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Exhibit 4.1    
    

 
 

ARTICLES SUPPLEMENTARY
  APARTMENT INVESTMENT AND MANAGEMENT COMPANY    
    

Class X 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 2,000,000 authorized but unissued shares of
Class A Common Stock of the Corporation, par value $.01 per share, into a class designated as Class X 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 X Cumulative Convertible Preferred
Stock, par value $.01 per share, from no shares immediately prior to the reclassification to 2,000,000 shares immediately after the reclassification. The reclassification decreases the number of
shares classified as Class A Common Stock from 431,607,976 shares immediately prior to the reclassification to 429,607,976 shares immediately after the reclassification. The number of shares
classified as Class X 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 X 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 X Cumulative Convertible Preferred Stock (the "Class X Preferred Stock") and Two Million (2,000,000) shall be the
authorized number of shares of such Class X Preferred Stock constituting such class. 

2.    Definitions.    

        For
purposes of the Class X 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 (i) for the period from the Issue Date through and including March 31, 2006, a quarterly dividend
payment in an amount per share equal to $0.53125, and (ii) after March 31, 2006, a quarterly dividend payment in an amount per share equal to $0.5625; 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) $0.75 or (b) the product of (x) $6.25 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 X 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 X 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 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 

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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 X
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
0.4762 shares of Class A Common Stock for each share of Class X Preferred Stock). 

        "Coverage Event" shall have the meaning set forth in Section 6.5(a) of the Exchange Agreement. 

        "Dividend Payment Date" shall mean January 1, April 1, July 1 and October 1 of each year; provided, 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 X Preferred Stock shall be redeemed pursuant to Section 5 hereof, which shall end on and include the Redemption Date with respect to the
Class X 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 29, 2004, by and among GE Capital Equity
Investments, Inc., 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 the Issue Date, and ending on and including
December 31, 2004. 

        "Initial Holder" shall mean Terry Considine. 

        "Initial Holder Limit" shall mean a number of the Outstanding shares of Class X 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 X Preferred Stock that are Beneficially Owned by the Initial Holder. From the 

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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 X 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 X 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 X 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 X 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. 

        "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 X Preferred Stock, the date fixed for redemption
of such shares. 

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        "Redemption Price" shall mean, with respect to any share of Class X Preferred Stock to be redeemed, (i) if the Redemption
Date is prior to March 31, 2006, 102% of the Liquidation Preference thereof, or (ii) if the Redemption Date is on or after March 31, 2006, 100% of the Liquidation Preference
thereof, plus, in either case, 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 X
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 X 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 X Preferred Stock or
(ii) the sale, transfer, assignment or other disposition of any securities or rights convertible into or exchangeable for Class X 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 X Preferred Stock). The term "Transfers" and
"Transferred" shall have correlative meanings. 

        "Transfer Agent" shall mean such transfer agent as may be designated by the Board of Directors or their designee as the transfer agent for
the Class X 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 X 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 X Preferred Stock shall be entitled to receive, when and as declared by the Board of Directors out of funds legally available for that
purpose, quarterly cash dividends payable in cash in an amount per share of Class X 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 X 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 X 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 X 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 X Preferred Stock for such Dividend Period, the Corporation shall pay an additional
dividend to the holders of the Class X 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 X 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 January 1, 2005. Each such dividend shall be payable in arrears to the holders of record of the
Class X Preferred Stock, as they appear on the stock records of the Corporation at the close of business on the tenth Business Day immediately preceding such Dividend Payment Date. 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 X Preferred Stock for 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 X 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 X 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 X Preferred Stock that may be in arrears. 

        (c)   So
long as any of the shares of Class X 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 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 X 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 X Preferred Stock and all dividends declared upon any 

6

 

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 X Preferred Stock and
accumulated, accrued and unpaid on such Parity Stock. 

        (d)   So
long as any of the shares of Class X 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 X 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 X 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 X 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 X Preferred Stock shall be entitled to receive Twenty
Five Dollars ($25.00) per share of Class X 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 X 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 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 X 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 X Preferred Stock and any such
other Parity Stock ratably in the same proportion as the 

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respective
amounts that would be payable on such Class X 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 X 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 X 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 X Preferred Stock shall not be redeemable by the Corporation prior to March 31, 2006, except (i) as set forth in Section 10.2
of this Article, or (ii) during the 60 day period immediately following a Coverage Event. The Corporation, at its option, may redeem shares of Class X Preferred Stock, in whole or
from time to time in part, at a price payable in cash equal to the Redemption Price applicable thereto, (i) prior to March 31, 2006, only during the 60 day period immediately
following a Coverage Event, and (ii) at any time on or after March 31, 2006. 

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

        (d)   If
the Corporation shall redeem shares of Class X 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 X 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 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 X Preferred Stock so called for redemption shall
cease to accumulate or accrue on the shares of Class X 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 X Preferred Stock of the Corporation shall cease (except the right to receive the cash payable upon such redemption, without interest thereon, upon 

8

 

surrender
of their certificates if so required); provided, however, that if the Redemption Date for any shares of Class X 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 X 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 X Preferred Stock called for redemption, with irrevocable instructions that such cash be applied to the redemption of
the shares of Class X 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 X 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 X 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 X 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 X Preferred Stock are to be redeemed,
shares to be redeemed shall be selected by the Corporation from outstanding shares of Class X Preferred Stock not previously called for redemption by lot or, with respect to the number of
shares of Class X 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 X 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 X Preferred Stock that have been issued and reacquired in any manner by the Corporation (including, without limitation, shares of Class X Preferred
Stock which have been surrendered for conversion) shall be returned to the status of authorized but unissued shares of Class X Preferred Stock. 

7.    Conversion.    

        7.1    Conversion at Holders Option.    

        At
any time on or after the Issue Date, holders of shares of Class X 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 X 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 

9

 

Class A
Common Stock (calculated as to each conversion to the nearest 1/100th of a share) obtained by dividing the Liquidation Preference per share of Class X 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 X
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 X 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 X 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 X 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 X Preferred Stock is registered, each certificate representing a share of Class X 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 X 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 X 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 X 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 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 X Preferred Stock at the close of business on a record date for the payment of dividends on the Class X
Preferred Stock will be entitled to receive an amount equal to the dividend payable on such shares on the corresponding Dividend 

10

 

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 X 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 X 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 X 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 X
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 X Preferred Stock. If more than one share of Class X 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 X 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 X 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 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 X Preferred Stock thereafter surrendered for conversion shall be entitled to receive the number of 

11

 

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 X 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. 

        (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 

12

 

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 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. 

        (vi)  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 

13

 

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 X 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 X
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 X
Preferred Stock that will contain provisions enabling the holders of the Class X 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. 

        (b)   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 to be mailed to each holder of shares of Class X 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. 

14

 

        (c)   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 X Preferred Stock at such holder's
last address as shown on the stock records of the Corporation. 

        (d)   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 X 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. 

        (e)   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. 

        (f)    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 X Preferred Stock, the Conversion Price for the Class X 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. 

        (g)   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 X Preferred Stock, the full number of shares of Class A Common Stock deliverable upon the conversion of all outstanding
shares of Class X 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 X Preferred Stock shall be computed as if at the time of computation all such 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 X 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 X 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. 

        (h)   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 X 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 X Preferred Stock to be 

15

 

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. 

        (i)    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. 

        (j)    Notwithstanding
anything to the contrary contained in this Section 7.2, conversion of Class X 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 X 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 X 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 X Preferred Stock ("Senior Stock"); 

        (b)   on
a parity with the Class X 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 X 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, Class V Cumulative Preferred Stock or Class W Cumulative Convertible
Preferred Stock of the Corporation, or (ii) the holders of such class of stock or series and the Class X Preferred Stock shall be entitled to the receipt of dividends and of amounts
distributable upon liquidation, dissolution or winding up in 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 X 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 X 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 

16

 

to
Section 7.3 of this Article) (the "Base Common Stock Dividend"), or (ii) the Corporation fails to pay a quarterly dividend payable on the Class X 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 X 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 X 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 X 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 X 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 X 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 X
Preferred Stock, the Secretary of the Corporation may, and upon the written request of any holder of Class X Preferred Stock (addressed to the Secretary at the principal office of the
Corporation) shall, call a special meeting of the holders of the Class X 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 X 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 X
Preferred Stock, a successor shall be elected by the Board of Directors, upon the nomination of the holders of the Class X 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 X 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 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 X 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 X Preferred Stock and the Voting Preferred Stock
called as hereinafter provided. Whenever all arrears in dividends on the Class X 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 X 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 X Preferred Stock and the Voting Preferred Stock shall forthwith terminate and the number of directors
constituting the Board of Directors shall be 

17

 

reduced
accordingly. At any time after such voting power shall have been so vested in the holders of Class X 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 X Preferred Stock (addressed to the Secretary at the principal office of the Corporation) shall, call a special meeting of
the holders of the Class X 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 X 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 X
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 X 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 X 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 X 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 X Preferred Stock (including any amendment,
alteration or repeal effected pursuant to a merger, consolidation or similar transaction) or would convert the Class X 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 X Preferred Stock; or 

         (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 X 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 X 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 X 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 X Preferred Stock as a single class on any matter, then the
Class X 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 X Preferred Stock shall not have any relative, participating, optional or other special 

18

 

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 X 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 X Preferred Stock in excess of the Ownership Limit, the Initial Holder shall not Beneficially Own shares of
Class X Preferred Stock in excess of the Initial Holder Limit and no Look-Through Entity shall Beneficially Own shares of Class X 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 X Preferred Stock in excess of the Ownership Limit
shall be void ab initio as to the Transfer of such shares of Class X 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 X 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 X Preferred Stock in excess of the Initial Holder Limit shall be void ab
initio as to the Transfer of such shares of Class X 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 X 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 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 X Preferred Stock in excess of the
Look-Through Ownership limit shall be void ab initio as to the Transfer of such shares of Class X 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 X 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 X 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 

19

 

the
case may be, and the intended transferee shall acquire no rights in such shares of Class X Preferred Stock. 

