exv10w16



 






EXHIBIT 10.16




MASTER CREDIT FACILITY AGREEMENT




among




UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation,




WOODLAKE VILLAGE, L.P.,

a California limited partnership




and




ARCS COMMERCIAL MORTGAGE CO., L.P.,

a California limited partnership,




dated as of




December 12, 2001





 









 








TABLE OF CONTENTS




	 	 	 	 	 
	 	 	Page
	RECITALS 
	 	 	1	 
	 
	 	 	 	 
	ARTICLE I 
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II 
	 	 	18	 
	SECTION 2.01 Revolving Facility Commitment 
	 	 	18	 
	SECTION 2.02 Requests for Revolving Advances 
	 	 	18	 
	SECTION 2.03 Maturity Date of Revolving Advances 
	 	 	19	 
	SECTION 2.04 Interest on Revolving Facility Advances 
	 	 	19	 
	SECTION 2.05 Coupon Rates for Revolving Advances 
	 	 	20	 
	SECTION 2.06 Revolving Facility Note 
	 	 	20	 
	SECTION 2.07 Extension of Revolving Facility Termination Date 
	 	 	20	 
	 
	 	 	 	 
	ARTICLE III 
	 	 	21	 
	SECTION 3.01 Base Facility Commitment 
	 	 	21	 
	SECTION 3.02 Requests for Base Facility Advances 
	 	 	21	 
	SECTION 3.03 Maturity Date of Base Facility Advances 
	 	 	21	 
	SECTION 3.04 Interest on Base Facility Advances 
	 	 	21	 
	SECTION 3.05 Coupon Rates for Base Facility Advances 
	 	 	22	 
	SECTION 3.06 Base Facility Note 
	 	 	22	 
	SECTION 3.07 Conversion of Commitment from Revolving Facility Commitment to
Base Facility Commitment 
	 	 	22	 
	SECTION 3.08 Limitations on Right to Convert 
	 	 	22	 
	SECTION 3.09 Conditions Precedent to Conversion 
	 	 	23	 
	SECTION 3.10 Defeasance 
	 	 	23	 
	 
	 	 	 	 
	ARTICLE IV 
	 	 	31	 
	SECTION 4.01 Rate Setting for an Advance 
	 	 	31	 
	SECTION 4.02 Advance Confirmation Instrument for Revolving Advances 
	 	 	32	 
	SECTION 4.03 Breakage and other Costs 
	 	 	32	 
	 
	 	 	 	 
	ARTICLE V 
	 	 	32	 
	SECTION 5.01 Initial Advance 
	 	 	32	 
	SECTION 5.02 Future Advances 
	 	 	33	 
	SECTION 5.03 Conditions Precedent to Future Advances 
	 	 	33	 
	SECTION 5.04 Determination of Allocable Facility Amount and Valuations 
	 	 	34	 
	 
	 	 	 	 
	ARTICLE VI 
	 	 	34	 
	SECTION 6.01 Right to Add Collateral 
	 	 	34	 
	SECTION 6.02 Procedure for Adding Collateral 
	 	 	34	 
	SECTION 6.03 Conditions Precedent to Addition of an Additional Mortgaged
Property to the Collateral Pool 
	 	 	36	 
	 
	 	 	 	 
	ARTICLE VII 
	 	 	37	 
	SECTION 7.01 Right to Obtain Releases of Collateral 
	 	 	37	 
	SECTION 7.02 Procedure for Obtaining Releases of Collateral 
	 	 	37	 
	SECTION 7.03 Conditions Precedent to Release of Collateral Release Property
from the Collateral 
	 	 	38	 
	SECTION 7.04 Substitutions 
	 	 	39	 
	 
	 	 	 	 
	ARTICLE VIII 
	 	 	40	 
	SECTION 8.01 Right to Increase Commitment 
	 	 	40	 
	SECTION 8.02 Procedure for Obtaining Increases in Commitment 
	 	 	40	 






i









 






	 	 	 	 	 
	 	 	Page
	SECTION 8.03 Conditions Precedent to Increase in Commitment 
	 	 	41	 
	 
	 	 	 	 
	ARTICLE IX 
	 	 	41	 
	SECTION 9.01 Right to Complete or Partial Termination of Facilities 
	 	 	41	 
	SECTION 9.02 Procedure for Complete or Partial Termination of Facilities 
	 	 	41	 
	SECTION 9.03 Conditions Precedent to Complete or Partial Termination of
Facilities 
	 	 	42	 
	 
	 	 	 	 
	ARTICLE X 
	 	 	43	 
	SECTION 10.01 Right to Terminate Credit Facility 
	 	 	43	 
	SECTION 10.02 Procedure for Terminating Credit Facility 
	 	 	43	 
	SECTION 10.03 Conditions Precedent to Termination of Credit Facility 
	 	 	43	 
	 
	 	 	 	 
	ARTICLE XI 
	 	 	44	 
	SECTION 11.01 Conditions Applicable to All Requests 
	 	 	44	 
	SECTION 11.02 Delivery of Closing Documents Relating to Initial Advance
Request, Collateral Addition Request, Credit Facility Expansion
Request or Future Advance Request 
	 	 	45	 
	SECTION
11.03 Delivery of Property Related Documents 
	 	 	45	 
	 
	 	 	 	 
	ARTICLE XII 
	 	 	46	 
	SECTION 12.01 Representations and Warranties of the Borrower 
	 	 	46	 
	SECTION 12.02 Representations and Warranties of the Borrower 
	 	 	50	 
	SECTION 12.03 Representations and Warranties of the Lender 
	 	 	53	 
	 
	 	 	 	 
	ARTICLE XIII 
	 	 	53	 
	SECTION 13.01 Compliance with Agreements; No Amendments 
	 	 	53	 
	SECTION 13.02 Maintenance of Existence 
	 	 	53	 
	SECTION 13.03 Maintenance of REIT Status 
	 	 	54	 
	SECTION 13.04 Financial Statements; Accountants’ Reports; Other Information 
	 	 	54	 
	SECTION 13.05 Certificate of Compliance 
	 	 	56	 
	SECTION 13.06 Maintain Licenses 
	 	 	56	 
	SECTION 13.07 Access to Records; Discussions With Officers and Accountants 
	 	 	56	 
	SECTION 13.08 Inform the Lender of Material Events 
	 	 	57	 
	SECTION 13.09 Intentionally Omitted 
	 	 	58	 
	SECTION 13.10 Inspection 
	 	 	58	 
	SECTION 13.11 Compliance with Applicable Laws 
	 	 	58	 
	SECTION 13.12 Warranty of Title 
	 	 	58	 
	SECTION 13.13 Defense of Actions 
	 	 	58	 
	SECTION 13.14 Alterations to the Mortgaged Properties 
	 	 	59	 
	SECTION 13.15 ERISA 
	 	 	59	 
	SECTION 13.16 Loan Document Taxes 
	 	 	60	 
	SECTION 13.17 Further Assurances 
	 	 	60	 
	SECTION 13.18 Monitoring Compliance 
	 	 	60	 
	SECTION 13.19 Leases 
	 	 	60	 
	SECTION 13.20 Appraisals 
	 	 	60	 
	SECTION 13.21 Transfer of Ownership Interests of the Borrower 
	 	 	60	 
	SECTION 13.22 Change in Senior Management 
	 	 	62	 
	SECTION
13.23 Date Down Endorsements 
	 	 	62	 
	SECTION 13.24 Geographical Diversification 
	 	 	63	 
	SECTION 13.25 Ownership of Mortgaged Properties 
	 	 	63	 
	SECTION 13.26 Facility Balancing 
	 	 	63	 
	 
	 	 	 	 
	ARTICLE XIV 
	 	 	63	 
	SECTION 14.01 Other Activities 
	 	 	63	 
	SECTION 14.02 Value of Security 
	 	 	64	 






ii









 






	 	 	 	 	 
	 	 	Page
	SECTION 14.03 Zoning 
	 	 	64	 
	SECTION 14.04 Liens 
	 	 	64	 
	SECTION 14.05 Sale 
	 	 	64	 
	SECTION 14.06 Intentionally Omitted 
	 	 	64	 
	SECTION 14.07 Principal Place of Business 
	 	 	64	 
	SECTION 14.08 Intentionally Omitted 
	 	 	64	 
	SECTION 14.09 Change in Property Management 
	 	 	64	 
	SECTION 14.10 Condominiums 
	 	 	64	 
	SECTION 14.11 Restrictions on Distributions 
	 	 	65	 
	SECTION 14.12 Conduct of Business 
	 	 	65	 
	SECTION 14.13 Limitation on Unimproved Real Property and New Construction 
	 	 	65	 
	SECTION 14.14 No Encumbrance of Collateral Release Property 
	 	 	65	 
	 
	 	 	 	 
	ARTICLE XV 
	 	 	65	 
	SECTION 15.01 Financial Definitions 
	 	 	65	 
	SECTION 15.02 Compliance with Debt Service Coverage Ratios 
	 	 	70	 
	SECTION 15.03 Compliance with Loan to Value Ratios 
	 	 	70	 
	SECTION 15.04 Compliance with Concentration Test 
	 	 	70	 
	SECTION 15.05 Consolidated Adjusted Tangible Net Worth 
	 	 	70	 
	SECTION 15.06 Consolidated Funded Debt Ratio 
	 	 	70	 
	SECTION 15.07 Consolidated Total Fixed Charge Coverage Ratio 
	 	 	70	 
	SECTION 15.08 Consolidated Unencumbered Realty to Consolidated Unsecured Debt
Ratio 
	 	 	70	 
	SECTION 15.09 Consolidated Unencumbered Interest Coverage Ratio 
	 	 	70	 
	 
	 	 	 	 
	ARTICLE XVI 
	 	 	71	 
	SECTION 16.01 Standby Fee 
	 	 	71	 
	SECTION 16.02 Origination Fees 
	 	 	71	 
	SECTION 16.03 Due Diligence Fees 
	 	 	71	 
	SECTION 16.04 Legal Fees and Expenses 
	 	 	71	 
	SECTION 16.05 MBSRelated Costs 
	 	 	72	 
	SECTION 16.06 Failure to Close any Request 
	 	 	72	 
	SECTION 16.07 Other Fees 
	 	 	72	 
	 
	 	 	 	 
	ARTICLE XVII 
	 	 	73	 
	SECTION 17.01 Events of Default 
	 	 	73	 
	 
	 	 	 	 
	ARTICLE XVIII 
	 	 	75	 
	SECTION 18.01 Remedies; Waivers 
	 	 	75	 
	SECTION 18.02 Waivers; Rescission of Declaration 
	 	 	75	 
	SECTION 18.03 The Lender’s Right to Protect Collateral and Perform Covenants
and Other Obligations 
	 	 	75	 
	SECTION 18.04 No Remedy Exclusive 
	 	 	76	 
	SECTION 18.05 No Waiver 
	 	 	76	 
	SECTION 18.06 No Notice 
	 	 	76	 
	SECTION 18.07 Application of Payments 
	 	 	76	 
	 
	 	 	 	 
	ARTICLE XIX 
	 	 	76	 
	SECTION 19.01 Special Pool Purchase Contract 
	 	 	76	 
	SECTION 19.02 Assignment of Rights 
	 	 	76	 
	SECTION 19.03 Release of Collateral 
	 	 	77	 
	SECTION 19.04 Replacement of Lender 
	 	 	77	 
	SECTION 19.05 Fannie Mae and Lender Fees and Expenses 
	 	 	77	 
	SECTION 19.06 ThirdParty Beneficiary 
	 	 	77	 






iii









 






	 	 	 	 	 
	 	 	Page
	ARTICLE XX 
	 	 	77	 
	SECTION 20.01 Insurance and Real Estate Taxes 
	 	 	77	 
	SECTION 20.02 Replacement Reserves 
	 	 	77	 
	 
	 	 	 	 
	ARTICLE XXI 
	 	 	78	 
	 
	 	 	 	 
	ARTICLE XXII 
	 	 	78	 
	SECTION 22.01 Personal Liability of the Borrower 
	 	 	78	 
	 
	 	 	 	 
	ARTICLE XXIII 
	 	 	78	 
	SECTION 23.01 Counterparts 
	 	 	78	 
	SECTION 23.02 Amendments, Changes and Modifications 
	 	 	78	 
	SECTION 23.03 Payment of Costs, Fees and Expenses 
	 	 	79	 
	SECTION 23.04 Payment Procedure 
	 	 	79	 
	SECTION 23.05 Payments on Business Days 
	 	 	79	 
	SECTION 23.06 Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial 
	 	 	80	 
	SECTION 23.07 Severability 
	 	 	81	 
	SECTION 23.08 Notices 
	 	 	81	 
	SECTION 23.09 Further Assurances and Corrective Instruments 
	 	 	83	 
	SECTION 23.10 Term of this Agreement 
	 	 	84	 
	SECTION
23.11 Assignments; Third Party Rights 
	 	 	84	 
	SECTION 23.12 Headings 
	 	 	84	 
	SECTION 23.13 General Interpretive Principles 
	 	 	84	 
	SECTION 23.14 Interpretation 
	 	 	84	 
	SECTION 23.15 Decisions in Writing 
	 	 	84	 
	SECTION 23.16 Requests 
	 	 	84	 






iv









 






	 	 	 	 	 
	EXHIBIT A

	 	-
	 	Schedule of Initial Mortgaged Properties and Initial Valuations
	EXHIBIT B

	 	-
	 	Base Facility Note
	EXHIBIT C

	 	-
	 	Intentionally Omitted
	EXHIBIT D

	 	-
	 	Compliance Certificate
	EXHIBIT E

	 	-
	 	Sample Facility Debt Service
	EXHIBIT F

	 	-
	 	Organizational Certificate
	EXHIBIT G

	 	-
	 	Intentionally Omitted
	EXHIBIT H

	 	-
	 	Revolving Credit Endorsement
	EXHIBIT I

	 	-
	 	Revolving Facility Note
	EXHIBIT J

	 	-
	 	Tie-In Endorsement
	EXHIBIT K

	 	-
	 	Conversion Request
	EXHIBIT L

	 	-
	 	Conversion Amendment
	EXHIBIT M

	 	-
	 	Rate Setting Form
	EXHIBIT N

	 	-
	 	Rate Confirmation Instrument
	EXHIBIT O

	 	-
	 	Advance Confirmation Instrument
	EXHIBIT P

	 	-
	 	Future Advance Request
	EXHIBIT Q

	 	-
	 	Collateral Addition Request
	EXHIBIT R

	 	-
	 	Collateral Addition Description Package
	EXHIBIT S

	 	-
	 	Collateral Addition Supporting Documents
	EXHIBIT T

	 	-
	 	Collateral Release Request
	EXHIBIT U

	 	-
	 	Confirmation of Obligations
	EXHIBIT V

	 	-
	 	Credit Facility Expansion Request
	EXHIBIT W

	 	-
	 	Revolving Facility Termination Request
	EXHIBIT X

	 	-
	 	Revolving Facility Termination Document
	EXHIBIT Y

	 	-
	 	Credit Facility Termination Request
	EXHIBIT Z

	 	-
	 	Intentionally Omitted
	EXHIBIT AA

	 	-
	 	Independent Unit Encumbrances






v









 






MASTER CREDIT FACILITY AGREEMENT




     THIS
MASTER CREDIT FACILITY AGREEMENT is made as of the 12th day of
December, 2001 by (i) UNITED DOMINION REALTY TRUST, INC., a Virginia corporation
(“UDRT”), (ii) WOODLAKE VILLAGE, L.P., a California limited partnership



     (“Woodlake”) (individually and collectively, UDRT and Woodlake, the “Borrower”),
and (iii) ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership
(the “Lender”).



RECITALS




     A. The Borrower owns one or more Multifamily Residential Properties
(capitalized terms used but not defined shall have the meanings ascribed to such
terms in Article I of this Agreement) as more particularly described in Exhibit A to this Agreement.



     B. The Borrower has requested that the Lender establish a $300,000,000
Credit Facility in favor of the Borrower, comprised initially of a $300,000,000
Revolving Facility, all or part of which can be converted to a Base Facility in
accordance with, and subject to, the terms and conditions of this Agreement and
a $0 Base Facility.



     C. To secure the obligations of the Borrower under this Agreement and the
other Loan Documents issued in connection with the Credit Facility, the Borrower
shall create a Collateral Pool in favor of the Lender. The Collateral Pool shall
be comprised of (i) Security Instruments on all of the Multifamily Residential
Properties owned by the Borrower listed on Exhibit A to this Agreement and (ii)
any other Security Documents executed by the Borrower pursuant to this Agreement
or any other Loan Documents.



     D. Each of the Security Documents shall be cross-defaulted (i.e., a
default under any Security Document, or under this Agreement, shall constitute a
default under each Security Document, and this Agreement) and
cross-collateralized (i.e., each Security Instrument shall secure all of the
Borrower’s obligations under this Agreement and the other Loan Documents issued
in connection with the Credit Facility) and it is the intent of the parties to
this Agreement that the Lender may accelerate any Note without the necessity to
accelerate any other Note and that in the exercise of its rights and remedies
under the Loan Documents, Lender may exercise and perfect any and all of its
rights in and under the Loan Documents with regard to any Mortgaged Property
without the necessity to exercise and perfect its rights and remedies with
respect to any other Mortgaged Property and that any such exercise shall be
without regard to the Allocable Facility Amount assigned to such Mortgaged
Property and that Lender may recover an amount equal to the full amount
outstanding in respect of any of the Notes in connection with such exercise and
any such amount shall be applied as determined by Lender in its sole and
absolute discretion.



     E. Subject to the terms, conditions and limitations of this Agreement,
the Lender has agreed to establish the Credit Facility.



     NOW, THEREFORE, the Borrower and the Lender, in consideration of the mutual
promises and agreements contained in this Agreement, hereby agree as follows:




-1-









 








ARTICLE I

DEFINITIONS



For all purposes of this Agreement, the following terms shall have the
respective meanings set forth below:





     “Acquiring Person” means a “person” or “group of persons” within the
meaning of Sections 13(d) and 14(d) of the Securities Exchange Act of 1934,
as amended.




     “Additional Mortgaged Property” means each Multifamily Residential
Property owned by the Borrower (either in fee simple or as tenant under a
ground lease meeting all of the requirements of the DUS Guide) and added to
the Collateral Pool after the Initial Closing Date pursuant to Article VI.




     “Advance” means a Revolving Advance or a Base Facility Advance.




     “Advance Confirmation Instrument” shall have the meaning set forth in
Section 4.02.




     “Affiliate” means, with respect to any Person, any other Person (i)
directly or indirectly controlling or controlled by or under direct or
indirect common control with such Person or (ii) directly or indirectly
owning or holding five percent (5%) or more of the equity interest in such
Person. For purposes of this definition, “control” when used with respect
to any Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms “controlling” and
“controlled” have meanings correlative to the foregoing.




     “Aggregate Debt Service Coverage Ratio for the Trailing 12 Month
Period” means, for any specified date, the ratio (expressed as a
percentage) of—




(a) the aggregate of the Net Operating Income for the Trailing 12
Month Period for the Mortgaged Properties



to





(b) the Facility Debt Service on the specified date.




     “Aggregate Loan to Value Ratio for the Trailing 12 Month Period”
means, for any specified date, the ratio (expressed as a percentage) of—




	 	(a)	 	the Advances Outstanding on the specified date,





to





	 	(b)	 	the aggregate of the Valuations most recently obtained prior to
the specified date for all of the Mortgaged Properties.




-2-









 












     “Agreement” means this Master Credit Facility Agreement, as it may be
amended, supplemented or otherwise modified from time to time, including
all Recitals and Exhibits to this Agreement, each of which is hereby
incorporated into this Agreement by this reference.




     “Allocable Facility Amount” means the portion of the Credit Facility
allocated to a particular Mortgaged Property by Lender in accordance with
this Agreement. Lender shall determine the Allocable Facility Amount for
each Mortgaged Property on the Initial Closing Date and on or before
January 1 of each year (commencing January 1, 2002) during the term of this
Agreement and at such other times as provided by this Agreement (the
“Determination Date”). Once determined by Lender as aforesaid, the
Allocable Facility Amount for each Mortgaged Property shall be promptly
disclosed to Borrower by Lender and shall remain in effect until the next
Determination Date. The Allocable Facility Amount for any Additional
Mortgaged Property shall be 70% of the Valuation of such Mortgaged Property
on the date such Mortgaged Property is added to the Collateral Pool.




     “Amortization Period” means, with respect to each Base Facility
Advance, the period of 30 years.




     “Applicable Law” means (a) all applicable provisions of all
constitutions, statutes, rules, regulations and orders of all governmental
bodies, all Governmental Approvals and all orders, judgments and decrees of
all courts and arbitrators, (b) all zoning, building, environmental and
other laws, ordinances, rules, regulations and restrictions of any
Governmental Authority affecting the ownership, management, use, operation,
maintenance or repair of any Mortgaged Property, including the Americans
with Disabilities Act (if applicable), the Fair Housing Amendment Act of
1988 and Hazardous Materials Laws, (c) any building permits or any
conditions, easements, rights-of-way, covenants, restrictions of record or
any recorded or unrecorded agreement affecting or concerning any Mortgaged
Property including planned development permits, condominium declarations,
and reciprocal easement and regulatory agreements with any Governmental
Authority, (d) all laws, ordinances, rules and regulations, whether in the
form of rent control, rent stabilization or otherwise, that limit or impose
conditions on the amount of rent that may be collected from the units of
any Mortgaged Property, and (e) requirements of insurance companies or
similar organizations, affecting the operation or use of any Mortgaged
Property or the consummation of the transactions to be effected by this
Agreement or any of the other Loan Documents.




     “Appraisal” means an appraisal of a Multifamily Residential Property
or Multifamily Residential Properties conforming to the requirements of
Chapter 5 of Part III of the DUS Guide, and accepted by the Lender.




     “Appraised Value” means the value set forth in an Appraisal.




     “Base Facility” means the agreement of the Lender to make Base
Facility Advances to the Borrower pursuant to Section 3.01.



-3-









 






     “Base Facility Advance” means a loan made by the Lender to the
Borrower under the Base Facility Commitment.




     “Base Facility Availability Period” means the period beginning on the
Initial Closing Date and ending on the date five (5) years after the
Initial Closing Date.




     “Base Facility Commitment” means $0, plus such amount as the Borrower
may elect to add to the Base Facility Commitment in accordance with
Articles III or VIII.




     “Base Facility Fee” means (i) 50 basis points for a Base Facility
Advance drawn from the Base Facility Commitment initially available
(whether drawn or undrawn) under this Agreement or converted from the
Revolving Facility Commitment during the period ending on the date 12
months after the Initial Closing Date, and (ii) for any Base Facility
Advance drawn from any portion of the Base Facility Commitment increased
under Article VIII or converted from any portion of the Revolving Facility
Commitment after the period ending on the date 12 months after the Initial
Closing Date, the number of basis points determined at the time of such
increase by the Lender as the Base Facility Fee for such Base Facility
Advances, provided that in no event shall the Base Facility Fee for Base
Facility Advances converted from the Revolving Facility Commitment
(expressed as a number of basis points) exceed the Revolving Facility Fee.




     “Base Facility Note” means a promissory note, in the form attached as
Exhibit B to this Agreement, which will be issued by the Borrower to the
Lender, concurrently with the funding of each Base Facility Advance, to
evidence the Borrower’s obligation to repay the Base Facility Advance.




     “Borrower” means, individually and collectively, United Dominion
Realty Trust, Inc., a Virginia corporation, and Woodlake Village, L.P., a
California limited partnership.




     “Business Day” means a day on which Fannie Mae is open for business.




     “Calendar Quarter” means, with respect to any year, any of the
following three month periods: (a) January-February-March; (b)
April-May-June; (c) July-August-September; and (d)
October-November-December.




     “Cap Rate” means, for each Mortgaged Property, a capitalization rate
reasonably selected by the Lender for use in determining the Valuations, as
disclosed to the Borrower from time to time.




     “Change of Control” means the earliest to occur of: (a) the date on
which UDRT shall cease for any reason to be the holder, directly or
indirectly, of at least 70% of the voting interests of any other Borrower
or to own, directly or indirectly at least 70% of the equity, profits or
other partnership interest in, or Voting Equity Capital (or any other
Securities or ownership interests) of any other Borrower, (b) the date on
which an Acquiring Person or Acquiring Persons becomes (by acquisition,
consolidation, merger or otherwise), directly or indirectly, the beneficial
owner of more than, in the aggregate, 30% of the total Voting Equity
Capital (or of any other Securities or ownership interest) of the Borrower
then outstanding, or (c) the replacement (other than solely by reason of
retirement at age sixty



-4-









 






five or older, death or disability) of more than 50% (or such lesser
percentage as is required for decision-making by the board of directors or
an equivalent governing body) of the members of the board of directors (or
an equivalent governing body) of the Borrower over a one-year period from
the directors who constituted such board of directors at the beginning of
such period and such replacement shall not have been approved by a vote of
at least a majority of the board of directors of the Borrower then still in
office who either were members of such board of directors at the beginning
of such one-year period or whose election as members of the board of
directors was previously so approved (it being understood and agreed that
in the case of any entity governed by a trustee, board of managers, or
other similar governing body, the foregoing clause (c) shall apply thereto
by substituting such governing body and the members thereof for the board
of directors and members thereof, respectively).




     “Closing Date” means the Initial Closing Date and each date after the
Initial Closing Date on which the funding or other transaction requested in
a Request is required to take place.




     “Collateral” means, the Mortgaged Properties and other collateral from
time to time or at any time encumbered by the Security Instruments, or any
other property securing any of the Borrower’s obligations under the Loan
Documents.




     “Collateral Addition Fee” means, with respect to a Multifamily
Residential Property added to the Collateral Pool in accordance with
Article VI—




     (i) 75 basis points, multiplied by




     (ii) 70% of the Initial Valuation of the Multifamily
Residential Property, as determined by the Lender.




provided that no Collateral Addition Fee shall be due and payable until
aggregate Advances (regardless of the amount of Advances Outstanding) in
the amount of $300,000,000 have been made.




     “Collateral Addition Loan Documents” means the Security Instrument
covering an Additional Mortgaged Property and any other documents,
instruments or certificates required by the Lender in connection with the
addition of the Additional Mortgaged Property to the Collateral Pool
pursuant to Article VI.




     “Collateral Addition Request” shall have the meaning set forth in
Section 6.02(a).




     “Collateral Pool” means the aggregate total of the Collateral.




     “Collateral Release Request” shall have the meaning set forth in
Section 7.02(a).




     “Collateral Release Property” shall have the meaning set forth in
Section 7.02(a).




     “Commitment” means, at any time, the sum of the Base Facility
Commitment and the Revolving Facility Commitment.



-5-









 






     “Complete Revolving Facility Termination” shall have the meaning set
forth in Section 9.02(a).




     “Compliance Certificate” means a certificate of the Borrower in the
form attached as Exhibit D to this Agreement.




     “Conversion Documents” has the meaning specified in Section 3.07(b)
hereof.




     “Conversion Request” has the meaning specified in Section 3.07(a)
hereof.




     “Coupon Rate” means, with respect a Revolving Advance, the imputed
interest rate determined by the Lender pursuant to Section 2.05 for the
Revolving Advance and, with respect a Base Facility Advance, the interest
rate determined by the Lender pursuant to Section 3.05 for the Base
Facility Advance.




     “Coverage and LTV Tests” mean, for any specified date, each of the
following financial tests:




          (a) The Aggregate Debt Service Coverage Ratio for the
Trailing 12 Month Period is not less than 130%.




          (b) The Aggregate Loan to Value Ratio for the Trailing
12 Month Period does not exceed 70%.




     “Credit Facility” means the Base Facility and the Revolving Facility.




     “Credit Facility Expansion” means an increase in the Commitment made
in accordance with Article VIII.




     “Credit Facility Expansion Loan Documents” means amendments to the
Revolving Facility Note or the Base Facility Note, as the case may be,
increasing the amount of such Note to the amount of the Commitment, as
expanded in accordance with Article VIII and amendments to the Security
Instruments, increasing the amount secured by such Security Instruments to
the amount of the Commitment.




     “Credit Facility Expansion Request” shall have the meaning set forth
in Section 8.02(a).




     “Credit Facility Termination Request” shall have the meaning set forth
in Section 10.02(a).




     “Debt Service Coverage Ratio for the Trailing 12 Month Period” means,
for any Mortgaged Property, for any specified date, the ratio (expressed as
a percentage) of —




(a) the aggregate of the Net Operating Income for the Trailing 12
Month Period for the subject Mortgaged Property



to




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	 	(b)	 	the Facility Debt Service on the specified date, assuming,
for the purpose of calculating the Facility Debt Service for this
definition, that Advances Outstanding shall be the Allocable
Facility Amount for the subject Mortgaged Property.






     “Discount” means, with respect to any Revolving Advance, an amount
equal to the excess of —




	 	(i)	 	the face amount of the MBS backed by the Revolving Advance,
over
	 
	 	(ii)	 	the Price of the MBS backed by the Revolving Advance.






     “DUS Guide” means the Fannie Mae Multifamily Delegated Underwriting
and Servicing (DUS) Guide, as such Guide may be amended from time to time,
including exhibits to the DUS Guide and amendments in the form of Lender
Memos, Guide Updates and Guide Announcements (and, if such Guide is no
longer used by Fannie Mae, the term “DUS Guide” as used in this Agreement
means the Fannie Mae Multifamily Negotiated Transactions Guide, as such
Guide may be amended from time to time, including amendments in the form of
Lender Memos, Guide Updates and Guide Announcements). All references to
specific articles and sections of, and exhibits to, the DUS Guide shall be
deemed references to such articles, sections and exhibits as they may be
amended, modified, updated, superseded, supplemented or replaced from time
to time.




     “DUS Underwriting Requirements” means the overall underwriting
requirements for Multifamily Residential Properties as set forth in the DUS
Guide.




     “ERISA” means the Employee Retirement Income Security Act of 1974, as
amended from time to time.




     “Event of Default” means any event defined to be an “Event of Default”
under Article XVII.




     “Facility Debt Service” means, as of any specified date, the sum of:




	 	(a)	 	the amount of interest and principal amortization, during the 12
month period immediately succeeding the specified date, with
respect to the Advances Outstanding on the specified date,
except that, for these purposes:






	 	(i)	 	each Revolving Advance shall be deemed to require level
monthly payments of principal and interest (at the
Coupon Rate for the Revolving Advance) in an amount
necessary to fully amortize the original principal
amount of the Revolving Advance over a 30-year period,
with such amortization deemed to commence on the first
day of the 12 month period; and
	 
	 	(ii)	 	each Base Facility Advance shall require level monthly
payments of principal and interest (at the Coupon Rate
for the Base Facility Advance) in an amount necessary
to fully amortize the original principal amount of the
Base Facility Advance over a 30-year period,




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     with such amortization to commence on the first day of the
12 month period; and




	 	(b)	 	the amount of the Standby Fees payable to the Lender pursuant to
Section 16.01 during such 12 month period (assuming, for these
purposes, that the Advances Outstanding throughout the 12 month
period are always equal to the amount of Advances Outstanding on
the specified date).






Exhibit E to this Agreement contains an example of the determination of the
Facility Debt Service.




     “Facility Termination Fee” means, with respect to a reduction in the
Revolving Facility Commitment pursuant to Articles IX or X, an amount equal
to the product obtained by multiplying—




	 	(1)	 	the reduction in the Revolving Facility Commitment, by
	 
	 	(2)	 	the Revolving Facility Fee in effect at such time, by
	 
	 	(3)	 	the present value factor calculated using the following formula:





	 
	1 - (1 + r)/-n/

	 

	r








[r = Yield Rate




	 	 	 	n = the number of years, and any fraction thereof, remaining between
the Closing Date for the reduction in the Revolving Facility
Commitment and the Revolving Facility Termination Date]






The “Yield Rate” means the rate on the Three-Month LIBOR on the second
Business Day preceding, as applicable, (x) the date of the reduction in the
Commitment, (y) the date of the Complete Facility Termination or (z) the
date of Lender’s acceleration of the unpaid principal balance of the
Facility Note.




     “Fannie Mae” means the federally-chartered and stockholder-owned
corporation organized and existing under the Federal National Mortgage
Association Charter Act, 12 U.S.C. (S) 1716 et seq.




     “Financial Covenants” means the covenants set forth in Article XV.




     “Future Advance” means an Advance made after the Initial Closing Date.




     “Future Advance Request” shall have the meaning set forth in Section
5.02.




     “GAAP” means generally accepted accounting principles in the United
States in effect from time to time, consistently applied.




     “General Conditions” shall have the meaning set forth in Article XI.



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          “Geographical Diversification Requirements” means, from and
after the date on which the Collateral Pool first consists of ten (10)
or more Mortgaged Properties, and prior to the occurrence of an
increase in the Commitment pursuant to Article VIII, a requirement that
the Collateral Pool consist of at least nine (9) Mortgaged Properties
located in at least five (5) SMSA’s and, upon the occurrence of any
increase in the Commitment pursuant to Article VIII, such requirements
as to the geographical diversity of the Collateral Pool as the Lender
may reasonably determine and notify Borrower of prior to the time of
the increase.




          “Governmental Approval” means an authorization, permit,
consent, approval, license, registration or exemption from registration
or filing with, or report to, any Governmental Authority.




          “Governmental Authority” means any court, board, agency,
commission, office or authority of any nature whatsoever for any
governmental unit (federal, state, county, district, municipal, city or
otherwise) whether now or hereafter in existence.




          “Gross Revenues” means, for any specified period, with respect
to any Multifamily Residential Property, all income in respect of such
Multifamily Residential Property, as determined by the Lender in
accordance with the method described in paragraph 3 of Section 403.02
of Part III of the DUS Guide, except that for these purposes the
financial statements to be used need not be audited and paragraph (b)
of such paragraph 3 shall be taken into account in the Lender’s
discretion.




          “Hazardous Materials”, with respect to any Mortgaged Property,
shall have the meaning given that term in the Security Instrument
encumbering the Mortgaged Property.




          “Hazardous Materials Law”, with respect to any Mortgaged
Property, shall have the meaning given that term in the Security
Instrument encumbering the Mortgaged Property.




          “Hazardous Substance Activity” means any storage, holding,
existence, release, spill, leaking, pumping, pouring, injection,
escaping, deposit, disposal, dispersal, leaching, migration, use,
treatment, emission, discharge, generation, processing, abatement,
removal, disposition, handling or transportation of any Hazardous
Materials from, under, into or on any Mortgaged Property in violation
of Hazardous Materials Laws, including the discharge of any Hazardous
Materials emanating from any Mortgaged Property in violation of
Hazardous Materials Laws through the air, soil, surface water,
groundwater or property and also including the abandonment or disposal
of any barrels, containers and other receptacles containing any
Hazardous Materials from or on any Mortgaged Property in violation of
Hazardous Materials Laws, in each case whether sudden or nonsudden,
accidental or nonaccidental.




          “Impositions” means, with respect to any Mortgaged Property,
all (1) water and sewer charges which, if not paid, may result in a
lien on all or any part of the Mortgaged Property, (2) premiums for
fire and other hazard insurance, rent loss insurance and such other
insurance as Lender may require under any Security Instrument, (3)
Taxes, and (4) amounts for other charges and expenses which Lender at
any time reasonably deems



-9-









 






necessary to protect the Mortgaged Property, to prevent the imposition
of liens on the Mortgaged Property, or otherwise to protect Lender’s
interests.




          “Indebtedness” means, with respect to any Person, as of any
specified date, without duplication, all:




               (a) indebtedness of such Person for borrowed money or
for the deferred purchase price of property or services (other than
current trade liabilities incurred in the ordinary course of business
and payable in accordance with customary practices);




               (b) other indebtedness of such Person which is
evidenced by a note, bond, debenture or similar instrument;




               (c) obligations of such Person under any lease of
property, real or personal, the obligations of the lessee in respect of
which are required by GAAP to be capitalized on a balance sheet of the
lessee or to be otherwise disclosed as such in a note to such balance
sheet;




               (d) obligations of such Person in respect of
acceptances (as defined in Article 3 of the Uniform Commercial Code of
the Commonwealth of Virginia) issued or created for the account of such
Person;




               (e) liabilities secured by any Lien on any property
owned by such Person even though such Person has not assumed or
otherwise become liable for the payment of such liabilities; and




               (f) as to any Person (“guaranteeing person”), any
obligation of (a) the guaranteeing person or (b) another Person
(including any bank under any letter of credit) to induce the creation
of a primary obligation (as defined below) with respect to which the
guaranteeing person has issued a reimbursement, counterindemnity or
similar obligation, in either case guaranteeing, or in effect
guaranteeing, any indebtedness, lease, dividend or other obligation
(“primary obligations”) of any third person (“primary obligor”) in any
manner, whether directly or indirectly, including any obligation of the
guaranteeing person, whether or not contingent, to (1) purchase any
such primary obligation or any property constituting direct or indirect
security therefor, (2) advance or supply funds for the purchase or
payment of any such primary obligation or to maintain working capital
or equity capital of the primary obligor or otherwise to maintain the
net worth or solvency of the primary obligor, (3) purchase property,
securities or services primarily for the purpose of assuring the owner
of any such primary obligation of the ability of the primary obligor to
make payment of such primary obligation, or (4) otherwise assure or
hold harmless the owner of any such primary obligation against loss in
respect of the primary obligation, provided, however, that the term
“Contingent Obligation“ shall not include endorsements of instruments
for deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation of any guaranteeing person shall be
deemed to be the lesser of (i) an amount equal to the stated or
determinable amount of the primary obligation in respect of which such
Contingent Obligation is made and (ii) the maximum amount for which
such guaranteeing person may be liable pursuant to the terms of the
instrument embodying such



-10-









 






Contingent Obligation, unless such primary obligation and the maximum
amount for which such guaranteeing person may be liable are not stated
or determinable, in which case the amount of such Contingent Obligation
shall be such guaranteeing person’s maximum reasonably anticipated
liability in respect thereof as determined by Owner in good faith.




          “Initial Advance” means the Revolving Advance made on the
Initial Closing Date in the amount of $30,900,000.




          “Initial Advance Request” shall have the meaning set forth in
Section 5.01.




          “Initial Closing Date” means the date of this Agreement.




          “Initial Mortgaged Properties” means the Multifamily
Residential Properties described on Exhibit A to this Agreement and
which represent the Multifamily Residential Properties which are made
part of the Collateral Pool on the Initial Closing Date.




          “Initial Security Instruments” means the Security Instruments
covering the Initial Mortgaged Properties.




          “Initial Valuation” means, when used with reference to
specified Collateral, the Valuation initially performed for the
Collateral as of the date on which the Collateral was added to the
Collateral Pool. The Initial Valuation for each of the Initial
Mortgaged Properties is as set forth in Exhibit A to this Agreement.




          “Insurance Policy” means, with respect to a Mortgaged
Property, the insurance coverage and insurance certificates evidencing
such insurance required to be maintained pursuant to the Security
Instrument encumbering the Mortgaged Property.




          “Internal Revenue Code” means the Internal Revenue Code of
1986, as amended. Each reference to the Internal Revenue Code shall be
deemed to include (a) any successor internal revenue law and (b) the
applicable regulations whether final, temporary or proposed.




          “Lease” means any lease, any sublease or subsublease, license,
concession or other agreement (whether written or oral and whether now
or hereafter in effect) pursuant to which any Person is granted a
possessory interest in, or right to use or occupy all or any portion of
any space in any Mortgaged Property, and every modification, amendment
or other agreement relating to such lease, sublease, subsublease or
other agreement entered into in connection with such lease, sublease,
subsublease or other agreement, and every guarantee of the performance
and observance of the covenants, conditions and agreements to be
performed and observed by the other party thereto.




          “Lender” shall have the meaning set forth in the first
paragraph of this Agreement, but shall refer to any replacement Lender
if the initial Lender is replaced pursuant to the terms of Section
19.04.




          “Lien” means any mortgage, pledge, hypothecation, assignment,
deposit arrangement, security interest, encumbrance, lien (statutory or
otherwise), preference,



-11-









 






priority or charge of any kind (including any agreement to give any of
the foregoing, any conditional sale or other title retention agreement,
any financing or similar statement or notice filed under the Uniform
Commercial Code as adopted and in effect in the relevant jurisdiction
or other similar recording or notice statute, and any lease in the
nature thereof).




          “Loan Documents” means this Agreement, the Notes, the Advance
Confirmation Instruments for the Revolving Advances, the Security
Documents, all documents executed by the Borrower pursuant to the
General Conditions set forth in Article XI of this Agreement and any
other documents executed by the Borrower from time to time in
connection with this Agreement or the transactions contemplated by this
Agreement.




          “Loan to Value Ratio for the Trailing 12 Month Period” means,
for a Mortgaged Property, for any specified date, the ratio (expressed
as a percentage) of —




(a) the Allocable Facility Amount of the subject Mortgaged
Property on the specified date,



to





(b) the Valuation most recently obtained prior to the
specified date for the subject Mortgaged Property.




“Loan Year” means the 12-month period from the first day of
the first calendar month after the Initial Closing Date to and
including the last day before the first anniversary of the Initial
Closing Date, and each 12-month period thereafter.




“Material Adverse Effect” means, with respect to any
circumstance, act, condition or event of whatever nature (including any
adverse determination in any litigation, arbitration, or governmental
investigation or proceeding), whether singly or in conjunction with any
other event or events, act or acts, condition or conditions, or
circumstance or circumstances, whether or not related, a material
adverse change in or a materially adverse effect upon any of (a) the
business, operations, property or condition (financial or otherwise) of
the Borrower, (b) the present or future ability of the Borrower to
perform the Obligations for which it is liable, (c) the validity,
priority, perfection or enforceability of this Agreement or any other
Loan Document or the rights or remedies of the Lender under any Loan
Document, or (d) the value of, or the Lender’s ability to have recourse
against, any Mortgaged Property.




“MBS” means a mortgage-backed security which is “backed“ by an
Advance which is secured by an interest in the Notes and the Collateral
Pool securing the Notes, which interest permits the holder of the MBS
to participate in the Notes and the Collateral Pool to the extent of
such Advance.




“MBS Imputed Interest Rate” shall have the meaning set forth
in Section 2.05(a).




“MBS Issue Date” means the date on which a Fannie Mae MBS is
issued by Fannie Mae.



-12-









 






“MBS Delivery Date” means the date on which a Fannie Mae MBS
is delivered by Fannie Mae.




“MBS Pass-Through Rate” for a Base Facility Advance means the
interest rate as determined by the Lender (rounded to three places)
payable in respect of the Fannie Mae MBS issued pursuant to the MBS
Commitment backed by the Base Facility Advance as determined in
accordance with Section 4.01.




“Mortgaged Properties” means, collectively, the Additional
Mortgaged Properties and the Initial Mortgaged Properties, but
excluding each Collateral Release Property from and after the date of
the release of the Collateral Release Property from the Collateral
Pool.




“Multifamily Residential Property” means a residential
property, located in the United States, containing five or more
dwelling units in which not more than twenty percent (20%) of the net
rentable area is or will be rented to non-residential tenants, and
conforming to the requirements of Sections 201 and 203 of Part III of
the DUS Guide.




“Net Operating Income” means, for any specified period, with
respect to any Multifamily Residential Property, the aggregate net
income during such period equal to Gross Revenues during such period
less the aggregate Operating Expenses during such period. If a
Mortgaged Property is not owned by the Borrower for the entire
specified period, the Net Operating Income for the Mortgaged Property
for the time within the specified period during which the Mortgaged
Property was owned by the Borrower shall be the Mortgaged Property’s
pro forma net operating income determined by the Lender in accordance
with the underwriting procedures set forth in Chapter 4 of Part III of
the DUS Guide.




“Note” means a Base Facility Note or the Revolving Facility
Note.




“Obligations” means the aggregate of the obligations of the
Borrower under this Agreement and the other Loan Documents.




“Operating Expenses” means, for any period, with respect to
any Multifamily Residential Property, all expenses in respect of the
Multifamily Residential Property, as determined by the Lender in
accordance with the method described in paragraph 3 of Section 403.02
of Part III of the DUS Guide (Estimated Expenses), including
replacement reserves, if any, under the Replacement Reserve Agreements
for the Mortgaged Properties.




“Organizational Certificate” means a certificate of the
Borrower in the form attached as Exhibit F to this Agreement.




“Organizational Documents” means all certificates, instruments
and other documents pursuant to which an organization is organized or
operates, including but not limited to, (i) with respect to a
corporation, its articles of incorporation and bylaws, (ii) with
respect to a limited partnership, its limited partnership certificate
and partnership agreement, (iii) with respect to a general partnership
or joint venture, its partnership or joint venture agreement and (iv)
with respect to a limited liability company, its articles of
organization and operating agreement.



-13-









 






     “Outstanding” means, when used in connection with promissory notes,
other debt instruments or Advances, for a specified date, promissory notes
or other debt instruments which have been issued, or Advances which have
been made, but have not been repaid in full as of the specified date.




     “Ownership Interests” means, with respect to any entity, any ownership
interests in the entity and any economic rights (such as a right to
distributions, net cash flow or net income) to which the owner of such
ownership interests is entitled.




     “PBGC” means the Pension Benefit Guaranty Corporation or any entity
succeeding to any or all of its functions under ERISA.




     “Permits” means all permits, or similar licenses or approvals issued
and/or required by an applicable Governmental Authority or any Applicable
Law in connection with the ownership, use, occupancy, leasing, management,
operation, repair, maintenance or rehabilitation of any Mortgaged Property
or the Borrower’s business.




     “Permitted Liens” means, with respect to a Mortgaged Property, (i) the
exceptions to title to the Mortgaged Property set forth in the Title
Insurance Policy for the Mortgaged Property which are approved by the
Lender, (ii) the Security Instrument encumbering the Mortgaged Property,
and (iii) any other Liens approved by the Lender.




     “Person” means an individual, an estate, a trust, a corporation, a
partnership, a limited liability company or any other organization or
entity (whether governmental or private).




     “Potential Event of Default” means any event which, with the giving of
notice or the passage of time, or both, would constitute an Event of
Default.




     “Price” means, with respect to an Advance, the proceeds of the sale of
the MBS backed by the Advance.




     “Property” means any estate or interest in any kind of property or
asset, whether real, personal or mixed, and whether tangible or intangible.




     “Rate Confirmation Form” shall have the meaning set forth in Section
4.01(c).




     “Rate Setting Date” shall have the meaning set forth in Section
4.01(b).




     “Rate Setting Form” shall have the meaning set forth in Section
4.01(b).




     “Release Price” shall have the meaning set forth in Section 7.02(c).




     “Rent Roll” means, with respect to any Multifamily Residential
Property, a rent roll prepared and certified by the owner of the
Multifamily Residential Property, on Fannie Mae Form 4243, as set forth in
Exhibit III-3 of the DUS Guide, or on another form approved by the Lender
and containing substantially the same information as Form 4243 requires.



-14-









 






     “Replacement Reserve Agreement” means a Replacement Reserve and
Security Agreement, reasonably required by the Lender, and completed in
accordance with the requirements of the DUS Guide.




     “Request” means a Collateral Addition Request, a Collateral Release
Request, a Conversion Request, a Credit Facility Expansion Request, a
Credit Facility Termination Request, a Future Advance Request, an Initial
Advance Request or a Revolving Facility Termination Request.




     “Revolving Advance” means a loan made by the Lender to the Borrower
under the Revolving Facility Commitment.




     “Revolving Credit Endorsement” means an endorsement to a Title
Insurance Policy which contains substantially the same coverages, and is
subject to substantially the same or fewer exceptions (or such other
exceptions as the Lender may approve), as the form attached as Exhibit H to
this Agreement.




     “Revolving Facility” means the agreement of the Lender to make
Advances to the Borrower pursuant to Section 2.01.




     “Revolving Facility Availability Period” means the period beginning on
the Initial Closing Date and ending on the 90th day before the Revolving
Facility Termination Date.




     “Revolving Facility Commitment” means an aggregate amount of
$300,000,000 which shall be evidenced by the Revolving Facility Note in the
form attached hereto as Exhibit I, plus such amount as the Borrower may
elect to add to the Revolving Facility Commitment in accordance with
Article VIII, and less such amount as the Borrower may elect to convert
from the Revolving Facility Commitment to the Base Facility Commitment in
accordance with Article III and less such amount by which the Borrower may
elect to reduce the Revolving Facility Commitment in accordance with
Article IX.




