As filed with the Securities and Exchange Commission on December 13, 1999
Registration No. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
United Dominion Realty Trust, Inc.
(Exact name of registrant as specified in its charter)
Virginia 54-0857512
(State or other (I.R.S. Employer
jurisdiction of incorporation Identification No.)
or organization)
10 South 6th Street
Richmond, Virginia 23219-3802
(804) 780-2691
(Address, including zip code, and telephone number,
including area code, of registrant's principal
executive offices)
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Kathryn E. Surface
Senior Vice President and General Counsel
United Dominion Realty Trust, Inc.
10 South Sixth Street
Richmond, Virginia 23219-3802
(804) 780-2691
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
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Copies to:
James W. Featherstone, III, Esq. Howard G. Godwin, Jr., Esq.
Hunton & Williams Brown & Wood
951 East Byrd Street One World Trade Center
Richmond, Virginia 23219-4074 New York, New York 10048-0557
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement in light of
market conditions and other factors.
If the only securities being registered on this form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this form is a post-effective amendment filed pursuant to Rule 462(b)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [X]
<TABLE>
CALCULATION OF REGISTRATION FEE
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Proposed Maximum Proposed Maximum Amount of
Title of Each Class of Aggregate Amount Offering Price Aggregate Offering Registration
Securities to be Registered(1) to be Registered(2) Per Unit(3) Price(2)(3) Fee(5)(6)
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt securities................. $616,058,554 $616,058,554
Preferred stock................. $616,058,554 (4) $616,058,554 $162,639
Common stock(7)................. $616,058,554 $616,058,554
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</TABLE>
(1) This registration statement also covers delayed delivery contracts that may
be issued by the registrant under which the party purchasing the contracts
may be required to purchase debt securities, preferred stock or common
stock. Such contracts may be issued together with the specific offered
securities to which they relate. In addition, offered securities registered
hereunder may be sold either separately or as units comprising more than one
type of offered security registered hereunder.
(2) In U.S. dollars or the equivalent thereof in one or more foreign currencies
or units of two or more foreign currencies or composite currencies (such as
European Currency Units).
(3) Estimated solely for purposes of calculating the registration fee. No
separate consideration will be received for common stock or preferred stock
as may from time to time be issued upon conversion of debt securities or
preferred stock.
(4) Omitted pursuant to General Instruction II.D of Form S-3 under the
Securities Act of 1933.
(5) The registration fee has been calculated in accordance with Rule 457(o)
under the Securities Act of 1933. The total registration fee for all
$616,058,554 of these securities is $162,639.
(6) Pursuant to Rule 429 under the Securities Act of 1933, $83,941,446 of
offered securities are being carried forward from registration statement No.
333-27221. The amount of the registration fee associated with the offered
securities that was previously paid with registration statement No.
333-27221 is $25,437.
(7) Attached to and trading with each share of common stock is the right to
purchase one share of Series C Junior Participating Redeemable Preferred
Stock, no par value.
The prospectus included in this registration statement is a combined
prospectus relating also to registration statement No. 333-27221. This
registration statement also constitutes post-effective amendment No. 1 to
registration statement No. 333-27221 and the post-effective amendment will
hereafter become effective concurrently with the effectiveness of this
registration statement and in accordance with Section 8(c) of the Securities Act
of 1933. This registration statement and the registration statement amended
hereby are collectively referred to herein as the "Registration Statement."
The registrant hereby amends this registration statement on the date or
dates as may be necessary to delay its effective date until the registrant will
file a further amendment which specifically states that this registration
statement will thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
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TABLE OF CONTENTS
PROSPECTUS
RISKS OF INVESTMENT..........................................................2
ABOUT THIS PROSPECTUS........................................................8
WHERE YOU CAN FIND MORE INFORMATION..........................................8
INCORPORATION OF INFORMATION FILED WITH THE SEC..............................9
FORWARD-LOOKING STATEMENTS..................................................10
UNITED DOMINION REALTY TRUST, INC...........................................10
USE OF PROCEEDS.............................................................11
RATIOS OF EARNINGS TO FIXED CHARGES AND RATIOS OF EARNINGS TO
COMBINED FIXED CHARGES AND PREFERRED DIVIDENDS..........................12
DESCRIPTION OF OUR DEBT SECURITIES..........................................12
DESCRIPTION OF OUR CAPITAL STOCK............................................30
FEDERAL INCOME TAX CONSEQUENCES.............................................36
OF UNITED DOMINION'S STATUS AS A REIT.......................................36
PLAN OF DISTRIBUTION........................................................45
LEGAL MATTERS...............................................................46
EXPERTS.....................................................................46
(i)
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SUBJECT TO COMPLETION, DATED December 13, 1999
Prospectus
[United Dominion Logo]
$700,000,000
Debt Securities
Preferred Stock
Common Stock
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This prospectus generally describes the debt securities and equity
securities that we may offer. Each time we sell these securities using this
prospectus, we will provide a prospectus supplement that will contain specific
information about the terms of the offering and may add to or update the
information in this prospectus. You should read this prospectus and any
supplement carefully before you invest. We cannot sell any of these securities
unless this prospectus is accompanied by a prospectus supplement.
Our common shares and currently outstanding Series A and Series B
preferred shares are listed on The New York Stock Exchange (NYSE) under the
symbols "UDR," "UDRpfA" and "UDRpfB," respectively. Our Monthly Income Notes are
listed on the NYSE under the symbol "UDM."
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
--------------------
The information in this prospectus is not complete and may change. We
cannot sell these securities until the registration statement filed with the SEC
is effective. This prospectus neither offers to sell these securities nor
solicits an offer to buy them in any state where the offer or sale of these
securities is not permitted.
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Beginning on page 2, we have listed risks that you should consider
before investing in these securities.
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This prospectus is dated ______________
<PAGE>
RISKS OF INVESTMENT
Unless the context otherwise requires, all references to "we," "us" or
"our company" in this prospectus refer collectively to United Dominion Realty
Trust, Inc., a Virginia corporation, and its subsidiaries, including United
Dominion Realty, L.P., a Virginia limited partnership.
Before you invest in our securities, you should be aware that there are
risks involved in the investment, including those described below. You should
consider carefully these risks together with all of the information included or
incorporated by reference in this prospectus or any prospectus supplement before
you decide to purchase our securities. This section includes or refers to
certain forward-looking statements; you should refer to the explanation of the
qualifications and limitations on such forward-looking statements discussed in
the accompanying prospectus supplement.
I. Unfavorable Changes in Apartment Market and Economic Conditions Could
Adversely Affect Occupancy Levels and Rental Rates
Market and economic conditions in the various metropolitan areas of the
United States in which we operate may significantly affect our occupancy levels
and rental rates and therefore our profitability. This may impair our ability to
satisfy our financial obligations and pay distributions to our shareholders.
Factors that may adversely affect these conditions include the following:
o a reduction in jobs and other local economic downturns;
o oversupply of, or reduced demand for, apartment homes;
o declines in household formation; and
o rent control or stabilization laws, or other laws regulating
rental housing, which could prevent us from raising rents to
offset increases in operating costs.
Any of these factors could adversely affect our ability to achieve
desired operating results from our communities.
II. Acquisitions or New Development May Not Achieve Anticipated Results
We intend to continue to selectively acquire apartment communities that
meet our investment criteria. Our acquisition activities and their success may
be exposed to the following risks:
o An acquired community may fail to perform as we expected in
analyzing our investment.
o When we acquire an apartment community, we often invest
additional amounts in it with the intention of increasing
profitability. These additional investments may not produce
the anticipated improvements in profitability.
o New developments may not achieve proforma rents or occupancy
levels.
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III. Possible Difficulty of Selling Apartment Communities Could Limit
Operational and Financial Flexibility
Although we have experienced success in disposing of apartment
communities that no longer meet our strategic objectives, market conditions
could change and purchasers would not be willing to pay prices acceptable to us.
A weak market may limit our ability to change our portfolio promptly in response
to changing economic conditions. Furthermore, a significant portion of the
proceeds from our overall property sales may be held in escrow accounts in order
for some sales to qualify as a like-kind exchange under Section 1031 of the
Internal Revenue Code so that any related capital gain can be deferred for
federal income tax purposes. As a result, we may not have immediate access to
all of the cash flow generated from our property sales. In addition, federal tax
laws limit our ability to profit on the sale of communities that we have owned
for fewer than four years, and this limitation may prevent us from selling
communities when market conditions are favorable.
IV. Increased Competition Could Limit Our Ability to Lease Apartment Homes
or Increase or Maintain Rents
Our apartment communities compete with numerous housing alternatives in
attracting residents, including other apartment communities and single-family
rental homes, as well as owner occupied single- and multi-family homes.
Competitive housing in a particular area could adversely affect our ability to
lease apartment homes and increase or maintain rents.
V. Insufficient Cash Flow Could Affect Our Debt Financing and Create
Refinancing Risk
We are subject to the risks normally associated with debt financing,
including the risk that our cash flow will be insufficient to make required
payments of principal and interest. Although we may be able to use cash flow to
make future principal payments, we cannot assure investors that sufficient cash
flow will be available to make all required principal payments and still satisfy
our distribution requirements to maintain our status as a real estate investment
trust or "REIT." Therefore, we are likely to need to refinance at least a
portion of our outstanding debt as it matures. There is a risk that we may not
be able to refinance existing debt or that the terms of any refinancing will not
be as favorable as the terms of the existing debt.
VI. Failure to Generate Sufficient Revenue Could Impair Debt Service
Payments and Distributions to Shareholders
If our apartment communities do not generate sufficient net rental
income to meet rental expenses, our ability to make required payments of
interest and principal on our debt securities and to pay distributions to our
shareholders will be adversely affected. The following factors, among others,
may affect the net rental income generated by our apartment communities:
o the national and local economies;
o local real estate market conditions, such as an oversupply of
apartment homes;
o tenants' perceptions of the safety, convenience and
attractiveness of our communities and the neighborhoods where
they are located;
o our ability to provide adequate management, maintenance and
insurance; and
o rental expenses, including real estate taxes and utilities.
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Expenses associated with our investment in a community, such as debt
service, real estate taxes, insurance and maintenance costs, are generally not
reduced when circumstances cause a reduction in rental income from that
community. If a community is mortgaged to secure payment of debt and we are
unable to make the mortgage payments, we could sustain a loss as a result of
foreclosure on the community or the exercise of other remedies by the mortgagee.
VII. Debt Level May Be Increased
Our current debt policy does not contain any limitations on the level
of debt that we may incur, although our ability to incur debt is limited by
covenants in our bank and other credit agreements. We manage our debt to be in
compliance with these debt covenants, but subject to compliance with these
covenants, we may increase the amount of our debt at any time without a
concurrent improvement in our ability to service the additional debt.
VIII. Financing May Not Be Available and Could be Dilutive
Our ability to execute our business strategy depends on our access to
an appropriate blend of debt financing, including unsecured lines of credit and
other forms of secured and unsecured debt, and equity financing, including
common and preferred equity. Debt or equity financing may not be available in
sufficient amounts, or on favorable terms or at all. If we issue additional
equity securities to finance developments and acquisitions instead of incurring
debt, the interests of our existing shareholders could be diluted.
IX. Development and Construction Risks Could Impact Our Profitability
We intend to continue to develop and construct apartment communities.
Development activities may be conducted through wholly-owned affiliated
companies or through joint ventures with unaffiliated parties. Our development
and construction activities may be exposed to the following risks:
o We may be unable to obtain, or face delays in obtaining,
necessary zoning, land-use, building, occupancy, and other
required governmental permits and authorizations, which could
result in increased development costs and could require us to
abandon our activities entirely with respect to a project for
which we are unable to obtain permits or authorizations.
o If we are unable to find joint venture partners to help fund
the development of a community or otherwise obtain acceptable
financing for the developments, our development potential may
be limited.
o We may abandon development opportunities that we have already
begun to explore, and we may fail to recover expenses already
incurred in connection with exploring them.
o We may be unable to complete construction and lease-up of a
community on schedule, or incur development or construction
costs that exceed our original estimates, and we may be unable
to charge rents that would compensate for any increase in such
costs.
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o Occupancy rates and rents at a newly developed community may
fluctuate depending on a number of factors, including market
and economic conditions, preventing us from meeting our
profitability goals for that community.
Construction costs have been increasing in our existing markets, and
the costs of upgrading acquired communities have, in some cases, exceeded our
original estimates. We may experience similar cost increases in the future. Our
inability to charge rents that will be sufficient to offset the effects of any
increases in these costs may impair our profitability.
X. Failure to Succeed in New Markets May Limit Our Growth
We may from time to time make acquisitions outside of our existing
market areas if appropriate opportunities arise. Our historical experience in
our existing markets does not ensure that we will be able to operate
successfully in new markets. We may be exposed to a variety of risks if we
choose to enter new markets. These risks include, among others:
o inability to evaluate accurately local apartment market
conditions and local economies;
o inability to obtain land for development or to identify
appropriate acquisition opportunities;
o inability to hire and retain key personnel; and
o lack of familiarity with local governmental and permitting
procedures.
XI. Changing Interest Rates Could Increase Interest Costs and Could Affect
the Market Price of Our Securities
We currently have, and expect to incur in the future, debt bearing
interest at rates that vary with market interest rates. Therefore, if interest
rates increase, our interest costs will rise to the extent our variable rate
debt is not hedged effectively. In addition, an increase in market interest
rates may lead purchasers of our securities to demand a higher annual yield,
which could adversely affect the market price of our common and preferred stock
and debt securities.
XII. Limited Investment Opportunities Could Adversely Affect Our Growth
We expect that other real estate investors will compete with us to
acquire existing properties and to develop new properties. These competitors
include insurance companies, pension and investment funds, developer
partnerships, investment companies and other apartment REITs. This competition
could increase prices for properties of the type that we would likely pursue,
and our competitors may have greater resources than we do. As a result, we may
not be able to make attractive investments on favorable terms, which could
adversely affect our growth.
XIII. Failure to Integrate Acquired Communities and New Personnel Could
Create Inefficiencies
To grow successfully, we must be able to apply our experience in
managing our existing portfolio of apartment communities to a larger number of
properties. In addition, we must be able to integrate new management and
operations personnel as our organization grows in size and complexity. Failures
in either area will result in inefficiencies that could adversely affect our
expected return on our investments and our overall profitability.
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XIV. Interest Rate Hedging Contracts May Be Ineffective and May Result in
Material Charges
From time to time when we anticipate issuing debt securities, we may
seek to limit our exposure to fluctuations in interest rates during the period
prior to the pricing of the securities by entering into interest rate hedging
contracts. We may do this to increase the predictability of our financing costs.
Also, from time to time we may rely on interest rate hedging contracts to limit
our exposure under variable rate debt to unfavorable changes in market interest
rates. If the pricing of new debt securities is not within the parameters of, or
market interest rates produce a lower interest cost than that we incur under, a
particular interest rate hedging contract, the contract is ineffective.
Furthermore, the settlement of interest rate hedging contracts has involved and
may in the future involve material charges.
XV. Year 2000 Issues May Disrupt Our Operations
"Year 2000 issues" means problems that may result from the improper
processing by computer systems of dates after 1999. These problems could result
in systems failures or miscalculations causing disruptions of operations. Our
efforts to address our Year 2000 issues are focused on three areas:
o reviewing and taking any necessary steps to attempt to correct
our computer information systems;
o evaluating and making any necessary modifications to other
computer systems that do not relate to information technology
but include embedded technology, such as telecommunication,
security, elevator, fire and safety, and heating, ventilation
and air conditioning systems; and
o communicating with our important service providers to
determine whether there will be any interruption to their
systems that could affect us.
We believe that our own systems will be Year 2000 compliant by December
31, 1999. Although we are still in the process of evaluating potential
disruptions or complications that might result from Year 2000 issues, we have
not identified any specific business functions that are likely to suffer
material disruptions. Due to the unique and pervasive nature of Year 2000
issues, however, we are not able to anticipate all events that might affect us,
particularly those outside of our company. While our efforts to address Year
2000 issues will involve additional costs, we believe that these costs will not
have a material impact on our financial results. If we do not complete our
efforts on time or if the costs of updating or replacing our systems exceed our
estimates, or if essential services are disrupted because the provider has not
adequately dealt with its Year 2000 issues, our business, financial condition
and results of operations could be materially adversely affected.
XVI. Potential Liability for Environmental Contamination Could Result in
Substantial Costs
We are in the business of acquiring, developing, owning, operating and
from time to time selling real estate. Under various federal, state and local
environmental laws, as a current or former owner or operator, we could be
required to investigate and remediate the effects of contamination of currently
or formerly owned real estate by hazardous or toxic substances, often regardless
of our knowledge of or responsibility for the contamination and solely by virtue
of our current or former ownership or operation of the real estate. In addition,
we could be held liable to a governmental authority or to third parties for
property damage and for investigation and clean-up costs incurred in connection
with the contamination. These costs could be substantial, and in many cases
environmental laws create liens in favor of governmental authorities to secure
their payment. The presence of such substances or a failure to properly
remediate any resulting contamination could materially and adversely affect our
ability to borrow against, sell or rent an affected property.
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XVII. Compliance With REIT Share Ownership Limit May Prevent Takeovers
Beneficial to Shareholders
One of the requirements for maintenance of our qualification as a REIT
for federal income tax purposes is that no more than 50% in value of our
outstanding capital stock may be owned by five or fewer individuals, including
entities specified in the Internal Revenue Code, during the last half of any
taxable year. Our Restated Articles of Incorporation, also referred to as our
"Charter," include provisions allowing us to stop transfers of and redeem our
shares that are intended to assist us in complying with this requirement. These
provisions may have the effect of delaying, deferring or preventing someone from
taking control of us, even though a change of control might involve a premium
price for our shareholders or might otherwise be in our shareholders' best
interests. See the subsection entitled "Requirements for Qualification" in the
section entitled "Federal Income Tax Consequences of United Dominion's Status as
a REIT" in this prospectus.
XVIII. Failure to Qualify as a REIT Would Cause Us to Be Taxed as a
Corporation, Which Would Significantly Lower Funds Available For
Distribution to Our Shareholders
If we fail to qualify as a REIT for federal income tax purposes, we
will be taxed as a corporation. We believe that we are organized and currently
qualify as a REIT and intend to operate in such a manner that will allow us to
continue to qualify as a REIT. However, we cannot assure you that we are
qualified as a REIT or that we will remain qualified as a REIT in the future.
Qualification as a REIT involves the application of highly technical and complex
provisions of the federal income tax laws, as to which there are only limited
judicial and administrative interpretations, and requires favorable
determination of various factual matters and circumstances not entirely within
our control. In addition, future legislation, new regulations, administrative
interpretations or court decisions may significantly change the tax laws or the
application of the tax laws with respect to our qualification as a REIT for
federal income tax purposes or the federal income tax consequences of our
qualification.
If, in any taxable year, we fail to qualify as a REIT, we will be
subject to federal income tax on our taxable income at regular corporate rates,
plus any applicable alternative minimum tax. In addition, unless we are entitled
to relief under applicable statutory provisions, we would be disqualified from
treatment as a REIT for the four taxable years following the year in which we
lose our qualification. The additional tax liability resulting from the failure
to qualify as a REIT would significantly reduce or eliminate funds otherwise
available for distribution to our shareholders. Furthermore, we would no longer
be required to make distributions to our shareholders. See the section entitled
"Federal Income Tax Consequences of United Dominion's Status as a REIT" in this
prospectus.
XIX. The Ability of Our Shareholders to Control Our Policies and Affect a
Change of Control of Our Company is Limited, Which May Not Be in Our
Shareholders' Best Interests
In 1998, we adopted a shareholder rights plan. Under the terms of the
shareholder rights plan, our Board of Directors can in effect prevent a person
or group from acquiring more than 15% of the outstanding shares of our common
stock. Unless our Board of Directors approves the person's purchase, after that
person acquires more than 15% of our outstanding common stock, all other
shareholders will have the right to purchase securities from us at a price that
is less than their then fair market value. Purchases by other shareholders would
substantially reduce the value and influence of the shares of our common stock
owned by the acquiring person. Our Board of Directors, however, can prevent the
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shareholder rights plan from operating in this manner. This gives our Board of
Directors significant discretion to approve or disapprove a person's efforts to
acquire a large interest in us. For a more complete description, you should
refer to the subsection entitled "Description of Our Capital Stock--Rights to
Purchase Series C Preferred Stock."
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement on Form S-3 that we
filed with the SEC utilizing a "shelf" registration process. Under this process,
we may sell any combination of the securities described in this prospectus in
one or more offerings up to a total dollar amount of $700,000,000.
This prospectus provides you with a general description of the
securities that we may offer and the terms of the offering. Each time we offer
securities, we will provide a prospectus supplement that will contain specific
descriptions of those securities and the offering terms. The prospectus
supplement may also add to, update or otherwise change information contained in
this prospectus. The documents incorporated in this prospectus by reference and
the registration statement that we filed with the SEC, including exhibits to the
registration statement, provide more detail on the matters discussed in this
prospectus. In making your investment decision, you should carefully read this
prospectus and any prospectus supplement together with the additional
information described below under the heading "Where You Can Find More
Information."
WHERE YOU CAN FIND MORE INFORMATION
We file with the SEC annual reports on Form 10-K, quarterly reports on
Form 10-Q, current reports on Form 8-K and proxy or information statements,
which are incorporated by reference in this prospectus as described under the
heading "Incorporation of Information Filed With the SEC" below. The public may
read and copy the reports and other information that we file with the SEC at
their public reference facilities at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549. Copies of these materials can be obtained from the
Public Reference Section of the SEC in Washington, D.C. 20549 at prescribed
rates. The public may obtain information on the operation of the Public
Reference Room by calling the SEC at 1-800-SEC-0330.
You may also obtain information about us from the following regional
offices of the SEC: Seven World Trade Center, 13th Floor, New York, New York
10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60601-2511.
The SEC maintains an Internet site that contains reports, proxy and
information statements, and other information regarding United Dominion and
other issuers that file electronically with the SEC. The address of that site is
http://www.sec.gov.
This prospectus omits certain information included in the registration
statement and its exhibits. Statements made in this prospectus as to the
contents of any contract, agreement or other document that is an exhibit to the
registration statement are only summaries and are not complete. We refer you to
the relevant exhibits for a more complete description of the matter involved.
Each statement regarding an exhibit is qualified by the text of the relevant
document.
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INCORPORATION OF INFORMATION FILED WITH THE SEC
We are "incorporating by reference" certain information that we have
filed with the SEC, which means:
o incorporated documents are considered part of this prospectus;
o we are disclosing important information to you by referring
you to those documents; and
o information that we file with the SEC will automatically
update and supersede this prospectus.
We incorporate by reference the documents listed below that we filed
with the SEC under the Securities Exchange Act of 1934:
o Annual Report on Form 10-K for the year ended December 31,
1998;
o Quarterly Report on Form 10-Q for the quarter ended March 31,
1999;
o Quarterly Report on Form 10-Q for the quarter ended June 30,
1999;
o Quarterly Report on Form 10-Q for the quarter ended September
30, 1999;
o Consent Report on Form 8-K dated October 23, 1998;
o Current Report on Form 8-K dated January 20, 1999;
o Current Report on Form 8-K dated March 29, 1999; and
o The description of our common stock contained in our
Registration Statement on Form 8A dated April 19, 1990,
including any amendment filed for the purpose of updating that
description.
We also incorporate by reference each of the following documents that
we may file with the SEC after the date of this prospectus:
o Reports filed under Sections 13(a) and (c) of the Exchange
Act;
o Definitive proxy or information statements filed under Section
14 of the Exchange Act in connection with any subsequent
shareholders' meeting; and
o Any reports filed under Section 15(d) of the Exchange Act.
We will provide to each person, including any beneficial owner, to whom
this prospectus is delivered, a copy of any or all of the information
incorporated by reference upon written or oral request at no cost to the
requester. Requests must be made to:
United Dominion Realty Trust, Inc.
10 South Sixth Street
Richmond, Virginia 23219-3802
Attention: Investor Relations
(804) 780-2691.
You should rely only on the information contained or incorporated by
reference in this prospectus, any prospectus supplement and the registration
statement. We have not authorized anyone to provide you with different
information. If anyone provides you with different or inconsistent information,
you should not rely on it. You should assume that the information appearing in
this prospectus, as well as information that we filed with the SEC before the
date of this prospectus and incorporated by reference in this prospectus, is
accurate as of the date on the front cover of this prospectus only. Our
business, financial condition, results of operations and prospects may have
changed since that date.
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FORWARD-LOOKING STATEMENTS
This prospectus and the registration statement, and the reports, proxy
statements and other information that we have filed with the SEC, which we
incorporate by reference in this prospectus, may include "forward-looking
statements" within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. The words "anticipate,"
"believe," "estimate," "expect," "project" and similar expressions, as they
relate to us or our management, are intended to identify forward-looking
statements.
We have based these forward-looking statements largely on our
expectations as well as assumptions that we have made and information currently
available to our management. Although we believe that our expectations and
assumptions are reasonable, they are subject to a number or risks and
uncertainties, some of which are beyond our control, and we therefore can give
no assurance that they will in fact be realized. Forward-looking statements that
are dependent upon realization of our assumptions and expectations include, but
are not limited to, those discussing:
o our declaration or payment of distributions;
o our potential developments or acquisitions or dispositions of
properties, assets or other public or private companies;
o our policies regarding investments, indebtedness,
acquisitions, dispositions, financings, conflicts of interest
and other matters;
o our qualification as a REIT under the Internal Revenue Code;
o the real estate markets in which we operate and in general;
o the availability of debt and equity financing;
o interest rates;
o general economic conditions; and
o trends affecting our financial condition or results of
operations.
We undertake no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise.
UNITED DOMINION REALTY TRUST, INC.
United Dominion operates in one defined business segment as an owner,
operator, renovator and developer with activities related to the ownership,
acquisition, development, management and strategic disposition of multifamily
apartment communities nationwide. Our strategy is to be a national, highly
efficient provider of quality apartment homes. During the past several years, we
have implemented this strategy through:
o the acquisition of portfolios and mergers with companies
primarily in different markets and different regions;
o the acquisition of higher quality communities;
o the disposition of communities that do not meet our long-term
strategic objectives due to location, size, age, quality
and/or operating performance;
o the development of higher quality apartment communities in
target markets that can provide higher returns on investment;
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o the upgrade of our communities through various capital
investments and through the addition of revenue enhancing
and/or expense reducing features;
o the hiring of experienced corporate and operations staff; and
o the investment in efficient, scalable systems.
We seek to be a market leader by operating a sufficiently sized
portfolio of apartments within each of our targeted markets in order to reduce
operating costs through economies of scale and management efficiencies. We
believe that geographic market diversification increases investment opportunity
and decreases the risk associated with cyclical local real estate markets and
economies.
At September 30, 1999, we owned 318 communities with 85,216 apartment
homes nationwide. In addition, we had apartment communities with approximately
2,000 apartment homes under development. Our apartment communities consist
primarily of upper and middle income garden and townhouse communities. Most of
the communities are considered to be "A" and "B" quality, that compete at or
near the top of their respective markets. "A" grade communities are generally
properties less than five years old with superior amenity packages. "B" grade
communities are generally either of 1980s construction, located in good
neighborhoods, or renovated 1970s construction in good neighborhoods. We believe
that these well located apartments offer us a good combination of current income
and longer-term income growth.
We intend to continue to qualify as a REIT under the applicable
provisions of the federal income tax laws. To qualify, we must satisfy various
tests that, among other things, require that our assets consist primarily of
real estate, our income be derived primarily from real estate and at least 95%
of our taxable income be distributed to our shareholders. Because we qualify as
a REIT, we are generally not subject to federal income taxes. For a more
complete discussion of the tax related consequences of our being a REIT, see the
section entitled "Federal Income Tax Consequences of United Dominion's Status as
a REIT" in this prospectus.
United Dominion is a Virginia corporation and a self-managed real
estate investment trust. Our common stock is traded on The New York Stock
Exchange under the symbol "UDR." Our principal office is at 10 South Sixth
Street, Richmond, Virginia 23219-3802. Our telephone number is (804) 780-2691,
our E-mail address is [email protected], and our Internet address is
http://www.udrt.com.
USE OF PROCEEDS
Unless we state otherwise in the applicable prospectus supplement, we
intend to use the net proceeds from the sale of our securities for one or more
of the following:
o to repay indebtedness;
o to fund improvements to properties;
o to acquire and develop additional properties; and
o for other general corporate purposes.
The prospectus supplement may also include the allocation of the net proceeds
from the sale of our securities among the various uses listed above.
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We may temporarily invest any proceeds that are not immediately applied
to the above purposes in U.S. government or agency obligations, commercial
paper, bank certificates of deposit or repurchase agreements collateralized by
U.S. government or agency obligations. We may also deposit the proceeds with
banks.
RATIOS OF EARNINGS TO FIXED CHARGES AND RATIOS OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERRED DIVIDENDS
The following table sets forth United Dominion's consolidated ratios of
earnings to fixed charges and earnings to combined fixed charges and preferred
stock dividends for the periods shown.
<TABLE>
<CAPTION>
Year Ended December 31,
------------------------------------------------------- Nine Months Ended
1994 1995 1996 1997 1998 September 30, 1999
---- ---- ---- ---- ---- ------------------
<S> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges.... 1.69x 1.81x 1.73x 1.82x 1.63x 1.63x
Ratio of earnings to combined fixed
charges and preferred stock 1.69 1.56 1.45 1.51 1.34 1.32
dividends.............................
</TABLE>
The ratio of earnings to fixed charges was computed by dividing
earnings by fixed charges. The ratio of earnings to combined fixed charges and
preferred stock dividends was computed by dividing earnings by the total of
fixed charges and preferred stock dividends. For purposes of computing these
ratios, earnings consist of income before extraordinary items plus fixed charges
other than capitalized interest, and fixed charges consist of interest on
borrowed funds (including capitalized interest) and amortization of debt
discount and expense.
DESCRIPTION OF OUR DEBT SECURITIES
The following is a description of the material terms of our debt
securities. We will provide additional terms of our debt securities in a
prospectus supplement.
As required by federal law for all publicly offered notes and
debentures, the debt securities that we may offer with this prospectus are
governed by documents called "indentures." We will issue senior debt securities
under an Indenture, dated as of November 1, 1995, between United Dominion and
First Union National Bank, as trustee. We refer to this indenture as the "Senior
Indenture." We will issue our subordinated debt securities under the Indenture,
dated as of August 1, 1994, between United Dominion and Crestar Bank, as
trustee. We refer to this indenture as the "Subordinated Indenture." As
trustees, First Union and Crestar serve two roles. First, the trustees can
enforce your rights against us should we default on the debt securities. Second,
the trustees assist in administering our obligations under the debt securities,
such as payments of interest.
Below, we describe the indentures and summarize some of their
provisions. However, we have not described every aspect of the debt securities.
You should refer to the actual indentures for a complete description of their
provisions and the definitions of terms used in them. In this prospectus, we
provide only the definitions for some of the more important terms in the
indentures. Wherever we refer to defined terms of the indentures in this
prospectus or in the prospectus supplement, we are incorporating by reference
those defined terms.
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The indentures are exhibits to the registration statement. See "Where
You Can Find More Information" for information on how to obtain a copy of the
indentures for your review.
General Terms of Our Debt Securities
We may offer with this prospectus up to $700,000,000 in aggregate
principal amount of unsecured debt obligations. However, the indentures do not
limit the aggregate principal amount of debt securities that we may issue and
provide that we may issue debt securities from time to time in one or more
series, except that the Senior Indenture contains limitations on the amount of
indebtedness that we may incur. See "-- Covenants Applicable to Our Senior Debt
Securities."
The senior debt securities will be unsecured obligations and will rank
on a parity with all of our other unsecured and unsubordinated indebtedness.
The subordinated debt securities will be our unsecured obligations and
will be subordinated in right of payment to all senior debt.
Each indenture allows for any one or more series of debt securities to
have one or more trustees. Any trustee under either indenture may resign or be
removed with respect to one or more series of debt securities, and a successor
trustee may be appointed to act with respect to the series. In the event that
two or more persons are acting as trustee with respect to different series of
debt securities, each trustee will be a trustee of a trust under the applicable
indenture separate and apart from the trust administered by any other trustee.
Unless this prospectus states differently, each trustee of a series of debt
securities may take any action that United Dominion may take under the
applicable indenture.
The prospectus supplement will describe the particular terms of each
series of debt securities, as well as any modifications or additions to the
general terms of the indenture applicable to the series of debt securities. This
description will contain all or some of the following as applicable:
o the title of the debt securities and whether the debt
securities are senior debt securities or subordinated debt
securities;
o the aggregate principal amount of the debt securities being
offered, the aggregate principal amount of debt securities
outstanding, and any limit on the principal amount, including
the aggregate principal amount of debt securities authorized;
o the percentage of the principal amount at which we will issue
the debt securities and, if other than the principal amount of
the debt securities, the portion of the principal amount
payable upon declaration of acceleration of their maturity,
or, if applicable, the portion of the principal amount of the
debt securities that is convertible into United Dominion
capital stock, or the method for determining the portion;
o if convertible, in connection with the preservation of our
status as a REIT, any applicable limitations on the ownership
or transferability of our capital stock into which the debt
securities are convertible;
o the date or dates, or the method for determining the date or
dates, on which the principal of the debt securities will be
payable and the amount of principal payable on the debt
securities;
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o the rate or rates, which may be fixed or variable, at which
the debt securities will bear interest, if any, or the method
for determining the rate or rates, the date or dates from
which the interest will accrue or the method for determining
the date or dates, the interest payment dates on which any
interest will be payable and the regular record dates for the
interest payment dates or the method for determining the
dates, the person to whom interest should be payable, and the
basis for calculating interest if other than that of a 360-day
year consisting of twelve 30-day months;
o the place or places where the principal of, and any premium or
make-whole amount as defined in each indenture, any interest
on, and any additional amounts payable in respect of, the debt
securities will be payable, where holders of debt securities
may surrender for registration of transfer or exchange, and
where holders may serve notices or demands to or upon United
Dominion in respect of the debt securities and the applicable
indenture;
o the period or periods within which, the price or prices,
including any premium or make-whole amount, at which, the
currency or currencies, currency unit or units or composite
currency or currencies in which and other terms and conditions
upon which the debt securities may be redeemed in whole or in
part at our option, if we have the option;
o our obligation, if any, to redeem, repay or purchase the debt
securities pursuant to any sinking fund or analogous provision
or at the option of a holder of the debt securities, and the
period or periods within which or the date or dates on which,
the price or prices at which, the currency or currencies,
currency unit or units or composite currency or currencies in
which, and other terms and conditions upon which the debt
securities will be redeemed, repaid or purchased, in whole or
in part, pursuant to the obligation;
o if other than United States dollars, the currency or
currencies in which the debt securities will be denominated
and payable, which may be a foreign currency or units of two
or more foreign currencies or a composite currency or
currencies;
o whether the amount of payments of principal of, and any
premium or make-whole amount, or any interest on the debt
securities may be determined with reference to an index,
formula or other method, which index, formula or method may be
based on one or more currencies, currency units, composite
currencies, commodities, equity indices or other indices, and
the manner for determining the amounts;
o whether the principal of, and any premium or make-whole
amount, or any interest or additional amounts on the debt
securities are to be payable, at the election of United
Dominion or a holder, in a currency or currencies, currency
unit or units or composite currency or currencies other than
that in which the debt securities are denominated or stated to
be payable, the period or periods within which, and the terms
and conditions upon which, the election may be made, and the
time and manner of, and identity of the exchange rate agent
with responsibility for, determining the exchange rate between
the currency or currencies, currency unit or units or
composite currency or currencies in which the debt securities
are denominated or stated to be payable and the currency or
currencies, currency unit or units or composite currency or
currencies in which the debt securities are to be so payable;
o provisions, if any, granting special rights to the holders of
the debt securities upon the occurrence of specified events;
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o any deletions from, modifications of or additions to the
events of default or covenants of United Dominion with respect
to the debt securities, whether or not the events of default
or covenants are consistent with the events of default or
covenants set forth in the applicable indenture;
o whether the debt securities will be issued in certificated or
book-entry form;
o the applicability, if any, of the defeasance and covenant
defeasance provisions of the applicable indenture;
o whether and under what circumstances we will pay additional
amounts as contemplated in the applicable indenture on the
debt securities in respect of any tax, assessment or
governmental charge and, if so, whether we will have the
option to redeem the debt securities rather than pay the
additional amounts, and the terms of the option; and
o any other terms of the debt securities not inconsistent with
the provisions of the applicable indenture.
