SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
___________________________
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
___________________________
Century Realty Trust
(Exact name of registrant as specified in its charter)
Indiana 35-1284316
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
____________________________
823 Chamber of Commerce Building John I. Bradshaw, Jr.
Indianapolis, Indiana 46204 Chief Executive Officer
(317) 632-5467 823 Chamber of Commerce Building
(Address, including zip code, and telephone Indianapolis, Indiana 46204
number, including area code, of (317) 632-5467
registrant's principal executive offices)(Name, address, including zip code, and
telephone number, including area
code, of Agent for Service)
______________________________
With copies to:
Robert T. Wildman Esq.
O. Wayne Davis, Esq.
Henderson, Daily, Withrow & DeVoe
One Indiana Square, Suite 2600
Indianapolis, Indiana 46204
(317) 639-4121
______________________________
Approximate date of commencement of proposed sale to public: From time to time
after this Registration Statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. { }
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act,
other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. {X}
If the Form is filed to register additional securities for an offering pursuant
to Rule 462(b) under the Securities Act, please check the following box and
list the Securities Act registration statement number of the earlier
registration statement for the same offering. { }
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. { }
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. { }
CALCULATION OF REGISTRATION FEE
_____________________________________________________________________________
TITLE OF SHARES AMOUNT TO BE PROPOSED PROPOSED AMOUNT OF
TO BE REGISTERED REGISTERED MAXIMUM MAXIMUM REGISTRATION FEE
OFFERING PRICE AGGREGATE
PER UNIT (1) OFFERING PRICE(1)
______________________________________________________________________________
Shares of 286,908 (2) $12.59 $3,612,172.00 $1,004.00
Beneficial
Interest
______________________________________________________________________________
(1) Calculated pursuant to Rule 457(c) under the Securities Act of 1933, as
amended, based on the average of the bid and asked price on August 26,
1999, as reported on the OTC Electronic Bulletin Board.
(2) All of these shares of Beneficial Interest are issuable in exchange for
Operating Partnership Units of Barcelona Apartments, L.P., Beech Grove
Apartments, L.P., Hampton Court Apartments, L.P., Sheffield Square
Apartments, L.P., and WestWind Terrace Apartments, L.P.
The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a)
may determine.
The information in this Prospectus is not complete and may be changed.
The shares of beneficial interests may not be sold until the registration
statement filed with the Securities and Exchange Commission is effective.
This prospectus is not an offer to sell the securities and it is not soliciting
an offer to buy these securities in any state where the offer or sale is not
permitted.
Subject to Completion, Dated August 30, 1999
CENTURY REALTY TRUST
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
(317) 632-5467
286,908 Shares Of Beneficial Interest
The selling shareholders described in this prospectus may offer and sell
from time to time up to 286,908 shares of beneficial interests, no par value,
of Century Realty Trust. Century Realty Trust will not receive any proceeds
from the sale of such shares of beneficial interest.
The selling shareholders may sell the shares of beneficial interest
offered hereby from time to time on the Nasdaq SmallCap Market on which the
shares of beneficial interest are traded, through negotiated transactions or
otherwise at market prices prevailing at the time of the sale or at negotiated
prices.
The shares of beneficial interests commenced trading on August 27, 1999
on the Nasdaq SmallCap Market, under the symbol "CRLTS." On August 27, 1999,
the average of the bid and asked prices of the shares of beneficial interests
on the Nasdaq SmallCap Market was $12.59 per share.
See "Risk Factors" beginning on page 4 for information you should consider
before investing in the shares of beneficial interest.
Neither the Securities And Exchange Commission nor any state Securities
Commission has approved or disapproved these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
Prospectus dated ___________, 1999
TABLE OF CONTENTS
Pages
Summary 3
Risk Factors 4
The Trust 10
Use of Proceeds 10
Selling Shareholders 11
Plan of Distribution 12
Certain Federal Income Tax Consequences 13
Where You Can Find More Information 25
Legal Matters 26
Experts 26
In this prospectus, "CRT", "we", "us" and "our" refer to Century Realty
Trust and its consolidated subsidiaries, CR Management, Inc. and Charter Oaks
Associates, LLC.
SUMMARY
All of the 286,908 shares of beneficial interest which may be sold under
this prospectus are issuable in exchange for operating partnership units
("OPU's") in five of our limited partnerships. The OPU's are exchangeable for
shares of beneficial interest on a 1 to 1 basis at the election of the holders.
The OPU's were issued in connection with the acquisition of five apartment
complexes in 1997. See "Selling Shareholders" for additional information
concerning the exchange of OPU's for shares of beneficial interest and the
selling shareholders.
RISK FACTORS
Before you invest in our securities, you should be aware that there are
various risks, including those described below. You should consider carefully
these risk factors together with all of the other information included in this
prospectus before you decide to purchase our securities.
Some of the information in this prospectus may contain forward-looking
statements. Such statements can be identified by the use of forward-looking
words such as "may," "will," "expect," "anticipate," "estimate," "continue" or
other similar words. These statements discuss future expectations, contain
projections of results of operations or financial condition or state other
"forward-looking" information. When considering such forward-looking
statements, you should keep in mind the risk factors and other cautionary
statements in this prospectus. The risk factors noted in this section and other
factors noted throughout this prospectus, including certain risks and
uncertainties, could cause our actual results to differ materially from those
contained in any forward-looking statement.
Significant Tax Penalty
Our inability to overturn a penalty in the amount of $151,400 assessed
against us by the Internal Revenue Service could have an adverse effect upon
our financial condition. The penalty was for our alleged failure to correctly
or timely file information returns regarding dividends we paid in 1996. We
believe that the returns in question were timely filed, were correct when
submitted and that the assessed penalty is unjustified. We are currently
pursuing our administrative appeal rights with the Internal Revenue Service and
as a result of the uncertainty concerning the ultimate outcome, no liability
has been recorded in our financial statements for this matter. There can be
no assurance, however, that we will be successful in our appeal.
Risks Of Acquisition Activities
The selective acquisition of apartment properties is one component of our
growth strategy. However, we can provide no assurance as to our ability to
complete transactions in the future. Although we seek to acquire properties
only when such activities are accretive on a per share basis, such transactions
may fail to perform in accordance with our expectations.
We May Have Difficulty Managing Our Growth. We have expanded our portfolio
of owned and controlled apartment properties from nine apartment properties
with 1,358 units as of December 31, 1996 to 15 apartment properties with 2,136
units as of June 30, 1999. These acquisitions have included purchases of
properties and interests in entities that own properties. Our ability to
successfully integrate acquired properties depends on our ability to:
- attract and retain qualified personnel;
- maintain uniform standards, controls, procedures and policies; and
- maintain adequate accounting and information systems.
We can provide no assurance that we will be able to accomplish these goals
and successfully integrate any acquired properties. If we fail to successfully
integrate such properties, our results of operations could be adversely
affected.
Our Size May Restrict Our Ability to Acquire Additional Properties
We compete for the acquisition of properties with other entities many of
which are larger and have greater financial resources than us. We may also
have to raise additional equity in order to acquire new properties which cannot
be assured.
Risks Associated With Debt Financing
Our strategy is generally to incur debt to increase the return on our
equity while maintaining acceptable debt service coverage ratios. Our
organizational documents do not limit the amount of debt that we may incur,
and we have significant amounts of debt outstanding. Payments of principal
and interest may leave us with insufficient cash resources to operate our
properties or pay distributions required to be paid in order to maintain our
qualification as a real estate investment trust or REIT. We are also subject
to the risk that our cash flow from operations will be insufficient to make
required payments of principal and interest, and the risk that existing
indebtedness may not be refinanced or that the terms of any refinancing will
not be as favorable as the terms of existing indebtedness. If we fail to make
required payments of principal and interest on any debt, our lenders could
foreclose on the properties securing such debt with a consequent loss of
income and asset value to us. As of June 30, 1999, 10 of the 15 properties
that we own were encumbered by mortgages. As of June 30, 1999, we had
$35,485,941 of indebtedness outstanding on a consolidated basis, of which
$35,385,941 was secured.
Increases In Interest Rates May Increase Our Interest Expense
As of June 30, 1999, approximately $ 1,220,000 of our debt was subject to
variable interest rates. An increase in interest rates could increase our
interest expense and adversely affect our cash flow and our ability to service
our indebtedness and make distributions.
Real Estate Investment Risks
Our ability to make payments to our shareholders depends on our ability
to generate funds from operations in excess of required debt payments and
capital expenditure requirements. Funds from operations and the value of our
properties may be adversely affected by events or conditions which are beyond
our control. Such events or conditions could include:
- the general economic climate;
- competition from other apartment communities and alternative housing;
- local conditions, such as an increase in unemployment or an oversupply
of apartments, that might adversely affect apartment occupancy or
rental rates;
- increases in operating costs (including real estate taxes) due to
inflation and other factors, which may not necessarily be offset by
increased rents:
- changes in governmental regulations and the related costs of compliance:
- changes in tax laws and housing laws, including the enactment of rent
control laws or other laws regulating multifamily housing;
- changes in interest rate levels and the availability of financing; and
- the relative illiquidity of real estate investments.
Our Assets Lack Diversity
Approximately 95% of our income is derived from the rental of apartment
complexes which we own or control. All of these properties are located in
Indiana. Accordingly, our results of operations are dependent upon the economy
of the Indiana and Great Lakes region and we lack the benefits which geographic
diversity might provide.
Possible Environmental Liabilities
Various Federal, state and local laws subject property owners or operators
to liability for the costs of removal or remediation of certain hazardous
substances released on a property. Such laws often impose liability without
regard to whether the owner or operator knew of, or was responsible for, the
release of the hazardous substances. The presence of, or the failure to
properly remediate, hazardous substances may adversely affect occupancy at
contaminated apartment communities and our ability to sell or borrow against
contaminated properties. In addition to the costs associated with
investigation and remediation actions brought by governmental agencies, the
presence of hazardous wastes on a property could result in personal injury or
similar claims by private plaintiffs. Various laws also impose liability for
the cost of removal or remediation of hazardous or toxic substances at the
disposal or treatment facility. Anyone who arranges for the disposal or
treatment of hazardous or toxic substances is potentially liable under such
laws. These laws often impose liability whether or not the person arranging
for the disposal ever owned or operated the disposal facility.
Laws Benefiting Disabled Persons May Result In Unanticipated Expenses
Under the Americans with Disabilities Act of 1990 (the "ADA"), all places
of public accommodation are required to meet certain Federal requirements
related to access and use by disabled persons. These requirements became
effective in 1992. A number of additional Federal, state and local laws may
also require modifications to our properties, or restrict certain further
renovations of the properties, with respect to access thereto by disabled
persons. For example, the Fair Housing Amendments Act of 1988 (the "FHAA")
requires apartment properties first occupied after March 13, 1990 to be
accessible to the handicapped. Noncompliance with the ADA or the FHAA could
result in the imposition of fines or an award of damages to private litigants
and also could result in an order to correct any non-complying feature,
which could result in substantial capital expenditures. Although we believe
that our properties are substantially in compliance with present requirements,
we may incur unanticipated expenses to comply with the ADA and the FHAA.
Our Capital Expenditure Reserve May Not Be Adequate
If we are required to make capital improvements and repairs on our
portfolio properties in excess of amounts we have reserved for that purpose,
our financial condition and results of operation could be adversely affected.
While we believe our reserves for this purpose are adequate, the establishment
of such reserves involve certain assumptions and estimates and hence are
inherently uncertain.
Dependence On Certain Executive Officers
The loss of services of John I. Bradshaw, Jr., President, Chief Executive
Officer and treasurer or David F. White, Controller, could have an adverse
effect on our operations.
Our Shares Have a Limited Trading Market
Sales of substantial numbers of shares of beneficial interest in the
public market could adversely effect the market price of the shares. As of
July 31, 1999, we had 1,547,614 shares of beneficial interest outstanding
which were held by approximately 3,175 shareholders of record. The average
weekly over-the-counter trading volume of our shares has been approximately
3,000 shares during the last six months.
Tax Risks
Adverse Consequences of Failure to Qualify as a REIT. Although we believe
that we operate in a manner that enables us to meet the requirements for
qualification as a REIT for Federal income tax purposes, we have not and do
not plan to request a ruling from the IRS that we qualify as a REIT. We have,
however, received an opinion from Henderson, Daily, Withrow & DeVoe
("Henderson Daily") to the effect that we were organized in conformity with
the requirements for qualification as a REIT under the Internal Revenue Code
and that our actual method of operation has enabled, and our proposed method of
operation will enable, us to meet the requirements for qualification and
taxation as a REIT. The opinion is expressed as of its date and Henderson Daily
has no obligation to advise us of any change in applicable law or of any
change in matters stated, represented or assumed after the date of such
opinion.
You should be aware that opinions of counsel are not binding on the IRS
or any court. This opinion is based upon certain representations and covenants
made by us regarding our properties and the past, present and future conduct
of our business operations. Furthermore, this opinion is conditioned on, and
our qualification and taxation as a REIT depends on, our ability to meet,
through actual annual operating results, the various REIT qualification
tests, the results of which are not reviewed by Henderson Daily. Accordingly,
no assurance can be given that the actual results of our operations for any
taxable year satisfy such requirements. Such requirements are discussed in
more detail under the heading "Certain Federal Income Tax Consequences."
If we fail to qualify as a REIT, we would not be allowed a deduction for
dividends paid to our shareholders in computing our taxable income and we would
be subject to Federal income tax at regular corporate rates. We also could be
subject to the Federal alternative minimum tax. Unless we are entitled to
relief under the tax law, we could not elect to be taxed as a REIT for four
years following the year during which we were disqualified. Therefore, if
we lose our REIT status, the funds available for payment to our shareholders
would be reduced substantially for each of the years involved, as further
explained in "Certain Federal Income Tax Consequences." As a result of the
additional tax liability, we might need to borrow funds or liquidate certain
investments on terms that may be disadvantageous to us in order to pay the
applicable tax; and we would not be compelled to make distributions under
the Internal Revenue Code.
Effect of Distribution Requirements. As a REIT, we are subject to annual
distribution requirements, which limit the amount of cash we have available
for other business purposes, including amounts to fund our growth.
Possible Legislative or Other Actions Affecting REITs. The rules
dealing with Federal income taxation are constantly under review by persons
involved in the legislative process and by the IRS and the U.S. Treasury
Department. Changes to the tax law (which changes may have retroactive
application) could adversely affect our shareholders. We cannot predict how
changes in the tax law might affect us or our shareholders.
Other Tax Liabilities. Even if we qualify as a REIT, we may be subject
to certain Federal, state and local taxes on our income and property. Any
such taxes would reduce our operating cash flow.
Possible Adverse Consequences Of Limits On Ownership Of Shares
Our Trust Instrument authorizes our trustees to either prevent the
transfer of shares of beneficial interest or redeem shares if they determine
in good faith that beneficial ownership of the shares has or will become
so concentrated as to prevent us from continuing to qualify as a REIT. This
could happen if a share transaction results in fewer than 100 persons owning
all of our shares or results in five or fewer persons, applying certain
attribution rules of the Internal Revenue Code, owning 50% or more of the
value of all of our shares. If you or anyone else acquires shares in excess
of the ownership limit or in violation of the ownership requirements of the
Internal Revenue Code for REITs:
- the transfer may be considered null and void;
- we may refuse to reflect the transaction on our books;
- we may institute legal action to enjoin the transaction; or
- we may redeem the shares.
We may purchase such shares at a price equal to the last bid quotation on
the day prior to the date of redemption as reported by Nasdaq SmallCap Market.
An individual who acquires shares that violate the above rules bears the risk
that he may lose control over the power to dispose of such shares.
Provisions May Limit The Ability Of A Third Party To Acquire Control
Of The Company
The ownership limits discussed above as well as the shareholder rights
plan which entitles each shareholder to purchase additional shares upon the
acquisition of or tender offer for 20% or more of the outstanding shares of
beneficial interest by a single person or group may have the effect of
precluding acquisition of control of us by a third party without the consent
of our board of trustees regardless of the price per share such person or
group is willing to pay. While our current rights plan expires by its terms
in October, 1999, it is presently contemplated that the plan will be extended
for an additional 5-year term by our board of trustees.
Risks Associated With The Year 2000 Issue
The most likely worst case scenario related to the year 2000 for us is
that the residents of our apartments may be unwilling or unable to pay rent.
Disruption in electric, heat and/or water service could prompt some residents
to temporarily withhold all or part of the rent due. Lost wages or payroll
delays due to year 2000 problems encountered by our residents' employers or
others upon whom those employers depend could jeopardize the ability of some
residents to pay rent.
In the event that unforeseen year 2000 problems arise in the accounting
systems used by us and/or independent management firms, essential functions
will be performed manually. Non-essential functions will be curtailed until
corrective measures are implemented. Contingency plans with respect to the
"most likely worst case scenario" have not yet been finalized. The objective
of such contingency planning is to enable us, in spite of a substantial
temporary decrease in revenue, to meet our debt service and payroll obligations
in January, 2000 and beyond, if necessary.
THE TRUST
Our principal business is the ownership of income producing real estate.
We currently own or control
15 apartment complexes
2 parcels leased to restaurants, and
3 commercial properties.
In 1997, we expanded our investment options to include the exclusive
control of real estate through the use of operating partnerships. Five of
our fifteen apartment properties are owned by operating partnerships. Our
subsidiary, CR Management, Inc., is the manager and sole general partner of
each of the five partnerships, each of which owns one apartment property as
its principal asset. As the sole general partner and pursuant to each
partnership agreement, we have full, exclusive and complete responsibility
and discretion in the management and control of each of these five partnerships.
Interests held by limited partners in the five real estate partnerships,
represented by 286,908 Operating Partnership units, are reflected in our
financial statements as minority interests in operating partnerships.
Other than long-term leases on the two restaurant properties, our rental
income is derived from short-term leases of units in our apartment and
commercial buildings.
The residential rental properties owned or controlled by us are managed
under agreements with independent property management firms. The agreements
provide for management fees based generally on gross rental collections. We
reimburse the management firms for compensation of approximately 65 persons
employed at the apartment properties.
We have elected to be treated as a real estate investment trust or REIT
under the Internal Revenue Code and to distribute substantially all of our
real estate investment trust taxable income. A real estate investment trust
is an investment vehicle which permits individuals, by purchasing shares, to
invest in real estate equities and/or mortgage loans, and share in the profits
therefrom without having such profits subjected to federal income taxes at
the trust level.