        (f)    Severability
on Void Transactions. A Transfer of a share of Class X 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 X 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 X 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 X 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 X 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 X Preferred Stock that is expressly authorized pursuant to Section 10.8(c) of this Article. 

        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 X Preferred Stock in excess of the Ownership Limit, or (b) the Initial Holder would
Beneficially Own shares of Class X 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 X 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 X 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 X 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 

20

 

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 X 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 X 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 X 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 X 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 X 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 X
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 X 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 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 X Preferred Stock as to which such restrictions would, by their terms,
apply, and to hold such Class X Preferred Stock on behalf of the Corporation. 

        (f)    Purchase Right in Stock Transferred to the Trustee.    Shares of Class X
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 

21

 

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 X 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 X 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 X 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 X 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 X Preferred Stock Beneficially Owned, and a full description of how such shares
are held. Each such record holder or Beneficial Owner of Class X 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 X Preferred Stock as the Board of Directors, in its sole discretion, deems appropriate or necessary to (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 X 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 X Preferred Stock and any Person (including the stockholder of record) that is holding shares of Class X 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 X 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 

22

 

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 X 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 X 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 X Preferred Stock) following the purchase of Class X Preferred Stock by an underwriter that (i) is a
corporation, partnership or other legal entity and (ii) participates in an offering of the Class X Preferred Stock, such underwriter shall not be subject to the Ownership Limit with
respect to the Class X Preferred Stock purchased by it as a part of or in
connection with such offering and with respect to any Class X Preferred Stock purchased in connection with market making activities. 

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

"The
shares of Class X Cumulative Convertible Preferred Stock represented by this certificate are subject to restrictions on transfer. No person may Beneficially Own shares of Class X
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 X Cumulative Convertible Preferred Stock). Any Person that attempts to Beneficially Own shares of Class X 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 X 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 X
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 X Cumulative
Convertible Preferred Stock) or 

23

 

(ii) the
shares of Class X 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 X Cumulative Convertible Preferred Stock set forth in Article Third hereof shall become
Article XXXV 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 29, 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

Exhibit 4.1

ARTICLES SUPPLEMENTARY APARTMENT INVESTMENT AND MANAGEMENT COMPANYQuickLinks
 -- Click here to rapidly navigate through this document

 
 

Exhibit 10.1    
    

	

    
	

    
	

 EXCHANGE AGREEMENT
	

DATED AS OF SEPTEMBER 29, 2004
	

AMONG
	

GE CAPITAL EQUITY INVESTMENTS, INC.,
	

APARTMENT INVESTMENT AND MANAGEMENT COMPANY
	

AND
	

AIMCO PROPERTIES, L.P.
	

    
	

    

  

 
 

TABLE OF CONTENTS    
    

	 
	 
	 
	Page

	I.	EXCHANGE OF SHARES.	1
	

 	

1.1	

Exchange of Shares.	

1
	

 	

1.2	

Closing.	

1
	

II.	

REPRESENTATIONS AND WARRANTIES OF THE COMPANY.	

2
	

 	

2.1	

Organization, Good Standing and Qualification.	

2
	

 	

2.2	

Power, Authority and Enforceability.	

2
	

 	

2.3	

Capitalization.	

2
	

 	

2.4	

Valid Issuance of Shares.	

3
	

 	

2.5	

Compliance with Other Instruments.	

3
	

 	

2.6	

Exchange Exempt Under the Securities Act.	

3
	

 	

2.7	

Financial Statements.	

3
	

 	

2.8	

Exchange Act Compliance.	

4
	

 	

2.9	

No Material Adverse Changes.	

4
	

 	

2.10	

Litigation.	

4
	

 	

2.11	

Title to Properties; Leasehold Interests.	

4
	

 	

2.12	

Environmental Compliance.	

5
	

 	

2.13	

Taxes.	

6
	

 	

2.14	

Insurance.	

6
	

 	

2.15	

Employees; ERISA.	

6
	

 	

2.16	

Legal Compliance.	

7
	

 	

2.17	

Governmental Consent.	

7
	

 	

2.18	

Investment Company.	

7
	

 	

2.19	

Internal Controls.	

7
	

III.	

REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.	

7
	

 	

3.1	

Power, Authority and Enforceability.	

7
	

 	

3.2	

Compliance with Other Instruments.	

8
	

 	

3.3	

Ownership Limitations.	

8
	

 	

3.4	

Title to Shares.	

8
	

 	

3.5	

No Commission.	

8
	

IV.	

CONDITIONS OF THE INVESTOR'S OBLIGATIONS AT CLOSING.	

8
	

 	

4.1	

Class X Preferred Articles Supplementary.	

8
	

 	

4.2	

Representations and Warranties.	

8
	 	 	 	 

i

 

	

 	

4.3	

Performance.	

8
	

 	

4.4	

No Material Adverse Change.	

9
	

 	

4.5	

Opinion of Company Counsel.	

9
	

 	

4.6	

Limited Waiver of Ownership Limitations.	

9
	

 	

4.7	

Amendment to Operating Partnership Agreement.	

9
	

 	

4.8	

Officer's Certificate.	

9
	

 	

4.9	

Proceedings.	

9
	

 	

4.10	

No Injunction.	

9
	

V.	

CONDITIONS OF THE COMPANY'S OBLIGATIONS AT CLOSING.	

10
	

 	

5.1	

Representations and Warranties.	

10
	

 	

5.2	

Performance.	

10
	

 	

5.3	

Amendment to Operating Partnership Agreement.	

10
	

 	

5.4	

No Injunction.	

10
	

 	

5.5	

Release by Investor.	

10
	

VI.	

COVENANTS.	

10
	

 	

6.1	

Filing of Exchange Act Reports.	

10
	

 	

6.2	

Consultation and Related Rights.	

10
	

 	

6.3	

Maintenance of REIT Status.	

12
	

 	

6.4	

Change of Control.	

12
	

 	

6.5	

Fixed Charge Coverage; Limitation on Issuance of Additional Preferred Shares and Indebtedness.	

14
	

 	

6.6	

No Public Disclosure.	

15
	

 	

6.7	

Participation Rights.	

15
	

 	

6.8	

Favorable Treatment.	

16
	

 	

6.9	

Ownership Restriction.	

17
	

 	

6.10	

Common Shares.	

17
	

 	

6.11	

Operating Partnership Securities.	

17
	

 	

6.12	

Additional Class X Preferred Shares.	

17
	

 	

6.13	

Parity Stock.	

17
	

 	

6.14	

Rule 144 Sales.	

18
	

 	

6.15	

Class N Preferred Shares Dividend.	

18
	

VII.	

MISCELLANEOUS	

18
	

 	

7.1	

Survival of Warranties and Covenants.	

18
	

 	

7.2	

Successors and Assigns.	

18
	 	 	 	 

ii

 

	

 	

7.3	

Governing Law.	

19
	

 	

7.4	

Counterparts.	

19
	

 	

7.5	

Titles and Subtitles.	

19
	

 	

7.6	

Notices.	

19
	

 	

7.7	

Finder's Fees.	

20
	

 	

7.8	

Expenses.	

20
	

 	

7.9	

Amendments and Waivers.	

20
	

 	

7.10	

Severability.	

20
	

 	

7.11	

Entire Agreement.	

20

 
 

EXHIBITS    
    

	Exhibit A	 	Class X Preferred Articles Supplementary
	

Exhibit B-1	
 	

Form of Opinion of Company Counsel
	

Exhibit B-2	
 	

Form of Tax Opinion of Company Counsel
	

Exhibit C	
 	

Form of Opinion of Piper Rudnick LLP
	

Exhibit D	
 	

Form of Resolution
	

Exhibit E	
 	

Form of Release
	

Exhibit F	
 	

Form of Fixed Charge Coverage Calculation
	

Exhibit G	
 	

Form of Fixed Charge Coverage Certificate

iii

 
 

EXCHANGE AGREEMENT    
    

        This EXCHANGE AGREEMENT (this "Agreement") is made as of the 29th day of September, 2004 by and among Apartment Investment and Management Company, a
Maryland corporation (the "Company"), AIMCO Properties, L.P., a Delaware limited partnership (the "Operating Partnership"), and GE Capital Equity Investments, Inc., a Delaware corporation (the
"Investor"). 

W I T N E S S E T H  

        WHEREAS, the Company has previously issued and sold to the Investor, and the Investor has previously purchased from the Company, 4,000,000 shares of
Class N Convertible Cumulative Preferred Stock, $.01 par value per share, of the Company (the "Class N Preferred Shares"), of which 2,000,000 shares have been called for redemption; and 

        WHEREAS,
the Company has authorized the issuance of 2,000,000 shares of a new class of preferred stock, par value $.01 per share, designated as "Class X Cumulative Convertible
Preferred Stock" (the "Class X Preferred Shares"), the terms of which shall be as set forth in the Class X Articles Supplementary (the "Class X Preferred Articles Supplementary")
in substantially the form of Exhibit A hereto, in accordance with and subject to the terms and conditions set forth herein; and 

        WHEREAS,
the Company desires to issue, and the Investor desires to acquire, the Class X Preferred Shares in exchange for the Class N Preferred Shares, in a transaction
exempt from registration under the Securities Act of 1933, as amended (the "Securities Act"), by Section 3(a)(9) thereunder, on the terms and subject to the conditions set forth in this
Agreement. 

