8-K

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): June 11, 2003

UNITED DOMINION REALTY TRUST, INC.

(Exact name of Registrant as specified in its charter)

Maryland	1-10524	54-0857512
(State or Other Jurisdiction of Incorporation)	(Commission File No.)	(IRS Employer Identification No.)

1745 Shea Center Drive, Suite 200, Highlands Ranch, Colorado 80129
(Address of principal executive offices)(Zip Code)

(720) 283-6120
(Registrant’s telephone number, including area code)

TABLE OF CONTENTS

	ITEM 5. Other Events
	ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits
Signatures
Exhibit Index
EX-2.01 Articles of Merger
EX-2.02 Articles of Merger
EX-3.02 Bylaws

ITEM 5. Other Events

     On June 11, 2003, United Dominion Realty Trust, Inc., a Virginia corporation, changed its state of incorporation from Virginia to Maryland by merging with and into its wholly owned subsidiary, UDRT Maryland, Inc., a Maryland corporation, with UDRT Maryland, Inc. surviving the merger (the “Reincorporation Merger”). The Reincorporation Merger was approved by the shareholders of United Dominion Realty Trust, Inc. at the company’s Annual Meeting of Shareholders held on May 6, 2003. In connection with the Reincorporation Merger, UDRT Maryland, Inc. changed its name to United Dominion Realty Trust, Inc. As the successor entity in the Reincorporation Merger, United Dominion Realty Trust, Inc., a Maryland corporation, hereby formally adopts the registration statements and all other filings of United Dominion Realty Trust, Inc., a Virginia corporation, filed with the Securities and Exchange Commission prior to the Reincorporation Merger. The Articles of Merger filed with the State Department of Assessments and Taxation of the State of Maryland are attached hereto as Exhibit 2.01. The Articles of Merger filed with the State Corporation Commission of the Commonwealth of Virginia are attached hereto as Exhibit 2.02. The Amended and Restated Articles of Incorporation of United Dominion Realty Trust, Inc., a Maryland corporation, are attached as Exhibit A to Exhibit 2.01 hereto and incorporated herein by reference. The Bylaws of United Dominion Realty Trust, Inc., a Maryland corporation, are attached hereto as Exhibit 3.02.

ITEM 7. Financial Statements, Pro Forma Financial Information and Exhibits

     (c)  Exhibits.

Exhibit No.	Description
2.01	Articles of Merger between UDRT Maryland, Inc., a Maryland corporation, and United Dominion Realty Trust, Inc., a Virginia corporation, filed with the State Department of Assessments and Taxation of the State of Maryland.
2.02	Articles of Merger between UDRT Maryland, Inc., a Maryland corporation, and United Dominion Realty Trust, Inc., a Virginia corporation, filed with the State Corporation Commission of the Commonwealth of Virginia.
3.01	Amended and Restated Articles of Incorporation of United Dominion Realty Trust, Inc., a Maryland corporation, (attached as Exhibit A to Exhibit 2.01 hereto and incorporated herein by reference).
3.02	Bylaws of United Dominion Realty Trust, Inc., a Maryland corporation.

Signatures

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	UNITED DOMINION REALTY TRUST, INC.
Date: June 11, 2003	By:	/s/ Mary Ellen Norwood
		Mary Ellen Norwood Vice President and Secretary

Exhibit Index

Exhibit No.	Description
2.01	Articles of Merger between UDRT Maryland, Inc., a Maryland corporation, and United Dominion Realty Trust, Inc., a Virginia corporation, filed with the State Department of Assessments and Taxation of the State of Maryland.
2.02	Articles of Merger between UDRT Maryland, Inc., a Maryland corporation, and United Dominion Realty Trust, Inc., a Virginia corporation, filed with the State Corporation Commission of the Commonwealth of Virginia.
3.01	Amended and Restated Articles of Incorporation of United Dominion Realty Trust, Inc., a Maryland corporation (attached as Exhibit A to Exhibit 2.01 hereto and incorporated herein by reference).
3.02	Bylaws of United Dominion Realty Trust, Inc., a Maryland corporation.