We directly provide all investor services for our shareholders and limited
partnership interests, including ownership transfers, distribution payments and
record keeping. Bank One Indiana, N.A (successor in interest to NBD Bank)
serves as independent registrar for our shares of beneficial interest.
USE OF PROCEEDS
The selling shareholders will receive all of the net proceeds from the
sale of shares of beneficial interest offered hereby. We will not receive any
proceeds from the sale of such shares.
SELLING SHAREHOLDERS
This prospectus relates to periodic offers and sales of up to 286,908
shares of beneficial interest issuable by us in exchange for Operating
Partnership Units or OPU's of Barcelona Apartments, L.P. (13,608 OPU's),
Beech Grove Apartments, L.P. (113,080 OPU's), Hampton Court Apartments, L.P.
(37,914 OPU's), Sheffield Square Apartments, L.P. (91,130 OPU's) and WestWind
Terrace Apartments, L.P. (31,176 OPU's) pursuant to the acquisition agreement
between us and each such partnership.
In 1997 we acquired, through CR Management, Inc., the general partner
interest in five limited partnerships in exchange for cash. Each of these
partnerships owned an apartment complex (the "Selling Partnerships"). We
then formed the five new limited partnerships (the "Acquiring Partnerships")
listed above, with CR Management, Inc. as the general partner. Each Acquiring
Partnership acquired the apartment complex of one of the Selling Partnerships
in exchange for the assumption of certain liabilities and the issuance of
OPU's. The result was that a Selling Partnership ended up owning OPU's
representing the sole limited partner interest in one of the Acquiring
Partnerships, instead of an apartment complex. Under the terms of the
acquisition agreements:
we are obligated to use our best efforts to afford each Selling
Partnership the opportunity to convert or exchange its OPU's for
shares of beneficial interest (or, at our option we may pay cash
instead of issuing shares) on a one-for-one basis at reasonable
intervals after November 21, 1999, and
we may force such a conversion or exchange at any time after
November 21, 2007.
Each Selling Partnership intends to liquidate and distribute its OPU's
to its limited partners on a pro rata basis. If all of the OPU's are converted,
we will issue a total of 286,908 shares of beneficial interest which would
constitute approximately 15.6% of our issued and outstanding shares. The
selling shareholders are those limited partners who exchange their OPU's for
shares of beneficial interest and subsequently decide to sell such shares.
None of the selling shareholders holds any position, office or has had
any other material relationship with us or any of our affiliates, during the
past three years. All of the shares owned by the selling shareholders may be
offered hereby. Because the selling shareholders may sell some or all of the
shares offered hereby, and because there are currently no agreements,
arrangements or understandings with respect to the sale of any of such shares,
no estimate can be given as to the number of shares that will be held by the
selling shareholders upon termination of any offering made hereby. If all of
the shares offered hereby are sold, the selling shareholders will not own any
shares after the offering.
PLAN OF DISTRIBUTION
The selling shareholders may sell or distribute the shares offered by
this prospectus directly to purchasers as principals or through one or more
underwriters, brokers, dealers or agents from time to time in one or more
transactions. These transactions may involve crosses or block transactions.
The selling shareholders may also sell or distribute the shares offered herein:
(i) in the over-the-counter market;
(ii) in transactions other than in the over-the-counter market;
(iii) through the writing of put or call options (whether those
options are listed on an options exchange or otherwise)
relating to the shares offered by this prospectus, or the
short sales of the offered shares;
(iv) through the distribution of the shares to its partners, members
or shareholders; or
(v) through any combination of the above.
Any of those transactions may be conducted at market prices prevailing at the
time of sale, at prices related to the prevailing market prices, at varying
prices determined at the time of sale or at negotiated or fixed prices, in each
case as determined by the selling shareholders or by agreement between the
selling shareholders and underwriters, brokers, dealers or agents, or
purchasers. If the selling shareholders effect transactions by selling
securities to or through underwriters, brokers, dealers or agents, those
underwriters, brokers, dealers or agents may receive compensation in the form
of discounts, concessions or commissions from the selling shareholders or
commissions from purchasers of securities for whom it may act as agent (which
discounts, concessions or commissions as to particular underwriters, brokers,
dealers or agents may be in excess of those customary in the types of
transactions involved). The selling shareholders and any brokers, dealers or
agents that participate in the distribution of the securities may be deemed
to be underwriters, and any profit on the sale of the securities by them and
any discounts, concessions or commissions received by any underwriters,
brokers, dealers or agents may be deemed to be underwriting discounts and
commissions under the Securities Act.
The shares of beneficial interests may be sold in certain states only
through registered or licensed brokers or dealers. In addition, the securities
may not be sold in certain states unless the securities have been registered
or qualified for sale therein or an exemption from registration or qualification
is available and is complied with.
The selling shareholders may also resell all or a portion of the securities
in open market transactions in reliance upon Rule 144 under the Securities Act,
provided they meet the criteria and conform to the requirements of such Rule.
We will pay all of the costs, expenses and fees incident to the
registration, offering and sale of the shares of beneficial interest to the
public hereunder other than commissions, fees and discounts of underwriters,
brokers, dealers and agents. However, we may charge such expenses to the
selling shareholders upon their exchange of OPU's for shares of beneficial
interest in an amount not to exceed 10% of the market value of the shares at
the time of exchange. We will not receive any of the proceeds from the sale of
any of the shares of beneficial interest by the selling shareholders.
CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The following is a summary of certain Federal income tax consequences
regarding an investment in the shares of beneficial interest. This
is based upon the Internal Revenue Code of 1986, as amended (the "Internal
Revenue Code"), the regulations promulgated by the U.S. Treasury Department
thereunder (the "Treasury Regulations"), rulings issued by the IRS, and judicial
decisions, all in effect as of the date of this prospectus and all of which
are subject to differing interpretation or change, possibly retroactively.
This discussion is for general information only, and does not purport to
discuss all aspects of Federal income taxation which may be important to a
particular investor in light of the investor's investment or tax circumstances,
or to certain types of investors subject to special tax rules (including
investment companies, financial institutions, broker-dealers, insurance
companies and, except to the extent discussed below, tax-exempt organizations
and foreign investors as determined for Federal income tax purposes). This
summary assumes that investors will hold their shares of beneficial interest
as "capital assets" (generally, property held for investment). No advance
ruling has been or will be sought from the IRS regarding any matter discussed
herein.
The federal income tax treatment of holders of shares of beneficial
interest depends in some instances on determinations of fact and interpretations
of complex provisions of Federal income tax law for which no clear precedent
or authority may be available. Each prospective investor should consult the
investor's tax advisor regarding the Federal, State, local and foreign tax
consequences of acquiring, holding, exchanging, or otherwise disposing of
shares of beneficial interest and of our election to be subject to tax, for
Federal income tax purposes, as a real estate investment trust.
Taxation Of CRT
General. The REIT provisions of the Internal Revenue Code are highly
technical and complex. The following summary sets forth certain aspects of
the provisions of the Internal Revenue Code that govern the Federal income
tax treatment of a REIT and its shareholders. This summary is qualified in
its entirety by the applicable Internal Revenue Code provisions, Treasury
Regulations, and administrative and judicial interpretations thereof, all
of which are subject to differing interpretation or change, possibly
retroactively.
We have elected to be taxed as a REIT under the Internal Revenue Code
commencing with our taxable year ending December 31, 1978, and we intend to
continue such election. We believe that, and we have received an opinion from
Henderson Daily to the effect that, we have made an effective election for
qualification as a REIT, and that our actual method of operation has enabled,
and our proposed method of operation will enable, us to meet the requirements
for qualification and taxation as a REIT under the Internal Revenue Code. It
must be emphasized that this opinion is based and conditioned upon certain
assumptions and representations and covenants made by us as to factual matters
(including representations and covenants concerning our properties and the past,
present and future conduct of our business operations). The opinion is expressed
as of its date and counsel has no obligation to advise us of any subsequent
change in the matters stated, represented or assumed or any subsequent change
in the applicable law. Moreover, the opinion is conditioned on, and our
qualification and taxation as a REIT depend upon, our ability to meet, through
actual annual operating results, distribution levels and diversity of stock
ownership, the various qualification tests imposed under the Internal Revenue
Code as discussed below. No assurance can be given that our actual results
of operations for any one taxable year satisfy such requirements. See
"-- Failure to Qualify." This opinion is not binding on the IRS, and no
assurance can be given that the IRS will not challenge our eligibility for
taxation as a REIT.
Provided we qualify for taxation as a REIT, we will generally not be
subject to Federal corporate income tax on our net income that is currently
distributed to our shareholders. This treatment substantially eliminates the
"double taxation" (at the corporate and shareholder levels) that generally
results from investment in a corporation. However, notwithstanding our
qualification as a REIT, we will be subject to Federal income tax as
follows: First, we will be taxed at regular corporate rates on any
undistributed REIT taxable income, including undistributed net capital
gains. Second, under certain circumstances, we may be subject to the
"alternative minimum tax" on any items of tax preference. Third, if we
have net income from prohibited transactions (which are, in general,
certain sales or other dispositions of property held primarily for sale to
customers in the ordinary course of business other than foreclosure property),
such income will be subject to a 100% tax. Fourth, if we should fail to satisfy
the 75% gross income test or the 95% gross income test (as discussed below),
but have nonetheless maintained our qualification as a REIT because certain
other requirements have been met, we will be subject to a 100% tax on an
amount equal to (a) the gross income attributable to the greater of the
amount by which we fail the 75% or 95% test multiplied by (b) a fraction
intended to reflect our profitability. Fifth, if we should fail to distribute
during each calendar year at least the sum of (i) 85% of our REIT ordinary
income for such year, (ii) 95% of our REIT capital gain net income for such
year (other than certain long-term capital gains that we elect to retain and
pay the tax thereon), and (iii) any undistributed taxable income from prior
periods, we would be subjected to a 4% excise tax on the excess of such
required distribution over the amounts actually distributed. Sixth, if we
acquire assets from a corporation that is not a REIT (a "C corporation") in
a transaction in which the adjusted tax basis of the assets in our hands
determined by reference to the adjusted tax basis of such assets in the
hands of the C corporation, under Treasury Regulations not yet promulgated,
the C corporation would be required to recognize any net Built-In Gain
(as defined below) that would have been realized if the C corporation
had liquidated on the day before the date of the transfer. Pursuant to
IRS Notice 88-19, we may elect, in lieu of the treatment described above,
to be subject to tax at the highest regular corporate tax rate on any gain
we recognize on the disposition of any such asset during the ten-year
period beginning on the day on which we acquire such asset to the extent of
the excess, if any, of the fair market value over the adjusted basis of such
asset as of its acquisition date ("Built-in Gain"). It should be noted that
we have not acquired (and do not intend to acquire in the future) any assets
with Built-in Gain. In addition, we could also be subject to tax in certain
situations and on certain transactions not presently contemplated.
Requirements for Qualification. The Internal Revenue Code defines a REIT
as a corporation, trust or association (1) that is managed by one or more
trustees or directors; (2) the beneficial ownership of which is evidenced by
transferable shares, or by transferable certificates of beneficial interest;
(3) which would be taxable as a domestic corporation, but for the special
Internal Revenue Code provisions applicable to REITs; (4) that is neither a
financial institution nor an insurance company subject to certain provisions
of the Internal Revenue Code; (5) the beneficial ownership of which is held
by 100 or more persons; (6) in which, during the last half of each taxable
year, not more than 50% in value of the outstanding stock is owned, directly
or indirectly, by five or fewer individuals (as defined in the Internal Revenue
Code to include certain entities); and (7) which meets certain other tests
described below (including with respect to the nature of its income and
assets). The Internal Revenue Code provides that conditions (1) through (4)
must be met during the entire taxable year, and that condition (5) must be
met during at least 335 days of a taxable year of 12 months, or during a
proportionate part of a taxable year of less than 12 months. Our Trust
Instrument provides certain restrictions regarding transfers of our shares,
which provisions are intended to assist us in satisfying the share ownership
requirements described in conditions (5) and (6) above.
To monitor our compliance with the share ownership requirements, we
are required to maintain records regarding the actual ownership of our shares.
To do so, we must demand written statements each year from the record holders
of certain percentages of our shares of beneficial interest in which the
record holders are to disclose the actual owners of the shares (i.e., the
persons required to include in gross income the dividends paid by us). A
list of those persons failing or refusing to comply with this demand must
be maintained as part of our records. A shareholder who fails or refuses
to comply with the demand must submit a statement with its tax return
disclosing the actual ownership of the shares and certain other information.
Ownership of Partnership Interests. In the case of a REIT that is a
partner in a partnership, Treasury Regulations provide that the REIT is
deemed to own its proportionate share of the partnership's assets and to
earn its proportionate share of the partnership's income. In addition, the
assets and gross income of the partnership retain the same character in the
hands of the REIT for purposes of the gross income and asset tests applicable
to REITs as described below. Thus, our proportionate share of the assets,
liabilities and items of income of the partnerships in which we have ownership
interests (the "Subsidiary Partnerships") generally will be treated as our
assets, liabilities and items of income for purposes of applying the REIT
requirements described herein. A summary of certain rules governing the
Federal income taxation of partnerships and their partners is provided below
in "Tax Aspects of CRT's Investments in Partnerships."
Income Tests. In order to maintain qualification as a REIT, we annually
must satisfy two gross income requirements. First, at least 75% of our gross
income (excluding gross income from "prohibited transactions," i.e., certain
sales of property held primarily for sale to customers in the ordinary course
of business) for each taxable year must be derived directly or indirectly from
investments relating to real property or mortgages on real property (including
"rents from real property" and, in certain circumstances, interest) or from
certain types of temporary investments. Second, at least 95% of our gross
income (excluding gross income from prohibited transactions) for each taxable
year must be derived from such real property investments, and from dividends,
interest and gain from the sale or disposition of stock or securities (or from
any combination of the foregoing).
Rents received by us through the Subsidiary Partnerships will qualify as
"rents from real property" in satisfying the gross income requirements described
above, only if several conditions are met, including the following. If rent
attributable to personal property leased in connection with a lease of real
property is greater than 15% of the total rent received under the lease, then
the portion of rent attributable to such personal property will not qualify
as "rents from real property." Moreover, for rents received to qualify as
"rents from real property," the REIT generally must not operate or manage
the property or furnish or render services to the tenants of such property,
other than through an "independent contractor" from which the REIT derives
no revenue. However, we (or our affiliates) are permitted to directly perform
services that are "usually or customarily rendered" in connection with the
rental of space for occupancy only and are not otherwise considered rendered
to the occupant of the property. In addition, we (or our affiliates) may
provide noncustomary services to tenants of our properties without disqualifying
all of the rent from the property if the payment for such services does not
exceed 1% of the total gross income from the property. For purposes of this
test, the income received from such non-customary services is deemed to be
at least 150% of the direct cost of providing the services.
If we fail to satisfy one or both of the 75% or 95% gross income tests
for any taxable year, we may nevertheless qualify as a REIT for such year if
we are entitled to relief under certain provisions of the Internal Revenue
Code. These relief provisions are generally available if our failure to meet
such tests was due to reasonable cause and not due to willful neglect, we
attach a schedule of the sources of our income to our return, and any incorrect
information on the schedule was not due to fraud with intent to evade tax. It
is not possible, however, to state whether in all circumstances we would be
entitled to the benefit of these relief provisions. If these relief provisions
are inapplicable to a particular set of circumstances involving us, we will
not qualify as a REIT. As discussed above in "-- General," even where these
relief provisions apply, a tax is imposed with respect to the excess net
income.
Asset Tests. We, at the close of each quarter of our taxable year, must
also satisfy three tests relating to the nature of our assets. First, at
least 75% of the value of our total assets must be represented by real estate
assets (including our allocable share of real estate assets held by the
Subsidiary Partnerships), certain stock or debt instruments purchased by us
with new capital, cash, cash items and U.S. government securities. Second,
not more than 25% of our total assets may be represented by securities other
than those in the 75% asset class. Third, of the investments included in the
25% asset class, the value of any one issuer's securities owned by us may not
exceed 5% of the value of our total assets, and we may not own more than 10%
of any one issuer's outstanding voting securities.
Our interests in the Subsidiary Partnerships are held through a wholly
owned corporate subsidiary of CRT organized and operated as a qualified REIT
subsidiary within the meaning of the Internal Revenue Code. Qualified REIT
subsidiaries are not treated as separate entities from their parent REIT
for Federal income tax purposes. Instead, all assets, liabilities and items
of income, deduction and credit of our qualified REIT subsidiary are treated
as assets, liabilities and items of CRT. Our qualified REIT subsidiary
therefore is not subject to Federal corporate income taxation, although it
may be subject to state or local taxation. In addition, our ownership of
the voting stock of the qualified REIT subsidiary does not violate the
general restriction against ownership of more than 10% of the voting
securities of any issuer.
Annual Distribution Requirements. In order for us to qualify as a REIT,
we are required to distribute dividends (other than capital gain dividends)
to our shareholders in an amount at least equal to (A) the sum of (i) 95% of
our "REIT taxable income" (computed without regard to the dividends paid
deduction and our net capital gain) and (ii) 95% of the net income (after
tax), if any, from foreclosure property, minus (B) the sum of certain items
of noncash income. Such distributions must be paid in the taxable year to
which they relate, or in the following taxable year if declared before we
timely file our tax return for such year and if paid with or before the
first regular dividend payment after such declaration. To the extent that
we distribute at least 95%, but less than 100%, of our "REIT taxable
income," as adjusted, the undistributed portion will be subject to tax
thereon at ordinary corporate tax rates.
We may elect to retain, rather than distribute, our net long-term capital
gains and pay the tax on such gains. In such a case, our shareholders would
include their proportionate share of such undistributed long-term capital
gains in income and receive a credit for their share of the tax paid by us.
Our shareholders would then increase the adjusted basis of their CRT shares
by the difference between the designated amounts included in their long-term
capital gains and the tax deemed paid with respect to their shares. If we
should fail to distribute during each calendar year at least the sum of
(i) 85% of our REIT ordinary income for such year and (ii) 95% of our REIT
capital gain net income for such year (excluding retained long-term capital
gains), and (iii) any undistributed taxable income from prior periods, we
would be subject to a 4% excise tax on the excess of such required distribution
over the amounts actually distributed. We believe that we have made, and we
intend to make, timely distributions sufficient to satisfy these annual
distribution requirements.