     “Revolving Facility Fee” means (i) 60 basis points per annum for a
Revolving Advance drawn from the Revolving Facility Commitment available
(whether drawn or undrawn) under this Agreement during the period ending on
the date 12 months after the Initial Closing Date, (ii) for any extended
term of the Revolving Facility, the number of basis points per annum
determined by the Lender as the Revolving Facility Fee for such period,
which fee shall be set by Lender not less than 30 days prior to the
commencement of such period, and (iii) for any Revolving Advance drawn from
any portion of the Revolving Facility Commitment increased under Article
VIII after the date 12 months after the Initial Closing Date, the number of
basis points per annum determined at the time of such increase by the
Lender as the Revolving Facility Fee for such Revolving Advances.




     “Revolving Facility Note” means the promissory note, in the form
attached as Exhibit I to this Agreement, which has been issued by the
Borrower to the Lender to evidence the Borrower’s obligation to repay
Revolving Advances.




     “Revolving Facility Termination Date” means the last day of the tenth
Loan Year, as such date may be extended pursuant to Section 2.07 of this
Agreement.



-15-









 






     “Security” means a “security“ as set forth in Section 2(1) of the
Securities Act of 1933, as amended.




     “Security Documents” means the Security Instruments, the Replacement
Reserve Agreements and any other documents executed by a Borrower from time
to time to secure any of the Borrower’s obligations under the Loan
Documents.




     “Security Instrument” means, for each Mortgaged Property, a separate
Multifamily Mortgage, Deed of Trust or Deed to Secure Debt, Assignment of
Leases and Rents and Security Agreement given by the Borrower to or for the
benefit of the Lender to secure the obligations of the Borrower under the
Loan Documents. With respect to each Mortgaged Property owned by the
Borrower, the Security Instrument shall be substantially in the form
published by Fannie Mae for use in the state in which the Mortgaged
Property is located. The amount secured by the Security Instrument shall be
equal to the Commitment in effect from time to time.




     “Senior Management” means (i) the Chief Executive Officer, Chairman of
the Board, President, Chief Financial Officer and Chief Operating Officer
of UDRT, and (ii) any other individuals with responsibility for any of the
functions typically performed in a corporation by the officers described in
clause (i).




     “SMSA” means a “standard metropolitan statistical area,“ as defined
from time to time by the United States Office of Management and Budget.




     “Standby Fee” means, for any month, an amount equal to the product
obtained by multiplying: (i) 1/12, by (ii) 12.5 basis points, by (iii) the
Unused Capacity for such month.




     “Subsidiary” means, as to any Person, any corporation, partnership,
limited liability company or other entity of which securities or other
ownership interest having an ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at
the time directly or indirectly owned by such Person. Unless otherwise
provided, references to a “Subsidiary” or “Subsidiaries” shall mean a
Subsidiary or Subsidiaries of the Borrower.




     “Surveys” means the as-built surveys of the Mortgaged Properties
prepared in accordance with the requirements of Section 113 of the DUS
Guide, or otherwise approved by the Lender.




     “Taxes” means all taxes, assessments, vault rentals and other charges,
if any, general, special or otherwise, including all assessments for
schools, public betterments and general or local improvements, which are
levied, assessed or imposed by any public authority or quasi-public
authority, and which, if not paid, will become a lien, on the Mortgaged
Properties.




     “Term of this Agreement” shall be determined as provided in Section
23.10 to this Agreement.




     “Termination Date” means, at any time during which Base Facility
Advances are Outstanding, the latest maturity date for any Base Facility
Advance Outstanding, and, at any



-16-









 






      time during which Base Facility Advances are not Outstanding, the Revolving
Facility Termination Date.




     “Three-Month LIBOR” means the London interbank offered rate for
three-month U.S. dollar deposits, as such rate is reported in The Wall
Street Journal. In the event that a rate is not published for the
Three-Month LIBOR, then the nearest equivalent duration London interbank
offered rate for U.S. Dollar deposits shall be selected at Lender’s
reasonable discretion. If the publication of Three-Month LIBOR is
discontinued, Lender shall determine such rate from another source
reasonably selected by Lender which reasonably correlates (as to rate and
volatility) historically to Three-Month LIBOR.




     “Tie-In Endorsement” means an endorsement to a Title Insurance Policy
which contains substantially the same coverages, and is subject to
substantially the same or fewer exceptions (or such other exceptions as the
Lender may approve), as the form attached as Exhibit J to this Agreement.




     “Title Company” means Fidelity National Title Insurance Corporation.




     “Title Insurance Policies” means the mortgagee’s policies of title
insurance issued by the Title Company from time to time relating to each of
the Security Instruments, conforming to the requirements of Section 111 of
the DUS Guide, together with such endorsements, coinsurance, reinsurance
and direct access agreements with respect to such policies as the Lender
may, from time to time, consider necessary or appropriate, whether or not
required by the DUS Guide, including Revolving Credit Endorsements, if
available, and Tie-In Endorsements, if available, and with a limit of
liability under the policy (subject to the limitations contained in
Sections 6(a)(i) and 6(a)(iii) of the Stipulations and Conditions of the
policy) equal to the Commitment.




     “Trailing 12 Month Period” means, for any specified date, the 12 month
period ending with the last day of the most recent Calendar Quarter for
which financial statements have been delivered by the Borrower to the
Lender pursuant to Sections 13.04(c) and (d).




     “Transfer” means a sale, assignment, lease, pledge, transfer or other
disposition (whether voluntary or by operation of law) of, or the granting
or creating of a lien, encumbrance or security interest in, any estate,
rights, title or interest in a Mortgaged Property, or any portion thereof.
“Transfer” does not include (i) a conveyance of the Mortgaged Property at a
judicial or non-judicial foreclosure sale under any Security Instrument or
(ii) the Mortgaged Property becoming part of a bankruptcy estate by
operation of law under the United States Bankruptcy Code.




     “Unused Capacity” means, for any month, the sum of the daily average
during such month of the undrawn amount of the Commitment available under
this Agreement, without regard to any unclosed Requests or to the fact that
a Request must satisfy conditions precedent.




     “Valuation” means, for any specified date, with respect to a
Multifamily Residential Property, (a) if an Appraisal of the Multifamily
Residential Property was more recently obtained than a Cap Rate for the
Multifamily Residential Property, the Appraised Value of



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such Multifamily Residential Property, or (b) if a Cap Rate for the
Multifamily Residential Property was more recently obtained than an
Appraisal of the Multifamily Residential Property, the value derived by
dividing—




	 	(i)	 	the Net Operating Income of such Multifamily Residential Property
for the Trailing 12 Month Period, by
	 
	 	(ii)	 	the most recent Cap Rate determined by the Lender.






Notwithstanding the foregoing, any Valuation for a Multifamily Residential
Property calculated for a date occurring before the first anniversary of
the date on which the Multifamily Residential Property becomes a part of
the Collateral Pool shall equal the Appraised Value of such Multifamily
Residential Property, unless the Lender determines that changed market or
property conditions warrant that the value be determined as set forth in
the preceding sentence. Any special risk factors taken into account in
connection with the Initial Valuation of a Multifamily Residential Property
shall apply to any subsequent Valuation of such Multifamily Residential
Property unless Lender shall determine that such special risk factor no
longer applies to such Multifamily Residential Property. If the Borrower
does not accept Lender’s Valuation, the Borrower may require that the
Lender obtain an additional Appraisal, if an Appraisal was the basis of the
Valuation, or two Appraisals, if a Cap Rate was the basis of the Valuation.
If the two appraisers do not agree on the valuation of the Mortgaged
Property, the Lender shall appoint a third appraiser. If a third appraiser
is appointed, such appraiser shall, within 30 days after appointment,
decide which one of the valuations determined by the other two appraisers
is closer to the valuation of the Mortgaged Property and the valuation so
selected by the third appraiser shall be binding on the parties as the
Valuation. The Borrower shall pay all of the Lender’s costs of obtaining
any Appraisal or engaging any appraiser pursuant to this Section.




     “Voting Equity Capital” means Securities or partnership interests of
any class or classes, the holders of which are ordinarily, in the absence
of contingencies, entitled to elect a majority of the board of directors
(or Persons performing similar functions).



ARTICLE II

THE REVOLVING FACILITY COMMITMENT



SECTION 2.01 Revolving Facility Commitment. Subject to the terms, conditions and
limitations of this Agreement, the Lender agrees to make Revolving Advances to
the Borrower from time to time during the Revolving Facility Availability
Period. The aggregate unpaid principal balance of the Revolving Advances
Outstanding at any time shall not exceed the Revolving Facility Commitment.
Subject to the terms, conditions and limitations of this Agreement, the Borrower
may re-borrow any amounts under the Revolving Facility which it has previously
borrowed and repaid under the Revolving Facility. The Borrower shall be entitled
to Revolving Advances based on increased Valuations of the Mortgaged Properties.



SECTION 2.02 Requests for Revolving Advances. The Borrower shall request a
Revolving Advance by giving the Lender an Initial Advance Request in accordance
with Section 5.01 or a Future Advance Request in accordance with Section 5.02,
as applicable.





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SECTION 2.03 Maturity Date of Revolving Advances. Regardless of the date on
which a Revolving Advance is made, the maturity date of each Revolving Advance
shall be a date selected by the Borrower in its Request for the Revolving
Advance, which date shall be the first day of a calendar month occurring:





     (a) no earlier than the date which completes one full month after the
Closing Date for the Revolving Advance; and




     (b) no later than the date which completes nine full months after the
Closing Date for the Revolving Advance.


For these purposes, a year shall be deemed to consist of 12 30-day months. For
example, the date which completes three full months after September 15 shall be
December 15; and the date which completes three full months after November 30
shall be February 28 or February 29 in 2000 and any leap year thereafter.



SECTION 2.04  Interest on Revolving Facility Advances.




     (a) Discount. Each Revolving Advance shall be a discount loan. The
original stated principal amount of a Revolving Advance shall be the sum of the
Price of the Revolving Advance and the Discount of the Revolving Advance. The
Price and Discount of each Revolving Advance shall be determined in accordance
with the procedures set out in Section 4.01. The proceeds of the Revolving
Advance made available by the Lender to the Borrower will equal the Price of the
Revolving Advance. The entire unpaid principal of each Revolving Advance shall
be due and payable by the Borrower to the Lender on the maturity date of the
Revolving Advance. However, if the Borrower has requested that the maturing
Revolving Advance (in whole or in part) be renewed with a new Revolving Advance
or converted to a Base Facility Advance, to take effect on the maturity date of
the maturing Revolving Advance, then the amount the Borrower is required to pay
on account of the maturing Revolving Advance will be reduced by, as the case
may, that amount of the Price of the new Revolving Advance allocable to the
principal of the maturing Revolving Advance being renewed, or that amount of the
net proceeds of the MBS related to the Base Facility Advance then converted from
the maturing Revolving Advance.



     (b) Partial Month Interest. Notwithstanding anything to the contrary
in this Section, if a Revolving Advance is not made on the first day of a
calendar month, and the MBS Issue Date for the MBS backed by the Revolving
Advance is the first day of the month following the month in which the Revolving
Advance is made, the Borrower shall pay interest on the original stated
principal amount of the Revolving Advance for the partial month period
commencing on the Closing Date for the Revolving Advance and ending on the last
day of the calendar month in which the Closing Date occurs, at a rate per annum
equal to the greater of (i) the Coupon Rate for the Revolving Advance as
determined in accordance with Section 2.05(b) and (ii) a rate reasonably
determined by the Lender, based on the Lender’s cost of funds and approved in
advance, in writing, by the Borrower, pursuant to the procedures mutually agreed
upon by the Borrower and the Lender.



     (c) Revolving Facility Fee. In addition to paying the Discount and
the partial month interest, if any, the Borrower shall pay monthly installments
of the Revolving Facility Fee to the Lender on account of each Revolving Advance
over the whole number of calendar months the



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MBS backed by the Revolving Advance is to run from the MBS Issue Date to the
maturity date of the MBS. The Revolving Facility Fee shall be payable in
advance, in accordance with the terms of the Revolving Facility Note. The first
installment shall be payable on or prior to the Closing Date for the Revolving
Advance and shall apply to the first full calendar month of the MBS backed by
the Revolving Advance. Subsequent installments shall be payable on the first day
of each calendar month, commencing on the first day of the second full calendar
month of such MBS, until the maturity of such MBS. Each installment of the
Revolving Facility Fee shall be in an amount equal to the product of multiplying
(i) the Revolving Facility Fee, by (ii) the amount of the Revolving Advance, by
(iii) 1/12.


SECTION 2.05 Coupon Rates for Revolving Advances. The Coupon Rate for a
Revolving Advance shall be a rate, per annum, as follows:




     (a) The Coupon Rate for a Revolving Advance shall equal the sum of
(i) an interest rate as determined by the Lender (rounded to three places)
payable for the Fannie Mae MBS pursuant to the MBS Commitment backed by the
Revolving Advance (“MBS Imputed Interest Rate“) and (ii) the Revolving Facility
Fee.



     (b) Notwithstanding anything to the contrary in this Section, if a
Revolving Advance is not made on the first day of a calendar month, and the MBS
Issue Date for the MBS backed by the Revolving Advance is the first day of the
month following the month in which the Revolving Advance is made, the Coupon
Rate for such Revolving Advance for such period shall be the greater of (i) the
rate for the Revolving Advance determined in accordance with subsection (a) of
this Section and (ii) a rate determined by the Lender, based on the Lender’s
cost of funds, and approved in advance, in writing, by the Borrower, pursuant to
procedures mutually agreed upon by the Borrower and the Lender.


SECTION 2.06 Revolving Facility Note. The obligation of the Borrower to repay
the Revolving Advances will be evidenced by the Revolving Facility Note. The
Revolving Facility Note shall be payable to the order of the Lender and shall be
made in the aggregate amount of the Revolving Facility Commitment.



SECTION 2.07 Extension of Revolving Facility Termination Date. The Borrower
shall have the right to extend the Revolving Facility Termination Date for one
(1) five (5) year period upon satisfaction of each of the following conditions:




     (a) The Borrower provides written notice to the Lender not less than
thirty (30) nor more than ninety (90) days prior to the then effective Revolving
Facility Termination Date requesting that the Revolving Facility Termination
Date be extended.



     (b) No Event of Default or Potential Event of Default exists on
either the date the notice required by paragraph (a) of this Section is given or
on the then effective Revolving Facility Termination Date.



     (c) All of the representations and warranties of the Borrower set
forth in Article XII of this Agreement and the Other Loan Documents are true and
correct in all material respects on the date the notice required by paragraph
(a) of this Section is given and on the then effective Revolving Facility
Termination Date.



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     (d) The relevant Borrower is in compliance with all of the covenants
set forth in Article XIII, Article XIV and Article XV on the date the notice
required by paragraph (a) of this Section is given and on the then effective
Revolving Facility Termination Date.


Upon receipt of the notice required in paragraph (a) of this Section and upon
compliance with the other conditions set forth above, the Revolving Facility
Termination Date shall be extended for five (5) years on the terms and
conditions set forth in this Agreement and the Other Loan Documents, provided
that the maturity and pricing applicable to the Revolving Facility during the
period after the then effective Revolving Facility Termination Date shall be
acceptable to Lender in its discretion.




ARTICLE III

THE BASE FACILITY COMMITMENT



SECTION 3.01 Base Facility Commitment. Subject to the terms, conditions and
limitations set forth in this Article, the Lender agrees to make Base Facility
Advances to the Borrower from time to time during the Base Facility Availability
Period. The aggregate original principal of the Base Facility Advances shall not
exceed the Base Facility Commitment. The borrowing of a Base Facility Advance
shall permanently reduce the Base Facility Commitment by the original principal
amount of the Base Facility Advance. The Borrower may not re-borrow any part of
the Base Facility Advance which it has previously borrowed and repaid. The
Borrower shall be entitled to Base Facility Advances based on increased
Valuations of the Mortgaged Properties.



SECTION 3.02 Requests for Base Facility Advances. The Borrower shall request a
Base Facility Advance by giving the Lender an Initial Advance Request in
accordance with Section 5.01 or a Future Advance Request in accordance with
Section 5.02, as applicable.



SECTION 3.03 Maturity Date of Base Facility Advances. The maturity date of each
Base Facility Advance shall be the maturity date selected by the Borrower at the
time of the making of each such Base Facility Advance, provided that such
maturity date shall not be earlier than the 5th anniversary of such Base
Facility Advance nor later than the 15/th/ anniversary of the Initial Closing
Date.



SECTION 3.04  Interest on Base Facility Advances.




     (a) Advances. Each Base Facility Advance shall bear interest at a
rate, per annum, equal to the sum of (i) the MBS Pass-Through Rate determined
for such Base Facility Advance and (ii) the Base Facility Fee.



     (b) Partial Month Interest. Notwithstanding anything to the contrary
in this Section, if a Base Facility Advance is not made on the first day of a
calendar month, and the MBS Issue Date for the MBS backed by the Base Facility
Advance is the first day of the month following the month in which the Base
Facility Advance is made, the Borrower shall pay interest on the original stated
principal amount of the Base Facility Advance for the partial month period
commencing on the Closing Date for the Base Facility Advance and ending on the
last day of the calendar month in which the Closing Date occurs at a rate, per
annum, equal to the greater of (i) the interest rate for the Base Facility
Advance described in the first sentence of this Section and (ii) a rate
reasonably determined by the Lender, based on the Lender’s cost of funds, and
approved in



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advance, in writing, by the Borrower, pursuant to procedures mutually agreed
upon by the Borrower and the Lender.



SECTION 3.05 Coupon Rates for Base Facility Advances. The Coupon Rate for a Base
Facility Advance shall be the rate of interest applicable to such Base Facility
Advance pursuant to Section 3.04.



SECTION 3.06 Base Facility Note. The obligation of the Borrower to repay a Base
Facility Advance will be evidenced by a Base Facility Note. The Base Facility
Notes shall be payable to the order of the Lender and shall be made in the
original principal amount of each Base Facility Advance.



SECTION 3.07 Conversion of Commitment from Revolving Facility Commitment to Base
Facility Commitment. The Borrower shall have the right, from time to time during
the Base Facility Availability Period, to convert all or a portion of a
Revolving Facility Commitment to the Base Facility Commitment, in which event
the Revolving Facility Commitment shall be reduced by, and the Base Facility
Commitment shall be increased by, the amount of the conversion.




     (a) Request. In order to convert all or a portion of the Revolving
Facility Commitment to the Base Facility Commitment, the Borrower shall deliver
a written request for a conversion (“Conversion Request”) to the Lender, in the
form attached as Exhibit K to this Agreement. Each Conversion Request shall be
accompanied by a designation of the amount of the conversion and a designation
of any Revolving Advances Outstanding which will be prepaid on or before the
Closing Date for the conversion as required by Section 3.08(c).



     (b) Closing. If none of the limitations contained in Section 3.08 is
violated, and all conditions contained in Section 3.09 are satisfied, the Lender
shall permit the requested conversion, at a closing to be held at offices
designated by the Lender on a Closing Date selected by the Lender, and occurring
within 30 Business Days after the Lender’s receipt of the Conversion Request (or
on such other date to which the Borrower and the Lender may agree), by executing
and delivering, all at the sole cost and expense of the Borrower, an amendment
to this Agreement, in the form attached as Exhibit L to this Agreement, together
with an amendment to each Security Document and other applicable Loan Documents,
in form and substance satisfactory to the Lender, reflecting the change in the
Base Facility Commitment and the Revolving Facility Commitment. The documents
and instruments referred to in the preceding sentence are referred to in this
Article as the “Conversion Documents.”


SECTION 3.08 Limitations on Right to Convert. The right of the Borrower to
convert all or a portion of the Revolving Facility Commitment to the Base
Facility Commitment is subject to the following limitations:




     (a) Closing Date. The Closing Date shall occur during the Base Facility
Availability Period.



     (b) Minimum Request. Each Request for a conversion shall be in the minimum
amount of $10,000,000.



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     (c) Obligation to Prepay Revolving Advances. If, after the conversion, the
aggregate unpaid principal balance of all Revolving Advances Outstanding will
exceed the Revolving Facility Commitment, the Borrower shall be obligated to
prepay, as a condition precedent to the conversion, an amount of Revolving
Advances Outstanding which is at least equal to the amount of the excess.


SECTION 3.09 Conditions Precedent to Conversion. The conversion of all or a
portion of the Revolving Facility Commitment to the Base Facility Commitment is
subject to the satisfaction of the following conditions precedent on or before
the Closing Date:




     (a) After giving effect to the requested conversion, the Coverage and
LTV Tests will be satisfied;



     (b) Prepayment by the Borrower in full of any Revolving Advances
Outstanding which the Borrower has designated for payment, together with any
associated prepayment premiums and other amounts due with respect to the
prepayment of such Revolving Advances;



     (c) The receipt by the Lender of an endorsement to each Title
Insurance Policy, amending the effective date of the Title Insurance Policy to
the Closing Date and showing no additional exceptions to coverage other than the
exceptions shown on the Initial Closing Date and other exceptions approved by
the Lender;



     (d) Receipt by the Lender of one or more counterparts of each
Conversion Document, dated as of the Closing Date, signed by each of the parties
(other than the Lender) who is a party to such Conversion Document; and



     (e) The satisfaction of all applicable General Conditions set forth
in Article XI.


SECTION 3.10 Defeasance. If at any time the Borrower elects to convert all or a
portion of the Revolving Facility Commitment to a Base Facility Commitment
pursuant to Section 3.07 of this Agreement, or elects that any portion of any
expansion of the Commitment shall be a Base Facility Commitment, the Conversion
Request or the Credit Facility Expansion Request for the first Base Facility
Commitment shall select defeasance or yield maintenance with respect to
prepayments of Base Facility Advances. If defeasance is selected, this Section
3.10 shall apply. The election of the Borrower as to defeasance or yield
maintenance in the first Conversion Request or Credit Facility Expansion Request
relating to a Base Facility Commitment shall apply to all Base Facility Advances
during the term of this Agreement. Base Facility Advances are not prepayable at
any time, provided that, notwithstanding the foregoing, Borrower may prepay any
Base Facility Advance during the last one hundred eighty (180) days of the term
of such Base Facility Advance and provided that Base Facility Advances may be
defeased pursuant to the terms and conditions of this Section. This Section 3.10
shall not apply to Mortgaged Properties released from a Security Instrument in
connection with a substitution of Collateral pursuant to Section 7.04 of this
Agreement.





     (a) Conditions. Subject to Section 3.10(d), Borrower shall have the
right to obtain the release of Mortgaged Properties from the lien of the
related Security Instruments (and all collateral derived from such Mortgage
Properties, including assignment of leases, fixture filings and other
documents and instruments evidencing a lien or security interest in



-23-









 






Borrower’s assets [except the Substitute Collateral] shall be released)
upon the satisfaction of all of the following conditions:




     (1) Defeasance Notice. Borrower shall give Lender a notice (the
“Defeasance Notice”, in the manner specified in Section 3.10(g)(4), on
a form provided by Lender, specifying a Business Day (the “Defeasance
Closing Date”) which Borrower desires to consummate the Defeasance.
The Defeasance Closing Date specified by Borrower may not be more than
45 calendar days, nor less than 30 calendar days, after the date on
which the Defeasance Notice is received by Lender. Borrower shall also
specify in the Defeasance Notice the name, address and telephone
number of Borrower for notices pursuant to Section 3.10(g)(4). The
form Defeasance Notice provided by Lender specifies: (i) which
Mortgaged Properties Borrower proposes to be released; (ii) the name,
address and telephone number of Lender for notices pursuant to Section
3.10(g)(4); (iii) the account(s) to which payments to Lender are to be
made; (iv) whether a Fannie Mae Investment Security will be offered
for use as the Substitute Collateral and, if not, that U.S. Treasury
Securities will be the Substitute Collateral; (v) whether the
Successor Borrower will be designated by Lender or Borrower; and (vi)
if a Fannie Mae Investment Security is offered for use as the
Substitute Collateral, the Defeasance Notice shall also include the
amount of the Defeasance Commitment Fee.




Any applicable Defeasance Commitment fee must be paid by Borrower and
received by Lender no later than the date and time when Lender
receives the Defeasance Notice from Borrower.




     (2) Confirmation. After Lender has confirmed that the Defeasance
is then permitted as provided in Section 3.10(d), and has confirmed
that the terms of the Defeasance Notice are acceptable to Lender,
Lender shall, with reasonable promptness, notify Borrower of such
confirmation by signing the Defeasance Notice, attaching the Annual
Yields for the Mortgage Payments beginning on the first day of the
second calendar month after the Defeasance Closing Date and ending on
the Stated Maturity Date (if a Fannie Mae Investment Security is
offered as Substitute Collateral) and transmitting the signed
Defeasance Notice to Borrower pursuant to Section 3.10(g)(4). If,
after Lender has notified Borrower of its confirmation in accordance
with the foregoing, Lender does not receive the Defeasance Commitment
Fee within five (5) Business Days after the Defeasance Notice
Effective Date, then Borrower’s right to obtain Defeasance pursuant to
that Defeasance Notice shall terminate.




     (3) Substitute Collateral. On or before the Defeasance Closing
Date, Borrower shall deliver to Lender a pledge and security
agreement, in form and substance satisfactory to Lender in its sole
discretion (the “Pledge Agreement”), creating a first priority
perfected security interest in favor of Lender in substitute
collateral constituting an Investment Security (the “Substitute
Collateral”). The Pledge Agreement shall provide Borrower’s
authorization and direction that all interest on, principal of and
other amounts payable with respect to the Substitute Collateral shall
be paid directly to Lender to be applied to Mortgage Payments due



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under the Base Facility Note subject to Defeasance. If the Substitute
Collateral is issued in a certificated form and Borrower has
possession of the certificate, the certificate shall be endorsed
(either on the certificate or on a separate writing attached thereto)
by Borrower as directed by Lender and delivered to Lender. If the
Substitute Collateral is issued in an uncertificated form, or in a
certificated form but Borrower does not have possession of the
certificate, Borrower shall execute and deliver to Lender all
documents and instruments required by Lender to create in Lender’s
favor a first priority perfected security interest in such Substitute
Collateral, including a securities account control agreement or any
other instrument or document required to perfect a security interest
in each Substitute Collateral.




     (4) Closing Documents. Borrower shall deliver to Lender on or
before the Defeasance Closing Date the documents described in Section
3.10(b).




     (5) Amounts Payable by Borrower. On or before the Defeasance
Closing Date, Borrower shall pay to Lender an amount equal to the sum
of:




	 	(A)	 	the Next Scheduled P&I Payment;
	 
	 	(B)	 	all other sums then due and payable under the Base
Facility Note subject to Defeasance, the Security
Instruments related to the Mortgaged Properties to be
released; and
	 
	 	(C)	 	all costs and expenses incurred by Lender or Servicer
in connection with the Defeasance, including the
reasonable fees and disbursements of Lender’s or
Servicer’s legal counsel.






     (6) Defeasance Deposit. If a Fannie Mae Investment Security will
be the Substitute Collateral, then, on or before 3:00 p.m.,
Washington, D.C. time, on the Defeasance Closing Date, Borrower shall
pay the Defeasance Deposit (reduced by the Defeasance Commitment Fee)
to Lender to be used by Lender to purchase the Fannie Mae Investment
Security as Borrower’s agent.




     (7) Covenants, Representations and Warranties. On the Defeasance
Closing Date, all of the covenants of the relevant Borrower set forth
in Articles XIII, XIV and XV of this Agreement and all of the
representations and warranties of the Borrower set forth in Article
XII of this Agreement are true and correct in all material respects.




     (8) Geographical Diversification. If, as a result of the
Defeasance, Lender determines that the geographical diversification of
the Collateral Pool is compromised (whether or not the Geographical
Diversification Requirement is met), Lender may require that Borrower
add or substitute Multifamily Residential Properties to the Collateral
Pool in a number and having a valuation required to restore the
geographical diversification of the Collateral Pool to a level at
least as diverse as before the Defeasance.



-25-









 






     (b) Closing Documents. The documents required to be delivered to
Lender on or before the Defeasance Closing Date pursuant to Section
3.10(a)(4) are:




     (1) an opinion of counsel for Borrower, in form and substance
satisfactory to Lender, to the effect that Lender has a valid and
perfected lien and security interest of first priority in the
Substitute Collateral and the principal and interest payable
thereunder;




     (2) an opinion of counsel for Borrower, in form and substance
satisfactory to Lender, that the Defeasance, including both Borrower’s
granting to Lender of a lien and security interest in the Substitute
Collateral and the assignment and assumption by Successor Borrower,
and each of them, when considered in combination and separately, are
not subject to avoidance under any applicable federal or state laws,
including Sections 547 and 548 of the U.S. Bankruptcy Code;




     (3) if a Fannie Mae Investment Security is not used as Substitute
Collateral, and unless waived by Lender, a certificate in form and
substance satisfactory to Lender, issued by an independent certified
public accountant, or financial institution, approved by Lender, to
the effect that the Substitute Collateral will generate the Scheduled
Defeasance Payments;




     (4) unless waived by Lender, an opinion of counsel for Borrower
in form and substance satisfactory to Lender, that the Defeasance will
not result in a “sale or exchange” of any Base Facility Note within
the meaning of Section 1001(c) of the Internal Revenue Code and the
temporary and final regulations promulgated thereunder;




     (5) such other opinions, certificates, documents or instruments
as Lender may reasonably request; and




     (6) three counterparts of the executed Assignment and Assumption
Agreement described in Section 3.10(e).




     (c) Release. Upon Borrower’s compliance with the requirements of
Sections 3.10(a)(1) through (7), the Mortgaged Properties shall be released
from the lien of the Security Instruments (and all collateral derived from
such Mortgaged Properties, including assignments of leases, fixture filings
and other documents and instruments evidencing a lien or security interest
in Borrower’s assets [except the Substitute Collateral] shall be released).
Lender shall, with reasonable promptness, execute and deliver to Borrower,
at Borrower’s cost and expense, any additional documents reasonably
requested by Borrower in order to evidence or confirm the release of
Lender’s liens and security interests described in the immediately
preceding sentence.




     (d) Defeasance Not Allowed. Borrower shall not have the right to
obtain Defeasance at any of the following times:




     (1) before the third anniversary of the date of the relevant Base
Facility Note;



-26-









 






     (2) after the expiration of the Defeasance Period; or




     (3) after Lender has accelerated the maturity of the unpaid
principal balance of, accrued interest on, and other amounts payable
under, any Note pursuant to Paragraph 6 of such Note.




     (e) Assignment and Assumption. Upon Borrower’s compliance with the
requirements of Section 3.10(a), Borrower shall assign all its obligations
and rights under the relevant Base Facility Note, together with the
Substitute Collateral, to a successor entity (the “Successor Borrower”)
designated by Lender or, if not so designated by Lender, designated by
Borrower and acceptable to Lender in its sole discretion. Borrower and
Successor Borrower shall execute and deliver to Lender an assignment and
assumption agreement on a form provided by Lender (the “Assignment and
Assumption Agreement”). The Assignment and Assumption Agreement shall
provide for (i) the transfer and assignment by Borrower to Successor
Borrower of the Substitute Collateral, subject to the lien and security
interest in favor of Lender, (ii) the assumption by Successor Borrower of
all liabilities and obligations of Borrower under the relevant Base
Facility Note, and (iii) the release by Lender of Borrower from all
liabilities and obligations under the relevant Base Facility Note. Lender
shall, at Borrower’s request and expense, execute and deliver releases,
reconveyances and security interest terminations with respect to the
released Mortgage Properties and all other collateral held by Lender
(except the Defeasance Deposit). The Assignment and Assumption Agreement
shall be executed by Lender with a counterpart to be returned by Lender to
Borrower and Successor Borrower thereafter; provided, however, in all
events that it shall not be a condition of Defeasance that the Assignment
and Assumption Agreement be executed by Lender, or any Successor Borrower
that is designated by Lender.




     (f) Agent. If the Defeasance Notice provides that Lender will make
available a Fannie Mae Investment Security for purchase by Borrower for use
as the Substitute Collateral, Borrower hereby authorizes Lender to use, and
appoints Lender as its agent and attorney-in-fact for the purpose of using,
the Defeasance Deposit (including any portion thereof that constitutes the
Defeasance Commitment Fee) to purchase a Fannie Mae Investment Security.




     (g) Administrative Provisions.




     (1) Fannie Mae Security Liquidated Damages. If Borrower timely
pays the Defeasance Commitment Fee, and Lender and Borrower timely
transmit a signed facsimile copy of the Defeasance Notice pursuant to
Section 3.10(a)(2), but Borrower fails to perform its other
obligations under Sections 3.10(a) and Section 3.10(e), Lender shall
have the right to retain the Defeasance Commitment Fee as liquidated
damages for Borrower’s default, as Lender’s sole and exclusive remedy,
and, except as provided in Section 3.10(g)(2), Borrower shall be
released from all further obligations under this Section 3.10.
Borrower acknowledges that, from and after the date on which Lender
has executed the Defeasance Notice under Section 3.10(a)(2) and
Borrower has delivered the Defeasance Commitment Fee, Lender will
incur financing costs in arranging and preparing for the purchase of
the Substitute



-27-









 






Collateral and in arranging and preparing for the release of the Mortgaged
Properties from the lien of the Security Instruments in reliance on the
executed Defeasance Notice. Borrower agrees that the Defeasance Commitment
Fee represents a fair and reasonable estimate, taking into account all
circumstances existing on the date of this Agreement, of the damages Lender
will incur by reason of Borrower’s default.




     (2) Third Party Costs. In the event that the Defeasance is not
consummated on the Defeasance Closing Date for any reason, Borrower agrees
to reimburse Lender and Servicer for all third party costs and expenses
(other than financing costs covered by Section 3.10(g)(1) above), including
attorneys’ fees and expenses, incurred by Lender in reliance on the
executed Defeasance Notice, within 10 Business Days after Borrower receives
a written demand for payment, accompanied by a statement, in reasonable
detail, of Lender’s and Servicer’s third party costs and expenses.




     (3) Payments. All payments required to be made by Borrower to Lender
or Servicer pursuant to this Section 3.10 shall be made by wire transfer of
immediately available finds to the account(s) designated by Lender or
Servicer, as the case may be, in the Defeasance Notice.




     (4) Notice. The Defeasance Notice delivered pursuant to this Section
3.10(g)(4) shall be in writing and shall be sent by telecopier or facsimile
machine which automatically generates a transmission report that states the
date and time of the transmission, the length of the document transmitted
and the telephone number of the recipient’s telecopier or facsimile machine
(or shall be sent by any distribution media, whether currently existing or
hereafter developed, including electronic mail and internet distribution,
as approved by Lender). Any notice so sent addressed to the parties at
their respective addresses designated in the Defeasance Notice pursuant to
Section 3.10(a), shall be deemed to have been received on the date and time
indicated on the transmission report of recipient. To be effective,
Borrower must send the Defeasance Notice (as described above) so that
Lender receives the Defeasance Notice no earlier than 11:00 a.m. and no
later than 3:00 p.m. Washington, D.C. time on a Business Day.



     (h) Definitions. For purposes of this Section 3.10, the following terms
shall have the following meanings:




     (1) The term “Annual Yield” means the yield for the theoretical
zero coupon U.S. Treasury Security as calculated from the current
“on-the-run” U.S. Treasury yield curve with a term to maturity that
most closely matches the Applicable Defeasance Term for the Mortgage
Payment, as published by Fannie Mae on MORNET(R) (or in an alternative
electronic format) at 2:00 p.m. Washington, D.C. time on the Business
Day that Lender receives the Defeasance Notice in accordance with
Section 3.10(g)(4). If the publication of yields on MORNET(R) is
unavailable, Lender shall determine yields from another source
reasonably determined by Lender.



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     (2) The term “Applicable Defeasance Term” means, in the case of each
Mortgage Payment, the number of calendar months, based on a year containing
12 calendar months with 30 days each, in the period beginning on the first
day of the first calendar month after the Defeasance Closing Date to the
date on which such Mortgage Payment is due and payable.




     (3) The term “Defeasance” means the transaction in which all (but not
less than all) of the Mortgaged Properties are released from the lien of
the Security Instruments and Lender receives, as substitute collateral, a
valid and perfected lien and security interest of first priority in the
Substitute Collateral and the principal and interest payable thereunder.




     (4) The term “Defeasance Commitment Fee” means the amount specified in
the Defeasance Notice as Borrower’s good faith deposit to ensure
performance of its obligations under this Section, which shall equal two
percent (2%) of the aggregate unpaid principal balance of the Base Facility
Note subject to Defeasance as of the Defeasance Notice Effective Date, if
the Successor Borrower is designated by Borrower under Section 3.10(e), or
one percent (1%) of the aggregate unpaid principal balance of the Base
Facility Note subject to Defeasance as of the Defeasance Notice Effective
Date if the Successor Borrower is designated by Lender under Section
3.10(e). No Defeasance Commitment Fee will be applicable if U.S. Treasury
Securities are specified in the Defeasance Notice as the applicable
Investment Security.




     (5) The term “Defeasance Deposit” means an amount equal to the sum of
the present value of each Mortgage Payment that becomes due and payable
during the period beginning on the first day of the second calendar month
after the Defeasance Closing Date and ending on the Stated Maturity Date,
where the present value of each Mortgage Payment is determined using the
following formula:



the amount of the Mortgage Payment

(1 + (the Annual Yield/12))/n/





For this purpose, the last Mortgage Payment due and payable on the
Stated Maturity Date shall include the amounts that would constitute
the unpaid principal balance of the Base Facility Note subject to
Defeasance on the Stated Maturity Date if all prior Mortgage Payments
were paid on their due dates and “n” shall equal the Applicable
Defeasance Term.




     (6) The term “Defeasance Period” means the period beginning on the
earliest permitted date determined under Section 3.10(d)(l) and ending on
the 180th day before the Stated Maturity Date.




     (7) The term “Defeasance Notice Effective Date” means the date on
which Lender provides confirmation of the Defeasance Notice pursuant to
Section 3.10(a)(2).



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     (8) The term “Fannie Mae Investment Security” means
any bond, debenture, note, participation certificate or other
similar obligation issued by Fannie Mae in connection with the
Defeasance which provides for Scheduled Defeasance Payments
beginning in the second calendar month after the Defeasance
Closing Date.




     (9) The term “Investment Security” means:




     (A) If offered by Lender pursuant to the
Defeasance Notice, a Fannie Mae Investment Security
purchased in the manner described in Sections
3.10(a)(6) and 3.10(f), and




     (B) If no Fannie Mae Investment Security is
offered by Lender pursuant to the Defeasance Notice,
U.S. Treasury Securities.




     (10) The term “Mortgage Payment” means the amount of
each regularly scheduled monthly payment of principal and
interest due and payable under the Base Facility Note subject
to Defeasance during the period beginning on the first day of
the second calendar month after the Defeasance Closing Date
and ending on the Stated Maturity Date, and the amount that
would constitute the aggregate unpaid principal balance of the
Base Facility Note subject to Defeasance on the Stated
Maturity Date if all prior Mortgage Payments were paid on
their due dates.




     (11) The term “Next Scheduled P&I Payment” means an
amount equal to the monthly installment of principal and
interest due under the Base Facility Note subject to
Defeasance on the first day of the first calendar month after
the Defeasance Closing Date.




     (12) The term “Scheduled Defeasance Payments” means
payments prior and as close as possible to (but in no event
later than) the successive scheduled dates on which Mortgage
Payments are required to be paid under the Base Facility Note
subject to Defeasance and in amounts equal to or greater than
the scheduled Mortgage Payments due and payable on such dates
under the Base Facility Note subject to Defeasance.




     (13) The term “Stated Maturity Date” means the
Maturity Date specified in the Base Facility Note subject to
Defeasance determined without regard to Lender’s exercise of
any right of acceleration of the Base Facility Note subject to
Defeasance.




     (14) The term “U.S. Treasury Securities” means
direct, non-callable and non-redeemable obligations of the
United States of America which provided for Scheduled
Defeasance Payments beginning in the second calendar month
after the Defeasance Closing Date.



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ARTICLE IV

RATE SETTING FOR THE ADVANCES



SECTION 4.01 Rate Setting for an Advance. Rates for an Advance shall be set in
accordance with the following procedures:




          (a) Preliminary, Nonbinding Quote. At the Borrower’s request the
Lender shall quote to the Borrower an estimate of the MBS Pass-Through Rate
(for a proposed Base Facility Advance) or MBS Imputed Interest Rate (for a
proposed Revolving Advance) for a Fannie Mae MBS backed by a proposed Advance.
The Lender’s quote shall be based on (i) a solicitation of at least three (3)
bids from institutional investors selected by the Lender and (ii) the proposed
terms and amount of the Advance selected by the Borrower. The quote shall not be
binding upon the Lender.




          (b) Rate Setting. If the Borrower satisfies all of the conditions
to the Lender’s obligation to make the Advance in accordance with Article V,
then the Borrower may propose a MBS Pass-Through Rate (for a Base Facility
Advance) or MBS Imputed Interest Rate (for a Revolving Advance) by submitting to
the Lender by facsimile transmission a completed and executed document, in the
form attached as Exhibit M to this Agreement (“Rate Setting Form”), before
1:00 p.m. Washington, D.C. time on any Business Day (“Rate Setting Date”). The
Rate Setting Form contains various factual certifications required by the Lender
and specifies:





     (i) for a Revolving Advance, the amount, term, MBS Issue Date,
Revolving Facility Fee and Closing Date for the Advance; and




     (ii) for a Base Facility Advance, the amount, term, MBS Issue
Date, Base Facility Fee, Price (which will be in a range between
99-1/2 and 100-1/2), Yield Maintenance Period, if applicable, Yield
Rate Security, if applicable, Amortization Period and Closing Date for
the Advance.



          (c) Rate Confirmation. Within one Business Day after receipt
of the completed and executed Rate Setting Form, the Lender shall solicit bids
from institutional investors selected by the Lender based on the information in
the Rate Setting Form, shall obtain a commitment (“MBS Commitment”) for the
purchase of a Fannie Mae MBS having the bid terms described in the related Rate
Setting Form, and shall immediately deliver to the Borrower by facsimile
transmission a completed document, in the form attached as Exhibit N to this
Agreement (“Rate Confirmation Form”). The Rate Confirmation Form will confirm:





     (i) for a Revolving Advance, the amount, term, MBS Issue Date,
MBS Delivery Date, MBS Imputed Interest Rate, Revolving Facility Fee,
Coupon Rate, Discount, Price, and Closing Date for the Advance; and




     (ii) for a Base Facility Advance, the amount, term, MBS Issue
Date, MBS Delivery Date, MBS Pass-Through Rate, Base Facility Fee,
Coupon Rate, Price, Yield Maintenance Period, Specified U.S. Treasury
Security, Amortization Period and Closing Date for the Advance.



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SECTION 4.02 Advance Confirmation Instrument for Revolving Advances. On or
before the Closing Date for a Revolving Advance, the Borrower shall execute and
deliver to the Lender an instrument (“Advance Confirmation Instrument”), in the
form attached as Exhibit O to this Agreement, confirming the amount, term, MBS
Issue Date, MBS Delivery Date, MBS Imputed Interest Rate, Revolving Facility
Fee, Coupon Rate, Discount, Price and Closing Date for the Advance, and the
Borrower’s obligation to repay the Advance in accordance with the terms of the
Notes and this Agreement. Upon the funding of the Revolving Advance, the Lender
shall note the date of funding in the appropriate space at the foot of the
Advance Confirmation Instrument and deliver a copy of the completed Advance
Confirmation Instrument to the Borrower. The Lender’s failure to do so shall not
invalidate the Advance Confirmation Instrument or otherwise affect in any way
any obligation of the Borrower to repay Revolving Advances in accordance with
the Advance Confirmation Instrument, the Revolving Facility Note or the other
Loan Documents, but is merely meant to facilitate evidencing the date of funding
and to confirm that the Advance Confirmation Instrument is not effective until
the date of funding.



SECTION 4.03 Breakage and other Costs. In the event that the Lender obtains an
MBS Commitment and the Lender fails to fulfill the MBS Commitment because the
Advance is not made (for a reason other than the default of the Lender to make
the Advance or the failure of the purchaser of the MBS to purchase such MBS),
the Borrower shall pay all breakage and other costs, fees and damages incurred
by the Lender in connection with its failure to fulfill the MBS Commitment. The
Lender reserves the right to require that the Borrower post a deposit at the
time the MBS Commitment is obtained.




ARTICLE V

MAKING THE ADVANCES



SECTION 5.01 Initial Advance. The Borrower may make a request (“Initial Advance
Request”) for the Lender to make the Initial Advance. If all conditions
contained in this Section are satisfied on or before the Closing Date for the
Initial Advance, the Lender shall make the Initial Advance on the Initial
Closing Date or on another date selected by the Borrower and approved by the
Lender. The obligation of the Lender to make the Initial Advance is subject to
the following conditions precedent:




          (a) Receipt by the Lender of the Initial Advance Request;




          (b) [Intentionally Deleted]




          (c) The delivery to the Title Company, for filing and/or recording
in all applicable jurisdictions, of all applicable Loan Documents required by
the Lender, including duly executed and delivered original copies of the
Revolving Facility Note, a Base Facility Note, the Initial Security Instruments
covering the Initial Mortgaged Properties and UCC-1 Financing Statements
covering the portion of the Collateral comprised of personal property, and other
appropriate instruments, in form and substance satisfactory to the Lender and in
form proper for recordation, as may be necessary in the opinion of the Lender to
perfect the Liens created by the applicable Security Instruments and any other
Loan Documents creating a Lien in favor of the





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Lender, and the payment of all taxes, fees and other charges payable in
connection with such execution, delivery, recording and filing;




          (d) If the Advance is a Revolving Advance, the receipt by the
Lender of the first installment of Revolving Facility Fee for the Revolving
Advance and the entire Discount for the Revolving Advance payable by the
Borrower pursuant to Section 2.04;




          (e) The receipt by the Lender of the Initial Origination Fee
pursuant to Section 16.02(a), the Initial Due Diligence Fee pursuant to Section
16.03(a) to the extent calculated by Lender at such time (any portion of the
Initial Due Diligence Fee not paid by the Borrower on the Initial Closing Date
shall be paid promptly upon demand by Lender), all legal fees and expenses
payable pursuant to Section 16.04(a) and all legal fees and expenses payable in
connection with the Initial Advance pursuant to Section 16.04(b); and




          (f) The satisfaction of all applicable General Conditions set forth
in Article XI.



SECTION 5.02 Future Advances. In order to obtain a Future Advance, the Borrower
may from time to time deliver a written request for a Future Advance (“Future
Advance Request”) to the Lender, in the form attached as Exhibit P to this
Agreement. Each Future Advance Request shall be accompanied by (a) a designation
of the amount of the Future Advance requested, and (b) a designation of the
maturity date of the Advance. Each Future Advance Request shall be in the
minimum amount of $3,000,000. If all conditions contained in Section 5.03 are
satisfied, the Lender shall make the requested Future Advance, at a closing to
be held at offices designated by the Lender on a Closing Date selected by the
Lender, and occurring on a date selected by the Borrower, which date shall be
not more than three (3) Business Days, after the Lender’s receipt of the Future
Advance Request and the Borrower’s receipt of the Rate Confirmation Form (or on
such other date to which the Borrower and the Lender may agree). The Lender
reserves the right to require that the Borrower post a deposit at the time the
MBS Commitment is obtained as an additional condition to the Lender’s obligation
to make the Future Advance.



SECTION 5.03 Conditions Precedent to Future Advances. The obligation of the
Lender to make a requested Future Advance is subject to the following conditions
precedent:




          (a) The receipt by the Lender of a Future Advance Request;




          (b) The Lender has delivered the Rate Setting Form for the Future
Advance to the Borrower;




          (c) After giving effect to the requested Future Advance, the
Coverage and LTV Tests will be satisfied;




          (d) If the Advance is a Base Facility Advance, delivery of a Base
Facility Note, duly executed by the Borrower, in the amount of the Advance,
reflecting all of the terms of the Base Facility Advance;




          (e) If the Advance is a Revolving Advance, delivery of the Advance
Confirmation Instrument, duly executed by the Borrower;





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          (f) For any Title Insurance Policy not containing a Revolving Credit
Endorsement, the receipt by the Lender of an endorsement to the Title Insurance
Policy, amending the effective date of the Title Insurance Policy to the Closing
Date and showing no additional exceptions to coverage other than the exceptions
shown on the Initial Closing Date and other exceptions approved by the Lender;




          (g) If the Advance is a Revolving Advance, the receipt by the Lender
of the first installment of Revolving Facility Fee for the Revolving Advance and
the entire Discount for the Revolving Advance payable by the Borrower pursuant
to Section 2.04;




          (h) The receipt by the Lender of all legal fees and expenses payable
by the Borrower in connection with the Future Advance pursuant to Section
16.04(b); and




          (i) The satisfaction of all applicable General Conditions set forth
in Article XI.



SECTION 5.04 Determination of Allocable Facility Amount and Valuations.