EX-2.01 3 d06673exv2w01.txt EX-2.01 ARTICLES OF MERGER Exhibit 2.01 ARTICLES OF MERGER OF United Dominion Realty Trust, Inc. AND UDRT Maryland, Inc. FIRST: United Dominion Realty Trust, Inc. ("Parent") and UDRT Maryland, Inc. ("Subsidiary"), being the corporations which are the parties to these Articles of Merger, do hereby agree to effect a merger of said corporations upon the terms and conditions herein set forth. SECOND: The Subsidiary is the corporation to survive the merger. Subsidiary is a corporation incorporated in the State of Maryland under the provisions of the State of Maryland General Corporation Law with its principal office in the State of Maryland located at 300 E. Lombard St., Baltimore, MD 21202, and which will continue its corporate existence pursuant to the provisions of the Maryland General Corporation Law. THIRD: The Parent is the corporation to be merged into the Subsidiary. Parent is a corporation incorporated in the Commonwealth of Virginia, which was incorporated under general law in said state on March 11, 1970 and the corporate existence of which will cease upon the effective date of the merger in accordance with the provisions of the general laws of the Commonwealth of Virginia. The Parent has no principal office in the State of Maryland. Parent owns interests in land in the following counties in the State of Maryland: Wicomico County Hartford County Howard County Anne Arundel County Talbot County Saint Mary's County Parent was qualified to conduct interstate and foreign business in the State of Maryland as a foreign corporation on December 9, 1992. FOURTH: In connection with the merger, the charter of the Subsidiary (the "Charter") is amended and restated as set forth on EXHIBIT A, attached hereto and incorporated herein, and the Charter, as amended, shall continue in full force and effect until duly amended in accordance with its terms and applicable law. FIFTH: In connection with the merger, the subsidiary hereby changes its name from UDRT Maryland, Inc. to United Dominion Realty Trust, Inc. SIXTH: Immediately prior to the merger, the total number of shares of stock of all classes which Parent has the authority to issue is 175,000,000 shares of stock, consisting of 150,000,000 shares of common stock, $1.00 par value per share, and 25,000,000 shares of preferred stock without par value. The aggregate par value of all authorized shares of stock of Parent having par value is currently $150,000,000. SEVENTH: Immediately prior to the merger, the total number of shares of stock of all classes which Subsidiary has authority to issue is 1,000 shares, par value $1.00 per share, all of one class. The aggregate par value of all classes of stock of Subsidiary having par value is $1,000. EIGHTH: The total number of shares of stock of all classes which Subsidiary has authority to issue immediately after the merger is 275,000,000 shares of stock, consisting of 250,000,000 shares of common stock, $1.00 par value per share, and 25,000,000 shares of preferred stock, without par value. The aggregate par value of all authorized shares of stock of Subsidiary having par value immediately after the merger is $250,000,000. NINTH: Upon the Effective Time (defined below), Parent shall be merged into Subsidiary. Thereupon, Subsidiary shall possess any and all purposes and powers of Parent; and all leases, licenses, property, rights, privileges, and powers of whatever nature and description of Parent shall be transferred to, vested in, and devolved upon Subsidiary, without further act or deed, subject to all of the debts and obligations of Parent. At the Effective Time, each share of stock of Subsidiary issued and outstanding immediately prior to the Effective Time shall be canceled and cease to exist and each share of stock of Parent issued and outstanding immediately prior to the Effective Time shall be converted into one share of stock of Subsidiary. TENTH: The terms and conditions of the merger herein set forth were advised, authorized, and approved by Subsidiary in the manner and by the vote required by its charter and the provisions of the Maryland General Corporation Law, and the said merger was approved in the manner hereinafter set forth. ELEVENTH: The merger was duly advised by the Board of Directors of Subsidiary in the following manner. Said Board of Directors of Subsidiary adopted a resolution declaring that the merger of Parent into Subsidiary is advisable substantially upon the terms and conditions set forth or referred to in said resolution and directed that the merger be submitted for consideration by the sole stockholder of Subsidiary. Said resolution of the Board of Directors of Subsidiary was adopted by a written consent signed on June 11, 2003 by the sole member of the Board of Directors of Subsidiary without a meeting. TWELFTH: The merger and the aforesaid terms and conditions were duly approved by the stockholders of Subsidiary in the following manner. Parent, the sole 2 stockholder of Subsidiary, by written consent, approved the merger described in these Articles of Merger on substantially the terms and conditions set forth herein. THIRTEENTH: The terms and conditions of the merger herein set forth were duly advised, authorized, and approved, with respect to Parent, in the manner and by the vote required by the charter of said corporation and by the laws of the Commonwealth of Virginia, which is the state of incorporation of said corporation, as follows: The Board of Directors of Parent, by resolution filed with the minutes of the proceedings of such Board of Directors, approved the merger described in these Articles of Merger on substantially the terms and conditions set forth herein. The holders of more than two-thirds of the outstanding stock of Parent entitled to vote on the merger approved the merger at a meeting duly called and held after at least 20 days' notice of the purpose of the meeting was mailed to each such shareholder at the shareholders address as it appears on the records of Parent. FOURTEENTH: These Articles of Merger shall become effective upon the date of filing with the State Department of Assessments and Taxation of the State of Maryland (the "Effective Time"). [Intentionally Blank] 3 IN WITNESS WHEREOF, these Articles of Merger are hereby signed for and on behalf of Parent by its Vice President and Secretary, who does hereby acknowledge that said Articles of Merger are the act of said corporation, and who does hereby state under the penalties for perjury that the matters and facts set forth therein with respect to authorization and approval of said merger are true in all material respects to the best of her knowledge, information, and belief; and these Articles of Merger are hereby signed for and on behalf of Subsidiary by its President, who does hereby acknowledge that said Articles of Merger are the act of said corporation, and who does hereby state under the penalties for perjury that the matters and facts stated therein with respect to authorization and approval of said merger are true in all material respects to the best of his knowledge, information, and belief. Executed on this 11th day of June, 2003. United Dominion Realty Trust, Inc. By:/s/ Mary Ellen Norwood ------------------------------------ Mary Ellen Norwood Vice President and Secretary Attest: June 11, 2003 /s/ Mary Ellen Norwood - --------------------------------- Mary Ellen Norwood Vice President and Secretary Executed on this 11th, day of June, 2003. UDRT Maryland, Inc. By:/s/ Warren L. Troupe ------------------------------------ Warren L. Troupe President Attest: June 11, 2003 /s/ Warren L. Troupe - --------------------------------- Warren L. Troupe Secretary EXHIBIT A AMENDED AND RESTATED ARTICLES OF INCORPORATION ARTICLE I INCORPORATOR The undersigned, Warren L. Troupe, whose address is c/o Morrison & Foerster LLP, 5200 Republic Plaza, 370 17th Street, Denver, Colorado 80202, being at least 18 years of age, does hereby form a Corporation under the general laws of the State of Maryland. ARTICLE II NAME The name of the Corporation is United Dominion Realty Trust, Inc. (the "Corporation"). ARTICLE III PURPOSES The purposes for which the Corporation is formed are to engage in any lawful act or activity (including, without limitation or obligation, engaging in business as a real estate investment trust under the Internal Revenue Code of 1986, as amended, or any successor statute (the "Code")) for which Corporations may be organized under the general laws of the State of Maryland as now or hereafter in force. For purposes of these Articles of Incorporation (this "Charter"), "REIT" means a real estate investment trust under Section 856 of the Code. ARTICLE IV PRINCIPAL OFFICE IN STATE AND RESIDENT AGENT The address of the principal office of the Corporation in the State of Maryland is 300 E. Lombard Street, Baltimore, Maryland 21202. The name and address of the resident agent of the Corporation in the State of Maryland is The Corporation Trust Incorporated, a Maryland Corporation, 300 E. Lombard Street, Baltimore, Maryland 21202. The Corporation may have such other offices and places of business within or outside the State of Maryland as the Corporation may from time to time determine. ARTICLE V STOCK Section 5.1 Authorized Shares. The Corporation shall have authority to issue 250,000,000 shares of Common Stock having a par value of $1.00 per share ("Common Stock") and 25,000,000 shares of preferred stock without par value ("Preferred Stock"). The aggregate par value of all authorized shares of stock having par value is $250,000,000. If shares of one class of stock are classified or reclassified into shares of another class of stock pursuant to Section 5.2(b) or Section 5.3, the number of authorized shares of the former class shall be automatically decreased and the number of shares of the latter class shall be automatically increased, in each case by the number of shares so classified or reclassified, as the case may be, so that the aggregate number of shares of all classes that the Corporation has authority to issue shall not be more than the total number of shares set forth in the first sentence of this Article V. To the extent permitted by Maryland law, the Board of Directors ("Board"), with the approval of a majority of the entire Board and without any action by the stockholders, may amend this Charter from time to time to (a) increase or decrease the aggregate number of shares of stock of the Corporation, (b) increase or 1 decrease the number of shares of any class or series that the Corporation has authority to issue, or (c) classify or reclassify any unissued shares by setting or changing the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends, qualifications or terms and conditions of redemption of such shares. Section 5.2 Common Stock. (a) Common Stock Subject to Terms of Preferred Stock. The Common Stock shall be subject to the express terms of any series of Preferred Stock. (b) Description. Each share of Common Stock shall entitle the holder thereof to one (1) vote per share on all matters upon which stockholders are entitled to vote. Shares of a particular class of Common Stock shall have equal dividend, distribution, liquidation and other rights, and shall have no preference, cumulative, preemptive, conversion or exchange rights except as otherwise set forth herein. The Board may classify or reclassify any unissued Common Stock from time to time in one or more classes or series of stock. (c) Dividend or Distribution Rights. The Board from time to time may authorize and the Corporation may pay to stockholders such dividends or other distributions in cash or other property as the Board in its discretion may determine. The Board shall endeavor to authorize, and the Corporation may pay, such dividends and distributions as are necessary for the Corporation to qualify as a REIT under the Code; provided, however, stockholders shall have no right to any dividend or distribution unless and until authorized by the Board and declared by the Corporation. The exercise of the powers and rights of the Board pursuant to this Section 5.2 is subject to the provisions of any class or series of shares at the time outstanding. The receipt by any person in whose name any shares are registered on the records of the Corporation or by his or her duly authorized agent shall be a sufficient discharge for all dividends or distributions payable or deliverable in respect of such shares and from all liability to see to the application thereof. (d) Rights Upon Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up, or any distribution of the assets of the Corporation, the aggregate assets available for distribution to holders of the Common Stock shall be determined in accordance with applicable law and the terms of this Charter. Each holder of Common Stock shall be entitled to receive, ratably with each other holder of Common Stock, that portion of such aggregate assets available for distribution as the number of outstanding shares of Common Stock held by such holder bears to the total number of shares of Common Stock then outstanding. (e) Voting Rights. Except as may be provided otherwise in this Charter, and subject to the express terms of any series of Preferred Stock, the holders of the Common Stock shall have the exclusive right to vote on all matters (as to which a holder of Common Stock is entitled to vote pursuant to applicable law) at all meetings of the stockholders of the Corporation. Section 5.3 Preferred Stock. The Board is hereby expressly granted the authority to authorize from time to time the issuance of one or more series of Preferred Stock. Prior to the issuance of each such class or series, the Board, by resolution, shall fix the number of shares to be included in each series, and the designation, preferences, terms, rights, restrictions, limitations, qualifications and terms and conditions of redemption of the shares of each class or series, if any. The authority of the Board with respect to each series shall include, but not be limited to, determination of the following: (a) The designation of the series, which may be by distinguishing number, letter or title. 2 (b) The dividend rate on the shares of the series, if any, whether any dividends shall be cumulative and, if so, from which date or dates, and the relative rights of priority, if any, of payment of dividends on shares of the series. (c) The redemption rights, including conditions and the price or prices, if any, for shares of the series. (d) The terms and amounts of any sinking fund for the purchase or redemption of shares of the series. (e) The rights of the shares of the series in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Corporation, and the relative rights of priority, if any, of payment of shares of the series. (f) Whether the shares of the series are convertible into shares of any other class or series or any other security of the Corporation or any other corporation or other entity, and, if so, the specification of such other class or series of such other security, the conversion price or prices or rate or rates, any adjustments thereof, the date or dates on which such shares will be convertible and all other terms and conditions upon which such conversion may be made. (g) Restrictions on the issuance of shares of the same series or of any other class or series. (h) The voting rights of the holders of shares of the series subject to the limitations contained in this Section 5.3. (i) Any other relative rights, preferences and limitations on that series, subject to the express provisions of any other series of Preferred Stock then outstanding. Notwithstanding any other provision of this Charter, the Board may increase or decrease (but not below the number of shares of such series then outstanding) the number of shares, or alter the designation or classify or reclassify any unissued shares of a particular series of Preferred Stock, by fixing or altering, in one or more respects, from time to time before issuing the shares, the terms, rights, restrictions and qualifications of the shares of any such series of Preferred Stock. Section 5.4 Series of Preferred Stock Authorized. (a) 8.60% Series B Cumulative Redeemable Preferred Stock. (i) Designation and Number. A series of the preferred stock, designated the "8.60% Series B Cumulative Redeemable Preferred Stock" (the "Series B Preferred"), is hereby established. The number of shares of the Series B Preferred shall be 6,000,000. (ii) Relative Seniority. In respect of rights to receive dividends and to participate in distributions or payments in the event of any liquidation, dissolution or winding up of the Corporation, the Series B Preferred shall rank senior to the Common Stock and any other capital stock of the Corporation ranking, as to dividends and upon liquidation, junior to the Series B Preferred (collectively, for purposes of this Section 5.4(a), "Junior Stock"). (iii) Dividends. The holders of the then outstanding Series B Preferred shall be entitled to receive, when and as declared by the Board out of any funds legally available therefor, 3 cumulative preferential cash dividends at the rate of 8.60% of the liquidation preference of the Series B Preferred (equivalent to $2.15 per share) per annum, payable quarterly in arrears in cash on the last day, or the next succeeding business day, of February, May, August and November in each year, beginning August 31, 1997 (each such day being hereinafter called a "Dividend Payment Date" and each period beginning on the day next following a Dividend Payment Date and ending on the next following Dividend Payment Date being hereinafter called a "Dividend Period"), to stockholders of record at the close of business on the fifteenth day of the calendar month in which the applicable Dividend Payment Date falls on or such date as shall be fixed by the Board at the time of declaration of the dividend (the "Dividend Record Date"), which shall be not less than 10 nor more than 30 days preceding the Dividend Payment Date. The amount of any dividend payable for the initial Dividend Period and for any partial Dividend Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends on the shares of Series B Preferred shall accrue and be cumulative from and including the date of original issue thereof, whether or not (A) the Corporation has earnings, (B) dividends on such shares are declared or (C) on any Dividend Payment Date there shall be funds legally available for the payment of such dividends. When dividends are not paid in full upon the shares of Series B Preferred and the shares of any other series of preferred stock ranking on a parity as to dividends with the Series B Preferred (or a sum sufficient for such full payment is not set apart therefor), all dividends declared upon shares of Series B Preferred and any other series of preferred stock ranking on a parity as to dividends with the Series B Preferred shall be declared pro rata so that the amount of dividends declared per share on the Series B Preferred and such other series of preferred stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of Series B Preferred and such other series of preferred stock bear to each other. Except as provided in the immediately preceding paragraph, unless full cumulative dividends on the Series B Preferred have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment on the Series B Preferred for all past dividend periods and the then current dividend period, (i) no dividends shall be declared or paid or set apart for payment on the preferred stock of the Corporation ranking, as to dividends, on a parity with or junior to the Series B Preferred for any period, and (ii) no dividends (other than in Junior Stock) shall be declared or paid or set aside for payment or other distribution or shall be declared or made upon the Junior Stock or any other capital stock of the Corporation ranking on a parity with the Series B Preferred as to dividends or upon liquidation (for purposes of this Section 5.4(a), "Parity Stock"), nor shall any Junior Stock or any Parity Stock be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of Junior Stock or Parity Stock) by the Corporation (except by conversion into or exchange for Junior Stock). Any dividend payment made on shares of the Series B Preferred shall first be credited against the earliest accrued but unpaid dividend due with respect to such shares which remains payable. No dividends on shares of Series B Preferred shall be declared by the Board or paid or set apart for payment by the Corporation at such time as the terms and provisions of any agreement of the Corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law. The amount of any dividends accrued on any shares of Series B Preferred at any Dividend Payment Date shall be the amount of any unpaid dividends accumulated thereon, to and including such Dividend Payment Date, whether or not earned or declared, and the amount of dividends accrued on any shares of Series B Preferred at any date other than a Dividend Payment Date shall be 4 equal to the sum of the amount of any unpaid dividends accumulated thereon, to and including the last preceding Dividend Payment Date, whether or not earned or declared, plus an amount calculated on the basis of the annual dividend rate for the period after such last preceding Dividend Payment Date to and including the date as of which the calculation is made, based on a 360-day year of twelve 30-day months. Accrued but unpaid dividends on the Series B Preferred will not bear interest. Holders of the Series B Preferred will not be entitled to any dividends in excess of full cumulative dividends as described above. Except as provided in this Charter, the Series B Preferred shall not be entitled to participate in the earnings or assets of the Corporation. (iv) Liquidation Rights. (A) Upon the voluntary or involuntary dissolution, liquidation or winding up of the Corporation, the holders of shares of the Series B Preferred then outstanding shall be entitled to receive and to be paid out of the assets of the Corporation legally available for distribution to its stockholders, before any distribution shall be made to the holders of Common Stock or any other capital stock of the Corporation ranking junior to the Series B Preferred upon liquidation, a liquidation preference of $25.00 per share, plus accrued and unpaid dividends thereon to the date of payment. (B) After the payment to the holders of the shares of the Series B Preferred of the full liquidation preference provided for in this paragraph (iv), the holders of the Series B Preferred as such shall have no right or claim to any of the remaining assets of the Corporation. (C) If, upon any voluntary or involuntary dissolution, liquidation or winding up of the Corporation, the amounts payable with respect to the liquidation preference of the shares of the Series B Preferred and any other shares of stock of the Corporation ranking as to any such distribution on a parity with the shares of the Series B Preferred are not paid in full, the holders of the shares of the Series B Preferred and of such other shares will share ratably in any such distribution of assets of the Corporation in proportion to the full respective liquidation preferences to which they are entitled. (D) Neither the sale, lease, transfer or conveyance of all or substantially all the property or business of the Corporation, nor the merger or consolidation of the Corporation into or with any other Corporation or the merger or consolidation of any other Corporation into or with the Corporation, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (iv). (v) Redemption. (A) Right of Optional Redemption. The Series B Preferred is not redeemable prior to May 29, 2007. On and after May 29, 2007, the Corporation may, at its option, redeem at any time all or, from time to time, part of the Series B Preferred at a price per share (the "Series B Redemption Price"), payable in cash, of $25.00, together with all accrued and unpaid dividends to and including the date fixed for redemption (the "Series B Redemption Date"), without interest. In case of redemption of less than all shares of Series B Preferred at the time outstanding, the shares of Series B Preferred to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of shares of Series B Preferred held by such holders (as nearly as may be 5 practicable without creating fractional shares) or by any other equitable method determined by the Corporation. (B) Procedures for Redemption. (1) Notice of any redemption will be (a) given by publication in a newspaper of general circulation in the City of New York, New York, such publication to be made once a week for two successive weeks commencing not less than 30 nor more than 60 days prior to the Series B Redemption Date, and (b) mailed by the Corporation, postage prepaid, not less than 30 nor more than 60 days prior to the Series B Redemption Date, addressed to the respective holders of record of the Series B Preferred to be redeemed at their respective addresses as they appear on the stock transfer records of the Corporation. No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series B Preferred except as to the holder to whom the Corporation has failed to give notice or except as to the holder to whom notice was defective. In addition to any information required by law or by the applicable rules of any exchange upon which Series B Preferred may be listed or admitted to trading, such notice shall state: (a) the Series B Redemption Date; (b) the Series B Redemption Price; (c) the number of shares of Series B Preferred to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series B Redemption Price; and (e) that dividends on the shares to be redeemed will cease to accumulate on the Series B Redemption Date. If less than all the shares of Series B Preferred held by any holder are to be redeemed, the notice mailed to such holder shall also specify the number of shares of Series B Preferred held by such holder to be redeemed. (2) If notice of redemption of any shares of Series B Preferred has been published and mailed in accordance with subparagraph (v)(B)(1) above and provided that on or before the Series B Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Corporation, separate and apart from its other funds in trust for the benefit of any holders of the shares of Series B Preferred so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series B Redemption Date, dividends on such shares of Series B Preferred shall cease to accrue, and such shares shall no longer be deemed to be outstanding and shall not have the status of Series B Preferred and all rights of the holders thereof as stockholders of the Corporation (except the right to receive the Series B Redemption Price) shall terminate. Upon surrender, in accordance with said notice, of the certificates for any shares of Series B Preferred so redeemed (properly endorsed or assigned for transfer, if the Corporation shall so require and the notice shall so state), such shares of Series B Preferred shall be redeemed by the Corporation at the Series B Redemption Price. In case less than all the shares of Series B Preferred represented by any such certificate are redeemed, a new certificate or certificates shall be issued representing the unredeemed shares of Series B Preferred without cost to the holder thereof. (3) The deposit of funds with a bank or trust company for the purpose of redeeming Series B Preferred shall be irrevocable except that: (a) the Corporation shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and (b) any balance of moneys so deposited by the Corporation and unclaimed by the holders of the Series B Preferred entitled thereto at the expiration of two years from the applicable Series B Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Corporation, and after any such repayment, the holders of the shares 6 entitled to the funds so repaid to the Corporation shall look only to the Corporation for payment without interest or other earnings. (C) Limitations on Redemption. (1) The Series B Redemption Price (other than the portion thereof consisting of accrued and unpaid dividends) shall be payable solely out of the sale proceeds of other capital stock of the Corporation and from no other source. (2) Unless full cumulative dividends on all shares of Series B Preferred shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Dividend Periods and the then current Dividend Period, no Series B Preferred shall be redeemed (unless all outstanding shares of Series B Preferred are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly (except by exchange for Junior Stock); provided, however, that the foregoing shall not prevent the exchange of Series B Preferred pursuant to Article VI or the purchase or acquisition of Series B Preferred pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series B Preferred. (D) Rights to Dividends on shares Called for Redemption. If the Series B Redemption Date is after a Dividend Record Date and before the related Dividend Payment Date, the dividend payable on such Dividend Payment Date shall be paid to the holder in whose name the shares of Series B Preferred to be redeemed are registered at the close of business on such Dividend Record Date notwithstanding the redemption thereof between such Dividend Record Date and the related Dividend Payment Date or the Corporation's default in the payment of the dividend due. Except as provided in this paragraph (v), the Corporation will make no payment or allowance for unpaid dividends, whether or not in arrears, on called Series B Preferred. (vi) Voting Rights. Except as required by the general laws of the State of Maryland and except as otherwise provided in this paragraph (vi), the holders of the Series B Preferred shall not be entitled to vote at any meeting of the stockholders for election of directors or for any other purpose or otherwise to participate in any action taken by the Corporation or the stockholders thereof, or to receive notice of any meeting of stockholders. (A) Whenever dividends on any shares of Series B Preferred shall be in arrears for six or more consecutive quarterly periods, the holders of such shares of Series B Preferred (voting separately as a class with all other series of preferred stock upon which like voting rights have been conferred and are exercisable) will be entitled to vote for the election of two additional directors of the Corporation at a special meeting called by the holders of record of at least 10% of the Series B Preferred or the holders of any other series of preferred stock so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders) or at the next annual meeting of stockholders, and at each subsequent annual meeting until all dividends accumulated on such shares of Series B Preferred for the past Dividend Periods and the then current Dividend Period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment. In such case, the entire Board will be increased by two directors. (B) So long as any shares of Series B Preferred remain outstanding, the Corporation shall not, without the affirmative vote of the holders of at least a majority of the shares of the Series B Preferred outstanding at the time, (1) authorize or create, or increase the authorized or issued amount of, any class or series of capital stock ranking prior to the Series B Preferred with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding 7 up or reclassify any authorized capital stock of the Corporation into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (2) amend, alter or repeal the provisions of this Charter, whether by merger, consolidation or otherwise, so as to materially and adversely affect any right, preference, privilege or voting power of the Series B Preferred or the holders thereof; provided, however, that any increase in the amount of the authorized preferred stock or the creation or issuance of any other series of preferred stock, or any increase in the amount of authorized shares of such series, in each case ranking on a parity with or junior to the Series B Preferred with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers. (C) The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series B Preferred shall have been redeemed or called for redemption upon proper notice and sufficient funds shall have been deposited in trust to effect such redemption. (D) So long as the Series B Preferred is listed or admitted to trading on The New York Stock Exchange, then notwithstanding anything to the contrary in this Charter, including without limitation Article VIII, approval by the holders of at least two-thirds of the outstanding shares of the Series B Preferred shall be required for adoption of any amendment of this Charter or of the Bylaws of the Corporation that would materially affect the existing terms of the Series B Preferred. (vii) Conversion of Series B Preferred. The Series B Preferred is not convertible into or exchangeable for any other property or securities of the Corporation except as provided in Article VI. (b) Series C Junior Participating Redeemable Preferred Stock. (i) Designation and Number. A series of the preferred stock, designated the "Series C Junior Participating Cumulative Redeemable Preferred Stock" (the "Series C Preferred"), is hereby established. The number of shares of the Series C Preferred shall be 1,000,000. (ii) Relative Seniority. In respect of rights to receive dividends and to participate in distributions or payments in the event of any liquidation, dissolution or winding up of the Corporation, the Series C Preferred shall rank junior to the Series B Preferred and (notwithstanding anything to the contrary in Section 5.4(c)(ii)) the Series D Preferred, and senior to the Common Stock and any other capital stock of the Corporation ranking, as to dividends and upon liquidation, junior to the Series C Preferred (collectively, for purposes of this Section 5.4(b), "Junior Stock"). (iii) Dividends. The holders of the then outstanding Series C Preferred shall be entitled to receive, when and as declared by the Board out of any funds legally available therefor, cumulative preferential cash dividends payable quarterly on March 31, June 30, September 30 and December 31 (each such date being referred to herein as a "Quarterly Dividend Payment Date" and each period beginning on the day next following a Quarterly Dividend Payment Date and ending on the next following Quarterly Dividend Payment Date being referred to herein as a "Dividend Period"), commencing on the first Quarterly Dividend Payment Date after the first issuance of a share or fraction of a share of Series C Preferred, in an amount per share (rounded to the nearest cent) equal to the greater of (A) $.01 or (B) subject to adjustment hereinafter set forth, 1,000 times the aggregate per share amount of all cash dividends, and 1,000 times the aggregate per share amount (payable in kind) of all non-cash dividends or other distributions (other than dividends payable in shares of Common Stock, as constituted on the date of such payment), declared on the Common Stock since the immediately preceding Quarterly 8 Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment Date, since the first issuance of any share or fraction of a share of Series C Preferred. In the event the Corporation shall at any time after February 4, 1998 (the "Rights Dividend Declaration Date"), (A) declare any dividend on the Common Stock payable in shares of Common Stock, (B) subdivide the outstanding Common Stock, or (C) combine the outstanding shares of Common Stock into a smaller number of shares, then in each such case the amount to which holders of shares of the Series C Preferred were entitled immediately prior to such event under clause (B) of the preceding paragraph shall be adjusted by multiplying such amount by a fraction (the "Adjustment Factor"), the numerator of which is the number of shares of Common Stock outstanding immediately after such event and the denominator of which is the number of shares of Common Stock outstanding immediately prior to such event. The Corporation shall declare a dividend or distribution on the Series C Preferred immediately after it declares a dividend or distribution on the Common Stock (other than a dividend payable in shares of Common Stock); provided that, in the event no dividend or distribution shall have been declared on the Common Stock during the period between any Quarterly Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a dividend at the rate of $.01 per share on the Series C Preferred shall nevertheless be declared payable on such subsequent Quarterly Dividend Payment Date. Dividends on the shares of Series C Preferred shall accrue and be cumulative from and including the Quarterly Dividend Payment Date next preceding the date of issue of such shares of Series C Preferred, unless the date of issue of such shares is prior to the record date for the first Quarterly Dividend Payment Date, in which event dividends on such shares shall accrue and be cumulative from and including the date of issue of such shares, or unless the date of issue is a Quarterly Dividend Payment Date or is a date after the record date for the determination of holders of shares of Series C Preferred entitled to receive a quarterly dividend and before such Quarterly Dividend Payment Date, in either of which events such dividends shall accrue and be cumulative from and including such Quarterly Dividend Payment Date, whether or not (A) the Corporation has earnings, (B) dividends on such shares are declared or (C) on any Quarterly Dividend Payment Date there shall be funds legally available for the payment of such dividends. When dividends are not paid in full upon the shares of Series C Preferred and the shares of any other series of preferred stock ranking on a parity as to dividends with the Series C Preferred (or a sum sufficient for such full payment is not set apart therefor), all dividends declared upon shares of Series C Preferred and any other series of preferred stock ranking on a parity as to dividends with the Series C Preferred shall be declared pro rata so that the amount of dividends declared per share on the Series C Preferred and such other series of preferred stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of Series C Preferred and such other series of preferred stock bear to each other. Except as provided in the immediately preceding paragraph, unless full cumulative dividends on the Series C Preferred have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment on the Series C Preferred for all past dividend periods and the then current dividend period, (A) no dividends shall be declared or paid or set apart for payment on the preferred stock of the Corporation ranking, as to dividends, on a parity with or junior to the Series C Preferred for any period, and (B) no dividends (other than in Junior Stock) shall be declared or paid or set aside for payment or other distribution or shall be declared or made upon the Junior Stock or any other capital stock of the Corporation ranking on a parity with the Series C Preferred as to dividends or upon liquidation (for purposes of this Section 5.4(b), "Parity Stock"), nor shall any Junior Stock or any Parity Stock be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any 9 shares of Junior Stock or Parity Stock) by the Corporation (except by conversion into or exchange for Junior Stock). Any dividend payment made on shares of the Series C Preferred shall first be credited against the earliest accrued but unpaid dividend due with respect to such shares which remains payable. No dividends on shares of Series C Preferred shall be declared by the Board or paid or set apart for payment by the Corporation at such time as the terms and provisions of any agreement of the Corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law. Accrued but unpaid dividends on the Series C Preferred will not bear interest. Holders of the Series C Preferred will not be entitled to any dividends in excess of full cumulative dividends as described above. Except as provided in this Charter, the Series C Preferred shall not be entitled to participate in the earnings or assets of the Corporation. The Board may fix a record date for the determination of holders of shares of Series C Preferred entitled to receive payment of a dividend or distribution declared thereon, which record date shall be no more than 30 days prior to the date fixed for the payment thereof. (iv) Liquidation Rights. (A) Upon the voluntary or involuntary dissolution, liquidation or winding up of the Corporation, the holders of shares of the Series C Preferred then outstanding shall be entitled to receive and to be paid out of the assets of the Corporation legally available for distribution to its stockholders, before any distribution shall be made to the holders of Common Stock or any other capital stock of the Corporation ranking junior to the Series C Preferred upon liquidation, a liquidation preference of $1,000.00 per share, plus accrued and unpaid dividends thereon to the date of payment (the "Series C Preferred Liquidation Preference"). (B) After the payment to the holders of the shares of the Series C Preferred of the full Series C Preferred Liquidation Preference, the holders of the Series C Preferred as such shall have no right or claim to any of the remaining assets of the Corporation until the holders of Common Stock shall have received an amount per share (the "Common Adjustment") equal to the quotient obtained by dividing (1) the Series C Preferred Liquidation Preference by (2) 1,000 (as appropriately adjusted as set forth in paragraph (D) below to reflect such events as stock splits, stock dividends and recapitalizations with respect to the Common Stock) (the number determined pursuant to clause (2) being hereinafter referred to as the "Adjustment Number"). Following the payment of the full amount of the Series C Preferred Liquidation Preference in respect of all outstanding shares of Series C Preferred, the full amount of any liquidation preference payable to holders of any other shares of stock of the Corporation ranking as to any distribution upon any voluntary or involuntary dissolution, liquidation or winding up of the Corporation on a parity with the shares of the Series C Preferred and the full amount of the Common Adjustment, respectively, holders of shares of Series C Preferred, holders of such other shares and holders of shares of Common Stock shall receive their ratable and proportionate share of the remaining assets to be distributed in the ratio of the Adjustment Number to 1 with respect to such shares of Series C Preferred, such other shares and shares of Common Stock, on a per share basis, respectively. 10 (C) If, upon any voluntary or involuntary dissolution, liquidation or winding up of the Corporation, the amounts payable with respect to the Series C Preferred Liquidation Preference and the liquidation preference of any other shares of stock of the Corporation ranking as to any such distribution on a parity with the shares of the Series C Preferred are not paid in full, the holders of the shares of the Series C Preferred and of such other shares will share ratably in any such distribution of assets of the Corporation in proportion to the full respective liquidation preferences to which they are entitled. In the event, however, that there are not sufficient assets available after payment in full of the Series C Preferred Liquidation Preference and such other liquidation preferences to permit payment in full of the Common Adjustment, then the remaining assets shall be distributed ratably to the holders of the Common Stock. (D) In the event the Corporation shall at any time after the Rights Dividend Declaration Date (1) declare any dividend on the Common Stock payable in shares of Common Stock, (2) subdivide the outstanding Common Stock, or (3) combine the outstanding shares of Common Stock into a smaller number of shares, then in each such case the Adjustment Number in effect immediately prior to such event shall be adjusted by multiplying such Adjustment Number by the Adjustment Factor. (E) Neither the sale, lease, transfer or conveyance of all or substantially all the property or business of the Corporation, nor the merger or consolidation of the Corporation into or with any other Corporation or the merger or consolidation of any other Corporation into or with the Corporation, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (iv). (v) Redemption. (A) Right of Optional Redemption. The outstanding shares of Series C Preferred may be redeemed at the option of the Board as a whole, but not in part, at any time, or from time to time, at a price per share (the "Series C Redemption Price") equal to (1) 100% of the product of the Adjustment Number times the Average Market Value (as such term is hereinafter defined) of the Common Stock, plus (2) all accrued and unpaid dividends to and including the date fixed for redemption (the "Series C Redemption Date"). The "Average Market Value" is the average of the closing sale prices of a share of the Common Stock during the 30-day period immediately preceding the date before the redemption date quoted on the Composite Tape for New York Stock Exchange Listed Stocks, or, if the Common Stock is not quoted on the Composite Tape, on The New York Stock Exchange, or, if the Common Stock is not listed on such exchange, on the principal United States securities exchange registered under the Securities Exchange Act of 1934, as amended, on which the Common Stock is listed, or, if the Common Stock is not listed on any such exchange, the average of the closing bid quotations with respect to a share of Common Stock during such 30-day period on The NASDAQ Stock Market, or if no such quotations are available, the fair market value of a share of Common Stock as determined by the Board in good faith. (B) Procedures for Redemption. (1) Notice of any redemption will be (a) given by publication in a newspaper of general circulation in the City of New York, New York, such publication to be made once a week for two successive weeks commencing not less than 30 nor more than 60 days prior to the Series C Redemption Date, and (b) mailed by the Corporation, postage prepaid, not less than 30 nor more than 60 days prior to the Series C Redemption Date, addressed to the respective holders of record of the Series C Preferred to be redeemed at their respective addresses as they appear on the stock transfer records of the Corporation. No failure to give such notice or any defect therein or in the mailing thereof 11 shall affect the validity of the proceedings for the redemption of any Series C Preferred except as to the holder to whom the Corporation has failed to give notice or except as to the holder to whom notice was defective. In addition to any information required by law or by the applicable rules of any exchange upon which Series C Preferred may be listed or admitted to trading, such notice shall state: (a) the Series C Redemption Date; (b) the Series C Redemption Price; (c) the place or places where certificates for Series C Preferred are to be surrendered for payment of the Series C Redemption Price; and (d) that dividends on the Series C Preferred will cease to accumulate on the Series C Redemption Date. (2) If notice of redemption of the Series C Preferred has been published and mailed in accordance with subparagraph (v)(B)(1) above and provided that on or before the Series C Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Corporation, separate and apart from its other funds in trust for the benefit of the holders of the Series C Preferred, so as to be, and to continue to be available therefor, then, from and after the Series C Redemption Date, dividends on the Series C Preferred shall cease to accrue, and the Series C Preferred shall no longer be deemed to be outstanding and all rights of the holders thereof as stockholders of the Corporation (except the right to receive the Series C Redemption Price) shall terminate. Upon surrender, in accordance with said notice, of the certificates for the Series C Preferred (properly endorsed or assigned for transfer, if the Corporation shall so require and the notice shall so state), the Series C Preferred shall be redeemed by the Corporation at the Series C Redemption Price. (3) The deposit of funds with a bank or trust company for the purpose of redeeming Series C Preferred shall be irrevocable except that: (a) the Corporation shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and (b) any balance of moneys so deposited by the Corporation and unclaimed by the holders of the Series C Preferred entitled thereto at the expiration of two years from the applicable Series C Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Corporation, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Corporation shall look only to the Corporation for payment without interest or other earnings. (C) Rights to Dividends on Shares Called for Redemption. If the Series C Redemption Date is after a record date for payment of dividends on the Series C Preferred and before the related Quarterly Dividend Payment Date, the dividend payable on such Quarterly Dividend Payment Date shall be paid to the holders in whose name the shares of Series C Preferred are registered at the close of business on such record date notwithstanding the redemption thereof between such record date and the related Quarterly Dividend Payment Date or the Corporation's default in the payment of the dividend due. Except as provided in this paragraph (v), the Corporation will make no payment or allowance for unpaid dividends, whether or not in arrears, on called Series C Preferred. (vi) Voting Rights. (A) Subject to the provision for adjustment hereinafter set forth, each share of Series C Preferred shall entitle the holder thereof to 1,000 votes on all matters submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at any time after the Rights Declaration Date (1) declare any dividend on the Common Stock payable in shares of Common Stock, (2) subdivide the outstanding Common Stock, or (3) combine the outstanding shares of 12 Common Stock into a smaller number of shares, then in each such case the number of votes per share to which holders of shares of Series C Preferred were entitled immediately prior to such event shall be adjusted by multiplying such number by the Adjustment Factor. Except as otherwise provided herein or under applicable law, the holders of shares of Series C Preferred and the holders of shares of Common Stock shall vote together as one voting group on all matters submitted to a vote of stockholders of the Corporation. (B) Whenever dividends on any shares of Series C Preferred shall be in arrears for six or more consecutive quarterly periods, the holders of such shares of Series C Preferred (voting separately as a class with all other series of preferred stock upon which like voting rights have been conferred and are exercisable) will be entitled to vote for the election of two additional directors of the Corporation at a special meeting called by the holders of record of at least 10% of the Series C Preferred or the holders of any other series of preferred stock so in arrears (unless such request is received less than 90 days before the date fixed for the next annual or special meeting of the stockholders) or at the next annual meeting of stockholders, and at each subsequent annual meeting until all dividends accumulated on such shares of Series C Preferred for the past Dividend Periods and the then current Dividend Period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment. In such case, the entire Board will be increased by two directors. (C) The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series C Preferred shall have been redeemed or called for redemption upon proper notice and sufficient funds shall have been deposited in trust to effect such redemption. (D) In the event that the Series C Preferred is listed or admitted to trading on The New York Stock Exchange, then notwithstanding anything to the contrary in this Charter, including without limitation Article VIII, approval by the holders of at least two-thirds of the outstanding shares of the Series C Preferred shall be required for adoption of any amendment of this Charter or of the Bylaws of the Corporation that would materially affect the existing terms of the Series C Preferred. (vii) Conversion of Series C Preferred. The Series C Preferred is not convertible into or exchangeable for any other property or securities of the Corporation except as provided in Article VI. (viii) Consolidation, Merger, Share Exchange, etc. In case the Corporation shall enter into any consolidation, merger, share exchange, combination or other transaction in which the shares of Common Stock are exchanged for or changed into other stock or securities, cash and/or any other property, then in any such case the shares of Series C Preferred shall at the same time be similarly exchanged or changed in an amount per share (subject to the provision for adjustment hereinafter set forth) equal to 1,000 times the aggregate amount of stock, securities, cash and/or any other property (payable in kind), as the case may be, into which or for which each share of Common Stock is changed or exchanged. In the event the Corporation shall at any time after the Rights Dividend Declaration Date (A) declare any dividend on the Common Stock payable in shares of Common Stock, (B) subdivide the outstanding Common Stock, or (C) combine the outstanding shares of Common Stock into a smaller number of shares, then in each such case the amount set forth in the preceding sentence with respect to the exchange or change of shares of Series C Preferred shall be adjusted by multiplying such amount by the Adjustment Factor. (ix) Fractional Shares. Series C Preferred may be issued in fractions of one one-thousandth of a share (and integral multiples thereof) which shall entitle the holder, in proportion to 13 such holders' fractional shares, to exercise voting rights, receive dividends, participate in distributions and to have the benefit of all other rights of holders of Series C Preferred. (c) Series D Cumulative Convertible Preferred Stock. (i) Designation and Number. A series of the preferred stock, designated the "Series D Cumulative Convertible Redeemable Preferred Stock" (the "Series D Preferred"), is hereby established. The number of shares of the Series D Preferred shall be 8,000,000. (ii) Relative Seniority. In respect of rights to receive dividends and to participate in distributions or payments in the event of any liquidation, dissolution or winding up of the Corporation, the Series D Preferred shall rank on a parity with the Series B Preferred and the Series C Preferred and any other class or series of capital stock of the Corporation not constituting Junior Stock (collectively, for purposes of this Section 5.4(c), "Parity Stock"), and senior to the Common Stock and any other class or series of capital stock of the Corporation ranking, as to dividends and upon liquidation, junior to the Series D Preferred (collectively, for purposes of this Section 5.4(c), "Junior Stock"). (iii) Dividends. (A) The holders of the then outstanding Series D Preferred shall be entitled to receive, when and as declared by the Board of any funds legally available therefor, cumulative preferential cash dividends at the rate of 7.5% of the Liquidation Preference of the Series D Preferred (equivalent to $1.875 per share) per annum (subject to adjustment as provided in subparagraph (F) of this paragraph (iii)), payable quarterly in arrears in cash on the last day, or the next succeeding Business Day, of January, April, July and October in each year, beginning February 1, 1999 (each such day being hereinafter called a "Dividend Payment Date" and each period beginning on the day next following a Dividend Payment Date and ending on the next following Dividend Payment Date being hereinafter called a "Dividend Period"), to stockholders of record at the close of business on the Friday occurring between the tenth and fifteenth days of the calendar month in which the applicable Dividend Payment Date falls on or such date as shall be fixed by the Board at the time of declaration of the dividend (the "Dividend Record Date"), which shall be not less than 10 nor more than 30 days preceding the Dividend Payment Date. The amount of any dividend payable for the initial Dividend Period and for any other partial Dividend Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends on the shares of Series D Preferred shall accrue and be cumulative from and including the date of original issue thereof (the "Issue Date"), whether or not (1) the Corporation has earnings, (2) dividends on such shares are declared or (3) on any Dividend Payment Date there shall be funds legally available for the payment of such dividends. When dividends are not paid in full upon the shares of Series D Preferred and the shares of any other series of preferred stock ranking on a parity as to dividends with the Series D Preferred (or a sum sufficient for such full payment is not set apart therefor), all dividends declared upon shares of Series D Preferred and any other series of preferred stock ranking on a parity as to dividends with the Series D Preferred shall be declared pro rata so that the amount of dividends declared per share on the Series D Preferred and such other series of preferred stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of Series D Preferred and such other series of preferred stock bear to each other. "Business Day" shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City, New York are authorized or required by law, regulation or executive order to close. (B) Except as provided in subparagraph (A) of this paragraph (iii), unless full cumulative dividends on the Series D Preferred have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment on the Series D Preferred for all past dividend periods and the then current dividend 14 period, no dividends (other than in Junior Stock) shall be declared or paid or set aside for payment or other distribution or shall be declared or made upon any Parity Stock or Junior Stock, nor shall any Junior Stock or any Parity Stock be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of Junior Stock or Parity Stock) by the Corporation or any subsidiary of the Corporation (except by conversion into or exchange for Junior Stock). (C) Any dividend payment made on shares of the Series D Preferred shall first be credited against the earliest accrued but unpaid dividend due with respect to such shares which remains payable. The amount of any dividends accrued on any shares of Series D Preferred at any Dividend Payment Date shall be the amount of any unpaid dividends accumulated thereon, to and including such Dividend Payment Date, whether or not earned or declared, and the amount of dividends accrued on any shares of Series D Preferred at any date other than a Dividend Payment Date shall be equal to the sum of the amount of any unpaid dividends accumulated thereon, to and including the last preceding Dividend Payment Date, whether or not earned or declared, plus an amount calculated on the basis of the annual dividend rate for the period after such last preceding Dividend Payment Date to and including the date as of which the calculation is made, based on a 360-day year of twelve 30-day months. Accrued but unpaid dividends on the Series D Preferred will not bear interest. Holders of the Series D Preferred will not be entitled to any dividends in excess of full cumulative dividends as described above. (D) No dividends on shares of Series D Preferred shall be declared by the Board or paid or set apart for payment by the Corporation at such time as the terms and provisions of any agreement of the Corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law. (E) Except as provided in this Charter, the Series D Preferred shall not be entitled to participate in the earnings or assets of the Corporation. (F) In the event that the per share cash dividends declared on the Common stock during any Dividend Period (the "Current Common Dividend") shall be greater or less than the per share cash dividends declared on the Common Stock during the immediately preceding Dividend Period (the "Prior Common Dividend"), then the dividend rate of the Series D Preferred (as it may have previously been adjusted pursuant to this subparagraph (F)) shall be automatically adjusted in the proportion that the Current Common Dividend bears to the Prior Common Dividend, such adjustment to be effective for the Dividend Period during which the Current Common Dividend is paid and all subsequent Dividend Periods until again adjusted in accordance with this paragraph; provided, however, that in no event shall the adjusted dividend rate of the Series D Preferred be less than 7.5% of the Liquidation Preference of the Series D Preferred per annum. No adjustment pursuant to this subparagraph (F) shall be made on account of any special Common Stock dividend or distribution declared for the purpose of assuring continued qualification of the Corporation as a "real estate investment trust" under the Code. 15 (iv) Liquidation Rights. (A) Upon the voluntary or involuntary dissolution, liquidation or winding up of the Corporation, the holders of shares of the Series D Preferred then outstanding shall be entitled to receive and to be paid out of the assets of the Corporation legally available for distribution to its stockholders, before any distribution shall be made to the holders of Common Stock or any other capital stock of the Corporation ranking junior to the Series D Preferred upon liquidation, a liquidation preference of $25.00 per share (the "Liquidation Preference"), plus accrued and unpaid dividends thereon to the date of payment. (B) After the payment to the holders of the shares of the Series D Preferred of the full Liquidation Preference provided for in this paragraph (iv), the holders of the Series D Preferred as such shall have no right or claim to any of the remaining assets of the Corporation. (C) If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the Corporation, the amounts payable with respect to the Liquidation Preference and any other shares of stock of the Corporation ranking as to any such distribution on a parity with the shares of the Series D Preferred are not paid in full, the holders of the shares of the Series D Preferred and of such other shares will share ratably in any such distribution of assets of the Corporation in proportion to the full respective liquidation preferences to which they are entitled. (D) Neither the sale, lease, transfer or conveyance of all or substantially all the property or business of the Corporation, nor the merger or consolidation of the Corporation into or with any other Corporation or the merger or consolidation of any other Corporation into or with the Corporation, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (iv). (v) Redemption. (A) Right of Optional Redemption. The Series D Preferred is not redeemable prior to the fifth anniversary of the Issue Date. On and after the fifth anniversary of the Issue Date, the Corporation may, at its option, redeem at any time all or, from time to time, part of the Series D Preferred at a price per share (the "Series D Redemption Price"), payable in cash, of $25.00, together with all accrued and unpaid dividends to and including the date fixed for redemption (the "Series D Redemption Date"), without interest; provided, however, that the Corporation may not redeem any Series D Preferred pursuant to this paragraph (v) unless the Current Market Price of the Common Stock on each of the 20 consecutive Trading Days immediately preceding the Series D Redemption Date shall at least equal the then current Conversion Price, as defined in paragraph (vii). "Current Market Price" of the Common Stock or any other class of capital stock or other security of the Corporation or any other issuer for any day shall mean the last reported sale price, regular way, on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, regular way, in either case as reported on the New York Stock Exchange ("NYSE") or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market or, if such security is not quoted on the NASDAQ National Market, the average of the closing bid and asked prices on such day in the over-the-counter market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NYSE member firm regularly making a market in such security and selected for such purpose by the Board. "Trading Day" in respect of any security shall mean any day on which such security is traded on the NYSE, or if such security is not listed or admitted for trading on the NYSE, on the principal national 16 securities exchange on which such security is listed or admitted for trading, or if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market or, if such security is not quoted on the NASDAQ National Market, in the applicable securities market in which the security is traded. In case of redemption of less than all shares of Series D Preferred at the time outstanding, the shares of Series D Preferred to be redeemed shall be selected pro rata from the holders of record of such shares in proportion to the number of shares of Series D Preferred held by such holders (as nearly as may be practicable without creating fractional shares) or by any other equitable method determined by the Corporation. (B) Procedures for Redemption. (1) Notice of any redemption will be mailed by the Corporation, postage prepaid, not less than 30 nor more than 60 days prior to the Series D Redemption Date, addressed to the respective holders of record of the Series D Preferred to be redeemed at their respective addresses as they appear on the stock transfer records of the Corporation. No failure to give such notice or any defect therein or in the mailing thereof shall affect the validity of the proceedings for the redemption of any Series D Preferred except as to the holder to whom the Corporation has failed to give notice or except as to the holder to whom notice was defective. In addition to any information required by law, such notice shall state: (a) the Series D Redemption Date; (b) the Series D Redemption Price; (c) the number of shares of Series D Preferred to be redeemed; (d) the place or places where certificates for such shares are to be surrendered for payment of the Series D Redemption Price; and (e) that dividends on the shares to be redeemed will cease to accumulate on the Series D Redemption Date. If less than all the shares of Series D Preferred held by any holder are to be redeemed, the notice mailed to such holder shall also specify the number of shares of Series D Preferred held by such holder to be redeemed. (2) If notice of redemption of any shares of Series D Preferred has been mailed in accordance with section (1) of subparagraph (B) of this paragraph (v) above and provided that on or before the Series D Redemption Date specified in such notice all funds necessary for such redemption shall have been irrevocably set aside by the Corporation, separate and apart from its other funds in trust for the benefit of any holders of the shares of Series D Preferred so called for redemption, so as to be, and to continue to be available therefor, then, from and after the Series D Redemption Date, dividends on such shares of Series D Preferred shall cease to accrue, and such shares shall no longer be deemed to be outstanding and shall not have the status of Series D Preferred and all rights of the holders thereof as stockholders of the Corporation (except the right to receive the Series D Redemption Price) shall terminate. Upon surrender, in accordance with said notice, of the certificates for any shares of Series D Preferred so redeemed (properly endorsed or assigned for transfer, if the Corporation shall so require and the notice shall so state), such shares of Series D Preferred shall be redeemed by the Corporation at the Series D Redemption Price. In case less than all the shares of Series D Preferred represented by any such certificate are redeemed, a new certificate or certificates shall be issued representing the unredeemed shares of Series D Preferred without cost to the holder thereof. (3) The deposit of funds with a bank or trust company for the purpose of redeeming Series D Preferred shall be irrevocable except that: (a) the Corporation shall be entitled to receive from such bank or trust company the interest or other earnings, if any, earned on any money so deposited in trust, and the holders of any shares redeemed shall have no claim to such interest or other earnings; and 17 (b) any balance of moneys so deposited by the Corporation and unclaimed by the holders of the Series D Preferred entitled thereto at the expiration of two years from the applicable Series D Redemption Date shall be repaid, together with any interest or other earnings earned thereon, to the Corporation, and after any such repayment, the holders of the shares entitled to the funds so repaid to the Corporation shall look only to the Corporation for payment without interest or other earnings. (C) Limitations on Redemption. (1) The Series D Redemption Price (other than the portion thereof consisting of accrued and unpaid dividends) shall be payable solely out of the sale proceeds of other capital stock of the Corporation and from no other source. (2) Unless full cumulative dividends on all shares of Series D Preferred shall have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment for all past Dividend Periods and the then current Dividend Period, no Series D Preferred shall be redeemed (unless all outstanding shares of Series D Preferred are simultaneously redeemed) or purchased or otherwise acquired directly or indirectly by the Corporation (except by exchange for Junior Stock); provided, however, that the foregoing shall not prevent the exchange of Series D Preferred pursuant to Article VI or the purchase or acquisition of Series D Preferred pursuant to a purchase or exchange offer made on the same terms to holders of all outstanding shares of Series D Preferred. (3) The Corporation shall not redeem in any period of 12 consecutive months a number of shares of Series D Preferred having an aggregate Liquidation Preference of more than $100,000,000, provided that this restriction shall lapse and be of no further force or effect if in any such period any holder of record of such number of shares of Series D Preferred or shares of Common Stock issued on conversion of such number of shares of Series D Preferred shall transfer beneficial ownership of such number of shares of Series D Preferred or such Common Stock, or a combination of shares of Series D Preferred and such Common Stock representing such number of shares of Series D Preferred, except (a) in a distribution of such shares of Series D Preferred and/or shares of Common Stock to the security holders of such holder of record or (b) in a bona fide pledge to a bank or other financial institution to secure obligations for borrowed money, or as margin collateral, or upon foreclosure or private sale under such pledge. (D) Rights to Dividends on Shares Called for Redemption. If the Series D Redemption Date is after a Dividend Record Date and before the related Dividend Payment Date, the dividend payable on such Dividend Payment Date shall be paid to the holder in whose name the shares of Series D Preferred to be redeemed are registered at the close of business on such Dividend Record Date notwithstanding the redemption thereof between such Dividend Record Date and the related Dividend Payment Date or the Corporation's default in the payment of the dividend due. Except as provided in this paragraph (v), the Corporation will make no payment or allowance for unpaid dividends, whether or not in arrears, on called Series D Preferred. (vi) Voting Rights. Except as required by the general laws of the State of Maryland and except as otherwise provided in this paragraph (vi), the holders of the Series D Preferred shall not be entitled to vote at any meeting of the stockholders for election of directors or for any other purpose or otherwise to participate in any action taken by the Corporation or the stockholders thereof, or to receive notice of any meeting of stockholders. 18 (A) Whenever dividends on any shares of Series D Preferred shall be in arrears for any Dividend Period, the holders of such shares of Series D Preferred shall have all rights to notices and voting entitlements of holders of Common Stock under the general laws of the State of Maryland and this Charter, and the Series D Preferred and the Common Stock shall be a single voting group, until all dividends accumulated on such shares of Series D Preferred for all past Dividend Periods and the then current Dividend Period shall have been fully paid or declared and a sum sufficient for the payment thereof set aside for payment. (B) So long as any shares of Series D Preferred remain outstanding, the Corporation shall not, without the affirmative vote of the holders of at least a majority of the shares of the Series D Preferred outstanding at the time, (i) authorize or create, or increase the authorized or issued amount of, any class or series of capital stock ranking prior to the Series D Preferred with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up or reclassify any authorized capital stock of the Corporation into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares; or (ii) amend, alter or repeal the provisions of this Charter, whether by merger, consolidation or otherwise, so as to materially and adversely affect any right, preference, privilege or voting power of the Series D Preferred or the holders thereof; provided, however, that any increase in the amount of the authorized preferred stock or the creation or issuance of any other series of preferred stock, or any increase in the amount of authorized shares of such series, in each case ranking on a parity with or junior to the Series D Preferred with respect to payment of dividends or the distribution of assets upon liquidation, dissolution or winding up, shall not be deemed to materially and adversely affect such rights, preferences, privileges or voting powers. (C) The foregoing voting provisions will not apply if, at or prior to the time when the act with respect to which such vote would otherwise be required shall be effected, all outstanding shares of Series D Preferred shall have been redeemed or called for redemption upon proper notice and sufficient funds shall have been deposited in trust to effect such redemption. (vii) Conversion of Series D Preferred. (A) As used in this paragraph (vii), the following terms shall have the indicated meanings: "Adjustment Factor," for purposes of any determination provided for in this paragraph (vii) requiring reference to the Adjustment Factor, shall equal the Conversion Price in effect on the determination date divided by $16.25. "Conversion Price" shall mean the conversion price per share of Common Stock at which the Series D Preferred is convertible into Common Stock, as such Conversion Price may be adjusted pursuant to subparagraph (E) of this paragraph (vii). The initial Conversion Price shall be $16.25. "Conversion Rate" shall mean the rate at which the Series D Preferred is convertible into Common Stock, as such Conversion Rate may be adjusted pursuant to subparagraph (E) of this paragraph (vii). The initial Conversion Rate shall be 1.5385 shares of Common Stock for each share of Series D Preferred. "Fair Market Value," in the case of any security or property not having a market value ascertainable by reference to any quotation medium or other objective source, shall mean 19 the fair market value thereof as determined in good faith by the Board, which determination shall be final, conclusive and binding on all persons. "Transfer Agent" shall mean Mellon Investor Services, LLC, or such other agent or agents of the Corporation as may be designated by the Board as the transfer agent for the Series D Preferred. (B) Subject to and upon compliance with the provisions of this paragraph (vii), a holder of shares of Series D Preferred shall have the right (the "Conversion Right"), at such holder's option, at any time and from time to time, to convert such shares into the number of shares of fully paid and nonassessable Common Stock obtained by dividing the aggregate Liquidation Preference of such shares of Series D Preferred by the Conversion Price (as in effect at the time and on the date provided for in the last paragraph of subparagraph (C) of this paragraph (vii)) by surrendering such shares to be converted, such surrender to be made in the manner provided in subparagraph (C) of this paragraph (vii); provided, however, that the right to convert shares called for redemption pursuant to paragraph (v) shall terminate at the close of business on the Series D Redemption Date fixed for such redemption, unless the Corporation shall default in making payment of any amounts payable upon such redemption under paragraph (v). (C) In order to exercise the Conversion Right, the holder of each share of Series D Preferred to be converted shall surrender the certificate evidencing such share, duly endorsed or assigned to the Corporation or in blank, at the office of the Transfer Agent, accompanied by written notice to the Corporation that the holder thereof elects to convert such share of Series D Preferred. Unless the certificate or certificates for shares of Common Stock issuable on conversion are to be registered in the same name as the name in which such certificate for Series D Preferred is registered, each certificate surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the Corporation, duly executed by the holder or such holder's duly authorized agent and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the Corporation demonstrating that such taxes have been paid). Holders of Series D Preferred at the close of business on a Dividend Record Date shall be entitled to receive the dividend payable on the corresponding Dividend Payment Date notwithstanding the conversion thereof following such Dividend Record Date and prior to such Dividend Payment Date. However, shares of Series D Preferred surrendered for conversion during the period beginning with the close of business on any Dividend Record Date and ending with the opening of business on the corresponding Dividend Payment Date (except shares converted after the issuance of a notice of redemption specifying a Series D Redemption Date occurring within such period or coinciding with such Dividend Payment Date, such shares being entitled to such dividend on the Dividend Payment Date) must be accompanied by payment of an amount equal to the dividend payable on such shares on such Dividend Payment Date. A holder of shares of Series D Preferred on a Dividend Record Date who (or whose transferee) surrenders any such shares for conversion into Common Stock after the opening of business on the corresponding Dividend Payment Date will receive the dividend payable by the Corporation on such Series D Preferred on such date, and the converting holder need not include payment of the amount of such dividend upon such surrender. The Corporation shall make further payment or allowance for, and a converting holder shall be entitled to, unpaid dividends in arrears (excluding the then-current quarter) on converted shares and for dividends on the Common Stock issued upon such conversion. As promptly as practicable after the surrender of certificates for Series D Preferred as aforesaid, the Corporation shall issue and shall deliver at such office to such holder, or on such holder's written order, a certificate or certificates for the number of full shares of Common Stock 20 issuable upon the conversion of such Series D Preferred in accordance with the provisions of this paragraph (vii), and any fractional interest in respect of Common Stock arising upon such conversion shall be settled as provided in subparagraph (D) of this paragraph (vii). Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series D Preferred shall have been surrendered and such notice (and if applicable, payment of an amount equal to the dividend payable on such shares) received by the Corporation as aforesaid, and the person or persons in whose name or names any certificate or certificates for Common Stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, and such conversion shall be at the Conversion Price in effect at such time and on such date, unless the share transfer books of the Corporation shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the opening of business on the next succeeding day on which such share transfer books are open, but such conversion shall be at the Conversion Price in effect on the date on which such certificates for Series D Preferred have been surrendered and such notice received by the Corporation. (D) No fractional shares or scrip representing fractions of Common Stock shall be issued upon conversion of the Series D Preferred. In lieu of issuing a fractional interest in Common Stock that would otherwise be deliverable upon the conversion of a share of Series D Preferred, the Corporation shall pay to the holder of such share an amount in cash based upon the Current Market Price of the Common Stock on the Trading Day immediately preceding the date of conversion. If more than one share of Series D Preferred shall be surrendered for conversion at one time by the same holder, the number of full shares of Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of Series D Preferred so surrendered. (E) The Conversion Rate and Conversion Price shall be adjusted from time to time as follows: (1) If the Corporation shall after the Issue Date (a) declare and pay a dividend to holders of any class of capital stock of the Corporation payable in Common Stock, (b) subdivide its outstanding Common Stock into a greater number of shares, (c) combine its outstanding Common Stock into a smaller number of shares or (d) reclassify its Common Stock, the Conversion Rate shall be adjusted so that the holder of any Series D Preferred thereafter surrendered for conversion shall be entitled to receive the number of shares of Common Stock that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such shares been converted immediately prior to the record date in the case of a dividend or the effective date in the case of a subdivision, combination or reclassification. An adjustment made pursuant to this section (1) shall become effective immediately after the opening of business on the day next following the record date (except as provided in subparagraph (I) below) in the case of a dividend and shall become effective immediately after the opening of business on the day next following the effective date in the case of a subdivision, combination or reclassification. Such adjustment(s) shall be made successively whenever any of the events listed above shall occur. (2) If the Corporation shall issue after the Issue Date rights, options or warrants to all holders of Common Stock entitling them to subscribe for or purchase Common Stock (or securities convertible into Common Stock) at a price per share (or having a conversion price per share) less than 98% of the Current Market Price of the Common Stock determined as of the record date for the determination of stockholders entitled to receive such rights, options or warrants, then the Conversion Price shall be adjusted to equal the price determined by multiplying (a) the Conversion Price in effect immediately prior to the close of business on such record date by (b) a fraction, the numerator of which shall be the sum of (i) the number of shares of Common Stock outstanding on the close of business on such record date and (ii) the number of shares of Common Stock that could be purchased at the 21 Current Market Price of the Common Stock determined as of the record date for the determination of stockholders entitled to receive such rights, options or warrants, then the Conversion Price shall be adjusted to equal the price determined by multiplying (a) the Conversion Price in effect immediately prior to the close of business on such record date by (b) a fraction, the numerator of which shall be the sum of (i) the number of shares of Common Stock outstanding on the close of business on such record date and (ii) the number of shares of Common Stock that could be purchased at the Current Market Price on such record date with the aggregate proceeds to the Corporation from the exercise of such rights, options or warrants (or the aggregate conversion price of the convertible securities so offered), and the denominator of which shall be the sum of (x) the number of shares of Common Stock outstanding on the close of business on such record date and (y) the number of shares of Common Stock issuable upon exercise in full of such rights, options or warrants (or into which the convertible securities so offered are convertible). Such adjustment shall become effective immediately after the opening of business on the day next following such record date (except as provided in subparagraph (I) below). In determining whether any rights, options or warrants entitle the holders of Common Stock to subscribe for or purchase Common Stock at less than 98% of the Current Market Price, there shall be taken into account any consideration received by the Corporation upon issuance and upon exercise of such rights, options or warrants, the value of such consideration, if other than cash, to be determined by the Board, whose decision shall be final, conclusive, and binding on all persons. Any adjustment(s) made pursuant to this section (2) shall be made successively whenever any of the events listed above shall occur. (3) If the Corporation shall after the Issue Date distribute to all holders of its Common Stock any shares of capital stock of the Corporation (other than Common Stock) or evidence of its indebtedness or assets (including securities or cash, but excluding cash dividends not exceeding in amount current or accumulated funds from operations at the date of declaration, determined on the basis of the Corporation's most recent annual or quarterly report to stockholders at the time of the declaration of such dividends) or rights, options or warrants to subscribe for or purchase any of its securities (excluding rights, options or warrants referred to in section (2) above) (any of the foregoing being hereinafter in this section (3) called the "Securities"), then in each case the Conversion Price shall be adjusted so that it shall equal the price determined by multiplying (a) the Conversion Price in effect immediately prior to the close of business on the record date fixed for the determination of stockholders entitled to receive such distribution by (b) a fraction, the numerator of which shall be (i) the Current Market Price per share of Common Stock on such record date or, if applicable, the deemed record date described in the immediately following paragraph, less (ii) the then Fair Market Value of the Securities or assets so distributed applicable to one share of Common Stock, and the denominator of which shall be the Current Market Price per share of Common Stock on such record date or, if applicable, the record date described in the immediately following paragraph. Such adjustment shall become effective immediately at the opening of business on the Business Day next following (except as provided in subparagraph (i)) such record date. For purposes of this section (3), distribution of a Security which is distributed not only to the holders of the Common Stock on the record date fixed for the determination of stockholders entitled to such distribution, but is also delivered with each share of Common Stock issued upon conversion of Series D Preferred after such record date, shall not require an adjustment of the Conversion Price pursuant to this section (3); provided that on the date, if any, on which such Security ceases to be deliverable with Common Stock upon conversion of Series D Preferred (other than as a result of the expiration or termination of all such Securities), a distribution of such Securities shall be deemed to have occurred, and the Conversion Price shall be adjusted as provided in this section (3) (and such date shall be deemed for purposes of this section (3) to be the "record date fixed for the determination of stockholders entitled to receive such distribution" and the "record date"). Adjustment(s) made pursuant to this section (3) shall be made successively whenever any of the events listed above shall occur. (4) If after the Issue Date (i) the Corporation shall merge or consolidate with any other real estate investment trust, corporation or other business entity and shall not be the survivor in such transaction (without respect to the legal structure of the transaction), (ii) the Corporation shall transfer or sell all or substantially all of its assets other than to an affiliate or subsidiary 22 of the Corporation or (iii) the Corporation shall liquidate and dissolve, and the consideration allocable to each share of Common Stock in any such transaction shall not have a Fair Market Value of at least $15 times the Adjustment Factor, the Conversion Price in effect at the opening of business on the date on which such transaction is consummated or effective, if greater than $15 times the Adjustment Factor, shall be adjusted effective at the opening of business on such date to equal $15 times the Adjustment Factor. (5) If the Current Market Price of the Common Stock on at least 20 consecutive Trading Days during the period of 36 consecutive months beginning on the second anniversary of the Issue Date is not at least $14 times the Adjustment Factor, and the Conversion Price in effect at the opening of business on the fifth anniversary of the Issue Date or the next succeeding Business Day, if such fifth anniversary is not a Business Day, is greater than $15.25 times the Adjustment Factor, the Conversion Price shall be adjusted effective at the opening of business on such fifth anniversary or the next following Business Day, if such fifth anniversary is not a Business Day, to equal $15.25 times the Adjustment Factor. (6) No adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price; provided, however, that any adjustments that by reason of this section (6) are not required to be made shall be carried forward and taken into account in any subsequent adjustment until made; and provided, further, that any adjustment shall be required and made in accordance with the provisions of this paragraph (vii) (other than this section (6)) not later than such time as may be required in order to preserve the tax-free nature of a dividend to the holders of Common Stock. Notwithstanding any other provisions of this paragraph (vii), the Corporation shall not be required to make any adjustment to the Conversion Price for the issuance of any Common Stock pursuant to any plan providing for the reinvestment of dividends or interest payable on securities of the Corporation and the investment of additional optional amounts in Common Stock under such plan. All calculations under this paragraph (vii) shall be made to the nearest cent (with $.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a share being rounded upward), as the case may be. (F) If the Corporation shall after the Issue Date be a party to any transaction (including without limitation a merger, consolidation, statutory share exchange, self tender offer for all or substantially all of the outstanding Common Stock, sale of all or substantially all of the Corporation's assets, recapitalization or reclassification of capital stock, but excluding any transaction to which section (1) of subparagraph (E) of this paragraph (vii) applies) (each of the foregoing being referred to herein as a "Transaction"), in each case upon consummation of which Common Stock shall be converted into the right to receive shares, stock, securities or other property (including cash) or any combination thereof ("Transaction Consideration"), each share of Series D Preferred which is not itself converted into the right to receive Transaction Consideration in connection with such Transaction shall thereafter be convertible into the kind and amount of Transaction Consideration payable upon the consummation of such Transaction with respect to that number of shares of Common Stock into which one share of Series D Preferred was convertible immediately prior to such Transaction. The Corporation shall not be a party to any Transaction unless the terms of such Transaction are consistent with this subparagraph (F) and enable the holder of each share of Series D Preferred that remains outstanding after consummation of such Transaction to convert such share at the Conversion Price in effect immediately prior to such Transaction into the Transaction Consideration payable with respect to the number of shares of Common Stock into which such share of Series D Preferred is then convertible. The provisions of this subparagraph (F) shall similarly apply to successive Transactions. 23 (G) If after the Issue Date: (1) the Corporation shall declare dividends on the Common Stock, excluding cash dividends not exceeding in amount current or accumulated funds from operations at the date of declaration, determined on the basis of the Corporation's most recent annual or quarterly report to stockholders at the time of the declaration of such dividends; or (2) the Corporation shall authorize the granting to the holders of the Common Stock of rights, options or warrants to subscribe for or purchase any shares of any class or any other rights, options or warrants; or (3) there shall be any Transaction for which approval of any stockholders of the Corporation is required or self tender for all or substantially all of the outstanding Common Stock; or (4) there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Corporation; then the Corporation shall cause to be filed with the Transfer Agent and shall cause to be mailed to the holders of the Series D Preferred at their addresses as shown on the share records of the Corporation, as promptly as possible, but at least 15 days prior to the earliest applicable date hereinafter specified, a notice stating (a) the record date as of which the holders of Common Stock entitled to receive such dividend or grant of rights, options or warrants are to be determined, provided, however, that no such notification need be made in respect of a record date for a dividend or grant of rights, options or warrants unless the corresponding adjustment in the Conversion Price would be an increase or decrease of at least 1%, or (b) the date on which such Transaction, self tender, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their Common Stock for securities or other property, if any, deliverable upon such Transaction, self tender, liquidation, dissolution or winding up. Failure to give such notice or any defect therein shall not affect the legality or validity of the proceedings described in this paragraph (vii). (H) Whenever the Conversion Price is adjusted as herein provided, the Corporation shall promptly file with the Transfer Agent a certificate of its chief financial or chief accounting officer setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment, which certificate shall be conclusive evidence of the correctness of such adjustment absent manifest error. Promptly after delivery of such certificate, the Corporation shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and the effective date on which such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to the holder of each share of Series D Preferred at such holder's last address of record. (I) In any case in which subparagraph (E) of this paragraph (vii) provides that an adjustment shall become effective on the date next following the record date for an event, the Corporation may defer until the occurrence of such event (1) issuing to the holder of any Series D Preferred converted after such record date and before the occurrence of such event the additional Common Stock issuable upon such conversion by reason of the adjustment required by such event over and above the Common Stock issuable upon such conversion before giving effect to such adjustment and (2) fractionalizing any share of Common Stock into which Series D Preferred is convertible and/or paying to such holder cash in lieu of such fractional interest pursuant to subparagraph (D) of this paragraph (vii). 24 (J) There shall be no adjustment of the Conversion Price in case of the issuance of any shares of capital stock of the Corporation in a reorganization, acquisition or other similar transaction except as specifically set forth in this paragraph (vii). (K) The Corporation will at all times reserve and keep available, free from preemptive rights, out of its authorized but unissued Common Stock, for the purpose of effecting conversion of the Series D Preferred, the full number of shares of Common Stock deliverable upon the conversion of all outstanding Series D Preferred not theretofore converted. For purposes of this subparagraph (K), the number of shares of Common Stock deliverable upon the conversion of all outstanding shares of Series D Preferred shall be computed as if at the time of computation all such outstanding shares were held by a single holder. (L) The Corporation will pay any and all documentary stamp or similar issue or transfer taxes payable in respect of the issue or delivery of Common Stock or other securities or property on conversion of the Series D Preferred pursuant hereto; provided, however, that the Corporation shall not be required to pay any tax that may be payable in respect of any transfer involved in the issue or delivery of Common Stock or other securities or property in a name other than that of the holder of the Series D Preferred to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue or delivery has paid to the Corporation the amount of any such tax or has established, to the reasonable satisfaction of the Corporation, that such tax has been paid. In addition to the foregoing adjustments, the Corporation shall be entitled to make such reductions in the Conversion Price, in addition to those required herein, as it in its discretion considers to be advisable in order that any share dividends, subdivisions of shares, reclassification or combination of shares, dividend of rights, options, warrants to purchase shares or securities, or a dividend of other assets (other than cash dividends) will not be taxable or, if that is not possible, to diminish any income taxes that are otherwise payable because of such event. (M) Definitions. Unless the context otherwise clearly indicates, terms defined in any subdivision of this paragraph (vii) shall have the same meanings wherever used in this paragraph (vii). (d) Series E Cumulative Convertible Preferred Stock. (1) Designation and Number. A series of the preferred stock, designated the "Series E Cumulative Convertible Preferred Stock" (the "Series E Preferred"), is hereby established. The number of shares of the Series E Preferred shall be 3,425,217. (2) Relative Seniority. In respect of rights to receive dividends until the Cross Over Date (as defined below) and to participate in distributions or payments in the event of any liquidation, dissolution or winding up of the corporation, the Series E Preferred shall rank pari passu with the Series B Preferred and the Series D Preferred and any other capital stock of the corporation designated as ranking pari passu with the Series B Preferred, the Series D Preferred or the Series E Preferred, as to dividends or payments in the event of any liquidation, dissolution or winding up of the corporation (collectively, "Series E Parity Stock"), and senior to the common stock and any other class or series of capital stock of the corporation designated as ranking junior to the Series E Preferred or any Series E Parity Stock (collectively, "Junior Stock"). 25 (3) Dividends. (A) Until the Cross Over Date, the holders of the then outstanding Series E Preferred shall be entitled to receive, out of any funds legally available therefor, cumulative preferential cash dividends at the rate of 8% of the Liquidation Preference of the Series E Preferred (equivalent to $1.3288 per share) per annum, payable quarterly in cash in arrears on the last day, or the next succeeding Business Day, of January, April, July and October in each year, beginning July 31, 2003 (each such day being hereinafter called a "Series E Dividend Payment Date" and each period beginning on the day succeeding a Series E Dividend Payment Date and ending on the next following Series E Dividend Payment Date being hereinafter called a "Series E Dividend Period"), to shareholders of record at the close of business on such date as shall be fixed by the Board of Directors at the time of declaration of the dividend (the "Series E Dividend Record Date"), which shall be not less than 10 nor more than 30 days preceding the Series E Dividend Payment Date. The amount of any dividend payable for the initial Series E Dividend Period and for any other partial Series E Dividend Period shall be computed on the basis of a 360-day year consisting of twelve 30-day months. Dividends on the shares of Series E Preferred shall accrue and be cumulative from and including the date of original issue thereof (the "Issue Date"), whether or not (i) the corporation has earnings, (ii) dividends on such shares are declared or (iii) on any Series E Dividend Payment Date there shall be funds legally available for the payment of such dividends. When dividends are not paid in full upon the shares of Series E Preferred and the shares of Series E Parity Stock (or a sum sufficient for such full payment is not set apart therefor), all dividends declared upon shares of Series E Preferred or any other Series E Parity Stock shall be declared pro rata among all classes or series of Series E Parity Stock so that the amount of dividends declared per share on the Series E Preferred and such other Series E Parity Stock shall in all cases bear to each other the same ratio that accrued dividends per share on the shares of Series E Preferred and such other Series E Parity Stock bear to each other. "Business Day" shall mean any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in New York City, New York are authorized or required by law, regulation or executive order to close. Notwithstanding any provision of this paragraph (3) to the contrary, from and after the Cross Over Date the holders of the then outstanding Series E Preferred will be entitled to receive dividends in such amount and at such time as dividends are paid to holders of common stock, without preference, calculated on an as converted basis. Such dividends shall be paid quarterly in cash in arrears. Dividends on the Series E Preferred will cumulate to the extent not declared and paid in full whether or not (i) there exists funds legally available for the payment of such dividends or (ii) such dividends have been authorized. (B) Prior to the Cross Over Date, unless full cumulative dividends on the Series E Preferred have been or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof set apart for payment on the Series E Preferred for all past Series E Dividend Periods and the then current Series E Dividend Period, no dividends (other than in Junior Stock) shall be declared or paid or set aside for payment or other distribution or shall be declared or made upon any Junior Stock, nor shall any Junior Stock or any Series E Parity Stock be redeemed, purchased or otherwise acquired for any consideration (or any moneys be paid to or made available for a sinking fund for the redemption of any shares of Junior Stock) or Series E Parity Stock by the corporation (except by conversion into or exchange for other Junior Stock or Parity Stock). (C) Any dividend payment made on shares of the Series E Preferred shall first be credited against the earliest accrued but unpaid dividend due with respect to such shares. The amount of any dividends accrued on any shares of Series E Preferred at any Series E Dividend Payment Date shall be the amount of any unpaid dividends accumulated thereon, to and including such Series E Dividend Payment Date, whether or not earned or declared, and the amount of dividends accrued on any shares of Series E Preferred at any date other than a Series E 26 Dividend Payment Date shall be equal to the sum of the amount of any unpaid dividends accumulated thereon, to and including the last preceding Series E Dividend Payment Date, whether or not earned or declared, plus an amount calculated on the basis of the annual dividend rate for the period after such last preceding Series E Dividend Payment Date to and including the date as of which the calculation is made, based on a 360-day year of twelve 30-day months. Accrued but unpaid dividends on the Series E Preferred will not bear interest. Holders of the Series E Preferred will not be entitled to any dividends in excess of full cumulative dividends as described above. (D) No dividends on shares of Series E Preferred shall be declared by the Board of Directors of the corporation or paid or set apart for payment by the corporation at such time as the terms and provisions of any agreement of the corporation, including any agreement relating to its indebtedness, prohibits such declaration, payment or setting apart for payment or provides that such declaration, payment or setting apart for payment would constitute a breach thereof or a default thereunder, or if such declaration or payment shall be restricted or prohibited by law. (E) Except as provided in these Articles, the Series E Preferred shall not be entitled to participate in the earnings or assets of the corporation. (F) For purposes of this paragraph (d) the term "Cross Over Date" means the date on which the holders of the Series E Preferred would have received, in respect of such Series E Preferred, dividends in an annualized amount equal to or greater than the Threshold Amount for a period of four (4) consecutive calendar quarters, had such holders received dividends equivalent to the dividends paid to holders of common stock, calculated on an as converted basis, for such four (4) consecutive calendar quarter period. For purposes of this paragraph (d) the term "Threshold Amount" means the amount of the annual dividends earned on the Series E Preferred Stock pursuant to this paragraph (3). (4) Liquidation Rights. (A) Upon the voluntary or involuntary dissolution, liquidation or winding up of the corporation, the holders of shares of the Series E Preferred then outstanding shall be entitled to receive and to be paid out of the assets of the corporation legally available for distribution to its shareholders on parity with the Parity Stock, before any distribution shall be made to the holders of any Junior Stock, a liquidation preference of $16.61 per share, plus dividends thereon accrued and unpaid for any period prior to the Cross Over Date to the date of payment (the "Liquidation Preference"). (B) After the payment to the holders of the shares of the Series E Preferred of the full Liquidation Preference, the holders of the Series E Preferred as such shall have no right or claim to any of the remaining assets of the corporation. (C) If, upon any voluntary or involuntary dissolution, liquidation, or winding up of the corporation, the Liquidation Preference and any amounts payable as a liquidation preference to other shares of Series E Parity Stock are not paid in full, the holders of the shares of the Series E Preferred and of such other shares of Series E Parity Stock will share ratably in any such distribution of assets of the corporation in proportion to the full respective liquidation preferences to which they are entitled. (D) Neither the sale, lease, transfer or conveyance of all or substantially all the assets or business of the corporation, nor the merger or consolidation of the 27 corporation into or with any other corporation or the merger or consolidation of any other corporation into or with the corporation, shall be deemed to be a dissolution, liquidation or winding up, voluntary or involuntary, for the purposes of this paragraph (4). (5) Voting Rights. (A) Except as otherwise provided in this paragraph (5), the holders of the Series E Preferred shall be entitled to vote on an as converted basis as a single class in combination with the holders of common stock at any meeting of the shareholders for the election of directors or for any other purpose on which the holders of common stock are entitled to vote or to participate in any action taken by the holders of common stock. The holders of the Series E Preferred also shall be entitled to vote as a class on any matter that the Maryland General Corporation Law requires the Series E Preferred to vote on as a separate class. The holders of Series E Preferred shall be entitled to receive notice of any meeting of the holders of common stock. (B) So long as any shares of Series E Preferred remain outstanding, the corporation shall not, without the affirmative vote of the holders of at least a majority of the shares of the Series E Preferred then outstanding, authorize or create, or increase the authorized or issued amount of, the Series E Preferred (other than in connection with a pro rata distribution of Series E Preferred to the holders thereof) or any class or series of capital stock ranking prior to the Series E Preferred with respect to the distribution of assets upon liquidation, dissolution or winding up of the corporation or reclassify any authorized capital stock of the corporation into any such shares, or create, authorize or issue any obligation or security convertible into or evidencing the right to purchase any such shares. (6) Conversion of Series E Preferred. (A) Subject to and upon compliance with the provisions of this paragraph (6), a holder of shares of Series E Preferred shall have the right (the "Conversion Right"), at such holder's option, at any time and from time to time, to convert each share of Series E Preferred into, subject to subparagraphs (D), (E) and (F) of this paragraph (6), one share of fully paid and nonassessable common stock of the corporation by surrendering the certificate evidencing such shares to be converted, in the manner provided in subparagraph (B) of this paragraph (6). (B) In order to exercise the Conversion Right, the holder of each share of Series E Preferred to be converted shall surrender the certificate evidencing such share, duly endorsed or assigned to the corporation or in blank, at the office of the corporation's transfer agent, accompanied by written notice to the corporation that the holder thereof elects to convert such share of Series E Preferred. Unless the certificate or certificates for shares of common stock issuable on conversion are to be registered in the same name as the name in which such certificate for Series E Preferred is registered, each certificate surrendered for conversion shall be accompanied by instruments of transfer, in form satisfactory to the corporation, duly executed by the holder or such holder's duly authorized agent and an amount sufficient to pay any transfer or similar tax (or evidence reasonably satisfactory to the corporation demonstrating that such taxes have been paid). Holders of Series E Preferred at the close of business on a Series E Dividend Record Date shall be entitled to receive the dividend payable on the corresponding Series E Dividend Payment Date notwithstanding the conversion of the Series E Preferred following such Series E Dividend Record Date and prior to such Series E Dividend Payment Date. However, shares of Series E Preferred surrendered for conversion during the period beginning with the close of business on any Series E Dividend Record Date and ending with the opening of business on the corresponding Series E Dividend Payment Date must be accompanied by payment of an amount equal to the dividend payable on such 28 shares on such Series E Dividend Payment Date. The corporation shall make further payment or allowance for, and a converting holder shall be entitled to, accrued but unpaid dividends in arrears (excluding the then current quarter) on converted shares and for dividends on the common stock issued upon such conversion. A holder of shares of Series E Preferred on a Series E Dividend Record Date who (or whose transferee) surrenders any such shares for conversion into common stock after the opening of business on the corresponding Series E Dividend Payment Date will receive the dividend payable by the corporation on such Series E Preferred on such date, and the converting holder need not include payment of the amount of such dividend upon such surrender. As promptly as practicable after the surrender of certificates for Series E Preferred as aforesaid, the corporation shall issue and shall deliver at such office to such holder, or on his written order, a certificate or certificates for the number of whole shares of common stock issuable upon the conversion of such Series E Preferred in accordance with the provisions of this paragraph (6), and any fractional interest in respect of common stock arising upon such conversion shall be settled as provided in subparagraph (C) of this paragraph (6). Each conversion shall be deemed to have been effected immediately prior to the close of business on the date on which the certificates for Series E Preferred shall have been surrendered and such notice (and if applicable, payment of an amount equal to the dividend payable on such shares) received by the corporation as aforesaid, and the person or persons in whose name or names any certificate or certificates for common stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares represented thereby at such time on such date, unless the share transfer books of the corporation shall be closed on that date, in which event such person or persons shall be deemed to have become such holder or holders of record at the opening of business on the next succeeding day on which such share transfer books are open. (C) No fractional shares or scrip representing fractions of common stock shall be issued upon conversion of the Series E Preferred. In lieu of issuing a fractional interest in common stock that would otherwise be deliverable upon the conversion of a share of Series E Preferred, the corporation shall pay to the holder of such share an amount in cash equal to such fraction multiplied by the Current Market Price of the common stock on the Trading Day immediately preceding the date of conversion. If more than one share of Series E Preferred shall be surrendered for conversion at one time by the same holder, the number of full shares of common stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of Series E Preferred so surrendered. For purposes of this paragraph (C) "Current Market Price" of the common stock shall mean the last reported sale price on such day or, if no sale takes place on such day, the average of the reported closing bid and asked prices on such day, in either case as reported on the New York Stock Exchange ("NYSE") or, if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading or, if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market or, if such security is not quoted on the NASDAQ National Market, the average of the closing bid and asked prices on such day in the over-the-counter market as reported by NASDAQ or, if bid and asked prices for such security on such day shall not have been reported through NASDAQ, the average of the bid and asked prices on such day as furnished by any NASD member firm regularly making a market in such security and selected for such purpose by the Board of Directors. For purposes of this paragraph (C) "Trading Day" shall mean any day on which the common stock is traded on the NYSE, or if such security is not listed or admitted for trading on the NYSE, on the principal national securities exchange on which such security is listed or admitted for trading, or if not listed or admitted for trading on any national securities exchange, on the NASDAQ National Market or, if such security is not quoted on the NASDAQ National Market, in the applicable securities market in which the security is traded. (D) If after the Issue Date the corporation shall change the Series E Preferred or the common stock into the same or a different number of shares of any class or classes of 29 capital stock, whether by capital reorganization, reclassification or otherwise, then and in each event each holder of the Series E Preferred shall have the right to convert such shares of Series E Preferred into such kind and amount of shares of capital stock as such holder would have received if the holder had converted the Series E Preferred into common stock immediately prior to such reorganization, reclassification or other change. (E) If after the Issue Date the corporation shall be a party to any transaction including without limitation a merger, consolidation, statutory share exchange, self tender offer for all or substantially all of the outstanding common stock, sale of all or substantially all of the corporation's assets, recapitalization or reclassification of capital stock, other than a reorganization or reclassification set forth in subparagraph (D) of this paragraph (6) (each of the foregoing being referred to herein as a "Transaction"), in each case upon consummation of which common stock shall be converted into the right to receive shares, stock, securities or other property (including cash) or any combination thereof ("Transaction Consideration"), each share of Series E Preferred shall be convertible into the kind and amount of Transaction Consideration payable upon the consummation of such Transaction with respect to that number of shares of common stock into which one share of Series E Preferred was convertible immediately prior to such Transaction. The corporation shall not be a party to any Transaction unless the terms of such Transaction are consistent with this subparagraph (E). The provisions of this subparagraph (E) shall similarly apply to successive Transactions. (F) If after the Issue Date the corporation shall make or issue, or fix a record date for the holders of common stock entitled to receive, a dividend or other distribution payable in securities issued by the corporation, then and in each event, provision shall be made so that each holder of Series E Preferred shall be entitled to receive, upon conversion of the Series E Preferred, in addition to shares of common stock receivable thereupon, such number of such securities as such holder would have received if the holder had converted the Series E Preferred immediately prior to the date of such event and had continued to hold such securities until the conversion date. (G) If after the Issue Date: (i) the corporation shall declare dividends on the common stock, excluding cash dividends not exceeding in amount current or accumulated funds from operations at the date of declaration, determined on the basis of the corporation's most recent annual or quarterly report to shareholders at the time of the declaration of such dividends; (ii) the corporation shall authorize the granting to the holders of the common stock of rights, options or warrants to subscribe for or purchase any shares of any class or any other rights, options or warrants; (iii) there shall be any Transaction for which approval of any shareholders of the corporation is required; or (iv) there shall occur the voluntary or involuntary liquidation, dissolution or winding up of the corporation; then the corporation shall cause to be mailed to the holders of the Series E Preferred at their addresses as shown on the share records of the corporation, as promptly as possible, but at least 15 days prior to the earliest applicable date hereinafter specified, a notice stating (i) the record date as of which the holders of common stock entitled to receive such dividend or grant of rights, options or warrants are to be determined, provided, however, that no such notification need be made in respect of a record date for a dividend or grant of rights, options or warrants, or (ii) the date on 30 which such Transaction, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of common stock of record shall be entitled to exchange their common stock for securities or other property, if any, deliverable upon such Transaction, liquidation, dissolution or winding up. Failure to give such notice or any defect therein shall not affect the legality or validity of the proceedings described in this paragraph (6). (H) The corporation will at all times reserve and keep available, free from preemptive rights, out of its authorized but unissued common stock, for the purpose of effecting conversion of the Series E Preferred, the full number of shares of common stock deliverable upon the conversion of all outstanding Series E Preferred not theretofore converted. For purposes of this subparagraph (H), the number of shares of common stock deliverable upon the conversion of all outstanding shares of Series E Preferred shall be computed as if at the time of computation all such outstanding shares were held by a single holder. (I) Definitions. Unless the context otherwise clearly indicates, terms defined in any subdivision of this paragraph (6) shall have the same meanings wherever used in this paragraph (6). Section 5.5 Issuance of Authorized Shares. The Board is hereby empowered to authorize from time to time the issuance or sale of shares of its stock of any class, whether now or hereafter authorized, or securities convertible into shares of its stock of any class or classes, whether now or hereafter authorized, for such consideration as may be deemed advisable by the Board and without any action by the stockholders. Section 5.6 Classified or Reclassified Shares. Prior to issuance of classified or reclassified shares of any class or series, the Board by resolution shall: (a) designate that class or series to distinguish it from all other classes and series of stock of the Corporation; (b) specify the number of shares to be included in the class or series; (c) set or change, subject to the provisions of Article VI and subject to the express terms of any class or series of stock outstanding at the time, the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms and conditions of redemption for each class or series; and (d) cause the Corporation to file articles supplementary with the State Department of Assessments and Taxation of Maryland ("SDAT"). Any of the terms of any class or series of stock set or changed pursuant to clause (c) of this Section 5.6 may be made dependent upon facts or events ascertainable outside this Charter (including determinations by the Board or other facts or events within the control of the Corporation) and may vary among holders thereof, provided that the manner in which such facts, events or variations shall operate upon the terms of such class or series of stock is clearly and expressly set forth in the articles supplementary filed with the SDAT. Section 5.7 Charter and Bylaws. All persons who acquire stock in the Corporation shall acquire the same subject to the provisions of this Charter and the Bylaws. Section 5.8 Rights of Objecting Stockholders. Holders of shares shall not be entitled to exercise any rights of an objecting stockholder provided for under Title 3, Subtitle 2 of the Maryland General Corporation Law unless the Board, upon the affirmative vote of a majority of the entire Board, shall determine that such rights shall apply, with respect to all or any classes or series of stock, to a particular transaction or all transactions occurring after the date of such approval in connection with which holders of such shares would otherwise be entitled to exercise such rights. 31 ARTICLE VI RESTRICTIONS ON OWNERSHIP AND TRANSFER TO PRESERVE TAX BENEFIT Section 6.1 Restrictions on Transfer; Exchange for Excess Stock. (a) Definitions. The following terms shall have the following meanings: "Beneficial Ownership" shall mean ownership of Capital Stock by a Person who would be treated as an owner of such shares of Capital Stock either directly or indirectly through the application of Section 544 of the Code, as modified by Section 856(h)(1)(B) of the Code. The terms "Beneficial Owner," "Beneficially Owns" and "Beneficially Owned" shall have correlative meanings. "Beneficiary" shall mean a beneficiary of the Trust as determined pursuant to Section 6.2(e). "Capital Stock" shall mean stock that is Common Stock, Excess Stock or Preferred Stock. "Constructive Ownership" shall mean ownership of Capital Stock by a Person who would be treated as an owner of such shares of Capital Stock either directly or indirectly through the application of Section 318 of the Code, as modified by Section 856(d)(5) of the Code. The terms "Constructive Owner," "Constructively Owns" and "Constructively Owned" shall have correlative meanings. "Equity Stock" shall mean stock that is either Common Stock or Preferred Stock. "Excess Stock" shall mean stock that is exchanged for Equity Stock pursuant to Section 6.1(c). "Market Price" on any date shall mean the average of the Closing Price for the five consecutive Trading Days ending on such date. The "Closing Price" on any date shall mean the last sale price, regular way, or, in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case as reported in the principal consolidated transaction reporting system with respect to securities listed or admitted to trading on the New York Stock Exchange or, if the Equity Stock is not listed or admitted to trading on the New York Stock Exchange, as reported in the principal consolidated transaction reporting system with respect to securities listed on the principal national securities exchange on which the Equity Stock is listed or admitted to trading or, if the Equity Stock is not listed or admitted to trading on any national securities exchange, the last quoted price, or if not so quoted, the average of the high bid and low asked prices in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated Quotation System or, if such system is no longer in use, the principal other automated quotations system that may then be in use or, if the Equity Stock is not quoted by any such organization, the average of the closing bid and asked prices as furnished by a professional market maker making a market in the Equity Stock selected by the Board. "Trading Day" shall mean a day on which the principal national securities exchange on which the Equity Stock is listed or admitted to trading is open for the transaction of business or, if the Equity Stock is not listed or admitted to trading on any national securities exchange, shall mean any day other than a Saturday, a Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close. "Ownership Limit" shall mean 9.9% of the value of the outstanding Equity Stock of the Corporation. 32 "Person" shall mean an individual, Corporation, partnership, estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside for or to be used exclusively for the purposes described in Section 642(c) of the Code, association, private foundation within the meaning of Section 509(a) of the Code, joint stock company or other entity. "Purported Beneficial Transferee" shall mean, with respect to any purported Transfer that results in Excess Stock, the purported beneficial transferee for whom the Purported Record Transferee would have acquired shares of Equity Stock if such Transfer had been valid under Section 6.1(b). "Purported Record Transferee" shall mean, with respect to any purported Transfer that results in Excess Stock, the record holder of the Equity Stock if such Transfer had been valid under Section 6.1(b). "Restriction Termination Date" shall mean the first day after the date hereof on which the Board and the stockholders of the Corporation determine that it is no longer in the best interests of the Corporation to attempt to, or continue to, qualify as a REIT. "Rights" shall mean the rights granted under the Operating Partnership Properties, L.P. Partnership Agreement to the limited partners to acquire Common Stock. "Operating Partnership Properties, L.P. Partnership Agreement" shall mean the agreement of limited partnership establishing Operating Partnership Properties, L.P., a California limited partnership. "Transfer" shall mean any sale, transfer, gift, hypothecation, pledge, assignment, devise or other disposition of Capital Stock (including (a) the granting of any option or entering into any agreement for the sale, transfer or other disposition of Equity Stock or (b) the sale, transfer, assignment or other disposition of any securities or rights convertible into or exchangeable for Capital Stock), whether voluntary or involuntary, whether of record, constructively or beneficially and whether by operation of law or otherwise. "Trust" shall mean the trust created pursuant to Section 6.2(a). "Trustee" shall mean the Corporation, acting as trustee for the Trust, or any successor trustee appointed by the Corporation. (b) Restriction on Transfers. (i) Except as provided in Section 6.1(i), from the date hereof and prior to the Restriction Termination Date, no Person shall Beneficially Own or Constructively Own shares of the outstanding Equity Stock in excess of the Ownership Limit. (ii) Except as provided in Section 6.1(i), from the date hereof and prior to the Restriction Termination Date, any Transfer that, if effective, would result in any Person Beneficially Owning or Constructively Owning Equity Stock in excess of the Ownership Limit shall be void ab initio as to the Transfer of that number of shares of Equity Stock which would be otherwise Beneficially Owned or Constructively Owned by such Person in excess of the Ownership Limit; and the intended transferee shall acquire no rights in such excess shares of Equity Stock. (iii) Except as provided in Section 6.1(i), from the date hereof and prior to the Restriction Termination Date, any Transfer that, if effective, would result in the Equity Stock's being 33 Beneficially Owned by fewer than 100 Persons (determined without reference to any rules of attribution) shall be void ab initio as to the Transfer of that number of shares which would be otherwise Beneficially Owned or Constructively Owned by the transferee; and the intended transferee shall acquire no rights in such excess shares of Equity Stock. (iv) From the date hereof and prior to the Restriction Termination Date, any Transfer of shares of Equity Stock that, if effective, would result in the Corporation's being "closely held" within the meaning of Section 856(h) of the Code shall be void ab initio as to the Transfer of that number of shares of Equity Stock which would cause the Corporation to be "closely held" within the meaning of Section 856(h) of the Code; and the intended transferee shall acquire no rights in such excess shares of Equity Stock. (c) Exchange for Excess Stock. (i) If, notwithstanding the other provisions contained in this Article VI, at any time after the date hereof and prior to the Restriction Termination Date, there is a purported Transfer or other change in the capital structure of the Corporation such that any Person would either Beneficially Own or Constructively Own Equity Stock in excess of the Ownership Limit, then, except as otherwise provided in Section 6.1(i), such shares of Equity Stock in excess of the Ownership Limit (rounded up to the nearest whole share) shall be automatically exchanged for an equal number of shares of Excess Stock. Such exchange shall be effective as of the close of business on the business day prior to the date of the Transfer or change in capital structure. (ii) If, notwithstanding the other provisions contained in this Article VI, at any time after the date hereof and prior to the Restriction Termination Date, there is a purported Transfer or other change in the capital structure of the Corporation which, if effective, would cause the Corporation to become "closely held" within the meaning of Section 856(h) of the Code, then the shares of Equity Stock being Transferred or which are otherwise affected by the change in capital structure and which, in either case, would cause the Corporation to be "closely held" within the meaning of Section 856(h) of the Code (rounded up to the nearest whole share) shall be automatically exchanged for an equal number of shares of Excess Stock. Such exchange shall be effective as of the close of business on the business day prior to the date of the Transfer or change in capital structure. (d) Remedies for Breach. If the Board or its designees at any time determines in good faith that a Transfer has taken place in violation of Section 6.1(b) or that a Person intends to acquire or has attempted to acquire Beneficial Ownership or Constructive Ownership of any shares of Equity Stock in violation of Section 6.1(b), the Board or its designees shall take such action as it or they deem advisable to refuse to give effect to or to prevent such Transfer, including, but not limited to, refusing to give effect to such Transfer on the books of the Corporation or instituting proceedings to enjoin such Transfer; provided, however, that any Transfers or attempted Transfers in violation of Section 6.1(b) shall be void ab initio and automatically result in the exchange described in Section 6.1(c), irrespective of any action (or non-action) by the Board or its designees. (e) Notice of Restricted Transfer. Any Person who acquires or attempts to acquire shares of Equity Stock in violation of Section 6.1(b), or any Person who is a transferee such that Excess Stock results under Section 6.1(c), shall immediately give written notice to the Corporation of such event and shall provide to the Corporation such other information as the Corporation may request in order to determine the effect, if any, of such Transfer or attempted Transfer on the Corporation's status as a REIT. 34 (f) Owners Required to Provide Information. From the date hereof and prior to the Restriction Termination Date: (i) Every Beneficial Owner or Constructive Owner of more than 5% (during any periods in which the number of such Persons exceeds 2000) or 1% (during any periods in which the number of such Persons is greater than 200 but no more than 1999), or such lower percentages as required pursuant to regulations under the Code, of the outstanding Equity Stock of the Corporation shall, within 30 days after January 1 of each year, give written notice to the Corporation stating the name and address of such Beneficial Owner or Constructive Owner, the number of shares of Equity Stock Beneficially Owned or Constructively Owned, and a description of how such shares are held. Each such Beneficial Owner or Constructive Owner shall provide to the Corporation such additional information as the Corporation may request in order to determine the effect, if any, of such Beneficial Ownership on the Corporation's status as a REIT and to ensure compliance with the Ownership Limit and existing holder limit. (ii) Each Person who is a Beneficial Owner or Constructive Owner of Equity Stock and each Person (including the stockholder of record) who is holding Equity Stock for a Beneficial Owner or Constructive Owner shall provide to the Corporation such information as the Corporation may request in order to determine the Corporation's status as a REIT and to ensure compliance with the Ownership Limited. (g) Remedies Not Limited. Nothing contained in this Article VI shall limit the authority of the Board to take such other action as it deems necessary or advisable to protect the Corporation and the interests of its stockholders by preservation of the Corporation's status as a REIT and to ensure compliance with the Ownership Limit. (h) Ambiguity. In the case of an ambiguity in the application of any of the provisions of this Section 6.1, including any definition contained in Section 6.1(a), the Board shall have the power to determine the application of the provisions of this Section 6.1 with respect to any situation based on the facts known to it. (i) Exception. The Board, upon receipt of a ruling from the Internal Revenue Service or an opinion of counsel in each case to the effect that the restrictions contained in Section 6.1(b)(iii) and/or Section 6.1(b)(iv) will not be violated, may exempt (i) a Person from the Ownership Limit if such Person is not an individual for purposes of Section 542(a)(2) of the Code (as modified by Section 856(h) of the Code) or (ii) is an underwriter which participates in a public offering of the Equity Stock for a period of 90 days following the purchase by such underwriter of the Equity Stock and the Board obtains such representations and undertakings from such Person as are reasonably necessary to ascertain that no individual's Beneficial Ownership of Equity Stock will violate the Ownership Limit and such Person agrees that any violation or attempted violation will result in such Equity Stock being exchanged for Excess Stock in accordance with Section 6.1(c) and provided that any exemption of a Person under clause (i) of this Section 6.1(i) shall not allow the Person to exceed 13.0% of the value of the outstanding Equity Stock of the Corporation. (j) Legend. Each certificate for Equity Stock shall bear the following legend: "The shares of [____________] Stock represented by this certificate are subject to restrictions on transfer for the purpose of the Corporation's maintenance of its status as a real estate investment trust under the Internal Revenue Code of 1986, as amended (the "Code"). No Person may (1) Beneficially Own or Constructively Own shares of Equity Stock in excess of 9.9% of the value of the outstanding Equity Stock of the Corporation; or (2) Beneficially Own Equity Stock that would 35 result in the Corporation's being "closely held" under Section 856(h) of the Code. Any Person who attempts to Beneficially Own or Constructively Own shares of Equity Stock in excess of the above limitations must immediately notify the Corporation. All capitalized terms in this legend have the meanings defined in this Charter, as the same may be further amended from time to time, a copy of which, including the restrictions on transfer, will be sent without charge to each stockholder who so requests. If the restrictions on transfer are violated, the shares of Equity Stock represented hereby will be automatically exchanged for shares of Excess Stock which will be held in trust by the Corporation." Section 6.2 Excess Stock. (a) Ownership in Trust. Upon any purported Transfer that results in Excess Stock pursuant to Section 6.1(c), such Excess Stock shall be deemed to have been transferred to the Corporation, as Trustee of a Trust for the exclusive benefit of such Beneficiary or Beneficiaries to whom an interest in such Excess Stock may later be transferred pursuant to Section 6.2(e). Shares of Excess Stock so held in trust shall be issued and outstanding stock of the Corporation. The Purported Record Transferee shall have no rights in such Excess Stock except the right to receive a price for its interest in the shares of Equity Stock which were exchanged for Excess Stock. The Purported Beneficial Transferee shall have no rights in such Excess Stock except as provided in Section 6.2(e). (b) Dividend Rights. Excess Stock shall not be entitled to any dividends. Any dividend or distribution paid prior to the discovery by the Corporation that the shares of Equity Stock have been exchanged for Excess Stock shall be repaid to the Corporation upon demand, and any dividend or distribution declared but unpaid shall be rescinded as void ab initio with respect to such shares of Equity Stock. (c) Rights upon Liquidation. In the event of any voluntary or involuntary liquidation, dissolution, or winding up of, or any distribution of the assets of, the Corporation, the shares of Excess Stock shall not be entitled to share in any portion of the assets of the Corporation. At such time as (i) the Corporation has received the necessary stockholder approval with respect to a voluntary liquidation or dissolution of the Corporation, or (ii) the Corporation has become the subject of an order of a court of competent jurisdiction compelling an involuntary liquidation or dissolution of the Corporation, such shares of Excess Stock held in Trust shall without further act be extinguished and each Purported Beneficial Transferee whose acquisition of Equity Stock resulted in the Excess Stock which has been extinguished pursuant to this Section 6.2(c) shall without further act become a creditor of the Corporation. The amount by which each such Purported Beneficial Transferee shall become a creditor of the Corporation with respect to its now-extinguished interest in the Trust (representing the number of shares of Excess Stock held by the Trust attributable to a purported Transfer that resulted in the Excess Stock) will be equal to the lesser of (i) that amount of the distributable assets of the Corporation to which such Excess Stock would be entitled if such Excess Stock were entitled to share ratably in the distributable assets of the Corporation as shares of Common Stock, or (ii) as appropriate, either (A) the price per share paid by such Purported Beneficial Transferee for the shares of Equity Stock which were exchanged for Excess Stock, or (B) if the Purported Beneficial Transferee did not give value for such shares of Equity Stock (having received such through a gift, device or otherwise), a price per share equal to the Market Price on the date of the purported Transfer that resulted in the Excess Stock. Payment to the Purported Beneficial Transferee shall be without interest and shall be due concurrently with the date of first distribution of liquidation proceeds to the holders of Equity Stock. If the Corporation causes such liquidation or dissolution to be revoked or otherwise rescinded any Excess Stock previously automatically extinguished pursuant to this Section 6.2(c) shall be automatically revived and any Purported Beneficial Transferees shall without further act cease to be creditors of the Corporation as otherwise provided above. 36 (d) Voting Rights. The holders of shares of Excess Stock shall not be entitled to vote on any matters (except as required by the general laws of the State of Maryland). (e) Restrictions on Transfer; Designation of Beneficiary. (i) Excess Stock shall not be transferable. The Corporation may designate a Beneficiary of an interest in the Trust (representing the number of shares of Excess Stock held by the Trust attributable to a purported Transfer that resulted in the Excess Stock), if the shares of Excess Stock held in the Trust would not be Excess Stock in the hands of such Beneficiary. The Purported Beneficial Transferee may receive a price for its interest in the shares of Equity Stock which were exchanged for Excess Stock provided that the Purported Beneficial Transferee does not receive a price for such Excess Stock that exceeds (A) the price per share such Purported Beneficial Transferee paid for the Equity Stock in the purported Transfer that resulted in the Excess Stock, or (B) if the Purported Beneficial Transferee did not give value for such shares of Excess Stock (through a gift, devise or otherwise), a price per share equal to the Market Price on the date of the purported Transfer that resulted in the Excess Stock. Upon such transfer of an interest in the Trust, the corresponding shares of Excess Stock in the Trust shall be automatically exchanged for an equal number of shares of Equity Stock, and such shares of Equity Stock shall be transferred of record to the Beneficiary of the interest in the Trust designated by the Corporation as described above if such Equity Stock would not be Excess Stock in the hands of such Beneficiary. (ii) Notwithstanding the foregoing, if a Purported Beneficial Transferee receives a price for its interest in the shares of Equity Stock which were exchanged for Excess Stock that exceeds the amounts allowable under Section 6.2(e)(i), such Purported Beneficial Transferee shall pay, or cause to be paid, such excess to the Corporation, or, at the Corporation's sole election, such excess shall be offset against any future dividends or distributions payable to such Purported Beneficial Transferee. (f) Purchase Right in Excess Stock. Shares of Excess Stock shall be deemed to have been offered for sale to the Corporation, or its designee at a price per share equal to the lesser of (i) the price per share in the transaction that created such Excess Stock (or, in the case of devise or gift, the Market Price at the time of such devise or gift) and (ii) the Market Price on the date the Corporation, or its designee, accepts such offer. Subject to the satisfaction of any applicable requirements of the general laws of the State of Maryland, the Corporation shall have the right to accept such offer for a period of ninety days after the later of (i) the date of the Transfer that resulted in such Excess Stock and (ii) the date the Board determines in good faith that a Transfer resulting in Excess Stock has occurred, if the Corporation does not receive a notice of such Transfer pursuant to Section 6.1(e). Section 6.3 Further Authority. Nothing contained in this Article VI or in any other provision of this Charter shall limit the authority of the Board to take such other action as it in its sole discretion deems necessary or advisable to protect the Corporation and the interests of the stockholders by maintaining the Corporation's eligibility to be, and preserving the Corporation's status as, a qualified REIT under the Code. Section 6.4 New York Stock Exchange. Nothing in this Article VI precludes the settlement of transactions entered into through the facilities of the New York Stock Exchange. As provided in this Article VI, under certain circumstances, a Transfer of Equity Stock may result in the automatic exchange of the Equity Stock being transferred for an equal number of shares of Excess Stock. 37 ARTICLE VII PROVISIONS FOR DEFINING, LIMITING AND REGULATING CERTAIN POWERS OF THE CORPORATION AND OF THE STOCKHOLDERS AND DIRECTORS Section 7.1 Number and Term of Directors. The business and affairs of the Corporation shall be managed by or under the direction of the Board. The Board may take any action that, in its sole judgment and discretion, is necessary or desirable to conduct the business of the Company. This Charter shall be construed with a presumption in favor of the grant of power and authority to the Board. Any construction of this Charter or determination made in good faith by the Board concerning its powers and authority hereunder shall be conclusive. The number of directors of the Corporation initially shall be ten, which number may be increased or decreased pursuant to the Bylaws, but shall never be less than the minimum number required by the Maryland General Corporation Law. The names of the initial directors are as follows: Robert P. Freeman, Jon A. Grove, James D. Klingbeil, Robert C. Larson, John P. McCann, Thomas R. Oliver, Lynne B. Sagalyn, Mark J. Sandler, Robert W. Scharar and Thomas W. Toomey. A director shall hold office until the next annual meeting of stockholders and until his or her successor is elected and qualified, subject, however, to prior death, resignation, retirement, disqualification or removal from office. Subject to the rights of the holders of any series of Preferred Stock then outstanding, newly created directorships resulting from any increase in the authorized number of directors and any vacancies on the Board resulting from death, resignation, retirement, disqualification, removal from office or other cause shall be filled only by a majority vote of the remaining directors then in office though less than a quorum. No decrease in the number of directors constituting the Board shall cause the removal or shorten the term of any incumbent director. Section 7.2 Removal of Directors. Subject to the rights of one or more classes or series of Preferred Stock to elect or remove one or more directors, any director or the entire Board may be removed from office at any time, with or without cause, only at a meeting of the stockholders called for such purpose, by the affirmative vote of the holders of a majority of the outstanding shares entitled to vote, voting as a class, in the election of directors. The notice of such meeting shall indicate that the purpose or one of the purposes of such meeting is to determine if a director should be removed. Section 7.3 Board Powers and Determinations. The Board shall, consistent with applicable law, have power in its sole discretion to determine whether and to what extent and at what times and places and under what conditions and regulations the books, accounts and documents of the Corporation, or any of them, will be open to the inspection of stockholders, except as otherwise provided by statute or by the Bylaws, and, except as so provided, no stockholder shall have any right to inspect any book, account or document of the Corporation unless authorized so to do by resolution of the Board. The determination as to any of the following matters, made in good faith by or pursuant to the direction of the Board consistent with this Charter and in the absence of actual receipt of an improper benefit in money, property or services or active and deliberate dishonesty established by a court, shall be final and conclusive and shall be binding upon the Corporation and every holder of shares of its stock: the amount of the net income of the Corporation for any period and the amount of assets at any time legally available for the payment of dividends, redemption of its stock or the payment of other distributions on its stock; the amount of paid-in surplus, net assets, other surplus, annual or other net profit, net assets in excess of capital, undivided profits or excess of profits over losses on sales of assets; the amount, purpose, time of creation, increase or decrease, alteration or cancellation of any reserves or charges and the propriety thereof (whether or not any obligation or liability for which such reserves or charges shall have been created shall have been paid or discharged); the fair value, or any sale, bid or asked price to be applied in determining the fair value, of any asset owned or held by the Corporation; any matters relating to the acquisition, holding and disposition of any assets by the Corporation; and any other matter relating to the business and affairs of the Corporation. 38 Section 7.4 Limitation of Liability and Indemnification. To the fullest extent permitted by Maryland statutory or decisional law, as the same may from time to time be amended or interpreted, no director or officer of the Corporation shall be personally liable to the Corporation, any subsidiary thereof or any of its stockholders for money damages. The Corporation shall indemnify (a) its directors and officers, whether serving the Corporation or, at its request, any other entity, to the full extent required or permitted by the general laws of the State of Maryland now or hereafter in force, including the advancement of expenses under the procedures and to the full extent permitted by law, and (b) other employees and agents, whether serving the Corporation or, at its request, any other entity, to such extent as may be authorized by the Board or the Bylaws and as permitted by law. The foregoing rights of indemnification shall not be exclusive of any other rights to which those seeking indemnification may be entitled. The Board may take such action as is necessary to carry out these indemnification provisions and is expressly empowered to adopt, approve and amend from time to time such Bylaws, resolutions or contracts implementing such provisions or such further indemnification arrangements as may be permitted by law. No amendment of this Charter or repeal of any of its provisions shall limit or eliminate the foregoing limitation of liability or right to indemnification provided hereunder with respect to acts or omissions occurring prior to such amendment or repeal. ARTICLE VIII AMENDMENTS Section 8.1 Bylaws. The Board shall have the exclusive power to adopt, amend or repeal the Bylaws for the Corporation in accordance with the terms of the Bylaws. Section 8.2 Charter. The Corporation reserves the right from time to time to make any amendment now or hereafter authorized by law, including any amendment altering the terms or contract rights, as expressly set forth in this Charter, of any shares of outstanding stock. All rights and powers conferred by this Charter on stockholders, directors and officers of the Corporation are granted subject to this reservation. This Charter may be amended (a) by a majority of the entire Board, without any action by the stockholders, to the extent permitted by Maryland law, (i) to change the name of the Corporation, (ii) to change the name or other designation or the par value of any class or series of stock of the Corporation and the aggregate par value of the stock of the Corporation or (iii) as contemplated by Section 5.1 of this Charter or (b) by the affirmative vote of the holders of a majority of the shares of stock then outstanding and entitled to vote thereon. Section 8.3 Provisions in Conflict with Law or Regulations. (a) The provisions of this Charter are severable, and if the Board determines that any one or more of such provisions are in conflict with the Corporation's desire to maintain its status as a real estate investment trust under the Code, or other applicable federal or state laws, the conflicting provisions shall be deemed never to have constituted a part of this Charter, even without any amendment of this Charter pursuant to Section 8.2 hereof; provided, however, that such determination by the Board shall not affect or impair any of the remaining provisions of this Charter or render invalid or improper any action taken or omitted prior to such determination. No Director shall be liable for making or failing to make such a determination. (b) If any provision of this Charter or any application of such provision is held invalid or unenforceable by any federal or state court having jurisdiction, such holding shall not in any manner affect or render invalid or unenforceable such provision in any other jurisdiction, and the validity of the remaining provisions of this Charter shall not be affected. Other applications of such provision shall be affected only to the extent necessary to comply with the determination of such court. 39 EX-2.02 4 d06673exv2w02.txt EX-2.02 ARTICLES OF MERGER Exhibit 2.02 ARTICLES OF MERGER UNITED DOMINION REALTY TRUST, INC., A VIRGINIA CORPORATION AND UDRT MARYLAND, INC., A MARYLAND CORPORATION The undersigned corporations, pursuant to Title 13.1, Chapter 9, Article 12 of the Code of Virginia, hereby execute the following articles of merger and set forth: ONE United Dominion Realty Trust, Inc. ("UDRT Virginia") shall be merged into UDRT Maryland, Inc. ("UDRT Maryland") pursuant to the Agreement and Plan of Merger attached hereto as Exhibit A (the "Plan of Merger"). TWO (1) The Plan of Merger was submitted to the shareholders of UDRT Virginia by the board of directors of UDRT Virginia in accordance with the provisions of Chapter 9 of Title 13.1 of the Code of Virginia, and: (a) The designation, number of outstanding shares, and number of votes entitled to be cast by each voting group entitled to vote separately on the Plan of Merger were:

