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Exhibit 10.28    
    

 
 

THERAVANCE, INC.
  
  CLASS A COMMON
  
  STOCK PURCHASE AGREEMENT
  
  September    , 2004    
    

 
 

TABLE OF CONTENTS    
    

	 
	 	Page

	1. Purchase and Sale of Stock	 	3
	 	1.1 Sale and Issuance of Class A Common Stock	 	3
	 	1.2 Closing	 	3
	 	1.3 Additional Closing	 	4
	

2. Representations and Warranties of the Company	
 	

4
	 	2.1 Organization, Good Standing and Qualification	 	4
	 	2.2 Capitalization and Voting Rights	 	4
	 	2.3 Subsidiaries	 	4
	 	2.4 Authorization	 	4
	 	2.5 Valid issuance of Preferred and Common Stock	 	4
	 	2.6 Governmental Consents	 	5
	 	2.7 Offering	 	5
	 	2.8 Litigation	 	5
	 	2.9 Patents and Trademarks	 	5
	 	2.10 Compliance with Other Instruments	 	6
	 	2.11 Agreements; Action	 	6
	 	2.12 Related-Party Transactions	 	6
	 	2.13 Permits	 	6
	 	2.14 Disclosure	 	6
	 	2.15 Corporate Documents	 	6
	 	2.16 Title to Property and Assets	 	6
	 	2.17 Tax Returns, Payments and Elections	 	7
	 	2.18 Environmental Law	 	7
	 	2.19 Proprietary Information and Employment Agreements	 	7
	 	2.20 Financial Statements	 	7
	 	2.21 Registration Rights	 	7
	 	2.22 Real Property Holding Corporation	 	7
	 	2.23 Labor Agreements	 	7
	 	2.24 Insurance	 	8
	

3. Representations and Warranties of the Investor	
 	

8
	 	3.1 Authorization	 	8
	 	3.2 Purchase Entirely for Own Account	 	8
	 	3.3 Disclosure of Information	 	8
	 	3.4 Investment Experience	 	8
	 	3.5 Accredited Investor	 	8
	 	3.6 Restricted Securities	 	8
	

4. Conditions of Investor's Obligations at Closing	
 	

8
	 	4.1 Performance	 	9
	 	4.2 Compliance Certificate	 	9
	 	4.3 Qualifications	 	9
	 	4.4 Proceedings and Documents	 	9
	 	4.5 Closing of Initial Public Offering	 	9
	

5. Conditions of the Company's Obligations at Closing	
 	

9
	 	5.1 Representations and Warranties	 	9
	 	5.2 Qualifications	 	9
	 	5.3 Closing of Initial Public Offering	 	9
	

6. Miscellaneous	
 	

9
	 	6.1 Survival of Warranties	 	9
	 	 	 

 

	 	6.2 Successors and Assigns	 	9
	 	6.3 Governing Law	 	9
	 	6.4 Counterparts	 	10
	 	6.5 Titles and Subtitles	 	10
	 	6.6 Notices	 	10
	 	6.7 Finder's Fee	 	10
	 	6.8 Expenses	 	10
	 	6.9 Amendments and Waivers	 	10
	 	6.10 Severability	 	10
	 	6.11 Confidentiality	 	11
	 	6.12 Publicity	 	11
	 	6.13 Entire Agreement	 	11
	 	6.14 Legends	 	11
	 	6.15 Acknowledgement of Notice and Partial Exercise of Rights	 	11
	 	6.16 Registrable Securities	 	12

2

  

 
 

THERAVANCE, INC.
  
    CLASS A COMMON STOCK PURCHASE AGREEMENT    
    

        THIS STOCK PURCHASE AGREEMENT (the "Agreement") is made as of the    day of September, 2004, by and among Theravance, Inc., a Delaware
corporation (the "Company"), and SmithKline Beecham Corporation, a Pennsylvania corporation (the "Investor"). 

        WHEREAS,
pursuant to Section 2.1(d)(i) of that certain Amended and Restated Governance Agreement, dated June 4, 2004 by and among the Company and the Investor and
its affiliates (the "Governance Agreement"), the Investor has certain rights to purchase equity securities of the Company in connection with issuances of equity securities by the Company; 

        WHEREAS,
the Company intends to effect an initial public offering of its Common Stock (the "Initial Public Offering") pursuant to its registration statement on
Form S-1 filed with the Securities and Exchange Commission (the "SEC") on June 10, 2004, as amended (the "Registration Statement") and pursuant to a purchase agreement by and
among the Company and the various underwriters named in the Company's final prospectus for the Initial Public Offering (the "Underwriters"); 

        WHEREAS,
pursuant to the Initial Public Offering, the Underwriters have agreed to purchase                        shares of the Company's
Common Stock and the Company has granted the
Underwriters an option to purchase (the "Over-allotment Option") an additional                        shares of the Company's
Common Stock (the "Over-allotment Shares"); and 

        WHEREAS,
in connection with the Initial Public Offering, the Investor desires to partially exercise its rights under Section 2.1(d)(i) of the Governance Agreement to
purchase shares of the Company's Class A Common Stock. 

        THE
PARTIES HEREBY AGREE AS FOLLOWS: 

        1.    Purchase and Sale of Stock.    

        1.1    Sale and Issuance of Class A Common Stock.    

        (a)   On
or prior to the Closing (as defined below), the Company shall adopt and file with the Secretary of State Delaware the Restated Certificate of Incorporation (the
"Restated Certificate") in the form attached as Exhibit 3.3 to the Registration Statement. 

        (b)   On
or prior to the Closing (as defined below), the Company shall have authorized the sale and issuance pursuant to this Agreement of at
least                        shares of
its Class A Common Stock at a price equal to the public offering price per share of shares of Common Stock initially sold to the public pursuant to the Registration Statement. The
Class A Common Stock shall have the rights, preferences, privileges and restrictions set forth in the Restated Certificate. 

        (c)   Subject
to the terms and conditions of this Agreement, the Investor agrees to purchase at the Closing and the Company agrees to sell and issue to the Investor at the
Closing,                        shares of the Company's Class A Common Stock for an aggregate purchase price of
$                        .
 

        1.2    Closing.    The purchase and sale of the Class A Common Stock shall take place at the offices of
Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, 155 Constitution Drive, Menlo Park, CA 94025, immediately after the closing of the Initial Public Offering (the "IPO Closing"),
which is expected to occur at 6:00 A.M. on October    , 2004, or at such other time and place as the Company and Investor mutually agree upon orally or in writing (which time and
place are designated as the "Closing"). At the Closing the Company shall deliver to the Investor a certificate representing the Class A Common Stock that the Investor is purchasing against
payment of the purchase price therefor by check or wire transfer, or any combination thereof. 

3

 

        1.3    Additional Closing.    If the Underwriters exercise the Over-allotment Option, Investor agrees that
it shall purchase an additional number of shares of the Company's Class A Common Stock equal to 6.133% of the number of Over-allotment Shares with respect to which the Underwriters
exercise their option to purchase rounded up to the nearest full share (the "Additional Shares") for an aggregate purchase price equal to the product of the number of Additional Shares multiplied by
the public offering price per share of shares of Common Stock initially sold to the public pursuant to the Registration Statement. The purchase and sale of the Additional Shares shall take place at
the offices of Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP, 155 Constitution Drive, Menlo Park, CA 94025, immediately after the closing of the Underwriters' purchase of the
Over-allotment Shares, or at such other time and place as the Company and
Investor mutually agree upon orally or in writing (which time and place are designated as the "Additional Closing"). At the Additional Closing the Company shall deliver to the Investor a certificate
representing the Class A Common Stock that the Investor is purchasing against payment of the purchase price therefor by check or wire transfer, or any combination thereof. 

        2.    Representations and Warranties of the Company.    The Company hereby represents and warrants to the Investor
that, as of the date hereof, and except as set forth in the Company's prospectus dated [September]    , 2004 which is part of the Registration Statement and which
has been furnished to the Investor (the "Prospectus"), which exceptions shall be deemed to be representations and warranties as if made hereunder: 

        2.1    Organization, Good Standing and Qualification.    The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware and has all requisite corporate power and authority to (i) execute, deliver and perform its obligations under this Agreement,
(ii) to issue and sell the Class A Common Stock hereunder, (iii) to perform its obligations under the Restated Certificate, and (iv) to carry on its business as now
conducted and as proposed to be conducted. The Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure to so qualify would have a material
adverse effect on its business or properties. 

        2.2    Capitalization and Voting Rights.    

        (a)   As
of June 30, 2004, the authorized capital of the Company is as set forth in the Prospectus under the caption "Capitalization." 

        2.3    Subsidiaries.    The Company does not presently own or control, directly or indirectly, any interest in any
other corporation, association or other business entity, other than Theravance East, Inc., a Delaware corporation and a direct wholly-owned subsidiary of the Company. The Company is not a
participant in any joint venture, partnership, or similar arrangement. 

        2.4    Authorization.    All corporate action on the part of the Company, its officers, directors and stockholders
necessary for the authorization, execution and delivery of this Agreement, the performance of all obligations of the Company hereunder, and the authorization, issuance (or reservation for issuance),
sale and delivery of the Class A Common Stock being sold hereunder has been taken or will be taken prior to the Closing, and this Agreement constitutes a valid and legally binding obligation of
the Company, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other equitable remedies. 

        2.5    Valid Issuance of Preferred and Common Stock.    The Class A Common Stock that is being purchased by the
Investor hereunder, when issued, sold and delivered in accordance with the terms of this Agreement for the consideration expressed herein, will be duly and validly issued, fully paid, and
nonassessable, and will be free of restrictions on transfer other than restrictions on transfer under this 

4

 

Agreement,
the Amended and Restated Investors' Rights Agreement dated May 11, 2004 by and among the Company and the investors who are parties thereto (the "Investors' Rights Agreement"), the
Governance Agreement and under applicable state and federal securities laws. The Class A Common Stock that is being purchased by the Investor hereunder will not be subject to preemptive rights
or rights of first refusal that have not been waived or complied with. 

        2.6    Governmental Consents.    No consent, approval, order or authorization of, or registration, qualification,
designation, declaration or filing with, any federal, state or local governmental authority on the part of the Company is required in connection with the consummation of the transactions contemplated
by this Agreement, except (i) the filing of the Restated Certificate with the Secretary of State of Delaware and (ii) certain post-closing filings as may be required pursuant
to federal securities laws and under the "Blue Sky" laws of the various states. 

        2.7    Offering.    Subject in part to the truth and accuracy of the Investor's representations set forth in
Section 3 of this Agreement, the offer, sale and issuance of the Class A Common Stock as contemplated by this Agreement are exempt from the registration requirements of any applicable
state and federal securities laws, and neither the Company nor any authorized agent acting on its behalf will take any action hereafter that would cause the loss of such exemption. 

        2.8    Litigation.    There is no action, suit, proceeding or investigation pending or, to the Company's knowledge,
currently threatened against the Company that questions the validity of this Agreement, or the right of the Company to enter into this Agreement, or to consummate the transactions contemplated hereby,
or if determined adversely, might result, either individually or in the aggregate, in (i) any material adverse changes in the assets, business or prospects of the Company, financially or
otherwise or (ii) any change in the current equity ownership of the Company, nor is the Company aware that there is any basis for the foregoing. The Company is not a party or subject to the
provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company currently
pending or that the Company intends to initiate. 

        2.9    Patents and Trademarks.    The Company owns, or has rights to use pursuant to a valid license, all patents,
trademarks, service marks, trade names, copyrights, trade secrets, information, proprietary rights and processes necessary for its business as now conducted. The use, modification, licensing,
sublicensing, sale, or any other exercise of rights involving such intellectual property does not infringe any copyright, trade secret, trademark, service mark, trade name, firm name, logo, trade
dress, mask work, moral right, other intellectual property right, right of privacy or right in personal data, or to the knowledge of the Company, any patent, of any person. No claims
(i) challenging the validity, effectiveness, or ownership by the Company of any of the Company's intellectual property, or (ii) to the effect that the use, reproduction, modification,
manufacturing, distribution, licensing, sublicensing, sale or any other exercise of rights in any product, work, technology, service or process as used, provided or offered at any time, or as proposed
for use, reproduction, modification, distribution, licensing, sublicensing, sale or any other exercise of rights, by the Company infringes or will infringe on any intellectual property or other
proprietary or personal right of any person have been asserted or, to the knowledge of the Company, (A) are threatened by any person nor (B) are there any valid grounds for any bona fide
claim of any such kind. To the knowledge of the Company, there is no unauthorized use, infringement or misappropriation of any of the Company's intellectual property by any third party, employee or
former employee. The Company's employees are not obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or
order of any court or administrative agency, that would interfere with the use of his or her best efforts to promote the interests of the Company or that would conflict with the Company's business as
proposed to be conducted. Neither the execution nor delivery of this Agreement, nor the carrying on of the Company's business by the employees of the Company, nor the conduct of the Company's business
as proposed, will, to the best of the Company's knowledge, conflict 

5

 

with
or result in a breach of the terms, conditions or provisions of, or constitute a default under, any contract, covenant or instrument under which any of such employees is now obligated. The
Company does not believe it is or will be necessary to utilize any inventions of any of its employees made prior to their employment by the Company unless such inventions are properly assigned to the
Company. 

        2.10    Compliance with Other Instruments.    The Company is not in violation or default in any material respect of
any provision of its Restated Certificate or Bylaws, or in any material respect of any instrument, judgment, order, writ, decree or contract to which it is a party or by which it is bound, or, to the
best of its knowledge, of any provision of any statute, rule or regulation applicable to the Company. The execution, delivery and performance of this Agreement, and the consummation of the
transactions contemplated hereby and thereby will not result in any such violation or be in conflict with or constitute, with or without the passage of time and giving of notice, either a default
under any such provision, instrument, judgment, order, writ, decree or contract or an event that results in the creation of any lien, charge or encumbrance upon any assets of the Company or the
suspension, revocation, impairment, forfeiture, or nonrenewal of any material permit, license, authorization, or approval applicable to the Company, its business or operations or any of its assets or
properties. 

        2.11    Agreements; Action.    

        The
Company's material agreements that are required by the rules and regulations of the SEC to be disclosed as exhibits to the Registration Statement are set forth as exhibits to the
Registration Statement. 

