EXHIBIT 10(vii)
SERVICING AND PURCHASE AGREEMENT
THIS SERVICING AND PURCHASE AGREEMENT (as amended, modified or
supplemented from time to time, the "Agreement"), is made the _____ day of June,
1999, by and between United Dominion Realty Trust, Inc., a Virginia corporation
("UDR"), and Crestar Bank, a Virginia banking corporation (the "Bank").
RECITALS:
UDR has requested that the Bank make loans (collectively, the "Loans"
and each, a "Loan") to the directors and officers of UDR listed on Exhibit A
attached hereto (collectively, the "Eligible Individuals," and each, an
"Eligible Individual"). In order to induce the Bank to make the Loans, UDR has
agreed to act for the benefit of the Bank as the servicing agent with respect to
the Loans, to purchase the Loans from the Bank in accordance with the terms of,
and under the circumstances described in, this Agreement, and otherwise to
comply with the representations, warranties and agreements contained herein.
Accordingly, in consideration of the foregoing and of the mutual promises herein
contained, the parties agree hereto as follows:
1. (a) Subject to the terms and conditions of this Agreement, the Bank
will make Loans from time to time from the date of this Agreement until December
1, 1999. The amount of each Loan shall not exceed the respective "Maximum Loan
Amount" listed on Exhibit A for each Eligible Individual. The maximum amount of
Loans shall not exceed $12,000,000 in aggregate principal amount.
(b) The Loans shall be evidenced by promissory notes (collectively,
the "Notes," and each, a "Note") in the forms of Exhibit B-1 or Exhibit B-2
attached hereto, to be made by the respective Eligible Individuals. Each Loan
must be in a principal amount not less than $25,100. Each request for a Loan
shall be made by delivery of a written request from UDR, in substantially the
form of Exhibit C attached hereto, to the Bank at least three business days
prior to the date on which the Loan is to be disbursed. The original Note shall
be delivered to the Bank upon the disbursement of the Loan evidenced thereby.
(c) The proceeds of the Loans shall be used by the respective
Eligible Individuals to finance the purchase of shares of common stock of UDR
("Stock"), and for no other purpose.
(d) UDR represents and warrants to the Bank that each Note will be a
legal, valid and binding obligation of the Eligible Individual named as maker
thereof, enforceable in accordance with its terms, and evidencing a bona fide
transaction which has arisen out of a loan made by the Bank to such Eligible
Individual in full compliance with Regulations G and U of the Board of Governors
of the Federal Reserve System, the Equal Credit Opportunity Act, and any usury
laws of states other than Virginia that might be applicable to the Loans ("Legal
Requirements"). UDR further represents and warrants to the Bank that none of the
Notes shall be secured, directly or indirectly, with any "Margin Security" as
defined by Regulation G or Regulation U of the Board of Governors of the Federal
Reserve System.
2. UDR agrees to give the Bank prompt written notice of (a) any
Eligible Individual that has failed to make payment on any Note within three (3)
months after its due date and (b) any breach of the representation and warranty
as to compliance with Legal Requirements provided in Section 1 hereof.
3. (a) When UDR, in performance of its duties as agent for the Bank,
has not received payment with respect to any Note within three (3) months after
its due date, for any reason, or if there has been a breach of any
representation or warranty made by UDR with respect to any such Note, the Bank,
at its option, may request UDR, upon each Quarterly Payment Date (as defined
below), to purchase such Note from the Bank at a price equal to the then unpaid
principal balance of such Note reflected on the Bank's records, plus any
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interest, finance, penalty or other charges collected under such Note and not
previously remitted to the Bank under Section 6 hereof, and plus, if applicable,
interest charges with respect to such Note calculated in accordance with Section
9 hereof (the "Purchase Price"), and UDR shall purchase such Note at the
Purchase Price immediately upon such Quarterly Payment Date. Any such request
from the Bank shall be given in writing to UDR not less than 90 days prior to
the applicable Quarterly Payment Date. UDR may, at its option, purchase any Note
which is in default at any time or from time to time at the Purchase Price.
Purchases pursuant to this Section 3(a) will not be subject to the Penalty, as
defined in Section 11 hereof.