Designation No. of Outstanding Shares No. of Votes Common Stock 108,827,959 102,508,685

(b) The total number of votes cast for and against the Plan of Merger by each voting group entitled to vote separately on the plan was:

Voting Group Total No. of Votes Cast Total No. of Votes Cast FOR the Plan of Merger AGAINST the Plan of Merger Common Stock 74,134,384 3,209,386

(c) And the number cast for the Plan of Merger by each voting group was sufficient for approval by that voting group. (2) The Plan of Merger was submitted to the sole stockholder of UDRT Maryland by the board of directors of UDRT Maryland in accordance with the provisions of Chapter 9 of Title 13.1 of the Code of Virginia, and approved and adopted by the written consent of the sole stockholder. The undersigned officers declare that the facts herein stated are true as of June 11, 2003. United Dominion Realty Trust, Inc. By: /s/ Mary Ellen Norwood -------------------------------- Mary Ellen Norwood Vice President and Secretary UDRT Maryland, Inc. By: /s/ Warren L. Troupe -------------------------------- Warren L. Troupe President 2 EXHIBIT A AGREEMENT AND PLAN OF MERGER This Agreement and Plan of Merger (this "Agreement"), dated as of June 11, 2003, is by and between United Dominion Realty Trust, Inc., a Virginia corporation ("UDRT") and UDRT Maryland, Inc., a Maryland corporation and a wholly owned subsidiary of UDRT ("UDRT Maryland"). WITNESSETH: WHEREAS, UDRT is a corporation duly formed under the laws of the Commonwealth of Virginia; WHEREAS, UDRT Maryland is a corporation duly formed under the laws of the State of Maryland; and WHEREAS, the board of directors and shareholders of UDRT and the board of directors and sole shareholder of UDRT Maryland each deems it desirable, upon the terms and subject to the conditions of this Agreement, that UDRT be merged with and into UDRT Maryland and that UDRT Maryland be the surviving entity. NOW, THEREFORE, the parties agree as follows: ARTICLE I THE MERGER Section 1.01. THE MERGER. Upon the terms and subject to the conditions set forth in this Agreement and in accordance with the laws of the Commonwealth of Virginia and the State of Maryland, UDRT shall be merged with and into UDRT Maryland (the "Merger"). As a result of the Merger, the identity and separate existence of UDRT shall cease and UDRT Maryland, Inc. shall continue as the surviving entity of the Merger (sometimes referred to herein as the "Surviving Corporation"). In connection with the Merger, the name of UDRT Maryland, Inc. will be changed to United Dominion Realty Trust, Inc. Section 1.02. EFFECTIVE TIME. The parties shall cause the Merger to be consummated by filing articles of merger with the State Corporation Commission of the Commonwealth of Virginia and the State Department of Assessments and Taxation of the State of Maryland, as required by, and executed in accordance with the relevant laws of the Commonwealth of Virginia and the State of Maryland, all to be effective as of the time of acceptance of the Articles of Merger by the State Corporation Commission of the Commonwealth of Virginia and the State Department of Assessments and Taxation of the State of Maryland (the "Effective Time"). Section 1.03. EFFECT OF THE MERGER. At the Effective Time, the effect of the Merger shall be as provided under the laws of the Commonwealth of Virginia and the State of Maryland. Without limiting the generality of the foregoing, and subject thereto, at the Effective Time, all the rights, privileges, powers and franchises of UDRT, shall vest in the Surviving Corporation, 3 and all debts, liabilities and duties of UDRT shall become the debts, liabilities and duties of the Surviving Corporation. Section 1.04. SUBSEQUENT ACTIONS. If, at any time after the Effective Time, the Surviving Corporation shall consider or be advised that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to continue in, vest, perfect or confirm of record or otherwise in the Surviving Corporation its right, title or interest in, to or under any of the rights, properties, privileges, franchises or assets of UDRT acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger or otherwise to carry out this Agreement, the proper officers of the Surviving Corporation shall be and hereby are directed and authorized to execute and deliver, in the name and on behalf of UDRT, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of UDRT or otherwise, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties, privileges, franchises or assets in the Surviving Corporation or otherwise to carry out this Agreement. ARTICLE II CONVERSION OF SHARES At the Effective Time, by virtue of the Merger and without any action on the part of UDRT or UDRT Maryland, each share of the outstanding capital stock of UDRT shall be exchanged for one share of the outstanding capital stock of UDRT Maryland. ARTICLE III GOVERNING LAW This Agreement shall be construed in accordance with and governed by the laws of the State of Maryland, without giving effect to principles of conflicts of laws. [Remainder of page intentionally left blank, signature page to follow.] 4 IN WITNESS WHEREOF, UDRT and UDRT Maryland have each caused this Agreement to be duly executed under seal, all as of the date first above written. UNITED DOMINION REALTY TRUST, INC., a Virginia corporation By: /s/ Mary Ellen Norwood ------------------------------------------------ Mary Ellen Norwood Vice President and Secretary UDRT MARYLAND, INC., a Maryland corporation By: /s/ Warren L. Troupe ------------------------------------------------ Warren L. Troupe President 5 EX-3.02 5 d06673exv3w02.txt EX-3.02 BYLAWS Exhibit 3.02 BYLAWS OF UNITED DOMINION REALTY TRUST, INC. A MARYLAND CORPORATION TABLE OF CONTENTS ARTICLE I OFFICES............................................................................... 1 Section 1.1 Principal Office in Maryland and Resident Agent................................... 1 Section 1.2 Other Offices..................................................................... 1 ARTICLE II STOCKHOLDERS' MEETINGS................................................................ 1 Section 2.1 Place of Meetings................................................................. 1 Section 2.2 Annual Meetings................................................................... 2 Section 2.3 Special Meetings.................................................................. 2 Section 2.4 Notice of Meetings................................................................ 2 Section 2.5 Record Date....................................................................... 3 Section 2.6 Quorum and Voting................................................................. 4 Section 2.7 Right to Vote; Proxies............................................................ 4 Section 2.8 Voting of Shares by Certain Holders............................................... 5 Section 2.9 Inspectors........................................................................ 6 Section 2.10 Action Without Meetings........................................................... 6 Section 2.11 Voting by Ballot.................................................................. 6 ARTICLE III DIRECTORS............................................................................. 7 Section 3.1 Number and Term of Office......................................................... 7 Section 3.2 Powers............................................................................ 7 Section 3.3 Vacancies......................................................................... 7 Section 3.4 Resignations and Removals......................................................... 7 Section 3.5 Meetings.......................................................................... 8 Section 3.6 Quorum and Voting................................................................. 8 Section 3.7 Action Without Meeting............................................................ 9 Section 3.8 Fees and Compensation............................................................. 9 Section 3.9 Presumption of Assent............................................................. 9 Section 3.10 Committees........................................................................ 9 ARTICLE IV OFFICERS.............................................................................. 10 Section 4.1 Officers Designated............................................................... 10 Section 4.2 Tenure and Duties of Officers..................................................... 11 - ii - ARTICLE V EXECUTION OF CORPORATE INSTRUMENTS AND VOTING OF SECURITIES OWNED BY THE CORPORATION.. 12 Section 5.1 Execution of Corporate Instruments................................................ 12 Section 5.2 Voting of Securities Owned by Corporation......................................... 12 ARTICLE VI SHARES OF STOCK....................................................................... 12 Section 6.1 Certificates...................................................................... 12 Section 6.2 Transfers......................................................................... 13 Section 6.3 Replacement Certificate........................................................... 13 Section 6.4 Stock Ledger...................................................................... 14 Section 6.5 Issuance of Units................................................................. 14 Section 6.6 Fractional Share Interests or Scrip............................................... 14 Section 6.7 Dividends......................................................................... 14 ARTICLE VII EXEMPTION FROM CONTROL SHARE ACQUISITION ACT.......................................... 15 ARTICLE VIII OTHER SECURITIES OF THE CORPORATION................................................... 15 ARTICLE IX CORPORATE SEAL........................................................................ 15 ARTICLE X FISCAL YEAR........................................................................... 15 ARTICLE XI INDEMNIFICATION....................................................................... 16 Section 11.1 Right to Indemnification.......................................................... 16 Section 11.2 Provisions Nonexclusive........................................................... 16 Section 11.3 Authority to Insure............................................................... 16 Section 11.4 Survival of Rights................................................................ 16 Section 11.5 Subrogation....................................................................... 17 Section 11.6 No Duplication of Payments........................................................ 17 - iii - BYLAWS OF UNITED DOMINION REALTY TRUST, INC. ARTICLE I OFFICES SECTION 1.1 PRINCIPAL OFFICE IN MARYLAND AND RESIDENT AGENT. The address of the principal office of the corporation in the State of Maryland is 300 E. Lombard Street, Baltimore, Maryland 21202. The name and address of the resident agent in the State of Maryland is The Corporation Trust Incorporated, a Maryland corporation, 300 E. Lombard Street, Baltimore, Maryland 21202. SECTION 1.2 OTHER OFFICES. The corporation may also have and maintain such other offices or places of business, both within and outside the State of Maryland as the Board of Directors may from time to time determine or the business of the corporation may require. ARTICLE II STOCKHOLDERS' MEETINGS SECTION 2.1 PLACE OF MEETINGS. (a) Meetings of stockholders may be held at such place, either within or outside the State of Maryland, as may be designated by or in the manner provided in these Bylaws or, if not so designated, as determined by the Board of Directors. The Board of Directors may, in its sole discretion, determine that the meeting may not be held at any place, but may instead be held solely by means of remote communication as authorized by paragraph (b) of this Section 2.1. (b) If authorized by the Board of Directors in its sole discretion, and subject to such guidelines and procedures as the Board of Directors may adopt, stockholders and proxyholders not physically present at a meeting of stockholders may, by means of remote communication: (i) Participate in a meeting of stockholders; and (ii) Be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated place or solely by means of remote communication, provided that the corporation (A) implements reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (B) implements reasonable measures to provide 1 such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, and (C) maintains a record of any vote or action by any stockholder or proxyholder at the meeting by means of remote communication. (c) "Remote communication" means a conference telephone or similar communications equipment provided that all persons participating in the meeting can hear each other at the same time. SECTION 2.2 ANNUAL MEETINGS. The annual meetings of the stockholders of the corporation, for the purpose of election of directors and for such other business as may lawfully come before it, shall be held on such date and at such time the Board of Directors designates from time to time. Failure to hold an annual meeting does not invalidate the corporation's existence or affect any otherwise valid corporate act. SECTION 2.3 SPECIAL MEETINGS. Special meetings of the stockholders of the corporation may be called, for any purpose or purposes, by the Chairman of the Board of Directors or the President or the Board of Directors at any time. Upon written request of any stockholder or stockholders entitled to cast at least ten percent (10%) of all the votes entitled to be cast at the meeting, if such request states the purpose of the meeting and the matters proposed to be acted on at it, delivered in person or sent by registered mail to the Chairman of the Board of Directors, President or Secretary of the corporation, the Secretary shall inform the stockholders who make the request of the reasonably estimated cost of preparing and mailing a notice of the meeting and on payment of these costs to the corporation, notify each stockholder entitled to notice of the meeting. The Board of Directors has the sole power to fix the record date for determining stockholders entitled to request a special meeting of the stockholders, the record date for determining stockholders entitled to notice of and to vote at the special meeting and the date, time and place of the special meeting. SECTION 2.4 NOTICE OF MEETINGS. (a) Except as otherwise provided by law or in the Articles of Incorporation, written notice of each meeting of stockholders, specifying the place, if any, date and hour and, in the case of a special meeting or as otherwise may be required by law, purpose or purposes of the meeting, and the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such meeting, shall be given by the Secretary of the Corporation not less than ten (10) nor more than ninety (90) days before the date of the meeting to each stockholder entitled to vote thereat, directed to his or her address as it appears upon the books of the corporation. No business shall be transacted at a special meeting of stockholders except as specifically designated in the notice. (b) When a meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time, place, if any, thereof, and the means of remote communication, if any, by which stockholders and proxyholders may be deemed to be present in person and vote at such adjourned meeting, are announced at the meeting at which the 2 adjournment is taken unless the adjournment is for more than one hundred twenty (120) days after the original record date, or unless after the adjournment a new record date is fixed for the adjourned meeting, in which event a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting. (c) Notice of the time, place and purpose of any meeting of stockholders may be waived in writing, either before or after such meeting, and, to the extent permitted by law, will be waived by any stockholder by his or her attendance thereat, in person or by proxy. Any stockholder so waiving notice of such meeting shall be bound by the proceedings of any such meeting in all respects as if due notice thereof had been given. (d) Without limiting the manner by which notice otherwise may be given effectively to stockholders, any notice to stockholders given by the corporation under any provision of Maryland General Corporation Law, the Articles of Incorporation or these Bylaws shall be effective when it is (i) personally delivered to the stockholder, (ii) left at the stockholder's residence or usual place of business, (iii) mailed to the stockholder at the stockholder's address as it appears on the records of the corporation or (iv) if consented to by such stockholder, transmitted to the stockholder by electronic mail to any electronic mail address of the stockholder or by any other electronic means. Any such consent shall be revocable by the stockholder by written notice to the corporation. Any such consent shall be deemed revoked if (i) the corporation is unable to deliver by electronic mail or other means two consecutive notices given by the corporation in accordance with such consent, and (ii) such inability becomes known to the Secretary or an assistant secretary of the corporation or to the transfer agent or other person responsible for the giving of notice; provided, however, the inadvertent failure to treat such inability as a revocation shall not invalidate any meeting or other action. An affidavit of the Secretary or an assistant secretary or of the transfer agent or other agent of the corporation that the notice has been given by a form of electronic mail or other means shall, in the absence of fraud, be prima facie evidence of the facts stated therein. For purposes of these Bylaws, "electronic mail" or "electronic means" means any form of communication, not directly involving the physical transmission of paper, that creates a record that may be retained, retrieved and reviewed by a recipient thereof, and that may be directly reproduced in paper form by such a recipient through an automated process. SECTION 2.5 RECORD DATE. For purposes of determining the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment thereof, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion or exchange of stock or for the purpose of any other lawful action, the Board of Directors may (a) fix, in advance, a record date which shall not be more than ninety (90) days prior to the date of any such meeting or the taking of such other actions; or (b) direct that the stock transfer books be closed for a period not to exceed twenty (20) days. A record date may not precede the date on which the record date is fixed. In the case of a meeting of stockholders, the record date or the closing of the transfer books shall be at least ten (10) days before the meeting. A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting. Except where the Board of 3 Directors fixes a new record date for any adjourned meeting, any stockholder who was a stockholder on the original record date shall be entitled to receive notice of and to vote at a meeting of stockholders or any adjournment thereof and to receive a dividend or allotment of rights even though he or she has since such date disposed of his or her shares, and no stockholder becoming a stockholder after such date shall be entitled to receive notice of or to vote at such meeting or any adjournment thereof or to receive such dividend or allotment of rights. If the Board of Directors does not so fix a record date or close the stock transfer books, then: (a) The record date for determining stockholders entitled to notice of or to vote at a meeting of stockholders shall be the later of (i) at the close or business on the day on which notice is mailed or (ii) at the close of business on the thirtieth (30th) day next preceding the day on which the meeting is held. (b) The record date for determining stockholders for any other purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto provided that the payment of a dividend or allotment of rights may not be made more than sixty (60) days after the date on which such resolution was adopted. SECTION 2.6 QUORUM AND VOTING. (a) At all meetings of stockholders except where otherwise provided by law, the Articles of Incorporation or these Bylaws, the presence, in person or by proxy duly authorized, of the holders of a majority of all the votes entitled to be cast at the meeting shall constitute a quorum for the transaction of business. Shares, the voting of which at said meeting have been enjoined, or which for any reason cannot be lawfully voted at such meeting, shall not be counted to determine a quorum at said meeting. In the absence of a quorum, any meeting of stockholders may be adjourned, from time to time, by vote of the holders of a majority of the shares represented thereat, but no other business shall be transacted at such meeting. At such adjourned meeting at which a quorum is present or represented, any business may be transacted that might have been transacted at the original meeting. (b) Except as otherwise provided by law, the Articles of Incorporation or these Bylaws, a majority of all the votes cast at a meeting at which a quorum is present is sufficient to approve any matter that properly comes before the meeting, except that a plurality of all the votes cast at a meeting at which a quorum is present is sufficient to elect a director. (c) Except as otherwise provided by law or the Articles of Incorporation, where a separate vote by a class or classes is required, a majority of the outstanding shares of such class or classes present in person or represented by proxy shall constitute a quorum entitled to take action with respect to that vote on that matter, and the affirmative vote of the majority of shares of such class or classes present in person or represented by proxy at the meeting shall be the act of such class. SECTION 2.7 RIGHT TO VOTE; PROXIES. 4 Unless the Articles of Incorporation provide for a greater or lesser number of votes per share or limit or deny voting rights, each outstanding share of stock, regardless of class, is entitled to one vote on each matter submitted to a vote at a meeting of stockholders. A stockholder may cast the votes entitled to be cast by the shares of the corporation owned of record by him or her, either in person or by proxy in any manner authorized by law, by the stockholder or by his or her duly authorized attorney in fact. Such proxy shall be filed with the Secretary before or at the time of the meeting. A stockholder may authorize another person to act as proxy by transmitting, or authorizing the transmission of, an authorization by telegram, cablegram, datagram, electronic mail or any other electronic or telephonic means to the person authorized to act as proxy or to any other person authorized to receive the proxy authorization on behalf of the person authorized to act as proxy, including a proxy solicitation firm or proxy support service organization. No proxy shall be valid after eleven (11) months from the date of its execution, unless otherwise provided in the proxy. A proxy is revocable by a stockholder at any time without condition or qualification unless the proxy states that it is irrevocable and the proxy is coupled with an interest. A proxy may be made irrevocable for so long as it is coupled with an interest. The interest with which a proxy may be coupled includes an interest in the stock to be voted under the proxy or another general interest in the corporation or its assets or liabilities. SECTION 2.8 VOTING OF SHARES BY CERTAIN HOLDERS. (a) Shares registered in the name of a corporation, partnership, trust or other entity, if entitled to be voted, may be voted by the president or a vice president, a general partner or trustee thereof, as the case may be, or a proxy appointed by any of the foregoing individuals, unless some other person who has been appointed to vote such shares pursuant to a bylaw or a resolution of the governing body of such corporation or other entity or agreement of the partners of a partnership presents a certified copy of such bylaw, resolution or agreement, in which case such person may vote such shares. Any director or other fiduciary may vote shares registered in his or her name as such fiduciary, either in person or by proxy. (b) Shares registered in the name of a person adjudged incompetent may be voted and all rights incident thereto may be exercised only by his or her guardian, in person or by proxy. Shares registered in the name of a deceased person may be voted and all rights incident thereto may be exercised only by his or her executor or administrator, in person or by proxy. Shares registered in the name of a minor may be voted and all rights incident thereto may be exercised by his or her guardian, in person or by proxy, or in the absence of such representation by his or her guardian, by the minor, in person or by proxy, whether or not the corporation has notice, actual or constructive, of the minority or the appointment of a guardian, and whether or not a guardian has in fact been appointed. (c) Shares registered in the names of two or more persons shall be voted or represented in accordance with the vote or consent of the majority of the persons in whose names the shares stand. If only one such person is present in person or by proxy, he or she may vote all the shares, and all the shares standing in the names of such persons are represented for the purpose of determining a quorum. This procedure also applies to the voting of shares by two or more administrators, executors, trustees or other fiduciaries, unless the instrument or order of court appointing them otherwise directs. 5 (d) Shares of the corporation directly or indirectly owned by it shall not be voted at any meeting and shall not be counted in determining the total number of outstanding shares entitled to be voted at any given time, unless they are held by it in a fiduciary capacity, in which case they may be voted and shall be counted in determining the total number of outstanding shares at any given time. (e) The Board of Directors may adopt by resolution a procedure by which a stockholder may certify in writing to the corporation that any shares registered in the name of the stockholder are held for the account of a specified person other than the stockholder. The resolution shall set forth: the class of stockholders who may make the certification; the purpose for which the certification may be made; the form of certification; the information to be contained in it; if the certification is with respect to a record date or closing of the stock transfer books, the time after the record date or closing of the stock transfer books within which the certification must be received by the corporation; and any other provisions with respect to the procedure which the Board of Directors considers necessary or desirable. On receipt of such certification, the person specified in the certification shall be regarded as, for the purposes set forth in the certification, the stockholder of record of the specified shares in place of the stockholder who makes the certification. SECTION 2.9 INSPECTORS. At any meeting of stockholders, the chairman of the meeting may appoint one or more persons as inspectors for such meeting. Such inspectors shall ascertain and report the number of shares represented at the meeting based on their determination of the validity and effect of proxies, count all votes, report the results and perform such other acts as are proper to conduct the election and voting with impartiality and fairness to all the stockholders. Each report of an inspector or inspectors shall be in writing and signed by him or by a majority of them if there is more than one inspector; the report of a majority shall be the report of the inspectors. The report of the inspector or inspectors on the number of shares represented at the meeting and the results of the voting shall be prima facie evidence thereof. SECTION 2.10 ACTION WITHOUT MEETINGS. Except as provided in the next sentence, any action required or permitted to be taken at a meeting of stockholders may be taken without a meeting if there is filed with the records of stockholders' meetings a unanimous written consent which sets forth the action and is signed by each stockholder entitled to vote on the matter. Unless the Articles of Incorporation require otherwise, the holders of any class of stock other than common stock, entitled to vote generally in the election of directors, may take action or consent to any action by the written consent of stockholders entitled to cast not less than the minimum number of votes that would be necessary to authorize or take the action at a stockholders meeting if the corporation gives notice of the action to each stockholder not later than ten (10) days after the effective time of the action. SECTION 2.11 VOTING BY BALLOT. If ordered by the presiding officer of any stockholder meeting, the vote upon any election or question shall be by ballot. 6 ARTICLE III DIRECTORS SECTION 3.1 NUMBER AND TERM OF OFFICE. The number of directors of the corporation shall not be less than one (1) nor more than twelve (12) until changed by a Bylaw amending this Section 3.1 duly adopted by the Board of Directors. The exact number of directors shall be fixed from time to time, within the limits specified in this Section 3.1, by the Board of Directors. Subject to the foregoing provisions for changing the number of directors, the number of directors of the corporation has been fixed at ten (10). With the exception of the first Board of Directors, which shall be elected by the incorporators, and except as provided in Section 3.3, the directors shall be elected by a plurality vote of the shares represented in person or by proxy, at the stockholders annual meeting in each year and entitled to vote on the election of directors. Elected directors shall hold office until the next annual meeting and until their successors are duly elected and qualified. Directors need not be stockholders. A director may not stand for re-election if he or she has attained age seventy (70) on or before the date of the annual meeting at which directors are elected. SECTION 3.2 POWERS. The powers of the corporation shall be exercised, its business conducted and its property controlled by or under the direction of the Board of Directors. SECTION 3.3 VACANCIES. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled only by a majority of the directors then in office, although less than a quorum, or by a sole remaining director, and each director so elected shall hold office for the unexpired portion of the term of the director whose place is vacant and until his or her successor is duly elected and qualified. A vacancy in the Board of Directors shall be deemed to exist under this Section 3.3 in the case of the death, removal or resignation of any director, or if the stockholders fail at any meeting of stockholders at which directors are to be elected (including any meeting referred to in Section 3.4 below) to elect the number of directors then constituting the whole Board of Directors. SECTION 3.4 RESIGNATIONS AND REMOVALS. (a) Any director may resign at any time by delivering his or her resignation to the Secretary in writing or by electronic transmission, such resignation to specify whether it will be effective at a particular time, upon receipt by the Secretary or at the pleasure of the Board of Directors. If no such specification is made it shall be deemed effective at the pleasure of the Board of Directors. When one or more directors resigns from the Board of Directors effective at a future date, only a majority of the remaining directors then in office, even if such remaining directors do not constitute a quorum, shall have the power to fill such vacancy or vacancies, the vote thereon to take effect when such resignation or resignations become effective, and each 7 director so chosen shall hold office for the unexpired portion of the term of the director whose place is vacated and until his or her successor is duly elected and qualified. (b) At a special meeting of stockholders called for the purpose in the manner provided above, the Board of Directors or any individual director may be removed from office with cause, by the affirmative vote of at least two-thirds of all the votes entitled to be cast by the stockholders generally in the election of directors. SECTION 3.5 MEETINGS. (a) The annual meeting of the Board of Directors shall be held immediately after the annual stockholders' meeting and at the place where such meeting is held or at the place announced by the Chairman at such meeting. No notice of an annual meeting of the Board of Directors shall be necessary, and such meeting shall be held for the purpose of electing officers and transacting such other business as may lawfully come before it. The Board of Directors may provide, by resolution, the time and place, either within or outside the State of Maryland, for the holding of regular meetings of the Board of Directors without notice other than such resolution. (b) Special meetings of the Board of Directors may be called by or at the request of the Chairman of the Board of Directors, the Chief Executive Officer or by a majority of the members of the Board of Directors. The person or persons authorized to call special meetings of the Board of Directors may fix any place, either within or outside the State of Maryland, as the place for holding any special meeting of the Board of Directors called by them. (c) Written notice of the time and place of all special meetings of the Board of Directors shall be delivered personally to each director or sent by telegram or facsimile transmission or other form of electronic transmission at least twenty-four (24) hours before the start of the meeting, or sent by first class mail at least five (5) days before the date of the meeting. Notice of any meeting may be waived in writing, which shall be filed with the records of the meeting, at any time before or after the meeting and will be waived by any director by attendance thereat. SECTION 3.6 QUORUM AND VOTING. (a) A quorum of the Board of Directors shall consist of a majority of the exact number of directors fixed from time to time in accordance with Section 3.1; provided, however, at any meeting whether a quorum is present or otherwise, a majority of the directors present may adjourn from time to time until the time fixed for the next regular meeting of the Board of Directors, without notice other than by announcement at the meeting. (b) At each meeting of the Board of Directors at which a quorum is present, all questions and business shall be determined by a vote of a majority of the directors present, unless a different vote is required by law, the Articles of Incorporation or these Bylaws. (c) Any member of the Board of Directors, or of any committee thereof, may participate in a meeting by means of conference telephone or other communication equipment by means of which all persons participating in the meeting can hear each other at the same time, and participation in a meeting by such means shall constitute presence in person at such meeting. 8 (d) The transactions of any meeting of the Board of Directors, or any committee thereof, however called or noticed, or wherever held, shall be as valid as though had at a meeting duly held after regular call and notice if a quorum is present and if, either before or after the meeting, each of the directors not present signs a written waiver of notice, or a consent to holding such meeting, or an approval of the minutes thereof. All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting. SECTION 3.7 ACTION WITHOUT MEETING. Unless otherwise restricted by the Articles of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if a unanimous written consent which sets forth the action is signed by each member of the Board of Directors or of such committee, as the case may be, filed with the minutes of proceedings of the Board of Directors or committee. SECTION 3.8 FEES AND COMPENSATION. Directors and members of committees may receive such compensation, if any, for their services, and such reimbursement for expenses, as may be fixed or determined by resolution of the Board of Directors. SECTION 3.9 PRESUMPTION OF ASSENT. A director of the corporation who is present at a meeting of the Board of Directors at which action on any corporate matter is taken shall be presumed to have assented to the action taken unless (a) such director announces his or her dissent at the meeting and (b)(i) his or her dissent is entered in the minutes of the meeting, (ii) he or she files his or her written dissent to such action with the person acting as the secretary of the meeting before the adjournment thereof or (iii) he or she forwards such dissent within twenty-four (24) hours after the meeting is adjourned, by certified mail, return receipt requested, bearing a postmark from the United States Postal Service to the secretary of the meeting or the Secretary of the corporation. Such right to dissent shall not apply to a director who voted in favor of such action or failed to make his or her dissent known at the meeting. SECTION 3.10 COMMITTEES. (a) The Board of Directors may, by resolution passed by a majority of the whole Board of Directors, appoint an Executive Committee of one or more directors. The Executive Committee to the extent permitted by law shall have and may exercise all powers of the Board of Directors in the management of the business and affairs of the corporation, except as prohibited by law. If the Board of Directors has given general authorization for the issuance of stock providing for or establishing a method or procedure for determining the maximum number of shares to be issued, a committee of the Board of Directors, in accordance with that general authorization or any stock option or other plan or program adopted by the Board of Directors, may authorize or fix the terms of stock subject to classification or reclassification and the terms on which any stock may be issued, including all terms and conditions required or permitted to be established or authorized by the Board of Directors under Sections 2-203 and 2-208 of the Maryland General Corporation Law. 9 (b) The Board of Directors may, by resolution passed by a majority of the whole Board of Directors, from time to time appoint such other committees as may be permitted or required by law. Such other committees appointed by the Board of Directors shall have such powers and perform such duties as may be prescribed by the resolution or resolutions creating such committee, but in no event shall any such committee have the powers denied to the Executive Committee in these Bylaws. (c) The members of all committees of the Board of Directors shall serve a term coexistent with that of the Board of Directors which appointed such committee. The Board of Directors, subject to the provisions of subsections (a) or (b) of this Section 3.10, may at any time increase or decrease the number of members of a committee or terminate the existence of a committee; provided that no committee shall consist of less than one member. The membership of a committee member shall terminate on the date of his or her death or voluntary resignation, but the Board of Directors may at any time for any reason remove any individual committee member and the Board of Directors may fill any committee vacancy created by death, resignation, removal or increase in the number of members of the committee. The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee, and, in addition, in the absence or disqualification of any member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not he, she or they constitute a quorum, may unanimously appoint another member of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. (d) Unless the Board of Directors otherwise provides, regular meetings of the Executive Committee or any other committee appointed pursuant to this Section 3.10 shall be held at such times and places as are determined by the Board of Directors, or by any such committee, and when notice thereof has been given to each member of such committee, no further notice of such regular meetings need be given thereafter. Special meetings of any such committee may be held at the principal office of the corporation or at any place which has been designated from time to time by resolution of such committee or by written consent of all members thereof, and may be called by any director who is a member of such committee upon written notice to the members of such committee of the time and place of such special meeting given in the manner provided for the giving of written notice to members of the Board of Directors of the time and place of special meetings of the Board of Directors. Notice of any special meeting of any committee may be waived in writing at any time before or after the meeting and will be waived by any director by attendance thereat. A majority of the authorized number of members of any such committee shall constitute a quorum for the transaction of business, and the act of a majority of those present at any meeting at which a quorum is present shall be the act of such committee. ARTICLE IV OFFICERS SECTION 4.1 OFFICERS DESIGNATED. 10 The Board of Directors, promptly after its election in each year, shall appoint a Chairman of the Board of Directors, a Vice Chairman of the Board of Directors and a President (all of whom shall be directors) and a Treasurer and Secretary and may appoint one or more Vice Presidents and such other officers or assistant officers as it may deem proper. Any officer may hold more than one office, except for the offices of President and Vice President. A person who holds more than one office in the corporation may not act in more than one capacity to execute, acknowledge or verify an instrument required by law to be executed, acknowledged or verified by more than one officer. Vacancies among the officers and assistant officers shall be filled by the Board of Directors. SECTION 4.2 TENURE AND DUTIES OF OFFICERS. (a) All officers shall hold office at the pleasure of the Board of Directors and until their successors are duly elected and qualified, unless sooner removed. Any officer elected or appointed by the Board of Directors may be removed at any time by the Board of Directors if the Board of Directors in its judgment finds that the best interests of the corporation will be served. If the office of any officer becomes vacant for any reason, the vacancy may be filled by the Board of Directors. Nothing in these Bylaws shall be construed as creating any kind of contractual right to employment with the corporation. (b) The Chairman of the Board of Directors when present shall preside at all meetings of the stockholders and the Board of Directors. The Chairman of the Board of Directors shall perform such other duties and have such other powers as the Board of Directors may designate from time to time. (c) The Vice Chairman in the absence of the Chairman of the Board of Directors shall preside at all meetings of the stockholders and at all meetings of the Board of Directors. The Vice Chairman of the Board of Directors shall perform such other duties and have such other powers as the Board of Directors may designate from time to time. (d) The President shall be the chief executive officer of the corporation and in the absence of the Chairman and Vice Chairman of the Board of Directors, shall preside at all meetings of the stockholders and at all meetings of the Board of Directors. The President shall perform such other duties and have such other powers as the Board of Directors may designate from time to time. (e) The Vice Presidents, in the order of their seniority, may assume and perform the duties of the President in the absence or disability of the President or whenever the office of the President is vacant. The Vice Presidents shall perform such other duties and have such other powers as the Board of Directors or the President may designate from time to time. (f) The Secretary shall attend all meetings of the stockholders and of the Board of Directors and any committee thereof, and shall record all acts and proceedings thereof in the minute book of the corporation. The Secretary shall give notice, in conformity with these Bylaws, of all meetings of the stockholders and of all meetings of the Board of Directors and any committee thereof requiring notice. The Secretary shall perform such other duties and have such other powers as the Board of Directors may designate from time to time. The President may 11 direct any assistant secretary to assume and perform the duties of the Secretary in the absence or disability of the Secretary, and each assistant secretary shall perform such other duties and have such other powers as the Board of Directors or the President may designate from time to time. (g) The Treasurer shall keep or cause to be kept the books of account of the corporation in a thorough and proper manner, and shall render statements of the financial affairs of the corporation in such form and as often as required by the Board of Directors or the President. The Treasurer, subject to the order of the Board of Directors, shall have the custody of all funds and securities of the corporation. The Treasurer shall perform all other duties commonly incident to his or her office and shall perform such other duties and have such other powers as the Board of Directors or the President may designate from time to time. The President may direct any assistant treasurer to assume and perform the duties of the Treasurer in the absence or disability of the Treasurer, and each assistant treasurer shall perform such other duties and have such other powers as the Board of Directors or the President may designate from time to time. ARTICLE V EXECUTION OF CORPORATE INSTRUMENTS AND VOTING OF SECURITIES OWNED BY THE CORPORATION SECTION 5.1 EXECUTION OF CORPORATE INSTRUMENTS. (a) The Board of Directors may in its discretion determine the method and designate the signatory officer or officers, or other person or persons, to execute any corporate instrument or document, or to sign the corporate name without limitation, except where otherwise provided by law, and such execution or signature shall be binding upon the corporation. (b) All checks and drafts drawn on banks or other depositaries on funds to the credit of the corporation or in special accounts of the corporation shall be signed by such person or persons as the Board of Directors may authorize. (c) Execution of any corporate instrument may be effected in such form, either manual, facsimile or electronic signature, as may be authorized by the Board of Directors. SECTION 5.2 VOTING OF SECURITIES OWNED BY CORPORATION. All stock and other securities of other corporations owned or held by the corporation for itself or for other parties in any capacity shall be voted, and all proxies with respect thereto shall be executed, by the person authorized so to do by resolution of the Board of Directors or, in the absence of such authorization, by the Chairman of the Board of Directors, the President or any Vice President. ARTICLE VI SHARES OF STOCK SECTION 6.1 CERTIFICATES. 12 Each stockholder shall be entitled to a certificate or certificates which represent and certify the number of shares of each class held by him or her in the corporation; provided, however, that the Board of Directors may provide by resolution or resolutions that some or all of any class or series of shares may be uncertificated. Each certificate shall include on its face the name of the corporation, the name of the stockholder or other person to whom it is issued and the class of stock and number of shares it represents. Each certificate shall be signed by the Chairman of the Board of Directors, the President or any Vice President and countersigned by the Secretary or an assistant secretary or the Treasurer or an assistant treasurer and may be sealed with the seal, if any, of the corporation. The signatures may be either manual or facsimile. Certificates shall be consecutively numbered; and if the corporation issues several classes of shares, each class may have its own numbered series. A certificate is valid and may be issued whether or not an officer who signed it is still an officer when it is issued. A stock certificate may not be issued until the stock represented by it is fully paid. Each certificate representing shares which are restricted as to their transferability shall contain a full statement of such restriction or state that the corporation will furnish information about the restriction to the stockholder on request and without charge. Except as otherwise provided by law, the fact that a stock certificate does not contain or refer to a restriction on transferability that is adopted after the date of issuance of the stock certificate does not mean that the restriction is invalid or unenforceable. If the corporation has authority to issue shares of more than one class, the certificate shall contain on the face or back a full statement or summary of the designations and any preferences, conversion and other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of each class of shares which the corporation is authorized to issue and, if the corporation is authorized to issue any preferred or special class in series, the differences in the relative rights and preferences between the shares of each series to the extent they have been set and the authority of the Board of Directors to set the relative rights and preferences of subsequent series. In lieu of such statement or summary, the certificate may state that the corporation will furnish a full statement of such information to any stockholder upon request and without charge. SECTION 6.2 TRANSFERS. Upon surrender to the corporation or the transfer agent of the corporation of a stock certificate duly endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, the corporation shall issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction on its books. Notwithstanding the foregoing, transfers of shares of any class will be subject in all respects to the Articles of Incorporation and all of the terms and conditions contained therein. SECTION 6.3 REPLACEMENT CERTIFICATE. The Secretary and any other officer designated by the Board of Directors may direct a new certificate to be issued in place of any certificate previously issued by the corporation alleged to have been lost, stolen or destroyed upon the making of an affidavit of that fact by the person claiming the certificate to be lost, stolen or destroyed. When authorizing the issuance of a new certificate, the Secretary or other officer designated by the Board of Directors may, in his or her discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate or the owner's legal representative to give bond, with sufficient 13 surety, to the corporation to indemnify it against any loss or claim which may arise as a result of the issuance of a new certificate. SECTION 6.4 STOCK LEDGER. The corporation shall maintain at its principal office or at the office of its counsel, accountants or transfer agent, an original or duplicate stock ledger containing the name and address of each stockholder and the number of shares of each class held by such stockholder. The stock ledger may be in written form or in any other form which can be converted within a reasonable time into written form for visual inspection. The corporation shall be entitled to treat the holder of record of any share as the holder in fact thereof and, accordingly, shall not be bound to recognize any equitable or other claim to or interest in such Share or on the part of any other person, whether or not it has express or other notice thereof, except as otherwise provided by the laws of the State of Maryland. SECTION 6.5 ISSUANCE OF UNITS. Notwithstanding any other provision of these Bylaws to the contrary, the Board of Directors may issue units consisting of different securities of the corporation. Any security issued in a unit shall have the same characteristics as any identical securities issued by the corporation, except that the Board of Directors may provide that, for a specified period, securities of the corporation issued in such unit may be transferred on the books of the corporation only in such unit. SECTION 6.6 FRACTIONAL SHARE INTERESTS OR SCRIP. The corporation may, but is not obliged to, issue fractional shares of stock, eliminate a fractional interest by rounding off to a full share of stock, arrange for the disposition of a fractional interest by the person entitled to it, pay cash for the fair value of a fractional share of stock determined as of the time when the person entitled to receive it is determined, or issue scrip, or other evidence of ownership aggregating a full share for a certificate which represents the share and, unless otherwise provided, does not entitle the holder to exercise any voting rights, to receive dividends thereon or to participate in any of the assets of the corporation in the event of liquidation. The Board of Directors may impose any reasonable condition on the issuance of scrip or other evidence of ownership, and may cause such scrip or other evidence of ownership to be issued subject to the condition that it will become void if not exchanged for a certificate representing a full share of stock before a specified date or subject to the condition that the shares for which such scrip or other evidence of indebtedness are exchangeable may be sold by the corporation and the proceeds thereof distributed to the holders of such scrip or other evidence of indebtedness, or subject to a provision of forfeiture of such proceeds to the corporation if not claimed within a period of not less than three years from the date the scrip or other evidence of ownership was originally issued. SECTION 6.7 DIVIDENDS. If declared by the Board of Directors at any meeting thereof, the corporation may pay dividends on its shares in cash, property, or in shares of the capital stock of the corporation, 14 unless such dividend is contrary to law or to a restriction contained in the Articles of Incorporation. ARTICLE VII EXEMPTION FROM CONTROL SHARE ACQUISITION ACT The provisions of Title 3, Subtitle 7 of the Maryland General Corporation Law (the Maryland Control Share Acquisition Act), or any successor statute, shall not apply to any acquisition by any person of shares of the corporation. This Article VII may be repealed, in whole or in part, at any time, whether before or after an acquisition of control shares and, upon such repeal, may, to the extent provided by any successor bylaw and consistent with applicable law, apply to any prior or subsequent control share acquisition. ARTICLE VIII OTHER SECURITIES OF THE CORPORATION Each certificate which represents any bond, note, guaranty, obligation or other corporate security (other than stock) shall be signed by the Chairman of the Board of Directors, the President or any Vice President and countersigned by the Secretary, an assistant secretary, the Treasurer or the assistant treasurer. Such certificate may be sealed with the actual corporate seal or a facsimile of it or in any other form. The signatures on the certificate may be either manual or facsimile signatures. A certificate is valid and may be issued whether or not an officer who signed it is still an officer at the time it is issued. ARTICLE IX CORPORATE SEAL The corporate seal shall be a flat-faced circular die, of which there may be any number of counterparts, with the word "SEAL" and the name of the corporation engraved thereon. Said seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise. If the corporation is required to place its corporate seal to a document, it is sufficient to meet the requirements of any law, rule or regulation relating to a corporate seal to place the word "(seal)" adjacent to the signature of the person authorized to sign the document on behalf of the corporation. ARTICLE X FISCAL YEAR The fiscal year of the corporation shall be the twelve (12) calendar months ending December 31 in each year, unless otherwise provided by the Board of Directors. 15 ARTICLE XI INDEMNIFICATION SECTION 11.1 RIGHT TO INDEMNIFICATION. The corporation shall indemnify its directors and officers, whether serving the corporation or, at its request, any other entity, to the full extent required or permitted by the general laws of the State of Maryland now or hereafter in force, including the advancement of expenses under the procedures and to the full extent permitted by law. The corporation may indemnify other employees and agents, whether serving the corporation or, at its request, any other entity, to such extent as may be authorized by the Board of Directors and as permitted by law. The foregoing rights of indemnification shall not be exclusive of any other rights to which those seeking indemnification may be entitled. The Board of Directors may take such action as is necessary to carry out these indemnification provisions and is expressly empowered to adopt, approve and amend from time to time resolutions or contracts implementing such provisions or such further indemnification arrangements as may be permitted by law. No amendment of these Bylaws or repeal of any of its provisions shall limit or eliminate the foregoing right to indemnification provided hereunder with respect to acts or omissions occurring prior to such amendment or repeal. SECTION 11.2 PROVISIONS NONEXCLUSIVE. The rights conferred on any person by this Article XI shall not be exclusive of any other rights that such person may have or hereafter acquire under any statute, provision of the Articles of Incorporation, agreement, vote of stockholders or disinterested directors, or otherwise, both as to action in an official capacity and as to action in another capacity while holding such office. To the extent that any provision of the Articles of Incorporation, agreement or vote of the stockholders or disinterested directors is inconsistent with these Bylaws, the provision, agreement or vote shall take precedence. SECTION 11.3 AUTHORITY TO INSURE. The corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation or who, while a director, officer, employee or agent of the corporation, is or was serving at the request of the corporation as a director, officer, partner, trustee, employee or agent of another corporation, partnership, joint venture, trust, other enterprise or employee benefit plan against any liability asserted against and incurred by such person in any such capacity or arising out of such person's position, whether or not the corporation would have the power to indemnify against liability under the general laws of the State of Maryland. SECTION 11.4 SURVIVAL OF RIGHTS. The rights provided by this Article shall continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person. 16 SECTION 11.5 SUBROGATION. In the event of payment under this Article, the corporation shall be subrogated to the extent of such payment to all of the rights of recovery of the director or officer, who shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such documents necessary to enable the corporation effectively to bring suit to enforce such rights. SECTION 11.6 NO DUPLICATION OF PAYMENTS. The corporation shall not be liable under this Article to make any payment in connection with any claim made against a director or officer to the extent the director or officer has otherwise actually received payment (under any insurance policy, agreement, vote or otherwise) of the amounts otherwise indemnifiable hereunder. 17 -----END PRIVACY-ENHANCED MESSAGE-----

EX-2.01

                                                                    Exhibit 2.01

                               ARTICLES OF MERGER

                                       OF

                       United Dominion Realty Trust, Inc.

                                       AND

                               UDRT Maryland, Inc.

         FIRST: United Dominion Realty Trust, Inc. ("Parent") and UDRT Maryland,
Inc. ("Subsidiary"), being the corporations which are the parties to these
Articles of Merger, do hereby agree to effect a merger of said corporations upon
the terms and conditions herein set forth.

         SECOND: The Subsidiary is the corporation to survive the merger.
Subsidiary is a corporation incorporated in the State of Maryland under the
provisions of the State of Maryland General Corporation Law with its principal
office in the State of Maryland located at 300 E. Lombard St., Baltimore, MD
21202, and which will continue its corporate existence pursuant to the
provisions of the Maryland General Corporation Law.

         THIRD: The Parent is the corporation to be merged into the Subsidiary.
Parent is a corporation incorporated in the Commonwealth of Virginia, which was
incorporated under general law in said state on March 11, 1970 and the corporate
existence of which will cease upon the effective date of the merger in
accordance with the provisions of the general laws of the Commonwealth of
Virginia. The Parent has no principal office in the State of Maryland.

         Parent owns interests in land in the following counties in the State of
Maryland:

                  Wicomico County
                  Hartford County
                  Howard County
                  Anne Arundel County
                  Talbot County
                  Saint Mary's County

         Parent was qualified to conduct interstate and foreign business in the
State of Maryland as a foreign corporation on December 9, 1992.

         FOURTH: In connection with the merger, the charter of the Subsidiary
(the "Charter") is amended and restated as set forth on EXHIBIT A, attached
hereto and incorporated herein, and the Charter, as amended, shall continue in
full force and effect until duly amended in accordance with its terms and
applicable law.



         FIFTH: In connection with the merger, the subsidiary hereby changes its
name from UDRT Maryland, Inc. to United Dominion Realty Trust, Inc.

         SIXTH: Immediately prior to the merger, the total number of shares of
stock of all classes which Parent has the authority to issue is 175,000,000
shares of stock, consisting of 150,000,000 shares of common stock, $1.00 par
value per share, and 25,000,000 shares of preferred stock without par value. The
aggregate par value of all authorized shares of stock of Parent having par value
is currently $150,000,000.

         SEVENTH: Immediately prior to the merger, the total number of shares of
stock of all classes which Subsidiary has authority to issue is 1,000 shares,
par value $1.00 per share, all of one class. The aggregate par value of all
classes of stock of Subsidiary having par value is $1,000.

         EIGHTH: The total number of shares of stock of all classes which
Subsidiary has authority to issue immediately after the merger is 275,000,000
shares of stock, consisting of 250,000,000 shares of common stock, $1.00 par
value per share, and 25,000,000 shares of preferred stock, without par value.
The aggregate par value of all authorized shares of stock of Subsidiary having
par value immediately after the merger is $250,000,000.

         NINTH: Upon the Effective Time (defined below), Parent shall be merged
into Subsidiary. Thereupon, Subsidiary shall possess any and all purposes and
powers of Parent; and all leases, licenses, property, rights, privileges, and
powers of whatever nature and description of Parent shall be transferred to,
vested in, and devolved upon Subsidiary, without further act or deed, subject to
all of the debts and obligations of Parent. At the Effective Time, each share of
stock of Subsidiary issued and outstanding immediately prior to the Effective
Time shall be canceled and cease to exist and each share of stock of Parent
issued and outstanding immediately prior to the Effective Time shall be
converted into one share of stock of Subsidiary.

         TENTH: The terms and conditions of the merger herein set forth were
advised, authorized, and approved by Subsidiary in the manner and by the vote
required by its charter and the provisions of the Maryland General Corporation
Law, and the said merger was approved in the manner hereinafter set forth.

         ELEVENTH: The merger was duly advised by the Board of Directors of
Subsidiary in the following manner. Said Board of Directors of Subsidiary
adopted a resolution declaring that the merger of Parent into Subsidiary is
advisable substantially upon the terms and conditions set forth or referred to
in said resolution and directed that the merger be submitted for consideration
by the sole stockholder of Subsidiary. Said resolution of the Board of Directors
of Subsidiary was adopted by a written consent signed on June 11, 2003 by the
sole member of the Board of Directors of Subsidiary without a meeting.

         TWELFTH: The merger and the aforesaid terms and conditions were duly
approved by the stockholders of Subsidiary in the following manner. Parent, the
sole

                                       2



stockholder of Subsidiary, by written consent, approved the merger described in
these Articles of Merger on substantially the terms and conditions set forth
herein.

         THIRTEENTH: The terms and conditions of the merger herein set forth
were duly advised, authorized, and approved, with respect to Parent, in the
manner and by the vote required by the charter of said corporation and by the
laws of the Commonwealth of Virginia, which is the state of incorporation of
said corporation, as follows:

         The Board of Directors of Parent, by resolution filed with the minutes
of the proceedings of such Board of Directors, approved the merger described in
these Articles of Merger on substantially the terms and conditions set forth
herein. The holders of more than two-thirds of the outstanding stock of Parent
entitled to vote on the merger approved the merger at a meeting duly called and
held after at least 20 days' notice of the purpose of the meeting was mailed to
each such shareholder at the shareholders address as it appears on the records
of Parent.

         FOURTEENTH: These Articles of Merger shall become effective upon the
date of filing with the State Department of Assessments and Taxation of the
State of Maryland (the "Effective Time").

                              [Intentionally Blank]

                                       3




         IN WITNESS WHEREOF, these Articles of Merger are hereby signed for and
on behalf of Parent by its Vice President and Secretary, who does hereby
acknowledge that said Articles of Merger are the act of said corporation, and
who does hereby state under the penalties for perjury that the matters and facts
set forth therein with respect to authorization and approval of said merger are
true in all material respects to the best of her knowledge, information, and
belief; and these Articles of Merger are hereby signed for and on behalf of
Subsidiary by its President, who does hereby acknowledge that said Articles of
Merger are the act of said corporation, and who does hereby state under the
penalties for perjury that the matters and facts stated therein with respect to
authorization and approval of said merger are true in all material respects to
the best of his knowledge, information, and belief.

         Executed on this 11th day of June, 2003.

                                        United Dominion Realty Trust, Inc.

                                        By:/s/ Mary Ellen Norwood
                                           ------------------------------------
                                           Mary Ellen Norwood
                                           Vice President and Secretary

Attest:  June 11, 2003

/s/ Mary Ellen Norwood
- ---------------------------------
Mary Ellen Norwood
Vice President and Secretary

         Executed on this 11th, day of June, 2003.

                                        UDRT Maryland, Inc.

                                        By:/s/ Warren L. Troupe
                                           ------------------------------------
                                           Warren L. Troupe
                                           President

Attest:  June 11, 2003

/s/ Warren L. Troupe
- ---------------------------------
Warren L. Troupe
Secretary



                                    EXHIBIT A

                 AMENDED AND RESTATED ARTICLES OF INCORPORATION

                                    ARTICLE I
                                  INCORPORATOR

         The undersigned, Warren L. Troupe, whose address is c/o Morrison &
Foerster LLP, 5200 Republic Plaza, 370 17th Street, Denver, Colorado 80202,
being at least 18 years of age, does hereby form a Corporation under the general
laws of the State of Maryland.

                                   ARTICLE II
                                      NAME

         The name of the Corporation is United Dominion Realty Trust, Inc. (the
"Corporation").