        2.12    Related-Party Transactions.    No executive officer or director of the Company or member of his or her
immediate family is indebted to the Company, nor is the Company indebted (or committed to make loans or extend or guarantee credit) to any of them. To the Company's knowledge, none of such persons has
any direct or indirect ownership interest in any firm or corporation with which the Company is affiliated or with which the Company has a business relationship, or any firm or corporation that
competes with the Company, except that executive officers or directors of the Company and members of their immediate families may own stock in publicly traded companies that may compete with the
Company. No member of the immediate family of any executive officer or director of the Company is directly or indirectly interested in any material contract with the Company. 

        2.13    Permits.    The Company has all material franchises, permits, licenses, and any similar authority necessary
for the conduct of its business as now being conducted by it, and the Company believes it can obtain, without undue burden or expense, any similar authority for the conduct of its business as planned
to be conducted. The Company is not in default in any material respect under any of its franchises, permits, licenses, or other similar authority. 

        2.14    Disclosure.    The Company has provided the Investor with all information requested by the Investor in
connection with their decision to purchase the Class A Common Stock, including all information the Company believes is reasonably necessary to make such investment decision. To the Company's
knowledge, neither this Agreement, nor any other statements or certificates made or delivered in connection herewith or therewith contains any untrue statement of a material fact or omits to state a
material fact necessary to make the statements herein or therein not misleading. 

        2.15    Corporate Documents.    The Restated Certificate and Bylaws of the Company are in the form as set forth as
exhibits 3.3 and 3.5, respectively, to the Registration Statement. 

        2.16    Title to Property and Assets.    The Company owns its property and assets free and clear of all mortgages,
liens, loans and encumbrances, except such encumbrances and liens that arise in the ordinary course of business and do not materially impair the Company's ownership or use of such property or assets,
and has good and marketable title to such property. With respect to the property and assets it leases, the Company is in compliance with such leases and holds a valid leasehold interest free of any
liens, claims or encumbrances. 

6

 

        2.17    Tax Returns, Payments and Elections.    The Company has timely filed all tax returns and reports as required
by law. These returns and reports are true and correct in all material respects. The Company has paid all taxes and assessments due, except those contested by it in good faith, if any. The Company has
not been advised (a) that any of its federal, state or local returns are being audited as of the date hereof, or (b) of any deficiency in assessment or proposed judgment to its federal,
state or other taxes. The Company has no knowledge of any tax liabilities due with respect to the Company or its properties or assets as of the date of this Agreement that are not adequately provided
for. 

        2.18    Environmental Law.    To the Company's knowledge, the Company is not in violation of and has no liability or
potential liability under any applicable statute, law, or regulation relating to the environment, and to the best of its knowledge, no material expenditures are or will be required in order to comply
with any such existing statute, law, or regulation. 

        2.19    Proprietary Information and Employment Agreements.    Each current and former employee, officer and consultant
of the Company has executed a standard Proprietary Information and Inventions Agreement. The Company is not aware that any of its employees, officers or consultants are in violation thereof, and the
Company will use its best efforts to prevent any such violation. The Company has not entered into any employment agreements with any executive officers of the Company. 

        2.20    Financial Statements.    The Company's audited financial statements as of December 31, 2002 and
December 31, 2003 and its unaudited financials as of and for the six-month period ended June 30, 2004 (the "Financial Statements") are as set forth in the Prospectus. The
Financial Statements have been prepared in accordance with generally accepted accounting principles applied on a consistent basis throughout the periods indicated and with each other except that the
unaudited Financial Statements may not contain all footnotes required by generally accepted accounting principles. The Financial Statements fairly present the financial condition and operating results
of the Company as of the dates, and for the periods, indicated therein, subject in the case of the unaudited Financial Statements to normal year-end audit adjustments. Except as set forth
in the Financial Statements, the Company has no material liabilities, contingent or otherwise, other than (i) liabilities incurred in the ordinary course of business subsequent to the date of
the Financial Statements and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under generally accepted accounting principles to be
reflected in the Financial Statements, which, in both cases, individually or in the aggregate, are not material to the financial condition or operating results of the Company. Except as disclosed in
the Financial Statements, the Company is not a guarantor or indemnitor of any indebtedness of any other person, firm or corporation. The Company maintains and will continue to maintain a standard
system of accounting established and administered in accordance with generally accepted accounting principles. 

        2.21    Registration Rights.    Except as required pursuant to the Investors' Rights Agreement, the Company is not
presently under any obligation, and has not granted, any rights to register any of the Company's presently outstanding securities or any of its securities that may hereafter be issued. 

        2.22    Real Property Holding Corporation.    The Company is not a real property holding corporation within the
meaning of Section 897(c)(2) of the Internal Revenue Code of 1986 (the "Code"), as amended, and any regulations promulgated thereunder. 

        2.23    Labor Agreements.    The Company is not bound by or subject to (and none of its assets or properties is bound
by or subject to) any written or oral, express or implied, contract, commitment or arrangement with any labor union, and no labor union has requested or, to the Company's knowledge, has sought to
represent any of the employees, representatives or agents of the Company. There is no strike or other labor dispute involving the Company pending, or to the Company's knowledge, threatened, that could
have a material adverse effect on its business or properties, nor is the Company aware of any labor organization activity involving its employees. 

7

 

        2.24    Insurance.    The Company maintains in full force and effect such types and amounts of insurance issued by
insurers of recognized responsibility insuring the Company with respect to its business and properties, in such amounts and against such losses and risks which are usual and customary in the Company's
business as to amount and scope. 

        3.    Representations and Warranties of the Investor.    The Investor hereby represents and warrants that: 

        3.1    Authorization.    The Investor has full power and authority to enter into this Agreement, and this Agreement
constitutes its valid and legally binding obligation, enforceable in accordance with its terms except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other
laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance, injunctive relief, or other
equitable remedies. 

        3.2    Purchase Entirely for Own Account.    This Agreement is made with the Investor in reliance upon the Investor's
representation to the Company, which by the Investor's execution of this Agreement the Investor hereby confirms, that the Class A Common Stock to be received by the Investor (the "Securities")
will be acquired for investment for the Investor's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Investor has no present
intention of selling, granting any participation in, or otherwise distributing the same in violation of applicable securities laws. By executing this Agreement, the Investor further represents that
the Investor does not have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such person or to any third person, with respect to any of
the Securities. 

        3.3    Disclosure of Information.    The Investor further represents that it has had an opportunity to ask questions
and receive answers from the Company regarding the terms and conditions of the offering of the Class A Common Stock and the business, properties, prospects and financial condition of the
Company. The foregoing, however, does not limit or modify the representations and warranties of the Company in Section 2 of this Agreement or the right of the Investor to rely thereon. 

        3.4    Investment Experience.    The Investor is an investor in securities of companies in the development stage and
acknowledges that it is able to fend for itself, can bear the economic risk of its investment, and has such knowledge and experience in financial or business matters that it is capable of evaluating
the merits and risks of the investment in the Class A Common Stock. The Investor also represents that it has not been organized for the purpose of acquiring the Class A Common Stock. 

        3.5    Accredited Investor.    The Investor is an "accredited investor" within the meaning of Rule 501 of
Regulation D adopted pursuant to the Act, as presently in effect. 

        3.6    Restricted Securities.    The Investor understands that the Securities it is purchasing are characterized as
"restricted securities" under the federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable
regulations such securities may be resold without registration under the Act, only in certain limited circumstances. In this connection, the Investor represents that it is familiar with
Rule 144 adopted pursuant to the Act, as presently in effect, and understands the resale limitations imposed thereby and by the Act. 

        4.    Conditions of Investor's Obligations at Closing.    The obligations of the Investor under subsection 1.1(c) of
this Agreement are subject to the fulfillment on or before the Closing of each of 

8

 

the
following conditions, the waiver of which shall not be effective against the Investor if it does not consent thereto: 

        4.1    Performance.    The Company shall have performed and complied with all agreements, obligations and conditions
contained in this Agreement that are required to be performed or complied with by it on or before the Closing. 

        4.2    Compliance Certificate.    The Chief Executive Officer of the Company shall deliver to the Investor at the
Closing a certificate stating that the conditions specified in Sections 4.1 have been fulfilled. 

        4.3    Qualifications.    All authorizations, approvals, or permits, if any, of any governmental authority or
regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be duly obtained and effective
as of the Closing. 

        4.4    Proceedings and Documents.    All corporate and other proceedings in connection with the transactions
contemplated at the Closing and all documents incident thereto shall be reasonably satisfactory in form and substance to the Investor, and they shall have received all such counterpart original and
certified or other copies of such documents as they may reasonably request. 

        4.5    Closing of Initial Public Offering.    The IPO Closing shall have occurred. 

        5.    Conditions of the Company's Obligations at Closing.    The obligations of the Company to the Investor under this
Agreement are subject to the fulfillment on or before the Closing of each of the following conditions by the Investor: 

        5.1    Representations and Warranties.    The representations and warranties of the Investor contained in
Section 3 shall have been true on and as of the Closing. 

        5.2    Qualifications.    All authorizations, approvals, or permits, if any, of any governmental authority or
regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Securities pursuant to this Agreement shall be duly obtained and effective
as of the Closing. 

        5.3    Closing of Initial Public Offering.    The IPO Closing shall have occurred. 

        6.    Miscellaneous.    

        6.1    Survival of Warranties.    The warranties, representations and covenants of the Company and the Investor
contained in or made pursuant to this Agreement shall survive the execution and delivery of this Agreement and the Closing and shall in no way be affected by any investigation of the subject matter
thereof made by or on behalf of the Investor or the Company. 

        6.2    Successors and Assigns.    Except as otherwise provided herein, the terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and assigns of the parties (including transferees of any Securities). Nothing in this Agreement, express or implied, is
intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement. 

        6.3    Governing Law.    This Agreement shall be governed by and construed in accordance with and governed by the law
of the State of Delaware, without regard to the conflicts of laws principles thereof. Any action brought, arising out of, or relating to this Agreement shall be brought in the Court of Chancery of the
State of Delaware. Each party hereby irrevocably submits to the exclusive jurisdiction of said Court in respect of any claim relating to the validity, interpretation and enforcement of this Agreement,
and hereby waives, and agrees not to assert, as a defense in any action, suit or proceeding 

9

 

in
which any such claim is made that it is not subject thereto or that such action, suit or proceeding may not be brought or is not maintainable in such courts, or that the venue thereof may not be
appropriate or that this agreement may not be enforced in or by such courts. The parties hereby consent to and grant the Court of Chancery of the State of Delaware jurisdiction over such parties and
over the subject matter of any such claim and agree that mailing of process or other papers in connection with any such action, suit or proceeding in the manner provided in Section 6.6, or in
such other manner as may be permitted by law, shall be valid and sufficient thereof. 

        6.4    Counterparts.    This Agreement may be executed in two or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same instrument. 

        6.5    Titles and Subtitles.    The titles and subtitles used in this Agreement are used for convenience only and are
not to be considered in construing or interpreting this Agreement. 

        6.6    Notices.    All notices required or permitted hereunder shall be in writing and shall be deemed effectively
given: (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient, if not, then
on the next business day or (c) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt.
Notwithstanding the foregoing or any provision to the contrary in the Investors' Rights Agreement or the Restated Certificate, the Company agrees that when any notice is given to the Investor, whether
under this Agreement, the Investors' Rights Agreement or the Restated Certificate, such notice shall not be deemed to be effectively given until a copy of such notice is transmitted to the Investor
via facsimile. All notices and certificates will be addressed to the Investor at the address set forth on the signature page hereto or at such other address as the Company or the Investor may
designate by ten (10) days advance written notice to the other parties hereto. 

        6.7    Finder's Fee.    The Investor agrees to indemnify and to hold harmless the Company from any liability for any
commission or compensation in the nature of a finders' fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Investor or any of its officers, partners, employees, or representatives is responsible. 

        The
Company agrees to indemnify and hold harmless the Investor from any liability for any commission or compensation in the nature of a finders' fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Company or any of its officers, employees or representatives is responsible. 

        6.8    Expenses.    Irrespective of whether the Closing is effected, each party shall bear their own costs and
expenses incurred with respect to the negotiation, execution, delivery and performance of this Agreement. If any action at law or in equity is necessary to enforce or interpret the terms of this
Agreement or the Restated Certificate, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements in addition to any other relief to which such party may
be entitled. 

        6.9    Amendments and Waivers.    Any term of this Agreement may be amended and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Investor. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each holder of any securities purchased under this Agreement at the time outstanding, each future holder of all such securities, and
the Company. 

        6.10    Severability.    If one or more provisions of this Agreement are held to be unenforceable under applicable
law, such provision shall be excluded from this Agreement and the balance of the Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its
terms. 

10

 

        6.11    Confidentiality.    Any confidential information obtained by the Investor pursuant to this Agreement which is
labeled or otherwise identified as confidential or proprietary shall be treated as confidential and shall not be disclosed to a third party without the prior written consent of the Company and shall
not be used by the Investor for any purpose other than monitoring the Investor's investment in the Company, except that the Investor may disclose such information (i) to its attorneys,
accountants, consultants, and other professionals to the extent necessary to obtain their services in connection with monitoring its investment in the Company, (ii) to its affiliates, officers,
directors, shareholders, members and/or partners in the ordinary course of business or pursuant to disclosure obligation to affiliates, shareholders, members and/or partners; provided that such
information is provided to such persons and entities with notice that such information is confidential and should be treated as such, (iii) to any prospective purchaser of the Investor's shares
of the Company, provided (in the case of disclosure in clause (iii)) the recipient agrees to keep such information confidential and to use such information
solely for evaluation of such proposed purchase, or (iv) as may otherwise be required by law. Notwithstanding the foregoing, such information shall not be deemed confidential for the purpose of
enforcement of this Agreement and said information shall not be deemed confidential after it becomes publicly known through no fault of the recipient. The provisions of this Section 6.11 shall
be in addition to, and not in substitution for, the provisions of any separate confidentiality agreement executed by the parties hereto; provided that if there is any conflict between the provisions
of this Section 6.11 and the more restrictive provisions of such separate confidentiality agreement, the provisions of such separate confidentiality agreement shall prevail. 