(b) In addition to, and without limiting the Bank's rights pursuant
to Section 3(a) above, on __________ and ___________ of each year, beginning on
___________, 1999 (each, a "Semiannual Purchase Date"), the Bank may require UDR
to purchase at the Purchase Price all of the then outstanding Notes, and UDR
will purchase the Notes on such Semiannual Purchase Date. If the Bank wishes to
exercise this option, it shall provide written notice to that effect to UDR no
later than 90 days prior to the relevant Semiannual Purchase Date. Purchases
pursuant to this Section 3(b) will not be subject to the Penalty;
(c) In addition to, and without limiting the Bank's rights under
Sections 3(a) and 3(b) above, the Bank also may require UDR immediately to
purchase, at the Purchase Price, all then outstanding Notes upon the occurrence
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of an Event of Default (as defined below), and UDR will purchase the Notes
within ten business days after it receives the Bank's written demand therefor.
Purchases pursuant to this Section 3(c) will be subject to the Penalty.
(d) On __________, 2001 (the "Maturity Date"), UDR shall purchase
all then outstanding Notes from the Bank at the Purchase Price. The Bank will
review this credit facility on an annual basis, beginning in April 2000, to
determine whether it is willing to extend the Maturity Date for an additional
year. UDR acknowledges and agrees that the Bank is under no obligation to extend
the Maturity Date.
(e) Upon receipt of the Purchase Price, the Bank shall endorse and
deliver each purchased Note to the order of UDR, without recourse and without
representation or warranty, except warranty of title (that the Bank is the sole
legal holder of the Note) and any endorsements necessary for the Bank to
transfer its interest in such Note to UDR.
4. UDR shall pay its and the Bank's costs and expenses incurred in
entering into this Agreement (provided that the obligation to pay the Bank's
costs and expenses incurred in entering into this Agreement will not exceed
$10,000), and shall pay all of the Bank's costs and expenses incurred in
connection with the enforcement of this Agreement.
5. The Bank hereby appoints UDR as agent for the Bank to perform such
duties as are expressly set forth in this Agreement for the purpose of carrying
out the intent hereof, and UDR hereby accepts such appointment.
6. As agent for the Bank, UDR shall, with respect to the Notes that
have not been purchased by UDR, and at the sole cost and expense of UDR:
(a) Cause each Note to be completed, executed and delivered by each
Eligible Individual to whom a Loan is made;
(b) Receive, at its offices and at its duly authorized collection
agencies, payments made by Eligible Individuals on account of the Notes;
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(c) Furnish, prepare and mail "past-due notices" to Eligible
Individuals, on forms provided by the Bank and satisfactory to UDR, with respect
to such installments as are not paid by Eligible Individuals within thirty (30)
days after their respective due dates, or as otherwise agreed upon by UDR and
the Bank;
(d) Take diligent steps to effect collection of past-due
installments;
(e) Remit to the Bank quarterly, on February 1, May 1, August 1 and
October 1 of each year (or as of the next business day following such date if
such date is not a business day), beginning on August 1, 1999 (each, a
"Quarterly Payment Date"), all payments of principal (if any), including
prepayments, received by UDR as agent for the Bank in respect of the Notes
during such calendar quarter then ending; and remit to the Bank quarterly, on
each Quarterly Payment Date, all interest, finance, penalty and other charges
collected by UDR as agent for the Bank in respect of the Notes during such
calendar quarter then ending; and
(f) Transmit to the Bank quarterly as of each Quarterly Payment
Date, such information concerning the Notes as is reasonably necessary to enable
the Bank to maintain accurate books and records with respect to the transactions
under this Agreement. Such information shall include, as of the time of
transmission and without limitation, a statement of all then outstanding Notes,
together with a statement of the maker or makers of each Note, the original
principal balance thereof, the current principal balance thereof, the original
date thereof, the maturity date thereof, and interest and principal paid during
the quarterly period subject thereto.
7. In determining the amount of finance charges collected under the
Notes, each installment payment by an Eligible Individual shall include
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principal (upon maturity or if a curtailment is being made by such Eligible
Individual) and interest as reflected in the records maintained by UDR as agent
with respect to each Note.
