MERRY LAND & INVESTMENT COMPANY, INC.
Debt Securities
Underwriting Agreement
July 23, 1997
To the Representatives named
in Schedule I hereto of the
Underwriters named in
Schedule II hereto
Dear Sirs:
Merry Land & Investment Company, Inc., a Georgia corporation (the "Company"),
proposes to issue and sell to the underwriters named in Schedule II hereto
(the "Underwriters"), for whom you are acting as representatives (the
"Representatives"), the principal amount of its debt securities identified
in Schedule I hereto (the "Securities"), to be issued under the indenture
specified in Schedule I hereto (the "Indenture") between the Company and the
Trustee identified in such Schedule (the "Trustee"). If the firm or firms
listed in Schedule II hereto include only the firm or firms listed in
Schedule I hereto, then the terms "Underwriters" and "Representatives", as
used herein, shall each be deemed to refer to such firm or firms.
The Company has prepared and filed with the Securities and Exchange
Commission (the "Commission") in accordance with the provisions of Securities
Act of 1933, as amended, and the rules and regulations of the Commission
thereunder (collectively, the "Securities Act"), a registration statement
(the file number of which is set forth in Schedule I hereto) on Form S-3,
relating to certain securities (the "Shelf Securities") to be issued from
time to time by the Company. The Company also has filed with, or proposes to
file with, the Commission pursuant to Rule 424 under the Securities Act a
prospectus supplement specifically relating to the Securities. The registration
statement as amended to the date of this Agreement is hereinafter referred to
as the "Registration Statement" and the related prospectus covering the Shelf
Securities in the form first used to confirm sales of the Securities is
hereinafter referred to as the "Basic Prospectus". The Basic Prospectus as
supplemented by the prospectus supplement specifically relating to the
Securities in the form first used to confirm sales of the Securities is
hereinafter referred to as the "Prospectus". Any reference in this Agreement
to the Registration Statement, the Basic Prospectus, any preliminary form of
Prospectus (a "preliminary prospectus") previously filed with the Commission
pursuant to Rule 424 or the Prospectus shall be deemed to refer to and include
the documents incorporated by reference therein pursuant to Item 12 of Form S-3
under the Securities Act which were filed under the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively, the "Exchange Act") on or before the date of this Agreement or
the date of the Basic Prospectus, any preliminary prospectus or the Prospectus,
as the case may be; and any reference to "amend", "amendment" or "supplement"
with respect the Registration Statement, the Basic Prospectus, any
preliminary prospectus or the Prospectus shall be deemed to refer to and
include any documents filed under the Exchange Act after the date of this
Agreement, or the date of the Basic Prospectus, any preliminary prospectus or
the Prospectus, as the case may be, which are deemed to be incorporated by
reference therein.
The Company hereby agrees with the Underwriters as follows:
1. The Company agrees to issue and sell the Securities to the several
Underwriters as hereinafter provided, and each Underwriter, on the basis
of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agrees to purchase, severally and
not jointly, from the Company the respective principal amount of
Securities set forth opposite such Underwriter's name in Schedule II
hereto at the purchase price set forth in Schedule I hereto plus
accrued interest, if any, from the date specified in Schedule I hereto to the
date of payment and delivery.
2. The Company understands that the several Underwriters intend (i) to make
a public offering of their respective portions of the Securities and (ii)
initially to offer the Securities upon the terms set forth in the Prospectus.
3. Payment for the Securities shall be made to the Company or to its order
in immediately available funds on the date and at the time and place set forth
in Schedule I hereto (or at such other time and place on the same or such other
date, not later than the third Business Day thereafter, as you and the Company
may agree in writing). Such payment will be made upon delivery to, or to
you for the respective accounts of, such Underwriters of the Securities
registered in such names and in such denominations as you shall request not
less than two full Business Days prior to the date of delivery, with any
transfer taxes payable in connection with transfer to the Underwriters duly paid
by the Company. As used herein, the term "Business Day" means any day other
than a day on which banks are permitted or required to be closed in New York
City. The time and date of such payment and delivery with respect to the
Securities are referred to herein as the Closing Date. The certificates for
the Securities will be made available for inspection and packaging by you by
1:00 P.M. on the Business Day prior to the Closing Date at such place in New
York City as you and the Company shall agree.
