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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
NOVEMBER 18, 1997 (NOVEMBER 12, 1997)
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JDN REALTY CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
MARYLAND 1-12844 58-1468053
(State or Other (Commission File (I.R.S. Employer
Jurisdiction of Number) Identification
Incorporation) Number)
3340 PEACHTREE ROAD, N.E.
SUITE 1530
ATLANTA, GEORGIA 30326
(Address of Principal Executive Offices) (Zip Code)
(404) 262-3252
(Registrant's Telephone Number, including Area Code)
NOT APPLICABLE
(Former Name)
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ITEM 5. OTHER EVENTS.
On November 12, 1997, the Company entered into a terms
agreement with Merrill Lynch, Pierce, Fenner & Smith Incorporated ("Merrill
Lynch"), BT Alex. Brown Incorporated, A.G. Edwards & Sons, Inc., Smith Barney
Inc. and The Robinson-Humphrey Company, LLC (collectively, the "Underwriters")
relating to the sale by the Company to the Underwriters of 3,000,000 shares of
the Company's common stock, $.01 par value per share (the "Common Stock"), at a
price of $31.50 per share, which closed on November 18, 1997. The related
Underwriting Agreement by and between the Company and Merrill Lynch, was filed
as an exhibit to the Company's Current Report on Form 8-K, filed on August 1,
1997. The Company has granted the Underwriters a 30-day option to purchase up to
450,000 additional shares of Common Stock solely to cover over-allotments, if
any. A registration statement relating to these securities has been filed with
the Securities and Exchange Commission and was declared effective on October 30,
1997.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(C) EXHIBITS.
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
1 Terms Agreement by and between the Company and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, BT Alex. Brown Incorporated, A.G. Edwards & Sons, Inc., Smith Barney
Inc. and The Robinson-Humphrey Company, LLC
5 Opinion of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
8 Tax Opinion of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
23 Consent of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
(included in Exhibits 5 and 8)
</TABLE>
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
JDN REALTY CORPORATION
By: /s/ William J. Kerley
-----------------------------
William J. Kerley
Chief Financial Officer
Date: November 18, 1997
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INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
1 Terms Agreement by and between the Company and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, BT Alex. Brown Incorporated, A.G. Edwards & Sons, Inc., Smith Barney
Inc. and The Robinson-Humphrey Company, LLC
5 Opinion of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
8 Tax Opinion of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
23 Consent of Waller Lansden Dortch & Davis, A Professional Limited Liability Company
(included in Exhibits 5 and 8)
</TABLE>
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EXHIBIT 1
JDN REALTY CORPORATION
(a Maryland corporation)
Shares of Common Stock (Par Value $.01 Per Share)
TERMS AGREEMENT
Dated: November 12, 1997
To: JDN Realty Corporation
3340 Peachtree Road, N.E.
Suite 1530
Atlanta, GA 30326
Ladies and Gentlemen:
We, the below listed underwriters (the "Representatives"),
understand that JDN Realty Corporation (the "Company") proposes to issue and
sell shares of Common Stock (the "Common Shares" or "Underwritten Securities").
Subject to the terms and conditions set forth or incorporated by reference
herein, each of the underwriters named below (the "Underwriters") offer to
purchase, severally and not jointly, the respective numbers of Initial
Underwritten Securities (as defined in the Underwriting Agreement referred to
below) set forth below opposite their respective names, and a proportionate
share of Option Underwritten Securities (as defined in the Underwriting
Agreement referred to below) to the extent any are purchased, at the purchase
price per Common Share set forth below.
<TABLE>
<CAPTION>
Number of Shares of Initial
Underwriter Underwritten Securities
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<S> <C>
Merrill Lynch, Pierce, Fenner & Smith Incorporated 600,000
BT Alex. Brown Incorporated 600,000
A.G. Edwards & Sons, Inc. 600,000
Smith Barney Inc. 600,000
The Robinson-Humphrey Company, LLC 600,000
---------
Total 3,000,000
</TABLE>
The Underwritten Securities shall have the following terms:
Shares of Common Stock
TITLE OF SECURITIES: Common Stock
NUMBER OF SHARES: 3,000,000
<PAGE> 2
PAR VALUE: $.01 per Common Share.
PUBLIC OFFERING PRICE PER COMMON SHARE: $31.50
PURCHASE PRICE PER COMMON SHARE: $29.85
NUMBER OF OPTION UNDERWRITTEN SECURITIES, IF ANY, THAT MAY BE PURCHASED BY THE
UNDERWRITERS: 450,000.