It is possible that we, from time to time, may not have sufficient
cash to meet the 95% distribution requirement due to timing differences
between (i) the actual receipt of cash (including receipt of distributions
from the Subsidiary Partnerships) and (ii) the inclusion of certain items
in income by us for Federal income tax purposes. In the event that such
timing differences occur, in order to meet the 95% distribution requirement,
we may find it necessary to arrange for short-term, or possibly long-term,
borrowings, or to pay dividends in the form of taxable distributions of
property.
Under certain circumstances, we may be able to rectify a failure to meet
the distribution requirement for a year by paying "deficiency dividends" to
shareholders in a later year, which may be included in our deduction for
dividends paid for the earlier year. Thus, we may be able to avoid being
taxed on amounts distributed as deficiency dividends; however, we will be
required to pay interest and a penalty based on the amount of any deduction
taken for deficiency dividends.
Distribution of Acquired Earnings and Profits. The Internal Revenue Code
provides that when a REIT acquires a corporation that is currently a C
corporation (i.e., a corporation without an effective REIT election), the
REIT may qualify as a REIT only if, as of the close of the year of acquisition,
the REIT has no "earnings and profits" acquired from such C corporation. Any
adjustments to the acquired corporation's income for taxable years ending on
or before the closing of the acquisition, including as a result of an
examination of its returns by the IRS, could affect the calculation of the
acquired corporation's earnings and profits. The determination of earnings
and profits requires the resolution of certain technical tax issues with
respect to which there is no authority directly on point and, consequently,
the proper treatment of these issues for earnings and profits purposes is
not free from doubt.
We have not acquired a C corporation in the past and we have no present
intention or plans to acquire a C corporation in the future.
Failure to Qualify. If we fail to qualify for taxation as a REIT
in any taxable year, and the relief provisions do not apply, we will be
subject to tax (including any applicable alternative minimum tax) on our
taxable income at regular corporate rates. Distributions to shareholders
in any year in which we fail to qualify will not be deductible by us nor
will they be required to be made. In such event, to the extent of current
and accumulated earnings and profits, all distributions to shareholders
will be taxable as ordinary income, and, subject to certain limitations
of the Internal Revenue Code, corporate distributees may be eligible for
the dividends received deduction. Unless entitled to relief under specific
statutory provisions, we would also be disqualified from taxation as a REIT
for the four taxable years following the year during which qualification
was lost. It is not possible to state whether in all circumstances we would
be entitled to such statutory relief.
Tax Aspects Of Our Investments In Partnerships
General. Six of our apartment properties are held indirectly through
entities taxed as partnerships. In general, partnerships are "pass-through"
entities that are not subject to Federal income tax. Rather, partners are
allocated their proportionate shares of the items of income, gain, loss,
deduction and credit of a partnership, and are potentially subject to tax
thereon, without regard to whether the partners receive a distribution from
the partnership. We include in our income our proportionate share of the
foregoing partnership items for purposes of the various REIT income tests
and in the computation of our REIT taxable income. Moreover, for purposes
of the REIT asset tests, we include our proportionate share of assets held
by the Subsidiary Partnerships. See " - Taxation of CRT - Ownership of
Partnership Interest."
Entity Classification. Our investment in partnerships involves special
tax considerations, including the possibility of a challenge by the IRS of
the status of any of the Subsidiary Partnerships as a partnership (as opposed
to an association taxable as a corporation) for Federal income tax purposes.
If any of these entities were treated as an association for Federal income
tax purposes, it would be subject to an entity-level tax on its income.
In such a situation, the character of our assets and items of gross income
would change and could preclude us from satisfying the asset tests and the
income tests (see "-- Taxation of CRT -- Asset Tests" and "-- Taxation of
CRT -- Income Tests"), and in turn could prevent us from qualifying as a
REIT. See "-- Taxation of CRT -- Failure to Qualify" above for a discussion
of the effect of our failure to meet such tests for a taxable year. In
addition, any change in the status of any of the Subsidiary Partnerships
for tax purposes might be treated as a taxable event, in which case we might
incur a tax liability without any related cash distributions.
Sale of the Properties. Our share of any gain realized by any Subsidiary
Partnerships on the sale of any property held as inventory or primarily for
sale to customers in the ordinary course of business will be treated as income
from a prohibited transaction that is subject to a 100% penalty tax. See "--
Taxation of CRT -- Income Tests." Under existing law, whether property is held
as inventory or primarily for sale to customers in the ordinary course of a
partnership's trade or business is a question of fact that depends on all
the facts and circumstances with respect to the particular transaction. In
general, the Subsidiary Partnerships intend to hold the owned properties for
investment with a view to long-term appreciation, to engage in the business
of acquiring, developing, owning, and operating the owned properties (and
other apartment properties) and to make such occasional sales of the owned
properties, including peripheral land, as are consistent with our investment
objectives.
Taxation Of Taxable Domestic Shareholders
General. Provided we qualify as a REIT, distributions made to our
shareholders out of current or accumulated earnings and profits (and not
designated as capital gain dividends) will be taken into account by them
as ordinary income and will not be eligible for the dividends received
deduction for corporations. Distributions (and retained long-term capital
gains) that are designated as capital gain dividends will be taxed as
long-term capital gains (to the extent that they do not exceed our actual
net capital gain for the taxable year) without regard to the period for
which the CRT shareholder has held our stock. However, corporate CRT
shareholders may be required to treat up to 20% of certain capital gain
dividends as ordinary income. In addition certain capital gain dividends
may be taxed at different rates, depending on the type of gain recognized
by us.
Distributions in excess of current and accumulated earnings and profits
will not be taxable to a CRT shareholder to the extent that they do not exceed
the adjusted basis of the shareholder's shares in respect of which the
distributions were made, but rather will reduce the adjusted basis of such
shares. To the extent that such distributions exceed the adjusted basis of
a shareholder's shares in respect of which the distributions were made, they
will be included in income as long-term capital gain (or short-term capital
gain if the shares have been held for one year or less) provided that the
shares are a capital asset in the hands of the stockholder. In addition, any
dividend declared by us in October, November or December of any year and
payable to a shareholder of record on a specified date in any such month will
be treated as both paid by us and received by the shareholder on December 31
of such year, provided that the dividend is actually paid by us during January
of the following calendar year. CRT shareholders may not include in their
individual income tax returns any net operating losses or capital losses of
CRT.
Disposition of Stock of CRT. Except as provided below, a CRT shareholder
will generally recognize gain or loss upon the sale, exchange or other
disposition of the CRT shares in an amount equal to the difference between the
amount realized on the disposition and the basis in such CRT shares. Such gain
or loss will be long-term capital gain or loss if the CRT shares are held for
more than one year as of the date of disposition. In general, any loss upon a
sale or exchange of shares by a CRT shareholder who has held such shares for
six months or less (after applying certain holding period rules) will be
treated as a long-term capital loss to the extent of distributions from CRT
required to be treated by such CRT shareholder as long-term capital gain.
Taxation Of Foreign Shareholders
The following is a discussion of certain anticipated U.S. Federal income
and estate tax consequences of the ownership and disposition of our shares
applicable to a Non-U.S. Holder of our shares. A "Non-U.S. Holder" is any
person other than (i) a citizen or resident of the United States, (ii) a
corporation or partnership created or organized in the United States or under
the laws of the United States or of any state thereof, (iii) an estate whose
income is includable in gross income for U.S. Federal income tax purposes
regardless of its source or, (iv) a trust if a United States court is able to
exercise primary supervision over the administration of such trust and one or
more United States fiduciaries have the authority to control all substantial
decisions of such trust. The discussion is based on current law and is for
general information only. The discussion addresses only certain and not all
aspects of U.S. Federal income and estate taxation.
Ordinary Dividends. The portion of dividends received by Non-U.S. Holders
payable out of our earnings and profits which are not attributable to capital
gains of CRT and which are not effectively connected with a U.S. trade or
business of the Non-U.S. Holder will be subject to U.S. withholding tax at
the rate of 30% (unless reduced by treaty). In general, Non-U.S. Holders will
not be considered engaged in a U.S. trade or business solely as a result of
their ownership of our shares. In cases where the dividend income from a
Non-U.S. Holder's investment in our shares is (or is treated as) effectively
connected with the Non-U.S. Holder's conduct of a U.S. trade or business, the
Non-U.S. Holder generally will be subject to U.S. tax at graduated rates, in
the same manner as U.S. shareholders are taxed with respect to such dividends
(and may also be subject to the 30% branch profits tax in the case of a
Non-U.S. Holder that is a corporation).
Non-Dividend Distributions. Unless our shares constitute a United States
Real Property Interest (a "USRPI") within the meaning of the Foreign Investment
in Real Property Tax Act of 1980 ("FIRPTA"), distributions by us which are not
dividends out of our earnings and profits will not be subject to U.S. income or
withholding tax. If it cannot be determined at the time a distribution is made
whether or not such distribution will be in excess of current and accumulated
earnings and profits, the distribution will be subject to withholding at the
rate applicable to dividends. However, the Non-U.S. Holder may seek a refund
of such amounts from the IRS if it is subsequently determined that such
distribution was, in fact, in excess of our current and accumulated earnings
and profits. If our shares constitute a USRPI, such distributions will be
subject to 10% withholding and taxed pursuant to FIRPTA at a rate of 35% to
the extent such distributions exceed a shareholder's basis in his or her CRT
shares.
Capital Gain Dividends. Under FIRPTA, a distribution made by us to a
Non-U.S. Holder, to the extent attributable to gains from dispositions of
USRPIs such as the properties beneficially owned by us ("USRPI Capital Gains"),
will be considered effectively connected with a U.S. trade or business of the
Non-U.S. Holder and subject to U.S. income tax at the rates applicable to U.S.
individuals or corporations, without regard to whether such distribution is
designated as a capital gain dividend. In addition, we will be required to
withhold tax equal to 35% of the amount of dividends to the extent such
dividends constitute USRPI Capital Gains. Distributions subject to FIRPTA
may also be subject to a 30% branch profits tax in the hands of a Non-U.S.
Holder that is a corporation.
Disposition of Our Shares. Unless our shares constitute a USRPI, a sale
of such shares by a Non-U.S. Holder generally will not be subject to U.S.
taxation under FIRPTA. The shares will not constitute a USRPI if we are a
"domestically controlled REIT." A domestically controlled REIT is a REIT in
which, at all times during a specified testing period, less than 50% in value
of its shares is held directly or indirectly by Non-U.S. Holders. We believe
that we are, and it expect to continue to be, a domestically controlled REIT.
If we are, and continue to be, a domestically controlled REIT, the sale of our
shares should not be subject to taxation under FIRPTA. Because shares of
beneficial interests are publicly traded, however, no assurance can be given
that we are or will continue to be a domestically controlled REIT.
If CRT does not constitute a domestically controlled REIT, a Non-U.S.
Holder's sale of our shares generally will still not be subject to tax under
FIRPTA as a sale of a USRPI provided that (i) the stock is "regularly traded"
(as defined by applicable Treasury Regulations) on an established securities
market and the selling Non-U.S. Holder held 5% or less of such class of CRT
shares at all times during a specified testing period, or (ii) the shares are
not regularly traded on an established securities market and are convertible
into shares that are so regularly traded and the value of such convertible
stock held by the selling Non-U.S. Holder at all times during a specified
testing period is less than or equal to the value of 5% of the regularly
traded class of stock into which such stock is convertible.
If gain on the sale of CRT shares were subject to taxation under FIRPTA,
the Non-U.S. Holder generally would be subject to the same treatment as a U.S.
shareholder with respect to such gain (subject to applicable alternative
minimum tax and a special alternative minimum tax in the case of nonresident
alien individuals) and the purchaser of the stock could be required to
withhold 10% of the purchase price and remit such amount to the IRS.
Gain from the sale of CRT shares that would not otherwise be subject to
FIRPTA will nonetheless be taxable in the United States to a Non-U.S. Holder
in two cases. First, if the Non-U.S. Holder's investment in the CRT shares are
effectively connected with a U.S. trade or business conducted by such Non-U.S.
holder, the Non-U.S. Holder will be subject to the same treatment as a U.S.
shareholder with respect to such gain. Second, if the Non-U.S. Holder is a
nonresident alien individual who was present in the United States for 183 days
or more during the taxable year and has a "tax home" in the United States,
the nonresident alien individual will be subject to a 30% tax on the
individual's capital gain.
Estate Tax. CRT shares owned or treated as owned by an individual who
is not a citizen or resident (as specially defined for U.S. Federal estate
tax purposes) of the United States at the time of death will be includable
in the individual's gross estate for U.S. Federal estate tax purposes, unless
an applicable estate tax treaty provides otherwise. Such individual's estate
may be subject to U.S. Federal estate tax on the property includable in the
estate for U.S. Federal estate tax purposes.
Taxation Of Tax-Exempt Shareholders
Tax-exempt entities, including qualified employee pension and profit
sharing trusts and individual retirement accounts ("Exempt Organizations"),
are generally exempt from federal income taxation. However, they are subject
to taxation on their unrelated business taxable income ("UBTI"). While many
investments in real estate generate UBTI, the IRS has ruled that dividend
distributions from a REIT to an exempt employee pension trust do not constitute
UBTI, provided that the shares of the REIT are not otherwise used in an
unrelated trade or business of the exempt employee pension trust. Based on
that ruling, amounts distributed by us to Exempt Organizations should generally
not constitute UBTI. However, if an Exempt Organization finances its acquisition
of the CRT shares with debt, a portion of its income from CRT will constitute
UBTI pursuant to the "debt-financed property" rules. Furthermore, social clubs,
voluntary employee benefit associations, supplemental unemployment benefit
trusts, and qualified group legal services plans that are exempt from taxation
under paragraphs (7), (9), (17) and (20), respectively, of Internal Revenue
Code Section 501(c) are subject to different UBTI rules, which will generally
require them to characterize distributions from us as UBTI. In addition, in
certain circumstances, a pension trust that owns more than 10% of our shares
is required to treat a percentage of the dividends from us as UBTI (the "UBTI
Percentage"). The UBTI Percentage is the gross income derived by us from an
unrelated trade or business (determined as if CRT were a pension trust)
divided by the gross income of CRT for the year in which the dividends are
paid. The UBTI rule applies to a pension trust holding more than 10% of our
shares only if (i) the UBTI Percentage is at least 5%, (ii) CRT qualifies as
a REIT by reason of the modification of the 5/50 Rule that allows the
beneficiaries of the pension trust to be treated as holding shares of CRT
in proportion to their actuarial interest in the pension trust, and (iii)
either (A) one pension trust owns more than 25% of the value of CRT's shares
or (B) a group of pension trusts each individually holding more than 10% of
the value of CRT's shares collectively owns more than 50% of the value of CRT's
shares.
Information Reporting Requirements And Backup Withholding
CRT will report to its U.S. shareholders and to the IRS the amount of
distributions paid during each calendar year, and the amount of tax withheld,
if any. Under the backup withholding rules, a shareholder may be subject to
backup withholding at the rate of 31% with respect to distributions paid unless
such holder (i) is a corporation or comes within certain other exempt categories
and, when required, demonstrates this fact or (ii) provides a taxpayer
identification number, certifies as to no loss of exemption from backup
withholding, and otherwise complies with the applicable requirements of the
backup withholding rules. A shareholder who does not provide CRT with his
correct taxpayer identification number also may be subject to penalties
imposed by the IRS. Any amount paid as backup withholding will be creditable
against the shareholder's income tax liability. In addition, CRT may be required
to withhold a portion of capital gain distributions to any Non-U.S. Holders who
fail to certify their non-foreign status to CRT. The IRS has issued final
Treasury Regulations regarding the backup withholding rules as applied to
Non-U S. Holders. Those final Treasury Regulations alter the current system
of backup withholding compliance and will be effective for payments made
after December 31, l999. Prospective investors in CRT shares should consult
their tax advisors regarding the application of these Treasury Regulations.
Possible Legislative Or Other Actions
The rules dealing with Federal income taxation are constantly under review
by persons involved in the legislative process and by the IRS and the U.S.
Treasury Department. Changes to the Federal laws and interpretations thereof
could adversely affect an investment in CRT. For example, certain proposals
affecting REITs and partnerships. Such proposals would, among other things,
prevent the deductibility of interest incurred on certain debt funded directly
or indirectly by CRT. It cannot be predicted whether, when, in what forms, or
with what effective dates, the tax laws applicable to CRT or the partnerships,
or an investment in CRT or the CRT Subsidiary Partnerships, will be changed.
State, Local And Foreign Taxes
The CRT Subsidiary Partnerships and their partners and CRT and our
shareholders may be subject to state, local or foreign taxation in various
jurisdictions, including those in which it or they transact business, own
property or reside. The state, local or foreign tax treatment of the CRT
Subsidiary Partnerships and their partners and CRT and our shareholders may
not conform to the Federal income tax consequences discussed above.
Consequently, prospective investors should consult their own tax advisors
regarding the application and effect of state, local and foreign tax laws on
an investment in CRT.
WHERE YOU CAN FIND MORE INFORMATION
We file annual, quarterly and special reports, proxy statements and
other information with the SEC. You may read and copy any document we file
at the SEC's public reference rooms in Washington, D.C., New York, New York,
and Chicago, Illinois. Please call the SEC at 1-800-SEC-0330 for further
information on the public reference rooms. Our SEC filings are also available
to the public at the SEC's web site at http://www.sec.gov.
The SEC allows us to "incorporate by reference" the information we file
with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference
is considered to be part of this prospectus, and later information filed with
the SEC will update and supersede this information. We incorporate by reference
the documents listed below and any future filings with the SEC under Section
13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 until our
offering is completed.
- Century Realty Trust Annual Report on Form 10-K for the year ended
December 31, 1998;
- Century Realty Trust Quarterly Reports on Form 10-Q for the quarters
ended March 31 and June 30, 1999;
- the description of Century Realty Trust's shares of beneficial interest
contained in its Registration Statement on Form 10 (File No. 0-7716)
filed April 26, 1974; including any amendment or reports filed for the
purpose of updating such description.