4. The Company represents and warrants to each Underwriter that:
(a) the Registration Statement has been declared effective by the
Commission under the Securities Act; no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceeding for that
purpose has been instituted or, to the knowledge of the Company, threatened
by the Commission; and the Registration Statement and Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) comply, or will comply, as the case may be, in all material respects
with the Securities Act and the Trust Indenture Act of 1939, as amended,
and the rules and regulations of the Commission thereunder (collectively, the
"Trust Indenture Act"), and do not and will not, as of the applicable effective
date as to the Registration Statement and any amendment thereto and as of the
date of the Prospectus and any amendment or supplement thereto, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading,
and the Prospectus, as amended or supplemented at the Closing Date, if
applicable, will not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; except that the fo
regoing representations and warranties shall not apply to (i)
that part of the Registration Statement which constitutes the Statement of
Eligibility and Qualification (Form T-1) under the Trust Indenture Act of the
Trustee, and (ii) statements or omissions in the Registration Statement or the
Prospectus made in reliance upon and in conformity with information relating to
any Underwriter furnished to the Company in writing by such Underwriter through
the Representatives expressly for use therein;
(b) the documents incorporated by reference in the Prospectus, when
they were filed with the Commission, conformed in all material respects to the
requirements of the Exchange Act, and none of such documents contained an
untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; and any further documents so filed
and incorporated by reference in the Prospectus, when such documents are
filed with the Commission will conform in all material respects to the
requirements of the Exchange Act, as applicable, and will not contain an untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading;
(c) the consolidated financial statements and the related notes
thereto, included or incorporated by reference in the Registration Statement and
the Prospectus, present fairly the financial position of the Company and its
Subsidiaries as of the dates indicated and the consolidated results of its
operations and the changes in its cash flows for the periods
specified; the financial statements with respect to the properties acquired or
to be acquired by the Company, together with related notes and schedules as set
forth or incorporated by reference in the Registration Statement or the
Prospectus, present fairly the financial position and the results of operations
of such properties at the indicated dates and for the indicated periods; the
foregoing financial statements have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis, and the
supporting schedules included or incorporated by reference in the Registration
Statement or the Prospectus present fairly the information required to be
stated therein; the summary financial and statistical data included or
incorporated by reference in the Registration Statement or the Prospectus
present fairly the information shown therein and have been compiled on a basis
consistent with the financial statements presented therein; and the pro forma
financial information, and the related notes thereto, included or incorporated
by reference in the Registration Statement and the Prospectus has been prepared
in accordance with the applicable requirements of the Securities Act and the
Exchange Act, as applicable;
(d) since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the general affairs, business, prospects, management,
properties, financial position, stockholders' equity or results of operations
of the Company, otherwise than as set forth or contemplated in the Prospectus;
and except as set forth or contemplated in the Prospectus the Company has not
entered into any transaction or agreement (whether or not in the ordinary
course of business) material to the Company;
(e) the Company has been duly incorporated and is validly existing
as a corporation in good standing under the laws of the state of its
incorporation, with power and authority (corporate and other) to own or lease
its properties and conduct its business as described in the Prospectus, and has
been duly qualified as a foreign corporation for the transaction of business
and is in good standing under the laws of each other jurisdiction in which it
owns or leases properties, or conducts any business, so as to require such
qualification, other than where the failure to be so qualified or in good
standing would not have a material adverse effect on the Company and its
subsidiaries taken as a whole; except for investments in securities as
described in the Registration Statement or Prospectus, the Company has no
equity or other interest in, or rights to acquire, an equity or other interest
in any corporation, partnership, trust or other entity; the subsidiary
entities of the Company identified on Schedule III hereto (the "Subsidiaries")
have been duly organized and are validly existing as corporations or limited
partnerships, as the case may be, in good standing under the laws of their
states of organization, and have been duly qualified as foreign
corporations or limited partnerships, as the case may be, for the transaction
of business and are in good standing under the laws of each other jurisdiction
in which they own or lease properties, or conduct any business, so as to
require such qualification, other than where the failure to be so qualified or
in good standing would not have a material adverse effect on the Company and
its Subsidiaries taken as a whole; except for investments in securities as
described in the Registration Statement or Prospectus, the Company and the
Subsidiaries have no equity or other interest in, or rights to acquire, an
equity or other interest in any corporation, partnership, trust or other entity;
(f) this Agreement and the Indenture have been duly authorized,
executed and delivered by the Company and constitute the valid and legally
binding obligations of the Company enforceable in accordance with their terms,
except as rights to indemnity and contribution hereunder may be limited by
applicable law;
(g) the Securities have been duly authorized, and, when issued,
authenticated and delivered pursuant to this Agreement and the Indenture will
have been duly and validly executed, authenticated, issued and delivered and
will constitute valid and binding obligations of the Company entitled to the
benefits provided by the Indenture; the Indenture has
been duly authorized and has been duly qualified under the Trust Indenture Act
and, when executed and delivered by the Company and the Trustee, the Indenture
will constitute a valid and binding instrument; and the Securities and the
Indenture will conform to the statements relating thereto contained in the
rospectus;
