<PAGE> 1
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported):
February 13, 1998 (February 5, 1998)
------------------------------
JDN REALTY CORPORATION
(Exact Name of Registrant as Specified in Its Charter)
MARYLAND 1-12844 58-1468053
(State or Other (Commission File Number) (I.R.S. Employer
Jurisdiction of 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)
================================================================================
Page 1 of 4
Exhibit Index located on Page 4
<PAGE> 2
ITEM 5. OTHER EVENTS AND INFORMATION.
On February 5, 1998, the Company entered into a distribution
agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated ("Merrill Lynch"), BT Alex. Brown Incorporated, Morgan Stanley &
Co. Incorporated and Salomon Brothers Inc (collectively, the "Agents") relating
to the sale by the Company from time to time of its Medium-Term Notes Due Nine
Months or More From Date of Issue (the "Medium-Term Note Program") in an
aggregate principal amount of up to $505,500,000. The aggregate offering price
under the Medium-Term Note Program is subject to reduction as a result of the
sale by the Company of other securities. A registration statement relating to
these securities has been filed with the Securities and Exchange Commission and
was declared effective on October 30, 1997.
On February 4, 1998, the Company purchased a portfolio of
five shopping centers in Milwaukee, Wisconsin, aggregating 1,115,189 square
feet, for a purchase price of approximately $58.4 million. JDN West Allis
Associates, Limited Partnership, a Georgia limited partnership (the
"Partnership"), of which the Company is the sole general partner, was organized
in connection with the acquisition of one of these shopping centers. As part of
the purchase price for this shopping center, the Partnership issued $3 million
in value of units of limited partnership interest (the "Units") to seven
limited partners. Subject to certain conditions and limitations including, but
not limited to, compliance with state and federal securities laws, the Units
are, at any time after one year from the date of the closing of this purchase,
exchangeable into registered and freely transferable shares of the Company's
Common Stock.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(C) EXHIBITS.
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
1.1 Distribution Agreement, dated February 5, 1998, by and between the
Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
BT Alex. Brown Incorporated, Morgan Stanley & Co. Incorporated and Salomon Brothers Inc
4.1 Second Supplemental Indenture, dated as of February 5, 1998, by the
Company to First Union National Bank, as Trustee
4.2 Form of Medium-Term Note (Fixed Rate)
4.3 Form of Medium-Term Note (Floating Rate)
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)
25 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of First Union National Bank, pertaining
to the Company's Medium-Term Notes Due Nine Months or More From Date of Issue
</TABLE>
Page 2 of 4
<PAGE> 3
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
JDN REALTY CORPORATION
By: /s/ William J. Kerley
---------------------------------
William J. Kerley
Chief Financial Officer
Date: February 12, 1998
Page 3 of 4
<PAGE> 4
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Description
- ----------- -----------
<S> <C>
1.1 Distribution Agreement, dated February 5, 1998, by and between the
Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith Incorporated,
BT Alex. Brown Incorporated, Morgan Stanley & Co. Incorporated and Salomon Brothers Inc
4.1 Second Supplemental Indenture, dated as of February 5, 1998, by the
Company to First Union National Bank, as Trustee
4.2 Form of Medium-Term Note (Fixed Rate)
4.3 Form of Medium-Term Note (Floating Rate)
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)
25 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939, as amended, of First Union National Bank, pertaining
to the Company's Medium-Term Notes Due Nine Months or More From Date of Issue
</TABLE>
Page 4 of 4
<PAGE> 1
EXHIBIT 1.1
JDN REALTY CORPORATION
MEDIUM-TERM NOTES
DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
DISTRIBUTION AGREEMENT
February 5, 1998
MERRILL LYNCH & CO.
Merrill Lynch, Pierce, Fenner & Smith
Incorporated
World Financial Center
North Tower, 10th Floor
New York, New York 10281-1310
BT Alex. Brown Incorporated
130 Liberty Street
25th Floor
New York, New York 10006
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
Smith Barney Inc.
388 Greenwich Street
New York, New York 10013
Dear Sirs:
JDN Realty Corporation, a Maryland corporation (the "Company"),
confirms its agreement with Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner &
Smith Incorporated, BT Alex. Brown Incorporated, Morgan Stanley & Co.
Incorporated and Smith Barney Inc. (each, an "Agent," and collectively, the
"Agents") with respect to the issue and sale by the Company of its Medium-Term
Notes Due Nine Months or More From Date of Issue (the "Notes"). The Notes are to
be issued pursuant to an Indenture, dated as of July 15, 1997, as amended,
supplemented or modified from time to time (the "Indenture"), between the
Company and First Union National Bank, as trustee (the "Trustee"). As of the
date hereof, the Company has authorized the issuance and sale of up to U.S.
$505,500,000 aggregate initial offering price of Notes (or its equivalent, based
upon the exchange rate on the applicable trade date in such foreign or composite
currencies as the Company shall designate at the time of issuance) to or through
the Agents pursuant to the terms of this Agreement. It is understood, however,
that the Company may from time to time authorize the issuance of additional
Notes and that such additional Notes may be sold to or through the Agents
pursuant to the terms of this Agreement, all as though the issuance of such
Notes were authorized as of the date hereof.
<PAGE> 2
This Agreement provides both for the sale of Notes by the Company to
one or more Agents as principal for resale to investors and other purchasers and
for the sale of Notes by the Company directly to investors through an Agent
acting as an agent of the Company in soliciting offers for the purchase of Notes
(as may from time to time be agreed to by the Company and the applicable Agent).
The Company reserves the right to sell Notes directly to investors on its own
behalf, provided that the Company notifies the Agents prior to any such sale.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (No. 333-38611) for the
registration of common stock, common stock warrants, preferred stock and debt
securities, including the Notes, under the Securities Act of 1933, as amended
(the "1933 Act"), and the offering thereof from time to time in accordance with
Rule 415 of the rules and regulations of the Commission under the 1933 Act (the
"1933 Act Regulations"), and the Company will have filed such post-effective
amendments thereto as may be required prior to any acceptance by the Company of
an offer for the purchase of Notes. Such registration statement (as so amended,
if applicable) has been declared effective by the Commission and the Indenture
has been duly qualified under the Trust Indenture Act of 1939, as amended (the
"1939 Act"). Such registration statement (as so amended, if applicable) is
referred to herein as the "Registration Statement"; and the final prospectus and
all applicable amendments or supplements thereto (including the final prospectus
supplement and pricing supplement relating to the offering of Notes), in the
form furnished to the applicable Agent(s) for use in connection with the
offering of Notes, are collectively referred to herein as the "Prospectus";
provided, however, that all references to the "Registration Statement" and the
"Prospectus" shall also be deemed to include all documents incorporated therein
by reference pursuant to the Securities Exchange Act of 1934, as amended (the
"1934 Act"), prior to any acceptance by the Company of an offer for the purchase
of Notes; provided, further, that if the Company files a registration statement
with the Commission pursuant to Rule 462(b) of the 1933 Act Regulations (the
"Rule 462(b) Registration Statement"), then, after such filing, all references
to the "Registration Statement" shall also be deemed to include the Rule 462(b)
Registration Statement. A "preliminary prospectus" shall be deemed to refer to
any prospectus furnished by the Company after the Registration Statement became
effective and before any acceptance by the Company of an offer for the purchase
of Notes which omitted information to be included upon pricing in a form of
prospectus filed with the Commission pursuant to Rule 424(b) of the 1933 Act
Regulations. For purposes of this Agreement, all references to the Registration
Statement, Prospectus or preliminary prospectus or to any amendment or
supplement thereto shall be deemed to include any copy filed with the Commission
pursuant to its Electronic Data Gathering, Analysis and Retrieval system
("EDGAR").
All references in this Agreement to financial statements and schedules
and other information which is "disclosed," "contained," "included" or "stated"
(or other references of like import) in the Registration Statement, Prospectus
or preliminary prospectus shall be deemed to include all such financial
statements and schedules and other information which is incorporated by
reference in the Registration Statement, Prospectus or preliminary prospectus,
as the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement, Prospectus or preliminary prospectus
shall be deemed to include the filing of any document under the 1934 Act which
is incorporated by reference in the Registration Statement, Prospectus or
preliminary prospectus, as the case may be.
1. Appointment as Agent.
(a) Appointment. Subject to the terms and conditions stated herein and
subject to the reservation by the Company of the right to sell Notes directly on
its own behalf, the Company hereby agrees that Notes will be sold exclusively to
or through the Agents and the Company agrees that it will not appoint any other
agents to act on its behalf, or to assist it, in the placement of the Notes.
Notwithstanding the foregoing, the Company may appoint, upon at least 20 days'
prior written notice to the Agents, additional persons to serve as Agents
hereunder (provided that such persons are engaged on the same terms and
conditions as those contained in this Agreement).
(b) Sale of Notes. The Company shall not sell or approve the
solicitation of offers for the purchase of Notes in excess of the amount which
shall be authorized by the Company from time to time or in excess of the
aggregate initial offering price of Notes registered pursuant to the
Registration Statement. The Agents shall have no responsibility for maintaining
records with respect to the aggregate initial offering price of Notes sold, or
of otherwise monitoring the availability of Notes for sale, under the
Registration Statement.
2
<PAGE> 3
(c) Purchases as Principal. The Agents shall not have any obligation to
purchase Notes from the Company as principal. However, absent an agreement
between an Agent and the Company that such Agent shall be acting solely as an
agent for the Company, such Agent shall be deemed to be acting as principal in
connection with any offering of Notes by the Company through such Agent.
Accordingly, the Agents, individually or in a syndicate, may agree from time to
time to purchase Notes from the Company as principal for resale to investors and
other purchasers determined by such Agents. Any purchase of Notes from the
Company by an Agent as principal shall be made in accordance with Section 3(a)
hereof.
(d) Solicitations as Agent. If agreed upon between an Agent and the
Company, such Agent, acting solely as an agent for the Company and not as
principal, will solicit offers for the purchase of Notes. Such Agent will
communicate to the Company, orally or in writing, each reasonable offer for the
purchase of Notes solicited by it on an agency basis other than those offers
rejected by such Agent. Such Agent shall have the right, in its discretion
reasonably exercised, to reject any offer for the purchase of Notes, in whole or
in part, and any such rejection shall not be deemed a breach of its agreement
contained herein. The Company may accept or reject any offer for the purchase of
Notes, in whole or in part. Such Agent shall make reasonable efforts to assist
the Company in obtaining performance by each purchaser whose offer for the
purchase of Notes has been solicited by it on an agency basis and accepted by
the Company. Such Agent shall not have any liability to the Company if any such
purchase is not consummated for any reason. If the Company shall default on its
obligation to deliver Notes to a purchaser whose offer has been solicited by
such Agent on an agency basis and accepted by the Company, the Company shall (i)
hold such Agent harmless against any loss, claim or damage arising from or as a
result of such default by the Company and (ii) pay to such Agent any commission
to which it would otherwise be entitled absent such default.
(e) Reliance. The Company and the Agents agree that any Notes purchased
from the Company by one or more Agents as principal shall be purchased, and any
Notes the placement of which an Agent arranges as an agent of the Company shall
be placed by such Agent, in reliance on the representations, warranties,
covenants and agreements of the Company contained herein and on the terms and
conditions and in the manner provided herein.
2. Representations and Warranties.
(a) The Company represents and warrants to each Agent as of the date
hereof, as of the date of each acceptance by the Company of an offer for the
purchase of Notes (whether to such Agent as principal or through such Agent as
agent), as of the date of each delivery of Notes (whether to such Agent as
principal or through such Agent as agent) (the date of each such delivery to
such Agent as principal is referred to herein as a "Settlement Date"), and as of
any time that the Registration Statement or the Prospectus shall be amended or
supplemented (each of the times referenced above is referred to herein as a
"Representation Date"), as follows:
(i) Due Incorporation, Good Standing and Due Qualification of
the Company. The Company has been duly organized and is validly
existing as a corporation in good standing under the laws of the State
of Maryland with corporate power and authority to own, lease and
operate its properties and to conduct its business as described in the
Prospectus and to enter into this Agreement and consummate the
transactions contemplated hereunder and in the Indenture and the
Prospectus; the Company is duly qualified as a foreign corporation to
transact business and is in good standing in each jurisdiction in which
such qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not result in a
material adverse change in the condition, financial or otherwise, or in
the earnings, business affairs or business prospects of the Company and
its subsidiaries considered as one enterprise (a "Material Adverse
Effect"); all of the issued and outstanding shares of capital stock of
the Company have been duly authorized and are validly issued, fully
paid and non-assessable; and none of the outstanding shares of capital
stock of the Company were issued in violation of preemptive or other
similar rights of any securityholder of the Company.
(ii) Due Incorporation, Good Standing and Due Qualification of
Significant Subsidiaries. Each significant subsidiary (as such term is
defined in Rule 1-02 of Regulation S-X promulgated under the
3
<PAGE> 4
1933 Act), if any, and JDN Development Company, Inc. (each, a
"Significant Subsidiary") has been duly organized and is validly
existing in good standing under the laws of the jurisdiction of its
formation, has the requisite power and authority to own, lease and
operate its properties and conduct its business as described in the
Prospectus and is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or
leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not result in a
Material Adverse Effect; except as stated in the Prospectus, all of the
issued and outstanding equity securities of each Significant Subsidiary
have been duly authorized and are validly issued, fully paid and
non-assessable and are owned by the Company, directly or through
subsidiaries (except in the case of JDN Development Company, Inc., the
outstanding voting stock of which is owned 99% by J. Donald Nichols and
1% by the Company, and the outstanding non-voting stock of which is
owned 100% by the Company), free and clear of any security interest,
mortgage, pledge, lien, encumbrance, claim or equity; and none of the
outstanding shares of capital stock of any Significant Subsidiary was
issued in violation of preemptive or other similar rights of any
securityholder of such Significant Subsidiary.
(iii) Registration Statement and Prospectus. The Company meets
the requirements for use of Form S-3 under the 1933 Act; the
Registration Statement (including any Rule 462(b) Registration
Statement) has become effective under the 1933 Act and no stop order
suspending the effectiveness of the Registration Statement (including
any Rule 462(b) Registration Statement) has been issued under the 1933
Act and no proceedings for that purpose have been instituted or are
pending or, to the knowledge of the Company, are contemplated by the
Commission, and any request on the part of the Commission for
additional information has been complied with; the Indenture has been
duly qualified under the 1939 Act; at the respective times that the
Registration Statement, any Rule 462(b) Registration Statement and any
post-effective amendment thereto (including the filing of the Company's
most recent Annual Report on Form 10-K with the Commission (the "Annual
Report on Form 10-K")) became effective and at each Representation
Date, the Registration Statement (including any Rule 462(b)
Registration Statement) and any amendments thereto complied and will
comply in all material respects with the requirements of the 1933 Act
and the 1933 Act Regulations and the 1939 Act and the rules and
regulations of the Commission under the 1939 Act (the "1939 Act
Regulations") and did not and will 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;
each preliminary prospectus and prospectus filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424 under the 1933 Act, complied
when so filed in all material respects with the 1933 Act Regulations;
each preliminary prospectus and the Prospectus delivered to the
applicable Agent(s) for use in connection with the offering of Notes
are, or will be at the time of such delivery, identical to any
electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T;
and at the date hereof, at the date of the Prospectus and at each
Representation Date, neither the Prospectus nor any amendment or
supplement thereto included or will include an untrue statement of a
material fact or omitted or will 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; provided,
however, that the representations and warranties in this subsection
shall not apply to statements in or omissions from the Registration
Statement or the Prospectus made in reliance upon and in conformity
with information furnished to the Company in writing by the Agents
expressly for use in the Registration Statement or the Prospectus.
(iv) Incorporated Documents. The documents incorporated or
deemed to be incorporated by reference in the Registration Statement
and the Prospectus, at the time they were or hereafter are filed with
the Commission, complied and will comply in all material respects with
the requirements of the 1934 Act and the rules and regulations of the
Commission under the 1934 Act (the "1934 Act Regulations") and, when
read together with the other information in the Prospectus, at the date
hereof, at the date of the Prospectus and at each Representation Date,
did not and will not include an 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.
4
<PAGE> 5
(v) Independent Accountants. The accountants who audited
the financial statements and any supporting schedules thereto included
in the Registration Statement and the Prospectus are independent public
accountants as required by the 1933 Act and the 1933 Act Regulations.
(vi) Financial Statements. The consolidated financial
statements of the Company included in the Registration Statement and
the Prospectus, together with the related schedules and notes, as well
as those financial statements, schedules and notes of any other entity
included in the Registration Statement and the Prospectus, present
fairly the consolidated financial position of the Company and its
subsidiaries, or such other entity, as the case may be, at the dates
indicated and the consolidated statements of operations, shareholders'
equity and cash flows of the Company and its subsidiaries, or such
other entity, as the case may be, for the periods specified; the
combined statements of revenue and certain expenses of certain
properties acquired or to be acquired by the Company included in the
Registration Statement and the Prospectus, together with the related
notes, present fairly the combined revenues and expenses of such
properties at the dates indicated; such financial statements have been
prepared in conformity with generally accepted accounting principles
("GAAP") applied on a consistent basis throughout the periods involved;
the supporting schedules, if any, included in the Registration
Statement and the Prospectus, when considered in relation to the basic
financial statements taken as a whole, present fairly in accordance
with GAAP the information required to be stated therein; any selected
financial data and the summary financial information included in the
Registration Statement and the Prospectus present fairly the
information shown therein and have been compiled on a basis consistent
with that of the audited financial statements included in the
Registration Statement and the Prospectus; and any pro forma
consolidated financial statements of the Company and its subsidiaries
and the related notes thereto included in the Registration Statement
and the Prospectus present fairly the information shown therein, have
been prepared in accordance with the Commission's rules and guidelines
with respect to pro forma financial statements, with the exception of
adjustment (6) in footnote 14 to the Company's financial statements for
the year ending December 31, 1994 included in the Company's Form 10-K
for the year ended December 31, 1996, and have been properly compiled
on the bases described therein, and the assumptions used in the
preparation thereof are reasonable and the adjustments used therein are
appropriate to give effect to the transactions and circumstances
referred to therein.
(vii) No Material Changes. Since the respective dates as of
which information is given in the Registration Statement and the
Prospectus, except as otherwise stated therein, (1) there has been no
event or occurrence that would result in a Material Adverse Effect and
(2) there have been no transactions entered into by the Company or any
of its subsidiaries, other than those in the ordinary course of
business, which are material with respect to the Company and its
subsidiaries considered as one enterprise.
(viii) Authorization, etc. of this Agreement, the Indenture
and the Notes. This Agreement has been duly authorized, executed and
delivered by the Company; the Indenture has been duly authorized,
executed and delivered by the Company and will be a valid and legally
binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as enforcement thereof may be limited
by (1) bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally,
(2) general equitable principles (regardless of whether enforcement is
considered in a proceeding in equity or at law), (3) requirements that
a claim with respect to any debt securities issued under the Indenture
that are payable in a foreign or composite currency (or a foreign or
composite currency judgment in respect of such claim) be converted into
U.S. dollars at a rate of exchange prevailing on a date determined
pursuant to applicable law or (4) governmental authority to limit,
delay or prohibit the making of payments outside the United States; the
Notes have been duly authorized by the Company for offer, sale,
issuance and delivery pursuant to this Agreement and, when issued,
authenticated and delivered in the manner provided for in the Indenture
and delivered against payment of the consideration therefor, will
constitute valid and legally binding obligations of the Company,
enforceable against the Company in accordance with their terms, except
as enforcement thereof may be limited by (1) bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally, (2) general equitable
principles (regardless of whether enforcement is considered in a
proceeding in equity or at law), (3) requirements that a claim with
respect to any Notes payable in a foreign or composite currency (or a
foreign or
5
<PAGE> 6
composite currency judgment in respect of such claim) be converted into
U.S. dollars at a rate or exchange prevailing on a date determined
pursuant to applicable law or (4) governmental authority to limit,
delay or prohibit the making of payments outside the United States; the
Notes will be substantially in the form contemplated by the Indenture;
and each holder of Notes will be entitled to the benefits of the
Indenture.
(ix) Descriptions of the Indenture and the Notes. The
Indenture and the Notes conform and will conform in all material
respects to the statements relating thereto contained in the Prospectus
and are substantially in the form filed or incorporated by reference,
as the case may be, as an exhibit to the Registration Statement.
(x) Accuracy of Exhibits. There are no contracts or
documents which are required to be described in the Registration
Statement, the Prospectus or the documents incorporated by reference
therein or to be filed as exhibits thereto which have not been so
described and/or filed as required.
(xi) Absence of Defaults and Conflicts. Neither the Company
nor any of its subsidiaries is in violation of the provisions of its
charter or by-laws or in default in the performance or observance of
any obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, deed of trust, loan or credit agreement,
note, lease or other agreement or instrument to which the Company or
any of its subsidiaries is a party or by which it or any of them may be
bound or to which any of the property or assets of the Company or any
of its subsidiaries is subject (collectively, "Agreements and
Instruments"), except for such defaults that would not result in a
Material Adverse Effect; and the execution, delivery and performance of
this Agreement, the Indenture, the Notes and any other agreement or
instrument entered into or issued or to be entered into or issued by
the Company in connection with the transactions contemplated by the
Prospectus, the consummation of the transactions contemplated in the
Prospectus (including the issuance and sale of the Notes and the use of
proceeds therefrom as described in the Prospectus) and the compliance
by the Company with its obligations hereunder and under the Indenture,
the Notes and such other agreements or instruments have been duly
authorized by all necessary corporate action and do not and will not,
whether with or without the giving of notice or the passage of time or
both, conflict with or constitute a breach of, or default or event or
condition which gives the holder of any note, debenture or other
evidence of indebtedness (or any person acting on such holder's behalf)
the right to require the repurchase, redemption or repayment of all or
a portion of such indebtedness by the Company or any of its
subsidiaries (a "Repayment Event") under, or result in the creation or
imposition of any lien, charge or encumbrance upon any assets,
properties or operations of the Company or any of its subsidiaries
pursuant to, any Agreements and Instruments, except for such conflicts,
breaches, defaults, events or conditions, liens, charges or
encumbrances that would not result in a Material Adverse Effect, nor
will such action result in any violation of the provisions of the
charter or by-laws of the Company or any of its subsidiaries or any
applicable law, statute, rule, regulation, judgment, order, writ or
decree of any government, government instrumentality or court, domestic
or foreign, having jurisdiction over the Company or any of its
subsidiaries or any of their assets, properties or operations, except
for such violations of laws, statutes, regulations, judgments, writs or
decrees that would not result in a Material Adverse Effect.
(xii) Absence of Labor Disputes. No labor dispute with the
employees of the Company or any of its subsidiaries exists or, to the
knowledge of the Company, is imminent, and the Company is not aware of
any existing or imminent labor disturbance by the employees of any of
its or any subsidiary's principal suppliers, customers or contractors,
which, in either case, may reasonably be expected to result in a
Material Adverse Effect.
(xiii) Absence of Proceedings. There is no action, suit,
proceeding, inquiry or investigation before or brought by any court or
governmental agency or body, domestic or foreign, now pending, or to
the knowledge of the Company threatened, against or affecting the
Company or any of its subsidiaries which is required to be disclosed in
the Registration Statement and the Prospectus (other than as stated
therein), or which may reasonably be expected to result in a Material
Adverse Effect, or which may reasonably be expected to materially and
adversely affect the performance by the Company of its obligations
under this Agreement, the Indenture and the Notes or the consummation
of the transactions contemplated in the
6
<PAGE> 7
Prospectus; and the aggregate of all pending legal or governmental
proceedings to which the Company or any of its subsidiaries is a party
or of which any of their respective assets, properties or operations is
the subject which are not disclosed in the Registration Statement and
the Prospectus, including ordinary routine litigation incidental to the
business, may not reasonably be expected to result in a Material
Adverse Effect.
(xiv) Possession of Intellectual Property. The Company and
its subsidiaries own or possess, or can acquire on reasonable terms,
adequate patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems or
procedures), trademarks, service marks, trade names or other
intellectual property (collectively, "Intellectual Property") necessary
to carry on the business now operated by them, and neither the Company
nor any of its subsidiaries has received any notice or is otherwise
aware of any infringement of or conflict with asserted rights of others
with respect to any Intellectual Property or of any facts or
circumstances which would render any Intellectual Property invalid or
inadequate to protect the interest of the Company or any of its
subsidiaries therein, and which infringement, conflict, invalidity or
inadequacy, singly or in the aggregate, if the subject of any
unfavorable decision, ruling or finding, would result in a Material
Adverse Effect.
