UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
Quarterly Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the Quarterly Period Ended June 30, 1998
Commission File Number 1-12784
AMLI RESIDENTIAL PROPERTIES TRUST
(Exact name of registrant as specified in its charter)
Maryland 36-3925916
(State of Organization) (I.R.S. Employer Identification No.)
125 South Wacker Drive, Suite 3100,
Chicago, Illinois 60606
(Address of principal executive office) (Zip code)
Registrant's telephone number, including area code: (312) 443-1477
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months and (2) has been subject to such
filing requirements for the past 90 days. Yes ( X ) No ( )
The number of the Registrant's Common Shares of Beneficial Interest
outstanding was 16,624,040 as of June 30, 1998.
<PAGE>
INDEX
PART I: FINANCIAL INFORMATION
Item 1: Financial Statements (Unaudited)
Consolidated Balance Sheets as of
June 30, 1998 and December 31, 1997 . . . . . . . . 3
Consolidated Statements of Operations
for the three and six months ended
June 30, 1998 and 1997. . . . . . . . . . . . . . . 5
Consolidated Statements of
Shareholders' Equity
for the six months ended
June 30, 1998 . . . . . . . . . . . . . . . . . . . 7
Consolidated Statements of Cash Flows
for the six months ended
June 30, 1998 and 1997. . . . . . . . . . . . . . . 8
Notes to Consolidated Financial Statements. . . . . . 10
Item 2: Management's Discussion and
Analysis of Financial Condition and
Results of Operations . . . . . . . . . . . . . . . 24
Item 3: Quantitative and Qualitative Disclosures
About Market Risk . . . . . . . . . . . . . . . . . 30
PART II: OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K. . . . . . . . . . . 34
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS
JUNE 30, 1998 AND DECEMBER 31, 1997
(UNAUDITED)
(Dollars in thousands, except share data)
<CAPTION>
JUNE 30, DECEMBER 31,
1998 1997
------------- ------------
<S> <C> <C>
ASSETS:
Rental apartments:
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 83,471 78,476
Depreciable property . . . . . . . . . . . . . . . . . . . . . . . . . . 532,706 496,747
---------- ----------
616,177 575,223
Less accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . (71,159) (62,641)
---------- ----------
545,018 512,582
Property under development . . . . . . . . . . . . . . . . . . . . . . . . 74,594 78,724
Investments in partnerships. . . . . . . . . . . . . . . . . . . . . . . . 60,604 50,729
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . . . . 3,120 5,676
Security deposits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,779 1,821
Deferred expenses, net . . . . . . . . . . . . . . . . . . . . . . . . . . 3,098 3,140
Notes receivable from and advances to Service Companies. . . . . . . . . . 23,475 18,356
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 8,950
---------- ----------
Total Assets $ 721,688 679,978
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY:
LIABILITIES:
Debt (note 5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 337,108 333,250
Accrued interest payable . . . . . . . . . . . . . . . . . . . . . . . . . 1,359 1,389
Accrued real estate taxes payable. . . . . . . . . . . . . . . . . . . . . 7,863 9,334
Construction costs payable . . . . . . . . . . . . . . . . . . . . . . . . 3,065 8,403
Security deposits and prepaid rents. . . . . . . . . . . . . . . . . . . . 2,992 2,722
Other liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,065 2,978
---------- ----------
Total liabilities. . . . . . . . . . . . . . . . . . . . . . . . 354,452 358,076
---------- ----------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED BALANCE SHEETS - CONTINUED
JUNE 30, DECEMBER 31,
1998 1997
------------- ------------
Commitments and contingencies (note 6)
Minority interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49,731 51,463
---------- ----------
SHAREHOLDERS' EQUITY:
Series A Cumulative Convertible Preferred shares of beneficial interest,
$.01 par value,
1,500,000 authorized, 1,200,000 issued and
1,100,000 outstanding (aggregate liquidation price of $22,223
and $22,213 respectively) . . . . . . . . . . . . . . . . . . . . . . . 11 11
Series B Cumulative Convertible Preferred shares of beneficial interest,
$0.01 par value, 3,125,000 authorized, 2,083,333 issued and outstanding
(aggregate liquidation price of $50,474 at June 30, 1998) . . . . . . . . 21 --
Shares of beneficial interest, $.01 par value, 145,375,000
authorized, 16,624,040 and 16,577,580 common shares issued
and outstanding, respectively. . . . . . . . . . . . . . . . . . . . . . 166 166
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . 392,475 341,148
Employees and trustees notes . . . . . . . . . . . . . . . . . . . . . . . (7,417) (6,924)
Retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30,804 18,897
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (98,555) (82,859)
---------- ----------
Total shareholders' equity . . . . . . . . . . . . . . . . . . . 317,505 270,439
---------- ----------
Total Liabilities and Shareholders' Equity . . . . . . . . . . . $ 721,688 679,978
========== ==========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS
THREE AND SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
(Dollars in thousands, except share data)
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
------------------------ ------------------------
1998 1997 1998 1997
--------- -------- --------- --------
<S> <C> <C> <C> <C>
Revenues:
Property:
Rental . . . . . . . . . . . . . . . . . . . . $25,204 19,281 49,342 37,961
Other. . . . . . . . . . . . . . . . . . . . . 1,456 1,019 2,748 1,994
Interest and share of income
from Service Companies. . . . . . . . . . . . . 630 253 1,059 517
Other interest . . . . . . . . . . . . . . . . . 223 120 414 227
Income from partnerships . . . . . . . . . . . . 499 166 823 333
Other. . . . . . . . . . . . . . . . . . . . . . 1,297 474 1,585 1,131
-------- -------- -------- --------
Total revenues . . . . . . . . . . . . . 29,309 21,313 55,971 42,163
-------- -------- -------- --------
Expenses:
Personnel. . . . . . . . . . . . . . . . . . . . 2,529 1,822 4,846 3,545
Advertising and promotion. . . . . . . . . . . . 796 482 1,504 989
Utilities. . . . . . . . . . . . . . . . . . . . 1,059 909 2,144 1,934
Building repairs and maintenance and services. . 1,490 1,407 2,745 2,563
Landscaping and grounds maintenance. . . . . . . 648 515 1,090 879
Real estate taxes. . . . . . . . . . . . . . . . 3,274 2,312 6,454 4,634
Insurance. . . . . . . . . . . . . . . . . . . . 251 200 472 398
Property management fees . . . . . . . . . . . . 667 517 1,305 1,008
Other operating expenses . . . . . . . . . . . . 387 236 731 511
Interest . . . . . . . . . . . . . . . . . . . . 4,800 2,886 9,738 5,532
Amortization of deferred costs . . . . . . . . . 118 87 248 330
Depreciation . . . . . . . . . . . . . . . . . . 4,488 3,196 8,779 6,253
General and administrative . . . . . . . . . . . 1,112 706 1,966 1,473
-------- -------- -------- --------
Total expenses . . . . . . . . . . . . . 21,619 15,275 42,022 30,049
-------- -------- -------- --------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF OPERATIONS - CONTINUED
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30 JUNE 30
------------------------ ------------------------
1998 1997 1998 1997
--------- -------- --------- --------
Income before minority interest and
extraordinary item . . . . . . . . . . . . . . . 7,690 6,038 13,949 12,114
Minority interest. . . . . . . . . . . . . . . . . 1,109 958 2,042 1,911
-------- -------- -------- --------
Income before extraordinary item . . . . . . . . . 6,581 5,080 11,907 10,203
Extraordinary item -
loss on early extinguishment of debt
(net of minority interest) . . . . . . . . . . . -- 177 -- 177
-------- -------- -------- --------
Net income . . . . . . . . . . . . . . . 6,581 4,903 11,907 10,026
Less income attributable preferred shares. . . . . 958 473 1,562 946
-------- -------- -------- --------
Net income attributable to
common shares. . . . . . . . . . . . . $ 5,623 4,430 10,345 9,080
======== ======== ======== ========
Net income per common share:
Before extraordinary item. . . . . . . . . . . . $ .34 .31 .62 .62
Extraordinary item . . . . . . . . . . . . . . . $ -- (.01) -- (.01)
Net income per common share. . . . . . . . . . . $ .34 .30 .62 .61
Dividends declared and paid
per common share . . . . . . . . . . . . . . . . $ .44 .43 .88 .86
======== ======== ======== ========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1998
(Dollars in thousands)
<CAPTION>
SHARES OF EMPLOYEES
BENEFICIAL INTEREST ADDITIONAL AND RETAINED
-------------------- PAID-IN TRUSTEES EARNINGS DIVIDENDS
SHARES AMOUNT CAPITAL NOTES (DEFICIT) PAID TOTAL
------- ------ ---------- --------- -------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Balance at
December 31, 1997 . . . . 17,677,580 $177 341,148 (6,924) 18,897 (82,859) 270,439
Shares issued in
connection:
Preferred shares
offering . . . . . . 2,083,333 21 49,459 -- -- -- 49,480
Executive Share
Purchase Plan . . . 37,460 -- 849 -- -- -- 849
Options exercised . . 1,666 -- 34 -- -- -- 34
Employees and
Trustees notes, net. . -- -- -- (493) -- -- (493)
Units converted
to shares. . . . . . . 7,334 -- 150 -- -- -- 150
Reallocation of
minority interest. . . -- -- 835 -- -- -- 835
Net income . . . . . . . -- -- -- -- 11,907 -- 11,907
Dividends paid . . . . . -- -- -- -- -- (15,696) (15,696)
---------- ---- ------- ------- ------- ------- -------
Balance at
June 30, 1998. . . . . . 19,807,373 $198 392,475 (7,417) 30,804 (98,555) 317,505
========== ==== ======= ======= ======= ======= =======
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1998 AND 1997
(UNAUDITED)
(Dollars in thousands)
<CAPTION>
1998 1997
-------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 11,907 10,026
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization. . . . . . . . . . . . . . . . . . . . . . . 9,027 6,583
Income from partnerships . . . . . . . . . . . . . . . . . . . . . . . . . (823) (333)
(Income) loss from Service Companies . . . . . . . . . . . . . . . . . . . 93 (77)
Loss on early extinguishment of debt . . . . . . . . . . . . . . . . . . . -- 211
Minority interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2,042 1,877
Changes in assets and liabilities:
Increase in deferred costs . . . . . . . . . . . . . . . . . . . . . . . . (211) (272)
Decrease in security deposits. . . . . . . . . . . . . . . . . . . . . . . 42 7
(Increase) decrease in other assets. . . . . . . . . . . . . . . . . . . . (1,735) 970
(Decrease) increase in accrued interest payable. . . . . . . . . . . . . . (30) 55
Decrease in accrued real estate taxes. . . . . . . . . . . . . . . . . . . (1,412) (1,124)
Increase (decrease) in tenant security deposits and prepaid rents. . . . . 270 (534)
Decrease in other liabilities. . . . . . . . . . . . . . . . . . . . . . . (917) (667)
-------- -------
Net cash provided by operating activities. . . . . . . . . . . . . . . 18,253 16,722
-------- -------
Cash flows from investing activities:
Investments in partnerships. . . . . . . . . . . . . . . . . . . . . . . . . . 73 (9,492)
Cash distributions from partnerships . . . . . . . . . . . . . . . . . . . . . 2,212 1,311
Payments from (advances to) affiliates . . . . . . . . . . . . . . . . . . . . (3,794) 1,027
Earnest money deposits . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253 (75)
Capital expenditures - existing properties . . . . . . . . . . . . . . . . . . (1,853) (1,880)
Acquisition properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . (19,139) (11,231)
Properties under development, net of
reimbursable costs from co-investors. . . . . . . . . . . . . . . . . . . . . (28,380) (25,240)
(Decrease) increase in construction costs payable. . . . . . . . . . . . . . . (5,240) 2,767
-------- -------
Net cash used in investing activities. . . . . . . . . . . . . . . . . (55,868) (42,813)
-------- -------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
1998 1997
-------- --------
Cash flows from financing activities:
Debt proceeds, net of financing costs. . . . . . . . . . . . . . . . . . . . . 128,097 79,938
Debt repayments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (124,327) (45,107)
Net proceeds from stock options exercised. . . . . . . . . . . . . . . . . . . 34 --
Proceeds from offering, net of issuance costs. . . . . . . . . . . . . . . . . 49,479 (57)
Net proceeds from Executive Share Purchase Plan. . . . . . . . . . . . . . . . 849 249
Employee notes for stock purchase, net of payments . . . . . . . . . . . . . . (494) (2,493)
Distributions to partners. . . . . . . . . . . . . . . . . . . . . . . . . . . (2,884) (2,561)
Dividends. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (15,695) (13,708)
-------- -------
Net cash provided by financing activities. . . . . . . . . . . . . . . 35,059 16,261
-------- -------
Net decrease in cash and cash equivalents. . . . . . . . . . . . . . . . . . . . (2,556) (9,830)
Cash and cash equivalents at beginning of period . . . . . . . . . . . . . . . . 5,676 10,291
-------- -------
Cash and cash equivalents at end of period . . . . . . . . . . . . . . . . . . . $ 3,120 461
======== =======
Supplemental disclosure of cash flow information:
Cash paid for mortgage and other interest, net of amounts capitalized. . . . . $ 9,768 5,477
======== ========
<FN>
See accompanying notes to consolidated financial statements.
</TABLE>
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
JUNE 30, 1998 AND 1997
(Unaudited)
(Dollars in thousands, except share data)
1. ORGANIZATION AND BASIS OF PRESENTATION
Organization
AMLI Residential Properties Trust (the "Company") commenced
operations upon the completion of its initial public offering on February
15, 1994. In the opinion of management, all adjustments, which include
only normal recurring adjustments necessary to present fairly the financial
position at June 30, 1998 and December 31, 1997 and the results of
operations and cash flows for the periods presented, have been made.
Certain information and note disclosures normally included in the
Company's annual financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted. These
consolidated financial statements should be read in conjunction with the
financial statements and notes thereto included in the Company's December
31, 1997 Annual Report on Form 10-K filed with the Securities and Exchange
Commission. The results for the six months ended June 30, 1998 are not
necessarily indicative of expected results for the entire year.
The consolidated financial statements include the accounts of the
Company and AMLI Residential Properties, L. P. (the "Operating Partnership"
which holds the operating assets of the Company). The Company is the sole
general partner and owns an 86% majority interest in the Operating
Partnership. The limited partners hold Operating Partnership units ("OP
Units") which are convertible into shares of the Company on a one-for-one
basis, subject to certain limitations.
The Company's management has made a number of estimates and
assumptions relating to the reporting of assets and liabilities, disclosure
of contingent assets and liabilities and the reported amounts of revenues
and expenses during the report periods to prepare these financial
statements in conformity with generally accepted accounting principles.
Actual amounts realized or paid could differ from these estimates.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Properties Under Development
Land being planned for development and all apartment homes in a new
community or new phase are reported as "property under development" until
the entire community or new phase is substantially complete and stabilized
(generally 95% occupancy). Upon stabilization, all apartment homes in the
community or new phase are reported as "rental apartments".
Regardless of whether or not 95% occupancy is achieved, a community
or new phase will be reported as "rental apartments" no later than six
months following substantial completion of construction.
At June 30, 1998, the Company's properties under development include
parcels of land in the development planning stage on which physical
construction will commence later this year or in 1999. Properties under
development are as follows:
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
<CAPTION>
NUMBER NUMBER TOTAL
OF OF EXPENDED
COMMUNITY LOCATION ACRES UNITS THRU 6/30/98
- --------- -------- ------ ------ -------------
<S> <C> <C> <C> <C>
Wholly-Owned:
Development Communities:
AMLI on the Parkway (1) Dallas, TX 10 240 $ 12,372
AMLI at Deerfield (2) Plano, TX 18 240 3,549
AMLI at AutumnChase III Carrollton, TX 24 240 13,649
AMLI at Park Creek Gainesville, GA 20 200 10,796
AMLI at Killian Creek Gwinnett County, GA 22 216 3,785
AMLI at Wynnewood (2) Overland Park, KS 20 232 2,259
AMLI at Regents Crest II (2) Overland Park, KS 6 108 1,125
AMLI at Creekside (2) Overland Park, KS 12 224 2,531
AMLI at St. Charles (2) St. Charles, IL 25 400 5,562
--- ----- --------
Total Development Communities 157 2,100 55,628(4)
--- ----- --------
Land Held for Future Development:
AMLI at Bent Tree II Dallas, TX 10 200 1,806
AMLI at Mesa Ridge Ft. Worth, TX 27 520 3,551
AMLI at Clearwater (2) Indianapolis, IN 11 216 2,690
AMLI at Castle Creek (2) Indianapolis, IN 15 276 2,781
AMLI at Lake Houston (2) Houston, TX 15 300 1,972
AMLI at Park Bridge (2) City of Alpharetta, GA 35 352 3,460
AMLI at Fossil Lake (2) Ft. Worth, TX 19 324 2,706
--- ----- --------
Total Land Held for Future Development 132 2,188 18,966
--- ----- --------
Total Wholly-Owned 289 4,288 74,594
--- ----- --------
Co-Investments (Company Ownership Percentage):
AMLI at Fossil Creek (25%) Ft. Worth, TX 19 384 21,042
AMLI at Northwinds (35%) Atlanta, GA 80 800 37,700
AMLI at Wells Branch (25%) (3) Austin, TX 29 576 25,191
AMLI at Oakhurst (25%) (3) Aurora, IL 29 464 25,883
--- ----- --------
Total Co-Investments 157 2,224 109,816(5)
--- ----- --------
Total 446 6,512 $184,410
=== ===== ========
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
<FN>
(1) AMLI on the Parkway was conveyed at cost to a 25%-owned co-investment venture on July 2, 1998.
(2) It is the Company's intention to develop these land parcels in partnership with one or more institutional
investors.
(3) AMLI at Wells Branch and AMLI at Oakhurst were conveyed at cost to a 25%-owned co-investment venture in
June 1998.
(4) Total development costs for the Development Communities is estimated at approximately $153,110.
(5) The total development costs for the Co-investment Development properties is estimated at approximately
$156,000.
</TABLE>
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
Acquisition
The Company's policy is and has been to expense internal property
acquisition costs (i.e., salaries and overhead of acquisition personnel).
This policy is consistent with the recently-issued EITF 97-11 on this
subject, and thus the issuance of EITF 97-11 had no impact on its results
of operations.
Interest Rate Limitation Contracts
The Company has used interest rate caps and swaps to limit its
exposure to increases in interest rates on its floating rate debt. The
Company does not use them for trading purposes.
At June 30, 1998, the Company was a party to various interest rate
swap agreements which require the Company to pay to or receive from
counterparties on a monthly basis the amounts, if any, by which the
Company's interest costs on the fixed rate basis differs from the interest
payments required on certain floating rate debt.
The following table summarizes certain information pursuant to
interest rate limitation and swap contracts at June 30, 1998.
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
<CAPTION>
Type Remaining Cumulative Approximate
Notional Fixed of Contract Cash Value of
Amount Rate(1) Contract Maturity Paid Liability(2)
- -------- ------- -------- --------- ---------- -------------
<S> <C> <C> <C> <C> <C>
$10,000 6.216% Swap 11/01/02 $ 29 193
10,000 6.029% Swap 11/01/02 18 120
20,000 6.145% Swap 02/15/03 32 344
10,000 6.070% Swap 02/18/03 14 142
---- ----
$ 93 799
==== ====
<FN>
(1) The fixed rate for the swaps includes the swap spread (the risk component added to the Treasury yield to
determine a fixed rate; excludes lender's spread).
(2) "Value of Liability" represents the approximate amount which would have to be paid as of June 30, 1998 to
terminate these contracts. This amount is not recorded as a liability in the accompanying balance sheet as of
June 30, 1998.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
PER SHARE DATA
Earnings per share, basic and diluted, are calculated based on weighted average common shares outstanding for the
three months and six months ended June 30, 1998 and 1997.
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------------- -------------------------
1998 1997 1998 1997
---------- ----------- ---------- ----------
<S> <S> <S> <S> <S>
Net income . . . . . . . . . . . . . . . . $ 6,581 4,903 11,907 10,026
Less income attributable to
preferred shares . . . . . . . . . . . . (958) (473) (1,562) (946)
---------- ---------- ---------- ----------
Net income attributable to common shares . $ 5,623 4,430 10,345 9,080
========== ========== ========== ==========
Weighted average common shares - Basic . . 16,619,783 14,864,800 16,605,921 14,842,247
Dilutive Options and Other Plan shares . . 73,154 75,856 83,616 88,369
Weighted average common shares - Dilutive. 16,692,937 14,940,656 16,689,537 14,930,616
========== ========== ========== ==========
Earnings per share - Basic . . . . . . . . $ .34 .30 .62 .61
Earnings per share - Diluted . . . . . . . $ .34 .30 .62 .61
========== ========== ========== ==========
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
3. INVESTMENTS IN PARTNERSHIPS AND SERVICE COMPANIES
INVESTMENTS IN PARTNERSHIPS
At June 30, 1998, the Operating Partnership is a general partner in various co-investment partnerships and in
the GP Properties (AMLI at Prairie Court in Oak Park, Illinois and AMLI at Towne Creek in Gainesville, Georgia)
which are accounted for using the equity method. The Operating Partnership and the Service Companies receive
various fees for services provided to these co-investment partnerships, including development fees, construction
fees, acquisition fees, property management fees, asset management fees, administrative fees and disposition fees.
