
the terms of this Agreement, will be duly and validly issued and fully paid and
nonassessable and will conform to the description thereof contained in the
Prospectus; and the terms of the Articles of Amendment with respect to the
Securities are valid and binding on the Company; and the holders of outstanding
capital stock of the Company are not entitled to preemptive or other rights
afforded by the Company to subscribe for the Securities;
(viii) neither the Company nor the Subsidiaries are, nor with the
giving of notice or lapse of time or both would be, in violation of or in
default under, their respective Articles of Incorporation or By-Laws or any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of the Subsidiaries
is a party or by which they or any of their respective properties are bound,
except for violations and defaults which individually and in the aggregate are
not material to the Company or to the holders of the Securities; the issue and
sale of the Securities and the compliance by the Company with the provisions of
the Articles of Amendment with respect to the Securities and provisions of 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 Subsidiary is a party or by which the
Company or any Subsidiary is bound or to which any of the property or assets of
the Company or any Subsidiary 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;
(ix) the Company has authorized and outstanding stock as set forth
under the caption "Capitalization" in the Prospectus;
(x) each consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body necessary in
connection with the issuance and sale of the Securities or the consummation of
the other transactions contemplated by this Agreement, (except such consents,
approvals, authorizations, registrations or qualifications as have been obtained
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) has
been obtained or made and is in full force and effect;
(xi) the statements in the Prospectus under the captions "Description
of Series D Preferred Stock," "Description of Securities," "Description of Debt
Securities," "Description of Common Stock," "Description of Preferred Stock,"
"Description of Common Stock Warrants," and "Description of Depositary Shares"
in the Prospectus and each document incorporated by reference from Item 3 of
Part 1 of the Company"s Annual Report on Form 10-K for the year ended December
31, 1995 and 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;
(xii) such counsel (A) is of the opinion that each document
incorporated by reference in the Registration Statement and the Prospectus
(except for the financial statements included therein as to which such counsel
need express no opinion) complied as to form in all material respects with the
Exchange Act when filed with Commission, (B) believes that (except for the
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 financial
statement 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 (D) believes that (except for the financial statements
included therein as to which such counsel need express no belief) the
Registration Statement and the Prospectus, 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
not misleading, and that the Prospectus as amended or supplemented, if
applicable, 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
(xiii) 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 1988.
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
the States 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 the 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 (other than the documents incorporated by reference therein) and review
and discussion of the contents thereof (including the documents incorporated by
reference therein) but is without independent check or verification except as
specified.
(g) Hull, Towill, Norman & Barrett, P.C., tax counsel for the Company,
shall have delivered to you its written opinion, dated the Closing Date, in form
and substance satisfactory to you, to the effect that:
(i) the Company met the requirements for qualification and taxation
as a real estate investment trust ("REIT") for the taxable years 1990, 1991,
1992, 1993, 1994 and 1995 ;
(iii) the discussion contained under the caption "Taxation " in
the Prospectus forming a part of the Registration Statement, accurately reflects
existing law and fairly addresses the material federal income tax issues
described therein.
In rendering such opinions, Hull, Towill, Norman & Barrett, P.C. may rely
as to matters of fact, to the extent they deem proper, on certificates of
officers of the Company and public officials so long as such counsel states that
no facts have come to the attention of such counsel which lead them to believe
that they are not justified in relying on such certificates. In addition, Hull,
Towill, Norman & Barrett, P.C. may state that their opinions are based upon the
procedures and assumptions set forth in such opinion letter and that it is
limited to the tax matters specifically covered thereby and that they have not
addressed any other tax consequences.
(h) on the Closing Date, Arthur Andersen LLP shall have furnished to you
letters, dated such date, in form and substance satisfactory to you, containing
statements and information of the type customarily included in accountants
"comfort letters" to Underwriter with respect to the financial statements and
certain financial information contained in the Registration Statement and the
Prospectus;
(i) on the Closing Date, Arthur Andersen LLP shall have furnished to you a
letter confirming the matters set forth in clauses (i) and (ii) of subparagraph
(g) of this Section 6;
(j) you shall have received on and as of the Closing Date an opinion of
Piper & Marbury L.L.P., counsel to the Underwriter, with respect to the validity
of 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
(k) 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 Piper & Marbury L.L.P., 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 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, 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.
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 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 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. 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 cntrol persons of the
Company or authorized representatives 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. Notwithstanding the
foregoing sentence, if at any time an Indemnified Person shall have requested an
Indemnifying Person to reimburse the Indemnified Person for fees and expenses of
counsel as contemplated by the third sentence of this paragraph, the
Indemnifying Person agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 30 days after receipt by such Indemnifying Person of the
aforesaid request and (ii) such Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of such
settlement. 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
deducting 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
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 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 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) nor has any notice been given of
any intended or potential downgrading or 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; 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, on the Closing Date, the Underwriter shall fail or refuse to purchase
Securities and the aggregate principal amount of Securities with respect to
which such default occurs is more than one-tenth of the aggregate principal
amount of Securities to be purchased, and arrangements satisfactory to you and
the Company for the purchase of such Securities are not made within 36 hours
after such default, this Agreement shall terminate without liability on the part
of the Company. In any such case either you or the Company shall have the right
to postpone the Closing Date, but in no event for longer than seven days, in
order that the required changes, if any, in the Registration Statement and in
the Prospectus or in any other documents or arrangements may be effected. Any
action taken under this paragraph shall not relieve the Underwriter from
liability in respect of any default of the Underwriter under this Agreement.