          (a) Initial Determinations. On the Initial Closing Date, Lender shall
determine (i) the Allocable Facility Amount and Valuation for each Mortgaged
Property and (ii) the Aggregate Debt Service Coverage Ratio for the Trailing 12
Month Period and the Aggregate Loan to Value Ratio for the Trailing 12 Month
Period. The determinations made as of the Initial Closing Date shall remain
unchanged until the first anniversary of the Initial Closing Date.




          (b) Future Determinations. (i) Once each Calendar Quarter or, if the
Commitment consists only of a Base Facility Commitment, once each Calendar Year,
within twenty (20) Business Days after Borrower has delivered to Lender the
reports required in Section 13.04, Lender shall determine the Aggregate Debt
Service Coverage Ratio for the Trailing 12 Month Period and the Aggregate Loan
to Value Ratio for the Trailing 12 Month Period with the other covenants set
forth in the Loan Documents, and whether the Borrower is in compliance, (ii)
after the first anniversary of the Initial Closing Date, on an annual basis, and
if Lender reasonably decides that changed market or property conditions warrant,
Lender shall determine Allocable Facility Amounts and Valuations, and (iii)
Lender shall also redetermine Allocable Facility Amounts to take account of any
addition, release or substitution of Collateral or other event which invalidates
the outstanding determinations.




ARTICLE VI

ADDITIONS OF COLLATERAL



SECTION 6.01 Right to Add Collateral. Subject to the terms and conditions of
this Article, the Borrower shall have the right, from time to time during the
Term of this Agreement, to add Multifamily Residential Properties to the
Collateral Pool in accordance with the provisions of this Article.



SECTION 6.02 Procedure for Adding Collateral. The procedure for adding
Collateral set forth in this Section 6.02 shall apply to all additions of
Collateral in connection with this Agreement, including but not limited to
additions of Collateral in connection with substitutions of Collateral and
expansion of the Credit Facility.





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          (a) Request. The Borrower may deliver a written request (“Collateral
Addition Request”) to the Lender, in the form attached as Exhibit Q to this
Agreement, to add one or more Multifamily Residential Properties to the
Collateral Pool. Each Collateral Addition Request shall be accompanied by the
following:





          (i) The information relating to the proposed Additional
Mortgaged Property required by the form attached as Exhibit R to this
Agreement (“Collateral Addition Description Package”), as amended from time
to time to include information required under the DUS Guide; and




          (ii) The payment of all Additional Collateral Due Diligence Fees
pursuant to Section 16.03(b) to the extent calculated by Lender at such
time (any portion of any Additional Collateral Due Diligence Fee not paid
by Borrower with the Collateral Additional Request shall be paid promptly
upon demand by Lender).



          (b) Additional Information. The Borrower shall promptly deliver to
the Lender any additional information concerning the proposed Additional
Mortgaged Property that the Lender may from time to time reasonably request.




          (c) Underwriting. The Lender shall evaluate the proposed Additional
Mortgaged Property, and shall make underwriting determinations as to (A) the
Aggregate Debt Service Coverage Ratios for the Trailing 12 Month Period and the
Aggregate Loan to Value Ratio for the Trailing 12 Month Period applicable to the
Collateral Pool, and (B) the Debt Service Coverage Ratio for the Trailing 12
Month Period and the Loan to Value Ratio for the Trailing 12 Month Period
applicable to the proposed Additional Property on the basis of the lesser of (i)
the acquisition price of the proposed Additional Mortgaged Property or (ii) a
Valuation made with respect to the proposed Additional Mortgaged Property, and
otherwise in accordance with Fannie Mae’s DUS Underwriting Requirements. Within
30 days after receipt of (i) the Collateral Addition Request for the Additional
Mortgaged Property and (ii) all reports, certificates and documents set forth on
Exhibit S to this Agreement, including a zoning analysis undertaken in
accordance with Section 206 of the DUS Guide, the Lender shall notify the
Borrower whether or not it shall consent to the addition of the proposed
Additional Mortgaged Property to the Collateral Pool and, if it shall so
consent, shall set forth the Aggregate Debt Service Coverage Ratios for the
Trailing 12 Month Period and the Aggregate Loan to Value Ratio for the Trailing
12 Month Period which it estimates shall result from the addition of the
proposed Additional Mortgaged Property to the Collateral Pool. If the Lender
declines to consent to the addition of the proposed Additional Mortgaged
Property to the Collateral Pool, the Lender shall include, in its notice, a
brief statement of the reasons for doing so. Within five Business Days after
receipt of the Lender’s notice that it shall consent to the addition of the
proposed Additional Mortgaged Property to the Collateral Pool, the Borrower
shall notify the Lender whether or not it elects to cause the proposed
Additional Mortgaged Property to be added to the Collateral Pool. If the
Borrower fails to respond within the period of five Business Days, it shall be
conclusively deemed to have elected not to cause the proposed Additional
Mortgaged Property to be added to the Collateral Pool.




          (d) Closing. If, pursuant to subsection (c), the Lender consents to
the addition of the proposed Additional Mortgaged Property to the Collateral
Pool, the Borrower timely elects to cause the proposed Additional Mortgaged
Property to be added to the Collateral Pool and all





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conditions contained in Section 6.03 are satisfied, the Lender shall permit the
proposed Additional Mortgaged Property to be added to the Collateral Pool, at a
closing to be held at offices designated by the Lender on a Closing Date
selected by the Lender, and occurring within 30 Business Days after the Lender’s
receipt of the Borrower’s election (or on such other date to which the Borrower
and the Lender may agree), provided that in any Calendar Quarter, the Closing
Date for any addition of an Additional Mortgaged Property to the Collateral Pool
shall be on the same day as the Closing Date of any release or substitution
pursuant to Article VII of this Agreement and any increase in the Credit
Facility pursuant to Article VIII of this Agreement



SECTION 6.03 Conditions Precedent to Addition of an Additional Mortgaged
Property to the Collateral Pool. The addition of an Additional Mortgaged
Property to the Collateral Pool on the Closing Date applicable to the Additional
Mortgaged Property is subject to the satisfaction of the following conditions
precedent:




          (a) If the Additional Mortgaged Property is being added to the
Collateral Pool prior to the first anniversary of the Initial Closing Date, the
Coverage and LTV Tests will be satisfied;




          (b) If the Additional Mortgaged Property is being added to the
Collateral Pool after the first anniversary of the Initial Closing Date, the
proposed Additional Mortgaged Property has a Debt Service Coverage Ratio for the
Trailing 12 Month Period of not less than 130% and a Loan to Value Ratio for the
Trailing 12 Month Period of not more than 70% and immediately after giving
effect to the requested addition, the Coverage and LTV Tests will be satisfied,
and in the case of any substitution effected pursuant to Section 7.04 of this
Agreement, the Coverage and LTV Tests are not adversely affected after giving
effect to the proposed substitution;




          (c) If the Collateral Addition Fee is due, the receipt by the Lender
of the Collateral Addition Fee and all legal fees and expenses payable by the
Borrower in connection with the Collateral Addition pursuant to Section
16.04(b);




          (d) The delivery to the Title Company, with fully executed
instructions directing the Title Company to file and/or record in all applicable
jurisdictions, all applicable Collateral Addition Loan Documents required by the
Lender, including duly executed and delivered original copies of any Security
Instruments and UCC-1 Financing Statements covering the portion of the
Additional Mortgaged Property comprised of personal property, and other
appropriate documents, in form and substance satisfactory to the Lender and in
form proper for recordation, as may be necessary in the opinion of the Lender to
perfect the Lien created by the applicable additional Security Instrument, and
any other Collateral Addition Loan Document creating a Lien in favor of the
Lender, and the payment of all taxes, fees and other charges payable in
connection with such execution, delivery, recording and filing;




          (e) If required by the Lender, amendments to the Notes and the
Security Instruments, reflecting the addition of the Additional Mortgaged
Property to the Collateral Pool and, as to any Security Instrument so amended,
the receipt by the Lender of an endorsement to the Title Insurance Policy
insuring the Security Instrument, amending the effective date of the Title
Insurance Policy to the Closing Date and showing no additional exceptions to
coverage other than the exceptions shown on the Initial Closing Date and other
exceptions approved by the Lender;





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          (f) If the Title Insurance Policy for the Additional Mortgaged
Property contains a Tie-In Endorsement, an endorsement to each other Title
Insurance Policy containing a Tie-In Endorsement, adding a reference to the
Additional Mortgaged Property; and




          (g) The satisfaction of all applicable General Conditions set forth
in Article XI.




ARTICLE VII

RELEASES OF COLLATERAL



SECTION 7.01 Right to Obtain Releases of Collateral. Subject to the terms and
conditions of this Article, the Borrower shall have the right to obtain a
release of Collateral from the Collateral Pool in accordance with the provisions
of this Article.



SECTION 7.02 Procedure for Obtaining Releases of Collateral.




          (a) Request. In order to obtain a release of Collateral from the
Collateral Pool, the Borrower may deliver a written request for the release of
Collateral from the Collateral Pool (“Collateral Release Request”) to the
Lender, in the form attached as Exhibit T to this Agreement. The Collateral
Release Request shall not result in a termination of all or any part of the
Credit Facility. The Borrower may only terminate all or any part of the Credit
Facility by delivering a Revolving Facility Termination Request or Credit
Facility Termination Request pursuant to Articles IX or X. The Collateral
Release Request shall be accompanied by (and shall not be effective unless it is
accompanied by) the name, address and location of the Mortgaged Property to be
released from the Collateral Pool (“Collateral Release Property”).




          (b) Closing. If all conditions contained in Section 7.03 are
satisfied, the Lender shall cause the Collateral Release Property to be released
from the Collateral Pool, at a closing to be held at offices designated by the
Lender on a Closing Date selected by the Lender, and occurring within 30 days
after the Lender’s receipt of the Collateral Release Request (or on such other
date to which the Borrower and the Lender may agree, provided that in any
Calendar Quarter, the Closing Date for any release shall be on the same day as
the Closing Date of any addition of an Additional Mortgaged Property to the
Collateral Pool pursuant to Article VI of this Agreement or any increase in the
Credit Facility pursuant to Article VIII of this Agreement), by executing and
delivering, and causing all applicable parties to execute and deliver, all at
the sole cost and expense of the Borrower, instruments, in the form customarily
used by the Lender and reasonably satisfactory to the Title Company for releases
in the jurisdiction governing the perfection of the security interest being
released, releasing the applicable Security Instrument as a Lien on the
Collateral Release Property, and UCC-3 Termination Statements terminating the
UCC-1 Financing Statements perfecting a Lien on the portion of the Collateral
Release Property comprised of personal property and such other documents and
instruments as the Borrower may reasonably request evidencing the release of the
applicable Collateral from any lien securing the Obligations (including a
termination of any restriction on the use of any accounts relating to the
Collateral Release Property) and the release and return to the Borrower of any
and all escrowed amounts relating thereto. The instruments referred to in the
preceding sentence are referred to in this Article as the “Collateral Release
Documents.”





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          (c) Release Price. The “Release Price” for each Mortgaged Property
other than Mortgaged Properties released from a Security Instrument in
connection with a Substitution of Collateral pursuant to Section 7.04 of this
Agreement means the greater of (i) the Allocable Facility Amount for the
Mortgaged Property to be released and (ii) the amount, if any, of Advances
Outstanding which are required to be repaid by the Borrower to the Lender in
connection with the proposed release of the Mortgaged Property from the
Collateral Pool, so that, immediately after the release, the Coverage and LTV
Tests will be satisfied and neither the Aggregate Debt Service Coverage Ratios
for the Trailing 12 Month Period will be reduced nor the Aggregate Loan to Value
Ratio for the Trailing 12 Month Period will be increased as a result of such
release. In addition to the Release Price, the Borrower shall pay to the Lender
all associated prepayment premiums and other amounts due under the Notes and any
Advance Confirmation Instruments evidencing the Advances being repaid.




          (d) Application of Release Price. The Release Price shall be applied
against the Revolving Advances Outstanding until there are no further Revolving
Advances Outstanding, and thereafter shall be held by the Lender (or its
appointed collateral agent) as substituted Collateral (“Substituted Cash
Collateral”), in accordance with a security agreement and other documents in
form and substance acceptable to the Lender (or, at the Borrower’s option, may
be applied against the prepayment of Base Facility Advances, so long as the
prepayment is permitted under the Base Facility Note for the Base Facility
Advance). Any portion of the Release Price held as Substituted Cash Collateral
may be released if, immediately after giving effect to the release, each of the
conditions set forth in Section 7.03(a) below shall have been satisfied. If, on
the date on which the Borrower pays the Release Price, Revolving Advances are
Outstanding but are not then due and payable, the Lender shall hold the payments
as additional Collateral for the Credit Facility, until the next date on which
Revolving Advances are due and payable, at which time the Lender shall apply the
amounts held by it to the amounts of the Revolving Advances due and payable.



SECTION 7.03 Conditions Precedent to Release of Collateral Release Property from
the Collateral. The obligation of the Lender to release a Collateral Release
Property from the Collateral Pool by executing and delivering the Collateral
Release Documents on the Closing Date, are subject to the satisfaction of the
following conditions precedent on or before the Closing Date:




          (a) Immediately after giving effect to the requested release the
Coverage and LTV Tests will be satisfied, and in the case of any substitution
effected pursuant to Section 7.04 of this Agreement, the Coverage and LTV Tests
are not adversely affected after giving effect to the proposed substitution;




          (b) Receipt by the Lender of the Release Price;




          (c) Receipt by the Lender of all legal fees and expenses payable by
the Borrower in connection with the release pursuant to Section 16.04(b);




          (d) Receipt by the Lender on the Closing Date of one or more
counterparts of each Collateral Release Document, dated as of the Closing Date,
signed by each of the parties (other than the Lender) who is a party to such
Collateral Release Document;





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          (e) If required by the Lender, amendments to the Notes and the
Security Instruments, reflecting the release of the Collateral Release Property
from the Collateral Pool and, as to any Security Instrument so amended, the
receipt by the Lender of an endorsement to the Title Insurance Policy insuring
the Security Instrument, amending the effective date of the Title Insurance
Policy to the Closing Date and showing no additional exceptions to coverage
other than the exceptions shown on the Initial Closing Date and other exceptions
approved by the Lender;




          (f) If the Lender determines the Collateral Release Property to be
one phase of a project, and one or more other phases of the project are
Mortgaged Properties which will remain in the Collateral Pool (“Remaining
Mortgaged Properties”), the Lender’s determination that the Remaining Mortgaged
Properties can be operated separately from the Collateral Release Property and
any other phases of the project which are not Mortgaged Properties. In making
this determination, the Lender shall evaluate whether the Remaining Mortgaged
Properties comply with the terms of Sections 203 and 208 of the DUS Guide,
which, as of the date of this Agreement, require, among other things, that a
phase which constitutes collateral for a loan made in accordance with the terms
of the DUS Guide (i) have adequate ingress and egress to existing public
roadways, either by location of the phase on a dedicated, all-weather road or by
access to such a road by means of a satisfactory easement, (ii) have access
which is sufficiently attractive and direct from major thoroughfares to be
conducive to continued good marketing, (iii) have a location which is not (A)
inferior to other phases, (B) such that inadequate maintenance of other phases
would have a significant negative impact on the phase, and (C) such that the
phase is visible only after passing through the other phases of the project and
(iv) comply with such other issues as are dictated by prudent practice;




          (g) Receipt by the Lender of endorsements to the Tie-In
Endorsements of the Title Insurance Policies, if deemed necessary by the Lender,
to reflect the release;




          (h) Receipt by the Lender on the Closing Date of a writing, dated
as of the Closing Date, signed by the Borrower, in the form attached as Exhibit U to this Agreement, pursuant to which the Borrower confirms that its
obligations under the Loan Documents are not adversely affected by the release
of the Collateral Release Property from the Collateral;




          (i) The remaining Mortgaged Properties in the Collateral Pool shall
satisfy the then-existing Geographical Diversification Requirements;




          (j) The satisfaction of all applicable General Conditions set forth
in Article XI; and




          (k) Notwithstanding the other provisions of this Section 7.03, no
release of any of the Mortgaged Properties shall be made unless the Borrower has
provided title insurance to Lender in respect of each of the remaining Mortgage
Properties in the Collateral Pool in an amount equal to 150% of the Initial
Value of each such Mortgaged Property.



SECTION 7.04 Substitutions. Subject to the terms, conditions and limitations of
Articles VI and VII, the Borrower may simultaneously add a Multifamily
Residential Property to the Collateral Pool and release a Mortgaged Property
from the Collateral Pool, thereby effecting a substitution of





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Collateral, provided that Sections 7.02(c), 7.02(d) and 7.03(b) shall not apply
to a substitution of Collateral.




ARTICLE VIII

EXPANSION OF CREDIT FACILITY



SECTION 8.01 Right to Increase Commitment. Subject to the terms, conditions and
limitations of this Article, the Borrower shall have the right to increase the
Base Facility Commitment, the Revolving Facility Commitment, or both. The
Borrower’s right to increase the Commitment is subject to the following
limitations:




          (a) Commitment. After giving effect to the proposed increase, the
Commitment (without regard to the actual amount of Revolving Advances
Outstanding, but taking into account the aggregate original principal amount of
all Base Facility Advances made under this Agreement to the Closing Date) shall
not exceed $400,000,000.




          (b) Minimum Request. Each Request for an increase in the
Commitment (other than an increase in the Commitment pursuant to Section
8.01(b), which shall be in the minimum amount of $3,000,000) shall be in the
minimum amount of $10,000,000.




          (c) Terms and Conditions. The terms and conditions of this
Agreement shall apply to any increase in the Commitment.



SECTION 8.02 Procedure for Obtaining Increases in Commitment.




          (a) Request. In order to obtain an increase in the Commitment,
the Borrower shall deliver a written request for an increase (a “Credit Facility
Expansion Request”) to the Lender, in the form attached as Exhibit V to this
Agreement. Each Credit Facility Expansion Request shall be accompanied by the
following:





     (i) A designation of the amount of the proposed increase;




     (ii) A designation of the increase in the Base Facility
Credit Commitment and the Revolving Facility Credit Commitment;




     (iii) A request that the Lender inform the Borrower of any
change in the Geographical Diversification Requirements; and




     (iv) A request that the Lender inform the Borrower of the
Base Facility Fee and the Revolving Facility Fee to apply to Advances
drawn from such increase in the Commitment.



          (b) Closing. If all conditions contained in Section 8.03 are
satisfied, the Lender shall permit the requested increase in the Commitment, at
a closing to be held at offices designated by the Lender on a Closing Date
selected by the Lender, and occurring within fifteen (15) Business Days after
the Lender’s receipt of the Credit Facility Expansion Request (or on such other
date to which the Borrower and the Lender may agree), provided that in any
Calendar Quarter the Closing




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Date for addition of an Additional Mortgaged Property to the Collateral Pool
pursuant to Article VI of this Agreement and any increase of the Credit Facility
shall be on the same day as the Closing Date for any release or substitution
pursuant to Article VII of this Agreement.



SECTION 8.03 Conditions Precedent to Increase in Commitment. The right of the
Borrower to increase the Commitment is subject to the satisfaction of the
following conditions precedent on or before the Closing Date:




     (a) After giving effect to the requested increase the Coverage and LTV
Tests will be satisfied;



     (b) Payment by the Borrower of the Expansion Origination Fee in
accordance with Section 16.02(b) and all legal fees and expenses payable by the
Borrower in connection with the expansion of the Commitment pursuant to Section
16.04(b);



     (c) The receipt by the Lender of an endorsement to each Title Insurance
Policy, amending the effective date of the Title Insurance Policy to the Closing
Date, increasing the limits of liability to the Commitment, as increased under
this Article, showing no additional exceptions to coverage other than the
exceptions shown on the Initial Closing Date (or, if applicable, the last
Closing Date with respect to which the Title Insurance Policy was endorsed) and
other exceptions approved by the Lender, together with any reinsurance
agreements required by the Lender;



     (d) The receipt by the Lender of fully executed original copies of all
Credit Facility Expansion Loan Documents, each of which shall be in full force
and effect, and in form and substance satisfactory to the Lender in all
respects;



     (e) if determined necessary by the Lender, the Borrower’s agreement to
such geographical diversification requirements as the Lender may determine; and



     (f) The satisfaction of all applicable General Conditions set forth in
Article XI.



ARTICLE IX

COMPLETE OR PARTIAL TERMINATION OF FACILITIES



SECTION 9.01 Right to Complete or Partial Termination of Facilities. Subject to
the terms and conditions of this Article, the Borrower shall have the right to
permanently reduce the Revolving Facility Commitment and the Base Facility
Commitment in accordance with the provisions of this Article.



SECTION 9.02 Procedure for Complete or Partial Termination of Facilities.




     (a) Request. In order to permanently reduce the Revolving Facility
Commitment (other than in connection with a conversion of all or a portion of
the Revolving Loan Commitment to a Base Facility Commitment, which reduction
shall be automatic) or the Base Facility Commitment, the Borrower may deliver a
written request for the reduction (“Facility Termination Request”) to the
Lender, in the form attached as Exhibit W to this Agreement. A permanent
reduction of the Revolving Facility Commitment to $0 shall be referred to as a



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“Complete
Revolving Facility Termination.” A permanent reduction of the Base Facility
Commitment to $0 shall be referred to as a “Complete Base Facility Termination.”
The Facility Termination Request shall be accompanied by the following:




          (i) A designation of the proposed amount of the reduction in the
Commitment; and




          (ii) Unless there is a Complete Revolving Facility Termination or
a Complete Base Facility Termination, a designation by the Borrower of any
Revolving Advances which will be prepaid or Fixed Advances which will be
prepaid, as the case may be.


Any release of Collateral, whether or not made in connection with a Facility
Termination Request, must comply with all conditions to a release which are set
forth in Article VII.




          (b) Closing. If all conditions contained in Section 9.03 are
satisfied, the Lender shall permit the Revolving Facility Commitment or Base
Facility Commitment, as the case may be, to be reduced to the amount designated
by the Borrower, at a closing to be held at offices designated by the Lender on
a Closing Date selected by the Lender, within fifteen (15) Business Days after
the Lender’s receipt of the Facility Termination Request (or on such other date
to which the Borrower and the Lender may agree), by executing and delivering a
counterpart of an amendment to this Agreement, in the form attached as Exhibit X
to this Agreement, evidencing the reduction in the Commitment. The document
referred to in the preceding sentence is referred to in this Article as the
“Facility Termination Document.”



SECTION 9.03 Conditions Precedent to Complete or Partial Termination of
Facilities. The right of the Borrower to reduce the Commitments and the
obligation of the Lender to execute the Facility Termination Document, are
subject to the satisfaction of the following conditions precedent on or before
the Closing Date:




          (a) Payment by the Borrower in full of all of the Revolving Advances
Outstanding required to be paid in order that the aggregate unpaid principal
balance of all Revolving Advances Outstanding is not greater than the Revolving
Facility Commitment, including any associated prepayment premiums or other
amounts due under the Notes (but if the Borrower is not required to prepay all
of the Revolving Advances, the Borrower shall have the right to select which of
the Revolving Advances shall be repaid);




          (b) If applicable, payment by the Borrower of the Facility
Termination Fee;




          (c) Receipt by the Lender on the Closing Date of one or more
counterparts of the Facility Termination Document, dated as of the Closing Date,
signed by each of the parties (other than the Lender) who is a party to such
Facility Termination Document; and




          (d) The satisfaction of all applicable General Conditions set forth
in Article XI.





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ARTICLE X

TERMINATION OF CREDIT FACILITY



SECTION 10.01 Right to Terminate Credit Facility. Subject to the terms and
conditions of this Article, the Borrower shall have the right to terminate this
Agreement and the Credit Facility and receive a release of all of the Collateral
from the Collateral Pool in accordance with the provisions of this Article.



SECTION 10.02 Procedure for Terminating Credit Facility.




     (a) Request. In order to terminate this Agreement and the Credit
Facility, the Borrower shall deliver a written request for the termination
(“Credit Facility Termination Request”) to the Lender, in the form attached as
Exhibit Y to this Agreement.



     (b) Closing. If all conditions contained in Section 10.03 are
satisfied, this Agreement shall terminate, and the Lender shall cause all of the
Collateral to be released from the Collateral Pool, at a closing to be held at
offices designated by the Lender on a Closing Date selected by the Lender,
within 30 Business Days after the Lender’s receipt of the Credit Facility
Termination Request (or on such other date to which the Borrower and the Lender
may agree), by executing and delivering, and causing all applicable parties to
execute and deliver, all at the sole cost and expense of the Borrower, (i)
instruments, in the form customarily used by the Lender for releases in the
jurisdictions in which the Mortgaged Properties are located, releasing all of
the Security Instruments as a Lien on the Mortgaged Properties, (ii) UCC
Termination Statements terminating all of the UCC-1 Financing Statements
perfecting a Lien on the personal property located on the Mortgaged Properties,
in form customarily used in the jurisdiction governing the perfection of the
security interest being released, (iii) such other documents and instruments as
the Borrower may reasonably request evidencing the release of the Collateral
from any lien securing the Obligations (including a termination of any
restriction on the use of any accounts relating to the Collateral) and the
release and return to the Borrower of any and all escrowed amounts relating
thereto, (iv) instruments releasing the Borrower from its obligations under this
Agreement and any and all other Loan Documents, and (v) the Notes, each marked
paid and canceled. The instruments referred to in the preceding sentence are
referred to in this Article as the “Facility Termination Documents.”


SECTION 10.03 Conditions Precedent to Termination of Credit Facility. The right
of the Borrower to terminate this Agreement and the Credit Facility and to
receive a release of all of the Collateral from the Collateral Pool and the
Lender’s obligation to execute and deliver the Facility Termination Documents on
the Closing Date are subject to the following conditions precedent:




     (a) Payment by the Borrower in full of all of the Notes Outstanding
on the Closing Date, including any associated prepayment premiums or other
amounts due under the Notes and all other amounts owing by the Borrower to the
Lender under this Agreement;



     (b) If applicable, defeasance by the Borrower, in accordance with the
provisions of Section 3.10 of this Agreement, with respect to all Base Facility
Notes Outstanding on the Closing Date;



     (c) If applicable, payment of the Facility Termination Fee; and




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     (d) The satisfaction of all applicable General Conditions set forth
in Article XI.



ARTICLE XI

GENERAL CONDITIONS PRECEDENT TO ALL REQUESTS




     The obligation of the Lender to close the transaction requested in a
Request shall be subject to the following conditions precedent (“General
Conditions”) in addition to any other conditions precedent set forth in this
Agreement:


SECTION 11.01 Conditions Applicable to All Requests. Each of the following
conditions precedent shall apply to all Requests:




          (a) Payment of Expenses. The payment by the Borrower of the Lender’s
reasonable fees and expenses payable in accordance with this Agreement for which
the Lender has presented an invoice on or before the Closing Date for the
Request.




          (b) No Material Adverse Change. There has been no material adverse
change in the financial condition, business or prospects of the Borrower or in
the physical condition, operating performance or value of any of the Mortgaged
Properties since the Initial Closing Date (or, with respect to the conditions
precedent to the Initial Advance, from the condition, business or prospects
reflected in the financial statements, reports and other information obtained by
the Lender during its review of the Borrower and the Initial Mortgaged
Properties).




          (c) No Default. There shall exist no Event of Default or Potential
Event of Default on the Closing Date for the Request and, after giving effect to
the transaction requested in the Request, no Event of Default or Potential Event
of Default shall have occurred.




          (d) No Insolvency. The Borrower is not insolvent (within the meaning
of any applicable federal or state laws relating to bankruptcy or fraudulent
transfers) nor will it be rendered insolvent by the transactions contemplated by
the Loan Documents, including the making of a Future Advance, or, after giving
effect to such transactions, will be left with an unreasonably small capital
with which to engage in its business or undertakings, or will have intended to
incur, or believe that it has incurred, debts beyond its ability to pay such
debts as they mature or will have intended to hinder, delay or defraud any
existing or future creditor.




          (e) No Untrue Statements. The Loan Documents shall not contain any
untrue or misleading statement of a material fact and shall not fail to state a
material fact necessary in order to make the information contained therein not
misleading.




          (f) Representations and Warranties. All representations and
warranties made by the Borrower in the Loan Documents shall be true and correct
in all material respects on the Closing Date for the Request with the same force
and effect as if such representations and warranties had been made on and as of
the Closing Date for the Request.




          (g) No Condemnation or Casualty. There shall not be pending or
threatened any condemnation or other taking, whether direct or indirect, against
any Mortgaged Property and there shall not have occurred any casualty to any
improvements located on any Mortgaged Property.





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          (h) Delivery of Closing Documents. The receipt by the Lender of the
following, each dated as of the Closing Date for the Request, in form
and substance satisfactory to the Lender in all respects:





               (i) A Compliance Certificate;




               (ii) An Organizational Certificate; and




               (iii) Such other documents, instruments, approvals (and, if
requested by the Lender, certified duplicates of executed copies thereof)

and opinions as the Lender may request.



          (i) Covenants. The relevant Borrower is in full compliance with each
of the covenants set forth in Articles XIII, XIV and XV of this Agreement,

without giving effect to any notice and cure rights of the relevant Borrower.



SECTION 11.02 Delivery of Closing Documents Relating to Initial Advance Request,
Collateral Addition Request, Credit Facility Expansion Request or Future Advance
Request. With respect to the closing of the Initial Advance Request, a
Collateral Addition Request, a Credit Facility Expansion Request, or a Future
Advance Request, it shall be a condition precedent that the Lender receives each
of the following, each dated as of the Closing Date for the Request, in form and
substance satisfactory to the Lender in all respects:




          (a) Loan Documents. Fully executed original copies of each Loan
Document required to be executed in connection with the Request, duly executed
and delivered by the parties thereto (other than the Lender), each of which
shall be in full force and effect.




          (b) Opinion. Favorable opinions of counsel to the Borrower, as to the
due organization and qualification of the Borrower, the due authorization,
execution, delivery and enforceability of each Loan Document executed in
connection with the Request and such other matters as the Lender may reasonably
require.



SECTION 11.03 Delivery of Property Related Documents. With respect to each of
the Mortgaged Properties to be made part of the Collateral Pool on the Closing
Date for the Initial Advance Request or a Collateral Addition Request, it shall
be a condition precedent that the Lender receive each of the following, each
dated as of the Closing Date for the Initial Advance Request or Collateral
Addition Request, as the case may be, in form and substance satisfactory to the
Lender in all respects:




          (a) A favorable opinion of local counsel to the Borrower or the
Lender as to the enforceability of the Security Instrument, and any
other Loan Documents, executed in connection with the Request.




          (b) A commitment for the Title Insurance Policy applicable to the
Mortgaged Property and a pro forma Title Insurance Policy based on
the Commitment.




          (c) The Insurance Policy (or a certified copy of the Insurance
Policy) applicable to the Mortgaged Property.






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          (d) The Survey applicable to the Mortgaged Property.




          (e) Evidence satisfactory to the Lender of compliance of the
Mortgaged Property with property laws as required by
Sections 205 and 206 of Part III of the DUS Guide.




          (f) An Appraisal of the Mortgaged Property.




          (g) A Replacement Reserve Agreement, providing for the establishment
of a replacement reserve account, to be pledged to the Lender, in which the
owner shall (unless waived by the Lender) periodically deposit amounts for
replacements for improvements at the Mortgaged Property and as additional
security for the Borrower’s obligations under the Loan Documents.




          (h) A Completion/Repair and Security Agreement, on the standard form
required by the DUS Guide.




          (i) If no management agreement is in effect for a Mortgaged Property,
an Agreement Regarding Management Agreement or, if a management agreement is in
effect for a Mortgaged Property, an Assignment of Management Agreement, on the
standard form required by the DUS Guide.




          (j) An Assignment of Leases and Rents, if the Lender determines one
to be necessary or desirable, provided that the provisions of any such
assignment shall be substantively identical to those in the Security Instrument
covering the Collateral, with such modifications as may be necessitated by
applicable state or local law.




ARTICLE XII

REPRESENTATIONS AND WARRANTIES



SECTION 12.01 Representations and Warranties of the Borrower. The Borrower
hereby represents and warrants to the Lender as follows:




          (a) Due Organization; Qualification.





               (1) The Borrower is a duly formed and existing corporation. The
Borrower is qualified to transact business and is in good standing in each
other jurisdiction in which such qualification and/or standing is necessary
to the conduct of its business and where the failure to be so qualified
would adversely affect the validity of, the enforceability of, or the
ability of the Borrower to perform the Obligations under this Agreement and
the other Loan Documents. The Borrower is qualified to transact business
and is in good standing in each State in which it owns a Mortgaged
Property.




               (2) The Borrower’s principal place of business, principal office
and office where it keeps its books and records as to the Collateral
is located at its address set out in Section 23.08.




               (3) The Borrower has observed all customary formalities regarding
its corporate existence.



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          (b) Power and Authority. The Borrower has the requisite power and
authority (i) to own its properties and to carry on its business as now
conducted and as contemplated to be conducted in connection with the performance
of the Obligations hereunder and under the other Loan Documents and (ii) to
execute and deliver this Agreement and the other Loan Documents and to carry out
the transactions contemplated by this Agreement and the other Loan Documents.




          (c) Due Authorization. The execution, delivery and performance of
this Agreement and the other Loan Documents have been duly authorized by all
necessary action and proceedings by or on behalf of the Borrower, and no further
approvals or filings of any kind, including any approval of or filing with any
Governmental Authority, are required by or on behalf of the Borrower as a
condition to the valid execution, delivery and performance by the Borrower of
this Agreement or any of the other Loan Documents.




          (d) Valid and Binding Obligations. This Agreement and the other Loan
Documents have been duly authorized, executed and delivered by the Borrower and
constitute the legal, valid and binding obligations of the Borrower, enforceable
against the Borrower in accordance with their respective terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws or equitable principles affecting the
enforcement of creditors’ rights generally or by equitable principles or by the
exercise of discretion by any court.




          (e) Non contravention; No Liens. Neither the execution and delivery
of this Agreement and the other Loan Documents, nor the fulfillment of or
compliance with the terms and conditions of this Agreement and the
other Loan Documents nor the performance of the Obligations:





               (1) does or will conflict with or result in any breach or
violation of any Applicable Law enacted or issued by any Governmental
Authority or other agency having jurisdiction over the Borrower, any of the
Mortgaged Properties or any other portion of the Collateral or other assets
of the Borrower, or any judgment or order applicable to the Borrower or to
which the Borrower, any of the Mortgaged Properties or other assets of the
Borrower are subject;




               (2) does or will conflict with or result in any material breach
or violation of, or constitute a default under, any of the terms,
conditions or provisions of the Borrower’s Organizational Documents, any
indenture, existing agreement or other instrument to which the Borrower is
a party or to which the Borrower, any of the Mortgaged Properties or any
other portion of the Collateral or other assets of the Borrower are
subject;




               (3) does or will result in or require the creation of any Lien on
all or any portion of the Collateral or any of the Mortgaged
Properties, except for the Permitted Liens; or




               (4) does or will require the consent or approval of any creditor
of the Borrower, any Governmental Authority or any other Person
except such consents or approvals which have already been obtained.



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          (f) Pending Litigation or other Proceedings. There is no pending or,
to the best knowledge of the Borrower, threatened action, suit, proceeding or
investigation, at law or in equity, before any court, board, body or official of
any Governmental Authority or arbitrator against or affecting any Mortgaged
Property or any other portion of the Collateral or other assets of the Borrower,
which, if decided adversely to the Borrower, would have, or may reasonably be
expected to have, a Material Adverse Effect. The Borrower is not in default with
respect to any order of any Governmental Authority.




          (g) Solvency. The Borrower is not insolvent and will not be rendered
insolvent by the transactions contemplated by this Agreement or the other Loan
Documents and after giving effect to such transactions, the Borrower will not be
left with an unreasonably small amount of capital with which to engage in its
business or undertakings, nor will the Borrower have incurred, have intended to
incur, or believe that it has incurred, debts beyond its ability to pay such
debts as they mature. The Borrower did not receive less than a reasonably
equivalent value in exchange for incurrence of the Obligations. There (i) is no
contemplated, pending or, to the best of the Borrower’s knowledge, threatened
bankruptcy, reorganization, receivership, insolvency or like proceeding, whether
voluntary or involuntary, affecting the Borrower or any of the Mortgaged
Properties and (ii) has been no assertion or exercise of jurisdiction over the
Borrower or any of the Mortgaged Properties by any court empowered to exercise
bankruptcy powers.




          (h) No Contractual Defaultsv. There are no defaults by the Borrower
or, to the knowledge of the Borrower, by any other Person under any contract to
which the Borrower is a party relating to any Mortgaged Property, including any
management, rental, service, supply, security, maintenance or similar contract,
other than defaults which do not permit the non defaulting party to terminate
the contract and which do not have, and are not reasonably expected to have, a
Material Adverse Effect. Neither the Borrower nor, to the knowledge of the
Borrower, any other Person, has received notice or has any knowledge of any
existing circumstances in respect of which it could receive any notice of
default or breach in respect of any contracts affecting or concerning any
Mortgaged Property, which would have a Material Adverse Effect.




          (i) Compliance with the Loan Documents. The Borrower is in compliance
with all provisions of the Loan Documents to which it is a party or by which it
is bound. The representations and warranties made by the Borrower in the Loan
Documents are true, complete and correct as of the Closing Date and do not
contain any untrue statement of material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements made
therein, in light of the circumstances under which they were made, not
misleading.




          (j) ERISA. The Borrower is in compliance in all material respects
with all applicable provisions of ERISA and has not incurred any liability to
the PBGC on a Plan under Title IV of ERISA. None of the assets of the Borrower
constitute plan assets (within the meaning of Department of Labor Regulation (S)
2510.3 101) of any employee benefit plan subject to Title I of ERISA.




          (k) Financial Information. The financial projections relating to the
Borrower and delivered to the Lender on or prior to the date hereof, if any,
were prepared on the basis of assumptions believed by the Borrower, in good
faith at the time of preparation, to be reasonable and the Borrower is not aware
of any fact or information that would lead it to believe that such




- 48 -









 




assumptions are incorrect or misleading in any material respect; provided,
however, that no representation or warranty is made that any result set forth in
such financial projections shall be achieved. The financial statements of the
Borrower which have been furnished to the Lender are complete and accurate in
all material respects and present fairly the financial condition of the
Borrower, as of its date in accordance with GAAP, applied on a consistent basis,
and since the date of the most recent of such financial statements no event has
occurred which would have, or may reasonably be expected to have a Material
Adverse Effect, and there has not been any material transaction entered into by
the Borrower other than transactions in the ordinary course of business. The
Borrower has no material contingent obligations which are not otherwise
disclosed in its most recent financial statements.




          (l) Accuracy of Information. No information, statement or report
furnished in writing to the Lender by the Borrower in connection with this
Agreement or any other Loan Document or in connection with the consummation of
the transactions contemplated hereby and thereby contains any material
misstatement of fact or omits to state a material fact necessary to make the
statements contained therein, in light of the circumstances under which they
were made, not misleading; and the representations and warranties of the
Borrower and the statements, information and descriptions contained in the
Borrower’s closing certificates, as of the Closing Date, are true, correct and
complete in all material respects, do not contain any untrue statement or
misleading statement of a material fact, and do not omit to state a material
fact required to be stated therein or necessary to make the certifications,
representations, warranties, statements, information and descriptions contained
therein, in light of the circumstances under which they were made, not
misleading; and the estimates and the assumptions contained herein and in any
certificate of the Borrower delivered as of the Closing Date are reasonable and
based on the best information available to the Borrower.




          (m) Intentionally Omitted.




          (n) Governmental Approvals. No Governmental Approval not already
obtained or made is required for the execution and delivery of this Agreement or
any other Loan Document or the performance of the terms and provisions hereof or
thereof by the Borrower.




          (o) Governmental Orders. The Borrower is not presently under any
cease or desist order or other orders of a similar nature, temporary or
permanent, of any Governmental Authority which would have the effect of
preventing or hindering performance of its duties hereunder, nor are there any
proceedings presently in progress or to its knowledge contemplated which would,
if successful, lead to the issuance of any such order.




          (p) No Reliance. The Borrower acknowledges, represents and warrants
that it understands the nature and structure of the transactions contemplated by
this Agreement and the other Loan Documents, that it is familiar with the
provisions of all of the documents and instruments relating to such
transactions; that it understands the risks inherent in such transactions,
including the risk of loss of all or any of the Mortgaged Properties; and that
it has not relied on the Lender or Fannie Mae for any guidance or expertise in
analyzing the financial or other consequences of the transactions contemplated
by this Agreement or any other Loan Document or otherwise relied on the Lender
or Fannie Mae in any manner in connection with interpreting,







- 49 -









 







entering
into or otherwise in connection with this Agreement, any other Loan Document or any of the matters contemplated hereby or thereby.




               (q) Compliance with Applicable Law. The Borrower is in compliance
with Applicable Law, including all Governmental Approvals, if any, except for
such items of noncompliance that, singly or in the aggregate, have not had and
are not reasonably expected to cause, a Material Adverse Effect.



               (r) Contracts with Affiliates. Except as otherwise approved in
writing by the Lender, the Borrower has not entered into and is not a party to
any contract, lease or other agreement with any Affiliate of the Borrower for
the provision of any service, materials or supplies to any Mortgaged Property
(including any contract, lease or agreement for the provision of property
management services, cable television services or equipment, gas, electric or
other utilities, security services or equipment, laundry services or equipment
or telephone services or equipment).



               (s) Lines of Business. Not less than sixty percent (60%) of the
Consolidated Total Assets of each Borrower consist of Multifamily
Residential Properties.



               (t) Status as a Real Estate Investment Trust. UDRT is qualified,
and is taxed as, a real estate investment trust under Subchapter M of the
Internal Revenue Code, and is not engaged in any activities which would
jeopardize such qualification and tax treatment.


SECTION 12.02 Representations and Warranties of the Borrower. The Borrower
owning a Mortgaged Property hereby represents and warrants to the
Lender as follows with respect to each of the Mortgaged Properties owned by it:




               (a) Title. The relevant Borrower has good, valid, marketable and
indefeasible title to each Mortgaged Property (either in fee simple or as tenant
under a ground lease meeting all of the requirements of the DUS Guide), free and
clear of all Liens whatsoever except the Permitted Liens. Each Security
Instrument, if and when properly recorded in the appropriate records, together
with any Uniform Commercial Code financing statements required to be filed in
connection therewith, will create a valid, perfected first lien on the Mortgaged
Property intended to be encumbered thereby (including the Leases related to such
Mortgaged Property and the rents and all rights to collect rents under such
Leases), subject only to Permitted Liens. Except for any Permitted Liens, there
are no Liens or claims for work, labor or materials affecting any Mortgaged
Property which are or may be prior to, subordinate to, or of equal priority
with, the Liens created by the Loan Documents. The Permitted Liens do not have,
and may not reasonably be expected to have, a Material Adverse Effect.



               (b) Impositions. The Borrower has filed all property and similar
tax returns required to have been filed by it with respect to each Mortgaged
Property and has paid and discharged, or caused to be paid and discharged, all
installments for the payment of all Taxes due to date, and all other material
Impositions imposed against, affecting or relating to each Mortgaged Property
other than those which have not become due, together with any fine, penalty,
interest or cost for nonpayment pursuant to such returns or pursuant to any
assessment received by it. Except for any Tax, levy or other assessment or
charge resulting from a reassessment of the value of a Mortgaged Property in the
ordinary course of business, the Borrower has no knowledge of any new



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proposed Tax, levy or other governmental or private assessment or charge in
respect of any Mortgaged Property which has not been disclosed in writing to the
Lender.




               (c) Zoning. Each Mortgaged Property complies in all material
respects with all Applicable Laws affecting such Mortgaged Property. Without
limiting the foregoing, all material Permits, including certificates of
occupancy, have been issued and are in full force and effect. Neither the
Borrower nor, to the knowledge of the Borrower, any former owner of any
Mortgaged Property, has received any written notification or threat of any
actions or proceedings regarding the noncompliance or nonconformity of any
Mortgaged Property with any Applicable Laws or Permits, nor is the Borrower
otherwise aware of any such pending actions or proceedings.



               (d) Leases. The Borrower has delivered to the Lender a true and
correct copy of its form apartment lease for each Mortgaged Property (and, with
respect to leases executed prior to the date on which the Borrower first owned
the Mortgaged Property, the form apartment lease used for such leases), and each
Lease with respect to such Mortgaged Property is in the form thereof, with no
material modifications thereto, except as previously disclosed in writing to the
Lender. Except as set forth in a Rent Roll, no Lease for any unit in any
Mortgaged Property (i) is for a term in excess of one year, including any
renewal or extension period unless such renewal or extension period is subject
to termination by the Borrower upon not more than 30 days’ written notice, (ii)
provides for prepayment of more than one month’s rent, or (iii) was entered into
in other than the ordinary course of business.



               (e) Rent Roll. The Borrower has executed and delivered to the
Lender a Rent Roll for each Mortgaged Property, each dated as of and delivered
within 30 days prior to the Closing Date. Each Rent Roll sets forth each and
every unit subject to a Lease which is in full force and effect as of the date
of such Rent Roll. The information set forth on each Rent Roll is true, correct
and complete in all material respects as of its date and there has occurred no
material adverse change in the information shown on any Rent Roll from the date
of each such Rent Roll to the Closing Date. Except as disclosed in the Rent Roll
with respect to each Mortgaged Property or otherwise previously disclosed in
writing to the Lender, no Lease is in effect as of the date of the Rent Roll
with respect to such Mortgaged Property. Notwithstanding the foregoing, any
representation in this subsection (e) made with respect to a time period
occurring prior to the date on which the Borrower owned the Mortgaged Property
is made to the best of the Borrower’s knowledge.



               (f) Status of Landlord under Leases. Except for any assignment of
leases and rents which is a Permitted Lien or which is to be released in
connection with the consummation of the transactions contemplated by this
Agreement, the Borrower is the owner and holder of the landlord’s interest under
each of the Leases of units in each Mortgaged Property and there are no prior
outstanding assignments of any such Lease, or any portion of the rents,
additional rents, charges, issues or profits due and payable or to become due
and payable thereunder.



               (g) Enforceability of Leases. Each Lease constitutes the legal,
valid and binding obligation of the Borrower and, to the knowledge of the
Borrower, of each of the other parties thereto, enforceable in accordance with
its terms, subject only to bankruptcy, insolvency, reorganization or other
similar laws relating to creditors’ rights generally, and equitable principles,
and except as disclosed in writing to the Lender, no notice of any default by
the Borrower which



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remains uncured has been sent by any tenant under any such Lease, other than
defaults which do not have, and are not reasonably expected to have, a Material
Adverse Effect on the Mortgaged Property subject to the Lease.




               (h) No Lease Options. All premises demised to tenants under
Leases are occupied by such tenants as tenants only. No Lease contains any
option or right to purchase, right of first refusal or any other similar
provisions. No option or right to purchase, right of first refusal, purchase
contract or similar right exists with respect to any Mortgaged Property.



               (i) Insurance. The Borrower has delivered to the Lender true and
correct certified copies of all Insurance Policies currently in effect as of the
date of this Agreement with respect to the Mortgaged Property which it owns.
Each such Insurance Policy complies in all material respects with the
requirements set forth in the Loan Documents.



               (j) Tax Parcels. Each Mortgaged Property is on one or more
separate tax parcels, and each such parcel (or parcels) is (or are)
separate and apart from any other property.



               (k) Encroachments. Except as disclosed on the Survey with respect
to each Mortgaged Property, none of the improvements located on any Mortgaged
Property encroaches upon the property of any other Person or upon any easement
encumbering the Mortgaged Property, nor lies outside of the boundaries and
building restriction lines of such Mortgaged Property and no improvement located
on property adjoining such Mortgaged Property lies within the boundaries of or
in any way encroaches upon such Mortgaged Property.



               (l) Independent Unit. Except for Permitted Liens and as disclosed
on Exhibit AA to this Agreement, or as disclosed in a Title Insurance Policy or
Survey for the Mortgaged Property, each Mortgaged Property is an independent
unit which does not rely on any drainage, sewer, access, parking, structural or
other facilities located on any Property not included either in such Mortgaged
Property or on public or utility easements for the (i) fulfillment of any
zoning, building code or other requirement of any Governmental Authority that
has jurisdiction over such Mortgaged Property, (ii) structural support, or (iii)
the fulfillment of the requirements of any Lease or other agreement affecting
such Mortgaged Property. The Borrower, directly or indirectly, has the right to
use all amenities, easements, public or private utilities, parking, access
routes or other items necessary or currently used for the operation of each
Mortgaged Property. All public utilities are installed and operating at each
Mortgaged Property and all billed installation and connection charges have been
paid in full. Each Mortgaged Property is either (x) contiguous to or (y)
benefits from an irrevocable unsubordinated easement permitting access from such
Mortgaged Property to a physically open, dedicated public street, and has all
necessary permits for ingress and egress and is adequately serviced by public
water, sewer systems and utilities. No building or other improvement not located
on a Mortgaged Property relies on any part of the Mortgaged Property to fulfill
any zoning requirements, building code or other requirement of any Governmental
Authority that has jurisdiction over the Mortgaged Property, for structural
support or to furnish to such building or improvement any essential building
systems or utilities.