You may request a copy of these filings, at no cost, by writing or
calling us at the following address and telephone number:
Century Realty Trust
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
(317) 632-5467
You should rely only on the information incorporated by reference or
provided in this prospectus. We have not authorized anyone to provide you
with different information. The selling shareholders named herein are not
making an offer of these securities in any state where the offer is not
permitted. You should not assume that the information in this prospectus is
accurate as of any date other than the date on the front of the document.
We have filed with the Commission a registration Statement on Form S-3
(of which this prospectus is a part) under the Securities Act of 1933, as
amended (the "Securities Act"), with respect to the shares of beneficial
interest offered hereby. This prospectus does not contain all the information
set forth in the Registration Statement, certain parts of which are omitted
in accordance with the rules and regulations of the Commission. Statements
contained in this prospectus as to the contents of any contract or any other
document are not necessarily complete, and in each instance reference is made
to the copy of such contract or other document filed as an exhibit or schedule
to the Registration Statement, each such statement being qualified in all
respects by such reference and the exhibits and schedules thereto. For further
information with respect to CRT and the shares of beneficial interest, you
should read the Registration Statement, including the exhibits filed or
incorporated by reference as a part thereof. The Registration Statement and
the exhibits thereto may be inspected without charge at the office of the
Commission, 450 Fifth Street, NW, Washington, D.C. 20549 and copies thereof may
be obtained from the Commission at prescribed rates.
LEGAL MATTERS
Certain legal and tax matters will be passed upon for CRT by Henderson,
Daily, Withrow & DeVoe, Indianapolis, Indiana.
EXPERTS
The consolidated financial statements and financial statement schedule
of Century Realty Trust incorporated by reference in Century Realty Trust's
Annual Report (Form 10-K) for the year ended December 31, 1998, have been
audited by Ernst & Young LLP, independent auditors, as set forth in their
report incorporated herein by reference. Such consolidated financial statements
are incorporated herein by reference in reliance upon such report given on the
authority of such firm as experts in accounting and auditing.
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTIONS.
The estimated expenses, other than underwriting discounts and commissions,
in connection with the offering of the shares of beneficial interests, are as
follows:
Registration Fee -- Securities and Exchange Commission $ 1,004
Printing and Engraving Expenses
Legal Fees and Expenses
Accounting Fees and Expenses
Blue Sky Fees and Expenses 3,000
Miscellaneous 1,000
Total $
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Trust Instrument of CRT limits the liability of CRT trustees to CRT and
its shareholders to (i) willful misconduct, (ii) bad faith, (iii) gross
negligence, or (iv) violations of Federal securities laws. The Trust
Instrument also provides that CRT shall indemnify any person made a party
to any action, suit or proceeding by reason of the fact that he or she is
or was a trustee, officer or employee of CRT against the reasonable expenses,
including attorneys' fees actually and reasonably incurred in connection with
the defense of such action, suit or proceeding, except where it is adjudged in
the action, suit or proceeding that the trustee, officer or employee is liable
for willful misconduct, gross negligence or for violation of the Federal
securities laws.
ITEM 16. EXHIBITS.
3.1 --Trust Instrument of Century Realty Trust (an Indiana Real Estate
Investment Trust) as last amended May 21, 1984.
3.2 --Code of By-Laws of Century Realty Trust (an Indian Real Estate
Investment Trust) as last amended July 9, 1998.
4.1 --Specimen Certificates for shares of beneficial interests
5.1 --Opinion of Henderson, Daily, Withrow & DeVoe dated August 30, 1999
regarding the validity of the Securities offered hereby.
8.1 --Opinion of Henderson, Daily, Withrow & DeVoe dated August 30, 1999
regarding tax matters.
23.1 --Consent of Henderson, Daily, Withrow & DeVoe (included in their
opinion filed as Exhibit 5.1).
23.2 --Consent of Henderson, Daily, Withrow & DeVoe (included in their
opinion filed as Exhibit 8.1).
23.3 --Consent of Ernest & Young, LLP dated August 27, 1999.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or
in the aggregate, represent a fundamental change in the
information set forth in the registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the
aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement:
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement:
provided, however, that paragraphs (a)(l)(i) and (a)(l)(ii)
shall not apply if the registration statement is on Form S-3,
Form S-8 or Form F-3, and the information required to be
included in a post-effective amendment by those paragraphs
is contained in periodic reports filed with or furnished to
the Commission by the registrant pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934 that
are incorporated by reference in the registration statement
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing
of the registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing
of an employee benefit plan's annual report pursuant to Section 15(d)
of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering
of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or
otherwise, the registrant has been advised that in the opinion of the
Securities and Exchange Commission such indemnification is against public
policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other
than the payment by the registrant of expenses incurred or paid by a
trustee, officer or controlling person of the registrant in the
successful defense of any action, suit, or proceeding) is asserted by
such trustee, officer or controlling person in connection with the
securities being registered, the registrant will, unless in the opinion
of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
POWER OF ATTORNEY
KNOWN TO ALL PERSONS BY THESE PRESENTS, that each person whose signature
appears below constitutes and appoints John I. Bradshaw, Jr. and David F.
White, jointly and severally, his attorneys-in-fact, each with the power of
substitution, for him in any and all capacities, to sign any amendments to this
registration statement (including post-effective amendments), and to file the
same, with exhibits thereto and other documents in connection therewith, with
the Securities and Exchange Commission, hereby ratifying and confirming all
that each of said attorneys-in-fact or his substitutes, may do or cause to be
done by virtue hereof.
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on this Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Indianapolis, State of Indiana, on the 30th day
of August, 1999.
CENTURY REALTY TRUST
By:
/s/ John I. Bradshaw, Jr.
__________________________
John I. Bradshaw, Jr.
President, Chief Executive
Officer and Treasurer
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement on Form S-3 has been signed below by the following
persons in the capacities and on the dates indicated.
SIGNATURE TITLE DATE
President and Chief Executive
/s/John I. Bradshaw, Jr. Officer (Principal Executive August 30, 1999
John I. Bradshaw, Jr. Officer)
Controller(Principal
/s/David F. White Financial Officer and August 30, 1999
David F. White Principal Accounting Officer)
/s/Francis M. Hapak Chairman of the Board and
Francis M. Hapak Trustee August 30, 1999
/s/John W. Adams Trustee
John W. Adams August 30, 1999
/s/John A. Wallace Trustee
John A. Wallace August 30, 1999
EXHIBIT 3.1
COPY OF THE TRUST INSTRUMENT OF CENTURY REALTY
TRUST AS FILED AND RECORDED DECEMBER 21, 1972
TRUST INSTRUMENT OF CENTURY REALTY TRUST
(An Indiana Real Estate Investment Trust)
This TRUST INSTRUMENT is made this 6th day of December, 1972, by the
undersigned trustees with the undersigned and with the persons hereinafter
called Beneficiaries.
ARTICLE I. DEFINITIONS.
Section 1.1. Name. This trust shall be known as CENTURY REALTY TRUST
(hereinafter called "the Trust" or "Trust").
Section 1.2. Organization. The Trust is hereby declared to be a business
trust under the Indiana Business Trust Act of 1963 (Ind. Code 23-5-1-1 and
following). The Trustees intend that the Trust comply with Sections 856, 857,
and 858 of the Internal Revenue Code of 1954 (P.L. 86-779 as amended: Title
26 United States Code annotated Section 856 and following):
References in this Trust Agreement to Internal Revenue Code of 1954 shall mean
the U.S. Internal Revenue Code of 1954 as amended.
Section 1.3. Trust Instrument. This trust instrument, together with
amendments thereto made from time to time, constitutes the trust instrument
of the Trust.
Section 1.4. Trustees. The Trustees shall consist of five (5) to nine
(9) persons, subject to vacancies which shall be filled as provided in this
trust instrument. The original trustees shall be the undersigned trustees.
The trustees from time to time thereafter shall be those duly elected or
appointed as provided in this trust instrument. The term "trustee" shall
apply to the trustees collectively in their fiduciary capacity and shall
not apply to them severally or as individuals.
Section 1.5. Shareholders. The term "shareholders"shall apply jointly
and severally to the persons who are holders of record on the books of the
Trust or any registrar or transfer agent acting on behalf of the Trust of
certificates of beneficial interest in the Trust. It shall include the word
"stockholders", certificate holders" or "beneficiaries", when appropriate.
Section 1.6. Shares. The term "shares" means shares of beneficial
interest in the Trust as evidenced by certificates of beneficial interest.
ARTICLE 11. INVESTMENT POLICIES.
Section 2.1. Type of Property. The trustees will attempt to comply
with the provisions of Section 856, 857 and 858 of the Internal Revenue Code
of 1954, at the earliest practicable date consistent with the best Interests
of the Trust.
Section 2.2. Policy. The policy of the Trust will be to invest
primarily in Real Estate Equities and Mortgage Loans secured by valid liens
on Real Estate and to distribute not less than ninety percent (90%) of its
net income to its stockholders or such other percentage as will take maximum
advantage of the tax savings offered by the applicable sections of the Internal
Revenue Code.
The Trust may from time to time acquire real estate for cash or through
the issuance of shares or in exchange of real estate.
Section 2.3. Change of Investment Policies. The investment policy of
the Trust may be changed by amendment of this trust instrument as provided
hereafter.
ARTICLE III. SHARES.
Section 3.1. Shares: Certificates of Beneficial Interest. The units
into which the beneficial interest in the Trust will be divided shall be
designated as shares. The certificates evidencing ownership of shares in
the Trust will be designated as Certificates of Beneficial Interest or shares.
The shares shall be personal property. The beneficiaries shall have no
legal title or interest in the property of the Trust and no right to a
partition thereof or to an action for accounting during the continuance
of the Trust.
Section .3.2. Number, Par Value, and Nonassessability. The beneficial
interest in this Trust shall initially be divided into five million (5,000,000)
shares. Such shares shall have no par value. No assessment shall ever be
made upon the shareholders.
Section 3.3. Sale of Shares. The Trustees may in their discretion,
from time to time, without vote of the shareholders, issue, sell by private
or public offering, or exchange shares in the Trust, in such number, for
such sums of money, real estate or other consideration and on such terms as
they deem proper. However, the shareholders shall have pre-emptive rights,
except as to any shares hereafter issued in connection with acquisitions by
the Trust of interests in real estate. The Trustees are authorized to enter
into a contract or contracts with an underwriter or underwriters upon such
terms and with such commissions for services as may be agreed upon by the
parties. The Trustees shall cause to be issued Certificates of Beneficial
Interest to evidence the ownership of shares in the Trust.
Section .3.4. Transfer of Shares. The persons in whose names the
shares are registered on the books of the Trust shall be deemed the absolute
owners thereof, and until a transfer is effected on the books of the Trust
the trustees shall not be affected by any notice, actual or constructive,
of any transfer.
The shares of the Trust shall be transferable only on the books of the
Trust upon surrender of the certificate or certificates representing the same,
properly endorsed by the registered holder or by his duly authorized
attorney-in-fact, such endorsement or endorsements to be witnessed by one
witness.
Section 3.5. Ownership, Stop-transfer, and Redemption. The Shareholders,
upon request, shall furnish to the trustees, in writing, such particulars as to
the direct and indirect ownership of the shares as the trustees deem necessary
for compliance with the provisions of the Internal Revenue Code of 1954 and the
Regulations thereunder regarding beneficial ownership in a real estate
investment trust, as those provisions and the Regulations may be amended from
time to time. Should the trustees, at any time, in good faith, be of the
opinion that beneficial ownership of shares of the Trust has or will become so
concentrated as to prevent the Trust from continuing to qualify as a real estate
investment trust under the applicable provisions of the Internal Revenue Code,
the trustees shall have the power to prevent the transfer of such shares by
means deemed equitable to them or to call such number of shares for redemption
as will be sufficient to maintain or bring the beneficial ownership of shares
in conformity with the applicable provisions of the Internal Revenue Code. The
price to be paid for the redeemed shares shall be (a) the sale price on the
securities exchange on which the shares are traded, as reported at the close of
the last business day prior to the date of redemption or (b) if the shares are
not traded on any securities exchange, the last bid quotation on such business
day as reported by the National Association of Security Dealers or a similar
organization selected by the trustees, or (c) if not determined as above,
the book value of the shares. From the date of redemption, the holder of
any shares called for redemption shall no longer be entitled to any dividends,
distributions, voting rights, or any other benefits of shareholders, except
the right to the redemption price.
Section 3.6. Effect of Transfer of Shares or Death, Insolvency or
Incapacity of Shareholders. Neither the transfer of shares nor the death,
insolvency or incapacity of any shareholder shall operate to dissolve or
terminate the Trust, nor shall it entitle any transferee, legal representative
or other person to a partition of the property of the Trust or to an action for
accounting.
Section 3.7. Acquisition of Shares by Trust. The Trust may repurchase
or otherwise acquire its own shares on such terms and conditions as the
trustees deem appropriate, and for this purpose the Trust may create and
maintain such reserves as are deemed necessary and proper.
Shares issued hereunder and purchased or otherwise acquired for the
account of the Trust shall not, so long as they belong to the Trust, either
receive distributions (except that they shall be entitled to receive
distributions payable in shares of the trust) or be voted at any meeting of
the Shareholders. Such shares may, in the discretion of the Trustees, be
cancelled and the number of shares authorized be thereby reduced or such
shares may, in the discretion of the Trustees, be held in the treasury and be
disposed of by the trustees at such time or times, to such party or parties,
and for such consideration, as the Trustees may deem appropriate.
Section 3.8. Acquisition of Shares by Trustee. Any trustee hereunder
may acquire, hold and dispose of shares in this trust to the same extent and
in the same manner as if he were not a trustee and without affecting in any
way his status or power as such trustee.
Section 3.9. Lost, Stolen or Destroyed Certificates. The Trust may
issue a new certificate for shares of the Trust in the place of any certificate
theretofore issued and alleged to have been lost, stolen or destroyed, but the
trustee may require the owner of such lost, stolen or destroyed certificate,
or his legal representative, to furnish affidavit as to such loss, theft, or
destruction, and to give a bond in such form and substance, and with such
surety or sureties, with fixed or open penalty, as they may direct, to
indemnify the Trust against any claim that may be made on account of the
alleged loss, theft or destruction of such certificate.
ARTICLE IV. SHAREHOLDERS.
Section 4.1. Meetings.
1. Annual Meeting of Shareholders. The first annual meeting of the
shareholders shall be held sometime between January 1, 1974 and June 30, 1974.
Thereafter, the annual meeting shall be held at such time and place as the
By-Laws provide, and upon the giving of notice as provided in Sub-Section 3
herein. At the annual meeting of shareholders, trustees shall be elected
and such business may be transacted as may lawfully come before the meeting;
provided, however, that at such annual meeting the shareholders shall vote
only on those matters upon which they are specifically entitled to vote by
this Trust. If the election of trustees shall not be held on the day designated
herein for any annual meeting, or at any adjournment thereof, the trustees
shall cause the election to be held at a meeting of the shareholders as soon
thereafter as conveniently may be. Duly elected trustees shall serve until
their successors are elected and shall have qualified. Failure to hold any
annual meeting shall not work any forfeiture or a dissolution of the Trust.
2. Special Meetings. Special Meetings may be called by the secretary
on the order or written request of the president or the trustees upon the
giving of notice as provided in Sub-Section 3 hereof, and if there has been
no annual meeting held for a period exceeding eighteen (18) months, said
special meetings shall be called upon written request of the shareholders
holding an aggregate of not less than ten percent (10%) of the outstanding
shares. Such request shall specify the purpose or purposes for which such
meeting is to be called. At such special meeting, the shareholders shall
vote only on those matters upon which they are specifically entitled to vote
by this trust.
3. Notice of Meetings. A written or printed notice, stating the place,
date and hour of any annual or special meeting of the shareholders shall, not
less than ten days nor more than forty days before such meeting, be delivered
personally to each shareholder, or shall be mailed, postage prepaid, by the
secretary to each shareholder of record, addressed to him at his address as it
appears in the records of the Trust. If mailed, such notice shall be deemed
to be delivered when deposited in the United States mail. The notice of all
special meetings shall set forth the purpose for which the meeting is called,
and no business not stated in the notice of the meeting shall be considered
at any special meeting of the shareholders.
4. Quorum. At any shareholders' meeting, thirty-three and one-third
percent (33-1/3%) of the shares of beneficial interest outstanding must be
represented by person or proxy in order to constitute a quorum for the
transaction of business; but, the shareholders present at any meeting,
although less than a quorum, may adjourn the meeting from time to time,
without further notice, to some other day or hour. Once a quorum is present
to organize a meeting, the quorum cannot be destroyed by the subsequent
withdrawal or revocation of the proxy of any shareholder. If a quorum
is present, the affirmative vote of the majority of the shares represented
at the meeting shall be the act of the shareholders unless the affirmative
vote of more than a majority is required by any provision of this trust.
Section 4.2. Matters on Which Beneficiaries Shall Be Entitled to Vote.
The beneficiaries shall be entitled to vote on the following matters, and
no others:
a. Election of Trustees: Each beneficiary shall be entitled-to one(l)
vote in person or by proxy, for each share registered in his name. The
candidates receiving the highest number of votes up to the number of
trusteeships to be filled in the election shall be elected.
b. Removal of Trustees: Any trustee may be removed as provided in
Section 5.16 herein.
c. Termination of Trust: The Trust may be terminated as provided
in Section 8.2 herein.
Section 4.2d. General. Notwithstanding any other provisions of the
Trust Instrument to the contrary, any action taken by the Trustees to merge
or consolidate or otherwise amalgamate the Trust with any other Trust or
corporation, or to amend the Trust Instrument shall not become effective
until such action is first approved by the vote or written consent of the
holders of either:
(1) A majority of the issued and outstanding shares; or
(2) Two-thirds of the shares voting on the matter, providing a quorum
is present in person or by proxy.
Section 4.3. Voting Lists. The Transfer Agent of the Trust shall, at
least five days before each election of trustees, make a complete list of the
certificate holders entitled to vote at such election, arranged in alphabetical
order, with the address and number of shares so entitled to vote held by each,
which list shall be on file at the principal office of the Trust and subject
to inspection by any shareholder. Such list shall be produced and kept open
at the time and place of election and subject to the inspection of any
shareholder during the holding of such election. The original stock register
or transfer book, or a duplicate thereof kept in the State of Indiana, shall
be the only evidence as to who are the shareholders entitled to examine such
list, or the stock ledger or transfer book, or to vote at any meeting of the
shareholders.
