<PAGE> 1
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------------
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 10, 1998
------------------------------
JDN Realty Corporation
(Exact Name of Registrant as Specified in Its Charter)
Maryland 1-12844 58-1468053
(State or Other (Commission File (I.R.S. Employer
Jurisdiction of Number) Identification
Incorporation) Number)
359 East Paces Ferry Road
Suite 400
Atlanta, Georgia 30305
(Address of Principal Executive Offices) (Zip Code)
(404) 262-3252
(Registrant's Telephone Number, including Area Code)
Not Applicable
(Former Name)
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<PAGE> 2
Item 5. Other Events.
Common Stock Offering. On November 4, 1998, the Company entered into a
terms agreement with SunTrust Equitable Securities Corporation (the
"Underwriter") relating to the sale by the Company to the Underwriter of 717,500
shares of the Company's common stock, par value $.01 per share (the "Common
Stock"), at a price of $21.25 per share. The related Underwriting Agreement,
dated July 30, 1997, was filed as an exhibit to the Company's Current Report on
Form 8-K filed on August 1, 1997. This offering closed on November 10, 1998.
A registration statement relating to the Common Stock has been filed
with the Securities and Exchange Commission (the "Commission") and was declared
effective on October 30, 1997.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
Exhibit No. Description
----------- -----------
1 Terms Agreement dated November 4, 1998 by and between the Company
and SunTrust Equitable Securities Corporation, and related
Underwriting Agreement (Underwriting Agreement filed as Exhibit
1.1 to the Company's Current Report on Form 8-K filed on August 1,
1997 and incorporated herein by reference)
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)
<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: November 9, 1998
<PAGE> 4
INDEX TO EXHIBITS
Exhibit No. Description
----------- -----------
1 Terms Agreement dated November 4, 1998 by and between the Company
and SunTrust Equitable Securities Corporation, and related
Underwriting Agreement (Underwriting Agreement filed as Exhibit
1.1 to the Company's Current Report on Form 8-K filed on August 1,
1997 and incorporated herein by reference)
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)
<PAGE> 1
EXHIBIT 1
JDN REALTY CORPORATION
(a Maryland corporation)
717,500 Shares of Common Stock, par value $.01 per share
TERMS AGREEMENT
Dated: November 4, 1998
To: JDN Realty Corporation
359 E. Paces Ferry Road
Suite 400
Atlanta, GA 30305
Ladies and Gentlemen:
We (the "Underwriters") understand that JDN Realty Corporation (the
"Company") proposes to issue and sell shares of Common Stock, par value $.01 per
share (the "Common Stock" or "Underwritten Securities"). Subject to the terms
and conditions set forth or incorporated by reference herein, the Underwriters
offer to purchase the Initial Underwritten Securities (as defined in the
Underwriting Agreement referred to below) set forth below and the Option
Underwritten Securities (as defined in the Underwriting Agreement referred to
below) to the extent any are purchased, at the purchase price per share of
Common Stock set forth below.
<TABLE>
<CAPTION>
Underwriter Number of Shares of Initial
Underwritten Securities
<S> <C>
SunTrust Equitable Securities Corporation..................................................717,500
Total.....................................................................717,500
</TABLE>
The Underwritten Securities shall have the following terms:
TITLE OF SECURITIES: Common Stock
NUMBER OF INITIAL UNDERWRITTEN SECURITIES: 717,500
PAR VALUE: $.01 per share of Common Stock
PUBLIC OFFERING PRICE PER SHARE OF COMMON STOCK: $21.25
PURCHASE PRICE PER SHARE OF COMMON STOCK: $20.94
NUMBER OF OPTION UNDERWRITTEN SECURITIES, IF ANY, THAT MAY BE PURCHASED BY THE
UNDERWRITERS: None.