        6.12    Publicity.    No party or any affiliate of a party shall make, or cause to be made, any publicity, news
release or other such general public announcement or make any other disclosure to any third party in respect of this Agreement or the transactions contemplated hereby (including, without limitation,
disclosure of Investor's ownership interest in the Company) without the prior written consent of the other party; provided however, that the foregoing provision is not intended to limit communications
deemed reasonably necessary or appropriate by a party or its affiliates to its employees, stockholders, partners, directors, officers, potential investors, accountants and legal counsel who are under
an obligation to preserve the confidentiality of the foregoing. Notwithstanding the foregoing provision, the parties and their respective affiliates shall not be prohibited from making any disclosure
or release that is required by law, court order, or applicable regulation, or is considered necessary by legal counsel to fulfill an obligation under securities laws or the rules of a national stock
exchange or the NASDAQ National Market. 

        6.13    Entire Agreement.    This Agreement and the documents referred to herein constitute the entire agreement among
the parties and no party shall be liable or bound to any other party in any manner by any warranties, representations, or covenants except as specifically set forth herein or therein. 

        6.14    Legends.    It is understood that the certificates evidencing the Securities may bear one or all of the
following legends: 

        (a)   "These
securities have not been registered under the Securities Act of 1933, as amended. They may not be sold, offered for sale, pledged or hypothecated in the absence
of a registration statement in effect with respect to the securities under such Act or an opinion of counsel satisfactory to the Company that such registration is not required or unless sold pursuant
to Rule 144 of such Act." 

        (b)   Any
legend required by the laws of any state. 

        6.15    Acknowledgement of Notice and Partial Exercise of Rights.    Investor acknowledges that (a) in
connection with the Initial Public Offering that it has received notices required by Section 2.1(d)(i) of Governance Agreement, and (b) its purchase of Class A Common Stock
pursuant to this Agreement is only a partial exercise of its rights pursuant to Section 2.1(d)(i) of Governance Agreement. 

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        6.16    Registrable Securities.    The Class A Common Stock purchased by GSK pursuant to this Agreement shall
constitute Registrable Securities as defined in, and in accordance with the limitations set forth in, the Investors' Rights Agreement. 

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        IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. 

	 	 	THERAVANCE, INC.
	

 	
 	
By:	

 
	 	 	 	
 Rick E Winningham
 President and Chief Executive Officer

SIGNATURE PAGE TO FALL 2004 CLASS A COMMON STOCK PURCHASE AGREEMENT  

	 	INVESTOR:
	

 	

SMITHKLINE BEECHAM CORPORATION
 Name of Investor
	

 	

By:	

 
	 	 	

	 	Signature of Authorized Person

Name:

Title:
	

 	

Address:	

 
	 	 	

	 	

	 	

	

 	

Fax No:
	 	 	

SIGNATURE PAGE TO FALL 2004 CLASS A COMMON STOCK PURCHASE AGREEMENT  

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Exhibit 10.28

THERAVANCE, INC. CLASS A COMMON STOCK PURCHASE AGREEMENT September , 2004

TABLE OF CONTENTS

THERAVANCE, INC. CLASS A COMMON STOCK PURCHASE AGREEMENTQuickLinks
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Exhibit 4.2  

 
 

ARTICLES SUPPLEMENTARY
  APARTMENT INVESTMENT AND MANAGEMENT COMPANY    
    
    Class W Cumulative Convertible Preferred Stock
  (Par Value $.01 Per Share)    
    

        APARTMENT INVESTMENT AND MANAGEMENT COMPANY, a Maryland corporation (hereinafter called the "Corporation"), having its principal office in Baltimore City,
Maryland, hereby certifies to the Department of Assessments and Taxation of the State of Maryland that: 

        FIRST:    Pursuant to authority expressly vested in the Board of Directors of the Corporation by Section 1.2 of
Article IV of the Charter of the Corporation, as amended to date (the "Charter"), the Board of Directors has duly divided and classified 1,904,762 authorized but unissued shares of
Class A Common Stock of the Corporation, par value $.01 per share, into a class designated as Class W Cumulative Convertible Preferred Stock, par value $.01 per share, and has provided
for the issuance of such class. 

        SECOND:    The reclassification increases the number of shares classified as Class W Cumulative Convertible Preferred
Stock, par value $.01 per share, from no shares immediately prior to the reclassification to 1,904,762 shares immediately after the reclassification. The reclassification decreases the number of
shares classified as Class A Common Stock from 433,512,738 shares immediately prior to the reclassification to 431,607,976 shares immediately after the reclassification. The number of shares
classified as Class W Cumulative Convertible Preferred Stock may be decreased pursuant to Section 6 of Article Third of these Articles Supplementary upon reacquisition thereof in any
manner, or by retirement thereof, by the Corporation. 

        THIRD:    The terms of the Class W Cumulative Convertible Preferred Stock (including the preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications, or terms or conditions of redemption) as set by the Board of Directors are as follows: 

1.     Number of Shares and Designation.  

        This class of Preferred Stock shall be designated as Class W Cumulative Convertible Preferred Stock (the "Class W Preferred Stock") and One Million
Nine Hundred Four Thousand Seven Hundred and Sixty-Two (1,904,762) shall be the authorized number of shares of such Class W Preferred Stock constituting such class. 

2.     Definitions.  

        For purposes of the Class W Preferred Stock, the following terms shall have the meanings indicated: 

        "Act" shall mean the Securities Act of 1933, as amended. 

        "affiliate" of a Person means a Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or
is under common control with, the Person specified. 

        "Aggregate Value" shall mean, with respect to any block of Equity Stock of any class, the product of (i) the number of shares of
Equity Stock within such block and (ii) the corresponding Market Price of one share of Equity Stock of such class. 

        "Base Common Stock Dividend" shall have the meaning set forth in paragraph (a) of Section 9 of this Article. 

 

        "Base Rate" shall mean a quarterly dividend payment in an amount per share equal to $1.063125; provided,
however, that, if the Corporation gives notice of its election to make a Dividend Increase
following a Change of Control in accordance with Section 6.4(a) of the Exchange Agreement, then, from and after the date of such notice, the "Base
Rate" shall mean a quarterly dividend payment in an amount per share equal to (i) for all Dividend Periods commencing after the date such notice is given, the greater of
(a) $1.456875 or (b) the product of (x) $13.125 and (y) the sum of 800 basis points plus the greater of (x) the annual yield to maturity of U.S. Treasury securities
with a five year maturity and (y) the annual yield to maturity of U.S. Treasury securities with a ten year maturity, in each case as compiled by and published in the most recent Federal Reserve
Statistical Release H.15(519) which has become publicly available at least two business days prior to the date of such notice (or, if such Statistical Release is no longer published, any
publicly available source of similar data), and (ii) for the Dividend Period in which such notice is given, a weighted average (based on the number of days in such Dividend Period
occurring before and after the date of such notice) of (a) the Base Rate in effect prior thereto and (b) the Base Rate determined in accordance with the foregoing clause (i). 

        "Beneficial Ownership" shall mean, with respect to any Person, ownership of shares of Equity Stock equal to the sum of (without
duplication) (i) the number of shares of Equity Stock directly owned by such Person, (ii) the number of shares of Equity Stock indirectly owned by such Person (if such Person is an
"individual" as defined in Section 542(a)(2) of the Code) taking into account the constructive ownership rules of Section 544 of the Code, as modified by
Section 856(h)(1)(B) of the Code, and (iii) the number of shares of Equity Stock that such Person is deemed to beneficially own pursuant to Rule 13d-3 under the
Exchange Act, or that is attributed to such Person pursuant to Section 318 of the Code, as modified by Section 856(d)(5) of the Code,  provided that when applying this definition of
Beneficial Ownership to the Initial Holder, clause (iii) of this definition, and
clause (ii) of the definition of "Person" shall be disregarded. The terms "Beneficial Owner," "Beneficially
Owns" and "Beneficially Owned" shall have the correlative meanings. 

        "Board of Directors" shall mean the Board of Directors of the Corporation or any committee authorized by such Board of Directors to
perform any of its responsibilities with respect to the Class W Preferred Stock; provided that, for purposes of paragraphs (a) and (b) of Section 9 of this Article, the
term "Board of Directors" shall not include any such committee. 

        "Business Day" shall mean any day other than a Saturday, Sunday or a day on which state or federally chartered banking institutions in New
York, New York are not required to be open. 

        "Change of Control" shall have the meaning set forth in the Exchange Agreement. 

        "Charitable Beneficiary" shall mean one or more beneficiaries of the Trust as determined pursuant to Section 10.3 of this Article,
each of which shall be an organization described in Section 170(b)(1)(A), 170(c)(2) and 501(c)(3) of the Code. 

        "Class A Common Stock" shall mean the Class A Common Stock, par value $.01 per share, of the Corporation, and such other
shares of the Corporation's capital stock into which outstanding shares of such Class A Common Stock shall be reclassified. 

        "Class W Preferred Stock" shall have the meaning set forth in Section 1 of this Article. 

        "Closing Price" shall mean, when used with respect to a share of any Equity Stock and for any date, the last sale price, regular way, or,
in case no such sale takes place on such day, the average of the closing bid and asked prices, regular way, in either case, as reported in the principal consolidated transaction reporting system with
respect to securities listed or admitted to trading on the NYSE or, if the Equity Stock is not listed or admitted to trading on the NYSE, as reported in the principal consolidated transaction
reporting system with respect to securities listed on the principal national securities exchange on which the Equity Stock is listed or admitted to trading or, if the Equity Stock is not listed or
admitted to trading on any national securities exchange, the last quoted price, or if not so 

2

 

quoted,
the average of the high bid and low asked prices in the over-the-counter market, as reported by the National Association of Securities Dealers, Inc. Automated
Quotation System or, if such system is no longer in use, the principal other automated quotation system that may then be in use or, if the Equity Stock is not quoted by any such organization, the
average of the closing bid and asked prices as furnished by a professional market maker making a market in the Equity Stock selected by the Board of Directors of the Corporation or, if the Equity
Stock is not publicly traded, the fair value of a share of such Equity Stock as reasonably determined in good faith by the Board of Directors. 

        "Code" shall mean the Internal Revenue Code of 1986, as amended from time to time, or any successor statute thereto. Reference to any
provision of the Code shall mean such provision as in effect from time to time, as the same may be amended, and any successor thereto, as interpreted by any applicable regulations or other
administrative pronouncements as in effect from time to time. 

        "Conversion Price" shall mean the conversion price per share of Class A Common Stock for which each share of Class W
Preferred Stock is convertible, as such Conversion Price may be adjusted pursuant to Section 7 of this Article. The initial Conversion Price shall be $52.50 (equivalent to a conversion rate of
one share of Class A Common Stock for each share of Class W Preferred Stock). 

        "Dividend Payment Date" shall mean, with respect to each Dividend Period, (a) the date that cash dividends are paid on the
Class A Common Stock with respect to such Dividend Period; or (b) if such dividends have not been paid on the Class A Common Stock by 11:00 a.m., New York City time, on the
sixtieth day from and including the last day of such Dividend Period, then on such day; provided, further, that if any Dividend Payment Date falls on any day other than a Business Day, the dividend
payment payable on such Dividend Payment Date shall be paid on the Business Day immediately following such Dividend Payment Date and no interest shall accrue on such dividend from such date to such
Dividend Payment Date. 

        "Dividend Periods" shall mean the Initial Dividend Period and each subsequent quarterly dividend period commencing on and including
January 1, April 1, July 1 and October 1 of each year and ending on and including the day preceding the first day of the next succeeding Dividend Period, other than the
Dividend Period during which any Class W Preferred Stock shall be redeemed pursuant to Section 5 hereof, which shall end on and include the Redemption Date with respect to the
Class W Preferred Stock being redeemed. 

        "Equity Stock" shall mean one or more shares of any class of capital stock of the Corporation. 

        "Excess Transfer" has the meaning set forth in Section 10.3(a) of this Article. 

        "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended. 

        "Exchange Agreement" shall mean the Exchange Agreement, dated as of September 24, 2004, by and among Security Capital Preferred
Growth Incorporated, the Corporation and AIMCO Properties, L.P. 

        "Fair Market Value" shall mean the average of the daily Closing Prices of a share of Class A Common Stock during the twenty
(20) consecutive Trading Days before, and ending not later than, the earlier of the day in question and the day before the "ex date" with respect to the issuance or distribution requiring such
computation. The term "ex date," when used with respect to any issuance or distribution, means the first day on which the share of Class A Common Stock trades regular way, without the right to
receive such issuance or distribution, on the exchange or in the market, as the case may be, used to determine that day's Closing Price. 

        "Initial Dividend Period" shall mean the period commencing on and including October 1, 2004, and ending on and including
December 31, 2004. 

        "Initial Holder" shall mean Terry Considine. 

3

 

        "Initial Holder Limit" shall mean a number of the Outstanding shares of Class W Preferred Stock of the Corporation having an
Aggregate Value not in excess of the excess of (x) 15% of the Aggregate Value of all Outstanding shares of Equity Stock over (y) the Aggregate Value of all shares of Equity Stock
other than Class W Preferred Stock that are Beneficially Owned by the Initial Holder. From the Issue Date, the secretary of the Corporation, or such other person as shall be designated by the
Board of Directors, shall upon request make available to the representative(s) of the Initial Holder and the Board of Directors, a schedule that sets forth the then-current Initial Holder
Limit applicable to the Initial Holder. 

        "Issue Date" shall mean September 30, 2004. 

        "Junior Stock" shall have the meaning set forth in paragraph (c) of Section 8 of this Article. 

        "Liquidation Preference" shall have the meaning set forth in paragraph (a) of Section 4 of this Article. 

        "Look-Through Entity" shall mean a Person that is either (i) described in Section 401(a) of the Code as
provided under Section 856(h)(3) of the Code or (ii) registered under the Investment Company Act of 1940. 

        "Look-Through Ownership Limit" shall mean, for any Look-Through Entity, a number of the Outstanding shares of
Class W Preferred Stock of the Corporation having an Aggregate Value not in excess of the excess of (x) 15% of the Aggregate Value of all Outstanding shares of Equity Stock over
(y) the Aggregate Value of all shares of Equity Stock other than Class W Preferred Stock that are Beneficially Owned by the Look-Through Entity. 

        "Market Price" on any date shall mean, with respect to any share of Equity Stock, the Closing Price of a share of that class of Equity
Stock on the Trading Day immediately preceding such date. 

        "NYSE" shall mean The New York Stock Exchange, Inc. 

        "Outstanding" shall mean issued and outstanding shares of Equity Stock of the Corporation, provided,
however, that for purposes of the application of the Ownership Limit, the Look-Through Ownership Limit or the Initial Holder Limit to any Person, the term
"Outstanding" shall be deemed to include the number of shares of Equity Stock that such Person alone, at that time, could acquire pursuant to any
options or convertible securities. 