Section 4.4. Fixing of Record Date to Determine Certificate Holders
Entitled to Vote. The Trustees may fix a day and hour not more than forty (40)
days prior to the holding of any meeting of certificate holders as the time
as of which certificate holders entitled to notice of, and to vote at, such
meeting shall be determined, and all persons who are holders of record of
voting shares at such time, and no others, shall be entitled to notice of,
and to vote at, such meeting.
Section 4.5. Non-Liability of Beneficiaries. Shareholders shall not
be liable for any assessment on account of the shares owned by them, and
the trustees shall have no power to bind the shareholders personally. All
persons dealing with or having any claim against the trustees or any officer
or agent of this trust shall look only to the funds and property of this trust
for the payment of any debt, claim, damage, judgment or decree, or of any
money or other thing that may become due or payable in any way, whether
founded upon contract or tort, and the shareholders shall not be personally
or individually liable therefor. Any shareholder held so personally liable
shall be entitled to exoneration from the Trust's assets.
In every written order, contract, instrument or obligation given or
executed by the trustees or under their authority, it shall be the duty of
the trustees to insert or cause to be inserted a stipulation to the effect
that the shareholders shall not be liable for any debt, demand or liability
incurred by or under the authority of the trustees, and reference shall be
made to this Trust Instrument. However, no dereliction of the trustees or
of the officers or agents of this Trust in this regard shall have the effect
of rendering any shareholder personally liable.
Section 4.6. Distributions. It is the declared policy of the Trust that
the trustees shall (and may more frequently) declare and pay, within sixty (60)
days after the end of each annual period after the calendar year in which the
Trust is created, to the Shareholders as near to all of the net income of the
Trust (net income for the purpose of this Section shall mean net income for
tax purposes adding back deductions for depreciation and similar non-cash
charges) as shall be available therefor unless the trustees deem it imprudent
to make such distributions, but in any event the trustees shall, from time to
time, declare and pay to the shareholders such distributions as may be necessary
to continue to qualify the Trust as such "real estate investment trust", (so
long as such qualification, in the opinion of the trustees, is in the best
interest of the shareholders) as well as such additional distributions as the
trustees may, in their discretion, declare. Each distribution when made shall
be accompanied by a written statement indicating, to the fullest extent
practicable, the sources of the distribution.
Section 4.7. Fixing of Record Date to Determine Certificate Holders
Entitled to Receive Trust Benefits. The Trustee may fix a day and hour not
exceeding thirty (30) days preceding the date fixed for payment of any
dividend, or for the delivery of evidences of rights, or for the distribution
of certificates for shares, without par value, upon a change of outstanding
shares, without par value, into a greater or lesser number of shares, as a
record time for the determination of the certificate holders entitled to
receive any such dividend, rights or distribution, and in such case only
certificate holders of record at the time so fixed shall be entitled to
receive such dividend, rights or distribution. The trustees at their option
may also prescribe a period not exceeding thirty(30) days prior to the
payment of such dividend, delivery or distribution, during which no transfer
of shares on the books of the Trust may be made.
Section 4.8. Reports to Shareholders. The Trust shall transmit to
the shareholders annually within three (3) calendar months following the
close of its fiscal year a report which shall contain:
(1) a statement by the Trustees as to the course of the operations
of the Trust during the fiscal year covered by such report, including a
schedule of the funds distributed to the shareholders during such fiscal
year and the respective sources thereof;
(2) a description of the major real estate assets and mortgages owned
by the Trust at the close of such fiscal year, and other disclosures of
material interest to the shareholders; and
(3) financial statements consisting of a balance sheet, a profit and
loss statement, and an analysis of surplus, all prepared in accordance with
generally accepted accounting principles, and generally conforming to the
requirements for financial statements to be included in annual reports filed
with the Securities and Exchange Commission by companies subject to its
jurisdiction. Such statements shall be audited and certified by an independent
certified public accountant.
As promptly as possible after the close of each semiannual period in
each fiscal year, the Trustees shall(and may more frequently) transmit an
income and expense statement to the shareholders for such six-month period,
which statement need not be audited or certified by an independent certified
public accountant.
Section 4.9. Books and Records. The books and records of the Trust
shall be open to inspection upon the written demand of a shareholder at any
reasonable time for a good faith purpose reasonably related to the interests
of such shareholder as a shareholder.
Such inspection by a shareholder may be made in person or by agent or
attorney and the right of inspection includes the right to make extracts.
Demand of inspection other than at a shareholders' meeting shall be made
in writing upon the Chairman of the Trustees, or the Secretary.
The duly authorized officials of any state shall have the same right of
inspection as a shareholder.
ARTICLE V - TRUSTEES
Section 5.1. Number. The number of trustees shall be fixed from time
to time by a resolution passed by a majority of the trustees, but shall not be
less than five (5) nor more than nine (9).
Section 5.2. Classes. Each trustee named herein, prior to the first
annual meeting of shareholders, shall (except in the event of resignations or
vacancies or removals pursuant to Sections 5.5, 5.6 and 5.16) hold office until
his successor has been elected at such meeting. At such meeting the trustees
shall be divided into three (3) classes, and one class of trustees shall be
elected to hold office for a term of one year, one class of trustees shall be
elected to hold office for a term of two years, and one class of trustees
shall be elected to hold office for a term of three years, and, in each case,
until their respective successors are duly elected and qualified. At each
annual meeting of shareholders thereafter, one class of Trustees shall be
elected to hold office for a term of three years and until their respective
successors are duly elected and qualified.
Section 5.3. Election and Qualification. After the election of trustees
at the first annual meeting, the trustees shall determine and notify
shareholders which Trusteeships are to be elected at each of the annual
meetings of the shareholders. Nominations for trustees may be made from
the floor by any shareholder at the annual meeting. Incumbent trustees
may be reelected.
The trustees must be United States citizens, but need not be residents
of the State of Indiana. Trustees may, but need not, own shares of this Trust.
The trustees shall not be minors. The election of any Trustee (other than an
individual who was serving as a trustee immediately prior to such election)
shall not become effective unless and until such person shall have in writing
accepted his election and agreed to be bound by the terms of this Trust
Instrument. No person shall be eligible to serve as a trustee of this Trust
if such person is an officer or employee of, or has any direct or indirect
proprietary interest in, any independent contractor which furnishes supplies,
or renders services pertaining to the trust property, or which manages or
operates such property, except as provided in Section 5.19(3) herein.
Section 5.4. Compensation of Trustees. The trustees shall initially
receive such compensation as trustee as the Court shall determine reasonable
and proper. Thereafter, the trustees shall receive such compensation as
trustee as they shall, from time to time, prescribe by resolution as reasonable
and proper.
Section 5.5. Resignation. A trustee may resign at any time by giving
written notice to the Secretary of the Trust, at the principal office of the
Trust. Such resignation shall take effect at the date it is received by the
Secretary of the Trust or at any later time specified in the written
resignation. Acceptance of the resignation shall not be required to make it
effective.
Section 5.6. Vacancies. The vacancy of any or all of the Trusteeships
for any reason whatsoever shall not affect the validity of the Trust or cause
its termination. The surviving or remaining trustee or trustees may exercise
the powers of the Trust given by this Trust Instrument. Any vacancy among
the trustees occurring during a term of office of a duly elected trustee may
be filled until the next annual meeting of the shareholders by a person
selected by a majority vote of the remaining trustees, provided, however, that
if there are less than three (3) trustees qualified and acting hereunder at
any time, or, if the number of trustees duly elected by the shareholders is
less than a majority of the total number of trustees, a special meeting of
the shareholders shall be called by any shareholder within thirty (30) days
after the date such vacancy occurred, at which, meeting trustees shall be
elected by the shareholders to serve the remainder of unexpired terms of
all trusteeships in which vacancies have occurred since the last annual
meeting.
Section 5.7. Successor Trustees. Successor trustees shall have the
same powers as the original trustees under this Trust Instrument. Title to
all forms of property held by the trustees or any of them on behalf of the
Trust or in the name of a nominee on behalf of the Trust shall be vested in
the successor trustees upon their election without further action.
Section 5.8. Regular Meetings of Trustees. Regular meetings of the
trustees shall be held quarterly. One of such regular meetings shall be held
immediately after the annual meeting of the shareholders and at the same place
where such annual meeting is held. At such meeting of the trustees, the
trustees shall elect the officers of this trust, as well as the executive
committees, if any, or other trust committees, if any, for the ensuing year.
The other meetings of the Trustees shall be held upon the call of the President,
the Secretary, or any two trustees at such time and place as the By-Laws or a
Resolution of the trustees shall provide or permit. Notice of any meeting shall
be mailed or otherwise given (including, without limitation, by telephone or
telegraph) not less than three (3) days prior to the meeting but may be waived
in writing by any trustee either before or after such meeting. The attendance
of a trustee at a meeting shall constitute a waiver of notice of such meeting,
except where a trustee attends a meeting for the express purpose of objecting
to the transaction of any business on the ground that the meeting has not
been lawfully called or convened.
Section 5.9. Special Meetings of the Trustees. The president of the
trust, or any two trustees, may call a special meeting of the trustees
whenever, in their opinion, the interests of the trust require it, by
notice in writing served in person or through the mail at least one day
previous to such meeting. Such notice shall state the day, time, place and
purpose of the meeting. However, other matters may come before the meeting
unless specific notice of such matter is required in this Trust Instrument or
in the By-Laws or rules adopted by the Trustees. A waiver of such notice
signed by any trustee or trustees shall be equivalent to the giving of such
notice to the signer or signers. When all the trustees shall be present at
any special meeting, however called or notified, or shall sign a written
consent thereto, the acts of such meeting shall be valid as if legally called
and notified.
Section 5.10. Quorum. A majority of the trustees then in office shall
constitute a quorum for the transaction of business at any meeting of the
trustees, but a smaller number may adjourn the meeting from time to time to
another day or hour without further notice.
Section 5.11. Manner of Acting. A majority of the trustees then in
office attending any meeting duly held, may exercise any of the powers,
discretions and trusts vested in the trustees of this trust and their
decisions and actions shall constitute the decisions and actions of all of
the trustees and shall have the same effect as if assented to by all; provided,
however, that if at any time there are less than four (4) trustees acting
hereunder, such powers, discretions and trusts may be exercised by such
trustees, but only upon their unanimous consent. The aforesaid requirement
of unanimous consent among the trustees shall continue in effect until the
shareholders have elected trustees to fill the vacancies.
Section 5.12. Presumption of Assent. A trustee of this trust by his
presence at a meeting of the trustees at which action on any matter is
taken shall be conclusively presumed to have assented to the action taken
unless his dissent shall be entered in the minutes of the meeting or unless
he shall file his written dissent to such action with the person acting as
secretary of the meeting before the adjournment thereof or shall forward
such dissent by registered mail to the secretary of this trust immediately
after adjournment of the meeting. Such right to dissent shall not apply to
a trustee who voted in favor of such action.
Section 5.13. Action by Trustees without Meeting. It is not the intent
that the trustees must hold meetings for all actions to be taken hereunder
since the places of residence of the trustees and their other business
obligations may preclude the holding of meetings with respect to the exercise
of all of the powers hereunder. Therefore:
(a) The execution of any contract, transfer, conveyance, mortgage,
pledge, lease or other instrument on behalf of this trust by all of the
trustees without holding a meeting shall have the same effect as action
authorized at a meeting of the trustees; and
(b) At least four-fifths (4/5) of the existing trustees, but not
less than three (3) trustees, may take any action or execute any written
instrument in the name of all of the trustees on behalf of this trust
without holding a meeting, provided that at least seven (7) days' prior
written notice has been given to all of the trustees of the subject
matter of the proposed action or of the written instrument to be executed;
and provided, further, that no trustee shall have notified the secretary
of this trust in writing of his objection to the proposed action, or to
the proposed execution of the written instrument in question, prior to
the expiration of said seven-day period. If any objection shall be
received by the secretary, then he shall promptly call a meeting of
the trustees to consider the proposed action. Any trustee may waive
any notice required under this subsection.
Section 5.14. Action by Four-Fifths of Trustees Binding As to Third
Parties. Notwithstanding the foregoing provisions or any other provisions of
this Trust, any contract, transfer, conveyance, mortgage, pledge, lease or
other Instrument executed in the name of all of the trustees by four-fifths
(4/5) of the existing trustees, but not less than three (3) trustees, shall,
as to third persons dealing with the trustees, have the same effect as action
authorized at a meeting of the trustees, and no person dealing with the
trustees shall be required to ascertain whether the foregoing provisions
with respect to notice to all of the trustees have been met.
Section 5.15. Power to Appoint an Attorney-in-Fact,
Any trustee at any time acting hereunder may appoint any co-trustee to be the
attorney-in-fact-for the appointing trustee by an instrument in writing
executed under seal and acknowledged as deeds of real estate are required
to be acknowledged in Indiana, giving such attorney-in-fact full power, for
such period of time and to such extent as may be provided in such written
instrument to perform the duties and to execute the powers by this trust
conferred upon the appointing trustee.
Section 5.16. Removal of Trustees. Any trustee may only be removed
with cause at any annual or special meeting of the certificate holders by
vote of a simple majority of the shares of the Trust then outstanding and
entitled to vote.
Any trustee may be removed for cause at any annual or special meeting
of the trustees by vote of two-thirds of the trustees attending such meeting.
Section 5.17. Title and Authority-of the Trustees. The Trustees shall
hold legal title.to all property owned in the name of the Trust or in the name
of one or more of the Trustees, as Trustees for the Trust. The Trustees shall
have absolute control, management and disposition of the property of the Trust,
and absolute and exclusive control over the management and conduct of the
business and affairs of the Trust, subject only to the express limitations
of this trust
instrument.
Section 5.18. Powers of Trustees. The trustees shall have all of the
powers necessary, convenient or appropriate to effectuate the purposes of the
Trust, and may take any action authorized by vote of a majority of trustees
which they deem necessary or desirable and proper to carry out such purposes
not inconsistent with this Trust instrument. Any determination of the purposes
of the Trust and any construction of the provisions of this Trust instrument
made by the trustees in good faith shall be conclusive for all purposes. In
construing the provisions of this Trust instrument, the presumption shall be
in favor of the grant of powers to the trustees.
Without limiting the generality of the powers of the trustees, conferred
above or elsewhere in this Trust instrument, the powers of the trustees shall
include the following:
(1) To purchase, acquire through the issuance of shares in the Trust,
obligations of the Trust or otherwise, and to mortgage, sell, acquire
on lease, hold, manage, improve, lease to others, option, exchange,
release and partition real estate of every nature, including freehold,
leasehold, mortgage, ground rent and other interests therein, and to
erect, construct, alter, repair, demolish or otherwise change
buildings and structures of every nature.
(2) To enter into a contract or contracts, on an exclusive or
non-exclusive basis, for the management and operation by another
or others of any or all real estate in which the Trust shall have
an interest. Such contract or contracts may be for any term not
exceeding ten years and may be renewable. Any such contract shall
provide that in the event its terms shall impair the status of the
Trust as a "real estate investment trust" within the meaning of the
Real Estate Investment Trust Provisions, such contract will terminate
unless the parties negotiate such amendments thereto as may be
necessary to restore such status, and that if for any reason other
than the terms of such contract the other party shall at any time
during the term thereof not be an "independent contractor" within
the meaning of the Real Estate Investment Trust Provisions, such
contract shall forthwith terminate.
(3) To purchase, acquire through the issuance of shares in the Trust,
obligations of the Trust or otherwise, option, sell and exchange
stocks, bonds, notes, certificates of indebtedness and securities
of every nature.
(4) To purchase, acquire through the issuance of shares in the Trust,
obligations of the Trust or otherwise, mortgage, sell, acquire or
lease, hold, manage, improve, lease to others, option and exchange
personal property of every nature.
(5) To hold legal title to property of the Trust in the name of the Trust,
or in the name of one or more of the Trustees, without disclosure of
the interest of the Trust therein.
(6) To borrow money for the purposes of the Trust and to give notes,
debentures, bonds, and other negotiable or non-negotiable instruments
of the Trust therefor; to enter into other obligations on behalf of
and for the purposes of the Trust; and to mortgage or pledge or cause
to be mortgaged or pledged real and personal property of the Trust to
secure such notes, debentures, bonds, instruments or other
obligations.
(7) To lend money on behalf of the Trust and to, invest the funds of the
Trust.
(8) To create reserve funds for such purposes as they deem advisable.
(9) To deposit funds of the Trust in banks and other depositories without
regard to whether such accounts will draw interest.
(10) To pay taxes and assessments imposed upon or chargeable against the
Trust or the Trustees by virtue of or arising out of the existence,
property, business or activities of the Trust.
(11) To issue, sell or exchange shares of the Trust as provided in Section
3.3 hereof. The good faith determination of the value of the
consideration received by the Trust shall be within the absolute
discretion of the Trustees.
(12) To adopt and from time to time amend or repeal the By-Laws of the
Trust.
(13) To exercise with respect to property of the Trust, all options,
privileges and rights, whether to vote, assent, subscribe or convert,
or of any other nature; to grant proxies, and to participate in and
accept securities issued under any voting trust agreement.
(14) To participate in any reorganization, readjustment, consolidation,
merger, dissolution, sale, or purchase of assets, lease, or similar
proceedings of any corporation, partnership or other organization in
which the Trust shall have an interest and in connection therewith
to delegate discretionary powers to any reorganization, protective
or similar committee and to pay assessments and other expenses in
connection therewith.
(15) To engage or employ agents, representatives and employees of any
nature, or independent contractors, and to delegate to one or more
Trustees, agents, representatives, employees, independent contractors
or other persons such powers and duties as the trustees deem
appropriate. The same persons may be employed in multiple capacities
and may receive compensation from the Trust in as many capacities
as they may be engaged or employed by the Trust.
(16) To determine conclusively the allocation between capital and income
of the receipts, holdings, expenses and disbursements of the Trust,
regardless of the allocation which might be considered appropriate
in the absence of the provision.
(17) To determine conclusively the value from time to time and to revalue
the real estate, securities and other property of the Trust, in
accordance with such appraisals or other information as they deem
satisfactory.
(18) To compromise or settle claims, questions, disputes and controversies
by, against or affecting the Trust.