The debt securities may be original issue discount securities, which
are debt securities that may provide for less than their entire principal amount
to be payable upon declaration of acceleration of their maturity. Special United
States federal income tax, accounting and other considerations applicable to
original issue discount securities will be described in the prospectus
supplement.
We will provide you with more information in the applicable prospectus
supplement regarding any deletions, modifications or additions to the events of
default or covenants that are described below, including any addition of a
covenant or other provision.
Denominations, Interest, Registration and Transfer
Unless the prospectus supplement states differently, the debt
securities of any series issued in registered form will be issuable in
denominations of $1,000 and integral multiples of $1,000. Unless the prospectus
supplement states differently, the debt securities of any series issued in
bearer form will be issuable in denominations of $5,000.
Unless the prospectus supplement provides differently, the trustees
will pay the principal of and any premium and interest on the debt securities
and will register the transfer of any debt securities at their offices. However,
at our option, we may distribute interest payments by mailing a check to the
address of each holder of debt securities that appears on the register for the
debt securities.
Any interest on a debt security not punctually paid or duly provided
for on any interest payment date will cease to be payable to the holder on the
applicable regular record date. This defaulted interest may be paid to the
person in whose name the debt security is registered at the close of business on
a special record date for the payment of the defaulted interest. United Dominion
will set the special record date and give the holder of the debt security at
least 10 days' prior notice. In the alternative, this defaulted interest may be
paid at any time in any other lawful manner, all as more completely described in
the applicable indenture.
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Subject to any limitations imposed upon debt securities issued in
book-entry form, the debt securities of any series will be exchangeable for
other debt securities of the same series and of a like aggregate principal
amount and tenor of different authorized denominations upon surrender to the
applicable trustee of the debt securities. In addition, subject to any
limitations imposed upon debt securities issued in book-entry form, a holder may
surrender the debt securities to the trustee for conversion or registration of
transfer. Every debt security surrendered for conversion, registration of
transfer or exchange will be duly endorsed or accompanied by a written
instrument of transfer from the holder. A holder will not have to pay a service
charge for any registration of transfer or exchange of any debt securities, but
United Dominion may require payment of a sum sufficient to cover any applicable
tax or other governmental charge.
If the prospectus supplement refers to any transfer agent, in addition
to the applicable trustee that United Dominion initially designated with respect
to any series of debt securities, United Dominion may at any time rescind the
designation of the transfer agent or approve a change in the location through
which the transfer agent acts, except that United Dominion will be required to
maintain a transfer agent in each place of payment for the series. United
Dominion may at any time designate additional transfer agents with respect to
any series of debt securities.
Neither United Dominion nor the trustees will be required to:
o issue, register the transfer of or exchange debt securities of
any series during a period beginning at the opening of
business 15 days before any selection of debt securities of
that series to be redeemed and ending at the close of business
on the day of mailing of the relevant notice of redemption;
o register the transfer of or exchange any debt security, or
portion thereof, called for redemption, except the unredeemed
portion of any debt security being redeemed in part; or
o issue, register the transfer of or exchange any debt security
that has been surrendered for repayment at the holder's
option, except the portion, if any, of the debt security not
to be repaid.
Merger, Consolidation or Sale
We may consolidate with, or sell, lease or convey all or substantially
all of our assets to, or merge with or into, any other entity, provided that:
o either we will be the continuing entity, or the successor
entity formed by or resulting from the consolidation or merger
or that will have received the transfer of the assets is a
person organized and existing under the laws of the United
States or any state and will expressly assume payment of the
principal of, and any premium or make-whole amount, and
interest on all of the debt securities and the due and
punctual performance and observance of all of the covenants
and conditions contained in each indenture;
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o immediately after giving effect to the transaction and
treating any resulting indebtedness that becomes our or any
subsidiary's obligation as having been incurred by us or the
subsidiary at the time of the transaction, no event of default
under the indenture, and no event which, after notice or the
lapse of time, or both, would become an event of default, will
have occurred and be continuing; and
o we receive an Officers' Certificate and legal opinion as to
compliance with these conditions.
Covenants Applicable to Our Senior Debt Securities
Senior Indenture Limitations on Incurrence of Debt. The Senior
Indenture provides that we will not, and will not permit any subsidiary to,
incur any Debt (as defined below) if, immediately after giving effect to the
incurrence of the Debt and the application of the proceeds from the Debt, the
aggregate principal amount of all of our outstanding Debt on a consolidated
basis determined in accordance with generally accepted accounting principles is
greater than 60% of the sum of, without duplication:
o our Total Assets (as defined below) as of the end of the
calendar quarter covered in our Annual Report on Form 10-K or
Quarterly Report on Form 10-Q, as the case may be, most
recently filed with the SEC, or, if the filing is not
permitted under the Exchange Act, with the trustee, prior to
the incurrence of the additional Debt; and
o the purchase price of any real estate assets or mortgages
receivable acquired, and the amount of any securities offering
proceeds received, to the extent the proceeds were not used to
acquire real estate assets or mortgages receivable or used to
reduce Debt, by us or any subsidiary since the end of the
calendar quarter, including those proceeds obtained in
connection with the incurrence of the additional Debt.
The Subordinated Indenture does not limit the incurrence of Debt.
In addition to the foregoing limitation on the incurrence of Debt, the
Senior Indenture provides that we will not, and will not permit any subsidiary
to, incur any Debt secured by any mortgage, lien, charge, pledge, encumbrance or
security interest of any kind upon any of our or any subsidiary's property if,
immediately after giving effect to the incurrence of the Debt and the
application of the proceeds from the Debt, the aggregate principal amount of all
of our outstanding Debt on a consolidated basis that is secured by any mortgage,
lien, charge, pledge, encumbrance or security interest on our or any
subsidiary's property is greater than 40% of our Total Assets.
In addition to the foregoing limitations on the incurrence of Debt, the
Senior Indenture provides that we will not, and will not permit any subsidiary
to, incur any Debt if the ratio of Consolidated Income Available for Debt
Service (as defined below) to the Annual Service Charge (as defined below) for
the four consecutive fiscal quarters most recently ended prior to the date on
which the additional Debt is to be incurred will have been less than 1.5, on a
pro forma basis after giving effect to the Debt and to the application of the
proceeds from the Debt, and calculated on the assumption that:
o the Debt and any other Debt that we have incurred since the
first day of the four-quarter period and the application of
the proceeds therefrom, including to refinance other Debt, had
occurred at the beginning of the period;
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o our repayment or retirement of any other Debt since the first
day of the four-quarter period had been incurred, repaid or
retired at the beginning of the period, except that, in making
the computation, the amount of Debt under any revolving credit
facility will be computed based upon the average daily balance
of the Debt during the period;
o in the case of Acquired Debt (as defined below) or Debt
incurred in connection with any acquisition since the first
day of the four-quarter period, the related acquisition had
occurred as of the first day of the period with the
appropriate adjustments with respect to the acquisition being
included in the pro forma calculation; and
o in the case of our acquisition or disposition of any asset or
group of assets since the first day of the four-quarter
period, whether by merger, stock purchase or sale, or asset
purchase or the acquisition or disposition or any related
repayment of Debt had occurred as of the first day of the
period with the appropriate adjustments with respect to the
acquisition or disposition being included in the pro forma
calculation.
The following terms used in the covenants summarized above have the
indicated meanings:
"Acquired Debt" means Debt of a person (i) existing at the time the
person becomes a subsidiary or (ii) assumed in connection with the acquisition
of assets from the person, in each case, other than Debt incurred in connection
with, or in contemplation of, the person becoming a subsidiary or the
acquisition. Acquired Debt will be deemed to be incurred on the date of the
related acquisition of assets from any person or the date the acquired person
becomes a subsidiary.
"Annual Service Charge" as of any date means the maximum amount that is
payable in any period for interest on, and original issue discount of, our Debt
and the amount of dividends that are payable in respect of any Disqualified
Stock (as defined below).
"Capital Stock" means, with respect to any person, any capital stock,
including preferred stock, shares, interests, participations or other ownership
interests, however designated, of the person and any rights, other than debt
securities convertible into or exchangeable for corporate stock, warrants or
options to purchase any capital stock.
"Consolidated Income Available for Debt Service" for any period means
Funds from Operations (as defined below) plus amounts that have been deducted
for interest on Debt.
"Debt" of United Dominion or any subsidiary means any indebtedness of
United Dominion, or any subsidiary, whether or not contingent, in respect of,
without duplication:
o borrowed money or evidenced by bonds, notes, debentures or
similar instruments;
o indebtedness secured by any mortgage, pledge, lien, charge,
encumbrance or any security interest existing on property
owned by United Dominion or any subsidiary;
o the reimbursement obligations, contingent or otherwise, in
connection with any letters of credit actually issued or
amounts representing the balance deferred and unpaid of the
purchase price of any property or services, except any balance
that constitutes an accrued expense or trade payable, or all
conditional sale obligations or obligations under any title
retention agreement;
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o the principal amount of all obligations of United Dominion or
any subsidiary with respect to redemption, repayment or other
repurchase of any Disqualified Stock; or
o any lease of property by United Dominion or any subsidiary as
lessee that is reflected on United Dominion's consolidated
balance sheet as a capitalized lease in accordance with
generally accepted accounting principles to the extent, in the
case of items of indebtedness under the first three bullet
points above, that any of the items, other than letters of
credit, would appear as a liability on United Dominion's
consolidated balance sheet in accordance with generally
accepted accounting principles, and also includes, to the
extent not otherwise included, any obligation of United
Dominion or any subsidiary to be liable for, or to pay, as
obligor, guarantor or otherwise, other than for purposes of
collection in the ordinary course of business, Debt of another
person, other than United Dominion or any subsidiary.
Debt will be deemed to be incurred by us or any subsidiary whenever we or a
subsidiary creates, assumes, guarantees or otherwise becomes liable for that
Debt.
"Disqualified Stock" means, with respect to any person, any capital
stock of the person that by the terms of the capital stock, or by the terms of
any security into which it is convertible or for which it is exchangeable or
exercisable, upon the happening of any event or otherwise:
o matures or is mandatorily redeemable, pursuant to a sinking
fund obligation or otherwise;
o is convertible into or exchangeable or exercisable for Debt or
Disqualified Stock; or
o is redeemable at the option of the holder thereof, in whole or
in part, in each case on or prior to the Stated Maturity of
the series of debt securities.
"Funds From Operations" for any period means income before gains or
losses on investments and extraordinary items plus amounts that have been
deducted, and minus amounts that have been added, for the following items,
without duplication:
o provision for preferred stock dividends;
o provision for property depreciation and amortization; and
o the effect of any adjustments for significant non-recurring
items, including any noncash charge resulting from a change in
accounting principles in determining income before gains or
losses on investments and extraordinary items for the period,
as reflected in our financial statements for the period
determined on a consolidated basis in accordance with
generally accepted accounting principles.
"Total Assets" as of any date means the sum of:
o our Undepreciated Real Estate Assets; and
o all of our other assets determined in accordance with
generally accepted accounting principles, but excluding
intangibles.
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"Undepreciated Real Estate Assets" as of any date means the original
cost plus capital improvements of our real estate assets on the date, before
depreciation and amortization determined on a consolidated basis in accordance
with generally accepted accounting principles.
Except as described above, the indentures do not contain any provisions
that would limit our ability to incur indebtedness or that would afford holders
of the debt securities protection in the event of a highly leveraged or similar
transaction involving us or in the event of a change of control. However, our
Charter includes provisions for mandatory redemption and stopping transfer of
our common stock designed to preserve our status as a REIT. The Internal Revenue
Code of 1986 provides that concentration of more than 50% in value of direct or
indirect ownership of common stock in five or fewer individual shareholders
during the last six months of any year will result in our disqualification as a
REIT. Enforcement of the provisions of our Charter would prevent this
concentration and, therefore, prevent or hinder a change of control. You should
refer to the prospectus supplement for information with respect to any deletions
from, modifications of or additions to the events of default or covenants of
United Dominion that are described in this section, including any addition of a
covenant or other provision providing event risk or similar protection.
Covenants Applicable to All Debt Securities
Existence. Except as described above under "--Merger, Consolidation or
Sale," we will do or cause to be done all things necessary to preserve and keep
in full force and effect our existence, rights, both under our Charter and
statutory, and franchises. However, we will not be required to preserve any
right or franchise if we determine that its preservation is no longer desirable
in the conduct of our business as a whole and that the loss thereof is not
disadvantageous in any material respect to the holders of the debt securities of
any series.
Maintenance of Properties. We will cause all of our properties used or
useful in the conduct of our business or the business of any subsidiary to be
maintained and kept in good condition, repair and working order and supplied
with all necessary equipment and will cause to be made all necessary repairs,
renewals, replacements, betterments and improvements thereof, all as in our
judgment may be necessary so that our business may be properly and
advantageously conducted at all times. However, we will not be prevented from
selling or otherwise disposing of for value our properties in the ordinary
course of business.
Insurance. We will, and will cause each of our subsidiaries to, keep
all of our insurable properties insured against loss or damage in an amount at
least equal to their then full insurable value with financially sound and
reputable insurance companies.
Payment of Taxes and Other Claims. We will pay or discharge or cause to
be paid or discharged, before the same will become delinquent:
o all taxes, assessments and governmental charges levied or
imposed upon us or any subsidiary or upon our or any
subsidiary's income, profits or property; and
o all lawful claims for labor, materials and supplies that, if
unpaid, might by law become a lien upon our or any
subsidiary's property.
However, we will not be required to pay or discharge or cause to be paid or
discharged any tax, assessment, charge or claim whose amount, applicability or
validity is being contested in good faith by appropriate proceedings.
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Provision of Financial Information. Whether or not we are subject to
Sections 13 or 15(d) of the Exchange Act, we will, to the extent permitted under
the Exchange Act, file with the SEC in a timely fashion the annual reports,
quarterly reports and other documents that we would have been required to file
with the SEC pursuant to Sections 13 and 15(d). We will also in any event:
o within 15 days of each required filing date
- transmit by mail to all holders of debt securities,
as their names and addresses appear in the security
register, without cost to the holders, copies of the
annual reports and quarterly reports that we would
have been required to file with the SEC pursuant to
Sections 13 or 15(d) of the Exchange Act if we were
subject to those Sections; and
- file with the trustee copies of the annual reports,
quarterly reports and other documents that we would
have been required to file with the SEC pursuant to
Sections 13 or 15(d) of the Exchange Act if we were
subject to those Sections; and
o if our filing the documents with the SEC is not permitted
under the Exchange Act, promptly upon written request and
payment of the reasonable cost of duplication and delivery,
supply copies of the documents to any prospective holder.
Events of Default, Notice and Waiver
Each indenture provides that the following events are "events of
default" with respect to any issued series of debt securities:
o default for 30 days in the payment of any installment of
interest or additional amounts payable on any debt security of
the series;
o default in the payment of the principal of, or any premium or
make-whole amount on any debt security of the series at its
maturity;
o default in making any sinking fund payment as required for any
debt security of the series;
o default in the performance of any other covenant of United
Dominion contained in the indenture, other than a covenant
added to the indenture solely for the benefit of a series of
debt securities issued under the indenture other than the
series, continued for 60 days after written notice as provided
in the indenture;
o default under any bond, debenture, note, mortgage, indenture
or instrument under which there may be issued or by which
there may be secured or evidenced any indebtedness for money
borrowed by United Dominion, or by any subsidiary, the
repayment of which we have guaranteed or for which we are
directly responsible or liable as obligor or guarantor, having
an aggregate principal amount outstanding of at least
$10,000,000, whether the indebtedness now exists or will later
be created, which default will have resulted in the
indebtedness being declared due and payable prior to the date
on which it would otherwise have become due and payable,
without the acceleration having been rescinded or annulled
within 10 days after written notice as provided in the
indenture;
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o the entry by a court of competent jurisdiction of one or more
judgments, orders or decrees against United Dominion or any
subsidiary in an aggregate amount, excluding amounts covered
by insurance, in excess of $10,000,000 and those judgments,
orders or decrees remain undischarged, unstayed and
unsatisfied in an aggregate amount, excluding amounts covered
by insurance, in excess of $10,000,000 for a period of 30
consecutive days;
o certain events of bankruptcy, insolvency or reorganization, or
court appointment of a receiver, liquidator or trustee of
United Dominion or any significant subsidiary or for all or
substantially all of either of their property; and
o any other event of default provided with respect to the series
of debt securities.
The term "significant subsidiary" means each significant subsidiary, as
defined in Regulation S-X promulgated under the Securities Act, of United
Dominion.
If an event of default under either indenture with respect to debt
securities of any series at the time outstanding occurs and is continuing, then
in every case the trustee or the holders of not less than 25% in principal
amount of the outstanding debt securities of that series may declare the
principal amount, or, if the debt securities of that series are original issue
discount securities or indexed securities, the portion of the principal amount
as may be specified in their terms, of, and any make-whole amount on, all of the
debt securities of that series to be due and payable immediately by written
notice to United Dominion, and to the trustee if given by the holders. However,
at any time after the declaration of acceleration with respect to debt
securities of the series, or of all debt securities then outstanding under the
applicable indenture, as the case may be, has been made, but before a judgment
or decree for payment of the money due has been obtained by the trustee, the
holders of not less than a majority in principal amount of the outstanding debt
securities of the series, or of all debt securities then outstanding under the
applicable indenture, as the case may be, may rescind and annul the declaration
and its consequences if:
o United Dominion will have deposited with the trustee all
required payments of the principal of and any premium or
make-whole amount and interest, and any additional amounts, on
the debt securities of the series, or of all debt securities
then outstanding under the applicable indenture, as the case
may be, plus certain fees, expenses, disbursements and
advances of the trustee; and
o all events of default, other than the nonpayment of
accelerated principal, or specified portion thereof and any
premium or make-whole amount, or interest, with respect to the
debt securities of the series, or of all debt securities then
outstanding under the applicable indenture, as the case may
be, have been cured or waived as provided in the indenture.
Each indenture also provides that the holders of not less than a
majority in principal amount of the outstanding debt securities of any series,
or of all debt securities then outstanding under the applicable indenture, as
the case may be, may waive any past default with respect to the series and its
consequences, except a default:
o in the payment of the principal of, or any premium or
make-whole amount, or interest or additional amounts payable
on any debt security of the series; or
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o in respect of a covenant or provision contained in the
applicable indenture that cannot be modified or amended
without the consent of the holder of each affected outstanding
debt security.
Each trustee is required to give notice to the holders of debt
securities within 90 days of a default under the applicable indenture. However,
the trustee may withhold notice to the holders of any series of debt securities
of any default with respect to that series, except a default in the payment of
the principal of, or any premium or make-whole amount, or interest or additional
amounts payable, on any debt security of the series or in the payment of any
sinking fund installment in respect of any debt security of the series, if the
trustee considers the withholding to be in the interest of the holders.
Each indenture provides that no holders of debt securities of any
series may institute any proceedings, judicial or otherwise, with respect to the
indenture or for any remedy thereunder, except in the case of failure of the
trustee for 60 days to act after it has received a written request to institute
proceedings in respect of an event of default from the holders of not less than
25% in principal amount of the outstanding debt securities of the series, as
well as an offer of reasonable indemnity This provision will not prevent,
however, any holder of debt securities from instituting suit for the enforcement
of payment of the principal of, and any premium or make-whole amount, interest
on and additional amounts payable with respect to, the debt securities at their
respective due dates.
Modification of the Indentures
United Dominion and the applicable trustee may modify and amend either
indenture with the consent of the holders of not less than a majority in
principal amount of all outstanding debt securities issued under the indenture
affected by the modification or amendment. However, we must have the consent of
the holders of all affected outstanding debt securities to:
o change the stated maturity of the principal of, or any premium
or make-whole amount, or any installment of principal of or
interest or additional amounts payable on, any debt security;
o reduce the principal amount of, or the rate or amount of
interest on, or any premium or make-whole amount payable on
redemption of, or any additional amounts payable with respect
to, any debt security, or reduce the amount of principal of an
original issue discount security or make-whole amount, if any,
that would be due and payable upon declaration of acceleration
of its maturity or would be provable in bankruptcy, or
adversely affect any right of repayment of the holder of any
debt security;
o change the place of payment, or the coin or currency, for
payment of principal of, and any premium or make-whole amount,
or interest on, or any additional amounts payable with respect
to, a debt security;
o impair the right to institute suit for the enforcement of any
payment on or with respect to any debt security;
o reduce the percentage of outstanding debt securities of any
series necessary to modify or amend the applicable indenture,
to waive compliance with any provisions of that indenture or
any defaults and consequences thereunder or to reduce the
quorum or voting requirements set forth in the indenture; or
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o modify any of the foregoing provisions or any of the
provisions relating to the waiver of certain past defaults or
certain covenants, except to increase the required percentage
to effect the action or to provide that certain other
provisions may not be modified or waived without the consent
of the holder of the debt security.
The holders of not less than a majority in principal amount of
outstanding debt securities issued under either indenture have the right to
waive our compliance with some covenants in the indenture.
Subordination
Upon any distribution to our creditors in a liquidation, dissolution or
reorganization, the payment of the principal of and interest on the subordinated
debt securities will be subordinated to the extent provided in the Subordinated
Indenture in right of payment to the prior payment in full of all senior debt.
Our obligation to make payment of the principal and interest on the subordinated
debt securities will not otherwise be affected.
No payment of principal or interest may be made on the subordinated
debt securities at any time if a default on senior debt exists that permits the
holders of the senior debt to accelerate its maturity and the default is the
subject of judicial proceedings or we receive notice of the default. After all
senior debt is paid in full and until the subordinated debt securities are paid
in full, holders will be subrogated to the rights of holders of senior debt to
the extent that distributions otherwise payable to holders have been applied to
the payment of senior debt. By reason of this subordination, in the event of a
distribution of assets upon insolvency, certain of our general creditors may
recover more, ratably, than holders of the subordinated debt securities.
Senior debt is defined in the Subordinated Indenture as the principal
of and interest on, or substantially similar payments to be made by United
Dominion in respect of, the following, whether outstanding at the date of
execution of the Subordinated Indenture or thereafter incurred, created or
assumed:
o indebtedness of United Dominion for money borrowed or
represented by purchase-money obligations;
o indebtedness of United Dominion evidenced by notes,
debentures, or bonds, or other securities issued under the
provisions of an indenture, fiscal agency agreement or other
instrument;
o obligations of United Dominion as lessee under leases of
property either made as part of any sale and leaseback
transaction to which United Dominion is a party or otherwise;
o indebtedness of partnerships and joint ventures that is
included in the consolidated financial statements of United
Dominion;
o indebtedness, obligations and liabilities of others in respect
of which United Dominion is liable contingently or otherwise
to pay or advance money or property or as guarantor, endorser
or otherwise or which United Dominion has agreed to purchase
or otherwise acquire; and
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o any binding commitment of United Dominion to fund any real
estate investment or to fund any investment in any entity
making a real estate investment, in each case other than the
following:
- any indebtedness, obligation or liability referred to
in the above bullet points as to which, in the
instrument creating or evidencing the same pursuant
to which the same is outstanding, it is provided that
the indebtedness, obligation or liability is not
superior in right of payment to the subordinated debt
securities or ranks pari passu with the subordinated
debt securities;
- any indebtedness, obligation or liability that is
subordinated to indebtedness of United Dominion to
substantially the same extent as or to a greater
extent than the subordinated debt securities are
subordinated; and
- the subordinated debt securities.
At September 30, 1999, our senior debt aggregated approximately $2.2
billion.
Discharge, Defeasance and Covenant Defeasance
Under each indenture, United Dominion may discharge certain obligations
to holders of any series of debt securities issued under an indenture that have
not already been delivered to the applicable trustee for cancellation and that
either have become due and payable or will become due and payable within one
year, or scheduled for redemption within one year, by irrevocably depositing
with the applicable trustee, in trust, funds in the currency or currencies,
currency unit or units or composite currency or currencies in which the debt
securities are payable in an amount sufficient to pay the entire indebtedness on
the debt securities in respect of principal, and any premium or make-whole
amount, and interest and any additional amounts payable to the date of the
deposit, if the debt securities have become due and payable, or to the stated
maturity or redemption date, as the case may be.
Each indenture provides that, if the provisions of its Article Fourteen
are made applicable to the debt securities of or within any series pursuant the
indenture, United Dominion may elect:
o "defeasance," which is to defease and be discharged from any
and all obligations with respect to the debt securities,
except for the obligation to pay additional amounts, if any,
upon the occurrence of certain events of tax, assessment or
governmental charge with respect to payments on the debt
securities and the obligations to register the transfer or
exchange of the debt securities, to replace temporary or
mutilated, destroyed, lost or stolen debt securities, to
maintain an office or agency in respect of the debt securities
and to hold moneys for payment in trust; or
o "covenant defeasance," which is to be released from our
obligations with respect to the debt securities under
provisions of each indenture described under "Covenants
Applicable to Our Senior Debt Securities" and "Covenants
Applicable to All Debt Securities," or, if provided pursuant
to Section 301 of each indenture, our obligations with respect
to any other covenant, and any omission to comply with the
obligations will not constitute a default or an event or
default with respect to the debt securities.
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In either case upon our irrevocable deposit with the applicable trustee, in
trust, of an amount, in the currency or currencies, currency unit or currency
units or composite currency or currencies in which the debt securities are
payable at stated maturity, or Government Obligations (as defined below), or
both, applicable to the debt securities that through the scheduled payment of
principal and interest in accordance with their terms will provide money in an
amount sufficient to pay the principal of, and any premium or make-whole amount,
and interest on the debt securities, and any mandatory sinking fund or analogous
payments thereon, on the scheduled due dates therefor.
Such a trust may only be established if, among other things, United
Dominion has delivered to the applicable trustee an opinion of counsel, as
specified in each indenture, to the effect that the holders of the debt
securities will not recognize income, gain or loss for United States federal
income tax purposes as a result of the defeasance or covenant defeasance and
will be subject to United States federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if the defeasance
or covenant defeasance had not occurred. In the case of defeasance, the opinion
of counsel must refer to and be based upon a ruling of the Internal Revenue
Service or a change in applicable United States federal income tax laws
occurring after the date of the indenture.
"Government Obligations" means securities that are:
o direct obligations of the United States of America or the
government that issued the foreign currency in which the debt
securities of a particular series are payable, for the payment
of which its full faith and credit is pledged; or
o obligations of a person controlled or supervised by and acting
as an agency or instrumentality of the United States of
America or the government that issued the foreign currency in
which the debt securities of the series are payable, the
payment of which is unconditionally guaranteed as a full faith
and credit obligation by the United States of America or any
other government, which, in either case, are not callable or
redeemable at the option of the issuer, and will also include
a depository receipt issued by a bank or trust company as
custodian with respect to any Government Obligation or a
specific payment of interest on or principal of any Government
Obligation held by the custodian for the account of the holder
of a depository receipt, provided that, except as required by
law, the custodian is not authorized to make any deduction
from the amount payable to the holder of the depository
receipt from any amount received by the custodian in respect
of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation
evidenced by the depository receipt.
Unless otherwise provided in the prospectus supplement, if after United
Dominion has deposited funds and/or Government Obligations to effect defeasance
or covenant defeasance with respect to debt securities of any series,
o the holder of a debt security of the series is entitled to,
and does, elect pursuant to Section 301 of the indenture or
the terms of the debt security to receive payment in a
currency, currency unit or composite currency other than that
in which the deposit has been made in respect of the debt
security; or
o a Conversion Event (as defined below) occurs in respect of the
currency, currency unit or composite currency in which the
deposit has been made, the indebtedness represented by the
debt security will be deemed to have been, and will be, fully
discharged and satisfied through the payment of the principal
of, and any premium or make-whole amount, and interest on the
debt security as they become due out of the proceeds yielded
by converting the amount deposited in respect of the debt
security into the currency, currency unit or composite
currency in which the debt security becomes payable as a
result of the election or cessation of usage based on the
applicable market exchange rate.
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"Conversion Event" means the cessation of use of:
o a currency, currency unit or composite currency, other than
the ECU or other currency unit, both by the government of the
country that issued the currency and for the settlement of
transactions by a central bank or other public institutions of
or within the international banking community;
o the ECU both within the European Monetary System and for the
settlement of transactions by public institutions of or within
the European Communities; or
o any currency unit or composite currency other than the ECU for
the purposes for which it was established.
Unless otherwise provided in the prospectus supplement, all payments of
principal of, and any premium or make-whole amount, and interest on any debt
security that is payable in a foreign currency that ceases to be used by its
government of issuance will be made in United States dollars.
If United Dominion effects covenant defeasance with respect to any debt
securities and those debt securities are declared due and payable because of the
occurrence of any event of default, the amount in the currency, currency unit or
composite currency in which the debt securities are payable, and Government
Obligations on deposit with the trustee, will be sufficient to pay amounts due
on the debt securities at the time of their stated maturity but may not be
sufficient to pay amounts due on the debt securities at the time of the
acceleration resulting from the event of default. This situation will not apply
in the case of an event of default described in the fourth bullet point under
"--Events of Default, Notice and Waiver" of either indenture, which sections
would no longer be applicable to the debt securities or described in the last
bullet point under "--Events of Default, Notice and Waiver" with respect to a
covenant as to which there has been covenant defeasance. However, we would
remain liable to make payment of the amounts due at the time of acceleration.
The prospectus supplement may further describe the provisions, if any,
permitting defeasance or covenant defeasance, including any modifications to the
provisions described above, with respect to the debt securities of or within a
particular series.
Conversion Rights
The terms and conditions, if any, upon which the debt securities are
convertible into United Dominion capital stock will be set forth in the
applicable prospectus supplement. The terms will include:
o whether the debt securities are convertible into capital
stock;
o the conversion price, or its manner of calculation;
o the conversion period;
o provisions as to whether conversion will be at the option of
the holders or United Dominion;
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o the events requiring an adjustment of the conversion price;
and
o provisions affecting conversion in the event of the redemption
of the debt securities.
Book-Entry System
We may issue the debt securities of a series as one or more fully
registered global securities. We will deposit the global securities with, or on
behalf of, a depository bank identified in the prospectus supplement relating to
the series. We will register the global securities in the name of the depository
bank or its nominee. In that case, one or more global securities will be issued
in a denomination or aggregate denominations equal to the aggregate principal
amount of outstanding debt securities of the series represented by the global
security or securities. Until any global security is exchanged in whole or in
part for debt securities in definitive certificated form, the depository bank or
its nominee may not transfer the global certificate except to each other,
another nominee or to their successors and except as described in the applicable
prospectus supplement.
The prospectus supplement will describe the specific terms of the
depository arrangement with respect to a series of debt securities that a global
security will represent. We anticipate that the following provisions will apply
to all depository arrangements.
Upon the issuance of any global security, and the deposit of the global
security with or on behalf of the depository bank for the global security, the
depository bank will credit, on its book-entry registration and transfer system,
the respective principal amounts of the debt securities represented by the
global security to the accounts of institutions, also referred to as
"participants," that have accounts with the depository bank or its nominee. The
accounts to be credited will be designated by the underwriters or agents
engaging in the distribution or placement of the debt securities or by us, if we
offer and sell the debt securities directly. Ownership of beneficial interests
in the global security will be limited to participants or persons that may hold
interests through participants.
Ownership of beneficial interests by participants in the global
security will be shown by book-keeping entries on, and the transfer of that
ownership interest will be effected only through book-keeping entries to,
records maintained by the depository bank or its nominee for the global
security. Ownership of beneficial interests in the global security by persons
that hold through participants will be shown by book-keeping entries on, and the
transfer of that ownership interest among or through the participants will be
effected only through book-keeping entries to, records maintained by the
participants.
The laws of some jurisdictions require that some of the purchasers of
securities take physical delivery of the securities in definitive certificated
form rather than book-entry form. Such laws may impair the ability to own,
transfer or pledge beneficial interests in any global security.
So long as the depository bank for a global security or its nominee is
the registered owner of the global security, the depository bank or the nominee,
as the case may be, will be considered the sole owner or holder of the debt
securities represented by the global security for all purposes under the
indenture. Except as described below or otherwise specified in the applicable
prospectus supplement, owners of beneficial interests in a global security:
o will not be entitled to have debt securities of the series
represented by the global security registered in their names;
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o will not receive or be entitled to receive physical delivery
of debt securities of the series in definitive certificated
form; and
o will not be considered the holders thereof for any purposes
under the indenture.
Accordingly, each person owning a beneficial interest in the global
security must rely on the procedures of the depository bank and, if the person
is not a participant, on the procedures of the participant through which the
person directly or indirectly owns its interest, to exercise any rights of a
holder under the indenture. The indenture provides that the depository bank may
grant proxies and otherwise authorize participants to give or take any request,
demand, authorization, direction, notice, consent, waiver or other action that a
holder is entitled to give or take under the indenture.
We understand that under existing industry practices, if we request any
action of holders or any owner of a beneficial interest in the global security
desires to give any notice or take any action that a holder is entitled to give
or take under the indenture, the depository bank for the global security would
authorize the participants holding the relevant beneficial interest to give
notice or take action, and the participants would authorize beneficial owners
owning through the participants to give notice or take action or would otherwise
act upon the instructions of beneficial owners owning through them.
Principal and any premium and interest payments on debt securities
represented by a global security registered in the name of a depository bank or
its nominee will be made to the depository bank or its nominee, as the case may
be, as the registered owner of the global security. None of us, the trustee or
any paying agent for the debt securities will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in any global security or for maintaining,
supervising or reviewing any records relating to the beneficial ownership
interests.
We expect that the depository bank for any series of debt securities
represented by a global security, upon receipt of any payment of principal,
premium or interest, will credit immediately participants' accounts with
payments in amounts proportionate to their respective beneficial interests in
the principal amount of the global security as shown on the records of the
depository bank. We also expect that payments by participants to owners of
beneficial interests in the global security or securities held through the
participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers registered
in "street name," and will be the responsibility of the participants.
If the depository bank for any series of debt securities represented by
a global security is at any time unwilling or unable to continue as depository
bank and we do not appoint a successor depository bank within 90 days, we will
issue the debt securities in definitive certificated form in exchange for the
global security. In addition, we may at any time and in our sole discretion
determine not to have the debt securities of a series represented by one or more
global securities and, in the event, will issue debt securities of the series in
definitive certificated form in exchange for the global security representing
the series of debt securities.
Debt securities of the series issued in definitive certificated form
will, except as described in the applicable prospectus supplement, be issued in
denominations of $1,000 and integral multiples thereof and will be issued in
registered form.
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Trustees
First Union National Bank is the trustee under the Senior Indenture.
Crestar Bank is the trustee under the Subordinated Indenture. Both First Union
National Bank and Crestar Bank have lending relationships with us.
DESCRIPTION OF OUR CAPITAL STOCK
General
The following is a summary of some of the important terms of our
capital stock. You should review the applicable Virginia law and our Charter and
our Restated Bylaws for a more complete description of our capital stock.
United Dominion is authorized to issue 150,000,000 shares of common
stock, $1 par value, and 25,000,000 shares of preferred stock, no par value. The
preferred stock is issuable in series designated by our Board of Directors,
which has designated four series: 9.25% Series A Cumulative Redeemable Preferred
Stock, 8.60% Series B Cumulative Redeemable Preferred Stock , Series C Junior
Participating Cumulative Redeemable Preferred Stock and Series D Cumulative
Convertible Redeemable Preferred Stock. At November 9, 1999, there were
outstanding 102,996,532 shares of common stock, 4,200,000 shares of Series A
Preferred Stock, 6,000,000 shares of Series B Preferred Stock and 8,000,000
shares of Series D Preferred Stock. No shares of Series C Preferred Stock have
been issued, and we will not issue any shares of Series C Preferred Stock except
upon the exercise of rights as described below under "--Rights to Purchase
Series C Preferred Stock." We will not issue additional shares of any
outstanding series of preferred stock.
Common Stock
Holders of our common stock are entitled to receive dividends when and
as declared by the Board of Directors after payment of, or provision for, full
cumulative dividends on and any required redemptions of shares of our preferred
stock then outstanding. Holders of our common stock have one vote per share and
non-cumulative voting rights, which means that holders of more than 50% of the
shares voting can elect all of the directors if they choose to do so, and, in
the event, the holders of the remaining shares will not be able to elect any
directors. In the event of our voluntary or involuntary liquidation or
dissolution, holders of our common stock are entitled to share ratably in our
distributable assets remaining after satisfaction of the prior preferential
rights of our preferred stock and the satisfaction of all of our debts and
liabilities. Holders of our common stock do not have preemptive rights.