The Operating Partnership is entitled to shares of cash flow or liquidation proceeds in excess of its stated
ownership percentages based on returns to its partners in excess of specified rates. Through June 30, 1998, the
Operating Partnership has received $97 of cash flow in excess of its ownership percentages. Investments in
partnerships at June 30, 1998 and the Company's 1998 share of income or loss from each are summarized as follows:
<CAPTION>
Equity Total Company's
Company's ------------------- Net Share of
Percentage Total Company's Company's Income Net Income
Community Ownership Assets Total Share Investment (Loss) (Loss)
- --------- ---------- ------ ----- --------- ---------- ----- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
AMLI at:
Park Place 25% $ 19,156 6,162 1,541 1,505 163 41
Greenwood Forest 15% 16,747 4,781 717 699 14 2
Champions Park 15% 12,320 3,162 474 474 92 14
Champions Centre 15% 9,498 2,645 397 397 30 4
Windbrooke 15% 16,821 4,819 723 723 16 2
Willeo Creek 30% 14,784 4,563 1,369 1,369 (1) --
Pleasant Hill 40% 26,351 10,555 4,469 4,058 363 145
Barrett Lakes 35% 27,016 9,899 3,465 3,577 332 104
Chevy Chase 33% 43,722 13,325 4,387 4,387 371 127
Willowbrook 40% 36,510 11,303 4,521 4,430 229 92
River Park 40% 14,477 5,624 2,250 2,204 168 67
Fox Valley 25% 24,195 23,611 5,903 6,101 87 22
Fossil Creek 25% 20,957 20,317 5,079 5,177 70 18
Danada Farms 10% 48,291 22,676 2,268 2,258 580 58
Verandah 35% 25,319 7,790 2,741 2,803 113 76
Northwinds 35% 37,508 20,953 7,347 7,260 (42) (11)
Regents Crest 25% 25,550 9,140 2,285 2,286 69 60
Oakhurst North 25% 25,923 22,399 5,600 5,472 (29) (7)
Wells Branch 25% 25,312 24,004 6,001 5,424 37 9
======= ====== ------- ------ === ---
$61,537 60,604 823
======= ====== ===
The Company's original investment in the co-investment partnerships totals $66,454.
</TABLE>
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
The fixed-rate debt financing which has been obtained from various
insurance companies on behalf of these co-investment partnerships is
summarized below:
Total Outstanding Interest
Community Commitment at 6/30/98 Rate Maturity
- --------- ---------- ----------- -------- --------
AMLI at:
Park Place $13,000 12,324 8.21% October 1999
Champions Centre 6,700 6,619 8.93% January 2002
Champions Park 9,500 8,905 7.26% January 2002
Windbrooke 11,500 11,467 9.24% February 2002
Greenwood Forest 11,625 11,616 8.95% May 2002
Chevy Chase 29,767 29,205 6.67% April 2003
Willeo Creek 10,000 9,828 6.77% May 2003
Willowbrook 24,500 24,139 7.785% May 2003
Regents Crest 16,500 16,132 7.50% December 2003
Verandah 16,940 16,940 7.55% April 2004
Danada Farms 24,500 24,500 7.33% March 2007
Pleasant Hill 15,500 15,271 9.15% March 2007
River Park 9,100 8,025 7.75% June 2008
Barrett Lakes 16,680 16,680 8.50% December 2009
Northwinds 33,800 13,063 8.25% October 2010
In general, these loans provide for monthly payments of principal and
interest based on a 25 or 27 year amortization schedule and a balloon
payment at maturity. Loans against newly-completed properties provide for
payments of interest only for an initial period, with principal
amortization commencing generally within two years of completion of
construction and initial lease-up.
Investments in Service Companies
Summarized combined financial information of the Service Companies at and
for the six months ended June 30, 1998 and 1997 follows:
1998 1997
------- -------
Income (1) $ 6,738 4,120
General and adminis-
trative expenses (4,629) (3,041)
------- -------
EBITDA 2,109 1,079
Interest (873) (440)
Depreciation (2) (585) (108)
Income taxes (269) (207)
------- -------
Net income (loss) $ 382 324
======= =======
Total assets $31,533 12,958
======= =======
(1) Net of construction and landscaping costs.
(2) In 1998, includes $334 in amortization of goodwill.
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
Substantially all interest expense of the Service Companies results
from notes payable to the Company at interest rates ranging from 9.5% to
13.0%. The Company's share of income (loss) from the Service Companies for
the six months ended June 30, 1998 and 1997 was ($92) and $77,
respectively, after elimination of intercompany profit on construction
activities. The Company's interest income from the Service Companies is
combined with the Company's share of income (loss) from the Service
Companies in the accompanying consolidated statements of operations.
4. RELATED PARTY TRANSACTIONS
During the six months ended June 30, 1998 and 1997, the Company accrued
or paid to its affiliates fees and other costs and expenses as follows:
1998 1997
------ -----
Management fees $1,305 1,008
General contractor fees 827 1,169
Interest expense 287 15
Landscaping and grounds maintenance 335 316
====== =====
In addition, at June 30, 1998 and December 31, 1997, the Company owed
Amrescon $3,065 and $8,403, respectively, for construction costs of
communities under development.
During the six months ended June 30, 1998 and 1997, the Company earned
or received from its affiliates other income as follows:
1998 1997
------ ----
Development fees $1,207 601
Acquisition fees -- 49
Asset management fees 302 304
Debt placement fee -- 88
Accounting and administrative fees 76 8
Interest on advances 117 212
Interest on notes receivable 1,060 228
====== ====
In addition, total revenues of $968 and $494, respectively, were
generated from leases to AMLI Corporate Homes ("ACH"), a division of one of
the Service Companies. At June 30, 1998 and December 31, 1997, $97 and
$624 were due from ACH, respectively.
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
5. DEBT
The table below sets forth certain information relating to the indebtedness of the Company.
<CAPTION>
Balance Balance
Original at Interest Maturity at
Encumbered Communities Amount 6/30/98 Rate Date 12/31/97
- ---------------------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
BOND FINANCING:
Tax-Exempt
Unsecured (1) $ 40,750 40,750 Rate+1.48% 10/1/24 40,750
Tax-Exempt
AMLI at Poplar Creek 9,500 9,500 Rate+1.15% 2/1/24 9,500
-------- ------- -------
Total Bonds 50,250 50,250 50,250
-------- ------- -------
MORTGAGE NOTES PAYABLE TO FINANCIAL INSTITUTIONS:
AMLI at Reflections (2) 4,800 -- 7.05% 6/30/98 4,436
AMLI on Rosemeade 7,050 6,477 7.02% 10/5/98 6,548
AMLI at Sherwood 7,320 6,719 7.75% 7/1/03 6,813
AMLI at Riverbend 31,000 30,102 7.30% 7/1/03 30,349
AMLI in Great Hills 11,000 10,683 7.34% 7/1/03 10,770
AMLI at Valley Ranch 11,500 10,584 7.625% 7/10/03 10,693
AMLI at Conner Farms 13,275 12,854 7.00% 6/15/03 12,965
AMLI at Nantucket 7,735 7,735 7.707% 6/1/04 7,735
AMLI on Timberglen 6,770 6,770 7.70% 6/1/04 6,770
AMLI at Regents Center 20,100 19,736 (3) 9/1/05 19,819
AMLI at Bishop's Gate 15,380 15,202 (4) 8/1/05 15,329
AMLI on the Green (5)
AMLI of North Dallas (5) 43,234 42,087 7.789% 5/1/06 42,383
AMLI at Clairmont 12,880 12,880 6.95% 2/15/08 --
-------- ------- --------
Total Mortgage Notes Payable 192,044 181,829(6) 174,610
-------- ------- --------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
Balance Balance
Original at Interest Maturity at
Encumbered Properties Amount 6/30/98 Rate Date 12/31/97
- --------------------- -------- -------- -------- -------- --------
OTHER NOTES PAYABLE:
AMLI at Park Creek 10,322 8,279 7.875% 12/1/38 2,640
Unsecured line of credit (7)(8) 150,000 90,000 L+1.30% 6/27/01 100,000
Unsecured line of credit 8,000 1,000 L+1.30% 8/30/98 --
Note payable to Service Company 5,000 5,000 9.50% 1/1/03 5,000
Unsecured note payable to Service Company 750 750 4.00% Demand 750
-------- ------- --------- ------- -------
Total Other Notes Payable 174,072 105,029 108,390
-------- ------- -------
Total $416,366 337,108 333,250
======== ======= =======
<FN>
(1) The terms of these tax-exempt bonds require that a portion of the apartment units be leased to individuals
who qualify based on income levels specified by the U.S. Government. The bonds bear interest at a variable rate
that is adjusted weekly based upon the remarketing rate for these bonds (3.55% for Spring Creek and Poplar Creek
at July 29, 1998). The credit enhancement for the Spring Creek bonds was provided by a $41,297 letter of credit
from Wachovia Bank which expires on October 15, 2002 and the credit enhancement for the Poplar Creek bonds was
provided by a $9,617 letter of credit from LaSalle National Bank that expires December 18, 2002.
(2) This loan was repaid on its maturity date.
(3) $13,800 at 8.73% and $6,300 at 9.23%.
(4) This original $14,000 mortgage bears interest at 9.1%. For financial reporting purposes, it was valued at
$15,380 to reflect a 7.25% market rate of interest when assumed in connection with the acquisition of AMLI at
Bishop's Gate on October 17, 1997.
(5) These two properties secure the FNMA loan that was sold at a discount of $673. At June 30, 1998, the
unamortized discount amount is $527.
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(6) All but $21,278 of the total is non-recourse to the partners of the Operating Partnership.
(7) The Company has used interest rate swaps on $50,000 of the outstanding amount to fix its base interest rate
(before current lender's spread) at an average of 6.12%.
(8) The Company's $150,000 unsecured line of credit has been provided by a group of five banks led by Wachovia
Bank, N.A. and the First National Bank of Chicago. The credit agreement provides for annual one-year extensions
and reductions in the interest rate based on the future credit rating the Company is able to obtain. In June
1998, the Company extended the maturity of the line of credit by one year to June 2001. In July 1998, the Company
received a Baa3 credit rating which will reduce the interest rate from LIBOR plus 130 basis points to LIBOR plus
90 basis points. Concurrently, the annual 15 basis points non-use fee will be replaced by an annual 20 basis
points facility fee based on the entire commitment. The commitment under the line of credit was increased to
$200,000 in July, 1998, and a sixth bank was added to the bank lending group. This unsecured line of credit
requires that the Company meet various covenants typical of such an arrangement, including minimum net worth,
minimum debt service coverage and maximum debt to equity percentage. The unsecured line of credit is used for
acquisition and development activities and working capital needs.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
As of June 30, 1998, the scheduled maturities of the Company's debt are as follows:
<CAPTION>
FIXED RATE
MORTGAGE NOTES
NOTES PAYABLE UNSECURED PAYABLE TO
BOND TO FINANCIAL LINES SERVICE
FINANCINGS INSTITUTIONS OF CREDIT COMPANIES TOTAL
---------- ------------- --------- ----------- ----------
<S> <C> <C> <C> <C> <C>
1998 . . . . . . . . . . . . . . . . . $ -- 7,772 1,000 750 9,522
1999 . . . . . . . . . . . . . . . . . -- 2,780 -- -- 2,780
2000 . . . . . . . . . . . . . . . . . -- 3,138 -- -- 3,138
2001 . . . . . . . . . . . . . . . . . -- 3,394 90,000 -- 93,394
2002 . . . . . . . . . . . . . . . . . 50,250 3,655 -- -- 53,905
Thereafter . . . . . . . . . . . . . . -- 169,369 -- 5,000 174,369
------- ------- ------ ------- -------
$50,250 190,108 91,000 5,750 337,108
======= ======= ====== ======= =======
</TABLE>
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
6. COMMITMENTS AND CONTINGENCIES
The limited partnership agreement of AMLI at Verandah L.P. provides for
the redemption (at an amount determined by formula) by the partnership of
the limited partner's entire interest, in the limited partner's sole
discretion, at any time after March 25, 2002, or at any time that there is
a designated event of default on related indebtedness of the partnership,
which event of default remains uncured and unwaived to the time of notice
of redemption election. The redemption amount may be paid in cash or
Company shares of beneficial interest, or any combination thereof, in the
sole discretion of the Company. The original capital contribution made by
the limited partner was $5,525.
On February 20, 1998, the Company placed 3,125,000 Series B cumulative
convertible Preferred Shares with Security Capital Preferred Growth
Incorporated. At June 30, 1998, 2,083,333 Preferred Shares have been
issued. The remaining authorized shares are anticipated to be issued
during September 1998.
7. SUBSEQUENT EVENTS
On July 2, 1998, the Company entered into a partnership with Western and
Southern Life Insurance Company ("Western and Southern") to jointly develop
and own AMLI on the Parkway, a 240-unit residential community located in
Dallas, Texas. Western and Southern contributed $4,188 for a 75% ownership
interest. The Company contributed $1,396 for a 25% interest in the
partnership, and will provide a 8%, $10,591 construction loan, which will
be repaid from proceeds of a permanent loan. The partnership anticipates
securing and closing on the permanent loan by the end of this year.
In July, the Company acquired 23.6 acres of land located in Kansas and
125.5 acres of land located in Indianapolis, Indiana. The Company intends
to develop a 410-unit residential community on the Kansas land either as
wholly-owned or in a co-investment partnership. A multi-phase residential
community will be developed on the Indianapolis parcel and the first phase
will consist of approximately 228 apartment homes.
In early July, Moody's Investors Service has assigned a Baa3 credit
rating to borrowings pursuant to the Company's unsecured line of credit.
As a result, the Company's borrowing rate on this credit facility will be
reduced to 90 basis points over LIBOR. In addition, the credit enhancement
fee for the $40,750 floating rate bonds will also be reduced by 20 basis
points effective October 1, 1998.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS (DOLLARS IN THOUSANDS,
EXCEPT SHARE DATA)
The following discussion is based primarily on the consolidated financial
statements of Amli Residential Properties Trust (the "Company") as of
June 30, 1998 and December 31, 1997 and for the six months ended June 30,
1998 and 1997.
This information should be read in conjunction with the accompanying
unaudited consolidated financial statements and notes thereto. These
financial statements include all adjustments which are, in the opinion of
management, necessary to reflect a fair statement of the results for the
interim periods presented, and all such adjustments are of a normal
recurring nature.
On January 30, 1996, the Company issued 1,200,000 convertible preferred
shares for $20 per share, or $24,000, directly to four institutional
investors and Amli Realty Co. ("ARC") in a registered offering. In
November 1996, the Company completed a public offering of 2,976,900 common
shares. In July 1997, the Company closed on an offering of 1,694,700
common shares. In February 1998, the Company placed 3,125,000 convertible
preferred shares for $24 per share with Security Capital Growth
Incorporated. The net proceeds of the issuance of the preferred shares and
the public offerings were used to reduce the Company's debt and fund
development costs.
As of June 30, 1998, the Company owned an 86% general partnership interest
in the Operating Partnership, which holds the operating assets of the
Company. The limited partners hold Operating Partnership units ("OP
Units") that are convertible into common shares of the Company on a one-
for-one basis, subject to certain limitations. At June 30, 1998, the
Company owned 19,807,373 OP Units and the limited partners owned 3,277,728
OP Units. The Company has qualified, and anticipates continuing to
qualify, as a real estate investment trust ("REIT") for Federal income tax
purposes.
RESULTS OF OPERATIONS
During the period from January 1, 1997 through June 30, 1998, growth in
property revenues and property operating expenses resulted from increases
at communities owned as of January 1, 1997, from communities acquired since
January 1, 1997 and from the newly-constructed communities.
During the same period, the Company has invested in three co-investment
partnerships, which acquired the 600-unit AMLI at Danada in Wheaton,
Illinois, the 538-unit AMLI at Verandah in Arlington, Texas, and the 368-
unit AMLI at Regents Crest in Overland Park, Kansas.
The Company in joint venture with institutional investors, has developed or
has under development five residential communities and began rental
operations during the same period, of the 222-unit AMLI at River Park in
Atlanta, Georgia, the 446-unit AMLI at Barrett Lakes in Cobb County,
Georgia, the 272-unit AMLI at Fox Valley in Aurora, Illinois, the 384-unit
AMLI at Fossil Creek in Fort Worth, Texas and the 800-unit AMLI at
Northwinds in Fulton County, Georgia.
In addition, the Company has acquired three communities in Texas with a
total of 920 apartment homes, two communities in Georgia with 440 apartment
homes and one community each in Indiana and Illinois with a total of 496
apartment homes. During the same period, the Company has developed and
begun rental operations of three new communities and three additional
phases to existing communities that contain a total of 1,096 apartment
homes.
<PAGE>
For the six months ended June 30, 1998, net income attributable to common
shares was $10,345 or $.62 per share on total revenues of $55,971. For the
six months ended June 30, 1997, net income was $9,080 or $.61 per share on
total revenues of $42,163.
On a "same community" basis, weighted average occupancy of the apartment
homes owned wholly by the Company increased slightly to 94.2% for the six
months ended June 30, 1998 from 93.5% in the prior year. Weighted average
collected rental rates increased by 1.8% to $677 from $665 per unit per
month for the six months ended June 30, 1998 and 1997, respectively.
Including Co-Investment Communities, weighted average occupancy of the
Company's apartment homes increased to 94.4% for the six months ended
June 30, 1998 from 93.7% in the prior year, and weighted average collected
rental rates increased by 2.1% to $711 from $697 per unit per month for the
six months ended June 30, 1998 and 1997, respectively.
COMPARISON OF SIX MONTHS ENDED JUNE 30, 1998 TO SIX MONTHS ENDED
JUNE 30, 1997.
Income before minority interest increased to $13,949 for the six months
ended June 30, 1998 from $12,114 for the six months ended June 30, 1997.
This increase was primarily attributable to a $13,808 increase in total
revenues, reduced by a $4,830 increase in property operating expenses, a
$4,206 increase in interest expense and a $2,526 increase in depreciation.
Net income for the six months ended June 30, 1998 and 1997 was $11,907 and
$10,026, respectively.
Total property revenues increased by $12,135, or 30.4%. On the same
community basis total property revenues increased by $1,149, or 3.0%.
Interest and share of income from Service Companies increased 105% from
$517 to $1,059 as a result of additional advances to the Service Companies
to fund the acquisition cost of non-residential land and the cost of
computer hardware and software.
Income from partnerships increased 147% from $333 to $823 as a result of
completion of development and leasing of existing co-investment
partnerships and the formation of new co-investment partnerships.
Other income increased by 40% from $1,131 to $1,585 as a result of
increased fees charged to co-investment development partnerships.
Property operating expenses increased by $4,830, or 29.3%. On the same
community basis, property operating expenses decreased by $381 or 2.5%.
Interest expense, net of the amounts capitalized, increased to $9,738 from
$5,532 or 76.0%, primarily due to increased indebtedness incurred in
conjunction with property acquisition and development.
General and administrative expenses increased to $1,966 for the six months
ended June 30, 1998 from $1,473 for the six months ended June 30, 1997.
The increase is primarily attributable to increased compensation and
compensation-related costs attributable to both additional employees and
increased rates of compensation. In addition, a $100 provision for write
off of predevelopment costs was made for the three and six months ended
June 30, 1998.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1998, the Company had $3,120 in cash and cash equivalents and
$60,000 in availability under its $150,000 unsecured line of credit. On
July 27, 1998, this line of credit was increased to $200,000 and a sixth
bank joined the existing bank group.
<PAGE>
On February 20, 1998, the Company privately placed $75,000 of Series B
cumulative convertible preferred shares with an institutional investor at
$24 per share. The initial funding of $25,000 occurred on March 9, 1998
and the second installment was funded on June 30, 1998. The Company
anticipates funding the final installment in September 1998. Proceeds from
this private placement, net of an estimated 1.05% in offering costs, are
anticipated to aggregate approximately $74,200.
At June 30, 1998, there were seventeen of the Company's wholly-owned
stabilized Communities that are unencumbered. The Company expects to repay
one fixed rate loan aggregating $6,477 at its scheduled 1998 maturity from
additional borrowings under its unsecured line of credit, whereupon one
more Community will be unencumbered. There are no other fixed rate loans
on wholly-owned Communities with maturity dates prior to June 2003.
Net cash flows provided by operating activities for the six months ended
June 30, 1998 increased to $18,253 from $16,722 for the six months ended
June 30, 1997. The increase is primarily due to an increase in property
net operating income (before depreciation) and an increase in other
revenues.