DELAYED DELIVERY CONTRACTS: Not authorized
LOCK-UP AGREEMENT: In accordance with Section 3(k) of the Underwriting Agreement
(incorporated herein by reference), the Company shall not, without the
prior written
<PAGE> 2
consent of the Underwriters (which consent shall not be unreasonably
withheld), directly or indirectly, issue, sell, offer to sell, grant any
option for the sale of, or otherwise dispose of Common Stock or any
security convertible into or exercisable or exchangeable for Common Stock
for a period of 30 days from the date hereof. Notwithstanding the
foregoing, during such period, without obtaining the Underwriter's consent,
the Company may issue, sell, offer to sell, grant any option for the sale
of or otherwise dispose of shares of Common Stock in connection with (i)
the Company's Dividend Reinvestment and Stock Purchase Plan, (ii) the
Company's Employee Stock Purchase Plan, (iii) the Company's 1993 Incentive
Stock Plan and (iv) the Company's Non-Employee Director Stock Option Plan.
CLOSING DATE AND LOCATION: November 10, 1998, Hogan & Hartson L.L.P., Columbia
Square, 555 Thirteenth Street, N.W., Washington, DC 20004
All the provisions contained in the document attached as Annex A hereto
entitled "JDN Realty Corporation (a Maryland corporation) -- Common Stock,
Common Stock Warrants, Preferred and Debt Securities -- Underwriting Agreement,"
dated July 30, 1997 (the "Underwriting Agreement"), are hereby incorporated by
reference in their entirety herein and, subject to any modifications to such
terms set forth below, shall be deemed to be a part of this Terms Agreement to
the same extent as if such provisions had been set forth in full herein. In
furtherance of the foregoing, certain provisions of the Underwriting Agreement
hereby are modified as follows:
(a) by deleting the reference to "$400 million" in the first paragraph
thereof and by inserting "$600 million" in lieu thereof;
(b) by deleting the reference to "(No. 333-22339)" contained in the
first sentence of the eighth paragraph thereof in its entirety and to insert
"(No. 333-38611, or any successor thereto)" in lieu thereof;
(c) by deleting the phrase "prior to the execution of this
Underwriting Agreement" in the 19th line of the eighth paragraph thereof and by
inserting "as of the date of such Registration Statement or Prospectus, as the
case may be, and all references to the `Prospectus' shall be deemed to include
all documents incorporated by reference therein prior to the termination of the
offering of the Underwritten Securities by the Underwriters" in lieu thereof;
(d) by deleting each reference to "Merrill Lynch & Co., Merrill
Lynch, Pierce, Fenner & Smith Incorporated" and "Merrill Lynch" therein and by
inserting "SunTrust Equitable Securities Corporation" in lieu thereof;
(e) by deleting Paragraph (4) ("Financial Statements") of Section 1
thereof in its entirety and by inserting in lieu thereof the following:
(4) 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
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<PAGE> 3
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 and are in conformity with the
requirements of Rule 3-14 of Regulation S-X promulgated under the 1933
Act; 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, 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. No
other financial statements are required to be set forth or to be
incorporated by reference in the Registration Statement or the
Prospectus under the 1933 Act or the 1933 Act Regulations;
(f) by deleting Paragraph (7) ("Good Standing of Subsidiaries") of
Section 1 thereof in its entirety and by inserting in lieu thereof the
following:
(7) Good Standing of Significant Subsidiaries. Each
significant subsidiary (as such term is defined in Rule 1-02 of
Regulation S-X promulgated under the 1933 Act), if any, and JDN
Development (each, a "Significant Subsidiary") has been duly organized
and is validly existing and 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 to 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, the outstanding voting common stock of which is owned 99%
by J. Donald Nichols and 1% by the Company, and the outstanding
non-voting common
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<PAGE> 4
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;
(g) by deleting Paragraph (8) ("Capitalization") of Section 1 thereof
in its entirety and by inserting in lieu thereof the following:
(8) Capitalization. The Company has authorized, issued and
outstanding stock as set forth in the Company's Quarterly Report on
Form 10-Q filed with the Commission for the period ended September 30,
1998 (except for subsequent issuances of Common Stock pursuant to the
Company's Dividend Reinvestment and Stock Purchase Plan, 1995 Employee
Stock Purchase Plan, 1993 Incentive Stock Plan and 1993 Non-Employee
Director Stock Option Plan). Such shares of capital stock have been
duly authorized and validly issued by the Company and are fully paid
and non-assessable, and none of such shares of capital stock was issued