8. UDR shall indemnify the Bank against any and all liability, claims,
expenses, and damage (including reasonable attorneys' fees) resulting from UDR's
performance or nonperformance of its duties as agent or from any violation or
alleged violation of any applicable Legal Requirements with respect to the
Notes. If any such action is brought against the Bank, UDR shall be entitled to
assume the defense thereof with counsel reasonably satisfactory to the Bank;
provided, however, that the Bank may at its own expense continue to participate
in the defense of such action if the Bank so chooses.
9. (a) UDR agrees to pay to the Bank, on each Quarterly Payment Date,
commencing on August 1, 1999, on the Maturity Date, and on demand, after the
Maturity Date or upon the occurrence of an Event of Default, an interest charge
in an amount computed by multiplying (a) the daily unpaid principal balances of
the Notes, as shown by the Bank's books, for the number of days elapsed from the
last payment of interest (or from the date of the first Loan in case of the
first payment), by (b) a daily percentage rate equal to the then Applicable Bank
Rate (as defined below), divided by 360, and carried to five decimal places.
(b) Prior to the occurrence of an Event of Default, the "Applicable
Bank Rate" shall mean LIBOR (as defined below) for a six-month term (the
"Six-Month LIBOR") plus 1.65%, based initially on the Six-Month LIBOR in effect
on the date hereof, and adjusted on each Semiannual Purchase Date and on the
Maturity Date to reflect Six-Month LIBOR then in effect. From and after the
occurrence of an Event of Default, the Applicable Bank Rate shall mean the
Applicable Bank Rate then in effect plus 2%. "LIBOR" shall mean, for any term,
the rate per annum at which dollar deposits with a maturity equal to such term
are offered to leading banks in the London interbank market at 11:00 a.m.
(London time) two business days prior to the effective date on which LIBOR is to
be determined hereunder, based on the British Bankers Association quotations
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published by the Dow Xxxxx Telerate Service, the Reuters Monitor Money Rates
Service or any other reliable interest rate reporting service customarily used
by financial institutions, as adjusted from time to time in the Bank's sole
discretion, for then-applicable reserve requirements, deposit insurance
assessment rates, broker's commissions and other regulatory costs.
(c) If the interest charge exceeds the aggregate amount of finance
charges payable to the Bank under the Notes, UDR shall pay such excess to the
Bank. If the aggregate amount of financing charges payable to the Bank under the
Notes exceeds the interest charge, UDR shall retain the excess.
10. UDR agrees to pay to the Bank (a) on December 1, 1999, a
nonrefundable fee in an amount equal to .10% of the aggregate principal amount
of Loans made by the Bank, and (b) on the first to occur of ____________, 2000,
or the date on which UDR is required to purchase all of the Notes in accordance
with the terms of this Agreement, a nonrefundable fee equal to .10% of the
aggregate principal amount of the Loans then outstanding and held by the Bank.
11. If UDR purchases Notes pursuant to Section 3(c) hereof, UDR shall
at the time of such purchase pay to the Bank a purchase penalty calculated in
accordance with this Section 11 (the "Penalty"). The Penalty shall be calculated
by multiplying the principal balance of the Notes being purchased by the Rate
Differential and by the remaining term to the next succeeding Semiannual
Purchase Date, the Maturity Date, or, if the purchase is made after the Maturity
Date, six months after the Maturity Date, as applicable (the "Assumed Maturity
Date"). The "Rate Differential" shall mean the difference between the Original
Base Rate and the Current Base Rate discounted at the Current Base Rate from the
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Assumed Maturity Date to the date of purchase. The "Original Base Rate" shall
mean the Six-Month LIBOR used by the Bank in establishing the then Applicable
Bank Rate and the "Current Base Rate" shall mean LIBOR as of the date of the
purchase for a term equal to the term beginning on the date of the purchase and
ending on the Assumed Maturity Date.
12. Provided that Eligible Individual confidentiality and privacy are
maintained, UDR's books, accounts, correspondence and other records pertaining
to Notes serviced for the Bank shall at all reasonable times be open for
inspection and audit by the Bank or any governmental agency having jurisdiction
over the Bank's activities. UDR, as agent, shall furnish to the Bank any
information reasonably requested by the Bank in respect of the Notes.