Cash flows used in investing activities for the six months ended June 30,
1998 increased to $55,868 from $42,813 for the six months ended June 30,
1997. The increase consisted primarily of expenditures for acquisition and
development costs, contributions to co-investment partnerships and working
capital advances to the Service Companies.
Net cash flows provided by financing activities for the six months ended
June 30, 1998 were $35,059, which reflect net proceeds from the preferred
shares issued and net proceeds of additional borrowings. In 1997, cash
flows include net proceeds of borrowings and dividend payments.
Funds from operations is defined as income (loss) before minority interest
of the holders of OP Units and extraordinary items (computed in accordance
with generally accepted accounting principles), excluding gains (losses)
from debt restructuring and sales of property, plus certain non-cash items,
primarily depreciation. Adjustments for unconsolidated partnerships and
joint ventures are calculated to reflect funds from operations on the same
basis. Funds from operations is widely accepted in measuring the
performance of equity REITs. An understanding of the Company's funds from
operations will enhance the reader's comprehension of the Company's results
of operations and cash flows as presented in the financial statements and
data included elsewhere herein. Funds from operations should not be
considered an alternative to net income or any other GAAP measurement as a
measure of the results of the Company's operations, the Company's cash
flows or liquidity.
Funds from operations for the six months ended June 30, 1998 and 1997 are
summarized as follows:
JUNE 30,
------------------------
1998 1997
------- -------
Income before minority
interest $13,949 12,114
Depreciation 8,779 6,253
Other, net (1) 1,866 1,154
------- ------
Funds from operations $24,594 19,521
======= ======
Weighted average shares
and units (including
dilutive shares and units) 21,730 19,017
======= ======
(1) Share of co-investment partnerships' depreciation and, in 1998,
share of Service Company amortization of goodwill (net of related income
taxes).
<PAGE>
In the typical situation, start-up losses will be recorded between the time
the first apartment homes are delivered from construction until occupancy
levels are adequate to recover all costs and expenses (including interest
but excluding depreciation). The amounts shown above for the six months
ended June 30, 1998 and 1997 are shown net of $782 and $568, respectively,
of start-up losses which, for the six months ended June 30, 1998 are
attributable to the initial lease-up of Phase III of AMLI at Autumn Chase,
AMLI at Wells Branch, AMLI at Park Creek, AMLI at Fox Valley, AMLI at
Fossil Creek, AMLI at Peachtree City and AMLI at Northwinds. Additional
amounts will be recorded in future quarters of 1998 as initial lease-up is
completed or continued at these and other communities currently under
development.
The Company expects to pay quarterly dividends from cash available for
distribution. Until distributed, funds available for distribution will be
invested in short-term investment-grade securities or used to temporarily
reduce outstanding balances on the Company's revolving lines of credit.
The Company expects to meet its short-term liquidity requirements by using
its working capital and any portion of net cash flow from operations not
distributed currently. The Company is of the opinion that its future net
cash flows will be adequate to meet operating requirements in both the
short and the long term and provide for payment of dividends by the Company
in accordance with REIT requirements. In order to qualify as a REIT, the
Company is required to make distributions to its shareholders equal to 95%
of its REIT taxable income. The Company's 1998 estimated dividend payment
level equals an annual rate of $1.76 per share. The Company estimates that
approximately 18% of the total dividends to be paid in 1998 will be treated
as a return of capital.
The Company expects to meet certain long-term liquidity requirements such
as scheduled debt maturities, repayment of loans for construction,
development, and acquisition activities through the issuance of long-term
secured and unsecured debt and additional equity securities of the Company
(or OP Units). On July 20, 1995, the Company's shelf registration became
effective. The registration statement provided for up to an aggregate of
$200,000 of preferred shares, common shares and security warrants which the
Company may issue from time to time. Through June 30, 1998, the Company
has issued preferred and common shares for an aggregate issuance price of
$128,467, leaving a balance of $71,533 in shares that the Company may issue
in the future under the shelf registration statement.
COMPANY INDEBTEDNESS
The Company's debt as of June 30, 1998 includes $195,858 (58% of the
total) which is secured by first mortgages on 14 of the Wholly-Owned
Communities and is summarized as follows:
SUMMARY DEBT TABLE
------------------
Type of Weighted Average Outstanding Percent
Indebtedness Interest Rate Balance of Total
- ------------ ---------------- ----------- --------
Fixed Rate
Mortgages 7.61% $190,108 56%
Tax-Exempt Tax-Exempt Rate + 1.48% 50,250 15%
Bonds (1) Tax-Exempt Rate + 1.15%
Lines of
Credit (2) LIBOR + 0.90% 91,000 27%
Notes payable
to Service
Companies Various 5,750 2%
-------- ----
Total $337,108 100%
======== ====
<PAGE>
- --------------------
(1) The tax-exempt bonds bear interest at a variable tax-exempt rate that
is adjusted weekly based on the re-marketing of these bonds (3.55% for AMLI
at Spring Creek and AMLI at Poplar Creek at July 29, 1998). The Spring
Creek bonds mature on October 1, 2024 and the related credit enhancement
expires on October 15, 2002. The Poplar Creek bonds mature on February 1,
2024 and the related credit enhancement expires on December 18, 2002.
(2) "Weighted average interest rate" reflects July 1998 change from LIBOR
plus 1.30%. The July amendment to the Company's principal credit agreement
also provides for an annual facility fee of 0.20% of the total commitment.
The terms of the lines of credit extend to June 2001.
DEVELOPMENT ACTIVITIES
At June 30, 1998, there are thirteen communities or additional phases to
existing communities (including co-investment properties) that are under
development. When completed, a total of 4,324 apartment homes will be
added to the Company's portfolio of rental apartments. The estimated
development costs of the nine wholly-owned communities under development
total approximately $153,110 of which $55,628 has been incurred at June 30,
1998. The Company's share of the development costs for the four co-
investment partnerships is approximately $44,480 of which, at June 30,
1998, $8,694 remains to be funded.
In addition, the Company owns land for the development of an additional
2,188 apartment homes in Ft. Worth, Dallas and Houston Texas, Alpharetta,
Georgia and Indianapolis, Indiana. The total costs incurred to date of
$18,966 are primarily land acquisition costs and professional fees.
CAPITAL EXPENDITURES
Capital expenditures are those made for assets having a useful life in
excess of one year and include replacements (including carpeting and
appliances) and betterments, such as unit upgrades, enclosed parking
facilities and similar items.
In conjunction with acquisitions of existing properties, it is the
Company's policy to provide in its acquisition budgets adequate funds to
complete any deferred maintenance items and to otherwise make the
properties acquired competitive with comparable newly-constructed
properties. In some cases, the Company will provide in its acquisition
budget additional funds to upgrade or otherwise improve new acquisitions.
INFLATION
Virtually all apartment leases at the communities and co-investment
communities are for six or twelve months' duration. This enables the
Company to pass along inflationary increases in its operating expenses on a
timely basis. Because the Company's property operating expenses (exclusive
of depreciation and amortization) are approximately 40% of rental and other
revenue, increased inflation typically results in comparable increases in
income before interest and general and administrative expenses, so long as
rental market conditions allow increases in rental rates while maintaining
stable occupancy.
<PAGE>
An increase in general price levels may immediately precede, or accompany,
an increase in interest rates. The Company's exposure (including the
Company's proportionate share of its co-investment partnerships' exposure)
to rising interest rates is mitigated by the existing debt level of
approximately 45% of the Company's total market capitalization at June 30,
1998, the high percentage (63%) of intermediate term fixed rate debt, and
the use of interest rate swaps to effectively fix the interest rate on $20
million of floating rate debt through November 2002 and $30 million through
February 2003. As a result, for the foreseeable future, increases in
interest expense resulting from increasing inflation are anticipated to be
less than future increases in income before interest and general and
administrative expenses.
YEAR 2000 READINESS
The Chairman of the Securities and Exchange Commission has asked all public
companies to provide thorough, meaningful disclosure regarding their Year
2000 readiness. This topic is getting increasing attention as January 1,
2000 gets closer. As is now widely understood, there is real potential for
malfunction by computers and other equipment whose performance is dependent
in part on microprocessors.
The Company and the Service Companies have replaced all primary data
processing systems within the last thirty months and believe the new
systems are Year 2000 compliant. The Company is commencing testing of its
data processing systems in October 1998 and anticipates that this testing
will be complete by March 31, 1999. Little remedial action is anticipated.
Some external consultants are being engaged by the Service Companies to
assist to these testing efforts and remedial action, if any is required.
Total costs for using outside consultants in this effort is estimated at
less than $100,000, none of which has yet been incurred.
The Company has undertaken a review of other aspects of its operations that
may be affected by the Year 2000 problem. For instance, three of its
communities have elevators whose performance could be affected. The
Company has contacted all its significant vendors, including banks and
companies providing outsourcing services for payroll and benefits
administration, to ensure that these vendors are satisfactorily addressing
the problem. The Company continues to be of the opinion that there will be
no direct material effect on its operating performance or results of
operations from the Year 2000 problem. Although the Company intends to
diligently continue preparations for Year 2000, it is not possible to
quantify potential indirect effects resulting from the lack of readiness on
the part of others with whom the Company conducts its business.
OTHER MATTERS
Statement of Financial Accounting Standards No. 131 "Disclosures about
Segments of an Enterprise and Related Information" becomes effective for
fiscal years beginning after December 15, 1997 and will not have a material
impact on the Company's financial statements.
Statement of Financial Accounting Standards No. 133 "Accounting for
Derivative Instruments and Hedging Activities" becomes effective for all
fiscal quarters for fiscal years beginning after June 15, 1999 and is not
expected to have a material impact on the Company's financial statements.
<PAGE>
SAFE HARBOR STATEMENT UNDER THE PRIVATE SECURITIES
LITIGATION REFORM ACT OF 1995
Certain statements set forth herein or incorporated by reference herein
from the Company's filings under the Securities Exchange Act of 1934, as
amended, contain forward-looking statements, including, without limitation,
statements relating to the timing and anticipated capital expenditures of
the Company's development programs. Although the Company believes that the
expectations reflected in such forward-looking statements are based on
reasonable assumptions, the actual results may differ materially from that
set forth in the forward-looking statements. Certain factors that might
cause such differences include general economic conditions, local real
estate conditions, construction delays due to the unavailability of
construction materials, weather conditions or other delays beyond the
control of the Company. Consequently, such forward-looking statements
should be regarded solely as reflections of the Company's current operating
and development plans and estimates. These plans and estimates are subject
to revision from time to time as additional information becomes available,
and actual results may differ from those indicated in the referenced
statements.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Not applicable.
<PAGE>
<TABLE>
OCCUPANCY
The following is a listing of approximate physical occupancy levels by quarter for the Company's Wholly-Owned
Communities and Co-Investment Communities:
<CAPTION>
1998 1997
LOCATION/COMMUNITY COMPANY'S NUMBER -------------------------- --------------------------
- ------------------ PERCENTAGE OF AT AT AT AT AT AT AT AT
WHOLLY-OWNED COMMUNITIES OWNERSHIP UNITS 12/31 9/30 6/30 3/31 12/31 9/30 6/30 3/31
- ------------------------ ---------- ------- ----- ----- ----- ------ ----- ----- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DALLAS/FT. WORTH, TEXAS
AMLI at AutumnChase . . . . 450 90% 97% 96% 97% 95% 97%
AMLI at Bent Tree . . . . . 300 93% 93% 93% N/A N/A N/A
AMLI at Bishop's Gate . . . 266 97% 100% 90% N/A N/A N/A
AMLI at Chase Oaks. . . . . 250 93% 98% 94% 96% 97% 96%
AMLI at Gleneagles. . . . . 590 98% 97% 97% 99% 98% 96%
AMLI on the Green . . . . . 424 92% 96% 93% 95% 93% 91%
AMLI at Nantucket . . . . . 312 97% 98% 98% 98% 98% 99%
AMLI of North Dallas. . . . 1,032 93% 96% 95% 96% 97% 94%
AMLI at Reflections . . . . 212 96% 98% 98% 98% 98% 96%
AMLI on Rosemeade . . . . . 236 95% 96% 92% 95% 97% 97%
AMLI on Timberglen. . . . . 260 94% 95% 98% 95% 97% 97%
AMLI at Valley Ranch. . . . 460 97% 98% 99% 97% 97% 95%
------ ----- ----- ----- ----- ----- ----- ----- -----
4,792 94% 97% 96% 97% 96% 95%
------ ----- ----- ----- ----- ----- ----- ----- -----
AUSTIN, TEXAS
AMLI at the Arboretum . . . 231 96% 97% 96% 100% 97% 97%
AMLI in Great Hills . . . . 344 97% 98% 97% 98% 97% 95%
AMLI at Lantana Ridge . . . 354 92% 94% 81% 83% N/A N/A
AMLI at Martha's Vineyard . 360 97% 96% 97% 98% 99% 97%
------ ----- ----- ----- ----- ----- ----- ----- -----
1,289 96% 96% 92% 94% 98% 96%
------ ----- ----- ----- ----- ----- ----- ----- -----
ATLANTA, GEORGIA
AMLI at Sope Creek. . . . . 695 95% 94% 93% 94% 93% 96%
AMLI at Spring Creek. . . . 1,180 93% 94% 94% 95% 95% 97%
AMLI at Vinings . . . . . . 360 96% 95% 96% 96% 95% 93%
AMLI at West Paces. . . . . 337 99% 98% 94% 92% 93% 98%
AMLI at Clairmont . . . . . 288 96% 96% N/A N/A N/A N/A
AMLI at Peachtree City. . . 312 99% N/A N/A N/A N/A N/A
------ ----- ----- ----- ----- ----- ----- ----- -----
3,172 95% 95% 94% 94% 94% 96%
------ ----- ----- ----- ----- ----- ----- ----- -----
<PAGE>
1998 1997
COMPANY'S NUMBER -------------------------- --------------------------
PERCENTAGE OF AT AT AT AT AT AT AT AT
LOCATION/COMMUNITY OWNERSHIP UNITS 12/31 9/30 6/30 3/31 12/31 9/30 6/30 3/31
- ------------------ ---------- ------- ----- ----- ----- ------ ----- ----- ------ ------
EASTERN KANSAS
AMLI at Alvamar . . . . . . 152 94% 95% 93% 90% 93% 98%
AMLI at Crown Colony. . . . 220 89% 96% 95% 98% 93% 97%
AMLI at Regents Center. . . 424 95% 90% 87% 93% 99% 91%
AMLI at Town Center . . . . 156 94% 93% 92% N/A N/A N/A
AMLI at Sherwood. . . . . . 300 93% 92% 97% 98% 95% 98%
------ ----- ----- ----- ----- ----- ----- ----- -----
1,252 93% 93% 92% 95% 96% 96%
------ ----- ----- ----- ----- ----- ----- ----- -----
INDIANAPOLIS, INDIANA
AMLI at Conner Farms. . . . 300 86% 90% 93% N/A N/A N/A
AMLI at Riverbend . . . . . 996 93% 96% 88% 89% 94% 92%
------ ----- ----- ----- ----- ----- ----- ----- -----
1,296 92% 95% 89% 89% 94% 92%
------ ----- ----- ----- ----- ----- ----- ----- -----
CHICAGO, ILLINOIS
AMLI at Park Sheridan . . . 253 97% 100% 98% 99% 92% 93%
AMLI at Poplar Creek. . . . 196 95% 98% 91% N/A N/A N/A
------ ----- ----- ----- ----- ----- ----- ----- -----
449 96% 99% 95% 99% 92% 93%
------ ----- ----- ----- ----- ----- ----- ----- -----
12,250 94.3% 95.6% 93.6% 95.0% 95.4% 95.1%
====== ===== ===== ===== ===== ===== ===== ===== =====
CO-INVESTMENT COMMUNITIES:
- --------------------------
ATLANTA, GA
AMLI at: lease lease lease
Barrett Lakes. . . . . . . 35% 446 93% 96% 95% up up up
Pleasant Hill. . . . . . . 40% 502 95% 93% 89% 91% 96% 97%
lease lease
River Park . . . . . . . . 40% 222 95% 98% 95% 97% up up
Towne Creek. . . . . . . . 1% 150 92% 95% 88% 97% 90% 93%
Willeo Creek . . . . . . . 30% 242 94% 98% 91% 91% 95% 98%
------ ----- ----- ----- ----- ----- ----- ----- -----
1,562 94% 96% 92% 93% 95% 96%
------ ----- ----- ----- ----- ----- ----- ----- -----
<PAGE>
1998 1997
COMPANY'S NUMBER -------------------------- --------------------------
PERCENTAGE OF AT AT AT AT AT AT AT AT
LOCATION/COMMUNITY OWNERSHIP UNITS 12/31 9/30 6/30 3/31 12/31 9/30 6/30 3/31
- ------------------ ---------- ------- ----- ----- ----- ------ ----- ----- ------ ------
CHICAGO, IL
AMLI at:
Chevy Chase. . . . . . . . 33% 592 98% 97% 94% 96% 99% 97%
Prairie Court. . . . . . . 1% 125 93% 96% 98% 98% 100% 97%
Willowbrook. . . . . . . . 40% 488 98% 98% 94% 98% 94% 96%
Windbrooke . . . . . . . . 15% 236 95% 100% 98% 99% 100% 96%
Danada Farms . . . . . . . 10% 600 96% 98% 93% 94% 93% 92%
Fox Valley . . . . . . . . 25% 272 87% N/A N/A N/A N/A N/A
------- ----- ----- ----- ----- ----- ----- ----- -----
2,313 95% 98% 94% 96% 96% 95%
------- ----- ----- ----- ----- ----- ----- ----- -----
EASTERN KANSAS
AMLI at Regents Crest . . . 25% 368 94% 92% 93% N/A N/A N/A
------- ----- ----- ----- ----- ----- ----- ----- -----
DALLAS, TX
AMLI at Verandah. . . . . . 35% 538 96% 97% 94% 95% 96% 94%
------- ----- ----- ----- ----- ----- ----- ----- -----
AUSTIN, TX
AMLI at Park Place. . . . . 25% 588 95% 95% 98% 97% 94% 96%
------- ----- ----- ----- ----- ----- ----- ----- -----
HOUSTON, TX
AMLI at:
Champions Centre . . . . . 15% 192 97% 98% 97% 94% 98% 95%
Champions Park . . . . . . 15% 246 95% 95% 98% 99% 99% 97%
Greenwood Forest . . . . . 15% 316 96% 97% 95% 96% 96% 96%
------- ----- ----- ----- ----- ----- ----- ----- -----
754 96% 97% 96% 96% 98% 96%
------- ----- ----- ----- ----- ----- ----- ----- -----
Total Co-Investment
Communities. . . . . . . . . 6,123 94.8% 96.4% 94.2% 95.5% 95.8% 95.5%
------- ----- ----- ----- ----- ----- ----- ----- -----
TOTAL. . . . . . . . . . . . . 18,373 94.4% 95.9% 93.8% 95.2% 95.7% 95.3%
======= ===== ===== ===== ===== ===== ===== ===== =====
</TABLE>
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
No reports on Form 8-K have been filed during the quarter ended June 30,
1998. The Exhibits filed as part of this report are listed below.
EXHIBIT NO. DOCUMENT DESCRIPTION
10.1 Employment Agreement between the Registrant and
Gregory T. Mutz
10.2 Employment Agreement between the Registrant and
John E. Allen
10.3 Employment Agreement between the Registrant and Allan J.
Sweet
10.4 Employment Agreement between the Registrant and
Philip N. Tague
10.5 Employment Agreement between the Registrant and
Robert S. Aisner
10.6 Employment Agreement between the Registrant and
Robert J. Chapman
10.7 $200,000 Amended and Restated Credit Agreement dated as
of July 27, 1998 among AMLI Residential Properties, L.P., the banks listed
herein, Wachovia Bank, N.A., as Agent and The First National Bank of
Chicago, as Documentation Agent and Dresdner Bank, A.G., New York and Grand
Cayman Branches, as Co-Agent.
21.1 Subsidiaries of the Registrant.
27. Financial Data Schedule
99. Financial and Operating Data furnished to Shareholders
and Analysts
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
AMLI RESIDENTIAL PROPERTIES TRUST
Date: August 7, 1998 By: /s/ CHARLES C. KRAFT
-----------------------------------
Charles C. Kraft
Principal Accounting Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
Date: August 7, 1998 By: /s/ GREGORY T. MUTZ
-----------------------------------
Gregory T. Mutz
Chairman of the Board of Trustees
Date: August 7, 1998 By: /s/ ALLAN J. SWEET
-----------------------------------
Allan J. Sweet
President and Trustee
Date: August 7, 1998 By: /s/ ROBERT J. CHAPMAN
-----------------------------------
Robert J. Chapman
Principal Financial Officer
Date: August 7, 1998 By: /s/ CHARLES C. KRAFT
-----------------------------------
Charles C. Kraft
Principal Accounting Officer
EXHIBIT 10.1
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between Greg Mutz (the "Employee") and AMLI
RESIDENTIAL PROPERTIES TRUST (the "Company"). The Company, collectively
with AMLI Residential Properties Trust, a Maryland real estate investment
trust (the "REIT"), AMLI Residential Properties, L.P. (the "Operating
Partnership"), any entity in which the REIT or the Operating Partnership
own no less than 90% of the economic interests therein, and any successors
thereto, are referred to herein collectively as "AMLI" and individually as
an "AMLI entity";
WITNESSETH THAT:
---------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to be
subject to the terms and conditions of this Agreement, which Agreement sets
forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote such
portion of his business time, energy and talents as is agreed to from time
to time between Employee and Company to providing services for the Company
in the position specified in Appendix A, which Appendix A is made part of
this Agreement, and that he may be required to perform his duties under
this Agreement at such locations within or outside the United States as may
be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective Date
the annual base salary specified in Appendix A hereto (the "Salary"), which
Salary shall be payable in accordance with the Company's customary payroll
practices as in effect from time to time during the term of his employment.