(h) neither the Company nor the Subsidiaries is, nor with the giving
of notice or lapse of time or both would be, in violation of or in default
under, their respective Articles of Incorporation or By-Laws or any indenture,
mortgage, deed of trust, loan agreement or other agreement or other instrument
or obligation to which the Company or any Subsidiary s a party or by which they
or any of their properties are bound, except for violations and
defaults which individually and in the aggregate are not material to the
Company or to the holders of the Securities; the issue and sale of the
Securities and the performance by the Company of all of the provisions of its
obligations under the Securities, the Indenture and this Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument to which the Company or any
Subsidiary is a party or by which the Company or any Subsidiary is bound or to
which any of the property or assets of the Company or any Subsidiary is
subject, nor will any such action result in any violation of the provisions of
the Articles of Incorporation or the By-Laws of the Company or any applicable
law or statute or any order, rule or regulation of any court or governmental
agency or body having jurisdiction over the Company or any of its properties;
and no consent, approval, authorization, order, registration or qualification
of or with any such court or governmental agency or body is required for the
issue and sale of the Securities or the consummation by the Company of the
transactions contemplated by this Agreement or the Indenture, except such
consents, approvals, authorizations, registrations or qualifications as have
been obtained under the Securities Act, the Trust Indenture Act and as may be
required under state securities or Blue Sky Laws in connection with the
purchase and distribution of the Securities by the Underwriters;
(i) other than as set forth or contemplated in the Prospectus, there
are no legal or governmental proceedings pending or, to the knowledge of the
Company, threatened to which the Company or any Subsidiary is or may be a party
or to which any property of the Company or any Subsidiary is or may be the
subject which, if determined adversely to the Company, could individually or in
the aggregate reasonably be expected to have a material adverse effect on the
general affairs, business, prospects, management, properties, financial
position, stockholders' equity or results of operations of the Company and, to
the best of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others; and there are
no contracts or other documents of a character required to be filed as an
exhibit to the Registration Statement or required to be described in the
Registration Statement or the Prospectus which are not filed or described as
required;
(j) the Company and the Subsidiaries have good and marketable title
to all of the properties and assets reflected in the financial statements (or
as described in the Registration Statement) hereinabove described, subject to
no lien, mortgage, pledge, charge or encumbrance of any kind except those
reflected in such financial statements (or as described in the Registration
Statement) or which are not material in amount. The Company and the
Subsidiaries occupy their leased properties under valid and binding leases
conforming to the description thereof set forth in the Registration Statement;
(k) the Company has filed all Federal, State and foreign income tax
returns which have been required to be filed and have paid all taxes indicated
by said returns and all assessments received by it to the extent that such
taxes have become due and are not being contested in good faith;
(l) the Company and the Subsidiaries hold all material licenses,
certificates and permits from governmental authorities which are necessary to
the conduct of its business; and the Company has not infringed any patents,
patent rights, trade names, trademarks or copyrights, which infringement is
material to the business of the Company;
(m) Xxxxxx Xxxxxxxx LLP, who have certified certain of the
financial statements filed with the Commission as part of, or incorporated by
reference in, the Registration Statement, are independent public accountants
as required by the Securities Act;
(n) the Company has never been, is not now, and immediately after
the sale of the Securities under this Agreement will not be, an "investment
company" within the meaning of the Investment Company Act of 1940, as amended;
(o) with respect to all tax periods regarding which the Internal
Revenue Service is or will be entitled to assert any claim, the Company has
met the requirements for qualification as a real estate investment trust under
Sections 856 through 860 of the Internal Revenue Code, as amended, and the
Company's present and contemplated operations, assets and income continue to
meet such requirements; and
(p) the conditions for the use of a registration statement on Form
S-3 set forth in the General Instructions on Form S-3 have been satisfied and
the Company is entitled to use such form for the transactions contemplated
herein.
5. The Company covenants and agrees with the several Underwriters as
follows:
(a) to file the Prospectus in a form approved by you pursuant to
Rule 424 under the Securities Act not later than the Commission's close of
business on the second Business Day following the date of determination of the
offering price of the Securities;
(b) to deliver to each Representative and counsel for the
Underwriters, at the expense of the Company, a signed copy of the Registration
Statement (as originally filed) and each amendment thereto, in each case
including exhibits and documents incorporated by reference therein and, during
the period mentioned in paragraph (e) below, to each of the Underwriters as
many copies of the Prospectus (including all amendments and supplements
thereto) and documents incorporated by reference therein as you may reasonably
request, when filed with Commission.
(c) from the date hereof and prior to the Closing Date, to furnish
to you a copy of any proposed amendment or supplement to the Registration
Statement or the Prospectus, for your review, and not to file any such
proposed amendment or supplement to which you reasonably object;
(d) to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act for so long
as the delivery of a prospectus is required in connection with the offering or
sale of the Securities, and during such same period, to advise you promptly,
and to confirm such advice in writing, (i) when any amendment to the
Registration Statement shall have become effective, (ii) of any request by the
Commission for any amendment to the Registration Statement or any amendment
or supplement to the Prospectus or for any additional information, (iii) of
the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the initiation or threatening of any
proceeding for that purpose, and (iv) of the receipt by the Company of any
notification with respect to any suspension of the qualification of the
Securities for offer and sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and to use its best efforts to