The dividend and liquidation rights of holders of our common stock are
specifically limited by the terms of the outstanding preferred stock, which
provide that no dividends will be declared or paid or on the common stock unless
the accrued dividends on each series of outstanding preferred stock have been
fully paid or declared and set apart for payment, and that in the event of any
liquidation, dissolution or winding up of United Dominion, the holders of each
series of preferred stock will be entitled to receive out of our assets
available for distribution to shareholders the liquidation preference of that
series before any amount is distributed to common shareholders.
The transfer agent for our common stock is ChaseMellon Shareholder
Services, L.L.C., Ridgefield Park, New Jersey. Our common stock is traded on the
NYSE under the symbol "UDR."
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Preferred Stock
The following description sets forth general terms and provisions of
our preferred stock. Specific terms of any series of preferred stock offered by
a prospectus supplement will be described in that prospectus supplement. You
should review our Charter for a more complete description of the preferences,
limitations and relative rights of a particular series of preferred stock.
General. Under our Charter, the Board of Directors is authorized,
without further shareholder action, to provide for the issuance of up to
25,000,000 shares of preferred stock, in one or more series, with the voting
powers and with the designations, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions, as the Board of Directors will approve.
Our preferred stock will have the dividend, liquidation, redemption,
conversion and voting rights set forth below unless otherwise provided in the
prospectus supplement relating to a particular series of preferred stock. In an
offering of a series of our preferred stock, the prospectus supplement will
provide specific terms of the series, including:
o the title and liquidation preference per share of the
preferred stock and the number of shares offered;
o the price at which the series will be issued;
o the dividend rate or method of its calculation, the dates on
which dividends will be payable and the dates from which
dividends will commence to accumulate;
o any redemption or sinking fund provisions of the series;
o any conversion provisions of the series; and
o any additional dividend, liquidation, redemption, sinking fund
and other rights, preferences, privileges, limitations and
restrictions of the series.
Our preferred stock will, when issued, be fully paid and nonassessable.
Unless otherwise specified in the prospectus supplement relating to a particular
series of preferred stock, each series will rank on a parity as to dividends and
distributions in the event of a liquidation with each other series of preferred
stock and, in all cases, will be senior to the common stock.
Dividend Rights. Holders of preferred stock of each series will be
entitled to receive, when declared by the Board of Directors, cash dividends at
the rates and on the dates as set forth in the prospectus supplement relating to
the series of preferred stock. The rate may be fixed or variable or both and may
be cumulative, noncumulative or partially cumulative.
If the prospectus supplement provides, as long as any shares of
preferred stock are outstanding, no dividends will be declared or paid or any
distributions be made on the common stock, other than a dividend payable in
common stock, unless the accrued dividends on each series of preferred stock
have been fully paid or declared and set apart for payment and United Dominion
will have set apart all amounts, if any, required to be set apart for all
sinking funds, if any, for each series of preferred stock.
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If the prospectus supplement so provides, when dividends are not paid
in full upon any series of preferred stock and any other series of preferred
stock ranking on a parity as to dividends with the series of preferred stock,
all dividends declared upon the series of preferred stock and any other series
of preferred stock ranking on a parity as to dividends will be declared pro rata
so that the amount of dividends declared per share on the series of preferred
stock and the other series will in all cases bear to each other the same ratio
that accrued dividends per share on the series of preferred stock and the other
series bear to each other.
Each series of preferred stock will be entitled to dividends as
described in the prospectus supplement relating to the series, which may be
based upon one or more methods of determination. Different series of preferred
stock may be entitled to dividends at different dividend rates or based upon
different methods of determination. Except as provided in the applicable
prospectus supplement, no series of preferred stock will be entitled to
participate in our earnings or assets.
Rights Upon Liquidation. In the event of any voluntary or involuntary
liquidation, dissolution or winding up of United Dominion, the holders of each
series of preferred stock will be entitled to receive out of our assets
available for distribution to shareholders the amount stated or determined on
the basis set forth in the prospectus supplement relating to the series. This
distribution may include accrued dividends, if the liquidation, dissolution or
winding up is involuntary. If the liquidation, dissolution or winding up is
voluntary the distribution may equal the current redemption price per share
provided for the series set forth in the prospectus supplement, otherwise than
for the sinking fund, if any, provided for the series. Any preferential basis
for the distribution will be set forth in the prospectus supplement.
If, upon any voluntary or involuntary liquidation, dissolution or
winding up of United Dominion, the amounts payable with respect to preferred
stock of any series and any other shares of stock of United Dominion ranking as
to any such distribution on a parity with the series of preferred stock are not
paid in full, the holders of preferred stock of the series and of the other
shares will share ratably in any distribution of our assets in proportion to the
full respective preferential amounts to which they are entitled or on such other
basis as is set forth in the applicable prospectus supplement. The rights, if
any, of the holders of any series of preferred stock to participate in our
remaining assets after the holders of other series of preferred stock have been
paid their respective specified liquidation preferences upon any liquidation,
dissolution or winding up of United Dominion will be described in the prospectus
supplement relating to the series.
Redemption. A series of preferred stock may be redeemable, in whole or
in part, at our option, and may be subject to mandatory redemption pursuant to a
sinking fund, in each case upon terms, at the times, the redemption prices and
for the types of consideration set forth in the prospectus supplement relating
to the series. The prospectus supplement relating to a series of preferred stock
that is subject to mandatory redemption will specify the number of shares of the
series that we will redeem in each year commencing after a specified date at a
specified redemption price per share, together with an amount equal to any
accrued and unpaid dividends to the date of redemption.
If, after giving notice of redemption to the holders of a series of
preferred stock, United Dominion deposits with a designated bank funds
sufficient to redeem the preferred stock, then from and after the deposit, all
shares called for redemption will no longer be outstanding for any purpose,
other than the right to receive the redemption price and the right to convert
the shares into other classes of capital stock of United Dominion. The
prospectus supplement will set forth the redemption price relating to a
particular series of preferred stock.
Except as indicated in the applicable prospectus supplement, the
preferred stock is not subject to any mandatory redemption at the option of the
holder.
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Sinking Fund. The prospectus supplement for any series of preferred
stock will state the terms, if any, of a sinking fund for the purchase or
redemption of that series.
Conversion Rights. The prospectus supplement for any series of
preferred stock will state the terms, if any, on which shares of that series are
convertible into shares of common stock or another series of preferred stock.
The preferred stock will have no preemptive rights.
Voting Rights. Except as indicated in the prospectus supplement
relating to a particular series of preferred stock, or except as expressly
required by Virginia law, a holder of preferred stock will not be entitled to
vote. Except as indicated in the prospectus supplement relating to a particular
series of preferred stock, in the event United Dominion issues full shares of
any series of preferred stock, each share will be entitled to one vote on
matters on which holders of the series of preferred stock are entitled to vote.
Under Virginia law, the affirmative vote of the holders of a majority
of the outstanding shares of all series of preferred stock, voting as a separate
voting group, will be required for:
o the authorization of any class of stock ranking prior to or on
parity with preferred stock or the increase in the number of
authorized shares of any such stock;
o any increase in the number of authorized shares of preferred
stock; and
o certain amendments to our Charter that may be adverse to the
rights of outstanding preferred stock.
Transfer Agent and Registrar. The prospectus supplement will state our
selection for the transfer agent, registrar and dividend disbursement agent for
a series of preferred stock. The registrar for shares of preferred stock will
send notices to shareholders of any meetings at which holders of preferred stock
have the right to vote on any matter.
Rights to Purchase Series C Preferred Stock
Pursuant to our shareholder rights plan, each share of common stock has
attached to it one right to purchase from United Dominion one one-thousandth of
a share of Series C Preferred Stock. Each one one-thousandth of a share of
Series C Preferred Stock is structured to be the equivalent of one share of
common stock. The exercise price of the rights is $45.00, subject to adjustment.
For a discussion of the impact of our shareholder rights plan, you should refer
to the subsection entitled "Risk of Investment -- The Ability of Our
Shareholders to Control Our Policies and Affect a Change of Control of Our
Company is Limited, Which May Not Be in Our Shareholders' Best Interests."
The rights will separate from the common stock and a distribution of
certificates evidencing the rights will occur upon the earlier of:
o 10 business days following a public announcement that a person
or group of related persons has acquired, or obtained the
right to acquire, beneficial ownership of more than 15% of the
outstanding shares of common stock; or
o 10 business days following the commencement of a tender offer
or exchange offer that would result in a person or group
beneficially owning more than 15% of the outstanding shares of
common stock.
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The rights will expire at the close of business on February 4, 2008,
unless we redeem or exchange them earlier.
Series C Preferred Stock
The Series C Preferred Stock is junior to all other outstanding series
of preferred stock in respect of rights to receive dividends and to participate
in distributions or payments in the event of our liquidation, dissolution or
winding up. The Series C Preferred Stock is senior to the common stock and, as
to dividends and upon liquidation, any of our other capital stock that ranks
junior to the Series C Preferred Stock.
Holders of shares of the Series C Preferred Stock are be entitled to
receive cumulative preferential cash dividends payable quarterly in an amount
per share equal to:
o the greater of
- $.01 or
- 1,000 times the aggregate per share amount of all
cash dividends; and
o 1,000 times the aggregate per share amount, payable in kind,
of all non-cash dividends or other distributions, other than
dividends payable in shares of common stock, declared on the
common stock since the immediately preceding quarterly
dividend payment date, or, with respect to the first quarterly
dividend payment date, since the first issuance of any share
or fraction of a share of Series C Preferred Stock.
In the event of any liquidation, dissolution or winding up of United
Dominion, the holders of shares of Series C Preferred Stock are entitled to be
paid out of our assets legally available for distribution to our shareholders a
liquidation preference of $1,000 per share, plus accrued and unpaid dividends
thereon to the date of payment, of which is referred to as the "Series C
Preferred Liquidation Preference." After the payment to the holders of the
shares of the Series C Preferred Stock of the full Series C Preferred
Liquidation Preference, the holders of the Series C Preferred Stock as such
shall have no right or claim to any of the remaining assets of the corporation
until the holders of common stock shall have received an amount per share,
referred to as the "common adjustment," equal to the quotient obtained by
dividing the Series C Preferred Liquidation Preference by 1,000. In the event
that there are not sufficient assets available after payment in full of the
Series C Preferred Liquidation Preference to permit payment in full of the
common adjustment, then the remaining assets shall be distributed ratably to the
holders of the common stock.
The outstanding shares of Series C Preferred Stock may be redeemed at
the option of the Board of Directors as a whole, but not in part, at any time,
or from time to time, at a redemption price per share equal to 1,000 times the
Average Market Value of the common stock, plus all accrued and unpaid dividends
to and including the date fixed for redemption. The "Average Market Value" is
the average of the closing sale prices of a share of the common stock during the
30-day period immediately preceding the date before the redemption date quoted
on the Composite Tape for New York Stock Exchange Listed Stocks, or, if the
common stock is not quoted on the Composite Tape, on The New York Stock
Exchange, or, if the common stock is not listed on such exchange, on the
principal United States registered securities exchange on which the common stock
is listed, or, if the common stock is not listed on any such exchange, the
average of the closing bid quotations with respect to a share of common stock
during such 30-day period on The Nasdaq Stock Market, or if no such quotations
are available, the fair market value of a share of common stock as determined by
the Board of Directors in good faith.
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Each share of Series C Preferred Stock entitles its holder to 1,000
votes on all matters submitted to a vote of our shareholders. The holders of
shares of Series C Preferred Stock and the holders of shares of common stock
vote together as one voting group on all those matters.
Whenever dividends on any shares of Series C Preferred Stock are in
arrears for six or more consecutive quarterly periods, our entire Board of
Directors will be increased by two directors and the holders of Series C
Preferred Stock, voting separately as a class with all other series of preferred
stock having like voting rights, may vote for the election of two additional
directors of United Dominion until all dividend arrearages have been fully paid.
The dividend rate on the Series C Preferred Stock , the Series C
Preferred Liquidation Preference, the Common Adjustment, the Series C Preferred
Redemption Price and the number of votes per share of Series C Preferred Stock
are all subject to adjustment upon the declaration of any dividend payable in
common stock, subdivision of the outstanding common stock or combination of the
outstanding shares of common stock into a smaller number of shares.
Dividend Restrictions
A covenant in our loan agreement with a group of insurance company
lenders effectively prohibits us from declaring or paying dividends if, after
giving effect to the declaration or payment,
o a default or "Event of Default" under the agreement will occur
and be continuing,
o we would be prohibited from incurring debt under other
covenants in the agreement, and
o the dividends and other "Restricted Payments," as defined in
the loan agreement, declared during the same fiscal year as
the dividends would exceed the sum of "Cash Flow," as defined
in the loan agreement, from the beginning of that fiscal year
to and including the last day of the completed fiscal quarter
immediately preceding the dividend payment date, and the net
cash proceeds received by us from the issuance or sale of
capital stock after February 24, 1993, plus $20,000,000, minus
the total of the amounts, if any, by which "Restricted
Payments" declared during each fiscal year after December 31,
1992, exceed "Cash Flow" for the applicable fiscal year.
In addition, a covenant in our credit agreement with a group of bank
lenders prohibits the payment of dividends and distributions on our common stock
in excess of 95% of our "Funds From Operations," as defined in the credit
agreement, during any period, excluding dividends paid as a result of
extraordinary gains which are excluded from the "Funds From Operations"
calculation.
Despite these covenants, we may pay dividends required to maintain our
qualification as a REIT under the Internal Revenue Code.
Affiliated Transactions
The Virginia Stock Corporation Act contains provisions governing
"affiliated transactions" designed to deter uninvited takeovers of Virginia
corporations. These provisions, with several exceptions discussed below, require
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approval of material acquisition transactions between a Virginia corporation and
any interested shareholders by the holders of at least two-thirds of the
remaining voting shares. An interested shareholder is any holder of more than
10% of any class of its outstanding voting shares.
For three years following the time that the interested shareholder
becomes an owner of 10% of the outstanding voting shares, Virginia corporations
cannot engage in an affiliated transaction with the interested shareholder
without approval of two-thirds of the voting shares other than those shares
beneficially owned by the interested shareholder, and majority approval of the
disinterested directors. At the expiration of the three year period, the statute
requires approval of affiliated transactions by two-thirds of the voting shares
other than those beneficially owned by the interested shareholder absent an
exception. The principal exceptions to the special voting requirement apply to
transactions proposed after the three year period has expired and require either
that the transaction be approved by a majority of the corporation's
disinterested directors or that the transaction satisfy the fair-price
requirements of the law.
The Virginia Stock Corporation Act also provides that shares acquired
in a transaction that would cause the acquiring person's voting strength to
cross any of three thresholds, namely, 20%, 33% or 50%, have no voting rights
unless granted by a majority vote of shares not owned by the acquiring person or
any officer or employee-director of United Dominion. An acquiring person may
require that we hold a special meeting of shareholders to consider the matter
within 50 days of its request.
Redemption and Restrictions on Transfer
In order to preserve our status as a REIT, we can redeem or stop the
transfer of our shares. Our Charter provides that United Dominion is organized
to qualify as a REIT. Because the concentration of more than 50% in value of the
direct or indirect ownership of our shares in five or fewer individual
shareholders during the last six months of any year would result in our
disqualification as a REIT, our Charter provides that United Dominion will have
the power:
o to redeem that number of concentrated shares sufficient in the
opinion of our Board of Directors to maintain or bring the
direct or indirect ownership of shares into conformity with
the requirements of the federal income tax laws; and
o to stop the transfer of shares to any person whose acquisition
thereof would, in the opinion of our Board of Directors,
result in our disqualification as a REIT.
The per share redemption price of any shares that we redeem pursuant to
this provision will be the last reported sale price for the shares as of the
business day preceding the day on which the notice of redemption is given. The
Board of Directors can require shareholders to disclose in writing to us the
information with respect to ownership of our shares as the Board deems necessary
to comply with the REIT provisions of the federal income tax laws.
FEDERAL INCOME TAX CONSEQUENCES
OF UNITED DOMINION'S STATUS AS A REIT
The following sections summarize the federal income tax issues that
you, as a prospective holder of securities of United Dominion, may consider
relevant. Because this section is a summary, it does not address all of the tax
issues that may be important to you. In addition, this section does not address
the tax issues that may be important to certain types of security holders that
are subject to special treatment under the federal income tax laws, such as
insurance companies, tax-exempt organizations, financial institutions or
broker-dealers, and non-U.S. individuals and foreign corporations.
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The statements in this section are based on the current federal income
tax laws governing our qualification as a REIT. United Dominion cannot assure
you that new laws, interpretations thereof, or court decisions, any of which may
take effect retroactively, will not cause any statement in this section to be
inaccurate.
- --------------------------------------------------------------------------------
United Dominion urges you to consult your own tax advisor regarding the
specific tax consequences to you of investing in our securities and of our
election to be taxed as a REIT. Specifically, you should consult your own tax
advisor regarding the federal, state, local, foreign and other tax consequences
of such investment and election, and regarding potential changes in applicable
tax laws.
- --------------------------------------------------------------------------------
Taxation of United Dominion
United Dominion elected to be taxed as a REIT under the Internal
Revenue Code commencing with its taxable year ended December 31, 1972. We
believe that we have operated in a manner intended to qualify as a REIT since
our election to be a REIT, and we intend to continue to so operate. This section
discusses generally the laws governing the federal income tax treatment of a
REIT and its shareholders. These laws are highly technical and complex.
United Dominion's qualification as a REIT depends on our ability to
meet on a continuing basis qualification tests set forth in the federal tax
laws. Those qualification tests involve the percentage of income that United
Dominion earns from specified sources, the percentage of our assets that fall
within specified categories, the diversity of our share ownership, and the
percentage of our earnings that we distribute. The REIT qualification tests are
described in more detail below. For a discussion of the tax treatment of United
Dominion and our shareholders if United Dominion fails to qualify as a REIT, see
"--Failure to Qualify."
If United Dominion qualifies as a REIT, we generally will not be
subject to federal income tax on the taxable income that we distribute to our
shareholders. The benefit of this tax treatment is that it avoids the "double
taxation" at both the corporate and shareholder levels that generally results
from owning stock in a corporation. However, United Dominion will be subject to
federal tax in the following circumstances:
o United Dominion will pay federal income tax on taxable income,
including net capital gain, that we do not distribute to our
shareholders during, or within a specified time period after,
the calendar year in which the income is earned.
o United Dominion may be subject to the "alternative minimum
tax" on any items of tax preference that we do not distribute
or allocate to our shareholders.
o United Dominion will pay income tax at the highest corporate
rate on (A) net income from the sale or other disposition of
property acquired through foreclosure ("foreclosure property")
that it holds primarily for sale to customers in the ordinary
course of business and (B) other non-qualifying income from
foreclosure property.
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o United Dominion will pay a 100% tax on net income from sales
or other dispositions of property, other than foreclosure
property, that it holds primarily for sale to customers in the
ordinary course of business ("prohibited transactions").
o If United Dominion fails to satisfy the 75% gross income test
or the 95% gross income test (as described below under
"--Requirements for Qualification--Income Tests"), and
nonetheless continues to qualify as a REIT because we meet
other requirements, we will pay a 100% tax on (A) the gross
income attributable to the greater of the amounts by which we
fail the 75% and 95% gross income tests, multiplied by (B) a
fraction intended to reflect our profitability.
o If United Dominion fails to distribute during a calendar year
at least the sum of (A) 85% of our REIT ordinary income for
such year, (B) 95% of our REIT capital gain net income for
such year, and (C) any undistributed taxable income from prior
periods, we will pay a 4% excise tax on the excess of such
required distribution over the amount we actually distributed.
o United Dominion may elect to retain and pay income tax on our
net long-term capital gain.
o If United Dominion acquires any asset from a corporation
generally subject to full corporate-level tax in a merger or
other transaction in which we acquire a basis in the asset
that is determined by reference to the corporation's basis in
that or another asset, we will pay tax at the highest regular
corporate rate applicable if we recognize gain on the sale or
disposition of such asset during the 10-year period after we
acquire such asset. The amount of gain on which we will pay
tax is the lesser of (A) the amount of gain that we recognize
at the time of the sale or disposition and (B) the amount of
gain that we would have recognized if we had sold the asset at
the time we acquired the asset. The rule described in this
paragraph will apply assuming that United Dominion makes an
election under IRS Notice 88-19 upon our acquisition of an
asset from a C corporation.
Requirements for Qualification
A REIT is a corporation, trust, or association that meets the following
requirements:
1. it is managed by one or more trustees or directors;
2. its beneficial ownership is evidenced by transferable shares,
or by transferable certificates of beneficial interest;
3. it would be taxable as a domestic corporation, but for
provisions of federal income tax law defining a REIT;
4. it is neither a financial institution nor an insurance company
subject to specified provisions of the federal income tax law;
5. at least 100 persons are beneficial owners of its shares or
ownership certificates;
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6. not more than 50% in value of its outstanding shares or
ownership certificates is owned, directly or indirectly, by
five or fewer individuals, as defined in the federal income
tax laws to include certain entities, during the last half of
any taxable year;
7. it elects to be a REIT, or has made such election for a
previous taxable year, and satisfies all relevant filing and
other administrative requirements established by the Internal
Revenue Service that must be met to elect and maintain REIT
status;
8. it uses a calendar year for federal income tax purposes and
complies with the recordkeeping requirements of the federal
income tax laws; and
9. it meets other qualification tests, described below, regarding
the nature of its income and assets.
United Dominion must meet requirements 1 through 4, inclusive, during
our entire taxable year and must meet requirement 5 during at least 335 days of
a taxable year of 12 months, or during a proportionate part of a taxable year of
less than 12 months. If we comply with all the requirements for ascertaining the
ownership of our outstanding shares in a taxable year and have no reason to know
that we violated requirement 6, we will be deemed to have satisfied requirement
6 for such taxable year. For purposes of determining share ownership under
requirement 6, an "individual" generally includes a supplemental unemployment
compensation benefits plan, a private foundation, or a portion of a trust
permanently set aside or used exclusively for charitable purposes. An
"individual," however, generally does not include a trust that is a qualified
employee pension or profit sharing trust under the federal income tax laws, and
beneficiaries of such a trust will be treated as holding shares of United
Dominion's capital stock in proportion to their actuarial interests in the trust
for purposes of requirement 6.
United Dominion believes that we have issued sufficient common stock
with sufficient diversity of ownership to satisfy requirements 5 and 6 set forth
above. In addition, our Charter restricts the ownership and transfer of the
common stock so that United Dominion should continue to satisfy requirements 5
and 6. The provisions of our Charter restricting the ownership and transfer of
the common stock are described in "Description of Our Capital Stock--Redemption
and Restrictions on Transfer."
United Dominion currently has several direct corporate subsidiaries and
may have additional corporate subsidiaries in the future. A corporation that is
a "qualified REIT subsidiary" is not treated for federal income tax purposes as
a corporation separate from its parent REIT. All assets, liabilities, and items
of income, deduction and credit of a "qualified REIT subsidiary" are treated as
assets, liabilities, and items of income, deduction, and credit of the REIT. A
"qualified REIT subsidiary" is a corporation, all of the capital stock of which
is owned by the REIT. Thus, in applying the requirements described herein, any
"qualified REIT subsidiary" of United Dominion will be ignored, and all assets,
liabilities, and items of income, deduction, and credit of the subsidiary will
be treated as assets, liabilities and items of income, deduction and credit of
United Dominion. United Dominion's corporate subsidiaries are qualified REIT
subsidiaries. Accordingly, they are not subject to federal corporate income
taxation, though they may be subject to state and local taxation.
In the case of a REIT that is a partner in a partnership, the REIT is
treated as owning its proportionate share of the assets of the partnership and
as earning its allocable share of the gross income of the partnership for
purposes of the applicable REIT qualification tests. Thus, United Dominion's
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proportionate share of the assets, liabilities and items of income of the
partnerships in which we own an interest, directly or indirectly, are treated as
assets and gross income of United Dominion for purposes of applying the various
REIT qualification requirements.
Income Tests
United Dominion must satisfy two gross income tests annually to
maintain our qualification as a REIT. First, at least 75% of our gross income,
excluding gross income from prohibited transactions, for each taxable year must
consist of defined types of income that we derive, directly or indirectly, from
investments relating to real property or mortgages on real property or temporary
investment income (the "75% gross income test"). Qualifying income for purposes
of the 75% gross income test generally includes:
o rents from real property;
o interest on debt secured by mortgages on real property or on
interests in real property; and
o dividends or other distributions on and gain from the sale of
shares in other REITs.
Second, at least 95% of our gross income, excluding gross income from
prohibited transactions, for each taxable year generally must consist of income
that is qualifying income for purposes of the 75% gross income test, dividends,
other types of interest, gain from the sale or disposition of stock or
securities, or any combination of the foregoing (the "95% gross income test").
Gross income from United Dominion's sale of property that we hold primarily for
sale to customers in the ordinary course of business is excluded from both
income tests. The following paragraphs discuss the specific application of these
tests to United Dominion.
Rents and Interest. Rent that United Dominion receives from real
property that we own and lease to tenants will qualify as "rents from real
property" only if the following conditions are met.
o First, the rent must not be based, in whole or in part, on the
income or profits of any person. However, "rents from real
property" generally does not exclude an amount solely because
it is based on a fixed percentage or percentages of receipts
or sales.
o Second, neither United Dominion nor a direct or indirect owner
of 10% or more of our stock may own, actually or
constructively, 10% or more of a tenant from whom we receive
rent.
o Third, all of the rent received under a lease of real property
will not qualify as "rents from real property" unless the rent
attributable to the personal property leased in connection
with such lease is no more than 15% of the total rent received
under the lease.
o Finally, United Dominion generally must not operate or manage
our real property or furnish or render services to our
tenants, other than through an "independent contractor" who is
adequately compensated and from whom United Dominion does not
derive revenue. However, United Dominion need not provide
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services through an "independent contractor," but instead may
provide services directly, if the services are "usually or
customarily rendered" in connection with the rental of space
for occupancy only and are not otherwise considered "rendered
to the occupant." In addition, United Dominion may render a de
minimis amount of "non-customary" services to the tenants of a
property, other than through an independent contractor, as
long as its income from the services does not exceed 1% of our
income from the related property.
United Dominion does not receive any rent that is based on the income
or profits of any person. In addition, we do not own, directly or indirectly,
10% or more of any tenant. Furthermore, United Dominion believes that any
personal property rented in connection with our apartment facilities is well
within the 15% restriction. Finally, United Dominion does not provide services,
other than within the 1% de minimis exception described above, to our tenants
that are not customarily furnished or rendered in connection with the rental of
the apartment units, other than through an independent contractor.
United Dominion's investment in apartment communities in major part
gives rise to rental income that is qualifying income for purposes of the 75%
and 95% gross income tests. Gains on sales of apartment communities, other than
from prohibited transactions, as described below, or of United Dominion's
interest in a partnership generally will be qualifying income for purposes of
the 75% and 95% gross income tests. We anticipate that income on our other
investments will not result in our failing the 75% or 95% gross income test for
any year.
Prohibited Transaction Rules. A REIT will incur a 100% tax on the net
income derived from a sale or other disposition of property, other than
foreclosure property, that the REIT holds primarily for sale to customers in the
ordinary course of a trade or business. United Dominion believes that none of
our assets is held for sale to customers and that a sale of any such asset would
not be in the ordinary course of our business. Whether a REIT holds an asset
"primarily for sale to customers in the ordinary course of a trade or business"
depends, however, on the facts and circumstances in effect from time to time,
including those related to a particular asset. Nevertheless, United Dominion
will attempt to comply with the terms of safe-harbor provisions in the federal
income tax laws prescribing when an asset sale will not be characterized as a
prohibited transaction. We cannot assure you, however, that United Dominion can
comply with such safe-harbor provisions or that we will avoid owning property
that may be characterized as property that we hold "primarily for sale to
customers in the ordinary course of a trade or business."
Hedging Transactions. From time to time, United Dominion may enter into
hedging transactions with respect to one or more of our assets or liabilities.
Our hedging activities may include entering into interest rate swaps, caps and
floors, or options to purchase such items, and futures and forward contracts. To
the extent that United Dominion enters into an interest rate swap or cap
contract, option, futures contract, forward rate agreement or any similar
financial instrument to hedge our indebtedness incurred to acquire or carry
"real estate assets," any periodic income or gain from the disposition of such
contract should be qualifying income for purposes of the 95% gross income test,
but not the 75% gross income test. To the extent that United Dominion hedges
with other types of financial instruments, or in other situations, it is not
entirely clear how the income from those transactions will be treated for
purposes of the gross income tests. United Dominion intends to structure any
hedging transactions in a manner that does not jeopardize our status as a REIT.
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Failure to Qualify. If United Dominion fails to satisfy one or both of
the 75% or 95% gross income tests for any taxable year, we may nevertheless
qualify as a REIT for that year if we are eligible for relief under certain
provisions of the federal income tax laws. Those relief provisions generally
will be available if:
o United Dominion's failure to meet the gross income tests was
due to reasonable cause and not due to willful neglect;
o United Dominion attaches a schedule of the sources of our
income to our federal income tax return; and
o any incorrect information on the schedule is not due to fraud
with intent to evade tax.
It is not possible, however, to state whether, in all circumstances, we
would be entitled to the benefit of those relief provisions. For example, if we
fail to satisfy the gross income tests because nonqualifying income that we
intentionally receive or accrue exceeds the gross income test limits on such
income, the Internal Revenue Service could conclude that our failure to satisfy
the tests was not due to reasonable cause. As discussed above in "--Taxation of
United Dominion," even if the relief provisions apply, United Dominion would
incur a 100% tax on the gross income attributable to the greater of the amounts
by which we fail the 75% and 95% gross income tests, multiplied by a fraction
intended to reflect our profitability.
Asset Tests
To maintain our qualification as a REIT, United Dominion also must
satisfy three tests relating to the nature and diversification of our assets at
the close of each quarter of each taxable year:
o First, at least 75% of the value of our total assets must
consist of cash or cash items, including receivables,
government securities, "real estate assets," or qualifying
temporary investments (the "75% asset test");
o Second, no more than 25% of our total assets may be
represented by securities other than those that are qualifying
assets for purposes of the 75% asset test; and
o Third, of the investments included in the 25% asset class, the
value of any one issuer's securities that United Dominion owns
may not exceed 5% of the value of our total assets, and we may
not own more than 10% of any one issuer's outstanding voting
securities.
For purposes of those tests, "securities" does not include our interest
in partnerships or any qualified REIT subsidiary. For purposes of the asset
tests, we are deemed to own our proportionate share of the assets of any
partnership in which we own an interest, rather than our interest in that
partnership. United Dominion has operated and intends to continue to operate so
that we have not acquired or disposed, and in the future will not acquire or
dispose, of assets in a way that would cause us to violate either asset test. If
United Dominion should fail to satisfy the asset tests at the end of a calendar
quarter, we would not lose our REIT status if (A) we satisfied the asset tests
at the close of the preceding calendar quarter and (B) the discrepancy between
the value of our assets and the asset test requirements arose from changes in
the market values of our assets and was not wholly or partly caused by the
acquisition of one or more non-qualifying assets. If United Dominion did not
satisfy the condition described in clause (B) of the preceding sentence, we
still could avoid disqualification as a REIT by eliminating any discrepancy
within 30 days after the close of the calendar quarter in which the discrepancy
arose.
42
<PAGE>
The U. S. House and Senate recently passed legislation (the "Tax Bill")
that allows United Dominion to own up to 100% of the stock of taxable REIT
subsidiaries ("TRSs"), which can perform activities unrelated to our tenants,
such as third-party management, development and other independent business
activities, as well as provide services to our tenants, without disqualifying
the rent we receive from our tenants. The Tax Bill also prevents us from owning
more than 10% of the voting power or value of the stock of a taxable subsidiary
that is not treated as a TRS. Prior to the Tax Bill, we were prohibited only
from owning more than 10% of the voting stock of a taxable subsidiary. Overall,
no more than 20% of our assets can consist of securities of TRSs under the Tax
Bill. President Clinton is expected to sign the Tax Bill into law, in which case
the TRS provisions will apply for taxable years beginning after December 31,
2000.
Distribution Requirements
Each taxable year, United Dominion must distribute, other than capital
gain dividends and deemed distributions of retained capital gain, to our
shareholders in an aggregate amount at least equal to:
o the sum of (A) 95% of its "REIT taxable income," computed
without regard to the dividends paid deduction and our net
capital gain or loss, and (B) 95% of our after-tax net income,
if any, from foreclosure property, minus
o the sum of certain items of noncash income.
United Dominion must pay such distributions in the taxable year to
which they relate, or in the following taxable year if we declare the
distribution before we timely file our federal income tax return for such year
and pay the distribution on or before the first regular dividend payment date
after such declaration.
Under the Tax Bill, the 95% distribution requirement discussed above
was reduced to 90%. If signed into law, that provision of the Tax Bill would
apply for taxable years beginning after December 31, 2000.
United Dominion will pay federal income tax on taxable income,
including net capital gain, that we do not distribute to our shareholders.
Furthermore, if we fail to distribute during a calendar year, or, in the case of
distributions with declaration and record dates falling in the last three months
of the calendar year, by the end of January following such calendar year, at
least the sum of:
o 85% of our REIT ordinary income for such year,
o 95% of our REIT capital gain income for such year, and
o any undistributed taxable income from prior periods,
we will incur a 4% nondeductible excise tax on the excess of such required
distribution over the amounts we actually distributed. United Dominion may elect
to retain and pay income tax on the net long-term capital gain that we receive
in a taxable year. If we so elect, we will be treated as having distributed any
such retained amount for purposes of the 4% excise tax described above. United
Dominion has made, and intends to continue to make, timely distributions
sufficient to satisfy the annual distribution requirements.
43
<PAGE>
It is possible that, from time to time, United Dominion may experience
timing differences between (A) the actual receipt of income and actual payment
of deductible expenses and (B) the inclusion of that income and deduction of
such expenses in arriving at our REIT taxable income. For example, United
Dominion may not deduct recognized capital losses from our "REIT taxable
income." Further, it is possible that, from time to time, United Dominion may be
allocated a share of net capital gain attributable to the sale of depreciated
property that exceeds our allocable share of cash attributable to that sale. As
a result of the foregoing, United Dominion may have less cash than is necessary
to distribute all of our taxable income and thereby avoid corporate income tax
and the excise tax imposed on undistributed income. In such a situation, we may
need to borrow funds or issue preferred or common stock.
Under specified circumstances, United Dominion may be able to correct a
failure to meet the distribution requirement for a year by paying "deficiency
dividends" to our shareholders in a later year. United Dominion may include such
deficiency dividends in our deduction for dividends paid for the earlier year.
Although United Dominion may be able to avoid income tax on amounts distributed
as deficiency dividends, we will be required to pay interest to the Internal
Revenue Service based upon the amount of any deduction we take for deficiency
dividends.
Recordkeeping Requirements
United Dominion must maintain records of specified information in order
to qualify as a REIT. In addition, to avoid a monetary penalty, United Dominion
must request on an annual basis certain information from our shareholders
designed to disclose the actual ownership of our outstanding stock. United
Dominion has complied, and intends to continue to comply, with such
requirements.
Failure to Qualify
If United Dominion failed to qualify as a REIT in any taxable year, and
no relief provision applied, we would be subject to federal income tax,
including any applicable alternative minimum tax, on our taxable income at
regular corporate rates. In calculating our taxable income in a year in which we
failed to qualify as a REIT, United Dominion would not be able to deduct amounts
paid out to our shareholders. In fact, United Dominion would not be required to
distribute any amounts to our shareholders in such year. In such event, to the
extent of our current and accumulated earnings and profits, all distributions to
our shareholders would be taxable as ordinary income. Subject to certain
limitations of the Internal Revenue Code, corporate shareholders might be
eligible for the dividends received deduction. Unless United Dominion qualified
for relief under specific statutory provisions, we also would be disqualified
from taxation as a REIT for the four taxable years following the year during
which we ceased to qualify as a REIT. United Dominion cannot predict whether in
all circumstances we would qualify for such statutory relief.