                                   ARTICLE III
                                    PURPOSES

         The purposes for which the Corporation is formed are to engage in any
lawful act or activity (including, without limitation or obligation, engaging in
business as a real estate investment trust under the Internal Revenue Code of
1986, as amended, or any successor statute (the "Code")) for which Corporations
may be organized under the general laws of the State of Maryland as now or
hereafter in force. For purposes of these Articles of Incorporation (this
"Charter"), "REIT" means a real estate investment trust under Section 856 of the
Code.

                                   ARTICLE IV
                  PRINCIPAL OFFICE IN STATE AND RESIDENT AGENT

         The address of the principal office of the Corporation in the State of
Maryland is 300 E. Lombard Street, Baltimore, Maryland 21202. The name and
address of the resident agent of the Corporation in the State of Maryland is The
Corporation Trust Incorporated, a Maryland Corporation, 300 E. Lombard Street,
Baltimore, Maryland 21202. The Corporation may have such other offices and
places of business within or outside the State of Maryland as the Corporation
may from time to time determine.

                                    ARTICLE V
                                      STOCK

         Section 5.1 Authorized Shares. The Corporation shall have authority to
issue 250,000,000 shares of Common Stock having a par value of $1.00 per share
("Common Stock") and 25,000,000 shares of preferred stock without par value
("Preferred Stock"). The aggregate par value of all authorized shares of stock
having par value is $250,000,000. If shares of one class of stock are classified
or reclassified into shares of another class of stock pursuant to Section 5.2(b)
or Section 5.3, the number of authorized shares of the former class shall be
automatically decreased and the number of shares of the latter class shall be
automatically increased, in each case by the number of shares so classified or
reclassified, as the case may be, so that the aggregate number of shares of all
classes that the Corporation has authority to issue shall not be more than the
total number of shares set forth in the first sentence of this Article V. To the
extent permitted by Maryland law, the Board of Directors ("Board"), with the
approval of a majority of the entire Board and without any action by the
stockholders, may amend this Charter from time to time to (a) increase or
decrease the aggregate number of shares of stock of the Corporation, (b)
increase or

                                       1



decrease the number of shares of any class or series that the Corporation has
authority to issue, or (c) classify or reclassify any unissued shares by setting
or changing the preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications or terms and
conditions of redemption of such shares.

         Section 5.2 Common Stock.

                  (a) Common Stock Subject to Terms of Preferred Stock. The
Common Stock shall be subject to the express terms of any series of Preferred
Stock.

                  (b) Description. Each share of Common Stock shall entitle the
holder thereof to one (1) vote per share on all matters upon which stockholders
are entitled to vote. Shares of a particular class of Common Stock shall have
equal dividend, distribution, liquidation and other rights, and shall have no
preference, cumulative, preemptive, conversion or exchange rights except as
otherwise set forth herein. The Board may classify or reclassify any unissued
Common Stock from time to time in one or more classes or series of stock.

                  (c) Dividend or Distribution Rights. The Board from time to
time may authorize and the Corporation may pay to stockholders such dividends or
other distributions in cash or other property as the Board in its discretion may
determine. The Board shall endeavor to authorize, and the Corporation may pay,
such dividends and distributions as are necessary for the Corporation to qualify
as a REIT under the Code; provided, however, stockholders shall have no right to
any dividend or distribution unless and until authorized by the Board and
declared by the Corporation. The exercise of the powers and rights of the Board
pursuant to this Section 5.2 is subject to the provisions of any class or series
of shares at the time outstanding. The receipt by any person in whose name any
shares are registered on the records of the Corporation or by his or her duly
authorized agent shall be a sufficient discharge for all dividends or
distributions payable or deliverable in respect of such shares and from all
liability to see to the application thereof.

                  (d) Rights Upon Liquidation. In the event of any voluntary or
involuntary liquidation, dissolution or winding up, or any distribution of the
assets of the Corporation, the aggregate assets available for distribution to
holders of the Common Stock shall be determined in accordance with applicable
law and the terms of this Charter. Each holder of Common Stock shall be entitled
to receive, ratably with each other holder of Common Stock, that portion of such
aggregate assets available for distribution as the number of outstanding shares
of Common Stock held by such holder bears to the total number of shares of
Common Stock then outstanding.

                  (e) Voting Rights. Except as may be provided otherwise in this
Charter, and subject to the express terms of any series of Preferred Stock, the
holders of the Common Stock shall have the exclusive right to vote on all
matters (as to which a holder of Common Stock is entitled to vote pursuant to
applicable law) at all meetings of the stockholders of the Corporation.

         Section 5.3 Preferred Stock. The Board is hereby expressly granted the
authority to authorize from time to time the issuance of one or more series of
Preferred Stock. Prior to the issuance of each such class or series, the Board,
by resolution, shall fix the number of shares to be included in each series, and
the designation, preferences, terms, rights, restrictions, limitations,
qualifications and terms and conditions of redemption of the shares of each
class or series, if any. The authority of the Board with respect to each series
shall include, but not be limited to, determination of the following:

                  (a) The designation of the series, which may be by
distinguishing number, letter or title.

                                       2



                  (b) The dividend rate on the shares of the series, if any,
whether any dividends shall be cumulative and, if so, from which date or dates,
and the relative rights of priority, if any, of payment of dividends on shares
of the series.

                  (c) The redemption rights, including conditions and the price
or prices, if any, for shares of the series.

                  (d) The terms and amounts of any sinking fund for the purchase
or redemption of shares of the series.

                  (e) The rights of the shares of the series in the event of any
voluntary or involuntary liquidation, dissolution or winding up of the affairs
of the Corporation, and the relative rights of priority, if any, of payment of
shares of the series.

                  (f) Whether the shares of the series are convertible into
shares of any other class or series or any other security of the Corporation or
any other corporation or other entity, and, if so, the specification of such
other class or series of such other security, the conversion price or prices or
rate or rates, any adjustments thereof, the date or dates on which such shares
will be convertible and all other terms and conditions upon which such
conversion may be made.

                  (g) Restrictions on the issuance of shares of the same series
or of any other class or series.

                  (h) The voting rights of the holders of shares of the series
subject to the limitations contained in this Section 5.3.

                  (i) Any other relative rights, preferences and limitations on
that series, subject to the express provisions of any other series of Preferred
Stock then outstanding.

Notwithstanding any other provision of this Charter, the Board may increase or
decrease (but not below the number of shares of such series then outstanding)
the number of shares, or alter the designation or classify or reclassify any
unissued shares of a particular series of Preferred Stock, by fixing or
altering, in one or more respects, from time to time before issuing the shares,
the terms, rights, restrictions and qualifications of the shares of any such
series of Preferred Stock.

         Section 5.4 Series of Preferred Stock Authorized.

                  (a) 8.60% Series B Cumulative Redeemable Preferred Stock.

                      (i) Designation and Number. A series of the preferred
stock, designated the "8.60% Series B Cumulative Redeemable Preferred Stock"
(the "Series B Preferred"), is hereby established. The number of shares of the
Series B Preferred shall be 6,000,000.

                      (ii) Relative Seniority. In respect of rights to receive
dividends and to participate in distributions or payments in the event of any
liquidation, dissolution or winding up of the Corporation, the Series B
Preferred shall rank senior to the Common Stock and any other capital stock of
the Corporation ranking, as to dividends and upon liquidation, junior to the
Series B Preferred (collectively, for purposes of this Section 5.4(a), "Junior
Stock").

                      (iii) Dividends. The holders of the then outstanding
Series B Preferred shall be entitled to receive, when and as declared by the
Board out of any funds legally available therefor,

                                       3



cumulative preferential cash dividends at the rate of 8.60% of the liquidation
preference of the Series B Preferred (equivalent to $2.15 per share) per annum,
payable quarterly in arrears in cash on the last day, or the next succeeding
business day, of February, May, August and November in each year, beginning
August 31, 1997 (each such day being hereinafter called a "Dividend Payment
Date" and each period beginning on the day next following a Dividend Payment
Date and ending on the next following Dividend Payment Date being hereinafter
called a "Dividend Period"), to stockholders of record at the close of business
on the fifteenth day of the calendar month in which the applicable Dividend
Payment Date falls on or such date as shall be fixed by the Board at the time of
declaration of the dividend (the "Dividend Record Date"), which shall be not
less than 10 nor more than 30 days preceding the Dividend Payment Date. The
amount of any dividend payable for the initial Dividend Period and for any
partial Dividend Period shall be computed on the basis of a 360-day year
consisting of twelve 30-day months. Dividends on the shares of Series B
Preferred shall accrue and be cumulative from and including the date of original
issue thereof, whether or not (A) the Corporation has earnings, (B) dividends on
such shares are declared or (C) on any Dividend Payment Date there shall be
funds legally available for the payment of such dividends. When dividends are
not paid in full upon the shares of Series B Preferred and the shares of any
other series of preferred stock ranking on a parity as to dividends with the
Series B Preferred (or a sum sufficient for such full payment is not set apart
therefor), all dividends declared upon shares of Series B Preferred and any
other series of preferred stock ranking on a parity as to dividends with the
Series B Preferred shall be declared pro rata so that the amount of dividends
declared per share on the Series B Preferred and such other series of preferred
stock shall in all cases bear to each other the same ratio that accrued
dividends per share on the shares of Series B Preferred and such other series of
preferred stock bear to each other.

                           Except as provided in the immediately preceding
paragraph, unless full cumulative dividends on the Series B Preferred have been
or contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for payment on the Series B Preferred for all past
dividend periods and the then current dividend period, (i) no dividends shall be
declared or paid or set apart for payment on the preferred stock of the
Corporation ranking, as to dividends, on a parity with or junior to the Series B
Preferred for any period, and (ii) no dividends (other than in Junior Stock)
shall be declared or paid or set aside for payment or other distribution or
shall be declared or made upon the Junior Stock or any other capital stock of
the Corporation ranking on a parity with the Series B Preferred as to dividends
or upon liquidation (for purposes of this Section 5.4(a), "Parity Stock"), nor
shall any Junior Stock or any Parity Stock be redeemed, purchased or otherwise
acquired for any consideration (or any moneys be paid to or made available for a
sinking fund for the redemption of any shares of Junior Stock or Parity Stock)
by the Corporation (except by conversion into or exchange for Junior Stock).

                           Any dividend payment made on shares of the Series B
Preferred shall first be credited against the earliest accrued but unpaid
dividend due with respect to such shares which remains payable.

                           No dividends on shares of Series B Preferred shall be
declared by the Board or paid or set apart for payment by the Corporation at
such time as the terms and provisions of any agreement of the Corporation,
including any agreement relating to its indebtedness, prohibits such
declaration, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereunder, or if such declaration or payment shall be
restricted or prohibited by law.

                           The amount of any dividends accrued on any shares of
Series B Preferred at any Dividend Payment Date shall be the amount of any
unpaid dividends accumulated thereon, to and including such Dividend Payment
Date, whether or not earned or declared, and the amount of dividends accrued on
any shares of Series B Preferred at any date other than a Dividend Payment Date
shall be

                                       4



equal to the sum of the amount of any unpaid dividends accumulated thereon, to
and including the last preceding Dividend Payment Date, whether or not earned or
declared, plus an amount calculated on the basis of the annual dividend rate for
the period after such last preceding Dividend Payment Date to and including the
date as of which the calculation is made, based on a 360-day year of twelve
30-day months.

                           Accrued but unpaid dividends on the Series B
Preferred will not bear interest. Holders of the Series B Preferred will not be
entitled to any dividends in excess of full cumulative dividends as described
above.

                           Except as provided in this Charter, the Series B
Preferred shall not be entitled to participate in the earnings or assets of the
Corporation.

                           (iv) Liquidation Rights.

                                (A) Upon the voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the holders of shares
of the Series B Preferred then outstanding shall be entitled to receive and to
be paid out of the assets of the Corporation legally available for distribution
to its stockholders, before any distribution shall be made to the holders of
Common Stock or any other capital stock of the Corporation ranking junior to the
Series B Preferred upon liquidation, a liquidation preference of $25.00 per
share, plus accrued and unpaid dividends thereon to the date of payment.

                                (B) After the payment to the holders of the
shares of the Series B Preferred of the full liquidation preference provided for
in this paragraph (iv), the holders of the Series B Preferred as such shall have
no right or claim to any of the remaining assets of the Corporation.

                                (C) If, upon any voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the amounts payable
with respect to the liquidation preference of the shares of the Series B
Preferred and any other shares of stock of the Corporation ranking as to any
such distribution on a parity with the shares of the Series B Preferred are not
paid in full, the holders of the shares of the Series B Preferred and of such
other shares will share ratably in any such distribution of assets of the
Corporation in proportion to the full respective liquidation preferences to
which they are entitled.

                                (D) Neither the sale, lease, transfer or
conveyance of all or substantially all the property or business of the
Corporation, nor the merger or consolidation of the Corporation into or with any
other Corporation or the merger or consolidation of any other Corporation into
or with the Corporation, shall be deemed to be a dissolution, liquidation or
winding up, voluntary or involuntary, for the purposes of this paragraph (iv).

                           (v)  Redemption.

                                (A) Right of Optional Redemption. The Series B
Preferred is not redeemable prior to May 29, 2007. On and after May 29, 2007,
the Corporation may, at its option, redeem at any time all or, from time to
time, part of the Series B Preferred at a price per share (the "Series B
Redemption Price"), payable in cash, of $25.00, together with all accrued and
unpaid dividends to and including the date fixed for redemption (the "Series B
Redemption Date"), without interest. In case of redemption of less than all
shares of Series B Preferred at the time outstanding, the shares of Series B
Preferred to be redeemed shall be selected pro rata from the holders of record
of such shares in proportion to the number of shares of Series B Preferred held
by such holders (as nearly as may be

                                       5



practicable without creating fractional shares) or by any other equitable method
determined by the Corporation.

                                    (B) Procedures for Redemption.

                                             (1) Notice of any redemption will
be (a) given by publication in a newspaper of general circulation in the City of
New York, New York, such publication to be made once a week for two successive
weeks commencing not less than 30 nor more than 60 days prior to the Series B
Redemption Date, and (b) mailed by the Corporation, postage prepaid, not less
than 30 nor more than 60 days prior to the Series B Redemption Date, addressed
to the respective holders of record of the Series B Preferred to be redeemed at
their respective addresses as they appear on the stock transfer records of the
Corporation. No failure to give such notice or any defect therein or in the
mailing thereof shall affect the validity of the proceedings for the redemption
of any Series B Preferred except as to the holder to whom the Corporation has
failed to give notice or except as to the holder to whom notice was defective.
In addition to any information required by law or by the applicable rules of any
exchange upon which Series B Preferred may be listed or admitted to trading,
such notice shall state: (a) the Series B Redemption Date; (b) the Series B
Redemption Price; (c) the number of shares of Series B Preferred to be redeemed;
(d) the place or places where certificates for such shares are to be surrendered
for payment of the Series B Redemption Price; and (e) that dividends on the
shares to be redeemed will cease to accumulate on the Series B Redemption Date.
If less than all the shares of Series B Preferred held by any holder are to be
redeemed, the notice mailed to such holder shall also specify the number of
shares of Series B Preferred held by such holder to be redeemed.

                                             (2) If notice of redemption of any
shares of Series B Preferred has been published and mailed in accordance with
subparagraph (v)(B)(1) above and provided that on or before the Series B
Redemption Date specified in such notice all funds necessary for such redemption
shall have been irrevocably set aside by the Corporation, separate and apart
from its other funds in trust for the benefit of any holders of the shares of
Series B Preferred so called for redemption, so as to be, and to continue to be
available therefor, then, from and after the Series B Redemption Date, dividends
on such shares of Series B Preferred shall cease to accrue, and such shares
shall no longer be deemed to be outstanding and shall not have the status of
Series B Preferred and all rights of the holders thereof as stockholders of the
Corporation (except the right to receive the Series B Redemption Price) shall
terminate. Upon surrender, in accordance with said notice, of the certificates
for any shares of Series B Preferred so redeemed (properly endorsed or assigned
for transfer, if the Corporation shall so require and the notice shall so
state), such shares of Series B Preferred shall be redeemed by the Corporation
at the Series B Redemption Price. In case less than all the shares of Series B
Preferred represented by any such certificate are redeemed, a new certificate or
certificates shall be issued representing the unredeemed shares of Series B
Preferred without cost to the holder thereof.

                                             (3) The deposit of funds with a
bank or trust company for the purpose of redeeming Series B Preferred shall be
irrevocable except that:

                                                      (a) the Corporation shall
be entitled to receive from such bank or trust company the interest or other
earnings, if any, earned on any money so deposited in trust, and the holders of
any shares redeemed shall have no claim to such interest or other earnings; and

                                                      (b) any balance of moneys
so deposited by the Corporation and unclaimed by the holders of the Series B
Preferred entitled thereto at the expiration of two years from the applicable
Series B Redemption Date shall be repaid, together with any interest or other
earnings earned thereon, to the Corporation, and after any such repayment, the
holders of the shares

                                       6



entitled to the funds so repaid to the Corporation shall look only to the
Corporation for payment without interest or other earnings.

                                    (C) Limitations on Redemption.

                                             (1) The Series B Redemption Price
(other than the portion thereof consisting of accrued and unpaid dividends)
shall be payable solely out of the sale proceeds of other capital stock of the
Corporation and from no other source.

                                             (2) Unless full cumulative
dividends on all shares of Series B Preferred shall have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for all past Dividend Periods and the then
current Dividend Period, no Series B Preferred shall be redeemed (unless all
outstanding shares of Series B Preferred are simultaneously redeemed) or
purchased or otherwise acquired directly or indirectly (except by exchange for
Junior Stock); provided, however, that the foregoing shall not prevent the
exchange of Series B Preferred pursuant to Article VI or the purchase or
acquisition of Series B Preferred pursuant to a purchase or exchange offer made
on the same terms to holders of all outstanding shares of Series B Preferred.

                                    (D) Rights to Dividends on shares Called for
Redemption. If the Series B Redemption Date is after a Dividend Record Date and
before the related Dividend Payment Date, the dividend payable on such Dividend
Payment Date shall be paid to the holder in whose name the shares of Series B
Preferred to be redeemed are registered at the close of business on such
Dividend Record Date notwithstanding the redemption thereof between such
Dividend Record Date and the related Dividend Payment Date or the Corporation's
default in the payment of the dividend due. Except as provided in this paragraph
(v), the Corporation will make no payment or allowance for unpaid dividends,
whether or not in arrears, on called Series B Preferred.

                           (vi) Voting Rights.  Except as required by the
general laws of the State of Maryland and except as otherwise provided in this
paragraph (vi), the holders of the Series B Preferred shall not be entitled to
vote at any meeting of the stockholders for election of directors or for any
other purpose or otherwise to participate in any action taken by the Corporation
or the stockholders thereof, or to receive notice of any meeting of
stockholders.

                                    (A) Whenever dividends on any shares of
Series B Preferred shall be in arrears for six or more consecutive quarterly
periods, the holders of such shares of Series B Preferred (voting separately as
a class with all other series of preferred stock upon which like voting rights
have been conferred and are exercisable) will be entitled to vote for the
election of two additional directors of the Corporation at a special meeting
called by the holders of record of at least 10% of the Series B Preferred or the
holders of any other series of preferred stock so in arrears (unless such
request is received less than 90 days before the date fixed for the next annual
or special meeting of the stockholders) or at the next annual meeting of
stockholders, and at each subsequent annual meeting until all dividends
accumulated on such shares of Series B Preferred for the past Dividend Periods
and the then current Dividend Period shall have been fully paid or declared and
a sum sufficient for the payment thereof set aside for payment. In such case,
the entire Board will be increased by two directors.

                                    (B) So long as any shares of Series B
Preferred remain outstanding, the Corporation shall not, without the affirmative
vote of the holders of at least a majority of the shares of the Series B
Preferred outstanding at the time, (1) authorize or create, or increase the
authorized or issued amount of, any class or series of capital stock ranking
prior to the Series B Preferred with respect to payment of dividends or the
distribution of assets upon liquidation, dissolution or winding

                                       7



up or reclassify any authorized capital stock of the Corporation into any such
shares, or create, authorize or issue any obligation or security convertible
into or evidencing the right to purchase any such shares; or (2) amend, alter or
repeal the provisions of this Charter, whether by merger, consolidation or
otherwise, so as to materially and adversely affect any right, preference,
privilege or voting power of the Series B Preferred or the holders thereof;
provided, however, that any increase in the amount of the authorized preferred
stock or the creation or issuance of any other series of preferred stock, or any
increase in the amount of authorized shares of such series, in each case ranking
on a parity with or junior to the Series B Preferred with respect to payment of
dividends or the distribution of assets upon liquidation, dissolution or winding
up, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.

                                    (C) The foregoing voting provisions will not
apply if, at or prior to the time when the act with respect to which such vote
would otherwise be required shall be effected, all outstanding shares of Series
B Preferred shall have been redeemed or called for redemption upon proper notice
and sufficient funds shall have been deposited in trust to effect such
redemption.

                                    (D) So long as the Series B Preferred is
listed or admitted to trading on The New York Stock Exchange, then
notwithstanding anything to the contrary in this Charter, including without
limitation Article VIII, approval by the holders of at least two-thirds of the
outstanding shares of the Series B Preferred shall be required for adoption of
any amendment of this Charter or of the Bylaws of the Corporation that would
materially affect the existing terms of the Series B Preferred.

                           (vii) Conversion of Series B Preferred. The Series B
Preferred is not convertible into or exchangeable for any other property or
securities of the Corporation except as provided in Article VI.

                  (b)      Series C Junior Participating Redeemable Preferred
Stock.

                           (i) Designation and Number.  A series of the
preferred stock, designated the "Series C Junior Participating Cumulative
Redeemable Preferred Stock" (the "Series C Preferred"), is hereby established.
The number of shares of the Series C Preferred shall be 1,000,000.

                           (ii) Relative Seniority.  In respect of rights to
receive dividends and to participate in distributions or payments in the event
of any liquidation, dissolution or winding up of the Corporation, the Series C
Preferred shall rank junior to the Series B Preferred and (notwithstanding
anything to the contrary in Section 5.4(c)(ii)) the Series D Preferred, and
senior to the Common Stock and any other capital stock of the Corporation
ranking, as to dividends and upon liquidation, junior to the Series C Preferred
(collectively, for purposes of this Section 5.4(b), "Junior Stock").

                           (iii) Dividends. The holders of the then outstanding
Series C Preferred shall be entitled to receive, when and as declared by the
Board out of any funds legally available therefor, cumulative preferential cash
dividends payable quarterly on March 31, June 30, September 30 and December 31
(each such date being referred to herein as a "Quarterly Dividend Payment Date"
and each period beginning on the day next following a Quarterly Dividend Payment
Date and ending on the next following Quarterly Dividend Payment Date being
referred to herein as a "Dividend Period"), commencing on the first Quarterly
Dividend Payment Date after the first issuance of a share or fraction of a share
of Series C Preferred, in an amount per share (rounded to the nearest cent)
equal to the greater of (A) $.01 or (B) subject to adjustment hereinafter set
forth, 1,000 times the aggregate per share amount of all cash dividends, and
1,000 times the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions (other than dividends payable in shares of
Common Stock, as constituted on the date of such payment), declared on the
Common Stock since the immediately preceding Quarterly

                                       8



Dividend Payment Date, or, with respect to the first Quarterly Dividend Payment
Date, since the first issuance of any share or fraction of a share of Series C
Preferred.

                           In the event the Corporation shall at any time after
February 4, 1998 (the "Rights Dividend Declaration Date"), (A) declare any
dividend on the Common Stock payable in shares of Common Stock, (B) subdivide
the outstanding Common Stock, or (C) combine the outstanding shares of Common
Stock into a smaller number of shares, then in each such case the amount to
which holders of shares of the Series C Preferred were entitled immediately
prior to such event under clause (B) of the preceding paragraph shall be
adjusted by multiplying such amount by a fraction (the "Adjustment Factor"), the
numerator of which is the number of shares of Common Stock outstanding
immediately after such event and the denominator of which is the number of
shares of Common Stock outstanding immediately prior to such event.

                           The Corporation shall declare a dividend or
distribution on the Series C Preferred immediately after it declares a dividend
or distribution on the Common Stock (other than a dividend payable in shares of
Common Stock); provided that, in the event no dividend or distribution shall
have been declared on the Common Stock during the period between any Quarterly
Dividend Payment Date and the next subsequent Quarterly Dividend Payment Date, a
dividend at the rate of $.01 per share on the Series C Preferred shall
nevertheless be declared payable on such subsequent Quarterly Dividend Payment
Date.

                           Dividends on the shares of Series C Preferred shall
accrue and be cumulative from and including the Quarterly Dividend Payment Date
next preceding the date of issue of such shares of Series C Preferred, unless
the date of issue of such shares is prior to the record date for the first
Quarterly Dividend Payment Date, in which event dividends on such shares shall
accrue and be cumulative from and including the date of issue of such shares, or
unless the date of issue is a Quarterly Dividend Payment Date or is a date after
the record date for the determination of holders of shares of Series C Preferred
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall accrue and be
cumulative from and including such Quarterly Dividend Payment Date, whether or
not (A) the Corporation has earnings, (B) dividends on such shares are declared
or (C) on any Quarterly Dividend Payment Date there shall be funds legally
available for the payment of such dividends. When dividends are not paid in full
upon the shares of Series C Preferred and the shares of any other series of
preferred stock ranking on a parity as to dividends with the Series C Preferred
(or a sum sufficient for such full payment is not set apart therefor), all
dividends declared upon shares of Series C Preferred and any other series of
preferred stock ranking on a parity as to dividends with the Series C Preferred
shall be declared pro rata so that the amount of dividends declared per share on
the Series C Preferred and such other series of preferred stock shall in all
cases bear to each other the same ratio that accrued dividends per share on the
shares of Series C Preferred and such other series of preferred stock bear to
each other.

                           Except as provided in the immediately preceding
paragraph, unless full cumulative dividends on the Series C Preferred have been
or contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for payment on the Series C Preferred for all past
dividend periods and the then current dividend period, (A) no dividends shall be
declared or paid or set apart for payment on the preferred stock of the
Corporation ranking, as to dividends, on a parity with or junior to the Series C
Preferred for any period, and (B) no dividends (other than in Junior Stock)
shall be declared or paid or set aside for payment or other distribution or
shall be declared or made upon the Junior Stock or any other capital stock of
the Corporation ranking on a parity with the Series C Preferred as to dividends
or upon liquidation (for purposes of this Section 5.4(b), "Parity Stock"), nor
shall any Junior Stock or any Parity Stock be redeemed, purchased or otherwise
acquired for any consideration (or any moneys be paid to or made available for a
sinking fund for the redemption of any

                                       9



shares of Junior Stock or Parity Stock) by the Corporation (except by conversion
into or exchange for Junior Stock).

                           Any dividend payment made on shares of the Series C
Preferred shall first be credited against the earliest accrued but unpaid
dividend due with respect to such shares which remains payable.

                           No dividends on shares of Series C Preferred shall be
declared by the Board or paid or set apart for payment by the Corporation at
such time as the terms and provisions of any agreement of the Corporation,
including any agreement relating to its indebtedness, prohibits such
declaration, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereunder, or if such declaration or payment shall be
restricted or prohibited by law.

                           Accrued but unpaid dividends on the Series C
Preferred will not bear interest. Holders of the Series C Preferred will not be
entitled to any dividends in excess of full cumulative dividends as described
above.

                           Except as provided in this Charter, the Series C
Preferred shall not be entitled to participate in the earnings or assets of the
Corporation.

                           The Board may fix a record date for the determination
of holders of shares of Series C Preferred entitled to receive payment of a
dividend or distribution declared thereon, which record date shall be no more
than 30 days prior to the date fixed for the payment thereof.

                           (iv) Liquidation Rights.

                                (A) Upon the voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the holders of shares
of the Series C Preferred then outstanding shall be entitled to receive and to
be paid out of the assets of the Corporation legally available for distribution
to its stockholders, before any distribution shall be made to the holders of
Common Stock or any other capital stock of the Corporation ranking junior to the
Series C Preferred upon liquidation, a liquidation preference of $1,000.00 per
share, plus accrued and unpaid dividends thereon to the date of payment (the
"Series C Preferred Liquidation Preference").

                                (B) After the payment to the holders of the
shares of the Series C Preferred of the full Series C Preferred Liquidation
Preference, the holders of the Series C Preferred as such shall have no right or
claim to any of the remaining assets of the Corporation until the holders of
Common Stock shall have received an amount per share (the "Common Adjustment")
equal to the quotient obtained by dividing (1) the Series C Preferred
Liquidation Preference by (2) 1,000 (as appropriately adjusted as set forth in
paragraph (D) below to reflect such events as stock splits, stock dividends and
recapitalizations with respect to the Common Stock) (the number determined
pursuant to clause (2) being hereinafter referred to as the "Adjustment
Number"). Following the payment of the full amount of the Series C Preferred
Liquidation Preference in respect of all outstanding shares of Series C
Preferred, the full amount of any liquidation preference payable to holders of
any other shares of stock of the Corporation ranking as to any distribution upon
any voluntary or involuntary dissolution, liquidation or winding up of the
Corporation on a parity with the shares of the Series C Preferred and the full
amount of the Common Adjustment, respectively, holders of shares of Series C
Preferred, holders of such other shares and holders of shares of Common Stock
shall receive their ratable and proportionate share of the remaining assets to
be distributed in the ratio of the Adjustment Number to 1 with respect to such
shares of Series C Preferred, such other shares and shares of Common Stock, on a
per share basis, respectively.

                                       10



                                    (C) If, upon any voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the amounts payable
with respect to the Series C Preferred Liquidation Preference and the
liquidation preference of any other shares of stock of the Corporation ranking
as to any such distribution on a parity with the shares of the Series C
Preferred are not paid in full, the holders of the shares of the Series C
Preferred and of such other shares will share ratably in any such distribution
of assets of the Corporation in proportion to the full respective liquidation
preferences to which they are entitled. In the event, however, that there are
not sufficient assets available after payment in full of the Series C Preferred
Liquidation Preference and such other liquidation preferences to permit payment
in full of the Common Adjustment, then the remaining assets shall be distributed
ratably to the holders of the Common Stock.

                                    (D) In the event the Corporation shall at
any time after the Rights Dividend Declaration Date (1) declare any dividend on
the Common Stock payable in shares of Common Stock, (2) subdivide the
outstanding Common Stock, or (3) combine the outstanding shares of Common Stock
into a smaller number of shares, then in each such case the Adjustment Number in
effect immediately prior to such event shall be adjusted by multiplying such
Adjustment Number by the Adjustment Factor.

                                    (E) Neither the sale, lease, transfer or
conveyance of all or substantially all the property or business of the
Corporation, nor the merger or consolidation of the Corporation into or with any
other Corporation or the merger or consolidation of any other Corporation into
or with the Corporation, shall be deemed to be a dissolution, liquidation or
winding up, voluntary or involuntary, for the purposes of this paragraph (iv).

                           (v) Redemption.

                                    (A) Right of Optional Redemption. The
outstanding shares of Series C Preferred may be redeemed at the option of the
Board as a whole, but not in part, at any time, or from time to time, at a price
per share (the "Series C Redemption Price") equal to (1) 100% of the product of
the Adjustment Number times the Average Market Value (as such term is
hereinafter defined) of the Common Stock, plus (2) all accrued and unpaid
dividends to and including the date fixed for redemption (the "Series C
Redemption Date"). The "Average Market Value" is the average of the closing sale
prices of a share of the Common Stock during the 30-day period immediately
preceding the date before the redemption date quoted on the Composite Tape for
New York Stock Exchange Listed Stocks, or, if the Common Stock is not quoted on
the Composite Tape, on The New York Stock Exchange, or, if the Common Stock is
not listed on such exchange, on the principal United States securities exchange
registered under the Securities Exchange Act of 1934, as amended, on which the
Common Stock is listed, or, if the Common Stock is not listed on any such
exchange, the average of the closing bid quotations with respect to a share of
Common Stock during such 30-day period on The NASDAQ Stock Market, or if no such
quotations are available, the fair market value of a share of Common Stock as
determined by the Board in good faith.

                                    (B) Procedures for Redemption.

                                             (1) Notice of any redemption will
be (a) given by publication in a newspaper of general circulation in the City of
New York, New York, such publication to be made once a week for two successive
weeks commencing not less than 30 nor more than 60 days prior to the Series C
Redemption Date, and (b) mailed by the Corporation, postage prepaid, not less
than 30 nor more than 60 days prior to the Series C Redemption Date, addressed
to the respective holders of record of the Series C Preferred to be redeemed at
their respective addresses as they appear on the stock transfer records of the
Corporation. No failure to give such notice or any defect therein or in the
mailing thereof

                                       11



shall affect the validity of the proceedings for the redemption of any Series C
Preferred except as to the holder to whom the Corporation has failed to give
notice or except as to the holder to whom notice was defective. In addition to
any information required by law or by the applicable rules of any exchange upon
which Series C Preferred may be listed or admitted to trading, such notice shall
state: (a) the Series C Redemption Date; (b) the Series C Redemption Price; (c)
the place or places where certificates for Series C Preferred are to be
surrendered for payment of the Series C Redemption Price; and (d) that dividends
on the Series C Preferred will cease to accumulate on the Series C Redemption
Date.

                                             (2) If notice of redemption of the
Series C Preferred has been published and mailed in accordance with subparagraph
(v)(B)(1) above and provided that on or before the Series C Redemption Date
specified in such notice all funds necessary for such redemption shall have been
irrevocably set aside by the Corporation, separate and apart from its other
funds in trust for the benefit of the holders of the Series C Preferred, so as
to be, and to continue to be available therefor, then, from and after the Series
C Redemption Date, dividends on the Series C Preferred shall cease to accrue,
and the Series C Preferred shall no longer be deemed to be outstanding and all
rights of the holders thereof as stockholders of the Corporation (except the
right to receive the Series C Redemption Price) shall terminate. Upon surrender,
in accordance with said notice, of the certificates for the Series C Preferred
(properly endorsed or assigned for transfer, if the Corporation shall so require
and the notice shall so state), the Series C Preferred shall be redeemed by the
Corporation at the Series C Redemption Price.

                                             (3) The deposit of funds with a
bank or trust company for the purpose of redeeming Series C Preferred shall be
irrevocable except that:

                                                 (a) the Corporation shall be
entitled to receive from such bank or trust company the interest or other
earnings, if any, earned on any money so deposited in trust, and the holders of
any shares redeemed shall have no claim to such interest or other earnings; and

                                                 (b) any balance of moneys so
deposited by the Corporation and unclaimed by the holders of the Series C
Preferred entitled thereto at the expiration of two years from the applicable
Series C Redemption Date shall be repaid, together with any interest or other
earnings earned thereon, to the Corporation, and after any such repayment, the
holders of the shares entitled to the funds so repaid to the Corporation shall
look only to the Corporation for payment without interest or other earnings.

                                    (C) Rights to Dividends on Shares Called for
Redemption. If the Series C Redemption Date is after a record date for payment
of dividends on the Series C Preferred and before the related Quarterly Dividend
Payment Date, the dividend payable on such Quarterly Dividend Payment Date shall
be paid to the holders in whose name the shares of Series C Preferred are
registered at the close of business on such record date notwithstanding the
redemption thereof between such record date and the related Quarterly Dividend
Payment Date or the Corporation's default in the payment of the dividend due.
Except as provided in this paragraph (v), the Corporation will make no payment
or allowance for unpaid dividends, whether or not in arrears, on called Series C
Preferred.

                           (vi)     Voting Rights.

                                    (A) Subject to the provision for adjustment
hereinafter set forth, each share of Series C Preferred shall entitle the holder
thereof to 1,000 votes on all matters submitted to a vote of the stockholders of
the Corporation. In the event the Corporation shall at any time after the Rights
Declaration Date (1) declare any dividend on the Common Stock payable in shares
of Common Stock, (2) subdivide the outstanding Common Stock, or (3) combine the
outstanding shares of

                                       12



Common Stock into a smaller number of shares, then in each such case the number
of votes per share to which holders of shares of Series C Preferred were
entitled immediately prior to such event shall be adjusted by multiplying such
number by the Adjustment Factor. Except as otherwise provided herein or under
applicable law, the holders of shares of Series C Preferred and the holders of
shares of Common Stock shall vote together as one voting group on all matters
submitted to a vote of stockholders of the Corporation.

                                    (B) Whenever dividends on any shares of
Series C Preferred shall be in arrears for six or more consecutive quarterly
periods, the holders of such shares of Series C Preferred (voting separately as
a class with all other series of preferred stock upon which like voting rights
have been conferred and are exercisable) will be entitled to vote for the
election of two additional directors of the Corporation at a special meeting
called by the holders of record of at least 10% of the Series C Preferred or the
holders of any other series of preferred stock so in arrears (unless such
request is received less than 90 days before the date fixed for the next annual
or special meeting of the stockholders) or at the next annual meeting of
stockholders, and at each subsequent annual meeting until all dividends
accumulated on such shares of Series C Preferred for the past Dividend Periods
and the then current Dividend Period shall have been fully paid or declared and
a sum sufficient for the payment thereof set aside for payment. In such case,
the entire Board will be increased by two directors.

                                    (C) The foregoing voting provisions will not
apply if, at or prior to the time when the act with respect to which such vote
would otherwise be required shall be effected, all outstanding shares of Series
C Preferred shall have been redeemed or called for redemption upon proper notice
and sufficient funds shall have been deposited in trust to effect such
redemption.

                                    (D) In the event that the Series C Preferred
is listed or admitted to trading on The New York Stock Exchange, then
notwithstanding anything to the contrary in this Charter, including without
limitation Article VIII, approval by the holders of at least two-thirds of the
outstanding shares of the Series C Preferred shall be required for adoption of
any amendment of this Charter or of the Bylaws of the Corporation that would
materially affect the existing terms of the Series C Preferred.

                           (vii)    Conversion of Series C Preferred. The Series
C Preferred is not convertible into or exchangeable for any other property or
securities of the Corporation except as provided in Article VI.

                           (viii)   Consolidation, Merger, Share Exchange, etc.
In case the Corporation shall enter into any consolidation, merger, share
exchange, combination or other transaction in which the shares of Common Stock
are exchanged for or changed into other stock or securities, cash and/or any
other property, then in any such case the shares of Series C Preferred shall at
the same time be similarly exchanged or changed in an amount per share (subject
to the provision for adjustment hereinafter set forth) equal to 1,000 times the
aggregate amount of stock, securities, cash and/or any other property (payable
in kind), as the case may be, into which or for which each share of Common Stock
is changed or exchanged. In the event the Corporation shall at any time after
the Rights Dividend Declaration Date (A) declare any dividend on the Common
Stock payable in shares of Common Stock, (B) subdivide the outstanding Common
Stock, or (C) combine the outstanding shares of Common Stock into a smaller
number of shares, then in each such case the amount set forth in the preceding
sentence with respect to the exchange or change of shares of Series C Preferred
shall be adjusted by multiplying such amount by the Adjustment Factor.

                           (ix)     Fractional Shares. Series C Preferred may be
issued in fractions of one one-thousandth of a share (and integral multiples
thereof) which shall entitle the holder, in proportion to

                                       13



such holders' fractional shares, to exercise voting rights, receive dividends,
participate in distributions and to have the benefit of all other rights of
holders of Series C Preferred.

                  (c) Series D Cumulative Convertible Preferred Stock.

                      (i) Designation and Number. A series of the preferred
stock, designated the "Series D Cumulative Convertible Redeemable Preferred
Stock" (the "Series D Preferred"), is hereby established. The number of shares
of the Series D Preferred shall be 8,000,000.

                      (ii) Relative Seniority. In respect of rights to receive
dividends and to participate in distributions or payments in the event of any
liquidation, dissolution or winding up of the Corporation, the Series D
Preferred shall rank on a parity with the Series B Preferred and the Series C
Preferred and any other class or series of capital stock of the Corporation not
constituting Junior Stock (collectively, for purposes of this Section 5.4(c),
"Parity Stock"), and senior to the Common Stock and any other class or series of
capital stock of the Corporation ranking, as to dividends and upon liquidation,
junior to the Series D Preferred (collectively, for purposes of this Section
5.4(c), "Junior Stock").

                      (iii) Dividends.

                            (A) The holders of the then outstanding Series D
Preferred shall be entitled to receive, when and as declared by the Board of any
funds legally available therefor, cumulative preferential cash dividends at the
rate of 7.5% of the Liquidation Preference of the Series D Preferred (equivalent
to $1.875 per share) per annum (subject to adjustment as provided in
subparagraph (F) of this paragraph (iii)), payable quarterly in arrears in cash
on the last day, or the next succeeding Business Day, of January, April, July
and October in each year, beginning February 1, 1999 (each such day being
hereinafter called a "Dividend Payment Date" and each period beginning on the
day next following a Dividend Payment Date and ending on the next following
Dividend Payment Date being hereinafter called a "Dividend Period"), to
stockholders of record at the close of business on the Friday occurring between
the tenth and fifteenth days of the calendar month in which the applicable
Dividend Payment Date falls on or such date as shall be fixed by the Board at
the time of declaration of the dividend (the "Dividend Record Date"), which
shall be not less than 10 nor more than 30 days preceding the Dividend Payment
Date. The amount of any dividend payable for the initial Dividend Period and for
any other partial Dividend Period shall be computed on the basis of a 360-day
year consisting of twelve 30-day months. Dividends on the shares of Series D
Preferred shall accrue and be cumulative from and including the date of original
issue thereof (the "Issue Date"), whether or not (1) the Corporation has
earnings, (2) dividends on such shares are declared or (3) on any Dividend
Payment Date there shall be funds legally available for the payment of such
dividends. When dividends are not paid in full upon the shares of Series D
Preferred and the shares of any other series of preferred stock ranking on a
parity as to dividends with the Series D Preferred (or a sum sufficient for such
full payment is not set apart therefor), all dividends declared upon shares of
Series D Preferred and any other series of preferred stock ranking on a parity
as to dividends with the Series D Preferred shall be declared pro rata so that
the amount of dividends declared per share on the Series D Preferred and such
other series of preferred stock shall in all cases bear to each other the same
ratio that accrued dividends per share on the shares of Series D Preferred and
such other series of preferred stock bear to each other. "Business Day" shall
mean any day, other than a Saturday or Sunday, that is neither a legal holiday
nor a day on which banking institutions in New York City, New York are
authorized or required by law, regulation or executive order to close.

                            (B) Except as provided in subparagraph (A) of this
paragraph (iii), unless full cumulative dividends on the Series D Preferred have
been or contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof set apart for payment on the Series D Preferred for all
past dividend periods and the then current dividend

                                       14



period, no dividends (other than in Junior Stock) shall be declared or paid or
set aside for payment or other distribution or shall be declared or made upon
any Parity Stock or Junior Stock, nor shall any Junior Stock or any Parity Stock
be redeemed, purchased or otherwise acquired for any consideration (or any
moneys be paid to or made available for a sinking fund for the redemption of any
shares of Junior Stock or Parity Stock) by the Corporation or any subsidiary of
the Corporation (except by conversion into or exchange for Junior Stock).

                                    (C) Any dividend payment made on shares of
the Series D Preferred shall first be credited against the earliest accrued but
unpaid dividend due with respect to such shares which remains payable.

