As filed with the Securities and Exchange Commission on August 28, 1997
Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________
Form S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_____________________
WALDEN RESIDENTIAL PROPERTIES, INC.
(Exact name of Registrant as specified in its charter)
Maryland One Lincoln Centre, Suite 400 75-2506197
5400 LBJ Freeway
Dallas, Texas 75240
(972) 788-0510
(State or other (Address, including zip code, (I.R.S. Employer
jurisdiction of and telephone number, including Identification No.)
incorporation or area code, of Registrant's
organization) Principal Executive Offices)
_____________________
Don R. Daseke
Chairman of the Board of Directors
Walden Residential Properties, Inc.
One Lincoln Centre, Suite 400
5400 LBJ Freeway
Dallas, Texas 75240
(972) 788-0510
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
_____________________
Copies to:
Kenneth L. Betts, Esq.
Winstead Sechrest & Minick P.C.
1201 Elm Street, Suite 5400
Dallas, Texas 75270
_____________________
Approximate date of commencement of proposed sale to public:
As soon as practicable following the effective date of this Registration
Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. X
---
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.
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(c)
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.
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Proposed Proposed
Maximum Maximum
Title of Shares Amount to be Aggregate Price Aggregate Offering Amount of
to be Registered Registered per Share (1) Price (1) Registration Fee (2)
- ---------------- ------------ --------------- ------------------ ----------------
<S> <C> <C> <C> <C>
Common Stock, $.01 1,000,000 Shares $23.75 $23,750,000 $7,197
par value
</TABLE>
(1) Estimated solely for the purpose of calculating the registration fee.
(2) Pursuant to Rule 457(c) under the Securities Act of 1933, the
registration fee has been calculated based upon the average of the
high and low prices per share on the New York Stock Exchange on
August 25, 1997.
_____________________
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this
Registration Statement shall 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.
PROSPECTUS
WALDEN RESIDENTIAL PROPERTIES, INC.
Dividend Reinvestment and Stock Purchase Plan
1,000,000 Shares of Common Stock
This Prospectus relates to 1,000,000 shares of common stock,
par value $.01 per share (the "Common Stock"), of Walden
Residential Properties, Inc., a Maryland corporation (the
"Company"), to be issued pursuant to the Company's Dividend
Reinvestment and Stock Purchase Plan (the "Plan"). The Plan
provides holders of Common Stock and holders of the Company's
outstanding preferred stock, par value $.01 per share (the
"Preferred Stock"), with an opportunity to invest cash
distributions on shares of Common Stock and/or Preferred Stock and
optional cash payments for additional shares of Common Stock
without payment of any brokerage commission or service charge.
Shares of Common Stock for the Plan will be purchased directly from
the Company. No open market purchases of shares of Common Stock
are permitted for the Plan. The Plan is administered by Boston
EquiServe, L.P. (the "Plan Agent").
Participants in the Plan may purchase additional shares of
Common Stock by (i) having the cash distributions on all, or part,
of their shares of Common Stock and/or Preferred Stock
automatically reinvested, (ii) by receiving directly, as usual,
their cash distributions, if, as and when declared, on shares of
Common Stock registered in their names and investing in the Plan by
making cash payments of not less than $100 per payment or more than
$25,000 per calendar quarter ("optional cash payments"), or
(iii) by investing both their cash distributions and such optional
cash payments.
Stockholders may begin participating in the Plan by completing
an Authorization Card and returning it to the Plan Agent.
Participants may terminate their participation at any time.
Stockholders who do not wish to participate in the Plan need not
take any action and will continue to receive their cash dividends,
if, as and when declared, as usual. It is suggested that this
Prospectus be retained for future reference.
The price per share for the additional shares of Common Stock
purchased from the Company with reinvested cash distributions will
be 95% of the Market Price (as defined in the Plan), and the price
per share for shares of Common Stock purchased from the Company
with optional cash payments will be 97% of the Market Price.
____________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF
THIS PROSPECTUS. ANY REPRESENTATION TO THE
CONTRARY IS A CRIMINAL OFFENSE
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT
PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY
REPRESENTATION TO THE CONTRARY IS UNLAWFUL.
_____________________
The date of this Prospectus is August 27, 1997.
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange
Commission (the "Commission") a Registration Statement (of which
this Prospectus is a part) on Form S-3 under the Securities Act
with respect to the shares of Common Stock offered hereby. This
Prospectus does not contain all of the information set forth in the
Registration Statement, certain portions of which have been omitted
as permitted by the rules and regulations of the Commission.
Statements contained in this Prospectus as to the content of any
contract or other document are not necessarily complete, and in
each instance reference is made to the copy of the contract or
other document filed as an exhibit to the Registration Statement,
each statement being qualified in all respects by that reference
and the exhibits to the Registration Statement. For further
information regarding the Company and the shares of Common Stock
offered hereby, reference is hereby made to the Registration
Statement and the exhibits to the Registration Statement which may
be obtained from the Commission at its principal office in
Washington, D.C., upon payment of fees prescribed by the
Commission.
The Company is subject to the information requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
and in accordance therewith, files reports, proxy and information
statements and other information with the Commission. The reports,
proxy and information statements, the Registration Statement and
exhibits thereto, and other information filed by the Company with
the Commission can be inspected and copied at the Public Reference
Section of the Commission at Room 1024, Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the regional offices
of the Commission located at 13th Floor, 7 World Trade Center, New
York, New York 10048, and at 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661-2511. Copies of the material can be
obtained from the Public Reference Section of the Commission at
Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington,
D.C. 20549 at prescribed rates. Such reports, proxy statements and
other information may also be obtained from the web site that the
Commission maintains at http://www.sec.gov. The Common Stock is
traded on the NYSE. The reports, proxy and information statements
and other information can also be inspected at the offices of the
New York Stock Exchange, 20 Broad Street, New York, New York 10005.
The Company furnishes its stockholders with annual reports
containing financial statements audited by its independent auditors
and with quarterly reports containing unaudited summary financial
information for each of the first three quarters of each fiscal
year.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following
documents heretofore filed by the Company with the Commission:
(a) The Company's Annual Report on Form 10-K for the fiscal
year ended December 31, 1996 (the "Form 10-K");
(b) Amendment No. 1 on Form 10-K/A to the Form 10-K;
(c) Amendment No. 2 on Form 10-K/A to the Form 10-K;
(d) The Company's Quarterly Report on Form 10-Q for the
fiscal quarter ended March 31, 1997;
(e) Amendment No. 1 to the Company's Quarterly Report on Form
10-Q for the fiscal quarter ended March 31, 1997;
(f) The Company's Current Report on Form 8-K, dated April 21,
1997;
(g) The Company's Quarterly Report on Form 10-Q for the
fiscal quarter ended June 30, 1997; and
(h) The Company's Registration Statement on Form 8-A filed
November 19, 1993.
All documents filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of
this Prospectus and prior to the termination of the offering of the
shares of Common Stock made hereby shall be deemed to be
incorporated by reference into this Prospectus.
Any statement contained in a document all or a portion of
which is incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of
the Registration Statement and this Prospectus to the extent that
a statement contained in the Registration Statement, this
Prospectus, or any other subsequently filed document that is also
incorporated by reference herein modifies or supersedes that
statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part
of this Prospectus.
The Company hereby undertakes to provide without charge to
each person, including any beneficial owner, to whom a Prospectus
is delivered, upon written or oral request of that person, a copy
of any document incorporated herein by reference (other than
exhibits to those documents unless the exhibits are specifically
incorporated by reference into the documents that this Prospectus
incorporates by reference). Requests should be directed to Deborah
B. Attner, Shareholder Relations, Walden Residential Properties,
Inc., One Lincoln Centre, Suite 400, 5400 LBJ Freeway, Dallas,
Texas 75240.