10. 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.
11. This Agreement shall inure to the benefit of and be 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.
12. 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 at 60 Wall
Street, New York, New York 10260. Notices to the Company shall be given to it
at Merry Land & Investment Company, Inc., 624 Ellis Street, Augusta, Georgia
30901, Attention: W. Tennent Houston.
13. 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.
<PAGE>
Very truly yours,
MERRY LAND & INVESTMENT COMPANY, INC.
By:_______________________________________
Name: W. Tennent Houston
Title: Acting Chief Executive Officer
Accepted: December 5, 1996
J.P. MORGAN SECURITIES INC.
By:______________________________
Name:
Title:
<PAGE>
SCHEDULE I
Underwriter: J.P. Morgan Securities Inc.
Underwriting Agreement
dated: December 5, 1996
Registration Statement No.: 33-65067
Title of Securities: 8.29% Series D Cumulative
Redeemable Preferred Stock
Amount: 1,000,000 shares
Price to Public: $50.00
Underwriting Discount: 2.5%
Dividends: Cumulative from date of issue at 8.29% per annum
Dividend Dates: March 31, June 30, September 30, December 31
Redemption Provisions: Not redeemable prior to December 10, 2026, after
which redeemable at the option of the Company at
$50.00 plus accrued and unpaid dividends, solely
from the proceeds of the sale of capital stock
Liquidation Preference: $50.00 per share plus accrued and unpaid
dividends
Voting Rights: None, except if dividends in arrears for six
quarterly periods (whether or not consecutive)
Ranking: Senior to common; on parity with Company"s
existing preferred stock
Other Provisions: Not convertible or exchangeable
Closing Date and
Time of Delivery: December 10, 1996, 10:00 a.m.
Closing Location: Piper & Marbury L.L.P.
36 South Charles Street
Baltimore, Maryland 21201
Address for Notices
to Underwriter: c/o J.P. Morgan Securities Inc.
60 Wall Street
New York, New York 10260
<PAGE>
SCHEDULE II
Subsidiaries
ML Apartments Limited
Merry Land Apartment Communities, Inc.
ML Texas Apartments L.P.
ML North Carolina Apartments, L.P.
ML Tennessee Apartments, L.P.
ML Alabama Apartments, Inc.
ARTICLES OF AMENDMENT TO
ARTICLES OF INCORPORATION OF
MERRY LAND & INVESTMENT COMPANY, INC.
RE: SERIES D CUMULATIVE REDEEMABLE PREFERRED STOCK
1. The name of the corporation is Merry Land & Investment Company, Inc.
2. This Amendment was adopted by the Board of Directors. Pursuant to the
provisions of Section 14-2-602 Official Code of Georgia Annotated,
no shareholder action was required.
3. This Amendment was adopted on December 5, 1996.
4. The text of this Amendment is as follows:
FIRST: Pursuant to authority expressly vested in the Board of Directors
of the Corporation by Article Five of the Articles of Incorporation, as amended
(the "Articles"), the Board of Directors on June 22, 1993, duly divided and
classified 4,600,000 shares of the Preferred Stock of the Corporation, without
par value, into a class designated Series A Cumulative Convertible Preferred
Stock (the "Series A Preferred Stock"), and provided for the issuance of
such Series A Preferred Stock.
SECOND: On October 31, 1994, the Board of Directors duly divided and
classified 4,000,000 shares of Preferred Stock of the Corporation, without par
value, into a class of Series B Cumulative Convertible Preferred Stock
("the Series B Preferred Stock"), and provided for the issuance of such Series
B Stock.
THIRD: On March 7, 1995, the Board of Directors duly divided and
classified 4,600,000 shares of the Preferred Stock of the Corporation, without
par value, into a class of Series C Cumulative Convertible Preferred Stock
("the Series C Preferred Stock"), and provided for the issuance of such
Series C Preferred Stock.
FOURTH: The Board of Directors has now duly divided and classified
1,000,000 shares of Preferred Stock of the Corporation, without par value, into
a class of Series D Cumulative Redeemable Preferred Stock and provided for the
issuance of such Series D Cumulative Redeemable Preferred Stock.
FIFTH: The terms of the Series D Cumulative Redeemable Preferred Stock
established by the Board of Directors, in addition to those set forth in
Article FIVE of the Articles of the Corporation are as follows:
ARTICLE V-D
Section 1. Number of Shares and Designation. This series of Preferred
Stock shall be designated as Series D Cumulative Redeemable Preferred Stock
(the "Series D Preferred Stock") and 1,000,000 shall be the number of shares of
Preferred Stock constituting such series.
Section 2. Definitions. For purposes of the Series D Preferred Stock,
the following terms shall have the meanings indicated:
"Board of Directors" shall mean the Board of Directors of the Corporation
or any committee authorized by such Board of Directors to perform any of its
responsibilities with respect to the Series D Preferred Stock.
"Business Day" shall mean any day other than a Saturday, Sunday or a day on
which state or federally chartered banking institutions in Augusta,
Georgia or New York, New York are not required to be open.
"Call Date" shall have the meaning set forth in paragraph (c) of Section 5
hereof.