(xv) Possession of Licenses and Permits. The Company and its
subsidiaries possess such permits, licenses, approvals, consents and
other authorizations (collectively, "Governmental Licenses") issued by
the appropriate federal, state, local or foreign regulatory agencies or
bodies necessary to conduct the business now operated by them; the
Company and its subsidiaries are in compliance with the terms and
conditions of all such Governmental Licenses, except where the failure
so to comply would not, singly or in the aggregate, result in a
Material Adverse Effect; all of the Governmental Licenses are valid and
in full force and effect, except where the invalidity of such
Governmental Licenses or the failure of such Governmental Licenses to
be in full force and effect would not result in a Material Adverse
Effect; and neither the Company nor any of its subsidiaries has
received any notice of proceedings relating to the revocation or
modification of any such Governmental Licenses which, singly or in the
aggregate, if the subject of an unfavorable decision, ruling or
finding, would result in a Material Adverse Effect.
(xvi) Title to Property. The Company and its subsidiaries
have good and marketable title to all real property owned by the
Company and its subsidiaries and good title to all other properties
owned by them, in each case, free and clear of all mortgages, pledges,
liens, security interests, claims, restrictions or encumbrances of any
kind, except (A) as otherwise stated in the Registration Statement and
the Prospectus or (B) those which do not, singly or in the aggregate,
materially affect the value of such property and do not interfere with
the use made and proposed to be made of such property by the Company or
any of its subsidiaries; and all of the leases and subleases material
to the business of the Company and its subsidiaries considered as one
enterprise, and under which the Company or any of its subsidiaries
holds properties described in the Prospectus, are in full force and
effect, and neither the Company nor any of its subsidiaries has
received any notice of any material claim of any sort that has been
asserted by anyone adverse to the rights of the Company or any of its
subsidiaries under any of such leases or subleases, or affecting or
questioning the rights of the Company or such subsidiary of the
continued possession of the leased or subleased premises under any such
lease or sublease.
(xvii) Environmental Laws. Except as disclosed in or
incorporated by reference in the Prospectus, the Company has no
knowledge that any of its real properties (each a "Property") has ever
been used for the disposal, release, handling, treatment, or storage of
any Hazardous Material in any quantity or form that would reasonably
necessitate any responses or corrective action, including any such
action under any Hazardous Material Law; the Company has no knowledge
that any Property has ever been used, and neither the Company
(including its predecessor, JDN Enterprises, Inc. ("Enterprises")) nor
any owner of a Property in which J. Donald Nichols had or has a direct
or indirect interest ("JDN Property") has used any JDN Property, in any
manner other than in full compliance with all Hazardous Material Laws;
none of the Company (including Enterprises), the owner of any JDN
Property or, to the Company's knowledge, any owner of any other
Property has ever received written or oral notice or other
communication of pending or threatened claims, actions, suits,
proceedings or investigations related to any
7
<PAGE> 8
Property regarding (i) the disposal or release of solid, liquid or
gaseous waste into the environment, (ii) the treatment, storage,
disposal, release or other handling of any Hazardous Material, (iii)
the placement of structures or materials into waters of the United
States, (iv) the presence of any Hazardous Material in any building or
structure located on any Property, (v) the presence of any Hazardous
Material related to the ownership, use, condition, or operation of any
Property, or (vi) any alleged violation of any Hazardous Material Law;
other than knowledge of (1) a remediation agreement (relating to a
leaking underground storage tank) entered into between the State of
Georgia and the owner of the Stop `n' Go site adjacent to the QuikTrip
parcel located at the Company's Lawrenceville Property, (2) a
remediation agreement (relating to soil and groundwater contamination)
entered into between the state of North Carolina and the owner of a
tract adjoining the Company's Greenville, North Carolina Property, (3)
a limited Phase II environmental assessment recommendation that
impacted soils be remediated at the Greensboro, North Carolina
Property, (4) a corrective action plan required by the State of Georgia
(relating to a release from underground storage tanks) of the owner of
the SAV-A-TON Gasoline Station site near the Company's Ft. Oglethorpe,
Georgia property, and (5) a corrective action plan required by the
State of Georgia (relating to soil and ground water affected by an
underground storage tank release) of the owner of the Golden Gallon
site near the Company's Lafayette, Georgia property, the Company has no
knowledge that any soil or water in or adjacent to any Property is
contaminated by any Hazardous Material; to the Company's knowledge,
there are no underground tanks or any other underground storage
facilities located on any Property, and to the Company's knowledge,
except as disclosed in or incorporated by reference into the
Prospectus, there have never been such tanks or facilities on any
Property.
Except as disclosed in or incorporated by reference into the
Prospectus, the Company has no knowledge that any real property
previously owned by the Company (including Enterprises) or by any owner
of the JDN Properties (collectively, the "Previously Owned Properties")
has ever been used for the disposal, release, handling, treatment or
storage of any Hazardous Material in any quantity or form that would
reasonably necessitate any responses or corrective action, including
any such action under any Hazardous Material Law; the Company has no
knowledge that any Previously Owned Property has ever been used and
neither the Company (including Enterprises) nor any owner of a JDN
Property has used any Previously Owned Property in any manner other
than in full compliance with all Hazardous Material Laws; neither the
Company (including Enterprises) nor the owner of any Previously Owned
Property has ever received written notice or oral notice or other
communication of pending or threatened claims, actions, suits,
proceedings or investigations relating to any Previously Owned Property
regarding (i) the disposal or release of solid, liquid or gaseous waste
into the environment, (ii) the treatment, storage, disposal, release or
other handling of any Hazardous Material, (iii) the placement of
structures or materials into water of the United States, (iv) the
presence of any Hazardous Material in any building or structure located
on any Previously Owned Property, (v) the presence of any Hazardous
Material related to the ownership, use, condition or operation of any
Previously Owned Property or (vi) any alleged violation of any
Hazardous Material Law; to the Company's knowledge, there were no
underground tanks or any other underground storage facilities located
on any Previously Owned Property during the time period prior to and
including the period that any Previously Owned Property was owned by
the Company (or Enterprises) or any owner of a JDN Property.
As used herein, "Hazardous Material" shall include, without
limitation, any substance which is controlled, regulated or prohibited
under any Hazardous Material Law. "Hazardous Material Law" shall mean
any local, state and federal law relating to the environment and
environmental conditions, including, without limitation, the Resource
Conservation and Recovery Act of 1976 ("RCRA"), 42 U.S.C. ss. 6901 et
seq., the Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("CERCLA"), 42 U.S.C. ss.ss. 9601-9637, as
amended by the Superfund Amendments and Reauthorization Act of 1986
("SARA"), the Hazardous Materials Transportation Act, 49 U.S.C. ss.
6901, et seq., the Federal Water Pollution Control Act, 33 U.S.C.
ss.ss. 1251 et seq., the Clean Air Act, 42 U.S.C. ss.ss. 741, et seq.,
the Clean Water Act, 33 U.S.C. ss. 7401, et seq., the Toxic Substances
Control Act, 15 U.S.C. ss.ss. 2601-2629, and the Safe Drinking Water
Act, 42 U.S.C. ss.ss. 300f-300j.
8
<PAGE> 9
(xviii) No Filings, Regulatory Approvals etc. No filing with,
or approval, authorization, consent, license, registration,
qualification, order or decree of, any court or governmental authority
or agency, domestic or foreign, is necessary or required for the
performance by the Company of its obligations under this Agreement, the
Indenture and the Notes or in connection with the transactions
contemplated in the Prospectus, except such as have been previously
obtained or rendered, as the case may be, except compliance with the
listing requirements of any securities exchange on which Notes are
listed or approval of the National Association of Securities Dealers,
Inc. (the "NASD"), if applicable.
(xix) Investment Company Act. The Company is not, and upon
the issuance and sale of the Notes as herein contemplated and the
application of the net proceeds therefrom as described in the
Prospectus will not be, an "investment company" within the meaning of
the Investment Company Act of 1940, as amended (the "1940 Act").
(xx) Commodity Exchange Act. The Notes, upon issuance, will
be excluded or exempted under, or beyond the purview of, the Commodity
Exchange Act, as amended (the "Commodity Exchange Act"), and the rules
and regulations of the Commodity Futures Trading Commission under the
Commodity Exchange Act (the "Commodity Exchange Act Regulations").
(xxi) Ratings. The Medium-Term Note Program under which the
Notes are issued (the "Program"), as well as the Notes, are rated [ ]
by Moody's Investors Service, Inc., [ ] by Standard & Poor's Ratings
Service and [ ] by Duff & Phelps Credit Rating Co., or such other
rating as to which the Company shall have most recently notified the
Agents pursuant to Section 4(a) hereof.
(xxii) Tax Compliance. The Company has filed all federal,
state, local and foreign income tax returns which have been required to
be filed (except in any case in which the failure to so file would not
have a Material Adverse Effect), and has paid all taxes required to be
paid for any other assessment, fine or penalty levied against it, to
the extent that any of the foregoing is due and payable, except, in all
cases, for any such tax, assessment, fine or penalty that is being
contested in good faith. All past due taxes with respect to the
Properties have been paid, and the Company and its subsidiaries have no
liability, and no tax lien or other charge exists with respect to any
Property, that would have a Material Adverse Effect. All material tax
liabilities have been adequately provided for in the financial
statements of the Company.
(xxiii) REIT Qualification. The Company was organized and has
operated in conformity with the requirements for qualification and
taxation as a real estate investment trust ("REIT") for each of its
taxable years beginning with the year ended December 31, 1994, and its
current organization and method of operation should enable it to
continue to meet the requirements for qualification and taxation as a
REIT.
(b) Additional Certifications. Any certificate signed by any officer of
the Company or any of its subsidiaries and delivered to one or more Agents or to
counsel for the Agents in connection with an offering of Notes to one or more
Agents as principal or through an Agent as agent shall be deemed a
representation and warranty by the Company to such Agent or Agents as to the
matters covered thereby on the date of such certificate and, unless subsequently
amended or supplemented, at each Representation Date subsequent thereto.
9
<PAGE> 10
3. Purchases as Principal; Solicitations as Agent.
(a) Purchases as Principal. Notes purchased from the Company by the
Agents, individually or in a syndicate, as principal shall be made in accordance
with terms agreed upon between such Agent or Agents and the Company (which
terms, unless otherwise agreed, shall, to the extent applicable, include those
terms specified in Exhibit A hereto and shall be agreed upon orally, with
written confirmation prepared by such Agent or Agents and delivered to the
Company). An Agent's commitment to purchase Notes as principal shall be deemed
to have been made on the basis of the representations and warranties of the
Company herein contained and shall be subject to the terms and conditions herein
set forth. Unless the context otherwise requires, references herein to "this
Agreement" shall include the applicable agreement of one or more Agents to
purchase Notes from the Company as principal. Each purchase of Notes, unless
otherwise agreed, shall be at a discount from the principal amount of each such
Note equivalent to the applicable commission set forth in Schedule A hereto. The
Agents may engage the services of any broker or dealer in connection with the
resale of the Notes purchased by them as principal and may allow all or any
portion of the discount received from the Company in connection with such
purchases to such brokers or dealers. At the time of each purchase of Notes from
the Company by one or more Agents as principal, such Agent or Agents shall
specify the requirements for the officers' certificate, opinion of counsel and
comfort letter pursuant to Sections 7(b), 7(c) and 7(d) hereof.
If the Company and two or more Agents enter into an agreement pursuant
to which such Agents agree to purchase Notes from the Company as principal and
one or more of such Agents shall fail at the Settlement Date to purchase the
Notes which it or they are obligated to purchase (the "Defaulted Notes"), then
the nondefaulting Agents shall have the right, within 24 hours thereafter, to
make arrangements for one of them or one or more other Agents or underwriters to
purchase all, but not less than all, of the Defaulted Notes in such amounts as
may be agreed upon and upon the terms herein set forth; provided, however, that
if such arrangements shall not have been completed within such 24-hour period,
then:
(a) if the aggregate principal amount of Defaulted Notes does
not exceed 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents on the Settlement Date, the
nondefaulting Agents shall be obligated, severally and not jointly, to
purchase the full amount thereof in the proportions that their
respective initial underwriting obligations bear to the underwriting
obligations of all nondefaulting Agents; or
(b) if the aggregate principal amount of Defaulted Notes
exceeds 10% of the aggregate principal amount of Notes to be so
purchased by all of such Agents on the Settlement Date, such agreement
shall terminate without liability on the part of any nondefaulting
Agent.
No action taken pursuant to this paragraph shall relieve any defaulting Agent
from liability in respect of its default. In the event of any such default which
does not result in a termination of such agreement, either the nondefaulting
Agents or the Company shall have the right to postpone the Settlement Date for a
period not exceeding seven days in order to effect any required changes in the
Registration Statement or the Prospectus or in any other documents or
arrangements.
(b) Solicitations as Agent. On the basis of the representations and
warranties herein contained, but subject to the terms and conditions herein set
forth, when agreed by the Company and an Agent, such Agent, as an agent of the
Company, will use its reasonable efforts to solicit offers for the purchase of
Notes upon the terms set forth in the Prospectus. The Agents are not authorized
to appoint sub-agents with respect to Notes sold through them as agent. All
Notes sold through an Agent as agent will be sold at 100% of their principal
amount unless otherwise agreed upon between the Company and such Agent.
The Company reserves the right, in its sole discretion, to suspend
solicitation of offers for the purchase of Notes through an Agent, as an agent
of the Company, commencing at any time for any period of time or permanently. As
soon as practicable after receipt of instructions from the Company, such Agent
will suspend solicitation of offers for the purchase of Notes from the Company
until such time as the Company has advised such Agent that such solicitation may
be resumed.
10
<PAGE> 11
The Company agrees to pay each Agent a commission, in the form of a
discount, equal to the applicable percentage of the principal amount of each
Note sold by the Company as a result of a solicitation made by such Agent, as an
agent of the Company, as set forth in Schedule A hereto.
(c) Administrative Procedures. The purchase price, interest rate or
formula, maturity date and other terms of the Notes specified in Exhibit A
hereto (as applicable) shall be agreed upon between the Company and the
applicable Agent(s) and specified in a pricing supplement to the Prospectus
(each, a "Pricing Supplement") to be prepared by the Company in connection with
each sale of Notes. Except as otherwise specified in the applicable Pricing
Supplement, the Notes will be issued in denominations of U.S. $1,000 or any
larger amount that is an integral multiple of U.S. $1,000. Administrative
procedures with respect to the issuance and sale of the Notes (the "Procedures")
shall be agreed upon from time to time among the Company, the Agents and the
Trustee. The Agents and the Company agree to perform, and the Company agrees to
cause the Trustee to agree to perform, their respective duties and obligations
specifically provided to be performed by them in the Procedures.
4. Covenants of the Company.
The Company covenants and agrees with each Agent as follows:
(a) Notice of Certain Events. The Company will notify the Agents
immediately, and confirm such notice in writing, of (i) the effectiveness of any
post-effective amendment to the Registration Statement or the filing of any
amendment or supplement to the Prospectus (other than any amendment or
supplement thereto providing solely for the determination of the variable terms
of the Notes or relating solely to the offering of securities other than the
Notes), (ii) the receipt of any comments from the Commission, (iii) any request
by the Commission for any amendment to the Registration Statement or any
amendment or supplement to the Prospectus or for additional information, (iv)
the issuance by the Commission of any stop order suspending the effectiveness of
the Registration Statement, or of any order preventing or suspending the use of
any preliminary prospectus, or of the initiation of any proceedings for that
purpose or (v) any change in the rating assigned by any nationally recognized
statistical rating organization to the Program or any debt securities (including
the Notes) of the Company, or the public announcement by any nationally
recognized statistical rating organization that it has under surveillance or
review, with possible negative implications, its rating of the Program or any
such debt securities, or the withdrawal by any nationally recognized statistical
rating organization of its rating of the Program or any such debt securities.
The Company will make every reasonable effort to prevent the issuance of any
stop order and, if any stop order is issued, to obtain the lifting thereof at
the earliest possible moment.
(b) Filing or Use of Amendments. The Company will give the Agents
advance notice of its intention to file or prepare any additional registration
statement with respect to the registration of additional Notes, any amendment to
the Registration Statement (including any filing under Rule 462(b) of the 1933
Act Regulations) or any amendment or supplement to the prospectus included in
the Registration Statement at the time it became effective or to the Prospectus
(other than an amendment or supplement thereto providing solely for the
determination of the variable terms of the Notes or relating solely to the
offering of securities other than the Notes), whether pursuant to the 1933 Act,
the 1934 Act or otherwise, will furnish to the Agents copies of any such
document a reasonable amount of time prior to such proposed filing or use, as
the case may be, and will not file any such document to which the Agents or
counsel for the Agents shall object.
(c) Delivery of the Registration Statement. The Company has furnished
to each Agent and to counsel for the Agents, without charge, conformed copies of
the Registration Statement as originally filed and of each amendment thereto
(including exhibits filed therewith or incorporated by reference therein and
documents incorporated or deemed to be incorporated by reference therein) and
conformed copies of all consents and certificates of experts. The Registration
Statement and each amendment thereto furnished to the Agents will be identical
to any electronically transmitted copies thereof filed with the Commission
pursuant to EDGAR, except to the extent permitted by Regulation S-T.
11
<PAGE> 12
(d) Delivery of the Prospectus. The Company will deliver to each Agent,
without charge, as many copies of each preliminary prospectus as such Agent may
reasonably request, and the Company hereby consents to the use of such copies
for purposes permitted by the 1933 Act. The Company will furnish to each Agent,
without charge, such number of copies of the Prospectus (as amended or
supplemented) as such Agent may reasonably request. The Prospectus and any
amendments or supplements thereto furnished to the Agents will be identical to
any electronically transmitted copies thereof filed with the Commission pursuant
to EDGAR, except to the extent permitted by Regulation S-T.
(e) Preparation of Pricing Supplements. The Company will prepare, with
respect to any Notes to be sold to or through one or more Agents pursuant to
this Agreement, a Pricing Supplement with respect to such Notes in a form
previously approved by the Agents. The Company will deliver such Pricing
Supplement no later than 11:00 a.m., New York City time, on the business day
following the date of the Company's acceptance of the offer for the purchase of
such Notes and will file such Pricing Supplement pursuant to Rule 424(b)(3)
under the 1933 Act not later than the close of business of the Commission on the
fifth business day after the date on which such Pricing Supplement is first
used.
(f) Revisions of Prospectus -- Material Changes. Except as otherwise
provided in subsection (m) of this Section 4, if at any time during the term of
this Agreement any event shall occur or condition shall exist as a result of
which it is necessary, in the opinion of counsel for the Agents or counsel for
the Company, to amend the Registration Statement in order that the Registration
Statement will 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 or to amend or supplement the Prospectus in
order that the Prospectus will not include an untrue statement of a material
fact or omit to state a material fact necessary in order to make the statements
therein not misleading in the light of the circumstances existing at the time
the Prospectus is delivered to a purchaser, or if it shall be necessary, in the
opinion of either such counsel, to amend the Registration Statement or amend or
supplement the Prospectus in order to comply with the requirements of the 1933
Act or the 1933 Act Regulations, the Company shall give immediate notice,
confirmed in writing, to the Agents to cease the solicitation of offers for the
purchase of Notes in their capacity as agents and to cease sales of any Notes
they may then own as principal, and the Company will promptly prepare and file
with the Commission, subject to Section 4(b) hereof, such amendment or
supplement as may be necessary to correct such statement or omission or to make
the Registration Statement and Prospectus comply with such requirements, and the
Company will furnish to the Agents, without charge, such number of copies of
such amendment or supplement as the Agents may reasonably request. In addition,
the Company will comply with the 1933 Act, the 1933 Act Regulations, the 1934
Act and the 1934 Act Regulations so as to permit the completion of the
distribution of each offering of Notes.
(g) Prospectus Revisions -- Periodic Financial Information. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public interim financial
statement information related to the Company with respect to each of the first
three quarters of any fiscal year or preliminary financial statement information
with respect to any fiscal year, the Company shall furnish such information to
the Agents and shall cause the Prospectus to be amended or supplemented to
include financial information with respect thereto and corresponding information
for the comparable period of the preceding fiscal year, as well as such other
information and explanations as shall be necessary for an understanding thereof
or as shall be required by the 1933 Act or the 1933 Act Regulations.
(h) Prospectus Revisions -- Audited Financial Information. Except as
otherwise provided in subsection (m) of this Section 4, on or prior to the date
on which there shall be released to the general public financial information
included in or derived from the audited consolidated financial statements of the
Company for the preceding fiscal year, the Company shall furnish such
information to the Agents and shall cause the Prospectus to be amended or
supplemented to include such audited consolidated financial statements and the
report or reports, and consent or consents to such inclusion, of the independent
accountants with respect thereto, as well as such other information and
explanations as shall be necessary for an understanding of such consolidated
financial statements or as shall be required by the 1933 Act or the 1933 Act
Regulations.
12
<PAGE> 13
(i) Earnings Statements. The Company will timely file such reports
pursuant to the 1934 Act as are necessary in order to make generally available
to its securityholders as soon as practicable an earnings statement for the
purposes of, and to provide the benefits contemplated by, the last paragraph of
Section 11(a) of the 1933 Act.
(j) Reporting Requirements. The Company, during the period when the
Prospectus is required to be delivered under the 1933 Act or the 1934 Act, will
file all documents required to be filed with the Commission pursuant to the 1934
Act within the time periods prescribed by the 1934 Act and the 1934 Act
Regulations.
(k) Restriction on Offers and Sales of Securities. Unless otherwise
agreed upon between one or more Agents acting as principal and the Company,
between the date of the agreement by such Agent(s) to purchase the related Notes
from the Company and the Settlement Date with respect thereto, the Company will
not, without the prior written consent of such Agent(s), issue, sell, offer or
contract to sell, grant any option for the sale of, or otherwise dispose of, any
debt securities of the Company (other than the Notes that are to be sold
pursuant to such agreement or commercial paper in the ordinary course of
business).
(l) Use of Proceeds. The Company will use the net proceeds received by
it from the issuance and sale of the Notes in the manner specified in the
Prospectus.
(m) Suspension of Certain Obligations. The Company shall not be
required to comply with the provisions of subsections (f), (g) or (h) of this
Section 4 during any period from the time (i) the Agents shall have suspended
solicitation of offers for the purchase of Notes in their capacity as agents
pursuant to a request from the Company and (ii) no Agent shall then hold any
Notes purchased from the Company as principal, as the case may be, until the
time the Company shall determine that solicitation of offers for the purchase of
Notes should be resumed or an Agent shall subsequently purchase Notes from the
Company as principal.
5. Conditions of Agents' Obligations.
The obligations of one or more Agents to purchase Notes from the
Company as principal and to solicit offers for the purchase of Notes as an agent
of the Company, and the obligations of any purchasers of Notes sold through an
Agent as an agent of the Company, will be subject to the accuracy of the
representations and warranties on the part of the Company herein contained or
contained in any certificate of an officer of the Company or any of its
subsidiaries delivered pursuant to the provisions hereof, to the performance and
observance by the Company of its covenants and other obligations hereunder, and
to the following additional conditions precedent:
(a) Effectiveness of Registration Statement. The Registration Statement
(including any Rule 462(b) Registration Statement) has become effective under
the 1933 Act and no stop order suspending the effectiveness of the Registration
Statement shall have been issued under the 1933 Act and no proceedings for that
purpose shall have been instituted or shall be pending or threatened by the
Commission, and any request on the part of the Commission for additional
information shall have been complied with to the reasonable satisfaction of
counsel to the Agents.
(b) Legal Opinions. On the date hereof, the Agents shall have received
the following legal opinions, dated as of the date hereof and in form and
substance satisfactory to the Agents:
(1) Opinions of Counsel for the Company. The favorable opinion
of each of Waller Lansden Dortch & Davis, A Professional Limited
Liability Company ("Waller Lansden"), Brown & Wood LLP ("Brown & Wood")
and McCullough & Sherrill, LLP ("McCullough & Sherrill"), counsel for
the Company, to the effect set forth in Exhibit B hereto and to such
further effect as the Agents may reasonably request.
(2) Opinion of Counsel for the Agents. The favorable opinion
of Hogan & Hartson L.L.P., counsel for the Agents, with respect to the
matters set forth in (1), (6), (7), (8), (9), (17) and the penultimate
paragraph of Exhibit B hereto.
