EQUITY RESIDENTIAL PROPERTIES TRUST
LEXFORD RESIDENTIAL TRUST
ARTICLES OF MERGER
EQUITY RESIDENTIAL PROPERTIES TRUST, a Maryland real estate
investment trust ("EQR"), and LEXFORD RESIDENTIAL TRUST, a Maryland real
estate investment trust ("Lexford"), certify to the State Department of
Assessments and Taxation of Maryland:
THE MERGER. Pursuant to that certain Agreement and Plan of Merger by
and between EQR and Lexford, dated as of June 30, 1999 (the "Merger
Agreement"), EQR and Lexford agree to merge in the manner hereinafter set
forth. Subject to the acceptance for record of these Articles of Merger
("Articles") by the State Department of Assessments and Taxation of Maryland
(the "Department") and the occurrence of the Effective Time (as defined
below), Lexford shall be merged with and into EQR in accordance with Section
8-501.1 of the Corporations and Associations Article ("C&A Article") of the
Annotated Code of Maryland (the "Maryland Code"), and the separate existence
of Lexford shall thereupon cease (the "Merger").
1. FORMATION. EQR was formed under Title 8 of the C&A Article
of the Maryland Code ("Title 8"). Lexford was formed under Title 8.
2. PRINCIPAL OFFICES. The principal office of EQR in the State
of Maryland is located in Harford County. The principal office of Lexford in
the State of Maryland is located in Baltimore City.
3. OWNERSHIP OF LAND INTERESTS. Lexford owns no interests in
land located within the State of Maryland.
4. DECLARATION OF TRUST. The Second Amended and Restated
Declaration of Trust of EQR (the "EQR Declaration") shall be amended by the
amendment set forth in Exhibit "A" attached to these Articles, until duly
amended in accordance with its terms and applicable law.
5. EFFECTIVE TIME. The Merger shall be effective at the time
the Department accepts these Articles for record (the "Effective Time"). The
date on which the Effective Time occurs is herein referred to as the
"Effective Date".
6. EFFECTS. The Merger shall have the effects specified in
Section 8-501.1(n) of Title 8. At the Effective Time Lexford shall be merged
into EQR; and thereupon all the properties, rights, privileges, powers and
franchises of Lexford shall vest in EQR and all debts, liabilities and duties
of Lexford shall become the debts, liabilities and duties of EQR. If at any
time EQR shall consider or be advised that any further assignments,
conveyances or assurances in law are necessary or desirable
to vest, perfect or confirm in EQR the title to any property or rights of EQR
or Lexford or otherwise to carry out the provisions hereof, the persons who
are the proper officers and trustees of EQR or Lexford immediately prior to
the Effective Time (or their successors in office) shall execute and deliver
any and all proper deeds, assignments and assurances in law, and do all
things necessary or proper, to vest, perfect or confirm title to such
property or rights in EQR and otherwise to carry out the provisions hereof.
EQR shall continue to be governed by Title 8.
7. APPROVAL OF MERGER. The terms and conditions of the Merger
were duly advised, authorized and approved by EQR in the manner and by the
vote required by Title 8, the EQR Declaration and the Third Amended and
Restated Bylaws of EQR (the "EQR Bylaws") as follows:
(a) The Board of Trustees of EQR, at a meeting duly
called and held, adopted a resolution, filed with the
minutes of proceedings of the Board, declaring that
the Merger described herein was advisable on
substantially the terms and conditions set forth in
the resolution and directing that the proposed
transaction be submitted for consideration by the
shareholders of EQR.
(b) The shareholders of EQR entitled to vote on the
proposed merger, at a meeting duly called and held,
approved the Merger.