               (m) Condition of the Mortgaged Properties. Except as disclosed in
any third party report delivered to the Lender prior to the date on which the
Borrower’s Mortgaged Property is added to the Collateral Pool, or otherwise
disclosed in writing by the Borrower to the Lender



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prior to such date, each Mortgaged Property is in good condition, order and
repair, there exist no structural or other material defects in such Mortgaged
Property (whether patent or, to the best knowledge of the Borrower, latent or
otherwise) and the Borrower has not received notice from any insurance company
or bonding company of any defects or inadequacies in such Mortgaged Property, or
any part of it, which would adversely affect the insurability of such Mortgaged
Property or cause the imposition of extraordinary premiums or charges for
insurance or of any termination or threatened termination of any policy of
insurance or bond. No claims have been made against any contractor, architect or
other party with respect to the condition of any Mortgaged Property or the
existence of any structural or other material defect therein. No Mortgaged
Property has been materially damaged by casualty which has not been fully
repaired or for which insurance proceeds have not been received or are not
expected to be received except as previously disclosed in writing to the Lender.
There are no proceedings pending for partial or total condemnation of any
Mortgaged Property except as disclosed in writing to the Lender.



SECTION 12.03 Representations and Warranties of the Lender. The Lender hereby
represents and warrants to the Borrower as follows:




               (a) Due Organization. The Lender is a corporation duly organized,
validly existing and in good standing under the laws of Ohio.



               (b) Power and Authority. The Lender has the requisite power and
authority to execute and deliver this Agreement and to perform its
obligations under this Agreement.



               (c) Due Authorization. The execution and delivery by the Lender
of this Agreement, and the consummation by it of the transactions contemplated
thereby, and the performance by it of its obligations thereunder, have been duly
and validly authorized by all necessary action and proceedings by it or on its
behalf.



ARTICLE XIII

AFFIRMATIVE COVENANTS OF THE BORROWER



The
Borrower agrees and covenants with the Lender that, at all times during the Term of this Agreement:



SECTION 13.01 Compliance with Agreements; No Amendments. The Borrower shall
comply with all the terms and conditions of each Loan Document to
which it is a party or by which it is bound; provided, however, that the Borrower’s failure to
comply with such terms and conditions shall not be an Event of Default until the
expiration of the applicable notice and cure periods, if any, specified in the
applicable Loan Document.



SECTION 13.02 Maintenance of Existence. The Borrower shall maintain its
existence and continue to be a corporation, limited liability company or limited
partnership, as applicable, organized under the laws of the state of its
organization. The Borrower shall continue to be duly qualified to do business in
each jurisdiction in which such qualification is necessary to the conduct of its
business and where the failure to be so qualified would adversely affect the
validity of, the enforceability of, or the ability to perform, its obligations
under this Agreement or any other Loan Document.




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SECTION 13.03 Maintenance of REIT Status. During the Term of this Agreement,
UDRT shall qualify, and be taxed as, a real estate investment trust under
Subchapter M of the Internal Revenue Code, and will not be engaged in any
activities which would jeopardize such qualification and tax treatment.



SECTION 13.04 Financial Statements; Accountants’ Reports; Other Information. The
Borrower shall keep and maintain at all times complete and accurate books of
accounts and records in sufficient detail to correctly reflect (x) all of the
Borrower’s financial transactions and assets and (y) the results of the
operation of each Mortgaged Property and copies of all written contracts, Leases
and other instruments which affect each Mortgaged Property (including all bills,
invoices and contracts for electrical service, gas service, water and sewer
service, waste management service, telephone service and management services).
In addition, the Borrower shall furnish, or cause to be furnished, to the
Lender:




               (a) Annual Financial Statements. As soon as available, and in any
event within 90 days after the close of its fiscal year during the Term of this
Agreement, the audited balance sheet of UDRT and its Subsidiaries as of the end
of such fiscal year, the audited statement of income, UDRT’s equity and retained
earnings of the UDRT and its Subsidiaries for such fiscal year and the audited
statement of cash flows of UDRT and its Subsidiaries for such fiscal year, all
in reasonable detail and stating in comparative form the respective figures for
the corresponding date and period in the prior fiscal year, prepared in
accordance with GAAP, consistently applied, and accompanied by a certificate of
UDRT’s independent certified public accountants to the effect that such
financial statements have been prepared in accordance with GAAP, consistently
applied, and that such financial statements fairly present the results of its
operations and financial condition for the periods and dates indicated, with
such certification to be free of exceptions and qualifications as to the scope
of the audit or as to the going concern nature of the business.



               (b) Quarterly Financial Statements. As soon as available, and in
any event within 45 days after each of the first three fiscal quarters of each
fiscal year during the Term of this Agreement, the unaudited balance sheet of
UDRT and its Subsidiaries as of the end of such fiscal quarter, the unaudited
statement of income and retained earnings of UDRT and its Subsidiaries and the
unaudited statement of cash flows of UDRT and its Subsidiaries for the portion
of the fiscal year ended with the last day of such quarter, all in reasonable
detail and stating in comparative form the respective figures for the
corresponding date and period in the previous fiscal year, accompanied by a
certificate of the Chief Financial Officer or the Vice President of Finance of
UDRT to the effect that such financial statements have been prepared in
accordance with GAAP, consistently applied, and that such financial statements
fairly present the results of its operations and financial condition for the
periods and dates indicated subject to year end adjustments in accordance with
GAAP.



               (c) Quarterly Property Statements. As soon as available, and in
any event within forty five (45) days after each Calendar Quarter, a statement
of income and expenses of each Mortgaged Property accompanied by a certificate
of the Chief Financial Officer of UDRT to the effect that each such statement of
income and expenses fairly, accurately and completely presents the operations of
each such Mortgaged Property for the period indicated.



               (d) Annual Property Statements. On an annual basis within ninety
(90) days of the end of its fiscal year, an annual statement of
income and expenses of each Mortgaged Property



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accompanied
by a certificate of the Chief Financial Officer of UDRT to the effect that each such statement of income and expenses fairly, accurately and
completely presents the operations of each such Mortgaged Property
for the period indicated.




               (e) Updated Rent Rolls. As soon as available, and in any event
within forty five (45) days after each Calendar Quarter, a current Rent Roll for
each Mortgaged Property, showing the name of each tenant, and for each tenant,
the space occupied, the lease expiration date, the rent payable, the rent paid
and any other information requested by the Lender and accompanied by a
certificate of the Chief Financial Officer of UDRT to the effect that each such
Rent Roll fairly, accurately and completely presents the information required
therein.



               (f) Security Deposit Information. Upon the Lender’s request,
an accounting of all security deposits held in connection with any Lease of any
part of any Mortgaged Property, including the name and identification number of
the accounts in which such security deposits are held, the name and address of
the financial institutions in which such security deposits are held and the name
and telephone number of the person to contact at such financial institution,
along with any authority or release necessary for the Lender to access
information regarding such accounts.



               (g) Security Law Reporting Information. So long as UDRT is a
reporting company under the Securities and Exchange Act of 1934, promptly upon
becoming available, (a) copies of all financial statements, reports and proxy
statements sent or made available generally by UDRT, or any of its Affiliates,
to its respective security holders, (b) all regular and periodic reports and all
registration statements (other than the exhibits thereto and any registration
statements on Form S 8 or a similar form) and prospectuses, if any, filed by
UDRT, or any of its Affiliates, with the Securities and Exchange Commission or
other Governmental Authorities, and (c) all press releases and other statements
made available generally by UDRT, or any of its Affiliates, to the public
concerning material developments in the business of UDRT or other party.



               (h) Accountants’ Reports. Promptly upon receipt thereof,
copies of any reports or management letters submitted to the Borrower by its
independent certified public accountants in connection with the examination of
its financial statements made by such accountants (except for reports otherwise
provided pursuant to subsection (a) above); provided, however, that the Borrower
shall only be required to deliver such reports and management letters to the
extent that they relate to any Borrower or any Mortgaged Property.



               (i) Annual Budgets. Promptly, and in any event within 60 days
after the start of its fiscal year, an annual budget for each Mortgaged Property
for such fiscal year, setting forth an estimate of all of the costs and
expenses, including capital expenses, of maintaining and operating each
Mortgaged Property.



               (j) Borrower Plans and Projections. To the extent prepared in
the ordinary course of business of the Borrower and in the form prepared by the
Borrower in the ordinary course of business, within 30 days after its
preparation, copies of (1) the Borrower’s business plan for the current and the
succeeding two fiscal years, (2) the Borrower’s annual budget (including capital
expenditure budgets) and projections for each Mortgaged Property; and (3) the
Borrower’s financial projections for the current and the succeeding two fiscal
years.



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               (k) Strategic Plan. To the extent prepared in the ordinary course
of business of the Borrower and in the form prepared by the Borrower in the
ordinary course of business, within 30 days after its preparation, a written
narrative discussing the Borrower’s short and long range plans, including its
plans for operations, mergers, acquisitions and management, and accompanied by
supporting financial projections and schedules, certified by a member of Senior
Management as true, correct and complete (“Strategic Plan”) If the Borrower’s
Strategic Plan materially changes, then such person shall deliver to the Lender
the Strategic Plan as so changed.



               (l) Annual Rental and Sales Comparable Analysis. To the extent
prepared in the ordinary course of business of the Borrower and in the form
prepared by the Borrower in the ordinary course of business, within 30 days
after its preparation, a rental and sales comparable analysis of the local real
estate market in which each Mortgaged Property is located.



               (m) Other Reports. Promptly upon receipt thereof, all schedules,
financial statements or other similar reports delivered by the Borrower pursuant
to the Loan Documents or requested by the Lender with respect to the Borrower’s
business affairs or condition (financial or otherwise) or any of the Mortgaged
Properties.



               (n) Certification. All certifications required to be delivered
pursuant to this Section 13.04 shall run directly to and be for the benefit of

Lender and Fannie Mae.


SECTION 13.05 Certificate of Compliance. The Borrower shall deliver to the
Lender concurrently with the delivery of the financial statements and/or reports
required to be delivered pursuant to Section 13.04 (a) and (b) above a
certificate signed by the Chief Financial Officer, Treasurer or Vice President
of Finance of UDRT stating that, to the best knowledge of such individual
following reasonable inquiry, (i) setting forth in reasonable detail the
calculations required to establish whether UDRT was in compliance with the
requirements of Sections 15.02 through 15.09 on the date of such financial
statements, and (ii) stating that, to the best knowledge of such individual
following reasonable inquiry, no Event of Default or Potential Event of Default
has occurred, or if an Event of Default or Potential Event of Default has
occurred, specifying the nature thereof in reasonable detail and the action
which UDRT is taking or proposes to take with respect thereto. Any certificate
required by this Section 13.05 shall run directly to and be for the benefit of
Lender and Fannie Mae.



SECTION 13.06 Maintain Licenses. The Borrower shall procure and maintain in full
force and effect all licenses, Permits, charters and registrations which are
material to the conduct of its business and shall abide by and satisfy all terms
and conditions of all such licenses, Permits, charters and registrations.



SECTION 13.07 Access to Records; Discussions With Officers and Accountants. To
the extent permitted by law and in addition to the applicable requirements of
the Security Instruments, the Borrower shall permit the Lender, upon reasonable
notice to the Borrower and provided Lender observes reasonable security and
confidentiality procedures of the Borrower:




               (a) to inspect, make copies and abstracts of, and have reviewed or
audited, such of the Borrower’s books and records as may relate to the
Obligations or any Mortgaged Property;



- 56 -









 





               (b) to discuss the Borrower’s affairs, finances and accounts
with any of UDRT’s Chief Operating Officer, Chief Financial Officer, Vice
President of Finance, Treasurer, Assistant Treasurer, Comptroller and any other
person performing the functions of said officers;



               (c) to discuss the Borrower’s affairs, finances and accounts
with its independent public accountants, provided that the Chief Financial
Officer of UDRT has been given the opportunity by the Lender to be a party to
such discussions; and



               (d) to receive any other information that the Lender deems
necessary or relevant in connection with any Advance, any Loan
Document or the Obligations.


Notwithstanding the foregoing, prior to an Event of Default or Potential Event
of Default, all inspections shall be conducted at reasonable times during normal
business hours.



SECTION 13.08 Inform the Lender of Material Events. The Borrower shall promptly
inform the Lender in writing of any of the following (and shall deliver to the
Lender copies of any related written communications, complaints, orders,
judgments and other documents relating to the following) of which the Borrower
has actual knowledge:




               (a) Defaults. The occurrence of any Event of Default or any
Potential Event of Default under this Agreement or any other Loan Document;



               (b) Regulatory Proceedings. The commencement of any
rulemaking or disciplinary proceeding or the promulgation of any proposed or
final rule which would have, or may reasonably be expected to have, a Material
Adverse Effect;



               (c) Legal Proceedings. The commencement or threat of, or
amendment to, any proceedings by or against the Borrower in any Federal, state
or local court or before any Governmental Authority, or before any arbitrator,
which, if adversely determined, would have, or at the time of determination may
reasonably be expected to have, a Material Adverse Effect;



               (d) Bankruptcy Proceedings. The commencement of any
proceedings by or against the Borrower under any applicable bankruptcy,
reorganization, liquidation, insolvency or other similar law now or hereafter in
effect or of any proceeding in which a receiver, liquidator, trustee or other
similar official is sought to be appointed for it;



               (e) Regulatory Supervision or Penalty. The receipt of notice
from any Governmental Authority having jurisdiction over the Borrower that (A)
the Borrower is being placed under regulatory supervision, (B) any license,
Permit, charter, membership or registration material to the conduct of the
Borrower’s business or the Mortgaged Properties is to be suspended or revoked or
(C) the Borrower is to cease and desist any practice, procedure or policy
employed by the Borrower, as the case may be, in the conduct of its business,
and such cessation would have, or may reasonably be expected to have, a Material
Adverse Effect;



               (f) Environmental Claim. The receipt from any Governmental
Authority or other Person of any notice of violation, claim, demand, abatement,
order or other order or direction (conditional or otherwise) for any damage,
including personal injury (including sickness, disease or death), tangible or
intangible property damage, contribution, indemnity, indirect or consequential



- 57 -









 




damages, damage to the environment, pollution, contamination or other adverse
effects on the environment, removal, cleanup or remedial action or for fines,
penalties or restrictions, resulting from or based upon (a) the existence or
occurrence, or the alleged existence or occurrence, of a Hazardous Substance
Activity or (b) the violation, or alleged violation, of any Hazardous Materials
Laws in connection with any Mortgaged Property or any of the other assets of the
Borrower;




               (g) Material Adverse Effects. The occurrence of any act,
omission, change or event which has a Material Adverse Effect, subsequent to the
date of the most recent audited financial statements of the Borrower delivered
to the Lender pursuant to Section 13.04;



               (h) Accounting Changes. Any material change in the Borrower’s
accounting policies or financial reporting practices; and



               (i) Legal and Regulatory Status. The occurrence of any act,
omission, change or event, including any Governmental Approval, the result of
which is to change or alter in any way the legal or regulatory status of the
Borrower.


SECTION 13.09 Intentionally Omitted.



SECTION 13.10 Inspection. Subject to the rights of tenants and upon reasonable
notice, the Borrower shall permit any Person designated by the Lender: (i) to
make entries upon and inspections of the Mortgaged Properties; and (ii) to
otherwise verify, examine and inspect the amount, quantity, quality, value
and/or condition of, or any other matter relating to, any Mortgaged Property;
provided, however, that prior to an Event of Default or Potential Event of
Default, all such entries, examinations and inspections shall be conducted at
reasonable times during normal business hours.



SECTION 13.11 Compliance with Applicable Laws. The Borrower shall comply in all
material respects with all Applicable Laws now or hereafter affecting any
Mortgaged Property or any part of any Mortgaged Property or requiring any
alterations, repairs or improvements to any Mortgaged Property. The Borrower
shall procure and continuously maintain in full force and effect, and shall
abide by and satisfy all material terms and conditions of all Permits.



SECTION 13.12 Warranty of Title. The Borrower shall warrant and defend (a) the
title to each Mortgaged Property and every part of each Mortgaged Property,
subject only to Permitted Liens, and (b) the validity and priority of the lien
of the applicable Loan Documents, subject only to Permitted Liens, in each case
against the claims of all Persons whatsoever. The Borrower shall reimburse the
Lender for any losses, costs, damages or expenses (including reasonable
attorneys’ fees and court costs) incurred by the Lender if an interest in any
Mortgaged Property, other than with respect to a Permitted Lien, is claimed by
others.



SECTION 13.13 Defense of Actions. The Borrower shall appear in and defend
(whether or not such defense is provided by Borrower’s insurance) any action or
proceeding purporting to affect the security for this Agreement or the rights or
power of the Lender hereunder, and shall pay all costs and expenses, including
the cost of evidence of title and reasonable attorneys’ fees, in any such action
or proceeding in which the Lender may appear. If the claim is insured and
Borrower’s insurance company provides a defense, Borrower may rely on such
defense. If the Borrower fails to perform any of the covenants or agreements
contained in this Agreement, or if any action or





- 58 -









 







proceeding is commenced that is not diligently defended by the Borrower which
affects in any material respect the Lender’s interest in any Mortgaged Property
or any part thereof, including eminent domain, code enforcement or proceedings
of any nature whatsoever under any Applicable Law, whether now existing or
hereafter enacted or amended, then the Lender may, but without obligation to do
so and without notice to or demand upon the Borrower and without releasing the
Borrower from any Obligation, make such appearances, disburse such sums and take
such action as the Lender deems necessary or appropriate to protect the Lender’s
interest, including disbursement of attorney’s fees, entry upon such Mortgaged
Property to make repairs or take other action to protect the security of said
Mortgaged Property, and payment, purchase, contest or compromise of any
encumbrance, charge or lien which in the judgment of the Lender appears to be
prior or superior to the Loan Documents. In the event (i) that any Security
Instrument is foreclosed in whole or in part or that any Loan Document is put
into the hands of an attorney for collection, suit, action or foreclosure, or
(ii) of the foreclosure of any mortgage, deed to secure debt, deed of trust or
other security instrument prior to or subsequent to any Security Instrument or
any Loan Document in which proceeding the Lender is made a party or (iii) of the
bankruptcy of the Borrower or an assignment by the Borrower for the benefit of
their respective creditors, the Borrower shall be chargeable with and agrees to
pay all costs of collection and defense, including actual attorneys’ fees in
connection therewith and in connection with any appellate proceeding or
post judgment action involved therein, which shall be due and payable together
with all required service or use taxes.



SECTION 13.14 Alterations to the Mortgaged Properties. Except as otherwise
provided in the Loan Documents, the Borrower shall have the right to undertake
any alteration, improvement, demolition, removal or construction (collectively,
“Alterations”) to the Mortgaged Property which it owns without the prior consent
of the Lender; provided, however, that in any case, no such Alteration shall be
made to any Mortgaged Property without the prior written consent of the Lender
if (i) such Alteration could reasonably be expected to adversely affect the
value of such Mortgaged Property or its operation as a multifamily housing
facility in substantially the same manner in which it is being operated on the
date such property became Collateral, (ii) the construction of such Alteration
could reasonably be expected to result in interference to the occupancy of
tenants of such Mortgaged Property such that tenants in occupancy with respect
to five percent (5%) or more of the Leases would be permitted to terminate their
Leases or to abate the payment of all or any portion of their rent, or (iii)
such Alteration will be completed in more than 12 months from the date of
commencement or in the last year of the Term of this Agreement. Notwithstanding
the foregoing, the Borrower must obtain the Lender’s prior written consent to
construct Alterations with respect to the Mortgaged Property costing in excess
of the lesser of (i) five percent (5%) of the Allocable Facility Amount of such
Mortgaged Property and (ii) $250,000 and the Borrower must give prior written
notice to the Lender of its intent to construct Alterations with respect to such
Mortgaged Property costing in excess of $100,000; provided, however, that the
preceding requirements shall not be applicable to Alterations made, conducted or
undertaken by the Borrower as part of the Borrower’s routine maintenance and
repair of the Mortgaged Properties as required by the Loan Documents.



SECTION 13.15 ERISA. The Borrower shall at all times remain in compliance in all
material respects with all applicable provisions of ERISA and similar requirements of the PBGC.




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SECTION 13.16 Loan Document Taxes. If any tax, assessment or Imposition (other
than a franchise tax imposed on or measured by, the net income or capital
(including branch profits tax) of the Lender (or any transferee or assignee
thereof, including a participation holder)) (“Loan Document Taxes”) is levied,
assessed or charged by the United States, or any State in the United States, or
any political subdivision or taxing authority thereof or therein upon any of the
Loan Documents or the obligations secured thereby, the interest of the Lender in
the Mortgaged Properties, or the Lender by reason of or as holder of the Loan
Documents, the Borrower shall pay all such Loan Document Taxes to, for, or on
account of the Lender (or provide funds to the Lender for such payment, as the
case may be) as they become due and payable and shall promptly furnish proof of
such payment to the Lender, as applicable. In the event of passage of any law or
regulation permitting, authorizing or requiring such Loan Document Taxes to be
levied, assessed or charged, which law or regulation in the opinion of counsel
to the Lender may prohibit the Borrower from paying the Loan Document Taxes to
or for the Lender, the Borrower shall enter into such further instruments as may
be permitted by law to obligate the Borrower to pay such Loan Document Taxes.



SECTION 13.17 Further Assurances. The Borrower, at the request of the Lender,
shall execute and deliver and, if necessary, file or record such statements,
documents, agreements, UCC financing and continuation statements and such other
instruments and take such further action as the Lender from time to time may
request as reasonably necessary, desirable or proper to carry out more
effectively the purposes of this Agreement or any of the other Loan Documents or
to subject the Collateral to the lien and security interests of the Loan
Documents or to evidence, perfect or otherwise implement, to assure the lien and
security interests intended by the terms of the Loan Documents or in order to

exercise or enforce its rights under the Loan Documents.



SECTION 13.18 Monitoring Compliance. Upon the request of the Lender, from time
to time, the Borrower shall promptly provide to the Lender such documents,
certificates and other information as may be deemed necessary to enable the
Lender to perform its functions under the Servicing Agreement.



SECTION 13.19 Leases. Each unit in each Mortgaged Property will be leased
pursuant to the form lease delivered to, and acceptable to, the Lender, with no
material modifications to such approved form lease, except as disclosed in
writing to the Lender.



SECTION 13.20 Appraisals. At any time and from time to time (but not to exceed
once per calendar year), the Lender shall be entitled to obtain an Appraisal of
any Mortgaged Property. At the time of the addition of a Mortgaged Property to
the Collateral Pool, the Lender shall be entitled to obtain an Appraisal of such
Mortgaged Property. The Borrower shall pay all of the Lender’s costs of
obtaining the Appraisal.



SECTION 13.21 Transfer of Ownership Interests of the Borrower.




               (a) Prohibition on Transfers and Changes of Control. The
Borrower shall not cause or permit a Transfer or a Change of Control.



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               (b) Permitted Acts. Notwithstanding the provisions of
paragraph (a) of this Section 13.21, the following Transfers and transactions by

the Borrower are permitted without the consent of the Lender:




               (i) The grant of a leasehold interest in individual
dwelling units or commercial spaces in any Mortgaged Property in

accordance with the Security Instrument.




               (ii) A sale or other disposition of obsolete or worn
out personal property located in any Mortgaged Property which is
contemporaneously replaced by comparable personal property of equal or
greater value which is free and clear of liens, encumbrances and

security interests other than those created by the Loan Documents.




               (iii) The creation of a mechanic’s or materialmen’s
lien or judgment lien against a Mortgaged Property which is released of
record or otherwise remedied to Lender’s satisfaction within 30 days of
the date of creation.




               (iv) The grant of an easement, if prior to the
granting of the easement the Borrower causes to be submitted to Lender
all information required by Lender to evaluate the easement, and if
Lender consents to such easement based upon Lender’s determination that
the easement will not materially affect the operation of the Mortgaged
Property or Lender’s interest in the Mortgaged Property and Borrower
pays to Lender, on demand, all costs and expenses incurred by Lender in
connection with reviewing Borrower’s request. Lender shall not
unreasonably withhold its consent to or withhold its agreement to
subordinate the lien of a Security Instrument to (A) the grant of a
utility easement serving a Mortgaged Property to a publicly operated
utility, or (B) the grant of an easement related to expansion or
widening of roadways, provided that any such easement is in form and
substance reasonably acceptable to Lender and does not materially and
adversely affect the access, use or marketability of a Mortgaged
Property.




               (v) The transfer of shares of common stock,
membership interests, or other beneficial or ownership interest or
other forms of securities in the Borrower, and the issuance of all
varieties of convertible debt, equity and other similar securities of
the Borrower, and the subsequent transfer of such securities; provided,
however, that no Change in Control occurs as a result of such transfer,
either upon such transfer or upon the subsequent conversion to equity
or such convertible debt or other securities.




               (vi) The issuance by Borrower of additional limited
partnership units or convertible debt, equity, membership interests,
and other similar securities, and the subsequent transfer of such units
or other securities; provided, however, that no Change in Control
occurs as the result of such transfer, either upon such transfer or
upon the subsequent conversion to equity of such convertible debt or
other securities.




               (vii) A merger with or acquisition of another entity
by Borrower, provided that (A) Borrower is the surviving entity after

such merger or acquisition, (B) no Change in Control occurs, and (C)
such merger or acquisition does not result in an Event of Default, as
such terms are defined in this Agreement.



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               (viii) A Transfer in connection with any substitution or
release pursuant to the terms and conditions of Article VII of this

Agreement.



               (c) Consent to Prohibited Acts. Lender may, in its sole and
absolute discretion, consent to a Transfer or Change of Control that would
otherwise violate this Section 13.21 if, prior to the Transfer or Change of
Control, Borrower has satisfied each of the following requirements:




               (i) the submission to Lender of all information
required by Lender to make the determination required by this Section

13.21(c);




               (ii) the absence of any Event of Default;




               (iii) the transferee meets all of the eligibility,
credit, management and other standards (including any standards with
respect to previous relationships between Lender and the transferee and
the organization of the transferee) customarily applied by Lender at
the time of the proposed transaction to the approval of borrowers in
connection with the origination or purchase of similar mortgages, deeds
of trust or deeds to secure debt on multifamily properties;




               (iv) in the case of a transfer of direct or indirect
ownership interests in Borrower, if transferor or any other person has
obligations under any Loan Documents, the execution by the transferee
of one or more individuals or entities acceptable to Lender of an
assumption agreement that is acceptable to Lender and that, among other
things, requires the transferee to perform all obligations of
transferor or such person set forth in such Loan Document, and may
require that the transferee comply with any provisions of this
Instrument or any other Loan Document which previously may have been
waived by Lender;




               (v) Lender’s receipt of all of the following:




                    (A) a transfer fee equal to 1 percent of the
Commitment immediately prior to the transfer.




                    (B) In addition, Borrower shall be required to
reimburse Lender for all of Lender’s out of pocket costs
(including reasonable attorneys’ fees) incurred in reviewing
the Borrower’s request.


SECTION 13.22 Change in Senior Management. The Borrower shall give the Lender
notice of any change in the identity of the Chief Executive Officer or the Chief Financial Officer of UDRT.



SECTION 13.23 Date Down Endorsements. At any time and from time to time, a
Lender may obtain an endorsement to each Title Insurance Policy containing a
Revolving Credit Endorsement, amending the effective date of the Title Insurance
Policy to the date of the title search performed in connection with the
endorsement. The Borrower shall pay for the cost and expenses incurred by the
Lender to the Title Company in obtaining such endorsement, provided that, for
each Title Insurance Policy, it shall not be liable to pay for more than one
such endorsement in any consecutive 12 month period.





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SECTION 13.24 Geographical Diversification. From and after the date on which the
Collateral Pool first consists of ten (10) or more Mortgaged Properties, the
Borrower shall maintain Mortgaged Properties in the Collateral Pool so that the
Collateral Pool consists of at least nine (9) Mortgaged Properties located in at
least five (5) SMSA’s, provided, however, that, upon the occurrence of any
increase in the Commitment pursuant to Article VIII, the Borrower shall at all
times thereafter cause the Collateral Pool to satisfy such other Geographical
Diversification Requirements as the Lender may determine and notify Borrower of
at the time of the increase.



SECTION 13.25 Ownership of Mortgaged Properties. The Borrower shall be the sole
owner of each of the Mortgaged Properties free and clear of any Liens other than
Permitted Liens. Each Mortgaged Property located in the State of California
shall be owned by a Borrower that owns no assets other than (i) the Mortgaged
Properties and (ii) assets incident to the ownership, maintenance or operation
of such Mortgaged Property.



SECTION 13.26 Facility Balancing. If the Borrower fails to meet the Coverage and
LTV Tests then, within 45 days of Lender’s notice to Borrower of such failure,
the Borrower shall (i) add Additional Mortgaged Properties to the Collateral
Pool in accordance with Article VI so that after such addition the Coverage and
LTV Tests are met, or (ii) prepay Advances Outstanding in an amount sufficient
to cause the Borrower to be in compliance with the Coverage and LTV Tests. Any
prepayments made pursuant to the preceding sentence shall be applied first
against the Variable Advances Outstanding in the sequence specified by Borrower
until there are no further Variable Advances Outstanding then against the
prepayment of Fixed Advances Outstanding so long as the prepayment is permitted
under the applicable Fixed Facility Note. If no prepayment is permitted under
the applicable Fixed Facility Note, such prepayment amount shall be held by
Lender (or its appointed collateral agent) as Substitute Cash Collateral in
accordance with a security agreement and other documents in form and substance
acceptable to Lender. Any Substitute Cash Collateral remaining will be returned
to the Borrower on the earlier of the date when the Coverage and LTV Tests are
again met or the Termination Date. If on the date the Borrower pays any amounts
required by this Section, Variable Advances are Outstanding but are not then due
and payable, Lender shall hold such amounts (which amounts shall bear interest
at a rate determined by Lender) as additional collateral until the next date on
the Variable Advances are due and payable at which time Lender shall apply the
appropriate portion of such prepayment to such Variable Advances.




ARTICLE XIV

NEGATIVE COVENANTS OF THE BORROWER



The
Borrower agrees and covenants with the Lender that, at all times during the Term of this Agreement:



SECTION 14.01 Other Activities. The Borrower shall not:




               (a) either directly or indirectly sell, transfer, exchange or
otherwise dispose of any of its assets if such sale, transfer, exchange or

disposal would result in an Event of Default or Potential Event of Default;



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               (b) amend its Organizational Documents in any material respect
without the prior written consent of the Lender except in connection with a
stock split or the issuance of stock of the Borrower, provided such stock split
or issuance does not result in an Event of Default or Potential Event of
Default;



               (c) dissolve or liquidate in whole or in part, unless the surviving
entity is in compliance with the terms and conditions of this Agreement and the
Other Loan Documents;



               (d) merge or consolidate with any Person, unless the surviving
entity is in compliance with the terms and conditions of this
Agreement and the Other Loan Documents; or



               (e) use, or permit to be used, any Mortgaged Property for any uses
or purposes other than as a Multifamily Residential Property.


SECTION 14.02 Value of Security. The Borrower shall not take any action which
could reasonably be expected to have any Material Adverse Effect.



SECTION 14.03 Zoning. The Borrower shall not initiate or consent to any zoning
reclassification of any Mortgaged Property or seek any variance under any zoning
ordinance or use or permit the use of any Mortgaged Property in any manner that
could result in the use becoming a nonconforming use under any zoning ordinance
or any other applicable land use law, rule or regulation.



SECTION 14.04 Liens. The Borrower shall not create, incur, assume or suffer to
exist any Lien on any Mortgaged Property or any part of any Mortgaged
Property, except the Permitted Liens.



SECTION 14.05 Sale. The Borrower shall not Transfer any Mortgaged Property or
any part of any Mortgaged Property without the prior written consent of the
Lender (which consent may be granted or withheld in the Lender’s discretion), or
any interest in any Mortgaged Property, other than to enter into Leases for
units in a Mortgaged Property to any tenant in the ordinary course of business.



SECTION 14.06 Intentionally Omitted.



SECTION 14.07 Principal Place of Business. The Borrower shall not change its
principal place of business or the location of its books and records, each as
set forth in Section 12.01(a), without first giving 30 days’ prior written
notice to the Lender.



SECTION 14.08 Intentionally Omitted.



SECTION 14.09 Change in Property Management. The Borrower shall not change the
management agent for any Mortgaged Property except to a management agent which
the Lender determines is qualified in accordance with the criteria set forth in
Section 701 of the DUS Guide.



SECTION 14.10 Condominiums. The Borrower shall not submit any Mortgaged Property
to a condominium regime during the Term of this Agreement.




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SECTION 14.11 Restrictions on Distributions. The Borrower shall not make any
distributions of any nature or kind whatsoever to the owners of its Ownership
Interests as such if, at the time of such distribution, a Potential Event of
Default or an Event of Default has occurred and remains uncured.



SECTION 14.12 Conduct of Business. The conduct of the Borrower’s businesses
shall not violate the Organizational Documents pursuant to which it is formed.



SECTION 14.13 Limitation on Unimproved Real Property and New Construction. The
Borrower shall not permit:




          (a) the value of its real property which is not improved (except real
property on which phases of a Mortgaged Property are contemplated to be
constructed) by one or more buildings leased, or held out for lease, to third
parties (“Unimproved Real Property”) to exceed 10% of the value of all of its
“Real Estate Assets” (as that term is defined in Section 856(c)(6)(B) of the
Internal Revenue Code and the regulations thereunder); and




          (b) the sum of (i) the value of its Unimproved Real Property and (ii)
the value of its Real Estate Assets which are under construction or subject to
substantial rehabilitation to exceed 20% of the value of all of its Real Estate
Assets.



All of the foregoing values shall be reasonably determined by the Lender.



SECTION 14.14 No Encumbrance of Collateral Release Property. Unless the Borrower
sells a Collateral Release Property to a Person who is not an Affiliate of the
Borrower substantially simultaneously with the release of the Collateral Release
Property from the Collateral Pool, the Borrower shall not encumber the
Collateral Release Property for a period of 120 days following
the release of the Collateral Release Property from the Collateral Pool.




ARTICLE XV

FINANCIAL COVENANTS OF THE BORROWER



The
Borrower agrees and covenants with the Lender that, at all times during the Term of this Agreement:



SECTION 15.01 Financial Definitions. For all purposes of this Agreement, the
following terms shall have the respective meanings set forth below:




     “Cash Equivalents” means (a) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof) having maturities of not more
than twelve months from the date of acquisition, (b) U.S. dollar denominated
time deposits and certificates of deposit of (i) any Lender, or (ii) any
domestic commercial bank of recognized standing (y) having capital and surplus
in excess of $500,000,000 and (z) whose short term commercial paper rating from
S&P is at least A 2 (and not lower than A 3) or the equivalent thereof or from
Moody’s is at least P 2 (and not lower than P 3) or the equivalent thereof (any
such bank being an “Approved Bank”), in each case with maturities of not more
than 270 days from the date



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of acquisition, (c) commercial paper and variable or fixed rate notes issued by
any Approved Bank (or by the parent company thereof) or any variable rate notes
issued by, or guaranteed by, any domestic corporation rated at least A 2 (and
not lower than A 3) or the equivalent thereof by S&P or at least P 2 (and not
lower than P 3) or the equivalent by Moody’s and maturing within six months of
the date of acquisition, (d) repurchase agreements entered into by a Person with
a bank or trust company (including any of the Lenders) or recognized securities
dealer having capital and surplus in excess of $500,000,000 for direct
obligations issued by or fully guaranteed by the United States of America in
which such Person shall have a perfected first priority security interest
(subject to no other Liens) and having, on the date of purchase thereof, a fair
market value of at least 100% of the amount of the repurchase obligations, (e)
obligations of any State of the United States or any political subdivision
thereof, the interest with respect to which is exempt from federal income
taxation under Section 103 of the Code, having a long term rating of at least
AA or Aa 3 by S&P or Moody’s, respectively, and maturing within three years
from the date of acquisition thereof, (f) Investments in municipal auction
preferred stock (i) rated A (or the equivalent thereof) or better by S&P or A3
(or the equivalent thereof) or better by Moody’s and (ii) with dividends that
reset at least once every 365 days and (g) Investments, classified in accordance
with GAAP as current assets, in money market investment programs registered
under the Investment Borrower Act of 1940, as amended, which are administered by
reputable financial institutions having capital of at least $100,000,000 and the
portfolios of which are limited to Investments of the character described in the
foregoing subdivisions (a) through (f).




     “Consolidated Adjusted EBITDA” means for any period the Consolidated Group
the sum of Consolidated EBITDA for such period minus a reserve equal to $62.50
per apartment unit per quarter ($250 per apartment unit per year). Except as
expressly provided otherwise, the applicable period shall be for the single
fiscal quarter ending as of the date of determination.



     “Consolidated EBITDA” means for any period for the Consolidated Group, the
sum of Consolidated Net Income plus Consolidated Interest Expense plus all
provisions for any Federal, state, or other income taxes plus depreciation,
amortization and other non cash charges, in each case on a consolidated basis
determined in accordance with GAAP applied on a consistent basis, but excluding
in any event gains and losses on Investments and extraordinary gains and losses,
and taxes on such excluded gains and tax deductions or credit on account of such
excluded losses. Except as expressly provided otherwise, the applicable period
shall be for the single fiscal quarter ending as of the date of determination.



     “Consolidated Adjusted Tangible Net Worth” means at any rate:




     (i) the sum of (A) the consolidated shareholders equity of the
Consolidated Group (net of Minority Interests) plus (B) accumulated
depreciation of real estate owned to the extent reflected in the then book
value of the Consolidated Assets, minus without duplication




     (ii) the Intangible Assets of the Consolidated Group.



     “Consolidated Funded Debt” means total Debt of the Consolidated Group on a
consolidated basis determined in accordance with GAAP applied on a
consistent basis.



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     “Consolidated Group” means the Borrower and its consolidated Subsidiaries,
as determined in accordance with GAAP.



     “Consolidated Interest Expense” means for any period for the Consolidated
Group, all interest expense, including the amortization of debt discount and
premium, the interest component under capital leases and the implied interest
component under Securitization Transactions in each case on a consolidated basis
determined in accordance with GAAP applied on a consistent basis.



     “Consolidated Net Income” means for any period the net income of the
Consolidated Group on a consolidated basis determined in accordance
with GAAP applied on a consistent basis.



     “Consolidated Net Operating Income from Realty” means for any period for
any Realty of the Consolidated Group, an amount equal to the aggregate rental
and other income from the operation of such Realty during such period; minus all
expenses and other proper charges incurred in connection with the operation of
such Realty (including, without limitation, real estate taxes and bad debt
expenses) during such period; but in any case, before payment of provision for
debt service charges for such period, income taxes for such period, and
depreciation, amortization and other non cash expenses for such period, all on a
consolidated basis determined in accordance with GAAP on a consistent basis.



     “Consolidated Net Operating Income from Unencumbered Realty” (i) the
aggregate rental and other income from the operation of such Realty during such
period; minus all expenses and other proper charges incurred in connection with
the operation of such Realty (including, without limitation, real estate taxes
and bad debt expenses) during such period; but in any case, before payment of
provision for debt service charges for such period, income taxes for such
period, and depreciation, amortization and other non cash expenses for such
period, all on a consolidated basis determined in accordance with GAAP on a
consistent basis minus (ii) a reserve equal to $62.50 per apartment unit per
quarter ($250 per apartment unit per year) for such period.



     “Consolidated Total Fixed Charges” means as of the last day of each fiscal
quarter for the Consolidated Group, the sum of (i) the cash
portion of Consolidated Interest Expense paid in the fiscal quarter ending on such day plus
(ii) scheduled maturities of Consolidated Funded Debt (excluding the amount by
which a final installment exceeds the next preceding principal installment
thereon and further excluding amortization on Insurance Company Debt which shall
not exceed $7.5 million annually) in the fiscal quarter ending on such day plus
(iii) all cash dividends and distributions on preferred stock or other preferred
beneficial interests of members of the Consolidated Group paid in the fiscal
quarter ending on such day, all on a consolidated basis determined in accordance
with GAAP on a consistent basis.



     “Consolidated Unsecured Debt” means, for the Consolidated Group on a
consolidated basis, all unsecured Consolidated Funded Debt.



     “Consolidated Unencumbered Realty” means for the Consolidated Group on a
consolidated basis, all Realty which is not encumbered by a Lien securing Debt.
For purposes of the covenant, Consolidated Unencumbered Realty as of any date,
for the Consolidated Group, shall be valued at the sum (without duplication) of
(a) with respect to any consolidated Unencumbered Realty



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purchased or developed prior to January 1 of the year preceding such date, (i)
Consolidated Net Operating Income from Unencumbered Realty for the fiscal
quarter most recently ended prior to such date multiplied by four, divided by
(ii) 9.25%; plus (b) with respect to any Consolidated Unencumbered Realty
purchased or developed on or after January 1 of the year preceding such date,
the actual costs of such Realty; plus (c) with respect to any Consolidated
Unencumbered Realty that also constitutes consolidated Unimproved Realty, the
sum of (i) fifty percent (50%) of the GAAP value of the land associated with
such Realty plus (ii) an amount equal to fifty percent (50%) of the actual
expenditures for improvements on such Realty; plus (d) fifty percent (50%) of
the Consolidated Group’s pro rata share of the GAAP value of any Realty
contributed to or otherwise invested in joint ventures which is not encumbered
by a Lien securing Debt.



     “Debt” of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such
person evidenced by bonds, debentures, notes or other similar instruments, (iii)
all obligations of such Person to pay deferred purchase price of property or
services (other than trade accounts payable arising in the ordinary course of
business), (iv) all obligations of such Person as lessee under capital leases,
(v) all obligations of such Person to purchase securities or other property
which arise out of or in connection with the sale of the same or substantially
similar securities or property, (vi) all obligations of such person to reimburse
any bank or other person in respect of amounts payable under a letter of credit
or similar instrument (being the amount available to be drawn thereunder,
whether or not then drawn), (vii) all obligations of others secured by a Lien on
any asset of such Person, whether or not such obligation is assumed by such
Person, (viii) all obligations of others Guaranteed by such Person, (ix) all
obligations which in accordance with GAAP would be shown as liabilities on a
balance sheet of such Person, (x) the Attributed Principal Amount under any
Securitization Transaction and (xi) all obligations of such person owing under
any synthetic lease, tax retention operating lease, off balance sheet loan or
similar off balance sheet financing product to which such Person is a party,
where such transaction is considered borrowed money indebtedness for tax
purposes, but classified as an operating lease in accordance with GAAP. Debt of
any Person shall include Debt of any partnership or joint venture in which such
Person is a general partner or joint venturer to the extent of such Person’s pro
rata portion of the ownership of such partnership or joint venture (except if
such Debt is recourse to such Person, in which case the greater of such Person’s
pro rata portion of such Debt or the amount of the recourse portion of the Debt,
shall be included as Debt of such Person).



     “Insurance Company Debt” means Debt owed by the Borrower with respect to
the 7.98% Notes due March 2000 2003 as more fully described in
note 4 of the consolidated financial statements contained in the Borrower’s report on form 10
K filed with the Securities and Exchange commission for fiscal year 1999.



     “Intangible Assets” of any Person means at any date the amount of (i) all
write ups (other than write ups resulting from write ups of assets of a going
concern business made within twelve months after the acquisition of such
business) in the book value of any asset owned by such Person and (ii) all
unamortized debt discount and expense, unamortized deferred charges, capitalized
start up costs, goodwill, patents, licenses, trademarks, trade names,
copyrights, organization or developmental expenses, covenants not to compete and
other intangible items.



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     “Minority Interest” means any shares of stock (or other equity interests)
of any class of a Subsidiary (other than directors’ qualifying shares as
required by law) that are not owned by the Borrower and/or one or more Wholly
Owned Subsidiaries. Minority Interests constituting preferred stock shall be
valued at the voluntary or involuntary liquidation value of such preferred
stock, whichever is greater, and by valuing common stock at the book value of
the capitalized surplus applicable thereto adjusted by the foregoing method of
valuing Minority Interests in preferred stock.



     “Realty” means all real property and interests therein, together with all
improvements thereon.



     “Securitization Transaction” means any financing transaction or series of
financing transactions that have been or may be entered into by a member of the
Consolidated Group pursuant to which such member of the Consolidated Group may
sell, convey or otherwise transfer to (i) a Subsidiary or affiliate (a
“Securitization Subsidiary”) or (ii) any other Person, or may grant a security
interest in, any Receivables or interest therein secured by merchandise or
services financed thereby (whether such Receivables are then existing or arising
in the future) of such member of the Consolidated Group, and any assets related
thereto, including without limitation, all security interests in merchandise or
services financed thereby, the proceeds of such Receivables, and other assets
which are customarily sold or in respect of which security interests are
customarily granted in connection with securitization transactions involving
such assets. (Receivables means any right of payment from or on behalf of any
obligor, whether constituting an account, chattel paper, instrument, general
intangible or otherwise, arising from the sale or financing by a member of the
Consolidated Group or merchandise or services, and monies due thereunder,
security in the merchandise and services financed thereby, records related
thereto, and the right to payment of any interest or finance charges and other
obligations with respect thereto, proceeds from claims on insurance policies
related thereto, any other proceeds related thereto, and any other related
rights.)



     “Tangible Fair Market Value of Assets” means, as of any date for the
Consolidated Group, the sum (without duplication) of (a) with respect to any
Realty owned by a member of the Consolidated Group and purchased or developed
prior to January 1 of the year preceding such date, (i) the sum of (A)
Consolidated Net Operating Income for Realty for the fiscal quarter most
recently ended prior to such date multiplied by four, minus (B) a reserve of
$250 per apartment unit, divided by (ii) 9.25%, plus (b) with respect to any
Realty owned by a member of the Consolidated Group and purchased or developed on
or after January 1 of the year preceding such date, the actual cost of such
Realty, plus (c) with respect to any Consolidated Unimproved Realty, the sum of
(i) one hundred percent (100%) of the GAAP value of the land associated with
such Realty plus (ii) an amount equal to 100% (100%) of the actual expenditures
for improvements on such Realty, plus (d) cash and Cash Equivalents, in each
case on a consolidated basis determined in accordance with GAAP applied on a
consistent basis, plus (e) one hundred (100%) of the Consolidated Group’s pro
rata share of the GAAP value of any asset contributed to or otherwise invested
in joint ventures.



     “Wholly Owned Subsidiary” means as to any person, any Subsidiary all of the
voting stock or other similar voting interest are owned directly or indirectly
by such Person. Unless otherwise provided, references to “Wholly Owned
Subsidiary” shall mean Wholly Owned Subsidiaries of the Borrower.



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SECTION 15.02 Compliance with Debt Service Coverage Ratios. The Borrower shall
at all times maintain the Aggregate Debt Service Coverage Ratio for
the Trailing 12 Month Period so that it is not less than 1.30:1.0.



SECTION 15.03 Compliance with Loan to Value Ratios. The Borrower shall at all
times maintain the Aggregate Loan to Value Ratio for the Trailing 12
Month Period so that it is not greater than 70%.



SECTION 15.04 Compliance with Concentration Test.




          (a) The Borrower shall at all times maintain the Collateral so that
the aggregate Valuations of any group of Mortgaged Properties located within a
one mile radius shall not exceed 30% of the aggregate Valuations of all
Mortgaged Properties.




          (b) The Borrower shall at all times maintain the Collateral so that
the Valuation of any one Mortgaged Property shall not exceed 30% of
the aggregate Valuations of all Mortgaged Properties.




          (c) The Borrower shall at all times maintain the Collateral so that
the Valuation of all Mortgaged Properties subject to review and underwriting
under Section 305.09 of the DUS Guide (Projection Dependent on Military Bases)
shall not exceed 20% of the aggregate Valuations of all Mortgaged Properties.
Notwithstanding the preceding sentence, Lender may reject, in its sole
discretion, any proposed Mortgaged Property subject to review and underwriting
under Section 305.09 of the DUS Guide.



SECTION 15.05 Consolidated Adjusted Tangible Net Worth. Consolidated Adjusted
Tangible Net Worth of UDRT will not at any time be less than the sum
of (i) $1,500,000,000 plus (ii) 90% of the net proceeds (after customary underwriting
discounts and commissions and reasonable offering expenses) from
Equity Transactions occurring after December 31, 1999.