13. (a) The following conditions must be satisfied prior to the Bank
making the first Loan:
(1) Receipt by the Bank of this Agreement duly
executed by UDR;
(2) Receipt by the Bank of certified copies of
appropriate resolutions of the board of directors of UDR authorizing the
execution and deliver of the documents described in this Agreement and the
performance of its obligations under such documents, together with a certificate
as to the incumbency and signature of each officer authorized to sign such
documents;
(3) No event shall have occurred and be continuing
which constitutes an Event of Default (as defined below) under this Agreement,
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or which would constitute an Event of Default but for the requirement that
notice be given or that a period of time elapse, or both;
(4) All representations and warranties contained in
this Agreement shall be true and correct;
(5) Receipt by the Bank of an opinion of counsel to
UDR, in a form reasonably acceptable to the Bank, and
(6) All legal matters incident to this Agreement will
be satisfactory to the Bank's counsel.
(b) The following conditions must be satisfied prior to the making
of any subsequent Loan:
(1) No event shall have occurred and be continuing
which constitutes an Event of Default under this Agreement, or which would
constitute an Event of Default but for the requirement that notice be given or
that a period of time elapse, or both;
(2) All representations and warranties contained in
this Agreement (including those representations and warranties incorporated by
reference herein) shall be true and correct as of the date of each subsequent
Loan; and
(3) All legal matters incident to each subsequent
Loan shall be satisfactory to the Bank and its counsel.
14. The Borrower hereby repeats, as of the date of this Agreement, all
of the representations and warranties set forth in Sections 6.3, 6.7, 6.8, 6.9,
6.10, and 6.11 of the Three-Year Credit Agreement, dated as of August 4, 1997,
by and among the Borrower, NationsBank, N.A., as agent, and the lenders and
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guarantors party thereto (the "Senior Unsecured Credit Facility Agreement"), and
such representations and warranties are incorporated by reference with the same
force and effect as if set forth herein. In addition, UDR represents and
warrants as follows:
(a) UDR has the power and has taken all the necessary corporate
actions to execute, deliver and perform the terms of this Agreement and all of
the documents required by this Agreement to be executed and delivered by it
(collectively, the "Documents"), and the Documents, when executed and delivered,
will be binding obligations of UDR, enforceable in accordance with their terms
(except as such enforceability may be limited by applicable bankruptcy,
insolvency and other laws affecting creditors' rights generally and general
equitable principles), and will not violate any provisions of law or conflict
with, result in a breach of, or constitute a default under the articles of
incorporation or by-laws of UDR, or any other note, indenture, mortgage, lease,
contract or other agreement to which UDR is a party;
(b) All financial statements and information delivered to the Bank
by UDR in connection with this Agreement were prepared in accordance with
generally accepted accounting principles, are correct and complete and present
fairly the financial condition, and reflect all known liabilities, contingent or
otherwise, of UDR as of the dates of such statements and information, and since
such dates no material adverse change in the assets, liabilities, financial
condition, business or operations of UDR has occurred; and
(c) There is no action, suit or proceeding pending or, to the
knowledge of UDR, threatened against or affecting UDR which may, either in any
case or in the aggregate, result in any material adverse change in the business,
properties or assets or in the condition, financial or otherwise, of UDR, or
which may result in any material liability on the part of UDR, or which
questions the validity of any of the Documents or any action taken or to be
taken in connection with the Documents.
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15. During the term of this Agreement, UDR agrees to perform, observe
and comply with the covenants and agreements set forth in Sections 7, 8 and 9 of
the Senior Unsecured Credit Facility Agreement, and such covenants and
agreements are incorporated by reference with the same force and effect as if
set forth herein.