The terms and conditions of the Merger were duly advised,
authorized and approved by Lexford in the manner and by the vote required by
Title 8, the Declaration of Trust of Lexford (the "Lexford Declaration") and the
Bylaws of Lexford as follows:
(a) The Board of Trustees of Lexford, at a meeting duly
called and held, adopted a resolution, filed with the
minutes of proceedings of the Board, declaring that
the Merger described herein was advisable on
substantially the terms and conditions set forth in
the resolution and directing that the proposed
transaction be submitted for consideration by the
shareholders of Lexford.
(b) The shareholders of Lexford entitled to vote on the
proposed merger, at a meeting duly called and held,
approved the Merger.
The shareholders of Lexford are not entitled to any appraisal rights in
connection with the Merger.
8. CAPITAL.
(a) The Lexford Declaration as in effect immediately
prior to the Effective Time authorizes the issuance of 110,000,000
shares of beneficial interest, of which 50,000,000 are common shares,
$0.01 par value per share ("Lexford Common"), 5,000,000 are preferred
shares, $0.01 par value per share, 50,000,000 are excess common shares,
$0.01 par value per
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share and 5,000,000 are excess preferred shares, $0.01 par value per
share. The aggregate par value of all the authorized shares of
beneficial interest of Lexford is $1,100,000.
(b) EQR's Declaration authorizes the issuance of
450,000,000 shares of beneficial interest, of which 350,000,000 are
common shares, $0.01 par value per share ("EQR Common"), and
100,000,000 are preferred shares, $0.01 par value per share. EQR has
established the following series of preferred shares: (i) 6,900,000
shares of 9-3/8% Series A Cumulative Redeemable Preferred Shares of
Beneficial Interest, $0.01 par value per share; (ii) 575,000 shares of
9-1/8% Series B Cumulative Redeemable Preferred Shares of Beneficial
Interest, $0.01 par value per share; (iii) 460,000 shares of 9-1/8%
Series C Cumulative Redeemable Preferred Shares of Beneficial Interest,
$0.01 par value per share; (iv) 805,000 shares of 8.60% Series D
Cumulative Redeemable Preferred Shares of Beneficial Interest, $0.01
par value per share; (v) 4,600,000 shares of Series E Cumulative
Convertible Preferred Shares of Beneficial Interest, $0.01 par value
per share; (vi) 2,300,000 shares of Series F Cumulative Redeemable
Preferred Shares of Beneficial Interest, $0.01 par value per share;
(vii) 1,265,000 shares of 7-1/4% Series G Convertible Cumulative
Preferred Shares of Beneficial Interest, $0.01 par value per share;
(viii) 164,951 shares of Series H Cumulative Convertible Preferred
Shares of Beneficial Interest, $0.01 par value per share; (ix)
4,000,000 shares of Series I Cumulative Convertible Preferred Shares of
Beneficial Interest, $0.01 par value per share; (x) 4,599,400 shares of
Series J Cumulative Convertible Preferred Shares of Beneficial
Interest, $0.01 par value per share; (xi) 1,000,000 shares of Series K
Cumulative Redeemable Preferred Shares of Beneficial Interest, $0.01
par value per share; (xii) 4,000,000 shares of Series L Cumulative
Redeemable Preferred Shares of Beneficial Interest, $0.01 per value per
share and (xiii) 800,000 shares of Series M Cumulative Redeemable
Preferred Shares of Beneficial Interest, $0.01 par value per share. The
aggregate par value of all the authorized shares of beneficial interest
of EQR is $4,500,000.
9. CONVERSION. The manner of converting the shares of
Lexford shall be as follows:
(a) Subject to the provisions of Section 9(c) hereof, at
the Effective Time, each share of Lexford Common outstanding
immediately prior to the Effective Time shall, without any action on
the part of the holder thereof, be converted into 0.463 of a share of
EQR Common, except for shares of Lexford Common owned by EQR or a
direct or indirect subsidiary of EQR, which shall be canceled.
(b) At the Effective Time, each certificate evidencing
outstanding shares of Lexford Common will, without any action on the
part of the holder thereof, thereafter represent the right to receive,
without interest, a certificate evidencing the EQR Common as calculated
pursuant to Section 9(a) above and cash in lieu of fractional shares of
the EQR Common in accordance with Section 9(c), upon the surrender of
such Lexford certificate or certificates.