13
<PAGE> 14
(c) Officer's Certificate. On the date hereof, there shall not have
been, since the respective dates as of which information is given in the
Prospectus, any material adverse change in the condition, financial or
otherwise, or in the earnings, business affairs or business prospects of the
Company and its subsidiaries considered as one enterprise, whether or not
arising in the ordinary course of business, and the Agents shall have received a
certificate of the Chairman, President or a Vice President of the Company and of
the Chief Financial Officer or chief accounting officer of the Company, dated as
of the date hereof, to the effect that (i) there has been no such material
adverse change, (ii) the representations and warranties of the Company herein
contained are true and correct with the same force and effect as though
expressly made at and as of the date of such certificate, (iii) the Company has
complied with all agreements and satisfied all conditions on its part to be
performed or satisfied at or prior to the date of such certificate, and (iv) no
stop order suspending the effectiveness of the Registration Statement has been
issued and no proceedings for that purpose have been instituted or are pending
or, to the best of such officer's knowledge, are threatened by the Commission.
(d) Comfort Letter of Ernst & Young LLP. On the date hereof, the Agents
shall have received a letter from Ernst & Young LLP, dated as of the date hereof
and in form and substance satisfactory to the Agents, to the effect that: (i)
they are independent accountants with respect to the Company and its
subsidiaries within the meaning of the 1933 Act and the 1933 Act Regulations;
(ii) it is their opinion that the consolidated financial statements and
supporting schedules included or incorporated by reference in the Registration
Statement and the Prospectus and covered by their opinions therein comply in
form in all material respects with the applicable accounting requirements of the
1933 Act, the 1934 Act, the 1933 Act Regulations and the 1934 Act Regulations;
(iii) based upon limited procedures set forth in detail in such letter (which
shall include, without limitation, the procedures specified by the American
Institute of Certified Public Accountants for a review of interim financial
information as described in SAS No. 71, Interim Financial Information, with
respect to the unaudited financial statements of the Company included or
incorporated by reference in the Registration Statement), nothing has come to
their attention which causes them to believe that, (A) any material
modifications should be made to the unaudited condensed consolidated financial
statements included or incorporated by reference in the Registration Statement
for them to be in conformity with GAAP or (B) the unaudited condensed
consolidated financial statements included or incorporated by reference in the
Registration Statement do not comply as to form in all material respects with
the applicable accounting requirements of the 1934 Act as it applies to Form
10-Q and the related published rules and regulations or (C) at the date of the
latest available consolidated interim financial data, there has been any change
in the capital stock of the Company or increase in the consolidated long-term
debt of the Company or any decrease in the consolidated net assets or
shareholders' equity of the Company, as compared with the amounts shown in the
most recent condensed consolidated balance sheet included or incorporated by
reference in the Registration Statement and the Prospectus or, during the period
from the date of the most recent condensed consolidated statement of operations
included or incorporated by reference in the Registration Statement and the
Prospectus at the date of the latest available consolidated interim financial
data, there were any decreases, as compared with the corresponding period in the
preceding year, in consolidated revenues, or decrease in the total or per share
amounts of consolidated income before extraordinary items or of consolidated net
income of the Company, except in all instances for changes, increases or
decreases which the Registration Statement and the Prospectus disclose have
occurred or may occur; (iv) based upon inquiries of certain officials of the
Company who have responsibility for financial and accounting matters, nothing
came to their attention that (A) there was any change at a specified date not
more than five days prior to the date of such letter in the capital stock,
increase in consolidated long-term debt or any decreases in consolidated net
assets, shareholders' equity and accumulated earnings of the Company as compared
with amounts shown on the most recent condensed consolidated balance sheets
included or incorporated by reference in the Registration Statement and the
Prospectus, or (B) for the period from the date of the latest available
consolidated interim financial data to a specified date not more than five days
prior to the date of such letter, there were any decreases, as compared with the
corresponding period in the preceding year, in consolidated revenues or in the
total or per share amounts of consolidated income before extraordinary items or
of consolidated net income, except in all instances for changes or decreases
which the Registration Statement and Prospectus disclose have occurred or may
occur and (v) in addition to the audit referred to in their opinions and the
limited procedures referred to in clause (iii) above, they have carried out
certain specified procedures with respect to certain amounts, percentages and
financial and statistical information which are included in the Registration
Statement and the Prospectus and which are specified by the Agents, and have
found such amounts, percentages and financial and statistical information to be
in agreement with relevant accounting, financial and other records of the
Company and its subsidiaries identified in such letter.
14
<PAGE> 15
(e) Additional Documents. On the date hereof, counsel to the Agents
shall have been furnished with such documents and opinions as such counsel may
require for the purpose of enabling such counsel to pass upon the issuance and
sale of Notes as herein contemplated and related proceedings, or in order to
evidence the accuracy of any of the representations and warranties, or the
fulfillment of any of the conditions, herein contained; and all proceedings
taken by the Company in connection with the issuance and sale of Notes as herein
contemplated shall be satisfactory in form and substance to the Agents and to
counsel to the Agents.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be terminated
by the applicable Agent or Agents by notice to the Company at any time and any
such termination shall be without liability of any party to any other party
except as provided in Section 10 hereof and except that Sections 8, 9, 11, 14
and 15 hereof shall survive any such termination and remain in full force and
effect.
6. Delivery of and Payment for Notes Sold through an Agent as Agent.
Delivery of Notes sold through an Agent as an agent of the Company
shall be made by the Company to such Agent for the account of any purchaser only
against payment therefor in immediately available funds. If a purchaser shall
fail either to accept delivery of or to make payment for a Note on the date
fixed for settlement, such Agent shall promptly notify the Company and deliver
such Note to the Company and, if such Agent has theretofore paid the Company for
such Note, the Company will promptly return such funds to such Agent. If such
failure has occurred for any reason other than default by such Agent in the
performance of its obligations hereunder, the Company will reimburse such Agent
on an equitable basis for its loss of the use of the funds for the period such
funds were credited to the Company's account.
7. Additional Covenants of the Company.
The Company further covenants and agrees with each Agent as follows:
(a) Reaffirmation of Representations and Warranties. Each acceptance by
the Company of an offer for the purchase of Notes (whether to one or more Agents
as principal or through an Agent as agent), and each delivery of Notes (whether
to one or more Agents as principal or through an Agent as agent), shall be
deemed to be an affirmation that the representations and warranties of the
Company herein contained and contained in any certificate theretofore delivered
to the Agents pursuant hereto are true and correct at the time of such
acceptance or sale, as the case may be, and an undertaking that such
representations and warranties will be true and correct at the time of delivery
to such Agent(s) or to the purchaser or its agent, as the case may be, of the
Notes relating to such acceptance or sale, as the case may be, as though made at
and as of each such time (it being understood that such representations and
warranties shall relate to the Registration Statement and Prospectus as amended
and supplemented to each such time).
(b) Subsequent Delivery of Certificates. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for the determination of the
variable terms of the Notes or relating solely to the offering of securities
other than the Notes), (ii) there is filed with the Commission any document
incorporated by reference into the Prospectus (other than any Current Report on
Form 8-K relating exclusively to the issuances of securities other than the
Notes), (iii) (if required in connection with the purchase of Notes from the
Company by one or more Agents as principal) the Company sells Notes to one or
more Agents as principal or (iv) the Company sells Notes in a form not
previously certified to the Agents by the Company, the Company shall furnish or
cause to be furnished to the Agent(s), forthwith a certificate dated the date of
filing with the Commission or the date of effectiveness of such amendment or
supplement, as applicable, or the date of such sale, as the case may be, in form
satisfactory to the Agent(s) to the effect that the statements contained in the
certificate referred to in Section 5(c) hereof which were last furnished to the
Agents are true and correct at the time of the filing or effectiveness of such
amendment or supplement, as applicable, or the time of such sale, as the case
may be, as though made at and as of such time (except that such statements shall
be deemed to relate to the Registration Statement and the Prospectus as amended
and supplemented to such time) or, in lieu of such certificate, a certificate of
the same tenor as the certificate referred to in Section 5(c) hereof, modified
as necessary to relate to the Registration Statement and the
15
<PAGE> 16
Prospectus as amended and supplemented to the time of delivery of such
certificate (it being understood that, in the case of clause (ii) above, any
such certificate shall also include a certification that there has been no
material adverse change in the condition, financial or otherwise, or in the
earnings, business affairs or business prospects of the Company and its
subsidiaries considered as one enterprise since the date of the agreement by
such Agent(s) to purchase Notes from the Company as principal).
(c) Subsequent Delivery of Legal Opinions. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented (other
than by an amendment or supplement providing solely for the determination of the
variable terms of the Notes or relating solely to the offering of securities
other than the Notes), (ii) there is filed with the Commission any document
incorporated by reference into the Prospectus (other than a Current Report on
Form 8-K, unless the Agents shall otherwise specify), (iii) (if required in
connection with the purchase of Notes from the Company by one or more Agents as
principal) the Company sells Notes to one or more Agents as principal or (iv)
the Company sells Notes in a form not previously certified to the Agents by the
Company, the Company shall furnish or cause to be furnished forthwith to the
Agent(s) and to counsel to the Agents the written opinions of Waller Lansden,
Brown & Wood and McCullough & Sherrill, counsel to the Company, or other counsel
satisfactory to the Agent(s), dated the date of filing with the Commission or
the date of effectiveness of such amendment or supplement, as applicable, or the
date of such sale, as the case may be, in form and substance satisfactory to the
Agent(s), of the same tenor as the opinion referred to in Section 5(b)(1)
hereof, but modified, as necessary, to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of delivery of such
opinion or, in lieu of such opinion, counsel last furnishing such opinion to the
Agents shall furnish the Agent(s) with a letter substantially to the effect that
the Agent(s) may rely on such last opinion to the same extent as though it was
dated the date of such letter authorizing reliance (except that statements in
such last opinion shall be deemed to relate to the Registration Statement and
the Prospectus as amended and supplemented to the time of delivery of such
letter authorizing reliance).
(d) Subsequent Delivery of Comfort Letters. Each time that (i) the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information (other than by an amendment or
supplement relating solely to the issuance and/or offering of securities other
than the Notes), (ii) there is filed with the Commission any document
incorporated by reference into the Prospectus which contains additional
financial information or (iii) (if required in connection with the purchase of
Notes from the Company by one or more Agents as principal) the Company sells
Notes to one or more Agents as principal, the Company shall cause Ernst & Young
LLP or such other accounting firm that has audited the consolidated financial
statements and supporting schedules included in or incorporated by reference
into the Registration Statement and the Prospectus forthwith to furnish to the
Agent(s) a letter, dated the date of filing with the Commission or the date of
effectiveness of such amendment or supplement, as applicable, or the date of
such sale, as the case may be, in form satisfactory to the Agent(s), of the same
tenor as the letter referred to in Section 5(d) hereof but modified to relate to
the Registration Statement and Prospectus as amended and supplemented to the
date of such letter.
8. Indemnification.
(a) Indemnification of the Agents. The Company agrees to indemnify and
hold harmless each Agent and each person, if any, who controls such Agent within
the meaning of Section 15 of the 1933 Act or Section 20 of the 1934 Act as
follows:
(i) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, arising out of an untrue statement or
alleged untrue statement of a material fact contained in the
Registration Statement (or any amendment thereto), or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
arising out of an untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus
(or any amendment or supplement thereto), or the omission or alleged
omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
16
<PAGE> 17
(ii) against any and all loss, liability, claim, damage and
expense whatsoever, as incurred, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened,
or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, provided
that (subject to Section 8(d) hereof) any such settlement is effected
with the written consent of the Company; and
(iii) against any and all expense whatsoever, as incurred
(including the fees and disbursements of counsel chosen by such Agent),
reasonably incurred in investigating, preparing or defending against
any litigation, or any investigation or proceeding by any governmental
agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not paid
under subparagraph (i) or (ii) above;
provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by the Agents
expressly for use in the Registration Statement (or any amendment thereto) or
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
(b) Indemnification of Company, Directors and Officers. Each Agent
severally agrees to indemnify and hold harmless the Company, its directors, each
of its officers who signed the Registration Statement and each person, if any,
who controls the Company within the meaning of Section 15 of the 1933 Act or
Section 20 of the 1934 Act against any and all loss, liability, claim, damage
and expense described in the indemnity contained in Section 8(a) hereof, as
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by the Agents expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) Actions Against Parties; Notification. Each indemnified party shall
give notice as promptly as reasonably practicable to each indemnifying party of
any action commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have otherwise than on account of this indemnity
agreement. In the case of parties indemnified pursuant to Section 8(a) hereof,
counsel to the indemnified parties shall be selected by the applicable Agent(s)
and, in the case of parties indemnified pursuant to Section 8(b) hereof, counsel
to the indemnified shall be selected by the Company. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be counsel to the indemnified party. In
no event shall the indemnifying parties be liable for fees and expenses of more
than one counsel (in addition to any local counsel) separate from their own
counsel for all indemnified parties in connection with any one action or
separate but similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent
of the indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 8 or 9 hereof (whether or not the indemnified parties are
actual or potential parties thereto), unless such settlement, compromise or
consent (i) includes an unconditional release of each indemnified party from all
liability arising out of such litigation, investigation, proceeding or claim and
(ii) does not include a statement as to or an admission of fault, culpability or
a failure to act by or on behalf of any indemnified party.
(d) Settlement Without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel, such indemnifying party
agrees that it shall be liable for any settlement of the nature contemplated by
Section 8(a)(ii)
17
<PAGE> 18
effected without its written consent if (i) such settlement is entered into more
than 45 days after receipt by such indemnifying party of the aforesaid request,
(ii) such indemnifying party shall have received notice of the terms of such
settlement at least 30 days prior to such settlement being entered into and
(iii) such indemnifying party shall not have reimbursed such indemnified party
in accordance with such request prior to the date of such settlement.
9. Contribution. If the indemnification provided for in Section 8 hereof
is for any reason unavailable to or insufficient to hold harmless an indemnified
party in respect of any losses, liabilities, claims, damages or expenses
referred to therein, then each indemnifying party shall contribute to the
aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the Company, on the one
hand, and the applicable Agent(s), on the other hand, from the offering of the
Notes that were the subject of the claim for indemnification or (ii) if the
allocation provided by clause (i) 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 applicable Agent(s), on the other hand, in connection with the
statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company, on the one hand, and the
applicable Agent(s), on the other hand, in connection with the offering of the
Notes that were the subject of the claim for indemnification shall be deemed to
be in the same respective proportions as the total net proceeds from the
offering of such Notes (before deducting expenses) received by the Company and
the total discount or commission received by each applicable Agent, as the case
may be, bears to the aggregate initial offering price of such Notes.
The relative fault of the Company, on the one hand, and the applicable
Agent(s), on the other hand, shall be determined by reference to, among other
things, whether any untrue or alleged untrue statement of a material fact or
omission or alleged omission to state a material fact relates to information
supplied by the Company or by the applicable Agent(s) and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Agents agree that it would not be just and
equitable if contribution pursuant to this Section 9 were determined by pro rata
allocation (even if the applicable Agent(s) were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 9. The aggregate
amount of losses, liabilities, claims, damages and expenses incurred by an
indemnified party and referred to above in this Section 9 shall be deemed to
include any legal or other expenses reasonably incurred by such indemnified
party in investigating, preparing or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any applicable untrue or alleged
untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 9, (i) no Agent shall be
required to contribute any amount in excess of the amount by which the total
discount or commission received by such Agent in connection with the offering of
the Notes that were the subject of the claim for indemnification exceeds the
amount of any damages which such Agent has otherwise been required to pay by
reason of any applicable untrue or alleged untrue statement or omission or
alleged omission and (ii) no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the 1933 Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. In addition, in connection with an offering of Notes
purchased from the Company by two or more Agents as principal, the respective
obligations of such Agents to contribute pursuant to this Section 9 are several,
and not joint, in proportion to the aggregate principal amount of Notes that
each such Agent has agreed to purchase from the Company.
For purposes of this Section 9, each person, if any, who controls an
Agent within the meaning of Section 15 of the 1933 Act or Section 20 of the 1934
Act shall have the same rights to contribution as such Agent, and each director
of the Company, each officer of the Company who signs the Registration Statement
and each person, if any, who controls the Company within the meaning of Section
15 of the 1933 Act or Section 20 of the 1934 Act shall have the same rights to
contribution as the Company.
18
<PAGE> 19
10. Payment of Expenses.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(a) The preparation, filing, printing and delivery of the Registration
Statement as originally filed and all amendments thereto and any preliminary
prospectus, the Prospectus and any amendments or supplements thereto;
(b) The preparation, printing and delivery of this Agreement and the
Indenture;
(c) The preparation, issuance and delivery of the Notes, including any
fees and expenses relating to the eligibility and issuance of Notes in
book-entry form and the cost of obtaining CUSIP or other identification numbers
for the Notes;
(d) The fees and disbursements of the Company's accountants, counsel
and other advisors or agents (including any calculation agent or exchange rate
agent) and of the Trustee and its counsel;
(e) The reasonable fees and disbursements of counsel to the Agents
incurred in connection with the establishment of the Program and incurred from
time to time in connection with the transactions contemplated hereby;
(f) The fees charged by nationally recognized statistical rating
organizations for the rating of the Program and the Notes;
(g) The fees and expenses incurred in connection with any listing of
Notes on a securities exchange;
(h) The filing fees incident to, and the reasonable fees and
disbursements of counsel to the Agents in connection with, the review, if any,
by the National Association of Securities Dealers, Inc. (the "NASD"); and
(i) Any advertising and other out-of-pocket expenses of the Agents
incurred with the approval of the Company.
11. Representations, Warranties and Agreements to Survive Delivery.
All representations, warranties and agreements contained in this
Agreement or in certificates of officers of the Company or any of its
subsidiaries submitted pursuant hereto or thereto shall remain operative and in
full force and effect, regardless of any investigation made by or on behalf of
the Agents or any controlling person of an Agent, or by or on behalf of the
Company or any controlling person of the Company, and shall survive each
delivery of and payment for the Notes.
12. Termination.
(a) Termination of this Agreement. This Agreement (excluding any
agreement by one or more Agents to purchase Notes from the Company as principal)
may be terminated for any reason, at any time by either the Company or an Agent,
as to itself, upon the giving of 30 days' prior written notice of such
termination to the other party hereto.
(b) Termination of Agreement to Purchase Notes as Principal. The
applicable Agent(s) may terminate any agreement by such Agent(s) to purchase
Notes from the Company as principal, immediately upon notice to the Company, at
any time prior to the Settlement Date relating thereto, if (i) there has been,
since the date of such agreement or since the respective dates as of which
information is given in the Prospectus, any material adverse change in the
condition, financial or otherwise, or in the earnings, business affairs or
business prospects of the Company and its subsidiaries considered as one
enterprise, whether or not arising in the ordinary course of business, or (ii)
there has occurred any material adverse change in the financial markets in the
United States or, if such Notes are denominated
19
<PAGE> 20
and/or payable in, or indexed to, one or more foreign or composite currencies,
in the international financial markets, or any outbreak of hostilities or
escalation thereof or other calamity or crisis or any change or development or
event involving a prospective change in national or international political,
financial or economic conditions, in each case the effect of which is such as to
make it, in the judgment of such Agent(s), impracticable to market such Notes or
enforce contracts for the sale of such Notes, or (iii) trading in any securities
of the Company has been suspended or limited by the Commission or a national
securities exchange, or if trading generally on the New York Stock Exchange or
the American Stock Exchange or in the Nasdaq National Market has been suspended
or limited, or minimum or maximum prices for trading have been fixed, or maximum
ranges for prices have been required, by either of said exchanges or by such
system or by order of the Commission, the NASD or any other governmental
authority, or (iv) a banking moratorium has been declared by either Federal or
New York authorities or by the relevant authorities in the country or countries
of origin of any foreign or composite currency in which such Notes are
denominated and/or payable, or (v) the rating assigned by any nationally
recognized statistical rating organization to the Program or any debt securities
(including the Notes) of the Company as of the date of such agreement shall have
been lowered or withdrawn since that date or if any such rating organization
shall have publicly announced that it has under surveillance or review its
rating of the Program or any such debt securities, or (vi) there shall have come
to the attention of such Agent(s) any facts that would cause such Agent(s) to
believe that the Prospectus, at the time it was required to be delivered to a
purchaser of such Notes, included an untrue statement of a material fact or
omitted to state a material fact necessary in order to make the statements
therein, in the light of the circumstances existing at the time of such
delivery, not misleading.
(c) General. In the event of any such termination, neither party will
have any liability to the other party hereto, except that (i) the Agents shall
be entitled to any commissions earned in accordance with the third paragraph of
Section 3(b) hereof, (ii) if at the time of termination (a) any Agent shall own
any Notes purchased by it from the Company as principal or (b) an offer to
purchase any of the Notes has been accepted by the Company but the time of
delivery to the purchaser or his agent of such Notes relating thereto has not
occurred, the covenants set forth in Sections 4 and 7 hereof shall remain in
effect until such Notes are so resold or delivered, as the case may be, and
(iii) the covenant set forth in Section 4(i) hereof, the provisions of Section
10 hereof, the indemnity and contribution agreements set forth in Sections 8 and
9 hereof, and the provisions of Sections 11, 14 and 15 hereof shall remain in
effect.
13. Notices.
Unless otherwise provided herein, all notices required under the terms
and provisions hereof shall be in writing, either delivered by hand, by mail,
overnight courier or by telex, telecopier or telegram, and any such notice shall
be effective when received at the address specified below.
If to the Company:
JDN REALTY CORPORATION
3340 Peachtree Road, N.E.
Suite 1530
Atlanta, GA 30326
Attention: William J. Kerley
Telecopy No.: (404) 364-6444
With copies to:
Waller Lansden Dortch & Davis, PLLC
Nashville City Center
511 Union Street, Suite 2100
Nashville, Tennessee 37219-1760
Attention: E. Marlee Mitchell, Esq.
Telecopy No: (615) 244-6804
20
<PAGE> 21
If to the Agents:
<TABLE>
<S> <C>
Merrill Lynch & Co. Morgan Stanley & Co., Incorporated
Merrill Lynch, Pierce, Fenner & Smith 1585 Broadway
Incorporated New York, New York 10036
World Financial Center Attention: Manager, Continuously Offered Products
North Tower - 10th Floor Telecopy No.: (212) 761-2000
New York, New York 10281-1310
Attention: MTN Product Management Smith Barney Inc.
Telecopy No.: (212) 449-2234 388 Greenwich Street
New York, New York 10013
BT Alex. Brown Incorporated Attention: Rob Deckey
130 Liberty Street Telecopy No.: (212) 816-7491
25th Floor
New York, New York 10006
Attention: Jeff Baevsky
Telecopy No.: (212) 669-0764
</TABLE>
With copies to:
Hogan & Hartson, L.L.P.
Columbia Square
555 Thirteenth Street, N.W.
Washington, D.C. 20004-1109
Attention: Steven A. Museles, Esq.
Telecopy No.: (202) 637-5910
or at such other address as such party may designate from time to time by notice
duly given in accordance with the terms of this Section 13.
14. Parties.
This Agreement shall inure to the benefit of and be binding upon the
Agents and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons, officers and directors referred to in
Sections 8 and 9 hereof and their heirs and legal representatives, any legal or
equitable right, remedy or claim under or in respect of this Agreement or any
provision herein contained. This Agreement and all conditions and provisions
hereof are intended to be for the sole and exclusive benefit of the parties
hereto and their respective successors, and said controlling persons, officers
and directors and their heirs and legal representatives, and for the benefit of
no other person, firm or corporation. No purchaser of Notes shall be deemed to
be a successor by reason merely of such purchase.
15. GOVERNING LAW; FORUM.
THIS AGREEMENT AND ALL THE RIGHTS AND OBLIGATIONS OF THE PARTIES SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO CONFLICT OF LAW PRINCIPLES. ANY SUIT, ACTION OR
PROCEEDING BROUGHT BY THE COMPANY AGAINST ANY AGENT IN CONNECTION WITH OR
ARISING UNDER THIS AGREEMENT SHALL BE BROUGHT SOLELY IN THE STATE OR FEDERAL
COURT OF APPROPRIATE JURISDICTION LOCATED IN THE BOROUGH OF MANHATTAN, THE CITY
OF NEW YORK.
16. Effect of Headings.
The Article and Section headings herein are for convenience only and
shall not affect the construction hereof.
17. Counterparts.
This Agreement may be executed in one or more counterparts and, if
executed in more than one counterpart, the executed counterparts hereof shall
constitute a single instrument.
21
<PAGE> 22
If the foregoing is in accordance with the Agents' understanding of our
agreement, please sign and return to the Company a counterpart hereof, whereupon
this Distribution Agreement, along with all counterparts, will become a binding
agreement among the Agents and the Company in accordance with its terms.