SECTION 15.06 Consolidated Funded Debt Ratio. As of the last day of each fiscal
quarter Consolidated Funded Debt of UDRT shall not exceed 60% of
Tangible Fair Market Value of Assets.



SECTION 15.07 Consolidated Total Fixed Charge Coverage Ratio. As of the end of
each fiscal quarter, the ratio of Consolidated Adjusted EBITDA of UDRT to
Consolidated Total Fixed Charges for the fiscal quarter then ended shall be not
less than 1.4:1.0.



SECTION 15.08 Consolidated Unencumbered Realty to Consolidated Unsecured Debt
Ratio. As of the last day of each fiscal quarter, the ratio of Consolidated
Unsecured Debt of UDRT to Consolidated Unencumbered Realty of UDRT
shall not exceed 60%.



SECTION 15.09 Consolidated Unencumbered Interest Coverage Ratio. As of the end
of each fiscal quarter, the ratio of Consolidated Net Operating Income of UDRT
from Unencumbered Realty of UDRT to Consolidated Interest Expense relating to
Consolidated Unsecured Debt of UDRT for the fiscal quarter then ended shall not
be less than 1.75:1.0.




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ARTICLE XVI

FEES



SECTION 16.01 Standby Fee. The Borrower shall pay the Standby Fee to the Lender
for the period from the date of this Agreement to the end of the Term of this
Agreement. Notwithstanding the preceding sentence, the Standby Fee shall be
waived for the period commencing on the Initial Closing Date and ending on March
31, 2002. The Standby Fee shall be payable monthly, in arrears, on the first
Business Day following the end of the month, except that the Standby Fee for the
last month during the Term of this Agreement shall be paid on the
last day of the Term of this Agreement.



SECTION 16.02 Origination Fees.




               (a) Initial Origination Fee. The Borrower shall pay to the Lender
an origination fee (“Initial Origination Fee”) equal to $2,250,000 (which is
equal to the product obtained by multiplying (i) the Commitment as of the date
of this Agreement ($300,000,000), by (ii) .75%). The Borrower shall pay the
Initial Origination Fee on the date of this Agreement. $1,687,500 of the Initial
Origination Fee shall be paid on the Initial Closing Date. The remainder of the
Initial Original Fee ($562,500) shall be paid on the earlier of (i) the date
Advances exceed $225,000,000 (to the extent of such excess multiplied by .75%)
and (ii) March 31, 2002.



               (b) Expansion Origination Fee. Upon the closing of a Credit
Facility Expansion Request under Article VIII, the Borrower
shall pay to the Lender an origination fee (“Expansion Origination Fee”) equal to the product
obtained by multiplying (i) the increase in the Commitment made on the Closing
Date for the Credit Facility Expansion Request, by (ii) .75%. The Borrower shall
pay the Expansion Origination Fee on or before the Closing Date for the Credit
Facility Expansion Request.


SECTION 16.03 Due Diligence Fees.




               (a) Initial Due Diligence Fees. The Borrower shall pay to the
Lender due diligence fees (“Initial Due Diligence Fees”) with respect to the
Initial Mortgaged Properties in an amount equal to Lender’s reasonable actual
out of pocket due diligence costs and expenses plus $1,000 per Mortgaged
Property. The Borrower has previously paid to the Lender a portion of the
Initial Due Diligence Fees and shall pay the remainder of the Initial Due
Diligence Fees to the Lender on the Initial Closing Date.



               (b) Additional Due Diligence Fees for Additional Collateral. The
Borrower shall pay to the Lender additional due diligence fees (the “Additional
Collateral Due Diligence Fees”) with respect to each Additional Mortgaged
Property in an amount equal to Lender’s reasonable out of pocket due diligence
costs and expenses plus $2,500. The Borrower shall pay Additional Collateral Due
Diligence Fees for the Additional Mortgaged Property to the Lender on the date
on which it submits the Collateral Addition Request for the addition of the
Additional Mortgaged Property to the Collateral Pool.



     SECTION 16.04 Legal Fees and Expenses.



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          (a) Initial Legal Fees. The Borrower shall pay, or reimburse the
Lender for, all reasonable out of pocket legal fees and expenses incurred by the
Lender and by Fannie Mae in connection with the preparation, review and
negotiation of this Agreement and any other Loan Documents executed on the date
of this Agreement based on the terms set forth in a separate letter from the
Lender to the Borrower. On the date of this Agreement, the Borrower shall pay
all such legal fees and expenses not previously paid or for which funds have not
been previously provided.




          (b) Fees and Expenses Associated with Requests. The Borrower shall
pay, or reimburse the Lender for, all costs and expenses incurred by the Lender,
including the reasonable out of pocket legal fees and expenses incurred by the
Lender in connection with the preparation, review and negotiation of all
documents, instruments and certificates to be executed and delivered in
connection with each Request, the performance by the Lender of any of its
obligations with respect to the Request, the satisfaction of all conditions
precedent to the Borrower’s rights or the Lender’s obligations with respect to
the Request, and all transactions related to any of the foregoing, including the
cost of title insurance premiums and applicable recordation and transfer taxes
and charges and all other costs and expenses in connection with a Request. The
obligations of the Borrower under this subsection shall be absolute and
unconditional, regardless of whether the transaction requested in the Request
actually occurs. The Borrower shall pay such costs and expenses to the Lender on
the Closing Date for the Request, or, as the case may be, after demand by the
Lender when the Lender determines that such Request will not close.



SECTION 16.05 MBS Related Costs. The Borrower shall pay to the Lender, within 30
days after demand, all fees and expenses incurred by the Lender or
Fannie Mae in connection with the issuance of any MBS backed by an Advance, including the fees
charged by Depository Trust Company and State Street Bank or any
successor fiscal agent or custodian.



SECTION 16.06 Failure to Close any Request. If the Borrower makes a Request and
fails to close on the Request for any reason other than the default by the
Lender or, if applicable, the failure of the purchaser of an MBS to purchase
such MBS, then the Borrower shall pay to the Lender and Fannie Mae all damages
incurred by the Lender and Fannie Mae in connection with the failure to close.



SECTION 16.07 Other Fees. The Borrower shall pay the following additional fees
and payments, if and when required pursuant to the terms of this Agreement:




               (a) If applicable, the Collateral Addition Fee, pursuant to
Section 6.03(c), in connection with the addition of an
Additional Mortgaged Property to the Collateral Pool pursuant to Article VI;



               (b) The Release Price, pursuant to Section 7.02(c), in connection
with the release of a Mortgaged Property from the Collateral Pool
pursuant to Article VII;



               (c) The Facility Termination Fee, pursuant to Section 9.03(b) in
connection with a complete or partial termination of the Revolving
Facility pursuant to Article IX; and



               (d) The Facility Termination Fee, pursuant to Section 10.03(b), in
connection with the termination of the Credit Facility pursuant to Article X.



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ARTICLE XVII

EVENTS OF DEFAULT



SECTION 17.01 Events of Default. Each of the following events shall constitute
an “Event of Default” under this Agreement, whatever the reason for such event
and whether it shall be voluntary or involuntary, or within or without the
control of the Borrower, or be effected by operation of law or pursuant to any
judgment or order of any court or any order, rule or regulation of any
Governmental Authority:




          (a) the occurrence of a default under any Loan Document beyond the
cure period, if any, set forth therein; or




          (b) the failure by the Borrower to pay when due any amount payable by
the Borrower under any Note, any Mortgage, this Agreement or any
other Loan Document, including any fees, costs or expenses; or




          (c) the failure by the Borrower to perform or observe any covenant set
forth in Sections 13.01 through 13.25 or Sections 14.01 through 14.14 within
thirty (30) days after receipt of notice from Lender identifying such failure,
provided that such period shall be extended for up to forty five (45) additional
days if the Borrower, in the discretion of the Lender, is diligently pursuing a
cure of such default; or




          (d) any warranty, representation or other written statement made by or
on behalf of the Borrower contained in this Agreement, any other Loan Document
or in any instrument furnished in compliance with or in reference to any of the
foregoing, is false or misleading in any material respect on any date when made
or deemed made; or




          (e) any
other Indebtedness in an aggregate amount in excess of $5,000,000 of the Borrower or assumed by the Borrower (i) is not paid when due
nor within any applicable grace period in any agreement or instrument relating
to such Indebtedness or (ii) becomes due and payable before its normal maturity
by reason of a default or event of default, however described, or any other
event of default shall occur and continue after the applicable grace period, if
any, specified in the agreement or instrument relating to such Indebtedness; or




          (f) (i) The Borrower shall (A) commence a voluntary case under the
Federal bankruptcy laws (as now or hereafter in effect), (B) file a petition
seeking to take advantage of any other laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, debt adjustment, winding up or
composition or adjustment of debts, (C) consent to or fail to contest in a
timely and appropriate manner any petition filed against it in an involuntary
case under such bankruptcy laws or other laws, (D) apply for or consent to, or
fail to contest in a timely and appropriate manner, the appointment of, or the
taking of possession by, a receiver, custodian, trustee or liquidator of itself
or of a substantial part of its property, domestic or foreign, (E) admit in
writing its inability to pay, or generally not be paying, its debts as they
become due, (F) make a general assignment for the benefit of creditors, (G)
assert that the Borrower has no liability or obligations under this Agreement or
any other Loan Document to which it is a party; or (H) take any action for the
purpose of effecting any of the foregoing; or (ii) a case or other proceeding
shall be commenced against the Borrower in any court of competent jurisdiction
seeking (A) relief under the Federal bankruptcy laws (as now or





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hereafter in effect) or under any other laws, domestic or foreign, relating to
bankruptcy, insolvency, reorganization, winding upon or composition or
adjustment of debts, or (B) the appointment of a trustee, receiver, custodian,
liquidator or the like of the Borrower, or of all or a substantial part of the
property, domestic or foreign, of the Borrower and any such case or proceeding
shall continue undismissed or unstayed for a period of 60 consecutive calendar
days, or any order granting the relief requested in any such case or proceeding
against the Borrower (including an order for relief under such Federal
bankruptcy laws) shall be entered; or




          (g) if any provision of this Agreement or any other Loan Document or
the lien and security interest purported to be created hereunder or under any
Loan Document shall at any time for any reason cease to be valid and binding in
accordance with its terms on the Borrower, or shall be declared to be null and
void, or the validity or enforceability hereof or thereof or the validity or
priority of the lien and security interest created hereunder or under any other
Loan Document shall be contested by the Borrower seeking to establish the
invalidity or unenforceability hereof or thereof, or the Borrower shall deny
that it has any further liability or obligation hereunder or thereunder; or




          (h) (i) the execution by the Borrower without the prior written
consent of the Lender of a chattel mortgage or other security agreement on any
materials, fixtures or articles used in the construction or operation of the
improvements located on any Mortgaged Property or on articles of personal
property located therein, or (ii) if, without the prior written consent of the
Lender, any such materials, fixtures or articles are purchased pursuant to any
conditional sales contract or other security agreement or otherwise so that the
Ownership thereof will not vest unconditionally in the Borrower free from
encumbrances, or (iii) if the Borrower does not furnish to the Lender upon
request the contracts, bills of sale, statements, receipted vouchers and
agreements, or any of them, under which the Borrower claims title to such
materials, fixtures, or articles; or




          (i) the failure by the Borrower to comply with any requirement of any
Governmental Authority within 30 days after written notice of such requirement
shall have been given to the Borrower by such Governmental Authority; provided
that, if action is commenced and diligently pursued by the Borrower within such
30 days, then the Borrower shall have an additional 45 days to comply with such
requirement; or




          (j) a dissolution or liquidation for any reason (whether voluntary or
involuntary) of the Borrower; or




          (k) any judgment against the Borrower, any attachment or other levy
against any portion of the Borrower’s assets with respect to a claim or claims
in an amount in excess of $2,500,000 in the aggregate remains unpaid, unstayed
on appeal undischarged, unbonded, not fully insured or undismissed for a period
of 60 days; or




          (l) [Intentionally Deleted]




          (m) The failure of the Borrower to perform or observe any of the
Financial Covenants, which failure shall continue for a period of 30 days after
the date on which the Borrower receives a notice from the Lender specifying the
failure; or





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          (n) the failure by the Borrower to perform or observe any term,
covenant, condition or agreement hereunder, other than as set forth in
subsections (a) through (m) above, or in any other Loan Document, within 30 days
after receipt of notice from the Lender identifying such failure.




ARTICLE XVIII

REMEDIES



SECTION 18.01 Remedies; Waivers. Upon the occurrence of an Event of Default, the
Lender may do any one or more of the following (without presentment,
protest or notice of protest, all of which are expressly waived by the Borrower):




          (a) by written notice to the Borrower, to be effective upon dispatch,
terminate the Commitment and declare the principal of, and interest on, the
Advances and all other sums owing by the Borrower to the Lender under any of the
Loan Documents forthwith due and payable, whereupon the Commitment will
terminate and the principal of, and interest on, the Advances and all other sums
owing by the Borrower to the Lender under any of the Loan Documents will become
forthwith due and payable.




          (b) The Lender shall have the right to pursue any other remedies
available to it under any of the Loan Documents.




          (c) The Lender shall have the right to pursue all remedies available
to it at law or in equity, including obtaining specific performance
and injunctive relief.



SECTION 18.02 Waivers; Rescission of Declaration. The Lender shall have the
right, to be exercised in its complete discretion, to waive any breach hereunder
(including the occurrence of an Event of Default), by a writing setting forth
the terms, conditions, and extent of such waiver signed by the Lender and
delivered to the Borrower. Unless such writing expressly provides to the
contrary, any waiver so granted shall extend only to the specific event or
occurrence which gave rise to the waiver and not to any other similar event or
occurrence which occurs subsequent to the date of such waiver.



SECTION 18.03 The Lender’s Right to Protect Collateral and Perform Covenants and
Other Obligations. If the Borrower fails to perform the covenants and agreements
contained in this Agreement or any of the other Loan Documents, then the Lender
at the Lender’s option may make such appearances, disburse such sums and take
such action as the Lender deems necessary, in its sole discretion, to protect
the Lender’s interest, including (i) disbursement of attorneys’ fees, (ii) entry
upon the Mortgaged Property to make repairs and Replacements, (iii) procurement
of satisfactory insurance as provided in paragraph 5 of the Security Instrument
encumbering the Mortgaged Property, and (iv) if the Security Instrument is on a
leasehold, exercise of any option to renew or extend the ground lease on behalf
of the Borrower and the curing of any default of the Borrower in the terms and
conditions of the ground lease. Any amounts disbursed by the Lender pursuant to
this Section, with interest thereon, shall become additional indebtedness of the
Borrower secured by the Loan Documents. Unless the Borrower and the Lender agree
to other terms of payment, such amounts shall be immediately due and payable and
shall bear interest from the date of disbursement at the weighted average, as
determined by Lender, of the interest rates in effect





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from time to time for each Advance unless collection from the Borrower of
interest at such rate would be contrary to applicable law, in which event such
amounts shall bear interest at the highest rate which may be collected from the
Borrower under applicable law. Nothing contained in this Section shall require
the Lender to incur any expense or take any action hereunder.



SECTION 18.04 No Remedy Exclusive. Unless otherwise expressly provided, no
remedy herein conferred upon or reserved is intended to be exclusive of any
other available remedy, but each remedy shall be cumulative and shall be in
addition to other remedies given under the Loan Documents or existing at law or
in equity.



SECTION 18.05 No Waiver. No delay or omission to exercise any right or power
accruing under any Loan Document upon the happening of any Event of Default or
Potential Event of Default shall impair any such right or power or shall be
construed to be a waiver thereof, but any such right and power may be exercised
from time to time and as often as may be deemed expedient.



SECTION 18.06 No Notice. In order to entitle the Lender to exercise any remedy
reserved to the Lender in this Article, it shall not be necessary to give any
notice, other than such notice as may be required under the applicable
provisions of this Agreement or any of the other Loan Documents.



SECTION 18.07 Application of Payments. Except as otherwise expressly provided in
the Loan Documents, and unless applicable law provides otherwise, (i) all
payments received by the Lender from the Borrower under the Loan Documents shall
be applied by the Lender against any amounts then due and payable under the Loan
Documents by the Borrower, in any order of priority that the Lender may
determine and (ii) the Borrower shall have no right to determine the order of
priority or the allocation of any payment it makes to the Lender.




ARTICLE XIX

RIGHTS OF FANNIE MAE



SECTION 19.01 Special Pool Purchase Contract. The Borrower acknowledges that
Fannie Mae is entering into an agreement with the Lender (“Special Pool Purchase
Contract”), pursuant to which, inter alia, (i) the Lender shall agree to assign
all of its rights under this Agreement to Fannie Mae, (ii) Fannie Mae shall
accept the assignment of the rights, (iii) subject to the terms, limitations and
conditions set forth in the Special Pool Purchase Contract, Fannie Mae shall
agree to purchase a 100% participation interest in each Advance issued under
this Agreement by issuing to the Lender a Fannie Mae MBS, in the amount and for
a term equal to the Advance purchased and backed by an interest in the Base
Facility Note or the Revolving Facility Note, as the case may be, and the
Collateral Pool securing the Notes, (iv) the Lender shall agree to assign to
Fannie Mae all of the Lender’s interest in the Notes and Collateral Pool
securing the Notes, and (v) the Lender shall agree to service the loans
evidenced by the Notes.



SECTION 19.02 Assignment of Rights. The Borrower acknowledges and consents to
the assignment to Fannie Mae of all of the rights of the Lender under
this Agreement and all other Loan Documents, including the right and power to make
all decisions on the part of the Lender to be made under this Agreement and the
other Loan Documents, but Fannie Mae, by virtue of this assignment, shall not be
obligated to perform the obligations of the Lender under this Agreement or the
other Loan Documents.




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SECTION 19.03 Release of Collateral. The Borrower hereby acknowledges that,
after the assignment of Loan Documents contemplated in Section 19.02, the Lender
shall not have the right or power to effect a release of any Collateral pursuant
to Articles VII or X. The Borrower acknowledges that the Security Instruments
provide for the release of the Collateral under Articles VII and X. Accordingly,
the Borrower shall not look to the Lender for performance of any obligations set
forth in Articles VII and X, but shall look solely to the party secured by the
Collateral to be released for such performance. The Lender represents and
warrants to the Borrower that the party secured by the Collateral shall be
subject to the release and substitution provisions contained in Articles VII and
X by virtue of the release provisions in each Security Instrument.



SECTION 19.04 Replacement of Lender. At the request of Fannie Mae, the Borrower
and the Lender shall agree to the assumption by another lender designated by
Fannie Mae, of all of the obligations of the Lender under this Agreement and the
other Loan Documents, and/or any related servicing obligations, and, at Fannie
Mae’s option, the concurrent release of the Lender from its obligations under
this Agreement and the other Loan Documents, and/or any related servicing
obligations, and shall execute all releases, modifications and other documents
which Fannie Mae determines are necessary or desirable to effect such
assumption.



SECTION 19.05 Fannie Mae and Lender Fees and Expenses. The Borrower agrees that
any provision providing for the payment of fees, costs or expenses incurred or
charged by the Lender pursuant to this Agreement shall be deemed to provide for
the Borrower’s payment of all reasonable fees, costs and expenses incurred or
charged by the Lender or Fannie Mae in connection with the matter for which
fees, costs or expenses are payable.



SECTION 19.06 Third Party Beneficiary. The Borrower hereby acknowledges and
agrees that Fannie Mae is a third party beneficiary of all of the
representations, warranties and covenants made by the Borrower to, and all
rights under this Agreement conferred upon, the Lender, and, by virtue of its
status as third party beneficiary and/or assignee of the Lender’s rights under
this Agreement, Fannie Mae shall have the right to enforce all of the provisions
of this Agreement against the Borrower.




ARTICLE XX

INSURANCE, REAL ESTATE TAXES

AND REPLACEMENT RESERVES



SECTION 20.01 Insurance and Real Estate Taxes. The Borrower shall (unless waived
by Lender) establish funds for taxes, insurance premiums and certain other
charges for each Mortgaged Property in accordance with Section 7(a) of the
Security Instrument for each Mortgaged Property. The Borrower may provide a
letter of credit in lieu of deposits required by the preceding sentence. Any
letter of credit provided by the Borrower shall be (i) issued by a financial
institution reasonably acceptable to the Lender, (ii) be an amount reasonably
deferred, from time to time by the Lender and, (iii) in a form reasonably
satisfactory to Lender.



SECTION 20.02 Replacement Reserves. The Borrower shall execute a Replacement
Reserve Agreement for the Mortgaged Property which it owns and shall
(unless waived by the Lender) make





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all
deposits for replacement reserves in accordance with the terms of the Replacement Reserve Agreement.




ARTICLE XXI

INTENTIONALLY OMITTED




ARTICLE XXII

PERSONAL LIABILITY OF THE BORROWER



SECTION 22.01 Personal Liability of the Borrower.




          (a) Full Recourse. The Borrower is and shall remain personally liable
to the Lender for the payment and performance of all Obligations
throughout the term of this Agreement.




          (b) Transfer Not Release. No Transfer by any Person of its Ownership
Interests in the Borrower shall release the Borrower from liability under this
Article, this Agreement or any other Loan Document, unless the Lender shall have
approved the Transfer and shall have expressly released the Borrower in
connection with the Transfer.




          (c) Miscellaneous. The Lender may exercise its rights against the
Borrower personally without regard to whether the Lender has exercised any
rights against the Mortgaged Property or any other security, or pursued any
rights against any guarantor, or pursued any other rights available to the
Lender under the Loan Documents or applicable law. For purposes of this Article,
the term “Mortgaged Property” shall not include any funds that (1) have been
applied by the Borrower as required or permitted by the Loan Documents prior to
the occurrence of an Event of Default, or (2) are owned by the Borrower and
which the Borrower was unable to apply as required or permitted by the Loan
Documents because of a bankruptcy, receivership, or similar judicial proceeding.




ARTICLE XXIII

MISCELLANEOUS PROVISIONS



SECTION 23.01 Counterparts. To facilitate execution, this Agreement may be
executed in any number of counterparts. It shall not be necessary that the
signatures of, or on behalf of, each party, or that the signatures of all
persons required to bind any party, appear on each counterpart, but it shall be
sufficient that the signature of, or on behalf of, each party, appear on one or
more counterparts. All counterparts shall collectively constitute a single
agreement. It shall not be necessary in making proof of this Agreement to
produce or account for more than the number of counterparts containing the
respective signatures of, or on behalf of, all of the parties hereto.



SECTION 23.02 Amendments, Changes and Modifications. This Agreement may be
amended, changed, modified, altered or terminated only by written
instrument or written instruments signed by all of the parties hereto.




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SECTION 23.03 Payment of Costs, Fees and Expenses. The Borrower shall pay, on
demand, all reasonable fees, costs, charges or expenses (including the fees and
expenses of attorneys, accountants and other experts) incurred by the Lender in
connection with:




          (a) Any amendment, consent or waiver to this Agreement or any of the
Loan Documents (whether or not any such amendments, consents or
waivers are entered into).




          (b) Defending or participating in any litigation arising from actions
by third parties and brought against or involving the Lender with respect to (i)
any Mortgaged Property, (ii) any event, act, condition or circumstance in
connection with any Mortgaged Property or (iii) the relationship between the
Lender and the Borrower in connection with this Agreement or any of the
transactions contemplated by this Agreement.




          (c) The administration (to the extent of actual out of pocket fees,
costs, charges or expenses) or enforcement of, or preservation of rights or
remedies under, this Agreement or any other Loan Documents or in connection with
the foreclosure upon, sale of or other disposition of any Collateral granted
pursuant to the Loan Documents.




          (d) UDRT’s Registration Statement, or similar disclosure documents,
including fees payable to any rating agencies, including the fees and
expenses of the Lender’s attorneys and accountants.



The Borrower shall also pay, on demand, any transfer taxes, documentary taxes,
assessments or charges made by any governmental authority by reason of the
execution, delivery, filing, recordation, performance or enforcement of any of
the Loan Documents or the Advances. However, the Borrower will not be obligated
to pay any franchise, estate, inheritance, income, excess profits or similar tax
on the Lender. Any attorneys’ fees and expenses payable by the Borrower pursuant
to this Section shall be recoverable separately from and in addition to any
other amount included in such judgment, and such obligation is intended to be
severable from the other provisions of this Agreement and to survive and not be
merged into any such judgment. Any amounts payable by the Borrower pursuant to
this Section, with interest thereon if not paid when due, shall become
additional indebtedness of the Borrower secured by the Loan Documents. Such
amounts shall bear interest from the date such amounts are due until paid in
full at the weighted average, as determined by Lender, of the interest rates in
effect from time to time for each Advance unless collection from the Borrower of
interest at such rate would be contrary to applicable law, in which event such
amounts shall bear interest at the highest rate which may be collected from the
Borrower under applicable law. The provisions of this Section are cumulative
with, and do not exclude the application and benefit to the Lender of, any
provision of any other Loan Document relating to any of the matters covered by
this Section.



SECTION 23.04 Payment Procedure. All payments to be made to the Lender pursuant
to this Agreement or any of the Loan Documents shall be made in lawful currency
of the United States of America and in immediately available funds by wire
transfer to an account designated by the Lender before 1:00 p.m. (Washington,
D.C. time) on the date when due.



SECTION 23.05 Payments on Business Days. In any case in which the date of
payment to the Lender or the expiration of any time period hereunder
occurs on a day which is not a Business Day,




- 79 -









 




then such payment or expiration of such time period need not occur on such date
but may be made on the next succeeding Business Day with the same force and
effect as if made on the day of maturity or expiration of such period, except
that interest shall continue to accrue for the period after such date to the
next Business Day.



SECTION 23.06 Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial.
NOTWITHSTANDING ANYTHING IN THE NOTES, THE SECURITY DOCUMENTS OR ANY OF THE
OTHER LOAN DOCUMENTS TO THE CONTRARY, EACH OF THE TERMS AND PROVISIONS, AND
RIGHTS AND OBLIGATIONS OF THE BORROWER UNDER THE NOTES, AND THE BORROWER UNDER
THE OTHER LOAN DOCUMENTS, SHALL BE GOVERNED BY, INTERPRETED, CONSTRUED AND
ENFORCED PURSUANT TO AND IN ACCORDANCE WITH THE LAWS OF VIRGINIA (EXCLUDING THE
LAW APPLICABLE TO CONFLICTS OR CHOICE OF LAW) EXCEPT TO THE EXTENT OF PROCEDURAL
AND SUBSTANTIVE MATTERS RELATING ONLY TO (1) THE CREATION, PERFECTION AND
FORECLOSURE OF LIENS AND SECURITY INTERESTS, AND ENFORCEMENT OF THE RIGHTS AND
REMEDIES, AGAINST THE MORTGAGED PROPERTIES, WHICH MATTERS SHALL BE GOVERNED BY
THE LAWS OF THE JURISDICTION IN WHICH THE MORTGAGED PROPERTY IS LOCATED UNLESS
SPECIFICALLY SET FORTH OTHERWISE IN THE RELEVANT SECURITY INSTRUMENT, (2) THE
PERFECTION, THE EFFECT OF PERFECTION AND NON PERFECTION AND FORECLOSURE OF
SECURITY INTERESTS ON PERSONAL PROPERTY (OTHER THAN DEPOSIT ACCOUNTS), WHICH
MATTERS SHALL BE GOVERNED BY THE LAWS OF THE JURISDICTION DETERMINED BY THE
CHOICE OF LAW PROVISIONS OF THE VIRGINIA UNIFORM COMMERCIAL CODE AND (3) THE
PERFECTION, THE EFFECT OF PERFECTION AND NON PERFECTION AND FORECLOSURE OF
DEPOSIT ACCOUNTS, WHICH MATTERS SHALL BE GOVERNED BY THE LAWS OF THE
JURISDICTION IN WHICH THE DEPOSIT ACCOUNT IS LOCATED. THE BORROWER AGREES THAT
ANY CONTROVERSY ARISING UNDER OR IN RELATION TO THE NOTES, THE SECURITY
DOCUMENTS OR ANY OTHER LOAN DOCUMENT SHALL BE, EXCEPT AS OTHERWISE PROVIDED
HEREIN, LITIGATED IN VIRGINIA. THE LOCAL AND FEDERAL COURTS AND AUTHORITIES WITH
JURISDICTION IN VIRGINIA SHALL, EXCEPT AS OTHERWISE PROVIDED HEREIN, HAVE
JURISDICTION OVER ALL CONTROVERSIES WHICH MAY ARISE UNDER OR IN RELATION TO THE
LOAN DOCUMENTS, INCLUDING THOSE CONTROVERSIES RELATING TO THE EXECUTION,
JURISDICTION, BREACH, ENFORCEMENT OR COMPLIANCE WITH THE NOTES, THE SECURITY
DOCUMENTS OR ANY OTHER ISSUE ARISING UNDER, RELATING TO, OR IN CONNECTION WITH
ANY OF THE LOAN DOCUMENTS. THE BORROWER IRREVOCABLY CONSENTS TO SERVICE,
JURISDICTION, AND VENUE OF SUCH COURTS FOR ANY LITIGATION ARISING FROM THE
NOTES, THE SECURITY DOCUMENTS OR ANY OF THE OTHER LOAN DOCUMENTS, AND WAIVES ANY
OTHER VENUE TO WHICH IT MIGHT BE ENTITLED BY VIRTUE OF DOMICILE, HABITUAL
RESIDENCE OR OTHERWISE. NOTHING CONTAINED HEREIN, HOWEVER, SHALL PREVENT THE
LENDER FROM BRINGING ANY SUIT, ACTION OR PROCEEDING OR EXERCISING ANY RIGHTS
AGAINST THE BORROWER AND AGAINST THE COLLATERAL IN ANY OTHER JURISDICTION.
INITIATING SUCH SUIT, ACTION OR PROCEEDING OR TAKING SUCH ACTION IN ANY OTHER
JURISDICTION SHALL IN NO EVENT CONSTITUTE A WAIVER OF THE AGREEMENT CONTAINED
HEREIN THAT THE LAWS OF VIRGINIA SHALL





- 80 -









 







GOVERN THE RIGHTS AND OBLIGATIONS OF THE BORROWER AND THE LENDER AS PROVIDED
HEREIN OR THE SUBMISSION HEREIN BY THE BORROWER TO PERSONAL JURISDICTION WITHIN
VIRGINIA. THE BORROWER (I) COVENANTS AND AGREES NOT TO ELECT A TRIAL BY JURY
WITH RESPECT TO ANY ISSUE ARISING UNDER ANY OF THE LOAN DOCUMENTS TRIABLE BY A
JURY AND (II) WAIVES ANY RIGHT TO TRIAL BY JURY TO THE EXTENT THAT ANY SUCH
RIGHT SHALL NOW OR HEREAFTER EXIST. THIS WAIVER IS INTENDED TO ENCOMPASS
INDIVIDUALLY EACH INSTANCE AND EACH ISSUE AS TO WHICH THE RIGHT TO A JURY TRIAL
WOULD OTHERWISE ACCRUE. FURTHER, THE BORROWER HEREBY CERTIFIES THAT NO
REPRESENTATIVE OR AGENT OF LENDER (INCLUDING, BUT NOT LIMITED TO, LENDER’S
COUNSEL) HAS REPRESENTED, EXPRESSLY OR OTHERWISE, TO THE BORROWER THAT LENDER
WILL NOT SEEK TO ENFORCE THE PROVISIONS OF THIS SECTION. THE FOREGOING
PROVISIONS WERE KNOWINGLY, WILLINGLY AND VOLUNTARILY AGREED TO BY THE BORROWER
UPON CONSULTATION WITH INDEPENDENT LEGAL COUNSEL SELECTED BY THE BORROWER’S FREE
WILL.



SECTION 23.07 Severability. In the event any provision of this Agreement or in
any other Loan Document shall be held invalid, illegal or unenforceable in any
jurisdiction, such provision will be severable from the remainder hereof as to
such jurisdiction and the validity, legality and enforceability of the remaining
provisions will not in any way be affected or impaired in any jurisdiction.



SECTION 23.08 Notices.




               (a) Manner
of Giving Notice. Each notice, direction, certificate or other communication hereunder (in this Section referred to
collectively as “notices” and singly as a “notice”) which any
party is required
or permitted to give to the other party pursuant to this Agreement shall be in
writing and shall be deemed to have been duly and sufficiently given if:




                  (1) personally delivered with proof of delivery thereof
(any notice so delivered shall be deemed to have been received at the
time so delivered);




                  (2) sent by Federal Express (or other similar overnight
courier) designating morning delivery (any notice so delivered shall be
deemed to have been received on the Business Day it is delivered by the
courier);




                  (3) sent by United States registered or certified mail,
return receipt requested, postage prepaid, at a post office regularly
maintained by the United States Postal Service (any notice so sent
shall be deemed to have been received on the Business Day it is
delivered); or




                  (4) sent by telecopier or facsimile machine which
automatically generates a transmission report that states the date and
time of the transmission, the length of the document transmitted, and
the telephone number of the recipient’s telecopier or facsimile machine
(to be confirmed with a copy thereof sent in accordance with paragraphs
(1), (2) or (3) above within two Business Days) (any notice so
delivered shall be deemed to have been received (i) on the date of
transmission, if so transmitted before 5:00 p.m. (local time of the



- 81 -









 






recipient) on a Business Day, or (ii) on the next Business Day, if so
transmitted on or after 5:00 p.m. (local time of the recipient) on a
Business Day or if transmitted on a day other than a Business Day);
addressed to the parties as follows:


As to [any] Borrower:



c/o United Dominion Realty Trust, Inc.

1745 Shea Center Drive

Fourth Floor

Highlands Ranch, Colorado 80126

Attention: Ella S. Neyland

Telecopy No.: (720) 344 5110



with a copy to:



c/o United Dominion Realty Trust, Inc.

1745 Shea Center Drive

Fourth Floor

Highlands Ranch, Colorado 80126

Attention: Rod Neuheardt

Telecopy No.: (720) 344 5110



with a copy to:



Hirschler, Fleischer, Weinberg, Cox & Allen

701 East Byrd Street

Richmond, Virginia 23219

Attention: Michael H. Terry, Esq.

Telecopy No.: (804) 644 0957



As to the Lender:



ARCS Commercial Mortgage Co., L.P.

144 2/nd/ Avenue North

Suite 333

Nashville, Tennessee 37201

Attention: Joseph H. Torrence

Telecopy No.: (615) 256 5085



with a copy to:



ARCS Commercial Mortgage

26901 Agoura Road, #200

Calabasas, California 91301

Attn: Loan Administration Dept.





- 82 -









 







As to Fannie Mae:



Fannie Mae

3939 Wisconsin Avenue, N.W.

Washington, D.C. 20016 2899

Attention: Vice President for

Multifamily Asset Management

Telecopy No.: (202) 752 5016



with a copy to:



Arter & Hadden LLP

1801 K Street, N.W.

Third Floor, L Street Entrance

Washington, D.C. 200006

Attention: Lawrence H. Gesner, Esq.

Telecopy No.: (202) 857 0172




          (b) Change of Notice Address. Any party may, by notice given
pursuant to this Section, change the person or persons and/or address or
addresses, or designate an additional person or persons or an additional address
or addresses, for its notices, but notice of a change of address shall only be
effective upon receipt. Each party agrees that it shall not refuse or reject
delivery of any notice given hereunder, that it shall acknowledge, in writing,
receipt of the same upon request by the other party and that any notice rejected
or refused by it shall be deemed for all purposes of this Agreement to have been
received by the rejecting party on the date so refused or rejected, as
conclusively established by the records of the U.S. Postal Service, the courier
service or facsimile.


SECTION 23.09 Further Assurances and Corrective Instruments.




          (a) Further Assurances. To the extent permitted by law, the
parties hereto agree that they shall, from time to time, execute, acknowledge
and deliver, or cause to be executed, acknowledged and delivered, such
supplements hereto and such further instruments as the Lender or the Borrower
may request and as may be required in the opinion of the Lender or its counsel
to effectuate the intention of or facilitate the performance of this Agreement
or any Loan Document.



          (b) Further Documentation. Without limiting the generality of
subsection (a), in the event any further documentation or information is
required by the Lender to correct patent mistakes in the Loan Documents,
materials relating to the Title Insurance Policies or the funding of the
Advances, the Borrower shall provide, or cause to be provided to the Lender, at
its cost and expense, such documentation or information. The Borrower shall
execute and deliver to the Lender such documentation, including any amendments,
corrections, deletions or additions to the Notes, the Security Instruments or
the other Loan Documents as is required by the Lender.



          (c) Compliance with Investor Requirements. Without limiting the
generality of subsection (a), the Borrower shall do anything reasonably
necessary to comply with the requirements of the Lender in order to enable the
Lender to sell the MBS backed by an Advance.



- 83 -









 




SECTION 23.10 Term of this Agreement. This Agreement shall continue in effect
until the Credit Facility Termination Date.



SECTION 23.11 Assignments; Third Party Rights. The Borrower shall not assign
this Agreement, or delegate any of its obligations hereunder, without the prior
written consent of the Lender. The Lender may assign its rights and obligations
under this Agreement separately or together, without the Borrower’s consent,
only to Fannie Mae, but may not delegate its obligations under this Agreement
unless required to do so pursuant to Section 19.04.



SECTION 23.12 Headings. Article and Section headings used herein are for
convenience of reference only, are not part of this Agreement and are not to
affect the construction of, or to be taken into consideration in interpreting,
this Agreement.



SECTION 23.13 General Interpretive Principles. For purposes of this Agreement,
except as otherwise expressly provided or unless the context otherwise requires,
(i) the terms defined in Article I, Section 15.01, Section 16.01 and elsewhere
in this Agreement have the meanings assigned to them in this Agreement and
include the plural as well as the singular, and the use of any gender herein
shall be deemed to include the other genders; (ii) accounting terms not
otherwise defined herein have the meanings assigned to them in accordance with
GAAP; (iii) references herein to “Articles,” “Sections,”
“subsections,”
“paragraphs” and other subdivisions without reference to a document are to
designated Articles, Sections, subsections, paragraphs and other subdivisions of
this Agreement; (iv) a reference to a subsection without further reference to a
Section is a reference to such subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to paragraphs and
other subdivisions; (v) a reference to an Exhibit or a Schedule without a
further reference to the document to which the Exhibit or Schedule is attached
is a reference to an Exhibit or Schedule to this Agreement; (vi) the words
“herein,” “hereof,” “hereunder” and other
words of similar import refer to this
Agreement as a whole and not to any particular provision; and (vii) the word
“including” means “including, but not limited to.”



SECTION 23.14 Interpretation. The parties hereto acknowledge that each party
and their respective counsel have participated in the drafting and revision of
this Agreement and the Loan Documents. Accordingly, the parties agree that any
rule of construction which disfavors the drafting party shall not apply in the
interpretation of this Agreement and the Loan Documents or any amendment or
supplement or exhibit hereto or thereto.



SECTION 23.15 Decisions in Writing. Any approval, designation, determination,
selection, action or decision of the Lender must be in writing to be effective.



SECTION 23.16 Requests. The Borrower may make up to a total of four (4)
Collateral Addition Requests, Collateral Release Requests and Collateral
Substitution Requests in each Loan Year, provided that any Collateral Addition
Requests closed by March 31, 2002 shall not count against such limit. In
addition, the Borrower may make up to four (4) additional Collateral Addition
Requests, Collateral Release Requests and Collateral Substitution Requests in
each Loan Year upon payment of a fee, in addition to any fee due in connection
with the subject Request, equal to the greater of (i) $10,000 and (ii) 25 basis
points multiplied by the Allocable Facility Amount of the Mortgaged Property
that is the subject of the Request.




- 84 -









 





          IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.




	 	 	 	 	 
	 	 	BORROWER
	 
	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a

Virginia corporation
	 
	 	 	 	 
	 

	 	By:	 	/s/ Ella S. Neyland
	 

	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland
	 

	 	Title:
	 	Executive Vice President and Treasurer






	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P.,
a California limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a

Virginia limited partnership, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:	 	/s/ Ella S. Neyland
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer






- 85 -









 





	 	 	 	 	 	 	 
	 	 	LENDER
	 
	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a

California limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty, Inc., a California

Corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Kathy Millhouse
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Kathy Millhouse
	 

	 	 	 	Title:
	 	Senior Vice President







- 86 -










 





FIRST AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS FIRST AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as
of the 14th day of January, 2002 by (i) (a) UNITED DOMINION REALTY TRUST, INC., a Virginia
corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) HERITAGE – ASPEN COURT L.P., an Arizona limited partnership (“Aspen”),
(d) SOUTH WEST PROPERTIES, L.P., a Delaware limited partnership (“South West”), (e) AAC/FSC
CROWN POINTE INVESTORS, LLC, a Washington limited liability company (“Crown Pointe”), (f)
HERITAGE – GENTRY PLACE L.P., an Arizona limited partnership (“Gentry Derby”), (g) AAC/FSC
HILLTOP INVESTORS, LLC, a Washington limited liability company (“Hilltop”), (h) UNITED
DOMINION REALTY, L.P., a Virginia limited partnership (“UDR”), (i) HERITAGE – SMITH SUMMIT
L.P., an Arizona limited partnership (“Smith Summit”), (j) UDR SUMMIT RIDGE, L.P., a
Delaware limited partnership (“Summit Ridge”), (k) UDRT OF NORTH CAROLINA, L.L.C., a North
Carolina limited liability company (“UDRT-NC”) (individually and collectively, Aspen, South
West, Crown Pointe, Gentry Place, Hilltop, UDR, Smith Summit, Summit Ridge and UDRT-NC,
“Additional Borrower”) (individually and collectively, Original Borrower and Additional
Borrower, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited
partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(the “Master Agreement”) Original Borrower and Lender agreed to the terms and conditions
under which Lender would establish a credit facility in the original amount of $300,000,000 and
make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of even date
herewith, each Additional Borrower joined into the Master Agreement as if they were each an
Original Borrower.



     C. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     D. The parties are executing this Amendment pursuant to the Master Agreement to reflect the
addition of nine (9) Mortgaged Properties commonly known as Aspen Court owed by Aspen, Braesridge
owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by Gentry Derby, Hilltop
owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit, Summit Ridge owned by
Summit Ridge, and Village at Cliffdale owned by UDRT-NC, to the Collateral Pool.



 









 





     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 1. Addition of Mortgaged Property. The Mortgaged Properties commonly known as
Aspen Court, Braesridge, Crown Pointe, Derby Park, Hilltop, Riverwood, The Summit, Summit Ridge,
and Village at Cliffdale are hereby added to the Collateral Pool under the Master Agreement.



     Section 2. Exhibit A. Exhibit A to the Master Agreement is hereby deleted and
replaced with the Exhibit A attached to this Amendment.



     Section 3. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 4. Full Force and Effect. Except as expressly modified by this Amendment, all
terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 5. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 6. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




2









 









     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year
first above written.



BORROWER




	 	 	 	 	 
	UNITED DOMINION REALTY TRUST, INC., a Virginia corporation	 	 
	 
	 	 	 	 
	By: 

Name:

	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	Title:

	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 	 	 
	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P., a Virginia limited partnership,
its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Virginia
corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 
	HERITAGE – ASPEN COURT L.P.,	 	 
	an Arizona limited partnership	 	 
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




3









 









	 	 	 	 	 	 	 	 	 	 	 
	SOUTH WEST PROPERTIES, L.P.,	 	 
	a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	UDR HOLDINGS, LLC, a Virginia limited liability	 	 
	 	 	company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	 	 	a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 	 	 	 	 
	AAC/FSC CROWN POINTE INVESTORS, LLC,	 	 
	a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware limited	 	 
	 	 	liability company, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	 	 	a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 
	HERITAGE – GENTRY PLACE L.P.,	 	 
	an Arizona limited partnership	 	 
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




4









 








	 	 	 	 	 	 	 	 	 	 	 
	AAC/FSC HILLTOP INVESTORS, LLC,	 	 
	a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware	 	 
	 	 	limited liability company, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	 	 	a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:

	 	/s/ Ella S. Neyland
 

Ella S. Neyland

	 	 
	 

	 	 	 	 	 	
Title :

	 	


Executive Vice President and Treasurer
	 	 






	 	 	 	 	 	 	 
	UNITED DOMINION REALTY, L.P.,	 	 
	a Virginia limited partnership, Sole Member	 	 
	 
	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	a Virginia corporation, General Partner
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 
	HERITAGE – SMITH SUMMIT L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




5









 








	 	 	 	 	 	 	 
	UDR SUMMIT RIDGE, L.P.,	 	 
	a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 
	By:	 	SOUTH WEST REIT HOLDING, INC.
	 	 	a Texas corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






	 	 	 	 	 	 	 	 	 
	UDRT OF NORTH CAROLINA, L.L.C.,	 	 
	a North Carolina limited liability company	 	 
	 
	 	 	 	 	 	 	 	 
	By:	 	UDR of NC, Limited Partnership,	 	 
	 	 	a North Carolina limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR of North Carolina, Inc.	 	 
	 	 	 	 	a North Carolina corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




6









 








LENDER




ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership




	 	 	 	 	 	 	 
	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Kathy Millhouse
 

Kathy Millhouse
	 	 
	 

	 	Title:
	 	Senior Vice President	 	 






7









 






EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	 
	 	200 Bicentennial Circle	 	 
	Woodlake Village
	 	Sacramento, CA  95826	 	$44,800,000
	 
	 	 	 	 
	 
	 	2305 Ashcroft	 	 
	Aspen Court
	 	Arlington, TX  76006	 	$5,700,000
	 
	 	 	 	 
	 
	 	11100 Braesridge	 	 
	Braesridge
	 	Houston, TX  77071	 	$14,650,00
	 
	 	 	 	 
	 
	 	3788 NE 4th Street	 	 
	Crown Pointe
	 	Renton, WA  98056	 	$11,900,000
	 
	 	 	 	 
	 
	 	606 W. Safari Parkway	 	 
	Derby Park
	 	Grand Prairie, TX  75050	 	$15,900,000
	 
	 	 	 	 
	 
	 	500 Monroe Avenue NE	 	 
	Hilltop
	 	Renton, WA  98056	 	$11,000,000
	 
	 	 	 	 
	 
	 	1045 Holcomb Bridge Road	 	 
	Riverwood
	 	Roswell, GA  30076	 	$16,750,000
	 
	 	 	 	 
	 
	 	1057 Americana Lane	 	 
	The Summit
	 	Mesquite, TX  75150	 	$12,250,000
	 
	 	 	 	 
	 
	 	1604 Ridge Haven Drive	 	 
	Summit Ridge
	 	Arlington, TX  76011	 	$11,000,000
	 
	 	 	 	 
	 
	 	567 Cutchen Lane	 	 
	Village at Cliffdale
	 	Fayetteville, NC  28314	 	$16,500,000








A-1









 








SECOND AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS SECOND AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made
as of the 24th day of January, 2002 by (i) (a) UNITED DOMINION REALTY TRUST, INC., a Virginia
corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) HERITAGE – ASPEN COURT L.P., an Arizona limited partnership (“Aspen”),
(d) SOUTH WEST PROPERTIES, L.P., a Delaware limited partnership (“South West”), (e) AAC/FSC
CROWN POINTE INVESTORS, LLC, a Washington limited liability company (“Crown Pointe”), (f)
HERITAGE – GENTRY PLACE L.P., an Arizona limited partnership (“Gentry Derby”), (g) AAC/FSC
HILLTOP INVESTORS, LLC, a Washington limited liability company (“Hilltop”), (h) UNITED
DOMINION REALTY, L.P., a Virginia limited partnership (“UDR”), (i) HERITAGE – SMITH SUMMIT
L.P., an Arizona limited partnership (“Smith Summit”), (j) UDR SUMMIT RIDGE, L.P., a
Delaware limited partnership (“Summit Ridge”), (k) UDRT OF NORTH CAROLINA, L.L.C., a North
Carolina limited liability company (“UDRT-NC”) (individually and collectively, Aspen, South
West, Crown Pointe, Gentry Place, Hilltop, UDR, Smith Summit, Summit Ridge and UDRT-NC, “First
Additional Borrower”), (l) UDR BEAUMONT, LLC, a Virginia limited liability company
(“Beaumont”), (m) HERITAGE – CHELSEA PARK L.P., an Arizona limited partnership
(“Chelsea”), (n) HERITAGE – COUNTRY CLUB PLACE L.P., an Arizona limited partnership
(“Country Club”), and (o) CONTEMPO HEIGHTS L.L.C., an Arizona limited liability company
(“Contempo Stonegate”) (individually and collectively, Beaumont, Chelsea, Country Club and
Contempo Stonegate, “Second Additional Borrower”) (individually and collectively, Original
Borrower, First Additional Borrower, and Second Additional Borrower, “Borrower”) and (ii)
ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(the “Master Agreement”) Original Borrower and Lender agreed to the terms and conditions
under which Lender would establish a credit facility in the original amount of $300,000,000 and
make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, each First Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Original Borrower and First Additional Borrower added nine (9) Mortgaged
Properties commonly known as Aspen Court owned by Aspen, Braesridge owned by South West, Crown
Pointe owned by Crown Pointe, Derby Park owned by Gentry Derby, Hilltop owned by Hilltop, Riverwood
owned by UDR, The Summit owned by Smith Summit, Summit Ridge owned by Summit Ridge, and Village at
Cliffdale owned by UDRT-NC, to the Collateral Pool.













