Document:

exv4w2

 

Exhibit 4.2

     FIRST SUPPLEMENTAL INDENTURE, dated as of February 2, 1994, by and among PROPERTY TRUST
OF AMERICA, a real estate investment trust organized under the laws of the State of Maryland having
its principal office at 1790 Commerce Park Drive, El Paso, Texas 79912 (hereinafter sometimes
called the “Company”), MORGAN GUARANTY TRUST COMPANY OF NEW YORK, a banking corporation organized
under the laws of the State of New York having its principal corporate trust office at 60 Wall
Street, New York, New York 10260, as Trustee under the Indenture (as hereinafter defined) (the
“Resigning Trustee”), and STATE STREET BANK AND TRUST COMPANY, a Massachusetts banking corporation
having its principal corporate trust office at 225 Franklin Street, Boston, Massachusetts 02110, as
successor Trustee under the Indenture (the “Successor Trustee”).

RECITALS OF THE COMPANY

     The Company and the Resigning Trustee have heretofore entered into an Indenture dated as of
February 1, 1994 (hereinafter called the “Indenture”) between the Company and the Resigning
Trustee, providing for the issuance by the Company from time to time of its senior debt securities
evidencing its unsecured and unsubordinated indebtedness (the “Securities”).

     No Securities have been issued under the Indenture.

     The Company desires to appoint the Successor Trustee to succeed the Resigning Trustee as
Trustee under the Indenture.

     In accordance with Sections 901(8) and 901(9) of the Indenture, this First Supplemental
Indenture to the Indenture evidences and provides for the acceptance of appointment under the
Indenture by a successor Trustee with respect to the Securities and makes other changes to the
Indenture which do not adversely affect the interests of the Holders (as defined in the Indenture)
of Securities of any series.

     All things necessary to make the Indenture, as hereby modified, a valid agreement of the
Company, in accordance with its terms, have been done.

     NOW, THEREFORE, THIS FIRST SUPPLEMENTAL INDENTURE WITNESSETH:

     For and in consideration of the premises and of the covenants contained in the Indenture, the
Company, the Resigning Trustee and the Successor Trustee covenant and agree, for the equal and
proportionate benefit of all Holders of Securities, as follows:

ARTICLE ONE

THE RESIGNING TRUSTEE

     1.01. Pursuant to Section 608 of the Indenture, with respect to all Securities, at the request
of the Company, the Resigning Trustee hereby resigns as Trustee under the Indenture, and hereby
gives written notice thereof to the Company. The Company hereby accepts the foregoing sentence as
such written notice.

 

 

     1.02. The Resigning Trustee hereby transfers to the Successor Trustee all the rights, powers,
trusts and duties of the Resigning Trustee under the Indenture. The Resigning Trustee shall
execute and deliver such further instruments and shall do such other things as the Successor
Trustee may reasonably require so as to more fully and certainly vest and confirm in the Successor
Trustee all the rights, powers, trusts and duties hereby transferred to the Successor Trustee. The
Company, the Resigning Trustee and the Successor Trustee agree that the Resigning Trustee has never
held any property or money under the Indenture.

ARTICLE TWO

THE COMPANY

     2.01. The Secretary of the Company, by attesting to the execution of this First Supplemental
Indenture, hereby certifies that annexed hereto as Exhibit A is a copy of the Board Resolution duly
adopted by the Board of Trustees and by the Pricing Committee of the Board of Trustees of the
Company, and in full force and effect on the date hereof authorizing certain officers of the
Company (one of whom executed this First Supplemental Indenture on behalf of the Company) to, among
other things: (a) appoint the Successor Trustee as Trustee under the Indenture; and (b) execute and
deliver such agreements and other instruments (including this First Supplemental Indenture) as may
be necessary or desirable to effectuate the succession of the Successor Trustee as Trustee under
the Indenture.

     2.02. The Company hereby appoints the Successor Trustee as successor Trustee under the
Indenture with respect to all Securities and confirms to the Successor Trustee all the rights,
powers, trusts and duties of the Resigning Trustee.

ARTICLE THREE

THE SUCCESSOR TRUSTEE

     3.01. The Successor Trustee hereby represents and warrants to the Resigning Trustee and to the
Company that the Successor Trustee is qualified and eligible under the provisions of Section 607 of
the Indenture and of the Trust Indenture Act of 1939, as amended, to become Trustee under the
Indenture with respect to all Securities.

     3.02. The Successor Trustee hereby accepts its appointment as successor Trustee under the
Indenture with respect to all Securities and is hereby vested with all the rights, powers, trusts
and duties of the Resigning Trustee under the Indenture. The Resigning Trustee and the Company
agree with the Successor Trustee that the foregoing sentence is an instrument acknowledging such
acceptance effective under Section 609(a) of the Indenture upon execution, acknowledgment and
delivery hereof by the Successor Trustee.

ARTICLE FOUR

AMENDMENT OF THE INDENTURE

     4.01. Section 101 of the Indenture is hereby amended by deleting the definition therein of
“Corporate Trust Office” and inserting in lieu thereof the following:

 

 

     “‘Corporate Trust Office’ means the office of the Trustee at which, at any particular
time, its corporate trust business shall be principally administered, which office at the
date hereof is located at 225 Franklin Street, Boston, Massachusetts 02110.”

     4.02. Section 202 of the Indenture is hereby amended by deleting the form of Certificate of
Authentication of the Trustee set forth therein and inserting in lieu thereof the following:

     “This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.