Very truly yours,
JDN REALTY CORPORATION
By: /s/ William J. Kerley
-----------------------------
Name: William J. Kerley
Title: Chief Financial Officer
CONFIRMED AND ACCEPTED,
as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Scott Primrose
---------------------------------
Authorized Signatory
BT ALEX. BROWN INCORPORATED
By: /s/ Jeff Baevsky
---------------------------------
Authorized Signatory
MORGAN STANLEY & CO. INCORPORATED
By: /s/ Harold Hendershot III
---------------------------------
Authorized Signatory
SMITH BARNEY INC.
By: /s/ Rob Deckey
---------------------------------
Authorized Signatory
<PAGE> 23
SCHEDULE A
As compensation for the services of the Agents hereunder, the Company
shall pay the applicable Agent, on a discount basis, a commission for the sale
of each Note equal to the principal amount of such Note multiplied by the
appropriate percentage set forth below:
<TABLE>
<CAPTION>
MATURITY RANGES PERCENT OF
- --------------- PRINCIPAL AMOUNT
----------------
<S> <C>
From 9 months to less than 1 year..................... .125%
From 1 year to less than 18 months.................... .150
From 18 months to less than 2 years................... .200
From 2 years to less than 3 years..................... .250
From 3 years to less than 4 years..................... .350
From 4 years to less than 5 years..................... .450
From 5 years to less than 6 years..................... .500
From 6 years to less than 7 years..................... .550
From 7 years to less than 10 years.................... .600
From 10 years to less than 15 years................... .625
From 15 years to less than 20 years................... .700
From 20 years to 30 years............................. .750
Greater than 30 years................................. (1)
</TABLE>
- --------------------
(1) As agreed to by the Company and the applicable Agent at the time of sale.
<PAGE> 24
EXHIBIT A
PRICING TERMS
Principal Amount: $_______
(or principal amount of foreign or composite currency)
Interest Rate or Formula:
If Fixed Rate Note,
Interest Rate:
Interest Payment Dates:
If Floating Rate Note,
Interest Rate Basis(es):
If LIBOR,
o LIBOR Reuters Page:
o LIBOR Telerate Page:
Designated LIBOR Currency:
If CMT Rate,
Designated CMT Telerate Page:
If Telerate Page 7052:
o Weekly Average
o Monthly Average
Designated CMT Maturity Index:
Index Maturity:
Spread and/or Spread Multiplier, if any:
Initial Interest Rate, if any:
Initial Interest Reset Date:
Interest Reset Dates:
Interest Payment Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Fixed Rate Commencement Date, if any:
Fixed Interest Rate, if any:
Day Count Convention:
Calculation Agent:
Redemption Provisions:
Initial Redemption Date:
Initial Redemption Percentage:
Annual Redemption Percentage Reduction, if any:
Repayment Provisions:
Optional Repayment Date(s):
Original Issue Date:
Stated Maturity Date:
Specified Currency:
Exchange Rate Agent:
Authorized Denomination:
Purchase Price: ___%, plus accrued interest, if any, from ___________
Price to Public: ___%, plus accrued interest, if any, from __________
Issue Price:
Settlement Date and Time:
Additional/Other Terms:
Also, in connection with the purchase of Notes from the Company by one or more
Agents as principal, agreement as to whether the following will be required:
Officers' Certificate pursuant to Section 7(b) of the Distribution
Agreement. Legal Opinion pursuant to Section 7(c) of the Distribution
Agreement. Comfort Letter pursuant to Section 7(d) of the Distribution
Agreement.
A-1
<PAGE> 25
EXHIBIT B
FORM OF OPINION OF COMPANY'S COUNSEL
TO BE DELIVERED PURSUANT TO SECTION 5(b)
(1) The Company has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Maryland.
(2) The Company has corporate power and authority to own, lease and
operate its properties and to conduct its business as described in or
incorporated by reference into the Prospectus and to enter into and perform its
obligations under, or as contemplated under, the Distribution Agreement and
consummate the transactions contemplated in the Prospectus.
(3) The Company is duly qualified as a foreign corporation to transact
business and is in good standing in each jurisdiction in which such
qualification is required, whether by reason of the ownership or leasing of
property or the conduct of business, except where the failure to so qualify or
be in good standing would not result in a Material Adverse Effect.
(4) All of the issued and outstanding shares of capital stock of the
Company have been duly authorized and are validly issued, fully paid and
non-assessable; and none of the outstanding shares of capital stock of the
Company were issued in violation of preemptive or other similar rights of any
securityholder of the Company.
(5) Each Significant Subsidiary has been duly incorporated or formed
and is validly existing as a corporation or limited partnership in good standing
under the laws of the jurisdiction of its incorporation or formation, has
corporate or partnership power and authority to own, lease and operate its
properties and to conduct its business as described in or incorporated by
reference into the Prospectus and is duly qualified as a foreign corporation or
limited partnership to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of the
ownership or leasing of property or the conduct of business, except where the
failure to so qualify or be in good standing would not result in a Material
Adverse Effect. Except as otherwise stated in the Registration Statement and the
Prospectus, all of the issued and outstanding equity securities of each
Significant Subsidiary have been duly authorized and are validly issued, fully
paid and non-assessable and, to the best of our knowledge, are owned by the
Company, directly or through subsidiaries (except in the case of JDN Development
Company, Inc., the outstanding voting stock of which is owned 99% by J. Donald
Nichols and 1% by the Company, and the outstanding non-voting stock of which is
owned 100% by the Company), free and clear of any security interest, mortgage,
pledge, lien, encumbrance, claim or equity. None of the outstanding equity
securities of any Significant Subsidiary were issued in violation of preemptive
or other similar rights of any securityholder of such Significant Subsidiary.
(6) The Distribution Agreement has been duly authorized, executed and
delivered by the Company.
(7) The Indenture has been duly authorized, executed and delivered by
the Company and (assuming due authorization, execution and delivery thereof by
the applicable Trustee) constitutes a valid and legally binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as
the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditors' rights generally or by general equitable principles.
(8) The Notes have been duly authorized by the Company for issuance and
sale pursuant to the Distribution Agreement and, when issued and authenticated
in the manner provided for in the Indenture and delivered against payment of the
consideration therefor, will constitute valid and legally binding obligations of
the Company, enforceable against the Company in accordance with their terms,
except as the enforcement thereof may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to or affecting
creditors' rights generally or by general equitable principles, and except
further as enforcement thereof may be limited by (A) requirements that a claim
with respect to any Notes denominated other than in U.S. dollars (or a foreign
or composite currency judgment in respect of such claim) be converted into U.S.
dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law or (B) governmental authority to limit, delay
B-1
<PAGE> 26
or prohibit the making of payments outside the United States. The Notes are in
the form contemplated by, and each registered holder thereof is entitled to the
benefits of, the Indenture.
(9) The Indenture and the Notes conform in all material respects to
the statements relating thereto contained in the Prospectus and are in
substantially the form filed or incorporated by reference, as the case may be,
as an exhibit to the Registration Statement.
(10) The information in the Prospectus under "Description of Debt
Securities," "Description of Notes," "Special Provisions Relating to Foreign
Currency Notes" and "Certain Federal Income Tax Considerations," or any caption
purporting to cover such matters and the information in the Registration
Statement under Item 15, to the extent that such information constitutes matters
of law, summaries of legal matters, the Company's charter and bylaws or legal
proceedings, or legal conclusions, has been reviewed by us and is correct in all
material respects.
(11) To the best of our knowledge, neither the Company nor any of its
subsidiaries is in violation of its charter, bylaws or limited partnership
agreement, and no default by the Company or any of its subsidiaries exists in
the due performance or observance of any material obligation, agreement,
covenant or condition contained in any contract, indenture, mortgage, loan
agreement, note, lease or other agreement or instrument that is described or
referred to in the Registration Statement or the Prospectus or filed or
incorporated by reference as an exhibit to the Registration Statement.
(12) The execution, delivery and performance of the Distribution
Agreement, the Indenture and the Notes and any other agreement or instrument
entered into or issued or to be entered into or issued by the Company in
connection with the transactions contemplated in the Registration Statement and
the Prospectus, and the consummation of the transactions contemplated in the
Registration Statement, Distribution Agreement and the Prospectus (including the
issuance and sale of the Notes and the use of the proceeds therefrom as
described in the Prospectus) and the compliance by the Company with its
obligations thereunder have been duly authorized by all necessary corporate
action and do not and will not, whether with or without the giving of notice or
passage of time or both, conflict with or constitute a breach of, or default or
Repayment Event under, or result in the creation or imposition of any lien,
charge or encumbrance upon any property or assets of the Company or any of its
subsidiaries pursuant to any contract, indenture, mortgage, loan agreement,
note, lease or other agreement or instrument known to us nor will such action
result in any violation of the provisions of the charter, or bylaws of the
Company or any of its subsidiaries or any applicable law, statute, rule,
regulation, judgment, order, writ or decree, known to us, of any government,
government instrumentality or court, domestic or foreign, having jurisdiction
over the Company or any of its subsidiaries or any of their assets, properties
or operations.
(13) To the best of our knowledge, there is not pending or threatened
any action, suit, proceeding, inquiry or investigation to which the Company or
any of its subsidiaries thereof is a party or to which the assets, properties or
operations of the Company or any of its subsidiaries thereof is subject, before
or any court or governmental agency or body, domestic or foreign, which might
reasonably be expected to result in a Material Adverse Effect or which might
reasonably be expected to materially and adversely affect the assets, properties
or operations of the Company or any of its subsidiaries, the performance by the
Company of its obligations under the Distribution Agreement, the Indenture or
the Notes or the consummation of the transactions contemplated under the
Distribution Agreement, the Indenture and the Notes or the performance by the
Company of its obligations thereunder.
(14) All descriptions in the Prospectus of contracts and other
documents to which the Company or any of its subsidiaries are a party are
accurate in all material respects; and, to the best of our knowledge, there are
no franchises, contracts, indentures, mortgages, loan agreements, notes, leases
or other instruments required to be described or referred to in the Registration
Statement or to be filed as exhibits thereto other than those described or
referred to therein or filed or incorporated by reference as exhibits thereto,
and the descriptions thereof or references thereto are correct in all material
respects.
(15) To the best of our knowledge, there are no statutes or regulations
that are required to be described in the Prospectus that are not described as
required.
(16) The Registration Statement has been declared effective under the
1933 Act. Any required filing of the Prospectus pursuant to Rule 424(b) has been
made in the manner and within the time period required by Rule 424(b). To the
best of our knowledge, no stop order suspending the effectiveness of the
Registration Statement has
B-2
<PAGE> 27
been issued under the 1933 Act and no proceedings for that purpose have been
initiated or are pending or threatened by the Commission.
(17) The Registration Statement and the Prospectus, excluding the
documents incorporated by reference therein, and each amendment or supplement to
the Registration Statement and Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (other
than the financial statements and supporting schedules included therein or
omitted therefrom and each Trustee's Statement of Eligibility on Form T-1 (the
"Form T-1s"), as to which we express no opinion), complied as to form in all
material respects with the requirements of the 1933 Act, the 1939 Act and the
1933 Act Regulations.
(18) The documents incorporated by reference in the Prospectus (other
than the financial statements and supporting schedules included therein or
omitted therefrom, as to which we express no opinion), when they became
effective or were filed with the Commission, as the case may be, complied as to
form in all material respects with the requirements of the 1934 Act and the 1934
Act Regulations.
(19) The Company is not, and upon the issuance and sale of the Notes
and the application of the net proceeds therefrom as described in the Prospectus
will not be, an "investment company" within the meaning of the 1940 Act.
(20) The Notes, in the forms certified on the date hereof, will be
excluded or exempted under, or beyond the purview of, the Commodity Exchange Act
and the Commodity Exchange Act Regulations.
(21) No filing with, or authorization, approval, consent, license,
order, registration, qualification or decree of, any court or governmental
authority or agency, domestic or foreign, is necessary or required for the
performance by the Company of its obligations under the Distribution Agreement,
the Indenture or the Notes or in connection with the transactions contemplated
thereby other than under the 1933 Act, the 1933 Act Regulations, the 1939 Act
and the 1939 Act Regulations, which have been made (or as may be required under
state securities or blue sky laws or by the NASD, as to which we express no
opinion).
(22) Based on certain customary assumptions and representations
(acceptable to counsel for the Agents in their reasonable discretion) relating
to applicable asset composition, source of income, shareholder diversification
distribution, recordkeeping tests and other requirements of the Code necessary
for the Company to qualify as a real estate investment trust ("REIT"), the
Company was organized and has operated in conformity with the requirements for
qualification and taxation as a REIT under Sections 856 through 860 of the Code
for each of the taxable years ended December 31, 1994, December 31, 1995,
December 31, 1996 and December 31, 1997, and the Company's current organization
and method of operations will enable the Company to continue to qualify as a
REIT under the Code. The discussion in the Prospectus under the caption "Certain
United States Federal Income Tax Considerations" and the discussion incorporated
by reference from the 8-K dated January 26, 1998 under the caption "Federal
Income Tax and ERISA Considerations" fairly summarize the federal income tax
considerations that are likely to be material to a holder of Notes and, to the
extent that it constitutes matters of law or legal conclusions, has been
reviewed by such counsel, is correct and presents fairly the information
required to be disclosed therein.
Nothing has come to our attention that would lead us to believe that
the Registration Statement or any post-effective amendment thereto (except for
consolidated financial statements and schedules and other financial data
included therein or omitted therefrom and for the Form T-1s, as to which we make
no statement), at the time the Registration Statement or any post-effective
amendment thereto (including the filing of the Company's Annual Report on Form
10-K with the Commission) became effective or at the date of any agreement of
the applicable Agent(s) to purchase Notes from the Company as principal,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading or that the Prospectus or any amendment or supplement thereto
(except for consolidated financial statements and schedules and other financial
data included therein or omitted therefrom, as to which we make no statement),
at the time the Prospectus was issued, at the time any such amended or
supplemented prospectus was issued or at the date hereof, included or includes
an untrue statement of a material fact or omitted or omits to state a material
fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
In rendering such opinion, we may rely as to matters of fact (but not
as to legal conclusions), to the extent they deem proper, on certificates of
responsible officers of the Company and public officials.
B-3
<PAGE> 28
February 5, 1998
JDN Realty Corporation
3340 Peachtree Road NE
Suite 1530
Atlanta, GA 30326
Ladies and Gentlemen:
The undersigned understand that JDN Realty Corporation (the "Company") has
not yet been able to obtain a rating of its proposed offering of up to
$505,500,000 of Medium-Term Notes (the "Notes") Due Nine Months or More from
Date of Issue (the "Program") from Moody's Ratings Service ("Moody's") and the
Company is using its best effort to obtain such rating no later than the
earlier of 10 business days from the date hereof or the date of the first
offering of Notes under the Program. Therefore, in connection with the closing
of the Program to be held today under the Distribution Agreement (the
"Distribution Agreement"), dated as of the date hereof, by and among the
Company and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated, BT Alex. Brown Incorporated, Salomon Brothers Inc and Morgan
Stanley & Co. Incorporated, the undersigned do hereby waive the requirement
that the Company shall have obtained a rating from Moody's prior to the date
hereof; provided, however, that no offerings shall be made under the Program
until such time as the rating for the Program from Moody's has been received in
accordance with Section 2(a)(31) of the Distribution Agreement.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Scott Primrose
---------------------------------
Authorized Signatory
<PAGE> 29
JDN Realty Corporation
February 5, 1998
Page 2
BT ALEX. BROWN INCORPORATED
By: /s/ Robert Blumenthal
-----------------------------
Authorized Signatory
MORGAN STANLEY & CO. INCORPORATED
By: /s/ Harold Hendershot III
-----------------------------
Authorized Signatory
SALOMON BROTHERS INC
By: /s/ Robert Deckey
-----------------------------
Authorized Signatory
ACCEPTED AND AGREED TO AS OF
THE DATE ABOVE WRITTEN:
JDN REALTY CORPORATION
By: J. Donald Nichols
------------------------
Name: J. Donald Nichols
Title: Chairman and CEO
<PAGE> 30
ADDENDUM
For purposes of the document attached hereto and all other documents,
certificates, agreements and instruments executed in connection with the
closing of the JDN Realty Corporation Medium-Term Notes Program on the date
hereof, all references to Smith Barney Inc. shall be deemed to refer to Salomon
Brothers Inc.
IN WITNESS WHEREOF, the undersigned have executed the addendum
("Addendum") as of February 5, 1998.
This Addendum may be executed in one or more counterparts and, if executed
in more than one counterpart, the executed counterparts hereof shall constitute
a single instrument.
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
By: /s/ Scott Primrose
----------------------------------
Authorized Signatory
BT ALEX. BROWN INCORPORATED
By: /s/ Robert Blumenthal
----------------------------------
Authorized Signatory
MORGAN STANLEY & CO. INCORPORATED
By: /s/ Harold Hendershot III
----------------------------------
Authorized Signatory
SALOMON BROTHERS INC
By: /s/ Robert Deckey
----------------------------------
Authorized Signatory
<PAGE> 31
ACCEPTED AND AGREED TO AS OF
THE DATE ABOVE WRITTEN:
JDN REALTY CORPORATION
By: /s/ J. Donald Nichols
----------------------------------
Name: J. Donald Nichols
Title: Chairman and CEO
<PAGE> 1
EXHIBIT 4.1
JDN REALTY CORPORATION
AND
First Union National Bank
as Trustee
-------------------
Second Supplemental Indenture
Dated as of February 5, 1998
-------------------
Supplement to Indenture dated as of July 15, 1997
<PAGE> 2
SECOND SUPPLEMENTAL INDENTURE
SECOND SUPPLEMENTAL INDENTURE, dated as of February __ 1998, between
JDN Realty Corporation, a Maryland corporation (hereinafter called the
"Company"), having its principal office at 3340 Peachtree Road, Suite 1530,
Atlanta, Georgia 30326, and First Union National Bank, a national banking
association organized under the laws of the United States of America (hereafter
called the "Trustee"), having a Corporate Trust Office at 11th Floor, 999
Peachtree Street, N.E., Atlanta, Georgia 30309-9094, as Trustee under the
Indenture (as hereinafter defined).
RECITALS
WHEREAS, the Company and the Trustee have as of July 15, 1997 entered
into an Indenture, (hereinafter called the "Indenture") providing for the
issuance by the Company from time to time of its senior debt securities
evidencing its unsecured and unsubordinated indebtedness (the "Securities");
WHEREAS, $75,000,000 aggregate principal amount of 6.80% Notes due 2004
and $85,000,000 aggregate principal amount of 6.95% Notes due 2007 have been
issued under the Indenture;
WHEREAS, the Company desires to issue a new series of senior debt
securities under the Indenture, the "Notes" (as defined below), and has duly
authorized the creation of the Notes and the execution and delivery of this
Second Supplemental Indenture to modify the Indenture and provide certain
additional provisions as hereinafter described; and
WHEREAS, the Company and the Trustee deem it advisable to enter into
this Second Supplemental Indenture for the purposes of providing for the rights,
obligations and duties of the Trustee with respect to the Notes and to set forth
certain specific provisions with respect thereto;
NOW, THEREFORE, THIS SECOND SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, the Company and the Trustee
covenant and agree, for the equal and proportionate benefit of all Holders of
the Notes, as follows:
ARTICLE ONE
CREATION OF THE NOTES
Section 1.01. Pursuant to the terms hereof and the Indenture, the
Company hereby creates a series of its Notes known as the "Medium-Term Notes
<PAGE> 3
Due Nine Months or More From Date of Issue," which series of Notes shall be
deemed Securities for all purposes of the Indenture.
Section 1.02. The definitive form of the Notes shall be substantially
in the form set forth in Exhibit A or Exhibit B, as applicable, attached hereto,
which are incorporated herein and made part hereof. The Notes shall bear
interest, be payable and have such other terms as are stated in the form of
definitive Note or in the Indenture, as supplemented by this Second Supplemental
Indenture.
Section 1.03. The Notes shall not exceed $505,500,000 in aggregate
principal amount, and may, upon the execution and delivery of this Second
Supplemental Indenture or from time to time thereafter, be executed by the
Company and delivered to the Trustee for authentication, and the Trustee shall
thereupon authenticate and deliver said Notes to or upon the written order of
the Company, signed by its Chairman, President or a Vice President and by its
Treasurer or an Assistant Treasurer or its Secretary or an Assistant Secretary,
without further action by the Company.
Section 1.04. The Trustee's certificate of authentication to be borne
by the Notes shall be substantially of the tenor and purport as provided in the
Indenture.
ARTICLE TWO
APPOINTMENT OF THE TRUSTEE FOR THE NOTES
Section 2.01. Pursuant and subject to the Indenture, the Company and
the Trustee hereby constitute the Trustee as trustee to act on behalf of the
Holders of the Notes, effective upon execution and delivery of this Second
Supplemental Indenture. By execution, acknowledgment and delivery of this Second
Supplemental Indenture, the Trustee hereby accepts appointment as trustee with
respect to the Notes, and agrees to perform such trusts upon the terms and
conditions in the Indenture and in this Second Supplemental Indenture set forth.
Section 2.02. Any rights, powers, duties and obligations by any
provisions of the Indenture conferred or imposed upon the Trustee shall, insofar
as permitted by law, be conferred or imposed upon and exercised or performed by
the Trustee with respect to the Notes.
ARTICLE THREE
DEFINITIONS
Pursuant to Section 301(25) of the Indenture, so long as any of the
Notes are Outstanding, the following definitions shall be applicable to the
Notes, be included as defined as terms for all purpose of the Indenture and, to
the extent
-2-
<PAGE> 4
inconsistent with the definition of such term contained in Section 101 of the
Indenture, shall replace such definition:
"Acquired Debt" means Debt of a Person (i) existing at the time such
Person becomes a Subsidiary or (ii) assumed in connection with the acquisition
of assets from such Person, in each case, other than Debt incurred in connection
with, or in contemplation of, such Person becoming a Subsidiary or such
acquisition. Acquired Debt shall be deemed to be incurred on the date of the
related acquisition of assets from any Person or the date the acquired Person
becomes a Subsidiary.
"Annual Debt Service Charge" as of any date means the amount which is
expensed in any 12-month period for interest on Debt of the Company and its
Subsidiaries in accordance with GAAP.
"Consolidated Income Available for Debt Service" for any period means
Consolidated Net Income plus amounts which have been deducted in determining
Consolidated Net Income during such period for (i) Consolidated Interest
Expense, (ii) provision for taxes of the Company and its Subsidiaries based on
income, (iii) amortization (other than amortization of debt discount) and
depreciation, (iv) provisions for losses from sales or joint ventures, (v)
increases in deferred taxes and other non-cash items, (vi) charges resulting
from a change in accounting principles, and (vii) charges for early
extinguishment of debt, and less amounts which have been added in determining
Consolidated Net Income during such period for (a) provisions for gains from
sales or joint ventures, and (b) decreases in deferred taxes and other non-cash
items.
"Consolidated Interest Expense" means, for any period, and without
duplication, all interest (including the interest component of rentals on
capitalized leases, letter of credit fees, commitment fees and other like
financial charges) and all amortization of debt discount on all Debt (including,
without limitation, payment-in-kind, zero coupon and other like securities) of
the Company and its Subsidiaries, but excluding legal fees, title insurance
charges and other out-of-pocket fees and expenses incurred in connection with
the issuance of Debt, all determined in accordance with GAAP.
"Consolidated Net Income" for any period means the amount of net income
(or loss) of the Company and its Subsidiaries for such period determined in
accordance with GAAP after eliminating intercompany accounts and transactions.
"Debt" of the Company or any of its Subsidiaries means any indebtedness
of the Company or any of its Subsidiaries, whether or not contingent, and
without duplication, in respect of (i) borrowed money evidenced by bonds, notes,
debentures or similar instruments, (ii) indebtedness secured by any mortgage,
pledge, lien, charge, encumbrance or any security interest existing on property
owned by the Company or any of its Subsidiaries, (iii) the reimbursement
-3-
<PAGE> 5
obligations, contingent or otherwise, in connection with any letters of credit
actually issued or amounts representing the balance deferred and unpaid of the
purchase price of any property except any such balance that constitutes an
accrued expense or trade payable or (iv) any lease of property by the Company or
any of its Subsidiaries as lessee which is reflected in the balance sheet of the
Company or any of its Subsidiaries as a capitalized lease in accordance with
GAAP, in the case of items of indebtedness under (i) through (iii) above to the
extent that any such items (other than letters of credit) would appear as a
liability on the balance sheet of the Company or any of its Subsidiaries in
accordance with GAAP, and also includes, to the extent not otherwise included,
any obligation by the Company or any Subsidiary to be liable for, or to pay, as
obligor, guarantor or otherwise (other than for purposes of collection in the
ordinary course of business), indebtedness of another person (other than the
Company or any Subsidiary) (it being understood that Debt shall be deemed to be
incurred by the Company or any of its Subsidiaries whenever the Company or any
of its Subsidiaries shall create, assume, guarantee or otherwise become liable
in respect thereof). As used herein "intercompany Debt" shall the meaning
ascribed hereto in section 5.01.