                                    The amount of any dividends accrued on any
shares of Series D Preferred at any Dividend Payment Date shall be the amount of
any unpaid dividends accumulated thereon, to and including such Dividend Payment
Date, whether or not earned or declared, and the amount of dividends accrued on
any shares of Series D Preferred at any date other than a Dividend Payment Date
shall be equal to the sum of the amount of any unpaid dividends accumulated
thereon, to and including the last preceding Dividend Payment Date, whether or
not earned or declared, plus an amount calculated on the basis of the annual
dividend rate for the period after such last preceding Dividend Payment Date to
and including the date as of which the calculation is made, based on a 360-day
year of twelve 30-day months.

                                    Accrued but unpaid dividends on the Series D
Preferred will not bear interest. Holders of the Series D Preferred will not be
entitled to any dividends in excess of full cumulative dividends as described
above.

                                    (D) No dividends on shares of Series D
Preferred shall be declared by the Board or paid or set apart for payment by the
Corporation at such time as the terms and provisions of any agreement of the
Corporation, including any agreement relating to its indebtedness, prohibits
such declaration, payment or setting apart for payment or provides that such
declaration, payment or setting apart for payment would constitute a breach
thereof or a default thereunder, or if such declaration or payment shall be
restricted or prohibited by law.

                                    (E) Except as provided in this Charter, the
Series D Preferred shall not be entitled to participate in the earnings or
assets of the Corporation.

                                    (F) In the event that the per share cash
dividends declared on the Common stock during any Dividend Period (the "Current
Common Dividend") shall be greater or less than the per share cash dividends
declared on the Common Stock during the immediately preceding Dividend Period
(the "Prior Common Dividend"), then the dividend rate of the Series D Preferred
(as it may have previously been adjusted pursuant to this subparagraph (F))
shall be automatically adjusted in the proportion that the Current Common
Dividend bears to the Prior Common Dividend, such adjustment to be effective for
the Dividend Period during which the Current Common Dividend is paid and all
subsequent Dividend Periods until again adjusted in accordance with this
paragraph; provided, however, that in no event shall the adjusted dividend rate
of the Series D Preferred be less than 7.5% of the Liquidation Preference of the
Series D Preferred per annum. No adjustment pursuant to this subparagraph (F)
shall be made on account of any special Common Stock dividend or distribution
declared for the purpose of assuring continued qualification of the Corporation
as a "real estate investment trust" under the Code.

                                       15



                           (iv) Liquidation Rights.

                                (A) Upon the voluntary or involuntary
dissolution, liquidation or winding up of the Corporation, the holders of shares
of the Series D Preferred then outstanding shall be entitled to receive and to
be paid out of the assets of the Corporation legally available for distribution
to its stockholders, before any distribution shall be made to the holders of
Common Stock or any other capital stock of the Corporation ranking junior to the
Series D Preferred upon liquidation, a liquidation preference of $25.00 per
share (the "Liquidation Preference"), plus accrued and unpaid dividends thereon
to the date of payment.

                                (B) After the payment to the holders of the
shares of the Series D Preferred of the full Liquidation Preference provided for
in this paragraph (iv), the holders of the Series D Preferred as such shall have
no right or claim to any of the remaining assets of the Corporation.

                                (C) If, upon any voluntary or involuntary
dissolution, liquidation, or winding up of the Corporation, the amounts payable
with respect to the Liquidation Preference and any other shares of stock of the
Corporation ranking as to any such distribution on a parity with the shares of
the Series D Preferred are not paid in full, the holders of the shares of the
Series D Preferred and of such other shares will share ratably in any such
distribution of assets of the Corporation in proportion to the full respective
liquidation preferences to which they are entitled.

                                (D) Neither the sale, lease, transfer or
conveyance of all or substantially all the property or business of the
Corporation, nor the merger or consolidation of the Corporation into or with any
other Corporation or the merger or consolidation of any other Corporation into
or with the Corporation, shall be deemed to be a dissolution, liquidation or
winding up, voluntary or involuntary, for the purposes of this paragraph (iv).

                           (v) Redemption.

                                (A) Right of Optional Redemption. The Series D
Preferred is not redeemable prior to the fifth anniversary of the Issue Date. On
and after the fifth anniversary of the Issue Date, the Corporation may, at its
option, redeem at any time all or, from time to time, part of the Series D
Preferred at a price per share (the "Series D Redemption Price"), payable in
cash, of $25.00, together with all accrued and unpaid dividends to and including
the date fixed for redemption (the "Series D Redemption Date"), without
interest; provided, however, that the Corporation may not redeem any Series D
Preferred pursuant to this paragraph (v) unless the Current Market Price of the
Common Stock on each of the 20 consecutive Trading Days immediately preceding
the Series D Redemption Date shall at least equal the then current Conversion
Price, as defined in paragraph (vii). "Current Market Price" of the Common Stock
or any other class of capital stock or other security of the Corporation or any
other issuer for any day shall mean the last reported sale price, regular way,
on such day or, if no sale takes place on such day, the average of the reported
closing bid and asked prices on such day, regular way, in either case as
reported on the New York Stock Exchange ("NYSE") or, if such security is not
listed or admitted for trading on the NYSE, on the principal national securities
exchange on which such security is listed or admitted for trading or, if not
listed or admitted for trading on any national securities exchange, on the
NASDAQ National Market or, if such security is not quoted on the NASDAQ National
Market, the average of the closing bid and asked prices on such day in the
over-the-counter market as reported by NASDAQ or, if bid and asked prices for
such security on such day shall not have been reported through NASDAQ, the
average of the bid and asked prices on such day as furnished by any NYSE member
firm regularly making a market in such security and selected for such purpose by
the Board. "Trading Day" in respect of any security shall mean any day on which
such security is traded on the NYSE, or if such security is not listed or
admitted for trading on the NYSE, on the principal national

                                       16



securities exchange on which such security is listed or admitted for trading, or
if not listed or admitted for trading on any national securities exchange, on
the NASDAQ National Market or, if such security is not quoted on the NASDAQ
National Market, in the applicable securities market in which the security is
traded.

                                    In case of redemption of less than all
shares of Series D Preferred at the time outstanding, the shares of Series D
Preferred to be redeemed shall be selected pro rata from the holders of record
of such shares in proportion to the number of shares of Series D Preferred held
by such holders (as nearly as may be practicable without creating fractional
shares) or by any other equitable method determined by the Corporation.

                                    (B) Procedures for Redemption.

                                             (1) Notice of any redemption will
be mailed by the Corporation, postage prepaid, not less than 30 nor more than 60
days prior to the Series D Redemption Date, addressed to the respective holders
of record of the Series D Preferred to be redeemed at their respective addresses
as they appear on the stock transfer records of the Corporation. No failure to
give such notice or any defect therein or in the mailing thereof shall affect
the validity of the proceedings for the redemption of any Series D Preferred
except as to the holder to whom the Corporation has failed to give notice or
except as to the holder to whom notice was defective. In addition to any
information required by law, such notice shall state: (a) the Series D
Redemption Date; (b) the Series D Redemption Price; (c) the number of shares of
Series D Preferred to be redeemed; (d) the place or places where certificates
for such shares are to be surrendered for payment of the Series D Redemption
Price; and (e) that dividends on the shares to be redeemed will cease to
accumulate on the Series D Redemption Date. If less than all the shares of
Series D Preferred held by any holder are to be redeemed, the notice mailed to
such holder shall also specify the number of shares of Series D Preferred held
by such holder to be redeemed.

                                             (2) If notice of redemption of any
shares of Series D Preferred has been mailed in accordance with section (1) of
subparagraph (B) of this paragraph (v) above and provided that on or before the
Series D Redemption Date specified in such notice all funds necessary for such
redemption shall have been irrevocably set aside by the Corporation, separate
and apart from its other funds in trust for the benefit of any holders of the
shares of Series D Preferred so called for redemption, so as to be, and to
continue to be available therefor, then, from and after the Series D Redemption
Date, dividends on such shares of Series D Preferred shall cease to accrue, and
such shares shall no longer be deemed to be outstanding and shall not have the
status of Series D Preferred and all rights of the holders thereof as
stockholders of the Corporation (except the right to receive the Series D
Redemption Price) shall terminate. Upon surrender, in accordance with said
notice, of the certificates for any shares of Series D Preferred so redeemed
(properly endorsed or assigned for transfer, if the Corporation shall so require
and the notice shall so state), such shares of Series D Preferred shall be
redeemed by the Corporation at the Series D Redemption Price. In case less than
all the shares of Series D Preferred represented by any such certificate are
redeemed, a new certificate or certificates shall be issued representing the
unredeemed shares of Series D Preferred without cost to the holder thereof.

                                             (3) The deposit of funds with a
bank or trust company for the purpose of redeeming Series D Preferred shall be
irrevocable except that:

                                                      (a) the Corporation shall
be entitled to receive from such bank or trust company the interest or other
earnings, if any, earned on any money so deposited in trust, and the holders of
any shares redeemed shall have no claim to such interest or other earnings; and

                                       17



                                                      (b) any balance of moneys
so deposited by the Corporation and unclaimed by the holders of the Series D
Preferred entitled thereto at the expiration of two years from the applicable
Series D Redemption Date shall be repaid, together with any interest or other
earnings earned thereon, to the Corporation, and after any such repayment, the
holders of the shares entitled to the funds so repaid to the Corporation shall
look only to the Corporation for payment without interest or other earnings.

                                    (C) Limitations on Redemption.

                                             (1) The Series D Redemption Price
(other than the portion thereof consisting of accrued and unpaid dividends)
shall be payable solely out of the sale proceeds of other capital stock of the
Corporation and from no other source.

                                             (2) Unless full cumulative
dividends on all shares of Series D Preferred shall have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for all past Dividend Periods and the then
current Dividend Period, no Series D Preferred shall be redeemed (unless all
outstanding shares of Series D Preferred are simultaneously redeemed) or
purchased or otherwise acquired directly or indirectly by the Corporation
(except by exchange for Junior Stock); provided, however, that the foregoing
shall not prevent the exchange of Series D Preferred pursuant to Article VI or
the purchase or acquisition of Series D Preferred pursuant to a purchase or
exchange offer made on the same terms to holders of all outstanding shares of
Series D Preferred.

                                             (3) The Corporation shall not
redeem in any period of 12 consecutive months a number of shares of Series D
Preferred having an aggregate Liquidation Preference of more than $100,000,000,
provided that this restriction shall lapse and be of no further force or effect
if in any such period any holder of record of such number of shares of Series D
Preferred or shares of Common Stock issued on conversion of such number of
shares of Series D Preferred shall transfer beneficial ownership of such number
of shares of Series D Preferred or such Common Stock, or a combination of shares
of Series D Preferred and such Common Stock representing such number of shares
of Series D Preferred, except (a) in a distribution of such shares of Series D
Preferred and/or shares of Common Stock to the security holders of such holder
of record or (b) in a bona fide pledge to a bank or other financial institution
to secure obligations for borrowed money, or as margin collateral, or upon
foreclosure or private sale under such pledge.

                                    (D) Rights to Dividends on Shares Called for
Redemption. If the Series D Redemption Date is after a Dividend Record Date and
before the related Dividend Payment Date, the dividend payable on such Dividend
Payment Date shall be paid to the holder in whose name the shares of Series D
Preferred to be redeemed are registered at the close of business on such
Dividend Record Date notwithstanding the redemption thereof between such
Dividend Record Date and the related Dividend Payment Date or the Corporation's
default in the payment of the dividend due. Except as provided in this paragraph
(v), the Corporation will make no payment or allowance for unpaid dividends,
whether or not in arrears, on called Series D Preferred.

                           (vi) Voting Rights. Except as required by the general
laws of the State of Maryland and except as otherwise provided in this paragraph
(vi), the holders of the Series D Preferred shall not be entitled to vote at any
meeting of the stockholders for election of directors or for any other purpose
or otherwise to participate in any action taken by the Corporation or the
stockholders thereof, or to receive notice of any meeting of stockholders.

                                       18



                                    (A) Whenever dividends on any shares of
Series D Preferred shall be in arrears for any Dividend Period, the holders of
such shares of Series D Preferred shall have all rights to notices and voting
entitlements of holders of Common Stock under the general laws of the State of
Maryland and this Charter, and the Series D Preferred and the Common Stock shall
be a single voting group, until all dividends accumulated on such shares of
Series D Preferred for all past Dividend Periods and the then current Dividend
Period shall have been fully paid or declared and a sum sufficient for the
payment thereof set aside for payment.

                                    (B) So long as any shares of Series D
Preferred remain outstanding, the Corporation shall not, without the affirmative
vote of the holders of at least a majority of the shares of the Series D
Preferred outstanding at the time, (i) authorize or create, or increase the
authorized or issued amount of, any class or series of capital stock ranking
prior to the Series D Preferred with respect to payment of dividends or the
distribution of assets upon liquidation, dissolution or winding up or reclassify
any authorized capital stock of the Corporation into any such shares, or create,
authorize or issue any obligation or security convertible into or evidencing the
right to purchase any such shares; or (ii) amend, alter or repeal the provisions
of this Charter, whether by merger, consolidation or otherwise, so as to
materially and adversely affect any right, preference, privilege or voting power
of the Series D Preferred or the holders thereof; provided, however, that any
increase in the amount of the authorized preferred stock or the creation or
issuance of any other series of preferred stock, or any increase in the amount
of authorized shares of such series, in each case ranking on a parity with or
junior to the Series D Preferred with respect to payment of dividends or the
distribution of assets upon liquidation, dissolution or winding up, shall not be
deemed to materially and adversely affect such rights, preferences, privileges
or voting powers.

                                    (C) The foregoing voting provisions will not
apply if, at or prior to the time when the act with respect to which such vote
would otherwise be required shall be effected, all outstanding shares of Series
D Preferred shall have been redeemed or called for redemption upon proper notice
and sufficient funds shall have been deposited in trust to effect such
redemption.

                           (vii)    Conversion of Series D Preferred.

                                    (A) As used in this paragraph (vii), the
following terms shall have the indicated meanings:

                                    "Adjustment Factor," for purposes of any
determination provided for in this paragraph (vii) requiring reference to the
Adjustment Factor, shall equal the Conversion Price in effect on the
determination date divided by $16.25.

                                    "Conversion Price" shall mean the conversion
price per share of Common Stock at which the Series D Preferred is convertible
into Common Stock, as such Conversion Price may be adjusted pursuant to
subparagraph (E) of this paragraph (vii). The initial Conversion Price shall be
$16.25.

                                    "Conversion Rate" shall mean the rate at
which the Series D Preferred is convertible into Common Stock, as such
Conversion Rate may be adjusted pursuant to subparagraph (E) of this paragraph
(vii). The initial Conversion Rate shall be 1.5385 shares of Common Stock for
each share of Series D Preferred.

                                    "Fair Market Value," in the case of any
security or property not having a market value ascertainable by reference to any
quotation medium or other objective source, shall mean

                                       19



the fair market value thereof as determined in good faith by the Board, which
determination shall be final, conclusive and binding on all persons.

                                    "Transfer Agent" shall mean Mellon Investor
Services, LLC, or such other agent or agents of the Corporation as may be
designated by the Board as the transfer agent for the Series D Preferred.

                                    (B) Subject to and upon compliance with the
provisions of this paragraph (vii), a holder of shares of Series D Preferred
shall have the right (the "Conversion Right"), at such holder's option, at any
time and from time to time, to convert such shares into the number of shares of
fully paid and nonassessable Common Stock obtained by dividing the aggregate
Liquidation Preference of such shares of Series D Preferred by the Conversion
Price (as in effect at the time and on the date provided for in the last
paragraph of subparagraph (C) of this paragraph (vii)) by surrendering such
shares to be converted, such surrender to be made in the manner provided in
subparagraph (C) of this paragraph (vii); provided, however, that the right to
convert shares called for redemption pursuant to paragraph (v) shall terminate
at the close of business on the Series D Redemption Date fixed for such
redemption, unless the Corporation shall default in making payment of any
amounts payable upon such redemption under paragraph (v).

                                    (C) In order to exercise the Conversion
Right, the holder of each share of Series D Preferred to be converted shall
surrender the certificate evidencing such share, duly endorsed or assigned to
the Corporation or in blank, at the office of the Transfer Agent, accompanied by
written notice to the Corporation that the holder thereof elects to convert such
share of Series D Preferred. Unless the certificate or certificates for shares
of Common Stock issuable on conversion are to be registered in the same name as
the name in which such certificate for Series D Preferred is registered, each
certificate surrendered for conversion shall be accompanied by instruments of
transfer, in form satisfactory to the Corporation, duly executed by the holder
or such holder's duly authorized agent and an amount sufficient to pay any
transfer or similar tax (or evidence reasonably satisfactory to the Corporation
demonstrating that such taxes have been paid).

                                    Holders of Series D Preferred at the close
of business on a Dividend Record Date shall be entitled to receive the dividend
payable on the corresponding Dividend Payment Date notwithstanding the
conversion thereof following such Dividend Record Date and prior to such
Dividend Payment Date. However, shares of Series D Preferred surrendered for
conversion during the period beginning with the close of business on any
Dividend Record Date and ending with the opening of business on the
corresponding Dividend Payment Date (except shares converted after the issuance
of a notice of redemption specifying a Series D Redemption Date occurring within
such period or coinciding with such Dividend Payment Date, such shares being
entitled to such dividend on the Dividend Payment Date) must be accompanied by
payment of an amount equal to the dividend payable on such shares on such
Dividend Payment Date. A holder of shares of Series D Preferred on a Dividend
Record Date who (or whose transferee) surrenders any such shares for conversion
into Common Stock after the opening of business on the corresponding Dividend
Payment Date will receive the dividend payable by the Corporation on such Series
D Preferred on such date, and the converting holder need not include payment of
the amount of such dividend upon such surrender. The Corporation shall make
further payment or allowance for, and a converting holder shall be entitled to,
unpaid dividends in arrears (excluding the then-current quarter) on converted
shares and for dividends on the Common Stock issued upon such conversion.

                                    As promptly as practicable after the
surrender of certificates for Series D Preferred as aforesaid, the Corporation
shall issue and shall deliver at such office to such holder, or on such holder's
written order, a certificate or certificates for the number of full shares of
Common Stock

                                       20



issuable upon the conversion of such Series D Preferred in accordance with the
provisions of this paragraph (vii), and any fractional interest in respect of
Common Stock arising upon such conversion shall be settled as provided in
subparagraph (D) of this paragraph (vii). Each conversion shall be deemed to
have been effected immediately prior to the close of business on the date on
which the certificates for Series D Preferred shall have been surrendered and
such notice (and if applicable, payment of an amount equal to the dividend
payable on such shares) received by the Corporation as aforesaid, and the person
or persons in whose name or names any certificate or certificates for Common
Stock shall be issuable upon such conversion shall be deemed to have become the
holder or holders of record of the shares represented thereby at such time on
such date, and such conversion shall be at the Conversion Price in effect at
such time and on such date, unless the share transfer books of the Corporation
shall be closed on that date, in which event such person or persons shall be
deemed to have become such holder or holders of record at the opening of
business on the next succeeding day on which such share transfer books are open,
but such conversion shall be at the Conversion Price in effect on the date on
which such certificates for Series D Preferred have been surrendered and such
notice received by the Corporation.

                                    (D) No fractional shares or scrip
representing fractions of Common Stock shall be issued upon conversion of the
Series D Preferred. In lieu of issuing a fractional interest in Common Stock
that would otherwise be deliverable upon the conversion of a share of Series D
Preferred, the Corporation shall pay to the holder of such share an amount in
cash based upon the Current Market Price of the Common Stock on the Trading Day
immediately preceding the date of conversion. If more than one share of Series D
Preferred shall be surrendered for conversion at one time by the same holder,
the number of full shares of Common Stock issuable upon conversion thereof shall
be computed on the basis of the aggregate number of shares of Series D Preferred
so surrendered.

                                    (E) The Conversion Rate and Conversion Price
shall be adjusted from time to time as follows:

                                        (1) If the Corporation shall after the
Issue Date (a) declare and pay a dividend to holders of any class of capital
stock of the Corporation payable in Common Stock, (b) subdivide its outstanding
Common Stock into a greater number of shares, (c) combine its outstanding Common
Stock into a smaller number of shares or (d) reclassify its Common Stock, the
Conversion Rate shall be adjusted so that the holder of any Series D Preferred
thereafter surrendered for conversion shall be entitled to receive the number of
shares of Common Stock that such holder would have owned or have been entitled
to receive after the happening of any of the events described above had such
shares been converted immediately prior to the record date in the case of a
dividend or the effective date in the case of a subdivision, combination or
reclassification. An adjustment made pursuant to this section (1) shall become
effective immediately after the opening of business on the day next following
the record date (except as provided in subparagraph (I) below) in the case of a
dividend and shall become effective immediately after the opening of business on
the day next following the effective date in the case of a subdivision,
combination or reclassification. Such adjustment(s) shall be made successively
whenever any of the events listed above shall occur.

                                        (2) If the Corporation shall issue after
the Issue Date rights, options or warrants to all holders of Common Stock
entitling them to subscribe for or purchase Common Stock (or securities
convertible into Common Stock) at a price per share (or having a conversion
price per share) less than 98% of the Current Market Price of the Common Stock
determined as of the record date for the determination of stockholders entitled
to receive such rights, options or warrants, then the Conversion Price shall be
adjusted to equal the price determined by multiplying (a) the Conversion Price
in effect immediately prior to the close of business on such record date by (b)
a fraction, the numerator of which shall be the sum of (i) the number of shares
of Common Stock outstanding on the close of business on such record date and
(ii) the number of shares of Common Stock that could be purchased at the

                                       21



Current Market Price of the Common Stock determined as of the record date for
the determination of stockholders entitled to receive such rights, options or
warrants, then the Conversion Price shall be adjusted to equal the price
determined by multiplying (a) the Conversion Price in effect immediately prior
to the close of business on such record date by (b) a fraction, the numerator of
which shall be the sum of (i) the number of shares of Common Stock outstanding
on the close of business on such record date and (ii) the number of shares of
Common Stock that could be purchased at the Current Market Price on such record
date with the aggregate proceeds to the Corporation from the exercise of such
rights, options or warrants (or the aggregate conversion price of the
convertible securities so offered), and the denominator of which shall be the
sum of (x) the number of shares of Common Stock outstanding on the close of
business on such record date and (y) the number of shares of Common Stock
issuable upon exercise in full of such rights, options or warrants (or into
which the convertible securities so offered are convertible). Such adjustment
shall become effective immediately after the opening of business on the day next
following such record date (except as provided in subparagraph (I) below). In
determining whether any rights, options or warrants entitle the holders of
Common Stock to subscribe for or purchase Common Stock at less than 98% of the
Current Market Price, there shall be taken into account any consideration
received by the Corporation upon issuance and upon exercise of such rights,
options or warrants, the value of such consideration, if other than cash, to be
determined by the Board, whose decision shall be final, conclusive, and binding
on all persons. Any adjustment(s) made pursuant to this section (2) shall be
made successively whenever any of the events listed above shall occur.

                                             (3) If the Corporation shall after
the Issue Date distribute to all holders of its Common Stock any shares of
capital stock of the Corporation (other than Common Stock) or evidence of its
indebtedness or assets (including securities or cash, but excluding cash
dividends not exceeding in amount current or accumulated funds from operations
at the date of declaration, determined on the basis of the Corporation's most
recent annual or quarterly report to stockholders at the time of the declaration
of such dividends) or rights, options or warrants to subscribe for or purchase
any of its securities (excluding rights, options or warrants referred to in
section (2) above) (any of the foregoing being hereinafter in this section (3)
called the "Securities"), then in each case the Conversion Price shall be
adjusted so that it shall equal the price determined by multiplying (a) the
Conversion Price in effect immediately prior to the close of business on the
record date fixed for the determination of stockholders entitled to receive such
distribution by (b) a fraction, the numerator of which shall be (i) the Current
Market Price per share of Common Stock on such record date or, if applicable,
the deemed record date described in the immediately following paragraph, less
(ii) the then Fair Market Value of the Securities or assets so distributed
applicable to one share of Common Stock, and the denominator of which shall be
the Current Market Price per share of Common Stock on such record date or, if
applicable, the record date described in the immediately following paragraph.
Such adjustment shall become effective immediately at the opening of business on
the Business Day next following (except as provided in subparagraph (i)) such
record date.

                                             For purposes of this section (3),
distribution of a Security which is distributed not only to the holders of the
Common Stock on the record date fixed for the determination of stockholders
entitled to such distribution, but is also delivered with each share of Common
Stock issued upon conversion of Series D Preferred after such record date, shall
not require an adjustment of the Conversion Price pursuant to this section (3);
provided that on the date, if any, on which such Security ceases to be
deliverable with Common Stock upon conversion of Series D Preferred (other than
as a result of the expiration or termination of all such Securities), a
distribution of such Securities shall be deemed to have occurred, and the
Conversion Price shall be adjusted as provided in this section (3) (and such
date shall be deemed for purposes of this section (3) to be the "record date
fixed for the determination of stockholders entitled to receive such
distribution" and the "record date").

                                             Adjustment(s) made pursuant to this
section (3) shall be made successively whenever any of the events listed above
shall occur.

                                             (4) If after the Issue Date (i) the
Corporation shall merge or consolidate with any other real estate investment
trust, corporation or other business entity and shall not be the survivor in
such transaction (without respect to the legal structure of the transaction),
(ii) the Corporation shall transfer or sell all or substantially all of its
assets other than to an affiliate or subsidiary

                                       22



of the Corporation or (iii) the Corporation shall liquidate and dissolve, and
the consideration allocable to each share of Common Stock in any such
transaction shall not have a Fair Market Value of at least $15 times the
Adjustment Factor, the Conversion Price in effect at the opening of business on
the date on which such transaction is consummated or effective, if greater than
$15 times the Adjustment Factor, shall be adjusted effective at the opening of
business on such date to equal $15 times the Adjustment Factor.

                                             (5) If the Current Market Price of
the Common Stock on at least 20 consecutive Trading Days during the period of 36
consecutive months beginning on the second anniversary of the Issue Date is not
at least $14 times the Adjustment Factor, and the Conversion Price in effect at
the opening of business on the fifth anniversary of the Issue Date or the next
succeeding Business Day, if such fifth anniversary is not a Business Day, is
greater than $15.25 times the Adjustment Factor, the Conversion Price shall be
adjusted effective at the opening of business on such fifth anniversary or the
next following Business Day, if such fifth anniversary is not a Business Day, to
equal $15.25 times the Adjustment Factor.

                                             (6) No adjustment in the Conversion
Price shall be required unless such adjustment would require a cumulative
increase or decrease of at least 1% in such price; provided, however, that any
adjustments that by reason of this section (6) are not required to be made shall
be carried forward and taken into account in any subsequent adjustment until
made; and provided, further, that any adjustment shall be required and made in
accordance with the provisions of this paragraph (vii) (other than this section
(6)) not later than such time as may be required in order to preserve the
tax-free nature of a dividend to the holders of Common Stock. Notwithstanding
any other provisions of this paragraph (vii), the Corporation shall not be
required to make any adjustment to the Conversion Price for the issuance of any
Common Stock pursuant to any plan providing for the reinvestment of dividends or
interest payable on securities of the Corporation and the investment of
additional optional amounts in Common Stock under such plan. All calculations
under this paragraph (vii) shall be made to the nearest cent (with $.005 being
rounded upward) or to the nearest one-tenth of a share (with .05 of a share
being rounded upward), as the case may be.

                                    (F) If the Corporation shall after the Issue
Date be a party to any transaction (including without limitation a merger,
consolidation, statutory share exchange, self tender offer for all or
substantially all of the outstanding Common Stock, sale of all or substantially
all of the Corporation's assets, recapitalization or reclassification of capital
stock, but excluding any transaction to which section (1) of subparagraph (E) of
this paragraph (vii) applies) (each of the foregoing being referred to herein as
a "Transaction"), in each case upon consummation of which Common Stock shall be
converted into the right to receive shares, stock, securities or other property
(including cash) or any combination thereof ("Transaction Consideration"), each
share of Series D Preferred which is not itself converted into the right to
receive Transaction Consideration in connection with such Transaction shall
thereafter be convertible into the kind and amount of Transaction Consideration
payable upon the consummation of such Transaction with respect to that number of
shares of Common Stock into which one share of Series D Preferred was
convertible immediately prior to such Transaction. The Corporation shall not be
a party to any Transaction unless the terms of such Transaction are consistent
with this subparagraph (F) and enable the holder of each share of Series D
Preferred that remains outstanding after consummation of such Transaction to
convert such share at the Conversion Price in effect immediately prior to such
Transaction into the Transaction Consideration payable with respect to the
number of shares of Common Stock into which such share of Series D Preferred is
then convertible. The provisions of this subparagraph (F) shall similarly apply
to successive Transactions.

                                       23



                                    (G)      If after the Issue Date:

                                             (1) the Corporation shall declare
dividends on the Common Stock, excluding cash dividends not exceeding in amount
current or accumulated funds from operations at the date of declaration,
determined on the basis of the Corporation's most recent annual or quarterly
report to stockholders at the time of the declaration of such dividends; or

                                             (2) the Corporation shall authorize
the granting to the holders of the Common Stock of rights, options or warrants
to subscribe for or purchase any shares of any class or any other rights,
options or warrants; or

                                             (3) there shall be any Transaction
for which approval of any stockholders of the Corporation is required or self
tender for all or substantially all of the outstanding Common Stock; or

                                             (4) there shall occur the voluntary
or involuntary liquidation, dissolution or winding up of the Corporation;

then the Corporation shall cause to be filed with the Transfer Agent and shall
cause to be mailed to the holders of the Series D Preferred at their addresses
as shown on the share records of the Corporation, as promptly as possible, but
at least 15 days prior to the earliest applicable date hereinafter specified, a
notice stating (a) the record date as of which the holders of Common Stock
entitled to receive such dividend or grant of rights, options or warrants are to
be determined, provided, however, that no such notification need be made in
respect of a record date for a dividend or grant of rights, options or warrants
unless the corresponding adjustment in the Conversion Price would be an increase
or decrease of at least 1%, or (b) the date on which such Transaction, self
tender, liquidation, dissolution or winding up is expected to become effective,
and the date as of which it is expected that holders of Common Stock of record
shall be entitled to exchange their Common Stock for securities or other
property, if any, deliverable upon such Transaction, self tender, liquidation,
dissolution or winding up. Failure to give such notice or any defect therein
shall not affect the legality or validity of the proceedings described in this
paragraph (vii).

                                    (H) Whenever the Conversion Price is
adjusted as herein provided, the Corporation shall promptly file with the
Transfer Agent a certificate of its chief financial or chief accounting officer
setting forth the Conversion Price after such adjustment and setting forth a
brief statement of the facts requiring such adjustment, which certificate shall
be conclusive evidence of the correctness of such adjustment absent manifest
error. Promptly after delivery of such certificate, the Corporation shall
prepare a notice of such adjustment of the Conversion Price setting forth the
adjusted Conversion Price and the effective date on which such adjustment
becomes effective and shall mail such notice of such adjustment of the
Conversion Price to the holder of each share of Series D Preferred at such
holder's last address of record.

                                    (I) In any case in which subparagraph (E) of
this paragraph (vii) provides that an adjustment shall become effective on the
date next following the record date for an event, the Corporation may defer
until the occurrence of such event (1) issuing to the holder of any Series D
Preferred converted after such record date and before the occurrence of such
event the additional Common Stock issuable upon such conversion by reason of the
adjustment required by such event over and above the Common Stock issuable upon
such conversion before giving effect to such adjustment and (2) fractionalizing
any share of Common Stock into which Series D Preferred is convertible and/or
paying to such holder cash in lieu of such fractional interest pursuant to
subparagraph (D) of this paragraph (vii).

                                       24



                                    (J) There shall be no adjustment of the
Conversion Price in case of the issuance of any shares of capital stock of the
Corporation in a reorganization, acquisition or other similar transaction except
as specifically set forth in this paragraph (vii).

                                    (K) The Corporation will at all times
reserve and keep available, free from preemptive rights, out of its authorized
but unissued Common Stock, for the purpose of effecting conversion of the Series
D Preferred, the full number of shares of Common Stock deliverable upon the
conversion of all outstanding Series D Preferred not theretofore converted. For
purposes of this subparagraph (K), the number of shares of Common Stock
deliverable upon the conversion of all outstanding shares of Series D Preferred
shall be computed as if at the time of computation all such outstanding shares
were held by a single holder.

                                    (L) The Corporation will pay any and all
documentary stamp or similar issue or transfer taxes payable in respect of the
issue or delivery of Common Stock or other securities or property on conversion
of the Series D Preferred pursuant hereto; provided, however, that the
Corporation shall not be required to pay any tax that may be payable in respect
of any transfer involved in the issue or delivery of Common Stock or other
securities or property in a name other than that of the holder of the Series D
Preferred to be converted, and no such issue or delivery shall be made unless
and until the person requesting such issue or delivery has paid to the
Corporation the amount of any such tax or has established, to the reasonable
satisfaction of the Corporation, that such tax has been paid.

                                    In addition to the foregoing adjustments,
the Corporation shall be entitled to make such reductions in the Conversion
Price, in addition to those required herein, as it in its discretion considers
to be advisable in order that any share dividends, subdivisions of shares,
reclassification or combination of shares, dividend of rights, options, warrants
to purchase shares or securities, or a dividend of other assets (other than cash
dividends) will not be taxable or, if that is not possible, to diminish any
income taxes that are otherwise payable because of such event.

                                    (M) Definitions. Unless the context
otherwise clearly indicates, terms defined in any subdivision of this paragraph
(vii) shall have the same meanings wherever used in this paragraph (vii).

                  (d) Series E Cumulative Convertible Preferred Stock.

                      (1) Designation and Number. A series of the preferred
stock, designated the "Series E Cumulative Convertible Preferred Stock" (the
"Series E Preferred"), is hereby established. The number of shares of the Series
E Preferred shall be 3,425,217.

                      (2) Relative Seniority. In respect of rights to receive
dividends until the Cross Over Date (as defined below) and to participate in
distributions or payments in the event of any liquidation, dissolution or
winding up of the corporation, the Series E Preferred shall rank pari passu with
the Series B Preferred and the Series D Preferred and any other capital stock of
the corporation designated as ranking pari passu with the Series B Preferred,
the Series D Preferred or the Series E Preferred, as to dividends or payments in
the event of any liquidation, dissolution or winding up of the corporation
(collectively, "Series E Parity Stock"), and senior to the common stock and any
other class or series of capital stock of the corporation designated as ranking
junior to the Series E Preferred or any Series E Parity Stock (collectively,
"Junior Stock").

                                       25



                           (3) Dividends.

                                    (A) Until the Cross Over Date, the holders
of the then outstanding Series E Preferred shall be entitled to receive, out of
any funds legally available therefor, cumulative preferential cash dividends at
the rate of 8% of the Liquidation Preference of the Series E Preferred
(equivalent to $1.3288 per share) per annum, payable quarterly in cash in
arrears on the last day, or the next succeeding Business Day, of January, April,
July and October in each year, beginning July 31, 2003 (each such day being
hereinafter called a "Series E Dividend Payment Date" and each period beginning
on the day succeeding a Series E Dividend Payment Date and ending on the next
following Series E Dividend Payment Date being hereinafter called a "Series E
Dividend Period"), to shareholders of record at the close of business on such
date as shall be fixed by the Board of Directors at the time of declaration of
the dividend (the "Series E Dividend Record Date"), which shall be not less than
10 nor more than 30 days preceding the Series E Dividend Payment Date. The
amount of any dividend payable for the initial Series E Dividend Period and for
any other partial Series E Dividend Period shall be computed on the basis of a
360-day year consisting of twelve 30-day months. Dividends on the shares of
Series E Preferred shall accrue and be cumulative from and including the date of
original issue thereof (the "Issue Date"), whether or not (i) the corporation
has earnings, (ii) dividends on such shares are declared or (iii) on any Series
E Dividend Payment Date there shall be funds legally available for the payment
of such dividends. When dividends are not paid in full upon the shares of Series
E Preferred and the shares of Series E Parity Stock (or a sum sufficient for
such full payment is not set apart therefor), all dividends declared upon shares
of Series E Preferred or any other Series E Parity Stock shall be declared pro
rata among all classes or series of Series E Parity Stock so that the amount of
dividends declared per share on the Series E Preferred and such other Series E
Parity Stock shall in all cases bear to each other the same ratio that accrued
dividends per share on the shares of Series E Preferred and such other Series E
Parity Stock bear to each other. "Business Day" shall mean any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions in New York City, New York are authorized or required by law,
regulation or executive order to close. Notwithstanding any provision of this
paragraph (3) to the contrary, from and after the Cross Over Date the holders of
the then outstanding Series E Preferred will be entitled to receive dividends in
such amount and at such time as dividends are paid to holders of common stock,
without preference, calculated on an as converted basis. Such dividends shall be
paid quarterly in cash in arrears. Dividends on the Series E Preferred will
cumulate to the extent not declared and paid in full whether or not (i) there
exists funds legally available for the payment of such dividends or (ii) such
dividends have been authorized.

                                    (B) Prior to the Cross Over Date, unless
full cumulative dividends on the Series E Preferred have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment on the Series E Preferred for all past
Series E Dividend Periods and the then current Series E Dividend Period, no
dividends (other than in Junior Stock) shall be declared or paid or set aside
for payment or other distribution or shall be declared or made upon any Junior
Stock, nor shall any Junior Stock or any Series E Parity Stock be redeemed,
purchased or otherwise acquired for any consideration (or any moneys be paid to
or made available for a sinking fund for the redemption of any shares of Junior
Stock) or Series E Parity Stock by the corporation (except by conversion into or
exchange for other Junior Stock or Parity Stock).

                                    (C) Any dividend payment made on shares of
the Series E Preferred shall first be credited against the earliest accrued but
unpaid dividend due with respect to such shares.

                                    The amount of any dividends accrued on any
shares of Series E Preferred at any Series E Dividend Payment Date shall be the
amount of any unpaid dividends accumulated thereon, to and including such Series
E Dividend Payment Date, whether or not earned or declared, and the amount of
dividends accrued on any shares of Series E Preferred at any date other than a
Series E

                                       26



Dividend Payment Date shall be equal to the sum of the amount of any unpaid
dividends accumulated thereon, to and including the last preceding Series E
Dividend Payment Date, whether or not earned or declared, plus an amount
calculated on the basis of the annual dividend rate for the period after such
last preceding Series E Dividend Payment Date to and including the date as of
which the calculation is made, based on a 360-day year of twelve 30-day months.

                                    Accrued but unpaid dividends on the Series E
Preferred will not bear interest. Holders of the Series E Preferred will not be
entitled to any dividends in excess of full cumulative dividends as described
above.

                                    (D) No dividends on shares of Series E
Preferred shall be declared by the Board of Directors of the corporation or paid
or set apart for payment by the corporation at such time as the terms and
provisions of any agreement of the corporation, including any agreement relating
to its indebtedness, prohibits such declaration, payment or setting apart for
payment or provides that such declaration, payment or setting apart for payment
would constitute a breach thereof or a default thereunder, or if such
declaration or payment shall be restricted or prohibited by law.

                                    (E) Except as provided in these Articles,
the Series E Preferred shall not be entitled to participate in the earnings or
assets of the corporation.

                                    (F) For purposes of this paragraph (d) the
term "Cross Over Date" means the date on which the holders of the Series E
Preferred would have received, in respect of such Series E Preferred, dividends
in an annualized amount equal to or greater than the Threshold Amount for a
period of four (4) consecutive calendar quarters, had such holders received
dividends equivalent to the dividends paid to holders of common stock,
calculated on an as converted basis, for such four (4) consecutive calendar
quarter period. For purposes of this paragraph (d) the term "Threshold Amount"
means the amount of the annual dividends earned on the Series E Preferred Stock
pursuant to this paragraph (3).

                           (4) Liquidation Rights.

                                    (A) Upon the voluntary or involuntary
dissolution, liquidation or winding up of the corporation, the holders of shares
of the Series E Preferred then outstanding shall be entitled to receive and to
be paid out of the assets of the corporation legally available for distribution
to its shareholders on parity with the Parity Stock, before any distribution
shall be made to the holders of any Junior Stock, a liquidation preference of
$16.61 per share, plus dividends thereon accrued and unpaid for any period prior
to the Cross Over Date to the date of payment (the "Liquidation Preference").

                                    (B) After the payment to the holders of the
shares of the Series E Preferred of the full Liquidation Preference, the holders
of the Series E Preferred as such shall have no right or claim to any of the
remaining assets of the corporation.

                                    (C) If, upon any voluntary or involuntary
dissolution, liquidation, or winding up of the corporation, the Liquidation
Preference and any amounts payable as a liquidation preference to other shares
of Series E Parity Stock are not paid in full, the holders of the shares of the
Series E Preferred and of such other shares of Series E Parity Stock will share
ratably in any such distribution of assets of the corporation in proportion to
the full respective liquidation preferences to which they are entitled.

                                    (D) Neither the sale, lease, transfer or
conveyance of all or substantially all the assets or business of the
corporation, nor the merger or consolidation of the

                                       27



corporation into or with any other corporation or the merger or consolidation of
any other corporation into or with the corporation, shall be deemed to be a
dissolution, liquidation or winding up, voluntary or involuntary, for the
purposes of this paragraph (4).

                           (5) Voting Rights.

                                    (A) Except as otherwise provided in this
paragraph (5), the holders of the Series E Preferred shall be entitled to vote
on an as converted basis as a single class in combination with the holders of
common stock at any meeting of the shareholders for the election of directors or
for any other purpose on which the holders of common stock are entitled to vote
or to participate in any action taken by the holders of common stock. The
holders of the Series E Preferred also shall be entitled to vote as a class on
any matter that the Maryland General Corporation Law requires the Series E
Preferred to vote on as a separate class. The holders of Series E Preferred
shall be entitled to receive notice of any meeting of the holders of common
stock.

                                    (B) So long as any shares of Series E
Preferred remain outstanding, the corporation shall not, without the affirmative
vote of the holders of at least a majority of the shares of the Series E
Preferred then outstanding, authorize or create, or increase the authorized or
issued amount of, the Series E Preferred (other than in connection with a pro
rata distribution of Series E Preferred to the holders thereof) or any class or
series of capital stock ranking prior to the Series E Preferred with respect to
the distribution of assets upon liquidation, dissolution or winding up of the
corporation or reclassify any authorized capital stock of the corporation into
any such shares, or create, authorize or issue any obligation or security
convertible into or evidencing the right to purchase any such shares.

                           (6) Conversion of Series E Preferred.

                                    (A) Subject to and upon compliance with the
provisions of this paragraph (6), a holder of shares of Series E Preferred shall
have the right (the "Conversion Right"), at such holder's option, at any time
and from time to time, to convert each share of Series E Preferred into, subject
to subparagraphs (D), (E) and (F) of this paragraph (6), one share of fully paid
and nonassessable common stock of the corporation by surrendering the
certificate evidencing such shares to be converted, in the manner provided in
subparagraph (B) of this paragraph (6).