        "Ownership Limit" shall mean, for any Person other than the Initial Holder or a Look-Through Entity, a number of the
Outstanding shares of Class W Preferred Stock of
the Corporation having an Aggregate Value not in excess of the excess of (x) 8.7% of the Aggregate Value of all Outstanding shares of Equity Stock over (y) the Aggregate Value of all
shares of Equity Stock other than Class W Preferred Stock that are Beneficially Owned by the Person. 

        "Ownership Restrictions" shall mean, collectively, the Ownership Limit, as applied to Persons other than the Initial Holder or
Look-Through Entities, the Initial Holder Limit, as applied to the Initial Holder, and the Look-Through Ownership Limit, as applied to Look-Through Entities. 

        "Parity Stock" shall have the meaning set forth in paragraph (b) of Section 8 of this Article. 

        "Person" shall mean (a) for purposes of Section 10 of this Article, (i) an individual, corporation, partnership,
estate, trust (including a trust qualifying under Section 401(a) or 501(c) of the Code), association, "private foundation," within the meaning of Section 509(a) of
the Code, joint stock company or other entity, and (ii) a "group," as that term is used for purposes of Section 13(d)(3) of the Exchange Act, and (b) for purposes of the
remaining Sections of this Article, any individual, firm, partnership, corporation or other entity, including any successor (by merger or otherwise) of such entity. 

4

 

        "Prohibited Transferee" shall have the meaning set forth in Section 10.3(a) of this Article. 

        "Redemption Date" shall mean, in the case of any redemption of any shares of Class W Preferred Stock, the date fixed for redemption
of such shares. 

        "Redemption Price" shall mean, with respect to any share of Class W Preferred Stock to be redeemed, 102% of the Liquidation
Preference thereof, plus all accumulated, accrued and unpaid dividends (whether or not earned or declared), if any, to the Redemption Date. 

        "REIT" shall mean a "real estate investment trust," as defined in Section 856 of the Code. 

        "Repurchase Offer" shall have the meaning set forth in the Exchange Agreement. 

        "Senior Stock" shall have the meaning set forth in paragraph (a) of Section 8 of this Article. 

        "set apart for payment" shall be deemed to include, without any action other than the following, the recording by the Corporation in its
accounting ledgers of any accounting or bookkeeping entry which indicates, pursuant to a declaration of dividends or other distribution by the Board of Directors, the allocation of funds to be so paid
on any series or class of capital stock of the Corporation; provided, however, that if any funds for any class or series of Junior Stock or any class or
series of Parity Stock are placed in a separate account of the Corporation or delivered to a disbursing, paying or other similar agent, then "set apart for payment" with respect to the Class W
Preferred Stock shall mean placing such funds in a separate account or delivering such funds to a disbursing, paying or other similar agent. 

        "Trading Day" shall mean, when used with respect to any Equity Stock, (i) if the Equity Stock is listed or admitted to trading on
the NYSE, a day on which the NYSE is open for the transaction of business, (ii) if the Equity Stock is not listed or admitted to trading on the NYSE but is listed or admitted to trading on
another national securities exchange or automated quotation system, a day on which the principal national securities exchange or automated quotation system, as the case may be, on which the Equity
Stock is listed or admitted to trading is open for the transaction of business, or (iii) if the Equity Stock is not listed or admitted to trading on any national securities exchange or
automated quotation system, any day other than a Saturday, a Sunday or a day on which banking institutions in the State of New York are authorized or obligated by law or executive order to close. 

        "Transfer" shall mean any sale, transfer, gift, assignment, devise or other disposition of a share of Class W Preferred Stock
(including (i) the granting of an option or any series of such options or entering into any agreement for the sale, transfer or other disposition of Class W Preferred Stock or
(ii) the sale, transfer, assignment or other disposition of any securities or rights convertible into or exchangeable for Class W Preferred Stock), whether voluntary or involuntary,
whether of record ownership or Beneficial Ownership, and whether by operation of law or otherwise (including, but not limited to, any transfer of an interest in other entities that results in a change
in the Beneficial Ownership of shares of Class W Preferred Stock). The term "Transfers" and
"Transferred" shall have correlative meanings. 

        "Transfer Agent" means such transfer agent as may be designated by the Board of Directors or their designee as the transfer agent for the
Class W Preferred Stock; provided, that if the Corporation has not designated a transfer agent then the Corporation shall act as the transfer agent for the Class W Preferred Stock. 

        "Trust" shall mean the trust created pursuant to Section 10.3 of this Article. 

        "Trustee" shall mean the Person unaffiliated with either the Corporation or the Prohibited Transferee that is appointed by the Corporation
to serve as trustee of the Trust. 

        "Voting Preferred Stock" shall have the meaning set forth in Section 9 of this Article. 

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3.     Dividends.  

        (a)   The
holders of Class W Preferred Stock shall be entitled to receive, when and as declared by the Board of Directors out of funds legally available for that
purpose, cumulative dividends payable in cash in an amount per share of Class W Preferred Stock equal to the greater of (i) the Base Rate, or (ii) the cash dividends declared on
the number of shares of Class A Common Stock, or portion thereof, into which a share of Class W Preferred Stock is convertible. The dividends payable with respect to the Initial Dividend
Period shall be determined solely by reference to the Base Rate. The amount referred to in clause (ii) of this paragraph (a) with respect to each succeeding Dividend Period
shall be determined as of the applicable Dividend Payment Date by multiplying the number of shares of Class A Common Stock, or portion thereof calculated to the fourth decimal point, into which
a share of Class W Preferred Stock would be convertible at the opening of business on such Dividend Payment Date (based on the Conversion Price then in effect) by the aggregate cash dividends
payable or paid for such Dividend Period in respect of a share of Class A Common Stock outstanding as of the record date for the payment of dividends on the Class A Common Stock with
respect to such Dividend Period. If (A) the Corporation pays a cash dividend on the Class A Common Stock after the Dividend Payment Date for the corresponding Dividend Period and
(B) the dividend on the Class W Preferred Stock for such Dividend Period calculated pursuant to clause (ii) of this paragraph (a), taking into account the
Class A Common Stock dividend referenced in clause (A), exceeds the dividend previously declared on the Class W Preferred Stock for such Dividend Period, the Corporation shall pay
an additional dividend to the holders of the Class W Preferred Stock on the date that the Class A Common Stock dividend referenced in clause (A) is paid, in an amount equal
to the difference between the dividend calculated pursuant to clause (B) and the dividends previously declared on the Class W Preferred Stock with respect to such Dividend Period.
Such dividends shall be cumulative from the Issue Date, whether or not in any Dividend Period or Periods such dividends shall be declared or there shall be funds of the Corporation legally available
for the payment of such dividends, and shall be payable quarterly in arrears on the Dividend Payment Dates, commencing on the first Dividend Payment Date after the Issue Date. Each such dividend shall
be payable in arrears to the holders of record of the Class W Preferred Stock, as they appear on the stock records of the Corporation at the close of business on a record date fixed by the
Board of Directors which shall be not more than 60 days prior to the applicable Dividend Payment Date and, within such 60 day period, shall be the same date as the record date for the
regular quarterly dividend payable with respect to the Class A Common Stock for the Dividend Period to which such Dividend Payment Date relates (or, if there is no such record date for
Class A Common Stock, then such date as the Board of Directors may fix). Accumulated, accrued and unpaid dividends for any past Dividend Periods may be declared and paid at any time, without
reference to any regular Dividend Payment Date, to holders of record on such date, which date shall not precede by more than 45 days the payment date thereof, as may be fixed by the Board of
Directors. 

        (b)   The
amount of dividends payable per share of Class W Preferred Stock for the Initial Dividend Period, or any other period shorter than a full Dividend Period,
shall be computed ratably on the basis of twelve 30-day months and a 360-day year. Holders of Class W Preferred Stock shall not be entitled to any dividends,
whether payable in cash, property or stock, in excess of cumulative dividends, as herein provided, on the Class W Preferred Stock. No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on the Class W Preferred Stock that may be in arrears. 

        (c)   So
long as any of the shares of Class W Preferred Stock are outstanding, except as described in the immediately following sentence, no dividends shall be declared
or paid or set apart for payment by the Corporation and no other distribution of cash or other property shall be declared or made directly or indirectly by the Corporation with respect to any class or
series of Parity Stock for any period unless dividends equal to the full amount of accumulated, accrued and unpaid dividends have 

6

 

been
or contemporaneously are declared and paid or declared and a sum sufficient for the payment thereof has been or contemporaneously is set apart for such payment on the Class W Preferred
Stock for all Dividend Periods terminating on or prior to the date such dividend or distribution is declared, paid, set apart for payment or made, as the case may be, with respect to such class or
series of Parity Stock. When dividends are not paid in full or a sum sufficient for such payment is not set apart, as aforesaid, all dividends declared upon the Class W Preferred Stock and all
dividends declared upon any other class or series of Parity Stock shall be declared ratably in proportion to the respective amounts of dividends accumulated, accrued and unpaid on the Class W
Preferred Stock and accumulated, accrued and unpaid on such Parity Stock. 

        (d)   So
long as any of the shares of Class W Preferred Stock are outstanding, no dividends (other than dividends or distributions paid in shares of or options,
warrants or rights to subscribe for or purchase shares of Junior Stock) shall be declared or paid or set apart for payment by the Corporation and no other distribution of cash or other property shall
be declared or made directly or indirectly by the Corporation with respect to any shares of Junior Stock, nor shall any shares of Junior Stock be redeemed, purchased or otherwise acquired (other than
a redemption, purchase or other acquisition of Class A Common Stock made for purposes of an employee incentive or benefit plan of the Corporation or any subsidiary) for any consideration (or
any moneys be paid to or made available for a sinking fund for the redemption of any shares of any such stock) directly or indirectly by the Corporation (except by conversion into or exchange for
shares of, or options, warrants or rights to subscribe for or purchase shares of, Junior Stock), nor shall any other cash or other property otherwise be paid or distributed to or for the benefit of
any holder of shares of Junior Stock in respect thereof, directly or indirectly, by the Corporation unless in each case (i) dividends equal to the full amount of all accumulated, accrued and
unpaid dividend on all outstanding shares of Class W Preferred Stock have been declared and paid, or such dividends have been declared and a sum sufficient for the payment thereof has been set
apart for such payment, on all outstanding shares of Class W Preferred Stock for all Dividend Periods ending on or prior to the date such dividend or distribution is declared, paid, set apart
for payment or made with respect to such shares of Junior Stock, or the date such shares of Junior Stock are redeemed, purchased or otherwise acquired or monies paid to or made available for any
sinking fund for such redemption, or the date any such cash or other property is paid or distributed to or for the benefit of any holders of Junior Stock in respect thereof, as the case may be and
(ii) sufficient funds shall have been paid or set apart for the payment of the full dividend for the current Dividend Period with respect to the Class W Preferred Stock. 

        Notwithstanding
the provisions of this Section 3, the Corporation shall not be prohibited from (i) declaring or paying or setting apart for payment any dividend or
distribution on any shares of Parity Stock or (ii) redeeming, purchasing or otherwise acquiring any Parity Stock, in each case, if in the opinion of nationally recognized REIT tax counsel such
declaration, payment, redemption, purchase or other acquisition is necessary in order to maintain the continued qualification of the Corporation as a REIT under Section 856 of the Code. 

4.     Liquidation Preference.  

        (a)   In
the event of any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary, before any payment or distribution by the Corporation
(whether of capital, surplus or otherwise) shall be made to or set apart for the holders of Junior Stock, the holders of shares of Class W Preferred Stock shall be entitled to receive Fifty Two
Dollars and Fifty Cents ($52.50) per share of Class W Preferred Stock (the "Liquidation Preference"), plus an amount equal to all dividends (whether or not earned or declared) accumulated,
accrued and unpaid thereon to the date of final distribution to such holders; but such holders shall not be entitled to any further payment. Until the holders of the Class W Preferred Stock
have been paid the Liquidation Preference in full, plus an amount equal to all dividends (whether or not earned or declared) accumulated, accrued and 

7

 

unpaid
thereon to the date of final distribution to such holders, no payment will be made to any holder of Junior Stock upon the liquidation, dissolution or winding up of the Corporation. If, upon any
liquidation, dissolution or winding up of the Corporation, the assets of the Corporation, or proceeds thereof, distributable among the holders of Class W Preferred Stock shall be insufficient
to pay in full the preferential amount aforesaid and liquidating payments on any other shares of any class or series of Parity Stock, then such assets, or the proceeds thereof, shall be distributed
among the holders of Class W Preferred Stock and any such other Parity Stock ratably in the same proportion as the respective amounts that would be payable on such Class W Preferred
Stock and any such other Parity Stock if all amounts payable thereon were paid in full. For the purposes of this Section 4, (i) a consolidation or merger of the Corporation with one or
more corporations, (ii) a sale or transfer of all or substantially all of the Corporation's assets, or (iii) a statutory share exchange shall not be deemed to be a liquidation,
dissolution or winding up, voluntary or involuntary, of the Corporation. 

        (b)   Upon
any liquidation, dissolution or winding up of the Corporation, after payment shall have been made in full to the holders of Class W Preferred Stock and any
Parity Stock, as provided in Section 4(a), any other series or class or classes of Junior Stock shall, subject to the respective terms thereof, be entitled to receive any and all assets
remaining to be paid or distributed, and the holders of the Class W Preferred Stock and any Parity Stock shall not be entitled to share therein. 

5.     Redemption at the Option of the Corporation.  

        (a)   Shares
of Class W Preferred Stock shall not be redeemable by the Corporation prior to the third anniversary of the Issue Date, except as set forth in
Section 10.2 of this Article. On and after the third anniversary of the Issue Date, the Corporation, at its option, may redeem shares of Class W Preferred Stock, in whole or from time to
time in part, at a price payable in cash equal to the Redemption Price applicable thereto. 

        (b)   The
Redemption Date shall be selected by the Corporation, shall be specified in the notice of redemption and shall be not less than 30 days nor more than
60 days after the date notice of redemption is sent by the Corporation. 

        (c)   If
full cumulative dividends on all outstanding shares of Class W Preferred Stock have not been declared and paid, or declared and set apart for payment, no
shares of Class W Preferred Stock may be redeemed unless all outstanding shares of Class W Preferred Stock are simultaneously redeemed. Neither the Corporation nor any affiliate of the
Corporation may purchase or acquire shares of Class W Preferred Stock, other than pursuant to a purchase or exchange offer made on the same terms to all holders of shares of Class W
Preferred Stock. 