        NOW,
THEREFORE, in consideration of the foregoing and the mutual covenants, agreements and warranties herein contained, the parties hereby agree as follows: 

I.    EXCHANGE OF SHARES.    

        1.1    Exchange of Shares.    

        (a)   The
Company shall adopt and file with the State Department of Assessments and Taxation of Maryland (the "SDAT") on or before the Closing Date (as defined below) the
Class X Preferred Articles Supplementary. 

        (b)   Subject
to the terms and conditions of this Agreement, the Company agrees to issue to the Investor (or one or more of its affiliates) and the Investor (either directly
or through one or more of its affiliates) agrees to acquire from the Company at the Closing (as defined below), 2,000,000 Class X Preferred Shares in exchange for the 2,000,000 issued and
outstanding Class N Preferred Shares held by the Investor, in a transaction exempt from registration under the Securities Act by Section 3(a)(9) of the Securities Act. 

        1.2    Closing.    

        The
closing (the "Closing") of the purchase and sale of the Class X Preferred Shares shall take place at the offices of Skadden, Arps, Slate, Meagher & Flom LLP, 300 S.
Grand Avenue, Suite #3400, Los Angeles, California 90071 at 9:00 a.m., Los Angeles time, on September 30, 2004, or at such other location, date and time as may be agreed upon by the
Company and the Investor (such date and time being hereinafter referred to as the "Closing Date"). At the Closing, (a) the Company shall (i) issue and deliver to the Investor a stock
certificate or certificates in definitive form, registered in the name of the Investor, representing the Class X Preferred Shares being acquired by the Investor hereunder and (ii) shall
pay an amount equal to all accrued and unpaid dividends, whether or not declared, to and including the date of Closing, on the Class N Preferred Shares in immediately available funds and
(b) the Investor shall deliver to the Company, a certificate or certificates evidencing the Class N Preferred Shares held by the Investor, endorsed in blank or accompanied by duly
executed stock powers in exchange for the certificates evidencing the Class X Preferred Shares. 

 

II.    REPRESENTATIONS AND WARRANTIES OF THE COMPANY.    

        Each
of the Company and the Operating Partnership represents and warrants, as of the date of this Agreement and as of the Closing Date, that: 

        2.1    Organization, Good Standing and Qualification.    

        (a)   The
Company has been duly organized and is validly existing as a corporation in good standing under the laws of the State of Maryland with full power and authority to
own, lease and operate its properties and conduct its business as now being conducted, and has been duly qualified to transact business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any business, so as to require such qualification, except where the failure to so qualify would not have a Material Adverse Effect.
"Material Adverse Effect" means any material adverse effect on the operations, assets, business, affairs, properties, or financial condition of the Company and its subsidiaries taken as a whole or any
event or condition that would materially impair the Company's ability to perform its obligations under this Agreement. 

        (b)   The
Operating Partnership has been duly formed and is validly existing as a limited partnership in good standing under the Delaware Revised Uniform Limited Partnership
Act with partnership power and authority to own, lease and operate its properties and conduct its business as now being conducted and has been duly qualified to transact business and is in good
standing under the laws of each jurisdiction in which it owns or leases properties, or conducts any business, so as to require such qualification, except where the failure to so qualify would not have
a Material Adverse Effect. 

        (c)   Each
subsidiary of the Company that constitutes a "significant subsidiary" (the "Subsidiaries") as defined in Rule 1-02 of
Regulation S-X of the Securities and Exchange Commission (the "Commission") has been duly organized or formed and is validly existing and in good standing under the laws of their
respective jurisdictions of incorporation or formation and has full power and authority to own, lease and operate its properties and to conduct its business as now being conducted, and each Subsidiary
has been duly qualified to transact business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties, or conducts any business, so as to require such
qualification, except where the failure to be in good standing or to so qualify would not have a Material Adverse Effect. None of the Company's other subsidiaries individually or in the aggregate
constitute a "Significant Subsidiary" as defined in Rule 1-02 of Regulation S-X. 

        2.2    Power, Authority and Enforceability.    

        (a)   The
Company has all requisite power and authority, and, prior to the Closing Date, shall have taken all required action necessary, to execute, deliver and perform this
Agreement and to issue the Class X Preferred Shares as herein provided. 

        (b)   This
Agreement has been duly executed and delivered by the Company and constitutes the legal, valid and binding obligation of the Company enforceable against the Company
in accordance with its terms, except as may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general application affecting enforcement of
creditors' rights generally, and (ii) laws relating to the availability of specific performance, injunctive relief, or other equitable remedies. 

        2.3    Capitalization.    

        Subject
to the Company's adoption of the Class X Preferred Articles Supplementary and the adoption of Articles Supplementary relating to the Company's Class V Cumulative
Preferred Stock and Class W Cumulative Convertible Preferred Stock, the authorized capital stock of the Company consists of (a) 436,962,738 shares of the Company's Class A Common
Stock, par value $.01 per share (the "Common Stock"); and (b) 73,624,762 shares of the Company's Preferred Stock, par value $.01 per 

2

 

share.
All of the issued and outstanding shares of capital stock of the Company have been duly and validly authorized and issued and are fully paid and are nonassessable. 

        2.4    Valid Issuance of Shares.    

        The
Class X Preferred Shares which are being acquired by the Investor hereunder, when issued, sold and delivered in accordance with the terms hereof in exchange for the
Class N Preferred Shares, will be duly and validly issued, fully paid and nonassessable and will be issued in compliance with all applicable federal and state securities laws. The shares of
Common Stock issuable upon the conversion of the Class X Preferred Shares (the "Common Shares") issued hereunder will be duly and validly reserved for such issuance (based upon the initial
conversion price thereof) and, when issued upon such conversion in accordance with the Class X Preferred Articles Supplementary, will be duly and validly issued, fully paid and nonassessable
and will be issued in compliance with all applicable federal and state securities laws. 

        2.5    Compliance with Other Instruments.    

        The
execution, delivery and performance of this Agreement by the Company and the Operating Partnership and the consummation by the Company and the Operating Partnership of the
transactions contemplated hereby do not (i) result in a violation of the Company's Charter, as amended to date (the "Charter"), or the Company's Amended and Restated Bylaws, as amended to date
(the "Bylaws"), (ii) subject to the effectiveness of the amendment referred to in Sections 4.7 and 5.3, result in a violation of the Operating Partnership's Agreement of Limited Partnership, or
(iii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its Subsidiaries is a party, or result in a violation of any law, rule, regulation, order,
judgment or decree applicable to the Company, any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound or affected (except for such conflicts,
defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse
Effect or impair the Company's ability to perform in all material respects its obligations under this Agreement). 

        2.6    Exchange Exempt Under the Securities Act.    

        Assuming
the accuracy of the Investor's representation in Section 3.5 hereof, the exchange of the Class X Preferred Shares for the Class N Preferred Shares as
contemplated by this Agreement is exempt from registration under the Securities Act in reliance upon Section 3(a)(9) of the Securities Act. 

        2.7    Financial Statements.    

        The
financial statements and supporting schedules included in the Company's periodic filings filed pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), are
complete and correct in all material respects and present fairly the consolidated financial position of the Company and its consolidated Subsidiaries as of the dates specified and the consolidated
results of their operations for the periods specified; such financial statements were prepared in conformity with generally accepted accounting principles applied on a consistent basis during the
periods involved, except as indicated therein or in the notes thereto. Neither the Company nor any of its Subsidiaries has any material liability (whether accrued, absolute, contingent, unliquidated
or otherwise, whether or not known to the Company, whether due or to become due), other than: (i) liabilities disclosed in an Exchange Act Report (as defined below), including the notes
thereto; (ii) liabilities that have arisen after the date of the last Exchange Act Report in the ordinary course of business or in connection with the transactions described in this Agreement;
and (iii) liabilities which do not have and are not reasonably likely to have a Material Adverse Effect. 

3

 

        2.8    Exchange Act Compliance.    

        The
Company has timely filed all documents required to be filed with the Commission pursuant to the Securities Act and the Exchange Act. All such documents, when so filed, complied in
form and substance with such acts and did not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading. 

        2.9    No Material Adverse Changes.    

        Since
the date that the Company filed its most recent annual report on Form 10-K pursuant to the Exchange Act, except as stated in, or contemplated by, such annual
report or by any other report filed by the Company under the Exchange Act since such date through the date hereof (collectively, the "Exchange Act Reports") or this Agreement: (i) there has
been no material adverse change in the business, operations or financial condition, of the Company and its Subsidiaries considered as one enterprise, or in the earnings or the ability to continue to
conduct business in the usual and ordinary course of the Company and its Subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business; (ii) except for
the transactions contemplated by this Agreement or disclosed in the Exchange Act Reports, there has been no material transaction entered into by the Company or any of its Subsidiaries other than
(a) transactions in the ordinary course of business or (b) transactions which are not material in relation to the Company and its Subsidiaries considered as one enterprise;
(iii) there have not been any changes in the capital stock (except as set forth in Section 2.3) or any material increases in the debt of the Company or any of its Subsidiaries; and
(iv) there has been no actual or, to the knowledge of the Company, threatened revocation of, or default under, any material contract to which the Company, the Operating Partnership or any other
of the Company's subsidiaries is a party, which could reasonably be expected to result in a Material Adverse Effect. 