The Employee's Salary rate shall be reviewed at least annually by the
Company in accordance with the Company's customary salary review procedures
as in effect from time to time during the term of his employment.
(b) BONUS. The Employee may become entitled to receive bonuses as
determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as specifically
provided to the contrary in this Agreement, the Employee shall be provided
with the welfare benefits and other fringe benefits to the same extent and
on the same terms as those benefits are provided by the Company from time
to time to the Company's other senior management employees, plus any
additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the Company, on
terms and conditions that are substantially similar to those that apply to
other similarly situated senior management employees of the Company, for
reasonable expenses for entertainment, travel, meals, lodging and similar
items in accordance with and subject to the Company's expense reimbursement
policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date occurs
during the Agreement Period for any reason, then the Employee shall be
entitled to the following payments, in addition to any payments or benefits
to which the Employee may be entitled under the following provisions of
this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period ending on
his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the period
ending with his Termination Date, as determined in accordance with the
Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE. If
the Employee's Termination Date occurs during the Agreement Period and is a
result of the Employee's termination of employment by the Company for any
reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT OR
OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change in
Circumstance, as such terms are defined below, the Company will pay to the
Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated from
employment for any reason (other than Cause) following or in connection
with both a Change of Control and a Change in Circumstance, the Employee
and his eligible dependents will be entitled to continue to be covered at
the Company's expense under the Company's health, dental, life insurance,
and disability welfare plans as in effect at the Employee's termination of
Employment, or comparable plans, for a period of two years following the
date of the such termination of employment; provided however, that such
benefits shall cease upon the Employee's employment by a new entity under
which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his rights under
this Agreement following a Change in Control, regardless of whether a
Change in Circumstances also occurs, all reasonable costs and expenses
(including fees and disbursements of counsel) incurred by the Employee in
seeking to interpret or enforce rights pursuant to this Agreement shall be
paid on behalf of or reimbursed to the Employee promptly by the Company,
whether or not the Employee is successful in asserting such rights;
provided, however, that no reimbursement shall be made of such expenses
relating to any unsuccessful assertion of rights if and to the extent that
Employee's assertion of such rights was in bad faith or frivolous, as
determined by independent counsel mutually acceptable to the Employee and
the Company.
(d) "Change in Control" shall mean the occurrence of any of the
following:
(i) any Person other than:
a trustee or other fiduciary of securities held under
an employee benefit plan of the REIT or an employee benefit plan of an
Affiliate of the REIT;
a corporation or trust owned, directly or indirectly,
by the present shareholders on the Effective Date of the REIT in
substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a substantial
(10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI, or their
respective Affiliates and families; or
a Person that acquires Shares pursuant to a Business
Combination (as defined below) which is approved by the shareholders of the
REIT and which complies with subparagraph (iv) of this definition;
<PAGE>
is or becomes a beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(ii) a tender offer is made for the shares of beneficial
interest of the REIT and the Person making the offer owns or has accepted
for payment Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees consists
of individuals other than Incumbent Trustees, which term means the members
of the REIT's Board of Trustees on the date of this Agreement; provided
that any individual becoming a Trustee subsequent to such date whose
election or nomination for election was supported by 2/3 of the Trustees
who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a reorganization,
merger, consolidation or sale of all or substantially all of the assets of
the Company, the REIT, or the Operating Partnership (a "Business
Combination") with or to any other Person (other than, the Employee, UICI,
or their respective Affiliates) other than a Business Combination which (a)
would not result in any Person (other than Employee, or UICI or their
respective Affiliates) owning, directly or indirectly, 50% or more of the
combined voting power of the REIT's or such surviving entity's outstanding
voting securities, or of the Operating Partnership's Units, immediately
after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any of the
following within eighteen months of a Change in Control while the Employee
is employed by the Company:
(i) a reduction in the Employee's job title or job
responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation, as
described in Paragraph 3, as in effect immediately prior to the Change in
Control;
(iii) the Employee's relocation to a location not within
fifty miles of his office or job location on the date of the Change in
Control, except for required travel on the Company's business to an extent
substantially consistent with his business travel obligations as in effect
immediately prior to the Change in Control; or
(iv) the Employee's involuntary termination of employment
by the Company without Cause.
<PAGE>
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
<PAGE>
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ GREGORY T. MUTZ
------------------------------
Employee
AMLI RESIDENTIAL PROPERTIES TRUST
By /S/ ROBERT J. CHAPMAN
-----------------------
Its Chief Financial Officer
-----------------------
<PAGE>
Exhibit A to Employment Agreement for
-------------------------------------
GREG MUTZ
---------
TITLE:
(ref. Paragraph 1) Chairman & Chief Executive Officer of AMLI
Residential Properties Trust.
RESPONSIBILITIES:
(ref. Paragraph 2) General corporate responsibilities consistent
with the titles of Chairman of the Board and Chief Executive Officer.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $125,000
FRINGE BENEFITS:
(ref. Paragraph 3.c) Cost of income tax preparation.
Reimbursement for club dues.
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) --
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.2
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between John Allen (the "Employee") and AMLI
RESIDENTIAL PROPERTIES TRUST (the "Company"). The Company, collectively
with AMLI Residential Properties Trust, a Maryland real estate investment
trust (the "REIT"), AMLI Residential Properties, L.P. (the "Operating
Partnership"), any entity in which the REIT or the Operating Partnership
own no less than 90% of the economic interests therein, and any successors
thereto, are referred to herein collectively as "AMLI" and individually as
an "AMLI entity";
WITNESSETH THAT:
---------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to be
subject to the terms and conditions of this Agreement, which Agreement sets
forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote such
portion of his business time, energy and talents as is agreed to from time
to time between Employee and Company to providing services for the Company
in the position specified in Appendix A, which Appendix A is made part of
this Agreement, and that he may be required to perform his duties under
this Agreement at such locations within or outside the United States as may
be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective
Date the annual base salary specified in Appendix A hereto (the "Salary"),
which Salary shall be payable in accordance with the Company's customary
payroll practices as in effect from time to time during the term of his
employment. The Employee's Salary rate shall be reviewed at least annually
by the Company in accordance with the Company's customary salary review
procedures as in effect from time to time during the term of his
employment.
(b) BONUS. The Employee may become entitled to receive
bonuses as determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as specifically
provided to the contrary in this Agreement, the Employee shall be provided
with the welfare benefits and other fringe benefits to the same extent and
on the same terms as those benefits are provided by the Company from time
to time to the Company's other senior management employees, plus any
additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the
Company, on terms and conditions that are substantially similar to those
that apply to other similarly situated senior management employees of the
Company, for reasonable expenses for entertainment, travel, meals, lodging
and similar items in accordance with and subject to the Company's expense
reimbursement policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date
occurs during the Agreement Period for any reason, then the Employee shall
be entitled to the following payments, in addition to any payments or
benefits to which the Employee may be entitled under the following
provisions of this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period
ending on his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the
period ending with his Termination Date, as determined in accordance with
the Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE.
If the Employee's Termination Date occurs during the Agreement Period and
is a result of the Employee's termination of employment by the Company for
any reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT
OR OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change
in Circumstance, as such terms are defined below, the Company will pay to
the Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated
from employment for any reason (other than Cause) following or in
connection with both a Change of Control and a Change in Circumstance, the
Employee and his eligible dependents will be entitled to continue to be
covered at the Company's expense under the Company's health, dental, life
insurance, and disability welfare plans as in effect at the Employee's
termination of Employment, or comparable plans, for a period of two years
following the date of the such termination of employment; provided however,
that such benefits shall cease upon the Employee's employment by a new
entity under which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his
rights under this Agreement following a Change in Control, regardless of
whether a Change in Circumstances also occurs, all reasonable costs and
expenses (including fees and disbursements of counsel) incurred by the
Employee in seeking to interpret or enforce rights pursuant to this
Agreement shall be paid on behalf of or reimbursed to the Employee promptly
by the Company, whether or not the Employee is successful in asserting such
rights; provided, however, that no reimbursement shall be made of such
expenses relating to any unsuccessful assertion of rights if and to the
extent that Employee's assertion of such rights was in bad faith or
frivolous, as determined by independent counsel mutually acceptable to the
Employee and the Company.
(d) "Change in Control" shall mean the occurrence of any
of the following:
(i) any Person other than:
a trustee or other fiduciary of securities
held under an employee benefit plan of the REIT or an employee benefit plan
of an Affiliate of the REIT;
a corporation or trust owned, directly or
indirectly, by the present shareholders on the Effective Date of the REIT
in substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a
substantial (10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI,
or their respective Affiliates and families; or
a Person that acquires Shares pursuant to a
Business Combination (as defined below) which is approved by the
shareholders of the REIT and which complies with subparagraph (iv) of this
definition;
<PAGE>
is or becomes a beneficial owner (as defined
in Rule 13d-3 under the Securities Exchange Act of 1934, as amended),
directly or indirectly, of Shares representing 25% or more of the total
voting power of the REIT's then outstanding shares of beneficial interest,
or of 25% or more of the then outstanding Units of the Operating
Partnership;
(ii) a tender offer is made for the shares of
beneficial interest of the REIT and the Person making the offer owns or has
accepted for payment Shares representing 25% or more of the total voting
power of the REIT's then outstanding shares of beneficial interest, or of
25% or more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees
consists of individuals other than Incumbent Trustees, which term means the
members of the REIT's Board of Trustees on the date of this Agreement;
provided that any individual becoming a Trustee subsequent to such date
whose election or nomination for election was supported by 2/3 of the
Trustees who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, the REIT, or the Operating Partnership (a
"Business Combination") with or to any other Person (other than, the
Employee, UICI, or their respective Affiliates) other than a Business
Combination which (a) would not result in any Person (other than Employee,
or UICI or their respective Affiliates) owning, directly or indirectly, 50%
or more of the combined voting power of the REIT's or such surviving
entity's outstanding voting securities, or of the Operating Partnership's
Units, immediately after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any
of the following within eighteen months of a Change in Control while the
Employee is employed by the Company:
(i) a reduction in the Employee's job title or
job responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation,
as described in Paragraph 3, as in effect immediately prior to the Change
in Control;
(iii) the Employee's relocation to a location not
within fifty miles of his office or job location on the date of the Change
in Control, except for required travel on the Company's business to an
extent substantially consistent with his business travel obligations as in
effect immediately prior to the Change in Control; or
<PAGE>
(iv) the Employee's involuntary termination of
employment by the Company without Cause.
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
<PAGE>
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ JOHN E. ALLEN
------------------------------
Employee
AMLI RESIDENTIAL PROPERTIES TRUST
By /S/ ROBERT J. CHAPMAN
-----------------------
Its Chief Financial Officer
-----------------------
<PAGE>
Exhibit A to Employment Agreement for
-------------------------------------
JOHN ALLEN
----------
TITLE:
(ref. Paragraph 1) Vice Chairman of AMLI Residential Properties
Trust.
RESPONSIBILITIES:
(ref. Paragraph 2) General corporate responsibilities consistent
with the title of Vice Chairman, as well as management responsibility for
AMLI's Legal and Risk Management groups.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $125,000
FRINGE BENEFITS:
(ref. Paragraph 3.c) Cost of income tax preparation.
Reimbursement for club dues.
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) 3x
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.3
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between Allan Sweet (the "Employee") and AMLI
RESIDENTIAL PROPERTIES TRUST (the "Company"). The Company, collectively
with AMLI Residential Properties Trust, a Maryland real estate investment
trust (the "REIT"), AMLI Residential Properties, L.P. (the "Operating
Partnership"), any entity in which the REIT or the Operating Partnership
own no less than 90% of the economic interests therein, and any successors
thereto, are referred to herein collectively as "AMLI" and individually as
an "AMLI entity";
WITNESSETH THAT:
---------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to
be subject to the terms and conditions of this Agreement, which Agreement
sets forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote his
full business time, energy and talents to providing services for the
Company in the position specified in Appendix A, which Appendix A is made
part of this Agreement, and that he may be required to perform his duties
under this Agreement at such locations within or outside the United States
as may be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective Date
the annual base salary specified in Appendix A hereto (the "Salary"), which
Salary shall be payable in accordance with the Company's customary payroll
practices as in effect from time to time during the term of his employment.
The Employee's Salary rate shall be reviewed at least annually by the
Company in accordance with the Company's customary salary review procedures
as in effect from time to time during the term of his employment.
(b) BONUS. The Employee may become entitled to receive bonuses as
determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as specifically
provided to the contrary in this Agreement, the Employee shall be provided
with the welfare benefits and other fringe benefits to the same extent and
on the same terms as those benefits are provided by the Company from time
to time to the Company's other senior management employees, plus any
additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the Company, on
terms and conditions that are substantially similar to those that apply to
other similarly situated senior management employees of the Company, for
reasonable expenses for entertainment, travel, meals, lodging and similar
items in accordance with and subject to the Company's expense reimbursement
policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date occurs
during the Agreement Period for any reason, then the Employee shall be
entitled to the following payments, in addition to any payments or benefits
to which the Employee may be entitled under the following provisions of
this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period ending on
his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the period
ending with his Termination Date, as determined in accordance with the
Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE. If
the Employee's Termination Date occurs during the Agreement Period and is a
result of the Employee's termination of employment by the Company for any
reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT OR
OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change in
Circumstance, as such terms are defined below, the Company will pay to the
Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated from
employment for any reason (other than Cause) following or in connection
with both a Change of Control and a Change in Circumstance, the Employee
and his eligible dependents will be entitled to continue to be covered at
the Company's expense under the Company's health, dental, life insurance,
and disability welfare plans as in effect at the Employee's termination of
Employment, or comparable plans, for a period of two years following the
date of the such termination of employment; provided however, that such
benefits shall cease upon the Employee's employment by a new entity under
which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his rights under
this Agreement following a Change in Control, regardless of whether a
Change in Circumstances also occurs, all reasonable costs and expenses
(including fees and disbursements of counsel) incurred by the Employee in
seeking to interpret or enforce rights pursuant to this Agreement shall be
paid on behalf of or reimbursed to the Employee promptly by the Company,
whether or not the Employee is successful in asserting such rights;
provided, however, that no reimbursement shall be made of such expenses
relating to any unsuccessful assertion of rights if and to the extent that
Employee's assertion of such rights was in bad faith or frivolous, as
determined by independent counsel mutually acceptable to the Employee and
the Company.
(d) "Change in Control" shall mean the occurrence of any of the
following:
(i) any Person other than:
a trustee or other fiduciary of securities
held under an employee benefit plan of the REIT or an employee benefit plan
of an Affiliate of the REIT;
a corporation or trust owned, directly or
indirectly, by the present shareholders on the Effective Date of the REIT
in substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a
substantial (10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI,
or their respective Affiliates and families; or
a Person that acquires Shares pursuant to a
Business Combination (as defined below) which is approved by the
shareholders of the REIT and which complies with subparagraph (iv) of this
definition;
<PAGE>
is or becomes a beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(ii) a tender offer is made for the shares of
beneficial interest of the REIT and the Person making the offer owns or has
accepted for payment Shares representing 25% or more of the total voting
power of the REIT's then outstanding shares of beneficial interest, or of
25% or more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees
consists of individuals other than Incumbent Trustees, which term means the
members of the REIT's Board of Trustees on the date of this Agreement;
provided that any individual becoming a Trustee subsequent to such date
whose election or nomination for election was supported by 2/3 of the
Trustees who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, the REIT, or the Operating Partnership (a
"Business Combination") with or to any other Person (other than, the
Employee, UICI, or their respective Affiliates) other than a Business
Combination which (a) would not result in any Person (other than Employee,
or UICI or their respective Affiliates) owning, directly or indirectly, 50%
or more of the combined voting power of the REIT's or such surviving
entity's outstanding voting securities, or of the Operating Partnership's
Units, immediately after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any
of the following within eighteen months of a Change in Control while the
Employee is employed by the Company:
(i) a reduction in the Employee's job title or
job responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation,
as described in Paragraph 3, as in effect immediately prior to the Change
in Control;
(iii) the Employee's relocation to a location not
within fifty miles of his office or job location on the date of the Change
in Control, except for required travel on the Company's business to an
extent substantially consistent with his business travel obligations as in
effect immediately prior to the Change in Control; or
<PAGE>
(iv) the Employee's involuntary termination of
employment by the Company without Cause.
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
<PAGE>
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ ALLAN J. SWEET
-------------------------------
Employee
AMLI RESIDENTIAL PROPERTIES TRUST
By /S/ ROBERT J. CHAPMAN
-------------------------
Its Chief Financial Officer
-------------------------
<PAGE>
Exhibit A to Employment Agreement for
--------------------------------------
ALLAN SWEET
-----------
TITLE:
(ref. Paragraph 1) President of AMLI Residential Properties Trust.
RESPONSIBILITIES:
(ref. Paragraph 2) General corporate responsibilities consistent
with the title of President, as well as management responsibility for
AMLI's Acquisition and Co-investment, Investor Relations, and Corporate
Communications activities.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $220,000
FRINGE BENEFITS:
(ref. Paragraph 3.c) Cost of income tax preparation.
Reimbursement for club dues.
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) 3x
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.4
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between Phil Tague (the "Employee") and AMLI
RESIDENTIAL CONSTRUCTION, INC. (the "Company"). The Company, collectively
with AMLI Residential Properties Trust, a Maryland real estate investment
trust (the "REIT"), AMLI Residential Properties, L.P. (the "Operating
Partnership"), any entity in which the REIT or the Operating Partnership
own no less than 90% of the economic interests therein, and any successors
thereto, are referred to herein collectively as "AMLI" and individually as
an "AMLI entity";
WITNESSETH THAT:
----------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to
be subject to the terms and conditions of this Agreement, which Agreement
sets forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote his
full business time, energy and talents to providing services for the
Company in the position specified in Appendix A, which Appendix A is made
part of this Agreement, and that he may be required to perform his duties
under this Agreement at such locations within or outside the United States
as may be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective
Date the annual base salary specified in Appendix A hereto (the "Salary"),
which Salary shall be payable in accordance with the Company's customary
payroll practices as in effect from time to time during the term of his
employment. The Employee's Salary rate shall be reviewed at least annually
by the Company in accordance with the Company's customary salary review
procedures as in effect from time to time during the term of his
employment.
(b) BONUS. The Employee may become entitled to receive
bonuses as determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as
specifically provided to the contrary in this Agreement, the Employee shall
be provided with the welfare benefits and other fringe benefits to the same
extent and on the same terms as those benefits are provided by the Company
from time to time to the Company's other senior management employees, plus
any additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the
Company, on terms and conditions that are substantially similar to those
that apply to other similarly situated senior management employees of the
Company, for reasonable expenses for entertainment, travel, meals, lodging
and similar items in accordance with and subject to the Company's expense
reimbursement policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date
occurs during the Agreement Period for any reason, then the Employee shall
be entitled to the following payments, in addition to any payments or
benefits to which the Employee may be entitled under the following
provisions of this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period
ending on his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the
period ending with his Termination Date, as determined in accordance with
the Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE.
If the Employee's Termination Date occurs during the Agreement Period and
is a result of the Employee's termination of employment by the Company for
any reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT
OR OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change
in Circumstance, as such terms are defined below, the Company will pay to
the Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated
from employment for any reason (other than Cause) following or in
connection with both a Change of Control and a Change in Circumstance, the
Employee and his eligible dependents will be entitled to continue to be
covered at the Company's expense under the Company's health, dental, life
insurance, and disability welfare plans as in effect at the Employee's
termination of Employment, or comparable plans, for a period of two years
following the date of the such termination of employment; provided however,
that such benefits shall cease upon the Employee's employment by a new
entity under which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his
rights under this Agreement following a Change in Control, regardless of
whether a Change in Circumstances also occurs, all reasonable costs and
expenses (including fees and disbursements of counsel) incurred by the
Employee in seeking to interpret or enforce rights pursuant to this
Agreement shall be paid on behalf of or reimbursed to the Employee promptly
by the Company, whether or not the Employee is successful in asserting such
rights; provided, however, that no reimbursement shall be made of such
expenses relating to any unsuccessful assertion of rights if and to the
extent that Employee's assertion of such rights was in bad faith or
frivolous, as determined by independent counsel mutually acceptable to the
Employee and the Company.