prevent the issuance of any such stop order or notification and, if issued, to
obtain as soon as possible the withdrawal thereof;
(e) if, during such period after the first date of the public
offering of the Securities as in the opinion of counsel for the Underwriters a
prospectus relating to the Securities is required by law to be delivered in
connection with sales by an Underwriter or dealer, any event shall occur as a
result of which it is necessary to amend or supplement the Prospectus
in order to make the statements therein, in the light of the circumstances when
the Prospectus is delivered to a purchaser, not misleading, or if it is
necessary to amend or supplement the Prospectus to comply with law, forthwith
to prepare and furnish, at the expense of the Company, to the Underwriters
and to the dealers (whose names and addresses you will furnish to the
Company) to which Securities may have been sold by you on behalf of the
Underwriters and to any other dealers upon request, such amendments or
supplements to the Prospectus as may be necessary so that the statements in
the Prospectus as so amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser, be misleading
or so that the Prospectus will comply with law;
(f) to endeavor to qualify the Securities for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall reasonably
request and to continue such qualification in effect so long as reasonably
required for distribution of the Securities and to pay all fees and expenses
(including fees and disbursements of counsel to the Underwriters)
reasonably incurred in connection with such qualification and in connection
with the determination of the eligibility of the Securities for investment
under the laws of such jurisdictions as you may designate; provided that the
Company shall not be required to file a general consent to service of process
in any jurisdiction;
(g) to make generally available to its security holders and to you
as soon as practicable but not later than 15 months after the effective date of
the Registration Statement (as defined in Rule 158(c)) an earnings statement
covering a period of at least twelve months beginning with the first fiscal
quarter of the Company occurring after the effective date of the Registration
Statement, which shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 of the Commission promulgated thereunder;
(h) so long as the Securities are outstanding, to furnish to you
copies of all reports or other communications (financial or other) furnished to
holders of Securities, and copies of any reports and financial statements
furnished to or filed with the Commission or any national securities exchange;
(i) during the period beginning on the date hereof and continuing
to and including the Business Day following the Closing Date, not to offer,
sell, contract to sell or otherwise dispose of any debt securities of or
guaranteed by the Company which are substantially similar to the Securities
without your prior written consent; and
(j) to pay all costs and expenses incident to the performance of its
obligations hereunder, including without limiting the generality of the
foregoing, all costs and expenses (i) incident to the preparation, issuance,
execution, authentication and delivery of the Securities, including any
expenses of the Trustee, (ii) incident to the preparation, printing and
filing under the Securities Act of the Registration Statement, the Prospectus
and any preliminary prospectus (including in each case all exhibits,
amendments and supplements thereto), (iii) incurred in connection with the
registration or qualification and determination of eligibility for investment
of the Securities under the laws of such jurisdictions as the Underwriters
may designate (including fees of counsel for the Underwriters and their
disbursements), (iv) in connection with the listing of the Securities on any
stock exchange, (v) related to any filing with National Association of
Securities Dealers, Inc., (vi) in connection with the printing (including
word processing and duplication costs) and delivery of this Agreement, the
Indenture, the Preliminary and Supplemental Blue Sky Memoranda and any Legal
Investment Survey and the furnishing to Underwriters and dealers of copies of
the Registration Statement and the Prospectus, including mailing and
shipping, as herein provided and (vii) payable to rating agencies in
connection with the rating of the Securities.
6. The several obligations of the Underwriters hereunder shall be
subject to the following conditions:
(a) the representations and warranties of the Company contained
herein are true and correct on and as of the Closing Date as if made on and as
of the Closing Date and the Company shall have complied with all agreements and
all conditions on its part to be performed or satisfied hereunder at or prior
to the Closing Date;
(b) the Prospectus shall have been filed with the Commission
pursuant to Rule 424 within the applicable time period prescribed for such
filing by the rules and regulations under the Securities Act; no stop order
suspending the effectiveness of the Registration Statement shall be in effect,
and no proceedings for such purpose shall be pending before or threatened by
the Commission; and all requests for additional information on the part of the
Commission shall have been complied with to your satisfaction;
(c) subsequent to the execution and delivery of this Agreement and
prior to the Closing Date, there shall not have occurred any downgrading, nor
shall any notice have been given of (i) any intended or potential downgrading
or (ii) any review or possible change that does not indicate an improvement, in
the rating accorded any securities of or guaranteed by the Company by any
"nationally recognized statistical rating organization", as
such term is defined for purposes of Rule 436(g)(2) under the Securities Act;
(d) since the respective dates as of which information is given in
the Prospectus there shall not have been any material adverse change or any
development involving a material adverse change, in or affecting the general
affairs, business, prospects, management, properties, financial position,
stockholders' equity or results of operations of the Company and its
subsidiaries, taken as a whole, otherwise than as set forth or contemplated
in the Prospectus, the effect of which in the judgment of the Representatives
makes it impracticable or inadvisable to proceed with the public offering or
the delivery of the Securities on the terms and in the manner contemplated in
the Prospectus;
(e) the Representatives shall have received on and as of the Closing
Date a certificate of an executive officer of the Company satisfactory to you
to the effect set forth in subsections (a) through (c) of this Section and to
the further effect that there has not occurred any material adverse change, or
any development involving a prospective material adverse change, in or
affecting the general affairs, business, prospects, management, properties,
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole from that set forth or
contemplated in the Registration Statement.