THE COMPANY
The Company is a self-administered, self-managed, fully
integrated real estate investment trust focused on middle income
multifamily residential properties located primarily in selected
Southwestern and Southeastern markets. The Company, a Maryland
corporation with headquarters in Dallas, Texas, was formed in
September 1993 to continue and expand the multifamily property
ownership, management, acquisition and marketing operations and
related business objectives and strategies of The Walden Group,
Inc. and its subsidiaries and affiliates (collectively, the "Walden
Predecessors"). The Company currently owns and operates 76
multifamily residential properties containing 23,420 apartment
units. Approximately 88% of the Properties are located in the
Dallas/Fort Worth, Jacksonville, Phoenix, Austin, Oklahoma City,
Tampa, Tulsa, Houston, Austin and Salt Lake City areas, with the
remaining Properties primarily located in other areas in the
Southwest and Southeast regions of the United States. The
Properties had a weighted average occupancy rate of approximately
95.3% at August 17, 1997. The Company also manages on a fee basis
for third parties three additional multifamily residential
properties containing 1,179 apartment units.
Upon completion of its initial public offering in February
1994, the Company purchased the multifamily operations of the
Walden Predecessors, including 18 Properties containing 5,895
apartment units (of which three properties containing 827 units
were sold in 1995 and 1996), and concurrently purchased two
additional Properties containing 448 apartment units, one of which
was owned by a third party and the other of which was principally
owned by the Walden Predecessors. Since the consummation of the
initial public offering in February 1994, the Company has acquired
61 Properties (of which two properties containing 546 units were
sold in 1995 and 1996), containing an aggregate 18,450 apartment
units, for an aggregate purchase price of approximately $607
million. Management believes that these activities are consistent
with its core acquisition strategy of acquiring well located garden
apartment properties at costs less than replacement costs, which
serve middle income residents and can benefit from the Company's
comprehensive management programs.
The Company is operated under the direction of Don R. Daseke,
Chairman of the Board and Chief Executive Officer of the Company,
and a management team substantially all of whom were formerly
employed by the Walden Predecessors. The Company's three senior
executives have an average tenure with the Company and the Walden
Predecessors of 16 years and have an average of 23 years experience
in the multifamily property business. The Company is fully
integrated with operations that include multifamily property
acquisitions, redevelopment services, management, marketing,
finance, leasing and asset management.
The Company's executive offices are located at One Lincoln
Centre, Suite 400, 5400 LBJ Freeway, Dallas, Texas 75240. The
telephone number is (972) 788-0510. The Company was incorporated
in Maryland on September 29, 1993 and the duration of its existence
is perpetual.
DESCRIPTION OF THE PLAN
The following, in question and answer form, is a summary
description of the provisions of the Dividend Reinvestment and
Stock Purchase Plan of the Company. This description should be read
in conjunction with, and is qualified in its entirety by, reference
to the Plan, a copy of which is attached to this Prospectus as
Appendix A. Capitalized terms not otherwise defined herein shall
have the meanings ascribed thereto in the Plan.
Purpose
- -------
1. What is the purpose of the Plan? The purpose of the Plan
is to provide holders of shares of Common Stock and Preferred Stock
with an opportunity to reinvest cash dividends in additional shares
of Common Stock and/or make optional cash payments for additional
shares of Common Stock, without payment of any brokerage
commission, service charge or other expense. Shares of Common Stock
for the Plan will be purchased directly from the Company. No
shares of Common Stock will be purchased for the Plan in the open
market. The Company will receive the proceeds from the sale of
shares of Common Stock under the Plan and will use such proceeds
for general corporate purposes. See "Use of Proceeds."
Advantages
- ----------
2. What are the options available to Stockholders?
Participants in the Plan may purchase additional shares of Common
Stock by (i) having the cash dividends on all, or part, of their
shares of Common Stock and/or Preferred Stock automatically
reinvested, (ii) receiving directly, as usual, their cash
dividends, if, as and when declared, on their shares of Common
Stock and/or Preferred Stock and investing in the Plan by making
cash payments of not less than $100 per payment or more than
$25,000 per calendar quarter, or (iii) investing both their cash
dividends and such optional cash payments.
3. What are the advantages of the Plan? No brokerage
commissions, fees or service charges are paid by Participants in
connection with purchases under the Plan; provided, however, that
if shares of Common Stock or Preferred Stock are registered in the
name of a nominee or broker, such nominee or broker may charge a
commission or fee. Full investment of dividends is possible under
the Plan because the Plan permits fractional shares, as well as
whole shares, of Common Stock, to be purchased and credited to
Participants' accounts. Regular statements of account provide
simplified record keeping. All purchases, by reinvestment of
dividends or optional cash payments, will be credited to the
Participant's Noncertificated Share account on the records of the
Company maintained by the Plan Agent.
The price of shares of Common Stock purchased under the Plan
with reinvested cash dividends is 95% of the Market Price (as
hereinafter defined) for such shares, and the price of shares of
Common Stock purchased under the Plan with optional cash payments
is 97% of the Market Price for such shares.
Administration
- --------------
4. Who administers the Plan for Participants? The Plan
Agent administers the Plan for Participants, keeps records, sends
statements of account to Participants and performs other duties
relating to the Plan. The current Plan Agent is Boston EquiServe,
L.P. The Plan Agent also serves as Transfer Agent for the shares
of Common Stock and Preferred Stock. Should the Plan Agent resign,
or be asked to resign, another agent will be asked to serve.
All optional cash payments should be sent to the Plan Agent
addressed as follows:
Boston EquiServe, L.P.
P.O. Box 1681
Mail Stop 45-01-23
Boston, MA 02105-9904
All other communications, including certificates to be
deposited to plan accounts, should be sent to:
Boston EquiServe, L.P.
P.O. Box 8040
Mail Stop 45-02-09
Boston, MA 02266-8040
Participation
- -------------
5. Who is eligible to participate? All holders of record of
shares of Common Stock and Preferred Stock are eligible to
participate in the Plan. Beneficial owners whose shares of Common
Stock and/or Preferred Stock are registered in names other than
their own (for instance, in the name of a broker, bank nominee or
other record holder) must either (i) arrange for the broker, bank
nominee or other record holder to join in the Plan or (ii) have the
shares of Common Stock and/or Preferred Stock they wish to enroll
in the Plan transferred to their own name. Only holders of record
may participate in the optional cash payment feature of the Plan.
The Company reserves the right to refuse to permit a broker, bank
nominee or other record holder to participate in the Plan if the
terms of such participation would, in the Company's sole judgment,
result in excessive cost or burden on the Company. In addition,
the Company may refuse participation in the Plan to stockholders
residing in states whose securities laws do not exempt shares of
Common Stock offered pursuant to the Plan from registration.
6. How does a Stockholder join the Plan? In order to
participate in the Plan, an eligible stockholder must properly
complete the Authorization Card furnished by the Plan Agent and
return it to Boston EquiServe, L.P., P.O. Box 8040, Mail Stop
45-02-09, Boston, MA 02266-8040. An Authorization Card and
postage-paid envelope are enclosed with this Prospectus and
additional cards may be obtained at any time by stockholders by
written or oral request to the Plan Agent at the foregoing address.
Telephone requests or general inquiries may be made by calling
(617/575-3120).
7. What does the Authorization Card provide? The
Authorization Card provides for the purchase by stockholders of
additional shares of Common Stock through the following investment
options offered under the Plan:
Full Distribution Reinvestment -- Directs the Plan Agent to
reinvest cash dividends with respect to all shares of Common
Stock and/or Preferred Stock owned by the Participant
(including whole and fractional shares acquired under the
Plan) and permits a Participant to make optional cash payments
for the purchase of additional shares of Common Stock in
accordance with the Plan.
Partial Distribution Reinvestment -- Directs the Plan Agent to
remit cash dividends on the number of shares of Common Stock
and/or Preferred Stock specified on the Authorization Card and
to invest in additional shares of Common Stock any dividends
paid on the remaining shares of Common Stock and/or Preferred
Stock owned by the Participant. This investment option also
permits a Participant to make optional cash payments for the
purchase of additional shares of Common Stock in accordance
with the Plan.