Other Tax Consequences
State and Local Taxes. United Dominion and/or you may be subject to
state and local tax in various states and localities, including those states and
localities in which United Dominion or you transact business, own property or
reside. The state and local tax treatment in such jurisdictions may differ from
the federal income tax treatment described above. Consequently, you should
consult your own tax advisor regarding the effect of state and local tax laws
upon an investment in our securities.
44
<PAGE>
PLAN OF DISTRIBUTION
United Dominion may sell these securities to or through underwriters or
to investors directly or through designated agents. Any underwriter or agent
involved in the offer and sale of these securities will be named in the
applicable prospectus supplement.
Underwriters may offer and sell these securities at a fixed price or
prices, which may be changed, or from time to time at market prices prevailing
at the time of sale, at prices related to the prevailing market prices or at
negotiated prices. We also may, from time to time, authorize underwriters acting
as agents to offer and sell these securities upon the terms and conditions set
forth in any prospectus supplement. In connection with the sale of these
securities, underwriters may be deemed to have received compensation from United
Dominion in the form of underwriting discounts or commissions and may also
receive commissions from purchasers of these securities for whom they may act as
agent. Underwriters may sell these securities to or through dealers. The dealers
may receive compensation in the form of discounts, concessions or commissions,
which may be changed from time to time, from the underwriters and/or from the
purchasers for whom they may act as agent.
Any underwriting compensation that we pay to underwriters or agents in
connection with the offering of these securities and any discounts, concessions
or commissions allowed by underwriters to participating dealers will be set
forth in the applicable prospectus supplement. Underwriters, dealers and agents
participating in the distribution of these securities may be deemed to be
underwriters, and any discounts and commissions received by them and any profit
realized by them on resale of these securities may be deemed to be underwriting
discounts and commissions under the Securities Act. Underwriters, dealers and
agents may be entitled, under agreements entered into with United Dominion, to
indemnification against and contribution toward certain civil liabilities,
including liabilities under the Securities Act.
If indicated in the applicable prospectus supplement, United Dominion
will authorize dealers acting as our agents to solicit offers by certain
institutions to purchase these securities from United Dominion at the public
offering price set forth in the prospectus supplement pursuant to delayed
delivery contracts providing for payment and delivery on the date or dates
stated in the prospectus supplement. Each delayed delivery contract will be for
an amount not less than, and the principal amount of the securities sold
pursuant to delayed delivery contracts will not be less nor more than, the
respective amounts stated in the prospectus supplement.
Institutions with which delayed delivery contracts, when authorized,
may be made include commercial and savings banks, insurance companies, pension
funds, investment companies, educational and charitable institutions and other
institutions, but will in all cases be subject to our approval. Delayed delivery
contracts will not be subject to any conditions except:
o an institution's purchase of the securities covered by its
delayed delivery contract will not at the time of delivery be
prohibited under the laws of any jurisdiction in the United
States to which the institution is subject; and
o United Dominion will have sold to the underwriters the total
principal amount of the securities less the principal amount
thereof covered by delayed delivery contracts.
A commission indicated in the prospectus supplement will be paid to
agents and underwriters soliciting purchases of these securities pursuant to
45
<PAGE>
delayed delivery contracts that we accepted. Agents and underwriters will have
no responsibility in respect of the delivery or performance of delayed delivery
contracts.
Certain of the underwriters and their affiliates may be customers of,
engage in transactions with and perform services for United Dominion in the
ordinary course of business.
LEGAL MATTERS
The validity of these securities will be passed upon for United
Dominion by Hunton & Williams, Richmond, Virginia. Brown & Wood LLP, New York,
New York, will act as counsel to any underwriters, dealers or agents.
EXPERTS
Ernst & Young LLP, independent auditors, have audited our consolidated
financial statements and schedule included in our Annual Report on Form 10-K for
the year ended December 31, 1998, as set forth in their report, which is
incorporated by reference in this prospectus and elsewhere in the registration
statement. We have incorporated by reference our financial statements and
schedule in reliance on Ernst & Young LLP's report, given on their authority as
experts in accounting and auditing.
The consolidated financial statements of American Apartment Communities
II, Inc. and American Apartment Communities II, L.P., for the year ended
December 31, 1997, included in our current report on Form 8-K filed with the SEC
on October 23, 1998, incorporated herein by reference, have been audited by
Arthur Andersen LLP, independent public accountants, as indicated in their
reports with respect thereto, and are included herein in reliance upon the
authority of Arthur Andersen LLP as experts in giving these reports.
46
<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
$700,000,000
[UNITED DOMINION LOGO]
Securities
PROSPECTUS
-----------------
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The estimated expenses in connection with the offering are as follows:
Securities and Exchange Commission registration fee............. $162,639
Accounting fees and expenses.................................... 150,000
Blue Sky fees and expenses...................................... 45,000
Legal fees and expenses......................................... 170,000
Trustees' fees and expenses..................................... 30,000
Rating agency fees.............................................. 100,000
Printing ....................................................... 75,000
Miscellaneous................................................... 50,000
------
TOTAL.................................................. $782,639
Item 15. Indemnification of Officers and Directors
Directors and officers of United Dominion may be indemnified against
liabilities, fines, penalties, and claims imposed upon or asserted against them
as provided in the Virginia Stock Corporation Act and the Restated Articles of
Incorporation. Such indemnification covers all costs and expenses reasonably
incurred by a director or officer. The Board of Directors, by a majority vote of
a quorum of disinterested directors or, under certain circumstances, independent
counsel appointed by the Board of Directors, must determine that the director or
officer seeking indemnification was not guilty of willful misconduct or a
knowing violation of the criminal law. In addition, the Virginia Stock
Corporation Act and United Dominion's Restated Articles of Incorporation may
under certain circumstances eliminate the liability of directors and officers in
a shareholder or derivative proceeding.
If the person involved is not a director or officer of United Dominion,
the Board of Directors may cause United Dominion to indemnify to the same extent
allowed for directors and officers of United Dominion the person who was or is a
party to a proceeding, by reason of the fact that he is or was an employee or
agent of United Dominion, or is or was serving at the request of United Dominion
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust, employee benefit plan or other enterprise.
Item 16. Exhibits
1(a) Form of Underwriting Agreement for debt securities (filed as
Exhibit 1(a) to United Dominion's Form S-3 registration
statement filed with the SEC on May 15, 1997 (File No.
333-27221), and incorporated by reference herein)
1(b) Form of Underwriting Agreement for preferred stock and common
stock (filed as Exhibit 1(a) to United Dominion's Form S-3
registration statement filed with the SEC on May 15, 1997 (File
No. 333-27221), and incorporated by reference herein)
II-1
<PAGE>
4(a) Specimen common stock certificate (filed as Exhibit 4(i) to
United Dominion's annual report on Form 10-K for the year ended
December 31, 1993 (File No. 1-10524), and incorporated by
reference herein)
4(a)(i) First Amended and Restated Rights Agreement dated as of
September 14, 1999, between United Dominion and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (filed as Exhibit
A(i)(d)(A) to United Dominion's quarterly report on Form 10-Q
dated September 30, 1999 (File No. 1-10524) and incorporated by
reference herein)
4(a)(ii) Form of certificate for Series C Junior Participating Cumulative
Redeemable Preferred Stock (filed as Exhibit 2 to United
Dominion's Form 8-A registration statement dated February 4,
1998 (File No.
1-10524), and incorporated by reference herein)
4(b) Form of preferred stock certificate (filed as Exhibit 4(i)(b) to
United Dominion's Form S-3 registration statement filed with the
SEC on August 19, 1994 (File No. 33-55159), and incorporated by
reference herein)
4(c) Restated Articles of Incorporation of United Dominion dated
January 21, 1999 (filed as Exhibit 4(a)(ii) to United Dominion's
Form S-3 registration statement filed with the SEC on February
24, 1999 (File No. 333-72885), and incorporated by reference
herein)
4(d) Restated Bylaws of the United Dominion (filed as Exhibit 3(b) to
United Dominion's annual report on Form 10-K for the year ended
December 31, 1998 (File No. 1-10524), and incorporated by
reference herein)
4(e) Note Purchase Agreement dated as of January 15, 1993, between
United Dominion and CIGNA Property and Casualty Insurance
Company, Connecticut General Life Insurance Company, Connecticut
General Life Insurance Company, on behalf of one or more
separate accounts, Insurance Company of North America, Principal
Mutual Life Insurance Company and Aid Association for Lutherans
(filed as Exhibit 6(c)(5) to United Dominion's Form 8-A
Registration Statement dated April 19, 1990 (File No. 1-10524),
and incorporated by reference herein)
4(f) Senior Indenture dated as of November 1, 1995, between United
Dominion and First Union National Bank of Virginia, as Trustee
(filed as Exhibit 4(ii)(h)(l) to United Dominion's quarterly
report on Form 10-Q for the quarter ended June 30, 1996 (File
No. 1-10524), and incorporated by reference herein)
4(g) Form of Subordinated Indenture dated as of August 1, 1994,
between United Dominion and Crestar Bank, as trustee (filed as
Exhibit 4(i)(m) to United Dominion's Form S-3 registration
statement filed with the SEC on November 15, 1995 (File No.
33-64725), and incorporated by reference herein)
4(h) Form of Senior Security (filed as Exhibit 4(i)(n) to United
Dominion's Form S-3 registration statement filed with the SEC on
November 15, 1995 (File No. 33-64725), and incorporated by
reference herein)
II-2
<PAGE>
4(i) Form of Subordinated Security (filed as Exhibit 4(i)(p) to
United Dominion's Form S-3 registration statement filed with the
SEC on August 19, 1994 (File No. 33-55159), and incorporated by
reference herein)
5 Opinion of Hunton & Williams
8 Tax Opinion of Hunton & Williams
12 Statement regarding computation of ratios
23(a) Consent of Ernst & Young LLP
23(b) Consent of Arthur Andersen LLP
23(c) Consent of Hunton & Williams (included in Exhibits 5 and 8)
24 Power of Attorney (located on the signature page of this
Registration Statement)
25(a) Statement of Eligibility under the Trust Indenture Act of 1939
on Form T-1 of First Union National Bank of Virginia, as Trustee
under the Senior Indenture
25(b) Statement of Eligibility under the Trust Indenture Act of 1939
on Form T-1 of Crestar Bank, as Trustee under the Subordinated
Indenture
Item 17. Undertakings
The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made of the securities registered hereby, a post-effective
amendment to this registration statement (i) to include any prospectus
required by Section 10(a)(3) of the Securities Act of 1933; (ii) to
reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement; provided, however, any increase or
decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any
deviation from the low or high and of the estimated maximum offering
range may be reflected in the form of prospectus filed with the SEC
pursuant to Rule 424(b) if, in the aggregate, the changes in volume and
price represent no more than 20 percent change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee" table
in the effective registration statement; and (iii) to include any
material information with respect to the plan of distribution not
previously disclosed in the registration statement or any material
change to the information in the registration statement; provided,
however, that the undertakings set forth in subparagraphs (i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed with or furnished to the SEC by the registrant pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in this registration statement;
II-3
<PAGE>
(2) That, for the purpose of determining any liability under
the Securities Act of 1933, each the post-effective amendment will be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of the securities at that time will
be deemed to be the initial bona fide offering thereof;
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is incorporated by reference in this registration statement will be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of the securities at that time will be deemed to be
the initial bona fide offering thereof; and
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described under Item 15 above or
otherwise, the registrant has been advised that the in the opinion of the
Securities and Exchange SEC the indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable. In the event that a claim
for indemnification against the liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted against the registrant by the director, officer or
controlling person in connection with the securities being registered, the
registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether the indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of the
issue.
The undersigned registrant hereby undertakes that:
(1) For purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of
prospectus filed as part of this registration statement in reliance
upon Rule 430A and contained in the form of prospectus filed by the
registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act will be deemed to be part of this registration statement
as of the time it was declared effective.
(2) For the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a
form of prospectus will be deemed to be a new registration statement
relating to the securities offered therein, and the offering of the
securities at that time will be deemed to be the initial bona fide
offering thereof.
The undersigned registrant hereby undertakes to file an application for
purposes of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of United Dominion Indenture Act in accordance with the rules
and regulations prescribed by the SEC under Section 305(b)(2) of the Act.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Richmond, Commonwealth of Virginia on the 10th day of
December, 1999.
UNITED DOMINION REALTY TRUST, INC.
By: /s/ John P. McCann
--------------------------------------
John P. McCann
Chairman and Chief Executive Officer
POWER OF ATTORNEY
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities indicated on December 10, 1999. Each of the undersigned officers and
directors of the registrant hereby constitutes John P. McCann and Katheryn E.
Surface, either of whom may act, his or her true and lawful attorneys-in-fact
with full power to sign for him or her and in his or her name in the capacities
indicated below and to file any and all amendments to the registration statement
filed herewith, making the changes in the registration statement as the
registrant deems appropriate, and generally to do all the things in his or her
name and behalf in his or her capacity as an officer and director to enable the
registrant to comply with the provisions of the Securities Act of 1933 and all
requirements of the Securities and Exchange Commission.
<TABLE>
<CAPTION>
Signature Title & Capacity
- --------- ----------------
<S> <C>
Chairman, Chief Executive Officer (Principal Executive Officer)
/s/ John P. McCann and Director
- -----------------------------------------
John P. McCann
/s/ John S. Schneider President, Chief Operating Officer and Director
- -----------------------------------------
John S. Schneider
Executive Vice President and Chief Financial Officer (Principal
/s/ A. William Hamill Financial Officer)
- -----------------------------------------
A. William Hamill
/s/ Robin R. Flanagan Vice President and Controller (Principal Accounting Officer)
- -----------------------------------------
Robin R. Flanagan
</TABLE>
II-5
<PAGE>
/s/ Jeff C. Bane Director
- -----------------------------------------
Jeff C. Bane
/s/ R. Toms Dalton, Jr. Director
- -----------------------------------------
R. Toms Dalton, Jr.
/s/ Robert P. Freeman Director
- -----------------------------------------
Robert P. Freeman
Director
- -----------------------------------------
Jon A. Grove
/s/ Barry M. Kornblau Director
- -----------------------------------------
Barry M. Kornblau
/s/ James D. Klingbeil Director
- -----------------------------------------
James D. Klingbeil
/s/ Lynne B. Sagalyn Director
- -----------------------------------------
Lynne B. Sagalyn
/s/ Mark J. Sandler Director
- -----------------------------------------
Mark J. Sandler
/s/ Robert W. Scharar Director
- -----------------------------------------
Robert W. Scharar
II-6
<PAGE>
EXHIBIT INDEX
1(a) Form of Underwriting Agreement for debt securities (filed as
Exhibit 1(a) to United Dominion's Form S-3 registration
statement filed with the SEC on May 15, 1997 (File No.
333-27221), and incorporated by reference herein)
1(b) Form of Underwriting Agreement for preferred stock and common
stock (filed as Exhibit 1(a) to United Dominion's Form S-3
registration statement filed with the SEC on May 15, 1997 (File
No. 333-27221), and incorporated by reference herein)
4(a) Specimen common stock certificate (filed as Exhibit 4(i) to
United Dominion's annual report on Form 10-K for the year ended
December 31, 1993 (File No. 1-10524), and incorporated by
reference herein)
4(a)(i) First Amended and Restated Rights Agreement dated as of
September 14, 1999, between United Dominion and ChaseMellon
Shareholder Services, L.L.C., as Rights Agent (filed as Exhibit
A(i)(d)(A) to United Dominion's quarterly report on Form 10-Q
dated September 30, 1999 (File No. 1-10524) and incorporated by
reference herein)
4(a)(ii) Form of certificate for Series C Junior Participating Cumulative
Redeemable Preferred Stock (filed as Exhibit 2 to United
Dominion's Form 8-A registration statement dated February 4,
1998 (File No.
1-10524), and incorporated by reference herein)
4(b) Form of preferred stock certificate (filed as Exhibit 4(i)(b) to
United Dominion's Form S-3 registration statement filed with the
SEC on August 19, 1994 (File No. 33-55159), and incorporated by
reference herein)
4(c) Restated Articles of Incorporation of United Dominion dated
January 21, 1999 (filed as Exhibit 4(a)(ii) to United Dominion's
Form S-3 registration statement filed with the SEC on February
24, 1999 (File No. 333-72885), and incorporated by reference
herein)
4(d) Restated Bylaws of the United Dominion (filed as Exhibit 3(b) to
United Dominion's annual report on Form 10-K for the year ended
December 31, 1998 (File No. 1-10524), and incorporated by
reference herein)
4(e) Note Purchase Agreement dated as of January 15, 1993, between
United Dominion and CIGNA Property and Casualty Insurance
Company, Connecticut General Life Insurance Company, Connecticut
General Life Insurance Company, on behalf of one or more
separate accounts, Insurance Company of North America, Principal
Mutual Life Insurance Company and Aid Association for Lutherans
(filed as Exhibit 6(c)(5) to United Dominion's Form 8-A
Registration Statement dated April 19, 1990 (File No. 1-10524),
and incorporated by reference herein)
4(f) Senior Indenture dated as of November 1, 1995, between United
Dominion and First Union National Bank of Virginia, as Trustee
(filed as Exhibit 4(ii)(h)(l) to United Dominion's quarterly
report on Form 10-Q for the quarter ended June 30, 1996 (File
No. 1-10524), and incorporated by reference herein)
<PAGE>
4(g) Form of Subordinated Indenture dated as of August 1, 1994,
between United Dominion and Crestar Bank, as trustee (filed as
Exhibit 4(i)(m) to United Dominion's Form S-3 registration
statement filed with the SEC on November 15, 1995 (File No.
33-64725), and incorporated by reference herein)
4(h) Form of Senior Security (filed as Exhibit 4(i)(n) to United
Dominion's Form S-3 registration statement filed with the SEC on
November 15, 1995 (File No. 33-64725), and incorporated by
reference herein)
4(i) Form of Subordinated Security (filed as Exhibit 4(i)(p) to
United Dominion's Form S-3 registration statement filed with the
SEC on August 19, 1994 (File No. 33-55159), and incorporated by
reference herein)
5 Opinion of Hunton & Williams
8 Tax Opinion of Hunton & Williams
12 Statement regarding computation of ratios
23(a) Consent of Ernst & Young LLP
23(b) Consent of Arthur Andersen LLP
23(c) Consent of Hunton & Williams (included in Exhibits 5 and 8)
24 Power of Attorney (located on the signature page of this
Registration Statement)
25(a) Statement of Eligibility under the Trust Indenture Act of 1939
on Form T-1 of First Union National Bank of Virginia, as Trustee
under the Senior Indenture
25(b) Statement of Eligibility under the Trust Indenture Act of 1939
on Form T-1 of Crestar Bank, as Trustee under the Subordinated
Indenture
Exhibit 5
[Letterhead of Hunton & Williams]
FILE NO.: 27789.271
December 13, 1999
United Dominion Realty Trusts, Inc.
10 South Sixth Street
Richmond, Virginia 23219-3802
Registration Statement on Form S-3
Relating to $616,058,554 Issue Amount
of Unallocated Securities
-------------------------
Ladies and Gentlemen:
We have acted as counsel to United Dominion Realty Trusts, Inc., a
Virginia corporation (the "Company"), in connection with the registration by the
Company of an aggregate of $616,058,554 of its (i) unsecured debt securities
("Debt Securities"), (ii) shares of preferred stock, no par value ("Preferred
Stock"), (iii) shares of common stock, par value $1.00 per share ("Common
Stock"), and (iv) the rights attached to the Common Stock to purchase shares of
the Series C Preferred Stock (the "Rights," together with the Debt Securities,
Preferred Stock and Common Stock, the "Securities"), as set forth in the
Registration Statement on Form S-3 (the "Registration Statement") that is being
filed on the date hereof with the Securities and Exchange Commission (the
"Commission") by the Company pursuant to the Securities Act of 1933, as amended.
The Securities are to be issued in one or more series and are to be sold from
time to time as set forth in the Registration Statement, the Prospectus
contained therein (the "Prospectus") and any amendments or supplements thereto.
In rendering this opinion, we have relied upon, among other things, our
examination of such records of the Company and certificates of its officers and
of public officials as we have deemed necessary.
Based upon the foregoing and the further qualifications stated below,
we are of the opinion that:
1. The Company is duly incorporated, validly existing and in good
standing under the laws of the Commonwealth of Virginia; and
2. When (a) the terms of any class or series of the Securities have
been authorized by appropriate corporate action of the Company and (b) the
Securities have been issued and sold upon the terms and conditions set forth in
the Registration Statement, the Prospectus and the applicable supplement to the
Prospectus, and with respect to the Debt Securities, such Debt Securities have
been duly executed, authenticated and delivered in accordance with the
applicable indenture, then (x) the Debt Securities will be validly authorized
and issued and binding obligations of the Company and (y) the Preferred Stock,
the Common Stock and the Rights will be legally issued, fully paid and
nonassessable.
We hereby consent to the filing of this opinion with the Commission as
an exhibit to the Registration Statement and to the statement made in reference
to this firm under the caption "Legal Matters" in the Registration Statement.
Very truly yours,
/s/ Hunton & Williams
00337/08128
Exhibit 8
[Letterhead of Hunton & Williams]
December 13, 1999
United Dominion Realty Trust, Inc.
10 South 6th Street
Richmond, Virginia 23219
United Dominion Realty Trust, Inc.
Qualification as
Real Estate Investment Trust
----------------------------
Ladies and Gentlemen:
We have acted as counsel to United Dominion Realty Trust, Inc., a
Virginia corporation (the "Company"), in connection with the preparation of a
Form S-3 registration statement filed with the Securities and Exchange
Commission ("SEC") on December 13, 1999 (the "Registration Statement") with
respect to the offer and sale of up to $700 million of the debt securities,
preferred stock, and common stock (together, the "Securities") of the Company.
You have requested our opinion on certain United States ("U.S.") federal income
tax matters in connection with the Offering. The Company is an equity real
estate investment trust ("REIT") that owns and operates apartments.
In connection with the opinion rendered below, we have examined and
relied on the accuracy of the following:
1. the Restated Articles of Incorporation of the Company;
2. the Amended and Restated Bylaws of the Company;
3. the minutes of meetings of the Company's board of directors held during
calendar years 1994, 1995, 1996, 1997, 1998, and 1999;
4. the letter ruling from the U.S. Internal Revenue Service (the
"Service") to the Company dated December 21, 1989, regarding the
characterization of certain amounts received by the Company from its rental
properties (the "1989 Letter Ruling");
5. the Company's audited financial statements for the years ended December
31, 1994, 1995, 1996, 1997, and 1998;
6. the Company's U.S. federal income tax returns for taxable years 1994,
1995, 1996, 1997, and 1998;
7. the Third Amended and Restated Agreement of Limited Partnership of the
Operating Partnership, dated as of December 4, 1998 (the "Operating Partnership
Agreement"), among the Company, as general partner, and several limited
partners;
<PAGE>
8. the partnership agreements and operating agreements (together with the
Operating Partnership Agreement, the "Partnership Agreements") of any subsidiary
partnerships or limited liability companies of the Company (the "Subsidiary
Partnerships");
9. the prospectus for the Company's Dividend Reinvestment and Stock
Purchase Plan dated January 16, 1998; and
10. the prospectus contained as part of the Registration Statement (the
"Prospectus").
In connection with the opinion rendered below, we have assumed
generally that:
1. Each of the documents referred to above has been duly authorized,
executed, and delivered; is authentic, if an original, or is accurate, if a
copy; and has not been amended;
2. The Company qualified as a REIT for its 1993 taxable year and all prior
taxable years;
3. During its 1999 taxable year and future taxable years, the Company has
operated and will continue to operate in such a manner that makes and will
continue to make the representations contained in a certificate, dated December
13, 1999 and executed by a duly appointed officer of the Company (the "Officer's
Certificate"), true for such years;
4. The Company will not make any amendments to its organizational
documents or to the Partnership Agreements after the date of this opinion letter
that would affect its qualification as a REIT for any taxable year;
5. Each partner of the Operating Partnership and the Subsidiary
Partnerships (each, a "Partner") that is a corporation or other entity has a
valid legal existence;
6. Each Partner has full power, authority, and legal right to enter into
and to perform the terms of the applicable Partnership Agreement and the
transactions contemplated thereby;
7. The 1989 Letter Ruling has not been and will not be revoked or modified
by the Service;
8. There are no agreements or understandings among the parties that would
define, supplement, or qualify the documents referred to above; and
9. No action will be taken by the Company or the Operating Partnership
after the date hereof that would have the effect of altering the facts upon
which the opinion set forth below is based.
In connection with the opinion rendered below, we also have relied upon
the correctness of the representations contained in the Officer's Certificate.
No facts have come to our attention that would cause us to question the accuracy
or completeness of the facts contained in the documents set forth above or the
representations set forth in the Officer's Certificate in a material way.
Based solely on the documents and the assumptions set forth above, the
representations set forth in the Officer's Certificate, and without further
investigation, we are of the opinion that:
(a) the Company qualified to be taxed as a REIT pursuant to sections
856 through 860 of the U.S. Internal Revenue Code of 1986, as amended (the
"Code"), for its taxable years ended December 31, 1994 through December 31,
1998, and the Company's organization and current and contemplated method of
<PAGE>
operation are such as to enable it to continue so to qualify for its taxable
year ending December 31, 1999, and in the future; and
(b) the descriptions of the law and the legal conclusions
contained in the Prospectus under the caption "Federal Income Tax Consequences
of United Dominion's Status as a REIT" are correct in all material respects, and
the discussion thereunder fairly summarizes the federal income tax
considerations that are likely to be material to a holder of the Securities.
Except as described herein, we have performed no further due diligence
and have made no efforts to verify the accuracy and genuineness of the documents
and assumptions set forth above, or the representations set forth in the
Officer's Certificate. We will not review the Company's compliance with such
documents, assumptions, and representations on a continuing basis. Accordingly,
no assurance can be given that the actual results of the Company's operations
for its 1999 and subsequent taxable years will satisfy the requirements for
qualification and taxation as a REIT.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. We also consent to the references to Hunton & Williams
under the caption "Legal Matters" in the Prospectus. In giving this consent, we
do not admit that we are in the category of persons whose consent is required by
Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations promulgated thereunder by the SEC.
The foregoing opinion is based on current provisions of the Code and
the Treasury regulations thereunder, published administrative interpretations
thereof, and published court decisions. The Service has not issued Treasury
regulations or administrative interpretations with respect to various provisions
of the Code relating to REIT qualification. No assurance can be given that the
law will not change in a way that will prevent the Company from qualifying as a
REIT.
The foregoing opinion is limited to the U.S. federal income tax matters
addressed herein, and no other opinions are rendered with respect to other U.S.
federal tax matters or to any issues arising under the tax laws of any other
country or any state or locality. We undertake no obligation to update the
opinion expressed herein after the date of this letter. This opinion letter is
solely for the information and use of the addressee, and it may not be
distributed, relied upon for any purpose by any other person, quoted in whole or
in part or otherwise reproduced in any document, or filed with any governmental
agency without our express written consent.
Very truly yours,
/s/ Hunton & Williams
07796/08074
<TABLE>
Exhibit 12
Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends
(Dollars in thousands)
<CAPTION>
Three Months ended Nine Months ended
September 30, September 30,
------------------------- ------------------------
1999 1998 1999 1998
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Income before extraordinary item ........... $ 20,042 $ 13,807 $ 80,416 $ 66,071
Add:
Portion of rents representative
of the interest factor ................. 306 155 795 401
Interest on indebtedness ................. 39014 27224 116011 75784
======== ======== ======== ========
Earnings ............................... $ 59,362 $ 41,186 $197,222 $142,256
======== ======== ======== ========
Fixed charges and preferred stock dividend:
Interest on indebtedness ................. $ 39,014 $ 27,224 $116,011 $ 75,784
Capitalized interest ..................... 1074 910 4259 2223
Portion of rents representative
of the interest factor ................. 306 155 795 401
-------- -------- -------- --------
Fixed charges ......................... 40394 28289 121065 78408
-------- -------- -------- --------
Add:
Preferred stock dividend ................. 9441 5650 28320 16953
-------- -------- -------- --------
Combined fixed charges and preferred stock $ 49,835 $ 33,939 $149,385 $ 95,361
dividend
======== ======== ======== ========
Ratio of earnings to fixed charges ......... 1.47 x 1.46 x 1.63 x 1.81 x
Ratio of earnings to combined fixed charges
and preferred stock dividend .......... 1.19 1.21 1.32 1.49
</TABLE>
Exhibit 23(a)
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-3, No. 333-00000) and related Prospectus of
United Dominion Realty Trust, Inc. for the registration of $700,000,000 of Debt
Securities, Preferred Stock or Common Stock and to the incorporation by
reference therein of our report dated January 27, 1999, with respect to the
consolidated financial statements and schedule of United Dominion Realty Trust,
Inc. included in its Annual Report (Form 10-K) for the year ended December 31,
1998, filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Richmond, Virginia
December 8, 1999
Exhibit 23(b)
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our report on American Apartment
Communities II, Inc., dated February 27, 1998, and our report on American
Apartment Communities II, L.P., dated February 12, 1998, included in the
Company's Current Report on Form 8-K, filed with the SEC on October 23, 1998,
and to all references to our Firm included in this registration statement.
/s/ ARTHUR ANDERSON LLP
San Francisco, California
December 8, 1999
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
FORM T-1
------------------------
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939, AS AMENDED,
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
Check if an application to determine eligibility of a trustee pursuant to
Section 305(b) (2)_____
------------------------
FIRST UNION NATIONAL BANK
(Exact name of Trustee as specified in its charter)
230 SOUTH TRYON STREET, 9TH FL.
CHARLOTTE, NC 28288-1179 22-1147033
(Address of principal executive office) (Zip Code) (I.R.S. Employer
Identification No.)
Sarah A. McMahon (804) 343-6057
800 East Main Street, Richmond, Virginia 23219
------------------------
United Dominion Realty Trust, Inc.
(Exact name of obligor as specified in its charter
Virginia 54-0857512
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10 South Sixth Street
Richmond, VA 23219-4074
(Address of principal executive offices) (Zip Code)
------------------------
Debt Securities
(Title of the indenture securities)
<PAGE>
1. General information.
(a) The following are the names and addresses of each examining or
supervising authority to which the Trustee is subject:
The Comptroller of the Currency, Washington, D.C.
Federal Reserve Bank of Richmond, Richmond, Virginia.
Federal Deposit Insurance Corporation, Washington, D.C.
Securities and Exchange Commission, Division of Market
Regulation, Washington, D.C.
(b) The Trustee is authorized to exercise corporate trust powers.
2. Affiliations with obligor.
The obligor is not an affiliate of the Trustee.
3. Voting Securities of the Trustee.
Response not required.
(See answer to Item 13)
4. Trusteeships under other indentures.
Response not required.
(See answer to Item 13)
5. Interlocking directorates and similar relationships with the obligor or
underwriters.
Response not required.
(See answer to Item 13)
6. Voting securities of the Trustee owned by the obligor or its officials.
Response not required.
(See answer to Item 13)
7. Voting securities of the Trustee owned by underwriters or their
officials.
Response not required.
(See answer to Item 13)
8. Securities of the obligor owned or held by the Trustee.
Response not required.
(See answer to Item 13)
2
<PAGE>
9. Securities of underwriters owned or held by the Trustee.
Response not required.
(See answer to Item 13)
10. Ownership or holdings by the Trustee of voting securities of certain
affiliates or security holders of the obligor.
Response not required.
(See answer to Item 13)
11. Ownership or holdings by the Trustee of any securities of a person
owning 50 percent or more of the voting securities of the obligor.
Response not required.
(See answer to Item 13)
12. Indebtedness of the obligor to the Trustee.
Response not required.
(See answer to Item 13)
13. Defaults by the obligor.
A. None
B. None
14. Affiliations with the underwriters.
Response not required.
(See answer to Item 13)
15. Foreign trustee.
Trustee is a national banking association organized under the
laws of the United States.
16. List of Exhibits.
(1) *Articles of Incorporation.
(2) Certificate of Authority of the Trustee to conduct business. No
Certificate of Authority of the Trustee to commence business is
furnished since this authority is continued in the Articles of
Association of the Trustee.
3
<PAGE>
(3) *Certificate of Authority of the Trustee to exercise corporate
trust powers.
(4) *By-Laws.
(5) Inapplicable.
(6) Consent by the Trustee required by Section 321(b) of the Trust
Indenture Act of 1939 as amended. Included at Page 5 of this Form
T-1 Statement.
(7) *Report of condition of Trustee. See Attached.
(8) Inapplicable.
(9) Inapplicable.
* Exhibits thus designated have heretofore been filed with the Securities and
Exchange Commission, have not been amended since filing are incorporated herein
by reference (See Exhibit T-1 Registration Number 333- 76965).
4
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the Trustee, FIRST UNION NATIONAL BANK, a national banking association
organized and existing under the laws of the United States of America, has duly
caused this Statement of Eligibility and Qualification to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Richmond, and in the Commonwealth of Virginia on the 9th day of December, 1999.
FIRST UNION NATIONAL BANK
(Trustee)
BY: /s/ Patricia A. Welling
----------------------------------------
Patricia A. Welling, Vice President
EXHIBIT T-1 (6)
CONSENT OF TRUSTEE
Under Section 321(b) of the Trust Indenture Act of 1939 and in
connection with the issuance by United Dominion Realty Trust, Inc. Debt
Securities, First Union National Bank, as the Trustee herein named, hereby
consents that reports of examinations of said Trustee by Federal, State,
Territorial or District authorities may be furnished by such authorities to the
Securities and Exchange Commission upon requests therefor.
FIRST UNION NATIONAL BANK
BY: /s/ Patricia A. Welling
----------------------------------------
Patricia A. Welling, Vice President
Dated: December 9, 1999
5
<PAGE>
R E P O R T OF C O N D I T I O N
Consolidating domestic subsidiaries of the
First Union National Bank Charlotte
Name of Bank City
in the state of North Carolina, at the close of business on September
30, 1999, published in response to call made by Comptroller of the
Currency, under title 12, United States Code, Section 161. Charter
Number 02737 Comptroller of the Currency Southeastern District
Statement of Resources and Liabilities
<TABLE>
<CAPTION>
ASSETS
Thousands of dollars
<S> <C>
1 Cash and balances due from depository institutions:
a. Noninterest-bearing balances and currency and coin............................................. 8,946,000
b. Interest-bearing balances...................................................................... 266,000
2 Securities:
a. Held-to-maturity securities...................................................................... 1,644,000
b. Available-for-sale securities.................................................................... 47,356,000
3 Federal funds sold and securities purchased under agmts to resell: 2,856,000
4 Loans and lease financing receivables:
a. Loans and leases, net of unearned income................................. 132,839,000
b. LESS: Allowance for loan and lease losses................................ 1,743,000
c. LESS: Allocated transfer risk reserve.................................... 0
d. Loans and leases, net of unearned income, allowance, and reserve................................. 131,096,000
5 Assets held in trading accounts..................................................................... 8,333,000
6 Premises and fixed assets (including capitalized leases)............................................ 3,070,000
7 Other real estate owned............................................................................. 134,000
8 Investments in unconsolidated subsidiaries and associated companies................................. 262,000
9 Customers' liability to this bank on acceptances outstanding........................................ 807,000
10 Intangible assets................................................................................... 5,115,000
11 Other assets........................................................................................ 10,789,000
12 Total assets........................................................................................ 220,674,000
1
<PAGE>
LIABILITIES
13 Deposits:
a. In domestic offices............................................................................. 129,621,000
(1) Noninterest-bearing.................................................. 21,341,000
(2) Interest-bearing.................................................... 108,280,000
b. In foreign offices, Edge and Agmt subsidiaries, and IBFs......................................... 9,838,000
(1) Noninterest-bearing.......................................................................... 466,000
(2) Interest-bearing............................................................................. 9,372,000
14 Federal funds purchased and securities sold under agmts to repurchase: 23,796,000
15 a. Demand notes issued to the U.S. Treasury......................................................... 782,000
b.Trading liabilities............................................................................... 4,984,000
16 Other borrowed money:
a. With a remaining maturity of one year or less.................................................... 14,643,000
b. With a remaining maturity of more than one year through three years............................. 5,639,000
c. With a remaining maturity of more than three years 2,872,000
17 Not applicable
18 Bank's liability on acceptances executed and outstanding............................................ 807,000
19 Subordinated notes and debentures................................................................... 4,269,000
20 Other liabilities................................................................................... 6,515,000
21 Total liabilities................................................................................... 203,766,000
22 Not applicable
EQUITY CAPITAL
23 Perpetual preferred stock and related surplus....................................................... 161,000
24 Common stock........................................................................................ 455,000
25 Surplus............................................................................................. 13,306,000
26 a. Undivided profits and capital reserves........................................................... 3,553,000
b. Net unrealized holding gains (losses) on available-for-sale securities........................... (562,000)
27 Cumulative foreign currency translation adjustments................................................. (5,000)
28 Total equity capital................................................................................ 16,908,000
29 Total liabilities, limited-life preferred stock, and equity capital
(sum of items 21and 28)............................................................................ 220,674,000
</TABLE>
2
<PAGE>
We, the undersigned directors, attest to the correctness of this
statement of resources and liabilities. We declare that it has been
examined by us, and to the best of our knowledge and belief has been
prepared in conformance with the instructions and is true and correct.