"Common Stock" shall mean the common stock of the Corporation, without par
value.
"Dividend Payment Date" shall mean the last calendar day of March, June,
September and December, in each year, commencing on December 31, 1996;
provided, however, that if any Dividend Payment Date falls on any day
other than a Business Day, the dividend payment due on such Dividend
Payment Date shall be paid no later than the Business Day immediately
following such Dividend Payment Date.
"Dividend Periods" shall mean quarterly dividend periods commencing on
January 1, April 1, July 1 and October 1 of each year and ending on and
including the day preceding the first day of the next succeeding Dividend
Period (other than the initial Dividend Period, which shall commence on
the Issue Date and end on and include December 31, 1996).
"Issue Date" shall mean the date on which the Corporation first issues a
share of Series D Preferred Stock.
"Junior Stock" shall mean the Common Stock and any other class or series of
shares of the Corporation over which the Series D Preferred Stock has
preference or priority in the payment of dividends or in the distribution
of assets on any liquidation, dissolution or winding up of the Corporation.
"Parity Stock" shall have the meaning set forth in paragraph (b) of
Section 8 hereof.
"Person" shall mean any individual, firm, partnership, corporation or
other entity, and shall include any successor (by merger or otherwise) of
such entity.
"Press Release" shall have the meaning set forth in paragraph (b) of
Section 5 hereof.
"Series A Preferred Stock" shall mean the $1.75 Series A Cumulative
Convertible Preferred Stock, liquidation preference $25.00 per share,
authorized on June 22,1993, which is, from time to time, outstanding.
"Series B Preferred Stock" shall mean the $2.205 Series B Cumulative
Convertible Preferred Stock, liquidation preference $25.00 per share,
authorized on October 31, 1994, which is, from time to time, outstanding.
"Series C Preferred Stock" shall mean the $2.15 Series C Cumulative
Convertible Preferred Stock, liquidation preference $25.00 per share,
authorized on March 7,1995, which is, from time to time, outstanding.
"Series D Preferred Stock" shall have the meaning set forth in Section 1
hereof.
"set apart for payment" shall be deemed to include, without any action
other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates,
pursuant to a declaration of dividends or other distribution by the Board
of Directors, the allocation of funds to be so paid on any series or class
of capital stock of the Corporation; provided, however, that if any funds
for any class or series of Junior Stock or any class or series of stock
ranking on a parity with the Series D Preferred Stock as to the payment
of dividends are placed in a separate account of the Corporation or
delivered to a disbursing, paying or other similar agent, then "set apart
for payment" with respect to the Series D Preferred Stock shall mean
placing such funds in a separate account or delivering such funds to a
disbursing, paying or other similar agent.
"Transfer Agent" means First Union National Bank, Charlotte, North
Carolina, or such other agent or agents of the Corporation as may be
designated by the Board of Directors or their designee as the transfer
agent for the Series D Preferred Stock.
"Voting Preferred Stock" shall have the meaning set forth in Section 9
hereof.
Section 3. Dividends. (a) The holders of shares of the Series
D Preferred Stock shall be entitled to receive, when, as and if declared
by the Board of Directors, out of funds legally available for that purpose,
dividends payable in cash in an amount per share of Series D Preferred
Stock equal to $4.145 per annum. Such dividends shall be cumulative from
the Issue Date, whether or not in any Dividend Period or Periods there
shall be funds of the Corporation legally available for the payment of
such dividends, and shall be payable quarterly, when, as and if declared
by the Board of Directors, in arrears on Dividend Payment Dates,
commencing on December 31, 1996. Each such dividend shall be payable in
arrears to the holders of record of shares of the Series D Preferred
Stock, as they appear on the stock records of the Corporation at the close
of business on such record dates, which shall be on or about the 15th day
of the calendar months in which the Dividend Payment Dates fall or such
other dates not less than 10 days nor more than 60 days preceding such
Dividend Payment Dates thereof, as shall be fixed by the Board of
Directors. Accrued and unpaid dividends for any past Dividend Periods may
be declared and paid at any time, without reference to any regular
Dividend Payment Date, to holders of record on such date, not exceeding
45 days preceding the payment date thereof, as may be fixed by the Board
of Directors.
(b) The amount of dividends payable for each full Dividend Period for the
Series D Preferred Stock shall be computed by dividing the annual dividend
rate by four. The amount of dividends payable for any period shorter or
longer than a full Dividend Period, on the Series D Preferred Stock shall
be computed on the basis of twelve 30-day months and a 360-day year.
Holders of shares of Series D Preferred Stock shall not be entitled to any
dividends, whetherpayable in cash, property or stock, in excess of
cumulative dividends, as herein provided, on the Series D Preferred
Stock. No interest, or sum of money in lieu of interest, shall be payable
in respect of any dividend payment or payments on the Series D Preferred
Stock that may be in arrears.
(c) So long as any shares of the Series D Preferred Stock are
outstanding, no dividends, except as described in the immediately
following sentence, shall be declared or paid or set apart for payment on
any class or series of Parity Stock for any period unless full cumulative
dividends have been or contemporaneously are declared and paid or declared
and a sum sufficient for the payment thereof set apart for such payment on
the Series D Preferred Stock for all Dividend Periods terminating on or
prior to the Dividend Payment Date on such class or series of Parity
Stock. When dividends are not paid in full or a sum sufficient for such
payment is not set apart, as aforesaid, all dividends declared upon shares
of the Series D Preferred Stock and all dividends declared upon any other
class or series of Parity Stock shall be declared ratably in proportion to
the respective amounts of dividends accumulated and unpaid on the Series D
Preferred Stock and accumulated and unpaid on such Parity Stock.