                                    (B) In order to exercise the Conversion
Right, the holder of each share of Series E Preferred to be converted shall
surrender the certificate evidencing such share, duly endorsed or assigned to
the corporation or in blank, at the office of the corporation's transfer agent,
accompanied by written notice to the corporation that the holder thereof elects
to convert such share of Series E Preferred. Unless the certificate or
certificates for shares of common stock issuable on conversion are to be
registered in the same name as the name in which such certificate for Series E
Preferred is registered, each certificate surrendered for conversion shall be
accompanied by instruments of transfer, in form satisfactory to the corporation,
duly executed by the holder or such holder's duly authorized agent and an amount
sufficient to pay any transfer or similar tax (or evidence reasonably
satisfactory to the corporation demonstrating that such taxes have been paid).

                                    Holders of Series E Preferred at the close
of business on a Series E Dividend Record Date shall be entitled to receive the
dividend payable on the corresponding Series E Dividend Payment Date
notwithstanding the conversion of the Series E Preferred following such Series E
Dividend Record Date and prior to such Series E Dividend Payment Date. However,
shares of Series E Preferred surrendered for conversion during the period
beginning with the close of business on any Series E Dividend Record Date and
ending with the opening of business on the corresponding Series E Dividend
Payment Date must be accompanied by payment of an amount equal to the dividend
payable on such

                                       28



shares on such Series E Dividend Payment Date. The corporation shall make
further payment or allowance for, and a converting holder shall be entitled to,
accrued but unpaid dividends in arrears (excluding the then current quarter) on
converted shares and for dividends on the common stock issued upon such
conversion. A holder of shares of Series E Preferred on a Series E Dividend
Record Date who (or whose transferee) surrenders any such shares for conversion
into common stock after the opening of business on the corresponding Series E
Dividend Payment Date will receive the dividend payable by the corporation on
such Series E Preferred on such date, and the converting holder need not include
payment of the amount of such dividend upon such surrender.

                                    As promptly as practicable after the
surrender of certificates for Series E Preferred as aforesaid, the corporation
shall issue and shall deliver at such office to such holder, or on his written
order, a certificate or certificates for the number of whole shares of common
stock issuable upon the conversion of such Series E Preferred in accordance with
the provisions of this paragraph (6), and any fractional interest in respect of
common stock arising upon such conversion shall be settled as provided in
subparagraph (C) of this paragraph (6). Each conversion shall be deemed to have
been effected immediately prior to the close of business on the date on which
the certificates for Series E Preferred shall have been surrendered and such
notice (and if applicable, payment of an amount equal to the dividend payable on
such shares) received by the corporation as aforesaid, and the person or persons
in whose name or names any certificate or certificates for common stock shall be
issuable upon such conversion shall be deemed to have become the holder or
holders of record of the shares represented thereby at such time on such date,
unless the share transfer books of the corporation shall be closed on that date,
in which event such person or persons shall be deemed to have become such holder
or holders of record at the opening of business on the next succeeding day on
which such share transfer books are open.

                                    (C) No fractional shares or scrip
representing fractions of common stock shall be issued upon conversion of the
Series E Preferred. In lieu of issuing a fractional interest in common stock
that would otherwise be deliverable upon the conversion of a share of Series E
Preferred, the corporation shall pay to the holder of such share an amount in
cash equal to such fraction multiplied by the Current Market Price of the common
stock on the Trading Day immediately preceding the date of conversion. If more
than one share of Series E Preferred shall be surrendered for conversion at one
time by the same holder, the number of full shares of common stock issuable upon
conversion thereof shall be computed on the basis of the aggregate number of
shares of Series E Preferred so surrendered. For purposes of this paragraph (C)
"Current Market Price" of the common stock shall mean the last reported sale
price on such day or, if no sale takes place on such day, the average of the
reported closing bid and asked prices on such day, in either case as reported on
the New York Stock Exchange ("NYSE") or, if such security is not listed or
admitted for trading on the NYSE, on the principal national securities exchange
on which such security is listed or admitted for trading or, if not listed or
admitted for trading on any national securities exchange, on the NASDAQ National
Market or, if such security is not quoted on the NASDAQ National Market, the
average of the closing bid and asked prices on such day in the over-the-counter
market as reported by NASDAQ or, if bid and asked prices for such security on
such day shall not have been reported through NASDAQ, the average of the bid and
asked prices on such day as furnished by any NASD member firm regularly making a
market in such security and selected for such purpose by the Board of Directors.
For purposes of this paragraph (C) "Trading Day" shall mean any day on which the
common stock is traded on the NYSE, or if such security is not listed or
admitted for trading on the NYSE, on the principal national securities exchange
on which such security is listed or admitted for trading, or if not listed or
admitted for trading on any national securities exchange, on the NASDAQ National
Market or, if such security is not quoted on the NASDAQ National Market, in the
applicable securities market in which the security is traded.

                                    (D) If after the Issue Date the corporation
shall change the Series E Preferred or the common stock into the same or a
different number of shares of any class or classes of

                                       29



capital stock, whether by capital reorganization, reclassification or otherwise,
then and in each event each holder of the Series E Preferred shall have the
right to convert such shares of Series E Preferred into such kind and amount of
shares of capital stock as such holder would have received if the holder had
converted the Series E Preferred into common stock immediately prior to such
reorganization, reclassification or other change.

                                    (E) If after the Issue Date the corporation
shall be a party to any transaction including without limitation a merger,
consolidation, statutory share exchange, self tender offer for all or
substantially all of the outstanding common stock, sale of all or substantially
all of the corporation's assets, recapitalization or reclassification of capital
stock, other than a reorganization or reclassification set forth in subparagraph
(D) of this paragraph (6) (each of the foregoing being referred to herein as a
"Transaction"), in each case upon consummation of which common stock shall be
converted into the right to receive shares, stock, securities or other property
(including cash) or any combination thereof ("Transaction Consideration"), each
share of Series E Preferred shall be convertible into the kind and amount of
Transaction Consideration payable upon the consummation of such Transaction with
respect to that number of shares of common stock into which one share of Series
E Preferred was convertible immediately prior to such Transaction. The
corporation shall not be a party to any Transaction unless the terms of such
Transaction are consistent with this subparagraph (E). The provisions of this
subparagraph (E) shall similarly apply to successive Transactions.

                                    (F) If after the Issue Date the corporation
shall make or issue, or fix a record date for the holders of common stock
entitled to receive, a dividend or other distribution payable in securities
issued by the corporation, then and in each event, provision shall be made so
that each holder of Series E Preferred shall be entitled to receive, upon
conversion of the Series E Preferred, in addition to shares of common stock
receivable thereupon, such number of such securities as such holder would have
received if the holder had converted the Series E Preferred immediately prior to
the date of such event and had continued to hold such securities until the
conversion date.

                                    (G) If after the Issue Date:

                                    (i) the corporation shall declare dividends
on the common stock, excluding cash dividends not exceeding in amount current or
accumulated funds from operations at the date of declaration, determined on the
basis of the corporation's most recent annual or quarterly report to
shareholders at the time of the declaration of such dividends;

                                    (ii) the corporation shall authorize the
granting to the holders of the common stock of rights, options or warrants to
subscribe for or purchase any shares of any class or any other rights, options
or warrants;

                                    (iii) there shall be any Transaction for
which approval of any shareholders of the corporation is required; or

                                    (iv) there shall occur the voluntary or
involuntary liquidation, dissolution or winding up of the corporation;

                                    then the corporation shall cause to be
mailed to the holders of the Series E Preferred at their addresses as shown on
the share records of the corporation, as promptly as possible, but at least 15
days prior to the earliest applicable date hereinafter specified, a notice
stating (i) the record date as of which the holders of common stock entitled to
receive such dividend or grant of rights, options or warrants are to be
determined, provided, however, that no such notification need be made in respect
of a record date for a dividend or grant of rights, options or warrants, or (ii)
the date on

                                       30



which such Transaction, liquidation, dissolution or winding up is expected to
become effective, and the date as of which it is expected that holders of common
stock of record shall be entitled to exchange their common stock for securities
or other property, if any, deliverable upon such Transaction, liquidation,
dissolution or winding up. Failure to give such notice or any defect therein
shall not affect the legality or validity of the proceedings described in this
paragraph (6).

                                    (H) The corporation will at all times
reserve and keep available, free from preemptive rights, out of its authorized
but unissued common stock, for the purpose of effecting conversion of the Series
E Preferred, the full number of shares of common stock deliverable upon the
conversion of all outstanding Series E Preferred not theretofore converted. For
purposes of this subparagraph (H), the number of shares of common stock
deliverable upon the conversion of all outstanding shares of Series E Preferred
shall be computed as if at the time of computation all such outstanding shares
were held by a single holder.

                                    (I) Definitions. Unless the context
otherwise clearly indicates, terms defined in any subdivision of this paragraph
(6) shall have the same meanings wherever used in this paragraph (6).

         Section 5.5 Issuance of Authorized Shares. The Board is hereby
empowered to authorize from time to time the issuance or sale of shares of its
stock of any class, whether now or hereafter authorized, or securities
convertible into shares of its stock of any class or classes, whether now or
hereafter authorized, for such consideration as may be deemed advisable by the
Board and without any action by the stockholders.

         Section 5.6 Classified or Reclassified Shares. Prior to issuance of
classified or reclassified shares of any class or series, the Board by
resolution shall: (a) designate that class or series to distinguish it from all
other classes and series of stock of the Corporation; (b) specify the number of
shares to be included in the class or series; (c) set or change, subject to the
provisions of Article VI and subject to the express terms of any class or series
of stock outstanding at the time, the preferences, conversion or other rights,
voting powers, restrictions, limitations as to dividends or other distributions,
qualifications and terms and conditions of redemption for each class or series;
and (d) cause the Corporation to file articles supplementary with the State
Department of Assessments and Taxation of Maryland ("SDAT"). Any of the terms of
any class or series of stock set or changed pursuant to clause (c) of this
Section 5.6 may be made dependent upon facts or events ascertainable outside
this Charter (including determinations by the Board or other facts or events
within the control of the Corporation) and may vary among holders thereof,
provided that the manner in which such facts, events or variations shall operate
upon the terms of such class or series of stock is clearly and expressly set
forth in the articles supplementary filed with the SDAT.

         Section 5.7 Charter and Bylaws. All persons who acquire stock in the
Corporation shall acquire the same subject to the provisions of this Charter and
the Bylaws.

         Section 5.8 Rights of Objecting Stockholders. Holders of shares shall
not be entitled to exercise any rights of an objecting stockholder provided for
under Title 3, Subtitle 2 of the Maryland General Corporation Law unless the
Board, upon the affirmative vote of a majority of the entire Board, shall
determine that such rights shall apply, with respect to all or any classes or
series of stock, to a particular transaction or all transactions occurring after
the date of such approval in connection with which holders of such shares would
otherwise be entitled to exercise such rights.

                                       31



                                   ARTICLE VI
         RESTRICTIONS ON OWNERSHIP AND TRANSFER TO PRESERVE TAX BENEFIT

         Section 6.1 Restrictions on Transfer; Exchange for Excess Stock.

                  (a) Definitions. The following terms shall have the following
meanings:

                  "Beneficial Ownership" shall mean ownership of Capital Stock
by a Person who would be treated as an owner of such shares of Capital Stock
either directly or indirectly through the application of Section 544 of the
Code, as modified by Section 856(h)(1)(B) of the Code. The terms "Beneficial
Owner," "Beneficially Owns" and "Beneficially Owned" shall have correlative
meanings.

                  "Beneficiary" shall mean a beneficiary of the Trust as
determined pursuant to Section 6.2(e).

                  "Capital Stock" shall mean stock that is Common Stock, Excess
Stock or Preferred Stock.

                  "Constructive Ownership" shall mean ownership of Capital Stock
by a Person who would be treated as an owner of such shares of Capital Stock
either directly or indirectly through the application of Section 318 of the
Code, as modified by Section 856(d)(5) of the Code. The terms "Constructive
Owner," "Constructively Owns" and "Constructively Owned" shall have correlative
meanings.

                  "Equity Stock" shall mean stock that is either Common Stock or
Preferred Stock.

                  "Excess Stock" shall mean stock that is exchanged for Equity
Stock pursuant to Section 6.1(c).

                  "Market Price" on any date shall mean the average of the
Closing Price for the five consecutive Trading Days ending on such date. The
"Closing Price" on any date shall mean the last sale price, regular way, or, in
case no such sale takes place on such day, the average of the closing bid and
asked prices, regular way, in either case as reported in the principal
consolidated transaction reporting system with respect to securities listed or
admitted to trading on the New York Stock Exchange or, if the Equity Stock is
not listed or admitted to trading on the New York Stock Exchange, as reported in
the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which the
Equity Stock is listed or admitted to trading or, if the Equity Stock is not
listed or admitted to trading on any national securities exchange, the last
quoted price, or if not so quoted, the average of the high bid and low asked
prices in the over-the-counter market, as reported by the National Association
of Securities Dealers, Inc. Automated Quotation System or, if such system is no
longer in use, the principal other automated quotations system that may then be
in use or, if the Equity Stock is not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional
market maker making a market in the Equity Stock selected by the Board. "Trading
Day" shall mean a day on which the principal national securities exchange on
which the Equity Stock is listed or admitted to trading is open for the
transaction of business or, if the Equity Stock is not listed or admitted to
trading on any national securities exchange, shall mean any day other than a
Saturday, a Sunday or a day on which banking institutions in the State of New
York are authorized or obligated by law or executive order to close.

                  "Ownership Limit" shall mean 9.9% of the value of the
outstanding Equity Stock of the Corporation.

                                       32



                  "Person" shall mean an individual, Corporation, partnership,
estate, trust (including a trust qualified under Section 401(a) or 501(c)(17) of
the Code), a portion of a trust permanently set aside for or to be used
exclusively for the purposes described in Section 642(c) of the Code,
association, private foundation within the meaning of Section 509(a) of the
Code, joint stock company or other entity.

                  "Purported Beneficial Transferee" shall mean, with respect to
any purported Transfer that results in Excess Stock, the purported beneficial
transferee for whom the Purported Record Transferee would have acquired shares
of Equity Stock if such Transfer had been valid under Section 6.1(b).

                  "Purported Record Transferee" shall mean, with respect to any
purported Transfer that results in Excess Stock, the record holder of the Equity
Stock if such Transfer had been valid under Section 6.1(b).

                  "Restriction Termination Date" shall mean the first day after
the date hereof on which the Board and the stockholders of the Corporation
determine that it is no longer in the best interests of the Corporation to
attempt to, or continue to, qualify as a REIT.

                  "Rights" shall mean the rights granted under the Operating
Partnership Properties, L.P. Partnership Agreement to the limited partners to
acquire Common Stock.

                  "Operating Partnership Properties, L.P. Partnership Agreement"
shall mean the agreement of limited partnership establishing Operating
Partnership Properties, L.P., a California limited partnership.

                  "Transfer" shall mean any sale, transfer, gift, hypothecation,
pledge, assignment, devise or other disposition of Capital Stock (including (a)
the granting of any option or entering into any agreement for the sale, transfer
or other disposition of Equity Stock or (b) the sale, transfer, assignment or
other disposition of any securities or rights convertible into or exchangeable
for Capital Stock), whether voluntary or involuntary, whether of record,
constructively or beneficially and whether by operation of law or otherwise.

                  "Trust" shall mean the trust created pursuant to Section
6.2(a).

                  "Trustee" shall mean the Corporation, acting as trustee for
the Trust, or any successor trustee appointed by the Corporation.

                  (b)      Restriction on Transfers.

                           (i)      Except as provided in Section 6.1(i), from
the date hereof and prior to the Restriction Termination Date, no Person shall
Beneficially Own or Constructively Own shares of the outstanding Equity Stock in
excess of the Ownership Limit.

                           (ii)     Except as provided in Section 6.1(i), from
the date hereof and prior to the Restriction Termination Date, any Transfer
that, if effective, would result in any Person Beneficially Owning or
Constructively Owning Equity Stock in excess of the Ownership Limit shall be
void ab initio as to the Transfer of that number of shares of Equity Stock which
would be otherwise Beneficially Owned or Constructively Owned by such Person in
excess of the Ownership Limit; and the intended transferee shall acquire no
rights in such excess shares of Equity Stock.

                           (iii)    Except as provided in Section 6.1(i), from
the date hereof and prior to the Restriction Termination Date, any Transfer
that, if effective, would result in the Equity Stock's being

                                       33



Beneficially Owned by fewer than 100 Persons (determined without reference to
any rules of attribution) shall be void ab initio as to the Transfer of that
number of shares which would be otherwise Beneficially Owned or Constructively
Owned by the transferee; and the intended transferee shall acquire no rights in
such excess shares of Equity Stock.

                           (iv)     From the date hereof and prior to the
Restriction Termination Date, any Transfer of shares of Equity Stock that, if
effective, would result in the Corporation's being "closely held" within the
meaning of Section 856(h) of the Code shall be void ab initio as to the Transfer
of that number of shares of Equity Stock which would cause the Corporation to be
"closely held" within the meaning of Section 856(h) of the Code; and the
intended transferee shall acquire no rights in such excess shares of Equity
Stock.

                  (c) Exchange for Excess Stock.

                           (i)      If, notwithstanding the other provisions
contained in this Article VI, at any time after the date hereof and prior to the
Restriction Termination Date, there is a purported Transfer or other change in
the capital structure of the Corporation such that any Person would either
Beneficially Own or Constructively Own Equity Stock in excess of the Ownership
Limit, then, except as otherwise provided in Section 6.1(i), such shares of
Equity Stock in excess of the Ownership Limit (rounded up to the nearest whole
share) shall be automatically exchanged for an equal number of shares of Excess
Stock. Such exchange shall be effective as of the close of business on the
business day prior to the date of the Transfer or change in capital structure.

                           (ii)     If, notwithstanding the other provisions
contained in this Article VI, at any time after the date hereof and prior to the
Restriction Termination Date, there is a purported Transfer or other change in
the capital structure of the Corporation which, if effective, would cause the
Corporation to become "closely held" within the meaning of Section 856(h) of the
Code, then the shares of Equity Stock being Transferred or which are otherwise
affected by the change in capital structure and which, in either case, would
cause the Corporation to be "closely held" within the meaning of Section 856(h)
of the Code (rounded up to the nearest whole share) shall be automatically
exchanged for an equal number of shares of Excess Stock. Such exchange shall be
effective as of the close of business on the business day prior to the date of
the Transfer or change in capital structure.

                  (d) Remedies for Breach. If the Board or its designees at any
time determines in good faith that a Transfer has taken place in violation of
Section 6.1(b) or that a Person intends to acquire or has attempted to acquire
Beneficial Ownership or Constructive Ownership of any shares of Equity Stock in
violation of Section 6.1(b), the Board or its designees shall take such action
as it or they deem advisable to refuse to give effect to or to prevent such
Transfer, including, but not limited to, refusing to give effect to such
Transfer on the books of the Corporation or instituting proceedings to enjoin
such Transfer; provided, however, that any Transfers or attempted Transfers in
violation of Section 6.1(b) shall be void ab initio and automatically result in
the exchange described in Section 6.1(c), irrespective of any action (or
non-action) by the Board or its designees.

                  (e) Notice of Restricted Transfer. Any Person who acquires or
attempts to acquire shares of Equity Stock in violation of Section 6.1(b), or
any Person who is a transferee such that Excess Stock results under Section
6.1(c), shall immediately give written notice to the Corporation of such event
and shall provide to the Corporation such other information as the Corporation
may request in order to determine the effect, if any, of such Transfer or
attempted Transfer on the Corporation's status as a REIT.

                                       34



                  (f) Owners Required to Provide Information. From the date
hereof and prior to the Restriction Termination Date:

                           (i)      Every Beneficial Owner or Constructive Owner
of more than 5% (during any periods in which the number of such Persons exceeds
2000) or 1% (during any periods in which the number of such Persons is greater
than 200 but no more than 1999), or such lower percentages as required pursuant
to regulations under the Code, of the outstanding Equity Stock of the
Corporation shall, within 30 days after January 1 of each year, give written
notice to the Corporation stating the name and address of such Beneficial Owner
or Constructive Owner, the number of shares of Equity Stock Beneficially Owned
or Constructively Owned, and a description of how such shares are held. Each
such Beneficial Owner or Constructive Owner shall provide to the Corporation
such additional information as the Corporation may request in order to determine
the effect, if any, of such Beneficial Ownership on the Corporation's status as
a REIT and to ensure compliance with the Ownership Limit and existing holder
limit.

                           (ii)     Each Person who is a Beneficial Owner or
Constructive Owner of Equity Stock and each Person (including the stockholder of
record) who is holding Equity Stock for a Beneficial Owner or Constructive Owner
shall provide to the Corporation such information as the Corporation may request
in order to determine the Corporation's status as a REIT and to ensure
compliance with the Ownership Limited.

                  (g) Remedies Not Limited. Nothing contained in this Article VI
shall limit the authority of the Board to take such other action as it deems
necessary or advisable to protect the Corporation and the interests of its
stockholders by preservation of the Corporation's status as a REIT and to ensure
compliance with the Ownership Limit.

                  (h) Ambiguity. In the case of an ambiguity in the application
of any of the provisions of this Section 6.1, including any definition contained
in Section 6.1(a), the Board shall have the power to determine the application
of the provisions of this Section 6.1 with respect to any situation based on the
facts known to it.

                  (i) Exception. The Board, upon receipt of a ruling from the
Internal Revenue Service or an opinion of counsel in each case to the effect
that the restrictions contained in Section 6.1(b)(iii) and/or Section 6.1(b)(iv)
will not be violated, may exempt (i) a Person from the Ownership Limit if such
Person is not an individual for purposes of Section 542(a)(2) of the Code (as
modified by Section 856(h) of the Code) or (ii) is an underwriter which
participates in a public offering of the Equity Stock for a period of 90 days
following the purchase by such underwriter of the Equity Stock and the Board
obtains such representations and undertakings from such Person as are reasonably
necessary to ascertain that no individual's Beneficial Ownership of Equity Stock
will violate the Ownership Limit and such Person agrees that any violation or
attempted violation will result in such Equity Stock being exchanged for Excess
Stock in accordance with Section 6.1(c) and provided that any exemption of a
Person under clause (i) of this Section 6.1(i) shall not allow the Person to
exceed 13.0% of the value of the outstanding Equity Stock of the Corporation.

                  (j) Legend. Each certificate for Equity Stock shall bear the
following legend:

         "The shares of [____________] Stock represented by this certificate are
         subject to restrictions on transfer for the purpose of the
         Corporation's maintenance of its status as a real estate investment
         trust under the Internal Revenue Code of 1986, as amended (the "Code").
         No Person may (1) Beneficially Own or Constructively Own shares of
         Equity Stock in excess of 9.9% of the value of the outstanding Equity
         Stock of the Corporation; or (2) Beneficially Own Equity Stock that
         would

                                       35



         result in the Corporation's being "closely held" under Section 856(h)
         of the Code. Any Person who attempts to Beneficially Own or
         Constructively Own shares of Equity Stock in excess of the above
         limitations must immediately notify the Corporation. All capitalized
         terms in this legend have the meanings defined in this Charter, as the
         same may be further amended from time to time, a copy of which,
         including the restrictions on transfer, will be sent without charge to
         each stockholder who so requests. If the restrictions on transfer are
         violated, the shares of Equity Stock represented hereby will be
         automatically exchanged for shares of Excess Stock which will be held
         in trust by the Corporation."

         Section 6.2 Excess Stock.

                  (a) Ownership in Trust. Upon any purported Transfer that
results in Excess Stock pursuant to Section 6.1(c), such Excess Stock shall be
deemed to have been transferred to the Corporation, as Trustee of a Trust for
the exclusive benefit of such Beneficiary or Beneficiaries to whom an interest
in such Excess Stock may later be transferred pursuant to Section 6.2(e). Shares
of Excess Stock so held in trust shall be issued and outstanding stock of the
Corporation. The Purported Record Transferee shall have no rights in such Excess
Stock except the right to receive a price for its interest in the shares of
Equity Stock which were exchanged for Excess Stock. The Purported Beneficial
Transferee shall have no rights in such Excess Stock except as provided in
Section 6.2(e).

                  (b) Dividend Rights. Excess Stock shall not be entitled to any
dividends. Any dividend or distribution paid prior to the discovery by the
Corporation that the shares of Equity Stock have been exchanged for Excess Stock
shall be repaid to the Corporation upon demand, and any dividend or distribution
declared but unpaid shall be rescinded as void ab initio with respect to such
shares of Equity Stock.

                  (c) Rights upon Liquidation. In the event of any voluntary or
involuntary liquidation, dissolution, or winding up of, or any distribution of
the assets of, the Corporation, the shares of Excess Stock shall not be entitled
to share in any portion of the assets of the Corporation. At such time as (i)
the Corporation has received the necessary stockholder approval with respect to
a voluntary liquidation or dissolution of the Corporation, or (ii) the
Corporation has become the subject of an order of a court of competent
jurisdiction compelling an involuntary liquidation or dissolution of the
Corporation, such shares of Excess Stock held in Trust shall without further act
be extinguished and each Purported Beneficial Transferee whose acquisition of
Equity Stock resulted in the Excess Stock which has been extinguished pursuant
to this Section 6.2(c) shall without further act become a creditor of the
Corporation. The amount by which each such Purported Beneficial Transferee shall
become a creditor of the Corporation with respect to its now-extinguished
interest in the Trust (representing the number of shares of Excess Stock held by
the Trust attributable to a purported Transfer that resulted in the Excess
Stock) will be equal to the lesser of (i) that amount of the distributable
assets of the Corporation to which such Excess Stock would be entitled if such
Excess Stock were entitled to share ratably in the distributable assets of the
Corporation as shares of Common Stock, or (ii) as appropriate, either (A) the
price per share paid by such Purported Beneficial Transferee for the shares of
Equity Stock which were exchanged for Excess Stock, or (B) if the Purported
Beneficial Transferee did not give value for such shares of Equity Stock (having
received such through a gift, device or otherwise), a price per share equal to
the Market Price on the date of the purported Transfer that resulted in the
Excess Stock. Payment to the Purported Beneficial Transferee shall be without
interest and shall be due concurrently with the date of first distribution of
liquidation proceeds to the holders of Equity Stock. If the Corporation causes
such liquidation or dissolution to be revoked or otherwise rescinded any Excess
Stock previously automatically extinguished pursuant to this Section 6.2(c)
shall be automatically revived and any Purported Beneficial Transferees shall
without further act cease to be creditors of the Corporation as otherwise
provided above.

                                       36



                  (d) Voting Rights. The holders of shares of Excess Stock shall
not be entitled to vote on any matters (except as required by the general laws
of the State of Maryland).

                  (e) Restrictions on Transfer; Designation of Beneficiary.

                           (i)      Excess Stock shall not be transferable.  The
Corporation may designate a Beneficiary of an interest in the Trust
(representing the number of shares of Excess Stock held by the Trust
attributable to a purported Transfer that resulted in the Excess Stock), if the
shares of Excess Stock held in the Trust would not be Excess Stock in the hands
of such Beneficiary. The Purported Beneficial Transferee may receive a price for
its interest in the shares of Equity Stock which were exchanged for Excess Stock
provided that the Purported Beneficial Transferee does not receive a price for
such Excess Stock that exceeds (A) the price per share such Purported Beneficial
Transferee paid for the Equity Stock in the purported Transfer that resulted in
the Excess Stock, or (B) if the Purported Beneficial Transferee did not give
value for such shares of Excess Stock (through a gift, devise or otherwise), a
price per share equal to the Market Price on the date of the purported Transfer
that resulted in the Excess Stock. Upon such transfer of an interest in the
Trust, the corresponding shares of Excess Stock in the Trust shall be
automatically exchanged for an equal number of shares of Equity Stock, and such
shares of Equity Stock shall be transferred of record to the Beneficiary of the
interest in the Trust designated by the Corporation as described above if such
Equity Stock would not be Excess Stock in the hands of such Beneficiary.

                           (ii)     Notwithstanding the foregoing, if a
Purported Beneficial Transferee receives a price for its interest in the shares
of Equity Stock which were exchanged for Excess Stock that exceeds the amounts
allowable under Section 6.2(e)(i), such Purported Beneficial Transferee shall
pay, or cause to be paid, such excess to the Corporation, or, at the
Corporation's sole election, such excess shall be offset against any future
dividends or distributions payable to such Purported Beneficial Transferee.

                  (f) Purchase Right in Excess Stock. Shares of Excess Stock
shall be deemed to have been offered for sale to the Corporation, or its
designee at a price per share equal to the lesser of (i) the price per share in
the transaction that created such Excess Stock (or, in the case of devise or
gift, the Market Price at the time of such devise or gift) and (ii) the Market
Price on the date the Corporation, or its designee, accepts such offer. Subject
to the satisfaction of any applicable requirements of the general laws of the
State of Maryland, the Corporation shall have the right to accept such offer for
a period of ninety days after the later of (i) the date of the Transfer that
resulted in such Excess Stock and (ii) the date the Board determines in good
faith that a Transfer resulting in Excess Stock has occurred, if the Corporation
does not receive a notice of such Transfer pursuant to Section 6.1(e).

         Section 6.3 Further Authority. Nothing contained in this Article VI or
in any other provision of this Charter shall limit the authority of the Board to
take such other action as it in its sole discretion deems necessary or advisable
to protect the Corporation and the interests of the stockholders by maintaining
the Corporation's eligibility to be, and preserving the Corporation's status as,
a qualified REIT under the Code.

         Section 6.4 New York Stock Exchange. Nothing in this Article VI
precludes the settlement of transactions entered into through the facilities of
the New York Stock Exchange. As provided in this Article VI, under certain
circumstances, a Transfer of Equity Stock may result in the automatic exchange
of the Equity Stock being transferred for an equal number of shares of Excess
Stock.

                                       37



                                   ARTICLE VII
     PROVISIONS FOR DEFINING, LIMITING AND REGULATING CERTAIN POWERS OF THE
                CORPORATION AND OF THE STOCKHOLDERS AND DIRECTORS

         Section 7.1 Number and Term of Directors. The business and affairs of
the Corporation shall be managed by or under the direction of the Board. The
Board may take any action that, in its sole judgment and discretion, is
necessary or desirable to conduct the business of the Company. This Charter
shall be construed with a presumption in favor of the grant of power and
authority to the Board. Any construction of this Charter or determination made
in good faith by the Board concerning its powers and authority hereunder shall
be conclusive. The number of directors of the Corporation initially shall be
ten, which number may be increased or decreased pursuant to the Bylaws, but
shall never be less than the minimum number required by the Maryland General
Corporation Law. The names of the initial directors are as follows: Robert P.
Freeman, Jon A. Grove, James D. Klingbeil, Robert C. Larson, John P. McCann,
Thomas R. Oliver, Lynne B. Sagalyn, Mark J. Sandler, Robert W. Scharar and
Thomas W. Toomey. A director shall hold office until the next annual meeting of
stockholders and until his or her successor is elected and qualified, subject,
however, to prior death, resignation, retirement, disqualification or removal
from office. Subject to the rights of the holders of any series of Preferred
Stock then outstanding, newly created directorships resulting from any increase
in the authorized number of directors and any vacancies on the Board resulting
from death, resignation, retirement, disqualification, removal from office or
other cause shall be filled only by a majority vote of the remaining directors
then in office though less than a quorum. No decrease in the number of directors
constituting the Board shall cause the removal or shorten the term of any
incumbent director.

         Section 7.2 Removal of Directors. Subject to the rights of one or more
classes or series of Preferred Stock to elect or remove one or more directors,
any director or the entire Board may be removed from office at any time, with or
without cause, only at a meeting of the stockholders called for such purpose, by
the affirmative vote of the holders of a majority of the outstanding shares
entitled to vote, voting as a class, in the election of directors. The notice of
such meeting shall indicate that the purpose or one of the purposes of such
meeting is to determine if a director should be removed.

         Section 7.3 Board Powers and Determinations. The Board shall,
consistent with applicable law, have power in its sole discretion to determine
whether and to what extent and at what times and places and under what
conditions and regulations the books, accounts and documents of the Corporation,
or any of them, will be open to the inspection of stockholders, except as
otherwise provided by statute or by the Bylaws, and, except as so provided, no
stockholder shall have any right to inspect any book, account or document of the
Corporation unless authorized so to do by resolution of the Board. The
determination as to any of the following matters, made in good faith by or
pursuant to the direction of the Board consistent with this Charter and in the
absence of actual receipt of an improper benefit in money, property or services
or active and deliberate dishonesty established by a court, shall be final and
conclusive and shall be binding upon the Corporation and every holder of shares
of its stock: the amount of the net income of the Corporation for any period and
the amount of assets at any time legally available for the payment of dividends,
redemption of its stock or the payment of other distributions on its stock; the
amount of paid-in surplus, net assets, other surplus, annual or other net
profit, net assets in excess of capital, undivided profits or excess of profits
over losses on sales of assets; the amount, purpose, time of creation, increase
or decrease, alteration or cancellation of any reserves or charges and the
propriety thereof (whether or not any obligation or liability for which such
reserves or charges shall have been created shall have been paid or discharged);
the fair value, or any sale, bid or asked price to be applied in determining the
fair value, of any asset owned or held by the Corporation; any matters relating
to the acquisition, holding and disposition of any assets by the Corporation;
and any other matter relating to the business and affairs of the Corporation.

                                       38



         Section 7.4 Limitation of Liability and Indemnification. To the fullest
extent permitted by Maryland statutory or decisional law, as the same may from
time to time be amended or interpreted, no director or officer of the
Corporation shall be personally liable to the Corporation, any subsidiary
thereof or any of its stockholders for money damages. The Corporation shall
indemnify (a) its directors and officers, whether serving the Corporation or, at
its request, any other entity, to the full extent required or permitted by the
general laws of the State of Maryland now or hereafter in force, including the
advancement of expenses under the procedures and to the full extent permitted by
law, and (b) other employees and agents, whether serving the Corporation or, at
its request, any other entity, to such extent as may be authorized by the Board
or the Bylaws and as permitted by law. The foregoing rights of indemnification
shall not be exclusive of any other rights to which those seeking
indemnification may be entitled. The Board may take such action as is necessary
to carry out these indemnification provisions and is expressly empowered to
adopt, approve and amend from time to time such Bylaws, resolutions or contracts
implementing such provisions or such further indemnification arrangements as may
be permitted by law. No amendment of this Charter or repeal of any of its
provisions shall limit or eliminate the foregoing limitation of liability or
right to indemnification provided hereunder with respect to acts or omissions
occurring prior to such amendment or repeal.

                                  ARTICLE VIII
                                   AMENDMENTS

         Section 8.1 Bylaws. The Board shall have the exclusive power to adopt,
amend or repeal the Bylaws for the Corporation in accordance with the terms of
the Bylaws.

         Section 8.2 Charter. The Corporation reserves the right from time to
time to make any amendment now or hereafter authorized by law, including any
amendment altering the terms or contract rights, as expressly set forth in this
Charter, of any shares of outstanding stock. All rights and powers conferred by
this Charter on stockholders, directors and officers of the Corporation are
granted subject to this reservation. This Charter may be amended (a) by a
majority of the entire Board, without any action by the stockholders, to the
extent permitted by Maryland law, (i) to change the name of the Corporation,
(ii) to change the name or other designation or the par value of any class or
series of stock of the Corporation and the aggregate par value of the stock of
the Corporation or (iii) as contemplated by Section 5.1 of this Charter or (b)
by the affirmative vote of the holders of a majority of the shares of stock then
outstanding and entitled to vote thereon.

         Section 8.3 Provisions in Conflict with Law or Regulations.

                  (a) The provisions of this Charter are severable, and if the
Board determines that any one or more of such provisions are in conflict with
the Corporation's desire to maintain its status as a real estate investment
trust under the Code, or other applicable federal or state laws, the conflicting
provisions shall be deemed never to have constituted a part of this Charter,
even without any amendment of this Charter pursuant to Section 8.2 hereof;
provided, however, that such determination by the Board shall not affect or
impair any of the remaining provisions of this Charter or render invalid or
improper any action taken or omitted prior to such determination. No Director
shall be liable for making or failing to make such a determination.

                  (b) If any provision of this Charter or any application of
such provision is held invalid or unenforceable by any federal or state court
having jurisdiction, such holding shall not in any manner affect or render
invalid or unenforceable such provision in any other jurisdiction, and the
validity of the remaining provisions of this Charter shall not be affected.
Other applications of such provision shall be affected only to the extent
necessary to comply with the determination of such court.

                                       39

EX-2.02

                                                                    Exhibit 2.02
                               ARTICLES OF MERGER

                       UNITED DOMINION REALTY TRUST, INC.,
                             A VIRGINIA CORPORATION
                                       AND
                              UDRT MARYLAND, INC.,
                             A MARYLAND CORPORATION

         The undersigned corporations, pursuant to Title 13.1, Chapter 9,
Article 12 of the Code of Virginia, hereby execute the following articles of
merger and set forth:

                                       ONE

         United Dominion Realty Trust, Inc. ("UDRT Virginia") shall be merged
into UDRT Maryland, Inc. ("UDRT Maryland") pursuant to the Agreement and Plan of
Merger attached hereto as Exhibit A (the "Plan of Merger").

                                       TWO

         (1) The Plan of Merger was submitted to the shareholders of UDRT
Virginia by the board of directors of UDRT Virginia in accordance with the
provisions of Chapter 9 of Title 13.1 of the Code of Virginia, and:

                  (a)      The designation, number of outstanding shares, and
                           number of votes entitled to be cast by each voting
                           group entitled to vote separately on the Plan of
                           Merger were:



Designation       No. of Outstanding Shares     No. of Votes
                                          
Common Stock      108,827,959                   102,508,685


                  (b)      The total number of votes cast for and against the
                           Plan of Merger by each voting group entitled to vote
                           separately on the plan was:



 Voting Group      Total No. of Votes Cast    Total No. of Votes Cast
                   FOR the Plan of Merger     AGAINST the Plan of Merger
                                        
Common Stock            74,134,384                   3,209,386


                  (c)      And the number cast for the Plan of Merger by each
                           voting group was sufficient for approval by that
                           voting group.

         (2) The Plan of Merger was submitted to the sole stockholder of UDRT
Maryland by the board of directors of UDRT Maryland in accordance with the
provisions



of Chapter 9 of Title 13.1 of the Code of Virginia, and approved and adopted by
the written consent of the sole stockholder.

         The undersigned officers declare that the facts herein stated are true
as of June 11, 2003.

                                            United Dominion Realty Trust, Inc.

                                            By: /s/ Mary Ellen Norwood
                                                --------------------------------
                                                    Mary Ellen Norwood
                                                    Vice President and Secretary

                                            UDRT Maryland, Inc.

                                            By: /s/ Warren L. Troupe
                                                --------------------------------
                                                    Warren L. Troupe
                                                    President

                                       2



                                    EXHIBIT A

                          AGREEMENT AND PLAN OF MERGER

         This Agreement and Plan of Merger (this "Agreement"), dated as of June
11, 2003, is by and between United Dominion Realty Trust, Inc., a Virginia
corporation ("UDRT") and UDRT Maryland, Inc., a Maryland corporation and a
wholly owned subsidiary of UDRT ("UDRT Maryland").

                                   WITNESSETH:

         WHEREAS, UDRT is a corporation duly formed under the laws of the
Commonwealth of Virginia;

         WHEREAS, UDRT Maryland is a corporation duly formed under the laws of
the State of Maryland; and

         WHEREAS, the board of directors and shareholders of UDRT and the board
of directors and sole shareholder of UDRT Maryland each deems it desirable, upon
the terms and subject to the conditions of this Agreement, that UDRT be merged
with and into UDRT Maryland and that UDRT Maryland be the surviving entity.

         NOW, THEREFORE, the parties agree as follows:

                                   ARTICLE I

                                   THE MERGER

         Section 1.01. THE MERGER. Upon the terms and subject to the conditions
set forth in this Agreement and in accordance with the laws of the Commonwealth
of Virginia and the State of Maryland, UDRT shall be merged with and into UDRT
Maryland (the "Merger"). As a result of the Merger, the identity and separate
existence of UDRT shall cease and UDRT Maryland, Inc. shall continue as the
surviving entity of the Merger (sometimes referred to herein as the "Surviving
Corporation"). In connection with the Merger, the name of UDRT Maryland, Inc.
will be changed to United Dominion Realty Trust, Inc.

         Section 1.02. EFFECTIVE TIME. The parties shall cause the Merger to be
consummated by filing articles of merger with the State Corporation Commission
of the Commonwealth of Virginia and the State Department of Assessments and
Taxation of the State of Maryland, as required by, and executed in accordance
with the relevant laws of the Commonwealth of Virginia and the State of
Maryland, all to be effective as of the time of acceptance of the Articles of
Merger by the State Corporation Commission of the Commonwealth of Virginia and
the State Department of Assessments and Taxation of the State of Maryland (the
"Effective Time").

         Section 1.03. EFFECT OF THE MERGER. At the Effective Time, the effect
of the Merger shall be as provided under the laws of the Commonwealth of
Virginia and the State of Maryland. Without limiting the generality of the
foregoing, and subject thereto, at the Effective Time, all the rights,
privileges, powers and franchises of UDRT, shall vest in the Surviving
Corporation,

                                       3



and all debts, liabilities and duties of UDRT shall become the debts,
liabilities and duties of the Surviving Corporation.

         Section 1.04. SUBSEQUENT ACTIONS. If, at any time after the Effective
Time, the Surviving Corporation shall consider or be advised that any deeds,
bills of sale, assignments, assurances or any other actions or things are
necessary or desirable to continue in, vest, perfect or confirm of record or
otherwise in the Surviving Corporation its right, title or interest in, to or
under any of the rights, properties, privileges, franchises or assets of UDRT
acquired or to be acquired by the Surviving Corporation as a result of, or in
connection with, the Merger or otherwise to carry out this Agreement, the proper
officers of the Surviving Corporation shall be and hereby are directed and
authorized to execute and deliver, in the name and on behalf of UDRT, all such
deeds, bills of sale, assignments and assurances and to take and do, in the name
and on behalf of UDRT or otherwise, all such other actions and things as may be
necessary or desirable to vest, perfect or confirm any and all right, title and
interest in, to and under such rights, properties, privileges, franchises or
assets in the Surviving Corporation or otherwise to carry out this Agreement.

                                   ARTICLE II

                              CONVERSION OF SHARES

         At the Effective Time, by virtue of the Merger and without any action
on the part of UDRT or UDRT Maryland, each share of the outstanding capital
stock of UDRT shall be exchanged for one share of the outstanding capital stock
of UDRT Maryland.

                                  ARTICLE III

                                  GOVERNING LAW

         This Agreement shall be construed in accordance with and governed by
the laws of the State of Maryland, without giving effect to principles of
conflicts of laws.

     [Remainder of page intentionally left blank, signature page to follow.]

                                       4



         IN WITNESS WHEREOF, UDRT and UDRT Maryland have each caused this
Agreement to be duly executed under seal, all as of the date first above
written.

                  UNITED DOMINION REALTY TRUST, INC., a Virginia corporation

                  By: /s/ Mary Ellen Norwood
                      ------------------------------------------------
                          Mary Ellen Norwood
                          Vice President and Secretary

                  UDRT MARYLAND, INC., a Maryland corporation

                  By: /s/ Warren L. Troupe
                      ------------------------------------------------
                          Warren L. Troupe
                          President

                                       5

EX-3.02

                                                                    Exhibit 3.02

                                     BYLAWS

                                       OF

                       UNITED DOMINION REALTY TRUST, INC.