16. Each of the following shall constitute an "Event of Default"
under this Agreement:
(a) If UDR fails to make when due any Purchase Price, installment or
other payment owing to the Bank under the terms of this Agreement within ten
days after the date due;
(b) If UDR fails to perform or observe any term, covenant, warranty
or agreement contained in this Agreement (including any term, covenant, warranty
or agreement incorporated by reference herein) and such failure shall continue
for a period of 30 days after written notice of such failure has been given to
UDR by the Bank, provided that if such failure is not capable of being cured
within such 30-day period, it shall not be an Event of Default if UDR commences
the curing of such failure, continues to prosecute such cure diligently and
completes the curing of such failure within 60 days after the end of such 30-day
period;
(c) Discovery that any representation or warranty made by the
Company in this Agreement (including any representation or warranty incorporated
by reference herein), or any statement or representation made in any
certificate, report or opinion delivered pursuant to this Agreement or in
connection with any borrowing under this Agreement (including any statement or
representation incorporated by reference herein) was materially untrue or is
breached in any material respect;
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(d) If any event of default, or an event which with the giving of
notice or lapse of time, or both, would constitute an event of default, shall
occur with respect to any present or future indebtedness of UDR for borrowed
money in excess of $10,000,000;
(e) A material adverse change occurs in the financial or business
condition of UDR; or
(f) The occurrence of an Event of Default under the Senior Unsecured
Credit Facility Agreement.
17. All rights hereunder shall remain in effect until all of the Notes
have been fully paid and remitted to the Bank or until all of the Notes have
been purchased by UDR. Failure by the Bank or UDR to exercise any right
hereunder shall not operate as a waiver of such right or any other default. All
rights and remedies hereunder are cumulative, and not alternative.
18. This Agreement shall be binding upon and inure to the benefit of
the successors and assigns of the parties hereto, and shall not be changed
except in writing by duly authorized officers of the parties thereto at the time
of such change.
19. This Agreement shall be construed in accordance with, and governed
by, the laws of the Commonwealth of Virginia, without reference to conflict of
laws principles.
20. All notices and other communications provided for hereunder shall
be in writing (including telecopier, telegraphic, telex or cable communication)
and mailed, telecopied, telegraphed, telexed, cabled or delivered by hand or
sent, prepaid, by Federal Express (or a comparable overnight delivery service),
if to the UDR, at its address at 00 Xxxxx 0xx Xxxxxx, Xxxxxxxx, Xxxxxxxx 00000,
Attention: Vice President of Finance, with a copy to the attention of the
General Counsel at the same address, if to the Bank at 0000 Xxxxx Xxxxxxxxx,
Xxxxxx, Xxxxxxxx, Attention: Xxxxx X. Xxxxxxxx; or, as to each party, at such
other address as shall be designated by such party in a written notice to the
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other parties. Any such notice or other communication, when mailed, telecopied,
telegraphed, telexed, cabled, delivered by hand or sent overnight, shall be
effective on the earliest of (a) the date it is actually received or telecopied,
telexed (confirmed by telex answerback), or delivered by hand, (b) the Business
Day after the day on which it is properly delivered to a telegraph or cable
company or to Federal Express (or a comparable overnight delivery service), as
applicable, or (c) the third Business Day after the day on which it is deposited
in the United States mail.
21. This Agreement contains the entire understanding between the
parties hereto with respect to the subject matter hereof.
UNITED DOMINION REALTY TRUST, INC. CRESTAR BANK
By:_______________________________ By:______________________________
Name:_____________________________ Name:____________________________
Title:____________________________ Title:___________________________
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EXHIBIT A
UNITED DOMINION REALTY TRUST, INC.
Participation Agreement
(Director)
THIS AGREEMENT dated as of the 12th day of July, 1999, by and between
UNITED DOMINION REALTY TRUST, INC. (the "Company") and {{Participant}}
("Participant") recites and provides as follows:
RECITALS:
In order to facilitate investment by its officers and directors in its Common
Stock and to promote identification of their personal interests with its
corporate interests, the Company has entered into a Servicing and Purchase
Agreement dated as of June 9, 1999 (the "Servicing and Purchase Agreement") with
Crestar Bank, a Virginia banking corporation ("Crestar"), pursuant to which
Crestar has agreed to make loans to officers and directors for the purpose of
financing the purchase of Common Stock, and, in order that the participating
officers and directors may benefit from the more favorable lending terms
available to the Company and not to such participants on an individual basis,
the Company has agreed, among other things, that Crestar may require the Company
to purchase notes of such participants at regular intervals.
The Participant has obtained a loan from Crestar in the principal amount of
{{Amount}} Dollars (the "Loan"), evidenced by a note dated as of July 12, 1999,
in the principal amount of the Loan (the "Note"), made by the Participant for
the benefit of Crestar, and has used the proceeds of the Loan to purchase
{{Shares}} shares (the "Shares") of Common Stock.