(d) So long as any shares of the Series D Preferred Stock are outstanding,
no dividends (other than dividends or distributions paid in shares of, or
options, warrants or rights to subscribe for or purchase shares of, Junior
Stock), shall be declared or paid or set apart for payment or other
distribution declared or made upon Junior Stock, nor shall Junior Stock be
redeemed, purchased or otherwise acquired (other than a redemption,
purchase or other acquisition of shares of Common Stock made for purposes
of an employee incentive or benefit plan of the Corporation or any
subsidiary) for any consideration (or any moneys be paid to or made
available for a sinking fund for the redemption of any shares of any
such stock) by the Corporation, directly or indirectly (except by
conversion into or exchange for Junior Stock), unless in each case (i)
the full cumulative dividends on all outstanding shares of the Series D
Preferred Stock and any other Parity Stock of the Corporation shall have
been paid or set apart for payment for all past Dividend Periods with
respect to the Series D Preferred Stock and all past dividend periods
with respect to such Parity Stock and (ii) sufficient funds shall have
been paid or set apart for the payment of the dividend for the current
Dividend Period with respect to the Series D Preferred Stock and the
current dividend period with respect to such Parity Stock.
Section 4. Liquidation Preference. (a) In the event of any
liquidation, dissolution or winding up of the Corporation, whether
voluntary or involuntary, before any payment or distribution of the
assets of the Corporation (whether capital or surplus) shall be made to
or set apart for the holders of Junior Stock, the holders of the shares
of Series D Preferred Stock shall be entitled to receive Fifty Dollars
($50.00) per share of Series D Preferred Stock plus an amount equal to
all dividends (whether or not earned or declared) accrued and unpaid
thereon to the date of final distribution to such holders; but such
holders shall not be entitled to any further payment. If, upon any
liquidation, dissolution or winding up of the Corporation, the assets
of the Corporation, or proceeds thereof, distributable among the holders
of the shares of Series D Preferred Stock shall be insufficient to pay in
full the preferential amount aforesaid and liquidating payments on any
other shares of any class or series of Parity Stock, then such assets, or
the proceeds thereof, shall be distributed among the holders of shares of
Series D Preferred Stock and any such other Parity Stock ratably in
accordance with the respective amounts that would be payable on such
shares of Series D Preferred Stock and any such other Parity Stock if all
amounts payable thereon were paid in full. For the purposes of this
Section 4, (i) a consolidation or merger of the Corporation with one or
more corporations, (ii) a sale or transfer of all or substantially all of
the Corporation's assets, or (iii) a statutory share exchange shall not be
deemed to be a liquidation, dissolution or winding up, voluntary or
involuntary, of the Corporation.
(b) Subject to the rights of the holders of shares of any series or class
or classes of stock ranking on a parity with or prior to the Series D
Preferred Stock upon liquidation, dissolution or winding up, upon any
liquidation, dissolution or winding up of the Corporation, after payment
shall have been made in full to the holders of the Series D Preferred
Stock, as provided in this Section 4, any other series or class or classes
of Junior Stock shall, subject to the respective terms and provisions (if
any) applying thereto, be entitled to receive any and all assets remaining
to be paid or distributed, and the holders of the Series D Preferred Stock
shall not be entitled to share therein.
Section 5. Redemption at the Option of the Corporation. (a) The
Series D Preferred Stock shall not be redeemable by the Corporation prior to
December 10, 2026. On and after December 10, 2026, the Corporation, at its
option, may redeem the shares of Series D Preferred Stock in whole or in part,
as set forth herein, subject to the provisions described below.
(b) No share of Series D Preferred Stock may be redeemed except from
proceeds from the sale of other capital stock of the Corporation, including but
not limited to common stock, preferred stock, depositary shares, interests,
participations or other ownership interests (however designated) and any rights
(other than debt securities convertible into or exchangeable for equity
securities) or options to purchase any of the foregoing. In order to exercise
its redemption option, the Corporation must issue a press release announcing
the redemption (the "Press Release"). The Press Release shall announce the
redemption and set forth the number of shares of Series D Preferred Stock which
the Corporation intends to redeem. The Call Date shall be selected by
the Corporation, shall be specified in the notice of redemption and shall be
not less than 30 days or more than 60 days after the date on which the
Corporation issues the Press Release.
(c) Upon redemption of Series D Preferred Stock by the Corporation on the
date specified in the notice to holders required under subparagraph (e) of this
Section 5 (the "Call Date"), for each share of Series D Preferred Stock so
redeemed, the Corporation shall pay in cash the liquidation preference,
including all dividends (whether or not earned or declared) accrued
and unpaid thereon to the Call Date, except that if the Call Date falls after a
dividend payment record date and prior to the corresponding Dividend Payment
Date, then each holder of Series D Preferred Stock at the close of business on
such dividend payment record date shall be entitled to the dividend payable on
such shares on the corresponding Dividend Payment Date notwithstanding the
redemption of such shares before such Dividend Payment Date. Except as
provided above, the Corporation shall make no payment or allowance for unpaid
dividends, whether or not in arrears, on shares of Series D Preferred Stock
called for redemption, after the date of redemption.