"Notes" means the Company's Medium-Term Notes Due Nine Months or More
From Date of Issue.
"Recourse Indebtedness" means Debt other than Secured Debt as to which
the liability of the obligor thereon is limited to its interest in the
collateral securing such Secured Debt, provided that no such Secured Debt shall
constitute Recourse Indebtedness by reason of provisions therein for imposition
of full recourse liability on the obligor for certain wrongful acts,
environmental liabilities, or other customary exclusions from the scope of
so-called "non-recourse" provisions.
"Secured Debt" means Debt secured by any mortgage, trust deed, deed of
trust, deed to secure debt, security agreement, pledge, conditional sale or
other title retention agreement, capitalized lease, or other like agreement
granting or conveying security title to or a security interest in real property
or other tangible assets, other than those relating to intercompany Debt. For
purposes hereof, such Debt shall become Secured Debt at the time it first
becomes secured by execution of any of the documents, instruments or agreements
described in the immediately preceding sentence.
"Senior Executive Group" shall mean, collectively, those individuals
holding the offices of Chairman, President, Chief Executive Officer, Chief
Financial Officer or any Vice President of the Company.
"Subsidiary" means (i) any corporation or other entity the majority of
the shares of the non-voting capital stock or other equivalent ownership
interests of which (except directors' qualifying shares) are at the time
directly or indirectly owned by the Company, and the majority of the shares of
the voting capital stock or
-4-
<PAGE> 6
other equivalent ownership interests of which (except directors' qualifying
shares) are at the time directly or indirectly owned by the Company, any other
Subsidiary, and/or one or more individuals of the Senior Executive Group (or, in
the event of death or disability of any of such individuals, his/her respective
legal representative(s)), or such individuals' successors in office as an
officer of the Company or the Secretary of such Subsidiary, and (ii) any other
entity (other than the Company) the accounts of which are consolidated with the
accounts of the Company or any Subsidiary.
"Total Assets" as of any date means the sum of (i) Undepreciated Real
Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined in accordance with GAAP (but excluding intangibles and accounts
receivable) after eliminating intercompany accounts and transactions.
"Total Unencumbered Assets" as of any date means the sum of (i) those
Undepreciated Real Estate Assets not securing any portion of Secured Debt and
(ii) all other assets of the Company and its Subsidiaries not securing any
portion of Secured Debt determined in accordance with GAAP (but excluding
accounts receivable and intangibles) after eliminating intercompany accounts and
transactions.
"Undepreciated Real Estate Assets" as of any date means the cost
(original cost plus capital improvements) of real estate assets of the Company
and its Subsidiaries on such date, before depreciation and amortization,
determined in accordance with GAAP.
"Unsecured Debt" means Debt of the Company or any Subsidiary that is
not Secured Debt, excluding intercompany Debt.
ARTICLE FOUR
EVENTS OF DEFAULT
Pursuant to Section 501 of the Indenture, so long as any of the Notes
are Outstanding, the following event shall replace Section 501(5) of the
Indenture as an Event of Default with respect to any series of the Notes:
A default under any evidence of Recourse Indebtedness of the Company,
or under any bond, debenture, note, mortgage, indenture or other instrument of
the Company (including a default with respect to Securities of any series other
than such series) under which there may be issued or by which there may be
secured any Recourse Indebtedness of the Company (or by any Subsidiary, the
repayment of which the Company has guaranteed or for which the Company is
directly responsible or liable as obligor or guarantor), whether such
indebtedness now exists or shall hereafter be created, which default shall
constitute a failure to
-5-
<PAGE> 7
pay an aggregate principal amount exceeding $5,000,000 of such indebtedness when
due and payable after the expiration of any applicable grace period with respect
thereto and shall have resulted in such indebtedness, in an aggregate principal
amount exceeding $5,000,000, becoming or being declared due and payable prior to
the date on which it would otherwise have become due or payable, without such
indebtedness having been discharged, or such acceleration having being rescinded
or annulled, within a period of 10 days after there shall have been given, by
registered or certified mail, to the Company by the Trustee, or to the Company
and the Trustee by the Holders of at least 10% in principal amount of the
Outstanding Securities of such series, a written notice specifying such default
and requiring the Company to cause such indebtedness to be discharged or cause
such acceleration to be rescinded or annulled and stating that such notice is a
"Notice of Default" hereunder.
ARTICLE FIVE
COVENANTS OF THE COMPANY
Pursuant to Section 301(15) of the Indenture, so long as any of the
Notes are Outstanding, the Company covenants and agrees as follows:
Section 5.01. Limitation on Incurrence of Total Debt. The Company will
not, and will not permit a Subsidiary to, incur any Debt, other than
intercompany Debt (representing Debt to which the only parties are the Company
and any of its Subsidiaries, but only so long as such Debt is held solely by the
Company and any Subsidiary) if, after giving effect to the incurrence of such
additional Debt, the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries determined in accordance with GAAP is greater than
60% of (i) Total Assets of the Company and its Subsidiaries as of the end of the
fiscal quarter covered in the Company's Annual Report on Form 10-K or Quarterly
Report on Form 10-Q, as the case may be, most recently filed with the Securities
and Exchange Commission (or, if such filing is not permitted under the
Securities and Exchange Act of 1934, with the Trustee) prior to the incurrence
of such additional Debt plus (ii) the increase, if any, in the Total Assets of
the Company and its Subsidiaries from the end of such quarter, including,
without limitation, any increase in Total Assets resulting from the incurrence
of such additional Debt minus (iii) the decrease, if any, in the Total Assets of
the Company and its Subsidiaries from the end of such quarter (the Total Assets
of the Company and its Subsidiaries as so adjusted is referred to as the
"Adjusted Total Assets").
Section 5.02. Limitation on Incurrence of Secured Debt. The Company
will not, and will not permit any Subsidiary to, incur any Secured Debt of the
Company or any Subsidiary other than intercompany Debt, if, after giving effect
to the incurrence of such additional Secured Debt, the aggregate principal
amount of
-6-
<PAGE> 8
all outstanding Secured Debt of the Company and its Subsidiaries is greater than
40% of the Adjusted Total Assets of the Company and its Subsidiaries.
Section 5.03. Debt Service Coverage. The Company will not, and will not
permit any Subsidiary to, incur any Debt other than intercompany Debt if the
ratio of Consolidated Income Available for Debt Service to the Annual Debt
Service Charge for the period consisting of the four consecutive fiscal quarters
(for which financial statements are available) most recently ended prior to the
date on which such additional Debt is to be incurred shall have been less than
1.5 to 1, on a pro forma basis after giving effect to the incurrence of such
Debt and to the application of the proceeds thereof, and calculated on the
assumption that (i) such Debt and any other Debt incurred by the Company or its
Subsidiaries since the first day of such four-quarter period and the application
of the proceeds thereof, including to refinance other Debt, had occurred at the
beginning of such period, (ii) the repayment or retirement of any other Debt by
the Company or its Subsidiaries since the first day of such four-quarter period
had been repaid or retired at the beginning of such period (except that, in
making such computation, the amount of Debt under any revolving credit facility
shall be computed based upon the average daily balance of such Debt during such
period), (iii) in the case of Acquired Debt or Debt in connection with any
acquisition since the first day of such four-quarter period, the related
acquisition had occurred as of the first day of such period with the appropriate
adjustments with respect to the acquisition being included in the pro forma
calculation and (iv) in the case of any increase or decrease in Total Assets of
the Company and its Subsidiaries, or any other acquisition or disposition by the
Company or any Subsidiary of any asset or group of assets, since the first day
of such four-quarter period, including, without limitation, by merger, stock
purchase or sale, or asset purchase or sale, such increase, decrease or other
acquisition or disposition or any related repayment of Debt had occurred as of
the first day of such period with the appropriate adjustments to revenues,
expenses and Debt levels with respect to such increase, decrease or other
acquisition or disposition being included in such pro forma calculation.
Section 5.04. Maintenance of Total Unencumbered Assets. The Company and
its Subsidiaries are required to maintain Total Unencumbered Assets of not less
than 150% of the aggregate outstanding principal amount of the Unsecured Debt of
the Company and its Subsidiaries.
ARTICLE SIX
MISCELLANEOUS
Section 6.01. Each and every term and condition contained in the
Indenture shall apply to this Second Supplemental Indenture with the same force
and effect as if the same were herein set forth in full, with such omissions,
variations and modifications thereof as may be appropriate to make the same
-7-
<PAGE> 9
conform to this Second Supplemental Indenture. As supplemented by this Second
Supplemental Indenture, the Indenture shall be read, taken and construed as one
and the same instrument; provided, however, that the rights, duties and
obligations of the Trustee in this Second Supplemental Indenture shall be
limited to those matters expressly relating to the Notes.
Section 6.02. Nothing contained in this Second Supplemental Indenture
shall or shall be construed to confer upon any person other than a Holder the
Notes, the Company and the Trustee any right or interest to avail itself or
himself, as the case may be, of any benefit under any provision of the Indenture
or this Second Supplemental Indenture.
Section 6.03. All capitalized terms which are used herein and not
otherwise defined herein are defined in the Indenture and are used herein with
the same meanings as Indenture.
Section 6.04. This Second Supplemental Indenture shall be effective as
of the date first above written and upon the execution and delivery hereof by
each of the parties hereto.
Section 6.05. This Second Supplemental Indenture shall be governed by,
and construed in accordance with, the laws of the State of New York.
Section 6.06. This Second Supplemental Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
Section 6.07. This Second Supplemental Indenture shall cease to be of
further effect upon compliance with Section 401 of the Indenture with respect to
the Notes created hereby.
-8-
<PAGE> 10
IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed by their respective officers hereunto
duly authorized, all as of the day and year first above written.
JDN REALTY CORPORATION
By: /s/ William J. Kerley Dated: February 5, 1998
---------------------------
Name: William J. Kerley
Title: Chief Financial Officer
FIRST UNION NATIONAL BANK
as Trustee
By: /s/ R. Douglas Milner Dated: February 5, 1998
---------------------------
Name: R. Douglas Milner
-------------------------
Title: Vice President
------------------------
Attest:
-9-
<PAGE> 11
ACKNOWLEDGMENT
STATE OF
) ss:
COUNTY OF
On the 4th day of February, 1998, before me personally came
William J. Kerley, to me known, who, being by me duly sworn, did depose and say
that he is the CFO of JDN REALTY CORPORATION, one of the parties described in
and which executed the foregoing instrument, and that he signed his name thereto
by authority of the Board of Directors.
[Notarial Seal]
/s/ Patricia J. Kask
- ------------------------------
Notary Public
Commission Expires
STATE OF GEORGIA
) ss:
COUNTY OF GWINNETT
On the 4th day of February, 1998, before me personally came
R. Douglas Milner, to me known, who, being by me duly sworn, did depose and say
that he/she is a Vice President of First Union National Bank, one of the parties
described in and which executed the foregoing instrument, and that he/she signed
his/her name thereto by authority of the Board of Directors.
[Notarial Seal]
/s/ Brian K. Justice
- ------------------------------
Notary Public
Commission Expires
-10-
<PAGE> 1
EXHIBIT 4.2
EXHIBIT A
[FACE OF NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY
TRUST COMPANY (THE "DEPOSITARY") (55 WATER STREET, NEW YORK, NEW YORK) TO THE
ISSUER HEREOF OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.(1)
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.(2)
REGISTERED REGISTERED
No. FXR-___ PRINCIPAL AMOUNT:
CUSIP No.:
JDN REALTY CORPORATION
MEDIUM-TERM NOTE
(Fixed Rate)
ORIGINAL ISSUE DATE: INTEREST RATE: % STATED MATURITY DATE:
INTEREST PAYMENT DATE(S) DEFAULT RATE: %
[ ] ______ and __________
[ ] Other:
INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION
DATE: PERCENTAGE % PERCENTAGE
REDUCTION: %
OPTIONAL REPAYMENT [ ] CHECK IF AN ORIGINAL
DATE(S): ISSUE DISCOUNT NOTE
Issue Price:
- --------------------
(1) This paragraph applies to global Notes only.
(2) This paragraph applies to global Notes only.
<PAGE> 2
SPECIFIED CURRENCY: AUTHORIZED DENOMINATION: EXCHANGE RATE
[ ] United States Dollars [ ] $1,000 and integral AGENT:
[ ] Other: multiples thereof
[ ] Other:
ADDENDUM ATTACHED OTHER/ADDITIONAL PROVISIONS:
[ ] Yes
[ ] No
A-2
<PAGE> 3
JDN Realty Corporation, a Maryland corporation (the "Issuer,"
which term includes any successor under the Indenture hereinafter referred to),
for value received, hereby promises to pay to ____________________ or its
registered assigns, the principal sum of $__________, on the Stated Maturity
Date specified above (or any Redemption Date or Repayment Date, each as defined
on the reverse hereof) (each such Stated Maturity Date, Redemption Date or
Repayment Date being hereinafter referred to as the "Maturity Date" with respect
to the principal repayable on such date) and to pay interest thereon, at the
Interest Rate per annum specified above, until the principal hereof is paid or
duly made available for payment, and (to the extent that the payment of such
interest shall be legally enforceable) at the Default Rate per annum specified
above on any overdue principal, premium and/or interest. The Issuer will pay
interest in arrears on each Interest Payment Date, if any, specified above
(each, an "Interest Payment Date"), commencing with the first Interest Payment
Date next succeeding the Original Issue Date specified above, and on the
Maturity Date; provided, however, that if the Original Issue Date occurs between
a Record Date (as defined below) and the next succeeding Interest Payment Date,
interest payments will commence on the second Interest Payment Date next
succeeding the Original Issue Date to the holder of this Note on the Record Date
with respect to such second Interest Payment Date. Interest on this Note will be
computed on the basis of a 360-day year of twelve 30-day months.
Interest on this Note will accrue from, and including, the immediately
preceding Interest Payment Date to which interest has been paid or duly provided
for (or from, and including, the Original Issue Date if no interest has been
paid or duly provided for) to, but excluding, the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period"). The
interest so payable, and punctually paid or duly provided for, on any interest
Payment Date will, subject to certain exceptions described herein, be paid to
the person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on the fifteenth calendar day (whether or
not a Business Day, as defined below) immediately preceding such Interest
Payment Date (the "Record Date"); provided, however, that interest payable on
the Maturity Date will be payable to the person to whom the principal hereof and
premium, if any, hereon shall be payable. Any such interest not so punctually
paid or duly provided for ("Defaulted Interest") will forthwith cease to be
payable to the holder on any Record Date, and shall be paid to the person in
whose name this Note is registered at the close of business on a special record
date (the "Special Record Date") for the payment of such Defaulted Interest to
be fixed by the Trustee hereinafter referred to, notice whereof shall be given
to the holder of this Note by the Trustee not less than 10 calendar 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 this Note may be listed, and upon such notice as may be required by such
exchange, all as more fully provided for in the Indenture.
Payment of principal, premium, if any, and interest in respect of this
Note due on the Maturity Date will be made in immediately available funds upon
presentation and surrender of this Note (and, with respect to any applicable
repayment of this Note, a duly completed election form as contemplated on the
reverse hereof) at the corporate trust office of the Trustee maintained for that
purpose in the Borough of Manhattan, The City of New York, currently located at
40 Broad Street, Suite 550, New York, New York 10004 or at such other paying
A-3
<PAGE> 4
agency in the Borough of Manhattan, The City of New York, as the Issuer may
determine; provided, however, that if such payment is to be made in a Specified
Currency other than United States dollars as set forth below, such payment will
be made by wire transfer of immediately available funds to an account with a
bank designated by the holder hereof at least 15 calendar days prior to the
Maturity Date, provided that such bank has appropriate facilities therefor and
that this Note (and, if applicable, a duly completed repayment election form) is
presented and surrendered at the aforementioned office of the Trustee in time
for the Trustee to make such payment in such funds in accordance with its normal
procedures. Payment of interest due on any Interest Payment Date other than the
Maturity Date will be made by check mailed to the address of the person entitled
thereto as such address shall appear in the Security Register maintained at the
aforementioned office of the Trustee; provided, however, that a holder of U.S.
$10,000,000 (or, if the Specified Currency specified above is other than United
States dollars, the equivalent thereof in the Specified Currency) or more in
aggregate principal amount of Notes (whether having identical or different terms
and provisions) will be entitled to receive interest payments on such Interest
Payment Date by wire transfer of immediately available funds if appropriate wire
transfer instructions have been received in writing by the Trustee not less than
15 calendar days prior to such Interest Payment Date. Any such wire transfer
instructions received by the Trustee shall remain in effect until revoked by
such holder.
If any Interest Payment Date or the Maturity Date falls on a day that
is not a Business Day, the required payment of principal, premium, if any,
and/or interest shall be made on the next succeeding Business Day with the same
force and effect as if made on the date such payment was due, and no interest
shall accrue with respect to such payment for the period from and after such
Interest Payment Date or the Maturity Date, as the case may be, to the date of
such payment on the next succeeding Business Day.
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, or other day on which banking institutions are authorized or required by
law, regulation or executive order to close in The City of New York; provided,
however, that if the Specified Currency is other than United States dollars and
any payment is to be made in the Specified Currency in accordance with the
provisions hereof, such day is also not a day on which banking institutions are
authorized or required by law, regulation or executive order to close in the
Principal Financial Center (as defined below) of the country issuing the
Specified Currency (or, in the case of European Currency Units ("ECU"), is not a
day that appears as an ECU non-settlement day on the display designated as
"ISDE" on the Reuter Monitor Money Rates Service (or a day so designated by the
ECU Banking Association) or, if ECU non-settlement days do not appear on that
page (and are not so designated), is not a day on which payments in ECU cannot
be settled in the international interbank market). "Principal Financial Center"
means the capital city of the country issuing the Specified Currency, except
that with respect to United States dollars, Australian dollars, Canadian
dollars, Deutsche marks, Dutch guilders, Italian lire and Swiss francs, the
Principal Financial Center shall be The City of New York, Sydney, Toronto,
Frankfurt, Amsterdam, Milan and Zurich, respectively.
The Issuer is obligated to make payment of principal, premium, if any,
and interest in respect of this Note in the Specified Currency (or, if the
Specified Currency is not at the time of
A-4
<PAGE> 5
such payment legal tender for the payment of public and private debts, in such
other coin or currency of the country which issued the Specified Currency as at
the time of such payment is legal tender for the payment of such debts). If the
Specified Currency is other than United States dollars, any such amounts so
payable by the Issuer will be converted by the Exchange Rate Agent specified
above into United States dollars for payment to the holder of this Note;
provided, however, that the holder of this Note may elect to receive such
amounts in such Specified Currency pursuant to the provisions set forth below.
If the Specified Currency is other than United States dollars and the
holder of this Note shall not have duly made an election to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest
in respect of this Note in the Specified Currency, any United States dollar
amount to be received by the holder of this Note will be based on the highest
bid quotation in The City of New York received by the Exchange Rate Agent at
approximately 11:00 A.M., New York City time, on the second Business Day
preceding the applicable payment date from three recognized foreign exchange
dealers (one of whom may be the Exchange Rate Agent) selected by the Exchange
Rate Agent and approved by the Issuer for the purchase by the quoting dealer of
the Specified Currency for United States dollars for settlement on such payment
date in the aggregate amount of the Specified Currency payable to all holders of
Notes scheduled to receive United States dollar payments and at which the
applicable dealer commits to execute a contract. All currency exchange costs
will be borne by the holder of this Note by deductions from such payments. If
three such bid quotations are not available, payments on this Note will be made
in the Specified Currency.
If the Specified Currency is other than United States dollars, the
holder of this Note may elect to receive all or a specified portion of any
payment of principal, premium, if any, and/or interest in respect of this Note
in the Specified Currency by submitting a written request of such payment to the
Trustee at its corporate trust office in The City of New York on or prior to the
applicable Record Date or at least 15 calendar days prior to the Maturity Date,
as the case may be. Such written request may be mailed or hand delivered or sent
by cable, telex, or other form of facsimile transmission. The holder of this
Note may elect to receive all or a specified portion of all future payments in
the Specified Currency in respect of such principal, premium, if any, and/or
interest and need not file a separate election of each payment. Such election
will remain in effect until revoked by written notice to the Trustee, but
written notice of any such revocation must be received by the Trustee on or
prior to the applicable Record Date or at least 15 calendar days prior to the
Maturity Date, as the case may be.
If the Specified Currency is other than United States dollars or a
composite currency and the holders of this Note shall have duly made an election
to receive all or a specified portion of any payment of principal, premium, if
any, and/or interest in respect of this Note in the Specified Currency and if
the Specified Currency is not available due to the imposition of exchange
controls or other circumstances beyond the control of the Issuer, the Issuer
will be entitled to satisfy its obligations to the holder of this Note by making
such payment in United States dollars on the basis of the Market Exchange Rate
(as defined below) on the second Business Day prior to such payment date or, if
such Market Exchange Rate is not then available, on the basis of the most
recently available Market Exchange Rate or as otherwise specified on the face
hereof. The
A-5
<PAGE> 6
"Market Exchange Rate" for the Specified Currency means the noon dollar buying
rate in The City of New York for cable transfers for the Specified Currency as
certified for customs purposes by (or if not so certified, as otherwise
determined by) the Federal Reserve Bank of New York. Any payment made under such
circumstances in United States dollars will not constitute an Event of Default
(as defined in the Indenture).
If the Specified Currency is a composite currency and the holder of
this Note shall have duly made an election to receive all or a specified portion
of any payment of principal, premium, if any, and/or interest in respect of this
Note in the Specified Currency and if such composite currency is unavailable due
to the imposition of exchange controls or other circumstances beyond the control
of the Issuer, then the Issuer will be entitled to satisfy its obligations to
the holder of this Note by making such payment in United States dollars. The
amount of each payment in United States dollars shall be computed by the
Exchange Rate Agent on the basis of the equivalent of the composite currency in
United States dollars. The component currencies of the composite currency for
this purpose (collectively, the "Component Currencies" and each, a "Component
Currency") shall be the currency amounts that were components of the composite
currency as of the last day on which the composite currency was used. The
equivalent of the composite currency in United States dollars shall be
calculated by aggregating the United States dollar equivalents of the Component
Currencies. The United States dollar equivalent of each of the Component
Currencies shall be determined by the Exchange Rate Agent on the basis of the
most recently available Market Exchange Rate for each such Component Currency,
or as otherwise specified on the face hereof.
If the official unit of any Component Currency is altered by way of
combination or subdivision, the number of units of the currency as a Component
Currency shall be divided or multiplied in the same proportion. If two or more
Component Currencies are consolidated into a single currency, the amounts of
those currencies as Component Currencies shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated Component
Currencies expressed in such single currency. If any Component Currency is
divided into two or more currencies, the amount of the original Component
Currency shall be replaced by the amounts of such two or more currencies, the
sum of which shall be equal to the amount of the original Component Currency.
All determinations referred to above made by the Exchange Rate Agent
shall be at its sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on the holder of this Note.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof and, if so specified above, in the Addendum hereto,
which further provisions shall have the same force and effect as if set forth on
the face hereof.
Notwithstanding any provisions to the contrary contained herein, if the
face of this Note specifies that an Addendum is attached hereto or that
"Other/Additional Provisions" apply, this Note shall be subject to the terms set
forth in such Addendum or such "Other/Additional Provisions."
A-6
<PAGE> 7
Unless the Certificate of Authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, JDN Realty Corporation has caused this Note to be
duly executed.