	 	 	 	 	 
	 	STATE STREET BANK AND TRUST 
COMPANY, as Trustee

 	 
	 	By  	 	 
	 	 	Authorized Officer” 	 
	 	 	 	 

     4.03. Section 611 of the Indenture is hereby amended by deleting the alternate form of
Certificate of Authentication which appears as part of the sixth paragraph thereof and inserting in
lieu thereof the following:

     “This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.

	 	 	 	 	 
	 	STATE STREET BANK AND TRUST

COMPANY, as Trustee

 	 
	 	By  	      
 	,
	 	 	As Authenticating Agent 	 
	 	 	 	 
	 	 	 
	 	By  	
 	 
	 	 	Authorized Officer” 	 
	 	 	 	 

 

 

	 	 	 	 	 

ARTICLE FIVE

MISCELLANEOUS PROVISIONS

     5.01. All capitalized terms which are used herein and not otherwise defined herein are defined
in the Indenture and are used herein with the same meanings as in the Indenture.

     5.02. This First Supplemental Indenture and the resignation, appointment and acceptance
effected hereby shall be effective as of the opening of business on the date first above written
upon the execution and delivery hereof by each of the parties hereto.

     5.03. Notwithstanding the resignation of the Resigning Trustee, the Company shall remain
obligated under Section 606 of the Indenture to compensate, reimburse and indemnify the Resigning
Trustee in connection with its trusteeship under the Indenture.

     5.04. Unless otherwise specified with respect to any Securities pursuant to Section 301 with
respect to a series of Securities, the Company hereby designates as a Place of Payment for each
series of Securities the office or agency of the Company in the city of Boston, Massachusetts and
appoints the Successor Trustee as Trustee under the Indenture at its Corporate Trust Office as
Paying Agent in such city and as its agent to receive all such presentations, surrenders, notices
and demands.

     5.05. Except as expressly amended hereby, the Indenture shall continue in full force and
effect in accordance with the provisions thereof and the Indenture is in all respects hereby
ratified and confirmed. This First Supplemental Indenture and all its provisions shall be deemed a
part of the Indenture in the manner and to the extent herein and therein provided.

     5.06. This First Supplemental Indenture shall be governed by, and construed in accordance
with, the laws of the State of New York.

     5.07. This First Supplemental Indenture may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.

     5.08. Neither the Resigning Trustee nor the Successor Trustee shall have any responsibility
for the Recitals of the Company hereto, which Recitals are made by the Company alone, or for the
validity or sufficiency of this First Supplement Indenture.

 

 

          IN WITNESS WHEREOF, the parties hereto have caused this First Supplemental Indenture to be
duly executed and their respective corporate seals to be hereunto affixed and attested, all as of
the day and year first above written.

	 	 	 	 	 
	 	PROPERTY TRUST OF AMERICA

 	 
	 	By:  	 	 
	 	 	C. Ronald Blankenship 	 
	 	 	Chairman and Principal Executive Officer 	 

[SEAL]

Attest:

	 	 	 	 	 
	By:  	 	 
	 	Paul E. Szurek 	 
	 	Secretary 	 

	 	 	 	 	 
	 	STATE STREET BANK AND TRUST COMPANY

 	 
	 	By:  	 	 
	 	 	Philip M. Crimmins 	 
	 	 	Vice President 	 

[SEAL]

Attest:

	 	 	 	 	 
	By:  	
 	 
	 	 	 	 
	 	 	 	 

	 	 	 	 	 
	 	MORGAN GUARANTY TRUST COMPANY OF NEW YORK

 	 
	 	By:  	
 	 
	 	 	Ward Spooner 	 
	 	 	Vice President 	 

[SEAL]

Attest:

	 	 	 	 	 
	By:  	
 	 
	 	Cheryl Petti 	 
	 	Assistant Secretary 	 

 

 

	 	 	 	 	 

ACKNOWLEDGMENT

STATE OF NEW MEXICO    )

                                                          )    SS.

COUNTY OF SANTA FE       )

          On the 2nd day of February, 1994, before me personally appeared C. Ronald Blankenship, known
to me or proved to me on the basis of satisfactory evidence to be the Chairman and Principal
Executive Officer of Property Trust of America, the real estate investment trust that executed the
foregoing instrument, who, being duly sworn, acknowledged that he resides at 720 Camino Cabra,
Santa Fe, New Mexico 87501; that he knows the seal of said real estate investment trust; that the
seal affixed to said instrument is such corporate seal; that it was so affixed by the authority of
the Board of Trustees of said real estate investment trust; and that he signed his name thereto by
like authority.

                                        

Notary Public

My commission expires:           

CORPORATE ACKNOWLEDGMENT

STATE OF MASSACHUSETTS   )

                                                                )    SS.

COUNTY OF SUFFOLK      )

     On the 2nd day of February, 1994, before me personally appeared Philip M. Crimmins, known to
me or proved to me on the basis of satisfactory evidence to be a Vice President of State Street
Bank and Trust Company, the corporation that executed the foregoing instrument, who, being duly
sworn, acknowledged that he resides at                                                                         
                                                ; that he
knows the seal of said corporation; that the seal affixed to said instrument is such corporate
seal; that it was so affixed by the authority of the Board of Directors of said corporation; and
that he signed his name thereto by like authority.

                                        

Notary Public

My commission expires:           

 

 

CORPORATE ACKNOWLEDGMENT

STATE OF NEW YORK         )

                                                            )    SS.