(d) "Change in Control" shall mean the occurrence of any
of the following:
(i) any Person other than:
a trustee or other fiduciary of securities
held under an employee benefit plan of the REIT or an employee benefit plan
of an Affiliate of the REIT;
a corporation or trust owned, directly or
indirectly, by the present shareholders on the Effective Date of the REIT
in substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a
substantial (10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI,
or their respective Affiliates and families; or
a Person that acquires Shares pursuant to a
Business Combination (as defined below) which is approved by the
shareholders of the REIT and which complies with subparagraph (iv) of this
definition;
<PAGE>
is or becomes a beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(ii) a tender offer is made for the shares of
beneficial interest of the REIT and the Person making the offer owns or has
accepted for payment Shares representing 25% or more of the total voting
power of the REIT's then outstanding shares of beneficial interest, or of
25% or more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees
consists of individuals other than Incumbent Trustees, which term means the
members of the REIT's Board of Trustees on the date of this Agreement;
provided that any individual becoming a Trustee subsequent to such date
whose election or nomination for election was supported by 2/3 of the
Trustees who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, the REIT, or the Operating Partnership (a
"Business Combination") with or to any other Person (other than, the
Employee, UICI, or their respective Affiliates) other than a Business
Combination which (a) would not result in any Person (other than Employee,
or UICI or their respective Affiliates) owning, directly or indirectly, 50%
or more of the combined voting power of the REIT's or such surviving
entity's outstanding voting securities, or of the Operating Partnership's
Units, immediately after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any
of the following within eighteen months of a Change in Control while the
Employee is employed by the Company:
(i) a reduction in the Employee's job title or
job responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation,
as described in Paragraph 3, as in effect immediately prior to the Change
in Control;
(iii) the Employee's relocation to a location not
within fifty miles of his office or job location on the date of the Change
in Control, except for required travel on the Company's business to an
extent substantially consistent with his business travel obligations as in
effect immediately prior to the Change in Control; or
<PAGE>
(iv) the Employee's involuntary termination of
employment by the Company without Cause.
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
<PAGE>
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ PHILIP N. TAGUE
------------------------------
Employee
AMLI RESIDENTIAL CONSTRUCTION,
INC.
By /S/ ROBERT J. CHAPMAN
-----------------------
Its Chief Financial Officer
-----------------------
<PAGE>
Exhibit A to Employment Agreement for
-------------------------------------
PHIL TAGUE
----------
TITLE:
(ref. Paragraph 1) Chairman of AMLI Residential Construction, Inc.
RESPONSIBILITIES:
(ref. Paragraph 2) Management responsibility for all of AMLI's
Development activities.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $220,000
FRINGE BENEFITS:
(ref. Paragraph 3.c)
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) 3x
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.5
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between Bob Aisner (the "Employee") and AMLI
MANAGEMENT COMPANY (the "Company"). The Company, collectively with AMLI
Residential Properties Trust, a Maryland real estate investment trust (the
"REIT"), AMLI Residential Properties, L.P. (the "Operating Partnership"),
any entity in which the REIT or the Operating Partnership own no less than
90% of the economic interests therein, and any successors thereto, are
referred to herein collectively as "AMLI" and individually as an "AMLI
entity";
WITNESSETH THAT:
---------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to
be subject to the terms and conditions of this Agreement, which Agreement
sets forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote his
full business time, energy and talents to providing services for the
Company in the position specified in Appendix A, which Appendix A is made
part of this Agreement, and that he may be required to perform his duties
under this Agreement at such locations within or outside the United States
as may be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective
Date the annual base salary specified in Appendix A hereto (the "Salary"),
which Salary shall be payable in accordance with the Company's customary
payroll practices as in effect from time to time during the term of his
employment. The Employee's Salary rate shall be reviewed at least annually
by the Company in accordance with the Company's customary salary review
procedures as in effect from time to time during the term of his
employment.
(b) BONUS. The Employee may become entitled to receive
bonuses as determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as
specifically provided to the contrary in this Agreement, the Employee shall
be provided with the welfare benefits and other fringe benefits to the same
extent and on the same terms as those benefits are provided by the Company
from time to time to the Company's other senior management employees, plus
any additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the
Company, on terms and conditions that are substantially similar to those
that apply to other similarly situated senior management employees of the
Company, for reasonable expenses for entertainment, travel, meals, lodging
and similar items in accordance with and subject to the Company's expense
reimbursement policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date
occurs during the Agreement Period for any reason, then the Employee shall
be entitled to the following payments, in addition to any payments or
benefits to which the Employee may be entitled under the following
provisions of this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period
ending on his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the
period ending with his Termination Date, as determined in accordance with
the Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE.
If the Employee's Termination Date occurs during the Agreement Period and
is a result of the Employee's termination of employment by the Company for
any reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT
OR OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change
in Circumstance, as such terms are defined below, the Company will pay to
the Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated
from employment for any reason (other than Cause) following or in
connection with both a Change of Control and a Change in Circumstance, the
Employee and his eligible dependents will be entitled to continue to be
covered at the Company's expense under the Company's health, dental, life
insurance, and disability welfare plans as in effect at the Employee's
termination of Employment, or comparable plans, for a period of two years
following the date of the such termination of employment; provided however,
that such benefits shall cease upon the Employee's employment by a new
entity under which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his
rights under this Agreement following a Change in Control, regardless of
whether a Change in Circumstances also occurs, all reasonable costs and
expenses (including fees and disbursements of counsel) incurred by the
Employee in seeking to interpret or enforce rights pursuant to this
Agreement shall be paid on behalf of or reimbursed to the Employee promptly
by the Company, whether or not the Employee is successful in asserting such
rights; provided, however, that no reimbursement shall be made of such
expenses relating to any unsuccessful assertion of rights if and to the
extent that Employee's assertion of such rights was in bad faith or
frivolous, as determined by independent counsel mutually acceptable to the
Employee and the Company.
(d) "Change in Control" shall mean the occurrence of any
of the following:
(i) any Person other than:
a trustee or other fiduciary of securities
held under an employee benefit plan of the REIT or an employee benefit plan
of an Affiliate of the REIT;
a corporation or trust owned, directly or
indirectly, by the present shareholders on the Effective Date of the REIT
in substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a
substantial (10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI,
or their respective Affiliates and families; or
a Person that acquires Shares pursuant to a
Business Combination (as defined below) which is approved by the
shareholders of the REIT and which complies with subparagraph (iv) of this
definition;
<PAGE>
is or becomes a beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(ii) a tender offer is made for the shares of
beneficial interest of the REIT and the Person making the offer owns or has
accepted for payment Shares representing 25% or more of the total voting
power of the REIT's then outstanding shares of beneficial interest, or of
25% or more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees
consists of individuals other than Incumbent Trustees, which term means the
members of the REIT's Board of Trustees on the date of this Agreement;
provided that any individual becoming a Trustee subsequent to such date
whose election or nomination for election was supported by 2/3 of the
Trustees who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, the REIT, or the Operating Partnership (a
"Business Combination") with or to any other Person (other than, the
Employee, UICI, or their respective Affiliates) other than a Business
Combination which (a) would not result in any Person (other than Employee,
or UICI or their respective Affiliates) owning, directly or indirectly, 50%
or more of the combined voting power of the REIT's or such surviving
entity's outstanding voting securities, or of the Operating Partnership's
Units, immediately after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any of the
following within eighteen months of a Change in Control while the Employee
is employed by the Company:
(i) a reduction in the Employee's job title or
job responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation,
as described in Paragraph 3, as in effect immediately prior to the Change
in Control;
(iii) the Employee's relocation to a location not
within fifty miles of his office or job location on the date of the Change
in Control, except for required travel on the Company's business to an
extent substantially consistent with his business travel obligations as in
effect immediately prior to the Change in Control; or
<PAGE>
(iv) the Employee's involuntary termination of
employment by the Company without Cause.
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
<PAGE>
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ ROBERT S. AISNER
------------------------------
Employee
AMLI MANAGEMENT COMPANY
By /S/ ROBERT J. CHAPMAN
-----------------------
Its Chief Financial Officer
-----------------------
<PAGE>
Exhibit A to Employment Agreement for
-------------------------------------
BOB AISNER
----------
TITLE:
(ref. Paragraph 1) President of AMLI Management Company.
RESPONSIBILITIES:
(ref. Paragraph 2) Management responsibilities for AMLI's Property
Management operations, as well as responsibility for AMLI's development
activities in Dallas, Houston, and Austin.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $187,500
FRINGE BENEFITS:
(ref. Paragraph 3.c) Reimbursement for club dues.
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) 3x
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.6
- ------------
EMPLOYMENT AGREEMENT
--------------------
THIS AGREEMENT, made and entered into as of January 1, 1998 (the
"Effective Date") by and between Robert Chapman (the "Employee") and AMLI
RESIDENTIAL PROPERTIES TRUST (the "Company"). The Company, collectively
with AMLI Residential Properties Trust, a Maryland real estate investment
trust (the "REIT"), AMLI Residential Properties, L.P. (the "Operating
Partnership"), any entity in which the REIT or the Operating Partnership
own no less than 90% of the economic interests therein, and any successors
thereto, are referred to herein collectively as "AMLI" and individually as
an "AMLI entity";
WITNESSETH THAT:
---------------
WHEREAS, the parties desire to enter into this Agreement pertaining to
the continued employment of the Employee by the Company;
NOW THEREFORE, in consideration of the mutual covenants and agreements
set forth below, it is hereby covenanted and agreed by the Company and the
Employee as follows:
1. AGREEMENT PERIOD. The Company and the Employee hereby agree to
be subject to the terms and conditions of this Agreement, which Agreement
sets forth certain terms and conditions of the Employee's employment by the
Company during the Agreement Period (as defined below), including, but not
limited to, compensation payable to the Employee while he is employed by
the Company during the Agreement Period, the consequences of such
Employee's termination of employment during the Agreement Period, and the
consequences of a Change in Control and Change in Circumstance, both as
defined in Paragraph 9, during the Agreement Period. The "Agreement
Period" shall be the period beginning on the Effective Date and ending on
the first anniversary thereof. After the first anniversary of the
Effective Date, the Agreement Period shall be automatically extended for
12-month periods, and the last day of any such 12-month period shall be
referred to herein as an "Anniversary Date". Notwithstanding the
foregoing, an Employee who is continuing in employment with the Company may
elect to terminate the Agreement as of the next following Anniversary Date
by providing notice to the Company, in accordance with the requirements of
Paragraph 14, during the period beginning on November 1 and ending on
November 30 next preceding such Anniversary Date, and the Agreement Period
will end as of such Anniversary Date; provided, however, that once a Change
in Control has occurred, an Employee will not be permitted to elect to
terminate the Agreement; and provided further, that if a Change in Control
occurs after an Employee has elected to terminate the Agreement but before
the next Anniversary Date on which such termination is to be effective,
then the Employee's election will be ineffective and the Agreement Period
shall be automatically extended despite such Employee's election. If an
Employee elects to terminate the Agreement in accordance with the
foregoing, then only for the purpose of measuring the Non-competition
Period described in Paragraph 6, the Anniversary Date on which the
Agreement Period ends with respect to such Employee shall be treated as the
Employee's Termination Date resulting from the Employee's voluntary
resignation. Notwithstanding any provision of this Agreement to the
contrary, nothing in this Agreement shall be construed as limiting the
Employee's right to resign at any time and nothing in this Agreement shall
be construed as limiting the Company's right to discharge the Employee at
any time.
<PAGE>
2. PERFORMANCE OF DUTIES. The Employee agrees that, during the
Agreement Period while he is employed by the Company, he will devote his
full business time, energy and talents to providing services for the
Company in the position specified in Appendix A, which Appendix A is made
part of this Agreement, and that he may be required to perform his duties
under this Agreement at such locations within or outside the United States
as may be designated from time to time by the Company and shall serve as an
officer and/or Trustee of the Company or any AMLI entity without additional
compensation. The Employee shall have such duties and responsibilities as
may be assigned to him from time to time by the Company, including, but not
limited to, those duties specified in Appendix A hereto. The Employee
shall perform all duties assigned to him faithfully and efficiently,
subject to the direction of the Company and shall have such authorities and
powers as are inherent to the undertakings applicable to his position and
necessary to carry out the responsibilities and duties required of him
hereunder.
3. COMPENSATION. Subject to the terms and conditions of this
Agreement, Employee shall be compensated by the Company for his services
rendered hereunder as follows:
(a) SALARY. The Employee shall receive as of the Effective
Date the annual base salary specified in Appendix A hereto (the "Salary"),
which Salary shall be payable in accordance with the Company's customary
payroll practices as in effect from time to time during the term of his
employment. The Employee's Salary rate shall be reviewed at least annually
by the Company in accordance with the Company's customary salary review
procedures as in effect from time to time during the term of his
employment.
(b) BONUS. The Employee may become entitled to receive
bonuses as determined solely within the discretion of the Company.
(c) FRINGE BENEFITS AND PERQUISITES. Except as
specifically provided to the contrary in this Agreement, the Employee shall
be provided with the welfare benefits and other fringe benefits to the same
extent and on the same terms as those benefits are provided by the Company
from time to time to the Company's other senior management employees, plus
any additional benefits listed on Exhibit A hereto.
(d) EXPENSES. The Employee shall be reimbursed by the
Company, on terms and conditions that are substantially similar to those
that apply to other similarly situated senior management employees of the
Company, for reasonable expenses for entertainment, travel, meals, lodging
and similar items in accordance with and subject to the Company's expense
reimbursement policies and procedures as in effect from time to time.
4. RIGHTS AND PAYMENTS UPON TERMINATION. The Employee's right to
benefits and payments, if any, for periods after the date on which his
employment with the Company terminates for any reason (his "Termination
Date") shall be determined in accordance with this Paragraph 4:
(a) MINIMUM PAYMENTS. If the Employee's Termination Date
occurs during the Agreement Period for any reason, then the Employee shall
be entitled to the following payments, in addition to any payments or
benefits to which the Employee may be entitled under the following
provisions of this Paragraph 4 (other than this subparagraph (a)):
(i) his earned but unpaid Salary for the period
ending on his Termination Date; and
<PAGE>
(ii) his accrued but unpaid vacation pay for the
period ending with his Termination Date, as determined in accordance with
the Company's policy as in effect from time to time.
Payments to be made to the Employee pursuant to this
subparagraph 4(a) shall be made in a lump sum as soon as practicable after
the Employee's Termination Date. Except as may be otherwise expressly
provided to the contrary in this Agreement, nothing in this Agreement shall
be construed as requiring the Employee to be treated as employed by the
Company following his Termination Date for purposes of any employee benefit
plan or arrangement in which he may participate at such time, except to the
extent required by law.
(b) TERMINATION BY COMPANY FOR CAUSE. If the Employee's
Termination Date occurs during the Agreement Period and is a result of the
Company's termination of the Employee's employment on account of Cause (as
defined below), then, except as agreed in writing between the Employee and
the Company, the Employee shall have no right to future payments or
benefits under this Agreement (and the Company shall have no obligation to
make any such future payments or provide any such future benefits) for
periods after the Employee's Termination Date. For purposes of this
Agreement, the term "Cause" shall mean (1) the willful and continued
failure of the Employee to substantially perform his duties (other than any
such failure resulting from the Employee's incapacity due to physical or
mental illness) which failure has not been corrected by the Employee within
30 days after the Company has given the Employee written notice of such
failure, (2) the willful engaging by the Employee in conduct which is
demonstrably and materially injurious to the Company or AMLI, monetarily or
otherwise, (3) conduct by the Employee that involves theft, fraud or
dishonesty, (4) other acts of moral turpitude by the Employee, or (5) the
Employee's violation of the provisions of Paragraphs 5 or 6 hereof. No
act, or failure to act, on the Employee's part shall be deemed "willful"
unless done, or omitted to be done, by him not in good faith and without
reasonable belief that the action or omission was in the best interest of
AMLI.
(c) TERMINATION BY THE COMPANY FOR REASONS OTHER THAN CAUSE.
If the Employee's Termination Date occurs during the Agreement Period and
is a result of the Employee's termination of employment by the Company for
any reason other than Cause (and is not on account of the Employee's death,
disability, or voluntary resignation, the mutual agreement of the parties
or any other reason), then the Employee shall receive from the Company,
payments under Paragraph 4(a) and such other severance benefits, if any, as
determined by the Company. Notwithstanding the foregoing, the Company may,
at any time, relieve the Employee of his duties for a specified period of
time and such action on the part of the Company shall not be considered a
termination of the Employee's employment hereunder. During any period that
the Employee has been relieved of his duties pursuant to the foregoing
sentence, all provisions of this Agreement, other than the provisions of
Paragraphs 2 which require the Employee to actively perform services for
the Company, shall continue to remain in full force and effect.
<PAGE>
(d) TERMINATION FOR VOLUNTARY RESIGNATION, MUTUAL AGREEMENT
OR OTHER REASONS. If the Employee's Termination Date occurs during the
Agreement Period on account of his voluntary resignation, death,
disability, mutual agreement of the parties, or any reason other than those
specified in subparagraphs (b) or (c) above then, except as described in
Paragraphs 9 and 10, or as agreed in writing between the Employee and the
Company, the Employee shall have no right to future payments or benefits
under this Agreement (and the Company shall have no obligation to make any
such future payments or provide any such future benefits) for periods after
the Employee's Termination Date. For purposes of this Agreement, the term
"disability" shall mean with respect to an Employee, that the Employee is
eligible for long term disability benefits under the long term disability
plan maintained by the Company, or as otherwise determined in the sole
discretion of the Company.
Notwithstanding any other provision of this Agreement, the Employee shall
automatically cease to be an officer and/or Trustee of the Company and any
AMLI entity as of his Termination Date.
5. CONFIDENTIALITY. Except as may be required by the lawful order
of a court or agency of competent jurisdiction, or except to the extent
that the Employee has express authorization from the Company, he shall keep
secret and confidential indefinitely all non-public information (including,
without limitation, information regarding litigation and pending
litigation) concerning AMLI which was acquired by or disclosed to the
Employee during the course of his employment with AMLI, or during the
course of his consultation, if any, with AMLI following his termination of
employment and not to disclose the same, either directly or indirectly, to
any other person, firm, or business entity, or to use it in any way.
Nothing in the foregoing provisions of this Paragraph 5 shall be construed
so as to prevent Employee from using, in connection with his employment for
himself or an employer other than AMLI, knowledge that was acquired by him
during the course of his employment with AMLI and which is generally known
to persons of his experience in other companies in the same industry.
6. NON-COMPETITION. Other than with respect to any specific
activity, position, and entity listed on Exhibit B, which Exhibit B is made
a part of this Agreement, Employee agrees that during the term of his
employment by the Company and for the period specified in Appendix A hereto
following his Termination Date (the "Non-competition Period"), he will not
directly or indirectly engage in, assist, perform services for, establish
or open, have any equity interest (other than ownership of 10% or less of
the outstanding stock of any corporation listed on the New York or American
Stock Exchange or included in the National Association of Securities
Dealers Automated Quotation System) or have any other ownership interest
(other than ownership of 10% or less of a non-publicly-owned business
entity as a limited partner with no active participation in the operation
of the entity) in any person, firm, corporation, or business entity
(whether as an employee, officer, director, agent, security holder,
creditor, consultant, or otherwise) that engages in any activity in the
Non-competition Area, which activity is the same as, substantially similar
to, or competitive with (i) the management or leasing of any Residential
Property, (ii) the acquisition, ownership, operation or development of any
Residential Property, (iii) the business of Advising, or (iv) any other
business in which AMLI has material operations or devoted materials
resources to establishing material operations during the period to which
this Paragraph 6 relates. For purposes of this Paragraph 6, "Residential
Property" means rental real property of 100 units or more that is or is
planned to be used for rental multi-family residential purposes, and
"Advising" means raising capital from institutional investors or investment
in Residential Property in a co-investment structure where the investment
objectives are the same or similar to AMLI's. For purposes of this
Paragraph 6, "Non-competition Area" means the metropolitan areas of
Dallas/Fort Worth, Austin, and Houston, Texas; Atlanta, Georgia; Chicago,
<PAGE>
Illinois; Indianapolis, Indiana; Kansas City, Kansas (known as Eastern
Kansas); and any other area within a 15-mile radius of where AMLI is
conducting or has reasonable expectation of commencing business activities
during the Non-competition Period. Notwithstanding the foregoing, if the
Employee's employment is terminated by the Company either (a) for any
reason other than Cause, as defined in Paragraph 4, or (b) for any reason
following a Change in Control (as such term is defined in Paragraph 9),
then the restrictions of the preceding sentence shall cease to apply to the
Employee effective as of his Termination Date. In the event this covenant
is more restrictive than permitted by the law of the jurisdiction in which
the Company seeks enforcement thereof, this covenant shall be limited to
the minimum extent necessary to comply with applicable law. Nothing in
this Paragraph 6 shall be construed as limiting the Employee's duty of
loyalty to the Company and while he is employed by the Company, or any
other duty he may otherwise have to the Company and AMLI while he is
employed by the Company.