 





     D. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     E. The parties are executing this Amendment to the Master Agreement to reflect the addition of
six (6) Mortgaged Properties commonly known as Beaumont owned by Beaumont, Chelsea Park owned by
Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe owned by UDRT, Stonegate owned
by Contempo Stonegate, and Trinity Park owned by UDRT-NC, to the Collateral Pool.



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 1. Addition of Mortgaged Property. The Mortgaged Properties commonly known as
Beaumont, Chelsea Park, Country Club Place, Dunwoody Pointe, Stonegate and Trinity Park are hereby
added to the Collateral Pool under the Master Agreement.



     Section 2. Exhibit A. Exhibit A to the Master Agreement is hereby deleted and
replaced with the Exhibit A attached to this Amendment.



     Section 3. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 4. Full Force and Effect. Except as expressly modified by this Amendment, all
terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 5. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 6. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]





2









 





     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and
year first above written.



BORROWER




UNITED DOMINION REALTY TRUST, INC., a Virginia corporation




	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Ella S. Neyland  
	 	 	 	 	 
	Name:	 	Ella S. Neyland
	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 
	WOODLAKE VILLAGE, L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P., a Virginia limited partnership,
	 	 	its General Partner  
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Virginia
	 	 	 	 	corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	HERITAGE – ASPEN COURT L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer






[Signatures Continue]




3









 








	 	 	 	 	 	 	 	 	 	 	 
	SOUTH WEST PROPERTIES, L.P.,
	a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	UDR HOLDINGS, LLC, a Virginia limited liability
	 	 	company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia
	 	 	 	 	limited partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	AAC/FSC CROWN POINTE INVESTORS, LLC,
	a Washington limited liability company
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware limited
	 	 	liability company, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia
	 	 	 	 	limited partnership, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	HERITAGE – GENTRY PLACE L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer






[Signatures Continue]




4









 








	 	 	 	 	 	 	 	 	 	 	 
	AAC/FSC HILLTOP INVESTORS, LLC,
	a Washington limited liability company
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware
	 	 	limited liability company, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia
	 	 	 	 	limited partnership, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	UNITED DOMINION REALTY, L.P.,
	a Virginia limited partnership, Sole Member
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	a Virginia corporation, General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 	 	 
	HERITAGE – SMITH SUMMIT L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer






[Signatures Continue]





5









 








	 	 	 	 	 	 	 	 	 
	UDR SUMMIT RIDGE, L.P.,
	a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	SOUTH WEST REIT HOLDING, INC.
	 	 	a Texas corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 
	UDRT OF NORTH CAROLINA, L.L.C.,
	a North Carolina limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	UDR OF NC, Limited Partnership,
	 	 	a North Carolina limited partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR OF NORTH CAROLINA, INC.,
	 	 	 	 	a North Carolina corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	UDR BEAUMONT, LLC,
	a Virginia limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE COMMUNITIES L.P.,
	 	 	a Delaware limited partnership, its Manager
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR INVESTMENTS CORPORATION,
	 	 	 	 	a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




6









 








	 	 	 	 	 	 	 
	HERITAGE – CHELSEA PARK L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	HERITAGE – COUNTRY CLUB PLACE L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 

	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	CONTEMPO HEIGHTS L.L.C.,
	an Arizona limited liability company
	 
	 	 	 	 	 	 
	By:	 	ASC PROPERTIES, INC.,
	 	 	an Arizona corporation, its Managing Member
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 






[Signatures Continue]




7









 








LENDER




ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership




	 	 	 	 	 	 	 
	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kathy Millhouse
	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Kathy Millhouse	 	 
	 

	 	Title:
	 	Senior Vice President	 	 







8









 









EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village

	 	200 Bicentennial Circle
	 	$	44,800,000	 
	 

	 	Sacramento, CA 95826	 	 	 	 
	Aspen Court

	 	2305 Ashcroft
	 	$	5,700,000	 
	 

	 	Arlington, TX 76006	 	 	 	 
	Braesridge

	 	11100 Braesridge
	 	$	14,650,00	 
	 

	 	Houston, TX 77071	 	 	 	 
	Crown Pointe

	 	3788 NE 4th Street
	 	$	11,900,000	 
	 

	 	Renton, WA 98056	 	 	 	 
	Derby Park

	 	606 W. Safari Parkway
	 	$	15,900,000	 
	 

	 	Grand Prairie, TX 75050	 	 	 	 
	Hilltop

	 	500 Monroe Avenue NE
	 	$	11,000,000	 
	 

	 	Renton, WA 98056	 	 	 	 
	Riverwood

	 	1045 Holcomb Bridge Road
	 	$	16,750,000	 
	 

	 	Roswell, GA 30076	 	 	 	 
	The Summit

	 	1057 Americana Lane
	 	$	12,250,000	 
	 

	 	Mesquite, TX 75150	 	 	 	 
	Summit Ridge

	 	1604 Ridge Haven Drive
	 	$	11,000,000	 
	 

	 	Arlington, TX 76011	 	 	 	 
	Village at Cliffdale

	 	567 Cutchen Lane
	 	$	16,500,000	 
	 

	 	Fayetteville, NC 28314	 	 	 	 
	Beaumont

	 	8504 82nd Street, S.W.
	 	$	15,200,000	 
	 

	 	Lakewood, WA 98498	 	 	 	 
	Chelsea Park

	 	11000 Crescent Moon
	 	$	7,700,000	 
	 

	 	Houston, TX 77064	 	 	 	 
	Country Club Place

	 	1111 Golfview
	 	$	7,000,000	 
	 

	 	Richmond, TX 77469	 	 	 	 
	Dunwoody Pointe

	 	7901 Roswell Road
	 	$	14,100,000	 
	 

	 	Atlanta, GA 30350	 	 	 	 
	Stonegate

	 	825 S. Alma School Road
	 	$	7,400,000	 
	 

	 	Mesa, AZ 85210	 	 	 	 
	Trinity Park

	 	5301 Creek Ridge Lane
	 	$	22,540,000	 
	 

	 	Raleigh, NC 27607	 	 	 	 







A-1









 








THIRD AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS THIRD AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as
of the 21st day of March, 2002 by (i) (a) UNITED DOMINION REALTY TRUST, INC., a Virginia
corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) HERITAGE – ASPEN COURT L.P., an Arizona limited partnership (“Aspen”),
(d) SOUTH WEST PROPERTIES, L.P., a Delaware limited partnership (“South West”), (e) AAC/FSC
CROWN POINTE INVESTORS, LLC, a Washington limited liability company (“Crown Pointe”), (f)
HERITAGE – GENTRY PLACE L.P., an Arizona limited partnership (“Gentry Derby”), (g) AAC/FSC
HILLTOP INVESTORS, LLC, a Washington limited liability company (“Hilltop”), (h) UNITED
DOMINION REALTY, L.P., a Virginia limited partnership (“UDR”), (i) HERITAGE – SMITH SUMMIT
L.P., an Arizona limited partnership (“Smith Summit”), (j) UDR SUMMIT RIDGE, L.P., a
Delaware limited partnership (“Summit Ridge”), (k) UDRT OF NORTH CAROLINA, L.L.C., a North
Carolina limited liability company (“UDRT-NC”) (individually and collectively, Aspen, South
West, Crown Pointe, Gentry Place, Hilltop, UDR, Smith Summit, Summit Ridge and UDRT-NC, “First
Additional Borrower”), (l) UDR BEAUMONT, LLC, a Virginia limited liability company
(“Beaumont”), (m) HERITAGE – CHELSEA PARK L.P., an Arizona limited partnership
(“Chelsea”), (n) HERITAGE – COUNTRY CLUB PLACE L.P., an Arizona limited partnership
(“Country Club”), (o) CONTEMPO HEIGHTS L.L.C., an Arizona limited liability company
(“Contempo Stonegate”), (individually and collectively, Beaumont, Chelsea, Country Club and
Contempo Stonegate, “Second Additional Borrower”), (p) HERITAGE – ARBOR TERRACE I, L.L.C.,
an Arizona limited liability company (“Arbor I”), (q) HERITAGE – ARBOR TERRACE II, L.L.C.,
an Arizona limited liability company (“Arbor II”), (r) AAC FUNDING PARTNERSHIP II, a
Delaware general partnership (“AAC”), and (s) JAMESTOWN OF ST. MATTHEWS LIMITED
PARTNERSHIP, an Ohio limited partnership (“Jamestown of St. Matthews”) (individually and
collectively, Arbor I, Arbor II, AAC, and Jamestown of St. Matthews, “Third Additional
Borrower”) (individually and collectively, Original Borrower, First Additional Borrower,
Second Additional Borrower and Third Additional Borrower, “Borrower”) and (ii) ARCS
COMMERCIAL MORTGAGE CO., L.P., a California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(the “Master Agreement”) Original Borrower and Lender agreed to the terms and conditions
under which Lender would establish a credit facility in the original amount of $300,000,000 and
make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, each First Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Original Borrower and First Additional Borrower added nine (9)



 









 







Mortgaged Properties commonly known as Aspen Court owned by Aspen, Braesridge owned by South West,
Crown Pointe owned by Crown Pointe, Derby Park owned by Gentry Derby, Hilltop owned by Hilltop,
Riverwood owned by UDR, The Summit owned by Smith Summit, Summit Ridge owned by Summit Ridge, and
Village at Cliffdale owned by UDRT-NC, to the Collateral Pool.



     D. Pursuant to the certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, each Second Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Original Borrower, First Additional Borrower and Second Additional Borrower added
six (6) Mortgaged Properties commonly known as Beaumont owned by Beaumont, Chelsea Park owned by
Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe owned by UDRT, Stonegate owned
by Contempo Stonegate, and Trinity Park owned by UDRT-NC, to the Collateral Pool.



     F. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     G. The parties are executing this Amendment to the Master Agreement to (i) reflect the
addition of fourteen (14) Mortgaged Properties commonly known American Heritage owned by AAC, Arbor
Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by AAC, Foothills
owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews, Jamestown of Toledo
owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons owned by AAC,
Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and Tualatin
Heights owned by UDR, to the Collateral Pool and (ii) reflect changes to the notice provision as
set forth below.



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 1. Addition of Mortgaged Property. The Mortgaged Properties commonly known as
Arbor Terrace I, Arbor Terrace II, American Heritage, Brandywine, Foothills, Jamestown of St.
Matthews, Jamestown of Toledo, Kings Gate, Lakewood, Lancaster Commons, Lancaster Lakes, Nemoke,
Sugar Mill Creek, Tualatin Heights are hereby added to the Collateral Pool under the Master
Agreement.



     Section 2. Arbor Terrace. Section 7.03(f) is hereby amended by adding the following
new language to the end thereof:



2









 







“; notwithstanding the foregoing, neither of the Mortgaged Properties commonly known
as Arbor Terrace I and Arbor Terrace II located in Port Orchard, Washington, shall
be released from the Collateral Pool unless both Arbor Terrace I and Arbor Terrace
II are released from the Collateral Pool simultaneously.”



     Section 3. Exhibit A. Exhibit A to the Master Agreement is hereby deleted and
replaced with the Exhibit A attached to this Amendment.



     Section 4. Lender Notices. Section 23.08 is hereby amended by deleting the notice
provision for the Lender and replacing it with the following:



     As to the Lender:


ARCS Commercial Mortgage Co., L.P.

26901 Agoura Road, #200

Calabasas Hills, California 91301

Attn: Timothy L. White

Telecopy No.: (818) 880-3333




     with a copy to:


ARCS Commercial Mortgage

26901 Agoura Road, #200

Calabasas Hills, California 91301

Attn: Loan Administration Dept.




     Section 5. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 6. Full Force and Effect. Except as expressly modified by this Amendment, all
terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 7. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 8. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




3









 








     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year
first above written.



BORROWER




	 	 	 	 	 	 	 	 	 
	UNITED DOMINION REALTY TRUST, INC., a Virginia corporation
	 
	 	 	 	 	 	 	 	 
	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 
	Name:	 	Ella S. Neyland
	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 
	WOODLAKE VILLAGE, L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P., a Virginia limited partnership,
	 	 	its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Virginia
	 	 	 	 	corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	HERITAGE — ASPEN COURT L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,
	 	 	an Arizona corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer






[Signatures Continue]





4









 





SOUTH WEST PROPERTIES, L.P.,

a Delaware limited partnership




	 	 	 	 	 	 	 	 	 	 	 
	By:	 	UDR HOLDINGS, LLC, a Virginia limited liability	 	 
	 	 	company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






AAC/FSC CROWN POINTE INVESTORS, LLC,

a Washington limited liability company




	 	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware limited	 	 
	 	 	liability company, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	 	 	a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Ella S. Neyland	 	 
	 	 	 	 	 	 	Title: Executive Vice President and Treasurer	 	 






HERITAGE – GENTRY PLACE L.P.,

an Arizona limited partnership




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




5









 








AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company




	 	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware

limited liability company, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia

limited partnership, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	  
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






UNITED DOMINION REALTY, L.P.,

a Virginia limited partnership, Sole Member




	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






HERITAGE – SMITH SUMMIT L.P.,

an Arizona limited partnership




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




6









 








UDR SUMMIT RIDGE, L.P.,

a Delaware limited partnership




	 	 	 	 	 	 	 
	By:	 	SOUTH WEST REIT HOLDING, INC.

a Texas corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






UDRT OF NORTH CAROLINA, L.L.C.,

a North Carolina limited liability company




	 	 	 	 	 	 	 	 	 
	By:	 	UDR OF NC, Limited Partnership,

a North Carolina limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR OF NORTH CAROLINA, INC.,

a North Carolina corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






UDR BEAUMONT, LLC,

a Virginia limited liability company




	 	 	 	 	 	 	 	 	 
	By:	 	HERITAGE COMMUNITIES L.P.,

a Delaware limited partnership, its Manager	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR INVESTMENTS CORPORATION,

a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




7









 








HERITAGE – CHELSEA PARK L.P.,

an Arizona limited partnership




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






HERITAGE – COUNTRY CLUB PLACE L.P.,

an Arizona limited partnership




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






CONTEMPO HEIGHTS L.L.C.,

an Arizona limited liability company




	 	 	 	 	 	 	 
	By:	 	ASC PROPERTIES, INC.,

an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




8









 








HERITAGE – ARBOR TERRACE I, L.L.C.,

an Arizona limited liability company




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






HERITAGE – ARBOR TERRACE II, L.L.C.,

an Arizona limited liability company




	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,

an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






AAC FUNDING PARTNERSHIP II,

a Delaware general partnership




	 	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P.,

a Virginia limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




9









 








JAMESTOWN OF ST. MATTHEWS LIMITED PARTNERSHIP,

an Ohio limited partnership




	 	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P.,

a Virginia limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,

a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
	 	 
	 

	 	 	 	 	 	 	 	 
	 	 	 	 	Name: Ella S. Neyland

Title: Executive Vice President and Treasurer	 	 






[Signatures Continue]




10









 








LENDER




ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership




	 	 	 	 	 	 	 
	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Timothy L. White
	 	 
	 

	 	 	 	 	 	 
	 	 	Name: Timothy L. White

Title: Chief Operating Officer	 	 







11









 








EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village

	 	200 Bicentennial Circle

Sacramento, CA 95826
	 	$	44,800,000	 
	Aspen Court

	 	2305 Ashcroft

Arlington, TX 76006
	 	$	5,700,000	 
	Braesridge

	 	11100 Braesridge

Houston, TX 77071
	 	$	14,650,00	 
	Crown Pointe

	 	3788 NE 4th Street

Renton, WA 98056
	 	$	11,900,000	 
	Derby Park

	 	606 W. Safari Parkway 

Grand Prairie, TX 75050
	 	$	15,900,000	 
	Hilltop

	 	500 Monroe Avenue NE

Renton, WA 98056
	 	$	11,000,000	 
	Riverwood

	 	1045 Holcomb Bridge Road

Roswell, GA 30076
	 	$	16,750,000	 
	The Summit

	 	1057 Americana Lane

Mesquite, TX 75150
	 	$	12,250,000	 
	Summit Ridge

	 	1604 Ridge Haven Drive

Arlington, TX 76011
	 	$	11,000,000	 
	Village at Cliffdale

	 	567 Cutchen Lane

Fayetteville, NC 28314
	 	$	16,500,000	 
	Beaumont

	 	8504 82nd Street, S.W.

Lakewood, WA 98498
	 	$	15,200,000	 
	Chelsea Park

	 	11000 Crescent Moon

Houston, TX 77064
	 	$	7,700,000	 
	Country Club Place

	 	1111 Golfview

Richmond, TX 77469
	 	$	7,000,000	 
	Dunwoody Pointe

	 	7901 Roswell Road

Atlanta, GA 30350
	 	$	14,100,000	 
	Stonegate

	 	825 S. Alma School Road

Mesa, AZ 85210
	 	$	7,400,000	 
	Trinity Park

	 	5301 Creek Ridge Lane

Raleigh, NC 27607
	 	$	22,540,000	 
	Arbor Terrace I

	 	1800 Sidney Avenue

Port Orchard, WA 98366
	 	$	7,913,043	 
	Arbor Terrace II

	 	1790 Sidney Avenue

Port Orchard, WA 98366
	 	$	6,086,957	 
	American Heritage

	 	3325 Watkins Lake Road

Waterford, MI 48328
	 	$	5,200,000	 






A-1 









 






	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Brandywine Creek

	 	3075 Endenhall Way

East Lansing MI 48823
	 	$	20,200,000	 
	Foothills Tennis Village

	 	5 Marcia Way

Roseville, CA 95747
	 	$	22,600,000	 
	Jamestown of St. Matthews

	 	900 Milford Lane 

St. Matthews, KY 40207
	 	$	17,100,000	 
	Jamestown of Toledo

	 	3215 Milstead Drive

Toledo, OH 43606
	 	$	7,300,000	 
	Kings Gate

	 	44090 Kings Gate Drive

Sterling Heights, MI 48314
	 	$	6,600,000	 
	Lakewood

	 	5735 Ridgeway Drive

Haslett, MI 48840
	 	$	5,900,000	 
	Lancaster Commons

	 	2489 Coral Avenue NE

Salem, OR 97305
	 	$	11,300,000	 
	Lancaster Lakes

	 	5147 Lancaster Hill Drive

Clarkston, MI 48346
	 	$	18,500,000	 
	Nemoke Trail

	 	1765 Nemoke Trail

Haslett, MI 48840
	 	$	19,000,000	 
	Sugar Mill Creek

	 	8500 Belcher Road

Pinellas Park, FL 33781
	 	$	10,600,000	 
	Tualatin Heights

	 	9301 SW Sagert Road

Tualatin, OR 97062
	 	$	14,575,000	 







A-2 









 








FOURTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS FOURTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made
as of the 14th day of May, 2002 by (i) (a) UNITED DOMINION REALTY TRUST, INC., a Virginia
corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) HERITAGE – ASPEN COURT L.P., an Arizona limited partnership (“Aspen”),
(d) SOUTH WEST PROPERTIES, L.P., a Delaware limited partnership (“South West”), (e) AAC/FSC
CROWN POINTE INVESTORS, LLC, a Washington limited liability company (“Crown Pointe”), (f)
HERITAGE – GENTRY PLACE L.P., an Arizona limited partnership (“Gentry Derby”), (g) AAC/FSC
HILLTOP INVESTORS, LLC, a Washington limited liability company (“Hilltop”), (h) UNITED
DOMINION REALTY, L.P., a Virginia limited partnership (“UDR”), (i) HERITAGE – SMITH SUMMIT
L.P., an Arizona limited partnership (“Smith Summit”), (j) UDR SUMMIT RIDGE, L.P., a
Delaware limited partnership (“Summit Ridge”), (k) UDRT OF NORTH CAROLINA, L.L.C., a North
Carolina limited liability company (“UDRT-NC”) (individually and collectively, Aspen, South
West, Crown Pointe, Gentry Place, Hilltop, UDR, Smith Summit, Summit Ridge and UDRT-NC, “First
Additional Borrower”), (l) UDR BEAUMONT, LLC, a Virginia limited liability company
(“Beaumont”), (m) HERITAGE – CHELSEA PARK L.P., an Arizona limited partnership
(“Chelsea”), (n) HERITAGE – COUNTRY CLUB PLACE L.P., an Arizona limited partnership
(“Country Club”), (o) CONTEMPO HEIGHTS L.L.C., an Arizona limited liability company
(“Contempo Stonegate”), (individually and collectively, Beaumont, Chelsea, Country Club and
Contempo Stonegate, “Second Additional Borrower”), (p) HERITAGE – ARBOR TERRACE I, L.L.C.,
an Arizona limited liability company (“Arbor I”), (q) HERITAGE – ARBOR TERRACE II, L.L.C.,
an Arizona limited liability company (“Arbor II”), (r) AAC FUNDING PARTNERSHIP II, a
Delaware general partnership (“AAC”), and (s) JAMESTOWN OF ST. MATTHEWS LIMITED
PARTNERSHIP, an Ohio limited partnership (“Jamestown of St. Matthews”) (individually and
collectively, Arbor I, Arbor II, AAC, and Jamestown of St. Matthews, “Third Additional
Borrower”) (individually and collectively, Original Borrower, First Additional Borrower,
Second Additional Borrower and Third Additional Borrower, “Borrower”) and (ii) ARCS
COMMERCIAL MORTGAGE CO., L.P., a California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(the “Master Agreement”) Original Borrower and Lender agreed to the terms and conditions
under which Lender would establish a credit facility in the original amount of $300,000,000 and
make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, each First Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Original Borrower and First Additional Borrower added nine (9)



 









 







Mortgaged Properties commonly known as Aspen Court owned by Aspen, Braesridge owned by South West,
Crown Pointe owned by Crown Pointe, Derby Park owned by Gentry Derby, Hilltop owned by Hilltop,
Riverwood owned by UDR, The Summit owned by Smith Summit, Summit Ridge owned by Summit Ridge, and
Village at Cliffdale owned by UDRT-NC, to the Collateral Pool.



     D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, each Second Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Original Borrower, First Additional Borrower and Second Additional Borrower added
six (6) Mortgaged Properties commonly known as Beaumont owned by Beaumont, Chelsea Park owned by
Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe owned by UDRT, Stonegate owned
by Contempo Stonegate, and Trinity Park owned by UDRT-NC, to the Collateral Pool.



     F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21,
2002, each Third Additional Borrower joined into the Master Agreement as if each were an Original
Borrower.



     G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of
March 21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage
owned by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine
owned by AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



     H. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     I. The parties are executing this Amendment to the Master Agreement to reflect a conversion of
a portion of the Revolving Facility to the Base Facility Commitment.



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 1. Conversion. The Revolving Facility shall be reduced by, and the Base
Facility Commitment shall be increased by, $150,000,000, and the definitions of “Revolving







2









 




Facility Commitment” and “Base Facility Commitment” are hereby replaced in their entirety by
the following new definitions:





     “Base Facility Commitment” means $150,000,000, plus such amount as the Borrower
may elect to add to the Base Facility Commitment in accordance with Articles III or VIII.




     “Revolving Facility Commitment” means an aggregate amount of $134,513,000,
evidenced by the Revolving Facility Note in the form attached hereto as Exhibit I,
plus such amount as the Borrower may elect to add to the Revolving Facility Commitment in
accordance with Article VIII, and less such amount as the Borrower may elect to convert from
the Revolving Facility Commitment to the Base Facility Commitment in accordance with Article
III and less such amount by which the Borrower may elect to reduce the Revolving Facility
Commitment in accordance with Article IX.



     Section 2. Notes. In connection with the conversion, Borrower has executed and
delivered that certain Base Facility Note in the amount of $100,000,000, that certain Base Facility
Note in the amount of $50,000,000, and that certain Amended and Restated Multifamily Revolving
Facility Note in the amount of $134,513,000, each dated as of even date herewith.



     Section 3. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 4. Full Force and Effect. Except as expressly modified by this Amendment, all
terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 5. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 6. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.


[Signatures follow on next page]




3









 








     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year
first above written.



BORROWER




UNITED DOMINION REALTY TRUST, INC., a Virginia corporation




	 	 	 	 	 	 	 	 	 
	By:	 	/s/ Ella S. Neyland	 	 
	 	 	 	 	 
	Name:	 	Ella S. Neyland	 	 
	Title:	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P., a Virginia limited partnership,
	 	 	its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Virginia	 	 
	 	 	 	 	corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland
 

	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	HERITAGE — ASPEN COURT L.P.,	 	 
	an Arizona limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland	 	 
	 	 	Title:	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




4









 








	 	 	 	 	 	 	 	 	 	 	 
	SOUTH WEST PROPERTIES, L.P.,	 	 
	a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	UDR HOLDINGS, LLC, a Virginia limited liability	 	 
	 	 	company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia
	 	 	 	 	limited partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland
 

	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	AAC/FSC CROWN POINTE INVESTORS, LLC,	 	 
	a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware limited
	 	 	liability company, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia
	 	 	 	 	limited partnership, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland
 

	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	HERITAGE — GENTRY PLACE L.P.,	 	 
	an Arizona limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer





[Signatures Continue]




5









 








	 	 	 	 	 	 	 	 	 	 	 
	AAC/FSC HILLTOP INVESTORS, LLC,	 	 
	a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	AAC/FSC SEATTLE PROPERTIES, LLC, a Delaware
	 	 	limited liability company, its Managing Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Virginia	 	 
	 	 	 	 	limited partnership, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	UNITED DOMINION REALTY, L.P.,	 	 
	a Virginia limited partnership, Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	a Virginia corporation, General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland	 	 
	 	 	Title:	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	HERITAGE — SMITH SUMMIT L.P.,	 	 
	an Arizona limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland	 	 
	 	 	Title:	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




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	UDR SUMMIT RIDGE, L.P.,
	a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	SOUTH WEST REIT HOLDING, INC.
	 	 	a Texas corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland	 	 
	 	 	Title:	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	UDRT OF NORTH CAROLINA, L.L.C.,
	a North Carolina limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	UDR OF NC, Limited Partnership,
	 	 	a North Carolina limited partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR OF NORTH CAROLINA, INC.,	 	 
	 	 	 	 	a North Carolina corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 	 	 
	UDR BEAUMONT, LLC,
	a Virginia limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE COMMUNITIES L.P.,
	 	 	a Delaware limited partnership, its Manager
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR INVESTMENTS CORPORATION,	 	 
	 	 	 	 	a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




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	HERITAGE — CHELSEA PARK L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	HERITAGE — COUNTRY CLUB PLACE L.P.,
	an Arizona limited partnership
	 
	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 
	 
	 	 	 	 	 	 
	CONTEMPO HEIGHTS L.L.C.,
	an Arizona limited liability company
	 
	 	 	 	 	 	 
	By:	 	ASC PROPERTIES, INC.,	 	 
	 	 	an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	Title:
	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




8









 








	 	 	 	 	 	 	 	 	 
	HERITAGE — ARBOR TERRACE I, L.L.C.,
	an Arizona limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 
	HERITAGE — ARBOR TERRACE II, L.L.C.,
	an Arizona limited liability company
	 
	 	 	 	 	 	 	 	 
	By:	 	HERITAGE SGP CORPORATION,	 	 
	 	 	an Arizona corporation, its Managing Member	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Ella S. Neyland
	 	 	 	 	 	 	 
	 	 	Name:	 	Ella S. Neyland
	 	 	Title:	 	Executive Vice President and Treasurer
	 
	 	 	 	 	 	 	 	 
	AAC FUNDING PARTNERSHIP II,
	a Delaware general partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P.,	 	 
	 	 	a Virginia limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Ella S. Neyland	 	 
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Ella S. Neyland	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




9









 








	 	 	 	 	 	 	 	 	 
	JAMESTOWN OF ST. MATTHEWS LIMITED PARTNERSHIP,
	an Ohio limited partnership
	 
	 	 	 	 	 	 	 	 
	By:	 	UNITED DOMINION REALTY, L.P.,	 	 
	 	 	a Virginia limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Ella S. Neyland
 

Ella S. Neyland
	 	 
	 

	 	 	 	Title:
	 	Executive Vice President and Treasurer	 	 





[Signatures Continue]




10









 








LENDER




ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership


	 	 	 	 	 	 	 
	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Shelly Eisenberg
 

Shelly Eisenberg
	 	 
	 

	 	Title:
	 	Vice President	 	 






11









 






FIFTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT



THIS FIFTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as of
the 8th day of October, 2004 by and among (i) (a) UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
(“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability
company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited partnership
(“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership (“UDR
NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership (“AAC”), (h)
HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage Communities”), and (i)
UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR Texas”) (individually and
collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities and
UDR Texas, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited
partnership (“Lender”).




RECITALS



A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001, (as
amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed to
the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14, 2002,
Heritage — Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage -
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
- Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of January
14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned by
Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage -
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage — Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo Heights L.L.C.,
an Arizona limited liability company (“Contempo Heights”) joined into the Master Agreement
as if each were an Original Borrower.




 









 







E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21, 2002,
Heritage — Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage — Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of March
21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage owned
by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by
AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews LP,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of May
14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased by,
$150,000,000.00.



I. All of the Lender’s right, title and interest in the Master Agreement and the Loan Documents
executed in connection with the Master Agreement or the transactions contemplated by the Master
Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



J. The parties are executing this Amendment to the Master Agreement to reflect (i) the succession
by merger of (a) Heritage Communities to the rights and obligations under the Master Agreement of
Arbor I, Arbor II, Aspen, Gentry Place, Smith Summit, Chelsea Park, Country Club and Beaumont and
(b) UDR Texas to the rights and obligations of South West, Summit Ridge and Contempo Heights under
the Master Agreement and (ii) the addition of the Mortgaged Properties commonly known as (a)
Alexander Court, owned by UDR, and (b) Meadows at Kildaire, owned by UDR NC, to the Collateral
Pool, (iii) the release of the Mortgaged Properties known as (a) American Heritage, owned by AAC,
(b) Jamestown of St. Matthews, owned by Jamestown of St. Matthews LP, (c) Kings Gate, owned by AAC,
and (d) Lakewood, owned by AAC, from the Collateral Pool, and (iv) the release of Jamestown of St.
Matthews LP from each of the Loan Documents as a Borrower.



NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable





2









 




consideration, the receipt and sufficiency of which is hereby acknowledged, hereby agree as
follows:




     Section 1. Release of Mortgaged Properties and Jamestown of St. Matthews LP.
American Heritage, Jamestown of St. Matthews, Kings Gate, and Lakewood are hereby released from the
Collateral Pool under the Master Agreement. Jamestown of St. Matthews LP is hereby released from
each of the Loan Documents as a Borrower.



     Section 2. Addition of Mortgaged Properties, Heritage Community and UDR Texas.
Alexander Court and Meadows at Kildaire are hereby added to the Collateral Pool as additional
Mortgaged Properties under the Master Agreement. Both Heritage Communities and UDR Texas hereby
join the Master Agreement as a Borrower.



     Section 3. Exhibit A. Exhibit A to the Master Agreement is hereby deleted in
its entirety and replaced with Exhibit A to this Amendment.



     Section 4. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 5. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 6. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 7. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




3









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




BORROWER




UNITED DOMINION REALTY TRUST, INC., a Maryland corporation




	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






WOODLAKE VILLAGE, L.P., a California limited partnership





	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership,
its General Partner






	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






AAC/FSC CROWN POINTE INVESTORS, LLC,

a Washington limited liability company





	By:	 	AAC SEATTLE I, INC., a Delaware corporation,
its Administrative Member





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






[Signatures Continue]




4









 








AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company





	By:	 	AAC SEATTLE I, INC., a Delaware
corporation, its Administrative Member





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






UNITED DOMINION REALTY, L.P.,

a Delaware limited partnership





	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






UDR OF NC, LIMITED PARTNERSHIP,

a North Carolina limited partnership





	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited
liability company, its General Partner






	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware
limited partnership, its Sole Member






	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






[Signatures Continue]




5









 







AAC FUNDING PARTNERSHIP II,

a Delaware general partnership





	By:	 	AAC FUNDING II, INC.,
a Delaware corporation, its Managing Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 





HERITAGE COMMUNITIES L.P.,

a Delaware limited partnership





	By:	 	ASR OF DELAWARE LLC,

a Delaware limited liability company,

its General Partner






	 	 	 	By: ASR INVESTMENTS CORPORATION,
a Maryland corporation, its Sole Member





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 





UDR TEXAS PROPERTIES, L.P.,
a Delaware limited partnership





	By:	 	UDR WESTERN RESIDENTIAL, INC.,
a Virginia corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






[Signatures Continue]




6









 








ACKNOWLEDGED



JAMESTOWN OF ST. MATTHEWS LIMITED PARTNERSHIP,

an Ohio limited partnership





	By:	 	UNITED DOMINION REALTY, L.P.,
a Delaware limited partnership, its General Partner






	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 
	 

	 	Name:
	 	Rodney A. Neuheardt	 	 
	 

	 	Title:
	 	Senior Vice President—Finance & Treasurer	 	 






[Signatures Continue]




7









 








LENDER




ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership





	 	 	By: ACMC Realty, Inc., a California Corporation, its General Partner





	 	 	 	 	 	 	 
	By:

	 	 	 	/s/ Larry R. Sneathern	 	 
	 

	 	 	 	Larry R. Sneathern	 	 
	 

	 	 	 	Senior Vice President	 	 






8









 






EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village

	 	200 Bicentennial Circle

Sacramento, CA 95826
	 	$	44,800,000	 
	 
	 	 	 	 	 	 
	Aspen Court

	 	2305 Ashcroft

Arlington, TX 76006
	 	$	5,700,000	 
	 
	 	 	 	 	 	 
	Braesridge

	 	11100 Braesridge

Houston, TX 77071
	 	$	14,650,00	 
	 
	 	 	 	 	 	 
	Crown Pointe

	 	3788 NE 4th Street

Renton, WA 98056
	 	$	11,900,000	 
	 
	 	 	 	 	 	 
	Derby Park

	 	606 W. Safari Parkway

Grand Prairie, TX 75050
	 	$	15,900,000	 
	 
	 	 	 	 	 	 
	Hilltop

	 	500 Monroe Avenue NE

Renton, WA 98056
	 	$	11,000,000	 
	 
	 	 	 	 	 	 
	Riverwood

	 	1045 Holcomb Bridge Road

Roswell, GA 30076
	 	$	16,750,000	 
	 
	 	 	 	 	 	 
	The Summit

	 	1057 Americana Lane

Mesquite, TX 75150
	 	$	12,250,000	 
	 
	 	 	 	 	 	 
	Summit Ridge

	 	1604 Ridge Haven Drive

Arlington, TX 76011
	 	$	11,000,000	 
	 
	 	 	 	 	 	 
	Village at Cliffdale

	 	567 Cutchen Lane

Fayetteville, NC 28314
	 	$	16,500,000	 
	 
	 	 	 	 	 	 
	Beaumont

	 	8504 82nd Street, S.W.

Lakewood, WA 98498
	 	$	15,200,000	 
	 
	 	 	 	 	 	 
	Chelsea Park

	 	11000 Crescent Moon

Houston, TX 77064
	 	$	7,700,000	 
	 
	 	 	 	 	 	 
	Country Club Place

	 	1111 Golfview

Richmond, TX 77469
	 	$	7,000,000	 
	 
	 	 	 	 	 	 
	Dunwoody Pointe

	 	7901 Roswell Road

Atlanta, GA 30350
	 	$	14,100,000	 
	 
	 	 	 	 	 	 
	Stonegate

	 	825 S. Alma School Road

Mesa, AZ 85210
	 	$	7,400,000	 
	 
	 	 	 	 	 	 
	Trinity Park

	 	5301 Creek Ridge Lane

Raleigh, NC 27607
	 	$	22,540,000	 
	 
	 	 	 	 	 	 
	Arbor Terrace I

	 	1800 Sidney Avenue

Port Orchard, WA 98366
	 	$	7,913,043	 
	 
	 	 	 	 	 	 
	Arbor Terrace II

	 	1790 Sidney Avenue

Port Orchard, WA 98366
	 	$	6,086,957	 
	 
	 	 	 	 	 	 
	Brandywine Creek

	 	3075 Endenhall Way

East Lansing MI 48823
	 	$	20,200,000	 
	 
	 	 	 	 	 	 
	Foothills Tennis Village

	 	5 Marcia Way

Roseville, CA 95747
	 	$	22,600,000	 
	 
	 	 	 	 	 	 
	Jamestown of Toledo

	 	3215 Milstead Drive

Toledo, OH 43606
	 	$	7,300,000	 
	 
	 	 	 	 	 	 
	Lancaster Commons

	 	2489 Coral Avenue NE

Salem, OR 97305
	 	$	11,300,000	 
	 
	 	 	 	 	 	 
	Lancaster Lakes

	 	5147 Lancaster Hill Drive

Clarkston, MI 48346
	 	$	18,500,000	 






A-1









 






	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Nemoke Trail

	 	1765 Nemoke Trail

Haslett, MI 48840
	 	$	19,000,000	 
	 
	 	 	 	 	 	 
	Sugar Mill Creek

	 	8500 Belcher Road

Pinellas Park, FL 33781
	 	$	10,600,000	 
	 
	 	 	 	 	 	 
	Tualatin Heights

	 	9301 SW Sagert Road

Tualatin, OR 97062
	 	$	14,575,000	 
	 
	 	 	 	 	 	 
	Alexander Court

	 	135 Reynoldsburg-New Albany Road

Reynoldsburg, OH 43068
	 	$	18,520,550	 
	 
	 	 	 	 	 	 
	Meadows at Kildaire

	 	2600 Harvest Creek Place

Apex, NC 27539
	 	$	20,109,220	 







A-2









 





SIXTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT



THIS SIXTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as of
the 1st day of December, 2004 by and among (i) (a) UNITED DOMINION REALTY TRUST, INC., a
Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
(“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability
company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited partnership
(“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership (“UDR
NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership (“AAC”), (h)
HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage Communities”), and (i)
UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR Texas”) (individually and
collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities, and
UDR Texas, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited
partnership (“Lender”).




RECITALS



A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001, (as
amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed to
the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14, 2002,
Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of January
14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned by
Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo Heights L.L.C.,
an Arizona limited liability company (“Contempo Heights”) joined into the Master Agreement
as if each were an Original Borrower.




 









 







E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21, 2002,
Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of March
21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage owned
by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by
AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews LP,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of May
14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased by,
$150,000,000.00.



I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement dated as
of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to the
rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place, Smith
Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and obligations of
South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii) the addition of
the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and (b) Meadows at
Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the Mortgaged Properties
known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews, owned by Jamestown of
St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by AAC, from the Collateral
Pool, and (iv) the release of Jamestown of St. Matthews LP from each of the Loan Documents as a
Borrower.



J. All of the Lender’s right, title and interest in the Master Agreement and the Loan Documents
executed in connection with the Master Agreement or the transactions contemplated by the Master
Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.




2









 







K. The parties are executing this Amendment to the Master Agreement to reflect the release of the
Mortgaged Properties known as Brandywine Creek, owned by AAC, and Stonegate, owned by UDR Texas,
from the Collateral Pool.



NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:




     Section 1. Release of Mortgaged Properties. Brandywine Creek and Stonegate are hereby
released from the Collateral Pool under the Master Agreement.



     Section 2. Exhibit A. Exhibit A to the Master Agreement is hereby deleted in
its entirety and replaced with Exhibit A to this Amendment.



     Section 3. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 4. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 5. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 6. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




3









 









     IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.



	 	 	 	 	 	 	 	 	 	 	 
	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	Title:	 	 Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION
REALTY, L.P., a Delaware limited partnership, its
General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Scott A. Shanaberger
 

Scott A. Shanaberger
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	 	 	Title:	 	Senior Vice President and Chief Accounting Officer	 	 





 [Signatures Continue]



4









 









	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware
corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	 	 	Title:	 	Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	 	 	Title:	 	Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited

partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited
partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a
Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:

Name:
	 	/s/ Scott A. Shanaberger
 

 Scott A. Shanaberger
	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	 Senior Vice President and 

Chief
Accounting Officer	 	 






5









 





	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, its Managing Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	 	 	Title:	 	Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	ASR INVESTMENTS CORPORATION, a Maryland corporation, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Scott A. Shanaberger
 

Scott A. Shanaberger
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President and Chief Accounting Officer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Scott A. Shanaberger	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Scott A. Shanaberger	 	 
	 	 	 	 	Title:	 	 Senior Vice President and Chief Accounting Officer	 	 






[Signatures Continue]





6









 








	 	 	 	 	 	 	 	 	 
	 	 	LENDER
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Sharlene G. Bloom	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Sharlene G. Bloom	 	 
	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President	 	 
	 	 	 	 	 	 	 






7









 









EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village
	 	200 Bicentennial Circle
	 	$44,800,000
	 
	 	Sacramento, CA  95826	 	 
	Aspen Court
	 	2305 Ashcroft
	 	$5,700,000
	 
	 	Arlington, TX  76006	 	 
	Braesridge
	 	11100 Braesridge 
	 	$14,650,00
	 
	 	Houston, TX  77071	 	 
	Crown Pointe
	 	3788 NE 4th Street
	 	$11,900,000
	 
	 	Renton, WA  98056	 	 
	Derby Park
	 	606 W. Safari Parkway
	 	$15,900,000
	 
	 	Grand Prairie, TX  75050	 	 
	Hilltop
	 	500 Monroe Avenue NE
	 	$11,000,000
	 
	 	Renton, WA  98056	 	 
	Riverwood
	 	1045 Holcomb Bridge Road
	 	$16,750,000
	 
	 	Roswell, GA  30076	 	 
	The Summit
	 	1057 Americana Lane
	 	$12,250,000
	 
	 	Mesquite, TX  75150	 	 
	Summit Ridge
	 	1604 Ridge Haven Drive
	 	$11,000,000
	 
	 	Arlington, TX  76011	 	 
	Village at Cliffdale
	 	567 Cutchen Lane
	 	$16,500,000
	 
	 	Fayetteville, NC  28314	 	 
	Beaumont
	 	8504 82nd Street, S.W.
	 	$15,200,000
	 
	 	Lakewood, WA  98498	 	 
	Chelsea Park
	 	11000 Crescent Moon
	 	$7,700,000
	 
	 	Houston, TX  77064	 	 
	Country Club Place
	 	1111 Golfview
	 	$7,000,000
	 
	 	Richmond, TX  77469	 	 
	Dunwoody Pointe
	 	7901 Roswell Road 
	 	$14,100,000
	 
	 	Atlanta, GA  30350	 	 
	Trinity Park
	 	5301 Creek Ridge Lane 
	 	$22,540,000
	 
	 	Raleigh, NC  27607	 	 
	Arbor Terrace I
	 	1800 Sidney Avenue
	 	$7,913,043
	 
	 	Port Orchard, WA  98366	 	 
	Arbor Terrace II
	 	1790 Sidney Avenue 
	 	$6,086,957
	 
	 	Port Orchard, WA  98366	 	 
	Foothills Tennis Village
	 	5 Marcia Way
	 	$22,600,000
	 
	 	Roseville, CA  95747	 	 
	Jamestown of Toledo
	 	3215 Milstead Drive
	 	$7,300,000
	 
	 	Toledo, OH  43606	 	 
	Lancaster Commons
	 	2489 Coral Avenue NE
	 	$11,300,000
	 
	 	Salem, OR  97305	 	 
	Lancaster Lakes
	 	5147 Lancaster Hill Drive
	 	$18,500,000
	 
	 	Clarkston, MI  48346	 	 
	Nemoke Trail
	 	1765 Nemoke Trail
	 	$19,000,000
	 
	 	Haslett, MI  48840	 	 
	Sugar Mill Creek
	 	8500 Belcher Road
	 	$10,600,000
	 
	 	Pinellas Park, FL  33781	 	 







A-1 









 






	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Tualatin Heights
	 	9301 SW Sagert Road
	 	$14,575,000
	 
	 	Tualatin, OR  97062	 	 
	Alexander Court
	 	135 Reynoldsburg-New Albany Road
	 	$18,520,550
	 
	 	Reynoldsburg, OH  43068	 	 
	Meadows at Kildaire
	 	2600 Harvest Creek Place	 	$20,109,220
	 
	 	Apex, NC  27539	 	 







A-2 









 





SEVENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT



THIS SEVENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as of
the 8th day of December, 2004 by and among (i) (a) UNITED DOMINION REALTY TRUST, INC., a
Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
(“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability
company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited partnership
(“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership (“UDR
NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership (“AAC”), (h)
HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage Communities”), (i) UDR
TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR Texas”), and (j) UDR of
TENNESSEE, L.P., a Virginia limited partnership (“UDR Tennessee”) (individually and
collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities, UDR
Texas and UDR Tennessee, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a
California limited partnership (“Lender”).




RECITALS



A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001, (as
amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed to
the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14, 2002,
Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of January
14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned by
Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo Heights L.L.C.,
an Arizona limited liability company (“Contempo Heights”) joined into the Master Agreement
as if each were an Original Borrower.




 









 







E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21, 2002,
Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of March
21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage owned
by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by
AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews LP,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of May
14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased by,
$150,000,000.00.



I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement dated as
of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to the
rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place, Smith
Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and obligations of
South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii) the addition of
the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and (b) Meadows at
Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the Mortgaged Properties
known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews, owned by Jamestown of
St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by AAC, from the Collateral
Pool, and (iv) the release of Jamestown of St. Matthews LP from each of the Loan Documents as a
Borrower.



J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement dated as
of December 1, 2004 to reflect the release of the Mortgaged Properties known as Brandywine Creek,
owned by AAC, and Stonegate, owned by UDR Texas, from the Collateral Pool.



K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of even date
herewith, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.




2









 







L. All of the Lender’s right, title and interest in the Master Agreement and the Loan Documents
executed in connection with the Master Agreement or the transactions contemplated by the Master
Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



M. The parties are executing this Amendment to the Master Agreement to reflect (i) the addition of
the Mortgaged Properties commonly known as Carrington Hills, owned by UDR, and Colonnade, owned by
UDR Tennessee to the Collateral Pool, and (ii) the release of the Mortgaged Properties known as
Lancaster Lakes, owned by AAC, and Nemoke Trail, owned by AAC, from the Collateral Pool, and (iii)
the modification of other terms of the Master Agreement as set forth herein.



NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:




     Section 10. Release of Mortgaged Properties. Lancaster Lakes and Nemoke Trail are
hereby released from the Collateral Pool under the Master Agreement.



     Section 11. Addition of Mortgaged Properties. Carrington Hills and Colonnade are
hereby added to the Collateral Pool as additional Mortgaged Properties under the Master Agreement.



     Section 12. Exhibit A. Exhibit A to the Master Agreement is hereby deleted in
its entirety and replaced with Exhibit A to this Amendment.



     Section 4. Definitions. The following is hereby added to Article I of the Master
Agreement immediately preceding the definition of “Multifamily Residential Property:”




     “Multifamily REIT Preferred Interest” means a preferred equity interest: (a) owned by a
member of the Consolidated Group; (b) issued by a REIT that (i) is not a Subsidiary and (ii)
owns primarily residential apartment communities; (c) having trading privileges on a
national securities exchange or that is the subject of price quotations in the
over-the-counter market (including the NASDAQ National Market) as reported by the National
Association of Securities Dealers Automated Quotation System; and (d) not subject to
restrictions (whether contractual or under Applicable Law) on sale, transfer, assignment,
hypothecation or other limitations, in each case where such restriction would exceed 90 days
from the time of purchase, that would otherwise prevent such preferred equity interests from
being freely transferable by such member of the Consolidated Group; provided, however, that
this limitation shall not apply to preferred equity interests that could be sold pursuant to
a registration or an available exemption under the Securities Act of 1933, as amended.