        (d)   If
the Corporation shall redeem shares of Class W Preferred Stock pursuant to paragraph (a) of this Section 5, notice of such redemption
shall be given to each holder of record of the shares to be redeemed. Such notice shall be provided by recognized overnight courier at such holder's address as the same appears on the stock records of
the Corporation. Neither the failure to mail any notice required by this paragraph (d), nor any defect therein or in the mailing thereof to any particular holder, shall affect the sufficiency
of the notice or the validity of the proceedings for redemption with respect to the other holders. Any notice mailed in the manner herein provided shall be conclusively presumed to have been duly
given on the day after the date mailed whether or not the holder receives the notice. Each such notice shall state, as appropriate: (i) the Redemption Date; (ii) the number of shares of
Class W Preferred Stock to be redeemed and, if fewer than all such shares held by such holder are to be redeemed, the number of such shares to be redeemed from such holder; (iii) the
place or places at which certificates for such shares are to be surrendered for cash; (iv) the then-current Conversion Price; (v) the Redemption Price payable on such
Redemption Date; and (vi) a statement as to whether or not accumulated, accrued and unpaid dividends will be payable as part of the Redemption Price, or payable on the next Dividend Payment
Date to the record holder at the close 

8

 

of
business on the relevant record date as described in the next sentence. Notice having been mailed as aforesaid, from and after the Redemption Date (unless the Corporation shall fail to make
available the amount of cash necessary to effect such redemption), (i) dividends on the shares of Class W Preferred Stock so called for redemption shall cease to accumulate or accrue on
the shares of Class W Preferred Stock called for redemption, (ii) said shares shall no longer be deemed to be outstanding, and (iii) all rights of the holders thereof as holders
of Class W Preferred Stock of the Corporation shall cease (except the right to receive the cash payable upon such redemption, without interest thereon, upon surrender and endorsement of their
certificates if so required); provided, however, that if the Redemption Date for any shares of Class W Preferred Stock occurs after any dividend
record date and on or prior to the related Dividend Payment Date, the full dividend payable on such Dividend Payment Date in respect of such shares of Class W Preferred Stock called for
redemption shall be payable on such Dividend Payment Date to the holders of record of such shares at the close of business on the corresponding dividend record date notwithstanding the prior
redemption of such shares and shall not be payable as part of the Redemption Price for such shares. The Corporation's obligation to make available the cash necessary to effect the redemption in
accordance with the preceding sentence shall be deemed fulfilled if, on or before the applicable Redemption Date, the Corporation shall irrevocably deposit in trust with a bank or trust company (which
may not be an affiliate of the Corporation) that has, or is an affiliate of a bank or trust company that has, a capital and surplus of at least $50,000,000, such amount of cash as is necessary for
such redemption, plus, if such Redemption Date occurs after any dividend record date and on or prior to the related Dividend Payment Date, such amount of cash as is necessary to pay the dividend
payable on such Dividend Payment Date in respect of such shares of Class W Preferred Stock called for redemption, with irrevocable instructions that such cash be applied to the redemption of
the shares of Class W Preferred Stock so called for redemption and, if applicable, the payment of such dividend. No interest shall accrue for the benefit of the holders of shares of
Class W Preferred Stock to be redeemed on any cash so set aside by the Corporation. Subject to applicable escheat laws, any such cash unclaimed at the end of two years from the
Redemption Date shall revert to the general funds of the Corporation, after which reversion the holders of shares of Class W Preferred Stock so called for redemption shall look only to the
general funds of the Corporation for the payment of such cash. 

        As
promptly as practicable after the surrender in accordance with such notice of the certificates for any such shares of Class W Preferred Stock to be so redeemed (properly
endorsed or assigned for transfer,
if the Corporation shall so require and the notice shall so state), such certificates shall be exchanged for cash (without interest thereon) for which such shares have been redeemed in accordance with
such notice. If fewer than all the outstanding shares of Class W Preferred Stock are to be redeemed, shares to be redeemed shall be selected by the Corporation from outstanding shares of
Class W Preferred Stock not previously called for redemption by lot or, with respect to the number of shares of Class W Preferred Stock held of record by each holder of such shares, pro
rata (as nearly as may be) or by any other method as may be determined by the Board of Directors in its discretion to be equitable. If fewer than all the shares of Class W Preferred Stock
represented by any certificate are redeemed, then a new certificate representing the unredeemed shares shall be issued without cost to the holders thereof. 

6.     Status of Reacquired Stock.  

        All shares of Class W Preferred Stock that have been issued and reacquired in any manner by the Corporation (including, without limitation, shares of
Class W Preferred Stock which have been surrendered for conversion) shall be returned to the status of authorized but unissued shares of Class W Preferred Stock. 

9

 

7.     Conversion.  

        7.1   Conversion at Holders Option.

        At
any time on or after the Issue Date, holders of shares of Class W Preferred Stock shall have the right to convert all or a portion of such shares into shares of Class A
Common Stock, as follows: 

        (a)   Subject
to and upon compliance with the provisions of this Section 7, each share of Class W Preferred Stock shall, at the option of the holder thereof, be
convertible at any time (unless such share is called for redemption, then to and including but not after the close of business on the date immediately prior to the Redemption Date, unless the
Corporation shall default in payment due upon redemption thereof), in whole or in part, into the number of fully paid and non-assessable shares of Class A Common Stock (calculated
as to each conversion to the nearest 1/100th of a share) obtained by dividing the Liquidation Preference (excluding any accumulated, accrued and unpaid dividends) per share of Class W Preferred
Stock by the Conversion Price (as in effect at the time and on the date provided for in paragraph (b) of this Section 7.1) and by surrendering such shares to be converted, such
surrender to be made in the manner provided in paragraph (b) of this Section 7.1; provided, however, that the right to convert
shares of Class W Preferred Stock called for redemption pursuant to Section 5 shall terminate at the close of business on the Redemption Date fixed for such redemption, unless the
Corporation shall default in making payment of cash payable upon such redemption under Section 5 of this Article. 

        (b)   To
convert shares of Class W Preferred Stock, the holder of the shares to be converted shall surrender the certificate representing such shares at the office of
the Transfer Agent, accompanied by the funds, if any, required by the last paragraph of this subsection (b) to be paid by such holder, and shall give written notice of conversion in the
form provided on such certificate representing shares of Class W Preferred Stock (or such other notice as is reasonably acceptable to the Corporation) to the Corporation at such office or
agency that the holder elects to convert the shares of Class W Preferred Stock specified in such notice. Such notice shall also state the name or names, together with address or addresses, in
which the certificate or certificates for shares of Class A Common Stock which shall be issuable on such conversion shall be issued. Unless the shares issuable on conversion are to be issued in
the same name as the name in which such share of Class W Preferred Stock is registered, each certificate representing a share of Class W Preferred Stock surrendered for conversion shall
be accompanied by instruments of transfer, in form satisfactory to the Corporation, duly executed by the holder or such holder's duly authorized attorney and an amount sufficient to pay any transfer
or similar tax (or evidence reasonably satisfactory to the Corporation that such taxes have been paid). 

        As
promptly as practicable, but in no event later than three Business Days after the surrender of certificates representing such shares of Class W Preferred Stock and the receipt
of such notice, instruments of transfer and funds, if any, as aforesaid, the Corporation shall issue and shall deliver at such office or agency to such holder, or as designated in such holder's
written instructions, a certificate or certificates for the number of full shares of Class A Common Stock issuable upon the conversion of such share or shares of Class W Preferred Stock
in accordance with provisions of this Section 7.1, and a check or cash in respect of the cash amount payable to such holder, if any, referred to in subsection (c), below. 

        Each
conversion shall be deemed to have been effected immediately prior to the close of business on the date on which certificates representing such shares of Class W Preferred
Stock shall have been surrendered and such notice (and any applicable instruments of transfer and any required taxes) received by the Corporation as aforesaid, and the Person or Persons in whose name
or names any certificate or certificates for shares of Class A Common Stock shall be issuable upon such conversion shall be deemed to have become the holder or holders of record of the shares
represented thereby at such time on such date, and such conversion shall be at the Conversion Price in effect at such time on such date, unless the stock transfer books of the Corporation shall be
closed on that date, in which 

10

 

event
such Person or Persons shall be deemed to have become such holder or holders of record at the close of business on the next succeeding day on which such stock transfer books are open, but such
conversion shall be at the Conversion Price in effect on the date on which such shares shall have been surrendered and such notice received by the Corporation. 

        Except
as provided herein, the Corporation will make no payment or allowance for unpaid dividends, whether or not in arrears, on converted shares or for dividends (other than dividends
on the Class A Common Stock the record date for which is after the conversion date and which the Corporation shall pay in the ordinary course to the record holder as of the record date) on the
Class A Common Stock issued upon such conversion. Holders of Class W Preferred Stock at the close of business on a record date for the payment of dividends on the Class W
Preferred Stock will be entitled to receive an amount equal to the dividend payable on such shares on the corresponding Dividend Payment Date notwithstanding the conversion of such shares following
such record date. If the Dividend Adjustment Amount (as defined below) with respect to any shares of Class W Preferred Stock surrendered for conversion is positive, the holders of such shares
shall, as of the date of conversion, be entitled to receive a cash payment equal to such Dividend Adjustment Amount. If the Dividend Adjustment Amount with respect to any shares of Class W
Preferred Stock surrendered for conversion is negative, such shares must be accompanied by payment of a cash amount equal to the absolute value of such Dividend Adjustment Amount. As used herein,
"Dividend Adjustment Amount" shall mean, with respect to any share of Class W Preferred Stock that has been surrendered for conversion, the sum of: 

        (i)    the
aggregate amount of any dividends (whether or not earned or declared) that are accumulated, accrued and unpaid on such share as of the time of such conversion;  minus

        (ii)   if
such share has been surrendered for conversion during the period between the close of business on any dividend record date and the opening of business on the
corresponding Dividend Payment Date, the amount of the dividend payable thereon on such Dividend Payment Date; minus

        (iii)  an
amount equal to the product of (A) the number of shares of Class A Common Stock (or fraction thereof) into which such share of Class W
Preferred Stock has been converted, (B) the quarterly cash dividend per share that was most recently declared on the Class A Common Stock, determined as of the date of conversion, and
(C) a fraction, the numerator of which is the number of days in the period from
and including the date of the most recent dividend payment date for the Class A Common Stock to but excluding the date of such conversion, and the denominator of which is 90. 

        (c)   No
fractional shares of Class A Common Stock or scrip representing fractions of a share of Class A Common Stock shall be issued upon conversion of shares
of Class W Preferred Stock. If more than one share of Class W Preferred Stock shall be surrendered for conversion at one time by the same holder, the number of full shares of
Class A Common Stock issuable upon conversion thereof shall be computed on the basis of the aggregate number of shares of Class W Preferred Stock so converted. In lieu of any fractional
interest in a share of Class A Common Stock that would otherwise be deliverable upon the conversion of any share of Class W Preferred Stock, the Corporation shall pay to the holder of
such shares an amount in cash (computed to the nearest cent) equal to the Closing Price of the Class A Common Stock on the Trading Day immediately preceding the date of conversion, multiplied
by the fractional interest that otherwise would have been deliverable upon conversion of such share. 

        7.2   Adjustments to Conversion Price

        (a)   The
Conversion Price shall be adjusted from time to time as follows: 

        (i)    If
the Corporation shall, after the Issue Date, (A) pay a dividend or make a distribution on its Class A Common Stock in shares of Class A Common
Stock, (B) subdivide its outstanding 

11

 

Class A
Common Stock into a greater number of shares, (C) combine its outstanding Class A Common Stock into a smaller number of shares or (D) issue any shares of capital
stock by reclassification of its outstanding Class A Common Stock (including a reclassification pursuant to a merger or consolidation in which the Corporation is the continuing entity and in
which the Class A Common Stock outstanding immediately prior to the merger or consolidation is not exchanged for cash, or securities or other property of another entity), then, in each such
case the Conversion Price in effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or distribution or at the
opening of business on the day following the day on which such subdivision, combination or reclassification becomes effective, as the case may be, shall be adjusted so that the holder of any share of
Class W Preferred Stock thereafter surrendered for conversion shall be entitled to receive the number of shares of Class A Common Stock (or fraction of a share of Class A Common
Stock) that such holder would have owned or have been entitled to receive after the happening of any of the events described above had such share of Class W Preferred Stock been converted
immediately prior to the record date in the case of a dividend or distribution or the effective date in the case of a subdivision, combination or reclassification. An adjustment made pursuant to this
paragraph (a)(i) of this Section 7.2 shall become effective immediately after the opening of business on the day next following the record date (except as provided in
paragraph (e) below) in the case of a dividend or distribution and shall become effective immediately after the opening of business on the day next following the effective date in the
case of a subdivision, combination or reclassification. 

        (ii)   If
the Corporation shall issue, after the Issue Date, rights, options or warrants to all holders of Class A Common Stock entitling them (for a period expiring
within 45 days after the record date described below in this paragraph (a)(ii) of this Section 7.2) to subscribe for or purchase Class A Common Stock at a price per
share less than the Fair Market Value per share of the Class A Common Stock on the record date for the determination of stockholders entitled to receive such rights, options or warrants, then
the Conversion Price in effect at the opening of business on the day next following such record date shall be adjusted to equal the price determined by multiplying (A) the Conversion Price in
effect immediately prior to the opening of business on the day following the date fixed for such determination by (B) a fraction, the numerator of which shall be the sum of (X) the
number of shares of Class A Common Stock outstanding on the close of business on the date fixed for such determination and (Y) the number of shares that could be purchased at such Fair
Market Value from the aggregate proceeds to the Corporation from the exercise of such rights, options or warrants for Class A Common Stock, and the denominator of which shall be the sum of
(XX) the number of shares of Class A Common Stock outstanding on the close of business on the date fixed for such determination and (YY) the number of additional shares of Class A
Common Stock offered for subscription or purchase pursuant to such rights, options or warrants. Such adjustment shall become effective immediately after the opening of business on the day next
following such record date (except as provided in paragraph (e) below). In determining whether any rights, options or warrants entitle the holders of Class A Common Stock to
subscribe for or purchase Class A Common Stock at less than such Fair Market Value, there shall be taken into account any consideration received by the Corporation upon issuance and upon
exercise of such rights, options or warrants, the value of such consideration, if other than cash, to be determined in good faith by the Board of Directors. 

