<PAGE>
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): October 30, 1997
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: October 31, 1997
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ITEM 5. OTHER EVENTS. Merry Land & Investment Company, Inc. (the
"Company") has completed the offering of $50,000,000 principal at maturity
of its 6.69% Notes due 2006 (the "Notes").The offering of the Notes was
made pursuant to a Prospectus Supplement dated October 27, 1997 relating to
the Prospectus dated January 22, 1996 filed with the Company's shelf
registration statement #33-65067 on Form S-3.
The Notes bear interest at 6.69% from October 30, 1997, with interest
payable each May 1 and November 1 beginning May 1, 1998. The entire
principal amount of the Notes is due October 30, 2006. The Notes may be
redeemed at any time at the option of the Company, in whole or in part, at
a redemption price equal to the sum of (i) the principal amount of the
Notes being redeemed plus accrued interest thereon to the redemption date
and (ii) the Make-Whole Amount, if any.
The Notes were sold under an Indenture and Supplemental Indenture with
First Union National Bank of Georgia as Trustee. The underwriting discount
was 0.60% for the Notes and the price to the public was 99.40% of the
principal amount of the Notes.
The net proceeds to the Company from the sale of the Notes was
$49,700,000. The Company intends to use the net proceeds to reduce amounts
borrowed on its existing $200 million unsecured line of credit.
Delivery of the Notes was made on October 30, 1997 through the
facilities of the Depository Trust Company, against payment therefor in
immediately available funds.
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 4A: Form of Merry Land & Investment Company, Inc.
$50,000,000 principal at maturity of 6.69% Notes due
2006.
C. EXHIBIT 4B: Indenture (incorporated herein by reference to Exhibit
4B of the Company's current report on Form 8-K filed
June 23, 1995).
D. EXHIBIT 4C: First Supplemental Indenture (incorporated herein
by reference to Exhibit 4C of the Company's
current report on Form 8-K filed June 23, 1995).
E. EXHIBIT 5: Opinion as to the legality of the Notes.
F. EXHIBIT 8: Tax Opinion.
G. EXHIBIT 12: Statement regarding computation of ratios (incorporated
herein by reference to Exhibit 12 of the Company's 1996
10-K/A filed June 3,1997).
H. EXHIBIT 23: Consent of Hull, Towill, Norman & Barrett, P.C.
(contained in Exhibits 5 and 8).
I. EXHIBIT 27: Financial Data Schedule (incorporated herein by
reference to Exhibit 27 of the Company's 1996 10-K
filed June 3, 1997).
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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/
------------------------------
Dorrie E. Green
As Its Vice President
MERRY LAND & INVESTMENT COMPANY, INC.
Debt Securities
Underwriting Agreement
October 27, 1997
FIRST UNION CAPITAL MARKETS CORP.
301 SOUTH COLLEGE STREET
CHARLOTTE, NORTH CAROLINA 38388
LADIES AND GENTLEMEN:
Merry Land & Investment Company, Inc., a Georgia corporation (the
"Company"), proposes to issue and sell to YOU (the "Underwriter"), the
principal amount of its debt securities identified in Schedule I hereto
(the "Securities"), to be issued under the indenture specified in Schedule
I hereto (the "Indenture") between the Company and the Trustee identified
in such Schedule (the "Trustee").
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of
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 include any documents filed under the Exchange Act
after the date of this Agreement, or the date of the Basic Prospectus, any
preliminary prospectus or the Prospectus, as the case may be, which are
deemed to be incorporated by reference therein.
The Company hereby agrees with the Underwriter as follows:
1. The Company agrees to issue and sell the Securities to the
Underwriter as hereinafter provided, and the Underwriter, on the basis of
the representations and warranties herein contained, but subject to the
conditions hereinafter stated, agrees to purchase from the Company the
Securities at the purchase price set forth in Schedule I hereto plus
accrued interest, if any, from the date specified in Schedule I hereto to
the date of payment and delivery.