(d) If full cumulative dividends on the Series D Preferred Stock and any
other class or series of Parity Stock of the Corporation have not been paid or
declared and set apart for payment, the Series D Preferred Stock may not be
redeemed in part and the Corporation may not purchase or acquire shares of
Series D Preferred Stock, otherwise than pursuant to a purchase or exchange
offer made on the same terms to all holders of shares of Series D Preferred
Stock.
(e) If the Corporation shall redeem shares of Series D Preferred Stock
pursuant to paragraph (a) of this Section 5, notice of such redemption shall be
given not more than four Business Days after the date on which the Corporation
issues the Press Release to each holder of record of the shares to be
redeemed. Such notice shall be provided by first class mail, postage prepaid,
at such holder's address as the same appears on the stock records of the
Corporation, or by publication in a newspaper of general circulation in the
City of New York once per week for at least two successive weeks. If the
Corporation elects to provide such notice by publication, it shall also
promptly mail notice of such redemption to the holders of the Series D
Preferred Stock to be redeemed not less than 30 nor more than 60 days prior to
the Call Date. Neither the failure to mail any notice required by this
paragraph (e), nor any defect therein or in the mailing thereof, to any
particular holder, shall affect the sufficiency of the notice or the validity
of the proceedings for redemption with respect to the other holders. Any
notice which was mailed in the manner herein provided shall be conclusively
presumed to have been duly given on the date mailed whether or not the holder
receives the notice. Each such mailed or published notice shall state, as
appropriate: (1) the Call Date; (2) the number of shares of Series D
Preferred Stock to be redeemed and, if fewer than all the shares held by
such holder are to be redeemed, the number of such shares to be redeemed
from such holder; (3) the redemption price with respect to each
share of Series D Preferred Stock, including dividends accrued through the
Call Date; (4) the place or places at which certificates for such shares are to
be surrendered for payment; and (5) that dividends on the shares to be
redeemed shall cease to accrue on such Call Date except as otherwise provided
herein. Notice having been published or mailed as aforesaid, from and after
the Call Date (unless the Corporation shall fail to make available the amount
of cash necessary to effect such redemption), (i) except as otherwise provided
herein, dividends on the shares of the Series D Preferred Stock so called for
redemption shall cease to accrue, (ii) said shares shall no longer be deemed to
be outstanding, and (iii) all rights of the holders thereof as holders of
Series D Preferred Stock of the Corporation shall cease (except the rights to
receive the cash payable upon such redemption, without interest thereon, upon
surrender and endorsement of their certificates if so required and to receive
any dividends payable thereon). The Corporation's obligation to provide cash
in accordance with the preceding sentence shall be deemed fulfilled if, on or
before the Call Date, the Corporation shall deposit with a bank or trust
company (which may be an affiliate of the Corporation) that has an office in
the Borough of Manhattan, City of New York, or in Charlotte, North Carolina and
that has, or is an affiliate of a bank or trust company that has, a capital and
surplus of at least $50,000,000, cash necessary for such redemption, in trust,
with irrevocable instructions that cash be applied to the redemption of the
shares of Series D Preferred Stock so called for redemption. At the close of
business on the Call Date, each holder of Series D Preferred Stock to be
redeemed (unless the Company defaults in the delivery of the cash payable on
such Call Date) shall no longer be deemed to be the record holder of the number
of shares of such Series D Preferred Stock to be redeemed, regardless of
whether such holder has surrendered the certificates representing the Series D
Preferred Stock. The Corporation shall be entitled to receive from such bank or
trust company the interest or other earnings, if any, earned on any money so
deposited in trust, and the holders of any shares redeemed shall have no claim
to such interest or other earnings. No interest shall accrue for the benefit
of the holders of Series D Preferred Stock to be redeemed on the cash so set
aside by the Corporation. Subject to applicable escheat laws, any such cash
unclaimed at the end of two years from the Call Date shall revert to the
general funds of the Corporation, after which reversion the holders of such
shares so called for redemption shall look only to the general funds of the
Corporation for the payment of such cash.
As promptly as practicable after the surrender in accordance with said
notice of the certificates for any such shares so redeemed (properly endorsed or
assigned for transfer, if the Corporation shall so require and if the notice
shall so state), the Corporation shall pay the cash (without interest thereon)
representing the redemption price for the redeemed shares. If fewer
than all the outstanding shares of Series D Preferred Stock are to redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding
shares of Series D Preferred Stock not previously called for redemption by lot
or pro rata (as nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable. If fewer than all the
shares of Series D Preferred Stock represented by any certificate are redeemed,
then new certificates representing the unredeemed shares shall be issued
without cost to the holder thereof.
Section 6. Shares To Be Retired.
All shares of Series D Preferred Stock which shall have been issued and
reacquired in any manner by the Corporation shall be restored to the status of
authorized but unissued shares of Preferred Stock, without designation as to
series. The Corporation may also retire any unissued shares of Series D
Preferred Stock, and such shares shall then be restored to the status of
authorized but unissued shares of Preferred Stock, without designation as to
series.
Section 7. Conversion.
Holders of shares of Series D Preferred Stock shall not have the right to
convert all or a portion of such shares into shares of Common Stock or any
other class of stock of the Corporation.