JDN REALTY CORPORATION,
as Issuer
By:
-------------------------------------
Name:
Title:
Attest:
- ------------------------------
Name:
Title:
[SEAL]
A-7
<PAGE> 8
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated: FIRST UNION NATIONAL BANK, ATLANTA,
------------------------ as Trustee
By:
-------------------------------------
Authorized Signatory
A-8
<PAGE> 9
[REVERSE OF NOTE]
JDN REALTY CORPORATION
MEDIUM-TERM NOTE
(Fixed Rate)
This Note is one of a duly authorized series of Securities (the
"Securities") of the Issuer issued and to be issued under an Indenture, dated as
of July 15, 1997, as amended, modified or supplemented from time to time, (the
"Indenture"), between the Issuer and First Union National Bank, Atlanta, as
Trustee (the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Issuer, 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 Note is one of the series of Securities
designated as "Medium-Term Notes Due Nine Months or More From Date of Issue"
(the "Notes"). All terms used but not defined in this Note specified on the face
hereof or in an Addendum hereto shall have the meanings assigned to such terms
in the Indenture.
This Note is issuable only in registered form without coupons in
minimum denominations of U.S. $1,000 and integral multiples thereof or the
minimum Authorized Denomination specified on the face hereof.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or repayable prior to the Stated Maturity
Date.
This Note will be subject to redemption at the option of the Issuer on
any date on or after the Initial Redemption Date, if any, specified on the face
hereof, in whole or from time to time in part in increments of U.S. $1,000 or
the minimum Authorized Denomination (provided that any remaining principal
amount hereof shall be at least U.S. $1,000 or such minimum Authorized
Denomination), at the Redemption Price (as defined below), together with unpaid
interest accrued thereon to the date fixed for redemption (each, a "Redemption
Date"), on notice given no more than 60 nor less than 30 calendar days prior to
the Redemption Date and in accordance with the provisions of the Indenture. The
"Redemption Price" shall initially be the Initial Redemption Percentage
specified on the face hereof multiplied by the unpaid principal amount of this
Note to be redeemed. The Initial Redemption Percentage shall decline at each
anniversary of the Initial Redemption Date by an amount equal to the Annual
Redemption Percentage Reduction, if any, specified on the face hereof until the
Redemption Price is equal to 100% of the unpaid principal amount to be redeemed.
In the event of redemption of this Note in part only, a new Note of like tenor
for the unredeemed portion hereof and otherwise having the same terms as this
Note shall be issued in the name of the holder hereof upon the presentation and
surrender hereof.
This Note will be subject to repayment by the Issuer at the option of
the holder hereof on the Optional Repayment Date(s), if any, specified on the
face hereof, in whole or in part in increments of U.S. $1,000 or the minimum
Authorized Denomination (provided that any
A-9
<PAGE> 10
remaining principal amount hereof shall be at least U.S. $1,000 or such minimum
Authorized Denomination), at a repayment price equal to 100% of the unpaid
principal amount to be repaid, together with unpaid interest accrued thereon to
the date fixed for repayment (each, a "Repayment Date"). For this Note to be
repaid, this Note must be received, together with the form hereon entitled
"Option to Elect Repayment" duly completed, by the Trustee at its corporate
trust office not more than 60 nor less than 30 calendar days prior to the
Repayment Date. Exercise of such repayment option by the holder hereof will be
irrevocable. In the event of repayment of this Note in part only, a new Note of
like tenor for the unrepaid portion hereof and otherwise having the same terms
as this Note shall be issued in the name of the holder hereof upon the
presentation and surrender hereof.
If this Note is an Original Issue Discount Note as specified on the
face hereof, the amount payable to the holder of this Note in the event of
redemption, repayment or acceleration of maturity will be equal to the sum of
(1) the Issue Price specified on the face hereof (increased by any accruals of
the Discount, as defined below) and, in the event of any redemption of this Note
(if applicable), multiplied by the Initial Redemption Percentage (as adjusted by
the Annual Redemption Percentage Reduction, if applicable) and (2) any unpaid
interest on this Note accrued from the Original Issue Date to the Redemption
Date, Repayment Date or date of acceleration of maturity, as the case may be.
The difference between the Issue Price and 100% of the principal amount of this
Note is referred to herein as the "Discount."
For purposes of determining the amount of Discount that has accrued as
of any Redemption Date, Repayment Date or date of acceleration of maturity of
this Note, such Discount will be accrued so as to cause the yield on the Note to
be constant. The constant yield will be calculated using a 30-day month, 360-day
year convention, a compounding period that, except for the Initial Period (as
defined below), corresponds to the shortest period between Interest Payment
Dates (with ratable accruals within a compounding period) and an assumption that
the maturity of this Note will not be accelerated. If the period from the
Original Issue Date to the initial Interest Payment Date (the "Initial Period")
is shorter than the compounding period for this Note, a proportionate amount of
the yield for an entire compounding period will be accrued. If the Initial
Period is longer than the compounding period, then such period will be divided
into a regular compounding period and a short period, with the short period
being treated as provided in the preceding sentence.
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.
The Indenture contains provisions for defeasance of (i) the entire
indebtedness of the Notes or (ii) certain covenants and Events of Default with
respect to the Notes, in each case upon compliance with certain conditions set
forth therein, which provisions apply to the Notes.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the holders of the Securities at any time by the Issuer
and the Trustee with the consent of the holders
A-10
<PAGE> 11
of not less than a majority of the aggregate principal amount of all Securities
at the time outstanding and affected thereby. The Indenture also contains
provisions permitting the holders of not less than a majority of the aggregate
principal amount of the outstanding Securities of any series, on behalf of the
holders of all such Securities, to waive compliance by the Issuer with certain
provisions of the Indenture. Furthermore, provisions in the Indenture permit the
holders of not less than a majority of the aggregate principal amount of the
outstanding Securities of any series, in certain instances, to waive, on behalf
of all of the holders of Securities of such series, certain past defaults under
the Indenture and their consequences. Any such consent or waiver by the holder
of this Note shall be conclusive and binding upon such holder and upon all
future holders of this Note and other Notes issued upon the registration or
transfer hereof or in exchange heretofore or in lieu hereof, whether or not
notation or such consent or waiver is made upon this Note.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay principal, premium, if any, and interest in
respect of this Note at the times, places and rate or formula, and in the coin
or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
and herein set forth, the transfer of this Note is registrable in the Security
Register of the Issuer upon surrender of this Note for registration of transfer
at the office or agency of the Issuer in any place where the principal hereof
and any premium or interest hereon are payable, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Security Registrar duly executed by, the holder hereof or by his attorney duly
authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein
and herein set forth, this Note is exchangeable for a like aggregate principal
amount of Notes of different authorized denominations but otherwise having the
same terms and conditions, as requested by the holder hereof surrendering the
same.
No service charge shall be made for any such registration of transfer
or exchange, but the Issuer 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 Note for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is registered as the owner thereof for all
purposes, whether or not this Note be overdue, and neither the Issuer, the
Trustee nor any such agent shall be affected by notice to the contrary.
The Indenture and this Note shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such State.
A-11
<PAGE> 12
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenant in common UNIF GIFT MIN ACT - ____ Custodian _____
TEN ENT - as tenants by the entireties (Cust) (minor)
JT TEN - as joint tenants with right under Uniform Gifts to Minors Act
of survivorship and not as
tenants in common ________________
(State)
Additional abbreviations may also be used though not in the above list.
-------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER
IDENTIFYING NUMBER OF ASSIGNEE
______________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
______________________________________________________________ this Note and all
rights thereunder hereby irrevocably constituting and appointing
_________________________________________________ Attorney to transfer this Note
on the books of the Trustee, with full power of substitution in the premises.
Dated:_________________ ____________________________________________
____________________________________________
Notice: The signature(s) on this Assignment
must correspond with the name(s) as written
upon the face of this Note in every
particular, without alteration or
enlargement or any change whatsoever.
A-12
<PAGE> 13
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the
Issuer to repay this Note (or portion hereof specified below) pursuant to its
terms at a price equal to 100% of the principal amount to be repaid, together
with unpaid interest accrued hereon to the Repayment Date, to the undersigned,
at
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its corporate
trust office in the Borough of Manhattan, The City of New York, currently
located at 40 Broad Street, Suite 550, New York, New York 10004 not more than 60
nor less than 30 calendar days prior to the Repayment Date, this Note with this
"Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of U.S. $1,000 (or, if the
Specified Currency is other than United States dollars, the minimum Authorized
Denomination specified on the face hereof), which the holder elects to have
repaid and specify the denomination or denominations (which shall be as
Authorized Denomination) of the Notes to be issued to the holder for the portion
of this Note not being repaid (in the absence of any such specification, one
such Note will be issued for the portion not being repaid).
Principal Amount to
be Repaid: $__________ ____________________________________________
Notice: The signature(s) on this Option to
Elect Repayment must correspond with the
name(s) as written upon the face of this
Notice in every particular, without
alteration or enlargement or any change
whatsoever.
Date:_________________
A-13
<PAGE> 1
EXHIBIT 4.3
EXHIBIT B
[FACE OF NOTE]
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY (THE "DEPOSITARY") (55 WATER STREET, NEW YORK, NEW YORK) TO THE
ISSUER HEREOF OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME
AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITARY AND ANY PAYMENT
IS MADE TO CEDE & CO., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.(1)
UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN CERTIFICATED
FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A
NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR
ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY.(2)
REGISTERED REGISTERED
No. FLR- PRINCIPAL AMOUNT:
CUSIP No.:
JDN REALTY CORPORATION
MEDIUM TERM NOTE
(Floating Rate)
INTEREST RATE BASIS ORIGINAL ISSUE DATE: STATED MATURITY DATE:
OR BASES:
IF LIBOR: IF CMT RATE:
[ ] LIBOR Reuters Designated CMT Telerate Page:
[ ] LIBOR Telerate Designated CMT Maturity Index:
- ------------------------------
1 This paragraph applies to global Notes only.
2 This paragraph applies to global Notes only.
<PAGE> 2
INDEX CURRENCY:
INDEX MATURITY: INITIAL INTEREST RATE: % INTEREST PAYMENT DATE(S):
SPREAD (PLUS OR SPREAD MULTIPLIER: INITIAL INTEREST RESET
MINUS): DATE:
MINIMUM INTEREST RATE: % MAXIMUM INTEREST RATE: %
INTEREST RESET DATE(S):
INITIAL REDEMPTION INITIAL REDEMPTION ANNUAL REDEMPTION
DATE: PERCENTAGE: % PERCENTAGE REDUCTION: %
OPTIONAL REPAYMENT CALCULATION AGENT:
DATE(S):
INTEREST CALCULATION: DAY COUNT CONVENTION:
[ ] Regular Floating Rate Note [ ] 30/360 for the period
[ ] Floating Rate/Fixed Rate Note from to
Fixed Rate Commencement Date: [ ] Actual/360 for the period
Fixed Interest Rate: % from to
[ ] Inverse Floating Rate Note [ ] Actual /Actual for the period
Fixed Interest Rate: % from to
[ ] Original Issue Discount Note Applicable Interest Rate Basis:
Issue Price: %
[ ] Other Floating Rate Note
SPECIFIED CURRENCY: AUTHORIZED DENOMINATION:
[ ] United States dollars [ ] $1,000 and integral multiples
[ ] Other: thereof
[ ] Other:
EXCHANGE RATE AGENT:
DEFAULT RATE: %
ADDENDUM ATTACHED
[ ] Yes
[ ] No
OTHER/ADDITIONAL PROVISIONS:
B-2
<PAGE> 3
JDN Realty Corporation, a Maryland corporation (the "Issuer," which
term includes any successor under the Indenture hereinafter referred to), for
value received, hereby promises to pay to_________________ or its registered
assigns, the principal sum of $________, on the Stated Maturity Date specified
above (or any Redemption Date or Repayment Date, each as defined on the reverse
hereof) (each such Stated Maturity Date, Redemption Date or Repayment Date being
hereinafter referred to as the "Maturity Date" with respect to the principal
repayable on such date) and to pay interest thereon, at a rate per annum equal
to the Initial Interest Rate specified above until the Initial Interest Reset
Date specified above and thereafter at a rate determined in accordance with the
provisions specified above and on the reverse hereof with respect to one or more
Interest Rate Bases specified above until the principal hereof is paid or duly
made available for payment, and (to the extent that the payment of such interest
shall be legally enforceable) at the Default Rate per annum specified above on
any overdue principal, premium and/or interest. The Issuer will pay interest in
arrears on each Interest Payment Date, if any, specified above (each, an
"Interest Payment Date"), commencing with the first Interest Payment Date next
succeeding the Original Issue Date specified above, and on the Maturity Date;
provided, however, that if the Original Issue Date occurs between a Record Date
(as defined below) and the next succeeding Interest Payment Date, interest
payments will commence on the second Interest Payment Date next succeeding the
Original Issue Date to the holder of this Note on the Record Date with respect
to such second Interest Payment Date.
Interest on this Note will accrue from, and including, the immediately
preceding Interest Payment Date to which interest has been paid or duly provided
for (or from, and including, the Original Issue Date if no interest has been
paid or duly provided for) to, but excluding, the applicable Interest Payment
Date or the Maturity Date, as the case may be (each, an "Interest Period"). The
interest so payable, and punctually paid or duly provided for, on any Interest
Payment Date will, subject to certain exceptions described herein, be paid to
the person in whose name this Note (or one or more predecessor Notes) is
registered at the close of business on the fifteenth calendar day (whether or
not a Business Day, as defined on the reverse hereof) immediately preceding such
Interest Payment Date (the "Record Date"); provided, however, that interest
payable on the Maturity Date will be payable to the person to whom the principal
hereof and premium, if any, hereon shall be payable. Any such interest not so
punctually paid or duly provided for ("Defaulted Interest") will forthwith cease
to be payable to the holder on any Record Date, and shall be paid to the person
in whose name this Note is registered at the close of business on a special
record date (the "Special Record Date") for the payment of such Defaulted
Interest to be fixed by the Trustee hereinafter referred to, notice whereof
shall be given to the holder of this Note by the Trustee not less than 10
calendar 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 this note may be listed, and upon such notice as may be
required by such exchange, all as more fully provided for in the Indenture.
Payment of principal, premium, if any, and interest in respect of this
Note due on the Maturity Date will be made in immediately available funds upon
presentation and surrender of this Note (and, with respect to any applicable
repayment of this Note, a duly completed election form as contemplated on the
reverse hereof) at the corporate trust office of the Trustee maintained for that
purpose in the Borough of Manhattan, The City of New York, currently
B-3
<PAGE> 4
located at 40 Broad Street, Suite 550, New York, New York 10004 or at such other
paying agency in the Borough of Manhattan, The City of New York, as the Issuer
may determine; provided, however, that if such payment is to be made in a
Specified Currency other than United States dollars as set forth below, such
payment will be made by wire transfer of immediately available funds to an
account with a bank designated by the holder hereof at least 15 calendar days
prior to the Maturity Date, provided that such bank has appropriate facilities
therefor and that this Note (and, if applicable, a duly completed repayment
election form) is presented and surrendered at the aforementioned office of the
Trustee in time for the Trustee to make such payment in such funds in accordance
with its normal procedures. Payment of interest due on any Interest Payment Date
other than the Maturity Date will be made by check mailed to the address of the
person entitled thereto as such address shall appear in the Security Register
maintained at the aforementioned office of the Trustee; provided, however, that
a holder of U.S. $10,000,000 (or, if the Specified Currency specified above is
other than United States dollars, the equivalent thereof in the Specified
Currency) or more in aggregate principal amount of Notes (whether having
identical or different terms and provisions) will be entitled to receive
interest payments on such Interest Payment Date by wire transfer of immediately
available funds if appropriate wire transfer instructions have been received in
writing by the Trustee not less than 15 calendar days prior to such Interest
Payment Date. Any such wire transfer instructions received by the Trustee shall
remain in effect until revoked by such holder.
If any Interest Payment Date other than the Maturity Date would
otherwise be a day that is not a Business Day, such Interest Payment Date shall
be postponed to the next succeeding Business Day, except that if LIBOR is an
applicable Interest Rate Basis and such Business Day falls in the next
succeeding calendar month, such Interest Payment Date shall be the immediately
preceding Business Day. If the Maturity Date falls on a day that is not a
Business Day, the required payment of principal, premium, if any, and interest
shall be made on the next succeeding Business Day with the same force and effect
as if made on the date such payment was due, and no interest shall accrue with
respect to such payment for the period from and after the Maturity Date to the
date of such payment on the next succeeding Business Day.
The Issuer is obligated to make payment of principal, premium, if any,
and interest in respect of this Note in the Specified Currency (or, if the
Specified Currency is not at the time of such payment legal tender for the
payment of public and private debts, in such other coin or currency of the
country which issued the Specified Currency as at the time of such payment is
legal tender for the payment of such debts). If the Specified Currency is other
than United States dollars, any such amounts so payable by the Issuer will be
converted by the Exchange Rate Agent specified above into United States dollars
for payment to the holder of this Note; provided, however, that the holder of
this Note may elect to receive such amounts in such Specified Currency pursuant
to the provisions set forth below.
If the Specified Currency is other than United States dollars and the
holder of this Note shall not have duly made an election to receive all or a
specified portion of any payment of principal, premium, if any, and/or interest
in respect of this Note in the Specified Currency, any United States dollar
amount to be received by the holder of this Note will be based on the highest
bid quotation in The City of New York received by the Exchange Rate Agent at
approximately
B-4
<PAGE> 5
11:00 A.M., New York City time, on the second Business Day preceding the
applicable payment date from three recognized foreign exchange dealers (one of
whom may be the Exchange Rate Agent) selected by the Exchange Rate Agent and
approved by the Issuer for the purchase by the quoting dealer of the Specified
Currency for United States dollars for settlement on such payment date in the
aggregate amount of the Specified Currency payable to all holders of Notes
scheduled to receive United States dollar payments and at which the applicable
dealer commits to execute a contract. All currency exchange costs will be borne
by the holder of this Note by deductions from such payments. If three such bid
quotations are not available, payments on this Note will be made in the
Specified Currency.
If the Specified Currency is other than United States dollars, the
holder of this Note may elect to receive all or a specified portion of any
payment of principal, premium, if any, and/or interest in respect of this Note
in the Specified Currency by submitting a written request for such payment to
the Trustee at its corporate trust office in The City of New York on or prior to
the applicable Record Date or at least 15 calendar days prior to the Maturity
Date, as the case may be. Such written request may be mailed or hand delivered
or sent by cable, telex or other form of facsimile transmission. The holder of
this Note may elect to receive all or a specified portion of all future payments
in the Specified Currency in respect of such principal, premium, if any, and/or
interest and need not file a separate election for such payment. Such election
will remain in effect until revoked by written notice to the Trustee, but
written notice of any such revocation must be received by the Trustee on or
prior to the applicable Record Date or at least 15 calendar days prior to the
Maturity Date, as the case may be.
If the Specified Currency is other than United States dollars or a
composite currency and the holder of this Note shall have duly made an election
to receive all or a specified portion of any payment of principal, premium, if
any, and/or interest in respect of this Note in the Specified Currency and if
the Specified Currency is not available due to the imposition of exchange
controls or other circumstances beyond the control of the Issuer, the Issuer
will be entitled to satisfy its obligations to the holder of this Note by making
such payment in United States dollars on the basis of the Market Exchange Rate
(as defined below) on the second Business Day prior to such payment date or, if
such Market Exchange Rate is not then available, on the basis of the most
recently available Market Exchange Rate or as otherwise specified on the face
hereof. The "Market Exchange Rate" for the Specified Currency means the noon
dollar buying rate in The City of New York for cable transfers for the Specified
Currency as certified for customs purposes by (or if not so certified, as
otherwise determined by) the Federal Reserve Bank of New York. Any payment made
under such circumstances in United States dollars will not constitute an Event
of Default (as defined in the Indenture).
If the Specified Currency is a composite currency and the holder of
this Note shall have duly made an election to receive all or a specified portion
of any payment of principal, premium, if any, and/or interest in respect of this
Note in the Specified Currency and if such composite currency is unavailable due
to the imposition of exchange controls or other circumstances beyond the control
of the Issuer, then the Issuer will be entitled to satisfy its obligations to
the holder of this Note by making such payment in United States dollars. The
amount of each payment in United States dollars shall be computed by the
Exchange Rate Agent on the basis of
B-5
<PAGE> 6
the equivalent of the composite currency in United States dollars. The component
currencies of the composite currency for this purpose (collectively, the
"Component Currencies" and each, a "Component Currency") shall be the currency
amounts that were components of the composite currency as of the last day on
which the composite currency was used. The equivalent of the composite currency
in United States dollars shall be calculated by aggregating the United States
dollar equivalents of the Component Currencies. The United States dollar
equivalent of each of the Component Currencies shall be determined by the
Exchange Rate Agent on the basis of the most recently available Market Exchange
Rate for each such Component Currency, or as otherwise specified on the face
hereof.
If the official unit of any Component Currency is altered by way of
combination or subdivision, the number of units of the currency as a Component
Currency shall be divided or multiplied in the same proportion. If two or more
Component Currencies are consolidated into a single currency, the amounts of
those currencies as Component Currencies shall be replaced by an amount in such
single currency equal to the sum of the amounts of the consolidated Component
Currencies expressed in such single currency. If any Component Currency is
divided into two or more currencies, the amount of the original Component
Currency shall be replaced by the amounts of such two or more currencies, the
sum of which shall be equal to the amount of the original Component Currency.
All determinations referred to above made by the Exchange Rate Agent
shall be at its sole discretion and shall, in the absence of manifest error, be
conclusive for all purposes and binding on the holder of this Note.
Reference is hereby made to the further provisions of this Note set
forth on the reverse hereof and, if so specified above, in the Addendum hereto,
which further provisions shall have the same force and effect as if set forth on
the face hereof.
Notwithstanding any provisions to the contrary contained herein, if the
face of this Note specifies that an Addendum is attached hereto or that
"Other/Additional Provisions" apply, this Note shall be subject to the terms set
forth in such Addendum or such "Other/Additional Provisions."
Unless the Certificate of Authentication hereon has been executed by
the Trustee by manual signature, this Note shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose.
B-6
<PAGE> 7
IN WITNESS WHEREOF, JDN Realty Corporation has caused this Note to be
duly executed.
JDN REALTY CORPORATION,
as Issuer
By:
----------------------------------------
Name:
Title:
Attest:
- ----------------------
Name:
Title:
[SEAL]
B-7
<PAGE> 8
TRUSTEE'S CERTIFICATE OF AUTHENTICATION:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
Dated:
----------------------
FIRST UNION NATIONAL BANK, ATLANTA,
as Trustee
By:
--------------------------------
Authorized Signatory
B-8
<PAGE> 9
[REVERSE OF NOTE]
JDN REALTY CORPORATION
MEDIUM-TERM NOTE
(Floating Rate)
This Note is one of a duly authorized series of Securities (the
"Securities") of the Issuer issued and to be issued under an Indenture, dated as
of July 15, 1997, as amended, modified or supplemented from time to time, (the
"Indenture"), between the Issuer and First Union National Bank, Atlanta, as
Trustee (the "Trustee," which term includes any successor trustee under the
Indenture), to which Indenture and all indentures supplemental thereto reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Issuer, 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 Note is one of the series of Securities
designated as "Medium-Term Notes Due Nine Months or More From Date of Issue"
(the "Notes"). All terms used but not defined in this Note specified on the face
hereof or in an Addendum hereto shall have the meanings assigned to such terms
in the Indenture.
This Note is issuable only in registered form without coupons in
minimum denominations of U.S. $1,000 and integral multiples thereof or the
minimum Authorized Denomination specified on the face hereof.
This Note will not be subject to any sinking fund and, unless otherwise
provided on the face hereof in accordance with the provisions of the following
two paragraphs, will not be redeemable or repayable prior to the Stated Maturity
Date.
This Note will be subject to redemption at the option of the Issuer on
any date on or after the Initial Redemption Date, if any, specified on the face
hereof, in whole or from time to time in part in increments of U.S. $1,000 or
the minimum Authorized Denomination (provided that any remaining principal
amount hereof shall be at least U.S. $1,000 or such minimum Authorized
Denomination), at the Redemption Price (as defined below), together with unpaid
interest accrued thereon to the date fixed for redemption (each, a "Redemption
Date"), on notice given no more than 60 nor less than 30 calendar days prior to
the Redemption Date and in accordance with the provisions of the Indenture. The
"Redemption Price" shall initially be the Initial Redemption Percentage
specified on the face hereof multiplied by the unpaid principal amount of this
Note to be redeemed. The Initial Redemption Percentage shall decline at each
anniversary of the Initial Redemption Date by an amount equal to the Annual
Redemption Percentage Reduction, if any, specified on the face hereof until the
Redemption Price is 100% of unpaid principal amount to be redeemed. In the event
of redemption of this Note in part only, a new Note of like tenor for the
unredeemed portion hereof and otherwise having the same terms as this Note shall
be issued in the name of the holder hereof upon the presentation and surrender
hereof.