7. REMEDIES. Employee acknowledges that the Company would be
irreparably injured by a violation of Paragraphs 5 and 6 and agrees that
the Company, in addition to other remedies available to it for such breach
or threatened breach, shall be entitled to a preliminary injunction,
temporary restraining order, or any other equivalent relief, restraining
the Employee from any actual or threatened breach of Paragraphs 5 or 6
without any bond or other security being required.
8. TERMINATION OF EMPLOYMENT. The Employee shall have no right to
benefits and payments for periods after the date on which his employment
with the Company terminates for any reason, except as provided in
Paragraphs 4, 9 and 10 of this Agreement.
9. PAYMENT UPON CHANGE IN CONTROL AND CHANGE IN CIRCUMSTANCES.
Subject to the provisions of this Paragraph 9 and Paragraph 10:
(a) In the event of both a Change of Control and a Change
in Circumstance, as such terms are defined below, the Company will pay to
the Employee by wire transfer or cashier's check, within ten days after the
date of the Change in Circumstance, an amount equal to the Employee's
"Average Compensation from the Company," as hereinafter defined, multiplied
by the number specified in Appendix A hereto. The Employee's "Average
Compensation from the Company" shall be equal to the Employee's average
annual Salary, as defined in Paragraph 3, plus cash bonus and fringe
benefits, both as described in Paragraph 3, from the Company that was
includible in his gross income for federal income tax purposes, unreduced
for any salary deferrals or salary reduction elections, for the most recent
five taxable years, ending on the date immediately prior to the Change in
Circumstance; provided, however, that for purposes of this Paragraph 9, the
cash bonus for a year shall include the cash bonus that is attributable to
that year as determined by the Company in its award of bonuses for a year,
regardless of when the cash bonus is actually paid to the Employee or
includible in the Employee's gross income; and provided further that a cash
bonus shall not include cash payments, if any, from the AMLI Residential
Properties Performance Incentive Plan, or any similar stock-based incentive
plan. If for any year an Employee has been employed by the Company for
less than a full year, the Employee's compensation taken into account for
the partial year in determining the Employee's Average Compensation from
the Company shall be determined as if the Employee's Salary and fringe
benefits paid during such partial year had been paid at the same rate for
an entire year; and the cash bonus attributable to that partial year shall
be taken into account for that year, unless the Company has not yet
determined the bonus attributable to that year, in which case the cash
bonus taken into account for the partial year shall be
<PAGE>
deemed to be the cash bonus, if any, awarded to the Employee
which is attributable to the year immediately prior to the partial year.
If an Employee has been employed less than five years, such Average
Compensation from the Company shall be based on the number of full and
partial years that the Employee has been employed by the Company. For any
Employee employed by the Company before January 1, 1998, periods of
employment with the Company before such date will not be taken into account
in determining the Average Compensation from the Company of such Employee.
(b) If an Employee terminates employment or is terminated
from employment for any reason (other than Cause) following or in
connection with both a Change of Control and a Change in Circumstance, the
Employee and his eligible dependents will be entitled to continue to be
covered at the Company's expense under the Company's health, dental, life
insurance, and disability welfare plans as in effect at the Employee's
termination of Employment, or comparable plans, for a period of two years
following the date of the such termination of employment; provided however,
that such benefits shall cease upon the Employee's employment by a new
entity under which comparable benefits are available.
(c) If an Employee seeks to interpret or enforce his
rights under this Agreement following a Change in Control, regardless of
whether a Change in Circumstances also occurs, all reasonable costs and
expenses (including fees and disbursements of counsel) incurred by the
Employee in seeking to interpret or enforce rights pursuant to this
Agreement shall be paid on behalf of or reimbursed to the Employee promptly
by the Company, whether or not the Employee is successful in asserting such
rights; provided, however, that no reimbursement shall be made of such
expenses relating to any unsuccessful assertion of rights if and to the
extent that Employee's assertion of such rights was in bad faith or
frivolous, as determined by independent counsel mutually acceptable to the
Employee and the Company.
(d) "Change in Control" shall mean the occurrence of any
of the following:
(i) any Person other than:
a trustee or other fiduciary of securities
held under an employee benefit plan of the REIT or an employee benefit plan
of an Affiliate of the REIT;
a corporation or trust owned, directly or
indirectly, by the present shareholders on the Effective Date of the REIT
in substantially the same proportions as their ownership of the REIT;
any Person in which the Employee has a
substantial (10% or greater) equity interest;
AMLI Realty Co. ("ARC"), the Employee, UICI,
or their respective Affiliates and families; or
a Person that acquires Shares pursuant to a
Business Combination (as defined below) which is approved by the
shareholders of the REIT and which complies with subparagraph (iv) of this
definition;
<PAGE>
is or becomes a beneficial owner (as defined in Rule
13d-3 under the Securities Exchange Act of 1934, as amended), directly or
indirectly, of Shares representing 25% or more of the total voting power of
the REIT's then outstanding shares of beneficial interest, or of 25% or
more of the then outstanding Units of the Operating Partnership;
(ii) a tender offer is made for the shares of
beneficial interest of the REIT and the Person making the offer owns or has
accepted for payment Shares representing 25% or more of the total voting
power of the REIT's then outstanding shares of beneficial interest, or of
25% or more of the then outstanding Units of the Operating Partnership;
(iii) The majority of the REIT's Board of Trustees
consists of individuals other than Incumbent Trustees, which term means the
members of the REIT's Board of Trustees on the date of this Agreement;
provided that any individual becoming a Trustee subsequent to such date
whose election or nomination for election was supported by 2/3 of the
Trustees who then comprised Incumbent Trustees shall be considered to be an
Incumbent Trustee; or
(iv) the shareholders of the REIT approve a
reorganization, merger, consolidation or sale of all or substantially all
of the assets of the Company, the REIT, or the Operating Partnership (a
"Business Combination") with or to any other Person (other than, the
Employee, UICI, or their respective Affiliates) other than a Business
Combination which (a) would not result in any Person (other than Employee,
or UICI or their respective Affiliates) owning, directly or indirectly, 50%
or more of the combined voting power of the REIT's or such surviving
entity's outstanding voting securities, or of the Operating Partnership's
Units, immediately after such Business Combination.
(e) "Change in Circumstances" means the occurrence of any
of the following within eighteen months of a Change in Control while the
Employee is employed by the Company:
(i) a reduction in the Employee's job title or
job responsibility from that in effect immediately prior to the Change in
Control;
(ii) a reduction in the Employee's compensation,
as described in Paragraph 3, as in effect immediately prior to the Change
in Control;
(iii) the Employee's relocation to a location not
within fifty miles of his office or job location on the date of the Change
in Control, except for required travel on the Company's business to an
extent substantially consistent with his business travel obligations as in
effect immediately prior to the Change in Control; or
<PAGE>
(iv) the Employee's involuntary termination of
employment by the Company without Cause.
For purposes of this Paragraph 9, "Person" means an individual,
corporation, partnership, trust, unincorporated association or any other
legal entity, and collectively shall include any group of two or more
Persons acting in concert. "Affiliate" with regard to a Person, means a
Person that controls or is controlled by such Person. For purposes of this
definition, "control" when used with respect to any Person means the power
to direct the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise. The term
"Affiliates" and "Affiliated" shall have correlative meanings. For
purposes of this Paragraph 9, neither the Company, the REIT, the Operating
Partnership, ARC, nor UICI shall be deemed an Affiliate of the Employee.
"Shares" means the Common Shares, together with the Preferred Shares, of
the REIT. "Common Shares" means common shares of beneficial interest of
the REIT, par value $0.01 per share. "Preferred Shares" means the
preferred shares of beneficial interest of the REIT, par value $0.01 per
share. "Unit" means a unit of limited partnership interest in the
Operating Partnership.
10. EXCISE TAX GROSS-UP. If the Employee becomes entitled to
payment in accordance with subparagraph 9(a), then with respect to such
payment under subparagraph 9(a) (and with respect to any other payment made
to the Employee upon a Change in Control, including without limitation, the
vesting of an option or other cash or non-cash benefit or property, whether
pursuant to the terms of this Agreement or any other plan, arrangement, or
agreement with the Company or any other AMLI entity) (the "Total
Payments"), if such Total Payments are or become subject to the tax imposed
by Section 4999 of the Internal Revenue Code of 1986, as amended (the
"Code") (or any similar tax that may hereafter be imposed) (the "Excise
Tax"), the Company shall pay to Employee at the time specified below an
additional amount (the "Gross-up Payment") (which shall include, without
limitation, reimbursement for any penalties and interest that may accrue in
respect of such Excise Tax) such that the net amount retained by Employee,
after reduction for any Excise Tax (including any penalties or interest
thereon) on the Total Payments and after any reduction for any federal,
state and local income or employment tax and Excise Tax on the Gross-up
Payment provided for by this Paragraph 10, but before reduction for any
federal, state, or local income or employment tax on the Total Payments,
shall be equal to the sum of (a) and (b), where (a) is the Total Payments,
and (b) is an amount equal to the product of any deductions disallowed for
federal, state, or local income tax purposes because of the inclusion of
the Gross-up Payment in Employee's adjusted gross income multiplied by the
highest applicable marginal rate of federal, state, or local income
taxation, respectively, for the calendar year in which the Gross-up Payment
is to be made.
11. WITHHOLDING. All compensation payable under this Agreement
shall be subject to customary withholding taxes and other employment taxes
as required with respect to compensation paid to an employee and the amount
of compensation payable hereunder shall be reduced appropriately to reflect
the amount of any required withholding. Except as expressly provided to
the contrary in this Agreement, the Company shall have no obligation to
make any payments to the Employee or to make the Employee whole for the
amount of any required taxes.
12. WAIVER OF BREACH. The waiver by either the Company or Employee
of a breach of any provision of this Agreement shall not operate as or be
deemed a waiver of any subsequent breach by either the Company or Employee
of that provision or any other provision hereof. Continuation of any
payments hereunder by the Company following a breach by Employee of any
provisions of this Agreement shall not preclude the Company from thereafter
terminating said payments based upon the same violation.
<PAGE>
13. SEVERABILITY. In the event that any provision or portion of
this Agreement shall be determined to be invalid or unenforceable for any
reason, such provision shall be limited to the minimum extent necessary to
comply with applicable law, and the remaining provisions of this Agreement
shall be unaffected thereby and shall remain in full force and effect.
14. NOTICES. Any notice, request, demand, and other communication
provided for by this Agreement shall be sufficient if in writing and if
sent by registered or certified mail, or by nationally-recognized courier
service, confirmed fax, or confirmed personal delivery to the Employee at
the last address he has filed in writing with the Company or in the case of
the Company, to the attention of the Secretary of AMLI Residential
Properties Trust, with a copy to the attention of the President of the REIT
at its principal place of business, in the case of both notice to the
Company and notice to the Employee.
15. SUCCESSORS TO THE COMPANY. This Agreement shall be binding
upon, and inure to the benefit of, the Company and its successors and
assigns.
16. NONALIENATION. The interests of Employee under this Agreement
are not subject to the claims of his creditors, and may not otherwise be
voluntarily or involuntarily assigned, alienated or encumbered.
17. AMENDMENT. This Agreement may be amended or canceled only by
mutual agreement of the parties in writing without the consent of any other
person.
18. APPLICABLE LAW. The provisions of this Agreement shall be
construed in accordance with the internal laws of the State of Illinois,
excluding any choice of law rules.
19. SURVIVAL OF AGREEMENT. Except as otherwise expressly provided
in this Agreement, the rights and obligations of the parties to this
Agreement shall survive the termination of the Employee's employment with
the Company.
20. ENTIRE AGREEMENT. This Agreement constitutes the full and
complete understanding and agreement of the parties hereto, and supersedes
all prior understandings and agreements of the parties hereto, whether oral
or written, as to the subject matter hereof.
21. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, any one of which shall be deemed the original without
reference to the others.
22. ACKNOWLEDGMENT BY EMPLOYEE. The Employee represents to the
Company that he is knowledgeable and sophisticated as to business matters,
including the subject matter of this Agreement, that he has read this
Agreement and that he understands its terms. The Employee acknowledges
that, prior to assenting to terms the terms of this Agreement, he has been
given a reasonable time to review it, to consult with counsel of his
choice, and to negotiate at arm's-length with the Company as to the
contents. The Employee and the Company agree that the language used in
this Agreement is the language chosen by the parties to express their
mutual intent, and that no rule of strict construction is to be applied
against any party hereto. Employee warrants that he is not subject to any
non-competition agreement or other restrictive agreement with any other
prior employer or any other person that would restrict his ability to
perform the services required of him under this Agreement.
<PAGE>
IN WITNESS THEREOF, Employee has hereunto set his hand, and the
Company has caused these presents to be executed in its name and on its
behalf, all as of the day and year first above written.
/S/ ROBERT J. CHAPMAN
------------------------------
Employee
AMLI RESIDENTIAL PROPERTIES TRUST
By /S/ ALLAN J. SWEET
-----------------------
Its President
-----------------------
<PAGE>
Exhibit A to Employment Agreement for
-------------------------------------
ROBERT CHAPMAN
--------------
TITLE:
(ref. Paragraph 1) Executive Vice President & Chief Financial
Officer of AMLI Residential Properties Trust.
RESPONSIBILITIES:
(ref. Paragraph 2) Responsible for AMLI's debt and equity
financing activities, as well as management responsibility for AMLI's
Accounting and Treasury, Management Information Systems, and Human
Resources departments. In addition, has certain responsibilities for
Investor Relations.
ANNUAL BASE SALARY
AS OF EFFECTIVE DATE:
(ref. Paragraph 3.a) $200,000
FRINGE BENEFITS:
(ref. Paragraph 3.c) Cost of income tax preparation.
Reimbursement for club dues.
PAYMENT MULTIPLE:
(ref. Paragraph 9.a) 3x
NON-COMPETITION PERIOD:
(ref. Paragraph 6) 2 years
EXHIBIT 10.7
- ------------
$200,000,000
AMENDED AND RESTATED CREDIT AGREEMENT
dated as of
July 27, 1998
among
AMLI RESIDENTIAL PROPERTIES, L.P.
The Banks Listed Herein,
WACHOVIA BANK, N.A.,
as Agent
and
THE FIRST NATIONAL BANK OF CHICAGO,
as Documentation Agent
and
DRESDNER BANK AG, NEW
YORK AND GRAND CAYMAN BRANCHES,
as Co-Agent
<PAGE>
TABLE OF CONTENTS
CREDIT AGREEMENT
----------------
ARTICLE I
DEFINITIONS. . . . . . . . . . . . . . . 1
SECTION 1.01. DEFINITIONS. . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1.02. ACCOUNTING TERMS AND DETERMINATIONS. . . . . . . . . . 16
SECTION 1.03. REFERENCES . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 1.04. USE OF DEFINED TERMS . . . . . . . . . . . . . . . . . 16
SECTION 1.05. TERMINOLOGY. . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE II
THE CREDITS. . . . . . . . . . . . . . . 16
SECTION 2.01. COMMITMENTS TO LEND SYNDICATED LOANS . . . . . . . . . 16
SECTION 2.02. METHOD OF BORROWING SYNDICATED LOANS . . . . . . . . . 18
SECTION 2.03. MONEY MARKET LOANS . . . . . . . . . . . . . . . . . . 19
SECTION 2.04. NOTES. . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 2.05. MATURITY OF LOANS. . . . . . . . . . . . . . . . . . . 23
SECTION 2.06. INTEREST RATES . . . . . . . . . . . . . . . . . . . . 24
SECTION 2.07. FEES . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 2.08. OPTIONAL TERMINATION OR REDUCTION OF COMMITMENTS . . . 26
SECTION 2.09. MANDATORY REDUCTION AND TERMINATION OF COMMITMENTS . . 26
SECTION 2.10. OPTIONAL PREPAYMENTS . . . . . . . . . . . . . . . . . 26
SECTION 2.11. MANDATORY PREPAYMENTS. . . . . . . . . . . . . . . . . 26
SECTION 2.12. GENERAL PROVISIONS AS TO PAYMENTS. . . . . . . . . . . 27
SECTION 2.13. COMPUTATION OF INTEREST AND FEES . . . . . . . . . . . 28
ARTICLE III
CONDITIONS TO BORROWINGS. . . . . . . . . . . . 28
SECTION 3.01. CLOSING CONDITIONS . . . . . . . . . . . . . . . . . . 28
SECTION 3.02. CONDITIONS TO ALL BORROWINGS . . . . . . . . . . . . . 30
ARTICLE IV
REPRESENTATIONS AND WARRANTIES . . . . . . . . . . 30
SECTION 4.01. PARTNERSHIP, TRUST AND CORPORATE EXISTENCE AND
POWER. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 4.02. CORPORATE AND GOVERNMENTAL AUTHORIZATION; NO
CONTRAVENTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.03. BINDING EFFECT . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.04. FINANCIAL INFORMATION. . . . . . . . . . . . . . . . . 31
SECTION 4.05. NO LITIGATION. . . . . . . . . . . . . . . . . . . . . 31
SECTION 4.06. COMPLIANCE WITH ERISA. . . . . . . . . . . . . . . . . 31
SECTION 4.07. COMPLIANCE WITH LAWS; PAYMENT OF TAXES . . . . . . . . 32
SECTION 4.08. SUBSIDIARIES, CO-INVESTMENT PARTNERSHIPS AND
SERVICE COMPANIES. . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.09. INVESTMENT COMPANY ACT . . . . . . . . . . . . . . . . 32
SECTION 4.10. PUBLIC UTILITY HOLDING COMPANY ACT . . . . . . . . . . 32
SECTION 4.11. OWNERSHIP OF PROPERTY; LIENS . . . . . . . . . . . . . 32
SECTION 4.12. NO DEFAULT . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 4.13. FULL DISCLOSURE. . . . . . . . . . . . . . . . . . . . 33
SECTION 4.14. ENVIRONMENTAL MATTERS. . . . . . . . . . . . . . . . . 33
SECTION 4.15. CAPITAL STOCK. . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.16. MARGIN STOCK . . . . . . . . . . . . . . . . . . . . . 33
SECTION 4.17. INSOLVENCY . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.18. INSURANCE. . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 4.19. REAL ESTATE INVESTMENT TRUST; SOLE GENERAL PARTNER . . 34
SECTION 4.20. YEAR 2000 COMPLIANCE . . . . . . . . . . . . . . . . . 34
ARTICLE V
COVENANTS . . . . . . . . . . . . . . . 34
SECTION 5.01. INFORMATION. . . . . . . . . . . . . . . . . . . . . . 34
SECTION 5.02. INSPECTION OF PROPERTY, BOOKS AND RECORDS. . . . . . . 36
SECTION 5.03. MAINTENANCE OF EXISTENCE . . . . . . . . . . . . . . . 36
SECTION 5.04. DISSOLUTION. . . . . . . . . . . . . . . . . . . . . . 36
SECTION 5.05. CONSOLIDATIONS, MERGERS AND SALES OF ASSETS. . . . . . 36
SECTION 5.06. USE OF PROCEEDS. . . . . . . . . . . . . . . . . . . . 37
SECTION 5.07. COMPLIANCE WITH LAWS; PAYMENT OF TAXES . . . . . . . . 37
SECTION 5.08. INSURANCE. . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 5.09. CHANGE IN FISCAL YEAR. . . . . . . . . . . . . . . . . 37
SECTION 5.10. MAINTENANCE OF PROPERTY. . . . . . . . . . . . . . . . 38
SECTION 5.11. ENVIRONMENTAL NOTICES. . . . . . . . . . . . . . . . . 38
SECTION 5.12. ENVIRONMENTAL MATTERS. . . . . . . . . . . . . . . . . 38
SECTION 5.13. ENVIRONMENTAL RELEASE. . . . . . . . . . . . . . . . . 38
SECTION 5.14. TRANSACTIONS WITH AFFILIATES . . . . . . . . . . . . . 38
SECTION 5.15. RESTRICTED PAYMENTS. . . . . . . . . . . . . . . . . . 38
SECTION 5.16. LOANS OR ADVANCES. . . . . . . . . . . . . . . . . . . 39
SECTION 5.17. INVESTMENTS. . . . . . . . . . . . . . . . . . . . . . 39
SECTION 5.18. LIENS ON ELIGIBLE PROPERTY . . . . . . . . . . . . . . 40
SECTION 5.19. RESTRICTIONS ON ABILITY OF GUARANTORS TO PAY
DIVIDENDS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 5.20. RATIO OF TOTAL CONSOLIDATED LIABILITIES TO
UNDEPRECIATED BOOK ASSET VALUE . . . . . . . . . . . . . . . . . . . . . 40
SECTION 5.21. RATIO OF TOTAL SECURED DEBT TO GROSS ASSET VALUE. . . 40
SECTION 5.22. RATIO OF EBITDA TO CONSOLIDATED INTEREST EXPENSE . . . 40
SECTION 5.23. RATIO OF UNENCUMBERED ASSETS TO UNSECURED FUNDED
DEBT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 5.24. RATIO OF UNSECURED NET OPERATING INCOME TO
UNSECURED INTEREST EXPENSE . . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 5.25. ADDITIONAL DEBT. . . . . . . . . . . . . . . . . . . . 41
SECTION 5.26. CO-INVESTMENT PARTNERSHIPS DEPRECIATED BOOK VALUE.