In order to assure that its objectives in entering into the Servicing and
Purchase Agreement are realized, the Company has requested, and the Participant
has agreed, that certain acts by the Participant that are inconsistent with
these objectives shall have the consequences herein specified.
AGREEMENT:
IN CONSIDERATION of the covenants set forth herein and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Participant agree as follows:
1. Transfer of Shares. In the event that Participant shall transfer any
of the Shares, the rate of interest borne by the Note shall, at the option of
the Company, increase effective as of the effective date of such transfer to
five percent (5%) over the then applicable interest rate under the Note.
2. Dividends. All cash dividends the Participant receives on the Shares
shall be applied toward the payment of the Note.
3. Late Fees. Participant shall pay the Company a late fee of two
percent (2%) in excess of the then applicable interest rate under the Note on
any payments that are not paid in a timely fashion.
4. Termination of Service. If the Participant's service with the Board
of Directors terminates, the Participant shall pay the Note in full within 90
days after the effective date of the termination of service except in the
following circumstances:
(i) if the termination is as a result of a "Change of Control," as
hereinafter defined, the Participant shall pay the Note in full on the maturity
of the Note.
(ii) if the Participant retires after at least ten (10) years of
service with the Company (including service with a predecessor of the Company),
the Note shall be paid in full on the maturity of the Note.
5. Change of Control. For purposes of this Agreement, "Change of
Control" shall mean (i) the merger or consolidation of the Company with any
other real estate investment trust, corporation or other business entity, in
which the Company is not the survivor (without respect to the legal structure of
the transaction), (ii) the transfer or sale of all or substantially all of the
assets of the Company other than to an affiliate or subsidiary of the Company,
(iii) the liquidation of the Company, or (iv) the acquisition by any person or
by a group of persons acting in concert, of more than 50% of the outstanding
voting securities of the Company, which results in the resignation or addition
of fifty percent (50%) or more members of the Board of Directors of the Company
(the "Board") or the resignation or addition of fifty percent (50%) or more
independent members of the Board.
6. No Right to Continued Service. This Agreement does not confer upon
the Participant any right to continuance of nomination for service on the Board.
7. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the legatees, distributees, and personal representatives of the
Participant and the successors and assigns of the Company.
8. Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Virginia.
9. Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original document, but all
of which counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to
be signed by a duly authorized officer and the Participant has affixed his
signature hereto.
UNITED DOMINION REALTY TRUST, INC.
By:_______________________________________
Title:____________________________________
__________________________________________
{{Participant}}
EXHIBIT A
UNITED DOMINION REALTY TRUST, INC.
Participation Agreement
(Officer)
THIS AGREEMENT dated as of the 12th day of July, 1999, by and between
UNITED DOMINION REALTY TRUST, INC. (the "Company") and {{Participant}}
("Participant") recites and provides as follows:
RECITALS:
In order to facilitate investment by its officers and directors in its Common
Stock and to promote identification of their personal interests with its
corporate interests, the Company has entered into a Servicing and Purchase
Agreement dated as of June 9, 1999 (the "Servicing and Purchase Agreement") with
Crestar Bank, a Virginia banking corporation ("Crestar"), pursuant to which
Crestar has agreed to make loans to officers and directors for the purpose of
financing the purchase of Common Stock, and, in order that the participating
officers and directors may benefit from the more favorable lending terms
available to the Company and not to such participants on an individual basis,
the Company has agreed, among other things, that Crestar may require the Company
to purchase notes of such participants at regular intervals.
The Participant has obtained a loan from Crestar in the principal amount of
{{Amount}} Dollars (the "Loan"), evidenced by a note dated as of July 12, 1999,
in the principal amount of the Loan (the "Note"), made by the Participant for
the benefit of Crestar, and has used the proceeds of the Loan to purchase
{{Shares}} shares (the "Shares") of Common Stock.
In order to assure that its objectives in entering into the Servicing and
Purchase Agreement are realized, the Company has requested, and the Participant
has agreed, that certain acts by the Participant that are inconsistent with
these objectives shall have the consequences herein specified.