in violation of preemptive or other similar rights of any
securityholder of the Company;
(h) by deleting Paragraph (23) ("Absence of Further Requirements") of
Section 1 thereof in its entirety and by inserting in lieu thereof the
following:
(23) Absence of Further Requirements. No filing with, or
authorization, approval, consent, license, order registration,
qualification or decree of, any court or governmental authority or
agency is necessary or required for the performance by the Company of
its obligations under this Underwriting Agreement or the applicable
Terms Agreement or in connection with the transactions contemplated
under this Underwriting Agreement, such Terms Agreement or any
applicable Indenture or Warrant Agreement, except for the registration
of the Underwritten Securities under the 1933 Act or under state
securities laws, compliance with the listing requirements of the New
York Stock Exchange, or approval of the National Association of
Securities Dealers, Inc., if applicable, all of which have been or will
be effected in accordance with this Agreement;
(i) by deleting Paragraph (26) ("Title to Property") of Section 1
thereof in its entirety and by inserting in lieu thereof the following:
(26) Title to Property. The Company and its Subsidiaries have
good and marketable title to all of the properties and assets reflected
in the financial statements (or as described in or incorporated by
reference into the Registration Statement or Prospectus), 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. Except as described in or incorporated by reference into
the Registration Statement or the Prospectus, and except with respect
to other Properties that, singly or in the aggregate, did not
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<PAGE> 5
account for more than either (i) 10 percent of the total assets on the
Company's December 31, 1997 or September 30, 1998 consolidated balance
sheets or (ii) 10 percent of the Company's total revenues on the
Company's consolidated statements of income for the year ended December
31, 1997 or the nine months ended September 30, 1998, no person has an
option or right of first refusal to purchase all or part of any
Property or any interest therein. 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 Subsidiary 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 the leases or subleases mentioned above, 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;
(j) by deleting Paragraph (27) ("Leases") of Section 1 thereof in its
entirety and by inserting in lieu thereof the following:
(27) Leases. Each lease of real property by the Company as
lessor is the legal, valid and binding obligation of the lessee in
accordance with the terms of such lease (except for such leases as are
not material to the business of the Company and except that the remedy
of specific performance and injunctive and other forms of equitable
relief may be subject to equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought and to
the Federal Bankruptcy Code). The rents with respect to the Properties
which at present are or remain due and unpaid for more than 30 days are
not payable under leases such that, were no further rental payments to
be received by the Company under such leases, there would result a
Material Adverse Effect. Except as disclosed in or incorporated by
reference into the Prospectus and except as would not have a Material
Adverse Effect, the Company has no knowledge that any tenant which is
responsible for aggregate annualized base rent in excess of $1,200,000
under all of its leases at the Properties is not financially capable of
performing its obligations thereunder. The Company occupies its leased
properties under valid and binding leases conforming in all material
respects to any description thereof set forth in or incorporated by
reference into the Registration Statement or Prospectus;
(k) by deleting the word "and" in the 31st line of Paragraph (30)
("Environmental Laws") of Section 1 thereof and by inserting the following in
the 34th line thereof after the comma and before the word "the:"
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;
(l) by renumbering Paragraph (32) ("Tax Compliance") of Section 1
thereof as Paragraph (31) and by adding in the eighth line of such Paragraph
after the word "paid" and before the comma the following: "except where failure
to pay would not result in a Material Adverse Effect";
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<PAGE> 6
(m) by deleting the references to "signed" in the third and sixth lines
of Paragraph (c) of Section 3 thereof and by inserting "conformed" in lieu
thereof; and
(n) by deleting the words "Merrill Lynch at World Financial Center,
North Tower, New York, New York 10281-1201 attention of: Tjarda Clagett,
Director" in the second sentence of Section 11 thereof and by inserting the
words "SunTrust Equitable Securities Corporation, 800 Nashville City Center,
Nashville, Tennessee 37219, Attention: Equity Syndicate" in lieu thereof.