        2.10    Litigation.    

        Except
as set forth in any Exchange Act Report, there is no action, suit or proceeding (whether or not purportedly on behalf of the Company or any of its Subsidiaries) before or by any
court or governmental agency or body, domestic or foreign, now pending or, to the knowledge of the Company, threatened against or affecting the Company or any of its Subsidiaries, which either alone
or in the aggregate, could reasonably be expected to have a Material Adverse Effect or materially impair the Company's consummation of the transactions contemplated by this Agreement or the compliance
by the Company with the terms, conditions and provisions of the Class X Preferred Shares. 

        2.11    Title to Properties; Leasehold Interests.    

        (a)   Except
as disclosed in the Exchange Act Reports, or except to the extent that the inaccuracy of any of the following, either individually or in the aggregate, would not
have a Material Adverse Effect: (i) the Company, through one or more Subsidiaries, has good and marketable title to all real properties and all other assets that are required for the effective
operation of the Company's business in the manner in which they currently are operated, in each case, subject only to Permitted Exceptions (as herein defined); (ii) all leases under which the
Company, or any of its Subsidiaries leases any property that is material to the business of the Company and its Subsidiaries taken as a whole is in full force and effect, and neither the Company nor
any such Subsidiary is in default in any material respect of any of the terms or provisions of any of such leases and to the Company's knowledge no claim has been asserted by anyone adverse to any
such entity's rights as lessee under any of such leases, or affecting or questioning any such entity's right to the continued possession or use of the properties under any such leases or asserting a
default under any such leases; and (iii) all liens, charges or encumbrances on or affecting any of the property and assets of the Company and its Subsidiaries which 

4

 

are
required to be disclosed in the Company's periodic reports filed pursuant to Exchange Act are disclosed therein. 

        (b)   As
used in this Agreement, "Permitted Exceptions" means: (i) real estate taxes and assessments not yet delinquent; (ii) covenants, restrictions, easements
and other similar agreements, provided that the same are not violated in any material respect by existing improvements or the current use and operation of the Company's or any Subsidiary's property;
(iii) zoning laws, ordinances and regulations, building codes, rules and other governmental laws, regulations, rules and orders affecting any of the Company's or any Subsidiary's property,
provided that the same are not violated in any material respect by existing improvements or the current use and operation of such property; (iv) any imperfection of title which does not
materially and adversely affect the current use, operation or enjoyment of any of the Company's or any Subsidiary's real property and does not render title to such real property unmarketable or
uninsurable and does not materially impair the value of such property; and (v) mortgage financing disclosed in any Exchange Act Report. 

        2.12    Environmental Compliance.    

        (a)   Except
as disclosed in any Exchange Act Report, the Company and each of its Subsidiaries has complied and is in compliance in all material respects with all
Environmental Statutes (as hereinafter defined), except where noncompliance would not reasonably be expected to have a Material Adverse Effect. 

        (b)   Neither
the Company nor any of its Subsidiaries intends to use any real property owned or occupied by any such party for the purpose of handling, burying, storing,
retaining, refining, transporting, processing, manufacturing, generating, producing, spilling, seeping, leaking, escaping, leaching, pumping, pouring, emitting, emptying, discharging, injecting,
dumping, transferring or otherwise disposing of or dealing with Hazardous Materials (except as may be incidental to the ordinary use of such property by the Company and its Subsidiaries consistent
with past practice). 

        (c)   Except
as would not, individually or in the aggregate, have a Material Adverse Effect, neither the Company nor any of its Subsidiaries is aware of any seepage, leak,
escape, leach, discharge, injection, release, emission, spill, pumping, pouring, emptying or dumping of Hazardous Materials into waters on or adjacent to any real property owned or occupied by any
such party, or onto lands from which Hazardous Materials might reasonably be expected to seep, flow or drain into such waters. 

        (d)   Except
as would not, individually or in the aggregate, have a Material Adverse Effect, the Company is not aware of any occurrence or circumstance that, with notice or
passage of time or both, would give rise to a claim under or pursuant to any federal, state or local Environmental Statute pertaining to Hazardous Materials on or originating from any real property
owned or occupied by the Company or any of its Subsidiaries arising out of the conduct of any such party, including without limitation pursuant to any Environmental Statute. 

        (e)   No
land owned by the Company or any of its Subsidiaries is included or to the knowledge of the Company proposed for inclusion on the National Priorities List issued
pursuant to CERCLA (as hereinafter defined) by the United States Environmental Protection Agency (the "EPA") and has not otherwise been publicly identified by the EPA by notice to the Company as a
potential CERCLA site or included or, to the knowledge of the Company, proposed for inclusion on any list or inventory issued pursuant to any other Environmental Statute or issued by any other
Governmental Authority (as hereinafter defined). 

        (f)    As
used herein, "Hazardous Material" shall include without limitation any flammable explosives, radioactive materials, hazardous materials, hazardous wastes, toxic
substances or related materials, asbestos or any hazardous material as defined by any federal, state or local environmental law, ordinance, rule or regulation, including without limitation the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. §§ 9601 et seq.

5

 

("CERCLA"),
the Hazardous Materials Transportation Act, as amended, 49 U.S.C. §§ 1801 et seq., the Resource Conservation and
Recovery Act, as amended, 42 U.S.C. §§ 9601 et seq., the Emergency Planning and Community Right-to-Know
Act of 1986, 42 U.S.C. §§ 11001 et seq., the Toxic Substances Control Act, 15 U.S.C. §§ 2601  et seq., the Federal Insecticide,
Fungicide and Rodenticide Act, 7 U.S.C. §§ 136 et
seq., the Clean Air Act, 42 U.S.C. §§ 7401 et seq., the Clean Water Act (Federal Water Pollution Control
Act), 33 U.S.C. §§ 1251 et seq., the Safe Drinking Water Act, 42 U.S.C. §§ 300F to 300j-11,
and the Occupational Safety and Health Act, 29 U.S.C. §§ 651 et seq., as any of the above statutes may be amended from time to
time, and in the regulations adopted and publications promulgated pursuant to each of the foregoing (individually, an "Environmental Statute") or by any federal, state or local governmental authority
having or claiming jurisdiction over the properties and assets described in the Company's periodic reports filed pursuant to the Exchange Act (a "Governmental Authority"). 

        2.13    Taxes.    

        (a)   The
Company and its Subsidiaries have filed or caused to be filed all federal, state, local, foreign and other tax returns, reports, information returns and statements
(except for returns, reports, information returns and statements the failure to file which will not result in any Material Adverse Effect) required to be filed by them. The Company and its
Subsidiaries have paid or caused to be paid all taxes (including interest and penalties) that are shown as due and payable on such returns or claimed in writing by any taxing authority to be due and
payable with respect to such returns, except those which are being contested by them in good faith by appropriate proceedings and in respect of which adequate reserves are being maintained on their
books in accordance with generally accepted accounting principles consistently applied. The Company and its Subsidiaries do not have any material liabilities for taxes other than those incurred in the
ordinary course of business and in respect of which adequate reserves are being maintained by it in accordance with generally accepted accounting principles consistently applied. Federal and state
income tax returns for the Company and its Subsidiaries are not currently under examination or audit by the Internal Revenue Service or state authorities except that various state income tax returns
of the Company and/or subsidiaries are currently under examination. No deficiency assessment with respect to or proposed adjustment of the Company's or any of its Subsidiaries' federal, state, local,
foreign or other tax returns is pending or, to the best of the Company's or any of its Subsidiaries' knowledge, threatened in writing. There is no tax lien, whether imposed by any federal, state,
local or other tax authority, outstanding against the assets, properties or business of the Company other than statutory liens in respect of taxes that are not delinquent. There are no applicable
taxes, fees or other governmental charges payable by the Company or any of its Subsidiaries in connection with the execution and delivery of this Agreement or the issuance by the Company of the
Class X Preferred Shares or the Common Shares. 

        (b)   The
Company is a real estate investment trust and has qualified to be taxed as a real estate investment trust pursuant to Sections 856 through 860 of the Internal
Revenue Code, as amended (the "Code"), for its taxable years ended December 31, 1994 through December 31, 2003, and the Company expects under present law to so qualify for the fiscal
year ending December 31, 2004 and in the future. 

        2.14    Insurance.    

        The
Company and its Subsidiaries each carry or is entitled to the benefits of insurance in such amounts and covering such risks as is reasonably sufficient under the circumstances or is
customary in the industry and all such insurance is in full force and effect. 

        2.15    Employees; ERISA.    

        There
is no strike or work stoppage existing or, to the knowledge of the Company, threatened against the Company or its Subsidiaries. The Company does not have any knowledge as to any
intentions of any key employee or any group of employees to leave the employ of the Company where 

6

 

such
departure would have a Material Adverse Effect. The Company is in compliance with all applicable laws relating to the employment of labor, including provisions relating to wages, hours, equal
opportunity, collective bargaining and the payment of Social Security and other taxes, and with ERISA, except where the failure to so comply would not have a Material Adverse Effect. 

        2.16    Legal Compliance.    

        (a)   The
Company has complied with all applicable laws, rules, regulations, orders, licenses, judgments, writs, injunctions, decrees or demands of any court or administrative
body, domestic or foreign, or of any other governmental agency or instrumentality, domestic or foreign, except to the extent that failure to comply would not have a Material Adverse Effect. The
Company has all necessary permits, licenses and other authorizations required to conduct its business as currently conducted, and as proposed to be conducted, except where the failure to have such
permits, licenses and authorizations would not have a Material Adverse Effect. 

        (b)   Except
as disclosed in any Exchange Act Report, there are no adverse orders, judgments, writs, injunctions, decrees or demands of any court or administrative body,
domestic or foreign, or of any other governmental agency or instrumentality, domestic or foreign, outstanding against the Company which are reasonably likely to result in a Material Adverse Effect. 