(f) Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C., counsel for the Company,
shall have furnished to you its written opinion, dated the Closing Date, in
form and substance satisfactory to you, to the effect that:
(i) the Company has been duly organized and is validly existing
as a corporation in good standing under the laws of its jurisdiction of
incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the Prospectus as then
amended or supplemented;
(ii) the Company has been duly qualified as a foreign
corporation for the transaction of business and is in good standing under the
laws of each other jurisdiction in which it owns or leases properties, or
conducts any business, so as to require such qualification, other than where
the failure to be so qualified or in good standing would not have a material
adverse effect on the Company;
(iii) the Subsidiaries have been duly organized and are
validly existing as corporations or limited partnerships, as the case may be,
in good standing under the laws of their jurisidictions of organization, with
power and authority to own their properites and conduct their business as
described in the Prospectus as amended or supplemented;
(iv) the Subsidiaries have been duly qualified as foreign
corporations or limited partnerships, as the case may be, for the transaction
of business and are in good standing under the laws of each other
jurisdiction in which they own or lease properties, or conduct any business,
so as to require such qualification, other than where the failure to be so
qualified or in good standing would not have a material adverse effect on
the Company;
(v) other than as set forth or contemplated in the Prospectus,
there are no legal or governmental proceedings pending or, to the best of such
counsel's knowledge, threatened to which the Company or the Subsidiaries is or
may be a party or to which any property of the Company or the Subsidiaries is
or may be the subject which, if determined adversely to the Company, or the
Subsidiaries could individually or in the aggregate reasonably be expected to
have a material adverse effect on the general affairs, business, prospects,
management, properties, financial position, stockholders' equity or results of
operations of the Company; to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others; and such counsel does not know of any contracts or other
documents of a character required to be filed as an exhibit to the Registration
Statement or required to be described in the Registration Statement or the
Prospectus which are not filed or described as required;
(vi) this Agreement has been duly authorized, executed and
delivered by the Company and is a valid and binding agreement of the Company,
except as rights to indemnity and contribution hereunder may be limited by
applicable law;
(vii) the Securities have been duly authorized, and when
executed and authenticated in accordance with the terms of the Indenture and
delivered to and paid for by the Underwriters in accordance with the terms of
this Agreement, will constitute valid and binding obligations of the Company
entitled to the benefits provided by the Indenture, enforceable in accordance
with their terms, except that the enforceability thereof may be limited by or
subject to (a) bankruptcy, reorganization, insolvency, fraudulent conveyance,
moratorium or other similar laws now or hereafter existing which affect the
rights and remedies of creditors generally and (b) equitable principles of
general applicability;
(viii) the Indenture has been duly authorized, executed and
delivered by the Company and constitutes a valid and binding instrument of the
Company enforceable in accordance with its terms, except that the
enforceability thereof may be limited by or subject to (a) bankruptcy,
reorganization, insolvency, fraudulent conveyance, moratorium or other similar
laws now or hereafter existing which affect the rights and remedies of
creditors generally and (b) equitable principles of general applicability;
and the Indenture has been duly qualified under the Trust Indenture Act;
(ix) neither the Company nor the Subsidiaries are, nor with the
giving of notice or lapse of time or both would be, in violation of or in
default under, their respective Articles of Incorporation or By-Laws or any
indenture, mortgage, deed of trust, loan agreement or other agreement or
instrument known to such counsel to which the Company or any of the
Subsidiaries is a party or by which they or any of their respective properties
are bound, except for violations and defaults which individually and in the
aggregate are not material to the Company or to the holders of the Securities;
the issue and sale of the Securities and the performance by the Company of its
obligations under the Securities, the Indenture and this Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach of any of the terms or provisions of, or
constitute a default under, any indenture, mortgage, deed of trust, loan
agreement or other material agreement or instrument known to such counsel to
which the Company or any Subsidiary is a party or by which the Company or any
Subsidiary is bound or to which any of the property or assets of the Company or
any Subsidiary is subject, nor will any such action result in any violation of
the provisions of the Articles of Incorporation or the By-Laws of the Company
or any applicable law or statute or any order, rule or regulation of any court
or governmental agency or body having jurisdiction over the Company or any of
its properties;
(x) the Company has authorized and outstanding stock as set
forth under the caption "Capitalization" in the Prospectus;
(xi) no consent, approval, authorization, order, registration
or qualification of or with any court or governmental agency or body is
required for the issue and sale of the Securities or the consummation of the
other transactions contemplated by this Agreement or the Indenture, except such
consents, approvals, authorizations, registrations or qualifications as have
been obtained under the Securities Act and the Trust Indenture Act and as may
be required under state securities or Blue Sky laws in connection with the
purchase and distribution of the Securities by the Underwriter;
(xii) the statements in the Prospectus under the captions
"Description of Notes," "Description of Debt Securities," "Description of
Common Stock," "Description of Preferred Stock," "Description of Common Stock
Warrants," and "Description of Depositary Shares" in the Prospectus and each
document incorporated by reference from Item 3 of Part 1 of the Company's
Annual Report on Form 10-K for the year ended December 31, 1996 and in the
Registration Statement in Item 15, insofar as such statements constitute a
summary of the legal matters, documents or proceedings referred to therein,
fairly present the information called for with respect to such legal matters,
documents or proceedings;
(xiii) such counsel (A) is of the opinion that each document
incorporated by reference in the Registration Statement and the Prospectus
(except for the financial statements included therein as to which such counsel
need express no opinion) complied as to form in all material respects with the
Exchange Act when filed with Commission, (B) believes that (except for the
financial statements included therein as to which such counsel need express
no belief) each part of the Registration Statement (including the documents
incorporated by reference therein) filed with the Commission pursuant to the
Securities Act relating to the Securities, when such part became effective,
did not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading, (C) is of the opinion that the Registration
Statement and the Prospectus and any amendments and supplements thereto (except
for the financial statement included therein as to which such counsel need
express no opinion) comply as to form in all material respects with the
requirements of the Securities Act and the Trust Indenture Act and (D) believes
that (except for the financial statements included therein as to which such
counsel need express no belief) the Registration Statement and the
Prospectus, on the date of this Agreement, did not contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and that
the Prospectus as amended or supplemented, if applicable, does not contain
any untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and
(xiv) the Company is not, and will not become as a result
of the consummation of the transactions contemplated by this Agreement, an
"investment company" within the meaning of the Investment Company Act of 1940,
as amended, and has not been an "investment company" at any time since 1988.