COUNTY OF NEW YORK     )

          On the 2nd day of February, 1994, before me personally appeared Ward Spooner, known to me or
proved to me on the basis of satisfactory evidence to be a Vice President of Morgan Guaranty Trust
Company of New York, the corporation that executed the foregoing instrument, who, being duly sworn,
acknowledged that he resides at                                                                          
                                               ; that he knows
the seal of said corporation; that the seal affixed to said instrument is such corporate seal; that
it was so affixed by the authority of the Board of Directors of said corporation; and that he
signed his name thereto by like authority.

                                        

Notary Public

My commission expires:           

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Exhibit 4.3

SECOND SUPPLEMENTAL INDENTURE

     SECOND SUPPLEMENTAL INDENTURE, dated as of August 2, 2004 (this “Supplemental
Indenture”), by and between ARCHSTONE-SMITH OPERATING TRUST (formerly known as Property Trust
of America and as Archstone Communities Trust), a real estate investment trust organized under the
laws of the State of Maryland having its principal office at 9200 E. Panorama Circle, Suite 400,
Englewood, Colorado 80112 (hereinafter sometimes called the “Company”), and U.S. BANK
NATIONAL ASSOCIATION (as successor in interest to State Street Bank and Trust Company), having a
corporate trust office at Corporate Trust Services, 100 Wall Street, Suite 1600, New York, New York
10005, as successor Trustee under the Base Indenture (defined below) (the “Trustee”).

RECITALS OF THE COMPANY

     The Company and the Trustee have heretofore entered into an Indenture dated as of February 1,
1994, as amended by a First Supplemental Indenture dated as of February 2, 1994 (as so supplemented
hereinafter called the “Base Indenture”) between the Company and the Trustee, providing for
the issuance by the Company from time to time of its senior debt securities evidencing its
unsecured and unsubordinated indebtedness (the “Securities”).

     Section 301 of the Base Indenture provides for various matters with respect to any series of
Securities issued under the Base Indenture to be established in an indenture supplemental to the
Base Indenture.

     Section 901(7) of the Base Indenture provides for the Company and the Trustee to enter into an
indenture supplemental to the Base Indenture to establish the form of or terms of Securities of any
series as provided by Sections 201 and 301 of the Base Indenture.

     The Board of Trustees of Archstone-Smith Trust, the sole trustee of the Company, has duly
adopted resolutions authorizing the Company to execute and deliver this Supplemental Indenture and
authorized the issuance of the Notes.

     All things necessary to make the Indenture, as hereby modified, a valid agreement of the
Company, in accordance with its terms, have been done.

     NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:

     For and in consideration of the premises and of the covenants contained herein and in the
Indenture, and the purchase of Securities provided for herein by the Holders thereof, the Company
and the Trustee covenant and agree, for the equal and proportionate benefit of all Holders of
Notes, as follows:

ARTICLE ONE

RELATION TO BASE INDENTURE; DEFINITIONS

     Section 1.1. Relation to Base Indenture. This Supplemental Indenture constitutes an
integral part of the Base Indenture.

 

 

     Section 1.2. Definitions. For all purposes of this Supplemental Indenture, except as
otherwise expressly provided for or unless the context otherwise requires:

	 	(1)	 	Capitalized terms used but not defined herein shall have the respective
meanings assigned to them in the Base Indenture;
	 
	 	(2)	 	The definition of the term “Total Assets” provided for herein applies
solely to this Supplemental Indenture and the covenants set forth in Section 2.4
hereof.; and
	 
	 	(3)	 	All references herein to Articles and Sections, unless otherwise specified,
refer to the corresponding Articles and Sections of this Supplemental Indenture.

     “Capitalization Rate” means: (i) 7.5%.

     “Capitalized Property Value” means, as of any date, the aggregate sum of all Property
EBITDA for each such property for the prior four quarters and capitalized at the applicable
Capitalization Rate, provided, however, that if the value of a particular property calculated
pursuant to this clause is less than the undepreciated book value of such property determined in
accordance with GAAP, such undepreciated book value shall be used in lieu thereof with respect to
such property. “Property EBITDA” is defined as, for any period of time, without
duplication net earnings (loss), excluding net derivative gains (losses) and gains (losses) on
dispositions of real estate, before deductions for the Company and its Subsidiaries (including
amounts reported in discontinued operations) for (i) interest expense; (ii) provision for taxes
based on income; (iii) depreciation, amortization and all other non-cash items, as determined in
good faith by the Company, deducted in arriving at net income (loss); (iv) extraordinary items; (v)
non-recurring items, as determined in good faith by the Company (including prepayment penalties);
and (vi) minority interest. In each case for such period, amounts will be as reasonably determined
by the Company in accordance with GAAP, except to the extent GAAP is not applicable with respect to
the determination of all non-cash and non-recurring items. For purposes of this definition,
Property EBITDA will not include corporate level general and administrative expenses and other
corporate expenses such as land holding costs and pursuit cost write-offs as determined in good
faith by the Company.