12

  

        (iii)  If
the Corporation shall, after the Issue Date, make a distribution on its Class A Common Stock other than in cash or shares of Class A Common Stock
(including any distribution in securities (other than rights, options or warrants referred to in paragraph (a)(ii) of this Section 7.2)) (each of the foregoing being referred to
herein as a "distribution"), then the Conversion Price in effect at the opening of business on the next day following the record date for determination of stockholders entitled to receive such
distribution shall be adjusted to equal the price determined by multiplying (A) the Conversion Price in effect immediately prior to the opening of business on the day following the record date
by (B) a fraction, the numerator of which shall be the difference between (X) the number of shares of Class A Common Stock outstanding on the close of business on the record date
and (Y) the number of shares determined by dividing (aa) the aggregate value of the property being distributed by (bb) the Fair Market Value per share of Class A Common Stock on the
record date, and the denominator of which shall be the number of shares of Class A Common Stock outstanding on the close of business on the record date. Such adjustment shall become effective
immediately after the opening of business on the day next following such record date (except as provided below). The value of the property being distributed shall be as determined in good faith by the
Board of Directors; provided, however, that if the property being distributed is a publicly traded security, its value shall be calculated in accordance
with the procedure for calculating the Fair Market Value of a share of Class A Common Stock (calculated for a period of five consecutive Trading Days commencing on the twentieth Trading Day
after the distribution). Neither the issuance by the Corporation of rights, options or warrants to subscribe for or purchase securities of the Corporation nor the exercise thereof shall be deemed a
distribution under this paragraph. 

        (iv)  If,
after the Issue Date, the Corporation shall acquire, pursuant to an issuer or self tender offer, all or any portion of the outstanding Class A Common Stock
and such tender offer involves the payment of consideration per share of Class A Common Stock having a fair market value (as determined in good faith by the Board of Directors), at the last
time (the "Expiration Time") tenders may be made pursuant to such offer, that exceeds the Closing Price per share of Class A Common Stock on the Trading Day next succeeding the Expiration Time,
then the Conversion Price in effect on the opening of business on the day next succeeding the Expiration Time shall be adjusted to equal the price determined by multiplying (A) the Conversion
Price in effect immediately prior to the Expiration Time by (B) a fraction, the numerator of which shall be (X) the number of shares of Class A Common Stock outstanding (including
the shares acquired in the tender offer (the "Acquired Shares")) immediately prior to the Expiration Time, multiplied by (Y) the Closing Price per share of Class A Common Stock on the
Trading Day next succeeding the Expiration Time, and the denominator of which shall be the sum of (XX) the fair market value (determined as aforesaid) of the aggregate consideration paid to
acquire the Acquired Shares and (YY) the product of (I) the number of shares of Class A Common Stock outstanding (less any Acquired Shares) at the Expiration Time, multiplied by
(II) the Closing Price per share of Class A Common Stock on the Trading Day next succeeding the Expiration Time. 

        (v)   No
adjustment in the Conversion Price shall be required unless such adjustment would require a cumulative increase or decrease of at least 1% in such price;  provided, however, that any adjustments that by
reason of this paragraph (a)(v) are not required to be made shall be carried forward and
taken into account in any subsequent adjustment until made; provided, further, that any adjustment shall be required and made in accordance with the
provisions of this Section 7.2 (other than this paragraph (a)(v)) not later than such time as may be required in order to preserve the tax-free nature of a distribution to
the holders of shares of Class A Common Stock. Notwithstanding any other provisions of this Section 7.2, the Corporation shall not be required to make any adjustment of the Conversion
Price for the issuance of (A) any shares of Class A Common Stock pursuant to any plan providing for the reinvestment of dividends or interest payable on securities of the Corporation and
the investment of optional amounts in shares of 

13

 

Class A
Common Stock under such plan or (B) any options, rights or shares of Class A Common Stock pursuant to any stock option, stock purchase or other stock-based plan maintained
by the Corporation. All calculations under this Section 7.2 shall be made to the nearest cent (with $.005 being rounded upward) or to the nearest one-tenth of a share (with .05 of a
share being rounded upward), as the case may be. Anything in this paragraph (a) of this Section 7.2 to the contrary notwithstanding, the Corporation shall be entitled, to the
extent permitted by law, to make such reductions in the Conversion Price, in addition to those required by this paragraph (a), as it in its discretion shall determine to be advisable in order
that any stock dividends, subdivision of shares, reclassification or combination of shares, distribution of rights or warrants to purchase stock or securities, or a distribution of other assets (other
than cash dividends) hereafter made by the Corporation to its stockholders shall not be taxable, or if that is not possible, to diminish any income taxes that are otherwise payable because of such
event. 

        (b)   If
the Corporation shall be a party to any transaction (including without limitation a merger, consolidation, statutory share exchange, issuer or self tender offer for
at least 30% of the shares of Class A Common Stock outstanding, sale of all or substantially all of the Corporation's assets or recapitalization of the Class A Common Stock, but
excluding any transaction as to which paragraph (a)(i) of this Section 7.2 applies) (each of the foregoing being referred to herein as a "Transaction"), in each case, as a result
of which shares of Class A Common Stock shall be converted into the right to receive stock, securities or other property (including cash or any combination thereof), each share of
Class W Preferred Stock which is not converted into the right to receive stock, securities or other property in connection with such Transaction shall thereupon be convertible into the kind and
amount of shares of stock, securities and other property (including cash or any combination thereof) receivable upon such consummation by a holder of that number of shares of Class A Common
Stock into which one share of Class W Preferred Stock was convertible immediately prior to such Transaction (without giving effect to any Conversion Price adjustment pursuant to
Section 7.2(a)(iv) of this Article). The Corporation shall not be a party to any Transaction unless the terms of such Transaction are consistent with the provisions of this
paragraph (b), and it shall not consent or agree to the occurrence of any Transaction until the Corporation has entered into an agreement with the successor or purchasing entity, as the case
may be, for the benefit of the holders of the Class W Preferred Stock that will contain provisions enabling the holders of the Class W Preferred Stock that remain outstanding after such
Transaction to convert into the consideration received by holders of Class A Common Stock at the Conversion Price in effect immediately prior to such Transaction. The provisions of this
paragraph (b) shall similarly apply to successive Transactions. 

        (c)   If:

        (i)    the
Corporation shall declare a dividend (or any other distribution) on the Class A Common Stock (other than cash dividends and cash distributions); or 

        (ii)   the
Corporation shall authorize the granting to all holders of the Class A Common Stock of rights or warrants to subscribe for or purchase any shares of any
class or series of capital stock or any other rights or warrants; or 

        (iii)  there
shall be any reclassification of the outstanding Class A Common Stock or any consolidation or merger to which the Corporation is a party and for which
approval of any stockholders of the Corporation is required, or a statutory share exchange, an issuer or self tender offer shall have been commenced for at least 30% of the outstanding shares of
Class A Common Stock (or an amendment thereto changing the maximum number of shares sought or the amount or type of consideration being offered therefor shall have been adopted), or the sale or
transfer of all or substantially all of the assets of the Corporation as an entirety; or 

        (iv)  there
shall occur the voluntary or involuntary liquidation, dissolution or winding up of the Corporation, then the Corporation shall cause to be filed with the Transfer
Agent and shall cause 

14

 

to
be mailed to each holder of shares of Class W Preferred Stock at such holder's address as shown on the stock records of the Corporation, as promptly as possible, a notice stating
(A) the record date for the payment of such dividend, distribution or rights or warrants, or, if a record date is not established, the date as of which the holders of Class A Common
Stock of record to be entitled to such dividend, distribution or rights or warrants are to be determined or (B) the date on which such reclassification, consolidation, merger, statutory share
exchange, sale, transfer, liquidation, dissolution or winding up is expected to become effective, and the date as of which it is expected that holders of Class A Common Stock of record shall be
entitled to exchange their shares of Class A Common Stock for securities or other property, if any, deliverable upon such reclassification, consolidation, merger, statutory share exchange,
sale, transfer, liquidation, dissolution or winding up or (C) the date on which such tender offer commenced, the date on which such tender offer is scheduled to expire unless extended, the
consideration offered and the other material terms thereof (or the material terms of any amendment thereto). Failure to give or receive such notice or any defect therein shall not affect the legality
or validity of the proceedings described in this Section 7.2. 

        (d)   Whenever
the Conversion Price is adjusted as herein provided, the Corporation shall promptly file with the Transfer Agent an officer's certificate setting forth the
Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment which certificate shall be conclusive evidence of the correctness of such adjustment
absent manifest error. Promptly after delivery of such certificate, the Corporation shall prepare a notice of such adjustment of the Conversion Price setting forth the adjusted Conversion Price and
the effective date such adjustment becomes effective and shall mail such notice of such adjustment of the Conversion Price to each holder of shares of Class W Preferred Stock at such holder's
last address as shown on the stock records of the Corporation. 

        (e)   In
any case in which paragraph (a) of this Section 7.2 provides that an adjustment shall become effective on the day next following the record date
for an event, the Corporation may defer until the occurrence of such event (A) issuing to the holder of any share of Class W Preferred Stock converted after such record date and before
the occurrence of such event the additional Class A Common Stock issuable upon such conversion by reason of the adjustment required by such event over and above the Class A Common Stock
issuable upon such conversion before giving effect to such adjustment and (B) paying to such holder any amount of cash in lieu of any fraction pursuant to paragraph (c) of
Section 7.1. 

        (f)    There
shall be no adjustment of the Conversion Price in case of the issuance of any capital stock of the Corporation in a reorganization, acquisition or other similar
transaction except as specifically set forth in this Section 7.2. 

        (g)   If
the Corporation shall take any action affecting the Class A Common Stock, other than action described in this Section 7.2, that in the opinion of the
Board of Directors would materially adversely affect the conversion rights of the holders of Class W Preferred Stock, the Conversion Price for the Class W Preferred Stock may be
adjusted, to the extent permitted by law, in such manner, if any, and at such time as the Board of Directors, in its sole discretion, may determine to be equitable under the circumstances. 

        (h)   The
Corporation shall at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued Class A Common
Stock solely for the purpose of effecting conversion of the Class W Preferred Stock, the full number of shares of Class A Common Stock deliverable upon the conversion of all outstanding
shares of Class W Preferred Stock not theretofore converted into Class A Common Stock. For purposes of this paragraph (h), the number of shares of Class A Common Stock that
shall be deliverable upon the conversion of all outstanding shares of Class W Preferred Stock shall be computed as if at the time of computation all such 

15

 

outstanding
shares were held by a single holder (and without regard to the Ownership Limit set forth in the Charter of the Corporation). 

        The
Corporation covenants that any shares of Class A Common Stock issued upon conversion of the shares of Class W Preferred Stock shall be validly issued, fully paid and
nonassessable. 

        The
Corporation shall use its best efforts to list the shares of Class A Common Stock required to be delivered upon conversion of the shares of Class W Preferred Stock,
prior to such delivery, upon each national securities exchange, if any, upon which the outstanding shares of Class A Common Stock are listed at the time of such delivery. 

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

        (j)    In
addition to any other adjustment required hereby, to the extent permitted by law, the Corporation from time to time may decrease the Conversion Price by any amount,
permanently or for a period of at least twenty Business Days, if the decrease is irrevocable during the period. 

        (k)   Notwithstanding
anything to the contrary contained in this Section 7.2, conversion of Class W Preferred Stock pursuant to this Section 7.2 shall be
permitted only to the extent that such conversion would not result in a violation of the Ownership Restrictions (as defined in the Charter), after taking into account any waiver of such limitation
granted to any holder of the shares of Class W Preferred Stock. 

8.     Ranking.  

        Any class or series of capital stock of the Corporation shall be deemed to rank: 

        (a)   prior
or senior to the Class W Preferred Stock, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, if
the holders of such class or series shall be entitled to the receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority
to the holders of Class W Preferred Stock ("Senior Stock"); 

        (b)   on
a parity with the Class W Preferred Stock, as to the payment of dividends and as to distribution of assets upon liquidation, dissolution or winding up, whether
or not the dividend rates, dividend payment dates or redemption or liquidation prices per share thereof be different from those of the Class W Preferred Stock, if (i) such capital stock
is Class B Cumulative Convertible Preferred Stock, Class C Cumulative Preferred Stock, Class D Cumulative Preferred Stock, Class G Cumulative Preferred Stock,
Class H Cumulative Preferred Stock, Class I Cumulative Preferred Stock, Class J Cumulative Convertible Preferred Stock, Class K Convertible Cumulative Preferred Stock,
Class L Convertible Cumulative Preferred Stock, Class M Convertible Cumulative Preferred Stock, Class N Convertible Cumulative Preferred Stock, Class O Cumulative
Convertible Preferred Stock, Class P Convertible Cumulative Preferred Stock, Class Q Cumulative Preferred Stock Class R Cumulative Preferred Stock, Class S Cumulative
Redeemable Preferred Stock, Class T Cumulative Preferred Stock, Class U Cumulative Preferred Stock or Class V Cumulative Preferred Stock of the Corporation, or (ii) the
holders of such class of stock or series and the Class W Preferred Stock shall be entitled to the receipt of dividends and of amounts distributable upon liquidation, dissolution or winding up
in 

16

 

proportion
to their respective amounts of accrued and unpaid dividends per share or liquidation preferences, without preference or priority of one over the other (the capital stock referred to in
clauses (i) and (ii) of this paragraph being hereinafter referred to, collectively, as "Parity Stock"); and 

        (c)   junior
to the Class W Preferred Stock, as to the payment of dividends and as to the distribution of assets upon liquidation, dissolution or winding up, if
(i) such capital stock or series shall be Class A Common Stock or (ii) the holders of Class W Preferred Stock shall be entitled to receipt of dividends or of amounts
distributable upon liquidation, dissolution or winding up, as the case may be, in preference or priority to the holders of shares of such class or series (the capital stock referred to in clauses
(i) and (ii) of this paragraph being hereinafter referred to, collectively, as "Junior Stock"). 