Optional Payments Only -- Permits a Participant to make
optional cash payments for the purchase of additional shares
of Common Stock in accordance with the Plan.
Cash dividends on shares of Common Stock credited to the
Participant's account under the Plan are automatically reinvested
to purchase additional shares of Common Stock.
Stockholders who do not wish to participate in the Plan will
receive cash dividends as declared, in the usual manner.
8. Is partial participation possible under the Plan? A
stockholder who desires the dividends on only some full shares of
Common Stock and/or Preferred Stock to be reinvested under the Plan
may indicate such number of shares of Common Stock and/or Preferred
Stock on the Authorization Card under the heading "Partial
Distribution Reinvestment." Cash dividends will continue to be paid
on the remaining shares of Common Stock and/or Preferred Stock.
9. When may a Stockholder join the Plan? If an
Authorization Card specifying "Full Distribution Reinvestment," or
"Partial Distribution Reinvestment" is properly completed and
received by the Plan Agent on or prior to the record date
established for the payment of the next dividend, reinvestment will
commence with that dividend payment. If the Authorization Card is
received in between any dividend record date and the applicable
Reinvestment Date (the date on which a dividend is paid, which the
Company anticipates to be in March, June, September and December
each year unless that date is not a Trading Day (as defined in the
Plan), in which case the Reinvestment Date shall be the next
succeeding Trading Day), that dividend will be paid in cash and the
stockholder's initial dividend reinvestment will begin with the
next dividend. The record date is normally a business day at or
near the end of the preceding month.
Optional cash payments received from a Participant not more
than thirty (30) calendar days nor less than three (3) business
days prior to a Reinvestment Date will be applied toward the
purchase of additional shares of Common Stock as of such
Reinvestment Date. No interest will be paid on funds received and
held for the purchase of shares of Common Stock under the Plan.
Costs
- -----
10. Are there any expenses to Participants in connection with
purchases under the Plan? No. Participants will incur no brokerage
commissions, service or other charges for purchases made under the
Plan. Any costs of administration of the Plan will be borne by the
Company.
Purchases
- ---------
11. How many shares of Common Stock will be purchased for
Participants? The number of shares of Common Stock to be purchased
will be determined by the amount of the Participant's dividends
and/or optional cash payments being reinvested or paid and the
price of the shares of Common Stock. Each Participant's account in
the Plan will be credited with the number of shares of Common
Stock, including fractional shares computed to three (3) decimal
places, equal to the amount of the dividends, and/or optional cash
to be reinvested or paid divided by the applicable purchase price
of the shares of Common Stock.
12. How will the purchase price of shares of Common Stock be
determined? Shares of Common Stock for the Plan will be purchased
from the Company. No shares of Common Stock will be purchased by
the Plan in the open market. The price per share for all shares of
Common Stock purchased under the Plan with reinvested cash
dividends will be 95% of the average of the closing sales prices of
the Common Stock on the composite tape of the New York Stock
Exchange, Inc. for the five Trading Days immediately preceding the
applicable Reinvestment Date (the "Market Price"). The price per
share for all shares of Common Stock purchased under the Plan with
optional cash payments will be 97% of the Market Price.
13. When will dividends and/or optional cash payments be
invested? Dividends and optional cash payments will be invested in
additional shares of Common Stock and credited to a Participant's
Noncertificated Share account with respect to each Reinvestment
Date.
14. Will certificates be issued to Participants for shares of
Common Stock purchased under the Plan? No certificates for shares
of Common Stock acquired by a Participant under the Plan will be
issued, except as described in Question 17. Shares of Common Stock
purchased under the Plan, whether through dividend reinvestment or
optional cash payment, will be credited to a Participant's
Noncertificated Share account and will be shown on a Participant's
statement of account. Certificates for the shares of Common Stock
purchased pursuant to the Plan will be issued to Participants upon
their written request, except that no certificates will be issued
for fractional shares of Common Stock. A Participant requesting a
certificate for all the shares of Common Stock in the Participant's
Noncertificated Share account will receive cash for the fractional
shares only if participation in the Plan is terminated. (See
Question 17 for how a Participant may obtain certificates.) Cash
dividends on all shares of Common Stock held in the Participant's
Noncertificated Share account under the Plan will be automatically
reinvested to purchase additional shares of Common Stock which will
be reflected in the Participant's Noncertificated Share account.
Optional Cash Payments
- ----------------------
15. Who is eligible to make optional cash payments? Record
owners of shares of Common Stock and/or Preferred Stock who have
executed an Authorization Card are eligible to make optional cash
payments of not less than $100 nor more than $25,000 per calendar
quarter. A stockholder may participate in the Plan exclusively by
making an optional cash payment by checking the "Optional Payments
Only" box on the Authorization Card. Moreover, even if the
"Optional Payments Only" box is checked, all dividends payable on
shares of Common Stock purchased with optional cash payments and
retained in the Participant's Noncertificated Share account will be
automatically reinvested in additional shares of Common Stock. A
beneficial owner of shares of Common Stock and/or Preferred Stock
who wishes to make optional cash payments must become the record
owner of by transferring all or some of his or her shares into his
or her own name. Checks or money orders should be payable to
Walden Residential Properties, Inc. and mailed to Boston EquiServe,
L.P., P.O. Box 1681, Mail Stop 45-01-23, Boston, MA 02105-9904. Do
not send cash. Payments delivered to any other address will not
constitute valid delivery. No interest is paid on optional cash
payments. Participants can request the return of any optional cash
payment which had not yet been invested, provided such request is
received by the Plan Agent no later than two business days prior to
the applicable Reinvestment Date. In the event any check or money
order from a bank account is returned unpaid for any reason, the
Plan Agent will consider the request for investment of such money
null and void and shall immediately remove from the Participant's
Plan account shares of Common Stock, if any, purchased upon the
prior credit of such money. The Plan Agent shall thereupon be
entitled to sell these shares to satisfy any uncollected amounts.
If the net proceeds of the sale of such shares are insufficient to
satisfy the balance of such uncollected amounts, the Plan Agent
shall be entitled to sell such additional shares from the
Participant's Plan account to satisfy the uncollected balance.
Report to Participants
- ----------------------
16. What type of reports will be sent to Participants in the
Plan? Participants will receive a quarterly statement indicating
the total dividend payment, the amount of the dividend payment
reinvested, the purchase price per share of Common Stock, the
number of shares of Common Stock purchased and the number of shares
of Common Stock in the Participant's Noncertificated Share account.
These statements are a record of the cost of purchases under the
Plan and should be retained for tax purposes. In addition, each
Participant will receive copies of the Company's annual and
quarterly reports to stockholders, proxy statements and income tax
information for reporting dividends. Beneficial owners whose
shares of Common Stock and/or Preferred Stock are registered in
names other than their own (for instance, in the name of a broker,
bank nominee or other record holder) must arrange to obtain their
copies of such reports from the record holder.
Issuance of Certificates
- ------------------------
17. How may a Participant obtain certificates for shares of
Common Stock purchased under the Plan? A Participant who has
purchased shares of Common Stock under the Plan may obtain
certificates for those shares of Common Stock in the Participant's
Noncertificated Share account at any time by sending a written
request to that effect to the Plan Agent. No certificates will be
issued for fractional shares of Common Stock, but a Participant
requesting termination of participation in the Plan will receive,
in cash, the market price of any fractional shares of Common Stock
as well as certificates for all whole shares of Common Stock held
for such terminating participant in the Noncertificated Share
account. This notice should be mailed to Boston EquiServe, L.P.,
P.O. Box 8040, Mail Stop 45-02-09, Boston, MA 02266-8040. The
Company, however, reserves the right at any time to issue
certificates to Participants for any shares of Common Stock in
their Noncertificated Share accounts. (See Questions 18 and 20 for
information on termination of participation.)
Modification or Termination by a Participant
- --------------------------------------------
18. How does a Participant change or terminate participation
in the Plan? A Participant may change participation from partial
to total dividend reinvestment, from total to partial dividend
reinvestment, or may simply change the number of shares of Common
Stock and/or Preferred Stock which are enrolled in the Plan by
executing and delivering a new Authorization Card to the Plan
Agent, Boston EquiServe, L.P., P.O. Box 8040, Mail Stop 45-02-09,
Boston, MA 02266-8040.