2. The Company understands that the Underwriter intends (i) to make
a public offering of their respective portions of the Securities and (ii)
initially to offer the Securities upon the terms set forth in the
Prospectus.
3. Payment for the Securities shall be made to the Company or to its
order in immediately available funds on the date and at the time and place
set forth in Schedule I hereto (or at such other time and place on the same
or such other date, not later than the third Business Day thereafter, as
you and the Company may agree in writing). Such payment will be made upon
delivery to, or to you for the respective accounts of, the Underwriter of
the Securities registered in such names and in such denominations as you
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 the Trust Indenture Act of 1939, as amended, and
the rules and regulations of the Commission thereunder (collectively,
the "Trust Indenture Act"), and do not and will not, as of the
applicable effective date as to the Registration Statement and 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 (i) that part of the Registration
Statement which constitutes the Statement of Eligibility and
Qualification (Form T-1) under the Trust Indenture Act of the Trustee,
and (ii) statements or omissions in the Registration Statement or the
Prospectus made in reliance upon and in conformity with information
relating to the Underwriter furnished to the Company in writing by the
Underwriter expressly for use therein;
(b) the documents incorporated by reference in the Prospectus,
when they were filed with the Commission, conformed in all material
respects to the requirements of the Exchange Act, and none of such
documents contained an untrue statement of a material fact or omitted
to state a material fact necessary to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; and any further documents so filed and incorporated by
reference in the Prospectus, when such documents are filed with the
Commission will conform in all material respects to the requirements
of the Exchange Act, as applicable, and will not contain an untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading;
(c) the consolidated 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 and its Subsidiaries as of the dates indicated and the
consolidated 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, 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 its Subsidiaries taken as a
whole; except for investments in securities as described in the
Registration Statement or Prospectus, the Company and 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 and the Indenture have been duly authorized,
executed and delivered by the Company and constitute the valid and
legally binding obligations of the Company enforceable in accordance
with their terms, except as rights to indemnity and contribution
hereunder may be limited by applicable law;
(g) the Securities have been duly authorized, and, when issued,
authenticated and delivered pursuant to this Agreement and the
Indenture will have been duly and validly executed, authenticated,
issued and delivered and will constitute valid and binding obligations
of the Company entitled to the benefits provided by the Indenture; the
Indenture has been duly authorized and has been duly qualified under
the Trust Indenture Act and, when executed and delivered by the
Company and the Trustee, the Indenture will constitute a valid and
binding instrument; and the Securities and the Indenture will conform
to the statements relating thereto contained in the Prospectus;
(h) neither the Company nor 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 or By-
Laws 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
and the performance by the Company of all of the provisions of its
obligations under the Securities, the Indenture and this Agreement and
the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage,
deed of trust, loan agreement 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 or the Indenture, except
such consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act, the
Trust Indenture Act and as may be required under state securities or
Blue Sky Laws in connection with the purchase and distribution of the
Securities by the Underwriters;
(i) 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;
(j) 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;
(k) 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;
(l) 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;
(m) Arthur Andersen LLP, who have 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;
(n) 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;
(o) with respect to all tax periods regarding which the Internal
Revenue Service is or will be entitled to assert any claim, the
Company has met the requirements for qualification as a real estate
investment trust under Sections 856 through 860 of the Internal
Revenue Code, as amended, and the Company's present and contemplated
operations, assets and income continue to meet such requirements; and
(p) the conditions for the use of a registration statement on
Form S-3 set forth in the General Instructions on Form S-3 have been
satisfied and the Company is entitled to use such form for the
transactions contemplated herein.