The Company represents and warrants to the Underwriters that the
representations and warranties of the Company set forth in Section 1 of the
Underwriting Agreement, as modified in the preceding paragraphs, are accurate as
though expressly made at and as of the date hereof.
The parties hereto agree and acknowledge that the information set forth
in the third paragraph under the caption "Underwriting" in the Prospectus
Supplement dated November 4, 1998 constitutes the only information furnished by
the Underwriters to the Company for inclusion in the Registration Statement and
the Prospectus.
Except as otherwise defined herein, terms defined in the Underwriting
Agreement are used herein as therein defined.
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<PAGE> 7
Please accept this offer no later than 5:00 p.m. (New York City time)
on November 4, 1998 by signing a copy of this Terms Agreement in the space set
forth below and returning the signed copy to us.
Very truly yours,
SUNTRUST EQUITABLE SECURITIES CORPORATION
By: /s/ John C. Burch Jr.
---------------------------------------
Name: John C. Burch Jr.
Title: Managing Director
Accepted:
By: JDN REALTY CORPORATION
By: /s/ William J. Kerley
------------------------------
Name: William J. Kerley
Title: CFO
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<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
FACSIMILES (615) 244-6380 809 SOUTH MAIN STREET
(615) 244-6804 P. O. BOX 1035
(615) 244-5686 COLUMBIA, TN 38402-1035
(615) 388-6031
November 10, 1998
JDN Realty Corporation
359 East Paces Ferry Road, Suite 400
Atlanta, Georgia 30305
Re: JDN REALTY CORPORATION - PROSPECTUS SUPPLEMENT DATED NOVEMBER
4, 1998 (TO THE PROSPECTUS DATED OCTOBER 30, 1997)
Ladies and Gentlemen:
We are acting as your counsel in connection with the issue and sale of
717,500 shares of common stock, $.01 par value (the "Shares"), by JDN Realty
Corporation, a Maryland corporation (the "Company"), to SunTrust Equitable
Securities Corporation (the "Underwriter"), pursuant to a Registration Statement
on Form S-3 (Registration No. 333-38611) (the "Registration Statement"),
including the Prospectus dated October 30, 1997 contained therein (the
"Prospectus") as supplemented by the Prospectus Supplement dated November 4,
1998 (the "Prospectus Supplement"), a Terms Agreement between the Company and
the Underwriter dated November 4, 1998 and the related Underwriting Agreement,
dated July 30, 1997 (collectively, the "Underwriting Agreement").
As such counsel and in connection with the foregoing, we have examined
and relied upon such records, documents and other instruments as in our judgment
are necessary or appropriate in order to express the opinion hereinafter set
forth, and have assumed the genuineness of all signatures, the authenticity of
all documents submitted to us as originals, and the conformity to original
documents of all documents submitted to us as certified or photostatic copies.
Based upon and subject to the foregoing and such other matters as we
have deemed relevant, we are of the opinion that the Shares have been duly
authorized by all necessary corporate action and, when delivered and issued upon
payment therefor in the manner and on the terms described in the Registration
Statement, the Prospectus, the Prospectus Supplement and the Underwriting
Agreement, will be validly issued, fully paid and non-assessable.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and further consent to the reference to us under the
caption "Legal Matters" in the Prospectus and the Prospectus Supplement.