A Participant may terminate participation in the Plan by
notifying the Plan Agent in writing to that effect. Notices will
be effective only upon receipt by the Plan Agent. Notices to
change or discontinue dividend reinvestment received by the Plan
Agent on or before any record date for a dividend payment will be
effective as of that date. In order to re-enter the Plan after
termination, a stockholder must complete a new Authorization Card.
19. Can the shares of Common Stock held in the Plan be sold
through the Plan Agent? A Participant can instruct the Plan Agent
to sell any or all of the whole shares of Common Stock held in the
Plan. The written notification to the Plan Agent should include
the number of shares of Common Stock that are to be sold. The Plan
Agent will make the sale as soon as practicable following receipt
of a Participant's request through independent securities brokers
selected by the Company or the Plan Agent in its sole discretion.
A check for the proceeds of such sale, less brokerage commission
and transfer taxes (if any), will usually be sent by the Plan Agent
on the settlement date, which will be three (3) business days from
the date of sale. No Participant shall have the authority or power
to direct the date or sales price at which shares of Common Stock
may be sold. Requests must indicate the minimum number of shares
to be sold and not the dollar amount to be attained. Any such
request that does not clearly indicate the number of shares of
Common Stock to be sold will be returned to the Participant with no
action taken. A withdrawal/termination form is provided on the
reverse side of the account statement for this purpose. This
notice should be addressed to Boston EquiServe, L.P., P. O. Box
8040, Mail Stop 45-02-09, Boston, MA 02266-8040.
20. What happens to the shares of Common Stock held in the
Noncertificated Share account when a Participant terminates
participation in the Plan? A certificate for the shares of Common
Stock held in the account will be issued to the Participant upon
the Participant's written request or upon a Participant's
termination of participation in the Plan. No fractional shares
will be issued. (See Question 14 for information on share
certificates and Question 17 for information on the cash payment
for fractional shares in the account.)
Other Information
- -----------------
21. What happens if the Company issues a stock dividend,
declares a stock split or has a rights offering? Any shares of
Common Stock issued in a stock dividend or stock split with respect
to a Participant's shares of Common Stock which are subject to the
Plan will be added to the Participant's Noncertificated Share
account. If the Company has a rights offering in which separately
tradable and exercisable rights are issued to registered holders of
Common Stock, the rights attributable to whole shares of Common
Stock in a Participant's Plan account will be transferred to the
Participant as promptly as practicable after the rights are issued.
No partial rights will be issued with respect to fractional shares
of Common Stock in the Participant's account.
22. How will Shares in a Participant's Noncertificated Share
account be voted at a meeting of Stockholders? All of a
Participant's shares of Common Stock, both Certificated and
Noncertificated, may be voted by the Participant. For any meeting
of stockholders, the Participant will be sent proxy material for
that meeting covering all of the shares of Common Stock that the
Participant owns on the record date for the meeting. The
Participant may vote all of Participant's shares of Common Stock in
person or by proxy.
23. What are the Federal income tax consequences of
participation in the Plan? Under the current provisions of the
Internal Revenue Code of 1986, as amended (the "Code"), the
purchase of shares of Common Stock under the Plan will generally
result in the following Federal income tax consequences:
(a) A distribution on the shares of Common Stock will be
treated for Federal income tax purposes as a dividend
distribution received by the Participant notwithstanding
that it is used to purchase additional shares of Common
Stock pursuant to the Plan. The full amount of cash
distributions reinvested under the Plan, plus the 5%
purchase discount from the applicable Market Value,
represents dividend distributions to Participants. As in
the case of cash dividend distributions, the full amount
will be taxable income to the extent of the Company's
current and accumulated earnings and profits, and the
excess will be a return of capital which reduces the
basis of the Participant's shares of stock in the Company
or results in gain to the extent it exceeds such stock
basis.
(b) Distributions paid to corporate stockholders, including
amounts taxable as dividends to corporate Participants
under (a) above, will not be eligible for the corporate
dividends-received deduction under the Code.
(c) A Participant's tax basis in additional shares of Common
Stock acquired under the Plan will be equal to the full
amount treated as a dividend distribution for Federal
income tax purposes. The Participant's holding period
for such shares of Common Stock will commence on the day
after the investment date.
(d) A Participant will not realize any taxable income upon
the receipt of a certificate for full shares of Common
Stock credited to the Participant's account. A
Participant will recognize gain or loss when a fractional
share interest is liquidated or when the Participant
sells or exchanges shares of Common Stock received from
the Plan. Such gain or loss will equal the difference
between the amount which the Participant receives for
such fractional share interest or such shares and the tax
basis therefor.
In the case of Participants whose distributions are subject to
withholding of Federal income tax, distributions will be reinvested
less the amount of tax required to be withheld.
The above is intended only as a general discussion of the
current Federal income tax consequences of participation in the
Plan. Participants should consult their own tax advisors regarding
the Federal and state income tax consequences (including the
effects of any changes in law) of their individual participation in
the Plan.
24. What provision is made for foreign participants subject
to income tax withholding or other Participants subject to back-up
withholding? In the case of both foreign Participants who elect to
have their distributions reinvested and whose distributions are
subject to United States income tax withholding and other
Participants who elect to have the distributions reinvested and who
are subject to "backup" withholding under Section 3406(a)(1) of the
Code, the Plan Agent will invest in shares of Common Stock in an
amount equal to the distributions of such Participants less the
amount of tax required to be withheld. The quarterly statements
confirming purchases made to such Participants will indicate the
net payment reinvested.
Under Section 3406(a)(1) of the Code, the Company is currently
required to withhold for United States income tax purposes 31% of
all distribution payments to a stockholder if (i) such stockholder
has failed to furnish to the Company his taxpayer identification
number ("TIN"), which for an individual is his social security
number, (ii) the Internal Revenue Service (the "Service") has
notified the Company that the TIN furnished by the stockholder is
incorrect, (iii) the Service notifies the Company that back-up
withholding should be commenced because the stockholder has failed
to properly report distributions or (iv) the stockholder has failed
to certify, under penalties of perjury, that he is not subject to
back-up withholding. Stockholders have previously been requested
by the Company or their broker to submit all information and
certifications required in order to exempt them from back-up
withholding if such exemption is available to them.
Optional cash payments received from foreign participants must
be in United States dollars and will be invested in the same way as
payments from other Participants.
25. What are the federal income tax consequences of
participation in the Plan by an IRA, Keogh Plan, 401(k) Plan,
Simplified Pension Account or any corporate employer-sponsored
retirement plan? The tax consequences of participation in the Plan
by retirement plans differ from those outlined above for
individuals. Since the law and regulations regarding the Federal
income tax consequences of retirement plan participation are
complex and subject to change, those considering such participation
should consult with their own retirement plan trustees, custodians
or tax advisors for specific information.
26. What is the responsibility of the Company under the Plan?
Neither the Company nor the Plan Agent will be liable for any act
done in good faith or for any good faith omission to act,
including, without limitation, any claim of liability arising out
of failure to terminate participation in the Plan upon a
Participant's death. In addition, no stockholder, director,
officer, employee, representative or agent of the Company shall be
personally liable for the satisfaction of the Company's obligations
under the Plan and a Participant shall look solely to the assets of
the Company for satisfaction of any claims thereunder.
Participants should recognize that neither the Company nor the
Plan Agent can provide any assurance of a profit or protection
against loss on any shares of Common Stock purchased under the
Plan.
27. May the Plan be changed or discontinued? While the
Company hopes to continue the Plan indefinitely, the Company
reserves the right to suspend or terminate the Plan at any time.
It also reserves the right to make modifications to the Plan and in
particular reserves the right to refuse optional cash payments from
any stockholder who, in the sole discretion of the Company, is
attempting to circumvent the intent of the Plan by making excessive
optional cash payments through multiple stockholder accounts.