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) 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;
(f) 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;
(g) 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;
(h) 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;
(i) during the period beginning on the date hereof and continuing
to and including the Business Day following the Closing Date, not to
offer, sell, contract to sell or otherwise dispose of any debt
securities of or guaranteed by the Company which are substantially
similar to the Securities without your prior written consent; and
(j) to pay all costs and expenses incident to the performance of
its obligations hereunder, including without limiting the generality
of the foregoing, all costs and expenses (i) incident to the
preparation, issuance, execution, authentication and delivery of the
Securities, including any expenses of the Trustee, (ii) incident to
the preparation, printing and filing under the Securities Act of the
Registration Statement, the Prospectus and any preliminary prospectus
(including in each case all exhibits, amendments and supplements
thereto), (iii) incurred in connection with the registration or
qualification and determination of eligibility for investment of the
Securities under the laws of such jurisdictions as the Underwriter may
designate (including fees of counsel for the Underwriter and 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 Indenture, the Preliminary and
Supplemental Blue Sky Memoranda and any Legal Investment Survey and
the furnishing to Underwriter and dealers of copies of the
Registration Statement and the Prospectus, including mailing and
shipping, as herein provided and (vii) payable to rating agencies in
connection with the rating of the Securities.
6. The 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 its subsidiaries, taken as a whole,
otherwise than as set forth or contemplated in the Prospectus, the
effect of which in the judgment of the Underwriter makes it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities on the terms and in the manner
contemplated in the Prospectus;
(e) the Underwriter shall have received on and as of the Closing
Date a certificate of 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 its
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 authorized, and when
executed and authenticated in accordance with the terms of the
Indenture and delivered to and paid for by the Underwriter in
accordance with the terms of this Agreement, will constitute
valid and binding obligations of the Company entitled to the
benefits provided by the Indenture, enforceable in accordance
with their terms, except that the enforceability thereof may be
limited by or subject to (a) bankruptcy, reorganization,
insolvency, fraudulent conveyance, moratorium or other similar
laws now or hereafter existing which affect the rights and
remedies of creditors generally and (b) equitable principles of
general applicability;
(viii) the Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding
instrument of the Company enforceable in accordance with its
terms, except that the enforceability thereof may be limited by
or subject to (a) bankruptcy, reorganization, insolvency,
fraudulent conveyance, moratorium or other similar laws now or
hereafter existing which affect the rights and remedies of
creditors generally and (b) equitable principles of general
applicability; and the Indenture has been duly qualified under
the Trust Indenture Act;
(ix) 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 performance by the Company of its obligations under the
Securities, the Indenture and this Agreement and the consummation
of the transactions herein and therein contemplated will not
conflict with or result in a breach of any of the terms or
provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other material
agreement or instrument known to such counsel to which the
Company or any 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;
(x) the Company has authorized and outstanding stock as set
forth under the caption "Capitalization" in the Prospectus;
(xi) no consent, approval, authorization, order,
registration or qualification of or with any court or
governmental agency or body is required for the issue and sale of
the Securities or the consummation of the other transactions
contemplated by this Agreement or the Indenture, except such
consents, approvals, authorizations, registrations or
qualifications as have been obtained under the Securities Act and
the Trust Indenture Act and as may be required under state
securities or Blue Sky laws in connection with the purchase and
distribution of the Securities by the Underwriter;
(xii) the statements in the Prospectus under the captions
"Description of Notes," "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, 1996
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;
(xiii) 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 the Trust Indenture 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
(xiv) the Company is not, and will not become as a result of
the consummation of the transactions contemplated by this
Agreement, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, and has not been an
"investment company" at any time since 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 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, 1995 and 1996;
(ii) the Company's diversity of stock ownership and proposed
method of operation should allow it to qualify as a REIT for
1997; and
(iii) the discussion contained under the caption "Certain
Federal Income Tax Considerations to the Company of its REIT
Election" 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 underwriters with respect
to the financial statements and certain financial information
contained or incorporated by reference 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 Indenture and the Securities, the
Registration Statement, the Prospectus and other related matters as
the Underwriter may reasonably request, and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters; and
(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 any 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 such 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 on
Schedule I hereto and any such separate firm for the Company, its
directors, its officers who sign the Registration Statement and such
control 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); 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 Designated 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 any defaulting Underwriter from liability in
respect of any default of such 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 who has so
terminated this Agreement, for all out-of-pocket expenses (including the
fees and expenses of their counsel) reasonably incurred by the Underwriters
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. Any action by the Underwriter hereunder may be taken by you, and
any such action taken by you shall be binding upon the Underwriter. 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
the address set forth in Schedule II hereto. 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.