        2.17    Governmental Consent.    

        Other
than such consents, approvals, authorizations, declarations and filings as have already been obtained or made or which will be made at or prior to the Closing Date, no consent,
approval or authorization of, or declaration or filing with, any governmental authority on the part of the Company is required for the valid execution and delivery of this Agreement or performance
hereunder or the valid offer, issue and delivery of the Class X Preferred Shares pursuant to this Agreement and the Class X Preferred Articles Supplementary. 

        2.18    Investment Company.    

        The
Company is not an investment company, as defined in the Investment Company Act of 1940, as amended, nor controlled by an investment company. 

        2.19    Internal Controls.    

        The
Company for itself and on behalf of each Subsidiary maintains a system of internal accounting controls sufficient to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific authorizations; (ii) transactions are recorded as necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset accountability; (iii) access to assets is permitted only in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the existing assets at reasonable intervals and appropriate action is taken with respect to any differences. 

III.    REPRESENTATIONS AND WARRANTIES OF THE INVESTOR.    

        The
Investor represents and warrants, as of the date of this Agreement and as of the Closing Date, that: 

        3.1    Power, Authority and Enforceability.    

        (a)   The
Investor has the requisite power and authority, and has taken all required action necessary, to execute, deliver and perform this Agreement and to acquire the
Class X Preferred Shares hereunder. 

        (b)   This
Agreement has been duly executed and delivered by the Investor and constitutes the legal, valid and binding obligation of the Investor enforceable in accordance
with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, and other laws of general 

7

 

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    Compliance with Other Instruments.    

        The
execution, delivery and performance of this Agreement by the Investor and the consummation by the Investor of the transactions contemplated hereby do not (i) result in a
violation of the Investor's constituent documents or (ii) conflict with, or constitute a default under (or an event which with notice or lapse of time or both would become a default), or give
to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Investor is a party, or result in a violation of any law, rule,
regulation, order, judgment or decree applicable to the Investor or by which any property or asset of the Investor is bound or affected (except for such conflicts, defaults, terminations, amendments,
accelerations, cancellations and violations as would not materially impair the Investor's ability to perform its obligations under this Agreement). 

        3.3    Ownership Limitations.    

        The
Investor has received a copy of the Company's Charter and understands the restrictions on transfer and ownership of the Company's capital stock included therein related to the
qualification by the Company as a real estate investment trust for federal income tax purposes pursuant to Sections 856 through 860 of the Code. 

        3.4    Title to Shares.    

        The
Investor holds of record and owns beneficially 2,000,000 Class N Preferred Shares, free and clear of all liens, encumbrances, claims, security interests or restrictions (other
than any restrictions under applicable securities laws) and there are no outstanding subscriptions, options, warrants, rights, contracts, understandings or agreements to purchase or otherwise acquire
the Class N Preferred Shares, except for this Agreement. 

        3.5    No Commission.    

        The
Investor has not paid any commission or other renumeration to any person for soliciting the exchange of the Class X Preferred Shares for the Class N Preferred Shares. 

IV.    CONDITIONS OF THE INVESTOR'S OBLIGATIONS AT CLOSING.    

        The
Investor's obligations to effect the Closing under this Agreement are subject to the satisfaction or waiver by the Investor on or before the Closing of each of the following
conditions: 

        4.1    Class X Preferred Articles Supplementary.    

        The
Class X Preferred Articles Supplementary shall have been filed with and accepted for recording by the SDAT. 

        4.2    Representations and Warranties.    

        The
representations and warranties of the Company contained in Article II shall be true on and as of the Closing Date with the same effect as though such representations and
warranties had been made on and as of the Closing Date. 

        4.3    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. 

8

 

        4.4    No Material Adverse Change.    

        After
the date of this Agreement and through the Closing Date, there shall not have occurred any change or event that has had a Material Adverse Effect. 

        4.5    Opinion of Company Counsel.    

        The
Investor shall have received (i) from Skadden, Arps, Slate, Meagher & Flom LLP, counsel for the Company, opinions substantially in the form attached hereto as Exhibits
B-1 and B-2 and (ii) from Piper Rudnick LLP, counsel for the Company, an opinion in the form attached hereto as Exhibit C. 

        4.6    Limited Waiver of Ownership Limitations.    

        Subject
to Section 6.9 hereof, the Board of Directors (or a duly authorized committee thereof) shall have duly adopted a resolution in the form of Exhibit D hereto, thereby
waiving the application of the Ownership Limit (as used in Section 3.4.1 (A) of Article IV of the Charter and Section 10.1 (a) of Article Third of the Class X
Preferred Articles Supplementary) to the Investor and its affiliates to the extent provided in such resolution. 

        4.7    Amendment to Operating Partnership Agreement.    

        The
limited partnership agreement of the Operating Partnership shall have been amended to authorize the general partner of the Operating Partnership to cause the Operating Partnership,
without the approval of any other partners of the Operating Partnership, to issue preferred partnership interests with economic attributes substantially identical to those of the Class X
Preferred Shares, and the general partner of the Operating Partnership shall have caused such preferred partnership interests to have been issued to the Company or a direct or indirect wholly owned
subsidiary thereof. 

        4.8    Officer's Certificate.    

        The
Company shall have delivered to the Investor on the Closing Date a certificate or certificates, signed by an authorized officer of the Company to the effect that the facts required
to exist by Sections 4.1, 4.2, 4.3, 4.4, 4.6, 4.7 and, to the knowledge of the Company, Section 4.10 exist on such Closing Date. 

        4.9    Proceedings.    

        All
proceedings to be taken in connection with the transactions contemplated by this Agreement and all documents incidental thereto, shall be reasonably satisfactory in form and
substance to the Investor; and the Investor shall have received copies of all documents which the Investor may reasonably request in connection with said transactions and copies of the records of all
proceedings of the Company in connection therewith in form and substance reasonably satisfactory to the Investor. 

        4.10    No Injunction.    

        There
shall not be in effect any order, decree or injunction of a court or agency of competent jurisdiction which enjoins or prohibits consummation of the transactions contemplated
hereby and there shall be no actual or, to the knowledge of any party hereto, threatened action, suit, arbitration, inquiry, proceedings or investigation by or before any governmental authority, court
or agency of competent jurisdiction, which would reasonably be expected to materially impair the ability of the Company or the Investor to consummate the transactions contemplated hereby or of the
Company to issue the Class X Preferred Shares. 

9

 

V.    CONDITIONS OF THE COMPANY'S OBLIGATIONS AT CLOSING.    

        The
obligations of the Company to effect the Closing under this Agreement are subject to the fulfillment on or before the Closing of each of the following conditions: 

        5.1    Representations and Warranties.    

        The
representations and warranties of the Investor contained in Article III shall be true on and as of the Closing Date with the same effect as though such representations and
warranties had been made on and as of the Closing Date. 

        5.2    Performance.    

        The
Investor 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. 

        5.3    Amendment to Operating Partnership Agreement.    

        The
limited partnership agreement of the Operating Partnership shall have been amended to authorize the general partner of the Operating Partnership to cause the Operating Partnership,
without the approval of any other partners of the Operating Partnership, to issue preferred partnership interests with economic attributes substantially identical to those of the Class X
Preferred Shares, and the
general partner of the Operating Partnership shall have caused such preferred partnership interests to have been issued to the Company. 

        5.4    No Injunction.    

        There
shall not be in effect any order, decree or injunction of a court or agency of competent jurisdiction which enjoins or prohibits consummation of the transactions contemplated
hereby and there shall be no actual or, to the knowledge of any party hereto, threatened action, suit, arbitration, inquiry, proceedings or investigation by or before any governmental authority, court
or agency of competent jurisdiction, which would reasonably be expected to materially impair the ability of the Company or the Investor to consummate the transactions contemplated hereby or of the
Company to issue the Class X Preferred Shares. 

        5.5    Release by Investor.    

        The
Investor shall have delivered to the Company a release substantially in the form of Exhibit E that releases the Company from liability for its failure to comply with
Section 7.10 of the Subscription Agreement, dated as of September 12, 2000, by and between the Company and the Investor (the "Class N Purchase Agreement"). 

VI.    COVENANTS.    

        6.1    Filing of Exchange Act Reports.    

        After
the date of this Agreement, the Company will timely file all documents required to be filed with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange
Act, and so long as any of the Class X Preferred Shares or the Common Shares remain issued and outstanding, shall provide to the Investor copies of all such documents, including, without
limitation, all financial statements of the Company required to be filed with the Commission, except to the extent that such documents are available through the Commission's EDGAR system. 

        6.2    Consultation and Related Rights.    

        Until
the earlier of (i) three years following the Closing Date or (ii) the date on which the Investor ceases to hold any Class X Preferred Shares, the Investor
shall have the right to directly 

10

 

participate
(within the meaning of 29 CFR 2510.3 101(d)(3)(ii)) in the management of the Company through and by the following rights and powers: 

        (a)   The
right to be consulted on the appointment and dismissal of (i) the chief operating officer and the chief financial officer, or any person or persons fulfilling
similar duties, and the auditors and accountants for the Company and (ii) the General Partner, the chief operating officer and the chief financial officer, or any person or persons fulfilling
similar duties, and the auditors and accountants for the Operating Partnership. 

        (b)   The
right to inspect the books and records of the Company and the Operating Partnership; provided, that all costs and
expenses of such inspection shall be borne by the Investor; and provided, further, that the Investor
shall keep such information confidential, except that the Investor may disclose such information to its employees and advisors as necessary in the management and operation of the Investor's business
and investment in the Company and that, upon reasonable prior notice to the Company, the Investor may disclose such information as required by law. 