Participants will be notified of any suspension, termination or
modification of the Plan. The Company may also suspend, terminate
or refuse participation in the Plan to any investor in the Company
if, participation or any increase in the number of shares of Common
Stock held by such investor, would, in the opinion of the Board of
Directors of the Company, jeopardize the status of the Company as
a REIT.
28. Who answers a Participant's questions or supplies
information? Any inquiries or correspondence about the Plan should
be addressed as follows: Plan Agent, Boston EquiServe, L.P., P.O.
Box 8040, Mail Stop 45-02-09, Boston, MA 02266-8040. Telephone
inquiries to the Plan Agent should be made to (617/575-3120).
29. Will the Plan Agent hold certificated shares? The Plan
provides a share deposit feature to eliminate the need for
Participants to hold physical Common Stock certificates. If a
Participant currently holds physical Common Stock certificates and
would like to combine these shares with his Plan shares held in
book-entry, the Participant should complete the tear-off section of
his account statement and complete the portion designated for share
deposit. The certificates need not be endorsed. The Participant
should ensure that his Common Stock certificates are sent by
registered/insured mail or by some other similar means as the
Participant bears the risk of loss in transit. Participants should
be aware that dividends on the shares so deposited will be
automatically reinvested. Certificates should be sent to the
address set forth in response to Question 4.
USE OF PROCEEDS
The net proceeds from the sale, from time to time, of the
shares of Common Stock by the Company under the Plan will be used
by the Company for general corporate purposes, which may include
the acquisition of multifamily properties as suitable opportunities
arise, the improvement of certain properties in the Company's
portfolio and the repayment of certain then-outstanding
indebtedness. Pending such uses, net proceeds may be invested
temporarily in short-term or intermediate-term government
securities, obligations of the Government National Mortgage
Association, bankers' acceptances, certificates of deposit of
commercial banks and savings and loan associations which are
members of the Federal Deposit Insurance Corporation, deposits in
members of the Federal Home Loan Bank System, time deposits,
commercial paper, other money market instruments, bonds, notes,
common and preferred stock and any other investments, consistent
with the Company's investment policies and qualification as a REIT.
The purpose of the Plan is to provide holders of Common Stock
and Preferred Stock with an opportunity to reinvest cash
distributions in additional shares of Common Stock and/or make
optional cash payments for additional shares of Common Stock,
without payment of any brokerage commission, service charge or
other expense. Shares of Common Stock for the Plan will be
purchased directly from the Company. Such shares of Common Stock
will be treasury shares and/or previously unissued shares and will
provide the Company with funds for general corporate purposes. No
shares of Common Stock will be purchased for the Plan in the open
market.
LEGAL MATTERS
The validity of the shares of Common Stock offered hereby will
be passed upon for the Company by Winstead Sechrest & Minick P.C.,
Dallas, Texas.
EXPERTS
The financial statements for Walden Residential Properties,
Inc. and Walden Predecessors included in the Company's Annual
Report on Form 10-K for the year ended December 31, 1996 referred
to and incorporated by reference in this Prospectus, to the extent
and for the periods indicated in their reports, have been audited
by Deloitte & Touche LLP, independent auditors, certified public
accountants, as stated in their reports appearing therein and have
been so included in reliance upon the reports of such firm given
upon their authority as experts in accounting and auditing.
The combined statement of revenue and certain expenses
(defined as being operating revenues less direct operating
expenses) of Arbor Park, Arbors of Bedford, Arbors of Carrollton,
Arbors of Euless, Arbors of Forest Lane and Arbors of Austin
("Arbors Apartments") for the year ended December 31, 1996,
included in the Current Report of Walden Residential Properties,
Inc. on Form 8-K dated April 21, 1997, has been audited by Deloitte
& Touche LLP, independent auditors, as stated in their report
appearing therein, and has been so incorporated in reliance upon
the report of such firm given upon their authority as experts in
accounting and auditing.
INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company's Articles of Incorporation, as amended and
restated (the "Articles of Incorporation"), provide certain
limitations on the liability of the Company's directors and
officers for monetary damages to the Company. The Articles of
Incorporation obligate the Company to indemnify its directors and
officers, and permit the Company to indemnify its employees and
other agents, against certain liabilities incurred in connection
with their service in such capacities. These provisions could
reduce the legal remedies available to the Company and the
stockholders against these individuals.
The Company's Articles of Incorporation require it to
indemnify (a) the Company's directors and officers whether serving
the Company or at its request any other entity who have been
successful, on the merits or otherwise, in the defense of a
proceeding to which he has made a party by reason of his service in
that capacity, against reasonable expenses incurred by him in
connection with the proceeding unless it is established that
(i) his act or omission was material to the matter giving rise to
the proceeding and was committed in bad faith or was the result of
active and deliberate dishonesty, (ii) he actually received an
improper personal benefit in money, property or services or
(iii) in the case of a criminal proceeding, he had reasonable cause
to believe that his act or omission was unlawful and (b) other
employees and agents of the Company to such extent as shall be
authorized by the Board of Directors of the Company or the
Company's Bylaws and be permitted by law. In addition, the
Articles of Incorporation require the Company to pay or reimburse,
in advance of the final disposition of a proceeding, reasonable
expenses incurred by a director or officer who is a party to a
proceeding under procedures provided for under the Maryland General
Corporation Law (the "MGCL"). The Company's Bylaws also permit the
Company to provide such other and further indemnification or
payment or reimbursement of expenses as the Board of Directors of
the Company deems to be in the interest of the Company and as may
be permitted by the MGCL for directors, officers and employees of
Maryland corporations.
The Company has entered into indemnification agreements with
each of the Company's executive officers and directors. The
indemnification agreements require, among other things, that the
Company indemnify its executive officers and directors to the
fullest extent permitted by law and advance to the executive
officers and directors all related expenses, subject to
reimbursement if it is subsequently determined that indemnification
is not permitted. The Company must also indemnify and advance all
expenses incurred by executive officers and directors seeking to
enforce their rights under the indemnification agreements and cover
executive officers and directors under the Company's directors' and
officers' liability insurance. Although the indemnification
agreements offer substantially the same scope of coverage afforded
by law, it provides assurance to directors and executive officers
that indemnification will be available because such contracts
cannot be modified unilaterally in the future by the Board of
Directors of the Company or the stockholders to eliminate the
rights they provide.
Insofar as indemnification for liabilities under the
Securities Act of 1933, as amended, may be permitted to directors,
officers or persons controlling the Company pursuant to the
foregoing provisions, the Company has been informed that in the
opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the
Securities Act of 1933 and is therefore unenforceable.
APPENDIX A
----------
WALDEN RESIDENTIAL PROPERTIES, INC.
Dividend Reinvestment and Stock Purchase Plan
1. Definitions
-----------
The following terms when used herein shall have the following
definitions:
"Authorization Card" means such authorization form as the Plan
Agent may from time to time or upon request furnish Stockholders
and which shall be returned to the Plan Agent to indicate their
election to participate in specified portions of the Plan.
"Certificated Shares" means shares of Common Stock which are
evidenced by physical certificates.
"Common Stock" means the common stock, par value $.01 per
share, of the Company.
"Company" means Walden Residential Properties, Inc.
"Market Price" as of any day means the average of the closing
sales prices of the Common Stock on the composite tape of the NYSE
for the five Trading Days immediately preceding the applicable
Reinvestment Date.
"Noncertificated Shares" means shares of Common Stock which
are held by the Plan Agent in an account for each Participant and
for which no physical certificates are issued.
"NYSE" means the New York Stock Exchange, Inc.
"Participant" means any Stockholder who has returned a
properly completed Authorization Card to the Plan Agent indicating
election to participate in any portion of the Plan and who has been
enrolled in that portion of the Plan by the Plan Agent.
"Plan" means this Dividend Reinvestment and Stock Purchase
Plan.