Directors I, Gary R. Sessions
Edward E. Crutchfield Name
G. Kennedy Thompson Vice President
Mark C. Treanor Title
of the above-named bank
do hereby declare that
this Report ofCondition
is true and correct to
the best of my
knowledge and belief.
3
Exhibit 25(b) Statement of Eligibility-Crestar Bank
- -------------------------------------------------------------------------------
Securities and Exchange Commission
Washington, DC 20549
--------------
Form T-1
--------------
Statement of Eligibility Under the Trust Indenture Act of 1939 of A
Corporation Designated to Act As Trustee
Check if an application to determine eligibility of a trustee pursuant to
Section 305(b)(2)_____
Crestar Bank
(Exact name of trustee as specified in its charter)
<TABLE>
<S> <C>
Virginia 53-0116200
(State of Incorporation, if not a national bank) (I.R.S. employer identification no.)
</TABLE>
919 East Main Street
Richmond, VA 23219
(Address of principal executive office) (Zip Code)
Linda F. Rigsby
919 E. Main Street, 18th Floor, Richmond, Virginia 23219
(804)782-7738
(Name, address and telephone number of agent for service)
United Dominion Realty Trust, Inc.
(Exact name of obligor as specified in its charter)
<TABLE>
<S> <C>
Virginia 54-0857512
(State or other jurisdiction of incorporation (I.R.S. employer identification no.)
or organization
</TABLE>
10 South 6th Street, Suite 203
Richmond, VA 23219-3802
(Address of principal executive offices) (Zip Code)
Subordinated Debt Securities
(Title of indenture securities)
- -----------------------------------------------------------------------------
<PAGE>
Item 1. General Information
Furnish the following information as to trustee:
(a) Name and Address of each examining or supervising authority to which it is
subject.
Bureau of Financial Institutions,
State Corporation Commission of Virginia
Richmond, Virginia
The Board of Governors of the Federal Reserve System,
Washington, DC
The Federal Reserve Bank,
Richmond, Virginia
Federal Deposit Insurance Corporation,
Washington, DC
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations with Obligor.
If the obligor is an affiliate of the trustee, describe such affiliation.
Obligor is not an affiliation of the trustee.
Item 16. List of Exhibits
List below all exhibits filed as part of this Statement of Eligibility.
*Exhibit 1 A copy of the articles of incorporation of the trustee as now in
effect. (Incorporated by reference from Exhibit 1 filed with T-1 Statement,
Registration Statement No. 33-3984.)
*Exhibit 2 A copy of the certificate of authority of the trustee to commence
business. (Incorporated by reference from Exhibit 2 filed with T-1 Statement,
Registration Statement No. 33-3984.)
*Exhibit 3 A copy of the certificate of the authority of the trustee to
exercise corporate trust powers. (Incorporated by reference from Exhibit 3 filed
with T-1 Statement, Registration Statement No. 33-3984.)
<PAGE>
Exhibit 4 A copy of the existing by-laws of the trustee.
Exhibit 5 Not applicable.
Exhibit 6 The consent of the trustee required by Section 321(b) of the Act.
Exhibit 7 A copy of the latest report of the condition of the trustee
published pursuant to law or the requirements of its supervising or examining
authority.
Exhibit 8 Not applicable.
Exhibit 9 Not applicable.
*The Exhibits thus designated are incorporated herein by reference. Following
the description of such Exhibits is a reference to the copy of the Exhibits
heretofore filed with the Securities and Exchange Commission, to which there
have been no amendments or changes.
<PAGE>
Signature
Pursuant to the requirements of the Trust Indenture Act of 1939, the trustee,
Crestar Bank, a corporation organized and existing under the laws of the
Commonwealth of Virginia, has duly caused this statement of eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of Richmond, and the Commonwealth of Virginia, on the fifteenth day of May,
1997.
Crestar Bank
By: /s/ L.B. BEDELL
- ------------------------------
(L. B. Bedell, Vice President)
<PAGE>
BYLAWS
OF
CRESTAR BANK
Incorporated Under The Laws
Of The Commonwealth Of Virginia
Adopted December 20, 1979
(And Including Amendments Adopted
Thereto Through July 23, 1999)
<PAGE>
INDEX
TO
BYLAWS
OF
CRESTAR BANK
Article I - Meetings Of Stockholders
1.1 - Place of Meetings..................................1
1.2 - Annual Meetings....................................1
1.3 - Special Meetings...................................1
1.4 - Action by Stockholders.............................1
1.5 - Action in Lieu of Meeting..........................1
1.6 - Conduct of Meetings................................1
Article II - Board Of Directors
2.1 - General Powers.....................................1
2.2 - Number of Directors................................2
2.3 - Quorum.............................................2
2.4 - Vacancy............................................2
2.5 - Term of Office.....................................2
2.6 - Meetings of the Board..............................2
2.7 - Compensation.......................................3
2.8 - Eligibility........................................3
Article III - Committees
3.1 - Standing Committees................................3
3.2 - Executive Committee................................4
3.3 - Audit Committee....................................4
3.4 - Human Resources and Compensation Committee.........5
3.5 - Nominating and Governance Committee................5
3.6 - Area Boards........................................5
3.7 - Other Committees...................................6
Article IV - Officers
4.1 - Number and Manner of Election or Appointment.......6
4.2 - Term of Office.....................................6
4.3 - Removal............................................6
4.4 - Resignations.......................................6
4.5 - Vacancies, New Offices and Promotions..............6
<PAGE>
Article IV - Officers (continued)
4.6 - Chairman of the Board..............................7
4.7 - President..........................................7
4.8 - Corporate Secretary................................7
4.9 - Treasurer..........................................7
4.10 - Powers and Duties of Other Officers................7
Article V - Indemnification Of Directors And Officers
5.1 - Extent of Indemnification..........................8
5.2 - Insurance..........................................8
5.3 - Change in Board Composition........................8
5.4 - Miscellaneous......................................9
Article VI - Miscellaneous Provisions
6.1 - Voting of Stock Held...............................9
6.2 - Fiscal Year........................................9
6.3 - Amendments.........................................9
<PAGE>
APPENDIX - Administrative Regulations
Administrative Regulation I
Sales, Purchase and Pledge or Deposit of Securities Owned by the Bank
<TABLE>
<CAPTION>
<S> <C>
1.1 - Sale, Purchase and Pledge or Deposit of Securities..............................................1
Administrative Regulation II
Exercise of Fiduciary Powers
2.1 - Certification, Authentication, etc. of Securities and Documents.................................1
2.2 - Qualification as Fiduciary......................................................................2
2.3 - Acceptance of Trusts............................................................................2
2.4 - Purchase and Sales of Securities................................................................2
2.5 - Deposit of Securities Under Plans Reorganizations, etc..........................................2
2.6 - Sales, and Leases of Real Estate and Tangible Personal Property:
Foreclosure and Extension of Mortgages..........................................................2
2.7 - All Acts Done Under the Foregoing Paragraphs....................................................3
2.8 - Voting Stock and Other Securities...............................................................3
Administrative Regulation III
Borrowing Money, Rediscount of Bills and Notes, Buying or Selling Funds
3.1 - Borrowed Money, Security Therefor and Rediscounts...............................................3
3.2 - Purchase and Sales of Surplus Funds.............................................................3
Administrative Regulation IV
Release of Encumbrances
4.1 - Sales and Leases of Property....................................................................4
4.2 - Release Of Encumbrances.........................................................................4
Administrative Regulation V
Checks, Drafts, Orders, etc.
5.1 - Bank - Except Trust.............................................................................4
5.2 - Trust Group.....................................................................................4
Administrative Regulation VI
Signature Guarantee, Confirmations, etc.
6.1 - Signature Guarantee.............................................................................4
6.2 - Confirmations...................................................................................5
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
Administrative Regulation VII
Responsibility of Area Boards
7.1 - Responsibilities of Area Boards.................................................................5
Administrative Regulation VIII
Deposit and Security Accounts
8.1 - Deposit Accounts................................................................................5
8.2 - Security Accounts...............................................................................6
</TABLE>
<PAGE>
CRESTAR BANK
BYLAWS
Article I
---------
Meetings Of Stockholders
1.1 Place of Meetings. All meetings of the stockholders shall be held at
such place, either within or without the Commonwealth of Virginia, as may be
designated by the Board of Directors.
1.2 Annual Meeting. The annual meeting of stockholders, for the election of
Directors and transaction of such other business as may come before the meeting,
shall be held on the fourth Friday in April of each year or at such other time
and date as designated by the Board of Directors.
1.3 Special Meetings. Special meetings of the stockholders for any purpose
or purposes may be called at any time by the Chairman of the Board, by the
President, or by a majority of the Board of Directors. No business shall be
transacted and no corporate action shall be taken at a special meeting other
than that stated in the notice of the meeting.
1.4 Action by Stockholders. Whenever Chapter 9 of Title 13.1 of the Code of
Virginia or these Bylaws requires the Board of Directors to take any action or
to recommend or approve any proposed corporate act, such action, recommendation
or approval shall not be required if the proposed action or corporate act is
adopted by the unanimous consent of stockholders.
1.5. Action in Lieu of Meeting. Any action required or permitted to be
taken by the stockholders may be taken without a meeting if all the stockholders
entitled to vote consent in writing authorizing the action, which consent shall
be filed with the corporate records. Any action taken by written consent shall
be effective according to its terms when all consents are in the possession of
the Bank's Corporate Secretary, unless an effective date is otherwise specified
in such consent.
1.6 Conduct of Meetings. At each meeting of the stockholders, the Chairman
of the Board or the President shall act as chairman and preside. In their
absence, the Chairman of the Board may designate another officer of the Bank who
need not be a Director to preside. The Corporate Secretary of the Bank or an
Assistant Corporate Secretary, or in their absence, a person whom the chairman
of such meeting shall appoint, shall act as corporate secretary of such meeting.
Article II
----------
Board Of Directors
2.1 General Powers. The business and affairs of the Bank shall be managed
by the Board of Directors and, except as otherwise expressly provided by law, in
accordance with the Articles of Incorporation or these Bylaws.
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2.2 Number of Directors. The Board of Directors shall consist of not less
than five nor more than seventeen Directors, the exact number to be designated
by the Board.
2.3 Quorum. A majority of the number of Directors pursuant to these Bylaws
at the time of the meeting shall constitute a quorum for the transaction of
business. The act of a majority of Directors present at a meeting at which a
quorum is present shall be the act of the Board of Directors. Less than a quorum
may adjourn any meeting.
2.4 Vacancy. Any vacancy occurring in the Board of Directors may be filled
by the affirmative vote of the majority of the remaining Directors, though less
than a quorum of the Board, unless the vacancy is sooner filled by the
stockholders.
2.5 Term of Office. Each Director, unless he or she dies, resigns, retires
or is removed from office, shall hold office until the next annual meeting, and
may be reelected for successive terms.
2.6 Meetings of the Board.
(a) Place of Meetings. Meetings of the Board of Directors shall be held at
such place and at such time, either within or without the Commonwealth of
Virginia, as may be designated by the Board, or upon call of the Chairman of the
Board or the President.
(b) Organizational Meeting. An organizational meeting shall be held as soon
as practicable after the adjournment of the annual meeting of stockholders at
which the Board of Directors is elected, for the purpose of taking the oaths of
the Directors, electing officers, appointing committees for the ensuing year,
and transacting such other business as may properly come before the meeting.
(c) Regular Meetings. Regular meetings of the Board of Directors shall be
held at such time and place as the Board may designate, and no notice thereof
need be given.
(d) Special Meetings. Special meetings of the Board of Directors may be
held at any time or place upon the call of the Chairman of the Board or the
President, or any three members of the Board.
(e) Notice. Notice of each such meeting shall be given to each Director by
mail at his or her business or residence address at least forty-eight hours
before the meeting, or by telephone or facsimile notice to him or her at least
twenty-four hours before the meeting. Meetings may be held at any time without
notice if all of the Directors are present, or if those not present waive notice
in writing either before or after the meeting. The notice of meetings of the
Board need not state the purpose of the meeting.
(f) Conduct of Meetings. At each meeting of the Board of Directors, the
Chairman of the Board or the President shall act as chairman and preside. In
their absence, the Chairman of the Board may designate another officer of the
Bank, who need not be a Director, to preside. The Corporate Secretary of the
Bank or an Assistant Corporate Secretary, or in their absence, a person whom the
chairman of such meeting shall appoint, shall act as corporate secretary of such
meeting.
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(g) Action in Lieu of Meeting. Any action required or permitted to be taken
by the Board may be taken without a meeting if all Directors consent in writing
to the adoption of a resolution authorizing the action. The resolution and the
written consents of the Directors shall be filed with the minutes of the
proceedings of the Board meeting.
2.7 Compensation. Directors, and members of any committee of the Board who
are not officers of the Bank or subsidiaries thereof, shall be paid such
compensation as the Board of Directors from time to time may determine for his
or her services as Director, or as Chairman or a member of any committee of the
Board, and shall, in addition, be reimbursed for such expenses as shall be
incurred by the Director in the performance of his or her duties. Nothing herein
shall preclude Directors and members of any committee of the Board from serving
the Bank in other capacities and receiving compensation therefor.
2.8 Eligibility. No person shall be eligible for election or reelection
after he or she attains the age of sixty-five. Upon reaching the age of
sixty-five or when a Director's responsibilities in his or her business or
profession terminate or are reduced, the Director shall submit to the Nominating
& Governance Committee a letter offering to resign from the Board, and the
Committee will recommend to the Board the action to be taken on the letter,
based upon the Board's Guiding Principles of Corporate Governance. Any Director
who is an officer of the Bank or any affiliate of the Bank shall retire as a
Director upon his resignation, termination or retirement as an employee of the
Bank or affiliate, and shall be ineligible to serve as a Director thereafter.
Notwithstanding anything in this paragraph to the contrary, any Director of
Crestar Bank who is elected to serve on the Board of SunTrust Banks, Inc. may
continue to serve as a Director of Crestar Bank until his or her service on the
Board of SunTrust Banks, Inc. ends.
Article III
-----------
Committees
3.1 Standing Committees.
(a) Number. There shall be four standing committees of the Board of
Directors which shall be comprised only of Directors. The standing committees
are as follows: Executive, Audit, Human Resources & Compensation, and Nominating
& Governance. In order to broaden the experience of Directors, it shall be the
policy of the Bank to seek rotation among Directors as members of the various
committees.
At the first meeting of the Board of Directors after the annual meeting of the
stockholders, the Chairman of the Board shall recommend the membership of each
committee and the Board shall elect the membership of each committee, who shall
serve at the pleasure of the Board.
(b) Quorum. A majority of the number of members of any standing committee
shall constitute a quorum for the transaction of business. The action of a
majority of members present at a committee meeting at which a quorum is present
shall constitute the act of the committee.
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(c) Action in Lieu of Meetings. Any action required or permitted to be
taken by the committee may be taken without a meeting if all members of the
committee consent in writing to the adoption of a resolution authorizing the
action. The resolution and written consents of the members shall be filed with
the minutes of the proceedings of the committee.
(d) Meetings and Minutes. Subject to the foregoing, and unless the Board
shall otherwise decide, each committee shall fix its rules of procedure,
determine its action and fix the time and place of its meetings. Special
meetings of a committee may be held at any time upon the call of the Chairman of
the Board, the Chairman of the committee, or any two members of the committee.
Each committee shall keep minutes of all meetings, which shall be at all times
available to Directors. Action taken by a committee shall be reported promptly
to the Board but not less frequently than quarterly.
(e) Term of Office. A member of any standing committee shall hold office
until the next organizational meeting of the Board of Directors or until he or
she is removed or ceases to be a Director.
(f) Vacancy. Should a vacancy occur on any standing committee resulting
from any cause whatsoever, the Board, by resolution, may fill such vacancy at
any time.
(g) Resignation and Removal. A member of a standing committee may resign at
any time by giving written notice of his or her intention to do so to the
Chairman of the Board or the Corporate Secretary of the Bank, and may be removed
at any time by the Board of Directors.
3.2 Executive Committee.
(a) How Constituted. The Executive Committee shall consist of not less than
five nor more than seven Directors, including the Chairman of the Board, who
shall be Chairman of the Committee, and the President. If the Chairman of the
Board will not be present at a meeting, the President shall preside, and if the
President will not be present, the Chairman may designate another officer of the
Bank, who need not be a member of the Committee or a Director, to preside at the
meeting.
(b) Primary Responsibility. The Executive Committee shall exercise all
powers of the Board of Directors between meetings of the Board except as to
matters exclusively reserved to the Board under Virginia law.
3.3 Audit Committee
(a) How Constituted. The Audit Committee shall consist of not less than
three nor more than seven Directors, none of whom shall be officers of the Bank
or any subsidiary thereof. The Chairman of the Committee shall be appointed by
the Board of Directors upon recommendation of the Chairman of the Board. If the
Chairman of the Committee will not be present at a meeting, he or she may
designate any member of the Committee to preside at the meeting.
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(b) Primary Responsibilities. The Audit Committee shall review the scope of
the independent accountant's examination and approval of any non-audit services
to be performed by the independent accountants; review examination reports by
the independent accountants and regulatory agencies; review credit issues, loan
policies and procedures, the classification of loans and the adequacy of the
allowance for loan losses; monitor the credit process review function; review
Crestar's Community Reinvestment Act policy, plans and performance; and review
internal programs to assure compliance with laws and regulations and the
adequacy of internal controls.
3.4 Human Resources & Compensation Committee.
(a) How Constituted. The Human Resources & Compensation Committee shall
consist of not less than three nor more than seven Directors, none of whom shall
be officers of the Bank or any subsidiary thereof. The Chairman of the Committee
shall be appointed by the Board of Directors upon recommendation of the Chairman
of the Board. If the Chairman of the Committee will not be present at a meeting,
he or she may designate any member of the Committee to preside at the meeting.
(b) Primary Responsibilities. The Human Resources & Compensation Committee
shall recommend officers requiring Board approval and recommend any titling
changes and management succession involving senior officers of the Bank; review
other matters pertaining to management structure, succession planning, executive
development and executive compensation; and recommend changes in Director
compensation.
3.5 Nominating & Governance Committee
(a) How Constituted. The Nominating & Governance Committee shall consist of
not less than three nor more than five Directors, none of whom shall have served
as an officer of the Bank or any subsidiary thereof within the calendar year of
appointment or the calendar year immediately preceding the year of appointment.
The Chairman of the Committee shall be appointed by the Board of Directors upon
recommendation of the Chairman of the Board. If the Chairman of the Committee
will not be present at a meeting, he or she may designate any member of the
Committee to preside at the meeting.
(b) Primary Responsibilities. The Nominating & Governance Committee shall
interpret the Bylaws whenever a Director's change in circumstance, such as
illness, retirement or modification of primary employment, may affect
eligibility for continued Board service; recommend changes in eligibility
requirements to ensure that the Board consists of highly-qualified persons who
can contribute to the business of the Bank and be representative of Crestar
constituencies; study board governance practices of similarly-situated
corporations and recommend adoption of Crestar corporate governance guidelines;
monitor effectiveness of such guidelines and implement any modificationof such
guidelines; and establish and implement a nomination process to identify and
recommend Board nominees.
3.6 Area Boards. The Board of Directors or the Chairman of the Board may
appoint Area Boards for the Bank's locations. Area Boards shall serve at the
pleasure of the Board of Directors or the Chairman of the Board and their duties
shall be those prescribed in the Administrative Regulations.
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3.7 Other Committees. The Board of Directors may, by resolution, establish
such other standing committees of the Board as it may deem advisable. The
members, terms and authority of such committees shall be as set forth in the
resolutions.
The Chairman of the Board may establish such other special committees of the
Board of Directors as he deems advisable, and may appoint the members of such
committees. Any such committees shall have the authority to consider, review,
advise and recommend to the Chairman of the Board with respect to such matters
as may be referred to it by the Chairman of the Board, but shall have no
authority to act for the Bank except with the prior approval of the Board of
Directors.
Article IV
----------
Officers
4.1 Number and Manner of Election or Appointment. The officers of the Bank
shall be:
(a) The Chairman of the Board, the President, a Corporate Secretary, a
Treasurer, one or more Regional Presidents, and one or more Corporate Executive
Vice Presidents, each of whom shall be elected by the Board.
(b) Such other officers as the Chairman of the Board or President may deem
necessary, each of whom shall be appointed by the Chairman of the Board or
President or their designees. One person may hold more than one office.
4.2 Term of Office. The officers designated in Section 4.1(a) shall be
elected annually by the Board at its organizational meeting. Such officers shall
each hold office until the next organizational meeting of the Board or until
their successors are elected. The officers designated in Section 4.1(b) may be
appointed at any time by the Chairman of the Board of the President or their
designees.
4.3 Removal. Any officer may be removed from office, with or without cause,
at any time, by the Board of Directors. Any officer appointed by the Chairman of
the Board or the President or their designees may be removed from office by any
of such appointing officers with or without cause at any time.
4.4 Resignations. Any officer may resign at any time by giving written
notice to the Board, Human Resources & Compensation Committee, Chairman of the
Board, President, or the Corporate Secretary. Such resignation shall be
effective on the date of receipt of such notice or any later date specified
therein, and unless otherwise specified therein, the acceptance of such
resignation shall not be necessary to make it effective.
4.5 Vacancies, New Offices and Promotions. A vacancy from any cause in any
office may be filled at any time for the unexpired portion of the term, in the
manner prescribed in these Bylaws for regular election or appointment to such
office. New offices may be created and filled, and the promotions and changes in
officers' titles may be made at any time in the manner prescribed in these
Bylaws for regular election or appointment to such office.
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4.6 Chairman of the Board. The Chairman of the Board shall be the Chief
Executive Officer and shall have general supervision of the policies and
operations of the Bank, subject to the direction and control of the Board. He or
she shall preside at all meetings of the stockholders, the Board of Directors
and the Executive Committee. He shall be responsible for extending lines of
credit and other loan commitments, for making loans and for discounting
acceptable trade paper. All such extensions of credit shall be based on
acceptable credit risk. Subject to his executive authority and control, the
Chairman of the Board may delegate specific loan authority to officers and
employees of the Bank. The Chairman shall have the power to sign checks, orders,
contracts, leases, notes, drafts and other documents and instruments in
connection with the business of the Bank, and have such other powers and perform
such other duties as shall be designated by the Board of Directors or as may be
incidental to his or her office.
4.7 President. The President shall participate in the supervision of the
policies and management of the Bank, and may, if so designated by the Board of
Directors, be the chief operating officer of the Bank. He or she shall perform
all duties incidental to the office of President and shall perform such other
duties as may be assigned to him or her from time to time by the Board of
Directors or the Chairman of the Board. In the absence of the Chairman of the
Board, he or she shall preside at meetings of stockholders, the Board of
Directors and the Executive Committee. The President shall have the same power
to sign for the Bank and to appoint officers as prescribed in these Bylaws for
the Chairman of the Board.
4.8 Corporate Secretary. The Corporate Secretary shall: a) keep the minutes
of all meetings of the stockholders, the Board of Directors, and the Board
Committees; b) see that all notices of such meetings are given in accordance
with these Bylaws or as required by law; c) be custodian of the corporate
records and of the seal of the Bank and have authority to affix the seal to any
documents requiring such seal and to attest the same; d) sign, with the Chief
Executive Officer, certificates for shares of the Bank, the issuance of which
shall have been authorized by resolution of the Board of Directors; and e) in
general perform all duties incident to the office of Corporate Secretary and
such other duties as from time to time may be assigned to him or her by the
Board of Directors or the Chief Executive Officer. In the absence of the
Corporate Secretary, an Assistant Corporate Secretary shall act in his or her
stead. The Corporate Secretary or Assistant Corporate Secretary may designate
one or more officers of the Corporation to act as Attesting Corporate Secretary
for the sole purpose of attesting to another officer's signature and affixing
the seal of the Corporation.
4.9 Treasurer. The Treasurer shall perform such duties with respect to
securities and funds of the Bank as may be prescribed by the Board of Directors
or the Chief Executive Officer, and such other duties as may be incidental to
the office of Treasurer.
4.10 Powers and Duties of Other Officers. The powers and duties of all
other officers of the Bank shall be those usually pertaining to their respective
offices, subject to the direction and control of the Board of Directors and as
otherwise provided in these Bylaws, or as prescribed by the Chief Executive
Officer.
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Article V
---------
Indemnification Of Directors And Officers
5.1 Extent of Indemnification.
(a) To the full extent that the Virginia Stock Corporation Act, as it
exists on the date hereof or may hereafter be amended, permits the limitation or
elimination of the liability of directors or officers, a Director or officer of
the Bank shall not be liable to the Bank or its stockholders for monetary
damages.
(b) To the full extent permitted and in the manner prescribed by Chapter 9
of Title 13.1 of the Code of Virginia, and any other applicable law, the Bank
and its affiliates shall indemnify a Director or officer of the Bank who is or
was a party to any proceeding by reason of the fact that he or she is or was
such a Director or officer or is or was serving at the request of the Bank as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust, employee benefit plan or other enterprise. The Board of
Directors, by majority vote of a quorum of disinterested Directors or the
Chairman of the Board is empowered to contract in advance to indemnify any
Director or officer.
(c) The Board of Directors, by majority vote of a quorum of disinterested
Directors, or the Chairman of the Board is empowered to cause the Bank to
indemnify or contract in advance to indemnify any person not specified in
Section B of this Article who was or is a party to any proceeding, by reason of
the fact that he is or was an employee or agent of the Bank, or is or was
serving at the request of the Bank as a director, officer, employee or agent of
another corporation, partnership, joint venture, trust, employee benefit plan or
other enterprise, to the same extent as if such person were specified as one to
whom indemnification is granted in Section 5.1(b).
5.2 Insurance. The Bank or any of its affiliates may purchase and maintain
insurance to indemnify it against the whole or any portion of the liability
assumed by it in accordance with this Article and may also procure insurance on
behalf of any person who is or was a Director, officer, employee or agent of the
Bank, or is or was serving at the request of the Bank as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise, against any liability asserted
against or incurred by such person in any such capacity or arising from his
status as such, whether or not the Bank would have power to indemnify him or her
against such liability under the provisions of this Article.
5.3 Change in Board Composition. In the event there has been a change in
the composition of a majority of the Board of Directors after the date of the
alleged act or omission with respect to which indemnification is claimed, any
determination as to indemnification and advancement of expenses with respect to
any claim for indemnification made pursuant to Section 5.1(a) of this Article
shall be made by special legal counsel agreed upon by the Board of Directors and
the proposed indemnitee. If the Board of Directors and the proposed indemnitee
are unable to agree upon such special legal counsel, the Board of Directors and
the proposed indemnitee each shall select a nominee, and the nominees shall
select such special legal counsel.
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5.4 Miscellaneous. The provisions of this Article shall be applicable to
all actions, claims, suits or proceedings commenced after the adoption hereof,
whether arising from any action taken or failure to act before or after such
adoption. No amendment, modification or repeal of this Article shall diminish
the rights provided hereby or diminish the right to indemnification with respect
to any claim, issue or matter in any then pending or subsequent proceeding that
is based in any material respect on any alleged action or failure to act prior
to such amendment, modification or repeal. Reference herein to Directors,
officers, employees or agents shall include Area Board Directors, former
Directors, officers, employees and agents and their respective heirs, executors
and administrators.
Article VI
----------
Miscellaneous Provisions
6.1 Voting of Stock Held. Unless otherwise provided by resolution of the
Board of Directors or of the Executive Committee, the Chairman of the Board, the
President, or any Executive or Senior Vice President may from time to time
appoint an attorney or attorneys or agent or agents of this Bank, in the name
and on behalf of this Bank, to cast the vote which this Bank may be entitled to
cast as a stockholder or otherwise in any other corporation, any of whose stock
or securities may be held by this Bank, at meetings of the holders of the stock
or other securities of such other corporation, or to consent in writing to any
action by any such other corporation. Such officer shall instruct the person or
persons so appointed as to the manner of casting such votes or giving such
consent and may execute or cause to be executed on behalf of this Bank such
written proxies, consents, waivers or other instruments as may be necessary or
proper. In lieu of an appointment of an attorney or agent, the officer may
himself attend any meetings of the holders of stock of other securities of any
such other corporation and there vote or exercise any or all power of this Bank
as the holder of such stock or other securities of such other corporation.
6.2 Fiscal Year. The fiscal year of the Bank shall be the calendar year.
6.3. Amendments. These Bylaws may be amended, altered, or repealed at any
meeting of the Board of Directors by affirmative vote of a majority of the
number of Directors fixed at the time in accordance with Article II of these
Bylaws. The stockholders, entitled to vote in an election of Directors, shall
have the power to rescind, alter, amend or repeal any Bylaws and to enact Bylaws
which, if expressly so provided, may not be amended, altered or repealed by the
Board of Directors.
<PAGE>
APPENDIX
Administrative Regulation I
---------------------------
Sale, Purchase And Pledge Or Deposit Of Securities Owned By The Bank
1.1 Sale, Purchase and Pledge or Deposit of Securities. The President, the
Executive Vice President - Investment Bank, the Managing Director -
Asset/Liability Management Division, the Managing Director - Funds Management
Division, or such other officers of the Asset/Liability Management Division or
the Funds Management Division as any of the foregoing may designate in writing
(which designation shall be filed with the Corporate Secretary) are authorized
and empowered in its behalf at any time and from to time:
(a) To sell, assign, loan, sell under agreement to repurchase, transfer,
and deliver any and all securities of any description now or at any time
hereafter belonging to the Bank in its own right, or which the Bank is or shall
be authorized and empowered to sell, assign, or transfer as attorney for the
owners or holders thereof.
(b) To make any pledge or deposit of any of the bonds, notes, obligations
or any other securities belonging to the Bank (including any receipts issued by
any other banking institution evidencing the deposit by the Bank of any of its
securities with any other banking institution as custodian) including without
limitation the pledge or deposit with the Treasurer of the United States, or any
other public official or public authority, national, state or local, for the
purpose of securing (i) borrowings from the Federal Reserve Bank, (ii) deposits
for which security is or may be required or permitted by law at any time to be
given, (iii) sureties on surety bonds furnished to secure such deposits, or (iv)
deposits made, whether time or demand, by the Bank as sole or joint fiduciary of
any character. Any officer authorized hereunder to make such pledges or deposits
shall have power to make any endorsement, transfer or assignment of any such
securities, to make substitutions and withdrawals thereof, and to designate the
person or persons to whom on behalf of the Bank any such securities so withdrawn
may be delivered.
(c) To purchase, borrow, or purchase under agreement to resell for the
account of the Bank in its own right such bonds, stocks or other securities as
may be permitted by law.
(d) To do any act and to execute and acknowledge any document necessary to
the exercise of the powers hereby granted and to appoint attorneys-in-fact to do
such acts and execute such documents.
Administrative Regulation II
----------------------------
Exercise Of Fiduciary Powers
2.1 Certification, Authentication, etc., of Securities and Documents. Any
officer or employee of the Trust and Investment Management Group who may be
designated from time to time in writing (which designation shall be filed with
the Corporate Secretary) by either the President, the Executive Vice President
for Trusts, any Senior Vice President, or Vice President in the Trust and
Investment Management Group, to act as Special Corporate Assistant shall have
the authority to authenticate or certify, on behalf of the Bank, any bonds,
certificates, or other documents necessary or proper for the Bank to certify in
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its capacity as Trustee under any mortgage, deed of trust or other instrument,
and to sign or countersign in the name of the Bank (a) as Transfer Agent or
Registrar the certificates for the capital stock or the bonds or other
securities of any corporation for which the Bank may be at any time Transfer
Agent or Co-Transfer Agent, or Registrar or Co-Registrar, respectively, and (b)
as Depositary the receipts for any securities deposited with the Bank under any
agreement under which it may at any time be Depositary; and any of said officers
or employees authenticating, certifying, signing or countersigning any of such
bonds, certificates, stocks, securities, receipts and documents on behalf of the
Bank may do so under the title or style of "Authorized Officer" or "Authorized
Signature."
2.2 Qualification as Fiduciary. In all cases where the Bank shall be
appointed to act as Trustee, Executor, Administrator (with or without will
annexed), Curator, Guardian, Committee, Receiver, Special Commissioner, or in
any other lawful fiduciary capacity, any one of the following officers, namely:
The President, the Executive Vice President for Trusts, or any officer of the
Trust and Investment Management Group is authorized to take on behalf of the
Bank any oath, and to execute any bond required to be taken or executed, upon
the Bank's qualifying to act in such fiduciary capacity.
2.3 Acceptance of Trusts. The President, the Executive Vice President for
Trusts, or any officer in the Trust and Investment Management Group may accept
on behalf of the Bank any trust and sign his name to any instrument evidencing
such acceptance and acknowledge and deliver the same.
2.4 Purchase and Sales of Securities. Any of the following officers of the
Bank, namely: The President, the Executive Vice President for Trusts, or any
officer in the Trust and Investment Management Group, is authorized in the
exercise of powers conferred upon the Bank as fiduciary or agent, to buy, sell,
assign, transfer and deliver any bonds, stocks and other securities of every
description, standing in the name of this Bank as either sole or joint
fiduciary, or in the name of any ward for whom it is either sole guardian or
co-guardian, or of any decedent for whom it is either the sole personal
representative or one of the personal representatives, or which may be held by
it in any fiduciary or representative capacity whatsoever, either solely or in
conjunction with some other person or persons, whether registered or otherwise
(and to exchange registered for bearer or bearer for registered securities), and
any such officer so authorized shall have authority to appoint one or more
attorneys for that purpose and to execute and deliver on behalf of the Bank all
necessary and proper instruments for the purpose of effectuating the powers
hereby conferred.
2.5 Deposit of Securities Under Plans of Reorganizations, etc. Any of the
following officers of the Bank, namely: The President, the Executive Vice
President for Trusts, or any officer in the Trust and Investment Management
Group may deposit or authorize the deposit of the securities referred to in
paragraph 2.4 with any Committee or Depository under any plan of reorganization,
consolidation, merger or readjustment of any individual, corporation, firm or
association, and may approve any such plan, and may execute in the name of the
Bank in its appropriate fiduciary or representative capacity and deliver on its
behalf any protective committee agreement for any of the above mentioned
purposes.
2.6 Sales and Leases of Real Estate and Tangible Personal Property:
Foreclosure and Extension of Mortgages. Any of the following officers of the
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Bank, namely: The President, the Executive Vice President for Trusts, or any
officer of the Trust and Investment Management Group, in the exercise of powers
conferred upon the Bank as fiduciary or agent are authorized (i) to sell,
exchange or lease any real estate or tangible personal property or any interest
therein, which the Bank may hold in any fiduciary or representative capacity,
(ii) to grant options for purchase thereof, (iii) to cause the foreclosure of
any deed of trust or mortgage held by the Bank in any such fiduciary or
representative capacity, or (iv) to consent to the extension of the maturity of
any such deed of trust or mortgage.
2.7 All Acts Done Under the Foregoing Paragraphs numbered 2.2, 2.3, 2.4,
2.5 and 2.6 shall be reported to the Trust Administrative Committees, as may be
appropriate, provided that no action then taken by the Committees shall affect
the rights of third parties.
2.8 Voting Stock and Other Securities. The President, the Executive Vice
President for Trusts, or any officer of the Trust and Investment Management
Group shall have the power and authority to attend any meeting of the
stockholders or security holders of any corporation in which this Bank, as
fiduciary or agent, is a stockholder or security holder, and vote on behalf of
this Bank any such stock or securities; and any of them is hereby authorized and
empowered to designate, in writing, any person or persons as proxy, with power
of substitution, to attend and vote at such meeting such stock or securities on
behalf of this Bank; provided, however, that such proxy shall be empowered by
such writing to vote only on the matters and questions in the manner and to the
effect therein specified.