     “Consolidated EBITDA” means, for any period of time, without duplication net earnings
(loss), excluding net derivative gains (losses) and gains (losses) on dispositions of REIT real
estate investments as reflected in the reports filed by Archstone-Smith Trust under the Exchange
Act, before deductions for the Company and its Subsidiaries (including amounts reported in
discontinued operations) for (i) interest expense; (ii) provision for taxes based on income; (iii)
depreciation, amortization and all other non-cash items, as determined in good faith by the
Company, deducted in arriving at net income (loss); (iv) extraordinary items; (v) non-recurring
items, as determined in good faith by the Company (including prepayment penalties); and (vi)
minority interest. In each case for such period, amounts will be as reasonably determined by the
Company in accordance with GAAP, except to the extent GAAP is not applicable with respect to the
determination of all non-cash and non-recurring items. Consolidated EBITDA will be adjusted,
without duplication, to give pro forma effect: (x) in the case of any assets having been
placed-in-service or removed from service since the beginning of the period and on or prior to the
date of determination, to include or exclude, as the case may be, any Consolidated EBITDA

2

 

earned or eliminated as a result of the placement of such assets in service or removal of such
assets from service as if the placement of such assets in service or removal of such assets from
service occurred at the beginning of the period; and (y) in the case of any acquisition or
disposition of any asset or group of assets since the beginning of the period and on or prior to
the date of determination, including, without limitation, by merger, or share or asset purchase or
sale, to include or exclude, as the case may be, any Consolidated EBITDA earned or eliminated as a
result of the acquisition or disposition of those assets as if the acquisition or disposition
occurred at the beginning of the period.

     “Make-Whole Amount” means, in connection with any optional redemption or accelerated
payment of any Note, the excess, if any, of (i) the aggregate present value as of the date of such
redemption or accelerated payment of each dollar of principal being redeemed or paid and the amount
of interest (exclusive of interest accrued to the date of redemption or accelerated payment) that
would have been payable in respect of such dollar if such redemption or accelerated payment had not
been made, determined by discounting, on a semiannual basis, such principal and interest at the
Reinvestment Rate (determined on the third Business Day preceding the date such notice of
redemption is given or declaration of acceleration is made) from the respective dates on which such
principal and interest would have been payable if such redemption or accelerated payment had not
been made, over (ii) the aggregate principal amount of the Securities being redeemed or paid.

     “Reinvestment Rate” means .25% (one-quarter of one percent) plus the arithmetic mean
of the yields under the respective headings “This Week” and “Last Week” published in the
Statistical Release under the caption “Treasury Constant Maturities” for the maturity (rounded to
the nearest month) corresponding to the remaining life to maturity, as of the payment date of the
principal being redeemed or paid. If no maturity exactly corresponds to such maturity, yields for
the two published maturities most closely corresponding to such maturity shall be calculated
pursuant to the immediately preceding sentence and the Reinvestment Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding in each of such relevant periods
to the nearest month. For the purposes of calculating the Reinvestment Rate, the most recent
Statistical Release published prior to the date of determination of the Make-Whole Amount shall be
used.

     “Stabilized Property” means (i) with respect to an acquisition of an income producing
property, a property becomes stabilized when the Company or its Subsidiaries have owned the
property for at least four (4) full quarters and (ii) with respect to new construction or
development property, a property becomes stabilized four (4) full quarters after the earlier of (a)
eighteen (18) months after substantial completion of construction or development, and (b) the
quarter in which the occupancy level of the property is at least ninety-three percent (93%).

     “Statistical Release” means the statistical release designated “H.15(519)” or any
successor publication which is published weekly by the Federal Reserve System and which establishes
yields on actively traded United States government securities adjusted to constant maturities, or,
if such statistical release is not published at the time of any determination under the Indenture,
then such other reasonably comparable index which shall be designated by the Company.

3

 

     “Total Assets” means the sum of: (1) for Stabilized Properties, Capitalized Property
Value; and (2) for all other assets of the Company and its Subsidiaries, undepreciated book value
as determined in accordance with GAAP.

ARTICLE TWO

THE NOTES

     Section 2.1. Title of Securities. There shall be a series of Securities designated
the “5.625 % Senior Notes due 2014” (the “Notes”).

     Section 2.2. Limitation on Aggregate Principal Amount. The aggregate principal amount
of the Notes initially shall be limited to $300,000,000. The Company may, subject to Section 2.4
of this Supplemental Indenture and applicable law, issue additional Notes under this Supplemental
Indenture without the consent of the Holders of outstanding Notes. The initially issued Notes and
any additional Notes subsequently issued shall be treated as a single class for all purposes of
this Supplemental Indenture and the Base Indenture and such additional Notes shall be substantially
identical to initially issued Notes. Nothing contained in this Section 2.2 or elsewhere in this
Supplemental Indenture, or in the Notes, is intended to or shall limit execution by the Company or
authentication or delivery by the Trustee of Notes under the circumstances contemplated by Sections
303, 304, 305, 306, 906, 1107 and 1305 of the Base Indenture.

     Section 2.3. Interest and Interest Rates; Maturity Date of Notes.

     (a) The Notes shall bear interest at 5.625% per annum from August 2, 2004 or from the
immediately preceding Interest Payment Date (as defined below) to which interest has been
paid, payable semi-annually in arrears on February 15 and August 15 of each year, commencing
February 15, 2005 (each, an “Interest Payment Date”), to the persons (the
“Holders”) in whose name the applicable Notes are registered in the Security
Register at the close of business 15 calendar days prior to such Interest Payment Date
(i.e., February 1 and August 1, respectively) (regardless of whether such day is a Business
Day, as defined below), as the case may be (each, a “Regular Record Date”). Interest
on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months.
Interest, if any, not punctually paid or duly provided for on any Interest Payment Date with
respect to a Note (“Defaulted Interest”) shall forthwith cease to be payable to the
Holder on the applicable Regular Record Date and may either be paid to the person in whose
name such Note is registered at the close of business on a special record date (the
“Special Record Date”) for the payment of such Defaulted Interest to be fixed by the
Trustee, notice of which shall be given to the Holder of such Note not less than ten days
prior to such Special Record Date, or may be paid at any time in any other lawful manner, as
more particularly described in the Base Indenture.