"Plan Agent" means any bank or trust company as from time to
time may be appointed by the Company as agent to administer the
Plan. Initially, the Plan Agent shall be Boston EquiServe, L.P.
and thereafter shall be the Company or any successor institution
appointed by the Company in substitution therefor.
"Preferred Stock" means the preferred stock, par value $.01
per share, of the Company.
"Reinvestment Date" means each date on which a dividend is
paid on the shares of Common Stock, which payment date the Company
anticipates to be in March, June, September and December each year,
unless such payment date is not a Trading Day, in which case the
Reinvestment Date shall be the next succeeding Trading Day.
"Stockholder" means any holder of shares of Common Stock
and/or Preferred Stock.
"Trading Day" means a day on which the NYSE is open for
trading.
2. Purpose
-------
The purpose of this Plan is to provide Stockholders with a
convenient and economical method for having all or part of their
dividends automatically reinvested in additional shares of Common
Stock and making voluntary cash investments in shares of Common
Stock, in either case without payment of any brokerage commission
or service charge. Because shares of Common Stock will be
purchased for the Plan directly from the Company by the Plan Agent,
the Plan will assist the Company in raising funds for general
business purposes. The Plan does not reflect a change in the
Company's dividend policy or a guarantee of future dividends, which
will continue to be determined by the Board of Directors based on
the Company's results of operations, financial condition,
regulatory requirements and other factors.
3. Eligibility for Participation
-----------------------------
All Stockholders of record are automatically eligible to
participate in the Plan and may do so by completing and returning
to the Plan Agent the Authorization Card furnished to them by the
Plan Agent. Beneficial owners of shares of Common Stock and/or
Preferred Stock which are registered in names other than their own
(e.g., in the name of a broker, bank nominee or other record
holder), who want to participate, must either (a) make appropriate
arrangements to have their broker, bank nominee or other record
holder participate in the Plan (b) or have their shares of Common
Stock and/or Preferred Stock transferred into their own names.
Only record holders may participate in the optional cash payment
feature of the Plan. The Company reserves the right to refuse to
permit a broker, bank nominee or other record holder to participate
in the Plan if the terms of such participation would, in the
Company's sole judgment, result in excessive cost or burden on the
Company.
4. Administration of the Plan
--------------------------
The Plan Agent shall administer the Plan and will maintain
records and perform such other duties as may be required. In
addition, the Plan Agent will send each Participant (a) after each
dividend reinvestment, a statement which will indicate the amount
of the dividend, the purchase price per share of Common Stock, the
number of shares of Common Stock purchased and the total number of
Noncertificated Shares owned by the Participant; (b) upon
investment of optional cash payments, a statement indicating
purchase price, number of shares of Common Stock purchased, and the
total number of Certificated and Noncertificated Shares owned by
the Participant; and (c) annual and quarterly reports to holders of
Common Stock, proxy statements and income tax information for
reporting dividends earned. Shares of Common Stock purchased by a
Participant through reinvested dividends or optional cash payments
will be credited to the Participant's Noncertificated Share
account. Upon request of a Participant, the Plan Agent will
furnish certificates for shares of Common Stock in the
Participant's Noncertificated Share account. No certificates will
be issued for fractional shares of Common Stock, but the Market
Price thereof will be paid in cash to a requesting Stockholder.
The Plan Agent will have the responsibility for furnishing
certificates for shares of Common Stock upon request or termination
of participation by the Stockholder.
5. Reinvestment of Dividends
-------------------------
Stockholders may join the Plan at any time. Stockholders may
elect to have dividends on all or part of their shares of Common
Stock and/or Preferred Stock automatically reinvested by completing
the Authorization Card provided by the Plan Agent to that effect
and returning it to the Plan Agent. If the Authorization Card is
received by the Plan Agent on or before the record date for the
payment of the next dividend, reinvestment will begin with that
dividend. If the Authorization Card is received in the period
between any dividend record date and the applicable Reinvestment
Date, that dividend will be paid in cash and the stockholder's
initial dividend reinvestment will being with the next dividend.
The purchase price per share for shares of Common Stock purchased
for the Plan with reinvested dividends shall be 95% of the Market
Price. Cash dividends on shares of Common Stock credited to the
Participant's account will be automatically reinvested to purchase
additional shares of Common Stock.
6. Optional Cash Payments
----------------------
Stockholders may acquire additional shares of Stock by making
optional cash payments of not less than $100 nor more than $25,000
in the aggregate per calendar quarter. Shares of Common Stock
purchased with optional cash payments will be held by the Plan
Agent and credited to a Participant's Noncertificated Share
account. Thereafter, dividends on such shares of Common Stock will
automatically be fully reinvested in additional shares of Common
Stock unless such shares are withdrawn from the Plan. Optional
cash payments received by the Plan Agent not more than thirty (30)
calendar days nor less than three (3) business days prior to an
applicable Reinvestment Date will be invested on the applicable
Reinvestment Date. No interest will be paid on funds received and
held for the purchase of shares of Common Stock under the Plan.
The purchase price per share for shares of Stock purchased for the
Plan with optional cash payments shall be 97% of the Market Price.
7. Calculation of Shares of Common Stock Purchased
-----------------------------------------------
The number of shares of Common Stock purchased shall be
determined by dividing the amount of the dividends reinvested
and/or optional cash payments made by the purchase price per share
of Common Stock determined in accordance with Sections 5 and 6
above. Each Participant's account will be credited on each
Reinvestment Date with that number of shares of Common Stock, plus
fractional share interests computed to three (3) decimal points,
equal to the total amount of the cash (dividends and/or optional
cash payments) to be invested on behalf of such Participant on such
date divided by the purchase price per share of Common Stock for
that date.
8. Costs
-----
There are no brokerage fees on purchases. All costs of
administration of the Plan are paid by the Company, except that
Participants may incur certain costs in connection with their
withdrawal from the Plan if they direct the Plan Agent to sell
their shares of Common Stock.
9. Source of Common Stock
----------------------
Shares of Common Stock purchased under the Plan come from the
legally authorized but unissued shares of Common Stock of the
Company. Shares of Common Stock will not be purchased in the open
market.
10. Modification or Termination of Participation
--------------------------------------------
Participants may modify their participation in the Plan by
notifying the Plan Agent in writing that they wish to reinvest
dividends on an increased or decreased number of shares of Common
Stock and/or Preferred Stock specified in such notice.
Participants may terminate participation in the Plan any time by
notifying the Plan Agent in writing to that effect. Any notice is
effective only upon receipt. If a Participant's notice of
termination or modification is received by the Plan Agent at least
three (3) business days prior to the record date for determining
the Stockholders entitled to receive the next dividend payment, the
Plan Agent will modify or terminate the reinvestment of the
Participant's dividends under the Plan as of that Reinvestment
Date. If the notice of termination or modification is received by
the Plan Agent on or after two (2) business days prior to the
record date for the next dividend, that dividend will be reinvested
in shares of Common Stock for the Participant in accordance with
the Participant's previous instructions, and the request for
termination or modification will be processed promptly thereafter.
Any optional early payments sent to the Plan Agent prior to receipt
of the notice of termination or modification will also be invested
in shares of Common Stock on the next Reinvestment Date unless the
Participant requests in writing to the Plan Agent the return of all
or a portion of such optional cash payments at least three (3)
business days prior to the applicable Reinvestment Date. In order
to re-enter the Plan after termination, the Stockholder must
complete a new Authorization Card.
11. Sale of Plan Shares
-------------------
A Participant can instruct the Plan Agent to sell any or all
of the whole shares of Common Stock held in the Plan. The written
notification to the Plan Agent should include the number of shares
of Common Stock that are to be sold. The Plan Agent will make the
sale as soon as practicable following receipt of the written
notification and a check for the proceeds less brokerage commission
and transfer taxes (if any) will usually be sent by the Plan Agent
to the Participant on the settlement date, which will be three (3)
business days from the date of sale. No Participant shall have the
authority or power to direct the date or sales price at which
shares of Common Stock may be sold. Requests must indicate the
minimum number of shares of Common Stock to be sold and not the
dollar amount to be attained. Any such request that does not
clearly indicate the number of shares of Common Stock will be
returned to the Participant with no action taken. A
withdrawal/termination form is provided on the reverse side of the
account statement for this purpose. This notice should be
addressed to Boston EquiServe, L.P., P. O. Box 8040, Mail Stop
45-02-09, Boston, MA 02266-8040. Shares of Common Stock held in
a Participant's account may not be pledged. In order to pledge
such shares, a Participant must request certificates for such
shares of Common Stock.