Administrative Regulation III
-----------------------------
Borrowing Money, Rediscounts Of Bills And Notes, Buying Or Selling Funds
3.1 Borrowed Money, Security Therefor and Rediscounts. Transactions with
the Federal Reserve Bank, or with any other bank in the nature of borrowings,
pledges or rediscounts by the Bank shall be by the President, the Executive Vice
President - Investment Bank, the Managing Director - Asset/Liability Management
Division, the Managing Director - Funds Management Division, or such other
officers of the Asset/Liability Management Division or the Funds Management
Division as any of the foregoing may designate in writing (which designation
shall be filed with the Corporate Secretary), and any of such officers is
severally authorized in the Bank's behalf at any time and from time to time:
(a) To borrow money for any temporary purpose and on such terms and for
such periods as he may deem wise;
(b) To pledge as security for the sums so borrowed, sell under repurchase
agreement, any and all securities, bills or notes, of every description
belonging to the Bank in its own right, including receipts of any other banking
institution evidencing deposit with it of any securities, bills or notes,
belonging to the Bank; or
(c) To rediscount any bills or notes belonging to the Bank in its own
right.
3.2 Purchase and Sale of Surplus Funds. The President, the Executive Vice
President - Investment Bank, the Managing Director - Asset/Liability Management
Division, the Managing Director - Funds Management Division, or such other
-3-
<PAGE>
officers of the Asset/Liability Management Division or the Funds Management
Division as any of them may designate in writing (which designation shall be
filed with the Corporate Secretary), are authorized to purchase or sell surplus
funds.
Administrative Regulation IV
----------------------------
Sales And Leases Of Property
4.1 Sales and Leases of Bank-Owned Real Estate and Associated Personal
Property. The President, any officer at the level of Vice President or above in
the Real Estate Division and in the Collections and Foreclosures Division of
Crestar Mortgage Corporation (and who is also a Vice President or above of the
Bank), any managing officer or Senior Vice President of any Special Assets or
loan workout unit, and any Senior Vice President in the Real Estate Finance
Group, are authorized (I) to sell, exchange or lease any Bank-owned real estate
and any associated personal property or any interest therein, (ii) to grant
options for the purchase thereof, and (iii) to do any act and to execute,
acknowledge and deliver any deed, contract and other document necessary or
desirable in connection therewith.
4.2 Release of Encumbrances. Any release, termination statement, or
satisfaction of judgment required by the Bank shall be executed by any officer
of the Bank or by an attorney-in-fact appointed by an officer of the Bank for
the purpose. Whenever the Bank may be lawfully required to consent to the
release of the lien of any deed of trust, its consent may be evidenced by the
execution of such deed of release or any other document on behalf of the Bank by
any officer of the Bank.
Administrative Regulation V
---------------------------
Checks, Drafts, Orders, Etc.
5.1 Bank - Except Trust. All checks, drafts or orders of the Bank for the
payment of money, whether directed to itself or to others (except those drawn on
trust funds), shall be executed or signed on behalf of the Bank by any officer
or, if authorized to sign by any officer (other than a member of the Trust and
Investment Management Group) who is a Division Head, Senior Vice President or
above, by any employee of the Bank, with a copy of such authorization filed with
the Corporate Controller.
5.2 Trust and Investment Management Group. All checks, drafts or orders of
the Trust and Investment Management Group for the payment of money, whether
directed to itself or others, shall be executed or signed on behalf of the Bank
by any officer or employee of the Trust and Investment Management Group who may
be authorized so to sign by any officer of the Trust and Investment Management
Group who is Senior Vice President or above, with a copy of such authorization
filed with the corporate Controller.
-4-
<PAGE>
Administrative Regulation VI
----------------------------
Signature Guarantee, Confirmations, Etc.
6.1 Signature Guarantee. Any officer of the Bank, or any employee of the
Bank who may be designated in writing (which designation shall be filed with the
Corporate Secretary) by the Chairman of the Board, the President, any Executive
Vice President, any Senior Vice President or Division Head, shall have the
authority to guarantee, on behalf of the Bank, the signature of a bank customer
or other person on any stock certificate, bond, note, or other security,
provided that such officer or employee shall know personally:
1. The person signing.
2. That the signature is genuine.
3. That the signer is an appropriate person to endorse or sign.
4. That the signer has legal capacity to sign.
Any such officer or employee guaranteeing any such signature may do so under the
style of "Authorized Officer" or "Authorized Signature".
6.2 Confirmations. The General Auditor or any Vice President Audit is
authorized to certify in the name of, or on behalf of, the Bank in its own right
or in a fiduciary or representative capacity, as to the accuracy and
completeness of any account, schedule of assets, instrument or paper requiring
such certification.
Administrative Regulation VII
-----------------------------
Responsibilities Of Area Boards
7.1 Responsibilities of Area Boards. The Area Boards, as provided by
Section 3.7 of the Bylaws, shall, jointly with senior management, assist in the
direction of one or more of the Bank's offices by: 1) ensuring an appropriate
commitment of the Bank to a significant role in the local community, , 2)
promoting the Bank through the acquisition of business and by personal example,
and 3)
providing an outside perspective as a constructive critic and loyal friend.
Administrative Regulation VIII
------------------------------
Deposit And Security Accounts
8.1 Deposit Accounts. The President, the Executive Vice President -
Investment Bank, the Executive Vice President, Controller and Treasurer, the
Managing Director - Asset/Liability Management Division, and the Managing
Director - Funds Management Division are individually authorized and empowered
to open and maintain in the name of the Bank one or more deposit accounts at
other financial institutions. The aforementioned officers shall designate the
personnel authorized to sign for and transact business in such accounts and may
agree to any terms governing such accounts. Any resolutions required of the Bank
in connection with such accounts may be certified by the Corporate Secretary as
if specifically adopted by the Board of Directors.
-5-
<PAGE>
8.2 Securities Accounts. The President, the Executive Vice President -
Investment Bank, the Managing Director - Asset/Liability Management Division,
and the Managing Director - Funds Management Division are individually
authorized and empowered to open and maintain in the name of the Bank one or
more securities accounts for the purpose of purchasing, selling, reselling,
borrowing, lending, and otherwise dealing in money market instruments and
securities of any and every kind, including agreements or contracts for their
repurchase or future delivery, with banks, brokers, dealers, securities firms,
or other organizations, and to issue written, telephonic, facsimile, or verbal
orders or instructions for transactions to be carried out in such accounts. The
aforementioned officers shall designate the personnel authorized to sign for and
transact business in such accounts and may agree to any terms governing such
accounts. Any resolutions required of this Bank in connection with such accounts
may be certified by the Corporate Secretary as if specifically adopted by the
Board of Directors.
-6-
<PAGE>
Federal Financial Institutions Examination Council
Board of Governors of the Federal Reserve System
OMB Number: 7100-0036
Federal Deposit Insurance Corporation
OMB Number: 3064-0052
Office of the Comptroller of the Currency
OMB Number: 1557-0081
Expires March 31, 2001
[LOGO]
Please refer to page i, Table of Contents, for the required disclosure of
estimated burden.
Consolidated Reports of Condition and Income for
A Bank With Domestic and Foreign Offices - FFIEC 031
Report at the close of business December 31, 1998
(19981231)
(RCRI 9999)
This report is required by law: 12 U.S.C. Section 324 (State member banks);
12 U.S.C. Section 1817 (State nonmember banks); and 12 U.S.C. Section 161
(National banks).
This report form is to be filed by banks with branches and consolidated
subsidiaries in U.S. territories and possessions, Edge or Agreement
subsidiaries, foreign branches, consolidated foreign subsidiaries, or
International Banking Facilities.
NOTE: The Reports of Condition and Income must be signed by an authorized
officer and the Report of Condition must be attested to by not less than
two directors (trustees) for State nonmember banks and three directors for
State member and National banks.
I, Richard G. Tilghman, Chairman and CEO
- ------------------------------------------------------------
Name and Title of Officer Authorized to Sign Report
of the named bank do hereby declare that the Reports of Condition and Income
(including the supporting schedules) for this report date have been
prepared in conformance with the instructions issued by the appropriate
Federal regulatory authority and are true to the best of my knowledge
and belief.
/s/ RICHARD G. TILGHMAN
- -------------------------------------
Signature of Officer Authorized to Sign Report
- -------------------------------------
Date of Signature
The Reports of Condition and Income are to be prepared in accordance
with Federal regulatory authority instructions.
We, the undersigned directors (trustees), attest to the correctness of
the Report of Condition (including the supporting schedules) for this
report date and declare that it has been examined by us and to the best
of our knowledge and belief has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and
is true and correct.
/s/ SIGNATURE ILLEGIBLE
- ----------------------------------
Director (Trustee)
/s/ SIGNATURE ILLEGIBLE
- ----------------------------------
Director (Trustee)
/s/ SIGNATURE ILLEGIBLE
- ----------------------------------
Director (Trustee)
Submission of Reports
Each bank must prepare its Reports of Condition and Income either:
(a) in electronic form and then file the computer data file directly
with the banking agencies' collection agent, Electronic Data Systems
Corporation (EDS), by modem or on computer diskette; or
(b) in hard-copy (paper) form and arrange for another party to convert the
paper report to electronic form. That party (if other than EDS) must
transmit the bank's computer data file to EDS.
For electronic filing assistance, contact EDS Call Report Services, 2150 N.
Prospect Ave., Milwaukee, WI 53202, telephone (800) 255-1571.
To fulfill the signature and attestation requirement for the Reports of
Condition and Income for this report date, attach this signature page to the
hard-copy record of the completed report that the bank places in its files.
FDIC Certificate Number ________________
(RCRI 9050)
Crestar Bank
P.O. Box 4418
Atlanta, GA 30302
0000047920 55124300000 12543
December 31, 1998
31
Board of Governors of the Federal Reserve System, Federal Deposit Insurance
Corporation, Office of the Comptroller of the Currency
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-1
Consolidated Report of Income
for the period January 1, 1999 - September 30, 1999
All Report of Income schedules are to be reported on a calendar year-to-date
basis in thousands of dollars.
Schedule RI--Income Statement
<TABLE>
<CAPTION>
I480
Dollar Amounts in Thousands RIAD
<S> <C>
1. Interest Income:
a. Interest and fee income on loans:
(1) In domestic offices:
(a) Loans secured by real estate 4011 567,694 1.a.(1)(a)
(b) Loans to depository institutions 4019 1,340 1.a.(1)(b)
(c) Loans to finance agricultural production and other loans to farmers 4024 187 1.a.(1)(c)
(d) Commercial and industrial loans 4012 219,022 1.a.(1)(d)
(e) Acceptances of other banks 4026 0 1.a.(1)(e)
(f) Loans to individuals for household, family, and other personal
expenditures:
(1) Credit cards and related plans 4054 61,678 1.a.(1)(f)(1)
(2) Other 4055 190,717 1.a.(1)(f)(2)
(g) Loans to foreign governments and official institutions 4056 590 1.a.(1)(g)
(h) Obligations (other than securities and leases) of states and political
subdivisions in the U.S.:
(1) Taxable obligations 4503 848 1.a.(1)(h)(1)
(2) Tax-exempt obligations 4504 16,431 1.a.(1)(h)(2)
(i) All other loans in domestic offices 4058 12,592 1.a.(1)(i)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs 4059 0 1.a.(2)
b. Income from lease financing receivables:
(1) Taxable leases 4505 33,469 1.b.(1)
(2) Tax-exempt leases 4307 2,641 1.b.(2)
c. Interest income on balances due from depository institutions:(1)
(1) In domestic offices 4105 30 1.c.(1)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs 4106 1,552 1.c.(2)
d. Interest and dividend income on securities:
(1) U.S. Treasury securities and U.S. Government agency obligations 4027 151,163 1.d.(1)
(including mortgage-backed securities issued or guaranteed by
FNMA, FHLMC, or GNMA)
(2) Securities issued by states and political subdivisions in the U.S.:
(a) Taxable securities 4506 0 1.d.(2)(a)
(b) Tax-exempt securities 4507 3,044 1.d.(2)(b)
(3) Other domestic debt securities 3657 54,132 1.d.(3)
(including mortgage-backed securities not issued or guaranteed by
FNMA, FHLMC, or GNMA)
(4) Foreign debt securities 3658 118 1.d.(4)
(5) Equity securities (including investments in mutual funds) 3659 7,444 1.d.(5)
e. Interest income from trading assets 4069 0 1.e.
</TABLE>
__________
(1) Includes interest income on time certificates of deposit not held for
trading.
3
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-2
Schedule RI--Continued
<TABLE>
<CAPTION>
Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
1. Interest income (continued)
f. Interest income on federal funds sold and securities purchased under
agreements to resell 4020 1,614 1.f.
g. Total interest income (sum of items 1.a through 1.f) 4107 1,326,306 1.g.
2. Interest expense:
a. Interest on deposits:
(1) Interest on deposits in domestic offices:
(a) Transaction accounts (NOW accounts, ATS accounts, and
telephone and preauthorized transfer accounts) 4508 4,790 2.a.(1)(a)
(b) Nontransaction accounts:
(1) Money market deposit accounts (MMDAs) 4509 164,392 2.a.(1)(b)(1)
(2) Other savings deposits 4511 16,468 2.a.(1)(b)(2)
(3) Time deposits of $100,000 or more A517 48,976 2.a.(1)(b)(3)
(4) Time deposits of less than $100,000 A518 121,218 2.a.(1)(b)(4)
(2) Interest on deposits in foreign offices, Edge and
Agreement subsidiaries, and IBFs 4172 899 2.a.(2)
b. Expense of federal funds purchased and securities sold under
agreements to repurchase 4180 185,046 2.b.
c. Interest on demand notes issued to the U.S. Treasury, trading
liabilities, and other borrowed money 4185 27,143 2.c.
d. Not applicable
e. Interest on subordinated notes and debentures 4200 37,675 2.e.
f. Total interest expense (sum of items 2.a through 2.e) 4073 606,607 2.f.
3. Net interest income (item 1.g minus 2.f) RIAD 4074 719,699 3.
4. Provisions:
a. Provision for credit losses RIAD 4230 41,953 4.a.
b. Provision for allocated transfer risk RIAD 4243 0 4.b.
5. Noninterest income:
a. Income from fiduciary activities 4070 66,770 5.a.
b. Service charges on deposit accounts in domestic offices 4080 113,554 5.b.
c. Trading revenue (must equal Schedule RI, sum of Memorandum
items 8.a through 8.d) A220 2,149 5.c.
d.-e. Not applicable
f. Other noninterest income:
(1) Other fee income 5407 124,274 5.f.(1)
(2) All other noninterest income* 5408 75,238 5.f.(2)
g. Total noninterest income (sum of items 5.a through 5.f) RIAD 4079 381,985 5.g
6. a. Realized gains (losses) on held-to-maturity securities RIAD 3521 0 6.a
b. Realized gains (losses) on available-for-sale securities RIAD 3196 4,268 6.b.
7. Noninterest expense:
a. Salaries and employee benefits 4135 341,931 7.a.
b. Expenses of premises and fixed assets (net of rental income)
(excluding salaries and employee benefits and mortgage interest) 4217 83,816 7.b.
c. Other noninterest expense* 4092 210,243 7.c.
d. Total noninterest expense (sum of items 7.a through 7.c) RIAD 4093 635,990 7.d.
8. Income (loss) before income taxes and extraordinary items and other
adjustments (item 3 plus or minus items 4.a, 4.b, 5.g, 6.a, 6.b, and 7.d) RIAD 4301 428,009 8.
9. Applicable income taxes (on item 8) RIAD 4302 148,353 9.
10. Income (loss) before extraordinary items and other adjustments (item 8
minus 9) RIAD 4300 279,656 10.
11. Extraordinary items and other adjustments, net of income taxes* RIAD 4320 0 11.
12. Net income (loss) (sum of items 10 and 11) RIAD 4340 279,656 12.
</TABLE>
_________
*Describe on Schedule RI-E--Explanations.
4
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-3
Schedule RI--Continued
<TABLE>
<CAPTION>
I481
Memoranda Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
1. Interest expense incurred to carry tax-exempt securities, loans, and leases
acquired after August 7, 1986, that is not deductible for federal income tax
purposes 4513 9,320 M.1.
2. Income from the sale and servicing of mutual funds and annuities in domestic
offices (included in Schedule RI, item 8) 8431 765 M.2.
3.-4. Not applicable
5. Number of full-time equivalent employees at end of current period Number
(round to nearest whole number) 4150 7,882 M.5.
6. Not applicable
7. If the reporting bank has restated its balance sheet as a result of applying
push down accounting this calendar year, report the date of the bank's RIAD CC YY MM DD
acquisition(1) 9106 00 00 00 00 M.7.
8. Trading revenue (from cash instruments and off-balance sheet derivative
instruments) (sum of Memorandum items 8.a through 8.d must equal
Schedule RI, item 5.c):
a. Interest rate exposures 8757 649 M.8.a.
b. Foreign exchange exposures 8758 1,500 M.8.b.
c. Equity security and index exposures 8759 0 M.8.c.
d. Commodity and other exposures 8760 0 M.8.d.
9. Impact on income of off-balance sheet derivatives held for purposes other
than trading:
a. Net increase (decrease) to interest income 8761 8,088 M.9.a.
b. Net (increase) decrease to interest expense 8762 (1,670) M.9.b.
c. Other (noninterest) allocations 8763 0 M.9.c.
10. Credit losses on off-balance sheet derivatives (see instructions) A251 0 M.10.
11. Does the reporting bank have a Subchapter S election in effect for federal YES NO
income tax purposes for the current tax year? A530 N/A M.11.
12. Deferred portion of total applicable income taxes included in Schedule RI,
items 9 and 11 (to be reported with the December Report of Income) 4772 N/A M.12.
</TABLE>
__________
(1) For example, a bank acquired on June 1, 1998, would report 1998/06/01.
* Describe on Schedule RI-E - Explanations.
5
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-4
Schedule RI-A--Changes in Equity Capital
Indicate decreases and losses in parentheses.
<TABLE>
<CAPTION>
I483
Dollar Amounts in Thousands RIAD
<S> <C>
1. Total equity capital originally reported in the December 31, 1997, Reports
of Condition and Income 3215 1,935,955 1.
2. Equity capital adjustments from amended Reports of Income, net* 3216 0 2.
3. Amended balance end of previous calendar year (sum of items 1 and 2) 3217 1,935,955 3.
4. Net income (loss) (must equal Schedule RI, item 12) 4340 279,656 4.
5. Sale, conversion, acquisition, or retirement of capital stock, net 4346 0 5.
6. Changes incident to business combinations, net 4356 0 6.
7. LESS: Cash dividends declared on preferred stock 4470 0 7.
8. LESS: Cash dividends declared on common stock 4460 129,000 8.
9. Cumulative effect of changes in accounting principles from prior years* (see
instructions for this schedule) 4411 0 9.
10. Corrections of material accounting errors from prior years* (see
instructions for this schedule) 4412 0 10.
11.a. Change in net unrealized holding gains (losses) on available-for-sale
securities 8433 (90,996) 11.a
b. Change in accumulated net gains (losses) on cash flow hedges 4574 0 11.b
12. Foreign currency translation adjustments 4414 0 12.
13. Other transactions with parent holding company* (not included in items 5, 7,
or 8 above) 4415 18,517 13.
14. Total equity capital end of current period (sum of items 3 through 13) (must
equal Schedule RC, item 28) 3210 2,014,132 14.
</TABLE>
__________
*Describe on Schedule RI-E--Explanations.
Schedule RI-B--Charge-offs and Recoveries on Loans and Leases and Changes
in Allowance for Credit Losses
Part I. Charge-offs and Recoveries on Loans and Leases
Part I excludes charge-offs and recoveries through
the allocated transfer risk reserve.
<TABLE>
<CAPTION>
I486
(Column A) (Column B)
Charge-offs Recoveries
Calendar year-to-date
Dollar Amounts in Thousands RIAD RIAD
<S> <C>
1. Loans secured by real estate:
a. To U.S. addressees (domicile) 4651 9,686 4661 2,472 1.a.
b. To non-U.S. addressees (domicile) 4652 0 4662 0 1.b.
2. Loans to depository institutions and acceptances of other banks:
a. To U.S. banks and other U.S. depository institutions 4653 0 4663 0 2.a.
b. To foreign banks 4654 0 4664 0 2.b.
3. Loans to finance agricultural production and other loans to farmers 4655 1 4665 5 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile) 4645 8,300 4617 1,473 4.a.
b. To non-U.S. addressees (domicile) 4646 0 4618 0 4.b.
5. Loans to individuals for household, family, and other personal
expenditures:
a. Credit cards and related plans 4656 19,417 4666 5,502 5.a.
b. Other (includes single payment, installment, and all student loans) 4657 11,734 4667 5,324 5.b.
6. Loans to foreign governments and official institutions 4643 0 4627 0 6.
7. All other loans 4644 517 4628 703 7.
8. Lease financing receivables:
a. Of U.S. addressees (domicile) 4658 0 4668 0 8.a.
b. Of non-U.S. addressees (domicile) 4659 0 4669 0 8.b.
9. Total (sum of items 1 through 8) 4635 49,655 4605 15,479 9.
</TABLE>
6
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-5
Schedule RI-B--Continued
Part I. Continued
<TABLE>
<CAPTION>
(Column A) (Column B)
Charge-offs Recoveries
Memoranda Calendar year-to-date
Dollar Amounts in Thousands RIAD RIAD
<S> <C>
1-3. Not applicable
4. Loans to finance commercial real estate, construction, and land
development activities (not secured by real estate) included in
Schedule RI-B, part I, items 4 and 7, above 5409 0 5410 0 M.4.
5. Loans secured by real estate in domestic offices (included in
Schedule RI-B, part I, item 1, above):
a. Construction and land development 3582 1,725 3583 0 M.5.a.
b. Secured by farmland 3584 70 3585 9 M.5.b.
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential
properties and extended under lines of credit 5411 1,708 5412 812 M.5.c.(1)
(2) All other loans secured by 1-4 family residential properties 5413 3,391 5414 1,059 M.5.c.(2)
d. Secured by multifamily (5 or more) residential properties 3588 88 3589 96 M.5.d.
e. Secured by nonfarm nonresidential properties 3590 2,704 3591 495 M.5.e.
</TABLE>
Part II. Changes in Allowance for Credit Losses
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RIAD
<S> <C>
1. Balance originally reported in the December 31, 1997, Reports of Condition
and Income 3124 280,076 1.
2. Recoveries (must equal part I, item 9, column B above) 2419 15,479 2.
3. LESS: Charge-offs (must equal or exceed part I, item 9, column A above) 2432 49,655 3.
4. Provision for credit losses (must equal Schedule RI, item 4.a) 4230 41,953 4.
5. Adjustments* (see instructions for this schedule) 4815 (13,028) 5.
6. Balance end of current period (sum of items 1 through 5)(must equal or exceed Schedule RC,
item 4.b) A512 274,825 6.
</TABLE>
__________
*Describe on Schedule RI-E--Explanations.
7
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-6
Schedule RI-D--Income from International Operations
For all banks with foreign offices, Edge or Agreement subsidiaries, or IBFs
where international operations account for more than 10 percent of total
revenues, total assets, or net income.
Part I. Estimated Income from International Operations
<TABLE>
<CAPTION>
I492
Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
1. Interest income and expense booked at foreign offices, Edge and Agreement
subsidiaries, and IBFs:
a. Interest income booked 4837 0 1.a.
b. Interest expense booked 4838 0 1.b.
c. Net interest income booked at foreign offices, Edge and Agreement
subsidiaries, and IBFs (item 1.a minus 1.b) 4839 0 1.c.
2. Adjustments for booking location of international operations:
a. Net interest income attributable to international operations booked at
domestic offices 4840 0 2.a.
b. Net interest income attributable to domestic business booked at foreign
offices 4841 0 2.b.
c. Net booking location adjustment (item 2.a minus 2.b) 4842 0 2.c.
3. Noninterest income and expense attributable to international operations:
a. Noninterest income attributable to international operations 4097 0 3.a.
b. Provision for loan and lease losses attributable to international operations 4235 0 3.b.
c. Other noninterest expense attributable to international operations 4239 0 3.c.
d. Net noninterest income (expense) attributable to international operations (item
3.a minus 3.b and 3.c) 4843 0 3.d.
4. Estimated pretax income attributable to international operations before
capital allocation adjustment (sum of items 1.c, 2.c, and 3.d) 4844 0 4.
5. Adjustment to pretax income for internal allocations to international
operations to reflect the effects of equity capital on overall bank funding
costs 4845 0 5.
6. Estimated pretax income attributable to international operations after
capital allocation adjustment (sum of items 4 and 5) 4846 0 6.
7. Income taxes attributable to income from international operations as
estimated in item 6 4797 0 7.
8. Estimated net income attributable to international operations (item 6 minus 7) 4341 0 8.
<CAPTION>
Memoranda
Dollar Amounts in Thousands RIAD
<S> <C>
1. Intracompany interest income included in item 1.a above 4847 0 M.1.
2. Intracompany interest expense included in item 1.b above 4848 0 M.2.
</TABLE>
Part II. Supplementary Details on Income from International Operations
Required by the Departments of Commerce and Treasury for Purposes of the U.S.
International Accounts and the U.S. National Income and Product Accounts
<TABLE>
<CAPTION>
Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
1. Interest income booked at IBFs 4849 0 1.
2. Interest expense booked at IBFs 4850 0 2.
3. Noninterest income attributable to international operations booked at
domestic offices (excluding IBFs):
a. Gains (losses) and extraordinary items 5491 0 3.a.
b. Fees and other noninterest income 5492 0 3.b.
4. Provision for loan and lease losses attributable to international operations
booked at domestic offices (excluding IBFs) 4852 0 4.
5. Other noninterest expense attributable to international operations booked at
domestic offices (excluding IBFs) 4853 0 5.
</TABLE>
8
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-7
Schedule RI-E--Explanations
Schedule RI-E is to be completed each quarter on a calendar year-to-date basis.
Detail all adjustments in Schedule RI-A and RI-B, all
extraordinary items and other adjustments in Schedule RI, and all
significant items of other noninterest income and other noninterest
expense in Schedule RI. (See instructions for details.)
<TABLE>
<CAPTION>
I495
Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
1. All other noninterest income (from Schedule RI, item 5.f.(2))
Report amounts that exceed 10% of Schedule RI, item 5.f.(2):
a. Net gains (losses) on other real estate owned 5415 0 1.a.
b. Net gains (losses) on sales of loans 5416 27,212 1.b.
c. Net gains (losses) on sales of premises and fixed assets 5417 0 1.c.
Itemize and describe the three largest other amounts that exceed 10% of
Schedule RI, item 5.f.(2):
d. TEXT 4461 4461 22,690 1.d.
e. TEXT 4462 4462 13,510 1.e.
f. TEXT 4463 4463 8,429 1.f.
2. Other noninterest expense (from Schedule RI, item 7.c):
a. Amortization expense of intangible assets 4531 26,777 2.a.
Report amounts that exceed 10% of Schedule RI, item 7.c:
b. Net (gains) losses on other real estate owned 5418 0 2.b.
c. Net (gains) losses on sales of loans 5419 0 2.c.
d. Net (gains) losses on sales of premises and fixed assets 5420 0 2.d.
Itemize and describe the three largest other amounts that exceed 10% of Schedule RI,
item 7.c:
e. TEXT 4464 4464 22,405 2.e.
f. TEXT 4467 4467 0 2.f.
g. TEXT 4468 4468 0 2.g.
3. Extraordinary items and other adjustments and applicable income tax effect
(from Schedule RI, item 11) (itemize and describe all extraordinary
items and other adjustments):
a. (1) TEXT 4469 6373 0 3.a.(1)
(2) Applicable income tax effect RIAD 4486 0 3.a.(2)
b. (1) TEXT 4487 4487 0 3.b.(1)
(2) Applicable income tax effect RIAD 4488 0 3.b.(2)
c. (1) TEXT 4489 4489 0 3.c.(1)
(2) Applicable income tax effect RIAD 4491 0 3.c.(2)
4. Equity capital adjustments from amended Reports of Income (from Schedule
RI-A, item 2) (itemize and describe all adjustments):
a. TEXT 4492 4492 0 4.a.
b. TEXT 4493 4493 0 4.b.
5. Cumulative effect of changes in accounting principles from prior years (from
Schedule RI-A, item 9) (itemize and describe all changes in accounting
principles):
a. TEXT 4494 Change in FAS 91 principles to conform to SunTrust 4494 0 5.a.
b. TEXT 4495 4495 0 5.b.
6. Corrections of material accounting errors from prior years (from Schedule
RI-A, item 10) (itemize and describe all corrections):
a. TEXT 4496 4496 0 6.a.
b. TEXT 4497 4497 0 6.b.
</TABLE>
9
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RI-8
Schedule RI-E--Continued
<TABLE>
<CAPTION>
Year-to-date
Dollar Amounts in Thousands RIAD
<S> <C>
7. Other transactions with parent holding company (from Schedule RI-A,
item 13) (itemize and describe all such transactions):
a. TEXT 4498 Capital contributions from Crestar Financial Corp 4498 18,517 7.a.
b. TEXT 4499 4499 0 7.b.
8. Adjustments to allowance for loan and lease losses (from Schedule RI-B,
part II, item 5) (itemize and describe all adjustments):
a. TEXT 4521 Reserve on loans sold 4521 (13,028) 8.a.
b. TEXT 4522 Reserve on loans purchased 4522 0 8.b.
9. Other explanations (the space below is provided for the bank to briefly
describe, at its option, any other significant items affecting the Report
of Income): I498 I499
No comment [X] (RIAD 4769)
Other explanations (please type or print clearly):
(TEXT 4769)
</TABLE>
10
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-1
Consolidated Report of Condition for Insured Commercial
and State-Chartered Savings Banks for March 31, 1998
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
Schedule RC--Balance Sheet
<TABLE>
<CAPTION>
C400
Dollar Amounts in Thousands RCFD
<S> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin(1) 0081 1,124,845 1.a.
b. Interest-bearing balances(2) 0071 2,998 1.b.
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A) 1754 0 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 4,884,760 2.b.
3. Federal funds sold and securities purchased under agreements to resell 1350 15,877 3.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RC-C) RCFD 2122 18,451,070 4.a.
b. LESS: Allowance for loan and lease losses RCFD 3123 274,825 4.b.
c. LESS: Allocated transfer risk reserve RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance,
and reserve (item 4.a minus 4.b and 4.c) 2125 18,176,245 4.d.
5. Trading assets (from Schedule RC-D) 3545 0 5.
6. Premises and fixed assets (including capitalized leases) 2145 438,070 6.
7. Other real estate owned (from Schedule RC-M) 2150 14,586 7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) 2130 15,080 8.
9. Customers' liability to this bank on acceptances outstanding 2155 6,105 9.
10. Intangible assets (from Schedule RC-M) 2143 344,150 10.
11. Other assets (from Schedule RC-F) 2160 636,537 11.
12. Total assets (sum of items 1 through 11) 2170 25,659,253 12.
</TABLE>
__________
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
11
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-2
Schedule RC--Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
<S> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C from Schedule RC-E,
part I) RCON 2200 17,461,014 13.a.
(1) Noninterest-bearing(1) RCON 6631 3,932,856 13.a.(1)
(2) Interest-bearing RCON 6636 13,528,158 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs (from Schedule
RC-E, part II) RCFN 2200 27,900 13.b.
(1) Noninterest-bearing RCFN 6631 0 13.b.(1)
(2) Interest-bearing RCFN 6636 27,900 13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase RCFD 2800 4,346,259 14.
15. a. Demand notes issued to the U.S. Treasury RCON 2840 484,504 15.a.
b. Trading liabilities (from Schedule RC-D) RCFD 3548 0 15.b.
16. Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases):
a. With a remaining maturity of one year or less RCFD 2332 57,834 16.a.
b. With a remaining maturity of more than one year through three years RCFD A547 10,596 16.b.
c. With a remaining maturity of more than three years RCFD A548 190,322 16.c.
17. Not applicable
18. Bank's liability on acceptances executed and outstanding RCFD 2920 6,105 18.
19. Subordinated notes and debentures(2) RCFD 3200 625,000 19.
20. Other liabilities (from Schedule RC-G) RCFD 2930 435,587 20.
21. Total liabilities (sum of items 13 through 20) RCFD 2948 23,645,121 21.
22. Not applicable
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus RCFD 3838 0 23.
24. Common stock RCFD 3230 146,955 24.
25. Surplus (exclude all surplus related to preferred stock) RCFD 3839 363,520 25.
26. a. Undivided profits and capital reserves RCFD 3632 1,565,061 26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities RCFD 8434 (61,404) 26.b.
c. Accumulated net gains (losses) on cash flow hedges RCFD 4336 0
27. Cumulative foreign currency translation adjustments RCFD 3284 0 27.
28. Total equity capital (sum of items 23 through 27) RCFD 3210 2,014,132 28.
29. Total liabilities and equity capital (sum of
items 21 and 28) RCFD 3300 25,659,253 29.
Memorandum
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best
describes the most comprehensive level of auditing work performed for the Number
bank by independent external auditors as of any date during 1997 RCFD 6724 N/A M.1.
</TABLE>
1 = Independent audit of the bank conducted in accordance with
generally accepted auditing standards by a certified public accounting
firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted
in accordance with generally accepted auditing standards by a
certified public accounting firm which submits a report on the
consolidated holding company (but not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with
generally accepted auditing standards by a certified public accounting
firm (may be required by state chartering authority)
4 = Directors' examination of the bank performed by other external
auditors (may be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external
auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
__________
(1) Includes total demand deposits and noninterest-bearing time and
savings deposits.
(2) Includes limited-life preferred stock and related surplus.
12
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-3
Schedule RC-A--Cash and Balances Due From Depository Institutions
Exclude assets held for trading.
<TABLE>
<CAPTION>
C405
(Column A) (Column B)
Consolidated Domestic
Bank Offices
Dollar Amounts in Thousands RCFD RCON
<S> <C>
1. Cash items in process of collection, unposted debits, and
currency and coin 0022 935,063 1.
a. Cash items in process of collection and unposted debits 0020 702,817 1.a.
b. Currency and coin 0080 232,246 1.b.
2. Balances due from depository institutions in the U.S. 0082 53,103 2.
a. U.S. branches and agencies of foreign banks
(including their IBFs) 0083 0 2.a.
b. Other commercial banks in the U.S. and other depository
institutions in the U.S. (including their IBFs) 0085 53,103 2.b.
3. Balances due from banks in foreign countries and foreign
central banks 0070 508 3.
a. Foreign branches of other U.S. banks 0073 0 3.a.
b. Other banks in foreign countries and foreign central banks 0074 508 3.b.
4. Balances due from Federal Reserve Banks 0090 139,169 0090 139,169 4.
5. Total (sum of items 1 through 4) (total of column A must
equal Schedule RC, sum of items 1.a and 1.b) 0010 1,127,843 0010 1,127,843 5.
</TABLE>
<TABLE>
<CAPTION>
Memorandum RCON
Dollar Amounts in Thousands
<S> <C>
1. Noninterest-bearing balances due from commercial banks
in the U.S. (included in item 2, column B above) 0050 50,105 M.1.
</TABLE>
Schedule RC-B--Securities
Exclude assets held for trading.
<TABLE>
<CAPTION>
C410
Held-to-maturity Available-for-sale
(Column A) (Column B) (Column C) (Column D)
Amortized Cost Fair Value Amortized Cost Fair Value(1)
Dollar Amounts in Thousands RCFD RCFD RCFD RCFD
<S> <C>
1. U.S. Treasury securities 0211 0 0213 0 1286 93,965 1287 94,077 1.
2. U.S. Government agency
obligations (exclude
mortgage-backed
securities):
a. Issued by U.S. Government
agencies(2) 1289 0 1290 0 1291 0 1293 0 2.a.
b. Issued by U.S. Government-
sponsored agencies(3) 1294 0 1295 0 1297 272,982 1298 267,382 2.b.
</TABLE>
__________
(1) Includes equity securities without readily determinable
fair values at historical cost in item 6.b, column D.
(2) Includes Small Business Administration "Guaranteed Loan
Pool Certificates," U.S. Maritime Administration obligations,
and Export-Import Bank participation certificates.