Very truly yours,
/s/ Waller Lansden Dortch & Davis, 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
FACSIMILES (615) 244-6380 809 SOUTH MAIN STREET
(615) 244-6804 P. O. BOX 1035
(615) 244-5686 COLUMBIA, TN 38402-1035
(615) 388-6031
November 10, 1998
JDN Realty Corporation
359 East Paces Ferry Road
Suite 400
Atlanta, Georgia 30305
RE: JDN REALTY CORPORATION - PROSPECTUS SUPPLEMENT DATED NOVEMBER
4, 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 issue and sale of
717,500 shares of Common Stock, par value $.01 per share (the "Shares"), under
the terms of the Underwriting Agreement, dated July 30, 1997, and the related
Terms Agreement, dated November 4, 1998, (the "Agreement"), by and between the
Company and SunTrust Equitable Securities Corporation, a Tennessee corporation
(the "Underwriter"). In connection with the issue and sale of the Shares, you
have requested our opinion as to certain federal income tax matters.
All capitalized terms used herein, unless specifically indicated
otherwise, shall have the respective meanings set forth in the Agreement. All
section references herein, unless otherwise specified, are to the Internal
Revenue Code of 1986, as amended (the "Code").
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
ending December 31, 1994 and for the taxable years ending 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
November 10, 1998
Page 2
(b) Compliance with the applicable REIT ratios or tests for
the taxable years ending December 31, 1994, 1995, 1996 and 1997 and projected
compliance with such tests for the taxable 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 taxable year ending December 31, 1998;
and
Asset tests:
(1) 75% asset test at the end of each quarter
through September 30, 1998;
(2) 25% asset test at the end of each quarter
through September 30, 1998;
(3) 10% asset test at the end of each quarter
through September 30, 1998; and
(4) 5% asset test at the end of each quarter
through September 30, 1998.
2. The Company's certificate, dated as of November 10, 1998. With
respect to such certificate, we assume that any certifications as to the
Company's belief (or similar qualification) are in fact accurate and true.
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 has owned, directly or indirectly, over 8% in number of
shares or value of the outstanding stock or of any class of 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.
<PAGE> 3
JDN Realty Corporation
November 10, 1998
Page 3
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 Treasury Regulations thereunder.
3. Additional properties acquired will constitute "real estate assets"
and any other investments made by the Company will be made in a manner to
satisfy the asset tests of Section 856(c) of the Code.
4. The income from existing and additional leases entered into or
acquired and the income from other investments will not cause the Company to
fail to satisfy the income tests of Section 856(c) of the Code.
5. The Company will actually operate in accordance with its past and
proposed method of operation as described in its filings with the Securities and
Exchange Commission under the Securities Act of 1933 and the Securities Exchange
Act of 1934.
6. The Company had no undistributed "C" corporation earnings and
profits at December 31, 1994, December 31, 1995, December 31, 1996 or December
31, 1997.
7. The representations contained in the Company's certificate, dated as
of November 10, 1998, are accurate and true.
8. All partnerships in which the Company may have an ownership interest
will own only "real estate assets" and cash reserves. All activities of those
partnerships will consist of activities permitted to be undertaken by a REIT and
income, other than interest income on cash reserves, shall be "rents from real
property."
9. Each corporation in which the Company has acquired or acquires an
equity interest shall either be a "qualified REIT subsidiary" under Section
856(i) of the Code or the Company will not own over ten percent (10%) of the
outstanding voting securities of such corporation or other issuer and the
securities owned of such issuer will not be greater in value than five percent
(5%) of the value of the total assets of the Company.
On the basis of and in reliance 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 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
<PAGE> 4
JDN Realty Corporation
November 10, 1998
Page 4
operation will enable it to continue to meet the requirements for qualification
and taxation as a REIT under the Code.
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
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.
This opinion is furnished only for your benefit in connection with the
issue and sale of the Shares and, without our prior written consent, may not be
quoted (in whole or in part) or relied on for any other purpose or by any other
person or entity.
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 Prospectus Supplement.
Very truly yours,
/s/ WALLER LANSDEN DORTCH & DAVIS
A Professional Limited Liability Company