9.     Voting.  

        (a)   If
and whenever either (i) for two consecutive quarterly dividend periods the Corporation fails to pay dividends on the Class A Common Stock in an amount
per share at least equal to Forty-five Cents ($0.45) (subject to adjustment consistent with any adjustment of the Conversion Price pursuant to Section 7.2 of this Article) (the
"Base Common Stock Dividend"), or (ii) the Corporation fails to pay a quarterly dividend payable on the Class W Preferred Stock, whether or not earned or declared, then the number of
directors then constituting the Board of Directors shall be increased by one additional director and the holders of shares of Class W Preferred Stock shall be entitled to elect the additional
director to serve on the Board of Directors at any annual meeting of stockholders or special meeting held in place thereof, or at a special meeting of the holders of the Class W Preferred Stock
called as hereinafter provided. Whenever (1) in the case of clause (i), the Corporation makes a quarterly dividend payment on the Class A Common Stock in an amount per share equal
to or exceeding the Base Common Stock Dividend, or (2) in the case of an arrearage in dividends described in clause (ii), all arrears in dividends on the Class W Preferred Stock
then outstanding shall have been paid and dividends thereon for the current quarterly dividend period shall have been declared and paid, or declared and set apart for payment, then the right of the
holders of the Class W Preferred Stock to elect such additional director shall cease (but subject always to the same provision for the vesting of such voting rights in the case of any similar
future events), and the term of office of the person elected as a director by the holders of the Class W Preferred Stock shall forthwith terminate and the number of directors constituting the
Board of Directors shall be reduced accordingly. At any time after such voting power shall have been so vested in the holders of Class W Preferred Stock, the Secretary of the Corporation may,
and upon the written request of any holder of Class W Preferred Stock (addressed to the Secretary at the principal office of the Corporation) shall, call a special meeting of the holders of the
Class W Preferred Stock for the election of the director to be elected by them as herein provided, such call to be made by notice similar to that provided in the Bylaws of the Corporation for a
special meeting of the stockholders or as required by law. If any such special meeting required to be called as above provided shall not be called by the Secretary within 20 days after receipt
of any such request, then any holder of Class W Preferred Stock may call such meeting, upon the notice above provided, and for that purpose shall have access to the stock books of the
Corporation. The director elected at any such special meeting shall hold office until the next annual meeting of the stockholders or special meeting held in lieu thereof if such office shall not have
previously terminated as above provided. If any vacancy shall occur in the director elected by the holders of the Class W Preferred Stock, a successor shall be elected by the Board of
Directors, upon the nomination of the holders of the Class W Preferred Stock, to serve until the next annual meeting of the stockholders or special meeting held in place thereof if such office
shall not have previously terminated as provided above. 

        (b)   If
and whenever six quarterly dividends (whether or not consecutive) payable on the Class W Preferred Stock or any series or class of Parity Stock shall be in
arrears (which shall, with respect to any such quarterly dividend, mean that any such dividend has not been paid in full), whether or not earned or declared, then the number of directors then
constituting the Board of Directors shall be 

17

 

increased
by two directors (if not already increased by reason of similar types of provisions with respect to shares of any other class or series of Parity Stock which is entitled to similar voting
rights (the "Voting Preferred Stock")) and the holders of shares of Class W Preferred Stock, together with the holders of shares of all other Voting Preferred Stock then entitled to exercise
similar voting rights, voting as a single class regardless of series, shall be entitled to elect the two additional directors to serve on the Board of Directors at any annual meeting of stockholders
or special meeting held in place thereof, or at a special meeting of the holders of the Class W Preferred Stock and the Voting Preferred Stock called as hereinafter provided. Whenever all
arrears in dividends on the Class W Preferred Stock and the Voting Preferred Stock then outstanding shall have been paid and dividends thereon for the current quarterly dividend period shall
have been declared and paid, or declared and set apart for payment, then the right of the holders of the Class W Preferred Stock and the Voting Preferred Stock to elect such additional two
directors shall cease (but subject always to the same provision for the vesting of such voting rights in the case of any similar future arrearages), and the terms of office of all persons elected as
directors by the holders of the Class W Preferred Stock and the Voting Preferred Stock shall forthwith terminate and the number of directors constituting the Board of Directors shall be reduced
accordingly. At any time after such voting power shall have been so vested in the holders of Class W Preferred Stock and the Voting Preferred Stock, if applicable, the Secretary of the
Corporation may, and upon the written request of any holder of Class W Preferred Stock (addressed to the Secretary at the principal office of the Corporation) shall, call a special meeting of
the holders of the Class W Preferred Stock and of the Voting Preferred Stock for the election of the two directors to be elected by them as herein provided, such call to be made by notice
similar to that provided in the Bylaws of the Corporation for a special meeting of the stockholders or as required by law. If any such special meeting required to be called as above provided shall not
be called by the Secretary within 20 days after receipt of any such request, then any holder of Class W Preferred Stock may call such meeting, upon the notice above provided, and for
that purpose shall have access to the stock books of the Corporation. The directors elected at any such special meeting shall hold office until the next annual meeting of the stockholders or special
meeting held in lieu thereof if such office shall not have previously terminated as above provided. If any vacancy shall occur among the directors elected by the holders of the Class W
Preferred Stock and the Voting Preferred Stock, a successor shall be elected by the Board of Directors, upon the nomination of the then-remaining director elected by the holders of the
Class W Preferred Stock and the Voting Preferred Stock or the successor of such remaining director, to serve until the next annual meeting of the stockholders or special meeting held in place
thereof if such office shall not have previously terminated as provided above. 

        (c)   So
long as any shares of Class W Preferred Stock are outstanding, in addition to any other vote or consent of stockholders required by law or by the Charter of
the Corporation, the affirmative vote of at least 662/3% of the votes entitled to be cast by the holders of the Class W Preferred Stock, voting as a single class, given in person
or by proxy, either in writing without a meeting or by vote at any meeting called for the purpose, shall be necessary for effecting or validating: 

        (i)    any
amendment, alteration or repeal of any of the provisions of, or the addition of any provision to, these Articles Supplementary, the Charter or the
By-Laws of the Corporation that materially adversely affects the voting powers, rights or preferences of the holders of the Class W Preferred Stock (including any amendment,
alteration or repeal effected pursuant to a merger, consolidation or similar transaction) or would convert the Class W Preferred Stock into cash or any other security other than a preferred
stock with terms and provisions equivalent to those set forth in these Articles Supplementary; provided, however, that the amendment of the provisions
of the Charter so as to authorize or create, or to increase the authorized amount of, or issue any Junior Stock or any shares of any class of Parity Stock shall not be deemed to materially adversely
affect the voting powers, rights or preferences of the holders of Class W Preferred Stock; or 

18

 

        (ii)   the
authorization, creation of, increase in the authorized amount of, or issuance of any shares of any class or series of Senior Stock or any security convertible into
shares of any class or series of Senior Stock (whether or not such class or series of Senior Stock is currently authorized); 

provided, however, that no such vote of the holders of Class W Preferred Stock shall be required if, at or prior to the time when such amendment,
alteration or repeal is to take effect, or when the issuance of any such Senior Stock or convertible or exchangeable security is to be made, as the case may be, provision is made for the redemption of
all shares of Class W Preferred Stock at the time outstanding to the extent such redemption is authorized by Section 5 of this Article. 

        For
purposes of the foregoing provisions and all other voting rights under these Articles Supplementary, each share of Class W Preferred Stock shall have one (1) vote per
share, except that when any other class or series of preferred stock of the Corporation shall have the right to vote with the Class W Preferred Stock as a single class on any matter, then the
Class W Preferred Stock and such other class or series shall have with respect to such matters one quarter of one vote per $25 of stated liquidation preference. Except as otherwise required by
applicable law or as set forth herein or in the Charter, the Class W Preferred Stock shall not have any relative, participating, optional or other special voting rights and powers other than as
set forth herein, and the consent of the holders thereof shall not be required for the taking of any corporate action. 

10.   Record Holders.  

        The Corporation and the Transfer Agent may deem and treat the record holder of any share of Class W Preferred Stock as the true and lawful owner thereof
for all purposes, and neither the Corporation nor the Transfer Agent shall be affected by any notice to the contrary. 

        10.1 Restrictions on Ownership and Transfers.

        (a)   Limitation on Beneficial Ownership. Except as provided in Section 10.8, from and after the Issue Date, no Person
(other than the Initial Holder or a Look-Through Entity) shall Beneficially Own shares of Class W Preferred Stock in excess of the Ownership Limit, the Initial Holder shall not
Beneficially Own shares of Class W Preferred Stock in excess of the Initial Holder Limit and no Look-Through Entity shall Beneficially Own shares of Class W Preferred Stock
in excess of the Look-Through Ownership Limit. 

        (b)   Transfers in Excess of Ownership Limit. Except as provided in Section 10.8, from and after the Issue Date (and
subject to Section 10.12), any Transfer (whether or not such Transfer is the result of transactions entered into through the facilities of the NYSE or other securities exchange or an automated
inter-dealer quotation system) that, if effective, would result in any Person (other than the Initial Holder or a Look-Through Entity) Beneficially Owning shares of Class W
Preferred Stock in excess of the Ownership Limit shall be void ab initio as to the Transfer of such shares of Class W Preferred Stock that would
be otherwise Beneficially Owned by such Person in excess of the Ownership Limit, and the intended transferee shall acquire no rights in such shares of Class W Preferred Stock. 

        (c)   Transfers in Excess of Initial Holder Limit. Except as provided in Section 10.8, from and after the Issue Date
(and subject to Section 10.12), any Transfer (whether or not such Transfer is the result of transactions entered into through the facilities of the NYSE or other securities exchange or an
automated inter-dealer quotation system) that, if effective, would result in the Initial Holder Beneficially Owning shares of Class W Preferred Stock in excess of the Initial Holder Limit shall
be void ab initio as to the Transfer of such shares of Class W Preferred Stock that would be otherwise Beneficially Owned by the Initial Holder
in excess of the Initial Holder limit, and the Initial Holder shall acquire no rights in such shares of Class W Preferred Stock. 

        (d)   Transfers in Excess of Look-Through Ownership Limit.Except as provided in Section 10.8 from and after
the Issue Date (and subject to Section 10.12), any Transfer (whether or not such 

19

 

Transfer
is the result of transactions entered into through the facilities of the NYSE or other securities exchange or an automated inter-dealer quotation system) that, if effective, would result in
any Look-Through Entity Beneficially Owning shares of Class W Preferred Stock in excess of the Look-Through Ownership limit shall be void ab
initio as to the Transfer of such shares of Class W Preferred Stock that would be otherwise Beneficially Owned by such Look-Through Entity in excess of the
Look-Through Ownership Limit and such Look-Through Entity shall acquire no rights in such shares of Class W Preferred Stock. 

        (e)   Transfers Resulting in "Closely Held" Status. From and after the Issue Date, any Transfer that, if effective would result
in the Corporation being "closely held" within the meaning of Section 856(h) of the Code, or would otherwise result in the Corporation failing to qualify as a REIT (including, without
limitation, a Transfer or other event that would result in the Corporation owning (directly or constructively) an interest in a tenant that is described in Section 856(d)(2)(B) of the
Code if the income derived by the Corporation from such tenant would cause the Corporation to fail to satisfy any of the gross income requirements of Section 856(c) of the Code) shall be
void ab initio as to the Transfer of shares of Class W Preferred Stock that would cause the Corporation (i) to be "closely held" within
the meaning of Section 856(h) of the Code or (ii) otherwise fail to qualify as a REIT, as the case may be, and the intended transferee shall acquire no rights in such shares of
Class W Preferred Stock. 

        (f)    Severability on Void Transactions. A Transfer of a share of Class W Preferred Stock that is null and void under
Sections 10.1(b), (c), (d), or (e) of this Article because it would, if effective, result in (i) the ownership of Class W Preferred Stock in excess of the Initial
Holder Limit, the Ownership Limit, or the Look-Through Ownership Limit, (ii) the Corporation being "closely held" within the meaning of Section 856(h) of the Code or
(iii) the Corporation otherwise failing to qualify as a REIT, shall not adversely affect the validity of the Transfer of any other share of Class W Preferred Stock in the same or any
other related transaction. 

        10.2 Remedies for Breach. If the Board of Directors or a committee thereof shall at any time determine in good faith that a
Transfer or other event has taken place in violation of Section 10.1 of this Article or that a Person intends to acquire or has attempted to acquire Beneficial Ownership of any shares of
Class W Preferred Stock in violation of Section 10.1 of this Article (whether or not such violation is intended), the Board of Directors or a committee thereof shall be empowered
to take any action as it deems advisable to refuse to give effect to or to prevent such Transfer or other event, including, but not limited to, refusing to give effect to such Transfer or other event
on the books of the Corporation, causing the Corporation to redeem such shares at the then current Market Price and upon such terms and conditions as may be specified by the Board of Directors in its
sole discretion (including, but not limited to, by means of the issuance of long-term indebtedness for the purpose of such redemption), demanding the repayment of any distributions
received in respect of shares of Class W Preferred Stock acquired in violation of Section 10.1 of this Article or instituting proceedings to enjoin such Transfer or to rescind
such Transfer or attempted Transfer; provided, however, that any Transfers or attempted Transfers (or in the case of events other than a Transfer,
Beneficial Ownership) in violation of Section 10.1 of this Article, regardless of any action (or non-action) by the Board of Directors or such committee, (a) shall be void  ab initio or
(b) shall automatically result in the transfer described in Section 10.3 of this Article; provided,
further, that the provisions of this Section 10.2 shall be subject to the provisions of Section 10.12 of this Article; provided,
further, that neither the Board of Directors nor any committee thereof may exercise such authority in a manner that interferes with any ownership or transfer of Class W
Preferred Stock that is expressly authorized pursuant to Section 10.8(c) of this Article. 

20

 

        10.3 Transfer in Trust.

        (a)   Establishment of Trust. If, notwithstanding the other provisions contained in this Article, at any time after the Issue
Date there is a purported Transfer (an "Excess Transfer") (whether or not such Transfer is the result of transactions entered into through the
facilities of the NYSE or other securities exchange or an automated inter-dealer quotation system) or other change in the capital structure of the Corporation (including, but not limited to, any
redemption of Equity Stock) or other event (including, but not limited to, any acquisition of any share of Equity Stock) such that (a) any Person (other than the Initial Holder or a
Look-Through Entity) would Beneficially Own shares of Class W Preferred Stock in excess of the Ownership Limit, or (b) the Initial Holder would Beneficially Own shares of
Class W Preferred Stock in excess of the Initial Holder Limit, or (c) any Person that is a Look-Through Entity would Beneficially Own shares of Class W Preferred Stock
in excess of the Look-Through Ownership Limit (in any such event, the Person, Initial Holder or Look-Through Entity that would Beneficially Own shares of Class W
Preferred Stock in excess of the Ownership Limit, the Initial Holder Limit or the Look-Through Entity Limit, respectively, is referred to as a "Prohibited
Transferee"), then, except as otherwise provided in Section 10.8 of this Article, such shares of Class W Preferred Stock in excess of the Ownership Limit, the
Initial Holder Limit or the Look-Through Ownership Limit, as the case may be, (rounded up to the nearest whole share) shall be automatically transferred to a Trustee in his capacity as
trustee of a Trust for the exclusive benefit of one or more Charitable Beneficiaries. Such transfer to the Trustee shall be deemed to be effective as of the close of business on the Business Day prior
to the Excess Transfer, change in capital structure or another event giving rise to a potential violation of the Ownership Limit, the Initial Holder Limit or the Look Through Entity Ownership Limit. 

