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EXHIBIT 1
JDN REALTY CORPORATION
(a Maryland corporation)
850,000 shares of Common Stock, par value $.01 per share
TERMS AGREEMENT
Dated: October 13, 1998
To: JDN Realty Corporation
000 X. Xxxxx Xxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
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.
Number of Shares of Initial
Underwriter Underwritten Securities
----------- -----------------------
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated..........................................................850,000
-------
Total.................................................................850,000
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The Underwritten Securities shall have the following terms:
TITLE OF SECURITIES: Common Stock
NUMBER OF INITIAL UNDERWRITTEN SECURITIES: 850,000
PAR VALUE: $.01 per share of Common Stock
PUBLIC OFFERING PRICE PER SHARE OF COMMON STOCK: $20.6875
PURCHASE PRICE PER SHARE OF COMMON STOCK: $19.6275
NUMBER OF OPTION UNDERWRITTEN SECURITIES, IF ANY, THAT MAY BE PURCHASED BY THE
UNDERWRITERS: 127,500
DELAYED DELIVERY CONTRACTS: Not authorized
ADDITIONAL CO-MANAGERS, IF ANY: None
LOCK-UP AGREEMENT: In accordance with Section 3(k) of the Underwriting
Agreement (incorporated herein by reference), the Company will not,
without the prior written
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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, (iv) the Company's
Non-Employee Director Stock Option Plan and (v) upon prior notice to
the Underwriters, the issuance, sale and delivery to SunTrust Equitable
Securities Corporation of Common Stock with a fair market value of up
to $50 million in connection with a firm commitment offering limited to
institutional investors.
CLOSING DATE AND LOCATION: October 19, 0000, Xxxxx & Xxxxxxx X.X.X., Xxxxxxxx
Square, 000 Xxxxxxxxxx Xxxxxx, X.X., Xxxxxxxxxx, XX 00000
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 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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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;
(e) 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. Xxxxxx Xxxxxxx and 1% by the Company, and the outstanding
non-voting common
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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;
(f) 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 June 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;
(g) 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;
(h) 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 with respect to other
Properties that, singly or in the aggregate, did not account for
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more than either (i) 10 percent of the total assets on the Company's
December 31, 1997 or June 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 six months ended June 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;
(i) 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;
(j) 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;
(k) 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"; and
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(l) 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.
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 last paragraph on the cover page and in the third paragraph under the
caption "Underwriting" in the Prospectus Supplement dated October 13, 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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Please accept this offer no later than 5:00 p.m. (New York City time)
on October 13, 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,
XXXXXXX XXXXX & CO.
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By: XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
By: /s/ Xxxxxx Xxxxxxx
------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Director
Accepted:
By: JDN REALTY CORPORATION
By: /s/ Xxxx X. Xxxxxx, Xx.
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Name: Xxxx X. Xxxxxx, Xx.
Title: Vice President
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