        (c)   The
right to be consulted concerning the development of the Company's and the Operating Partnership's annual strategic plan that incorporates a specific business
strategy, an operating agenda, investment and the disposition objectives, and capitalization and funding strategies. 

        (d)   The
right to be consulted concerning Major Transactions. "Major Transactions" means (i) any acquisition or disposition of any assets in any single transaction or
any series of related transactions where the aggregate purchase price paid or received by the Company or the Operating Partnership exceeds $100,000,000 but not including asset transfers between or
among the Company and any of its subsidiaries respecting which the Company has direct or indirect majority ownership or management control (including any such subsidiaries who are not consolidated
with the Company for financial reporting purposes) or between or among such subsidiaries, (ii) a determination by the Company's Board of Directors to terminate the Company's status as a real
estate investment trust pursuant to Sections 856 through 860 of the Code, (iii) any Change of Control (as defined in Section 6.4) initiated by the Company and in the response to any
Change of Control not initiated by the Company and (iv) a determination by the Operating Partnership's General Partner to terminate the Operating Partnership's status as a limited partnership. 

From
time to time, the Investor may notify the Company that it desires to exercise a right or rights specified in paragraphs (a) through (d) above. Upon receipt of such notice and for
90 days thereafter, the Company shall notify the Investor of any of the foregoing proposed actions for its consideration that relate to the rights so exercised by the Investor, together with
information which sets forth in reasonable detail the background and reasons for such action, reasonably in advance (but in no event less than five business days) of the date any action would be
required to be taken by or on behalf of the Company to permit the Investor to review the information and to provide its views to the Company. If the Investor exercises its right to be consulted
concerning the development and preparation of the Company's annual operating budget and strategic plan, the Company shall present to the Investor a reasonably detailed operating budget and strategic
plan for the upcoming calendar year of the Company. Notwithstanding the foregoing, the Company (i) shall not have any obligation to comply with any advice offered by the Investor in any
consultation pursuant to this Section 6.2 (and the provisions of this Section 6.2 shall not be construed to create any approval rights over any matters) and (ii) will not be
required to disclose material information to the Investor if, in the reasonable judgment of the Company, such disclosure would (a) require any public disclosure thereof or (b) jeopardize
any proposed transaction. 

11

 

        6.3    Maintenance of REIT Status.    

        (a)   So
long as any of the Class X Preferred Shares or the Common Shares remain issued and outstanding, the Company shall use its reasonable best efforts to continue
to be taxed as a real estate investment trust pursuant to Sections 856 through 860 of the Code. 

        (b)   If
the Company shall fail to continue to be taxed as a real estate investment trust pursuant to Sections 856 through 860 of the Code (a "REIT-Repurchase
Event"), the Investor shall have the right to require the Company, to the extent the Company shall have funds legally available therefor, to repurchase any or all of the Class X Preferred
Shares held by the Investor at a repurchase price payable in cash in an amount equal to 105% of the liquidation preference thereof, plus accrued and unpaid dividends whether or not declared, if any
(the "REIT-Repurchase Payment"), to the date of repurchase or the date payment is made available (the "REIT-Repurchase Date"), pursuant to the offer described in subsection
(c) below (the "REIT-Repurchase Offer"). 

        (c)   Within
15 days following the Company becoming aware that a REIT-Repurchase Event has occurred, the Company shall mail by recognized overnight courier
a notice to the Investor stating (i) that a REIT-Repurchase Event has occurred and that the Investor has the right to require the Company to repurchase any or all Class X
Preferred Shares then held by the Investor in cash, (ii) the date of repurchase (which shall be a business day, no earlier than 30 days and no later than 60 days from the date
such notice is mailed, or such later date as may be necessary to comply with applicable law), (iii) the repurchase price and (iv) the instructions determined by the
Company, consistent with this subsection, that the Investor must follow in order to have its Class X Preferred Shares repurchased. 

        (d)   On
the REIT-Repurchase Date, the Company will, to the extent lawful, accept for payment Class X Preferred Shares or portions thereof delivered to the
Company pursuant to the REIT-Repurchase Offer and promptly mail by recognized overnight courier or by wire transfer of immediately available funds to the Investor, as directed by the
Investor, in an amount equal to the REIT-Repurchase Payment in respect of all Class X Preferred Shares or portions thereof so delivered. 

        (e)   Notwithstanding
anything else herein, to the extent they are applicable to any REIT-Repurchase Offer, the Company will comply with any federal and state
securities laws, rules and regulations and all time periods and requirements shall be adjusted accordingly. 

        6.4    Change of Control    

        (a)   If
a Change of Control occurs, the Company shall, in its sole discretion, make an election to effect one of the following: (i) to the extent the Company shall
have funds legally available therefor, the Company may offer to repurchase all of the Investor's Class X Preferred Shares at a repurchase price payable in cash in an amount equal to
(x) if the repurchase occurs on or prior to March 31, 2006, 102% of the liquidation preference thereof, or (y) if the repurchase occurs after March 31, 2006, 100% of the
liquidation preference thereof, plus, in either case, accrued and unpaid dividends whether or not declared, if any (the "Repurchase Payment"), to the date of repurchase or the date payment is made
available (the "Repurchase Date"), pursuant to the offer described in subsection (b) below (the "Repurchase Offer"), or (ii) the Company shall increase the Base Rate (as defined in the
Class X Preferred Articles Supplementary) as contemplated by the definition of "Base Rate" contained in the Class X Preferred Articles Supplementary (a "Dividend Increase"). 

        (b)   Within
15 days following the Company becoming aware that a Change of Control has occurred, if the Company elects to make a Repurchase Offer, the Company shall
mail by recognized overnight courier a notice to the Investor stating (i) that a Change of Control has 

12

 

occurred
and that the Investor has the right to require the Company to repurchase any or all Class X Preferred Shares then held by the Investor in cash, (ii) the date of repurchase
(which shall be a business day, no earlier than 30 days and no later than 60 days from the date such notice is mailed, or such later date as may be necessary to comply with the
requirements of the Exchange Act), (iii) the repurchase price for the repurchase and (iv) the instructions determined by the Company, consistent with this subsection, that the Investor
must follow in order to have its Class X Preferred Shares repurchased. If the Company elects to make a Repurchase Offer, then on the Repurchase Date, the Company will, to the extent lawful,
accept for payment Class X Preferred Shares or portions thereof delivered to the Company pursuant to the Repurchase Offer and promptly mail by recognized overnight courier or by wire transfer
of immediately available funds to the Investor, as directed by the Investor, payment in an amount equal to the Repurchase Payment in respect of all Class X Preferred Shares or portions thereof
so delivered. To the extent that the Company cannot lawfully accept for payment any Class X Preferred Shares or portions thereof delivered to the Company pursuant to the Repurchase Offer, the
Company shall effect a Dividend Increase with respect to such Class X Preferred Shares with the date of the notice mailed pursuant to this Section 6.4(b) being the date of the notice for
purposes of calculating the Base Rate pursuant to the Class X Preferred Articles Supplementary. 

        (c)   Within
15 days following the Company becoming aware that a Change of Control has occurred, if the Company elects to make a Dividend Increase, the Company shall
mail by recognized overnight courier a notice to the Investor stating that a Change of Control has occurred and that the Company has elected to increase the Base Rate as contemplated by the definition
of "Base Rate" contained in the Class X Preferred Articles Supplementary. 

        (d)   Notwithstanding
anything else herein, to the extent they are applicable to any Repurchase Offer, the Company will comply with any federal and state securities laws,
rules and regulations and all time periods and requirements shall be adjusted accordingly. 

        (e)   "Change
of Control" means each occurrence of any of the following: (i) the acquisition, directly or indirectly, by any individual or entity or group (as such term
is used in Section 13(d)(3) of the Exchange Act) (other than the Investor or any of its affiliates) of beneficial ownership (as defined in Rule 13d 3 under the Exchange Act, except that
such individual or entity shall be deemed to have beneficial ownership of all shares that any such individual or entity has the right to acquire, whether such right is exercisable immediately or only
after passage of time) of more than 25% of the Company's outstanding capital stock with voting power, under ordinary circumstances to elect directors of the Company; (ii) other than with
respect to the election, resignation or replacement of any director designated, appointed or elected by the holders of the Class X Preferred Stock (each a "Preferred Director"), during any
period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of the Company (together with any new directors whose election by such Board of
Directors or whose nomination for election by the shareholders of the Company was approved by a vote of 662/3% of the directors of the Company (excluding Preferred Directors) (the
"Incumbent Board") then still in office who were either directors at the beginning of such period, or whose election or nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of Directors the Company then in office; (iii) the Company or one of its Subsidiaries is not the general partner of the Operating Partnership; or
(iv) (A) the Company consolidating with or merging into another entity or conveying, transferring or leasing all or substantially all of its assets (including, but not limited to, real
property investments) to any individual or entity, or (B) any corporation consolidating with or merging into the Company, which in either event (A) or (B) is pursuant to a
transaction in which the outstanding voting capital stock of the Company is reclassified or changed into or exchanged for cash, securities or other property; provided, however, that the events
described in clause (iv) shall not be deemed to be a Change of Control (a) if the 

13

 

sole
purpose of such event is that the Company is seeking to change its domicile or to change its form of organization from a corporation to a statutory business trust or (b) if (x) the
holders of the exchanged securities of the Company immediately after such transaction beneficially own at least a majority of the securities of the merged or consolidated entity normally entitled to
vote in elections of directs, (y) the chairman and the president of the Company immediately prior to the execution of the transaction agreement are the chairman and the president of the merged
or consolidated company, and (z) the individuals who were members of the incumbent Board immediately prior to the execution of the transaction agreement constitute at least a majority of the
member of the board of directs of the merged or consolidated company. 