AGREEMENT:
IN CONSIDERATION of the covenants set forth herein and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Company and the Participant agree as follows:
1. Transfer of Shares. In the event that Participant shall transfer any
of the Shares, the rate of interest borne by the Note shall, at the option of
the Company, increase effective as of the effective date of such transfer to
five percent (5%) over the then applicable interest rate under the Note.
2. Dividends. All cash dividends the Participant receives on the Shares
shall be applied toward the payment of the Note.
3. Late Fees. Participant shall pay the Company a late fee of two
percent (2%) in excess of the then applicable interest rate under the Note on
any payments that are not paid in a timely fashion.
4. Termination of Employment. If the Participant's employment with the
Company or its Affiliates terminates:
(i) by the Participant, or by the Company for cause, the Participant
shall pay the Note in full within 90 days after the effective date of the
termination of employment.
(ii) by the Company without cause, the Participant shall pay the Note
in full on the earlier of the first anniversary of the termination of employment
or the maturity of the Note.
(iii) as a result of a "Change of Control," as hereinafter defined, the
Participant shall pay the Note in full on the maturity of the Note.
5. Change of Control. For purposes of this Agreement, "Change of
Control" shall mean (i) the merger or consolidation of the Company with any
other real estate investment trust, corporation or other business entity, in
which the Company is not the survivor (without respect to the legal structure of
the transaction), (ii) the transfer or sale of all or substantially all of the
assets of the Company other than to an affiliate or subsidiary of the Company,
(iii) the liquidation of the Company, or (iv) the acquisition by any person or
by a group of persons acting in concert, of more than 50% of the outstanding
voting securities of the Company, which results in the resignation or addition
of fifty percent (50%) or more members of the Board of Directors of the Company
(the "Board") or the resignation or addition of fifty percent (50%) or more
independent members of the Board.
6. No Right to Continued Employment. This Agreement does not confer
upon the Participant any right to continuance of employment by the Company or
any Affiliate, nor shall it interfere in any way with the right of the Company
or an Affiliate to terminate the Participant's employment at any time.
7. Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the legatees, distributees, and personal representatives of the
Participant and the successors and assigns of the Company.
8. Governing Law. This Agreement shall be governed by the laws of the
Commonwealth of Virginia.
9. Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original document, but all
of which counterparts shall together constitute one and the same instrument.
IN WITNESS WHEREOF, the Company has caused this Agreement to
be signed by a duly authorized officer and the Participant has affixed his
signature hereto.
UNITED DOMINION REALTY TRUST, INC.
By:_______________________________________
Title:____________________________________
__________________________________________
{{Participant}}
EXHIBIT X-0
XXXXXXXXXX XXXX
(Xxxxxxx - XXXXX)
${{Number}} Richmond, Virginia
June 24, 1999
FOR VALUE RECEIVED, the undersigned ("Maker"), {{Participant}} promises
(or if there shall be two Makers, both jointly and severally promise) to pay to
the order of CRESTAR BANK, on June 24, 2004, at such place as the holder hereof
may designate in writing, in lawful money of the United States of America, the
principal sum of {{Amount}} Dollars (${{Number}}), with interest thereon payable
in arrears on the first days of each February, May, August and October until
this Note is paid in full, at the rate set forth below.
1. Interest shall be payable at LIBOR, as defined below, for a
six-month term ("Six-Month LIBOR") plus 1.65%, based initially on the Six-Month
LIBOR in effect on the date hereof, and adjusted on December 31 and June 30 of
each year during the term hereof based upon the Six-Month LIBOR then in effect.
"LIBOR" shall mean, for any term, the rate per annum at which dollar deposits
with a maturity equal to such term are offered to leading banks in the London
interbank market at 11:00 a.m. (London time) two business days prior to the
effective date on which LIBOR is to be determined hereunder, based on the
British Bankers Association quotations published by the Dow Xxxxx Telerate
Services, the Reuters Monitor Money Rates Service or any other reliable interest
rate reporting service customarily used by financial institutions, as adjusted
from time to time in the holder's sole discretion, for then-applicable reserve
requirements, deposit insurance assessment rates, broker's commissions and other
regulatory costs.
2. The Maker (or if there shall be two Makers, each Maker) shall have
the right to prepay this Note in whole at any time or in part from time to time
with the following penalty on any amounts so prepaid.