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(c) Notwithstanding any other provision hereof, no
fractional shares of EQR Common shall be issued in connection with the
Merger. Instead, each holder of outstanding Lexford Common having a
fractional interest arising upon the conversion or exchange of such
shares in connection with the Merger shall, at the time of surrender of
its Lexford certificate or certificates, be paid an amount in cash
equal to the Closing Price (as hereinafter defined) multiplied by the
fraction of a share of EQR Common to which such holder would otherwise
be entitled. In the event that any one holder holds more than one
certificate evidencing Lexford Common, the shares evidenced by all such
certificates surrendered together for conversion or exchange shall be
aggregated and one new certificate evidencing EQR Common shall be
issued in respect of such certificates evidencing Lexford Common,
insofar as is necessary to reduce the number of fractional interests in
respect of EQR Common which would otherwise arise. No such holder shall
be entitled to dividends or other distributions, voting rights or any
other shareholder rights in respect of any fractional share. For
purposes of this Section 9(c), "Closing Price" shall mean the
unweighted average closing price of a share of EQR Common (as reported
in the New York Stock Exchange, Inc. Composite Tape) for the five (5)
Trading Days immediately preceding the Effective Date, and "Trading
Day" shall mean any day on which EQR Common is traded on the New York
Stock Exchange and reported on its Composite Tape.
(d) At the Effective Time, each outstanding option to
purchase Lexford Common (a "Lexford Share Option" or collectively
"Lexford Share Options") shall be amended to (i) adjust the number of
shares for which such option is thereafter exercisable by multiplying
such number of shares by 0.463, (ii) adjust the per share exercise
price by dividing such exercise price by 0.463 and (iii) to provide
that such option shall be exercisable for shares of EQR Common.
10. EXCHANGE OF CERTIFICATES.
(a) As of the Effective Time, EQR shall deposit, or shall
cause to be deposited, with an exchange agent selected by EQR (the
"Exchange Agent"), for the benefit of the holders of certificates
evidencing shares of Lexford Common (the "Lexford Certificates"), for
exchange in accordance with this Section 10, certificates evidencing
the EQR Common (the "EQR Certificates") to be issued pursuant to this
Section 10.
(b) Promptly after the Effective Time, EQR shall cause
the Exchange Agent to mail to each holder of record of Lexford Common a
letter of transmittal which shall specify (i) that delivery shall be
effected, and risk of loss and title to Lexford Certificates shall
pass, only upon delivery of such Lexford Certificates to the Exchange
Agent, and shall be in such form and have such other provisions as EQR
may reasonably specify, and (ii) instructions for use in effecting the
surrender of such Lexford Certificates in exchange for EQR Certificates
and cash in lieu of fractional shares of EQR Common. Upon surrender of
one or more Lexford Certificates for cancellation to the Exchange
Agent, duly executed and completed in accordance with the instructions
thereto, together with such letter of transmittal, the holder
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of such Lexford Certificates so surrendered shall be entitled to
receive in exchange therefor (x) a EQR Certificate evidencing the
number of whole shares of EQR Common and (y) a check representing the
amount of cash in lieu of fractional shares of EQR Common, if any, and
unpaid dividends and distributions, if any, which such holder has the
right to receive pursuant to the provisions of Section 9(c) in respect
of the one or more Lexford Certificates surrendered, after giving
effect to any required withholding tax, and the one or more Lexford
Certificates so surrendered shall forthwith be canceled. No interest
will be paid or accrued on the cash in lieu of fractional shares of EQR
Common and unpaid dividends and distributions, if any, payable to
holders of Lexford Certificates. In the event of a transfer of
ownership of Lexford Common which is not registered in the transfer
records of Lexford, EQR Certificates evidencing the proper number of
EQR Common, together with a check for the cash to be paid in lieu of
any fractional shares of EQR Common, if any, and unpaid dividends and
distributions, if any, which such holder has the right to receive
pursuant to Section 9(c) in respect of the Lexford Certificate so
surrendered, after giving effect to any required withholding tax, may
be issued to such a transferee if the Lexford Certificate is presented
to the Exchange Agent, accompanied by all documents required to
evidence and effect such transfer and to evidence that any applicable
share transfer taxes have been paid. All Lexford Certificates so
surrendered will be canceled forthwith. Notwithstanding the foregoing,
neither the Exchange Agent nor any party hereto shall be liable to a
holder of Lexford Common for any EQR Common or dividends or other
distributions thereon, or cash in lieu of any fractional EQR Common,
delivered to a public official pursuant to applicable abandoned
property, escheat or other applicable law.