In rendering such opinions, such counsel may rely (A) as to matters
involving the application of laws other than the laws of the United States and
the States of Georgia, to the extent such counsel deems proper and to the
extent specified in such opinion, if at all, upon an opinion or opinions
(in form and substance reasonably satisfactory to Underwriters' counsel) of
other counsel reasonably acceptable to the Underwriters' counsel, familiar
with the applicable laws; (B) as to matters of fact, to the extent such
counsel deems proper, on certificates of responsible officers of the Company
and certificates or other written statements of officials of jurisdictions
having custody of documents respecting the corporate existence or good
standing of the Company. The opinion of such counsel for the Company shall
state that the opinion of any such other counsel is in form satisfactory to
such counsel and, in such counsel's opinion, the Underwriters and they are
justified in relying thereon. With respect to the matters to be covered in
subparagraph (xiii) above counsel may state its opinion and belief is based
upon their participation in the preparation of the Registration Statement and
the Prospectus and any amendment or supplement thereto (other than the
documents incorporated by reference therein) and review and discussion of the
contents thereof (including the documents incorporated by reference therein)
but is without independent check or verification except as specified.
(g) Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C., tax counsel for the
Company, shall have delivered to you its written opinion, dated the Closing
Date, in form and substance satisfactory to you, to the effect that:
(i) the Company met the requirements for qualification and taxation
as a real estate investment trust ("REIT") for the taxable years 1990, 1991,
1992, 1993, 1994, 1995 and 1996;
(ii) the Company's diversity of stock ownership and proposed
method of operation should allow it to qualify as a REIT for 1997; and
(iv) the discussion contained under the caption "Certain Federal
Income Tax Considerations to the Company of its REIT Election" in the Prospectus
forming a part of the Registration Statement, accurately reflects existing law
and fairly addresses the material federal income tax issues described therein.
In rendering such opinions, Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C.
may rely as to matters of fact, to the extent they deem proper, on certificates
of officers of the Company and public officials so long as such counsel states
that no facts have come to the attention of such counsel which lead them to
believe that they are not justified in relying on such certificates. In
addition, Hull, Xxxxxx, Xxxxxx & Xxxxxxx, P.C. may state that their opinions are
based upon the procedures and assumptions set forth in such opinion letter and
that it is limited to the tax matters specifically covered thereby and that
they have not addressed any other tax consequences.
(h) on the Closing Date, Xxxxxx Xxxxxxxx LLP shall have furnished to
you letters, dated such date, in form and substance satisfactory to you,
containing statements and information of the type customarily included in
accountants "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus;
(i) on the Closing Date, Xxxxxx Xxxxxxxx LLP shall have furnished to
you a letter confirming the matters set forth in clauses (i) and (ii) of
subparagraph (g) of this Section 6;
(j) you shall have received on and as of the Closing Date an opinion
of Piper & Marbury L.L.P., counsel to the Underwriters, with respect to the
validity of the Indenture and the Securities, the Registration Statement, the
Prospectus and other related matters as the Representatives may reasonably
request, and such counsel shall have received such papers and information as
they may reasonably request to enable them to pass upon such matters; and
(k) on or prior to the Closing Date, the Company shall have
furnished to the Representatives such further certificates and documents
confirming the representations and warranties contained herein and related
matters as the Representatives shall reasonably request.
The opinions and certificates mentioned in this Agreement shall be deemed to be
in compliance with the provisions hereof only if they are in all material
respects satisfactory to the Representatives and to Piper & Marbury L.L.P.,
counsel for the Underwriters.
7. The Company agrees to indemnify and hold harmless each Underwriter and
each person, if any, who controls any Underwriter within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages and liabilities (including
without limitation the legal fees and other expenses incurred in connection with
any suit, action or proceeding or any claim asserted) caused by any untrue
statement or alleged untrue statement of a material fact contained in the
Registration Statement or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information relating to any Underwriter furnished to the Company in
writing by such Underwriter through the Representatives expressly for use
therein; provided, that the foregoing indemnity with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter (or to the
benefit of any person controlling such Underwriter) from whom the person
asserting any such losses, claims, damages or liabilities purchased Securities
if such untrue statement or omission or alleged untrue statement or omission
made in such preliminary prospectus is eliminated or remedied in the Prospectus
(as amended or supplemented if the Company shall have furnished any amendments
or supplements thereto) and, if required by law, a copy of the Prospectus
(as so amended or supplemented) shall not have been furnished to such person at
or prior to the written confirmation of the sale of such Securities to such
person.
Each Underwriter agrees, severally and not jointly, to indemnify and hold
harmless the Company, its directors, its officers who sign the Registration
Statement and each person who controls the Company within the meaning of
Section 15 of the Securities Act and Section 20 of the Exchange Act, to the
same extent as the foregoing indemnity from the Company to each Underwriter,
but only with reference to information relating to such Underwriter furnished
to the Company in writing by such Underwriter through the Representatives
expressly for use in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any preliminary prospectus.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any person
in respect of which indemnity may be sought pursuant to either of the two
preceding paragraphs, such person (the "Indemnified Person") shall promptly
notify the person against whom such indemnity may be sought (the
"Indemnifying Person") in writing, and the Indemnifying Person, upon request of
the Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the
fees and expenses of such counsel related to such proceeding. In any such
proceeding, any Indemnified Person shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Person unless (i) the Indemnifying Person and the
Indemnified Person shall have mutually agreed to the contrary, (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person or (iii) the named parties
in any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified Persons,
and that all such fees and expenses shall be reimbursed as they are incurred.