3









 





     Section 5. Financial Definitions. Section 15.01 of the Master Agreement IS hereby
deleted in its entirety and restated as follows:




     “Cash Equivalents” means (a) securities issued or directly and fully guaranteed
or insured by the United States of America or any agency or instrumentality thereof
(provided that the full faith and credit of the United States of America is pledged in
support thereof) having maturities of not more than twelve months from the date of
acquisition, (b) U.S. dollar denominated time deposits and certificates of deposit of (i)
any Lender, or (ii) any domestic commercial bank of recognized standing (y) having capital
and surplus in excess of $500,000,000 and (z) whose short-term commercial paper rating from
S&P is at least A-2 (and not lower than A-3) or the equivalent thereof or from Moody’s is at
least P-2 (and not lower than P-3) or the equivalent thereof (any such bank being an
“Approved Bank”), in each case with maturities of not more than 270 days from the
date of acquisition, (c) commercial paper and variable or fixed rate notes issued by any
Approved Bank (or by the parent company thereof) or any variable rate notes issued by, or
guaranteed by, any domestic corporation rated at least A-2 (and not lower than A-3) or the
equivalent thereof by S&P or at least P-2 (and not lower than P-3) or the equivalent by
Moody’s and maturing within six months of the date of acquisition, (d) repurchase agreements
entered into by a Person with a bank or trust company (including any of the Lenders) or
recognized securities dealer having capital and surplus in excess of $500,000,000 for direct
obligations issued by or fully guaranteed by the United States of America in which such
Person shall have a perfected first priority security interest (subject to no other Liens)
and having, on the date of purchase thereof, a fair market value of at least 100% of the
amount of the repurchase obligations, (e) obligations of any State of the United States or
any political subdivision thereof, the interest with respect to which is exempt from federal
income taxation under Section 103 of the Code, having a long term rating of at least AA- or
Aa-3 by S&P or Moody’s, respectively, and maturing within three years from the date of
acquisition thereof, (f) Investments in municipal auction preferred stock (i) rated A- (or
the equivalent thereof) or better by S&P or A3 (or the equivalent thereof) or better by
Moody’s and (ii) with dividends that reset at least once every 365 days and (g) Investments,
classified in accordance with GAAP as current assets, in money market investment programs
registered under the Investment Company Act of 1940, as amended, which are administered by
reputable financial institutions having capital of at least $100,000,000 and the portfolios
of which are limited to Investments of the character described in the foregoing subdivisions
(a) through (f).




     “Consolidated Adjusted EBITDA” means for any period the Consolidated Group the
sum of Consolidated EBITDA for such period minus a reserve equal to $62.50 per apartment
unit per quarter ($250 per apartment unit per year). Except as expressly provided otherwise,
the applicable period shall be for the single fiscal quarter ending as of the date of
determination.




     “Consolidated EBITDA” means for any period for the Consolidated Group, the sum
of Consolidated Net Income plus Consolidated Interest Expense plus all provisions for any
Federal, state, or other income taxes plus depreciation, amortization and other non



4









 







cash charges, in each case on a consolidated basis determined in accordance with GAAP
applied on a consistent basis, but excluding in any event gains and losses on Investments
and extraordinary gains and losses, and taxes on such excluded gains and tax deductions or
credit on account of such excluded losses. Except as expressly provided otherwise, the
applicable period shall be for the single fiscal quarter ending as of the date of
determination.




     “Consolidated Adjusted Tangible Net Worth” means at any rate:




     (i) the sum of (A) the consolidated shareholders equity of the Consolidated
Group (net of Minority Interests) plus (B) accumulated depreciation of real estate
owned to the extent reflected in the then book value of the Consolidated Assets,
minus without duplication




     (ii) the Intangible Assets of the Consolidated Group.




     “Consolidated Funded Debt” means total Debt of the Consolidated Group on a
consolidated basis determined in accordance with GAAP applied on a consistent basis.




     “Consolidated Group” means the Borrower and its consolidated Subsidiaries, as
determined in accordance with GAAP.




     “Consolidated Interest Expense” means for any period for the Consolidated
Group, all interest expense, including the amortization of debt discount and premium, the
interest component under capital leases and the implied interest component under
Securitization Transactions in each case on a consolidated basis determined in accordance
with GAAP applied on a consistent basis.




     “Consolidated Net Income” means for any period the net income of the
Consolidated Group on a consolidated basis determined in accordance with GAAP applied on a
consistent basis.




     “Consolidated Net Operating Income” means, for any period for any multifamily
asset of the Consolidated Group, an amount equal to (i) the aggregate rental and other
income from the operation of such asset during such period; minus (ii) all expenses
and other proper charges incurred in connection with the operation of such asset (including,
without limitation, real estate taxes, a 3% management fee, and bad debt expenses) during
such period; but, in any case, before payment of or provision for debt service charges for
such period, income taxes for such period, and depreciation, amortization and other non-cash
expenses for such period, all on a consolidated basis determined in accordance with GAAP on
a consistent basis. For properties held in non-wholly owned subsidiaries, Borrower’s share
of Consolidated Net Operating Income will be included.




     “Consolidated Net Operating Income from Unencumbered Pool Assets” (i) the
aggregate rental and other income from the operation of the Unencumbered Pool Assets during
such period; minus all expenses and other proper charges incurred in



5









 







connection with the operation of the Unencumbered Pool Assets (including, without
limitation, real estate taxes and bad debt expenses) during such period; but in any case,
before payment of provision for debt service charges for such period, income taxes for such
period, and depreciation, amortization and other non-cash expenses for such period, all on a
consolidated basis determined in accordance with GAAP on a consistent basis minus (ii) a
reserve equal to $62.50 per apartment unit per quarter ($250 per apartment unit per year)
for such period.




     “Consolidated Total Fixed Charges” means as of the last day of each fiscal
quarter for the Consolidated Group, the sum of (i) the cash portion of Consolidated Interest
Expense paid in the fiscal quarter ending on such day plus (ii) scheduled maturities of
Consolidated Funded Debt (excluding the amount by which a final installment exceeds the next
preceding principal installment thereon) in the fiscal quarter ending on such day plus (iii)
all cash dividends and distributions on preferred stock or other preferred beneficial
interests of members of the Consolidated Group paid in the fiscal quarter ending on such
day, all on a consolidated basis determined in accordance with GAAP on a consistent basis.




     “Consolidated Unsecured Debt” means, for the Consolidated Group on a
consolidated basis, all unsecured Consolidated Funded Debt.




     “Debt” of any Person means at any date, without duplication, (i) all
obligations of such Person for borrowed money, (ii) all obligations of such person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all obligations of such
Person to pay deferred purchase price of property or services (other than trade accounts
payable arising in the ordinary course of business), (iv) all obligations of such Person as
lessee under capital leases, (v) all obligations of such Person to purchase securities or
other property which arise out of or in connection with the sale of the same or
substantially similar securities or property, (vi) all obligations of such person to
reimburse any bank or other person in respect of amounts payable under a letter of credit or
similar instrument (being the amount available to be drawn thereunder, whether or not then
drawn), but excluding obligations in respect of letters of credit issued for the payment of
real estate taxes, special assessments on real properties and utility deposits, in an
aggregate amount not to exceed $20,000,000, (vii) all obligations of others secured by a
Lien on any asset of such Person, whether or not such obligation is assumed by such Person,
(viii) all obligations of others Guaranteed by such Person, (ix) all obligations which in
accordance with GAAP would be shown as liabilities on a balance sheet of such Person and (x)
all obligations of such person owing under any synthetic lease, tax retention operating
lease, off balance sheet loan or similar off balance sheet financing product to which such
Person is a party, where such transaction is considered borrowed money indebtedness for tax
purposes, but classified as an operating lease in accordance with GAAP. Debt of any Person
shall include Debt of any partnership or joint venture in which such Person is a general
partner or joint venturer to the extent of such Person’s pro rata portion of the ownership
of such partnership or joint venture (except if such Debt is recourse to such Person, in
which case the greater of such Person’s pro rata portion of such Debt or the amount of the
recourse portion of the Debt, shall be included as Debt of such Person).



6









 






     “Development Property” means a Real Property currently under development (or in
the pre-development phase) as a Multifamily Property.




     “Gross Asset Value” means from time to time the sum of the following amounts
(without duplication): (a) the product of (i) Consolidated Net Operating Income for the
period of two consecutive fiscal quarters most recently ended attributable to Multifamily
Properties (excluding any Properties covered by either of the immediately following clauses
(b) or (c) owned by any member of the Consolidated Group for such period minus a reserve of
$125 per apartment unit located on a Property, multiplied by (ii) 2 and divided by (iii)
8.25%; (b) the purchase price paid for any Multifamily Property acquired by any member of
the Consolidated Group during this period of four consecutive fiscal quarters most recently
ended (less any amounts paid as a purchase price adjustment, held in escrow, retained as a
contingency reserve, or other similar arrangements); (c) the current book value of any
Development Property (or Multifamily Property that was a Development Property at any time
during the period of four consecutive fiscal quarters most recently ended) owned by any
member of the Consolidated Group; (d) unrestricted cash and cash equivalents of the
Consolidated Group; (e) the value (based on the lower of cost or market price determined in
accordance with GAAP) of any raw land owned by any member of the Consolidated Group; (f) the
value (based on the lower of cost or market price determined in accordance with GAAP) of
Properties owned by any member of the Consolidated Group that are developed but that are not
Multifamily Properties; (g) the value (based on the lower of cost or market price determined
in accordance with GAAP) of (i) all promissory notes, including any secured by a Mortgage,
payable solely to any member of the Consolidated Group and the obligors of which are not
Affiliates of the Borrower (excluding any such notes where the obligor is more than 60 days
past due with respect to any payment obligation) and (ii) all marketable securities
(excluding Multifamily REIT Preferred Interests); (h) the value (based on the lower of cost
or market price determined in accordance with GAAP) of all Multifamily REIT Preferred
Interests; and (i) the Borrower’s pro rata share of the preceding items of any
Unconsolidated Affiliate of the Borrower to the extent not already included. Notwithstanding
the foregoing, the amount by which the value of the assets included under any of the
preceding clauses (d), (e), (f), (g) and (i) (excluding any promissory note secured by a
Lien on a Multifamily Property and any raw land which such Person intends to develop as a
Multifamily Property), including the Borrower’s pro rata share of any such assets included
under the preceding clause (i), would, in the aggregate, account for more than 5.0% of Gross
Asset Value shall be excluded for purposes of determining Gross Asset Value.




     “Gross Asset Value of the Unencumbered Pool” means Gross Asset Value determined
with reference only to Unencumbered Pool Assets. Notwithstanding the foregoing, the
following amounts shall be excluded from Gross Asset Value of the Unencumbered Pool: (a) the
amount by which the value of Development Properties would, in the aggregate, account for
more than 10.0% of Gross Asset Value of the Unencumbered Pool; (b) the amount by which the
value of raw land would, in the aggregate, account for more than 5.0% of Gross Asset Value
of the Unencumbered Pool; (c) the amount by which the value of Properties that are developed
but that are not



7









 







Multifamily Properties would, in the aggregate, account for more than 5.0% of Gross Asset
Value of the Unencumbered Pool; (d) the amount by which the value (based on the lower of
cost or market price determined in accordance with GAAP) of (i) promissory notes, including
any secured by a Mortgage, payable to any member of the Consolidated Group and the obligors
of which are not Affiliates of the Borrower, and (ii) all marketable securities (excluding
Multifamily REIT Preferred Interests) would, in the aggregate, account for more than 15.0%
of Gross Asset Value of the Unencumbered Pool; (e) the amount by which the value of
Unencumbered Pool Assets owned by Subsidiaries that are not Guarantors would, in the
aggregate, account for more than 10.0% of Gross Asset Value of the Unencumbered Pool; (f)
the amount by which the value of Unencumbered Pool Assets owned by Subsidiaries that are not
Wholly Owned Subsidiaries would, in the aggregate, account for more than 10.0% of Gross
Asset Value of the Unencumbered Pool; and (g) the amount by which the value (based on the
lower of cost or market price determined in accordance with GAAP) of promissory notes that
are not secured by a Mortgage would, in the aggregate, account for more than 5.0% of Gross
Asset Value of the Unencumbered Pool. In addition, Gross Asset Value of the Unencumbered
Pool shall be determined without including (or otherwise giving credit to) any Unencumbered
Pool Assets owned by a Subsidiary that is not a Guarantor if such Subsidiary is an obligor,
as of the relevant date of determination, with respect to any Debt (other than Secured Debt
that is Nonrecourse Indebtness and those items of Debt set forth in clauses (c) and (d) of
the definition of the term Debt). In addition to the foregoing limitations, the amount by
which the value of Development Properties, Properties that are developed but that are not
Multifamily Properties, raw land, promissory notes and marketable securities (including
Multifamily REIT Preferred Interests) would, in the aggregate, account for more than 25.0%
of Gross Asset Value of the Unencumbered Pool shall be excluded for purposes of determining
Gross Asset Value of the Unencumbered Pool. The aggregate Occupancy Rate of Multifamily
Properties and other Properties that are developed, but that are not Multifamily Properties
that are developed, but that are not Multifamily Properties, must exceed 85.0%. Any
Multifamily Property or other such Property otherwise includable in determination of Gross
Asset Value of the Unencumbered Pool, but for noncompliance with the Occupancy Rate
requirement in the preceding sentence, shall be considered to be a Development Property for
purposes of determining Gross Asset Value of the Unencumbered Pool (with the value of such
Multifamily Properties of other Properties be determined in a manner consistent with clause
(a) of the definition of Gross Asset Value).




     “Intangible Assets” of any Person means at any date the amount of (i) all write
ups (other than write-ups resulting from write-ups of assets of a going concern business
made within twelve months after the acquisition of such business) in the book value of any
asset owned by such Person and (ii) all unamortized debt discount and expense, unamortized
deferred charges, capitalized start up costs, goodwill, patents, licenses, trademarks, trade
names, copyrights, organization or developmental expenses, covenants not to compete and
other intangible items.




     “Investment” means, (x) with respect to any Person, any acquisition or
investment (whether or not of a controlling interest) by such Person, by means of any of the
following: (a) the purchase or other acquisition of any equity interest in another



8









 







Person, (b) a loan, advance or extension of credit to, capital contribution to,
guaranty of debt of, or purchase or other acquisition of any Debt of, another Person,
including any partnership or joint venture interest in such other Person, or (c) the
purchase or other acquisition (in one transaction or a series of transactions) of assets of
another Person that constitute the business or a division or operating unit of another
Person and (y) with respect to any Mortgaged Property or other asset, the acquisition
thereof. Any binding commitment to make an investment in any other Person, as well as any
option of another Person to require an Investment in such Person, shall constitute an
Investment. Except as expressly provided otherwise, for purposes of determining compliance
with any covenant contained in a Loan Document, the amount of any Investment shall be the
amount actually invested, without adjustment for subsequent increases or decreases in the
value of such Investment.




     “Minority Interest” means any shares of stock (or other equity interests) of
any class of a Subsidiary (other than directors’ qualifying shares as required by law) that
are not owned by the Borrower and/or one or more Wholly Owned Subsidiaries. Minority
Interests constituting preferred stock shall be valued at the voluntary or involuntary
liquidation value of such preferred stock, whichever is greater, and by valuing common stock
at the book value of the capitalized surplus applicable thereto adjusted by the foregoing
method of valuing Minority Interests in preferred stock.




     “Multifamily Property” means any Real Property on which the improvements
consist primarily of an apartment community.




     “Real Property” means any parcel of real property owned or leased (in whole or
in part) or operated by the Borrower, any Subsidiary or any Unconsolidated Affiliate of the
Borrower and which is located in a state of the United States of America or the District of
Columbia.




     “Realty” means all real property and interests therein, together with all
improvements thereon.




     “Securitization Transaction” means any financing transaction or series of
financing transactions that have been or may be entered into by a member of the Consolidated
Group pursuant to which such member of the Consolidated Group may sell, convey or otherwise
transfer to (i) a Subsidiary or affiliate (a “Securitization Subsidiary”) or (ii) any other
Person, or may grant a security interest in, any Receivables or interest therein secured by
merchandise or services financed thereby (whether such Receivables are then existing or
arising in the future) of such member of the Consolidated Group, and any assets related
thereto, including without limitation, all security interests in merchandise or services
financed thereby, the proceeds of such Receivables, and other assets which are customarily
sold or in respect of which security interests are customarily granted in connection with
securitization transactions involving such assets. (Receivables means any right of payment
from or on behalf of any obligor, whether constituting an account, chattel paper,
instrument, general intangible or otherwise, arising from the sale or financing by a member
of the Consolidated Group or merchandise or services, and



9









 







monies due thereunder, security in the merchandise and services financed thereby,
records related thereto, and the right to payment of any interest or finance charges and
other obligations with respect thereto, proceeds from claims on insurance policies related
thereto, any other proceeds related thereto, and any other related rights.)




     “Unconsolidated Affiliate” means, with respect to any Person, any other Person
in whom such Person holds an Investment, which Investment is accounted for in the financial
statements of such Person on an equity basis of accounting and whose financial results would
not be consolidated under GAAP with the financial results of such Person on the consolidated
financial statements of such Person.




     “Unencumbered Pool Asset” means any asset owned by a member of the Consolidated
Group or an Unconsolidated Affiliate of the Borrower and that satisfies all of the following
requirements: (a) such asset is either (i) a Multifamily Property, (ii) a Property that is
developed but that is not a Multifamily Property, (iii) a Development Property, (iv) raw
land, (v) promissory notes and (vi) marketable securities (including Multifamily REIT
Preferred Interests); (b) neither such asset, nor any interest of any member of the
Consolidated Group or Unconsolidated Affiliate therein, is subject to any Lien (other than
Permitted Liens of the types described in clauses (a) through (c) of the definition thereof)
or to any Negative Pledge; (c) if such asset is owned by Person other than the Borrower (i)
none of the Borrower’s direct or indirect ownership interest in such Person is subject to
any Lien (other than Permitted Liens of the types described in clauses (a) through (c) of
the definition thereof) or to any Negative Pledge; and (ii) the Borrower directly, or
indirectly through a Subsidiary, has the right to take the following actions without the
need to obtain consent of any Person: (x) sell, transfer or otherwise dispose of such asset
and (y) to create a Lien on such asset as security for Debt of the Borrower or such
Guarantor, as applicable; (d) if such asset is owned by a Subsidiary or Unconsolidated
Affiliate which is not a Guarantor (i) the Borrower directly, or indirectly through other
Subsidiaries, owns at least 66.67% of all outstanding Equity Interests of such Person; and
(ii) such Person is not an obligor with respect to any Debt (other than unsecured Debt of
the type set forth in clauses (c) and (d) of the definition of the term Debt); and (e) in
the case of a Property, such Property is free of all structural defects or major
architectural deficiencies (if developed), title defects, environmental conditions or other
adverse matters which, individually, or collectively, materially impair the value of such
Property.




     “Wholly Owned Subsidiary” means as to any person, any Subsidiary all of the
voting stock or other similar voting interest are owned directly or indirectly by such
Person. Unless otherwise provided, references to “Wholly Owned Subsidiary” shall mean Wholly
Owned Subsidiaries of the Borrower.



     Section 6. Consolidated Funded Debt Ratio. Section 15.06 of the Master Agreement is
hereby deleted in its entirety and replaced with the following:




     SECTION 15.06 Consolidated Funded Debt Ratio. As of the last day of each
fiscal quarter, based on the
preceding two (2) fiscal quarters, annualized, Consolidated Funded Debt to Gross Asset
Value shall not exceed 60%.



10









 





     Section 7. Consolidated Total Fixed Charge Coverage Ratio. Section 15.07 of the
Master Agreement is hereby deleted in its entirety and replaced with the following:




     SECTION 15.07 Consolidated Total Fixed Charge Coverage Ratio. As of the end
of each fiscal quarter, based on the preceding two (2) fiscal quarters, annualized, the
ratio of Consolidated Adjusted EBITDA to Consolidated Total Fixed Charges for the fiscal
quarter then ended shall be not less than 1.4:1.0.



     Section 8. Consolidated Unsecured Debt to Gross Asset Value of the Unencumbered Pool.
Section 15.08 of the Master Agreement is hereby deleted in its entirety and replaced with the
following:




     SECTION 15.08 Consolidated Unsecured Debt to Gross Asset Value of the Unencumbered
Pool . As of the last day of each fiscal quarter, based on the preceding two (2) fiscal
quarters, annualized, the ratio of Consolidated Unsecured Debt to Gross Asset Value of the
Unencumbered Pool Assets shall not exceed 60%.



     Section 9. Minimum Unencumbered Interest Coverage Ratio. Section 15.09 of the Master
Agreement is hereby deleted in its entirety and replaced with the following:




     SECTION 15.09 Minimum Unencumbered Interest Coverage Ratio. The ratio of (i)
Consolidated Net Operating Income attributable to Unencumbered Pool Assets and income
attributable to promissory notes and marketable securities (including Multifamily REIT
Preferred Interests) included as Unencumbered Pool Assets, in each case for the two fiscal
quarter period most recently ending (annualized) to (ii) Consolidated Interest Expense
relating to Consolidated Unsecured Debt of the Consolidate Group, including without
limitation, interest expense, if any, attributable to such promissory notes and marketable
securities (including Multifamily REIT Preferred Interest), on a consolidated basis for such
period (all of the foregoing as annualized), to be less than 1.75 to 1.0 at the end of any
fiscal quarter.



     Section 10. Capitalized Terms. All capitalized terms used in this Amendment which
are not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 11. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 12. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 13. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




11









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




	 	 	 	 	 	 	 	 	 	 	 
	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




12









 









	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:

Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	Senior Vice President - Finance & Treasurer	 	 






[Signatures Continue]




13









 









	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, its Managing Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	 Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	 ASR INVESTMENTS CORPORATION, a Maryland corporation, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	 /s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	 Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	 Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




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	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer






[Signatures Continue]




15









 








	 	 	 	 	 	 	 	 	 
	 	 	LENDER
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Sharlene G. Bloom
	 	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Sharlene G. Bloom
	 	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Vice President
	 	 	 	 	 	 	 





16









 









EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village
	 	200 Bicentennial Circle
	 	$44,800,000
	 
	 	Sacramento, CA  95826	 	 
	Aspen Court
	 	2305 Ashcroft
	 	$5,700,000
	 
	 	Arlington, TX  76006	 	 
	Braesridge
	 	11100 Braesridge 
	 	$14,650,00
	 
	 	Houston, TX  77071	 	 
	Crown Pointe
	 	3788 NE 4th Street
	 	$11,900,000
	 
	 	Renton, WA  98056	 	 
	Derby Park
	 	606 W. Safari Parkway
	 	$15,900,000
	 
	 	Grand Prairie, TX  75050	 	 
	Hilltop
	 	500 Monroe Avenue NE
	 	$11,000,000
	 
	 	Renton, WA  98056	 	 
	Riverwood
	 	1045 Holcomb Bridge Road
	 	$16,750,000
	 
	 	Roswell, GA  30076	 	 
	The Summit
	 	1057 Americana Lane
	 	$12,250,000
	 
	 	Mesquite, TX  75150	 	 
	Summit Ridge
	 	1604 Ridge Haven Drive
	 	$11,000,000
	 
	 	Arlington, TX  76011	 	 
	Village at Cliffdale
	 	567 Cutchen Lane
	 	$16,500,000
	 
	 	Fayetteville, NC  28314	 	 
	Beaumont
	 	8504 82nd Street, S.W.
	 	$15,200,000
	 
	 	Lakewood, WA  98498	 	 
	Chelsea Park
	 	11000 Crescent Moon
	 	$7,700,000
	 
	 	Houston, TX  77064	 	 
	Country Club Place
	 	1111 Golfview
	 	$7,000,000
	 
	 	Richmond, TX  77469	 	 
	Dunwoody Pointe
	 	7901 Roswell Road 
	 	$14,100,000
	 
	 	Atlanta, GA  30350	 	 
	Trinity Park
	 	5301 Creek Ridge Lane 
	 	$22,540,000
	 
	 	Raleigh, NC  27607	 	 
	Arbor Terrace I
	 	1800 Sidney Avenue
	 	$7,913,043
	 
	 	Port Orchard, WA  98366	 	 
	Arbor Terrace II
	 	1790 Sidney Avenue 
	 	$6,086,957
	 
	 	Port Orchard, WA  98366	 	 
	Foothills Tennis Village
	 	5 Marcia Way
	 	$22,600,000
	 
	 	Roseville, CA  95747	 	 
	Jamestown of Toledo
	 	3215 Milstead Drive
	 	$7,300,000
	 
	 	Toledo, OH  43606	 	 
	Lancaster Commons
	 	2489 Coral Avenue NE
	 	$11,300,000
	 
	 	Salem, OR  97305	 	 
	Sugar Mill Creek
	 	8500 Belcher Road
	 	$10,600,000
	 
	 	Pinellas Park, FL  33781	 	 
	Tualatin Heights
	 	9301 SW Sagert Road
	 	$14,575,000
	 
	 	Tualatin, OR  97062	 	 
	Alexander Court
	 	135 Reynoldsburg-New Albany Road
	 	$18,520,550
	 
	 	Reynoldsburg, OH  43068	 	 







A-1 









 






	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Meadows at Kildaire
	 	2600 Harvest Creek Place	 	$20,109,220
	 
	 	Apex, NC  27539	 	 
	Carrington Hills
	 	4268 South Carothers Road
	 	$24,900,000
	 
	 	Franklin, TN	 	 
	Colonnade
	 	4100 Central Pike
	 	$20,250,000
	 
	 	Nashville, TN	 	 







A-2 









 





EIGHTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT



THIS EIGHTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is made as of
the 1st day of July, 2005 by and among (i) (a) UNITED DOMINION REALTY TRUST, INC., a
Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited partnership
(“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
(“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability
company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited partnership
(“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership (“UDR
NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership (“AAC”), (h)
HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage Communities”), (i) UDR
TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR Texas”), and (j) UDR of
TENNESSEE, L.P., a Virginia limited partnership (“UDR Tennessee”) (individually and
collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities, UDR
Texas and UDR Tennessee, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a
California limited partnership (“Lender”).




RECITALS



A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001, (as
amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed to
the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14, 2002,
Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of January
14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned by
Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo Heights L.L.C.,
an Arizona limited liability company (“Contempo Heights”) joined into the Master Agreement
as if each were an Original Borrower.




 









 







E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21, 2002,
Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of March
21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage owned
by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by
AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews LP,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of May
14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased by,
$150,000,000.00.



I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement dated as
of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to the
rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place, Smith
Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and obligations of
South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii) the addition of
the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and (b) Meadows at
Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the Mortgaged Properties
known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews, owned by Jamestown of
St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by AAC, from the Collateral
Pool, and (iv) the release of Jamestown of St. Matthews LP from each of the Loan Documents as a
Borrower.



J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement dated as
of December 1, 2004 to reflect the release of the Mortgaged Properties known as Brandywine Creek,
owned by AAC, and Stonegate, owned by UDR Texas, from the Collateral Pool.



K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of December 8,
2004, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.




2









 







L. Borrower entered into that certain Seventh Amendment to Master Credit Facility Agreement dated
as of December 8, 2004 to reflect (i) the addition of the Mortgaged Properties commonly known as
Carrington Hills, owned by UDR, and Colonnade, owned by UDR Tennessee to the Collateral Pool, and
(ii) the release of the Mortgaged Properties known as Lancaster Lakes, owned by AAC, and Nemoke
Trail, owned by AAC, from the Collateral Pool, and (iii) the modification of other terms of the
Master Agreement as set forth therein.



M. All of the Lender’s right, title and interest in the Master Agreement and the Loan Documents
executed in connection with the Master Agreement or the transactions contemplated by the Master
Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



N. Pursuant to the terms of the Master Agreement, Borrower intends to release that certain
Mortgaged Property commonly known as The Summit (the “Release Property”) from the
Collateral Pool and add that certain multifamily Residential Property commonly known as Sierra
Canyon (the “Additional Property”) to the Collateral Pool, thereby effecting a substitution
of Collateral (the “Substitution”). The terms and provisions of the Master Agreement
require that the Substitution occur simultaneously.



O. Subject to the terms of and conditions of that certain Escrow Agreement by and between Borrower,
Lender and Fannie Mae dated as of even date herewith (the “Escrow Agreement”), Lender has
agreed to permit Borrower to release the Release Property prior to the addition of the Additional
Property provided that Borrower comply with the terms of the Escrow Agreement.



P. The parties are executing this Amendment to the Master Agreement to reflect (i) the release of
the Release Property, owned by Smith Summit, from the Collateral Pool, and (ii) the addition of the
Additional Property, owned by UDR, to the Collateral Pool.



NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:




     Section 13. Release of Mortgaged Property. The Release Property is hereby released
from the Collateral Pool under the Master Agreement in accordance with the terms of the Escrow
Agreement.



     Section 14. Addition of Mortgaged Property. The Additional Property is hereby added to
the Collateral Pool as an additional Mortgaged Property under the Master Agreement in accordance
with the terms of the Escrow Agreement.



     Section 15. Exhibit A. Exhibit A to the Master Agreement is hereby deleted in
its entirety and replaced with Exhibit A to this Amendment.



3









 





     Section 4. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 5. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 6. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 7. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




4









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




	 	 	 	 	 	 	 	 	 	 	 
	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	Title:	 	 Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	 /s/ Rodney A. Neuheardt
 


Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	 Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




5









 








	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:

Name:
	 	/s/ Rodney A. Neuheardt
 

 Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	 Senior Vice President -Finance & Treasurer	 	 






[Signatures Continue]




6









 








	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, its Managing Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	 Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	ASR INVESTMENTS CORPORATION, a Maryland corporation, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Rodney A. Neuheardt
 

 Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	 Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 




[Signatures Continue]




7









 








	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 





[Signatures Continue]




8










 





	 	 	 	 	 	 	 	 	 
	 	 	LENDER	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited
partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty,
Inc., a California Corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Larry R. Sneathern
 

	 	 
	 

	 	 	 	Name:
	 	Larry R. Sneathern
 

	 	 
	 

	 	 	 	Title:
	 	Senior Vice President
 

	 	 






9









 






EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village

	 	200 Bicentennial Circle

Sacramento, CA 95826
	 	$	44,800,000	 
	 
	 	 	 	 	 	 
	Aspen Court

	 	2305 Ashcroft

Arlington, TX 76006
	 	$	5,700,000	 
	 
	 	 	 	 	 	 
	Braesridge

	 	11100 Braesridge

Houston, TX 77071
	 	$	14,650,00	 
	 
	 	 	 	 	 	 
	Crown Pointe

	 	3788 NE 4th Street

Renton, WA 98056
	 	$	11,900,000	 
	 
	 	 	 	 	 	 
	Derby Park

	 	606 W. Safari Parkway

Grand Prairie, TX 75050
	 	$	15,900,000	 
	 
	 	 	 	 	 	 
	Hilltop

	 	500 Monroe Avenue NE

Renton, WA 98056
	 	$	11,000,000	 
	 
	 	 	 	 	 	 
	Riverwood

	 	1045 Holcomb Bridge Road

Roswell, GA 30076
	 	$	16,750,000	 
	 
	 	 	 	 	 	 
	Summit Ridge

	 	1604 Ridge Haven Drive

Arlington, TX 76011
	 	$	11,000,000	 
	 
	 	 	 	 	 	 
	Village at Cliffdale

	 	567 Cutchen Lane

Fayetteville, NC 28314
	 	$	16,500,000	 
	 
	 	 	 	 	 	 
	Beaumont

	 	8504 82nd Street, S.W.

Lakewood, WA 98498
	 	$	15,200,000	 
	 
	 	 	 	 	 	 
	Chelsea Park

	 	11000 Crescent Moon

Houston, TX 77064
	 	$	7,700,000	 
	 
	 	 	 	 	 	 
	Country Club Place

	 	1111 Golfview

Richmond, TX 77469
	 	$	7,000,000	 
	 
	 	 	 	 	 	 
	Dunwoody Pointe

	 	7901 Roswell Road

Atlanta, GA 30350
	 	$	14,100,000	 
	 
	 	 	 	 	 	 
	Trinity Park

	 	5301 Creek Ridge Lane

Raleigh, NC 27607
	 	$	22,540,000	 
	 
	 	 	 	 	 	 
	Arbor Terrace I

	 	1800 Sidney Avenue

Port Orchard, WA 98366
	 	$	7,913,043	 
	 
	 	 	 	 	 	 
	Arbor Terrace II

	 	1790 Sidney Avenue

Port Orchard, WA 98366
	 	$	6,086,957	 
	 
	 	 	 	 	 	 
	Foothills Tennis Village

	 	5 Marcia Way

Roseville, CA 95747
	 	$	22,600,000	 
	 
	 	 	 	 	 	 
	Jamestown of Toledo

	 	3215 Milstead Drive

Toledo, OH 43606
	 	$	7,300,000	 
	 
	 	 	 	 	 	 
	Lancaster Commons

	 	2489 Coral Avenue NE

Salem, OR 97305
	 	$	11,300,000	 






A-1









 






	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Sugar Mill Creek

	 	8500 Belcher Road

Pinellas Park, FL 33781
	 	$	10,600,000	 
	 
	 	 	 	 	 	 
	Tualatin Heights

	 	9301 SW Sagert Road

Tualatin, OR 97062
	 	$	14,575,000	 
	 
	 	 	 	 	 	 
	Alexander Court

	 	135 Reynoldsburg-New

Albany Road

Reynoldsburg, OH 43068
	 	$	18,520,550	 
	 
	 	 	 	 	 	 
	Meadows at Kildaire

	 	2600 Harvest Creek Place

Apex, NC 27539
	 	$	20,109,220	 
	 
	 	 	 	 	 	 
	Carrington Hills

	 	4268 South Carothers Road

Franklin, TN 37067
	 	$	24,900,000	 
	 
	 	 	 	 	 	 
	Colonnade

	 	4100 Central Pike

Nashville, TN
	 	$	20,250,000	 
	 
	 	 	 	 	 	 
	Sierra Canyon

	 	17500 North 67th Avenue

Glendale, Arizona 85308
	 	To Be Supplemented







A-2









 






NINTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS NINTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is
effective as of the 30th day of September, 2005 by and among (i) (a) UNITED DOMINION REALTY TRUST,
INC., a Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California limited
partnership (“Woodlake”) (individually and collectively, UDRT and Woodlake, “Original
Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
(“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability
company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited partnership
(“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership (“UDR
NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership (“AAC”), (h)
HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage Communities”), (i) UDR
TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR Texas”), and (j) UDR of
TENNESSEE, L.P., a Virginia limited partnership (“UDR Tennessee”) (individually and
collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities, UDR
Texas and UDR Tennessee, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a
California limited partnership (“Lender”).



RECITALS




A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001, (as
amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed to
the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14, 2002,
Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of January
14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned by
Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo Heights L.L.C.,
an Arizona limited liability company (“Contempo Heights”) joined into the Master Agreement
as if each were an Original Borrower.



 









 








E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21, 2002,
Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of March
21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage owned
by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine owned by
AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews LP,
Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster Commons
owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by AAC, and
Tualatin Heights owned by UDR, to the Collateral Pool.



H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of May
14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased by,
$150,000,000.00.



I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement dated as
of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to the
rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place, Smith
Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and obligations of
South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii) the addition of
the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and (b) Meadows at
Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the Mortgaged Properties
known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews, owned by Jamestown of
St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by AAC, from the Collateral
Pool, and (iv) the release of Jamestown of St. Matthews LP from each of the Loan Documents as a
Borrower.



J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement dated as
of December 1, 2004 to reflect the release of the Mortgaged Properties known as Brandywine Creek,
owned by AAC, and Stonegate, owned by UDR Texas, from the Collateral Pool.



K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of December 8,
2004, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.



2









 








L. Borrower entered into that certain Seventh Amendment to Master Credit Facility Agreement dated
as of December 8, 2004 to reflect (i) the addition of the Mortgaged Properties commonly known as
Carrington Hills, owned by UDR, and Colonnade, owned by UDR Tennessee to the Collateral Pool, and
(ii) the release of the Mortgaged Properties known as Lancaster Lakes, owned by AAC, and Nemoke
Trail, owned by AAC, from the Collateral Pool, and (iii) the modification of other terms of the
Master Agreement as set forth therein.



M. Borrower entered into that certain Eighth Amendment to Master Credit Facility
Agreement dated as of July 1, 2005 to reflect (i) the addition of the Mortgaged Property commonly
known as Sierra Canyon, owned by UDR, to the Collateral Pool, and (ii) the release of the Mortgaged
Property known as The Summit, owned by Heritage Communities, from the Collateral Pool.



N. All of the Lender’s right, title and interest in the Master Agreement and the Loan Documents
executed in connection with the Master Agreement or the transactions contemplated by the Master
Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



O. The parties are executing this Amendment to the Master Agreement to reflect the modification of
certain terms of the Master Agreement as set forth herein.



NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 1. Financial Definitions. Section 15.01 of the Master Agreement is hereby
deleted in its entirety and restated as follows:




     “1031 Property” means property held by a “qualified intermediary” in connection
with the sale of such property by the Borrower, a Subsidiary or Unconsolidated Affiliate
pursuant to, and qualifying for tax treatment under, Section 1031 of the Internal Revenue
Code.




     “Condominium Property” means a Multifamily Property that has been converted
into residential condominium units for the purpose of sale. For purposes of this definition
and the definition of “Condominium Property Value” a Multifamily Property will be deemed
“converted” into residential condominium units once both of the following have occurred: (a)
notice of the conversion has been sent to the tenants of such Property; and (b) a
declaration of condominium or other similar document is filed with the applicable
Governmental Authority.




     “Condominium Property Value” means the sum of the following: (a) the
Consolidated Net Operating Income attributable to such Property for the two quarter



3









 






period annualized ending immediately prior to such conversion divided by 7.50%, plus
(b) the cost of capital improvements made to such Property in connection with such
conversion not to exceed 35% of the amount determined in accordance with the preceding
clause (a), minus (c) 90% of the actual contractual sales price of each individual
condominium unit sale prior to any deductions for commissions, fees and any other expenses;
provided, however, no value will be attributed to such a Condominium Property 24 months
after its conversion. In addition, no value shall be attributable to a Condominium Property
at any time following the earlier of (x) all condominium units of such Property having been
sold or otherwise conveyed, (y) the management of such Property having been turned over to
such Property’s homeowners’ association and (z) less than 10% of the units remain unsold.




     “Consolidated Adjusted EBITDA” means for any period the Consolidated Group the
sum of Consolidated EBITDA for such period minus a reserve equal to $62.50 per apartment
unit per quarter ($250 per apartment unit per year). Except as expressly provided otherwise,
the applicable period shall be for the single fiscal quarter ending as of the date of
determination.




     “Consolidated Adjusted Tangible Net Worth” means at any rate:




     (iii) the sum of (A) the consolidated shareholders equity of the Consolidated
Group (net of Minority Interests) plus (B) accumulated depreciation of real estate
owned to the extent reflected in the then book value of the Consolidated Assets,
minus without duplication




     (iv) the Intangible Assets of the Consolidated Group.




     “Consolidated Assets” means the assets of the members of the Consolidated Group
determined in accordance with GAAP on a consolidated basis.




     “Consolidated EBITDA” means for any period for the Consolidated Group,
Consolidated Net Income (including Consolidated Net Income attributable to units of
Condominium Properties prior to the sale thereof) excluding the following amounts (but only
to the extent included in determining Consolidated Net Income for such period) (a)
Consolidated Interest Expense; (b) all provisions for any Federal, state or other income
taxes; (c) depreciation, amortization and other non-cash charges; (d) gains and losses on
Investments and extraordinary gains and losses; (e) taxes on such excluded gains and tax
deductions or credits on account of such excluded losses, in each case on a consolidated
basis determined in accordance with GAAP; and (f) to the extent not already included in the
immediately preceding clauses (b) through (e), the Borrower’s pro rata share of such items
of each Unconsolidated Affiliate of the Borrower for such period. Consolidated EBITDA shall
include gain or loss, in either case, realized on the sale of any portion of a Condominium
Property (without duplication of income on condominium units).




     “Consolidated Funded Debt” means total Debt of the Consolidated Group on a
consolidated basis determined in accordance with GAAP (excluding (i) Debt consisting of
contingent liabilities retained by the Borrower related to the sale of Hunting Ridge,



4









 






Woodside and Twin Coves in an aggregate amount not to exceed $20,000,000 and (ii) the
aggregate amount, not to exceed $20,000,000, available to be drawn under letters of credit
issued in respect of normal operating expenses of such Person) plus the Borrower’s
pro rata share of the Debt of any Unconsolidated Affiliate of the Borrower.




     “Consolidated Group” means the Borrower and its consolidated Subsidiaries, as
determined in accordance with GAAP.




     “Consolidated Interest Expense” means for any period for the Consolidated
Group, (a) all interest expense, including the amortization of debt discount and premium,
the interest component under capital leases and capitalized interest expense (other than
capitalized interest funded from a construction loan interest reserve account held by
another lender and not included in the calculation of cash for balance sheet reporting
purposes), in each case on a consolidated basis determined in accordance with GAAP
plus (b) to the extent not already included in the foregoing clause (a), the
Borrower’s pro rata share of all interest expense (determined in a manner consistent with
this definition of Consolidated Interest Expense) for such period of Unconsolidated
Affiliates of the Borrower.




     “Consolidated Net Income” means for any period, the net income of the
Consolidated Group on a consolidated basis determined in accordance with GAAP, including the
Borrower’s pro rata share of the net income of each Unconsolidated Affiliate of the Borrower
for such period.




     “Consolidated Net Operating Income” means, for any period for any Multifamily
Property owned by a member of the Consolidated Group or an Unconsolidated Affiliate, an
amount equal to (a) the aggregate rental and other income from the operation of such
Multifamily Property during such period; minus (b) all expenses and other proper
charges incurred in connection with the operation of such Multifamily Property (including,
without limitation, real estate taxes and bad debt expenses) during such period and an
imputed management fee in the amount of 3.0% of the aggregate rents received for such
Multifamily Property during such period; but, in any case, before payment of or provision
for debt service charges for such period, income taxes for such period, and depreciation,
amortization and other non-cash expenses for such period, all on a consolidated basis
determined in accordance with GAAP. For purposes of determining Consolidated Net Operating
Income, only the Borrower’s pro rata share of the Consolidated Net Operating Income of any
such Property owned by an Unconsolidated Affiliate of the Borrower shall be used.




     “Consolidated Secured Debt” means, as of any given date, all Consolidated
Funded Debt that is secured in any manner by any Lien.




     “Consolidated Total Fixed Charges” means for any period, the sum of (a) the
cash portion of Consolidated Interest Expense paid during such period plus (b)
regularly scheduled principal payments on Consolidated Funded Debt during such period
(excluding any balloon, bullet or similar principal payment payable on any Consolidated



5









 






Funded Debt which repays such Consolidated Funded Debt in full) plus (c) all
cash dividends and distributions on Preferred Equity Interests of members of the
Consolidated Group paid during such period, all on a consolidated basis determined in
accordance with GAAP.




     “Consolidated Unsecured Debt” means, as of a given date, all Consolidated
Funded Debt that is not Consolidated Secured Debt.




     “Debt” of any Person means at any date, without duplication, (a) all
obligations of such Person for borrowed money, (b) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (c) all obligations of such Person
to pay deferred purchase price of property or services (other than trade accounts payable
arising in the ordinary course of business), (d) all Capitalized Lease Obligations of such
Person; (e) all obligations of such Person to purchase securities or other property which
arise out of or in connection with the sale of the same or substantially similar securities
or property; (f) all obligations of such Person to reimburse any bank or other person in
respect of amounts payable under a letter of credit or similar instrument (being the amount
available to be drawn thereunder, whether or not then drawn); (g) all obligations of others
secured by a Lien on any asset of such Person, whether or not such obligation is assumed by
such Person; (h) all obligations of others Guaranteed by such Person; (i) all obligations
which in accordance with GAAP would be shown as liabilities on a balance sheet of such
Person or which arise in connection with forward equity transactions; and (j) all
obligations of such Person owning under any synthetic lease, tax retention operating lease,
off-balance sheet loan or similar off-balance sheet financing product to which such Person
is a party, where such transaction is considered borrowed money indebtedness for tax
purposes, but is classified as an operating lease in accordance with GAAP. Debt of any
Person shall include Debt of any partnership or joint venture in which such Person is a
general partner or joint venturer to the extent of such Person’s pro rata share of the
ownership of such partnership or joint venture (except if such Debt is recourse to such
Person, in which case the greater of such Person’s pro rata portion of such Debt or the
amount of the recourse portion of the Debt, shall be included as Debt of such Person). All
Loans and Letter of Credit Liabilities shall constitute Debt of the Borrower.




     “Development Property” means (i) a Property currently under development (or in
the pre-development phase) as a Multifamily Property and/or (ii) a Condominium Property.




     “Gross Asset Value” means from time to time the sum of the following amounts
(without duplication): (a) the product of (i) Consolidated Net Operating Income for the
period of two consecutive fiscal quarters most recently ended attributable to Multifamily
Properties (excluding any Properties covered by either of the immediately following clauses
(b) or (c) owned by any member of the Consolidated Group for such period, multiplied by (ii)
2 and divided by (iii) 7.50%; (b) the purchase price paid for any Multifamily Property
acquired by any member of the Consolidated Group during the period of six consecutive fiscal
quarters most recently ended (less any amounts paid as a



6









 






purchase price adjustment, held in escrow, retained as a contingency reserve, or other
similar arrangements); (c)(i) the Condominium Property Value of all Condominium Properties
owned by any member of the Consolidated Group, (ii) the current book value of any other
Development Property (or Multifamily Property that was a Development Property at any time
during the period of six consecutive fiscal quarters most recently ended) owned by any
member of the Consolidated Group and (iii) the Renovation Property Value of all Renovation
Properties owned by any member of the Consolidated Group; (d) unrestricted cash and cash
equivalents of the Consolidated Group; (e) the value (based on the lower of cost or market
price determined in accordance with GAAP) of any raw land owned by any member of the
Consolidated Group; (f) the value (based on the lower of cost or market price determined in
accordance with GAAP) of Properties owned by any member of the Consolidated Group that are
developed but that are not Multifamily Properties; (g) the value (based on the lower of cost
or market price determined in accordance with GAAP) of all Multifamily REIT Preferred
Interests; (h) the value (based on the lower of cost market price determined in accordance
with GAAP) of (i) all promissory notes, including any secured by a Mortgage, payable solely
to any member of the Consolidated Group and the obligors of which are not Affiliates of the
Borrower (excluding any such note where the obligor is more than 60 days past due with
respect to any payment obligation) and (ii) all marketable securities (excluding Marketable
Multifamily REIT Preferred Interests); and (i) the Borrower’s pro rata share of the
preceding items of any Unconsolidated Affiliate of the Borrower to the extent not already
included. Notwithstanding the foregoing, any determination of Gross Asset Value shall
exclude any Investments held by the Borrower or any Subsidiary.




     “Gross Asset Value of the Unencumbered Pool” means Gross Asset Value determined
with reference only to Unencumbered Pool Assets. Notwithstanding the foregoing, the
following amounts shall be excluded from Gross Asset Value of the Unencumbered Pool: (a)
the amount by which the value of Unencumbered Pool Assets owned by Subsidiaries that are not
Guarantors would, in the aggregate, account for more than 20.0% of Gross Asset Value of the
Unencumbered Pool; (b) the amount by which the value of the Unencumbered Pool Assets owned
by Subsidiaries are not Wholly Owned Subsidiaries would, in the aggregate, account for more
than 20.0% of Gross Asset Value of the Unencumbered Pool; and (c) the amount by which the
value of Unencumbered Pool Assets that are Investments and other assets would, in the
aggregate, account for more than 20.0% of the Gross Asset Value of the Unencumbered Pool;
provided, the limitations contained in the immediately preceding clauses (a) and (b) shall
not apply to 1031 Properties and the limitations contained in the immediately preceding
clause (c) shall not apply to promissory notes secured by first Mortgages. The aggregate
Occupancy Rate of Multifamily Properties and other Properties that are developed, but that
are not Multifamily Properties, must exceed 80.0%.




     “Intangible Assets” of any Person means at any date the amount of (i) all write
ups (other than write-ups resulting from write-ups of assets of a going concern business
made within twelve months after the acquisition of such business) in the book value of any
asset owned by such Person and (ii) all unamortized debt discount and expense, unamortized
deferred charges, capitalized start up costs, goodwill, patents, licenses,



7









 






trademarks, trade names, copyrights, organization or developmental expenses, covenants
not to compete and other intangible items.