Very truly yours,
MERRY LAND & INVESTMENT COMPANY,
INC.
/s/
By:_______________________________________
Name: W. Tennent Houston
Title: President
Accepted: October 27, 1997
FIRST UNION CAPITAL MARKETS CORP.
/s/
By:______________________________
Name:
Title:
<PAGE>
SCHEDULE I
Underwriting Agreement dated: October 27, 1997
Registration Statement No.: 33-65067
Title of Securities: 6.69% OF NOTES DUE 2006
Aggregate principal amount: $50,000,000
Price to Public: $50,000,000
Underwriting Discount: .600%
Indenture: Indenture dated as of February 1, 1995, and
the Supplemental Indenture dated as of June 1,
1995, both between Merry Land & Investment
Company, Inc. and First Union National Bank of
Georgia
MATURITY: OCTOBER 30, 2006
Interest Rate: 6.69%
Interest Payment Dates: MAY 1 AND NOVEMBER 1
Optional Redemption Provisions: REDEEMABLE AT ANY TIME AT THE OPTION OF THE
COMPANY, IN WHOLE OR IN PART, AT A REDEMPTION
PRICE EQUAL TO THE SUM OF (I) PRINCIPAL AMOUNT OF
THE NOTES PLUS ACCRUED INTEREST TO THE REDEMPTION
DATE, (II) PLUS THE MAKE WHOLE AMOUNT, IF ANY.
Sinking Fund Provisions: None
Other Provisions: As specified in the Prospectus Supplement
dated OCTOBER 27, 1997 relating to the Securities.
Closing Date and Time of Delivery: October 30, 1997, 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 First Union Capital Markets Corp.
301 SOUTH COLLEGE STREET
CHARLOTTE, NORTH CAROLINA
ATTENTION: JIM WILLIAMS
<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.
MLA, Inc.
McCaslin Riverhill, Ltd.
The Wimberly Apartment Homes, Ltd.
McCaslin Hidden Lakes, Ltd.
THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A
NOMINEE THEREOF. THIS SECURITY MAY NOT BE TRANSFERRED TO, OR REGISTERED OR
EXCHANGED FOR SECURITIES REGISTERED IN THE NAME OF, ANY PERSON OTHER THAN
THE DEPOSITARY OR A NOMINEE THEREOF AND NO SUCH TRANSFER MAY BE REGISTERED,
EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE. EVERY
SECURITY AUTHENTICATED AND DELIVERED UPON REGISTRATION OF 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.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY (AS
DEFINED BELOW) OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR
PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO.
OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC
(AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED
BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
MERRY LAND & INVESTMENT COMPANY, INC.
6.69% NOTE DUE 2006
REGISTERED PRINCIPAL AMOUNT
No.: 1 $50,000,000
CUSIP No.: 590438AHO
MERRY LAND & INVESTMENT COMPANY, INC., a corporation organized and
existing under the laws of the State of Georgia (hereinafter called the
"Company," which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to CEDE
& Co., or registered assigns, upon presentation, the principal sum of Fifty
Million Dollars ($50,000,000) on October 30, 2006 at the office or agency of
the Company referred to below, and to pay interest thereon from October 30,
1997, or from the most recent Interest Payment Date to which interest has
been paid or duly provided for, semi-annually in arrears on May 1 and
November 1 in each year, commencing May 1, 1998, at the rate of 6.69% per
annum, until the entire principal hereof is paid or made available for
payment. The interest so payable, and punctually paid or duly provided for
on any Interest Payment Date will, as provided for in the Indenture, be paid
to the person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on the Regular Record Date
for such interest which shall be April 15 or October 15 (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date.