(c) Notwithstanding any other provisions of these
Articles, no dividends or other distributions on EQR Common with a
record date after the Effective Time shall be paid with respect to any
EQR Common evidenced by a Lexford Certificate until such Lexford
Certificate is surrendered for exchange as provided herein. Subject to
the effect of applicable laws, following surrender of any such Lexford
Certificate, there shall be paid to the holder of the EQR Certificate
issued in exchange therefor, without interest, (i) at the time of such
surrender, the amount of dividends or other distributions with a record
date after the Effective Time theretofore payable with respect to such
whole shares of EQR Common and not paid, less the amount of any
withholding taxes which may be required thereon, and (ii) at the
appropriate payment date, the amount of dividends or other
distributions with a record date after the Effective Time but prior to
surrender and a payment date subsequent to surrender payable with
respect to such whole shares of EQR Common, less the amount of any
withholding taxes which may be required thereon. Any distribution
payable with respect to Lexford Common with a record date prior to the
Effective Time which shall not have been paid as of the Effective Time
shall be paid to the holders entitled to such distribution whether or
not such holders have surrendered their Lexford Certificates in
accordance with the provisions hereof.
(d) At and after the Effective Time, there shall be no
transfers on the share transfer books of Lexford of the shares of
Lexford Common which were outstanding immediately
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prior to the Effective Time. If, after the Effective Time, Lexford
Certificates are presented to EQR, they shall be canceled and exchanged
for certificates evidencing EQR Common and cash in lieu of fractional
EQR Common, if any, and unpaid dividends and distributions deliverable
in respect thereof pursuant to these Articles in accordance with the
procedures set forth in this Section 10.
(e) Any portion of the EQR Certificates made available to
the Exchange Agent pursuant to Section 10(a) which remains unclaimed by
the holders of Lexford Common for one hundred twenty (120) days after
the Effective Time shall be delivered to EQR, upon demand of EQR, and
any former shareholders of Lexford who have not theretofore complied
with this Section 10 shall look only to EQR for payment of their EQR
Common, cash in lieu of fractional shares of EQR Common and unpaid
dividends and distributions on the EQR Common deliverable in respect of
each share of Lexford Common such shareholder holds as determined
pursuant to these Articles, in each case, without any interest thereon.
(f) None of Lexford, EQR, the Exchange Agent or any other
person shall be liable to any former holder of Lexford Common for any
amount properly delivered to a public official pursuant to applicable
abandoned property, escheat or similar laws.
(g) In the event any Lexford Certificate shall have been
lost, stolen or destroyed, upon the making of an affidavit of that fact
by the person claiming such certificate to be lost, stolen or destroyed
and, if required by EQR, the posting by such person of a bond in such
reasonable amount as EQR may direct as indemnity against any claim that
may be made against it with respect to such Lexford Certificate, the
Exchange Agent or EQR will issue in exchange for such lost, stolen or
destroyed Lexford Certificate the EQR Common and cash in lieu of
fractional EQR Common, and unpaid dividends and distributions on the
EQR Common as provided in Section 9(c), deliverable in respect thereof
pursuant to these Articles.