     (b) If any Interest Payment Date or Maturity falls on a day that is not a Business Day,
the required payment shall be made on the next Business Day as if it were made on the date
such payment was due and no interest shall accrue on the amount so payable for the period
from and after such Interest Payment Date or Maturity, as the case may be.

4

 

     (c) The Notes shall mature on August 15, 2014.

     Section 2.4. Limitations on Incurrence of Debt. In addition to the covenants set
forth in Article TEN of the Base Indenture, there are established pursuant to Section 901(2) of the
Base Indenture the following covenants for the benefit of the Holders of the Notes and to which the
Notes shall be subject; provided, however, that the covenants set forth in Section
1004 of the Base Indenture shall apply to the Notes only for so long as any Securities issued
pursuant to the Base Indenture prior to the date hereof remain outstanding:

     (a) The Company will not, and will not permit any Subsidiary to, incur any Debt if,
immediately after giving effect to the incurrence of such additional Debt and the
application of the proceeds thereof, Debt would exceed 65% of Total Assets at the reporting
date.

     (b) In addition to the limitations set forth in Section 2.4(a) of this Supplemental
Indenture, the Company will not, and will not permit any Subsidiary to, incur any Debt if
the ratio of Consolidated EBITDA to the Annual Service Charge for the four consecutive
fiscal quarters most recently ended prior the date on which such additional Debt is to be
incurred shall have been less than 1.5, on a pro forma basis after giving effect thereto and
to the application of the proceeds therefrom, and calculated on the assumption that (i) such
Debt and any other Debt incurred by the Company and its Subsidiaries since the first day of
such four-quarter period and the application of the proceeds therefrom, including to
refinance other Debt, had occurred at the beginning of such period; (ii) the repayment or
retirement of any other Debt by the Company and its Subsidiaries since the first day of such
four-quarter period had been incurred, repaid or retired at the beginning of such period
(except that, in making such computation, the amount of Debt under any revolving credit
facility shall be computed based upon the average daily balance of such Debt during such
period); (iii) in the case of Acquired Debt or Debt incurred in connection with any
acquisition since the first day of such four-quarter period, the related acquisition had
occurred as of the first day of such period with the appropriate adjustments with respect to
such acquisition being included in such pro forma calculation; and (iv) in the case of any
acquisition or disposition by the Company or its Subsidiaries of any asset or group of
assets since the first day of such four-quarter period, whether by merger, stock purchase or
sale, or asset purchase or sale, such acquisition or disposition or any related repayment of
Debt had occurred as of the first day of such period with the appropriate adjustments with
respect to such acquisition or disposition being included in such pro forma calculation.

     (c) In addition to the limitation set forth in subsections (a) and (b) of this Section
2.4, the Company will not, and will not permit any Subsidiary to, incur any Debt secured by
any mortgage, lien, charge, pledge, encumbrance or security interest of any kind upon any of
the property of the Company or any Subsidiary, whether owned at the date hereof or hereafter
acquired, if, immediately after giving effect to the incurrence of such additional Debt and
the application of the proceeds thereof, the aggregate principal amount of all outstanding
Debt of the Company and its Subsidiaries on a consolidated basis which is secured by any
mortgage, lien, charge, pledge, encumbrance or security

5

 

interest on property of the Company or any Subsidiary is greater than 40% of the
Company’s Total Assets.

     (d) For purposes of this Section 2.4 Debt shall be deemed to be “incurred” by the
Company or a Subsidiary whenever the Company or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof.

     Section 2.5. Optional Redemption. The Notes shall be redeemable, at the option of the
Company, in whole at any time or in part from time to time, as provided in Article ELEVEN of the
Base Indenture, and at a redemption price equal to the sum of (i) the principal amount of the Notes
being redeemed plus accrued interest thereon to the redemption date and (ii) the Make-Whole Amount,
if any (the “Redemption Price”).

     Section 2.6. Places of Payment. The Places of Payment where the Notes may be
presented or surrendered for payment, where the Notes may be surrendered for registration of
transfer or exchange and where notices and demands to and upon the Company in respect of the Notes
and the Base Indenture may be served shall be the office or agency of the Trustee for such purpose
which shall initially be located at c/o U.S. Bank National Association, 60 Livingston Avenue, St.
Paul, Minnesota 55107.

     Section 2.7. Method of Payment. Payment of the principal of and interest on the Notes
shall be made at the office or agency of the Company maintained for that purpose (which shall
initially be an office or agency of the Trustee), in such coin or currency of the United States of
America as at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company, payments of principal and
interest on the Notes (other than payments of principal and interest due at Maturity) may be made
(i) by check mailed to the address of the Person entitled thereto as such address shall appear in
the Security Register or (ii) by wire transfer to an account maintained by the Person entitled
thereto located within the United States.

     Section 2.8. Currency. Principal and interest on the Notes shall be payable in
Dollars.

     Section 2.9. Registered Securities; Global Form. The Notes shall be issuable and
transferable in fully registered form as Registered Securities, without coupons. The Notes shall
initially be issued in the form of one or more permanent global Notes. The depository for the Notes
shall be The Depository Trust Company (the “Depositary”). The Notes shall not be issuable
in definitive form except as provided in Section 305 of the Base Indenture.

     Section 2.10. Form of Notes. The Notes shall be substantially in the form attached as
Exhibit A hereto.

     Section 2.11. Transfer and Exchange. Transfers and exchanges of Notes shall be made
in the manner described in Section 305 of the Base Indenture.