Any such interest not so punctually paid or duly provided for shall forthwith
cease to be payable to the Holder on such Regular Record Date, and may either
be paid to the Person in whose name this Security (or one or more Predecessor
Securities) is registered at the close of business on a Special Record Date
for the payment of such Defaulted Interest to be fixed by the Trustee, notice
whereof shall be given to Holders of Securities of this series not more than
15 days and not less than 10 days prior to such Special Record Date, or may
be paid at any time in any other lawful manner not inconsistent with the
requirements of any securities exchange on which the Securities of this
Series may be listed, and upon such notice as may be required by such
exchange, all as more fully provided in the Indenture.
Payment of the principal of, Make-Whole Amount, if any, and interest on
this Security will be made at the office or agency of the Company maintained
for that purpose in the City of New York, Borough of Manhattan, or elsewhere
as provided in the Indenture, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public
and private debts; provided; however, that at the option of the Company
payment of interest may be made by (i) check mailed to the address of the
Person entitled thereto as such address shall appear in the Security Register
or (ii) by wire transfer of funds to an account of the Person entitled
thereto maintained within the United States.
This Security is one of a duly authorized issue of securities of the
Company (herein called the "Securities"), issued and to be issued in one or
more series under an Indenture, dated as of February 1, 1995, as supplemented
by the First Supplemental Indenture, dated as of June 1, 1995 (as so
supplemented, herein called the "Indenture"), between the Company and First
Union National Bank of Georgia, as Trustee (herein called the "Trustee,"
which term includes any successor trustee under the Indenture with respect to
the series of which this Security is a part), to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of
the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and
of the terms upon which the Securities are, and are to be, authenticated and
delivered. This Security is one of the series designated on the first page
hereof, limited in aggregate principal amount to $50,000,000.
Securities of this series may be redeemed at any time at the option of
the Company, in whole or in part, upon notice of not more than 60 nor less
than 30 days prior to the Redemption Date, at a redemption price equal to the
sum of (i) the principal amount of the Securities being redeemed plus accrued
interest thereon to the Redemption Date and (ii) the Make-Whole Amount, if
any, with respect to such Securities.
"Make-Whole Amount" means, in connection with any optional redemption or
accelerated payment of any Security, the excess, if any, of (i) the aggregate
present value as of the date of such redemption or accelerated payment of
each dollar of principal being redeemed or paid and the amount of interest
(exclusive of interest accrued to the date of redemption or accelerated
payment) that would have been payable in respect of such dollar if such
redemption or accelerated payment had not been made, determined by
discounting, on a semi-annual basis, such principal and interest at the
Reinvestment Rate (determined on the third Business Day preceding the date
such notice of redemption is given or declaration of acceleration is made)
from the respective dates on which such principal and interest would have
been payable if such redemption or accelerated payment had not been made,
over (ii) the aggregate principal amount of the Securities being redeemed or
paid.
"Reinvestment Rate" means .25% (twenty-five one hundredths of one
percent) plus the arithmetic mean of the yields under the respective headings
"This Week" and "Last Week" published in the Statistical Release under the
caption "Treasury Constant Maturities" for the maturity (rounded to the
nearest month) corresponding to the remaining life to maturity, as of the
payment date of the principal being redeemed or paid. If no maturity exactly
corresponds to such maturity, yields for the two published maturities most
closely corresponding to such maturity shall be calculated pursuant to the
immediately preceding sentence and the Reinvestment Rate shall be
interpolated or extrapolated from such yields on a straight-line basis,
rounding in each of such relevant periods to the nearest month. For purposes
of calculating the Reinvestment Rate, the most recent Statistical Release
published prior to the date of determination of the Make-Whole Amount shall
be used.
"Statistical Release" means the statistical release designated
"H.15(519)" or any successor publication which is published weekly by the
Federal Reserve System and which establishes yields on actively traded United
States government securities adjusted to constant maturities or, if such
statistical release is not published at the time of any determination under
the Indenture, then such other reasonably comparable index which shall be
designated by the Company.