Section 8. Ranking. Any class or series of stock of the Corporation
shall be deemed to rank:
(a) prior to the Series D Preferred Stock, as to the payment of dividends
and as to distribution of assets upon liquidation, dissolution or winding up,
if the holders of such class or series shall be entitled to the receipt of
dividends or of amounts distributable upon liquidation, dissolution or winding
up, as the case may be, in preference or priority to the holders of Series D
Preferred Stock;
(b) on a parity with the Series D Preferred Stock, as to the payment of
dividends and as to distribution of assets upon liquidation, dissolution or
winding up, whether or not the dividend rates, dividend payment dates or
redemption or liquidation prices per share thereof be different from those of
the Series D Preferred Stock, if the holders of such class of stock or series
and the Series D Preferred Stock shall be entitled to the receipt of dividends
and of amounts distributable upon liquidation, dissolution or winding up in
proportion to their respective amounts of accrued and unpaid dividends per
share or liquidation preferences, without preference or priority one over the
other ("Parity Stock"); the Series A Preferred Stock, the Series B Preferred
Stock, and the Series C Preferred Stock shall be Parity Stock with respect to
the Series D Preferred Stock; and
(c) junior to the Series D Preferred Stock, as to the payment of
dividends or as to the distribution of assets upon liquidation, dissolution or
winding up, if such stock or series shall be Common Stock or if the holders of
Series D Preferred Stock shall be entitled to receipt of dividends or of
amounts distributable upon liquidation, dissolution or winding up, as the case
may be, in preference or priority to the holders of shares of such stock or
series.
Section 9. Voting. If and whenever six quarterly dividends (whether
or not consecutive) payable on the Series D Preferred Stock or any series or
class of Parity Stock shall be in arrears (which shall, with respect to any
such quarterly dividend, mean that any such dividend has not been paid in
full), whether or not earned or declared, the number of directors then
constituting the Board of Directors shall be increased by two (if not already
increased by reason of a similar arrearage with respect to any Parity Stock)
and the holders of shares of Series D Preferred Stock, together with the
holders of shares of every other series of Parity Stock (any such other series,
the "Voting Preferred Stock"), voting as a single class regardless of series,
shall be entitled to elect the two additional directors to serve on the Board
of Directors at any annual meeting of stockholders or special meeting held in
place thereof, or at a special meeting of the holders of the Series D
Preferred Stock and the Voting Preferred Stock called as hereinafter provided.
Whenever all arrears in dividends on the Series D Preferred Stock and the
Voting Preferred Stock then outstanding shall have been paid and dividends
thereon for the current quarterly dividend period shall have been paid or
declared and set apart for payment, then the right of the holders of the Series
D Preferred Stock and the Voting Preferred Stock to elect such additional two
directors shall cease (but subject always to the same provision for the vesting
of such voting rights in the case of any similar future arrearages in six
quarterly dividends), and the terms of office of all persons elected as
directors by the holders of the Series D Preferred Stock and the Voting
Preferred Stock shall forthwith terminate and the number of the Board of
Directors shall be reduced accordingly. At any time after such voting power
shall have been so vested in the holders of shares of Series D Preferred Stock
and the Voting Preferred Stock, the secretary of the Corporation may, and upon
the written request of any holder of Series D Preferred Stock (addressed to the
secretary at the principal office of the corporation) shall, call a special
meeting of the holders of the Series D Preferred Stock and of the Voting
Preferred Stock for the election of the two directors to be elected by them as
herein provided, such call to be made by notice similar to that provided in the
Bylaws of the Corporation for a special meeting of the stockholders or as
required by law. If any such special meeting required to be called as above
provided shall not be called by the secretary within 20 days after receipt of
any such request, then any holder of shares of Series D Preferred Stock may call
such meeting, upon the notice above provided, and for that purpose shall have
access to the stock books of the Corporation. The directors elected
at any such special meeting shall hold office until the next annual meeting
of the stockholders or special meeting held in lieu thereof if such office
shall not have previously terminated as above provided. If any vacancy shall
occur among the directors elected by the holders of the Series D Preferred
Stock and the Voting Preferred Stock, a successor shall be elected by the
Board of Directors, upon the nomination of the then-remaining director
elected by the holders of the Series D Preferred Stock and the Voting
Preferred Stock or the successor of such remaining director, to serve until
the next annual meeting of the stockholders or special meeting held in place
thereof if such office shall not have previously terminated as provided above.