(19) To solicit proxies of the Shareholders.
(20) To adopt a fiscal year for the Trust and to amend or change such
fiscal year.
(21) To deal with the Trust property in every way that it would be lawful
for an individual to deal with the same, whether similar to or
different from the ways above specified.
(22) The Trustees shall have power, for such purposes, as the Trustee
may deem necessary or desirable for the transaction of the business
of the Trust, to appoint, employ or contract with any person
(including one or more of themselves and any corporation,
partnership or trust of which one or more of them may be an
affiliate, subject to the applicable requirements of Sections
5.19(3) and 11.7) including any person who, under the supervision
of the Trustees, may furnish the Trustees with advice and
recommendations with respect to the acquisition, holding and
disposition of investments and with respect to other aspects of
the business and affairs of the Trust, as the Trustees deem
necessary.
Section 5.19. Prohibited Activities. The Trust shall not do or perform
any of the following:
(1) Engage in the business of operating a rural loan and savings
association or credit union; have the power or authority to conduct
a banking, railroad, insurance, safety, safe deposit, mortgage
guaranty, or building and loan business; engage in the business
of mining or manufacturing; or engage in any business regulated
under the Public Service Commission of Indiana.
(2) Issue any class of non-voting stock.
(3) Acquire, lend or convey any interest in any property (other than
securities of the Trust) in which any trustee, officer, employee,
investment adviser, manager, or independent contractor of the Trust
also has an interest, directly or indirectly, unless such transaction
(i) has been approved, after disclosure of such relationship, by a
majority of the Trustees not so affiliated; (ii) is on terms fair
and reasonable to the Shareholders and (iii) is on terms at least
as favorable to the Trust as the terms for comparable transactions
(of which the Trustees have knowledge) with an entity not an
Affiliate of the Trust. For the purposes of this Sec. 5.19(3),
the term "independent contractor" shall mean an "independent
contractor" as defined in Section 856(d)(3) of the Internal Revenue
Code of 1954, which furnishes services to tenants of, or manages
or operates, real property owned by the Trust.
(4) Engage in any new business activity inconsistent with the requirements
needed to qualify as a Real Estate Investment Trust under the
Internal Revenue laws of the United States.
Section 5.20. Liability of Trustees. No trustee shall be liable for any
act or omission whatsoever of any other trustee or of any officer or agent of
this Trust; nor shall any trustee be liable for any negligence, error in
judgment, or for any act or omission, except for his own wilful misconduct,
bad faith or gross negligence in conduct of his duties, and further except for
any violation or violations of the Federal Securities laws. While it is the
intention of the trustees to operate this trust in such manner as to qualify
as a Real Estate Investment Trust under Sections 856 to 858 of the Internal
Revenue Code of 1954, as amended, or under any similar legislation which may
be hereafter enacted, the trustees shall not be liable to the shareholders if
at any time it should be determined by the Internal Revenue Service that the
Trust does not so qualify. The trustees shall be required to give bond or
surety to secure the performance of their duties under this trust. In general,
the liabilities of the Trustees shall be the same as Directors of corporations.
Every act or thing done or omitted, and every power exercised or obligation
incurred by the trustees, or any of them, in the administration of this trust
or in connection with any business, property or concerns of this Trust, whether
ostensibly in their own names or in their trust capacity, shall be done,
omitted, exercised or incurred by them as trustees and not as individuals; and
every person contracting or dealing with the trustees or having any debt, claim
or judgment against them or any of them shall look only to the funds and
property of this trust for payment or satisfaction; and no trustee or trustees
and no officer or agent of this trust shall ever be personally liable for or
on account of any contract, debt, tort, claim, damage, judgment or decree
arising out of, or out of the preservation of, the property of this trust or
the conduct of any business of this trust. A stipulation or notice to this
effect shall be inserted in any contract, order or similar instrument made
by the trustees or their officers or agents; but the omission thereof shall
not be construed as a waiver of the foregoing provision, and shall not render
the trustees, officers or agents personally liable.
Section 5.21. Indemnification of Trustees, Officers and Others. The
Trust shall indemnify any person made a party to any action, suit or proceeding
by reason of the fact that he is or was a trustee, officer or employee of the
Trust against the reasonable expenses, including attorneys' fees actually and
reasonably incurred by him in connection with the defense of such action,
suit or proceeding, or in connection with any appeal therein, except in
relation to matters as to which it shall be adjudged in such action, suit or
proceeding that such trustee, officer or employee is liable for gross negligence
or wilful misconduct in the performance of his duties, and further except for
any violation or violations of the Federal Securities laws. The Trust may
also reimburse to any such trustee, officer or employee the reasonable costs
of settlement of any such action, suit or proceeding, if it shall be found by
a majority of a committee composed of the trustees not involved in the matter
of controversy (whether or not a quorum) that it was to the interests of the
Trust that such settlement be made and that such trustee, officer or employee
was not guilty of gross negligence or wilful misconduct in the performance of
his duties or of any violation or violations of the Federal Securities laws.
Such rights of indemnification and reimbursement shall not be deemed exclusive
of any other rights to which such trustee, officer or employee may be entitled
apart from the provisions of this Section.
Section 5.22. Persons Dealing with Trustees. Any acts of the trustees
purporting to be done in their capacity as such, or by agents or representatives
of the Trust under authority from the trustees, shall as to other persons
dealing with such trustees, agent or representative, be conclusively deemed to
be within the purposes of the Trust and within the powers of the trustees. No
person dealing with the trustees and agents or representatives, or any of them,
shall be bound to see to the application of any funds or property passing into
their hands or control.
The receipt of the duly authorized agents or representatives of the Trust
for moneys or other consideration paid or delivered to any of them shall be
effectual discharges to persons paying or delivering the same.
ARTICLE VI - COMMITTEES
Section 6.1. Committees Appointed by Trustees. The trustees may appoint
such committees, in addition to an executive committee, as they may from time
to time determine by resolution or pursuant to By-Laws, rules or regulations
adopted by the trustees.
Section 6.2. Executive Committee. At each annual meeting of trustees,
the trustees may appoint not less than three (3) of their number to the
executive committee of the Trust to serve for such term as the trustees
may decide. The term of office of each executive committee member shall
continue until his successor has been elected and qualified.
The executive committee shall have and exercise all of the powers of
the trustees stated in Section 5.18 of this Trust instrument in the
month-to-month management of the Trust; however, the delegation of such
authority to the executive committee shall not operate to relieve any
trustee of any responsibility imposed upon him by law or by this trust
instrument.
During the intervals between meetings of the trustees, and subject to such
limitations as may be required by law or by resolution of the trustees, the
executive committee shall have and may exercise all of the powers of the
trustees in the month-to-month management of the business and affairs of the
Trust. All minutes of meetings of the executive committee shall be submitted
at the next succeeding meeting of the trustees for approval, but failure to
submit such minutes or to receive the approval thereof shall not invalidate
any completed action taken by the Trust upon authorization by the executive
committee before the time at which such minutes should have been or were
submitted. The executive committee shall not have the authority of the trustee
in reference to amending this trust instrument; purchasing, acquiring,
mortgaging, selling, or otherwise disposing of real estate; borrowing or lending
money on behalf of the Trust; issuing, selling, exchanging or acquiring shares
of the trust; declaring dividends; adopting an agreement or plan of merger,
consolidation, reorganization or dissolution; or amending the By-Laws,
rules or regulations adopted by the trustees.
ARTICLE VII - OFFICERS
Section 7.1. Number and Election. The officers of the Trust shall
consist of the president, the secretary, the treasurer, and such other officers
as the By-Laws may from time to time provide. The president shall be a trustee.
Any two or more offices may be held by the same person except that the duties
of president and secretary shall not be performed by the same
person.
Section 7.2. Election and Term of Office. The initial president,
secretary and treasurer shall be designated by Order of Court, and thereafter,
the officers shall be elected by a majority vote of the trustees at the
meeting of the trustees to be held immediately after the annual meeting
of the shareholders. Each officer shall hold office during the ensuing
year and until his successor shall have been duly elected and qualified,
or until he shall resign or shall have been removed in the manner hereinafter
provided.
Section 7.3. Compensation of Officers. The Trustees shall fix the
compensation of all officers whom they elect, may receive reasonable
compensation for their general services as Trustees and officers hereunder,
and may pay themselves or any one or more of themselves such compensation for
special services as they in good faith may deem reasonable.
Section 7.4. Removal. Any officer elected by the trustees may be removed
by a majority vote of the trustees, at a special meeting called for such purpose
whenever, in their judgment, the best interest of this Trust would be served
thereby, but such removal shall be without prejudice to the contract rights,
if any, of the person so removed.
Section 7.5. Resignation. Any officer may resign at any time by giving
written notice to the president or secretary at the principal office of the
Trust. Such resignation shall take effect at the date it is received at the
principal office of the Trust or at any later time specified in the written
notice. The acceptance of the resignation shall not be necessary to make it
effective unless the officer has a written employment contract with the Trust.
ARTICLE VIII - DURATION AND TERMINATION OF THE TRUST
Section 8.1. Duration of the Trust. The Trust shall continue
perpetually unless terminated as provided in this trust instrument, except
that in the event that a statute or rule of law shall require that a trust
may not continue perpetually. Then, the Trust shall continue for the longest
period of time permitted by law unless sooner terminated as provided in this
trust instrument, and to the extent that measuring lives in being are required
to determine the term of this Trust, such measuring lives in being shall be
the undersigned trustees who have executed this trust instrument and their
issue living at the time of the execution of this trust instrument, and that
Trust shall in such event continue until the death of the last survivor of
them plus an additional period of twenty-one (21) years, unless sooner
terminated as provided in this trust instrument.
Section 8.2. Termination of the Trust. The Trust may be terminated at
any time by a two-thirds (2/3) vote or written consent of the outstanding
shares of beneficial interest.
The Trust may also be terminated by a majority vote or written consent
of the outstanding shares of beneficial interest when the termination has
been recommended by a two-thirds (2/3)vote of the trustees.
In connection with any termination of the Trust, the trustees, upon
receipt of such releases or indemnity as they deem necessary for their
protection, may either (1) sell and convert into cash the property of the
Trust and distribute the net proceeds among the shareholders proportionately,
or (2) convey the property of the Trust to one or more persons, entities,
trusts or corporations, for consideration consisting in whole or in part of
cash, shares of stock, or other property of any kind, and distribute the
net proceeds among the shareholders proportionately at valuations fixed by
the trustees after independent appraisals, in cash or in kind, or partially
in cash and partially in kind.
Upon termination of the Trust and distribution to the shareholders as
provided in this trust instrument, a majority of the trustees shall execute
and lodge among the records of the Trust, an instrument in writing setting forth
the facts of termination and a full report thereof, a copy of which shall be
sent by mail to each shareholder, and the trustees shall thereupon be discharged
from any and all further liabilities and duties under this trust instrument,
and the right, title and interest of all shareholders shall cease and be
cancelled and discharged.
ARTICLE IX. - AMENDMENTS
Section 9.1. Amendments by Certificate Holders. This trust instrument
may be amended by vote or written consent as provided in Article IV, Section
4.2d herein.
Section 9.2. Filing and Recording Amendments. No amendment of this Trust
instrument shall be effective until an executed copy thereof has been filed in
the Office of the Secretary of State of Indiana and a file-marked copy thereof
recorded in the office of the County Recorder of the county in which the
principal office of this Trust in the State of Indiana is located.
ARTICLE X. - SEPARABILITY CLAUSE.
Section 10.1. Interpretation-Trust Tax Provision or Certificate Holders'
Liability. If any branch, department, agency or instrumentality of the United
States of America, the State of Indiana, or any branch, department, agency or
instrumentality of any jurisdiction where the securities of the Trust are
registered or to be registered shall so interpret or construe any provision
of this trust instrument which shall have the effect of (1) denying to the
Trust the applicability of Sections 858, 857 and 858 of the Internal Revenue
Code of 1954, as amended, or any similar federal revenue statute, or (2)
denying to the shareholders freedom from assessment and liability for any
and all of the obligations of the Trust, then provision of this trust
instrument shall be deemed to have no force and effect and the trust instrument
shall be deemed to have been written without such particular provision.
Section 10.2. Interpretation - Invalidity. If any provision of this
trust instrument, or the application thereof to any person or circumstances,
is held ineffective or invalid because contrary to any law, rule or regulation
of the United States of America, the State of Indiana, or any agency or
instrumentality thereof, or of any jurisdiction or any agency or instrumentality
thereof, where the securities of the Trust are registered or to be registered,
the remainder of the provisions of this trust instrument and the application
of such provision to other persons or circumstances shall not be affected
thereby.
Section 10.3. Separability. The finding of invalidity of a Section, or
part of this Trust instrument, shall not affect the validity of any other
Section or part.
ARTICLE XI. MISCELLANEOUS.
Section 11.1. Applicable Law. The laws of the State of Indiana shall
govern the construction, validity, and effect of this trust instrument and the
administration of the Trust hereby created.
Section 11.2. Applicability of Indiana General Corporation Laws. The
Trust and the certificates of beneficial interest in the Trust shall be subject
to all applicable provisions of Indiana law, now in effect or hereafter enacted,
relating to Indiana corporations with regard to the issuance and transfer of
securities, filing of required statements, reports, service of process, and
liability for or exclusion from taxation under the provisions of Indiana Code
6-5-1-1 through 6-5-1-33 (1971).
Section 11.3. Headings for Reference Only. Headings preceding the text,
articles and sections hereof have been inserted solely for convenience and
reference and shall not be construed to affect the meaning, construction or
effect of this declaration of trust.
Section 11.4. Counterparts. This declaration may be simultaneously
executed in several counterparts, each of which when so executed shall be
deemed to be an original, and such counterparts together shall constitute
but one and the same instrument, which shall be sufficiently evidenced by
any such original counterpart.
Section 11.5. Insurance. The Trust will use its best efforts to obtain
or cause to be obtained all customary types of insurance against liabilities
or hazards.
Section 11.6. Right to Engage In Business Activities Similar to Those of
the Trust. Any trustee, officer, employee or agent of the Trust may, in his
personal capacity, engage in business activities in addition to those relating
to the Trust, which interests and activities may be similar to those of the
Trust, and any trustee, officer, employee, or agent of the Trust shall be free
of any obligation to present to the Trust any investment opportunity which
comes to him in any capacity other than solely as trustee, officer, employee
or agent of the Trust.
Section 11.7. Conflict of Interest. No trustee, officer, employee or
agent, or independent contractor of the Trust shall receive any compensation,
either directly or indirectly, in connection with any transaction entered into
with the Trust from any person dealing with the Trust, except such compensation
as is paid by the Trust directly to any trustee, officer, employee, agent or
independent contractor.
IN WITNESS WHEREOF, the undersigned trustees have set their hands and
seals.
/s/ C.O. ALIG, JR. One Indiana Square, Indianapolis, IN
/s/ ROBERT E. GREEN P. O. Box 157, Oaktown, IN
/s/ ROBERT J. GREESON 5620 Glencoe Street, Indianapolis, IN
/s/ KING R. TRAUB 320 North Meridian Street, Indianapolis, IN
/s/ MILTON MARLINBERG 1100 Euclid Avenue, Marion, IN
/s/ JOHN A. WALLACE One Indiana Square, #2500, Indianapolis, IN
/s/ WILLIAM L. ELDER 320 North Meridian, #620, Indianapolis, IN
STATE OF INDIANA )
)SS:
COUNTY OF MARION )
Before me, a Notary Public, personally appeared the trustees and
acknowledged to me their execution of the foregoing Trust Instrument to
be their free, voluntary act.
IN WITNESS WHEREOF, I have hereunto set my hand and seal this 6th day
of December , 1972.
/s/ CHRISTINA URICH
Notary Public
My Commission Expires: 12/23/73
EXHIBIT 3.2
COPY OF CODE OF BY-LAWS OF CENTURY REALTY TRUST
CODE OF BY-LAWS OF CENTURY REALTY TRUST
(An Indiana Real Estate Investment Trust)
BY-LAWS
These articles are the By-Laws of CENTURY REALTY TRUST, a business
trust organized under the laws of the State of Indiana by a Trust Instrument
made on the 6th day of December, 1972, and recorded in the Recorder s office
of Marion County and with the Secretary of State of Indiana. These By-Laws
have been adopted by the Trustees pursuant to Section 5.18 (12) of the Trust
Instrument.
All words and terms capitalized in these By-Laws, unless otherwise
defined herein, shall have the same meaning as they have in the Trust
Instrument.
ARTICLE 1. DEFINITIONS
Section 1.01. Name. This trust shall be known as CENTURY REALTY TRUST
(hereinafter called the Trust or Trust ).
Section 1.02. Trust Instrument. The term trust instrument means the
Trust Instrument of CENTURY REALTY TRUST executed on December 6, 1972, together
with amendments thereto made from time to time.
Section 1.03. By-Laws. The term by-laws means the code of by-laws
of the Trust together with amendments thereto made from time to time.
ARTICLE 2. IDENTIFICATION
Section 2.01. Principal Office and Resident Agent - Power to Change.
The post-office address of the principal office of the Trust is 708 Chamber of
Commerce Building, Indianapolis, Indiana, Marion County; the name and
post-office address of its resident agent in charge of such office is John I.
Bradshaw, Jr., 708 Chamber of Commerce Building, Indianapolis, Indiana 46204.
The location of its principal office, or the designation of its resident agent,
or both, may be changed at any time, or from time to time, when authorized by
the trustees. In case the location of the principal office of the trust is
changed so that the county in which such new principal office is located is a
different county from Marion County, the trust shall immediately record in the
office of the county recorder of the county in which the new principal office
of the Trust is located copies of the original trust instrument and all
amendments thereto certified as true copies by the Secretary of State of
Indiana.
Section 2.02. Seal. The Trust shall not have a seal.
Section 2.03. Fiscal Year. The fiscal year of the Trust shall begin
on the first day of January in each year and end on the last day of December
in the same year.
ARTICLE 3. SHARES
Section 3.01. Number, Par Value. The number and par value of the shares
of this trust as provided for in Section 3.2 of the Trust Instrument may be
changed at any time, or from time to time, when authorized by the Trustees.