DELAYED DELIVERY CONTRACTS: not authorized
ADDITIONAL CO-MANAGERS, IF ANY: BT Alex. Brown Incorporated, A.G. Edwards &
Sons, Inc., Smith Barney Inc. and The Robinson-Humphrey Company, LLC.
OTHER TERMS (LOCK-UP): In accordance with Section 3(k) of the Underwriting
Agreement (incorporated herein by reference), without the written consent of
Merrill Lynch, Pierce, Fenner & Smith Incorporated (which consent shall not be
unreasonably withheld) the Company shall be restricted from selling Common
Stock, as set forth in said Section 3(k) for a period of 30 days from the date
hereof, and the executive officers and directors of the Company will likewise be
so restricted.
CLOSING DATE AND LOCATION: November 18, 1997, Hogan & Hartson L.L.P.,
Columbia Square, 555 Thirteenth Street, N.W., Washington, DC 20004.
All the provisions contained in the document attached as Annex A hereto
entitled "JDN Realty Corporation (a Maryland corporation) -- Common Stock,
Common Stock Warrants, Preferred and Debt Securities -- Underwriting Agreement,"
dated July 30, 1997 (the "Underwriting Agreement"), are hereby incorporated by
reference in their entirety herein and shall be deemed to be a part of this
Terms Agreement to the same extent as if such provisions had been set forth in
full herein. In addition, the Underwriting Agreement is hereby amended to delete
the reference to "(No. 333-22399)" contained in the first sentence of the eighth
paragraph thereof in its entirety and to insert "(No. 333-38611)" in lieu
thereof. Terms defined in such document are used herein as therein defined.
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Please accept this offer no later than 5:00 p.m. (New York City time)
on November 12, 1997 by signing a copy of this Terms Agreement in the space set
forth below and returning the signed copy to us.
Very truly yours,
MERRILL LYNCH & CO.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
BT ALEX. BROWN INCORPORATED
A.G. EDWARDS & SONS, INC.
SMITH BARNEY INC.
THE ROBINSON-HUMPHREY COMPANY, LLC
By: MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ TJARDA CLAGETT
------------------------------------
Name: Tjarda Clagett
Title: Director
Accepted:
By: JDN Realty Corporation
By: /s/ J. DONALD NICHOLS
-------------------------
Name: J. Donald Nichols
Title: Chairman and CEO
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EXHIBIT 5
WALLER LANSDEN DORTCH & DAVIS
A PROFESSIONAL LIMITED LIABILITY COMPANY
NASHVILLE CITY CENTER
511 UNION STREET, SUITE 2100
POST OFFICE BOX 198966
NASHVILLE, TENNESSEE 37219-8966
(615) 244-6380
FACSIMILES 809 SOUTH MAIN STREET
(615) 244-6804 P. O. BOX 1035
(615) 244-5686 COLUMBIA, TN 38402-1035
(615) 388-6031
November 18, 1997
JDN Realty Corporation
3340 Peachtree Road, N.E.
Suite 1530
Atlanta, Georgia 30326
Re: JDN REALTY CORPORATION - PROSPECTUS SUPPLEMENT
(TO THE PROSPECTUS DATED OCTOBER 30, 1997)
Ladies and Gentlemen:
We are acting as your counsel in connection with the issuance
and sale of 3,000,000 shares of common stock, $.01 par value, together with up
to an additional 450,000 shares of Common Stock, $.01 par value, subject to an
underwriters' over-allotment option (collectively, the "Shares"), by JDN Realty
Corporation, a Maryland corporation (the "Company"), to Merrill Lynch, Pierce,
Fenner & Smith Incorporated, BT Alex. Brown Incorporated, A.G. Edwards & Sons,
Inc., Smith Barney Inc. and The Robinson-Humphrey Company, LLC (the
"Underwriters"), pursuant to a Registration Statement on Form S-3 (Registration
No. 333-38611) (the "Registration Statement"), including the Prospectus dated
October 30, 1997 contained therein (the "Prospectus") as supplemented by the
Prospectus Supplement dated November 12, 1997 (the "Prospectus Supplement"), an
Underwriting Agreement between the Company and Merrill Lynch, Pierce, Fenner &
Smith Incorporated dated July 30, 1997 (the "Underwriting Agreement") and a
Terms Agreement between the Company and the Underwriters dated November 12, 1997
(the "Terms Agreement").