So long as any shares of Series D Preferred Stock are outstanding, in
addition to any other vote or consent of stockholders required by law or by
the Articles of Incorporation, as amended, the affirmative vote of at least
66 2/3% of the votes entitled to be cast by the holders of the shares
of Series D Preferred Stock and the Voting Preferred Stock, at the time
outstanding, acting as a single class regardless of series, given in person
or by proxy, either in writing without a meeting or by vote at any meeting
called for the purpose, shall be necessary for effecting or validating:
(a) Any amendment, alteration or repeal of any of the provisions of the
Amendment to the Articles of Incorporation that materially adversely affects
the voting powers, rights or preferences of the holders of the Series D
Preferred Stock or the Voting Preferred Stock; provided, however, that the
amendment of the provisions of the Articles of Incorporation so as
to authorize or create, or to increase the authorized amount of, any Junior
Stock or any shares of any class ranking on a parity with the Series D
Preferred Stock or the Voting Preferred Stock shall not be deemed to
materially adversely affect the voting powers, rights or preferences of the
holders of Series D Preferred Stock, and provided further, that if any such
amendment, alteration or repeal would materially adversely affect any voting
powers, rights or preferences of the Series D Preferred Stock or another
series of Voting Preferred Stock that are not enjoyed by some or
all of the other series which otherwise would be entitled to vote in
accordance herewith, the affirmative vote of at least 66 2/3% of the votes
entitled to be cast by the holders of all series similarly affected,
similarly given, shall be required in lieu of the affirmative vote of at
least 66 2/3% of the votes entitled to be cast by the holders of the shares
of Series D Preferred Stock and the Voting Preferred Stock which otherwise
would be entitled to vote in accordance herewith; or
(b) The authorization or creation of, or the increase in the authorized
amount of, any shares of any class or any security convertible into shares of
any class ranking prior to the Series D Preferred Stock in the distribution of
assets on any liquidation, dissolution or winding up of the Corporation or in
the payment of dividends; provided, however, that no such vote of the holders
of Series D Preferred Stock shall be required if, at or prior to the time when
such amendment, alteration or repeal is to take effect, or when the issuance of
any such prior shares or convertible security is to be made, as the case maybe,
provision is made for the redemption of all shares of Series D Preferred Stock
at the time outstanding.
For purposes of the foregoing provisions of this Section 9, each share of
Series D Preferred Stock shall have one (1) vote per share, except that when
any other series of preferred stock shall have the right to vote with the
Series D Preferred Stock as a single class on any matter, then the Series D
Preferred Stock and such other series shall have with respect to such matters
one (1) vote per $25.00 of stated liquidation preference. Except as otherwise
required by applicable law or as set forth herein, the shares of Series D
Preferred Stock shall not have any relative, participating, optional or other
special voting rights and powers other than as set forth herein, and the
consent of the holders thereof shall not be required for the taking of any
corporate action.
Section 10. Record Holders. The Corporation and the Transfer Agent may
deem and treat the record holder of any shares of Series D Preferred Stock as
the true and lawful owner thereof for all purposes, and neither the
Corporation nor the Transfer Agent shall be affected by any notice to the
contrary.
IN WITNESS WHEREOF, the Corporation has caused these Articles of Amendment
to Articles of Incorporation to be made under the seal of the Corporation and
signed in its name and attested by its duly authorized officers this 5th day of
December, 1996.
MERRY LAND & INVESTMENT COMPANY, INC.
By: __________________________________
Michael N. Thompson
As its Vice President
Attest: ________________________________
Secretary/\Assistant Secretary
(Corporate Seal)
<PAGE>
CERTIFICATE
NUMBER
PD - ____
Series D Cumulative Redeemable Preferred Stock
SPECIMEN
__________
SHARES
No Par Value
CUSIP __________
MERRY LAND &
INVESTMENT
COMPANY, INC.
Incorporated under the laws of the State of Georgia
THIS CERTIFIES THAT _____________________ is the owner of ______________________
fully paid and non-assessable shares of the Series D Cumulative Redeemable
Preferred Stock of Merry Land & Investment Company, Inc. The shares represented
by this Certificate are transferable only on the stock transfer books of the
Corporation by the holder of record hereof, or by his duly authorized attorney
or legal representative, upon the surrender of this Certificate properly
endorsed. This Certificate is not valid until countersigned and registered
by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its corporate seal to be hereunto
affixed this _______ day of December, 1996.
________________________
Secretary/Assistant Secretary
________________________
President/Vice President
(SEAL)
COUNTERSIGNED AND REGISTERED:
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
(Charlotte, North Carolina)
Transfer Agent and Registrar
By: ____________________________________________
Authorized Signature
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO ISSUER 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 ITS
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.
<PAGE>
CERTIFICATE
NUMBER
PD - 1
Series D Cumulative Redeemable Preferred Stock
1,000,000
SHARES
No Par Value
CUSIP 590438 60 2
MERRY LAND &
INVESTMENT
COMPANY, INC.
Incorporated under the laws of the State of Georgia
THIS CERTIFIES THAT Cede & Co. is the owner of One Million
(1,000,000) fully paid and non-assessable shares of the Series D Cumulative
Redeemable Preferred Stock of Merry Land & Investment Company, Inc. The shares
represented by this Certificate are transferable only on the stock
transferbooks of the Corporation by the holder of record hereof, or by his duly
authorized attorney or legal representative, upon the surrender of this
Certificate properly endorsed. This Certificate is not valid until
countersigned and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the said Corporation has caused this Certificate to be
signed by its duly authorized officers and its corporate seal to be hereunto
affixed this _______ day of December, 1996.
________________________
Secretary/Assistant Secretary
________________________
President/Vice President
(SEAL)
COUNTERSIGNED AND REGISTERED:
FIRST UNION NATIONAL BANK OF
NORTH CAROLINA
(Charlotte, North Carolina)
Transfer Agent and Registrar
By: ____________________________________________
Authorized Signature
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK
CORPORATION ("DTC"), TO ISSUER 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 ITS
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.
<PAGE>
[Letterhead of Hull, Towill, Norman & Barrett, P.C.]
December 10, 1996
Merry Land & Investment Company, Inc.