     Section 2.12. General Provisions Relating to Transfers and Exchanges.

     (a) The Trustee and the Security Registrar will retain copies of all certificates,
opinions and other documents received in connection with the transfer or exchange of a

6

 

Note (or a beneficial interest therein), in accordance with its standard record
retention procedures and the Company will have the right to inspect and make copies thereof
at any reasonable time upon written notice to the Trustee or the Security Registrar, as the
case may be.

     (b) Each Holder of a Note agrees to indemnify the Company, Security Registrar and the
Trustee against any liability that may result from the transfer, exchange or assignment of
such Holder’s Note in violation of any provision of this Supplemental Indenture or
applicable United States federal or state securities law.

     (c) The Trustee shall have no obligation or duty to monitor, determine or inquire as to
compliance with any restrictions on transfer imposed under this Supplemental Indenture or
under applicable law with respect to any transfer of any interest in any Note (including any
transfers between or among members of, or participants or indirect participants in, the
Depositary or beneficial owners of interests in any global Note) other than to require
delivery of such certificates and other documentation or evidence as are expressly required
by, and to do so if and when expressly required by the terms of, this Supplemental
Indenture, and to examine the same to determine substantial compliance as to form with the
express requirements hereof.

     Section 2.13. Registrar and Paying Agent. The Trustee shall initially serve as
Security Registrar and Paying Agent for the Notes.

     Section 2.14. Defeasance. The provisions of Article FOURTEEN of the Base Indenture
shall be applicable to the Notes. The provisions of Section 1403 of the Base Indenture shall apply
to the covenants set forth in Section 2.4 of this Supplemental Indenture and to those covenants
specified in Section 1403 of the Base Indenture.

     Section 2.15. Waiver of Certain Covenants. Notwithstanding the provisions of Section
1012 of the Base Indenture, the Company may omit in any particular instance to comply with any
term, provision or condition set forth in Sections 1004 to 1009, inclusive, of the Base Indenture,
with Section 2.4 of this Supplemental Indenture and with any other term, provision or condition
with respect to the Notes (except any such term, provision or condition which could not be amended
without the consent of all Holders of the Notes), if before or after the time for such compliance
the Holders of at least a majority in principal amount of all outstanding Notes, by Act of such
Holders, either waive such compliance in such instance or generally waive compliance with such
covenant or condition. Except to the extent so expressly waived, and until such waiver shall become
effective, the obligations of the Company and the duties of the Trustee in respect of any such
term, provision or condition shall remain in full force and effect.

     Section 2.16. No Sinking Fund. The provisions of Article TWELVE of the Base Indenture
shall not be applicable to the Notes.

     Section 2.17. No Repayment at Option of Holders. The provisions of Article THIRTEEN
of the Base Indenture shall not be applicable to the Notes.

7

 

ARTICLE THREE

MISCELLANEOUS PROVISIONS

     Section 3.1. All capitalized terms which are used herein and not otherwise defined herein are
defined in the Indenture and are used herein with the same meanings as in the Indenture.

     Section 3.2. This Supplemental Indenture shall be effective as of the opening of business on
the date first above written upon the execution and delivery hereof by each of the parties hereto.

     Section 3.3. Except as expressly modified or amended hereby, the Base Indenture continues in
full force and effect and is in all respects confirmed, ratified and preserved.

     Section 3.4. Except as expressly amended hereby, the Indenture shall continue in full force
and effect in accordance with the provisions thereof and the Indenture is in all respects hereby
ratified and confirmed. This Supplemental Indenture and all its provisions shall be deemed a part
of the Indenture in the manner and to the extent herein and therein provided.

     Section 3.5. This Supplemental Indenture shall be governed by, and construed in accordance
with, the laws of the State of New York.

     Section 3.6. This Supplemental Indenture may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all such counterparts shall together
constitute but one and the same instrument.

     Section 3.7. The Trustee shall have not any responsibility for the Recitals of the Company
hereto, which Recitals are made by the Company alone, or for the validity or sufficiency of this
Supplement Indenture.

[Remainder of page intentionally left blank]

8

 

          IN WITNESS WHEREOF, the parties hereto have caused this Second Supplemental Indenture to be
duly executed and their respective corporate seals to be hereunto affixed and attested, all as of
the day and year first above written.

	 	 	 	 	 
	 	ARCHSTONE-SMITH OPERATING TRUST

 	 
	 	By:  	
 	 
	 	 	[Name] 	 
	 	 	[Title] 	 
	 

	 	 	 	 	 
	[SEAL]

Attest:

 	 	 
	By:  	 	 	 
	 	Caroline Brower 	 	 
	 	Secretary 	 	 
	 

	 	 	 	 	 
	 	U.S. BANK NATIONAL ASSOCIATION, as
 Trustee as
aforesaid

 	 
	 	By:  	 	 
	 	 	[Name] 	 
	 	 	[Title] 	 
	 

	 	 	 	 	 
	Attest:

 	 	 
	By:  	 	 	 
	 

 

EXHIBIT A

FORM OF NOTE

Unless this certificate is presented by an authorized representative of The Depository Trust
Company, a New York corporation (“DTC”), to the Company (as defined below) or its agent for
registration of transfer, exchange, or payment, and any certificate issued is registered in the
name of Cede & Co. or in such other name as is requested by an authorized representative of DTC
(and any payment is made to Cede & Co. or to such other entity as is requested by an authorized
representative of DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO
ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