                             A MARYLAND CORPORATION



                                TABLE OF CONTENTS
                                                                                                      
ARTICLE I           OFFICES...............................................................................   1

    Section 1.1         Principal Office in Maryland and Resident Agent...................................   1

    Section 1.2         Other Offices.....................................................................   1

ARTICLE II          STOCKHOLDERS' MEETINGS................................................................   1

    Section 2.1         Place of Meetings.................................................................   1

    Section 2.2         Annual Meetings...................................................................   2

    Section 2.3         Special Meetings..................................................................   2

    Section 2.4         Notice of Meetings................................................................   2

    Section 2.5         Record Date.......................................................................   3

    Section 2.6         Quorum and Voting.................................................................   4

    Section 2.7         Right to Vote; Proxies............................................................   4

    Section 2.8         Voting of Shares by Certain Holders...............................................   5

    Section 2.9         Inspectors........................................................................   6

    Section 2.10        Action Without Meetings...........................................................   6

    Section 2.11        Voting by Ballot..................................................................   6

ARTICLE III         DIRECTORS.............................................................................   7

    Section 3.1         Number and Term of Office.........................................................   7

    Section 3.2         Powers............................................................................   7

    Section 3.3         Vacancies.........................................................................   7

    Section 3.4         Resignations and Removals.........................................................   7

    Section 3.5         Meetings..........................................................................   8

    Section 3.6         Quorum and Voting.................................................................   8

    Section 3.7         Action Without Meeting............................................................   9

    Section 3.8         Fees and Compensation.............................................................   9

    Section 3.9         Presumption of Assent.............................................................   9

    Section 3.10        Committees........................................................................   9

ARTICLE IV          OFFICERS..............................................................................  10

    Section 4.1         Officers Designated...............................................................  10

    Section 4.2         Tenure and Duties of Officers.....................................................  11



                                     - ii -



                                                                                                      
ARTICLE V           EXECUTION OF CORPORATE INSTRUMENTS AND VOTING OF SECURITIES OWNED BY THE CORPORATION..  12

    Section 5.1         Execution of Corporate Instruments................................................  12

    Section 5.2         Voting of Securities Owned by Corporation.........................................  12

ARTICLE VI          SHARES OF STOCK.......................................................................  12

    Section 6.1         Certificates......................................................................  12

    Section 6.2         Transfers.........................................................................  13

    Section 6.3         Replacement Certificate...........................................................  13

    Section 6.4         Stock Ledger......................................................................  14

    Section 6.5         Issuance of Units.................................................................  14

    Section 6.6         Fractional Share Interests or Scrip...............................................  14

    Section 6.7         Dividends.........................................................................  14

ARTICLE VII         EXEMPTION FROM CONTROL SHARE ACQUISITION ACT..........................................  15

ARTICLE VIII        OTHER SECURITIES OF THE CORPORATION...................................................  15

ARTICLE IX          CORPORATE SEAL........................................................................  15

ARTICLE X           FISCAL YEAR...........................................................................  15

ARTICLE XI          INDEMNIFICATION.......................................................................  16

    Section 11.1        Right to Indemnification..........................................................  16

    Section 11.2        Provisions Nonexclusive...........................................................  16

    Section 11.3        Authority to Insure...............................................................  16

    Section 11.4        Survival of Rights................................................................  16

    Section 11.5        Subrogation.......................................................................  17

    Section 11.6        No Duplication of Payments........................................................  17



                                     - iii -



                                     BYLAWS

                                       OF

                       UNITED DOMINION REALTY TRUST, INC.

                                   ARTICLE I

                                     OFFICES

SECTION 1.1 PRINCIPAL OFFICE IN MARYLAND AND RESIDENT AGENT.

         The address of the principal office of the corporation in the State of
Maryland is 300 E. Lombard Street, Baltimore, Maryland 21202. The name and
address of the resident agent in the State of Maryland is The Corporation Trust
Incorporated, a Maryland corporation, 300 E. Lombard Street, Baltimore, Maryland
21202.

SECTION 1.2 OTHER OFFICES.

         The corporation may also have and maintain such other offices or places
of business, both within and outside the State of Maryland as the Board of
Directors may from time to time determine or the business of the corporation may
require.

                                   ARTICLE II

                             STOCKHOLDERS' MEETINGS

SECTION 2.1 PLACE OF MEETINGS.

         (a) Meetings of stockholders may be held at such place, either within
or outside the State of Maryland, as may be designated by or in the manner
provided in these Bylaws or, if not so designated, as determined by the Board of
Directors. The Board of Directors may, in its sole discretion, determine that
the meeting may not be held at any place, but may instead be held solely by
means of remote communication as authorized by paragraph (b) of this Section
2.1.

         (b) If authorized by the Board of Directors in its sole discretion, and
subject to such guidelines and procedures as the Board of Directors may adopt,
stockholders and proxyholders not physically present at a meeting of
stockholders may, by means of remote communication:

                  (i) Participate in a meeting of stockholders; and

                  (ii) Be deemed present in person and vote at a meeting of
stockholders whether such meeting is to be held at a designated place or solely
by means of remote communication, provided that the corporation (A) implements
reasonable measures to verify that each person deemed present and permitted to
vote at the meeting by means of remote communication is a stockholder or
proxyholder, (B) implements reasonable measures to provide

                                       1



such stockholders and proxyholders a reasonable opportunity to participate in
the meeting and to vote on matters submitted to the stockholders, and (C)
maintains a record of any vote or action by any stockholder or proxyholder at
the meeting by means of remote communication.

         (c) "Remote communication" means a conference telephone or similar
communications equipment provided that all persons participating in the meeting
can hear each other at the same time.

SECTION 2.2 ANNUAL MEETINGS.

         The annual meetings of the stockholders of the corporation, for the
purpose of election of directors and for such other business as may lawfully
come before it, shall be held on such date and at such time the Board of
Directors designates from time to time. Failure to hold an annual meeting does
not invalidate the corporation's existence or affect any otherwise valid
corporate act.

SECTION 2.3 SPECIAL MEETINGS.

         Special meetings of the stockholders of the corporation may be called,
for any purpose or purposes, by the Chairman of the Board of Directors or the
President or the Board of Directors at any time. Upon written request of any
stockholder or stockholders entitled to cast at least ten percent (10%) of all
the votes entitled to be cast at the meeting, if such request states the purpose
of the meeting and the matters proposed to be acted on at it, delivered in
person or sent by registered mail to the Chairman of the Board of Directors,
President or Secretary of the corporation, the Secretary shall inform the
stockholders who make the request of the reasonably estimated cost of preparing
and mailing a notice of the meeting and on payment of these costs to the
corporation, notify each stockholder entitled to notice of the meeting. The
Board of Directors has the sole power to fix the record date for determining
stockholders entitled to request a special meeting of the stockholders, the
record date for determining stockholders entitled to notice of and to vote at
the special meeting and the date, time and place of the special meeting.

SECTION 2.4 NOTICE OF MEETINGS.

         (a) Except as otherwise provided by law or in the Articles of
Incorporation, written notice of each meeting of stockholders, specifying the
place, if any, date and hour and, in the case of a special meeting or as
otherwise may be required by law, purpose or purposes of the meeting, and the
means of remote communication, if any, by which stockholders and proxyholders
may be deemed to be present in person and vote at such meeting, shall be given
by the Secretary of the Corporation not less than ten (10) nor more than ninety
(90) days before the date of the meeting to each stockholder entitled to vote
thereat, directed to his or her address as it appears upon the books of the
corporation. No business shall be transacted at a special meeting of
stockholders except as specifically designated in the notice.

         (b) When a meeting is adjourned to another time or place, notice need
not be given of the adjourned meeting if the time, place, if any, thereof, and
the means of remote communication, if any, by which stockholders and
proxyholders may be deemed to be present in person and vote at such adjourned
meeting, are announced at the meeting at which the

                                       2



adjournment is taken unless the adjournment is for more than one hundred twenty
(120) days after the original record date, or unless after the adjournment a new
record date is fixed for the adjourned meeting, in which event a notice of the
adjourned meeting shall be given to each stockholder of record entitled to vote
at the meeting.

         (c) Notice of the time, place and purpose of any meeting of
stockholders may be waived in writing, either before or after such meeting, and,
to the extent permitted by law, will be waived by any stockholder by his or her
attendance thereat, in person or by proxy. Any stockholder so waiving notice of
such meeting shall be bound by the proceedings of any such meeting in all
respects as if due notice thereof had been given.

         (d) Without limiting the manner by which notice otherwise may be given
effectively to stockholders, any notice to stockholders given by the corporation
under any provision of Maryland General Corporation Law, the Articles of
Incorporation or these Bylaws shall be effective when it is (i) personally
delivered to the stockholder, (ii) left at the stockholder's residence or usual
place of business, (iii) mailed to the stockholder at the stockholder's address
as it appears on the records of the corporation or (iv) if consented to by such
stockholder, transmitted to the stockholder by electronic mail to any electronic
mail address of the stockholder or by any other electronic means. Any such
consent shall be revocable by the stockholder by written notice to the
corporation. Any such consent shall be deemed revoked if (i) the corporation is
unable to deliver by electronic mail or other means two consecutive notices
given by the corporation in accordance with such consent, and (ii) such
inability becomes known to the Secretary or an assistant secretary of the
corporation or to the transfer agent or other person responsible for the giving
of notice; provided, however, the inadvertent failure to treat such inability as
a revocation shall not invalidate any meeting or other action. An affidavit of
the Secretary or an assistant secretary or of the transfer agent or other agent
of the corporation that the notice has been given by a form of electronic mail
or other means shall, in the absence of fraud, be prima facie evidence of the
facts stated therein. For purposes of these Bylaws, "electronic mail" or
"electronic means" means any form of communication, not directly involving the
physical transmission of paper, that creates a record that may be retained,
retrieved and reviewed by a recipient thereof, and that may be directly
reproduced in paper form by such a recipient through an automated process.

SECTION 2.5 RECORD DATE.

         For purposes of determining the stockholders entitled to notice of or
to vote at any meeting of stockholders or any adjournment thereof, or to receive
payment of any dividend or other distribution or allotment of any rights, or to
exercise any rights in respect of any change, conversion or exchange of stock or
for the purpose of any other lawful action, the Board of Directors may (a) fix,
in advance, a record date which shall not be more than ninety (90) days prior to
the date of any such meeting or the taking of such other actions; or (b) direct
that the stock transfer books be closed for a period not to exceed twenty (20)
days. A record date may not precede the date on which the record date is fixed.
In the case of a meeting of stockholders, the record date or the closing of the
transfer books shall be at least ten (10) days before the meeting. A
determination of stockholders of record entitled to notice of or to vote at a
meeting of stockholders shall apply to any adjournment of the meeting; provided,
however, that the Board of Directors may fix a new record date for the adjourned
meeting. Except where the Board of

                                      3



Directors fixes a new record date for any adjourned meeting, any stockholder who
was a stockholder on the original record date shall be entitled to receive
notice of and to vote at a meeting of stockholders or any adjournment thereof
and to receive a dividend or allotment of rights even though he or she has since
such date disposed of his or her shares, and no stockholder becoming a
stockholder after such date shall be entitled to receive notice of or to vote at
such meeting or any adjournment thereof or to receive such dividend or allotment
of rights.

         If the Board of Directors does not so fix a record date or close the
stock transfer books, then:

         (a) The record date for determining stockholders entitled to notice of
or to vote at a meeting of stockholders shall be the later of (i) at the close
or business on the day on which notice is mailed or (ii) at the close of
business on the thirtieth (30th) day next preceding the day on which the meeting
is held.

         (b) The record date for determining stockholders for any other purpose
shall be at the close of business on the day on which the Board of Directors
adopts the resolution relating thereto provided that the payment of a dividend
or allotment of rights may not be made more than sixty (60) days after the date
on which such resolution was adopted.

SECTION 2.6 QUORUM AND VOTING.

         (a) At all meetings of stockholders except where otherwise provided by
law, the Articles of Incorporation or these Bylaws, the presence, in person or
by proxy duly authorized, of the holders of a majority of all the votes entitled
to be cast at the meeting shall constitute a quorum for the transaction of
business. Shares, the voting of which at said meeting have been enjoined, or
which for any reason cannot be lawfully voted at such meeting, shall not be
counted to determine a quorum at said meeting. In the absence of a quorum, any
meeting of stockholders may be adjourned, from time to time, by vote of the
holders of a majority of the shares represented thereat, but no other business
shall be transacted at such meeting. At such adjourned meeting at which a quorum
is present or represented, any business may be transacted that might have been
transacted at the original meeting.

         (b) Except as otherwise provided by law, the Articles of Incorporation
or these Bylaws, a majority of all the votes cast at a meeting at which a quorum
is present is sufficient to approve any matter that properly comes before the
meeting, except that a plurality of all the votes cast at a meeting at which a
quorum is present is sufficient to elect a director.

         (c) Except as otherwise provided by law or the Articles of
Incorporation, where a separate vote by a class or classes is required, a
majority of the outstanding shares of such class or classes present in person or
represented by proxy shall constitute a quorum entitled to take action with
respect to that vote on that matter, and the affirmative vote of the majority of
shares of such class or classes present in person or represented by proxy at the
meeting shall be the act of such class.

SECTION 2.7 RIGHT TO VOTE; PROXIES.

                                       4



            Unless the Articles of Incorporation provide for a greater or lesser
number of votes per share or limit or deny voting rights, each outstanding share
of stock, regardless of class, is entitled to one vote on each matter submitted
to a vote at a meeting of stockholders. A stockholder may cast the votes
entitled to be cast by the shares of the corporation owned of record by him or
her, either in person or by proxy in any manner authorized by law, by the
stockholder or by his or her duly authorized attorney in fact. Such proxy shall
be filed with the Secretary before or at the time of the meeting. A stockholder
may authorize another person to act as proxy by transmitting, or authorizing the
transmission of, an authorization by telegram, cablegram, datagram, electronic
mail or any other electronic or telephonic means to the person authorized to act
as proxy or to any other person authorized to receive the proxy authorization on
behalf of the person authorized to act as proxy, including a proxy solicitation
firm or proxy support service organization. No proxy shall be valid after eleven
(11) months from the date of its execution, unless otherwise provided in the
proxy. A proxy is revocable by a stockholder at any time without condition or
qualification unless the proxy states that it is irrevocable and the proxy is
coupled with an interest. A proxy may be made irrevocable for so long as it is
coupled with an interest. The interest with which a proxy may be coupled
includes an interest in the stock to be voted under the proxy or another general
interest in the corporation or its assets or liabilities.

SECTION 2.8 VOTING OF SHARES BY CERTAIN HOLDERS.

         (a) Shares registered in the name of a corporation, partnership, trust
or other entity, if entitled to be voted, may be voted by the president or a
vice president, a general partner or trustee thereof, as the case may be, or a
proxy appointed by any of the foregoing individuals, unless some other person
who has been appointed to vote such shares pursuant to a bylaw or a resolution
of the governing body of such corporation or other entity or agreement of the
partners of a partnership presents a certified copy of such bylaw, resolution or
agreement, in which case such person may vote such shares. Any director or other
fiduciary may vote shares registered in his or her name as such fiduciary,
either in person or by proxy.

         (b) Shares registered in the name of a person adjudged incompetent may
be voted and all rights incident thereto may be exercised only by his or her
guardian, in person or by proxy. Shares registered in the name of a deceased
person may be voted and all rights incident thereto may be exercised only by his
or her executor or administrator, in person or by proxy. Shares registered in
the name of a minor may be voted and all rights incident thereto may be
exercised by his or her guardian, in person or by proxy, or in the absence of
such representation by his or her guardian, by the minor, in person or by proxy,
whether or not the corporation has notice, actual or constructive, of the
minority or the appointment of a guardian, and whether or not a guardian has in
fact been appointed.

         (c) Shares registered in the names of two or more persons shall be
voted or represented in accordance with the vote or consent of the majority of
the persons in whose names the shares stand. If only one such person is present
in person or by proxy, he or she may vote all the shares, and all the shares
standing in the names of such persons are represented for the purpose of
determining a quorum. This procedure also applies to the voting of shares by two
or more administrators, executors, trustees or other fiduciaries, unless the
instrument or order of court appointing them otherwise directs.

                                       5



         (d) Shares of the corporation directly or indirectly owned by it shall
not be voted at any meeting and shall not be counted in determining the total
number of outstanding shares entitled to be voted at any given time, unless they
are held by it in a fiduciary capacity, in which case they may be voted and
shall be counted in determining the total number of outstanding shares at any
given time.

         (e) The Board of Directors may adopt by resolution a procedure by which
a stockholder may certify in writing to the corporation that any shares
registered in the name of the stockholder are held for the account of a
specified person other than the stockholder. The resolution shall set forth: the
class of stockholders who may make the certification; the purpose for which the
certification may be made; the form of certification; the information to be
contained in it; if the certification is with respect to a record date or
closing of the stock transfer books, the time after the record date or closing
of the stock transfer books within which the certification must be received by
the corporation; and any other provisions with respect to the procedure which
the Board of Directors considers necessary or desirable. On receipt of such
certification, the person specified in the certification shall be regarded as,
for the purposes set forth in the certification, the stockholder of record of
the specified shares in place of the stockholder who makes the certification.

SECTION 2.9 INSPECTORS.

         At any meeting of stockholders, the chairman of the meeting may appoint
one or more persons as inspectors for such meeting. Such inspectors shall
ascertain and report the number of shares represented at the meeting based on
their determination of the validity and effect of proxies, count all votes,
report the results and perform such other acts as are proper to conduct the
election and voting with impartiality and fairness to all the stockholders. Each
report of an inspector or inspectors shall be in writing and signed by him or by
a majority of them if there is more than one inspector; the report of a majority
shall be the report of the inspectors. The report of the inspector or inspectors
on the number of shares represented at the meeting and the results of the voting
shall be prima facie evidence thereof.

SECTION 2.10 ACTION WITHOUT MEETINGS.

         Except as provided in the next sentence, any action required or
permitted to be taken at a meeting of stockholders may be taken without a
meeting if there is filed with the records of stockholders' meetings a unanimous
written consent which sets forth the action and is signed by each stockholder
entitled to vote on the matter. Unless the Articles of Incorporation require
otherwise, the holders of any class of stock other than common stock, entitled
to vote generally in the election of directors, may take action or consent to
any action by the written consent of stockholders entitled to cast not less than
the minimum number of votes that would be necessary to authorize or take the
action at a stockholders meeting if the corporation gives notice of the action
to each stockholder not later than ten (10) days after the effective time of the
action.

SECTION 2.11 VOTING BY BALLOT.

         If ordered by the presiding officer of any stockholder meeting, the
vote upon any election or question shall be by ballot.

                                       6



                                  ARTICLE III

                                    DIRECTORS

SECTION 3.1 NUMBER AND TERM OF OFFICE.

         The number of directors of the corporation shall not be less than one
(1) nor more than twelve (12) until changed by a Bylaw amending this Section 3.1
duly adopted by the Board of Directors. The exact number of directors shall be
fixed from time to time, within the limits specified in this Section 3.1, by the
Board of Directors. Subject to the foregoing provisions for changing the number
of directors, the number of directors of the corporation has been fixed at ten
(10).

         With the exception of the first Board of Directors, which shall be
elected by the incorporators, and except as provided in Section 3.3, the
directors shall be elected by a plurality vote of the shares represented in
person or by proxy, at the stockholders annual meeting in each year and entitled
to vote on the election of directors. Elected directors shall hold office until
the next annual meeting and until their successors are duly elected and
qualified. Directors need not be stockholders. A director may not stand for
re-election if he or she has attained age seventy (70) on or before the date of
the annual meeting at which directors are elected.

SECTION 3.2 POWERS.

         The powers of the corporation shall be exercised, its business
conducted and its property controlled by or under the direction of the Board of
Directors.

SECTION 3.3 VACANCIES.

         Vacancies and newly created directorships resulting from any increase
in the authorized number of directors may be filled only by a majority of the
directors then in office, although less than a quorum, or by a sole remaining
director, and each director so elected shall hold office for the unexpired
portion of the term of the director whose place is vacant and until his or her
successor is duly elected and qualified. A vacancy in the Board of Directors
shall be deemed to exist under this Section 3.3 in the case of the death,
removal or resignation of any director, or if the stockholders fail at any
meeting of stockholders at which directors are to be elected (including any
meeting referred to in Section 3.4 below) to elect the number of directors then
constituting the whole Board of Directors.

SECTION 3.4 RESIGNATIONS AND REMOVALS.

         (a) Any director may resign at any time by delivering his or her
resignation to the Secretary in writing or by electronic transmission, such
resignation to specify whether it will be effective at a particular time, upon
receipt by the Secretary or at the pleasure of the Board of Directors. If no
such specification is made it shall be deemed effective at the pleasure of the
Board of Directors. When one or more directors resigns from the Board of
Directors effective at a future date, only a majority of the remaining directors
then in office, even if such remaining directors do not constitute a quorum,
shall have the power to fill such vacancy or vacancies, the vote thereon to take
effect when such resignation or resignations become effective, and each

                                       7



director so chosen shall hold office for the unexpired portion of the term of
the director whose place is vacated and until his or her successor is duly
elected and qualified.

         (b) At a special meeting of stockholders called for the purpose in the
manner provided above, the Board of Directors or any individual director may be
removed from office with cause, by the affirmative vote of at least two-thirds
of all the votes entitled to be cast by the stockholders generally in the
election of directors.

SECTION 3.5 MEETINGS.

         (a) The annual meeting of the Board of Directors shall be held
immediately after the annual stockholders' meeting and at the place where such
meeting is held or at the place announced by the Chairman at such meeting. No
notice of an annual meeting of the Board of Directors shall be necessary, and
such meeting shall be held for the purpose of electing officers and transacting
such other business as may lawfully come before it. The Board of Directors may
provide, by resolution, the time and place, either within or outside the State
of Maryland, for the holding of regular meetings of the Board of Directors
without notice other than such resolution.

         (b) Special meetings of the Board of Directors may be called by or at
the request of the Chairman of the Board of Directors, the Chief Executive
Officer or by a majority of the members of the Board of Directors. The person or
persons authorized to call special meetings of the Board of Directors may fix
any place, either within or outside the State of Maryland, as the place for
holding any special meeting of the Board of Directors called by them.

         (c) Written notice of the time and place of all special meetings of the
Board of Directors shall be delivered personally to each director or sent by
telegram or facsimile transmission or other form of electronic transmission at
least twenty-four (24) hours before the start of the meeting, or sent by first
class mail at least five (5) days before the date of the meeting. Notice of any
meeting may be waived in writing, which shall be filed with the records of the
meeting, at any time before or after the meeting and will be waived by any
director by attendance thereat.

SECTION 3.6 QUORUM AND VOTING.

         (a) A quorum of the Board of Directors shall consist of a majority of
the exact number of directors fixed from time to time in accordance with Section
3.1; provided, however, at any meeting whether a quorum is present or otherwise,
a majority of the directors present may adjourn from time to time until the time
fixed for the next regular meeting of the Board of Directors, without notice
other than by announcement at the meeting.

         (b) At each meeting of the Board of Directors at which a quorum is
present, all questions and business shall be determined by a vote of a majority
of the directors present, unless a different vote is required by law, the
Articles of Incorporation or these Bylaws.

         (c) Any member of the Board of Directors, or of any committee thereof,
may participate in a meeting by means of conference telephone or other
communication equipment by means of which all persons participating in the
meeting can hear each other at the same time, and participation in a meeting by
such means shall constitute presence in person at such meeting.

                                       8



         (d) The transactions of any meeting of the Board of Directors, or any
committee thereof, however called or noticed, or wherever held, shall be as
valid as though had at a meeting duly held after regular call and notice if a
quorum is present and if, either before or after the meeting, each of the
directors not present signs a written waiver of notice, or a consent to holding
such meeting, or an approval of the minutes thereof. All such waivers, consents
or approvals shall be filed with the corporate records or made a part of the
minutes of the meeting.

SECTION 3.7 ACTION WITHOUT MEETING.

         Unless otherwise restricted by the Articles of Incorporation or these
Bylaws, any action required or permitted to be taken at any meeting of the Board
of Directors or of any committee thereof may be taken without a meeting, if a
unanimous written consent which sets forth the action is signed by each member
of the Board of Directors or of such committee, as the case may be, filed with
the minutes of proceedings of the Board of Directors or committee.

SECTION 3.8 FEES AND COMPENSATION.

         Directors and members of committees may receive such compensation, if
any, for their services, and such reimbursement for expenses, as may be fixed or
determined by resolution of the Board of Directors.

SECTION 3.9 PRESUMPTION OF ASSENT.

         A director of the corporation who is present at a meeting of the Board
of Directors at which action on any corporate matter is taken shall be presumed
to have assented to the action taken unless (a) such director announces his or
her dissent at the meeting and (b)(i) his or her dissent is entered in the
minutes of the meeting, (ii) he or she files his or her written dissent to such
action with the person acting as the secretary of the meeting before the
adjournment thereof or (iii) he or she forwards such dissent within twenty-four
(24) hours after the meeting is adjourned, by certified mail, return receipt
requested, bearing a postmark from the United States Postal Service to the
secretary of the meeting or the Secretary of the corporation. Such right to
dissent shall not apply to a director who voted in favor of such action or
failed to make his or her dissent known at the meeting.

SECTION 3.10 COMMITTEES.

         (a) The Board of Directors may, by resolution passed by a majority of
the whole Board of Directors, appoint an Executive Committee of one or more
directors. The Executive Committee to the extent permitted by law shall have and
may exercise all powers of the Board of Directors in the management of the
business and affairs of the corporation, except as prohibited by law. If the
Board of Directors has given general authorization for the issuance of stock
providing for or establishing a method or procedure for determining the maximum
number of shares to be issued, a committee of the Board of Directors, in
accordance with that general authorization or any stock option or other plan or
program adopted by the Board of Directors, may authorize or fix the terms of
stock subject to classification or reclassification and the terms on which any
stock may be issued, including all terms and conditions required or permitted to
be established or authorized by the Board of Directors under Sections 2-203 and
2-208 of the Maryland General Corporation Law.

                                       9



         (b) The Board of Directors may, by resolution passed by a majority of
the whole Board of Directors, from time to time appoint such other committees as
may be permitted or required by law. Such other committees appointed by the
Board of Directors shall have such powers and perform such duties as may be
prescribed by the resolution or resolutions creating such committee, but in no
event shall any such committee have the powers denied to the Executive Committee
in these Bylaws.

         (c) The members of all committees of the Board of Directors shall serve
a term coexistent with that of the Board of Directors which appointed such
committee. The Board of Directors, subject to the provisions of subsections (a)
or (b) of this Section 3.10, may at any time increase or decrease the number of
members of a committee or terminate the existence of a committee; provided that
no committee shall consist of less than one member. The membership of a
committee member shall terminate on the date of his or her death or voluntary
resignation, but the Board of Directors may at any time for any reason remove
any individual committee member and the Board of Directors may fill any
committee vacancy created by death, resignation, removal or increase in the
number of members of the committee. The Board of Directors may designate one or
more directors as alternate members of any committee, who may replace any absent
or disqualified member at any meeting of the committee, and, in addition, in the
absence or disqualification of any member of a committee, the member or members
thereof present at any meeting and not disqualified from voting, whether or not
he, she or they constitute a quorum, may unanimously appoint another member of
the Board of Directors to act at the meeting in the place of any such absent or
disqualified member.

         (d) Unless the Board of Directors otherwise provides, regular meetings
of the Executive Committee or any other committee appointed pursuant to this
Section 3.10 shall be held at such times and places as are determined by the
Board of Directors, or by any such committee, and when notice thereof has been
given to each member of such committee, no further notice of such regular
meetings need be given thereafter. Special meetings of any such committee may be
held at the principal office of the corporation or at any place which has been
designated from time to time by resolution of such committee or by written
consent of all members thereof, and may be called by any director who is a
member of such committee upon written notice to the members of such committee of
the time and place of such special meeting given in the manner provided for the
giving of written notice to members of the Board of Directors of the time and
place of special meetings of the Board of Directors. Notice of any special
meeting of any committee may be waived in writing at any time before or after
the meeting and will be waived by any director by attendance thereat. A majority
of the authorized number of members of any such committee shall constitute a
quorum for the transaction of business, and the act of a majority of those
present at any meeting at which a quorum is present shall be the act of such
committee.

                                   ARTICLE IV

                                    OFFICERS

SECTION 4.1 OFFICERS DESIGNATED.

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         The Board of Directors, promptly after its election in each year, shall
appoint a Chairman of the Board of Directors, a Vice Chairman of the Board of
Directors and a President (all of whom shall be directors) and a Treasurer and
Secretary and may appoint one or more Vice Presidents and such other officers or
assistant officers as it may deem proper. Any officer may hold more than one
office, except for the offices of President and Vice President. A person who
holds more than one office in the corporation may not act in more than one
capacity to execute, acknowledge or verify an instrument required by law to be
executed, acknowledged or verified by more than one officer. Vacancies among the
officers and assistant officers shall be filled by the Board of Directors.

SECTION 4.2 TENURE AND DUTIES OF OFFICERS.

         (a) All officers shall hold office at the pleasure of the Board of
Directors and until their successors are duly elected and qualified, unless
sooner removed. Any officer elected or appointed by the Board of Directors may
be removed at any time by the Board of Directors if the Board of Directors in
its judgment finds that the best interests of the corporation will be served. If
the office of any officer becomes vacant for any reason, the vacancy may be
filled by the Board of Directors. Nothing in these Bylaws shall be construed as
creating any kind of contractual right to employment with the corporation.

         (b) The Chairman of the Board of Directors when present shall preside
at all meetings of the stockholders and the Board of Directors. The Chairman of
the Board of Directors shall perform such other duties and have such other
powers as the Board of Directors may designate from time to time.

         (c) The Vice Chairman in the absence of the Chairman of the Board of
Directors shall preside at all meetings of the stockholders and at all meetings
of the Board of Directors. The Vice Chairman of the Board of Directors shall
perform such other duties and have such other powers as the Board of Directors
may designate from time to time.

         (d) The President shall be the chief executive officer of the
corporation and in the absence of the Chairman and Vice Chairman of the Board of
Directors, shall preside at all meetings of the stockholders and at all meetings
of the Board of Directors. The President shall perform such other duties and
have such other powers as the Board of Directors may designate from time to
time.

         (e) The Vice Presidents, in the order of their seniority, may assume
and perform the duties of the President in the absence or disability of the
President or whenever the office of the President is vacant. The Vice Presidents
shall perform such other duties and have such other powers as the Board of
Directors or the President may designate from time to time.

         (f) The Secretary shall attend all meetings of the stockholders and of
the Board of Directors and any committee thereof, and shall record all acts and
proceedings thereof in the minute book of the corporation. The Secretary shall
give notice, in conformity with these Bylaws, of all meetings of the
stockholders and of all meetings of the Board of Directors and any committee
thereof requiring notice. The Secretary shall perform such other duties and have
such other powers as the Board of Directors may designate from time to time. The
President may

                                       11



direct any assistant secretary to assume and perform the duties of the Secretary
in the absence or disability of the Secretary, and each assistant secretary
shall perform such other duties and have such other powers as the Board of
Directors or the President may designate from time to time.

         (g) The Treasurer shall keep or cause to be kept the books of account
of the corporation in a thorough and proper manner, and shall render statements
of the financial affairs of the corporation in such form and as often as
required by the Board of Directors or the President. The Treasurer, subject to
the order of the Board of Directors, shall have the custody of all funds and
securities of the corporation. The Treasurer shall perform all other duties
commonly incident to his or her office and shall perform such other duties and
have such other powers as the Board of Directors or the President may designate
from time to time. The President may direct any assistant treasurer to assume
and perform the duties of the Treasurer in the absence or disability of the
Treasurer, and each assistant treasurer shall perform such other duties and have
such other powers as the Board of Directors or the President may designate from
time to time.

                                   ARTICLE V

                     EXECUTION OF CORPORATE INSTRUMENTS AND
                  VOTING OF SECURITIES OWNED BY THE CORPORATION

SECTION 5.1 EXECUTION OF CORPORATE INSTRUMENTS.

         (a) The Board of Directors may in its discretion determine the method
and designate the signatory officer or officers, or other person or persons, to
execute any corporate instrument or document, or to sign the corporate name
without limitation, except where otherwise provided by law, and such execution
or signature shall be binding upon the corporation.

         (b) All checks and drafts drawn on banks or other depositaries on funds
to the credit of the corporation or in special accounts of the corporation shall
be signed by such person or persons as the Board of Directors may authorize.

         (c) Execution of any corporate instrument may be effected in such form,
either manual, facsimile or electronic signature, as may be authorized by the
Board of Directors.

SECTION 5.2 VOTING OF SECURITIES OWNED BY CORPORATION.

         All stock and other securities of other corporations owned or held by
the corporation for itself or for other parties in any capacity shall be voted,
and all proxies with respect thereto shall be executed, by the person authorized
so to do by resolution of the Board of Directors or, in the absence of such
authorization, by the Chairman of the Board of Directors, the President or any
Vice President.

                                   ARTICLE VI

                                 SHARES OF STOCK

SECTION 6.1 CERTIFICATES.

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         Each stockholder shall be entitled to a certificate or certificates
which represent and certify the number of shares of each class held by him or
her in the corporation; provided, however, that the Board of Directors may
provide by resolution or resolutions that some or all of any class or series of
shares may be uncertificated. Each certificate shall include on its face the
name of the corporation, the name of the stockholder or other person to whom it
is issued and the class of stock and number of shares it represents. Each
certificate shall be signed by the Chairman of the Board of Directors, the
President or any Vice President and countersigned by the Secretary or an
assistant secretary or the Treasurer or an assistant treasurer and may be sealed
with the seal, if any, of the corporation. The signatures may be either manual
or facsimile. Certificates shall be consecutively numbered; and if the
corporation issues several classes of shares, each class may have its own
numbered series. A certificate is valid and may be issued whether or not an
officer who signed it is still an officer when it is issued. A stock certificate
may not be issued until the stock represented by it is fully paid. Each
certificate representing shares which are restricted as to their transferability
shall contain a full statement of such restriction or state that the corporation
will furnish information about the restriction to the stockholder on request and
without charge. Except as otherwise provided by law, the fact that a stock
certificate does not contain or refer to a restriction on transferability that
is adopted after the date of issuance of the stock certificate does not mean
that the restriction is invalid or unenforceable. If the corporation has
authority to issue shares of more than one class, the certificate shall contain
on the face or back a full statement or summary of the designations and any
preferences, conversion and other rights, voting powers, restrictions,
limitations as to dividends and other distributions, qualifications and terms
and conditions of redemption of each class of shares which the corporation is
authorized to issue and, if the corporation is authorized to issue any preferred
or special class in series, the differences in the relative rights and
preferences between the shares of each series to the extent they have been set
and the authority of the Board of Directors to set the relative rights and
preferences of subsequent series. In lieu of such statement or summary, the
certificate may state that the corporation will furnish a full statement of such
information to any stockholder upon request and without charge.

SECTION 6.2 TRANSFERS.

         Upon surrender to the corporation or the transfer agent of the
corporation of a stock certificate duly endorsed or accompanied by proper
evidence of succession, assignment or authority to transfer, the corporation
shall issue a new certificate to the person entitled thereto, cancel the old
certificate and record the transaction on its books. Notwithstanding the
foregoing, transfers of shares of any class will be subject in all respects to
the Articles of Incorporation and all of the terms and conditions contained
therein.

SECTION 6.3 REPLACEMENT CERTIFICATE.

         The Secretary and any other officer designated by the Board of
Directors may direct a new certificate to be issued in place of any certificate
previously issued by the corporation alleged to have been lost, stolen or
destroyed upon the making of an affidavit of that fact by the person claiming
the certificate to be lost, stolen or destroyed. When authorizing the issuance
of a new certificate, the Secretary or other officer designated by the Board of
Directors may, in his or her discretion and as a condition precedent to the
issuance thereof, require the owner of such lost, stolen or destroyed
certificate or the owner's legal representative to give bond, with sufficient

                                       13



surety, to the corporation to indemnify it against any loss or claim which may
arise as a result of the issuance of a new certificate.

SECTION 6.4 STOCK LEDGER.

         The corporation shall maintain at its principal office or at the office
of its counsel, accountants or transfer agent, an original or duplicate stock
ledger containing the name and address of each stockholder and the number of
shares of each class held by such stockholder. The stock ledger may be in
written form or in any other form which can be converted within a reasonable
time into written form for visual inspection. The corporation shall be entitled
to treat the holder of record of any share as the holder in fact thereof and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such Share or on the part of any other person, whether or not it has
express or other notice thereof, except as otherwise provided by the laws of the
State of Maryland.

SECTION 6.5 ISSUANCE OF UNITS.

         Notwithstanding any other provision of these Bylaws to the contrary,
the Board of Directors may issue units consisting of different securities of the
corporation. Any security issued in a unit shall have the same characteristics
as any identical securities issued by the corporation, except that the Board of
Directors may provide that, for a specified period, securities of the
corporation issued in such unit may be transferred on the books of the
corporation only in such unit.

SECTION 6.6 FRACTIONAL SHARE INTERESTS OR SCRIP.

         The corporation may, but is not obliged to, issue fractional shares of
stock, eliminate a fractional interest by rounding off to a full share of stock,
arrange for the disposition of a fractional interest by the person entitled to
it, pay cash for the fair value of a fractional share of stock determined as of
the time when the person entitled to receive it is determined, or issue scrip,
or other evidence of ownership aggregating a full share for a certificate which
represents the share and, unless otherwise provided, does not entitle the holder
to exercise any voting rights, to receive dividends thereon or to participate in
any of the assets of the corporation in the event of liquidation. The Board of
Directors may impose any reasonable condition on the issuance of scrip or other
evidence of ownership, and may cause such scrip or other evidence of ownership
to be issued subject to the condition that it will become void if not exchanged
for a certificate representing a full share of stock before a specified date or
subject to the condition that the shares for which such scrip or other evidence
of indebtedness are exchangeable may be sold by the corporation and the proceeds
thereof distributed to the holders of such scrip or other evidence of
indebtedness, or subject to a provision of forfeiture of such proceeds to the
corporation if not claimed within a period of not less than three years from the
date the scrip or other evidence of ownership was originally issued.

SECTION 6.7 DIVIDENDS.

         If declared by the Board of Directors at any meeting thereof, the
corporation may pay dividends on its shares in cash, property, or in shares of
the capital stock of the corporation,

                                       14



unless such dividend is contrary to law or to a restriction contained in the
Articles of Incorporation.

                                  ARTICLE VII

                  EXEMPTION FROM CONTROL SHARE ACQUISITION ACT

         The provisions of Title 3, Subtitle 7 of the Maryland General
Corporation Law (the Maryland Control Share Acquisition Act), or any successor
statute, shall not apply to any acquisition by any person of shares of the
corporation. This Article VII may be repealed, in whole or in part, at any time,
whether before or after an acquisition of control shares and, upon such repeal,
may, to the extent provided by any successor bylaw and consistent with
applicable law, apply to any prior or subsequent control share acquisition.

                                  ARTICLE VIII

                       OTHER SECURITIES OF THE CORPORATION

         Each certificate which represents any bond, note, guaranty, obligation
or other corporate security (other than stock) shall be signed by the Chairman
of the Board of Directors, the President or any Vice President and countersigned
by the Secretary, an assistant secretary, the Treasurer or the assistant
treasurer. Such certificate may be sealed with the actual corporate seal or a
facsimile of it or in any other form. The signatures on the certificate may be
either manual or facsimile signatures. A certificate is valid and may be issued
whether or not an officer who signed it is still an officer at the time it is
issued.

                                   ARTICLE IX

                                 CORPORATE SEAL

         The corporate seal shall be a flat-faced circular die, of which there
may be any number of counterparts, with the word "SEAL" and the name of the
corporation engraved thereon. Said seal may be used by causing it or a facsimile
thereof to be impressed or affixed or reproduced or otherwise. If the
corporation is required to place its corporate seal to a document, it is
sufficient to meet the requirements of any law, rule or regulation relating to a
corporate seal to place the word "(seal)" adjacent to the signature of the
person authorized to sign the document on behalf of the corporation.

                                    ARTICLE X

                                   FISCAL YEAR

         The fiscal year of the corporation shall be the twelve (12) calendar
months ending December 31 in each year, unless otherwise provided by the Board
of Directors.

                                       15



                                   ARTICLE XI

                                 INDEMNIFICATION

SECTION 11.1 RIGHT TO INDEMNIFICATION.

         The corporation shall indemnify its directors and officers, whether
serving the corporation or, at its request, any other entity, to the full extent
required or permitted by the general laws of the State of Maryland now or
hereafter in force, including the advancement of expenses under the procedures
and to the full extent permitted by law. The corporation may indemnify other
employees and agents, whether serving the corporation or, at its request, any
other entity, to such extent as may be authorized by the Board of Directors and
as permitted by law. The foregoing rights of indemnification shall not be
exclusive of any other rights to which those seeking indemnification may be
entitled. The Board of Directors may take such action as is necessary to carry
out these indemnification provisions and is expressly empowered to adopt,
approve and amend from time to time resolutions or contracts implementing such
provisions or such further indemnification arrangements as may be permitted by
law. No amendment of these Bylaws or repeal of any of its provisions shall limit
or eliminate the foregoing right to indemnification provided hereunder with
respect to acts or omissions occurring prior to such amendment or repeal.

SECTION 11.2 PROVISIONS NONEXCLUSIVE.

         The rights conferred on any person by this Article XI shall not be
exclusive of any other rights that such person may have or hereafter acquire
under any statute, provision of the Articles of Incorporation, agreement, vote
of stockholders or disinterested directors, or otherwise, both as to action in
an official capacity and as to action in another capacity while holding such
office. To the extent that any provision of the Articles of Incorporation,
agreement or vote of the stockholders or disinterested directors is inconsistent
with these Bylaws, the provision, agreement or vote shall take precedence.

SECTION 11.3 AUTHORITY TO INSURE.

         The corporation may purchase and maintain insurance on behalf of any
person who is or was a director, officer, employee or agent of the corporation
or who, while a director, officer, employee or agent of the corporation, is or
was serving at the request of the corporation as a director, officer, partner,
trustee, employee or agent of another corporation, partnership, joint venture,
trust, other enterprise or employee benefit plan against any liability asserted
against and incurred by such person in any such capacity or arising out of such
person's position, whether or not the corporation would have the power to
indemnify against liability under the general laws of the State of Maryland.

SECTION 11.4 SURVIVAL OF RIGHTS.

         The rights provided by this Article shall continue as to a person who
has ceased to be a director or officer and shall inure to the benefit of the
heirs, executors and administrators of such a person.

                                       16



SECTION 11.5 SUBROGATION.

         In the event of payment under this Article, the corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of the
director or officer, who shall execute all papers required and shall do
everything that may be necessary to secure such rights, including the execution
of such documents necessary to enable the corporation effectively to bring suit
to enforce such rights.

SECTION 11.6 NO DUPLICATION OF PAYMENTS.

         The corporation shall not be liable under this Article to make any
payment in connection with any claim made against a director or officer to the
extent the director or officer has otherwise actually received payment (under
any insurance policy, agreement, vote or otherwise) of the amounts otherwise
indemnifiable hereunder.

                                       17