This Note will be subject to repayment by the Issuer at the option of
the holder hereof on the Optional Repayment Date(s), if any, specified on the
face hereof, in whole or in part in increments of U.S. $1,000 or the minimum
Authorized Denomination (provided that any
B-9
<PAGE> 10
remaining principal amount hereof shall be at least U.S. $1,000 or such minimum
Authorized Denomination), at a repayment price equal to 100% of the unpaid
principal amount to be repaid, together with unpaid interest accrued thereon to
the date fixed for repayment (each, a "Repayment Date"). For this Note to be
repaid, this Note must be received, together with the form hereon entitled
"Option to Elect Repayment" duly completed, by the Trustee at its corporate
trust office not more than 60 nor less than 30 calendar days prior to the
Repayment Date. Exercise of such repayment option by the holder hereof will be
irrevocable. In the event of repayment of this Note in part only, a new Note of
like tenor for the unrepaid portion hereof and otherwise having the same terms
as this Note shall be issued in the name of the holder hereof upon the
presentation and surrender hereof.
If the Interest Category of this Note is specified on the face hereof
as an Original Issue Discount Note, the amount payable to the holder of this
Note in the event of redemption, repayment, or acceleration of maturity of this
Note will be equal to the sum of (1) the Issue Price specified on the face
hereof (increased by any accruals of the Discount, as defined below) and, in the
event of any redemption of this Note (if applicable), multiplied by the Initial
Redemption Percentage (as adjusted by the Annual Redemption Percentage
Reduction, if applicable) and (2) any unpaid interest on this Note accrued from
the Original Issue Date to the Redemption Date, Repayment Date or date of
acceleration of maturity, as the case may be. The difference between the Issue
Price and 100% of the principal amount of this Note is referred to herein as the
"Discount."
For purposes of determining the amount of Discount that has accrued as
of any Redemption Date, Repayment Date or date of acceleration of maturity of
this Note, such Discount will be accrued so as to cause an assumed yield on the
Note to be constant. The assumed constant yield will be calculated using a
30-day month, 360-day year convention, a compounding period that, except for the
Initial Period (as defined below), corresponds to the shortest period between
Interest Payment Dates (with ratable accruals within a compounding period), a
constant coupon rate equal to the initial interest rate applicable to this Note
and an assumption that the maturity of this Note will not be accelerated. If the
period from the Original Issue Date to the initial Interest Payment Date (the
"Initial Period") is shorter than the compounding period for this Note, a
proportionate amount of the yield for an entire compounding period will be
accrued. If the Initial Period is longer than the compounding period, then such
period will be divided into a regular compounding period and a short period,
with the short period being treated as provided in the preceding sentence.
The interest rate borne by this Note will be determined as follows:
(i) Unless the Interest Category of this Note is specified on
the face hereof as a "Floating Rate/Fixed Rate Note" or an "Inverse
Floating Rate Note," this Note shall be designated as a "Regular
Floating Rate Note" and, except as set forth below or on the face
hereof, shall bear interest at the rate determined by reference to the
applicable Interest Rate Basis or Bases (a) plus or minus the Spread,
if any, and/or (b) multiplied by the Spread Multiplier, if any, in each
case as specified on the face hereof. Commencing on the Initial
Interest Reset Date, the rate at which interest on this Note shall be
payable shall
B-10
<PAGE> 11
be reset as of each Interest Reset Date specified on the face hereof;
provided, however, that the interest rate in effect for the period, if
any, from the Original Issue Date to the Initial Interest Reset Date
shall be the Initial Interest Rate.
(ii) If the Interest Category of this Note is specified on
the face hereof as a "Floating Rate Fixed Rate Note," then, except as
set forth below or on the face hereof, this Note shall bear interest at
the rate determined by reference to the applicable Interest Rate Basis
or Bases (a) plus or minus the Spread, if any, and/or (b) multiplied by
the Spread Multiplier, if any. Commencing on the Initial Interest Reset
Date, the rate at which interest on this Note shall be payable shall be
reset as of each Interest Reset Date; provided, however, that (y) the
interest rate in effect for the period, if any, from the Original Issue
Date to the Initial Interest Reset Date shall be the Initial Interest
Rate and (z) the interest rate in effect for the period commencing on
the Fixed Rate Commencement Date specified on the face hereof to the
Maturity Date shall be the Fixed Interest Rate specified on the face
hereof or, if no such Fixed Interest Rate is specified, the interest
rate in effect hereon on the day immediately preceding the Fixed Rate
Commencement Date.
(iii) If the Interest Category of this Note is specified on
the face hereof as an "Inverse Floating Rate Note," then, except as set
forth below or on the face hereof, this Note shall bear interest at the
Fixed Interest Rate minus the rate determined by reference to the
applicable Interest Rate Basis or Bases (a) plus or minus the Spread,
if any, and/or (b) multiplied by the Spread Multiplier, if any;
provided, however, that, unless otherwise specified on the face hereof,
the interest rate hereon shall not be less than zero. Commencing on the
Initial Interest Reset Date, the rate at which interest on this Note
shall be payable shall be reset as of each Interest Reset Date;
provided, however, that the interest rate in effect for the period, if
any, from the Original Issue Date to the Initial Interest Reset Date
shall be the Initial Interest Rate.
Unless otherwise specified on the face hereof, the rate with respect to
each Interest Rate Basis will be determined in accordance with the applicable
provisions below. Except as set forth above or on the face hereof, the interest
rate in effect on each day shall be (i) if such day is an Interest Reset Date,
the interest rate determined as of the Interest Determination Date (as defined
below) immediately preceding such Interest Reset Date or (ii) if such day is not
an Interest Reset Date, the interest rate determined as of the Interest
Determination Date immediately preceding the most recent Interest Reset Date.
If any Interest Reset Date would otherwise be a day that is not a
Business Day, such Interest Reset Date shall be postponed to the next succeeding
Business Day, except that if LIBOR is an applicable Interest Rate Basis and such
Business Day falls in the next succeeding calendar month, such Interest Reset
Date shall be the immediately preceding Business Day. In addition, if the
Treasury Rate is an applicable Interest Rate Basis and the Interest
Determination Date would otherwise fall on an Interest Reset Date, then such
Interest Reset Date will be postponed to the next succeeding Business Day.
B-11
<PAGE> 12
As used herein, "Business Day" means any day, other than a Saturday or
Sunday, or other day on which banking institutions are authorized or required by
law, regulation or executive order to close in the City of New York; provided,
however, that if the Specified Currency is other than United States dollars and
any payment is to be made in the Specified Currency in accordance with the
provisions hereof, such day is also not a day on which banking institutions are
authorized or required by law or executive order to close in the Principal
Financial Center (as defined below) of the country issuing the Specified
Currency (or, in the case of European Currency Units ("ECU"), is not a day that
appears as an ECU non-settlement day on the display designated as "ISDE" on the
Reuter Monitor Money Rates Service (or a day so designated by the ECU Banking
Association) or, if ECU non-settlement days do not appear on that page (and are
not so designated), is not a day on which payments in ECU cannot be settled in
the international interbank market; provided, further, that if LIBOR is an
applicable Interest Rate Basis, such day is a London Business Day (as defined
below). "London Business Day" means any day (i) if the Designated LIBOR Currency
(as defined below) is other than ECU, on which dealings in such Designated LIBOR
Currency are transacted in the London interbank market or (ii) if the Designated
LIBOR Currency is ECU, that is not designated as an ECU non-settlement day on
the display designated as "ISDE" on the Reuter Monitor Money Rates Service (or a
day so designated by the ECU Banking Association) or, if ECU non-settlement days
do not appear on that page (and are not so designated), is not a day on which
payments in ECU cannot be settled in the international interbank market.
"Principal Financial Center" means the capital city of the country issuing the
Specified Currency, or solely with respect to the calculation of LIBOR, the
Designated LIBOR Currency, except that with respect to United States dollars,
Australian dollars, Canadian dollars, Deutsche marks, Dutch guilders, Italian
lire and Swiss francs, the Principal Financial Center shall be The City of New
York, Sydney, Toronto, Frankfurt, Amsterdam, Milan and Zurich, respectively.
The "Interest Determination Date" with respect to the CD rate, the CMT
Rate, the Commercial Paper Rate, the Federal Funds Rate and the Prime Rate will
be the second Business Day immediately preceding the applicable Interest Reset
Date; the "Interest Determination Date" with respect to the Eleventh District
Cost of Funds Rate will be the last working day of the month immediately
preceding the applicable Interest Reset Date on which the Federal Home Loan Bank
of San Francisco ("the FHLB of San Francisco") publishes the Index (as defined
below); and the "Interest Determination Date" with respect to LIBOR shall be the
second London Business Day immediately preceding the applicable Interest Reset
Date, unless the Designated LIBOR Currency is British pounds sterling, in which
case the "Interest Determination Date" will be the applicable Interest Reset
Date. The "Interest Determination Date" with respect to the Treasury Rate will
be the day in the week in which the applicable Interest Reset Date falls on
which day Treasury Bills (as defined below) are normally auctioned (Treasury
Bills are normally sold at an auction held on Monday of each week, unless that
day is a legal holiday, in which case the auction is normally held on the
following Tuesday, except that such auction may be held on the preceding
Friday); provided, however, that if an auction is held on the Friday of the week
preceding the applicable Interest Reset Date, the Interest Determination Date
shall be such preceding Friday. If the interest rate of this Note is determined
with reference to two or more Interest Rate Bases specified on the face hereof,
the "Interest Determination Date" pertaining to this Note shall be the most
recent Business Day which is at
B-12
<PAGE> 13
least two Business Days prior to the applicable Interest Reset Date on which
each Interest Rate Basis is determinable. Each Interest Rate Basis shall be
determined as of such date, and the applicable interest rate shall take effect
on the related Interest Reset Date.
CD Rate. If an Interest Rate Basis for this Note is specified on the
face hereof, as the CD Rate, the CD Rate shall be determined as of the
applicable Interest Determination Date (a "CD Rate Interest Determination Date")
as the rate on such date for negotiable United States dollar certificates of
deposit having the Index Maturity specified on the face hereof as published by
the Board of Governors of the Federal Reserve System in "Statistical Release
H.15(519), Selected Interest Rates" or any successor publication ("H.15(519)")
under the heading "CDs (Secondary Market)," or, if not published by 3:00 P.M.,
New York City time, on the related Calculation Date (as defined below), the rate
on such CD Rate Interest Determination Date for negotiable United States dollar
certificates of deposit of the Index Maturity as published by the Federal
Reserve Bank of New York in its daily statistical release "Composite 3:30 P.M.
Quotations for United States Government Securities" or any successor publication
("Composite Quotations") under the heading "Certificates of Deposit." If such
rate is not yet published in either H.15(519) or Composite Quotations by 3:00
P.M., New York City time, on the related Calculation Date, then the CD Rate on
such CD Rate Interest Determination Date will be calculated by the Calculation
Agent specified on the face hereof and will be the arithmetic mean of the
secondary market offered rates as of 10:00 A.M., New York City time, on such CD
Rate Interest Determination Date, of three leading nonbank dealers in negotiable
United States dollar certificates of deposit in The City of New York (which may
include an Agent or its affiliates) selected by the Calculation Agent for
negotiable certificates of deposit of major United States money market banks for
negotiable certificates of deposit with a remaining maturity closest to the
Index Maturity in an amount that is representative for a single transaction in
that market at that time; provided, however, that if the dealers so selected by
the Calculation Agent are not quoting as mentioned in this sentence, the CD Rate
determined as of such CD Rate Interest Determination Date will be the CD Rate in
effect on such CD Rate Interest Determination Date.
CMT Rate. If an Interest Rate Basis for this Note is specified on the
face hereof as the CMT rate, the CMT Rate shall be determined as of the
applicable Interest Determination Date (a "CMT Rate Interest Determination
Date") as the rate displayed on the Designated CMT Telerate Page (as defined
below) under the caption." . .Treasury Constant Maturities . . . Federal Reserve
Board Release H.15 . . . Mondays Approximately 3:45 P.M.," under the column for
the Designated CMT Maturity Index (as defined below) for (i) if the Designated
CMT Telerate Page is 7055, the rate on such CMT Rate Interest Determination Date
and (ii) if the Designated CMT Telerate Page is 7052, the week, or the month, as
applicable, ended immediately preceding the week in which the related CMT Rate
Interest Determination Date occurs. If such rate is no longer displayed on the
relevant page or is not displayed by 3:00 P.M., New York City time, on the
related Calculation Date, then the CMT Rate for such CMT Rate Interest
Determination Date will be such treasury constant maturity rate for the
Designated CMT Maturity Index as published in the relevant H.15(519). If such
rate is no longer published or is not published by 3:00 P.M., New York City
time, on the related Calculation Date, then the CMT Rate on such CMT Rate
Interest Determination Date will be such treasury constant maturity rate for the
Designated CMT Maturity Index (or other United States Treasury rate for the
Designated CMT Maturity Index) for
B-13
<PAGE> 14
the CMT Rate Interest Determination Date with respect to such Interest Reset
Date as may then be published by either the Board of Governors of the Federal
Reserve System or the United States Department of the Treasury that the
Calculation Agent determines to be comparable to the rate formerly displayed on
the Designated CMT Telerate Page and published in the relevant H.15(519). If
such information is not provided by 3:00 P.M., New York City time, on the
related Calculation Date, then the CMT Rate on the CMT Rate Interest
Determination Date will be calculated by the Calculation Agent and will be a
yield to maturity, based on the arithmetic mean of the secondary market closing
offer side prices as of approximately 3:30 P.M., New York City time, on such CMT
Rate Interest Determination Date reported, according to their written records,
by three leading primary United States government securities dealers (each, a
"Reference Dealer") in The City of New York (which may include an Agent or its
affiliates) selected by the Calculation Agent (from five such Reference Dealers
selected by the Calculation Agent and eliminating the highest quotation (or, in
the event of equality, one of the highest) and the lowest quotation (or, in the
event of equality, one of the lowest)), for the most recently issued direct
noncallable fixed rate obligations of the United States ("Treasury Notes") with
an original maturity of approximately the Designated CMT Maturity Index and a
remaining term to maturity of not less than such Designated CMT Maturity Index
minus one year. If the Calculation Agent is unable to obtain three such Treasury
Note quotations, the CMT Rate on such CMT Rate Interest Determination Date will
be calculated by the Calculation Agent and will be a yield to maturity based on
the arithmetic mean of the secondary market offer side prices as of
approximately 3:30 P.M., New York City time, on such CMT Rate Interest
Determination Date of three Reference Dealers in The City of New York (from five
such Reference Dealers selected by the Calculation Agent and eliminating the
highest quotation (or, in the event of equality, one of the highest) and the
lowest quotation (or, in the event of equality, one of the lowest)), for
Treasury Notes with an original maturity of the number of years that is the next
highest to the Designated CMT Maturity Index and a remaining term to maturity
closest to the Designated CMT Maturity Index and in an amount of at least $100
million. If three or four (and not five) of such Reference Dealers are quoting
as described above, then the CMT Rate will be based on the arithmetic mean of
the offer prices obtained and neither the highest nor the lowest of such quotes
will be eliminated; provided, however, that if fewer than three Reference
Dealers selected by the Calculation Agent are quoting as mentioned herein, the
CMT Rate determined as of such CMT Rate Interest Determination Date will be the
CMT Rate in effect on such CMT Rate Interest Determination Date. If two Treasury
Notes with an original maturity as described in the second preceding sentence
have remaining terms to maturity equally close to the Designated CMT Maturity
Index, the quotations for the Treasury Note with the shorter remaining term to
maturity will be used.
"Designated CMT Telerate Page" means the display on the Dow Jones
Telerate Service on the page specified on the face hereof (or any other page as
may replace such page on that service for the purpose of displaying Treasury
Constant Maturities as reported in H.15(519)) for the purpose of displaying
Treasury Constant Maturities as reported in H.15(519). If no such page is
specified on the face hereof, the Designated CMT Telerate Page shall be 7052,
for the most recent week.
B-14
<PAGE> 15
"Designated CMT Maturity Index" means the original period to maturity
of the United States Treasury securities (either 1, 2, 3, 5, 7, 10, 20 or 30
years) specified on the face hereof with respect to which the CMT Rate will be
calculated. If no such maturity is specified on the face hereof, the Designated
CMT Maturity Index shall be two years.
Commercial Paper Rate. If an Interest Rate Basis for this Note is
specified on the face hereof as the Commercial Paper Rate, the Commercial Paper
Rate shall be determined as of the applicable Interest Determination Date (a
"Commercial Paper Rate Interest Determination Date") as the Money Market Yield
(as defined below) on such date of the rate for commercial paper having the
Index Maturity as published in H.15(519) under the heading "Commercial Paper."
In the event that such rate is not published by 3:00 P.M., New York City time,
on such Calculation Date, then the Commercial Paper Rate on such Commercial
Paper Rate Interest Determination Date will be the Money Market Yield of the
rate for commercial paper having the Index Maturity as published in Composite
Quotations under the heading "Commercial Paper" (with an Index Maturity of one
month or three months being deemed to be equivalent to an Index Maturity of 30
days or 90 days, respectively). If such rate is not yet published in either
H.15(519) or Composite Quotations by 3:00 P.M., New York City time, on such
Calculation Date, then the Commercial Paper Rate on such Commercial Paper Rate
Interest Determination Date will be calculated by the Calculation Agent and
shall be the Money Market Yield of the arithmetic mean of the offered rates at
approximately 11:00 A.M., New York City time, on such Commercial Paper Rate
Interest Determination Date of three leading dealers of commercial paper in The
City of New York selected by the Calculation Agent for commercial paper having
the Index Maturity placed for an industrial issuer whose bond rating is "AA," or
the equivalent, from a nationally recognized statistical rating organization;
provided, however, that if the dealers so selected by the Calculation Agent are
not quoting as mentioned in this sentence, the Commercial Paper Rate determined
as of such Commercial Paper Rate Interest Determination Date will be the
Commercial Paper Rate in effect on such Commercial Paper Rate Interest
Determination Date.
"Money Market Yield" means a yield (expressed as a percentage)
calculated in accordance with the following formula:
Money Market Yield = D x 360 x 100
-----------------
360 - (D x M)
where "D" refers to the applicable per annum rate for commercial paper quoted on
a bank discount basis and expressed as a decimal, and "M" refers to the actual
number of days in the Interest Period for which interest is being calculated.
Eleventh District Cost Of Funds Rate. If an Interest Rate Basis for
this Note is specified on the face hereof as the Eleventh District Cost of Funds
Rate, the Eleventh District Cost of Funds Rate shall be determined as of the
applicable Interest Determination Date (an "Eleventh District Cost of Funds Rate
Interest Determination Date") as the rate equal to the monthly weighted average
cost of funds for the calendar month immediately preceding the month in which
such Eleventh District Cost of Funds Rate Interest Determination Date falls, as
set forth under the caption "11th District" on Telerate Page 7058 as of 11:00
A.M., San Francisco time, on
B-15
<PAGE> 16
such Eleventh District Cost of Funds Rate Interest Determination Date. If such
rate does not appear on Telerate Page 7058 on such Eleventh District Cost of
Funds Rate Interest Determination Date, then the Eleventh District Cost of Funds
Rate on such Eleventh District Cost of Funds Rate Interest Determination Date
shall be the monthly weighted average cost of funds paid by member institutions
of the Eleventh Federal Home Loan Bank District that was most recently announced
(the "Index") by the FHLB of San Francisco as such cost of funds for the
calendar month immediately preceding such Eleventh District Cost of Funds Rate
Interest Determination Date. If the FHLB of San Francisco fails to announce the
Index on or prior to such Eleventh District Cost of Funds Rate Interest
Determination Date for the calendar month immediately preceding such Eleventh
District Cost of Funds Rate Interest Determination Date, the Eleventh District
Cost of Funds Rate determined as of such Eleventh District Cost of Funds Rate
Interest Determination Date will be the Eleventh District Cost of Funds Rate in
effect on such Eleventh District Cost of Funds Rate Interest Determination Date.
Federal Funds Rate. If an Interest Rate Basis for this Note is
specified on the face hereof as the Federal Funds Rate, the Federal Funds Rate
shall be determined as of the applicable Interest Determination Date (a "Federal
Funds Rate Interest Determination Date") as the rate on such date for United
States dollar federal funds as published in H.15(519) under the heading "Federal
Funds (Effective)" or, if not published by 3:00 P.M., New York City time, on the
Calculation Date, the rate on such Federal Funds Rate Interest Determination
Date as published in Composite Quotations under the heading "Federal
Funds/Effective Rate." If such rate is not published in either H.15(519) or
Composite Quotations by 3:00 P.M., New York City time, on the related
Calculation Date, then the Federal Funds Rate on such Federal Funds Interest
Determination Date will be calculated by the Calculation Agent and will be the
arithmetic mean of the rates for the last transaction in overnight United States
dollar federal funds arranged by three leading brokers of federal funds
transactions in The City of New York selected by the Calculation Agent, prior to
9:00 A.M., New York City time, on such Federal Funds Rate Interest Determination
Date; provided, however, that if the brokers so selected by the Calculation
Agent are not quoting as mentioned in this sentence, the Federal Funds Rate
determined as of such Federal Funds Rate Interest Determination Date will be the
Federal Funds Rate in effect on such Federal Funds Rate Interest Determination
Date.
LIBOR. If an Interest Rate Basis for this Note is specified on the face
hereof as LIBOR, LIBOR shall be determined by the Calculation Agent, as of the
applicable Interest Determination Date (a "LIBOR Interest Determination Date")
in accordance with the following provisions:
(i) if (a) "LIBOR Reuters" is specified on the face hereof,
the arithmetic mean of the offered rates (unless the Designated LIBOR
Page (as defined below) by its terms provides only for a single rate,
in which case such single rate will be used) for deposits in the
Designated LIBOR Currency having the Index Maturity, commencing on the
applicable Interest Reset Date, that appear (or, if only a single rate
is required as aforesaid, appears) on the Designated LIBOR Page (as
defined below) as of 11:00 A.M., London time, on such LIBOR Interest
Determination Date, or (b) "LIBOR Telerate" is specified on the face
hereof, or if neither "LIBOR Reuters" nor "LIBOR Telerate" is specified
on the face hereof as the method for calculating LIBOR, the rate for
deposits in
B-16
<PAGE> 17
the Designated LIBOR Currency having the Index Maturity, commencing on
such Interest Reset Date, that appears on the Designated LIBOR Page as
of 11:00 A.M., London time, on such LIBOR Interest Determination Date.
If fewer than two such offered rates appear, or if no such rate
appears, as applicable, LIBOR on such LIBOR Interest Determination Date
will be determined in accordance with the provisions described in
clause (ii) below.
(ii) With respect to a LIBOR Interest Determination Date on
which fewer than two offered rates appear, or no rate appears, as the
case may be, on the Designated LIBOR Page as specified in clause (i)
above, the Calculation Agent will request the principal London offices
of each of four major reference banks in the London interbank market,
as selected by the Calculation Agent, to provide the Calculation Agent
with its offered quotation for deposits in the Designated LIBOR
Currency for the period of the Index Maturity, commencing on the
applicable Interest Reset Date, to prime banks in the London interbank
market at approximately 11:00 A.M., London time, on such LIBOR Interest
Determination Date and in a principal amount that is representative for
a single transaction in such Designated LIBOR Currency in such market
at such time. If at least two such quotations are so provided, then
LIBOR on such LIBOR Interest Determination Date will be the arithmetic
mean of such quotations. If fewer than two such quotations are so
provided, then LIBOR on such LIBOR Interest Determination Date will be
the arithmetic mean of the rates quoted at approximately 11:00 A.M., in
the applicable Principal Financial Center, on such LIBOR Interest
Determination Date by three major banks in such Principal Financial
Center selected by the Calculation Agent for loans in the Designated
LIBOR Currency to leading European banks, having the Index Maturity and
in a principal amount that is representative for a single transaction
in such Designated LIBOR Currency in such market at such time;
provided, however, that if the banks so selected by the Calculation
Agent are not quoting as mentioned in this sentence, LIBOR determined
as of such LIBOR Interest Determination Date shall be LIBOR in effect
on such LIBOR Interest Determination Date.
"Designated LIBOR Currency" means the currency or composite currency
specified on the face hereof as to which LIBOR shall be calculated. If no such
currency or composite currency is specified on the face hereof, the Designated
LIBOR Currency shall be United States dollars.