The Indenture contains provisions for defeasance at any time of (a) the
entire indebtedness of the Company on this Security and (b) certain
restrictive covenants and the related defaults and Events of Default
applicable to the Company, in each case, upon compliance by the Company with
certain conditions set forth in the Indenture, which provisions apply to this
Security.
If any Event of Default with respect to Securities of this series shall
occur and be continuing, the principal of, and the Make-Whole Amount, if any,
on the Securities of this series may be declared due and payable in the
manner and with the effect provided in the Indenture.
As provided in and subject to the provisions of the Indenture, the
Holder of this Security shall not have the right to institute any proceeding
with respect to the Indenture or for the appointment of a receiver or trustee
or for any other remedy thereunder, unless such Holder shall have previously
given the Trustee written notice of a continuing Event of Default with
respect to the Securities of this series, the Holders of not less than 25% in
principal amount of the Securities of this series at the time Outstanding
shall have made written request to the Trustee to institute proceedings in
respect of such Event of Default as Trustee, offered the Trustee reasonable
indemnity, and the Trustee shall not have received from the Holders of a
majority in principal amount of Securities of this series at the time
Outstanding a direction inconsistent with such request, and the Trustee shall
have failed to institute any such proceeding, for 60 days after receipt of
such notice, request and offer of indemnity. The foregoing shall not apply
to any suit instituted by the Holder of this Security for the enforcement of
any payment of principal hereof (and premium or Make-Whole Amount, if any)or
any interest on and any Additional Amounts in respect thereof on or after the
respective due dates expressed herein.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Securities of each series to be
affected under the Indenture at any time by the Company and the Trustee with
the consent of the Holders of not less than a majority in principal amount of
the Securities of each series at the time Outstanding affected thereby. The
Indenture also contains provisions permitting the Holders of specified
percentages in principal amount of the Securities of each series at the time
Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and
certain past defaults under the Indenture and their consequences. Any such
consent or waiver by the Holder of this Security shall be conclusive and
binding upon such Holder and upon all future Holders of this Security and of
any Security issued upon the registration of transfer hereof or in exchange
herefor or in lieu hereof, whether or not notation of such consent or waiver
is made upon this Security.
No reference herein to the Indenture and no provision of this Security
or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of, Make-Whole
Amount, if any, and interest on this Security at the times, place and rate,
and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Security is registrable in the Security
Register, upon surrender of this Security for registration of transfer at the
office or agency of the Company in any Place of Payment where the principal
of, Make-Whole Amount, if any, and interest on this Security are payable,
duly endorsed by, or accompanied by a written instrument of transfer in form
satisfactory to the Company and the Security Registrar duly executed by, the
Holder hereof or his attorney duly authorized in writing, and thereupon one
or more new Securities of this series, of authorized denominations and for
the same aggregate principal amount, will be issued to the designated
transferee or transferees.
The Securities of this series are issuable only in registered form
without coupons in denominations of $1,000 and any integral multiple thereof.
As provided in the Indenture and subject to certain limitations therein set
forth, Securities of this series are exchangeable for a like aggregate
principal amount of Securities of this series of a different authorized
denomination, as requested by the Holder surrendering the same.
No service charge shall be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.
Prior to due presentment of this Security for registration of transfer,
the Company, the Trustee and any agent of the Company or the Trustee may
treat the Person in whose name this Security is registered as the owner
hereof for all purposes, whether or not this Security be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to
the contrary.
No recourse under or upon any obligation, covenant or agreement
contained in the Indenture or in this Security, or because of any
indebtedness evidenced thereby, shall be had against any promoter, as such
or, against any past, present or future stockholder, officer or director, as
such, of the Company or of any successor, either directly or through the
Company or any successor, under any rule of law, statute or constitutional
provision or by the enforcement of any assessment or by any legal or
equitable proceeding or otherwise, all such liability being expressly waived
and released by the acceptance of this Security by the Holder thereof and as
part of the consideration for the issue of the Securities of this series.