12. Certificates for Purchased Shares of Common Stock
-------------------------------------------------
No certificates for shares of Common Stock acquired for a
Participant under the Plan will be issued. Common Stock purchased
under the Plan will be credited to a Participant's Noncertificated
Share account and will be held in the name of the Plan Agent or its
nominee. A Participant who wishes to obtain certificates for those
shares of Common Stock that he has purchased under the Plan may do
so by notifying the Plan Agent in writing to that effect. No
certificate will be issued for fractional shares of Common Stock,
but the Market Price of any fractional shares of Common Stock will
be paid in cash to the Participant requesting a certificate for all
his Noncertificated Shares.
13. Stock Splits, Stock Dividends and Rights Offerings
--------------------------------------------------
Shares of Common Stock issued in a stock dividend or stock
split with respect to a Participant's shares of Common Stock which
are subject to the Plan will be credited to a Participant's
Noncertificated Share account. If the Company has a rights
offering in which separately tradable and exercisable rights are
issued to registered holders of Common Stock, the rights
attributable to whole shares of Common Stock held in a
Participant's Plan account will be transferred to the Participant
as promptly as practicable after the rights are issued. No partial
rights will be issued with respect to fractional shares of Common
Stock in the Participant's account.
14. Voting
------
All shares of Common Stock credited to a Participant's
Noncertificated Share account under the Plan may be voted by the
Participant. A participant will receive a proxy to vote the number
of shares of Common Stock held in his Plan account. The shares of
Common Stock held in a Participant's Plan account may only be voted
by proxy and not in person at the meeting. If the Participant
returns an executed proxy, it will be voted with respect to all of
Participant's shares of Common Stock (including any fractional
shares of Common Stock), or the Participant may vote all of the
shares of Common Stock in person at the meeting.
15. Liability
---------
Neither the Company, nor its duly appointed Plan Agent (if
any) in administering the Plan, shall be liable for any act or
failure to act taken in good faith, including, without limitation,
any claim of liability arising out of failure to terminate a
Participant's participation in the Plan upon the Participant's
death. In addition, no Stockholder, director, officer, employee,
representative or agent of the Company shall be personally liable
for the satisfaction of the Company's obligations under the Plan
and a Participant shall look solely to the assets of the Company
for satisfaction of any claims hereunder.
16. Termination, Suspension or Modification
---------------------------------------
The Company reserves the right to modify, suspend or terminate
the Plan at any time and from time to time, including during the
period between the record date for a dividend payment and the
related Reinvestment Date, and in particular, reserves the right to
refuse optional cash payments from any Stockholder who, in the sole
discretion of the Company, is attempting to circumvent the intent
of the Plan by making excessive optional cash payments through
multiple Stockholder accounts. The Company may also suspend,
terminate or refuse participation in the Plan to any Stockholder
if, participation or any increase in the number of shares of Common
Stock held by such Stockholder, would, in the opinion of the Board
of Directors of the Company jeopardize the status of the Company as
a real estate investment trust.
17. Compliance with Applicable Law and Regulations
----------------------------------------------
The Company's obligation to offer, issue or sell shares of
Common Stock hereunder shall be subject to the Company's obtaining
any necessary approval, authorization and consent from any
regulatory authorities having jurisdiction over the issuance and
sale of the shares of Common Stock. The Company may elect not to
offer or sell its shares of Common Stock hereunder to Stockholders
residing in any jurisdiction where, in the sole discretion of the
Company, the burden or expense of compliance with applicable blue
sky or securities laws make that offer or sale impracticable or
inadvisable.
18. Participants Subject to Back-Up Withholding
-------------------------------------------
In the case of both foreign participants who elect to have
their dividends reinvested and whose dividends are subject to
United States income tax withholding and other Participants who
elect to have their dividends reinvested and who are subject to
"backup" withholding under Section 3406(a)(1) of the Internal
Revenue Code of 1986, as amended, the Plan Agent shall invest in
shares of Common Stock in an amount equal to the dividends of such
Participants less the amount of tax required to be withheld.
19. Safekeeping
-----------
At a Participant's request, the Plan Agent will receive and
hold any Certificated Shares now held by or for such Participant.
A Participant may send such Certificated Shares to the Plan Agent
for credit to such Participant's account in the Plan. These
Certificated Shares will be added to the shares of Common Stock in
such Participant's account and will appear in subsequent statements
in combination with a Participant's previous Plan shares of Common
Stock and dividends. If a Participant is interested in having the
Plan Agent hold shares of Common Stock now in such Participant's
possession, write for further information to:
Boston EquiServe, L.P.
P. O. Box 8040
Mail Stop 45-02-09
Boston, Massachusetts 02266-8040
No person has been 1,000,000 Shares
authorized to give any
information or to make any
representations other than those
contained herein and, if given or Walden Residential
made, such information or Properties, Inc.
representations must not be
relied upon as having been
authorized by the Company. This Common Stock
Prospectus does not constitute an Offered by Walden Residential
offer to sell, or a solicitation Properties, Inc. to its Stockholders
of an offer to buy, the Solely in Connection with its
securities offered hereby in any Dividend Reinvestment and
jurisdiction to any person to Stock Purchase Plan
whom it is unlawful to make an
offer or solicitation. Neither
the delivery of this Prospectus
nor any sale made hereunder
shall, under any circumstances,
create an implication that there
has not been any change in the
facts set forth in this
Prospectus or in the affairs of
the Company since the date
hereof.
_______________
TABLE OF CONTENTS
Page
Available Information . . . . . . . . . .2 ----------------
Incorporation of Certain
Documents by Reference. . . . . . . . . .2 PROSPECTUS
The Company . . . . . . . . . . . . . . .4
Description of the Plan . . . . . . . . .5 ----------------
Use of Proceeds . . . . . . . . . . . . 14
Legal Matters . . . . . . . . . . . . . 14
Experts . . . . . . . . . . . . . . . . 14 August 27, 1997
Indemnification of Directors
and Officers . . . . . . . . . . . . . 15
Dividend Reinvestment and Stock
Purchase Plan. . . . . . . . . . . . .A-1
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
--------------------------------------------
The estimated expenses expected to be paid by the Company in
connection with the issuance and distribution of the securities
being registered are as follows:
SEC Registration Fee. . . . . . . . . . $ 7,197
Legal Fees and Expenses . . . . . . . . 10,000
Accountant's Fees and Expenses. . . . . 5,000
Miscellaneous Expenses. . . . . . . . . 2,803
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Total . . . . . . . . . . . . . . . $25,000
=======
Item 15. Indemnification of Directors and Officers.
------------------------------------------
The Company's Articles of Incorporation, as amended and
restated (the "Articles of Incorporation"), provide certain
limitations on the liability of the Company's directors and
officers for monetary damages to the Company. The Articles of
Incorporation obligate the Company to indemnify its directors and
officers, and permit the Company to indemnify its employees and
other agents, against certain liabilities incurred in connection
with their service in such capacities. These provisions could
reduce the legal remedies available to the Company and the
stockholders against these individuals.