"Designated LIBOR Page" means (a) if "LIBOR Reuters" is specified on
the face hereof, the display on the Reuter Monitor Money Rates Service (or any
successor service) for the purpose of displaying the London interbank rates of
major banks for the Designated LIBOR Currency, or (b) if "LIBOR Telerate" is
specified on the face hereof or neither "LIBOR Reuters" nor "LIBOR Telerate" is
specified on the face hereof as the method for calculating LIBOR, the display on
the Dow Jones Telerate Service (or any successor service) for the purpose of
displaying the London interbank rates of major banks for the Designated LIBOR
Currency.
Prime Rate. If an Interest Rate Basis for this Note is specified on the
face hereto as the Prime Rate, the Prime Rate shall be determined as of the
applicable Interest Determination Date
B-17
<PAGE> 18
(a "Prime Rate Interest Determination Date") as the rate on such date as such
rate is published in H.15(519) under the heading "Bank Prime Loan." If such rate
is not published prior to 3:00 P.M., New York City time, on the related
Calculation Date, then the Prime Rate shall be the arithmetic mean of the rates
of interest publicly announced by each bank that appears on the Reuters Screen
USPRIME1 Page (as defined below) as such bank's prime rate or base lending rate
as in effect for such Prime Rate Interest Determination Date. If fewer than four
such rates appear on the Reuters Screen USPRIME1 Page for such Prime Rate
Interest Determination Date, the Prime Rate shall be the arithmetic mean of the
prime rates quoted on the basis of the actual number of days in the year divided
by a 360-day year as of the close of business on such Prime Rate Interest
Determination Date by four major money center banks in The City of New York
selected by the Calculation Agent. If fewer than four such quotations are so
provided, then the Prime Rate shall be the arithmetic mean of four prime rates
quoted on the basis of the actual number of days in the year divided by a
360-day year as of the close of business on such Prime Rate Interest
Determination Date as furnished in The City of New York by the major money
center banks, if any, that have provided such quotations and by as many
substitute banks or trust companies as necessary to obtain four such prime rate
quotations, provided such substitute banks or trust companies are organized and
doing business under the laws of the United States, or any State thereof, each
having total equity capital of at least U.S. $500 million and being subject to
supervision or examination by Federal or State authority, selected by the
Calculation Agent to provide such rate or rates; provided, however, that if the
banks or trust companies so selected by the Calculation Agent are not quoting as
mentioned in this sentence, the Prime Rate determined as of such Prime Rate
Interest Determination Date will be the Prime Rate in effect on such Prime Rate
Interest Determination Date.
"Reuters Screen USPRIME1 Page" means the display designated as page
"USPRIME1" on the Reuter Monitor Money Rates Service (or such other page as may
replace the USPRIME1 page on that service for the purpose of displaying prime
rates or base lending rates of major United States banks).
Treasury Rate. If an Interest Rate Basis for this Note is specified on
the face hereof as the Treasury Rate, the Treasury Rate shall be determined as
of the applicable Interest Determination Date (a "Treasury Rate Interest
Determination Date") as the rate from the auction held on such Treasury Rate
Interest Determination Date (the "Auction") of direct obligations of the United
States ("Treasury Bills") having the Index Maturity, as such rate is published
in H.15(519) under the heading "Treasury bills-auction average (investment)" or,
if not published by 3:00 P.M., New York City time, on the related Calculation
Date, the auction average rate of such Treasury Bills (expressed as a bond
equivalent on the basis of a year of 365 or 366 days, as applicable, and applied
on a daily basis) as otherwise announced by the United States Department of the
Treasury. If the results of the Auction of Treasury Bills having the Index
Maturity are not reported as provided above by 3:00 P.M., New York City time, on
such Calculation Date, or if no such Auction is held, then the Treasury Rate
shall be calculated by the Calculation Agent and shall be a yield to maturity
(expressed as a bond equivalent on the basis of a year of 365 or 366 days, as
applicable, and applied on a daily basis) of the arithmetic mean of the
secondary market bid rates, as of approximately 3:30 P.M., New York City time,
on such Treasury Rate Interest Determination Date, of three leading primary
United States government
B-18
<PAGE> 19
securities dealers selected by the Calculation Agent, for the issue of Treasury
Bills with a remaining maturity closest to the Index Maturity; provided,
however, that if the dealers so selected by the Calculation Agent are not
quoting as mentioned in this sentence, the Treasury Rate determined as of such
Treasury Rate Interest Determination Date will be the Treasury Rate in effect on
such Treasury Rate Interest Determination Date.
Notwithstanding the foregoing, the interest rate hereon shall not be
greater than the Maximum Interest Rate, if any, or less than the Minimum
Interest Rate, if any, in each case as specified on the face hereof. The
interest rate on this Note will in no event be higher than the maximum rate
permitted by New York law, as the same may be modified by United States law of
general application.
The Calculation Agent shall calculate the interest rate hereon on or
before each Calculation Date. The "Calculation Date," if applicable, pertaining
to any Interest Determination Date shall be the earlier of (i) the tenth
calendar day after such Interest Determination Date or, if such day is not a
Business Day, the next succeeding Business Day or (ii) the Business Day
immediately preceding the applicable Interest Payment Date or the Maturity Date,
as the case may be. At the request of the Holder hereof, the Calculation Agent
will provide to the Holder hereof the interest rate hereon then in effect and,
if determined, the interest rate that will become effective as a result of a
determination made for the next succeeding Interest Reset Date.
Accrued interest hereon shall be an amount calculated by multiplying
the principal amount hereof by an accrued interest factor. Such accrued interest
factor shall be computed by adding the interest factor calculated for each day
in the applicable Interest Period. Unless otherwise specified as the Day Count
Convention on the face hereof, the interest factor for each such date shall be
computed by dividing the interest rate applicable to such day by 360 if the CD
Rate, the Commercial Paper Rate, the Eleventh District Cost of Funds Rate, the
Federal Funds Rate, LIBOR or the Prime Rate is an applicable Interest Rate Basis
or by the actual number of days in the year if the CMT Rate or the Treasury Rate
is an applicable Interest Rate Basis. Unless otherwise specified as the Day
Count Convention on the face hereof, the interest factor for this Note, if the
interest rate is calculated with reference to two or more Interest Rate Bases,
shall be calculated in each period in the same manner as if only the Applicable
Interest Rate Basis specified on the face hereof applied.
All percentages resulting from any calculation on this Note shall be
rounded to the nearest one hundred-thousandth of a percentage point, with five
one-millionths of a percentage point rounded upwards, and all amounts used in or
resulting from such calculation on this Note shall be rounded, in the case of
United States dollars, to the nearest cent or, in the case of a Specified
Currency other than United States dollars, to the nearest unit (with one half
cent or unit being rounded upwards).
If an Event of Default, as defined in the Indenture, shall occur and be
continuing, the principal of the Notes may be declared due and payable in the
manner and with the effect provided in the Indenture.
B-19
<PAGE> 20
The Indenture contains provisions for defeasance of (i) the entire
indebtedness of the Notes or (ii) certain covenants and Events of Default with
respect to the Notes, in each case upon compliance with certain conditions set
forth therein, which provisions apply to the Notes.
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Issuer and the rights of the holders of the Securities at any time by the Issuer
and the Trustee with the consent of the holders of not less than a majority of
the aggregate principal amount of all Securities at the time outstanding and
affected thereby. The Indenture also contains provisions permitting the holders
of not less than a majority of the aggregate principal amount of the outstanding
Securities of any series, on behalf of the holders of all such Securities, to
waive compliance by the Issuer with certain provisions of the Indenture.
Furthermore, provisions in the Indenture permit the holders of not less than a
majority of the aggregate principal amount of the outstanding Securities of any
series, in certain instances, to waive, on behalf of all of the holders of
Securities of such series, certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the holder of this Note shall be
conclusive and binding upon such holder and upon all future holders of this Note
and other Notes issued upon the registration of transfer hereof or in exchange
herefore or in lieu hereof, whether or not notation of such consent or waiver is
made upon this Note.
No reference herein to the Indenture and no provisions of this Note or
of the Indenture shall alter or impair the obligation of the Issuer, which is
absolute and unconditional, to pay principal, premium, if any, and interest in
respect of this Note at the times, places and rate or formula, and in the coin
or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein
and herein set forth, the transfer of this Note is registrable in the Security
Register of the Issuer upon surrender of this Note for registration of transfer
at the office or agency of the Issuer in any place where the principal hereof
and any premium or interest hereon are payable, duly endorsed by, or accompanied
by a written instrument of transfer in form satisfactory to the Issuer and the
Security Registrar duly executed by, the holder hereof or by his attorney duly
authorized in writing, and thereupon one or more new Notes, of authorized
denominations and for the same aggregate principal amount, will be issued to the
designated transferee or transferees.
As provided in the Indenture and subject to certain limitations therein
and herein set forth, this Note is exchangeable for a like aggregate principal
amount of Notes of different authorized denominations but otherwise having the
same terms and conditions, as requested by the holder hereof surrendering the
same.
No service charge shall be made for any such registration of transfer
or exchange, but the Issuer 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 Note for registration of transfer, the
Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the
holder in whose name this Note is
B-20
<PAGE> 21
registered as the owner thereof for all purposes, whether or not this Note be
overdue, and neither the Issuer, the Trustee nor any such agent shall be
affected by notice to the contrary.
The Indenture and this note shall be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and to be performed entirely in such State.
B-21
<PAGE> 22
ABBREVIATIONS
The following abbreviations, when used in the inscription on the face
of this Note, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT -_____Custodian _____
TEN ENT - as tenants by the entireties (Cust) (Minor)
JT TEN - as joint tenants with right of under Uniform Gifts to Minors Act
survivorship and not as tenants
in common __________________________
(State)
Additional abbreviations may also be used though not in the above list.
------------------------------
ASSIGNMENT
FOR VALUE RECEIVED, the undersigned hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR
OTHER
IDENTIFYING NUMBER OF ASSIGNEE
________________________________
________________________________________________________________________________
(Please print or typewrite name and address including postal zip code of
assignee)
______________________________________________________ this Note and all rights
thereunder hereby irrevocably constituting and appointing
______________________________________________________ Attorney to transfer this
Note on the books of the Trustee, with full power of substitution in the
premises.
Dated: _________________ _________________________________
________________________________________
Notice: This signature(s) on this
Assignment must correspond with the
name(s) as written upon the face of this
Note in every particular, without
alteration or enlargement or any change
whatsoever.
B-22
<PAGE> 23
OPTION TO ELECT REPAYMENT
The undersigned hereby irrevocably request(s) and instruct(s) the
Issuer to repay this Note (or portion hereof specified below) pursuant to its
terms at a price equal to 100% of the principal amount to be repaid, together
with unpaid interest accrued hereon to the Repayment Date, to the undersigned,
at
________________________________________________________________________________
(Please print or typewrite name and address of the undersigned)
For this Note to be repaid, the Trustee must receive at its corporate
trust office in the Borough of Manhattan, The City of New York, currently
located at 40 Broad Street, Suite 550, New York, New York 10004 not more than 60
nor less than 30 calendar days prior to the Repayment Date, this Note with this
"Option to Elect Repayment" form duly completed.
If less than the entire principal amount of this Note is to be repaid,
specify the portion hereof (which shall be increments of U.S. $1,000 (or, if the
Specified Currency is other than United States dollars, the minimum Authorized
Denomination specified on the face hereof)) which the holder elects to have
repaid and specify the denomination or denominations (which shall be an
Authorized Denomination) of the Notes to be issued to the holder for the portion
of this Note not being repaid (in the absence of any such specification, one
such Note will be issued for the portion not being repaid).
Principal Amount
to be Repaid: $_________ ___________________________________
Notice: The signature(s) on this Option
to Elect Repayment must correspond with
the name(s) as written upon the face of
this Note in every particular, without
alteration or enlargement or any change
whatsoever.
Date:___________________
B-23
<PAGE> 1
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
FACSIMILE (615) 244-6380 809 SOUTH MAIN STREET
(615) 244-6804 P.O. BOX 1035
COLUMBIA, TN 38402-1035
(931) 388-6031
February 5, 1998
JDN Realty Corporation
3340 Peachtree Road, N.E.
Suite 1530
Atlanta, Georgia 30326
RE: JDN REALTY CORPORATION -- PROSPECTUS SUPPLEMENT DATED FEBRUARY 5,
1998 (TO THE PROSPECTUS DATED OCTOBER 30, 1997)
Ladies and Gentlemen:
We are acting as your counsel in connection with the proposed issue and
sale from time to time of the Company's Medium-Term Notes Due Nine Months or
More from Date of Issue (the "Notes"), offered in an aggregate initial offering
price of up to $505,500,000, pursuant to the terms of a Distribution Agreement
dated February 5, 1998 between the Company and Merrill Lynch, Pierce, Fenner &
Smith Incorporated ("Merrill Lynch"), BT Alex. Brown Incorporated, Morgan
Stanley & Co., Incorporated and Salomon Brothers Inc (the "Terms Agreement"). A
registration statement on Form S-3 (Registration No. 333-38611) (the
"Registration Statement"), including the Prospectus dated October 30, 1997 (the
"Prospectus") as supplemented by the Prospectus Supplement dated February 5,
1998 (the "Prospectus Supplement"), relating to these securities has been filed
with the Securities and Exchange Commission and was declared effective on
October 30, 1998.
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 Notes have been duly
authorized by all necessary corporate action and, when delivered and issued upon
payment therefor in the manner and on the terms described in the Registration
Statement, the Prospectus, the Prospectus Supplement, and the Distribution
Agreement, will be valid and binding obligations of the Company.
<PAGE> 2
JDN Realty Corporation
February 5, 1998
Page 2
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, PLLC
<PAGE> 1
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
FACSIMILE (615) 244-6380 809 SOUTH MAIN STREET
(615) 244-6804 P.O. BOX 1035
COLUMBIA, TN 38402-1035
(931) 388-6031
February 5, 1998
JDN Realty Corporation
3340 Peachtree Road
Suite 1530
Atlanta, Georgia 30326
RE: JDN REALTY CORPORATION -
PROSPECTUS SUPPLEMENT DATED FEBRUARY 5, 1998
(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 proposed issue and sale from
time to time of up to $505,500,000 of the Company's Medium-Term Notes Due Nine
Months or More From Date of Issue (the "Notes") under the terms of the
Distribution Agreement, dated February 5, 1998 (the "Agreement"), by and between
the Company and Merrill Lynch, Pierce, Fenner & Smith Incorporated, BT Alex.
Brown Incorporated, Morgan Stanley & Co. Incorporated, Salomon Brothers Inc, as
agents (the "Agents"), as more fully described in the Company's Prospectus
Supplement dated February 5, 1998 (to the Prospectus dated October 30, 1997),
included in the Registration Statement on Form S-3 (File No. 333-38611) (the
"Registration Statement"). In connection with the public offering of the Notes,
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, December 31, 1996 and December 31, 1997 and that 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 of the Notes.
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, 1996 and 1997,
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);
<PAGE> 2
JDN Realty Corporation
3340 Peachtree Road
Suite 1530
Atlanta, Georgia 30326
February 5, 1998
Page 2
(b) Compliance with the applicable REIT ratios or tests for the fiscal
years ended December 31, 1994, 1995, 1996 and 1997 and projected compliance with
such tests for the fiscal year ending December 31, 1998, including:
Income tests:
(1) 95% gross income test for the year;
(2) 75% gross income test for the year; and
(3) 30% gross income test for each year prior to the fiscal
year ending December 31, 1998; and
Asset tests:
(1) 75% asset test at the end of each quarter through
December 31, 1997;
(2) 25% asset test at the end of each quarter through
December 31, 1997;
(3) 10% asset test at the end of each quarter through
December 31, 1997; and
(4) 5% asset test at the end of each quarter through
December 31, 1997.
2. The Company's certificate, dated as of February 5, 1998.
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
persons, as defined for purposes of Section 856(a)(5) of the Code; and five or
fewer persons 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 person 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.
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.
<PAGE> 3
JDN Realty Corporation
3340 Peachtree Road
Suite 1530
Atlanta, Georgia 30326
February 5, 1998
Page 3
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, December 31, 1996 or December 31, 1997.
7. The representations contained in the Company's certificate, dated as of
February 5, 1998, 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 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 5% of the value of the total assets of
the Company.
On the basis of and in reliance on 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, December 31, 1996 and
December 31, 1997 and the Company's current organization and method of operation
will enable it to continue to meet the requirements for qualification and
taxation as a REIT under the Code; and
(b) the discussion in the Company's Form 8-K dated January 26, 1998
under the heading "Federal Income Tax and ERISA Considerations" and the
discussion in the Prospectus Supplement under the heading "Certain United States
Federal Income Tax Considerations" are correct in all material respects and
fairly summarize the federal income tax considerations that are likely to be
material to a holder of Notes.
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 shareholders, 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
<PAGE> 4
JDN Realty Corporation
3340 Peachtree Road
Suite 1530
Atlanta, Georgia 30326
February 5, 1998
Page 4
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
shareholders 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 "Federal Income Tax and ERISA Consideration" in the Company's Form 8-K
dated January 26, 1998, incorporated by reference into the Prospectus, and under
the caption "Legal Matters" in the Prospectus and the Prospectus Supplement.
Very truly yours,
/s/ Waller Lansden Dortch & Davis, PLLC
-----------------------------------------
WALLER LANSDEN DORTCH & DAVIS
A Professional Limited Liability Company
<PAGE> 1
EXHIBIT 25
===============================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM T-1
------------------------
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED,
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY
OF A TRUSTEE PURSUANT TO SECTION 305(b) (2) X
----
----------------------------
FIRST UNION NATIONAL BANK
(Exact name of Trustee as specified in its charter)
999 PEACHTREE STREET, N.E.
ATLANTA, GEORGIA 30309 58-1079889
(Address of principal (Zip Code) (I.R.S. Employer Identification No.)
executive office)
R. Douglas Milner
First Union National Bank
1100 First Union Plaza
999 Peachtree Street N.E.
Atlanta, Georgia 30309
(404) 827-7347
(Name, Address and Telephone Number of Agent for Service)
------------------------------
JDN REALTY CORPORATION
(Exact name of obligor as specified in its charter)
MARYLAND
(State or other jurisdiction of incorporation or organization)
58-1468053
(IRS employer identification no.)
3340 PEACHTREE ROAD, NE
SUITE 1530
ATLANTA, GEORGIA 30326
(404) 262-3252
(Name, address, including zip code, and telephone number, including
area code, of principal executive offices)
J. DONALD NICHOLS
JDN REALTY CORPORATION
3340 PEACHTREE ROAD, NE
SUITE 1530
ATLANTA, GEORGIA 30326
(404) 262-3252
------------------------------
$505,500,000
MEDIUM-TERM NOTES DUE NINE MONTHS OR MORE FROM DATE OF ISSUE
(Title of the indenture securities)
===============================================================================
<PAGE> 2
1. General information.
(a) The following are the names and addresses of each examining or
supervising authority to which the Trustee is subject:
The Comptroller of the Currency, Washington, D.C.
Federal Reserve Bank of Atlanta, Georgia.
Federal Deposit Insurance Corporation, Washington, D.C.
Securities and Exchange Commission, Division of Market Regulation,
Washington, D.C.
(b) The Trustee is authorized to exercise corporate trust powers.
2. Affiliations with obligor.
The obligor is not an affiliate of the Trustee. (See Note 2 on
Page 5)
3. Voting Securities of the Trustee.
The following information is furnished as to each class of voting
securities of the Trustee:
As of
- -------------------------------------------------------------------------------
Column A Column B
- -------------------------------------------------------------------------------
Title of Class Amount Outstanding
Common
- -------------------------------------------------------------------------------
Common Stock, par value $3.33 1/3 a share
4. Trusteeships under other indentures.
None.
5. Interlocking directorates and similar relationships with the obligor or
underwriters.
Neither the Trustee nor any of the directors or executive officers
of the Trustee is a director, officer, partner, employee, appointee or
representative of the obligor or of any underwriter for the obligor.
(See Note 2 on Page 5)
2
<PAGE> 3
6. Voting securities of the Trustee owned by the obligor or its officials.
Voting securities of the Trustee owned by the obligor and its
directors, partners and executive officers, taken as a group, do not
exceed one percent of the outstanding voting securities of the Trustee.
(See Notes 1 and 2 on Page 5)
7. Voting securities of the Trustee owned by underwriters or their officials.
Voting securities of the Trustee owned by any underwriter and
its directors, partners, and executive officers, taken as a group, do not
exceed one percent of the outstanding voting securities of the Trustee.
(See Notes 1 and 2 on Page 5)
8. Securities of the obligor owned or held by the Trustee.
The amount of securities of the obligor which the Trustee owns
beneficially or holds as collateral security for obligations in default
does not exceed one percent of the outstanding securities of the obligor.
(See Note 2 on Page 5)
9. Securities of underwriters owned or held by the Trustee.
The Trustee does not own beneficially or hold as collateral
security for obligations in default any securities of an underwriter for
the obligor.
(See Note 2 on Page 5)
10. Ownership or holdings by the Trustee of voting securities of certain
affiliates or security holders of the obligor.
The Trustee does not own beneficially or hold as collateral
security for obligations in default voting securities of a person, who, to
the knowledge of the Trustee (1) holds 10% or more of the voting securities
of the obligor or (2) is an affiliate, other than a subsidiary, of the
obligor.
(See Note 2 on Page 5)
11. Ownership or holdings by the Trustee of any securities of a person owning
50 percent or more of the voting securities of the obligor.
The Trustee does not own beneficially or hold as collateral
security for obligations in default any securities of a person who, to the
knowledge of Trustee, owns 50 percent or more of the voting securities of
the obligor.
(See Note 2 on Page 5)
3
<PAGE> 4
12. Indebtedness of the obligor to the Trustee.
Not applicable.
13. Defaults by the obligor.
Not applicable.
14. Affiliations with the underwriters.
No underwriter is an affiliate of the Trustee.
15. Foreign trustee.
Not applicable.
16. List of Exhibits.
(1) Articles of Association of the Trustee as now in effect. (See Exhibit
1 of the Form T-1 filed in connection with Registration Statement
No. 333-31863, which is incorporated herein by reference)
(2) Certificate of Authority of the Trustee to commence business. (See
Exhibit 2 of the Form T-1 filed in connection with Registration
Statement No. 333-31863, which is incorporated herein by reference)
(3) Authorization of the Trustee to exercise corporate trust powers.
Incorporated in Exhibit (4).
(4) By-Laws of the Trustee, as amended, to date. (See Exhibit 4 of
the Form T-1 filed in connection with Registration Statement No.
333-31863, which is incorporated herein by reference)
(5) Not applicable.
(6) Consent by the Trustee required by Section 321(b) of the Trust
Indenture Act of 1939. Included on Page 6 of this Form T-1 Statement.
(7) Most recent report of condition of the Trustee. (See Exhibit 7 of the
Form T-1 filed in connection with Registration Statement No.
333-31863, which is incorporated herein by reference)
(8) Not applicable.
(9) Not applicable.
4
<PAGE> 5
-----------------------
NOTES
-----------------------
1. Since the Trustee is a member of First Union Corporation, a bank
holding company, all of the voting securities of the Trustee are held by First
Union Corporation. The securities of First Union National Bank are described in
Item 3.
2. Inasmuch as this Form T-1 is filed prior to the ascertainment by
the Trustee of all facts on which to base responsive answers to Items 2, 5, 6,
7, 8, 9, 10 and 11, the answers to said Items are based on incomplete
information. Items 2, 5, 6, 7, 8, 9, 10 and 11 may, however be considered as
correct unless amended by an amendment to this Form T-1.
5
<PAGE> 6
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the Trustee, FIRST UNION NATIONAL BANK, a national association
organized and existing under the laws of the United States of America, has duly
caused this statement of eligibility and qualification to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Atlanta, and State of Georgia on the 5th day of February 1998.
FIRST UNION NATIONAL BANK
(Trustee)
BY: /s/ R. Douglas Milner
----------------------------------
R. Douglas Milner, Vice President
6
<PAGE> 7
EXHIBIT T-1 (6)
CONSENT OF TRUSTEE
Under section 321(b) of the Trust Indenture Act of 1939 and in
connection with the proposed issuance of Medium-Term Notes Due Nine Months or
More From Date of JDN Realty Corporation, First Union National Bank, as the
Trustee herein named, hereby consents that reports of examinations of said
Trustee by Federal, State, Territorial or District authorities may be furnished
by such authorities to the Securities and Exchange Commission upon requests
therefor.
FIRST UNION NATIONAL BANK
BY: /s/ R. Douglas Milner
-----------------------------------
Dated: February 5, 1998 R. Douglas Milner, Vice President
7