(3) Includes obligations (other than mortgage-backed securities)
issued by the Farm Credit System, the Federal Home Loan Bank
System, the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, the Financing Corporation,
Resolution Funding Corporation, the Student Loan Marketing
Association, and the Tennessee Valley Authority.
13
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-4
Schedule RC-B--Continued
<TABLE>
<CAPTION>
Held-to-maturity Available-for-sale
(Column A) (Column B) (Column C) (Column D)
Amortized Cost Fair Value Amortized Cost Fair Value(1)
Dollar Amounts in Thousands RCFD RCFD RCFD RCFD
<S> <C>
3. Securities issued by states
and political subdivisions
in the U.S.:
a. General obligations 1676 0 1677 0 1678 39,806 1679 40,256 3.a.
b. Revenue obligations 1681 0 1686 0 1690 47,863 1691 45,567 3.b.
c. Industrial development
and similar obligations 1694 0 1695 0 1696 0 1697 0 3.c.
4. Mortgage-backed securities
(MBS):
a. Pass-through securities:
(1) Guaranteed by GNMA 1698 0 1699 0 1701 65,877 1702 64,007 4.a.(1)
(2) Issued by FNMA and FHLMC 1703 0 1705 0 1706 2,450,120 1707 2,379,868 4.a.(2)
(3) Other pass-through
securities 1709 0 1710 0 1711 0 1713 0 4.a.(3)
b. Other mortgage-backed
securities (include CMOs,
REMICs, and stripped MBS):
(1) Issued or guaranteed by
FNMA, FHLMC, or GNMA 1714 0 1715 0 1716 383,354 1717 380,847 4.b.(1)
(2) Collateralized by MBS
issued or guaranteed
by FNMA, FHLMC, or GNMA 1718 0 1719 0 1731 50 1732 50 4.b.(2)
(3) All other mortgage-backed
securities 1733 0 1734 0 1735 0 1736 0 4.b.(3)
5. Other debt securities:
a. Other domestic debt
securities 1737 0 1738 0 1739 1,480,413 1741 1,461,639 5.a.
b. Foreign debt securities 1742 0 1743 0 1744 2,250 1746 2,250 5.b.
6. Equity securities:
a. Investments in mutual
funds and other equity
securities with readily
determinable fair values A510 10,838 A511 10,838 6.a.
b. All other equity
securities(1) 1752 137,904 1753 137,979 6.b.
7. Total (sum of items 1 through
6) (total of column A must
equal Schedule RC, item 2.a)
(total of column D must equal
Schedule RC, item 2.b) 1754 0 1771 0 1772 4,985,422 1773 4,884,760 7.
</TABLE>
__________
(1) Includes equity securities without readily determinable fair values at
historical cost in item 6.b, column D.
14
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-5
Schedule RC-B--Continued
<TABLE>
<CAPTION>
Memoranda C412
Dollar Amounts in Thousands RCFD
<S> <C>
1. Pledged securities(1) 0416 3,438,833 M.1.
2. Maturity and repricing data for debt securities(1),(2) (excluding those
in nonaccrual status):
a. Securities issued by the U.S. Treasury, U.S. Government agencies, and
states and political subdivisions in the U.S.; other non-mortgage
debt securities; and mortgage pass-through securities other than those
backed by closed-end first lien 1-4 family residential mortgages with a
remaining maturity or repricing frequency of: (3) (4)
(1) Three months or less A549 82,621 M.2.a.(1)
(2) Over three months through 12 months A550 45,986 M.2.a.(2)
(3) Over one year through three years A551 188,404 M.2.a.(3)
(4) Over three years through five years A552 427,356 M.2.a.(4)
(5) Over five years through 15 years A553 520,285 M.2.a.(5)
(6) Over 15 years A554 641,901 M.2.a.(6)
b. Mortgage pass-through securities backed by closed-end first lien 1-4
family residential mortgages with a remaining maturity or repricing
frequency of: (3) (5)
(1) Three months or less A555 23,574 M.2.b.(1)
(2) Over three months through 12 months A556 2,271 M.2.b.(2)
(3) Over one year through three years A557 20,785 M.2.b.(3)
(4) Over three years through five years A558 300,578 M.2.b.(4)
(5) Over five years through 15 years A559 1,988,999 M.2.b.(5)
(6) Over 15 years A560 112,286 M.2.b.(6)
c. Other mortgage-backed securities (include CMOs, REMICs, and stripped
MBS; exclude mortgage pass-through securities) with an expected
average life of: (6)
(1) Three years or less A561 233,623 M.2.c.(1)
(2) Over three years A562 147,274 M.2.c.(2)
d. Fixed rate AND floating rate debt securities with a REMAINING MATURITY
of one year or less (included in Memorandum items 2.a through 2.c above) A248 48,135 M.2.d.
3.-6. Not applicable
7. Amortized cost of held-to-maturity securities sold or transferred to
available-for-sale or trading securities during the calendar year-to-date
(report the amortized cost at date of sale or transfer) 1778 0 M.7.
8. Not applicable
9. Structured notes (included in the held-to-maturity and available-for-sale
accounts in Schedule RC-B, items 2, 3, and 5):
a. Amortized cost 8782 0 M.9.a.
b. Fair value 8783 0 M.9.b.
</TABLE>
- ------------------
(1) Includes held-to-maturity securities at amortized cost and
available-for-sale securities at fair value.
(2) Exclude equity securities, e.g., investments in mutual funds, Federal
Reserve stock, common stock, and preferred stock.
(3) Report fixed rate debt securities by remaining maturity and floating rate
debt securities by repricing frequency.
(4) Sum of Memorandum items 2.a.(1) through 2.a.(6) plus any nonaccrual debt
securities in the categories of debt securities reported in Memorandum item 2.a
that are included in Schedule RC-N, item 9, column C, must equal Schedule RC-B,
sum of items 1, 2, 3, and 5, columns A and D, plus mortgage pass-through
securities other than those backed by closed-end first lien 1-4 family
residential mortgages included in Schedule RC-B, item 4.a, columns A and D.
(5) Sum of Memorandum items 2.b.(1) through 2.b.(6) plus any nonaccrual mortgage
pass-through securities backed by closed-end first lien 1-4 family
residential mortgages included in Schedule RC-N, item 9, column C, must equal
Schedule RC-B, item 4.a, sum of columns A and D, less the amount of mortgage
pass-through securities other than those backed by closed-end first lien 1-4
family residential mortgages included in Schedule RC-B, item 4.a, columns
A and D.
(6) Sum of Memorandum items 2.c.(1) and 2.c.(2) plus any nonaccrual "Other
mortgage-backed securities" included in Schedule RC-N, item 9, column C, must
equal Schedule RC-B, item 4.b, sum of columns A and D.
15
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-6
Schedule RC-C--Loans and Lease Financing Receivables
Part I. Loans and Leases
Do not deduct the allowance for loan and lease losses from amounts reported in
this schedule. Report total loans and leases, net of unearned income. Exclude
assets held for trading and commercial paper.
<TABLE>
<CAPTION>
C415
(Column A) (Column B)
Consolidated Domestic
Bank Offices
Dollar Amounts in Thousands RCFD RCON
<S> <C>
1. Loans secured by real estate 1410 8,966,762 1.
a. Construction and land development 1415 445,601 1.a.
b. Secured by farmland (including farm residential and other improvements) 1420 24,534 1.b.
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential properties
and extended under lines of credit 1797 963,944 1.c.(1)
(2) All other loans secured by 1-4 family residential properties:
(a) Secured by first liens 5367 4,802,859 1.c.(2)(a)
(b) Secured by junior liens 5368 706,632 1.c.(2)(b)
d. Secured by multifamily (5 or more) residential properties 1460 162,514 1.d.
e. Secured by nonfarm nonresidential properties 1480 1,860,678 1.e.
2. Loans to depository institutions:
a. To commercial banks in the U.S. 1505 67,977 2.a.
(1) To U.S. branches and agencies of foreign banks 1506 0 2.a.(1)
(2) To other commercial banks in the U.S. 1507 67,977 2.a.(2)
b. To other depository institutions in the U.S. 1517 0 1517 0 2.b.
c. To banks in foreign countries 1510 2,935 2.c.
(1) To foreign branches of other U.S. banks 1513 0 2.c.(1)
(2) To other banks in foreign countries 1516 2,935 2.c.(2)
3. Loans to finance agricultural production and other loans to farmers 1590 2,949 1590 2,949 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile) 1763 3,527,072 1763 3,527,072 4.a.
b. To non-U.S. addressees (domicile) 1764 5,411 1764 5,411 4.b.
5. Acceptances of other banks:
a. Of U.S. banks 1756 0 1756 0 5.a.
b. Of foreign banks 1757 0 1757 0 5.b.
6. Loans to individuals for household, family, and other personal expenditures
(i.e., consumer loans) (includes purchased paper) 1975 4,108,217 6.
a. Credit cards and related plans (includes check credit and other revolving
credit plans) 2008 527,157 6.a.
b. Other (includes single payment, installment, and all student loans) 2011 3,581,060 6.b.
7. Loans to foreign governments and official institutions (including foreign
central banks) 2081 13,246 2081 13,246 7.
8. Obligations (other than securities and leases) of states and political
subdivisions in the U.S. (includes nonrated industrial development
obligations) 2107 454,244 2107 454,244 8.
9. Other loans 1563 466,467 9.
a. Loans for purchasing or carrying securities (secured and unsecured) 1545 65,394 9.a.
b. All other loans (exclude consumer loans) 1564 401,073 9.b.
10. Lease financing receivables (net of unearned income) 2165 835,790 10.
a. Of U.S. addressees (domicile) 2182 835,790 10.a.
b. Of non-U.S. addressees (domicile) 2183 0 10.b.
11. LESS: Any unearned income on loans reflected in items 1-9 above 2123 0 2123 0 11.
12. Total loans and leases, net of unearned income (sum of items 1 through 10
minus item 11) (total of column A must equal Schedule RC, item 4.a) 2122 18,451,070 2122 18,451,070 12.
</TABLE>
16
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-7
Schedule RC-C--Continued
Part I. Continued
<TABLE>
<CAPTION>
Memoranda
Dollar Amounts in Thousands
<S> <C>
1. Not applicable
2. Loans and leases restructured and in compliance with modified terms (included
in Schedule RC-C, part I, above and not reported as past due or nonaccrual in
Schedule RC-N, Memorandum item 1):
a. Loans secured by real estate:
(1) To U.S. addressees (domicle) RCFD 1687 0 M.2.a.(1)
(2) To non-U.S. addressees (domicile) RCFD 1689 0 M.2.a.(2)
b. All other loans and all lease financing receivables (exclude loans to
individuals for household, family, and other personal expenditures) RCFD 8691 0 M.2.b.
c. Commercial and industrial loans to and lease financing receivables of
non-U.S. addresses (domicile) included in Memorandum item 2.b above RCFD 8692 0 M.2.c.
3. Maturity and repricing data for loans and leases (excluding those in
nonaccrual status):
a. Closed-end loans secured by first liens on 1-4 family residential
properties in domestic offices with a remaining maturity or repricing
frequency of:(1)(2)
(1) Three months or less RCON A564 2,127,970 M.3.a.(1)
(2) Over three months through 12 months RCON A565 730,868 M.3.a.(2)
(3) Over one year through three years RCON A566 696,363 M.3.a.(3)
(4) Over three years through five years RCON A567 408,107 M.3.a.(4)
(5) Over five years through 15 years RCON A568 706,846 M.3.a.(5)
(6) Over 15 years RCON A569 102,989 M.3.a.(6)
b. All loans and leases (reported in Schedule RC-C, part I, items 1
through 10, column A) EXCLUDING closed-end loans secured by first liens
on 1-4 family residential properties in domestic offices (reported in
Schedule RC-C, part I, item 1.c.(2)(a), column B) with a remaining
maturity or repricing frequency of:(1)(3)
(1) Three months or less RCFD A570 7,922,000 M.3.b.(1)
(2) Over three months through 12 months RCFD A571 1,356,494 M.3.b.(2)
(3) Over one year through three years RCFD A572 2,235,233 M.3.b.(3)
(4) Over three years through five years RCFD A573 1,064,302 M.3.b.(4)
(5) Over five years through 15 years RCFD A574 924,718 M.3.b.(5)
(6) Over 15 years RCFD A575 107,020 M.3.b.(6)
c. Fixed rate AND floating rate loans and leases (reported in Schedule RC-C,
part I, items 1 through 10, Column A) with a REMAINING MATURITY
of one year or less RCFD A247 9,517,852 M.3.c.
d. Fixed rate AND floating rate loans secured by nonfarm nonresidential
properties in domestic offices(reported in Schedule RC-C, part I,
item 1.e, column B) with a REMAINING MATURITY of over
five years RCON A577 267,889 M.3.d.
e. Fixed rate AND floating rate commercial and industrial loans (reported
in Schedule RC-C, part I, item 4, column A) with a
REMAINING MATURITY of over three years RCFD A578 279,496 M.3.e.
</TABLE>
__________
(1) Report fixed rate loans and leases by remaining maturity and floating rate
loans by repricing frequency.
(2) Sum of Memorandum items 3.a.(1) through 3.a.(6) plus total nonaccrual
closed-end loans secured by first liens on 1-4 family residential properties
in domestic offices included in Schedule RC-N, Memorandum item 3.c.(2),
column C, must equal total closed-end loans secured by first liens on 1-4
family residential properties from Schedule RC-C, part I, item 1.c.(2)(a),
column B.
(3) Sum of Memorandum items 3.b.(1) through 3.b.(6), plus total nonaccrual
loans and leases from Schedule RC-N, sum of items 1 through 8, column C,
minus nonaccrual closed-end loans secured by first liens on 1-4 family
residential properties in domestic offices included in Schedule RC-N,
Memorandum item 3.c.(2), column C, must equal total loans and leases
from Schedule RC-C, part I, sum of items 1 through 10, column A, minus total
closed-end loans secured by first liens on 1-4 family residential properties
in domestic offices from Schedule RC-C, part I, item 1.c.(2)(a), column B.
17
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-8
Schedule RC-C--Continued
Part I. Continued
<TABLE>
<CAPTION>
Memoranda (continued)
Dollar Amounts in Thousands
<S> <C>
4. Loans to finance commercial real estate, construction, and land development
activities (not secured by real estate) included in Schedule RC-C, part I,
items 4 and 9, column A, page RC-6(1) RCFD 2746 0 M.4.
5. Loans and leases held for sale (included in Schedule RC-C, part I, page RC-6) RCFD 5369 1,037,623 M.5.
6. Adjustable rate closed-end loans secured by first liens on 1-4 family
residential properties in domestic offices (included in Schedule RC-C,
part I, item 1.c.(2)(a), column B, page RC-6) RCON 5370 1,011,230 M.6.
</TABLE>
__________
(1) Exclude loans secured by real estate that are included in Schedule RC-C,
part I, item 1, column A.
Schedule RC-D--Trading Assets and Liabilities
Schedule RC-D is to be completed only by banks with $1 billion or more in total
assets or with $2 billion or more in par/notional amount of off-balance sheet
derivative contracts (as reported in Schedule RC-L, items 14.a through 14.e,
columns A through D).
<TABLE>
<CAPTION>
C420
Dollar Amounts in Thousands
<S> <C>
ASSETS
1. U.S. Treasury securities in domestic offices RCON 3531 0 1.
2. U.S. Government agency obligations in domestic offices
(exclude mortgage-backed securities) RCON 3532 0 2.
3. Securities issued by states and political subdivisions in the U.S. in
domestic offices RCON 3533 0 3.
4. Mortgage-backed securities (MBS) in domestic offices:
a. Pass-through securities issued or guaranteed by FNMA, FHLMC, or GNMA RCON 3534 0 4.a.
b. Other mortgage-backed securities issued or guaranteed by FNMA, FHLMC, or
GNMA (include CMOs, REMICs, and stripped MBS) RCON 3535 0 4.b.
c. All other mortgage-backed securities RCON 3536 0 4.c.
5. Other debt securities in domestic offices RCON 3537 0 5.
6.-8. Not applicable
9. Other trading assets in domestic offices RCON 3541 0 9.
10. Trading assets in foreign offices RCFN 3542 0 10.
11. Revaluation gains on interest rate, foreign exchange rate, and other
commodity and equity contracts:
a. In domestic offices RCON 3543 0 11.a.
b. In foreign offices RCFN 3543 0 11.b.
12. Total trading assets (sum of items 1 through 11) (must equal Schedule RC,
item 5) RCFD 3545 0 12.
LIABILITIES
13. Liability for short positions RCFD 3546 0 13.
14. Revaluation losses on interest rate, foreign exchange rate, and other
commodity and equity contracts RCFD 3547 0 14.
15. Total trading liabilities (sum of items 13 and 14) (must equal Schedule
RC, item 15.b) RCFD 3548 0 15.
</TABLE>
18
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-9
Schedule RC-E--Deposit Liabilities
Part I. Deposits in Domestic Offices
<TABLE>
<CAPTION>
C425
Nontransaction
Transaction Accounts Accounts
(Column A) (Column B) (Column C)
Total transaction Memo: Total Total
accounts (including demand deposits nontransaction
total demand (included in accounts
deposits) column A) (including MMDAs)
Dollar Amounts in Thousands RCON RCON RCON
<S> <C>
Deposits of:
1. Individuals, partnerships,
and corporations 2201 2,943,250 2240 2,647,212 2346 14,125,761 1.
2. U.S. Government 2202 9,459 2280 2,877 2520 1,660 2.
3. States and political subdivisions
in the U.S. 2203 157,915 2290 124,702 2530 14,275 3.
4. Commercial banks in the U.S. 2206 103,300 2310 103,300 2550 0 4.
5. Other depository institutions
in the U.S. 2207 43,760 2312 43,760 2349 0 5.
6. Banks in foreign countries 2213 2,556 2320 2,556 2236 0 6.
7. Foreign governments and
official institutions
(including foreign central banks) 2216 0 2300 0 2377 0 7.
8. Certified and official checks 2330 59,078 2330 59,078 8.
9. Total (sum of items 1 through 8)
(sum of columns A and C must
equal Schedule RC, item 13.a) 2215 3,319,318 2210 2,983,485 2385 14,141,696 9.
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
Memoranda
Dollar Amounts in Thousands RCON
1. Selected components of total deposits (i.e., sum of item 9, columns A and C):
a. Total Individual Retirement Accounts (IRAs) and Keogh Plan accounts 6835 1,043,210 M.1.a.
b. Total brokered deposits 2365 100,000 M.1.b.
c. Fully insured brokered deposits (included in Memorandum item 1.b above):
(1) Issued in denominations of less than $100,000 2343 0 M.1.c.(1)
(2) Issued either in denominations of $100,000 or in denominations greater than
$100,000 and participated out by the broker in shares of $100,000 or less 2344 0 M.1.c.(2)
d. Maturity data for brokered deposits:
(1) Brokered deposits issued in denominations of less than $100,000 with
a remaining maturity of one year or less (included in Memorandum item
1.c.(1) above) A243 0 M.1.d.(1)
(2) Brokered deposits issued in denominations of $100,000 or more with a
remaining maturity of one year or less (included in Memorandum
item 1.b above) A244 100,000 M.1.d.(2)
e. Preferred deposits (uninsured deposits of states and political subdivisions
in the U.S. reported in item 3 above which are secured or collateralized as
required under state law) (to be completed for the December report only) 5590 N/A M.1.e.
2. Components of total nontransaction accounts (sum of Memorandum items 2.a
through 2.d must equal item 9, column C above):
a. Savings deposits:
(1) Money market deposit accounts (MMDAs) 6810 8,185,874 M.2.a.(1)
(2) Other savings deposits (excludes MMDAs) 0352 1,215,750 M.2.a.(2)
b. Total time deposits of less than $100,000 6648 3,410,717 M.2.b.
c. Total time deposits of $100,000 or more 2604 1,329,355 M.2.c.
3. All NOW accounts (included in column A above) 2398 335,833 M.3.
4. Not applicable
</TABLE>
19
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-10
Schedule RC-E--Continued
Part I. Continued
Memoranda (continued)
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
<S> <C>
5. Maturity and repricing data for time deposits of less than $100,000:
a. Time deposits of less than $100,000 with a remaining maturity or repricing frequency
of: (1) (2)
(1) Three months or less A579 890,912 M.5.a.(1)
(2) Over three months through 12 months A580 1,703,144 M.5.a.(2)
(3) Over one year through three years A581 659,489 M.5.a.(3)
(4) Over three years A582 157,172 M.5.a.(4)
b. Fixed rate AND floating rate time deposits of less than $100,000 with a REMAINING
MATURITY of one year or less (included in Memorandum items 5.a.(1) through
5.a.(4) above) A241 2,594,053 M.5.b.
6. Maturity and repricing data for time deposits of $100,000 or more:
a. Time deposits of $100,000 or more with a remaining maturity or repricing frequency
of: (1) (3)
(1) Three months or less A584 811,346 M.6.a.(1)
(2) Over three months through 12 months A585 454,522 M.6.a.(2)
(3) Over one year through three years A586 55,853 M.6.a.(3)
(4) Over three years A587 7,634 M.6.a.(4)
b. Fixed rate AND floating rate time deposits of $100,000 or more with a REMAINING
MATURITY of one year or less (included in Memorandum items 6.a.(1) through
6.a.(4) above) A242 1,265,868 M.6.b.
</TABLE>
__________
(1) Report fixed rate time deposits by remaining maturity and floating rate time
deposits by repricing frequency.
(2) Sum of Memorandum items 5.a.(1) through 5.a.(4) must equal Schedule RC-E,
Memorandum item 2.b above.
(3) Sum of Memorandum items 6.a.(1) through 6.a.(4) must equal Schedule RC-E,
Memorandum item 2.c above.
20
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-11
Schedule RC-E--Continued
Part II. Deposits in Foreign Offices (including Edge and Agreement subsidiaries
and IBFs)
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCFN
<S> <C>
Deposits of:
1. Individuals, partnerships, and corporations 2621 27,900 1.
2. U.S. banks (including IBFs and foreign branches of U.S. banks) 2623 0 2.
3. Foreign banks (including U.S. branches and agencies of foreign banks,
including their IBFs) 2625 0 3.
4. Foreign governments and official institutions (including foreign central
banks) 2650 0 4.
5. Certified and official checks 2330 0 5.
6. All other deposits 2668 0 6.
7. Total (sum of items 1 through 6) (must equal Schedule RC, item 13.b) 2200 27,900 7.
</TABLE>
<TABLE>
<CAPTION>
Memorandum
Dollar Amounts in Thousands RCFN
<S> <C>
1. Time deposits with a remaining maturity of one year or less (included in
Part II, item 7 above) A245 27,900 M.1.
</TABLE>
Schedule RC-F--Other Assets
<TABLE>
<CAPTION>
C430
Dollar Amounts in Thousands
<S> <C>
1. Income earned, not collected on loans RCFD 2164 130,129 1.
2. Net deferred tax assets (1) RCFD 2148 143,873 2.
3. Interest-only strips receivable (not in the form of a security)
(2) on:
a. Mortgage loans RCFD A519 0 3.a.
b. Other financial assets RCFD A520 0 3.b.
4. Other (itemize and describe amounts that exceed 25% of this item) RCFD 2168 362,535 4.
a. TEXT 3549 RCFD 3549 0 4.a.
b. TEXT 3550 RCFD 3550 0 4.b.
c. TEXT 3551 RCFD 3551 0 4.c.
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 11) RCFD 2160 636,537 5.
</TABLE>
<TABLE>
<CAPTION>
Memorandum
Dollar Amounts in Thousands
<S> <C>
1. Deferred tax assets disallowed for regulatory capital purposes RCFD 5610 0 M.1.
</TABLE>
Schedule RC-G--Other Liabilities
<TABLE>
<CAPTION>
C435
Dollar Amounts in Thousands
<S> <C>
1. a. Interest accrued and unpaid on deposits in domestic offices (3) RCON 3645 28,242 1.a.
b. Other expenses accrued and unpaid (includes accrued income taxes payable) RCFD 3646 224,333 1.b.
2. Net deferred tax liabilities (1) RCFD 3049 0 2.
3. Minority interest in consolidated subsidiaries RCFD 3000 44,943 3.
4. Other (itemize and describe amounts that exceed 25% of this item) RCFD 2938 138,069 4.
a. TEXT 3552 RCFD 3552 0 4.a.
b. TEXT 3553 RCFD 3553 0 4.b.
c. TEXT 3554 RCFD 3554 0 4.c.
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 20) RCFD 2930 435,587 5.
</TABLE>
__________
(1) See discussion of deferred income taxes in Glossary entry on "income taxes."
(2) Report interest-only strips receivable in the form of a security as
available-for-sale securities in Schedule RC, item 2.b, or as trading
assets in Schedule RC, item 5, as appropriate.
(3) For savings banks, include "dividends" accrued and unpaid on deposits.
21
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-12
Schedule RC-H--Selected Balance Sheet Items for Domestic Offices
<TABLE>
<CAPTION>
C440
Domestic Offices
Dollar Amounts in Thousands RCON
<S> <C>
1. Customers' liability to this bank on acceptances outstanding 2155 6,105 1.
2. Bank's liability on acceptances executed and outstanding 2920 6,105 2.
3. Federal funds sold and securities purchased under agreements to resell 1350 15,877 3.
4. Federal funds purchased and securities sold under agreements to repurchase 2800 4,346,259 4.
5. Other borrowed money 3190 258,752 5.
EITHER
6. Net due from own foreign offices, Edge and Agreement subsidiaries, and IBFs 2163 0 6.
OR
7. Net due to own foreign offices, Edge and Agreement subsidiaries, and IBFs 2941 11,382 7.
8. Total assets (excludes net due from foreign offices, Edge and Agreement
subsidiaries, and IBFs) 2192 25,642,735 8.
9. Total liabilities (excludes net due to foreign offices, Edge and Agreement
subsidiaries, and IBFs) 3129 23,617,221 9.
</TABLE>
In Items 10-17, report the amortized (historical) cost of both
held-to-maturity and available-for-sale securities in domestic offices.
<TABLE>
<CAPTION>
RCON
<S> <C>
10. U.S. Treasury securities 1039 93,965 10.
11. U.S. Government agency obligations (exclude mortgage-backed securities) 1041 272,982 11.
12. Securities issued by states and political subdivisions in the U.S. 1042 87,669 12.
13. Mortgage-backed securities (MBS):
a. Pass-through securities:
(1) Issued or guaranteed by FNMA, FHLMC, or GNMA 1043 2,515,997 13.a.(1)
(2) Other pass-through securities 1044 0 13.a.(2)
b. Other mortgage-backed securities (include CMOs, REMICs, and stripped MBS):
(1) Issued or guaranteed by FNMA, FHLMC, or GNMA 1209 383,354 13.b.(1)
(2) All other mortgage-backed securities 1280 50 13.b.(2)
14. Other domestic debt securities 1281 1,480,413 14.
15. Foreign debt securities 1282 2,250 15.
16. Equity securities:
a. Investments in mutual funds and other
equity securities with readily determinable fair values A510 10,838 16.a.
b. All other equity securities 1752 137,904 16.b.
17. Total amortized (historical) cost of both held-to-maturity and
available-for-sale securities (sum of items 10 through 16) 1374 4,985,422 17.
</TABLE>
<TABLE>
<CAPTION>
Memorandum (to be completed only by banks with IBFs and other "foreign" offices)
Dollar Amounts in Thousands RCON
<S> <C>
EITHER
1. Net due from the IBF of the domestic offices of the reporting bank 3051 0 M.1.
OR
2. Net due to the IBF of the domestic offices of the reporting bank 3059 0 M.2.
</TABLE>
22
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-13
Schedule RC-I--Selected Assets and Liabilities of IBFs
To be completed only by banks with IBFs and other "foreign" offices.
<TABLE>
<CAPTION>
C445
Dollar Amounts in Thousands RCFN
<S> <C>
1. Total IBF assets of the consolidated bank (component of Schedule RC,
item 12) 2133 0 1.
2. Total IBF loans and lease financing receivables (component of Schedule RC-C,
part I, item 12, column A) 2076 0 2.
3. IBF commercial and industrial loans (component of Schedule RC-C, part I,
item 4, column A) 2077 0 3.
4. Total IBF liabilities (component of Schedule RC, item 21) 2898 0 4.
5. IBF deposit liabilities due to banks, including other IBFs (component of
Schedule RC-E, part II, items 2 and 3) 2379 0 5.
6. Other IBF deposit liabilities (component of Schedule RC-E, part II, items 1,
4, 5, and 6) 2381 0 6.
</TABLE>
Schedule RC-K--Quarterly Averages (1)
<TABLE>
<CAPTION>
C455
Dollar Amounts in Thousands
<S> <C>
ASSETS
1. Interest-bearing balances due from depository institutions RCFD 3381 1,754 1.
2. U.S. Treasury securities and U.S. Government agency obligations(2) RCFD 3382 3,265,250 2.
(including mortgage-backed securities issued or guaranteed by
FNMA, FHLMC, or GNMA)
3. Securities issued by states and political subdivisions in the U.S.(2) RCFD 3383 83,201 3.
4. a. Other debt securities(2) RCFD 3647 1,453,474 4.a.
(including mortgage-backed securities not issued or guaranteed by
FNMA, FHLMC, or GNMA)
b. Equity securities(3) (includes investments in mutual funds and Federal
Reserve stock) RCFD 3648 157,147 4.b.
5. Federal funds sold and securities purchased under agreements to resell RCFD 3365 22,732 5.
6. Loans:
a. Loans in domestic offices:
(1) Total loans RCON 3360 18,314,594 6.a.(1)
(2) Loans secured by real estate RCON 3385 9,403,619 6.a.(2)
(3) Loans to finance agricultural production and other loans to farmers RCON 3386 2,765 6.a.(3)
(4) Commercial and industrial loans RCON 3387 3,553,198 6.a.(4)
(5) Loans to individuals for household, family, and other personal expenditures RCON 3388 3,717,463 6.a.(5)
b. Total loans in foreign offices, Edge and Agreement subsidiaries, and IBFs RCFN 3360 0 6.b.
7. Trading assets RCFD 3401 0 7.
8. Lease financing receivables (net of unearned income) RCFD 3484 782,255 8.
9. Total assets(4) RCFD 3368 26,058,198 9.
LIABILITIES
10. Interest-bearing transaction accounts in domestic offices (NOW accounts,
ATS accounts, and telephone and preauthorized transfer accounts) (exclude
demand deposits) RCON 3485 234,257 10.
11. Nontransaction accounts in domestic offices:
a. Money market deposit accounts (MMDAs) RCON 3486 7,912,071 11.a.
b. Other savings deposits RCON 3487 1,256,023 11.b.
c. Time deposits of $100,000 or more RCON A514 1,473,621 11.c.
d. Time deposits of less than $100,000 RCON A529 3,395,471 11.d.
12. Interest-bearing deposits in foreign offices, Edge and Agreement
subsidiaries, and IBFs RCFN 3404 12,702 12.
13. Federal funds purchased and securities sold under agreements to repurchase RCFD 3353 4,415,648 13.
14. Other borrowed money (includes mortgage indebtedness and obligations under
capitalized leases) RCFD 3355 1,378,939 14.
</TABLE>
__________
(1) For all items, banks have the option of reporting either (1) an
average of daily figures for the quarter, or (2) an average of weekly
figures (i.e., the Wednesday of each week of the quarter).
(2) Quarterly averages for all debt securities should be based on
amortized cost.
(3) Quarterly averages for all equity securities should be based on
historical cost.
(4) The quarterly average for total assets should reflect all debt
securities (not held for trading) at amortized cost, equity securities
with readily determinable fair values at the lower of cost or fair
value, and equity securities without readily determinable fair values
at historical cost.
23
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-14
Schedule RC-L--Off-Balance Sheet Items
Please read carefully the instructions for the preparation of Schedule
RC-L. Some of the amounts reported in Schedule RC-L are regarded as
volume indicators and not necessarily as measures of risk.
<TABLE>
<CAPTION>
C460
Dollar Amounts in Thousands RCFD
<S> <C>
1. Unused commitments:
a. Revolving, open-end lines secured by 1-4 family residential properties,
e.g., home equity lines 3814 1,290,610 1.a.
b. Credit card lines 3815 1,358,261 1.b.
c. Commercial real estate, construction, and land development:
(1) Commitments to fund loans secured by real estate 3816 342,752 1.c.(1)
(2) Commitments to fund loans not secured by real estate 6550 0 1.c.(2)
d. Securities underwriting 3817 0 1.d.
e. Other unused commitments 3818 7,096,095 1.e.
2. Financial standby letters of credit and foreign office guarantees 3819 308,624 2.
a. Amount of financial standby letters of credit conveyed to others RCFD 3820 3,148 2.a.
3. Performance standby letters of credit and foreign office guarantees 3821 109,741 3.
a. Amount of performance standby letters of credit conveyed to others RCFD 3822 269 3.a.
4. Commercial and similar letters of credit 3411 6,214 4.
5. Participations in acceptances (as described in the instructions) conveyed to
others by the reporting bank 3428 0 5.
6. Participations in acceptances (as described in the instructions) acquired by
the reporting (nonaccepting) bank 3429 0 6.
7. Securities borrowed 3432 0 7.
8. Securities lent (including customers' securities lent where the customer is
indemnified against loss by the reporting bank) 3433 0 8.
9. Financial assets transferred with recourse that have been
treated as sold for Call Report purposes:
a. First lien 1-to-4 family residential mortgage loans:
(1) Outstanding principal balance of mortgages transferred as of the report
date A521 177,656 9.a.(1)
(2) Amount of recourse exposure on these mortgages as of the report date A522 70,480 9.a.(2)
b. Other financial assets (excluding small business obligations reported in item
9.c):
(1) Outstanding principal balance of assets transferred as of the report
date A523 152,737 9.b.(1)
(2) Amount of recourse exposure on these assets as of the report date A524 152,737 9.b.(2)
c. Small business obligations transferred with recourse under Section 208 of the
Riegle Community Development and Regulatory Improvement Act of 1994:
(1) Outstanding principal balance of small business obligations transferred
as of the report date A249 0 9.c.(1)
(2) Amount of retained recourse on these obligations as of the report date A250 0 9.c.(2)
10. Notional amount of credit derivatives:
a. Credit derivatives on which the reporting bank is the guarantor A534 0 10.a.
b. Credit derivatives on which the reporting bank is the beneficiary A535 0 10.b.
11. Spot foreign exchange contracts 8765 0 11.
12. All other off-balance sheet liabilities (exclude off-balance sheet
derivatives) (itemize and describe each component of this item over 25% of
Schedule RC, item 28, "Total equity capital") 3430 1,916,951 12.
a. TEXT 3555 Mortgage Servicing with Recourse RCFD 3555 1,916,951 12.a.
b. TEXT 3556 RCFD 3556 0 12.b.
c. TEXT 3557 RCFD 3557 0 12.c.
d. TEXT 3558 RCFD 3558 0 12.d.
</TABLE>
24
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-15
Schedule RC-L--Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCFD
<S> <C>
13. All other off-balance sheet assets (exclude off-balance sheet derivatives)
(itemize and describe each component of this item over 25% of Schedule RC,
item 28, "Total equity capital") 5591 0 13.
a. TEXT 5592 RCFD 5592 0 13.a.
b. TEXT 5593 RCFD 5593 0 13.b.
c. TEXT 5594 RCFD 5594 0 13.c.
d. TEXT 5595 RCFD 5595 0 13.d.
</TABLE>
<TABLE>
<CAPTION>
C461
(Column A) (Column B) (Column C) (Column D)
Dollar Amounts in Thousands Interest Rate Foreign Exchange Equity Derivative Commodity and
Off-balance Sheet Derivatives Contracts Contracts Contracts Other Contracts
Position Indicators
<S> <C>
14. Gross amounts (e.g., notional amounts)
(for each column, sum of items 14.a
through 14.e must equal sum of items
15, 16.a, and 16.b):
a. Future contracts RCFD 8693 0 RCFD 8694 0 RCFD 8695 0 RCFD 8696 0 14.a.
b. Forward contracts RCFD 8697 1,524,266 RCFD 8698 0 RCFD 8699 0 RCFD 8700 0 14.b.
c. Exchange-traded option contracts:
(1) Written options RCFD 8701 0 RCFD 8702 0 RCFD 8703 0 RCFD 8704 0 14.c.(1)
(2) Purchased options RCFD 8705 0 RCFD 8706 0 RCFD 8707 0 RCFD 8708 0 14.c.(2)
d. Over-the-counter option contracts:
(1) Written options RCFD 8709 0 RCFD 8710 0 RCFD 8711 0 RCFD 8712 0 14.d.(1)
(2) Purchased options RCFD 8713 3,850,000 RCFD 8714 0 RCFD 8715 0 RCFD 8716 0 14.d.(2)
e. Swaps RCFD 3450 1,425,000 RCFD 3826 0 RCFD 8719 0 RCFD 8720 0 14.e.