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 5.27. STATUS AS A REIT . . . . . . . . . . . . . . . . . . . 41
SECTION 5.28. NEW SUBSIDIARIES TO BECOME GUARANTORS. . . . . . . . . 41
SECTION 5.29. SERVICE COMPANY DISTRIBUTIONS. . . . . . . . . . . . . 41
SECTION 6.01. EVENTS OF DEFAULT. . . . . . . . . . . . . . . . . . . 41
SECTION 6.02. NOTICE OF DEFAULT. . . . . . . . . . . . . . . . . . . 44
ARTICLE VII
THE AGENT . . . . . . . . . . . . . . . 44
SECTION 7.01. APPOINTMENT; POWERS AND IMMUNITIES . . . . . . . . . . 44
SECTION 7.02. RELIANCE BY AGENT. . . . . . . . . . . . . . . . . . . 44
SECTION 7.03. DEFAULTS . . . . . . . . . . . . . . . . . . . . . . . 45
SECTION 7.04. RIGHTS OF AGENT AND ITS AFFILIATES AS A BANK . . . . . 45
SECTION 7.05. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . 45
SECTION 7.06 CONSEQUENTIAL DAMAGES. . . . . . . . . . . . . . . . . . . 45
SECTION 7.07. PAYEE OF NOTE TREATED AS OWNER . . . . . . . . . . . . 46
SECTION 7.08. NONRELIANCE ON AGENT AND OTHER BANKS . . . . . . . . . 46
SECTION 7.09. FAILURE TO ACT . . . . . . . . . . . . . . . . . . . . 46
SECTION 7.10. RESIGNATION OR REMOVAL OF AGENT. . . . . . . . . . . . 46
SECTION 7.11. DOCUMENTATION AGENT. . . . . . . . . . . . . . . . . . 46
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION . . . . . . . . 47
SECTION 8.01. BASIS FOR DETERMINING INTEREST RATE INADEQUATE OR
UNFAIR . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 8.02. ILLEGALITY . . . . . . . . . . . . . . . . . . . . . . 47
SECTION 8.03. INCREASED COST AND REDUCED RETURN. . . . . . . . . . . 47
SECTION 8.04. BASE RATE LOANS SUBSTITUTED FOR EURO-DOLLAR LOANS. . . 48
SECTION 8.05. COMPENSATION . . . . . . . . . . . . . . . . . . . . . 49
ARTICLE IX
MISCELLANEOUS . . . . . . . . . . . . . . 49
SECTION 9.01. NOTICES. . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 9.02. NO WAIVERS . . . . . . . . . . . . . . . . . . . . . . 50
SECTION 9.03. EXPENSES; DOCUMENTARY TAXES. . . . . . . . . . . . . . 50
SECTION 9.04. INDEMNIFICATION. . . . . . . . . . . . . . . . . . . . 50
SECTION 9.05. SETOFF; SHARING OF SETOFFS . . . . . . . . . . . . . . 50
SECTION 9.06. AMENDMENTS AND WAIVERS . . . . . . . . . . . . . . . . 51
SECTION 9.07. NO MARGIN STOCK COLLATERAL . . . . . . . . . . . . . . 52
SECTION 9.08. SUCCESSORS AND ASSIGNS . . . . . . . . . . . . . . . . 52
SECTION 9.09. CONFIDENTIALITY. . . . . . . . . . . . . . . . . . . . 53
SECTION 9.10. REPRESENTATION BY BANKS. . . . . . . . . . . . . . . . 54
SECTION 9.11. OBLIGATIONS SEVERAL. . . . . . . . . . . . . . . . . . 54
SECTION 9.12. GEORGIA LAW. . . . . . . . . . . . . . . . . . . . . . 54
SECTION 9.13. SEVERABILITY . . . . . . . . . . . . . . . . . . . . . 54
SECTION 9.14. INTEREST . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 9.15. INTERPRETATION . . . . . . . . . . . . . . . . . . . . 55
SECTION 9.16. WAIVER OF JURY TRIAL; CONSENT TO JURISDICTION. . . . . 55
SECTION 9.17. COUNTERPARTS . . . . . . . . . . . . . . . . . . . . . 55
SECTION 9.18. SOURCE OF FUNDS -- ERISA . . . . . . . . . . . . . . . 55
SECTION 9.19. EXCULPATION. . . . . . . . . . . . . . . . . . . . . . 55
EXHIBIT A-1 Form of Syndicated Loan Note
EXHIBIT A-2 Form of Swing Loan Note
EXHIBIT B Form of Opinion of Counsel for the Borrower
EXHIBIT C Form of Opinion of Special Counsel for the Agent
EXHIBIT D Form of Assignment and Acceptance
EXHIBIT E Form of Notice of Borrowing
EXHIBIT F Form of Compliance Certificate
EXHIBIT G Form of Closing Certificate
EXHIBIT H Form of Officer's Certificate and Agreement for the
General Partner of the Borrower
EXHIBIT I Form of Borrowing Base Certificate
EXHIBIT J List of Eligible Properties
EXHIBIT K Form of Guaranty
EXHIBIT L Form of Contribution Agreement
Schedule 4.08 Subsidiaries and Co-Investment Partnerships
Schedule 4.14 Environmental Matters
Schedule 5.17 Existing Investments
<PAGE>
AMENDED AND RESTATED CREDIT AGREEMENT
AMENDED AND RESTATED CREDIT AGREEMENT dated as of July 27, 1998
among AMLI RESIDENTIAL PROPERTIES, L.P., the BANKS listed on the signature
pages hereof, WACHOVIA BANK, N.A., as Agent, and THE FIRST NATIONAL BANK OF
CHICAGO, as Documentation Agent.
WHEREAS, the Borrower, the Banks, the Agent and the
Documentation Agent are party to the Existing Credit Agreement and desire
to provide an additional facility for Money Market Loans and increase to
Commitments to $180,000,000 as of the date hereof, and, upon the addition
of an additional Bank, to $200,000,000.
The parties hereto agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. DEFINITIONS. The terms as defined in this
Section 1.01 shall, for all purposes of this Agreement and any amendment
hereto (except as herein otherwise expressly provided or unless the context
otherwise requires), have the meanings set forth herein:
"Adjusted London Interbank Offered Rate" has the meaning set
forth in Section 2.06(c).
"Affiliate" of any relevant Person means (i) any Person that
directly, or indirectly through one or more intermediaries, controls the
relevant Person (a "Controlling Person"), (ii) any Person (other than the
relevant Person or a Subsidiary of the relevant Person) which is controlled
by or is under common control with a Controlling Person, or (iii) any
Person (other than a Subsidiary of the relevant Person) of which the
relevant Person owns, directly or indirectly, 20% or more of the common
stock or equivalent equity interests. As used herein, the term "control"
means possession, directly or indirectly, of the power to direct or cause
the direction of the management or policies of a Person, whether through
the ownership of voting securities, by contract or otherwise.
"Agent" means Wachovia Bank, N.A., a national banking
association organized under the laws of the United States of America, in
its capacity as agent for the Banks hereunder, and its successors and
permitted assigns in such capacity.
"Agent's Letter Agreement" means that certain letter agreement,
dated as of April 23, 1997 between the Borrower and the Agent relating to
the structure of the Loans, and certain fees from time to time payable by
the Borrower to the Agent, together with all amendments and supplements
thereto.
"Agreement" means this Amended and Restated Credit Agreement,
together with all amendments and supplements hereto.
"Applicable Margin" has the meaning set forth in Section
2.06(a).
"Approved Collateral Value" means the total value of any
Qualified Letters of Credit or any other asset delivered to the Borrower as
collateral in connection with the acquisition or development of multi-
family properties reasonably anticipated by the Borrower to become
Properties; provided, however, the Approved Collateral Value of (i) any
Qualified Letter(s) of Credit that individually or together with other
Qualified Letters of Credit exceed $20,000,000, and (ii) any asset that is
not a Qualified Letter of Credit, shall be $0 until such asset or Qualified
Letter of Credit is approved by the Required Banks, in their sole
discretion.
"Assignee" has the meaning set forth in Section 9.08(c).
<PAGE>
"Assignment and Acceptance" means an Assignment and Acceptance
executed in accordance with Section 9.08(c) in the form attached hereto as
EXHIBIT D.
"Authority" has the meaning set forth in Section 8.02.
"Bank" means each bank listed on the signature pages hereof as
having a Commitment, and its successors and assigns.
"Base Rate" means for any Base Rate Loan for any day, the rate
per annum equal to the higher as of such day of (i) the Prime Rate, or (ii)
one-half of one percent above the Federal Funds Rate. For purposes of
determining the Base Rate for any day, changes in the Prime Rate or the
Federal Funds Rate shall be effective on the date of each such change.
"Base Rate Borrowing" means a Borrowing consisting of Base Rate
Loans.
"Base Rate Loan" means a Syndicated Loan which bears or is to
bear interest at a rate based upon the Base Rate, and is to be made as a
Base Rate Loan pursuant to the applicable Notice of Borrowing, Section
2.02(f), or Article VIII, as applicable.
"Borrower" means AMLI Residential Properties, L.P., a Delaware
limited partnership, and its successors and its permitted assigns.
"Borrowing" means a borrowing hereunder consisting of (i)
Syndicated Loans made to the Borrower at the same time by all of the Banks,
in the case of a Syndicated Borrowing, (ii) Money Market Loans made
separately by one or more Banks, in the case of a Money Market Borrowing,
or (iii) a Swing Loan made by Wachovia, in each case pursuant to Article
II. A Borrowing is a "Euro-Dollar Borrowing" if such Borrowing consists of
Euro-Dollar Loans. A Borrowing is a "Base Rate Borrowing" if such
Borrowing consists of Base Rate Loans. A Borrowing is a "Transaction Rate
Borrowing" if such Borrowing consists of Transaction Rate Loans. A
Borrowing is a "Syndicated Loan Borrowing" if such Borrowing consists of
Syndicated Loans. A Borrowing is a "Swing Loan Borrowing" if such
Borrowing consists of Swing Loans. A Borrowing is a "Money Market
Borrowing" if such Borrowing consists of Money Market Loans. A Borrowing
is a "Fixed Rate Borrowing" if such Borrowing consists of Fixed Rate Loans.
"Borrowing Base" means the sum of each of the following, as
determined by reference to the most recent Borrowing Base Certificate
furnished pursuant to Section 3.01(h) or Section 5.01(h), as applicable
(and with respect to any Eligible Property which consists of phases, each
phase thereof shall be separately categorized into clause (i), (ii) or
(iii) below, as appropriate, so long as such phase could be separately
financed on a stand-alone basis):
(i) an amount equal to the product of: (x) the quotient of (1)
the Net Operating Income for the 3 month period ending on the last day of
the Fiscal Quarter just ended prior to the date of determination, from each
Eligible Unencumbered Stabilized Property, divided by (2) 0.09 (which is
the capitalization rate); times (y) 4 (which is the annualization factor);
times (z) 0.60 (which is the advance rate); plus
(ii) an amount equal to the lesser of: (A) the product of (x)
0.50 (which is the advance rate), times (y) the book value of Construction
in Progress on the last day of the Fiscal Quarter just ended on all
Eligible Properties not subject to a Mortgage and (B) $50,000,000; plus
(iii) an amount equal to the lesser of: (A) the product of (x)
0.40 (which is the advance rate), times (y) the cost of land acquired for
the purpose of apartment community development and (B) $15,000,000.
<PAGE>
"Borrowing Base Certificate" means a certificate substantially
in the form of EXHIBIT I, duly executed by an Executive Officer of the
General Partner, setting forth in reasonable detail the calculations for
each component of the Borrowing Base.
"Capital Stock" means the Partnership Interests in the Borrower
and any nonredeemable capital stock, whether common or preferred, or
partner interests, whether general or limited, in any Consolidated Entity
(to the extent issued to a Person other than the Borrower).
"CERCLA" means the Comprehensive Environmental Response
Compensation and Liability Act, 42 U.S.C. Section 9601 et. seq. and its
implementing regulations and amendments.
"CERCLIS" means the Comprehensive Environmental Response
Compensation and Liability Inventory System established pursuant to CERCLA.
"Change in Control" means: (i) any Person or two or more
Persons other than the General Partner acting in concert shall have
acquired beneficial ownership (within the meaning of Rule 13d-3 of the
Securities and Exchange Commission under the Securities Exchange Act of
1934) of 20% or more of the outstanding Partnership Interests; or (ii) as
of any date a majority of the Board of Directors of the Borrower consists
of individuals who were not either (A) directors of the Borrower as of the
corresponding date of the previous year, (B) selected or nominated to
become directors by the Board of Directors of the Borrower of which a
majority consisted of individuals described in clause (A), or (C) selected
or nominated to become directors by the Board of Directors of the Borrower
of which a majority consisted of individuals described in clause (A) and
individuals described in clause (B)
"Change of Law" shall have the meaning set forth in Section
8.02.
"Closing Certificate" has the meaning set forth in Section
3.01(e).
"Closing Date" means July 27, 1998.
"Code" means the Internal Revenue Code of 1986, as amended, or
any successor Federal tax code.
"Co-Investment Partnerships" means any Person which is not a
Consolidated Entity and which is owned (i) in part by the Borrower or any
Consolidated Entity and (ii) in part by another Person which is not an
Affiliate of the Borrower or any Consolidated Entity.
"Commitment" means, with respect to each Bank, (i) the amount
set forth opposite the name of such Bank on the signature pages hereof, and
(ii) as to any Bank which enters into any Assignment and Acceptance
(whether as transferor Bank or as Assignee thereunder), the amount of such
Bank's Commitment after giving effect to such Assignment and Acceptance, in
each case as such amount may be reduced from time to time pursuant to
Sections 2.08 and 2.09.
"Compliance Certificate" has the meaning set forth in Section
5.01(c).
"Consolidated Entity" means at any date any Subsidiary or
Service Company the accounts of which, in accordance with GAAP, are
consolidated with those of the Borrower in its consolidated financial
statements as of such date.
"Consolidated Interest Expense" for any period means interest
currently expensed under GAAP in respect of Debt of the Borrower or any of
the Consolidated Entities.
<PAGE>
"Consolidated Liabilities" means the sum of (i) all liabilities
that, in accordance with GAAP, should be classified as liabilities on a
consolidated balance sheet of Borrower and the Consolidated Entities, and
(ii) to the extent not included in clause (i) of this definition, all
Redeemable Preferred Stock.
"Consolidated Net Income" means, for any period, the Net Income
of the Borrower and its Consolidated Subsidiaries determined on a
consolidated basis, but excluding (i) extraordinary income or expense items
and (ii) any equity interests of the Borrower or any Subsidiary in the
unremitted earnings of any Person that is not a Subsidiary.
"Consolidated Total Assets" means, at any time, the total
assets of the Borrower and its Consolidated Subsidiaries, determined on a
consolidated basis, as set forth or reflected on the most recent
consolidated balance sheet of the Borrower and its Consolidated
Subsidiaries, prepared in accordance with GAAP.
"Construction in Progress" means, any Property in the process
of being developed as an apartment community but is not a Stabilized
Property, calculated on a consolidated basis for the Borrower and the
Guarantors, the construction-in-progress as shown from time to time on the
books and records of the Borrower and the Guarantors, maintained in
accordance with GAAP.
"Contribution Agreement" means the Contribution Agreement of
even date herewith in substantially the form of EXHIBIT L to be executed by
the Borrower and each of the Guarantors pursuant to Section 5.28.
"Control" means, with respect to any Person, the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities or otherwise.
"Controlled Group" means all members of a controlled group of
corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower, are treated as a
single employer under Section 414 of the Code.
"Debt" of any Person means at any date, without duplication,
(i) all obligations of such Person for borrowed money, (ii) all obligations
of such Person evidenced by bonds, debentures, notes or other similar
instruments, (iii) all obligations of such Person to pay the deferred
purchase price of property or services, except trade accounts payable
arising in the ordinary course of business, (iv) all obligations of such
Person as lessee under capital leases, (v) all obligations of such Person
to reimburse any bank or other Person in respect of amounts payable under
a banker's acceptance, (vi) all Redeemable Preferred Stock of such Person
(in the event such Person is a corporation), (vii) all obligations of such
Person to reimburse any bank or other Person in respect of amounts paid or
to be paid or to be paid under a letter of credit or similar instrument,
(viii) all Debt of others secured by a Lien on any asset of such Person,
whether or not such Debt is assumed by such Person, and (ix) all Debt of
others Guaranteed by such Person.
"Debt Rating" means at any time the published rating of a
Person's senior unsecured, unenhanced debt (or, if no such debt exists, its
issuer credit rating for debt of such type) by Moody's, S&P or Duff &
Phelps (PROVIDED, (i) that in the event of a double or greater split
rating, the rating immediately below the highest rating shall apply), and
(ii) if only one of them rates the Person's senior unsecured, unenhanced
debt, such rating must be issued by Moody's or S&P.
"Default" means any condition or event which constitutes an
Event of Default or which with the giving of notice or lapse of time or
both would, unless cured or waived, become an Event of Default.
<PAGE>
"Default Rate" means, with respect to any Loan, on any day, the
sum of 2% plus the highest interest rate (including the Applicable Margin)
which may be applicable to any Loans hereunder (irrespective of whether any
such type of Loans are actually outstanding hereunder).
"Dividends" means for any period the sum of all dividends and
other distributions paid or declared during such period in respect of any
Capital Stock and Redeemable Preferred Stock (other than dividends paid or
payable in the form of additional Capital Stock).
"Dollars" or "$" means dollars in lawful currency of the United
States of America.
"Domestic Business Day" means any day except a Saturday, Sunday
or other day on which commercial banks in Georgia are authorized by law to
close.
"EBITDA" means at any time the sum of the following,
determined on a consolidated basis for the Borrower and each Consolidated
Entity, at the end of each Fiscal Quarter, for the applicable measuring
period: (i) Consolidated Net Income; PLUS (ii) Consolidated Interest
Expense; PLUS (iii) taxes on income; PLUS (iv) depreciation; PLUS (v)
amortization; PLUS (vi) other non-cash charges.
"Economic Percentage" means the Borrower's percentage of
ownership of all preferred and common stock of any of the Service Companies
at any time.
"Eligible Property" means any Property which is either (i)
listed on EXHIBIT J or (ii) which has been approved as an Eligible Property
by the Required Banks at the request of the Borrower, taking into account
the following information concerning the Property provided to the Agent and
the Banks by the Borrower: a physical description, applicable environmental
reports, information regarding its age, location and occupancy, an
operating statement and rent roll for the most recent Fiscal Quarter, and
an operating budget for the current Fiscal Year; PROVIDED, HOWEVER, that
any Eligible Property shall be released in writing by the Agent as an
Eligible Property upon the written request of the Borrower, to enable the
Borrower to sell or obtain financing on such Eligible Property, so long as
no Default or Event of Default is in existence or would be caused thereby,
and upon such release, such Property shall no longer constitute Eligible
Property.
"Eligible Unencumbered Stabilized Property" means any Eligible
Property which (i) is not subject to a Mortgage, and (ii) is a Stabilized
Property.
"Environmental Authority" means any foreign, federal, state,
local or regional government that exercises any form of jurisdiction or
authority under any Environmental Requirement.
"Environmental Authorizations" means all licenses, permits,
orders, approvals, notices, registrations or other legal prerequisites for
conducting the business of the Borrower or any Subsidiary required by any
Environmental Requirement.
"Environmental Judgments and Orders" means all judgments,
decrees or orders arising from or in any way associated with any
Environmental Requirements, whether or not entered upon consent, or written
agreements with an Environmental Authority or other entity arising from or
in any way associated with any Environmental Requirement, whether or not
incorporated in a judgment, decree or order.
"Environmental Liabilities" means any liabilities, whether
accrued, contingent or otherwise, arising from and in any way associated
with any Environmental Requirements.
<PAGE>
"Environmental Notices" means notice from any Environmental
Authority or by any other person or entity, of possible or alleged
noncompliance with or liability under any Environmental Requirement,
including without limitation any complaints, citations, demands or requests
from any Environmental Authority or from any other person or entity for
correction of any violation of any Environmental Requirement or any
investigations concerning any violation of any Environmental Requirement.
"Environmental Proceedings" means any judicial or
administrative proceedings arising from or in any way associated with any
Environmental Requirement.
"Environmental Releases" means releases as defined in CERCLA or
under any applicable state or local environmental law or regulation.