     “Investment” means, (x) with respect to any Person, any acquisition or
investment (whether or not of a controlling interest) by such Person, by means of any of the
following: (a) the purchase or other acquisition of any equity interest in another Person,
(b) a loan, advance or extension of credit to, capital contribution to, guaranty of debt of,
or purchase or other acquisition of any Debt of, another Person, including any partnership
or joint venture interest in such other Person, or (c) the purchase or other acquisition (in
one transaction or a series of transactions) of assets of another Person that constitute the
business or a division or operating unit of another Person and (y) with respect to any
Mortgaged Property or other asset, the acquisition thereof. Any binding commitment to make
an investment in any other Person, as well as any option of another Person to require an
Investment in such Person, shall constitute an Investment. Except as expressly provided
otherwise, for purposes of determining compliance with any covenant contained in a Loan
Document, the amount of any Investment shall be the amount actually invested, without
adjustment for subsequent increases or decreases in the value of such Investment.




     “Marketable Multifamily REIT Preferred Interest” means a Multifamily REIT
Preferred Equity Interest: (a) having trading privileges on a national securities exchange
or that is subject to price quotations in the over-the-counter market and (b) not subject to
restrictions on the sale, transfer, assignment, hypothecation or other limitations, in each
case where such restriction would exceed 90 days from the time of purchase, that would
(whether contractual or under Applicable Law) otherwise prevent such Preferred Equity
Interest from being freely transferable by such member of the Consolidated Group; provided,
however, that this limitation shall not apply to Preferred Equity Interests that could be
sold pursuant to an available exemption under the Securities Act.




     “Multifamily REIT Preferred Interest” means any Preferred Equity Interest: (a)
owned by a member of the Consolidated Group and (b) issued by a REIT that (i) is not a
Subsidiary and (ii) owns primarily apartment communities.




     “Minority Interest” means any shares of stock (or other equity interests) of
any class of a Subsidiary (other than directors’ qualifying shares as required by law) that
are not owned by the Borrower and/or one or more Wholly Owned Subsidiaries. Minority
Interests constituting preferred stock shall be valued at the voluntary or involuntary
liquidation value of such preferred stock, whichever is greater, and by valuing common stock
at the book value of the capitalized surplus applicable thereto adjusted by the foregoing
method of valuing Minority Interests in preferred stock.




     “Multifamily Property” means any Real Property on which the improvements
consist primarily of an apartment community.




     “Real Property” means any parcel of real property owned or leased (in whole or
in part) or operated by the Borrower, any Subsidiary or any Unconsolidated Affiliate of



8









 






the Borrower and which is located in a state of the United States of America or the
District of Columbia.




     “Realty” means all real property and interests therein, together with all
improvements thereon.




     “Renovation Property” mean a Property on which the existing building or other
improvements or a portion thereof are undergoing renovation and redevelopment that will
either (a) disrupt the occupancy of at least 30% of the square footage of such Property or
(b) temporarily reduce the Consolidated Net Operating Income attributable to such Property
by more that 30% as compared to the immediately preceding comparable prior period. A
Property shall cease to be a Renovation Property upon the earliest to occur of (i) all
improvements (other than tenant improvements on unoccupied space) related to the
redevelopment of such Property having been substantially completed and (ii) once such
Property has achieved an Occupancy Rate of 80.0% or more.




     “Renovation Property Value” means for a Renovation Property, the sum of the
following: (a) the Consolidated Net Operating Income attributable to such Property for the
two quarter period annualized ending immediately prior to the commencement of such
renovation and redevelopment divided by 7.50%, plus (b) the cost of capital improvements
made to such Property in connection with such renovation and redevelopment not to exceed 35%
of the amount determined in accordance with the preceding clause (a); provided, however, (i)
the value of (a) plus (b) above does not exceed 80% of the Borrower’s good faith
determination of the pro forma Consolidated Net Operating Income of such Renovation Property
(assuming the completion of all applicable renovation and redevelopment) divided by 7.50%
and (ii) 18 months following the commencement of such renovation and redevelopment such
property will cease to be a Renovation Property.




     “Unconsolidated Affiliate” means, with respect to any Person, any other Person
in whom such Person holds an Investment, which Investment is accounted for in the financial
statements of such Person on an equity basis of accounting and whose financial results would
not be consolidated under GAAP with the financial results of such Person on the consolidated
financial statements of such Person.




     “Unencumbered Pool Asset” means any asset owned by a member of the Consolidated
Group or an Unconsolidated Affiliate of the Borrower and that satisfies all of the following
requirements: (a) such asset is either (i) a Multifamily Property, (ii) a Property that is
developed but that is not a Multifamily Property, (iii) a Development Property or a
Renovation Property, (iv) raw land, (v) promissory notes (vi) marketable securities
(including Marketable Multifamily REIT Preferred Interests) and (vii) Multifamily REIT
Preferred Interests; (b) neither such asset, nor any interest of any member of the
Consolidated Group or Unconsolidated Affiliate therein, is subject to any Lien (other than
Permitted Liens of the types described in clauses (a) through (c) of the definition thereof)
or to any Negative Pledge; (c) if such asset is owned by Person other than the Borrower (i)
none of the Borrower’s direct or indirect ownership interest in such



9









 






Person is subject to any Lien (other than Permitted Liens of the types described in
clauses (a) through (c) of the definition thereof) or to any Negative Pledge; and (ii) the
Borrower directly, or indirectly through a Subsidiary, has the right to take the following
actions without the need to obtain the consent of any Person: (x) sell, transfer or
otherwise dispose of such asset and (y) to create a Lien on such asset as security for Debt
of the Borrower or such Guarantor, as applicable; (d) if such asset is owned by a Subsidiary
or Unconsolidated Affiliate which is not a Guarantor (i) the Borrower directly, or
indirectly through other Subsidiaries, owns at least 51.0% of all outstanding Equity
Interests of such Person; and (ii) such Person is not an obligor with respect to any Debt
(other than unsecured Debt of the type set forth in clauses (c) and (d) of the definition of
the term Debt), provided however, 1031 Properties will not be subject to the limitations
contained in subclauses (i) and (ii) of this clause (d); and (e) in the case of a Property,
such Property is free of all structural defects or major architectural deficiencies (if
developed), title defects, environmental conditions or other adverse matters which,
individually or collectively, materially impair the value of such Property.




     “Wholly Owned Subsidiary” means as to any person, any Subsidiary all of the
voting stock or other similar voting interest are owned directly or indirectly by such
Person. Unless otherwise provided, references to “Wholly Owned Subsidiary” shall mean Wholly
Owned Subsidiaries of the Borrower.



     Section 2. Consolidated Adjusted Tangible Net Worth. Section 15.05 of the Master
Agreement is hereby deleted in its entirety and replaced with the following:




     “SECTION 15.05 Consolidated Adjusted Tangible Net Worth. Consolidated
Adjusted Tangible Net Worth will not at any time be less than $1,200,000,000.”



     Section 3. Consolidated Funded Debt Ratio. Section 15.06 of the Master Agreement is
hereby deleted in its entirety and replaced with the following:




     “SECTION 15.06 Consolidated Funded Debt Ratio. The ratio of (i) Consolidated
Funded Debt to (ii) Gross Asset Value, will not exceed 0.625 to 1.0 at any time; provided,
however, that if such ratio is greater than 0.625 to 1.0 but less than 0.675 to 1.0, then
such failure to comply with the foregoing covenant shall not constitute a Default or Event
of Default so long as such ratio ceases to exceed 0.625 to 1.00 within 180 days following
the date such ratio first exceeded 0.625 to 1.00.”



     Section 4. Consolidated Unsecured Debt to Gross Asset Value of the Unencumbered Pool.
Section 15.08 of the Master Agreement is hereby deleted in its entirety and replaced with the
following:




     “SECTION 15.08 Consolidated Unsecured Debt to Gross Asset Value of the
Unencumbered Pool. The ratio of (i) Gross Asset Value of the
Unencumbered Pool to (ii) Consolidated Unsecured Debt, will not be less than 1.50 to
1.00 at the end of any fiscal quarter.”



     Section 5. Consolidated Unencumbered Interest Coverage Ratio. Section 15.09 of the
Master Agreement is hereby deleted in its entirety and replaced with the following:



10









 





“[INTENTIONALLY DELETED]”




     Section 6. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 7. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 8. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 9. Applicable Law. The provisions of Section 23.06 of the Master Agreement
(entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby incorporated
into this Amendment by this reference to the fullest extent as if the text of such provisions were
set forth in their entirety herein.



[Signatures follow on next page]




11









 








IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.



	 	 	 	 	 	 	 	 	 	 	 
	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 
	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its
General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited
liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation,
its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




12









 








	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,
a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware
corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited
partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE
4 LLC, a Delaware limited liability company, its General
Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited
partnership, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a
Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:
Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	 Senior Vice President — Finance
& Treasurer	 	 






[Signatures Continue]




13









 








	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II,
INC., a Delaware corporation, its Managing Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE
LLC, a Delaware limited liability company, its General
Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	ASR INVESTMENTS CORPORATION, a Maryland
corporation, its Sole Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
Name:
	 	/s/ Rodney A. Neuheardt
 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	 	 	Title:
	 	Senior Vice President — Finance &
Treasurer	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN
RESIDENTIAL, INC., a Virginia corporation, its General
Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Rodney A. Neuheardt	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Rodney A. Neuheardt	 	 
	 	 	 	 	Title:	 	Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




14









 








	 	 	 	 	 	 	 	 	 
	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Rodney A. Neuheardt	 	 
	 

	 	 	 	Name:
	 	 

Rodney A. Neuheardt
	 	 
	 

	 	 	 	Title:
	 	Senior Vice President — Finance & Treasurer	 	 






[Signatures Continue]




15









 








	 	 	 	 	 	 	 	 	 
	 	 	LENDER	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited
partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty,
Inc., a California Corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Timothy L. White
 

	 	 
	 

	 	 	 	Name:
	 	Timothy L. White
 

	 	 
	 

	 	 	 	Title:
	 	Executive V.P. / COO
 

	 	 







16









 





TENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS TENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is
effective as of the 3rd day of July, 2006 by and among (i) (a) UNITED DOMINION REALTY
TRUST, INC., a Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California
limited partnership (“Woodlake”) (individually and collectively, UDRT and Woodlake,
“Original Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited
liability company (“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington
limited liability company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited
partnership (“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited
partnership (“UDR NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership
(“AAC”), (h) HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage
Communities”), (i) UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR
Texas”), and (j) UDR of TENNESSEE, L.P., a Virginia limited partnership (“UDR
Tennessee”) (individually and collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR
NC, AAC, Heritage Communities, UDR Texas and UDR Tennessee, “Borrower”) and (ii) ARCS
COMMERCIAL MORTGAGE CO., L.P., a California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(as amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed
to the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned
by Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



     D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo



 









 







Heights L.L.C., an Arizona limited liability company (“Contempo Heights”) joined into
the Master Agreement as if each were an Original Borrower.



     E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



     F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21,
2002, Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



     G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of
March 21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage
owned by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine
owned by AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews
LP, Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster
Commons owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by
AAC, and Tualatin Heights owned by UDR, to the Collateral Pool.



     H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of
May 14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased
by, $150,000,000.00.



     I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement
dated as of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to
the rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place,
Smith Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and
obligations of South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii)
the addition of the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and
(b) Meadows at Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the
Mortgaged Properties known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews,
owned by Jamestown of St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by
AAC, from the Collateral Pool, and (iv) the release of Jamestown of St. Matthews LP from each of
the Loan Documents as a Borrower.



     J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement
dated as of December 1, 2004 to reflect the release of the Mortgaged Properties known as Brandywine
Creek, owned by AAC, and Stonegate, owned by UDR Texas, from the Collateral Pool.



2









 





     K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of December 8,
2004, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.



     L. Borrower entered into that certain Seventh Amendment to Master Credit Facility Agreement
dated as of December 8, 2004 to reflect (i) the addition of the Mortgaged Properties commonly known
as Carrington Hills, owned by UDR, and Colonnade, owned by UDR Tennessee to the Collateral Pool,
and (ii) the release of the Mortgaged Properties known as Lancaster Lakes, owned by AAC, and Nemoke
Trail, owned by AAC, from the Collateral Pool, and (iii) the modification of other terms of the
Master Agreement as set forth therein.



     M. Borrower entered into that certain Eighth Amendment to Master Credit Facility
Agreement dated as of July 1, 2005 to reflect (i) the addition of the Mortgaged Property commonly
known as Sierra Canyon, owned by UDR, to the Collateral Pool, and (ii) the release of the Mortgaged
Property known as The Summit, owned by Heritage Communities, from the Collateral Pool.



     N. Borrower entered into that certain Ninth Amendment to Master Credit Facility Agreement
dated as of September 30, 2005 to reflect the modification of certain terms of the Master Agreement
as set forth therein.



     O. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     P. The parties are executing this Amendment to the Master Agreement to reflect a conversion of
a portion of the Revolving Facility Commitment to the Base Facility Commitment.



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 16. Conversion. The Revolving Facility Commitment shall be reduced by, and
the Base Facility Commitment shall be increased by, $35,487,000, and the definitions of Base
Facility Commitment and Revolving Facility Commitment are hereby replaced in their entirety with
the following new definitions:




     “Base Facility Commitment” means $260,487,000 plus such amount as the Borrower
may elect to add to the Base Facility Commitment in accordance with Article III or
VIII.



3









 






     “Revolving Facility Commitment” means an aggregate amount of $39,513,000,
evidenced by the Revolving Facility Note in the form attached hereto as Exhibit I,
plus such amount as the Borrower may elect to add to the Revolving Facility Commitment in
accordance with Article VIII, and less such amount as the Borrower may elect to
convert from the Revolving Facility Commitment to the Base Facility Commitment in accordance
with Article III and less such amount by which the Borrower may elect to reduce the
Revolving Facility Commitment in accordance with Article IX.



     Section 17. Base Facility Fee. The definition of “Base Facility Fee” is hereby
replaced in its entirety with the following new definition:




     “Base Facility Fee” means (i) 50 basis points per annum (0.50%) with respect to
the Base Facility Advances evidenced by (a) that certain Base Facility Note dated as of May
14, 2002 in the original principal amount of $100,000,000, and (b) that certain Base
Facility Note dated as of May 14, 2002 in the original principal amount of $50,000,000, (ii)
35 basis points per annum (0.35%) with respect to the Base Facility Advances evidenced by
(a) that certain Base Facility Note (titled “Multifamily Revolving Facility Note”) effective
as of December 1, 2005 in the original principal amount of $75,000,000 and (b) that certain
Base Facility Note dated as of July 3, 2006 in the original principal amount of $35,487,000,
and (iii) for any Base Facility Advance drawn from any portion of the Base Facility
Commitment increased under Article VIII or converted from any portion of the Revolving
Facility Commitment after July 3, 2006, the number of basis points determined at the time of
such increase by the Lender as the Base Facility Fee for such Base Facility Advances,
provided that in no event shall the Base Facility Fee for Base Facility Advances converted
from the Revolving Facility Commitment (expressed as a number of basis points) exceed the
Revolving Facility Fee.



     Section 18. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 19. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 20. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 21. Applicable Law. The provisions of Section 23.06 of the Master
Agreement (entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby
incorporated into this Amendment by this reference to the fullest extent as if the text of such
provisions were set forth in their entirety herein.



[Signatures follow on next page]




4









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 
	 	 	BORROWER
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Justin R. Sato
	 	 	 	 	 
	 	 	Name:	 	Justin R. Sato
	 	 	Title:	 	Vice President
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware
	 	 	 	 	limited partnership, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST,
	 	 	 	 	 	 	INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	/s/ Justin R. Sato
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name:	 	Justin R. Sato
	 	 	 	 	 	 	Title:	 	Vice President
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a
	 	 	Washington limited liability company
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation,
	 	 	 	 	its Administrative Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato
	 	 	 	 	Title:	 	Vice President






[Signatures Continue]




5









 








	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,	 	 
	 	 	a Washington limited liability company	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware	 	 
	 	 	 	 	corporation, its Administrative Member	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato	 	 
	 	 	 	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,	 	 
	 	 	 	 	a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato	 	 
	 	 	 	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North 	 	 
	 	 	Carolina limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited	 	 
	 	 	 	 	liability company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited
	 	 	 	 	 	 	partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY 	 	 
	 	 	 	 	 	 	 	 	TRUST, INC., a Maryland corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	Name:	 	Justin R. Sato	 	 
	 	 	 	 	 	 	 	 	Title:	 	Vice President	 	 






[Signatures Continue]




6









 








	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, 
its Managing Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato	 	 	 	 
	 	 	 	 	Title:	 	Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability	 	 
	 	 	 	 	company, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	ASR INVESTMENTS CORPORATION, a Maryland
	 	 	 	 	 	 	corporation, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Name:	 	Justin R. Sato	 	 	 	 
	 	 	 	 	 	 	Title:	 	Vice President	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia	 	 
	 	 	 	 	corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato	 	 	 	 
	 	 	 	 	Title:	 	Vice President	 	 	 	 






[Signatures Continue]




7









 








	 	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
	 	 	 	 	a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Justin R. Sato	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Justin R. Sato	 	 	 	 
	 	 	 	 	Title:	 	Vice President	 	 	 	 






[Signatures Continue]





8










 






	 	 	 	 	 	 	 	 	 
	 	 	LENDER	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty,
Inc., a California Corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Timothy L. White
 
	 	 
	 

	 	 	 	Name:
	 	Timothy L. White

	 	 
	 

	 	 	 	Title:
	 	Executive Vice President
	 	 
	 

	 	 	 	 	 	 

	 	 






9









 





ELEVENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT




     THIS ELEVENTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this “Amendment”) is
effective as of the 11th day of August, 2006 by and among (i) (a) UNITED DOMINION REALTY
TRUST, INC., a Maryland corporation (“UDRT”), (b) WOODLAKE VILLAGE, L.P., a California
limited partnership (“Woodlake”) (individually and collectively, UDRT and Woodlake,
“Original Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited
liability company (“Crown Pointe”), (d) AAC/FSC HILLTOP INVESTORS, LLC, a Washington
limited liability company (“Hilltop”), (e) UNITED DOMINION REALTY, L.P., a Delaware limited
partnership (“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited
partnership (“UDR NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware general partnership
(“AAC”), (h) HERITAGE COMMUNITIES L.P., a Delaware limited partnership (“Heritage
Communities”), (i) UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership (“UDR
Texas”), and (j) UDR of TENNESSEE, L.P., a Virginia limited partnership (“UDR
Tennessee”) (individually and collectively, Original Borrower, Crown Pointe, Hilltop, UDR, UDR
NC, AAC, Heritage Communities, UDR Texas and UDR Tennessee, “Borrower”) and (ii) ARCS
COMMERCIAL MORTGAGE CO., L.P., a California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(as amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed
to the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned
by Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



     D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”), Heritage –
Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”), Heritage – Country Club
Place L.P., an Arizona limited partnership (“Country Club”), and Contempo



 









 







Heights L.L.C., an Arizona limited liability company (“Contempo Heights”) joined into
the Master Agreement as if each were an Original Borrower.



     E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



     F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21,
2002, Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



     G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of
March 21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage
owned by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine
owned by AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews
LP, Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster
Commons owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by
AAC, and Tualatin Heights owned by UDR, to the Collateral Pool.



     H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of
May 14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased
by, $150,000,000.00.



     I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement
dated as of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to
the rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place,
Smith Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and
obligations of South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii)
the addition of the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and
(b) Meadows at Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the
Mortgaged Properties known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews,
owned by Jamestown of St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by
AAC, from the Collateral Pool, and (iv) the release of Jamestown of St. Matthews LP from each of
the Loan Documents as a Borrower.



     J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement
dated as of December 1, 2004 to reflect the release of the Mortgaged Properties known as Brandywine
Creek, owned by AAC, and Stonegate, owned by UDR Texas, from the Collateral Pool.



2









 





     K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of December 8,
2004, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.



     L. Borrower entered into that certain Seventh Amendment to Master Credit Facility Agreement
dated as of December 8, 2004 to reflect (i) the addition of the Mortgaged Properties commonly known
as Carrington Hills, owned by UDR, and Colonnade, owned by UDR Tennessee to the Collateral Pool,
and (ii) the release of the Mortgaged Properties known as Lancaster Lakes, owned by AAC, and Nemoke
Trail, owned by AAC, from the Collateral Pool, and (iii) the modification of other terms of the
Master Agreement as set forth therein.



     M. Borrower entered into that certain Eighth Amendment to Master Credit Facility
Agreement dated as of July 1, 2005 to reflect (i) the addition of the Mortgaged Property commonly
known as Sierra Canyon, owned by UDR, to the Collateral Pool, and (ii) the release of the Mortgaged
Property known as The Summit, owned by Heritage Communities, from the Collateral Pool.



     N. Borrower entered into that certain Ninth Amendment to Master Credit Facility Agreement
dated as of September 30, 2005 to reflect the modification of certain terms of the Master Agreement
as set forth therein.



     O. Borrower entered into that certain Tenth Amendment to Master Credit Facility Agreement
dated as of July 3, 2006 to reflect a conversion of a portion of the Revolving Facility Commitment
to the Base Facility Commitment.



     P. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     Q. The parties are executing this Amendment to the Master Agreement to reflect (i) the release
from the Collateral Pool of the Mortgaged Property commonly known as The Village at Cliffdale,
located in Fayetteville County, North Carolina, and (ii) the addition to the Collateral Pool of the
Mortgaged Property commonly known as Green Tree Place, located in Duval County, Florida (the
“Green Tree Property”).



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 22. Release of Mortgaged Property. The Mortgaged Property commonly known as
The Village at Cliffdale, located in Fayetteville County, North Carolina, is hereby released from
the Collateral Pool under the Master Agreement.



3









 





     Section 23. Addition of Mortgaged Property. The Green Tree Property is hereby added
to the Collateral Pool under the Master Agreement.



     Section 24. Amendment to Exhibit A. Exhibit A to the Master Agreement is
hereby deleted in its entirety and replaced with the Exhibit A attached hereto.



     Section 25. Special Representations with Respect to Green Tree Property. Borrower
shall indemnify, hold harmless and defend Lender and its successors or assigns from and against all
proceedings, claims, damages, fees, and costs, including reasonable attorneys fees and expenses,
arising directly or indirectly under that certain declaration entitled “Residential Protective
Covenants and Restrictions” (the “Declaration”) dated October 23, 1983 which Declaration is
recorded in Book 5715, Page 983, of the Real Estate Registry of Duval County, Florida. Such
indemnification shall survive any transfer of title to Lender or its successors and assigns,
whether by foreclosure or deed-in-lieu of foreclosure, provided that such indemnification shall
automatically terminate upon Lender’s release of the Green Tree Property from the Collateral Pool
and by recordation of the release of the lien of the Security Instrument securing the Green Tree
Property.



     Section 26. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 27. Full Force and Effect. Except as expressly modified by this Amendment,
all terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 28. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



     Section 29. Applicable Law. The provisions of Section 23.06 of the Master
Agreement (entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby
incorporated into this Amendment by this reference to the fullest extent as if the text of such
provisions were set forth in their entirety herein.



[Signatures follow on next page]




4









 




IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




	 	 	 	 	 	 	 
	 	 	BORROWER	 	 
	 
	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation
	 
	 	 	 	 	 	 
	 

	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	Title:
	 	Vice President	 	 






	 	 	 	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION
REALTY, L.P., a Delaware limited partnership, its
General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	 	 	Title:
	 	 Vice President	 	 






	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC, a Washington limited liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation,
its Administrative Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[Signatures Continue]






5









 





	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC, a Washington limited liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation, its Administrative Member
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 






	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 






	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a North Carolina limited partnership
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	 	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	[Signatures Continue]






6









 





	 	 	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, its Managing Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 






	 	 	 	 	 	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	ASR INVESTMENTS CORPORATION, a Maryland corporation, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	 	 	Title:
	 	 Vice President	 	 






	 	 	 	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[Signatures Continue]






7









 





	 	 	 	 	 	 	 	 	 
	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:

Name:
	 	/s/ Justin R. Sato
 

Justin R. Sato
	 	 
	 

	 	 	 	Title:
	 	Vice President	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	[Signatures Continue]






8









 





	 	 	 	 	 	 	 	 	 
	 	 	LENDER	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership	 	 
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty,
Inc., a California Corporation, its General Partner	 	 
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Timothy L. White
 
	 	 
	 

	 	 	 	Name:
	 	Timothy L. White
	 	 
	 

	 	 	 	Title:
	 	Executive Vice President
	 	 
	 

	 	 	 	 	 	 

	 	 







9










 








EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village
	 	200 Bicentennial Circle	 	$	44,800,000	 
	 
	 	Sacramento, CA  95826	 	 	 	 
	Aspen Court
	 	2305 Ashcroft	 	$	5,700,000	 
	 
	 	Arlington, TX  76006	 	 	 	 
	Braesridge
	 	11100 Braesridge	 	$	14,650,00	 
	 
	 	Houston, TX  77071	 	 	 	 
	Crown Pointe
	 	3788 NE 4th Street	 	$	11,900,000	 
	 
	 	Renton, WA  98056	 	 	 	 
	Derby Park
	 	606 W. Safari Parkway	 	$	15,900,000	 
	 
	 	Grand Prairie, TX  75050	 	 	 	 
	Hilltop
	 	500 Monroe Avenue NE	 	$	11,000,000	 
	 
	 	Renton, WA  98056	 	 	 	 
	Riverwood
	 	1045 Holcomb Bridge Road	 	$	16,750,000	 
	 
	 	Roswell, GA  30076	 	 	 	 
	Summit Ridge
	 	1604 Ridge Haven Drive	 	$	11,000,000	 
	 
	 	Arlington, TX  76011	 	 	 	 
	Beaumont
	 	8504 82nd Street, S.W.	 	$	15,200,000	 
	 
	 	Lakewood, WA  98498	 	 	 	 
	Chelsea Park
	 	11000 Crescent Moon	 	$	7,700,000	 
	 
	 	Houston, TX  77064	 	 	 	 
	Country Club Place
	 	1111 Golfview	 	$	7,000,000	 
	 
	 	Richmond, TX  77469	 	 	 	 
	Dunwoody Pointe
	 	7901 Roswell Road	 	$	14,100,000	 
	 
	 	Atlanta, GA  30350	 	 	 	 
	Trinity Park
	 	5301 Creek Ridge Lane	 	$	22,540,000	 
	 
	 	Raleigh, NC  27607	 	 	 	 
	Arbor Terrace I
	 	1800 Sidney Avenue	 	$	7,913,043	 
	 
	 	Port Orchard, WA  98366	 	 	 	 
	Arbor Terrace II
	 	1790 Sidney Avenue	 	$	6,086,957	 
	 
	 	Port Orchard, WA  98366	 	 	 	 
	Foothills Tennis Village
	 	5 Marcia Way	 	$	22,600,000	 
	 
	 	Roseville, CA  95747	 	 	 	 
	Jamestown of Toledo
	 	3215 Milstead Drive	 	$	7,300,000	 
	 
	 	Toledo, OH  43606	 	 	 	 
	Lancaster Commons
	 	2489 Coral Avenue NE	 	$	11,300,000	 
	 
	 	Salem, OR  97305	 	 	 	 
	Sugar Mill Creek
	 	8500 Belcher Road	 	$	10,600,000	 
	 
	 	Pinellas Park, FL  33781	 	 	 	 







A-1









 






	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Tualatin Heights
	 	9301 SW Sagert Road	 	$	14,575,000	 
	 
	 	Tualatin, OR  97062	 	 	 	 
	Alexander Court
	 	135 Reynoldsburg-New Albany Road	 	$	18,520,550	 
	 
	 	Reynoldsburg, OH  43068	 	 	 	 
	Meadows at Kildaire
	 	2600 Harvest Creek Place	 	$	20,109,220	 
	 
	 	Apex, NC  27539	 	 	 	 
	Carrington Hills
	 	4268 South Carothers Road	 	$	24,900,000	 
	 
	 	Franklin, TN 37067	 	 	 	 
	Colonnade
	 	4100 Central Pike	 	$	20,250,000	 
	 
	 	Nashville, TN	 	 	 	 
	Sierra Canyon
	 	17500 North 67th Avenue	 	$	17,402,983	 
	 
	 	Glendale, Arizona 85308	 	 	 	 
	Green Tree Place
	 	9480 Princeton Square Boulevard	 	$	25,927,733	 
	 
	 	Jacksonville, Florida 32256	 	 	 	 








A-2









 








REAFFIRMATION, JOINDER AND TWELFTH AMENDMENT TO 

MASTER CREDIT FACILITY AGREEMENT




     THIS REAFFIRMATION, JOINDER AND TWELFTH AMENDMENT TO MASTER CREDIT FACILITY AGREEMENT (this
“Amendment”) is effective as of the 29th day of September, 2006 by and among (i)
(a) UNITED DOMINION REALTY TRUST, INC., a Maryland corporation (“UDRT”), (b) WOODLAKE
VILLAGE, L.P., a California limited partnership (“Woodlake”) (individually and
collectively, UDRT and Woodlake, “Original Borrower”), (c) AAC/FSC CROWN POINTE INVESTORS,
LLC, a Washington limited liability company (“Crown Pointe”), (d) AAC/FSC HILLTOP
INVESTORS, LLC, a Washington limited liability company (“Hilltop”), (e) UNITED DOMINION
REALTY, L.P., a Delaware limited partnership (“UDR”), (f) UDR OF NC, LIMITED PARTNERSHIP, a
North Carolina limited partnership (“UDR NC”), (g) AAC FUNDING PARTNERSHIP II, a Delaware
general partnership (“AAC”), (h) HERITAGE COMMUNITIES L.P., a Delaware limited partnership
(“Heritage Communities”), (i) UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership
(“UDR Texas”), (j) UDR of TENNESSEE, L.P., a Virginia limited partnership (“UDR
Tennessee”), and (k) UDR CALIFORNIA PROPERTIES, LLC, a Virginia limited liability company
(“UDR California” or the “Additional Borrower”) (individually and collectively,
Original Borrower, Crown Pointe, Hilltop, UDR, UDR NC, AAC, Heritage Communities, UDR Texas, UDR
Tennessee and UDR California, “Borrower”) and (ii) ARCS COMMERCIAL MORTGAGE CO., L.P., a
California limited partnership (“Lender”).



RECITALS




     A. Pursuant to that certain Master Credit Facility Agreement dated as of December 12, 2001,
(as amended from time to time, the “Master Agreement”) Original Borrower and Lender agreed
to the terms and conditions under which Lender would establish a credit facility in the original
amount of $300,000,000 and make Base and Revolving Advances to Original Borrower.



     B. Pursuant to that certain First Reaffirmation and Joinder Agreement dated as of January 14,
2002, Heritage – Aspen Court L.P., an Arizona limited partnership (“Aspen”), South West
Properties, L.P., a Delaware limited partnership (“South West”), Crown Pointe, Heritage –
Gentry Place L.P., an Arizona limited partnership (“Gentry Place”), Hilltop, UDR, Heritage
– Smith Summit L.P., an Arizona limited partnership (“Smith Summit”), UDR Summit Ridge
L.P., a Delaware limited partnership (“Summit Ridge”) and UDR NC joined into the Master
Agreement as if each were an Original Borrower.



     C. Pursuant to that certain First Amendment to Master Credit Facility Agreement dated as of
January 14, 2002, Borrower added nine (9) Mortgaged Properties commonly known as Aspen Court owned
by Aspen, Braesridge owned by South West, Crown Pointe owned by Crown Pointe, Derby Park owned by
Gentry Place, Hilltop owned by Hilltop, Riverwood owned by UDR, The Summit owned by Smith Summit,
Summit Ridge owned by Summit Ridge, and Village at Cliffdale owned by UDR NC, to the Collateral
Pool.



     D. Pursuant to that certain Second Reaffirmation and Joinder Agreement dated as of January 24,
2002, UDR Beaumont, LLC, a Virginia limited liability company (“Beaumont”),



 









 







Heritage – Chelsea Park L.P., an Arizona limited partnership (“Chelsea Park”),
Heritage – Country Club Place L.P., an Arizona limited partnership (“Country Club”), and
Contempo Heights L.L.C., an Arizona limited liability company (“Contempo Heights”) joined
into the Master Agreement as if each were an Original Borrower.



     E. Pursuant to that certain Second Amendment to Master Credit Facility Agreement dated as of
January 24, 2002, Borrower added six (6) Mortgaged Properties commonly known as Beaumont owned by
Beaumont, Chelsea Park owned by Chelsea, Country Club Place owned by Country Club, Dunwoody Pointe
owned by UDRT, Stonegate owned by Contempo Heights, and Trinity Park owned by UDR NC, to the
Collateral Pool.



     F. Pursuant to that certain Third Reaffirmation and Joinder Agreement dated as of March 21,
2002, Heritage – Arbor Terrace I, L.L.C., an Arizona limited liability company (“Arbor I”),
Heritage – Arbor Terrace II, L.L.C., an Arizona limited liability company (“Arbor II”), AAC
and Jamestown of St. Matthews Limited Partnership, an Ohio limited partnership (“Jamestown of
St. Matthews LP”), joined into the Master Agreement as if each were an Original Borrower.



     G. Pursuant to that certain Third Amendment to Master Credit Facility Agreement dated as of
March 21, 2002, Borrower added fourteen (14) Mortgaged Properties commonly known American Heritage
owned by AAC, Arbor Terrace I owned by Arbor I, Arbor Terrace II owned by Arbor II, Brandywine
owned by AAC, Foothills owned by AAC, Jamestown of St. Matthews owned by Jamestown of St. Matthews
LP, Jamestown of Toledo owned by AAC, Kings Gate owned by AAC, Lakewood owned by AAC, Lancaster
Commons owned by AAC, Lancaster Lakes owned by AAC, Nemoke owned by AAC, Sugar Mill Creek owned by
AAC, and Tualatin Heights owned by UDR, to the Collateral Pool.



     H. Pursuant to that certain Fourth Amendment to Master Credit Facility Agreement dated as of
May 14, 2002, the Revolving Facility was reduced by, and the Base Facility Commitment was increased
by, $150,000,000.00.



     I. Borrower entered into that certain Fifth Amendment to Master Credit Facility Agreement
dated as of October 8, 2004 to reflect (i) the succession by merger of (a) Heritage Communities to
the rights and obligations under the Master Agreement of Arbor I, Arbor II, Aspen, Gentry Place,
Smith Summit, Chelsea Park, Country Club and Beaumont and (b) UDR Texas to the rights and
obligations of South West, Summit Ridge and Contempo Heights under the Master Agreement and (ii)
the addition of the Mortgaged Properties commonly known as (a) Alexander Court, owned by UDR, and
(b) Meadows at Kildaire, owned by UDR NC, to the Collateral Pool, (iii) the release of the
Mortgaged Properties known as (a) American Heritage, owned by AAC, (b) Jamestown of St. Matthews,
owned by Jamestown of St. Matthews LP, (c) Kings Gate, owned by AAC, and (d) Lakewood, owned by
AAC, from the Collateral Pool, and (iv) the release of Jamestown of St. Matthews LP from each of
the Loan Documents as a Borrower.



     J. Borrower entered into that certain Sixth Amendment to Master Credit Facility Agreement
dated as of December 1, 2004 to reflect the release of the Mortgaged Properties



2









 







known as Brandywine Creek, owned by AAC, and Stonegate, owned by UDR Texas, from the
Collateral Pool.



     K. Pursuant to that certain Fourth Reaffirmation and Joinder Agreement dated as of December 8,
2004, UDR Tennessee joined into the Master Agreement as if it were an Original Borrower.



     L. Borrower entered into that certain Seventh Amendment to Master Credit Facility Agreement
dated as of December 8, 2004 to reflect (i) the addition of the Mortgaged Properties commonly known
as Carrington Hills, owned by UDR, and Colonnade, owned by UDR Tennessee to the Collateral Pool,
and (ii) the release of the Mortgaged Properties known as Lancaster Lakes, owned by AAC, and Nemoke
Trail, owned by AAC, from the Collateral Pool, and (iii) the modification of other terms of the
Master Agreement as set forth therein.



     M. Borrower entered into that certain Eighth Amendment to Master Credit Facility
Agreement dated as of July 1, 2005 to reflect (i) the addition of the Mortgaged Property commonly
known as Sierra Canyon, owned by UDR, to the Collateral Pool, and (ii) the release of the Mortgaged
Property known as The Summit, owned by Heritage Communities, from the Collateral Pool.



     N. Borrower entered into that certain Ninth Amendment to Master Credit Facility Agreement
dated as of September 30, 2005 to reflect the modification of certain terms of the Master Agreement
as set forth therein.



     O. Borrower entered into that certain Tenth Amendment to Master Credit Facility Agreement
dated as of July 3, 2006 to reflect a conversion of a portion of the Revolving Facility Commitment
to the Base Facility Commitment.



     P. Borrower entered into that certain Twelfth Amendment to Master Credit Facility Agreement
dated as of August 29, 2006 to reflect (i) the addition of the Mortgaged Property commonly known as
Green Tree Place, owned by UDRT, to the Collateral Pool, and (ii) the release of the Mortgaged
Property known as The Village at Cliffdale, owned by UDR NC, from the Collateral Pool.



     Q. All of the Lender’s right, title and interest in the Master Agreement and the Loan
Documents executed in connection with the Master Agreement or the transactions contemplated by the
Master Agreement have been assigned to Fannie Mae pursuant to that certain Assignment of Collateral
Agreement and Other Loan Documents, dated as of December 12, 2001 (the “Assignment”).
Fannie Mae has not assumed any of the obligations of the Lender under the Master Agreement or the
Loan Documents as a result of the Assignment. Fannie Mae has designated the Lender as the servicer
of the Advances contemplated by the Master Agreement.



     R. The parties are executing this Amendment to the Master Agreement to reflect a substitution
under the Master Agreement as evidenced by (i) the release from the Collateral Pool of the
Mortgaged Property commonly known as Beaumont, located in Lakewood, Washington
(“Beaumont”), (ii) the addition to the Collateral Pool of the Mortgaged Property commonly
known as Rancho Vallecitos, located in San Diego County, California (“Rancho Vallecitos”),



3









 







and (iii) the joinder of Additional Borrower to the Master Agreement as if it were an original
Borrower.



     NOW, THEREFORE, the parties hereto, in consideration of the mutual promises and agreements
contained in this Amendment and the Master Agreement, and other good and valuable consideration,
the receipt and sufficiency of which is hereby acknowledged, hereby agree as follows:



     Section 30. Release of Mortgaged Property. Beaumont is hereby released from the
Collateral Pool under the Master Agreement.



     Section 31. Addition of Mortgaged Property. Rancho Vallecitos is hereby added to the
Collateral Pool under the Master Agreement.



     Section 32. Reaffirmation. Each Borrower hereby reaffirms its obligations pursuant to
the Master Agreement.



     Section 33. Joinder. Additional Borrower hereby joins in the Master Agreement as if it
were Original Borrower thereunder and hereby agrees that all references in the Loan Documents to
any Borrower shall include Additional Borrower including but not limited to the Master Agreement
and the Note.



     Section 34. Amendment to Exhibit A. Exhibit A to the Master Agreement is
hereby deleted in its entirety and replaced with the Exhibit A attached hereto.



     Section 35. Special Representations with Respect to Rancho Vallecitos. Borrower shall
indemnify, hold harmless and defend Lender and its successors or assigns from and against all
proceedings, claims, damages, fees, and costs, including reasonable attorneys fees and expenses,
arising directly or indirectly under that certain unrecorded agreement referenced in that certain
“Memorandum of Agreement for Easements, Licenses, and Maintenance of Facilities” (the
“Memorandum”) dated June 24, 1986, executed by and between San Marcos 46, LSI-82-1, Alanda,
and Alanda II and Successors, which Memorandum is recorded June 30, 1986 as Instrument No.
86-269853 of Official Records of San Diego County, California. Such indemnification shall survive
any transfer of title to Lender or its successors and assigns, whether by foreclosure or
deed-in-lieu of foreclosure, provided that such indemnification shall automatically terminate upon
Lender’s release of Rancho Vallecitos from the Collateral Pool and by recordation of the release of
the lien of the Security Instrument securing Rancho Vallecitos.



     Section 36. Capitalized Terms. All capitalized terms used in this Amendment which are
not specifically defined herein shall have the respective meanings set forth in the Master
Agreement.



     Section 37. Full Force and Effect. Except as expressly modified by this Amendment, all
terms and conditions of the Master Agreement shall continue in full force and effect.



     Section 38. Counterparts. This Amendment may be executed in counterparts by the
parties hereto, and each such counterpart shall be considered an original and all such counterparts
shall constitute one and the same instrument.



4









 





     Section 39. Applicable Law. The provisions of Section 23.06 of the Master
Agreement (entitled “Choice of Law; Consent to Jurisdiction; Waiver of Jury Trial”) are hereby
incorporated into this Amendment by this reference to the fullest extent as if the text of such
provisions were set forth in their entirety herein.



[Signatures follow on next page]




5









 







IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the day and year first
above written.




	 	 	 	 	 	 	 	 	 
	 	 	BORROWER
	 
	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	/s/ Michael A. Ernst
	 	 	 	 	 
	 	 	Name:	 	Michael A. Ernst
	 	 	Title:	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	WOODLAKE VILLAGE, L.P., a California limited partnership
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION
REALTY, L.P., a Delaware limited partnership, its
General Partner
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland
corporation, its General Partner
	 
	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	 	 	Title:
	 	Executive Vice President, Treasurer &

Chief Financial Officer
	 
	 	 	 	 	 	 	 	 
	 	 	AAC/FSC CROWN POINTE INVESTORS, LLC,
 a Washington
 limited
liability company
	 
	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware corporation,
its Administrative Member
	 
	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Michael A. Ernst
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Michael A. Ernst
	 	 	 	 	Title:	 	Executive Vice President, Treasurer & Chief

Financial Officer
	 
	 	 	 	 	 	 	 	 
	
[Signatures Continue]






6









 






	 	 	 	 	 	 	 	 	 	 	 
	 	 	AAC/FSC HILLTOP INVESTORS, LLC,

a Washington limited liability company
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	AAC SEATTLE I, INC., a Delaware
corporation, its Administrative Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Michael A. Ernst
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Michael A. Ernst
	 	 	 	 	Title:	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UNITED DOMINION REALTY, L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC.,
a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	/s/ Michael A. Ernst
	 	 	 	 	 	 	 
	 	 	 	 	Name:	 	Michael A. Ernst
	 	 	 	 	Title:	 	Executive Vice President, Treasurer & Chief

Financial Officer
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	UDR OF NC, LIMITED PARTNERSHIP, a 
North Carolina limited partnership
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	By:	 	UDRT OF DELAWARE 4 LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	By:	 	UNITED DOMINION REALTY, L.P., a Delaware limited
partnership, its Sole Member
	 
	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a

Maryland corporation, its General Partner
	 
	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	 	 	 	 	Title:
	 	Executive Vice President,

Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 	 	 	 	 
	
[Signatures Continue]






7









 






	 	 	 	 	 	 	 
	 	 	AAC FUNDING PARTNERSHIP II, a Delaware general partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	AAC FUNDING II, INC., a Delaware corporation, its Managing Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	Title:
	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 
	 	 	HERITAGE COMMUNITIES L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	ASR OF DELAWARE LLC, a Delaware limited liability company, its General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	ASR INVESTMENTS CORPORATION, a Maryland corporation, its Sole Member
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	Title:
	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 
	 	 	UDR TEXAS PROPERTIES, L.P., a Delaware limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	UDR WESTERN RESIDENTIAL, INC., a Virginia corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	Title:
	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 
	
[Signatures Continue]






8









 






	 	 	 	 	 	 	 
	 	 	UDR OF TENNESSEE, L.P., a Virginia limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	Title:
	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 
	 	 	UDR CALIFORNIA PROPERTIES, LLC, a Virginia limited liability company
	 
	 	 	 	 	 	 
	 	 	By:	 	UNITED DOMINION REALTY TRUST, INC., a Maryland corporation, Manager
	 
	 	 	 	 	 	 
	 

	 	 	 	By:
	 	/s/ Michael A. Ernst
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:
	 	Michael A. Ernst
	 

	 	 	 	Title:
	 	Executive Vice President, Treasurer & Chief Financial Officer
	 
	 	 	 	 	 	 
	
[Signatures Continue]






9









 






	 	 	 	 	 	 	 
	 	 	LENDER
	 
	 	 	 	 	 	 
	 	 	ARCS COMMERCIAL MORTGAGE CO., L.P., a California limited partnership
	 
	 	 	 	 	 	 
	 	 	By:	 	ACMC Realty, Inc., a California Corporation, its General Partner
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	/s/ Timothy L. White
	 

	 	 	 	 	 	 
	 

	 	 	 	Name:	 	Timothy L. White
	 

	 	 	 	 	 	 
	 

	 	 	 	Title:	 	Executive Vice President
	 

	 	 	 	 	 	 






10









 








EXHIBIT A




SCHEDULE OF INITIAL MORTGAGED PROPERTIES

AND INITIAL VALUATIONS




	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Woodlake Village
	 	200 Bicentennial Circle	 	$	44,800,000	 
	 
	 	Sacramento, CA  95826	 	 	 	 
	Aspen Court
	 	2305 Ashcroft	 	$	5,700,000	 
	 
	 	Arlington, TX  76006	 	 	 	 
	Braesridge
	 	11100 Braesridge	 	$	14,650,00	 
	 
	 	Houston, TX  77071	 	 	 	 
	Crown Pointe
	 	3788 NE 4th Street	 	$	11,900,000	 
	 
	 	Renton, WA  98056	 	 	 	 
	Derby Park
	 	606 W. Safari Parkway	 	$	15,900,000	 
	 
	 	Grand Prairie, TX  75050	 	 	 	 
	Hilltop
	 	500 Monroe Avenue NE	 	$	11,000,000	 
	 
	 	Renton, WA  98056	 	 	 	 
	Riverwood
	 	1045 Holcomb Bridge Road	 	$	16,750,000	 
	 
	 	Roswell, GA  30076	 	 	 	 
	Summit Ridge
	 	1604 Ridge Haven Drive	 	$	11,000,000	 
	 
	 	Arlington, TX  76011	 	 	 	 
	Chelsea Park
	 	11000 Crescent Moon	 	$	7,700,000	 
	 
	 	Houston, TX  77064	 	 	 	 
	Country Club Place
	 	1111 Golfview	 	$	7,000,000	 
	 
	 	Richmond, TX  77469	 	 	 	 
	Dunwoody Pointe
	 	7901 Roswell Road	 	$	14,100,000	 
	 
	 	Atlanta, GA  30350	 	 	 	 
	Trinity Park
	 	5301 Creek Ridge Lane	 	$	22,540,000	 
	 
	 	Raleigh, NC  27607	 	 	 	 
	Arbor Terrace I
	 	1800 Sidney Avenue	 	$	7,913,043	 
	 
	 	Port Orchard, WA  98366	 	 	 	 
	Arbor Terrace II
	 	1790 Sidney Avenue	 	$	6,086,957	 
	 
	 	Port Orchard, WA  98366	 	 	 	 
	Foothills Tennis Village
	 	5 Marcia Way	 	$	22,600,000	 
	 
	 	Roseville, CA  95747	 	 	 	 
	Jamestown of Toledo
	 	3215 Milstead Drive	 	$	7,300,000	 
	 
	 	Toledo, OH  43606	 	 	 	 
	Lancaster Commons
	 	2489 Coral Avenue NE	 	$	11,300,000	 
	 
	 	Salem, OR  97305	 	 	 	 
	Sugar Mill Creek
	 	8500 Belcher Road	 	$	10,600,000	 
	 
	 	Pinellas Park, FL  33781	 	 	 	 
	Tualatin Heights
	 	9301 SW Sagert Road	 	$	14,575,000	 
	 
	 	Tualatin, OR  97062	 	 	 	 







A-1









 






	 	 	 	 	 	 	 
	Property Name	 	Property Address	 	Initial Valuation
	Alexander Court
	 	135 Reynoldsburg-New Albany Road	 	$	18,520,550	 
	 
	 	Reynoldsburg, OH  43068	 	 	 	 
	Meadows at Kildaire
	 	2600 Harvest Creek Place	 	$	20,109,220	 
	 
	 	Apex, NC  27539	 	 	 	 
	Carrington Hills
	 	4268 South Carothers Road	 	$	24,900,000	 
	 
	 	Franklin, TN 37067	 	 	 	 
	Colonnade
	 	4100 Central Pike	 	$	20,250,000	 
	 
	 	Nashville, TN	 	 	 	 
	Sierra Canyon
	 	17500 North 67th Avenue	 	$	17,402,983	 
	 
	 	Glendale, Arizona 85308	 	 	 	 
	Green Tree Place
	 	9480 Princeton Square Boulevard	 	$	25,927,733	 
	 
	 	Jacksonville, Florida 32256	 	 	 	 
	Rancho Vallecitos
	 	823 N. Nordahl Road	 	$	26,332,932	 
	 
	 	San Marcos, California 92069	 	 	 	 








A-2