15. Total gross notional amount of
derivative contracts held for trading RCFD A126 0 RCFD A127 0 RCFD 8723 0 RCFD 8724 0 15
16. Gross notional amount of derivative
contracts held for purposes other
than trading:
a. Contracts marked to market RCFD 8725 0 RCFD 8726 0 RCFD 8727 0 RCFD 8728 0 16.a.
b. Contracts not marked to market RCFD 8729 6,799,266 RCFD 8730 0 RCFD 8731 0 RCFD 8732 0 16.b.
c. Interest rate swaps where the bank
has agreed to pay a fixed rate RCFD A589 0 16.c.
</TABLE>
25
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-16
Schedule RC-L--Continued
<TABLE>
<CAPTION>
C462
(Column A) (Column B) (Column C) (Column D)
Dollar Amounts in Thousands Interest Rate Foreign Exchange Equity Derivative Commodity and
Off-balance Sheet Derivatives Contracts Contracts Contracts Other Contracts
Position Indicators RCFD RCFD RCFD RCFD
<S> <C>
17. Gross fair values of
derivative contracts:
a. Contracts held for trading:
(1) Gross positive fair value 8733 0 8734 0 8735 0 8736 0 17.a.(1)
(2) Gross negative fair value 8737 0 8738 0 8739 0 8740 0 17.a.(2)
b. Contracts held for purposes
other than trading that
are marked to market:
(1) Gross positive fair value 8741 0 8742 0 8743 0 8744 0 17.b.(1)
(2) Gross negative fair value 8745 0 8746 0 8747 0 8748 0 17.b.(2)
c. Contracts held for purposes
other than trading that are
not marked to market:
(1) Gross positive fair value 8749 18,212 8750 0 8751 0 8752 0 17.c.(1)
(2) Gross negative fair value 8753 252 8754 0 8755 0 8756 0 17.c.(2)
</TABLE>
<TABLE>
<CAPTION>
Memoranda Dollar Amounts in Thousands RCFD
<S> <C>
1.-2. Not applicable
3. Unused commitments with an original maturity exceeding one year that are
reported in Schedule RC-L, items 1.a through 1.e, above (report only the
unused portions of commitments that are fee paid or otherwise legally
binding) 3833 5,454,218 M.3.
a. Participations in commitments with an original maturity
exceeding one year conveyed to others RCFD 3834 0 M.3.a.
4. To be completed only by banks with $1 billion or more in total assets:
Standby letters of credit and foreign office guarantees (both financial and
performance) issued to non-U.S. addressees (domicile) included in Schedule
RC-L, items 2 and 3, above 3377 0 M.4.
5. Loans to individuals for household, family, and other personal
expenditures that have been securitized and sold (with servicing retained),
amounts outstanding by type of loan:
a. Loans to purchase private passenger automobiles (to be completed
for the September report only) 2741 0 M.5.a.
b. Credit cards and related plans (TO BE COMPLETED QUARTERLY) 2742 0 M.5.b.
c. All other consumer credit (including mobile home loans)
(to be completed for the September report only) 2743 0 M.5.c.
</TABLE>
26
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-17
Schedule RC-M--Memoranda
<TABLE>
<CAPTION>
C465
Dollar Amounts in Thousands RCFD
<S> <C>
1. Extensions of credit by the reporting bank to its executive officers,
directors, principal shareholders, and their related interests as of the
report date:
a. Aggregate amount of all extensions of credit to all executive officers,
directors, principal shareholders, and their related interests 6164 12,799 1.a.
b. Number of executive officers, directors, and principal shareholders to whom
the amount of all extensions of credit by the reporting bank (including
extensions of credit to related interests) equals or exceeds the lesser of
$500,000 or 5 percent of total capital as defined for this Number
purpose in agency regulations RCFD 6165 5 1.b.
2. Federal funds sold and securities purchased under agreements to resell with
U.S. branches and agencies of foreign banks(1) (included in Schedule RC,
item 3) 3405 0 2.
3. Not applicable.
4. Outstanding principal balance of 1-4 family residential mortgage loans
serviced for others (include both retained servicing and purchased
servicing):
a. Mortgages serviced under a GNMA contract 5500 1,859,590 4.a.
b. Mortgages serviced under a FHLMC contract:
(1) Serviced with recourse to servicer 5501 6,909 4.b.(1)
(2) Serviced without recourse to servicer 5502 3,038,346 4.b.(2)
c. Mortgages serviced under a FNMA contract:
(1) Serviced under a regular option contract 5503 50,452 4.c.(1)
(2) Serviced under a special option contract 5504 5,902,196 4.c.(2)
d. Mortgages serviced under other servicing contracts 5505 7,221,838 4.d.
5. To be completed only by banks with $1 billion or more in total assets:
Customers' liability to this bank on acceptances outstanding (sum of items
5.a and 5.b must equal Schedule RC, item 9):
a. U.S. addressees (domicile) 2103 6,105 5.a.
b. Non-U.S. addressees (domicile) 2104 0 5.b.
6. Intangible assets:
a. Mortgage servicing assets 3164 160,228 6.a.
(1) Estimated fair value of mortgage servicing assets A590 209,528 6.a.(1)
b. Other identifiable intangible assets:
(1) Purchased credit card relationships and nonmortgage servicing assets 5506 0 6.b.(1)
(2) All other identifiable intangible assets 5507 5,751 6.b.(2)
c. Goodwill 3163 178,171 6.c.
d. Total (sum of items 6.a, 6.b.(1), 6.b.(2), and 6.c)
(must equal Schedule RC, item 10) 2143 344,150 6.d.
e. Amount of intangible assets (included in item 6.b.(2) above) that have been
grandfathered or are otherwise qualifying for regulatory capital purposes 6442 0 6.e.
7. Mandatory convertible debt, net of common or perpetual preferred stock
dedicated to redeem the debt 3295 0 7.
</TABLE>
__________
(1) Do not report federal funds sold and securities purchased under agreements
to resell with other commercial banks in the U.S. in this item.
27
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-18
Schedule RC-M--Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
<S> <C>
8. a. Other real estate owned:
(1) Direct and indirect investments in real estate ventures RCFD 5372 0 8.a.(1)
(2) All other real estate owned:
(a) Construction and land development in domestic offices RCON 5508 3,253 8.a.(2)(a)
(b) Farmland in domestic offices RCON 5509 0 8.a.(2)(b)
(c) 1-4 family residential properties in domestic offices RCON 5510 7,403 8.a.(2)(c)
(d) Multifamily (5 or more) residential properties in domestic offices RCON 5511 0 8.a.(2)(d)
(e) Nonfarm nonresidential properties in domestic offices RCON 5512 3,930 8.a.(2)(e)
(f) In foreign offices RCFN 5513 0 8.a.(2)(f)
(3) Total (sum of items 8.a.(1) and 8.a.(2)) (must equal Schedule RC, item 7) RCFD 2150 14,586 8.a.(3)
b. Investments in unconsolidated subsidiaries and associated companies:
(1) Direct and indirect investments in real estate ventures RCFD 5374 0 8.b.(1)
(2) All other investments in unconsolidated subsidiaries and associated
companies RCFD 5375 15,080 8.b.(2)
(3) Total (sum of items 8.b.(1) and 8.b.(2)) (must equal Schedule RC, item 8) RCFD 2130 15,080 8.b.(3)
9. Noncumulative perpetual preferred stock and related surplus included in
Schedule RC, item 23, "Perpetual preferred stock and related surplus" RCFD 3778 0 9.
10. Mutual fund and annuity sales in domestic offices during the quarter
(include proprietary, private label, and third party products):
a. Money market funds RCON 6441 339,872 10.a.
b. Equity securities funds RCON 8427 31,368 10.b.
c. Debt securities funds RCON 8428 7,965 10.c.
d. Other mutual funds RCON 8429 38,180 10.d.
e. Annuities RCON 8430 77,229 10.e.
f. Sales of proprietary mutual funds and annuities (included in items 10.a
through 10.e above) RCON 8784 228,588 10.f.
11. Net unamortized realized deferred gains (losses) on off-balance sheet derivative
contracts included in assets and liabilities reported in Schedule RC RCFD A525 2,161 11.
12. Amount of assets netted against nondeposit liabilities and deposits in foreign
offices (other than insured branches in Puerto Rico and U.S. territories and
possessions) on the balance sheet (Schedule RC) in accordance with generally
accepted accounting principles (1) RCFD A526 0 12.
13. Outstanding principal balance of loans other than 1-4 family residential mortgage
loans that are serviced for others (to be completed if this balance is more than
$10 million and exceeds ten percent of total assets) RCFD A591 0 13.
</TABLE>
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
Memorandum RCFD
<S> <C>
1. Reciprocal holdings of banking organizations' capital instruments
(to be completed for the December report only) 3836 N/A M.1.
</TABLE>
- -------------
(1) Exclude netted on-balance sheet amounts associated with off-balance sheet
derivative contracts, deferred tax assets netted against deferred tax
liabilities, and assets netted in accounting for pensions.
28
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-19
Schedule RC-N--Past Due and Nonaccrual Loans, Leases, and Other Assets
The FFIEC regards the information reported in all of Memorandum item 1, in
items 1 through 10, column A, and in Memorandum items 2 through 4, column A,
as confidential.
<TABLE>
<CAPTION>
C470
(Column A) (Column B) (Column C)
Past due Past due 90 Nonaccrual
30 through 89 days or more
days and still and still
accruing accruing
Dollar Amounts in Thousands RCFD RCFD RCFD
<S> <C>
1. Loans secured by real estate:
a. To U.S. addressees (domicile) 1245 79,725 1246 7,703 1247 50,085 1.a.
b. To non-U.S. addressees (domicile) 1248 0 1249 0 1250 0 1.b.
2. Loans to depository institutions and
acceptances of other banks:
a. To U.S. banks and other U.S. depository
institutions 5377 0 5378 0 5379 0 2.a.
b. To foreign banks 5380 0 5381 0 5382 0 2.b.
3. Loans to finance agricultural production
and other loans to farmers 1594 0 1597 0 1583 0 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile) 1251 34,194 1252 727 1253 16,649 4.a.
b. To non-U.S. addressees (domicile) 1254 0 1255 0 1256 0 4.b.
5. Loans to individuals for household, family,
and other personal expenditures:
a. Credit cards and related plans 5383 8,769 5384 4,453 5385 0 5.a.
b. Other (includes single payment,
installment, and all student loans) 5386 104,319 5387 65,323 5388 1,426 5.b.
6. Loans to foreign governments and official
institutions 5389 0 5390 0 5391 0 6.
7. All other loans 5459 21 5460 0 5461 0 7.
8. Lease financing receivables:
a. Of U.S. addressees (domicile) 1257 0 1258 0 1259 0 8.a.
b. Of non-U.S. addressees (domicile) 1271 0 1272 0 1791 0 8.b.
9. Debt securities and other assets (exclude
other real estate owned and other
repossessed assets) 3505 0 3506 0 3507 0 9.
</TABLE>
Amounts reported in items 1 through 8 above include guaranteed and unguaranteed
portions of past due and nonaccrual loans and leases. Report in item 10 below
certain guaranteed loans and leases that have already been included in the
amounts reported in items 1 through 8.
<TABLE>
<CAPTION>
RCFD RCFD RCFD
<S> <C>
10. Loans and leases reported in items 1
through 8 above which are wholly or
partially guaranteed by the U.S.
Government. 5612 31,306 5613 17,106 5614 0 10.
a. Guaranteed portion of loans and leases
included in item 10 above. 5615 25,045 5616 13,685 5617 0 10.a.
</TABLE>
29
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4118
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-20
Schedule RC-N--Continued
<TABLE>
<CAPTION>
C473
(Column A) (Column B) (Column C)
Past due Past due 90 Nonaccrual
30 through 89 days or more
days and still and still
accruing accruing
Memoranda
Dollar Amounts in Thousands RCFD RCFD RCFD
<S> <C>
1. Restructured loans and leases included
in Schedule RC-N, items 1 through 8,
above (and not reported in Schedule RC-C,
part I, Memorandum item 2) 1658 0 1659 0 1661 1,290 M.1.
2. Loans to finance commercial real estate,
construction, and land development
activities (not secured by real estate)
included in Schedule RC-N, items 4
and 7, above 6558 0 6559 0 6560 0 M.2.
<CAPTION>
RCON RCON RCON
<S> <C>
3. Loans secured by real estate in domestic
offices (included in Schedule RC-N,
item 1, above):
a. Construction and land development 2759 1,751 2769 0 3492 6,050 M.3.a.
b. Secured by farmland 3493 0 3494 0 3495 339 M.3.b.
c. Secured by 1-4 family residential
properties:
(1) Revolving, open-end loans secured by
1-4 family residential properties and
extended under lines of credit 5398 10,150 5399 2,011 5400 133 M.3.c.(1)
(2) All other loans secured by 1-4 family
residential properties 5401 63,646 5402 4,132 5403 29,716 M.3.c.(2)
d. Secured by multifamily (5 or more)
residential properties 3499 0 3500 0 3501 1,376 M.3.d.
e. Secured by nonfarm nonresidential
properties 3502 4,178 3503 1,296 3504 12,471 M.3.e.
</TABLE>
<TABLE>
<CAPTION>
(Column A) (Column B)
Past due 30 Past due 90
through 89 days days or more
RCFD RCFD
<S> <C>
4. Interest rate, foreign exchange rate, and
other commodity and equity contracts:
a. Book value of amounts carried as assets 3522 0 3528 0 M.4.a.
b. Replacement cost of contracts with a
positive replacement cost 3529 0 3530 0 M.4.b.
</TABLE>
Person to whom questions about the Reports of Condition and Income should be
directed:
C477
<TABLE>
<S> <C>
Mike Kearney, Vice President (404) 724-3835
- -------------------------------------- -------------------------------------------
Name and Title (TEXT 8901) Area code/phone number/extension (TEXT 8902)
(404) 827-6501
-------------------------------------------
FAX: Area code/phone number (TEXT 9116)
</TABLE>
30
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-21
Schedule RC-O--Other Data for Deposit Insurance and FICO Assessments
<TABLE>
<CAPTION>
C475
Dollar Amounts in Thousands RCON
<S> <C>
1. Unposted debits (see instructions):
a. Actual amount of all unposted debits 0030 0 1.a.
OR
b. Separate amount of unposted debits:
(1) Actual amount of unposted debits to demand deposits 0031 0 1.b.(1)
(2) Actual amount of unposted debits to time and savings deposits (1) 0032 0 1.b.(2)
2. Unposted credits (see instructions):
a. Actual amount of all unposted credits 3510 0 2.a.
OR
b. Separate amount of unposted credits:
(1) Actual amount of unposted credits to demand deposits 3512 0 2.b.(1)
(2) Actual amount of unposted credits to time and savings deposits (1) 3514 0 2.b.(2)
3. Uninvested trust funds (cash) held in bank's own trust department (not
included in total deposits in domestic offices) 3520 0 3.
4. Deposits of consolidated subsidiaries in domestic offices and in insured
branches in Puerto Rico and U.S. territories and possessions (not included
in total deposits):
a. Demand deposits of consolidated subsidiaries 2211 9,381 4.a.
b. Time and savings deposits (1) of consolidated subsidiaries 2351 0 4.b.
c. Interest accrued and unpaid on deposits of consolidated subsidiaries 5514 0 4.c.
5. Deposits in insured branches in Puerto Rico and U.S. territories and
possessions:
a. Demand deposits in insured branches (included in Schedule RC-E, Part II) 2229 0 5.a.
b. Time and savings deposits (1) in insured branches (included in Schedule
RC-E, Part II) 2383 0 5.b.
c. Interest accrued and unpaid on deposits in insured branches (included in
Schedule RC-G, item 1.b) 5515 0 5.c.
6. Reserve balances actually passed through to the Federal Reserve by the
reporting bank on behalf of its respondent depository institutions that are
also reflected as deposit liabilities of the reporting bank:
a. Amount reflected in demand deposits (included in Schedule RC-E, Part I, item 4 or 5,
column B) 2314 0 6.a.
b. Amount reflected in time and savings deposits (1) (included in Schedule
RC-E, Part I, item 4 or 5, column A or C, but not column B) 2315 0 6.b.
7. Unamortized premiums and discounts on time and savings deposits:(1)
a. Unamortized premiums 5516 0 7.a.
b. Unamortized discounts 5517 0 7.b.
8. To be completed by banks with "Oakar deposits."
a. Deposits purchased or acquired from other FDIC-insured institutions during
the quarter (exclude deposits purchased or acquired from foreign offices other
than insured branches in Puerto Rico and U.S. territories and possessions):
(1) Total deposits purchased or acquired from other FDIC-insured institutions
during the quarter A531 0 8.a.(1)
(2) Amount of purchased or acquired deposits reported in item 8.a.(1) above
attributable to a secondary fund (i.e., BIF members report deposits
attributable to SAIF; SAIF members report deposits attributable to BIF) A532 0 8.a.(2)
b. Total deposits sold or transferred to other FDIC-insured institutions during
the quarter (exclude sales or transfers by the reporting bank of deposits in
foreign offices other than insured branches in Puerto Rico and U.S. territories
and possessions) A533 0 8.b.
</TABLE>
__________
(1) For FDIC insurance and FICO assessment purposes, "time and savings deposits"
consists of nontransaction accounts and all transaction accounts other than
demand deposits.
31
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-22
Schedule RC-O--Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCON
<S> <C>
9. Deposits in lifeline accounts 5596 9.
10. Benefit-responsive "Depository Institution Investment Contracts" (included
in total deposits in domestic offices) 8432 0 10.
11. Adjustments to demand deposits in domestic offices and in insured branches in
Puerto Rico and U.S. territories and possessions reported in Schedule RC-E for
certain reciprocal demand balances:
a. Amount by which demand deposits would be reduced if the reporting bank's
reciprocal demand balances with the domestic offices of U.S. banks and
savings associations and insured branches in Puerto Rico and U.S. territories
and possessions that were reported on a gross basis in Schedule RC-E had
been reported on a net basis 8785 0 11.a.
b. Amount by which demand deposits would be increased if the reporting bank's
reciprocal demand balances with foreign banks and foreign offices of other U.S.
banks (other than insured branches in Puerto Rico and U.S. territories and possessions)
that were reported on a net basis in Schedule RC-E had been reported on a gross basis A181 0 11.b.
c. Amount by which demand deposits would be reduced if cash items in process of
collection were included in the calculation of the reporting bank's net reciprocal
demand balances with the domestic offices of U.S. banks and savings associations and
insured branches in Puerto Rico and U.S. territories and possessions in Schedule RC-E A182 0 11.c.
12. Amount of assets netted against deposit liabilities in domestic offices and in
insured branches in Puerto Rico and U.S. territories and possessions on the balance
sheet (Schedule RC) in accordance with generally accepted accounting principles
(exclude amounts related to reciprocal demand balances):
a. Amount of assets netted against demand deposits A527 0 12.a.
b. Amount of assets netted against time and savings deposits A528 0 12.b.
</TABLE>
Memoranda (to be completed each quarter except as noted)
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCON
<S> <C>
1. Total deposits in domestic offices of the bank (sum of Memorandum items 1.a.
(1) and 1.b.(1) must equal schedule RC, item 13.a):
a. Deposit accounts of $100,000 or less:
(1) Amount of deposit accounts of $100,000 or less 2702 11,422,944 M.1.a.(1)
(2) Number of deposit accounts of $100,000 or less
(to be completed for the June report only) Number
RCON 3779 N/A M.1.a.(2)
b. Deposit accounts of more than $100,000:
(1) Amount of deposit accounts of more than $100,000 2710 6,038,070 M.1.b.(1)
Number
(2) Number of deposit accounts of more than $100,000 RCON 2722 21,720 M.1.b.(2)
2. Estimated amount of uninsured deposits in domestic offices of the bank:
a. An estimate of your bank's uninsured deposits can be determined by
multiplying the number of deposit accounts of more than $100,000 reported
in Memorandum item 1.b.(2) above by $100,000 and subtracting the result from
the amount of deposit accounts of more than $100,000 reported in Memorandum
item 1.b.(1) above.
Indicate in the appropriate box at the right whether your bank has a
method or procedure for determining a better estimate of uninsured
deposits than the estimate described above Yes / No
6861 N/A M.2.a.
b. If the box marked YES has been checked, report the estimate of uninsured RCON
deposits determined by using your bank's method or procedure 5597 0 M.2.b.
3. Has the reporting institution been consolidated with a parent bank or savings
association in that parent bank's or parent savings association's
Call Report or Thrift Financial Report?
If so, report the legal title and FDIC Certificate Number of the parent bank or
parent savings association: FDIC Cert No.
TEXT A545 RCON A545 N/A M.3.
</TABLE>
32
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-23
Schedule RC-R--Regulatory Capital
This schedule must be completed by all banks as follows: Banks that
reported total assets of $1 billion or more in Schedule RC, item 12,
for June 30, 1997, must complete items 2 through 9 and Memoranda items
1 and 2. Banks with assets of less than $1 billion must complete
items 1 through 3 below or Schedule RC-R in its entirety, depending on
their response to item 1 below.
<TABLE>
<CAPTION>
<S> <C>
1. Test for determining the extent to which Schedule RC-R must be completed.
To be completed only by banks with total assets of less than $1 billion. C480
Indicate in the appropriate box at the right whether the bank has total capital Yes No
greater than or equal to eight percent of adjusted total assets. RCFD 6056 YES 1.
</TABLE>
For purposes of this test, adjusted total assets equals total assets
less cash, U.S. Treasuries, U.S. Government agency obligations, and 80
percent of U.S. Government-sponsored agency obligations plus the
allowance for loan and lease losses and selected off-balance sheet
items as reported on Schedule RC-L (see instructions).
If the box marked YES has been checked, then the bank only has to complete
items 2 and 3 below. If the box marked NO has been checked, the bank must
complete the remainder of this schedule.
A NO response to item 1 does not necessarily mean that the bank's actual
risk-based capital ratio is less than eight percent or that the bank is not
in compliance with the risk-based capital guidelines.
NOTE: All banks are required to complete items 2 and 3 below. See optional
worksheet for items 3.a through 3.f.
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCFD
<S> <C>
2. Portion of qualifying limited-life capital instruments
(original weighted average maturity of at least five
years) that is includible in Tier 2 capital:
a. Subordinated debt(1) and intermediate term preferred stock A515 550,000 2.a.
b. Other limited-life capital instruments A516 0 2.b.
3. Amounts used in calculating regulatory capital ratios
(report amounts determined by the bank for its own
internal regulatory capital analyses consistent with applicable
capital standards):
(1) Tier 1 capital 8274 1,934,493 3.a.(1)
(2) Tier 2 capital 8275 815,952 3.a.(2)
(3) Tier 3 capital 1395 0 3.a.(3)
b. Total risk-based capital 3792 2,750,445 3.b.
(3) Tier 3 Capital
c. Excess allowance for loan and lease losses (amount that exceeds
1.25% of gross risk-weighted assets) A222 1,333 3.c.
d. (1) Net risk-weighted assets (gross risk-weighted assets less excess
allowance reported in item 3.c above and all other deductions) A223 21,878,054 3.d.(1)
(2) Market risk equivalent assets 1651 0 3.d.(2)
e. Maximum contractual dollar amount of recourse exposure in low level
recourse transactions (to be completed only if the bank uses the "direct
reduction method" to report these transactions in Schedule RC-R) 1727 198 3.e.
f. "Average total assets" (quarterly average reported in Schedule RC-K,
item 9, less all assets deducted from Tier 1 capital)(2) A224 25,864,672 3.f.
</TABLE>
Items 4-9 and Memoranda items 1 and 2 are to be completed by banks that
answered NO to item 1 above and by banks with total assets of $1 billion or
more.
<TABLE>
<CAPTION>
(Column A) (Column B)
Assets Credit Equiv-
Recorded alent Amount
on the of Off-Balance
Balance Sheet Sheet Items(3)
RCFD RCFD
<S> <C>
4. Assets and credit equivalent amounts of off-balance sheet items
assigned to the Zero percent risk category:
a. Assets recorded on the balance sheet 5163 544,640 4.a.
b. Credit equivalent amount of off-balance sheet items 3796 0 4.b.
</TABLE>
__________
(1) Exclude mandatory convertible debt reported in Schedule RC-M, item 7.
(2) Do not deduct excess allowance for loan and lease losses.
(3) Do not report in column B the risk-weighted amount of assets reported in
column A.
33
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-24
Schedule RC-R--Continued
<TABLE>
<CAPTION>
(Column A) (Column B)
Assets Credit Equiv-
Recorded alent Amount
on the of Off-Balance
Balance Sheet Sheet Items (1)
Dollar Amounts in Thousands RCFD RCFD
<S> <C>
5. Assets and credit equivalent amounts of off-balance
sheet items assigned to the 20 percent risk category:
a. Assets recorded on the balance sheet 5165 5,826,861 5.a.
b. Credit equivalent amount of off-balance sheet items 3801 156,020 5.b.
6. Assets and credit equivalent amounts of off-balance
sheet items assigned to the 50 percent risk category:
a. Assets recorded on the balance sheet 3802 4,816,874 6.a.
b. Credit equivalent amount of off-balance sheet items 3803 1,062,793 6.b.
7. Assets and credit equivalent amounts of off-balance sheet
items assigned to the 100 percent risk category:
a. Assets recorded on the balance sheet 3804 14,652,839 7.a.
b. Credit equivalent amount of off-balance sheet items 3805 3,090,139 7.b.
8. On-balance sheet asset values excluded from and deducted in
the calculation of the risk-based capital ratio (2) 3806 92,864 8.
9. Total assets recorded on the balance sheet (sum of items
4.a, 5.a, 6.a, 7.a, and 8, column A)(must equal Schedule RC,
item 12 plus items 4.b and 4.c) 3807 25,934,078 9.
</TABLE>
Memoranda
<TABLE>
<CAPTION>
Dollar Amounts in Thousands RCFD
<S> <C>
1. Current credit exposure across all off-balance sheet derivative contracts
covered by the risk-based capital standards 8764 18,212 M.1.
</TABLE>
<TABLE>
<CAPTION>
With a remaining maturity of
(Column A) (Column B) (Column C)
One year or less Over one year Over five years
through five years
RCFD RCFD RCFD
<S> <C>
2. Notional principal amounts of
off-balance sheet derivative
contracts (3):
a. Interest rate contracts 3809 3,674,266 8766 3,125,000 8767 0 M.2.a.
b. Foreign exchange contracts 3812 0 8769 0 8770 0 M.2.b.
c. Gold contracts 8771 0 8772 0 8773 0 M.2.c.
d. Other precious metals contracts 8774 0 8775 0 8776 0 M.2.d.
e. Other commodity contracts 8777 0 8778 0 8779 0 M.2.e.
f. Equity derivative contracts A000 0 A001 0 A002 0 M.2.f.
</TABLE>
__________
(1) Do not report in column B the risk-weighted amount of assets
reported in column A.
(2) Include the difference between the fair value and the amortized
cost of available-for-sale debt securities in item 8 and report the
amortized cost of these debt securities in items 4 through 7 above.
For available-for-sale equity securities, if fair value exceeds cost,
include the difference between the fair value and the cost in item 8
and report the cost of these equity securities in items 5 through 7
above; if cost exceeds fair value, report the fair value of these
equity securities in items 5 through 7 above and include no amount
in item 8. Item 8 also includes on-balance sheet asset values (or
portions thereof) of off-balance sheet interest rate, foreign exchange
rate, and commodity contracts and those contracts (e.g., futures contracts)
not subject to risk-based capital. Exclude from item 8 margin accounts and
accrued receivables not included in the calculation of credit equivalent
amounts of off-balance sheet derivatives as well as any portion of the
allowance for loan and lease losses in excess of the amount that may be
included in Tier 2 capital.
(3) Exclude foreign exchange contracts with an original maturity of 14
days or less and all futures contracts.
34
<PAGE>
Legal Title of Bank: CRESTAR BANK
Address: P.O. Box 4418
City, State Zip: Atlanta, GA 30302
FDIC Certificate No.: 12543
Call Date: 09/30/1999 FFIEC 031
Page RC-25
Optional Narrative Statement Concerning the Amounts Reported in the
Reports of Condition and Income
at close of business on December 31, 1998
CRESTAR BANK Atlanta GA
------------ ------- --
Legal Title of Bank City State
The management of the reporting bank may, if it wishes, submit a brief
narrative statement on the amounts reported in the Reports of
Condition and Income. This optional statement will be made available
to the public, along with the publicly available data in the Reports
of Condition and Income, in response to any request for individual
bank report data. However, the information reported in column A and
in all of Memorandum item 1 of Schedule RC-N is regarded as
confidential and will not be released to the public.
BANKS CHOOSING TO SUBMIT THE NARRATIVE STATEMENT SHOULD ENSURE THAT THE
STATEMENT DOES NOT CONTAIN THE NAMES OR OTHER IDENTIFICATIONS OF INDIVIDUAL
BANK CUSTOMERS, REFERENCES TO THE AMOUNTS REPORTED IN THE CONFIDENTIAL
ITEMS IN SCHEDULE RC-N, OR ANY OTHER INFORMATION THAT THEY ARE NOT
WILLING TO HAVE MADE PUBLIC OR THAT WOULD COMPROMISE THE PRIVACY OF
THEIR CUSTOMERS.
All information furnished by the bank in the narrative statement must
be accurate and not misleading. Appropriate efforts shall be taken by
the submitting bank to ensure the statement's accuracy.
If, subsequent to the original submission, material changes are
submitted for the data reported in the Reports of Condition and
Income, the existing narrative statement will be deleted from the
files, and from disclosure; the bank, at its option, may replace it
with a statement appropriate to the amended area.
The optional narrative statement will appear in agency records and in
release to the public exactly as submitted (or amended as described in
the preceding paragraph) by the management of the bank.
THE STATEMENT WILL NOT BE EDITED OR SCREENED IN ANY WAY BY THE SUPERVISORY
AGENCIES FOR ACCURACY OR RELEVANCE. DISCLOSURE OF THE STATEMENT SHALL NOT
SIGNIFY THAT ANY FEDERAL SUPERVISORY AGENCY HAS VERIFIED OR CONFIRMED THE
ACCURACY OF THE INFORMATION CONTAINED THEREIN. A STATEMENT TO THIS EFFECT
WILL APPEAR ON ANY PUBLIC RELEASE OF THE OPTIONAL STATEMENT SUBMITTED BY THE
MANAGEMENT OF THE REPORTING BANK.
- --------------------------------------------------------------------------------
C471 C472
RCON
----
X = No comment Y = Cmment ________________________________ 6979 [ X ]
BANK MANAGEMENT STATEMENT (please type or print clearly):
TEXT (70 characters per line)
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
----------------------------------------------------------------
________________________________________________________________
Signature of Executive Officer of Bank Date of Signature
35
<PAGE>
THIS PAGE IS TO BE COMPLETED BY ALL BANKS
<TABLE>
<S> <C>
CRESTAR BANK OMB No. for OCC: 1557-0081
P.O. BOX 4418 OMB No. For FDIC: 3064-0052
Atlanta, GA 30302 OMB No. For Federal Reserve: 7100-0036
Expiration Date: 3/31/2002
SPECIAL REPORT
(Dollar Amounts in Thousands)
CLOSE OF BUSINESS FDIC Certificate Number
DATE
09/30/1999 12543 C-700
</TABLE>
LOANS TO EXECUTIVE OFFICERS (Complete as of each Call Report Date)
The following information is required by Public Laws 90-44 and 102-
242, but does not constitute a part of the Report of Condition. With
each Report of Condition, these Laws require all banks to furnish a
report of all loans or other extensions of credit to their executive
officers made since the date of the previous Report of Condition.
Data regarding individual loans or other extensions of credit are not
required. If no such loans or other extensions of credit were made
during the period, insert "none" against subitem (a). (Exclude the
first $15,000 of indebtedness of each executive officer under bank
credit card plan.) See Sections 215.2 and 215.3 of Title 12 of the
Code of Federal Regulations (Federal Reserve Board Regulation O) for
the definitions of "executive officer" and "extension of credit,"
respectively. Exclude loans and other extensions of credit to
directors and principal shareholders who are not executive officers.
<TABLE>
<S> <C>
a. Number of loans made to executive officers since the
previous Call Report date RCFD 3561 0 a.
b. Total dollar amount of above loans (in thousands of
dollars) RCFD 3562 0 b.
c. Range of interest charged on above loans
(example: 9 3/4% = 9.75)
RCFD 7701 0.00% to RCFD 7702 0.00% c.
</TABLE>
<TABLE>
<CAPTION>
<S> <C>
- ----------------------------------------------------------------------------------------------
Signature and Title of Officer Authorized to Sign Report: Date(Month, Day, Year):
- ----------------------------------------------------------------------------------------------
</TABLE>
FDIC 8040/53 (3-98)
36
<PAGE>
<TABLE>
<CAPTION>
REPORT OF CONDITION
- --------------------------------------------------------------------------------
<S> <C>
Consolidating domestic subsidiaries of the
Crestar Bank
in the state of GA at the close of business on September 30, 1999
published in response to call made by (Enter additional information below
4769
4769
Statement of Resources and Liabilities
Dollar Amounts in Thousands
- -----------------------------------------------------------------------------
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin 1,124,845
Interest-bearing balances 2,998
Securities:
Held-to-maturity securities 0
Available-for-sale securities 4,884,760
Federal funds sold and securities purchased under agreements to resell 15,877
Loans and lease financing receivables:
Loans and leases, net of unearned income 18,451,070
LESS: Allowance for loand and lease losses 274,825
LESS: Allocated transfer risk reserve 0
Loans and leases, net of unearned income, alloance, and reserve 18,176,245
Trading Assets 0
Premises and fixed assets (including capitalized leases) 438,070
Other real estate owned 14,586
Investments in unconsolidated subsidiaries and associated companies 15,080
Customers' liability to this bank on acceptances outstanding 6,105
Intangible assets 344,150
Other assets 636,537
Total assets 25,659,253
FDIC 8040/54B (3-90)
- -------------------------------------------------------------------------------
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
REPORT OF CONDITION (continued)
- --------------------------------------------------------------------------------------
<S> <C>
LIABILITIES
Dollar Amounts in Thousands
- -----------------------------------------------------------------------------------------------------------
Deposits:
In domestic offices 17,461,014
Noninterest-bearing 3,932,856
Interest-bearing 13,528,158
In foreign offices, Edge and Agreement subsidiaries, and IBFs 27,900
Noninterest-bearing 0
Interest-bearing 27,900
Federal funds purchased and securities sold under agreements to repurchase 4,346,259
Demand notes issued to the U.S. Treasury 484,504
Trading liabilities 0
Other borrowed money:
With remaining maturity of one year or less 57,834
With a remaining maturity of more than one year through three years 10,596
With a remaining maturity of more than three years 190,322
Bank's liability on acceptances executed and outstanding 6,105
Subordinated notes and debentures 625,000
Other liabilities 435,587
Total liabilities 23,645,121
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock 146,955
Surplus 363,520
Undivided profits and capital reserves 1,565,061
Net unrealized holding gains (losses) on available-for-sale securities (61,404)
Accumulated net gains (losses) on cash flow hedges 0
Cumulative foreign currency translation adjustments 0
Total equity capital 2,014,132
Total liabilities and equity capital 25,659,253
I,
We, the undersigned directors, attest to the 4769
correctness of this statement of resources and (Name, Title)
liabilities. We declare that it has been examined of the above named bank do hereby declare
by us, and to the best of our knowledge and that this Report of Condition is true and
belief has been prepared in conformance correct to the best of my knowledge and belief.
with the instructions and is true and correct.
Text
----
4769
Director #1 ------------------------------------------------------
Director #2 ------------------------------------------------------
Director #3 ------------------------------------------------------
FDIC 8040/54B (Page 2)
- --------------------------------------------------------------------------------------------
</TABLE>