        (b)   Appointment of Trustee. The Trustee shall be appointed by the Corporation and shall be a Person unaffiliated with either
the Corporation or any Prohibited Transferee. The Trustee may be an individual or a bank or trust company duly licensed to conduct a trust business. 

        (c)   Status of Shares Held by the Trustee. Shares of Class W Preferred Stock held by the Trustee shall be issued and
outstanding shares of capital stock of the Corporation. Except to the extent provided in Section 10.3(e), the Prohibited Transferee shall have no rights in the Class W Preferred Stock
held by the Trustee, and the Prohibited Transferee shall not benefit economically from ownership of any shares held in trust by the Trustee, shall have no rights to dividends and shall not possess any
rights to vote or other rights attributable to the shares held in the Trust. 

        (d)   Dividend and Voting Rights. The Trustee shall have all voting rights and rights to dividends with respect to shares of
Class W Preferred Stock held in the Trust, which rights shall be exercised for the benefit of the Charitable Beneficiary. Any dividend or distribution paid prior to the discovery by the
Corporation that the shares of Class W Preferred Stock have been transferred to the Trustee shall be repaid to the Corporation upon demand, and any dividend or distribution declared but unpaid
shall be rescinded as void ab initio with respect to such shares of Class W Preferred Stock. Any dividends or distributions so disgorged or
rescinded shall be paid over to the Trustee and held in trust for the Charitable Beneficiary. Any vote cast by a Prohibited Transferee prior to the discovery by the Corporation that the shares of
Class W Preferred Stock have been transferred to the Trustee will be rescinded as void ab initio and shall be recast in accordance with the
desires of the Trustee acting for the benefit of the Charitable Beneficiary. The owner of the shares at the time of the Excess Transfer, change in capital structure or other event giving rise to a
potential violation of the Ownership Limit, Initial Holder Limit or Look-Through Entity Ownership Limit shall be deemed to have given an irrevocable proxy to the Trustee to vote the shares
of Class W Preferred Stock for the benefit of the Charitable Beneficiary. 

        (e)   Restrictions on Transfer. The Trustee of the Trust may sell the shares held in the Trust to a Person, designated by the
Trustee, whose ownership of the shares will not violate the Ownership 

21

 

Restrictions.
If such a sale is made, the interest of the Charitable Beneficiary shall terminate and proceeds of the sale shall be payable to the Prohibited Transferee and to the Charitable
Beneficiary as provided in this Section 10.3(e). The Prohibited Transferee shall receive the lesser of (1) the price paid by the Prohibited Transferee for the shares or, if the
Prohibited Transferee did not give value for the shares (through a gift, devise or other transaction), the Market Price of the shares on the day of the event causing the shares to be held in the Trust
and (2) the price per share received by the Trustee from the sale or other disposition of the shares held in the Trust. Any proceeds in excess of the amount payable to the Prohibited Transferee
shall be payable to the Charitable Beneficiary. If any of the transfer restrictions set forth in this Section 10.3(e) or any application thereof is determined in a final judgment to be void,
invalid or unenforceable by any court having jurisdiction over the issue, the Prohibited Transferee may be deemed, at the option of the Corporation, to have acted as the agent of the Corporation in
acquiring the Class W Preferred Stock as to which such restrictions would, by their terms, apply, and to hold such Class W Preferred Stock on behalf of the Corporation. 

        (f)    Purchase Right in Stock Transferred to the Trustee. Shares of Class W Preferred Stock transferred to the Trustee
shall be deemed to have been offered for sale to the Corporation, or its designee, at a price per share equal to the lesser of (i) the price per share in the transaction that resulted in such
transfer to the Trust (or, in the case of a devise or gift, the Market Price at the time of such devise or gift) and (ii) the Market Price on the date the Corporation, or its designee, accepts
such offer. The Corporation shall have the right to accept such offer for a period of 90 days after the later of (i) the date of the Excess Transfer or other event resulting in a
transfer to the Trust and (ii) the date that the Board of Directors determines in good faith that an Excess Transfer or other event occurred. 

        (g)   Designation of Charitable Beneficiaries. By written notice to the Trustee, the Corporation shall designate one or more
nonprofit organizations to be the Charitable Beneficiary of the interest in the Trust relating to such Prohibited Transferee if (i) the shares of Class W Preferred Stock held in the
Trust would not violate the Ownership Restrictions in the hands of such Charitable Beneficiary and (ii) each Charitable Beneficiary is an organization described in Sections 170(b)(1)(A),
170(c)(2) and 501(c)(3) of the Code. 

        10.4 Notice of Restricted Transfer. Any Person that acquires or attempts to acquire shares of Class W Preferred Stock
in violation of Section 10.1 of this Article, or any Person that is a Prohibited Transferee such that stock is transferred to the Trustee under Section 10.3 of this Article, shall
immediately give written notice to the Corporation of such event and shall provide to the Corporation such other information as the Corporation may request in order to determine the effect, if any, of
such Transfer or attempted Transfer or other event on the Corporation's status as a REIT. Failure to give such notice shall not limit the rights and remedies of the Board of Directors provided herein
in any way. 

        10.5 Owners Required to Provide Information. From and after the Issue Date certain record and Beneficial Owners and
transferees of shares of Class W Preferred Stock will be required to provide certain information as set out below. 

        (a)   Annual Disclosure. Every record holder or Beneficial Owner of shares of Class W Preferred Stock convertible into
more than 5% (or such other percentage between 0.5% and 5%, as provided in the applicable regulations adopted under the Code) of the number of Outstanding shares of Equity Stock shall upon written
request by the Corporation, such request to be made within 30 days after January 1 of each year, give written notice to the Corporation stating the name and address of such record holder
or Beneficial Owner, the number of shares of Class W Preferred Stock Beneficially Owned, and a full description of how such shares are held. Each such record holder or Beneficial Owner of
Class W Preferred Stock shall, upon demand by the Corporation, disclose to the Corporation in writing such additional information with respect to the Beneficial Ownership of the Class W
Preferred Stock as the Board of Directors, in its sole discretion, deems appropriate or necessary to 

22

 

(i) comply
with the provisions of the Code regarding the qualification of the Corporation as a REIT under the Code and (ii) ensure compliance with the Ownership Limit, the Initial Holder
Limit or the Look-Through Ownership Limit, as applicable. Each stockholder of record, including without limitation any Person that holds shares of Class W Preferred Stock on behalf
of a Beneficial Owner, shall take all reasonable steps to obtain the written notice described in this Section 10.5 from the Beneficial Owner. 

        (b)   Disclosure at the Request of the Corporation. Any Person that is a Beneficial Owner of shares of Class W Preferred
Stock and any Person (including the stockholder of record) that is holding shares of Class W Preferred Stock for a Beneficial Owner, and any proposed transferee of shares, shall provide such
information as the Corporation, in its sole discretion, may request in order to determine the Corporation's status as a REIT, to comply with the requirements of any taxing authority or other
governmental agency, to determine any such compliance or to ensure compliance with the Ownership Limit, the Initial Holder Limit and the Look-Through Ownership Limit, and shall provide a
statement or affidavit to the Corporation setting forth the number of shares of Class W Preferred Stock already Beneficially Owned by such stockholder or proposed transferee and any related
persons specified, which statement or affidavit shall be in the form prescribed by the Corporation for that purpose. 

        10.6 Remedies Not Limited. Nothing contained in this Article shall limit the authority of the Board of Directors to
take such other action as it deems necessary or advisable (subject to the provisions of Section 10.12 of this Article) (i) to protect the Corporation and the interests of its
stockholders in the preservation of the Corporation's status as a REIT and (ii) to insure compliance with the Ownership Limit, the Initial Holder Limit and the Look-Through
Ownership Limit. 

        10.7 Ambiguity. In the case of an ambiguity in the application of any of the provisions of Section 10 of this Article,
or in the case of an ambiguity in any definition contained in Section 10 of this Article, the Board of Directors shall have the power to determine the application of the provisions of this
Article with respect to any situation based on its reasonable belief, understanding or knowledge of the circumstances. 

        10.8 Exceptions. The following exceptions shall apply or may be established with respect to the limitations of
Section 10.1 of this Article. 

        (a)   Waiver of Ownership Limit. The Board of Directors, upon receipt of a ruling from the Internal Revenue Service or an
opinion of tax counsel or other evidence or undertaking acceptable to it, may waive the application, in whole or in part, of the Ownership Limit to a Person subject to the Ownership Limit, if such
person is not an individual for purposes of Section 542(a) of the Code (as modified to exclude qualified trusts from treatment as individuals pursuant to
Section 856(h)(3) of the Code) and is a corporation, partnership, limited liability company, estate or trust. In connection with any such exemption, the Board of Directors may require
such representations and undertakings from such Person and may impose such other conditions as the Board of Directors deems necessary, in its sole discretion, to determine the effect, if any, of the
proposed Transfer on the Corporation's status as a REIT. 

        (b)   Pledge by Initial Holder. Notwithstanding any other provision of this Article, the pledge by the Initial Holder of all or
any portion of the Class W Preferred Stock directly owned at any time or from time to time shall not constitute a violation of Section 10.1 of this Article and the pledgee shall
not be subject to the Ownership Limit with respect to the Class W Preferred Stock so pledged to it either as a result of the pledge or upon foreclosure. 

        (c)   Underwriters. For a period of 270 days (or such longer period of time as any underwriter described below shall
hold an unsold allotment of Class W Preferred Stock) following the purchase of Class W Preferred Stock by an underwriter that (i) is a corporation, partnership or other legal
entity and (ii) participates in an offering of the Class W Preferred Stock, such underwriter shall not be subject to the Ownership Limit with respect to the Class W Preferred
Stock purchased by it as a part 

23

 

of
or in connection with such offering and with respect to any Class W Preferred Stock purchased in connection with market making activities. 

        10.9 Legend. Each certificate for Class W Preferred Stock shall bear substantially the following legend: 

"The
shares of Class W Cumulative Convertible Preferred Stock represented by this certificate are subject to restrictions on transfer. No person may Beneficially Own shares of Class W
Cumulative Convertible Preferred Stock in excess of the Ownership Restrictions, as applicable, with certain further restrictions and exceptions set forth in the Charter (including the Articles
Supplementary setting forth the terms of the Class W Cumulative Convertible Preferred Stock). Any Person that attempts to Beneficially Own shares of Class W Cumulative Convertible
Preferred Stock in excess of the applicable limitation must immediately notify the Corporation. All capitalized terms in this legend have the meanings ascribed to such terms in the Charter (including
the Articles Supplementary setting forth the terms of the Class W Cumulative Convertible Preferred Stock), as the same may be amended from time to time, a copy of which, including the
restrictions on transfer, will be sent without charge to each stockholder that so requests. If the restrictions on transfer are violated, (i) the transfer of the shares of Class W
Cumulative Convertible Preferred Stock represented hereby will be void in accordance with the Charter (including the Articles Supplementary setting forth the terms of the Class W Cumulative
Convertible Preferred Stock) or (ii) the shares of Class W Cumulative Convertible Preferred Stock represented hereby will automatically be transferred to a Trustee of a Trust for the
benefit of one or more Charitable Beneficiaries." 

        10.10   Severability. If any provision of this Article or any application of any such provision is
determined in a final and unappealable judgment to be void, invalid or unenforceable by any Federal or state court having jurisdiction over the issues, the validity and enforceability of the remaining
provisions shall not be affected and other applications of such provision shall be affected only to the extent necessary to comply with the determination of such court. 

        10.11   Board of Directors Discretion. Anything in this Article to the contrary notwithstanding, the Board
of Directors shall be entitled to take or omit to take such actions as it in its discretion shall determine to be advisable in order that the Corporation maintain its status as and continue to qualify
as a REIT, including, but not limited to, reducing the Ownership Limit, the Initial Holder Limit and the Look-Through Ownership Limit in the event of a change in law. 

        10.12   Settlement. Nothing in this Section 10 of this Article shall be interpreted to preclude the
settlement of any transaction entered into through the facilities of the NYSE or other securities exchange or an automated inter-dealer quotation system. 

        FOURTH:    The terms of the Class W Cumulative Convertible Preferred Stock set forth in Article Third hereof shall
become Article XXXIV of the Charter. 

24

 

        IN
WITNESS WHEREOF, the Corporation has caused these presents to be signed in its name and on its behalf by its Executive Vice President and Chief Financial Officer and witnessed by its
Assistant Secretary on September 24, 2004. 

	WITNESS:	 	APARTMENT INVESTMENT AND MANAGEMENT COMPANY
	

/s/  LISA COHN      
 Lisa Cohn

Assistant Secretary	
 	

/s/  PAUL J. MCAULIFFE      
 Paul J. McAuliffe

Executive Vice President and Chief Financial Officer

        THE
UNDERSIGNED, Executive Vice President and Chief Financial Officer of APARTMENT INVESTMENT AND MANAGEMENT COMPANY, who executed on behalf of the Corporation the Articles Supplementary
of which this Certificate is made a part, hereby acknowledges in the name and on behalf of said Corporation the foregoing Articles Supplementary to be the corporate act of said Corporation and hereby
certifies that the matters and facts set forth herein with respect to the authorization and approval thereof are true in all material respects under the penalties of perjury. 

	
 	
 	

/s/  PAUL J. MCAULIFFE      
 Paul J. McAuliffe

Executive Vice President and Chief Financial Officer

25

QuickLinks

ARTICLES SUPPLEMENTARY APARTMENT INVESTMENT AND MANAGEMENT COMPANY Class W Cumulative Convertible Preferred Stock (Par Value $.01 Per Share)

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