Any such separate firm for the Underwriters and such control persons of
Underwriters shall be designated in writing by the first of the named
Representative on Schedule I hereto and any such separate firm for the
Company, its directors, its officers who sign the Registration Statement and
such control persons of the Company or authorized representatives shall be
designated in writing by the Company. The Indemnifying Person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the Indemnifying Person agrees to indemnify any Indemnified
Person from and against any loss or liability by reason of such settlement
or judgment. Notwithstanding the foregoing sentence, if at any time an
Indemnified Person shall have requested an Indemnifying Person to reimburse
the Indemnified Person for fees and expenses of counsel as contemplated by the
third sentence of this paragraph, the Indemnifying Person agrees that it shall
be liable for any settlement of any proceeding effected without its written
consent if (i)such settlement is entered into more than 30 days after receipt
by such Indemnifying Person of the aforesaid request and (ii) such Indemnifying
Person shall not have reimbursed the Indemnified Person in accordance with
such request prior to the date of such settlement. No Indemnifying
Person shall, without the prior written consent of the Indemnified Person,
effect any settlement of any pending or threatened proceeding in respect of
which any Indemnified Person is or could have been a party and indemnity
could have been sought hereunder by such Indemnified Person, unless
such settlement includes an unconditional release of such Indemnified Person
from all liability on claims that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs of this
Section 7 is unavailable to an Indemnified Person in respect of any losses,
claims, damages or liabilities referred to therein, then each Indemnifying
Person under such paragraph, in lieu of indemnifying such Indemnified Person
thereunder, shall contribute to the amount paid or payable by such Indemnified
Person as a result of such losses, claims, damages or liabilities (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters on the other hand from the
offering of the Securities or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate
to reflect not only the relative benefits referred to in clause (i) above but
also the relative fault of the Company on the one hand and the Underwriters on
the other in connection with the statements or omissions that resulted
in such losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative benefits received by the Company on the
one hand and the Underwriters on the other shall be deemed to be in the same
respective proportions as the net proceeds from the offering of such
Securities (before deducting expenses) received by the Company and the total
underwriting discounts and the commissions received by the Underwriters bear to
the aggregate public offering price of the Securities. The relative fault of
the Company on the one hand and the Underwriters on the other shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the Company or by the
Underwriters and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.
The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this Section 7 were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Person as a
result of the losses, claims, damages and liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses incurred by such
Indemnified Person in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, in no
event shall an Underwriter be required to contribute any amount in excess of
the amount by which the total price at which the Securities underwritten by
it and distributed to the public were offered to the public exceeds the
amount of any damages that such Underwriter has otherwise been required to
pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant to
this Section 7 are several in proportion to the respective principal amount of
the Securities set forth opposite their names in Schedule I hereto, and not
joint.
The indemnity and contribution agreements contained in this Section 7 are in
addition to any liability which the Indemnifying Persons may otherwise have to
the Indemnified Persons referred to above.
The indemnity and contribution agreements contained in this Section 7 and the
representations, warranties and covenants of the Company set forth in this
Agreement shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on
behalf of any Underwriter or any person controlling any Underwriter or by or on
behalf of the Company, its officers or directors or any other person
controlling the Company and (iii) acceptance of and payment for any of the
Securities.
8. Notwithstanding anything herein contained, this Agreement may be
terminated in the absolute discretion of the Representatives, by notice given
to the Company, if after the execution and delivery of this Agreement and
prior to the Closing Date (i) there shall have occurred, since the respective
dates as of which information is given in the Registration Statement and the
Prospectus,
any material adverse change or any development involving a prospective material
adverse change in or affecting the condition, financial or otherwise, of the
Company or the earnings, business affairs, properties, management or business
prospects of the Company, whether or not arising in the ordinary course of
business, (ii) trading generally shall have been suspended or materially
limited on or by, as the case may be, any of the New York Stock Exchange, the
American Stock Exchange, the National Association of Securities Dealers, Inc.,
the Chicago Board Options Exchange, the Chicago Mercantile Exchange or the
Chicago Board of Trade, (iii) trading of any securities of or guaranteed by the
Company shall have been suspended on any exchange or in any over-the-counter
market, (iv) a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities; (v)
there has occurred any downgrading in the rating of the Company's debt
securities by any "nationally recognized statistical rating organization" (as
defined for purposes of Rule 436(g) under the Exchange Act); or (vi) there shall
have occurred any outbreak or escalation of hostilities or any change in
financial markets or any calamity or crisis that, in the judgment of the
Representatives, is material and adverse and which, in the judgment of the
Representatives, makes it impracticable to market the Designated Securities on
the terms and in the manner contemplated in the Prospectus.