3. All prepayments, mandatory or optional, shall be applied first to
payment of accrued interest and then to reduction of outstanding principal.
4. If any payment under this Note is not made when due, all unpaid
principal and accrued interest under this Note may, at the option of the holder,
be declared immediately due and payable. If proceedings under the federal
Bankruptcy Code or under any other law, state or federal, for the relief of
debtors are filed by or against the Maker (or if there shall be two Makers,
either Maker) and not dismissed within 60 days after filing, all such principal
and accrued interest shall become immediately due and payable without
declaration or notice of any kind. No failure by the holder of this Note to
exercise any right hereunder shall be or be deemed to be a waiver of such right
or of any remedy consequent thereon.
5. Maturity of this Note may be accelerated, the rate of interest borne
hereby may be increased and late fees may be imposed, all as provided in the
Participation Agreement of even date herewith between United Dominion Realty
Trust, Inc. (the "Company") and the Maker (the "Participation Agreement"). The
Maker shall pay any increase in the interest rate or late fees pursuant to the
Participation Agreement to the Company.
6. Presentment, demand and notice of dishonor are hereby waived, and
the Maker agrees (or if there shall be two Makers, both jointly and severally
agree) to be bound for the payment hereof notwithstanding any agreement for the
extension of the due date of any payment made by the holder after the maturity
thereof.
7. The Maker agrees (or if there shall be two Makers, both jointly and
severally agree) to pay all collection expenses, court costs and reasonable
attorneys' fees incurred in collection of this Note or any part hereof.
References to the Maker or Makers shall include the Maker or Makers and all
endorsers, sureties, guarantors and other obligors hereon.
__________________________________(SEAL)
{{Participant}}
EXHIBIT B-2
PROMISSORY NOTE
(Crestar - Fixed)
${{Number}} Richmond, Virginia
July 12 , 1999
FOR VALUE RECEIVED, the undersigned ("Maker"), promises (or if there
shall be two Makers, both jointly and severally promise) to pay to the order of
CRESTAR BANK, on June __, 2004, at such place as the holder hereof may designate
in writing, in lawful money of the United States of America, the principal sum
of {{Amount}} and no/100 Dollars (${{Number}}), with interest thereon payable in
arrears on the first days of each February, May, August and October until this
Note is paid in full, at the rate set forth below.
1. Interest shall be payable at 7.68% per annum.
2. The Maker (or if there shall be two Makers, each Maker) shall have
the right to prepay this Note in whole at any time or in part from time to time
with the following penalty on any amounts so prepaid.
3. All prepayments, mandatory or optional, shall be applied first to
payment of accrued interest and then to reduction of outstanding principal.
4. If any payment under this Note is not made when due, all unpaid
principal and accrued interest under this Note may, at the option of the holder,
be declared immediately due and payable. If proceedings under the federal
Bankruptcy Code or under any other law, state or federal, for the relief of
debtors are filed by or against the Maker (or if there shall be two Makers,
either Maker) and not dismissed within 60 days after filing, all such principal
and accrued interest shall become immediately due and payable without
declaration or notice of any kind. No failure by the holder of this Note to
exercise any right hereunder shall be or be deemed to be a waiver of such right
or of any remedy consequent thereon.
5. Maturity of this Note may be accelerated, the rate of interest borne
hereby may be increased and late fees may be imposed, all as provided in the
Participation Agreement of even date herewith between United Dominion Realty
Trust, Inc. (the "Company") and the Maker (the "Participation Agreement"). The
Maker shall pay any increase in the interest rate or late fees pursuant to the
Participation Agreement to the Company.
6. Presentment, demand and notice of dishonor are hereby waived, and
the Maker agrees (or if there shall be two Makers, both jointly and severally
agree) to be bound for the payment hereof notwithstanding any agreement for the
extension of the due date of any payment made by the holder after the maturity
thereof.
7. The Maker agrees (or if there shall be two Makers, both jointly and
severally agree) to pay all collection expenses, court costs and reasonable
attorneys' fees incurred in collection of this Note or any part hereof.
References to the Maker or Makers shall include the Maker or Makers and all
endorsers, sureties, guarantors and other obligors hereon.
__________________________________(SEAL)
{{Participant}}