All terms used in this security which are defined in the Indenture shall
have the meanings assigned to them in the Indenture.
THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF GEORGIA.
Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures, the Company has caused "CUSIP" numbers to
be printed on the Securities of this series as convenience to the Holders of
such Securities. No representation is made as to the correctness or accuracy
of such CUSIP numbers as printed on the Securities, and reliance may be
placed only on the other identification numbers printed hereon.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee by manual signature, this Security shall not be
entitled to any benefit under the Indenture or be valid or obligatory for any
purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.
Date: October 30, 1997
MERRY LAND & INVESTMENT COMPANY,
INC.
By:
- -----------------------------------
Name: W. Tennent Houston
Title: President
Attest:
By:
- ------------------------------------
Name: Mark S. Burgreen
Title: Assistant Secretary
[SEAL]
Dated: October 30, 1997
TRUSTEE'S CERTIFICATE OF AUTHENTICATION:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
FIRST UNION NATIONAL BANK, as
Trustee
By:
- ------------------------------
Authorized Officer
<PAGE>
[Letterhead of Hull, Towill, Norman & Barrett, P.C.]
October 30, 1997
MERRY LAND & INVESTMENT COMPANY, INC.
624 Ellis Street
Augusta, GA 30901
RE: MERRY LAND & INVESTMENT COMPANY, INC.: Public Offering of
$50,000,000 principal amount at maturity of 6.69% Notes due 2006
(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 $50,000,000 principal amount at maturity of 6.69%
Notes due 2006 (the "Notes").
We are familiar with the articles of incorporation, as amended, and
by-laws of the Company, the Prospectus Supplement dated October 27, 1997 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 opinion 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 Notes
have been taken.
3. The Notes has been duly authorized, and when executed and
authenticated in accordance with the terms of the Indenture and Supplemental
Indenture and delivered to and paid for by the Underwriter in accordance with
the terms of the Underwriting Agreement between the Company and First Union
Capital Markets Corp. dated October 27, 1997, will constitute valid and
binding obligations of the Company entitled to the benefits provided by the
Indenture and Supplemental Indenture, enforceable in accordance with their
terms, except that the enforceability thereof may be limited by or subject to
(a) bankruptcy, reorganization, insolvency, fraudulent conveyance, moratorium
or other similar laws now or hereafter existing which affect the rights and
remedies of creditors generally and (b) equitable principles of general
applicability;
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.
/S/
HULL, TOWILL, NORMAN
& BARRETT, P.C.
<PAGE>
[Letterhead of Hull, Towill, Norman & Barrett, P.C.]
October 30, 1997
MERRY LAND & INVESTMENT COMPANY, INC.
624 Ellis Street
Augusta, GA 30901
RE: MERRY LAND & INVESTMENT COMPANY, INC.:
Public Offering of $50,000,000 principal
amount at maturity of 6.69% Notes due
2006 (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 $50,000,000 principal
amount at maturity of 6.69% Notes due 2006 (the "Debt Securities").
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
opinion 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 Company's Registration Statement on Form S-3 (File #33-65067)
and the amendments thereto, the Prospectus Supplement dated October 27, 1997,
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 - 1996.
2. The Company's diversity of stock ownership
and proposed method of operation should allow it to qualify as a REIT for
1997.
3. The discussion contained in that portion
of the Company's Prospectus Supplement dated October 27, 1997 to that
Prospectus filed with Registration Statement #33-65067 (the "Prospectus
Supplement") under the caption "Certain Federal Income Tax Considerations to
the Company of its REIT Election" accurately reflects existing law and fairly
addresses the material federal income tax issues described therein. 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 Debt Securities. 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. No facts have
come to our attention which lead us to believe that we are not justified in
relying upon such representations.
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
Debt Securities.
We hereby consent to the filing of this opinion
as an exhibit to the Form 8-K filed with respect to the Offering.
/S/
HULL, TOWILL, NORMAN
& BARRETT, P.C.