9. If, on the Closing Date, any one or more of the Underwriters shall fail
or refuse to purchase Securities which it or they have agreed to purchase under
this Agreement, and the aggregate principal amount of Securities which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
is not more than one-tenth of the aggregate principal amount of the Securities,
the other Underwriters shall be obligated severally in the proportions that the
principal amount of Securities set forth opposite their respective names in
Schedule I hereto bears to the aggregate principal amount of Securities set
forth opposite the names of all such non-defaulting Underwriters, or in such
other proportions as the Representatives may specify, to purchase the
Securities which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided that in no event shall the
principal amount of Securities that any Underwriter has agreed to purchase
pursuant to Section 1 be increased pursuant to this Section 9 by an amount in
excess of one-ninth of such principal amount of Securities without the
written consent of such Underwriter. If, on the Closing Date, any Underwriter
or Underwriters shall fail or refuse to purchase Securities and the aggregate
principal amount of Securities with respect to which such default occurs is
more than one-tenth of the aggregate principal amount of Securities to be
purchased, and arrangements satisfactory to you and the Company for the purchase
of such Securities are not made within 36 hours after such default, this
Agreement shall terminate without liability on the part of any non-defaulting
Underwriter or the Company. In any such case either you or the Company shall
have the right to postpone the Closing Date, but in no event for longer than
seven days, in order that the required changes, if any, in the Registration
Statement and in the Prospectus or in any other documents or arrangements may
be effected. Any action taken under this paragraph shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. If this Agreement shall be terminated by the Underwriters, or any of
them, because of any failure or refusal on the part of the Company to comply
with the terms or to fulfill any of the conditions of this Agreement, or if for
any reason the Company shall be unable to perform its obligations under this
Agreement or any condition of the Underwriters' obligations cannot be
fulfilled, the Company agrees to reimburse the Underwriters or such
Underwriters as have so terminated this Agreement with respect to themselves,
severally, for all out-of-pocket expenses (including the fees and expenses of
their counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering of Securities.
11. This Agreement shall inure to the benefit of and be binding upon the
Company, the Underwriters, any controlling persons referred to herein and their
respective successors and assigns. Nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person, firm or
corporation any legal or equitable right, remedy or claim under or in
respect of this Agreement or any provision herein contained. No purchaser of
Securities from any Underwriter shall be deemed to be a successor by reason
merely of such purchase.
12. Any action by the Underwriters hereunder may be taken by you jointly or
by the first of the named Representative set forth in Schedule I hereto alone
on behalf of the Underwriters, and any such action taken by you jointly or by
the first of the named Representative set forth in Schedule I hereto alone
shall be binding upon the Underwriters. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
mailed or transmitted by any standard form of telecommunication. Notices
to the Underwriters shall be given at the address set forth in Schedule II
hereto. Notices to the Company shall be given to it at Merry Land & Investment
Company, Inc., 000 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxx 00000, Attention: X.
Xxxxxxx Houston.
13. Miscellaneous. This Agreement may be signed in counterparts, each of
which shall be an original and all of which together shall constitute one and
the same instrument. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without giving effect to the
conflicts of laws provisions thereof.
Very truly yours,
MERRY LAND & INVESTMENT COMPANY,
INC.
/s/
By:_______________________________________
Name: X. Xxxxxxx Houston
Title: President
Accepted: July 23, 1997
X.X. XXXXXX SECURITIES INC.
/s/
By:______________________________
Name:
Title:
SCHEDULE I
Representatives: X.X. Xxxxxx Securities Inc., BT Securities
Corporation, First Union Capital Markets Corp.
Underwriting Agreement dated: July 23, 1997
Registration Statement No.: 33-65067
Title of Securities: 6.90% Notes due 0000
Xxxxxxxxx principal amount: $50,000,000
Price to Public: 99.707% of the principal amount of the Securities,
plus accrued interest, if any, from July 28, 1997 to
the Closing Date
Underwriting Discount: .650%
Indenture: Indenture dated as of February 1, 1995, and the
Supplemental Indenture dated as of June 1, 1995, both
between Merry Land & Investment Company, Inc.
and First Union National Bank of Georgia
Maturity: August 1, 2007
Interest Rate: 6.90%
Interest Payment Dates: February 1 and August 1
Optional Redemption Provisions: Reedeemable at anytime at the option of
the Company, in whole or in part, at a
redemption price equal to the sum of
(i) the principal amount of the
Notes being redeemed plus accrued
interest to the redemption date, plus
(ii) the Make-Whole Amount, if any
Sinking Fund Provisions: None
Other Provisions: As specified in the Prospectus Supplement
dated July 23, 1997 relating to the
Securities.
Closing Date and Time of Delivery: July 28, 1997
Closing Location: Piper & Marbury L.L.P.,
00 Xxxxx Xxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Address for Notices
to Underwriters: c/o X.X. Xxxxxx Securities Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
SCHEDULE II
Underwriter Principal Amount of Notes
To Be Purchased
X.X. Xxxxxx Securities Inc. $30,000,000
BT Securities Corporation $10,000,000
First Union Capital Markets Corp. $10,000,000
=========
Total.................... $50,000,000
SCHEDULE III
Subsidiaries
--------------
ML Apartments Limited
Merry Land Apartment Communities, Inc.
ML Texas Apartments, L.P.
ML North Carolina Apartments, L. P.
ML Tennessee Apartments, L.P.
ML Alabama Apartments, Inc.