The Articles of Incorporation require it to indemnify (a) the
Company's directors and officers whether serving the Company or at
its request any other entity who have been successful, on the
merits or otherwise, in the defense of a proceeding to which he was
made a party by reason of his service in that capacity against
reasonable expenses incurred by him in connection with the
proceeding unless it is established that (i) his act or omission
was material to the matter giving rise to the proceeding and was
committed in bad faith or was the result of active and deliberate
dishonesty, (ii) he actually received an improper personal benefit
in money, property or services, or (iii) in the case of a criminal
proceeding, he had reasonable cause to believe that his act or
omission was unlawful and (b) other employees of the Company and
agents of the Company to such extent as shall be authorized by the
Board of Directors of the Company or the Company's Bylaws and be
permitted by law. In addition, the Articles of Incorporation
require the Company to pay or reimburse, in advance of the final
disposition of a proceeding, reasonable expenses incurred by a
director or officer who is a party to a proceeding under procedures
provided for under the Maryland General Corporation Law (the
"MGCL"). The Company's Bylaws also permit the Company to provide
such other and further indemnification or payment or reimbursement
of expenses as the Board of Directors of the Company deems to be in
the interest of the Company and as may be permitted by the MGCL for
directors, officers and employees of Maryland corporations.
The Company has entered into indemnification agreements with
each of the Company's officers and directors. The indemnification
agreements require, among other things, that the Company indemnify
its officers and directors to the fullest extent permitted by law
and advance to the officers and directors all related expenses,
subject to reimbursement if it is subsequently determined that
indemnification is not permitted. The Company must also indemnify
and advance all expenses incurred by officers and directors seeking
to enforce their rights under the indemnification agreements and
cover officers and directors under the Company's directors' and
officers' liability insurance. Although the indemnification
agreements offer substantially the same scope of coverage afforded
by law, they provide assurance to directors and officers that
indemnification will be available because such contracts cannot be
modified unilaterally in the future by the Board of Directors of
the Company or the stockholders to eliminate the rights they
provide.
Item 16. Exhibits
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4.1 Specimen of Stock Certificate *
5.1 Opinion of Winstead Sechrest & Minick P.C. regarding the
legality of the Common Stock
10.1 Dividend Reinvestment and Stock Purchase Plan (attached hereto
and made a part hereof)
23.1 Consent of Deloitte & Touche LLP
23.2 Consent of Winstead Sechrest & Minick P.C. (included in
Exhibit 5.1)
24.1 Power of Attorney (included on signature page)
________________
* Incorporated by reference to Exhibit 4.1 and the Company's
Registration Statement on Form S-3 (Registration No. 33-90438)
Item 17. Undertakings.
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The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales
are being made, 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;
(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 such
information in the registration statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not
apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in
periodic reports filed by the Company pursuant to section 13 or
section 15(d) of the Securities Exchange Act of 1934, that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability
under the Securities Act, each such post-effective amendment
shall be deemed to be a new registration statement relating to
the securities offered therein, and the offering of such
securities at that time shall 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 Section 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 the
registration statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
SIGNATURES
Pursuant to the requirements of the Securities Act, 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
Dallas, State of Texas, on August 26, 1997.
WALDEN RESIDENTIAL PROPERTIES, INC.,
a Maryland corporation
By: /s/ Don R. Daseke
-----------------
Don R. Daseke
Chief Executive Officer and
Chairman of the Board of Directors
KNOW ALL MEN BY THESE PRESENTS, that each person whose
signature appears below hereby constitutes and appoints Don R.
Daseke or Mark S. Dillinger or either of them, his or her
attorneys-in-fact and agents, each with full power of substitution
and resubstitution for him or her in any and all capacities, to
sign any or all amendments or post-effective amendments to this
Registration Statement, and to file the same, with exhibits thereto
and other documents in connection therewith with the Commission,
granting unto each of such attorneys-in-fact and agents full power
and authority to do and perform each and every act and thing
requisite and necessary in connection with such matters and hereby
ratifying and confirming all that each of such attorneys-in-fact
and agents or his substitutes may do or cause to be done by virtue
hereof.
Pursuant to the requirements of the Securities Act, this
Registration Statement has been signed by the following persons in
the capacities and on the dates indicated.
Signature Title Date
- --------- ----- ----
/s/ Don R. Daseke Chairman of the Board of Directors, August 26, 1997
- ----------------------- Chief Executive Officer and
Don R. Daseke Director (Principal Executive
Officer)
/s/ Mark S. Dillinger Executive Vice President, Chief August 26, 1997
- ----------------------- Financial Officer and Director
Mark S. Dillinger (Principal Financial and Accounting
Officer)
/s/ Marshall B. Edwards President, Chief Acquisitions August 26, 1997
- ----------------------- Officer and Director
Marshall B. Edwards
/s/ Linda Walker Bynoe Director August 26, 1997
- -----------------------
Linda Walker Bynoe
/s/ Francesco Galesi Director August 26, 1997
- -----------------------
Francesco Galesi
/s/ Arch K. Jacobson Director August 26, 1997
- -----------------------
Arch K. Jacobson
/s/ Louis G. Munin Director August 26, 1997
- -----------------------
Louis G. Munin
/s/ J. Otis Winters Director August 26, 1997
- -----------------------
J. Otis Winters
EXHIBIT 5.1
WINSTEAD SECHREST & MINICK P.C.
5400 Renaissance Tower
1201 Elm Street
Dallas, Texas 75270
Direct Dial: (214) 745-5724
[email protected]
August 26, 1997
Walden Residential Properties, Inc.
One Lincoln Centre
5400 LBJ Freeway
Suite 400
Dallas, Texas 75240
Gentlemen:
We have acted as counsel to Walden Residential Properties,
Inc., a Maryland corporation (the "Company"), in connection with
the registration under the Securities Act of 1933, as amended (the
"Securities Act"), of 1,000,000 shares of the common stock, par
value $.01 per share (the "Shares"), to be issued pursuant to the
Company's Dividend Reinvestment and Stock Purchase Plan (the
"Plan"). In connection with such representation, we have examined
such documents, records and matters of law as we have deemed
necessary for purposes of this opinion. Based upon such
examination, we are of the opinion that the Shares are duly and
validly authorized and, when sold in exchange for the
consideration, and upon the terms and conditions, as provided for
in the Plan, will be legally issued, fully-paid and non-assessable.
Our opinion is limited in all respects to the substantive laws
of the State of Texas and the federal law of the United States and
we assume no responsibility as to the applicability thereto, or the
effect thereon, of the laws of any other jurisdiction. To the
extent the opinions set forth herein are governed by the laws of
the State of Maryland, our opinion is based solely on our review of
Maryland General Corporation Law.
We hereby consent to the filing of this opinion as an exhibit
to the Registration Statement and to the reference to us under the
heading "Legal Matters" in the Prospectus contained therein. In
giving our consent, we do not thereby admit that we are in the
category of persons whose consent is required under Section 7 of
the Securities Act or the rules and regulations of the Commission
thereunder.
Very truly yours,
WINSTEAD SECHREST & MINICK P.C.
By: /s/ Kenneth L. Betts
--------------------
Kenneth L. Betts
KLB:dds
Exhibit 23.1
INDEPENDENT AUDITOR'S CONSENT
We consent to the incorporation by reference in the
Registration Statement on Form S-3 of Walden Residential
Properties, Inc. and in the related prospectus of our report dated
March 3, 1997 (which expresses an unqualified opinion and includes
an explanatory paragraph relating to a change in the method of
accounting for the cost of replacement carpets as disclosed in Note
2), with respect to the consolidated financial statements and
schedule of Walden Residential Properties, Inc. included in the
Annual Report on Form 10-K for the year ended December 31, 1996;
our report dated March 3, 1995, with respect to the combined
financial statements of Walden Predecessors, included in the Annual
Report on Form 10-K for the year ended December 31, 1996; and our
report dated April 18, 1997, with respect to the combined statement
of revenues and certain expenses (defined as being operating
revenues less direct operating expenses) of Arbor Park, Arbors of
Bedford, Arbors of Carrollton, Arbors of Euless, Arbors of Forest
Lane and Arbors of Austin ("Arbors Apartments") for the year ended
December 31, 1996, included in the Current Report on Form 8-K of
Walden Residential Properties, Inc. dated April 21, 1997.
/s/ Deloitte & Touche LLP
- -------------------------
DELOITTE & TOUCHE LLP
Dallas, Texas
August 27, 1997