11. NOTICE. Any notice or other communication required or
permitted under these Articles shall be given, and shall be effective, in
accordance with the provisions of the Merger Agreement.
12. GOVERNING LAW. These Articles shall be governed by and
construed in accordance with the laws of the State of Maryland.
13. COUNTERPARTS. These Articles may be executed in multiple
counterparts, each of which shall be deemed an original and all of which
together shall constitute one agreement.
14. ABANDONMENT. The Merger may be abandoned before the Effective
Time by majority vote of the entire Board of Trustees of EQR and Board of
Trustees of Lexford.
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IN WITNESS WHEREOF, these Articles have been signed on this 1st day
of October, 1999 by the Vice President of EQR and the Senior Vice President
of Lexford, and each of the undersigned acknowledges these Articles to be the
act of the entity on whose behalf he or she has signed, and, as to all
matters or facts required to be verified under oath, each of the undersigned
acknowledges, that to the best of his or her knowledge, information and
belief, the matters and facts are true in all material respects and such
statement is made under the penalties for perjury.
EQUITY RESIDENTIAL PROPERTIES LEXFORD RESIDENTIAL TRUST
TRUST
By: /s/ Yasmina Rahal By: /s/ Ronald P. Koegler
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Its: Vice President Its: Senior Vice President
Attest: /s/ Lisa Currie Attest: /s/ Bradley A. Van Auken
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Assistant Secretary Secretary
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EXHIBIT A
AMENDMENT TO EQR DECLARATION
AMENDMENT TO THE SECOND AMENDED AND
RESTATED DECLARATION OF TRUST OF
EQUITY RESIDENTIAL PROPERTIES TRUST
THIS AMENDMENT TO THE SECOND AMENDED AND RESTATED DECLARATION OF
TRUST OF EQUITY RESIDENTIAL PROPERTIES TRUST is effective as of the Effective
Time.
AMENDMENT TO SECTION 8.2
Section 8.2 of the Declaration is hereby deleted in its entirety and
the following is hereby substituted in lieu thereof:
"Subject to the provisions of any class or series of Shares then
outstanding, the Shareholders shall be entitled to vote only on the
following matters: (a) the election or removal of Trustees; (b) the
amendment of this Declaration of Trust; (c) the voluntary dissolution
or termination of the Trust; (d) the merger of the Trust, PROVIDED,
HOWEVER, that the Shareholders shall not be entitled to vote on a
merger of the Trust which may be approved pursuant to the provisions of
Title 8 by a majority of the entire Board of Trustees without a vote of
the Shareholders and, FURTHER PROVIDED, that if a shareholder vote is
required pursuant to the provisions of Title 8, such merger shall be
approved by the affirmative vote of the holders of not less than a
majority of all the Shares then outstanding and entitled to vote
thereon, (e) the sale or other disposition of all or substantially all
of the Trust Property, PROVIDED, HOWEVER, that the sale or other
disposition of all or substantially all of the Trust Property shall be
approved by the affirmative vote of the holders of not less than a
majority of all the Shares then outstanding and entitled to vote
thereon, and (f) such other matters with respect to which the Board of
Trustees has adopted a resolution declaring advisable or recommending a
proposal and directing that the matter be submitted to the Shareholders
for consideration. Except with respect to the foregoing matters, no
action taken by the Shareholders at any meeting shall in any way bind
the Trustees.
Section 9.1(b) of the Declaration is hereby deleted in its entirety and
the following is hereby substituted in lieu thereof:
"Notwithstanding the provisions of Section 9.1(a) hereof and subject to
the provisions of any class or series of Shares then outstanding, this
Declaration of Trust may be
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amended pursuant to the terms of Articles of Merger accepted for record
by the SDAT relating to a merger of any entity or entities with the
Trust, provided that such merger shall have been approved by the
affirmative vote of not less than a majority of the Shares then
outstanding and entitled to vote thereon."
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