	 	 	 
	REGISTERED

	 	PRINCIPAL AMOUNT
	No.: 1

	 	$                    
	CUSIP No.:                     
	 	 

ARCHSTONE-SMITH OPERATING TRUST

                    % NOTE DUE 20__

     ARCHSTONE-SMITH OPERATING TRUST, a real estate investment trust organized and existing under
the laws of the State of Maryland (hereinafter called the “Company,” which term shall include any
successor under the Indenture hereinafter referred to), for value received, hereby promises to pay
to CEDE & CO., or registered assigns, upon presentation, the principal sum of _________ DOLLARS on ______, 20___ and to pay interest on the outstanding principal amount thereon from
______, 2004 or from the most recent Interest Payment Date to which interest has been paid or
duly provided for, semi-annually in arrears on ______ and ______ in each year, commencing
on ______, 2004, at the rate of ___% per annum, until the entire principal hereof is paid or
made available for payment. The interest so payable, and punctually paid or duly provided for on
any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name
this Security (or one or more Predecessor Securities) is registered at the close of business on the
Regular Record Date for such interest which shall be the ______ or ______ (whether or not a
Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest
not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on
such Regular Record Date, and may either be paid to the Person in whose name this Security (or one
or more Predecessor Securities) is registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to
Holders of Securities of this series not more than 15 days and not less than 10 days prior to such
Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with
the requirements of any securities exchange on which the Securities may be listed, and upon such
notice as may be required by such exchange, all as more fully provided in the Indenture. Payment
of the principal of, Make-Whole Amount, if any, on, and interest on this Security will be made at
the office or agency of the Company maintained for that purpose in the City of Minneapolis,
Minnesota, or elsewhere as provided in the Indenture, in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and private debts;
provided, however, that at the option of the Company payment of interest may be

A-1

 

made by (i) check mailed to the address of the Person entitled thereto as such address shall
appear in the Security Register or (ii) transfer to an account of the Person entitled thereto
located inside the United States.

     Each Security of this series is one of a duly authorized issue of securities of the Company
(herein called the “Securities”), issued and to be issued in one or more series under an Indenture,
dated as of February 1, 1994, between Archstone-Smith Operating Trust (formerly known as Archstone
Communities Trust and prior thereto Security Capital Pacific Trust and Property Trust of America)
(the “Company”) and Morgan Guaranty Trust Company of New York, as trustee (“Morgan”), as
supplemented by the First Supplemental Indenture dated as of February 2, 1994 (the “Indenture”)
between the Company, State Street Bank and Trust Company, as successor trustee, and Morgan, and as
further supplemented by the Second Supplemental Indenture dated as of July ______, 2004 between the
Company and U.S. Bank National Association, as successor trustee (herein called the “Trustee,”
which term includes any successor trustee under the Indenture with respect to the series of which
this Security is a part) to which Indenture and all indentures supplemental thereto reference is
hereby made for a statement of the respective rights, limitations of rights, duties and immunities
thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon
which the Securities are, and are to be, authenticated and delivered. This Security is one of the
series designated on the first page hereof, initially limited in aggregate principal amount to
$______, subject to the Company’s right to increase the aggregate principal amount of such
series from time to time.

     Securities of this series may be redeemed at any time at the option of the Company, in whole
or in part, at a redemption price equal to the sum of (i) the principal amount of the Securities
being redeemed plus accrued interest thereon to the Redemption Date and (ii) the Make-Whole Amount,
if any, with respect to such Securities.

     The following definitions apply with respect to any redemption of the Securities of this
series at the option of the Company:

     “Make-Whole Amount” means, in connection with any optional redemption or accelerated payment
of any Security, the excess, if any, of (i) the aggregate present value as of the date of such
redemption or accelerated payment of each dollar of principal being redeemed or paid and the amount
of interest (exclusive of interest accrued to the date of redemption or accelerated payment) that
would have been payable in respect of such dollar if such redemption or accelerated payment had not
been made, determined by discounting, on a semiannual basis, such principal and interest at the
Reinvestment Rate (determined on the third Business Day preceding the date such notice of
redemption is given or declaration of acceleration is made) from the respective dates on which such
principal and interest would have been payable if such redemption or accelerated payment had not
been made, over (ii) the aggregate principal amount of the Securities being redeemed or paid.

     “Reinvestment Rate” means .___% (one-quarter of one percent) plus the arithmetic mean of the
yields under the respective headings “This Week” and “Last Week” published in the Statistical
Release under the caption “Treasury Constant Maturities” for the maturity (rounded to the nearest
month) corresponding to the remaining life to maturity, as of the payment date of the principal
being redeemed or paid. If no maturity exactly corresponds to such maturity, yields for

A-2

 

the two published maturities most closely corresponding to such maturity shall be calculated
pursuant to the immediately preceding sentence and the Reinvestment Rate shall be interpolated or
extrapolated from such yields on a straight-line basis, rounding in each of such relevant periods
to the nearest month. For the purposes of calculating the Reinvestment Rate, the most recent
Statistical Release published prior to the date of determination of the Make-Whole Amount shall be
used.

     “Statistical Release” means the statistical release designated “H.15(519)” or any successor
publication which is published weekly by the Federal Reserve System and which establishes yields on
actively traded United States government securities adjusted to constant maturities, or, if such
statistical release is not published at the time of any determination under the Indenture, then
such other reasonably comparable index which shall be designated by the Company.

     The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness of
the Company on this Security and (b) certain restrictive covenants and the related defaults and
Events of Default applicable to the Company, in each case, upon compliance by the Company with
certain conditions set forth in the Indenture, which provisions apply to this Security.