P.O. Box 1417
Augusta, Georgia 30913
RE: Public Offering of Series D Cumulative Redeemable Preferred Stock
of Merry Land & Investment Company, Inc. (the "Offering")
Ladies and Gentlemen:
We have acted as counsel to Merry Land & Investment Company, Inc. (the
"Company") in connection with the referenced Offering with respect to the
proposed sale of up to 1,000,000 shares of the Company's 8.29% Series D
Cumulative Redeemable Preferred Stock, without par value, $50 Liquidation
Preference (the "Series D Preferred Stock").
We are familiar with the articles of incorporation, as amended, and
by-laws of the Company, the Prospectus Supplement dated December 5, 1996
filed with Registration Statement #33-65067 (the "Prospectus Supplement"),
and have examined such additional records and public documents as we have
deemed necessary for the opinions hereinafter expressed.
Based upon the foregoing, we are of the opinion that:
1. The Company is a corporation duly organized, existing and in good
standing under the laws of the State of Georgia.
2. All proceedings necessary to authorize the offering of the Series
D Preferred Stock have been taken.
3. The Series D Preferred Stock has been duly authorized and, when
sold and paid for in accordance with the Prospectus Supplement, will be
validly issued, fully paid and nonassessable.
We hereby consent to the filing of this opinion as an exhibit to the
Form 8-K filed with respect to the Offering and reference to this opinion
in the Prospectus Supplement.
Very truly yours,
HULL, TOWILL, NORMAN
& BARRETT, P.C.
<PAGE>
[Letterhead of Hull, Towill, Norman & Barrett, P.C.]
December 10, 1996
Merry Land & Investment Company, Inc.
P.O. Box 1417
Augusta, Georgia 30913
RE: Public Offering of Series D Cumulative Redeemable Preferred Stock
of Merry Land & Investment Company, Inc. (the "Offering")
Ladies and Gentlemen:
We have acted as counsel to Merry Land & Investment Company, Inc. (the
"Company") in connection with the referenced Offering with respect to the
proposed sale of up to 1,000,000 shares of the Company's 8.29% Series D
Cumulative Redeemable Preferred Stock, without par value, $50 Liquidation
Preference (the "Series D Preferred Stock").
We are familiar with the articles of incorporation, as amended, and
by-laws of the Company and have examined such additional records and public
documents as we have deemed necessary for the opinions hereinafter
expressed. We have been counsel to the Company for many years and are
generally familiar with its affairs. Where facts have not been
independently verified, we have relied upon statements of the Company's
officers, certificates of public officials, and records of the Company.
In rendering the opinions expressed herein, we have examined such
documents as we have deemed appropriate, including without limitation the
Prospectus Supplement, the Company's federal income tax returns for the
taxable periods to which our opinion relates, and Company-prepared
schedules which relate to the Company's compliance with various real estate
investment trust ("REIT") qualification tests. In our examination of
documents, we have assumed, with your consent, that all documents submitted
to us are authentic originals, or if submitted as photocopies, that they
faithfully reproduce the originals thereof, that all such documents have
been or will be duly executed to the extent required, that all
representations and statements set forth in such documents are true and
correct, and that all obligations imposed by any such documents on the
parties thereto have been or will be performed or satisfied in accordance
with their terms. We have also obtained such additional information and
representations as we have deemed relevant and necessary through
consultation with the officers of the Company and with the Company's
independent public accountants.
In rendering our opinion, we have assumed that during the relevant
taxable periods all persons who were required under the Securities and
Exchange Act of 1934 to file or amend Schedules 13D and 13G with respect to
the Company's outstanding shares appropriately made such filings and that
the Company was duly apprised of all such filings.
Based upon the foregoing, we are of the opinion that:
1. The Company met the requirements for qualification and taxation
as a REIT for the taxable years 1990 through 1995.
2. The Company's diversity of stock ownership and proposed method of
operation should allow it to qualify as a REIT for 1996.
3. The discussion contained in that portion of the Company's
Prospectus Supplement dated December 5, 1996 to that Prospectus filed with
Registration Statement #33-65067 (the "Prospectus Supplement") under the
caption "Taxation" accurately reflects existing law and fairly addresses
the material federal income tax issues that would affect an investment in
the Shares. Such discussion is hereby incorporated herein by this
reference.
The opinions expressed herein are based upon the Code, the U.S.
Treasury Regulations promulgated thereunder, current administrative
positions of the U.S. Internal Revenue Service, and existing judicial
decisions, any of which could be changed at any time, possibly on a
retroactive basis. Any such changes could adversely affect the opinions
rendered herein and the tax consequences to the Company and the investors
in the Shares. In addition, as noted above, our opinions are based solely
on the documents that we have examined, the additional information that we
have obtained, and the representations that have been made to us, and
cannot be relied upon if any of the facts contained in such documents or in
such additional information is, or later becomes, inaccurate or if any of
the representations made to us is, or later becomes, inaccurate.
Finally, our opinion is limited to the tax matters specifically
covered thereby, and we have not been asked to address, nor have we
addressed, any other tax consequences of an investment in the Shares.
We hereby consent to the filing of this opinion as an exhibit to the
Form 8-K filed with respect to the Offering and reference to this opinion
in the Prospectus Supplement.
Very truly yours,
HULL, TOWILL, NORMAN
& BARRETT, P.C.