As such counsel and in connection with the foregoing, we have
examined and relied upon such records, documents and other instruments as in our
judgment are necessary or appropriate in order to express the opinion
hereinafter set forth, and have assumed the genuineness of all signatures, the
authenticity of all documents submitted to us as originals, and the conformity
to original documents of all documents submitted to us as certified or
photostatic copies.
Based upon and subject to the foregoing and such other matters
as we have deemed relevant, we are of the opinion that the Shares have been duly
authorized by all necessary corporate action and, when delivered and issued upon
payment therefor in the manner and on the
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terms described in the Registration Statement, the Prospectus, the Prospectus
Supplement, the Underwriting Agreement and the Terms Agreement, will be validly
issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and further consent to the reference to us under
the caption "Legal Matters" in the Prospectus and the Prospectus Supplement.
Very truly yours,
/s/ WALLER LANSDEN DORTCH & DAVIS,
A Professional Limited Liability Company
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EXHIBIT 8
WALLER LANSDEN DORTCH & DAVIS
A PROFESSIONAL LIMITED LIABILITY COMPANY
NASHVILLE CITY CENTER
511 UNION STREET, SUITE 2100
POST OFFICE BOX 198966
NASHVILLE, TENNESSEE 37219-8966
(615) 244-6380
FACSIMILES 809 SOUTH MAIN STREET
(615) 244-6804 P. O. BOX 1035
(615) 244-5686 COLUMBIA, TN 38402-1035
(615) 388-6031
November 18, 1997
JDN Realty Corporation
3340 Peachtree Road
Suite 1530
Atlanta, Georgia 30326
RE: JDN REALTY CORPORATION -- PROSPECTUS SUPPLEMENT
(TO THE PROSPECTUS DATED OCTOBER 30, 1997)
Ladies and Gentlemen:
We have acted as special tax counsel to JDN Realty Corporation, a
Maryland corporation (the "Company"), in connection with the public offering of
up to 3,000,000 shares of common stock of the Company together with up to an
additional 450,000 shares of common stock subject to an underwriters'
over-allotment option (collectively, the "Shares"), as more fully described in
the Company's Prospectus Supplement dated November 12, 1997 (to the Prospectus
dated October 30, 1997), pursuant to a Registration Statement on Form S-3 (File
No. 333-38611) (the "Registration Statement"). In connection with the public
offering, you have requested our opinion that the Company is qualified as a real
estate investment trust ("REIT") under Sections 856 through 860 of the Internal
Revenue Code of 1986, as amended (the "Code") for its taxable years ending
December 31, 1994, December 31, 1995, and December 31, 1996 and its current
method of organization and operation will enable it to continue to qualify as a
REIT. All capitalized terms in this opinion which are defined in the
Registration Statement or the Prospectus Supplement shall have the same
respective meanings as set forth in the Registration Statement or the Prospectus
Supplement pertaining to the offering.
In rendering our opinion, we have examined and relied upon the
following documents and other materials:
1. Schedules prepared or delivered by officials of the Company
setting forth:
(a) REIT taxable and gross income for the short taxable year
ended December 31, 1994 and for fiscal years ended December 31, 1995
and 1996, together with a schedule of actual dividends distributed and
projected dividends to be distributed in accordance with Code Section
858 and compliance with the distribution requirements of Code Section
857(a);
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JDN Realty Corporation
November 18, 1997
Page 2
(b) Compliance with the applicable REIT ratios or tests for
the fiscal years ended December 31, 1994, 1995, and 1996 and projected
compliance with such tests for the fiscal year ending December 31,
1997, including:
Income tests:
(1) 95% gross income test for the year;
(2) 75% gross income test for the year;
(3) 30% gross income test for the year; and
Asset tests:
(1) 75% asset test at the end of each quarter through
September 30, 1997;
(2) 25% asset test at the end of each quarter through
September 30, 1997;
(3) 10% asset test at the end of each quarter through
September 30, 1997;
(4) 5% asset test at the end of each quarter through
September 30, 1997.
2. The Company's certificate, dated as of November 18, 1997.
In addition, we have examined such additional records, documents,
certificates and other instruments and made such investigations of fact and law
as in our judgment are necessary or appropriate to enable us to render the
opinion expressed below.
In rendering our opinion, we have relied upon the following
representations of the Company. To the extent that the representations of the
Company are with respect to matters set forth in the Code or Treasury
Regulations, we have discussed with the Company's officers the relevant
provisions of the Code, the applicable Treasury Regulations and published
administrative interpretations thereof.