     If an Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of, and the Make-Whole Amount, if any, on, the Securities of this series
may be declared due and payable in the manner and with the effect provided in the Indenture.

     As provided in and subject to the provisions of the Indenture, unless the principal of all of
the Securities of this series at the time Outstanding shall already have become due and payable,
the Holder of this Security shall not have the right to institute any proceeding with respect to
the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder,
unless such Holder shall have previously given the Trustee written notice of a continuing Event of
Default with respect to the Securities of this series, the Holders of not less than 25% in
principal amount of the Securities of this series at the time Outstanding shall have made written
request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and
offered the Trustee reasonable indemnity and the Trustee shall not have received from the Holders
of a majority in principal amount of Securities of this series at the time Outstanding a direction
inconsistent with such request, and the Trustee shall have failed to institute any such proceeding
for 60 days after receipt of such notice, request and offer of indemnity. The foregoing shall not
apply to any suit instituted by the Holder of this Security for the enforcement of any payment of
principal hereof or any interest on or after the respective due dates expressed herein.

     The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Securities of each series to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of not less than a majority in principal amount of the
Outstanding Securities of each series of Securities then Outstanding affected thereby. The
Indenture also contains provisions permitting the Holders of specified percentages in principal
amount of the Securities of each series at the time Outstanding, on behalf of the

A-3

 

Holders of all Securities of such series, to waive compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such
Holder and upon all future Holders of this Security and of any Security issued upon the
registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation
of such consent or waiver is made upon this Security.

     No reference herein to the Indenture and no provision of this Security or of the Indenture
shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay
the principal of, Make-Whole Amount, if any, on, and interest on this Security at the times, place
and rate, and in the coin or currency, herein prescribed.

     As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Security is registrable in the Security Register, upon surrender of this Security
for registration of transfer at the office or agency of the Company in any Place of Payment where
the principal of, Make-Whole Amount, if any, on, and interest on this Security are payable duly
endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company
and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Securities of this series, of authorized denominations and
for the same aggregate principal amount, will be issued to the designated transferee or
transferees.

     The Securities of this series are issuable only in registered form without coupons in
denominations of $1,000 and any integral multiple thereof. As provided in the Indenture and
subject to certain limitations therein set forth, Securities of this series are exchangeable for a
like aggregate principal amount of Securities of this series of a different authorized
denomination, as requested by the Holder surrendering the same.

     No service charge shall be made for any such registration of transfer or exchange, but the
Company may require payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith.

     Prior to due presentment of this Security for registration of transfer, the Company, the
Trustee and any agent of the Company or the Trustee may treat the Person in whose name this
Security is registered as the owner hereof for all purposes, whether or not this Security be
overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

     No recourse under or upon any obligation, covenant or agreement contained in the Indenture or
in this Security, or because of any indebtedness evidenced thereby, shall be had against any
promoter, as such, or against any past, present or future shareholder, officer or trustee, as such,
of the Company or of any successor, either directly or through the Company or any successor, under
any rule of law, statute or constitutional provision or by the enforcement of any assessment or by
any legal or equitable proceeding or otherwise, all such liability being expressly waived and
released by the acceptance of this Security by the Holder thereof and as part of the consideration
for the issue of the Securities of this series.

A-4

 

     All terms used in this Security which are defined in the Indenture shall have the meanings
assigned to them in the Indenture.

     THE INDENTURE AND THE SECURITIES, INCLUDING THIS SECURITY, SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK.

     Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification
Procedures, the Company has caused “CUSIP” numbers to be printed on the Securities of this series
as a convenience to the Holders of such Securities. No representation is made as to the
correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be
placed only on the other identification numbers printed hereon.

[This space intentionally left blank.]

A-5

 

     Unless the certificate of authentication hereon has been executed by or on behalf of the
Trustee by manual signature, this Security shall not be entitled to any benefit under the Indenture
or be valid or obligatory for any purpose.

     IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed by the
undersigned officer.

	 	 	 	 	 
	 	Archstone-Smith Operating Trust

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 

	 	 	 	 	 
	Attest

 	 	 
	By:  	 	 	 
	 	Name:  	 	 	 
	 	Title:  	 	 	 
	 

Dated: July __, 2004

TRUSTEE’S CERTIFICATE OF AUTHENTICATION:

     This is one of the Securities of the series designated therein referred to in the
within-mentioned Indenture.

	 	 	 	 	 
	U.S. BANK NATIONAL ASSOCIATION, as Trustee

 	 	 
	By:  	 	 	 
	 	Authorized Officer 	 	 
	 	 	 	 

A-6

 

	 	 	 	 	 

ASSIGNMENT FORM

FOR VALUE RECEIVED, the undersigned hereby

sells, assigns and transfers unto

PLEASE INSERT SOCIAL

SECURITY OR OTHER IDENTIFYING

NUMBER OF ASSIGNEE

	 	 	 	 	 
	 	 	 	 	 
	 	 
	 	 	 
	 	 

	 	 	 
	 	 	 	 	 

(Please Print or Typewrite Name and Address including

Zip Code of Assignee)

the within Security of Archstone-Smith Operating Trust and hereby does irrevocably constitute and
appoint

                                                                     
                                                                              
                                  Attorney
to transfer said Security on the books of the within named Company with full power of substitution
in the premises.

     Dated:                                         

NOTICE: The signature to this assignment must correspond with the name as it appears on the first
page of the within Security in every particular, without alteration or enlargement or any change
whatever.

A-7

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