Section 3.02. Form of Certificates. Each holder of the shares of the
Trust shall be entitled to a Certificate of Beneficial Interest or Share
Certificate signed by the President and Chairperson of the Board of the
Trust (except that where any such certificate is signed by a Transfer agent
or an assistant Transfer agent or a Transfer clerk and by a registrar, the
signatures of any such President or Chairperson of the Board may be facsimile,
engraved or printed); and shall be countersigned and registered in such manner,
if any, as the Board of Trustees may by resolution prescribe. Each Certificate
of Beneficial Interest shall state the name of the registered holder, the number
of shares represented thereby, that such shares are without par value, and
that such shares have been fully paid and are not liable to any further call
or assessment.
In case any officer or officers who shall have signed, or whose facsimile
signature or signatures shall have been used on any such certificate or
certificates, shall cease to be such officer or officers of the Trust before
such certificate or certificates shall have been delivered by the Trust, such
certificate or certificates may nevertheless be issued and delivered as though
the person or persons who signed such certificate or certificates, or whose
facsimile signature or signatures shall have been used thereon, had not ceased
to be such officer of officers of the Trust, and such issuance and delivery
shall constitute adoption thereof by the Trust.
The form of the certificate shall be substantially as follows but may
vary from time to time as the Trustees may by resolution prescribe:
(Front Side)
5,000,000 Authorized Shares Without Par Value
Number_______________________ _______________________Shares
CENTURY REALTY TRUST
An Indiana Real Estate Investment Trust
CREATED UNDER THE LAWS OF THE STATE OF INDIANA
SHARE CERTIFICATE
THIS CERTIFIES that ________________________________ is the registered
owner of _______________________ shares of Beneficial Interest, without par
value, of
CENTURY REALTY TRUST
fully paid and not liable to any further call or assessment, transferable
only on the books of the Trust in person or by duly authorized attorney-in-fact
upon surrender of this certificate properly endorsed.
This certificate and the shares represented hereby are issued and shall
be held subject to all of the provisions of the Trust Instrument of the Trust
and amendments thereto (copies of which are on file at the principal office
of the Trust), to all of which the holder by the acceptance hereof assents.
No holder or owner of this certificate as such shall have any authority,
power or right whatsoever to do or transact any business for or on behalf of
or binding upon the Trust or any certificate holder thereof.
This certificate in not valid until countersigned and registered by
the Registrar.
WITNESS the facsimile signatures of its duly authorized president and
chairman of the board.
Dated_______________________
____________________________ _____________________________
Chairman of the Board President
Countersigned and Registered:
(Name of Bank)
Indianapolis, Indiana
Registrar
By__________________________
Authorized Officer
(Back Side)
For value received, ____________________________________________ hereby
sell, assign and transfer unto __________________________, _________________
__________ shares of beneficial interest represented by the within certificate,
and do hereby irrevocably constitute and appoint _____________________________,
attorney-in-fact to transfer the said shares on the books of the within named
Trust, with full power of substitution in the premises.
Dated__________________ _________________________________________
(Signature of Registered Holder)
In the presence of ____________________________________________________
(Notary Public)
SIGNATURE GUARANTEED
__________________________________
(Name of Bank)
BY:___________________________________
(Authorized Officer)
This certificate also entitles the holder hereof to certain Rights as set forth
in a Rights Declaration dated as of the Declaration Date (the Rights
Declaration ), the terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal offices of the Trust. Under
certain circumstances, such Rights will be evidenced by separate certificates
and will no longer be evidenced by this certificate. Under certain
circumstances, Rights issued to any Person who becomes an Acquiring Person (as
defined in the Rights Declaration) or related Persons and subsequent holders
thereof, may become null and void.
ARTICLE 4. SHAREHOLDERS
Section 4.01. Meetings. The Annual Meeting of Shareholders shall be
held and such business shall be transacted as provided for in Section 4.1 (1)
of the Trust Instrument. The annual meeting shall be held on the first (1st)
Wednesday after the 31 day of May in each year at ten o'clock (10:00) A.M.
at such place, either within or without the State of Indiana, as shall be
designated in advance by the Trustees and shall be specified in the notice
of the meeting. In the absence of any designation by the Trustees, each such
annual meeting shall be held at the office of the Trust.
Section 4.02. Special Meetings. Special Meetings of the Shareholders
shall be held in accordance with Section 4.1 (2) of the Trust Instrument.
Each special meeting of the shareholders shall be held at such place, either
within or without the State of Indiana, as shall be designated in advance by
the Trustees, and shall be specified in the notice of such meeting. Each such
special meeting shall be held at such time as may be specified in the notice
of such meeting.
Section 4.03. Chairperson and Secretary of Shareholders Meetings. The
chairperson of the board or, in his or her absence, the president of the trust,
shall preside at all meetings of the shareholders as "Chairperson of the
Meeting." If both the chairperson of the board and the president are absent,
the Trustees present at each meeting shall elect one of their number as
Chairperson of the Meeting. Unless otherwise provided for by the trustees,
the secretary of the Trust shall be the secretary of such meetings.
Section 4.04. Construction or Interpretation of Trust Instrument or
By-Laws. At any Shareholder's meeting the Chairman of the Meeting shall
determine the construction or interpretation of the Trust Instrument or the
By-Laws, or any part thereof, and the ruling of the Chairman of the Meeting
shall be final.
Section 4.05. Notice of Meetings. The Shareholders shall receive such
notice of Shareholder's meetings as is provided for in Section 4-1 (3) of the
Trust Instrument. Any shareholder may waive notice of any meeting in writing
either before or after such meeting if the waiver sets forth in reasonable
detail the purpose or purposes for which the meeting is called and the time
and place thereof. Attendance at any meeting in person, or by proxy when the
instrument of proxy sets forth in reasonable detail the purpose or purposes
for which the meeting is called, shall constitute a waiver of notice of such
meeting. Each person who has in the manner provided above waived notice of
a meeting or who personally attends a meeting or is represented at a
shareholders' meeting by a proxy authorized to appear by an instrument of
proxy complying with the requirements above set forth shall be conclusively
presumed to have been given due notice of such meeting.
Section 4.06. Addresses of Shareholders. The address of any shareholder
appearing upon the records of the Trust shall be deemed to be the same address
as the latest address of such shareholder appearing on the records maintained
by the Transfer Agent.
Section 4.07. Voting at Shareholders' Meetings. Except as otherwise
provided by law, every holder of shares of the Trust shall have the right at
every shareholders' meeting to one (1) vote for each share standing in his
or her name on the books of the Trust. No share which belongs to the Trust
shall be voted at any meeting. Shares of the Trust standing in the name of
a corporation may be voted by such officer, agent or proxy as the Board of
Directors of such other corporation may appoint, or as the By-Laws of such
other corporation may prescribe, and in the absence of such designation by
such person as may be nominated in a proxy duly executed for the purpose by
the president or a vice president, and the secretary or an assistant
secretary of such other corporation. Shares held by fiduciaries may be
voted by the fiduciaries in such manner as the instrument or order appointing
such fiduciaries may direct unless the Trust has previously been advised
and furnished proper evidence of other procedures or restrictions with
respect to voting such shares. Shares that are pledged may, unless
otherwise provided in the agreement of pledge, be voted by the shareholder
pledging the same until the shares have been transferred to the pledgee
on the books of the Trust, and thereafter they may be voted by the pledgee.
Section 4.08. Proxies. At all meetings of shareholders a shareholder
may vote by proxy executed in writing by the shareholder or by his duly
authorized attorney-in-fact. Such proxy shall be filed with the secretary
of this trust before or after the time of the meeting. No proxy shall be
valid after eleven (11) months from the date of its execution unless otherwise
provided in the proxy. The form of any such proxy may be prescribed from
time to time by resolution or approval of the Trustees.
Section 4.09. Inspectors of Election and Conduct of Meeting. At all
meetings of the shareholders, the chairman shall appoint an many tellers as
he deems necessary, who shall act as inspectors of election, determine the
validity of the proxies, pass upon the qualification of all persons offering
to vote at such meetings, and to count the ballots. Voting on any question
or in any election may be via voice unless the chairman shall order, or a
majority of the shareholders present shall demand, that voting be by ballot.
ARTICLE 5. TRUSTEES
Section 5.01. Number. The Board of Trustees shall initially consist of
seven (7) persons and thereafter shall consist of such number of Trustees, not
less than five (5) nor more than nine (9), as provided in Section 5.1 of the
Trust Instrument.
Section 5.02. Term. At the first annual meeting of the shareholders,
seven (7) trustees shall be elected, three (3) for a term of three years,
two (2) for a term of two years, and two (2) for a term of one year.
Thereafter all trustees shall be elected for a term of three years as provided
in Section 5.2 of the Trust Instrument.
Section 5.03. Regular Meetings of Trustees. The annual meeting of
the Trustees shall be held immediately following the annual meeting of the
Shareholders, as provided in Section 5.8 of the Trust Instrument. Other
meetings of the Trustees shall be called in accordance with Section 5.8 of
the Trust Instrument at such time and place as shall be designated by the
notice provided for therein. Notice of each Trustees' meeting shall be
mailed or delivered to the last known address of the Trustee or to such
other address as may be specified by the Trustee to the president or
secretary. Written notices need not be manually signed. Unless otherwise
specified in the notice, any and all business may be transacted at any
Trustees' meeting.
Section 5.04. Special Meetings of Trustees. The Trustees shall hold
special meetings in accordance with Section 5.9 of the Trust Instrument at such
time and place as shall be designated by the notice provided for therein.
Notice of each Trustees' meeting shall be mailed or delivered to the last
known address of the Trustee or to such other address as may be specified
by the Trustee to the president or secretary. Written notices need not be
manually signed.
Section 5.05. Place for Trustees' Meetings. All meetings of the
Trustees may be held within or without the State of Indiana.
Section 5.06. Conducting Meetings. Immediately after the annual
meeting of the shareholders, a majority of the Trustees shall elect a
Trustee as president or chairman of the Board of Trustees, who shall preside
at Trustees' meetings; in his absence, the Trustees present at each meeting
shall elect one of their number as chairman. All rules of conduct adopted
and used at Trustees' Meetings, other than those provided for in these By-Laws
and the Trust Instrument, shall be determined by the chairman whose ruling
on all procedure matters and construction of these By-Laws and the Trust
Instrument shall be final.
Section 5.07. Voting at Meetings. Voting at Trustees' meetings may
be conducted orally, by show of hands or, if requested by any Trustee, by
written ballot. The results of all voting shall be recorded by the
Secretary, or in his absence another Trustee, in the minute book.
Section 5.08. Action by Consent. Except as provided for in Section
5.13 of the Trust Instrument, any action required or permitted to be taken
at any meeting of trustees or by a committee thereof may be taken without
a meeting, if prior to such action a written consent to such action is signed
by all trustees or all members of such committee as the case may be, and
such written consent is filed with the minutes of proceedings of the trustees
or committee.
ARTICLE 6. COMMITTEES
Section 6.01. Executive Committee. The Trustees may appoint at least
three (3) of their number to the executive committee of the Trust as provided
in Section 6.2 of the Trust Instrument. The executive committee shall designate
a chairman and secretary. It shall keep minutes of all its meetings.
Reasonable notice of each meeting shall be given by the chairman. Any meeting
shall be a legal meeting without notice thereof having been given if all the
members of the committee shall be present in person. The committee may hold
its meetings within or without the State of Indiana as it may from time to
time determine. A majority of the committee shall be necessary to constitute
a quorum for the transaction of any business, and the act of a majority of
the members present at a meeting at which a quorum is present shall be the
act of the committee. The members of the committee shall act only as a
committee, and the individual members shall have no powers, an such.
Section 6.02. Meetings of Committees. Any action permitted to be
taken at any meeting of any committee may be taken without a meeting if all
members of the committee consent thereto in writing, and the writing or writings
are filed with the minutes of proceedings of the committee.
Section 6.03. Rules and Regulations of Committees. Each committee
(including the Executive Committee) elected or appointed by the Trustees may
adopt such standing rules and regulations for the conduct of its affairs except
those specified in those By-Laws and in the Trust Instrument, as it may deem
desirable, subject to review and approval of such rules and regulations by
the Trustees at the next succeeding meeting of the Trustees.
ARTICLE 7. OFFICERS
Section7.01(a). Chairperson of the Board. The position of chairperson
of the board, if there is one, shall be chosen from among the Trustees. The
chairperson shall act as chair of all meetings of the trustees and of the
shareholders and shall perform such other duties as the Board of Trustees
may from time to time assign. The chairperson of the board shall have the
authority to call special meetings of the trustees or of the shareholders.
Section 7.01 (b). The President. The president shall be the chief
executive officer of the Trust and shall have general charge, direction, and
supervision of the Trust's business affairs and over its officers, agents
and employees. The president shall appoint and discharge employees and
agents of the Trust (other than officers elected or agents selected by
the Board of Trustees), and shall see that orders and resolutions of the
Board of Trustees are carried into effect. In the absence of the chairperson
of the board, the president shall preside at all meetings of the shareholders
and of the trustees. The president shall sign with the chairperson of the
board, or in his absence, the secretary, or other proper officers of this
Trust thereunto authorized by the Trust, certificates for shares of the
Trust. The president shall have power to execute, acknowledge and deliver
all deeds, bonds, contracts and other obligations and documents in the name
of the Trust which the trustees have authorized to have executed. The
president shall have such other powers and duties as may, from time to
time, be prescribed by the Board of Trustees.
Section 7.02. Vice-President. In the absence of the president, or
in the event of the inability or refusal of the president to act, like power
and authority shall be vested in the vice-presidents, if any, each serving
in the order of his election.
Section-7.03. Treasurer. The treasurer shall: (a) have charge and
custody of and be responsible for all funds and securities of this trust;
receive and give receipts for moneys due and payable to this trust from any
source whatsoever, and deposit all such moneys in the name of this trust
in such banks, trust companies or other depositories as shall be selected
in accordance with the provisions of this trust; and (b) in general, perform
all duties incident to the office of treasurer and such other duties as,
from time to time, may be assigned to him by the president or by the trustees.
Section 7.04. Secretary. The secretary shall: (a) keep the minutes
of the shareholders' and of the trustees' meetings in one or more books
provided for that purpose; (b) see that all notices are duly given in
accordance with the provisions of this trust; (c) be custodian of the
trust records; (d) keep or cause to be kept a register of the post
office address of each shareholder, which shall be furnished to the
secretary by such shareholder; (e) sign with the president certificates
for shares of this trust; (f) have general charge of the stock transfer
books of this trust; and (g) in general, perform all duties incident to
the office of secretary and such other duties as from time to time may be
assigned to him by the president or by the trustees.
Section 7.05. Asst. Treasurers and Asst. Secretaries. The assistant
treasurers and assistant secretaries, if any, in general shall perform such
duties as shall be assigned to them by the treasurer or secretary, respectively,
or by the president or trustees.
Section 7.06. Filling Vacancies and Appointing New Officers. Any
vacancy of the offices of President, Secretary and Treasurer shall be filled
by an election at any meeting of the Trustees. Those individuals selected
to fill the vacancies of the office of president, secretary, or treasurer
shall be elected by a majority vote of the Trustees and shall hold the office
for the remainder of the term. All other officers of the Trust may be
appointed by the president. Such officers shall hold office for any term
as determined by the Trustees or president subject to removal with or without
cause, at any time by the Trustees or president. The names of all such officers
appointed by the president shall be submitted at the next succeeding meeting
of the Trustees and recorded in the minutes of said meeting.
Section 7.07. Delegation of Duties. Duties of officers may be delegated.
In case of the absence or disability of any officer of the Trust, or for any
other reason that the Board may deem sufficient, the Board may delegate, for
the time being the powers or duties, or any of them, of such officer to any
other officer, or to any Trustee.
Section 7.08. Loans. No loans shall be contracted on behalf of this
trust and no evidence of indebtedness shall be issued in its name by any
officer unless authorized by a resolution of the trustees. Such authority
may be general or confined to specific loans or evidences of indebtedness.
Section 7.09. Checks and Drafts. All checks, drafts or other orders
for the payment of money, notes or other evidences of indebtedness issued
in the name of this trust shall be signed by such officer or officers of this
trust and in such manner as shall from time to time be determined by resolution
of the trustees.
Section 7.10. Deposits. All funds of this trust not otherwise employed
shall be deposited from time to time by the officers to the credit of this
trust in such banks, trust companies or other depositories as the trustees may
select.
ARTICLE 8. EXECUTION OF WRITTEN INSTRUMENTS.
Section 8.01. Execution of Negotiable Instruments. All checks, drafts,
notes, bonds, bills of exchange and orders for the payment of money of the
Trust shall, unless otherwise directed by the trustees, or unless otherwise
required by laws be signed by the President or Secretary and one other trustee.
The trustees may, however, authorize by resolution any one of such officers or
an employee of the Trust to sign checks, drafts, and orders for the payment
of money, which are for respective amounts not in excess of one thousand
dollars ($1,000) in any case, singly and without necessity of
countersignature.
Section 8.02. Execution of Deeds, Mortgages, Etc. All deeds, mortgages
and leases made by the Trust and all other written instruments to which the
Trust shall be a party shall be executed in its name by the President and
Secretary. The trustees may, however, by resolution authorize any Trust
Officer or employee to execute any such written instrument singly and
without necessity of countersignature upon such terms and conditions as
the trustees deem appropriate.
Section 8.03. Endorsement of Stock Certificates. Any share or shares
of stock issued by any corporation and owned by the Trust may, for sale or
transfer, be endorsed in the name of the Trust by the President, and such
endorsement shall be duly attested by the Secretary.
Section 8.04. Voting of Stock Owned by Trust. Any share or shares
of stock issued by any corporation and owned or controlled by the Trust may
be voted at any stockholders' meeting of such corporation by the President
of the Trust if he is present, or in his absence by any Trust officer or
employee designated by the President. Whenever in the judgment of the
President it is desirable for the Trust to execute a proxy or give a
shareholder's consent in respect to any share or shares of stock issued
by any corporation and owned by the Trust, such proxy or consent shall
be executed in the name of the Trust by the President and shall be attested
by the Secretary of the Trust. Any person or persons designated in the
manner above stated as the proxy or proxies of the Trust shall have full
right, power and authority to vote the share or shares of stock issued by
such corporation and owned by the Trust the same an such share or shares
might be voted by the Trust.
ARTICLE 9. AMENDMENTS
Section 9.01. These By-Laws may be amended or repealed, or new by-laws
adopted, at any meeting of the Board of Trustees by the Vote of at least a
majority of the entire Board.