        6.5    Fixed Charge Coverage; Limitation on Issuance of Additional Preferred Shares and
Indebtedness.    

        (a)   So
long as the Investor owns Class X Preferred Shares with an aggregate liquidation preference of at least $25 million, without the written consent of the
Investor, none of the Company, the Operating Partnership or any other subsidiary of the Company may issue any preferred securities of such entity or incur any additional indebtedness for borrowed
money if the Company's ratio of aggregate EBITDA to aggregate Fixed Charges (calculated in a manner substantially similar to the calculation set forth on Exhibit F hereto) for the four fiscal
quarters immediately preceding such issuance was less than (i) 1.4 to 1, if such issuance occurs on or prior to March 31, 2006, or (ii) 1.5 to 1, if such issuance occurs after
March 31, 2006; provided, however, that the Company, the Operating Partnership and any other subsidiary of the Company may issue preferred securities or incur additional indebtedness if the pro
forma effect of such issuance or incurrence, after taking into account the application of the proceeds of
such issuance or incurrence, would result in an increase in such ratio. If, as a result of the foregoing, an issuance of preferred securities or incurrence of indebtedness would be prohibited without
the written consent of the Investor, the Company may request, in writing, that the Investor provide such consent within seven days. If the Investor fails to provide such written consent within seven
days of such request, a "Coverage Event" shall be deemed to have occurred and the Company shall have the right, exercisable at any time during the 60 days thereafter, to redeem the
Class X Preferred Shares pursuant to the Class X Preferred Articles Supplementary. 

        (b)   Within
45 days after the end of each quarter, the Company shall provide to Investor a certificate of the Company's chief financial officer, in substantially the
form of Exhibit G hereto, certifying that the Company has complied with the covenant contained in Section 6.5(a) of this Agreement as of the last issuance of preferred securities or the
incurrence of any additional indebtedness for borrowed money to occur during the quarter and which also provides a calculation in sufficient detail to support such conclusion. 

        (c)   "EBITDA"
for any period means the consolidated net income of the Company (before extraordinary income or gains) as reported in the Company's financial statements filed
with the Securities and Exchange Commission (A) increased by the sum of the Company's share of the following (without duplication): 

          (i)  all
income and state franchise taxes paid or accrued according to Generally Accepted Accounting Principals ("GAAP") for such period (other than income taxes
attributable to extraordinary, unusual or non-recurring gains or losses except to the extent that such gains were not included in EBITDA), 

         (ii)  all
interest expense paid or accrued in accordance with GAAP for such period (including financing fees and amortization of deferred financing fees and amortization of
original issue discount), 

        (iii)  depreciation
and depletion reflected in such reported net income, 

14

 

        (iv)  amortization
reflected in such reported net income including, without limitation, amortization of capitalized debt issuance costs (only to the extent that such amounts
have not been previously included in the amount of EBITDA pursuant to clause (ii) above), goodwill, other intangibles and management fees, and 

         (v)  any
other non-cash charges or discretionary prepayment penalties, to the extent deducted from consolidated net income (including, but not limited to, income
allocated to minority interests); and 

        (B)  decreased
by an amount equal to $350 per year multiplied by the average number of the Company's ownership-adjusted share of apartment units during such period. 

        (d)   "Consolidated
Fixed Charges" for any period means the sum of the Company's share of the following: 

          (i)  all
interest expense paid or accrued in accordance with GAAP for such period (excluding financing fees and amortization of deferred financing fees and amortization of
original issue discount), 

         (ii)  preferred
stock dividend requirements for such period, whether or not declared or paid, and 

        (iii)  regularly
scheduled amortization of principal during such period (other than any balloon payments at maturity). 

        6.6    No Public Disclosure.    

        Neither
party to this Agreement, nor any affiliate of such party, will make any public disclosure concerning the transactions contemplated by this Agreement unless each of the parties
hereto has been provided with a reasonable time to review such disclosure. Each party agrees that the Company may disclose the transactions contemplated by this Agreement in filings with the
Commission and the New York Stock Exchange; provided that the Investor shall have been provided a reasonable time to review, and consult with the Company regarding, the disclosure. 

        6.7    Participation Rights.    

        (a)   (i)
Subject to Section 6.9, if, during the 90 days immediately following the Closing Date, the Company grants, issues, sells, or agrees to grant issue or
sell any preferred stock or preferred units of the Operating Partnership or any debt that is convertible into, or exchangeable for, equity securities of the Company or the Operating Partnership other
than securities (the "Participation Securities"), issued in exchange for the Class O Cumulative Convertible Preferred Stock, par value $.01 per share (the "Class O Preferred Stock"), for
a consideration consisting solely of cash in a non-underwritten offering, then the Investor shall be entitled to purchase, upon the
same terms and conditions as the other investors, an amount of Participation Securities equal to the lesser of (i) $100 million or (ii) the amount of the Participation Securities
that are being purchased by the single largest investor (including its affiliates). 

         (ii)  In
connection with any issuance of Participation Securities, the Company shall either, (x) at least 10 business days prior to any such proposed issuance or sale
of Participation Securities, mail by recognized overnight courier a notice to the Investor stating (i) that a proposed sale will occur and that the Investor has the right to participate
pursuant to the provisions in subsection (a) above, (ii) the date of the proposed closing of the sale, (iii) the amount of Participation Securities that the Investor has the right
to purchase, and (iv) the instructions determined by the Company, consistent with this Section 6.7, that the Investor must follow in order to purchase the Participation Securities on the
same terms and conditions as the other investors, including the anticipated closing date for such issuance, or (y) within 2 

15

 

business
days after an issuance or sale of Participation Securities, mail by recognized overnight courier a notice to the Investor stating (i) that a sale has occurred and that the Investor has
the right to purchase securities equivalent to the Participation Securities ("Equivalent Securities") pursuant to the provisions in subsection (a) above, (ii) the date of the closing of
the sale, (iii) the amount of Equivalent Securities that the Investor has the right to purchase, and (iv) the instructions determined by the Company, consistent with this
Section 6.7, that the Investor must follow in order to purchase the Equivalent Securities on the same terms and conditions as the other investors. 

        (iii)  Within
5 business days after receiving the notice contemplated by clause (x) of subsection (a)(ii) above, the Investor must send a notice to the Company
stating the amount of Participation Securities it elects to purchase. If the Investor fails to so notify the Company within such 5 business day period, the Investor shall have waived its right to
purchase such Participation Securities under this Section 6.7. 

        (iv)  Within
10 business days after receiving the notice contemplated by clause (y) of subsection (a)(ii) above, the Investor must send a notice to the Company
stating the amount of Equivalent Securities it elects to purchase. If the Investor fails to so notify the Company within such 10 business day period, the Investor shall have waived its right to
purchase such Equivalent Securities under this Section 6.7. 

        (b)   (i)
Subject to Section 6.9, if, during the 90 days immediately following the Closing Date, the Company intends to issue and sell any preferred stock or
preferred units of the Operating Partnership or any debt that is convertible into, or exchangeable for, equity securities of the Company or the Operating Partnership (the "Underwritten Securities"),
for a consideration consisting solely of cash in an underwritten offering, then the Investor shall be entitled to purchase Underwritten Securities in accordance with this subsection (b), upon the same
terms and conditions as the other investors in the underwritten offering. 

         (ii)  In
connection with any issuance of Underwritten Securities, the Company and the underwriters of the underwritten offering shall notify the Investor of the Company's
intent to issue Underwritten Securities prior to approaching any other potential investor. If the Investor desires to purchase Underwritten Securities in the underwritten offering, the Investor shall
respond to the Company and the underwriters of the underwritten offering with an order for Underwritten Securities on or prior to the deadline set by the underwriters for responses by potential
investors. If the Underwritten Securities are priced at a price equal to or less than the price in the Investor's order or if the Underwritten Securities have a dividend yield or interest rate equal
to or greater than the dividend yield or interest rate set forth in the Investor's order, the Company shall direct the underwriters of the underwritten offering to allocate an amount of Underwritten
Securities to the Investor equal to the lesser of (A) the amount of the Investor's order, (B) $50.0 million or (C) the total amount of Underwritten Securities that are
being issued in the underwritten offering. 

        6.8    Favorable Treatment.    

        If,
during the 60 days immediately following the date hereof, there is any change to any of the material terms of the Articles Supplementary relating to the Class O
Preferred Stock or if any securities issued in exchange for the Class O Preferred Stock have material terms different from those contained in the Class O Preferred Stock on the date
hereof, and such difference results in improved material terms for the holder of those securities (which may include, without limitation, a lower conversion, exchange, exercise or strike price per
share, as the case may be, longer period of no-call protection, better financial or other covenants, greater dividend rate, greater liquidation preference, greater redemption payments,
greater conversion rate, priority ranking or a greater change of control price), then the Company shall immediately notify the Investor in writing of such difference. The 

16

 

Investor
shall have 10 business days following receipt of such notice to notify the Company that the Investor elects to (i) exchange all, but not a portion, of the Class X Preferred
Shares owned by the Investor and its affiliates for, at the Investor's option, either (A) shares of Class O Preferred Stock or the securities issued in exchange for the shares of
Class O Preferred Stock or (B) a new class of securities with terms equivalent to those of the Class X Preferred Shares and incorporating such improved terms, in either case with
a value equal to the aggregate liquidation preference of the Class X Preferred Shares exchanged, plus accumulated and unpaid dividends thereon to the date of the exchange, and/or
(ii) amend this Agreement so that the Investor's rights and obligations hereunder include such improved terms. Within 10 business days after receipt of notice from the Investor of such
election, the Company shall effect such exchange and/or amendment. The Company hereby covenants to take all such actions as are reasonably necessary to effect such exchange and amendment in accordance
herewith. 