1. The common stock of the Company has been since the completion of the
initial public offering, and will continue to be beneficially owned by over 100
shareholders (persons), as defined for purposes of Section 856(a)(5) of the
Code; and five or fewer shareholders have not owned, directly or indirectly
under the rules of Section 544 as modified by Section 856(h) of the Code, at any
time since the completion of the initial public offering, over 50% in value of
the stock of the Company; and no shareholder will own, directly or indirectly,
over 8% in number of shares or value of the outstanding stock of the Company;
provided, however, that "Excluded Holders" may hold up to the "Excluded Holder
Ownership Limit," as such terms are defined in the Company's Charter.
2. The Company has at all times and will continue to comply with any
and all procedural requirements for REIT status set forth in Sections 856
through 860 of the Code and the regulations thereunder, including the timely
making of such elections and the obtaining and disclosing of such information as
is required on the federal tax return to be filed by the Company.
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JDN Realty Corporation
November 18, 1997
Page 3
3. Additional properties acquired will constitute "real estate assets"
and any other investments made by the REIT will be made in a manner to satisfy
the asset tests of Section 856(c) of the Code.
4. The income from existing and additional leases entered into or
acquired and the income from other investments will not cause the Company to
fail to satisfy the income tests of Section 856(c) of the Code.
5. The Company will actually operate in accordance with its past and
proposed method of operation as described in its filings with the Securities and
Exchange Commission under the Securities Act of 1933 and the Securities Exchange
Act of 1934.
6. The Company had no undistributed "C" corporation earnings and
profits at December 31, 1994, December 31, 1995 or December 31, 1996.
7. The representations contained in the Company's certificate, dated as
of November 18, 1997, are accurate.
8. All partnerships in which the Company may have an ownership interest
will own only "real estate assets" and cash reserves. All activities of those
partnerships will consist of activities permitted to be undertaken by a REIT and
income, other than interest income on cash reserves, shall be "rents from real
property."
9. Each corporation in which the Company has acquired or acquires an
equity interest shall either be a "Qualified REIT Subsidiary" under Section
856(i) of the Code or the Company will not own over ten percent (10%) of the
outstanding voting securities of such corporation or other issuer and the
securities owned of such issuer will not be greater in value than five percent
(5%) of the value of the total assets of the Company.
On the basis of and in reliance of the foregoing, we wish to advise you
that under current law, including relevant statutes, regulations and judicial
and administrative precedent (which law is subject to change on a retroactive
basis), in our opinion:
(a) the Company was organized and has operated in conformity
with the requirements for qualification and taxation as a REIT under
the Code for its taxable years ended December 31, 1994, December 31,
1995, and December 31, 1996 and the Company's current organization and
method of operation will enable it to continue to meet the current
requirements for qualification and taxation as a REIT under the Code;
and
(b) the discussion in the Company's Form 8-K dated March 25,
1997, incorporated into the Prospectus under the heading "Federal
Income Tax and ERISA Considerations" and the discussion in the
Prospectus Supplement under the heading "Certain Federal Income Tax
Considerations" are correct in all material respects and fairly
summarizes the federal income tax considerations that are likely to be
material to a holder of the Shares.
<PAGE> 4
JDN Realty Corporation
November 18, 1997
Page 4
The Company's qualification and taxation as a REIT depend upon the
Company's ability to meet on a continuing basis, through actual annual operating
and other results, the various requirements under the Code and described in or
incorporated by reference into the Registration Statement with regard to, among
other things, the sources of its gross income, the composition of its assets,
the level of its distributions to stockholders, and the diversity of its stock
ownership. Waller Lansden Dortch & Davis, A Professional Limited Liability
Company will not review the Company's compliance with these requirements on a
continuing basis. Accordingly, no assurance can be given that the actual results
of operations of the Company and its subsidiaries, the sources of their income,
the nature of their assets, the level of the Company's distributions to
stockholders and the diversity of its stock ownership for any given taxable year
will satisfy the requirements under the Code for qualification and taxation as a
REIT.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and further consent to the reference to us under the
caption "Legal Matters" in the Prospectus and the Prospectus Supplement and
under the caption "Federal Income Tax Considerations" in the Prospectus.
Very truly yours,
/s/ WALLER LANSDEN DORTCH & DAVIS
A Professional Limited Liability Company