Section 9.02. Any proposal to amend or repeal these By-Laws or to adopt
new by-laws shall be stated in the notice of the meeting of the Board of
Trustees, or in the waiver of notice thereof, as the case may be, unless all
of the Trustees are present at such meeting.
EXHIBIT 4.1
SPECIMEN CERTIFICATE
(Front Side)
5,000,000 Authorized Shares Without Par Value
Number_______________________ _______________________Shares
CENTURY REALTY TRUST
An Indiana Real Estate Investment Trust
CREATED UNDER THE LAWS OF THE STATE OF INDIANA
SHARE CERTIFICATE
THIS CERTIFIES that _________________________ is the registered owner of
________________________ shares of Beneficial Interest, without par value, of
CENTURY REALTY TRUST
fully paid and not liable to any further call or assessment, transferable only
on the books of the Trust in person or by duly authorized attorney-in-fact
upon surrender of this certificate properly endorsed.
This certificate and the shares represented hereby are issued and shall
be held subject to all of the provisions of the Trust Instrument of the Trust
and amendments thereto (copies of which are on file at the principal office
of the Trust), to all of which the holder by the acceptance hereof assents.
No holder or owner of this certificate as such shall have any authority,
power or right whatsoever to do or transact any business for or on behalf of
or binding upon the Trust or any certificate holder thereof.
This certificate in not valid until countersigned and registered by the
Registrar. WITNESS the facsimile signatures of its duly authorized president
and chairman of the board.
Dated_______________________
____________________________ _____________________________
Chairman of the Board President
Countersigned and Registered:
(Name of Bank)
Indianapolis, Indiana
Registrar
By__________________________
Authorized Officer
(Back Side)
For value received, ______________________________________ hereby sell,
assign and transfer unto _______________________________, _________________
_________ shares of beneficial interest represented by the within certificate,
and do hereby irrevocably constitute and appoint ____________________________,
attorney-in-fact to transfer the said shares on the books of the within named
Trust, with full power of substitution in the premises.
Dated__________________ _________________________________________
(Signature of Registered Holder)
In the presence of _______________________________________________
(Notary Public)
SIGNATURE GUARANTEED
__________________________________
(Name of Bank)
BY:___________________________________
(Authorized Officer)
This certificate also entitles the holder hereof to certain Rights as set
forth in a Rights Declaration dated as of the Declaration Date (the Rights
Declaration ), the terms of which are hereby incorporated herein by reference
and a copy of which is on file at the principal offices of the Trust. Under
certain circumstances, such Rights will be evidenced by separate certificates
and will no longer be evidenced by this certificate. Under certain
circumstances, Rights issued to any Person who becomes an Acquiring Person
(as defined in the Rights Declaration) or related Persons and subsequent
holders thereof, may become null and void.
EXHIBIT 5.1
[Henderson Daily Withrow & DeVoe Letterhead]
September __, 1999
Century Realty Trust
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
Ladies and Gentlemen:
We have acted as counsel to Century Realty Trust, an Indiana business
trust (the "Company"), in connection with the registration under the Securities
Act of 1933, as amended (the "Act"), on a registration statement of the Company
on Form S-3 (the "Registration Statement") filed with the Securities and
Exchange Commission (the "Commission") of 286,908 shares (the "Shares") of
beneficial interest, no par value, of the Company. This opinion is being
provided at your request in connection with the filing of the Registration
Statement.
The Shares (plus such additional shares as may be issued pursuant to
certain antidilution provisions) may be issued by the Company from time to
time in exchange for a like number of operating partnership units ("OPU's)
of Barcelona Apartments, L.P., an Indiana limited partnership, Beech Grove
apartments, L.P., an Indiana limited partnership, Hampton Court Apartments,
L.P., an Indiana limited partnership, Sheffield Square apartments, L.P., an
Indiana limited partnership, and WestWind Terrace Apartments, L.P., an Indiana
limited partnership (each an "Acquiring Partnership" and collectively the
"Acquiring Partnerships"). All of the Shares may be offered for sale from
time to time by certain shareholders.
In rendering the opinion expressed herein, we have examined the
Registration Statement, the Trust Instrument and By-Laws of the Company,
the Certificate of Limited Partnership and Limited Partnership Agreement
for each of the Acquiring Partnerships, the Acquisition Agreement dated July
18, 1997 among various parties and pursuant to which the Acquiring Partnerships
acquired certain apartment projects by issuing the OPU's and assuming certain
indebtedness, the proceedings of the Board of Trustees of the Company relating
to the reservation and issuance of the Shares, a Certificate of the Officers
of the Company (the "Certificates"), and such other statutes, certificates,
instruments, and documents relating to the Company and matters of law as we
have deemed necessary to the issuance of this opinion.
In our examination of the aforesaid documents, we have assumed, without
independent investigation, the genuineness of all signatures, the legal
capacity of all individuals who have executed any of the aforesaid documents,
the authenticity of all documents submitted to us as originals, the conformity
with originals of all documents submitted to us as copies (and the authenticity
of the originals of such copies), and the accuracy and completeness of all
public records reviewed by us. In making our examination of documents
executed by parties other than the Company, we have assumed that such parties
had the power, corporate or other, to enter into and perform all obligations
thereunder, and we have also assumed the due authorization by all requisite
action, corporate or other, and the valid execution and delivery by such parties
of such documents and the validity, binding effect and enforceability thereof
with respect to such parties. As to facts material to this opinion, we have
relied solely upon the Certificates. We have also assumed that the number of
shares of beneficial interest available for issuance under the Trust Instrument
of the Company will exceed the number of Shares to be issued from time to time
as contemplated in the second paragraph of this opinion.
Based upon the foregoing, having regard for such legal considerations
as we deem relevant, and limited in all respects to applicable Indiana law,
we are of the opinion and advise you that the Shares to be issued in exchange
for the OPU's in accordance with the terms of the Acquisition Agreement, and
issuance and delivery of certificates representing the Shares, will be validly
issued, fully paid, and non-assessable when issued in accordance with the
Acquisition Agreement.
In addition to the qualifications set forth above, this opinion is
subject to the qualification that we express no opinion as to the laws of
any jurisdiction other than the State of Indiana. We assume that the issuance
of the Shares will not violate any of the Ownership Limit provisions of the
Company's Trust Instrument. This opinion concerns only the effect of the laws
(exclusive of the securities or "blue sky" laws and the principles of conflict
of laws) of the State of Indiana as currently in effect. We assume no
obligation to supplement this opinion if any applicable laws change after the
date hereof or if any facts or circumstances come to our attention after the
date hereof that might change this opinion.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the heading
"Legal Matters" in the Prospectus included in the Registration Statement.
In giving our consent, we do not thereby admit that we are in the category
of persons whose consent is required under Section 7 of the Act or the rules
and regulations of the Commission thereunder.
Sincerely,
Henderson, Daily, Withrow & DeVoe
OWD/csf/adb
EXHIBIT 8.1
[Henderson, Daily, Withrow & DeVoe Letterhead]
September ___, 1999
Board of Trustees
Century Realty Trust
320 North Meridian Street
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
Re: Certain Federal Income Tax Consequences
Ladies and Gentlemen:
We have acted as counsel to Century Realty Trust, an Indiana business
trust (the "Company"), in connection with the registration statement on Form S-3
(the "Registration Statement") and the prospectus included therein (the
"Prospectus") filed by the Company with the Securities and Exchange Commission
relating to the possible issuance by the Company of up to 286,908 shares (the
"Shares") of beneficial interests, no par value, to the extent that the Company
elects to issue the Shares to the holders of 286,908 operating partnership units
("Units") in Barcelona Apartments, L.P., Beech Grove Apartments, L.P., Hampton
Court Apartments, L.P., Sheffield Square Apartments, L.P. and WestWind Terrace
Apartments, L.P. (collectively, the "Operating Partnerships") upon the tender
of such Units for redemption. In connection with the Registration Statement,
we have been asked to provide you with our opinions on certain federal income
tax matters. Capitalized terms used in this letter and not otherwise defined
herein have the meanings set forth in the Registration Statement.
The opinions set forth in this letter are based on relevant provisions of
the Internal Revenue Code of 1986, as amended (the "Code"), Treasury Regulations
thereunder (including proposed and temporary Treasury Regulations), and
interpretations of the foregoing as expressed in court decisions, the
legislative history, and existing administrative rulings and practices of the
Internal Revenue Service (including its practices and policies in issuing
private letter rulings, which are not binding on the Internal Revenue Service
except with respect to a taxpayer that receives such a ruling), all as of the
date hereof. These provisions and interpretations are subject to change, which
may or may not be retroactive in effect, that might result in modifications of
our opinions. Our opinions do not foreclose the possibility of a contrary
determination by the Internal Revenue Service or a court of competent
jurisdiction, or of a contrary position by the Internal Revenue Service or the
Treasury Department in regulations or rulings issued in the future. We express
no opinion as to the laws of any jurisdiction other than the Federal laws of
the United States of America to the extent specifically referred to herein.
In connection with the Registration Statement, we have acted as counsel
to the Company and we have assisted in the preparation of the Registration
Statement and certain other documents. In formulating our opinions, we have
examined originals or copies, certified or otherwise identified to our
satisfaction, of the Registration Statement and such other documentation
and information provided by you as is relevant and necessary to prepare the
Registration Statement or as we have deemed necessary or appropriate as a
basis for the opinions set forth herein. In addition, you have provided us
with certain representations and covenants of officers of the Company relating
to, among other things, the election of the Company to be taxed as a real estate
investment trust ("REIT") under the Code for its taxable year ended December 31,
1978, and the preparation and filing of tax returns of the Company for each of
the taxable years of the Company since then up to and including December 31,
1998, and the actual and proposed operations of the Company. For purposes of
our opinions, we have not made an independent investigation of the facts set
forth in such representations, the partnership agreements and organizational
documents for each of the partnerships, corporation and limited liability
company in which the Company holds a direct or indirect interest, including,
without limitation, CR Management, Inc. ("CR Management") and Charter Oaks
Associates, LLC, ("Charter Oaks"), the Registration Statement or any other
document. We have, consequently, assumed and relied on your representations
that the information presented in such documents or otherwise furnished to us
accurately and completely describes all material facts relevant to our opinions.
No facts have come to our attention, however, that would cause us to question
the accuracy and completeness of such facts or documents in a material way.
In our review, we have assumed, with your consent, that:
(i) All of the representations and statements set forth in the documents
we reviewed (the "Reviewed Documents") are true and correct, any
such representation or statement made as a belief or made "to the
knowledge of" or similarly qualified is correct and accurate without
such qualification, and all of the obligations imposed by any such
document on the parties thereto have been and will be performed or
satisfied in accordance with their terms;
(ii) The Company, the Operating Partnerships, CR Management, and Charter
Oaks each have been and will continue to be operated in the manner
described in the relevant partnership agreement, operating
agreement, articles of incorporation or other organizational
documents and in the Prospectus;
(iii) All signatures to the Reviewed Documents are genuine, all documents
were properly executed, all documents submitted to us as originals
are authentic, all documents submitted to us as copies conform to
the originals, and all original documents from which any copies
were made are authentic;
(iv) The Company is a validly organized and duly formed and existing
business trust under the laws of the State of Indiana. CR Management
is a duly organized and validly formed and existing corporation
under the laws of the State of Indiana. Charter Oaks is a duly
organized and validly formed and existing limited liability company
under the laws of the State of Indiana and is treated, and qualifies
for treatment, as a partnership for federal and state tax purposes.
The Operating Partnerships are duly organized and validly formed
and existing limited partnerships under the laws of the states in
which they are organized and are treated, and qualify for treatment,
as partnerships for federal and state tax purposes; and
(v) The Company has timely and duly filed annual federal tax returns
and state tax returns in all jurisdictions in which its operations
require it to file such returns, for each tax year of the Company
since tax year ended December 31, 1978, through tax year ended
December 31, 1997; the Company has obtained valid extensions of
time to file its required tax returns for tax year ended December
31, 1998; and the Company will timely and duly file such returns
for tax year ended December 31, 1998.
For the purpose of our opinions, we have not made an independent
investigation of the facts set forth in the Reviewed Documents. We
consequently have assumed that the information presented in such documents,
or otherwise furnished to us, accurately and completely describes all material
facts relevant to our opinions. No facts have come to our attention, however,
that would cause us to question the accuracy and completeness of such facts
or documents in a material way. Any variation or difference in the facts
from those set forth in the Reviewed Documents may affect the conclusions
stated herein. In addition, if any one of the statements, representations,
warranties or assumptions upon which we have relied to issue this opinion
letter is incorrect, our opinions might be adversely affected and may not
be relied upon.
Based upon, and subject to, the foregoing and the next paragraph below,
we are of the opinion that:
1. Commencing with the Company's tax year ended December 31, 1978, the
Company was organized in conformity with the requirements for
qualification as a REIT under the Code, and its actual methods of
operation has enabled and its proposed methods of operation should
enable the Company to meet the requirements for qualification and
taxation as a REIT. As noted in the Registration Statement, the
Company's qualification and taxation as a REIT depend upon its
ability to meet, through actual annual operating results, certain
requirements, including requirements relating to distribution levels
and diversity of share ownership, and the various qualification
tests imposed under the Code, the results of which are not reviewed
by us. Accordingly, no assurance can be given that the actual results
of the Company's operation for any one taxable year satisfy the
requirements for taxation as a REIT under the Code.
2. Although the discussion set forth in the Prospectus under the
caption "CERTAIN FEDERAL INCOME TAX CONSEQUENCES" does not purport
to discuss all possible United States Federal income tax consequences
of the purchase, ownership and disposition of the Shares, such
discussion, although general in nature, constitutes, in all material
respects, a fair and accurate summary under current law of certain
material United States Federal income tax consequences of the
purchase, ownership and disposition of the Shares by a holder who
purchases such Shares, subject to the qualifications set forth
therein. The United States Federal income tax consequences of an
investment in the Shares by an investor will depend upon that
holder's particular situation, and we express no opinion as to
the completeness of the discussion set forth in "CERTAIN FEDERAL
INCOME TAX CONSEQUENCES" as applied to any particular holder.
This opinion letter is limited to the two opinions stated above. Our
opinions do not, and are not intended to, address the tax consequences to any
holder of Units with respect to the acquisition, ownership, redemption or
disposition of its Units. For purposes of the second opinion stated above,
the term "Prospectus" does not include the documents incorporated by reference
in the Prospectus.
The Company's qualification and taxation as a REIT depends upon the
Company's ability to meet on a continuing basis, through actual annual operating
and other results, the various requirements under the Code and described in
the Prospectus with regard to, among other things, the sources of its gross
income, the composition of its assets, the level of its distributions to
shareholders, and the diversity of its share ownership. Henderson, Daily,
Withrow & DeVoe will not review the Company's compliance with these
requirements on a continuing basis. No assurance can be given that the
actual results of the operations of the Company, the Operating Partnerships,
CR Management and Charter Oaks, the sources of their income, the nature of
their assets, the level of the Company's distributions to shareholders and
the diversity of its share ownership for any given taxable year will satisfy
the requirements under the Code for qualification and taxation as a REIT.
For a discussion relating the law to the facts and the legal analysis
underlying the opinions set forth in this letter, we incorporate by reference
the discussion of Federal income tax issues, which we assisted in preparing,
in the section of the Prospectus under the heading "CERTAIN FEDERAL INCOME
TAX CONSIDERATIONS."
An opinion of counsel merely represents counsel's best judgment with
respect to the probable outcome on the merits and is not binding on the Internal
Revenue Service or the courts. There can be no assurance that positions
contrary to our opinions will not be taken by the Internal Revenue Service,
or that a court considering the issue would not hold contrary to our opinions.
Furthermore, no assurance can be given that future legislative, judicial or
administrative changes, on either a prospective or retroactive basis, would
not adversely affect the accuracy of the opinions expressed herein.
Nevertheless, we undertake no responsibility to advise you of any such
changes.
This opinion letter has been prepared for your benefit in connection
with the filing of the Registration Statement. This opinion letter may not
be used or relied upon by any other person or for any other purpose and may
not be disclosed, quoted, filed with any governmental agency or otherwise
referred to without the prior written consent of this firm. We hereby consent
to the filing of this opinion letter as an exhibit to the Registration
Statement and to the reference to Henderson, Daily, Withrow & DeVoe under
the caption "CERTAIN FEDERAL INCOME TAX CONSIDERATIONS" in the Registration
Statement. In giving this consent, we do not thereby admit that we are an
"expert" within the meaning of the Securities Act of 1933, as amended.
Very truly yours,
/s/ Henderson, Daily, Withrow & DeVoe
EXHIBIT 23.1
[Henderson Daily Withrow & DeVoe Letterhead]
September __, 1999
Century Realty Trust
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
Ladies and Gentlemen:
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm under the heading
"Legal Matters" in the Prospectus included in the Registration Statement.
In giving our consent, we do not thereby admit that we are in the category
of persons whose consent is required under Section 7 of the Act or the rules
and regulations of the Commission thereunder.
Sincerely,
Henderson, Daily, Withrow & DeVoe
OWD/csf/adb
EXHIBIT 23.2
[Henderson, Daily, Withrow & DeVoe Letterhead]
September ___, 1999
Board of Trustees
Century Realty Trust
320 North Meridian Street
823 Chamber of Commerce Building
Indianapolis, Indiana 46204
Re: Certain Federal Income Tax Consequences
Ladies and Gentlemen:
We hereby consent to the filing of this opinion letter as an
exhibit to the Registration Statement and to the reference to Henderson,
Daily, Withrow & DeVoe under the caption "CERTAIN FEDERAL INCOME TAX
CONSIDERATIONS" in the Registration Statement. In giving this consent,
we do not thereby admit that we are an "expert" within the meaning of the
Securities Act of 1933, as amended.
Very truly yours,
/s/ Henderson, Daily, Withrow & DeVoe
EXHIBIT 23.3
CONSENT TO INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3) of Century Realty Trust for the registration
of 286,908 Shares of Beneficial Interest and to the incorporation by reference
therein of our report dated February 17, 1999, with respect to the consolidated
financial statements and financial statement schedule of Century Realty Trust
included in its Annual Report (Form 10K) for the year ended December 31, 1998,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Indianapolis, Indiana
August 27, 1999