        6.9    Ownership Restriction.    

        None
of the Investor nor any of its controlled affiliates will, either individually or in the aggregate, directly own (excluding beneficial ownership pursuant to outstanding conversion
or similar rights) more than 9.8% of the Common Stock at any time outstanding. As used in this Section 6.9, "controlled affiliate" means any person that is controlled by the Investor, as
applicable, and "control" means the ownership of a majority of the voting securities of such person, the ability to elect a majority of the directors of such person or the ability to control such
person through contractual means. 

        6.10    Common Shares.    

        The
Company covenants and agrees that it shall at all times reserve and keep available, free from preemptive rights, out of the aggregate of its authorized but unissued Common Shares
solely for the purpose of effecting conversion of the Class X Preferred Shares as provided in the Class X Preferred Articles Supplementary, the full number of Common Shares as shall then
be deliverable upon the conversion of all outstanding Class X Preferred Shares not theretofore converted into Common Shares. Such Common Shares shall, when issued or delivered in accordance
with the Class X Preferred Articles Supplementary, be validly issued and fully paid and non-assessable. The Company covenants and agrees that it shall cause the Common Shares
deliverable upon conversion of the Class X Preferred Shares to be listed on each securities exchange or quoted on each interdealer quotation system, if any, on which similar securities issued
by the Company are then listed or quoted, no later than the date of such conversion. 

        6.11    Operating Partnership Securities.    

        The
Company shall cause the Operating Partnership to issue preferred partnership interests with economic attributes substantially identical to those of the Class X Preferred
Shares to the Company or a direct or indirect wholly owned subsidiary thereof and the Company shall cause the Operating Partnership to keep such partnership interests outstanding for so long as the
Class X Preferred Shares are outstanding. 

        6.12    Additional Class X Preferred Shares.    

        The
Company covenants and agrees that it shall not issue any additional Class X Preferred Shares to any party other than the Investor without the Investor's prior written consent. 

        6.13    Parity Stock.    

        So
long as the Investor owns at least a majority of the then outstanding Class X Preferred Shares, if the Company proposes to take any action pursuant to the last paragraph of
Section 3 of Article Third of the Class X Preferred Articles Supplementary, the opinion required to be delivered thereunder shall be delivered by a nationally recognized REIT tax counsel
reasonably acceptable to the Investor. 

17

 

        6.14    Rule 144 Sales.    

        (a)   The
Company covenants that it will file the reports required to be filed by the Company under the Exchange Act, so as to enable the Investor to sell its Common Shares
pursuant to Rule 144 under the Securities Act. In connection with any sale, transfer or other disposition by the Investor of any Common Shares pursuant to Rule 144 under the Securities
Act, the Company shall cooperate with the Investor to facilitate the timely preparation and delivery of certificates representing Common Shares to be sold and not bearing any Securities Act legend,
and enable certificates for such Common Shares to be for such number of shares and registered in such names as the Investor may reasonably request at least two business days prior to any sale of
Common Shares. 

        (b)   The
parties acknowledge that the exchange of securities pursuant to this Agreement is intended to qualify as a "recapitalization," for purposes of Rule 144
(d)(3)(i) under the Securities Act, or a "conversion," for purposes of Rule 144(d)(3)(ii) under the Securities Act. Notwithstanding such intention, if the Investor provides the
Company with a written opinion of counsel, reasonably acceptable to the Company, that the Investor is unable to sell its Common Shares pursuant to Rule 144 under the Securities Act, the Company
will provide the Investor with registration rights comparable to those set forth in the Registration Rights Agreement, dated as of September 12, 2000, between the Company and the Investor. 

        6.15    Class N Preferred Shares Dividend    

        Pursuant
to the Articles Supplementary for the Class N Preferred Shares, on October 1, 2004, the Company will pay the Investor the dividend payable on 4,000,000
Class N Preferred Shares on such date, in the aggregate amount of $2,250,000. 

VII.    MISCELLANEOUS    

        7.1    Survival of Warranties and Covenants.    

        The
warranties and representations of the Company and the Investor contained in or made pursuant to Articles II and III of this Agreement shall survive the Closing through and until the
expiration of the statute of limitations applicable to each such warranty or representation. The covenants contained in or made pursuant to Article VI of this Agreement shall survive the
Closing indefinitely, except for any provisions which expire by their terms. All other representations and warranties contained in or made in this Agreement shall survive the Closing for a period of
three years. The representations and warranties contained in this Agreement 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. 

        7.2    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
hereto. 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. Without limiting the foregoing, no rights set forth in or under this Agreement may be transferred to any purchaser of Class X Preferred
Shares or exercised by or on behalf of any person other than the Investor; provided, however, that the Investor's rights hereunder, other than those contained in Section 6.2, may be assigned to
(i) an institutional investor to whom Investor transfers the Class X Preferred Shares, provided that the assignment of such rights shall be subject to the consent of the Company, which
consent shall not be unreasonably withheld and (ii) an institutional lender pursuant to a bona fide pledge or upon foreclosure of any loan for which the Class X Preferred Shares have
been provided as collateral. 

18

 

        7.3    Governing Law.    

        This
Agreement shall be governed by and construed in accordance with the laws of the State of Illinois, without giving effect to the conflict of law provisions thereof. 

        7.4    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. 

        7.5    Titles and Subtitles.    

        The
title and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement. 

        7.6    Notices.    

        Unless
otherwise provided, any notice required or permitted under this Agreement shall be given in writing and shall be deemed effectively given (a) upon personal delivery to the
party to be notified, (b) on the fifth business day after deposit with the United States Post Office, by registered or certified mail, postage prepaid, (c) on the next business day after
dispatch via nationally recognized overnight courier or (d) upon confirmation of transmission by facsimile, all addressed to the party to be notified at the address indicated for such party
below, or at such other address as such party may designate by ten (10) days' advance written notice to the other parties. Notices should be provided in accordance with this Section at the
following addresses: 

If
to the Investor, to: 

GE
Capital Equity Investments, Inc.

292 Long Ridge Road

Stamford, Connecticut 06927

Facsimile: (203) 357-6768

Attention: Kevin Korsh

and 

GE
Real Estate

500 West Monroe Street, 19th Floor

Chicago, Illinois 60661

Facsimile: (312) 463-2227

Attention: Rick Hurd &

                  John Bonino 

with
a copy to: 

Fried,
Frank, Harris, Shriver & Jacobson LLP

One New York Plaza

New York, New York 10004

Facsimile: (212) 859-4000

Attention: Andrew J. Colosimo, Esq. 

If
to the Company, to: 

Apartment
Investment and Management Company

4582 South Ulster Street Parkway

Suite 1100

Denver, Colorado 80237

Facsimile: (303) 753-9538

Attn: Terry Considine, Paul McAuliffe and Miles Cortez 

19

 

with
a copy to: 

Skadden,
Arps, Slate, Meagher & Flom LLP

300 South Grand Avenue, Suite 3400

Los Angeles, California 90071

Facsimile: (213) 687-5600

Attn: Jonathan Friedman, Esq. 

        7.7    Finder's Fees.    

        Each
party represents that it neither is nor will be obligated for any finders' fee or commission in connection with this transaction. The Investor agrees to indemnify and 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, 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. 

        7.8    Expenses.    

        Each
party shall pay all costs and expenses that it incurs with respect to the negotiation, execution, delivery and performance of this Agreement; provided, however, that the Company
hereby agrees to reimburse the Investor for its reasonable fees and expenses of counsel up to a maximum of $25,000. If any action at law or in equity is necessary to enforce or interpret the terms of
this Agreement or the Class X Preferred Articles Supplementary, the prevailing party shall be entitled to reasonable attorneys' fees, costs and necessary disbursements in addition to any other
relief to which such party may be entitled. 

        7.9    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 (including securities into which such securities are convertible), each future holder of all such securities, and the Company. 

        7.10    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 this Agreement
shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms. 

        7.11    Entire Agreement.    

        This
Agreement constitutes the entire agreement among the parties with respect to the subject matter hereof and supersedes the Subscription Agreement, dated as of September 12,
2000, between the Company and the Investor, 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. 

20

 

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

	 	 	GE CAPITAL EQUITY INVESTMENTS, INC.
	

 	
 	

By:	
 	

/s/  JOHN BONINO      

	 	 	Name:	 	John Bonino
	 	 	Its:	 	Authorized Signatory
	

 	
 	

APARTMENT INVESTMENT AND MANAGEMENT COMPANY
	

 	
 	

By:	
 	

/s/  PAUL J. MCAULIFFE      

	 	 	Name:	 	Paul J. McAuliffe
	 	 	Its:	 	Executive Vice President and Chief Financial Officer
	

 	
 	

AIMCO PROPERTIES, L.P.
	

 	
 	

By:	
 	

AIMCO-GP, Inc., its General Partner
	

 	
 	

By:	
 	

/s/  PAUL J. MCAULIFFE      

	 	 	Name:	 	Paul J. McAuliffe
	 	 	Its:	 	Executive Vice President and Chief Financial Officer

21

QuickLinks

Exhibit 10.1

TABLE OF CONTENTS

EXHIBITS

EXCHANGE AGREEMENT

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