"Environmental Requirements" means any legal requirement
relating to health, safety or the environment and applicable to the
Borrower, any Subsidiary or the Properties, including but not limited to
any such requirement under CERCLA or similar state legislation and all
federal, state and local laws, ordinances, regulations, orders, writs,
decrees and common law.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended from time to time, or any successor law. Any reference to
any provision of ERISA shall also be deemed to be a reference to any
successor provision or provisions thereof.
"Euro-Dollar Borrowing" means a Borrowing consisting of Euro-
Dollar Loans.
"Euro-Dollar Business Day" means any Domestic Business Day on
which dealings in Dollar deposits are carried out in the London interbank
market.
"Euro-Dollar Loan" means a Syndicated Loan which bears or is to
bear interest at a rate based upon the Euro-Dollar Rate, and to be made as
a Euro-Dollar Loan pursuant to the applicable Notice of Borrowing.
"Euro-Dollar Reserve Percentage" has the meaning set forth in
Section 2.06(c).
"Event of Default" has the meaning set forth in Section 6.01.
"Executive Officer" refers to an executive officer of the
General Partner, and means the Chairman, the Vice Chairman, the President,
the Chief Financial Officer or the Treasurer of the General Partner.
"Existing Credit Agreement" means that certain Credit Agreement
by and between the Borrower, the Agent, the Documentation Agent, and the
Banks listed therein, dated as of June 27, 1997, as amended by the First
Amendment to Credit Agreement dated as of November 21, 1997.
"Federal Funds Rate" means, for any day, the rate per annum
(rounded upward, if necessary, to the next higher 1/100th of 1%) equal to
the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds
brokers on such day, as published by the Federal Reserve Bank of New York
on the Domestic Business Day next succeeding such day, PROVIDED that (i) if
the day for which such rate is to be determined is not a Domestic Business
Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Domestic Business Day as so published on
the next succeeding Domestic Business Day, and (ii) if such rate is not so
published for any day, the Federal Funds Rate for such day shall be the
average rate charged to the Agent on such day on such transactions, as
determined by the Agent.
<PAGE>
"Fiscal Month" means any fiscal month of the Borrower.
"Fiscal Quarter" means any fiscal quarter of the Borrower or
the General Partner.
"Fiscal Year" means any fiscal year of the Borrower or the
General Partner.
"Fixed Rate Borrowing" means a Euro-Dollar Borrowing or a
Transaction Rate Borrowing, or either of them, as the context requires.
"Fixed Rate Loan" means any Euro-Dollar Loan, Transaction Rate
Loan or Money Market Loan, or any or all of them, as the context shall
require.
"Funds From Operations" has the meaning ascribed to such term
in preparation of financial statements for real estate investment trusts as
required by NAREIT from time to time, subject to Section 1.02.
"GAAP" means generally accepted accounting principles applied
on a basis consistent with those which, in accordance with Section 1.02,
are to be used in making the calculations for purposes of determining
compliance with the terms of this Agreement.
"General Partner" means AMLI Residential Properties Trust, a
Maryland real estate investment trust, the sole general partner of the
Borrower.
"Gross Asset Value" means, on a consolidated basis for the
Borrower and the Consolidated Entities, the sum of:
(i) an amount equal to the product of: (x) the quotient of (1)
the Net Operating Income for the 3 month period ending on the last day of
the Fiscal Quarter just ended prior to the date of determination, from each
Property (other than Property owned by Borrower for less than
three months) less, divided by (2) 0.09 (which is the
capitalization rate); times (y) 4 (which is the annualization
factor); plus
(ii) an amount equal to the book value of (A) Construction in
Progress plus (B) Properties consisting of unimproved land, as determined
on the last day of the Fiscal Quarter just ended; plus
(iii) an amount equal to the acquisition cost of improved
Properties owned by Borrower less than three months, as determined on the
last day of the Fiscal Quarter just ended; plus
(iv) an amount equal to the sum of all unrestricted balances on
deposit with banks or other financial institutions, plus the market value
of Investments permitted under Section 5.17(i), (ii), (iii) and (iv); plus
(v) an amount equal to the quotient of (x) the sum of the
Economic Percentage of all earnings before interest and taxes of all
Service Companies for the 3 month period ending on the last day of the
month just ended prior to the date of determination, divided by (y) 0.15
(which is the capitalization rate) times (z) 4 (which is the annualization
rate).
<PAGE>
"Guarantee" by any Person means any obligation, contingent or
otherwise, of such Person directly or indirectly guaranteeing any Debt or
other obligation of any other Person and, without limiting the generality
of the foregoing, any obligation, direct or indirect, contingent or
otherwise, of such Person (i) to secure, purchase or pay (or advance or
supply funds for the purchase or payment of) such Debt or other obligation
(whether arising by virtue of partnership arrangements, by agreement to
keep-well, to purchase assets, goods, securities or services, to provide
collateral security, to take-or-pay, or to maintain financial statement
conditions or otherwise) or (ii) entered into for the purpose of assuring
in any other manner the obligee of such Debt or other obligation of the
payment thereof or to protect such obligee against loss in respect thereof
(in whole or in part), PROVIDED that the term Guarantee shall not include
endorsements for collection or deposit in the ordinary course of business.
The term "Guarantee" used as a verb has a corresponding meaning.
"Guarantors" means any one, or more or all, as the context
shall require, of each Subsidiary which becomes a Guarantor pursuant to
Section 5.28, subject to the provisions of the last sentence of Section
5.05.
"Guaranty" means the Guaranty Agreement in substantially the
form of EXHIBIT K to be executed by each of the Guarantors pursuant to
Section 5.28, unconditionally and jointly and severally Guaranteeing
payment of the Loans, the Notes and all other obligations of the Borrower
to the Agent and the Banks hereunder, including without limitation all
principal, interest, fees, costs, and compensation and indemnification
amounts.
"Harris Trust Facility" means the Secured Revolving Credit
Facility Agreement dated as of September 16, 1994, as amended between the
Borrower and Harris Trust & Savings Bank, providing for a line of
credit/letter of credit facility in the aggregate amount of $8,000,000.
"Hazardous Materials" includes, without limitation, (a) solid
or hazardous waste, as defined in the Resource Conservation and Recovery
Act of 1980, 42 U.S.C. Section 6901 et seq. and its implementing
regulations and amendments, or in any applicable state or local law or
regulation, (b) "hazardous substance", "pollutant", or "contaminant" as
defined in CERCLA, or in any applicable state or local law or regulation,
(c) gasoline, or any other petroleum product or by-product, including,
crude oil or any fraction thereof, (d) toxic substances, as defined in the
Toxic Substances Control Act of 1976, or in any applicable state or local
law or regulation and (e) insecticides, fungicides, or rodenticides, as
defined in the Federal Insecticide, Fungicide, and Rodenticide Act of 1975,
or in any applicable state or local law or regulation, as each such Act,
statute or regulation may be amended from time to time.
"Hedging Agreement" means any agreement to which the Borrower
or any Guarantor is a party consisting of interest rate protection
agreements, foreign currency exchange agreements or other hedging
arrangements.
"Interest Period" means: (1) with respect to each Euro-Dollar
Borrowing, the period commencing on the date of such Borrowing and ending
on the numerically corresponding day in the first, second, third or sixth
month thereafter, as the Borrower may elect in the applicable Notice of
Borrowing; PROVIDED that:
(a) any Interest Period (subject to paragraph (c) below)
which would otherwise end on a day which is not a Euro-Dollar Business Day
shall be extended to the next succeeding Euro-Dollar Business Day unless
such Euro-Dollar Business Day falls in another calendar month, in which
case such Interest Period shall end on the next preceding Euro-Dollar
Business Day;
<PAGE>
(b) any Interest Period which begins on the last Euro-Dollar
Business Day of a calendar month (or on a day for which there is no
numerically corresponding day in the appropriate subsequent calendar month)
shall, subject to paragraph (c) below, end on the last Euro-Dollar Business
Day of the appropriate subsequent calendar month; and
(c) no Interest Period may be selected which begins before the
Termination Date and would otherwise end after the Termination Date; and
(2) with respect to each Base Rate Borrowing, the period commencing on the
date of such Borrowing and ending 30 days thereafter; PROVIDED that:
(a) any Interest Period (subject to paragraph (b) below)
which would otherwise end on a day which is not a Domestic Business Day
shall be extended to the next succeeding Domestic Business Day; and
(b) no Interest Period which begins before the Termination
Date and would otherwise end after the Termination Date may be selected;
and
(3) with respect to each Transaction Rate Borrowing, any period up to 14
days mutually agreeable to the Borrower and Wachovia which ends on or prior
to the Termination Date.
(4) with respect to each Money Market Borrowing, the period commencing on
the date of such Borrowing and ending on the Stated Maturity Date or such
other date or dates as may be specified in the applicable Money Market
Quote; provided that:
(a) any Interest Period (subject to clause (b) below) which
would otherwise end on a day which is not a Domestic Business Day shall be
extended to the next succeeding Domestic Business Day; and
(b) no Interest Period may be selected which would end after
the Termination Date.
"Investment" means any investment in any Person, whether by
means of purchase or acquisition of obligations or securities of such
Person, capital contribution to such Person, loan or advance to such
Person, making of a time deposit with such Person, or assumption of any
obligation of such Person or otherwise.
"Investment Grade Debt Rating" means, a Debt Rating equal or
higher than Baa3 if such Debt Rating is issued by Moody's, BBB- if such
Debt Rating is issued by S&P, and BBB- if such Debt Rating is issued by
Duff & Phelps.
"Lending Office" means, as to each Bank, its office located at
its address set forth on the signature pages hereof (or identified on the
signature pages hereof as its Lending Office) or such other office as such
Bank may hereafter designate as its Lending Office by notice to the
Borrower and the Agent.
"Lien" means, with respect to any asset, any mortgage, deed to
secure debt, deed of trust, lien, pledge, charge, security interest,
security title, preferential arrangement which has the practical effect of
constituting a security interest, encumbrance or servitude of any kind in
respect of such asset to secure or assure payment of a Debt or a Guarantee,
whether by consensual agreement or by operation of statute or other law, or
by any agreement, contingent or otherwise, to provide any of the foregoing.
For the purposes of this Agreement, the Borrower or any Subsidiary shall be
deemed to own subject to a Lien any asset which it has acquired or holds
subject to the interest of a vendor or lessor under any conditional sale
agreement, capital lease or other title retention agreement relating to
such asset.
<PAGE>
"Loan" means a Base Rate Loan, Euro-Dollar Loan, Syndicated
Loan, Transaction Rate Loan or Money Market Loan, and "Loans" means Base
Rate Loans, Euro-Dollar Loans, Syndicated Loans, Money Market Loans,
Transaction Rate Loans, or any or all of them, as the context shall
require.
"Loan Documents" means this Agreement, the Notes, the Guaranty,
the Contribution Agreement, any other document evidencing, relating to or
securing the Loans, and any other document or instrument delivered to the
Agent or the Banks from time to time in connection with this Agreement, the
Notes or the Loans, as such documents and instruments may be amended or
supplemented from time to time.
"London Interbank Offered Rate" has the meaning set forth in
Section 2.06(c).
"Margin Stock" means "margin stock" as defined in Regulations
T, U or X.
"Material Adverse Effect" means, with respect to any event,
act, condition or occurrence of whatever nature (including any adverse
determination in any litigation, arbitration, or governmental investigation
or proceeding), whether singly or in conjunction with any other event or
events, act or acts, condition or conditions, occurrence or occurrences,
whether or not related, a material adverse change in, or a material adverse
effect upon, any of (a) the financial condition, operations, business,
properties or prospects of the General Partner, or of the Borrower and the
Consolidated Entities taken as a whole, (b) the rights and remedies of the
Agent or the Banks under the Loan Documents, or the ability of the Borrower
or the Consolidated Entities to perform its obligations under the Loan
Documents to which it is a party, as applicable, or (c) the legality,
validity or enforceability of any Loan Document.
"Money Market Borrowing Date" has the meaning specified in
Section 2.03.
"Money Market Facility Limit" means an amount equal to fifty
percent (50%) of the aggregate Commitments, as such Commitments may be
increased or reduced from time to time.
"Money Market Loan" means a Loan made by a Bank pursuant to
Section 2.03 which bears interest at the Money Market Rate.
"Money Market Loan Notes" means the promissory notes of the
Borrower, substantially in the form of EXHIBIT A-3, evidencing the
obligation of the Borrower to repay the Money Market Loans, together with
all amendments, consolidations, modifications, renewals and supplements
thereto.
"Money Market Quote" has the meaning specified in Section
2.03(c)(i).
"Money Market Quote Request" has the meaning specified in
Section 2.03(b).
"Money Market Rate" has the meaning specified in Section
2.03(c)(ii)(C).
"Moody's" means Moody's Investor Service, Inc.
"Mortgage" means, with respect to any referenced Property, a
mortgage, deed to secure debt, deed of trust or similar instrument
encumbering such Property.
<PAGE>
"Multiemployer Plan" shall have the meaning set forth in
Section 4001(a)(3) of ERISA.
"NAREIT" means the National Association of Real Estate
Investment Trusts.
"Net Income" means, as applied to any Person for any period,
the aggregate amount of net income of such Person for such period, as
determined in accordance with GAAP.
"Net Operating Income" means, (A) for any Property, calculated
on a consolidated basis for the Borrower and the Consolidated Entities, the
sum of the following derived from such Property: (i) Property revenues,
less (ii) Property expenses (excluding depreciation, amortization and debt
service), less (iii) an assumed management fee equal to 4% of gross rental
income (less any management fees included in Property expenses under clause
(ii)) and less (iv) an annual capital reserve equal to $150 for each Unit.
"New Bank" has the meaning set forth in Section 2.14.
"Non-Recourse Mortgage Debt" means Debt secured by a Mortgage
on Property, which the Agent has determined in good faith contains
satisfactory exculpation provisions, except for customary exclusions for
environmental liability, misapplication or fraudulent application of rent
after default, insurance proceeds and condemnation awards and other
customary exclusions.
"Notes" means the Syndicated Loan Notes, the Swing Loan Note,
or Money Market Loan Notes, or any one, or more, or all of them, as the
context shall require.
"Notice of Borrowing" has the meaning set forth in Section
2.02.
"Officer's Certificate and Agreement" has the meaning set forth
in Section 3.01(f).
"Participant" has the meaning set forth in Section 9.08(b).
"Partner" means the owner of a Partnership Interest.
"Partner Conversions" means the exchange by any limited partner
of the Borrower of any of its limited partner interests in the Borrower to
shares in the General Partner, on 1 for 1 ratio, pursuant to the provisions
of the Limited Partnership Agreement.
"Partnership Interests" means any partner interests in the
Borrower, whether general or limited.
"PBGC" means the Pension Benefit Guaranty Corporation or any
entity succeeding to any or all of its functions under ERISA.
"Performance Pricing Determination Date" has the meaning set
forth in Section 2.06(a).
"Person" means an individual, a corporation, a partnership, an
unincorporated association, a limited liability company, a limited
liability partnership, a trust or any other entity or organization,
including, but not limited to, a government or political subdivision or an
agency or instrumentality thereof.
<PAGE>
"Plan" means at any time an employee pension benefit plan which
is covered by Title IV of ERISA or subject to the minimum funding standards
under Section 412 of the Code and is either (i) maintained by a member of
the Controlled Group for employees of any member of the Controlled Group or
(ii) maintained pursuant to a collective bargaining agreement or any other
arrangement under which more than one employer makes contributions and to
which a member of the Controlled Group is then making or accruing an
obligation to make contributions or has within the preceding 5 plan years
made contributions.
"Prime Rate" refers to that interest rate so denominated and
set by Wachovia from time to time as an interest rate basis for borrowings.
The Prime Rate is but one of several interest rate bases used by Wachovia.
Wachovia lends at interest rates above and below the Prime Rate.
"Properties" means all real property owned, leased or otherwise
used or occupied by the General Partner, the Borrower or any Guarantor,
wherever located.
"Qualified Letter of Credit" means a Letter of Credit (i)
issued by a bank or financial institution with a Debt Rating of "A" or
higher (or the equivalent), (ii) issued for the benefit of Borrower, and
(iii) that is irrevocable, unconditional (other than the presentment of
required documents), and drawn on site.
"Quarterly Period" means a 3 month period (or portion thereof)
ending on each March 31, June 30, September 30 and December 31 after June
27, 1997, and prior to the Termination Date.
"Redeemable Preferred Stock" of any Person means any preferred
stock issued by such Person which is at any time prior to the Termination
Date either (i) mandatorily redeemable (by sinking fund or similar payments
or otherwise) or (ii) redeemable at the option of the holder thereof.
"Refunding Loan" means a new Syndicated Loan made on the day on
which an outstanding Syndicated Loan is maturing or a Base Rate Borrowing
is being converted to a Euro-Dollar Borrowing, if and to the extent that
the proceeds thereof are used entirely for the purpose of paying such
maturing Loan or Loan being converted, excluding any difference between the
amount of such maturing Syndicated Loan or Syndicated Loan being converted
and any greater amount being borrowed on such day and actually either being
made available to the Borrower pursuant to Section 2.02(c) or remitted to
the Agent as provided in Section 2.12, in each case as contemplated in
Section 2.02(d).
"Regulation T" means Regulation T of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Regulation U" means Regulation U of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Regulation X" means Regulation X of the Board of Governors of
the Federal Reserve System, as in effect from time to time, together with
all official rulings and interpretations issued thereunder.
"Required Banks" means at any time Banks having at least 66
2/3% of the aggregate amount of the Commitments or, if the Commitments are
no longer in effect, Banks holding at least 66 2/3% of the aggregate
outstanding principal amount of the sum of the (i) Syndicated Loans and
(ii) Money Market Loans.
<PAGE>
"Restricted Payment" means (i) any dividend or other
distribution on any shares of the Borrower's Capital Stock (except
dividends payable solely in shares of its Capital Stock) or (ii) any
payment on account of the purchase, redemption, retirement or acquisition
of (a) any shares of the Borrower's Capital Stock (except shares acquired
upon the conversion thereof into other shares of its Capital Stock) or (b)
any option, warrant or other right to acquire shares of the Borrower's
Capital Stock.
"S&P" means Standard & Poor's Ratings Group, a division of
McGraw-Hill, Inc.
"Service Companies" means Amli Institutional Advisors, Inc., a
Delaware corporation, Amli Management Company, a Delaware corporation, and
Amli Residential Construction, Inc., a Delaware corporation.
"Sope Creek Properties" means Phases I, II and III of the
apartment community known as "AMLI at Sope Creek" and located in Marietta,
Cobb County, Georgia.
"Stabilized Property" means at any time any apartment community
Property owned by the Borrower (i) which is at least 90% leased and
economically occupied (pursuant to written leases which have been signed by
both landlord and tenant, but including any month to month occupancy by any
such tenant after the expiration of such written lease) or (ii) with
respect to which a permanent certificate of occupancy was issued at least 3
months prior to the date of measurement.
"Stated Maturity Date" means, with respect to any Money Market
Loan, the Stated Maturity Date therefor specified by the Bank in the
applicable Money Market Quote.
"Subsidiary" means any corporation or other entity of which
securities or other ownership interests having ordinary voting power to
elect a majority of the board of directors or other persons performing
similar functions are at the time directly or indirectly owned by the
Borrower or the General Partner; EXCLUDING, however, the Co-Investment
Partnerships. The Service Companies are not Subsidiaries.
"Swing Loan" means a Loan made by Wachovia pursuant to Section
2.01(b), which must be a Base Rate Loan or a Transaction Rate Loan.
"Swing Loan Note" means the promissory note of the Borrower,
substantially in the form of EXHIBIT A-2, evidencing the obligation of the
Borrower to repay the Swing Loans, together with all amendments,
consolidations, modifications, renewals, and supplements thereto.
"Syndicated Loans" means Base Rate Loans or Euro-Dollar Loans
made pursuant to the terms and conditions set forth in Section 2.01.
"Syndicated Loan Notes" means the promissory notes of the
Borrower, substantially in the form of EXHIBIT A-1, evidencing the
obligation of the Borrower to repay Syndicated Loans, together with all
amendments, consolidations, modifications, renewals and supplements
thereto.
"Taxes" has the meaning set forth in Section 2.12(c).
"Termination Date" means whichever is applicable of (i) June
26, 2001, (ii) such later date to which it is extended by the Banks
pursuant to Section 2.05(b), in their sole and absolute discretion, (iii)
the date the Commitments are terminated pursuant to Section 6.01 following
the occurrence of an Event of Default, or (iv) the date the Borrower
terminates the Commitments entirely pursuant to Section 2.07.
<PAGE>
"Third Parties" means all lessees, sublessees, licensees and
other users of the Properties, excluding those users of the Properties in
the ordinary course of the Borrower's business and on a temporary basis.
"Total Consolidated Liabilities" means at any time, for the
Borrower and the Consolidated Entities, determined on a consolidated basis,
but without duplication, the sum of (i) Consolidated Liabilities, plus (ii)
all Debt Guaranteed by the Borrower or any Consolidated Entity, plus (iii)
the face amount of all letters of credit issued for the account of the
Borrower or any Consolidated Entity, minus (iv) Approved Collateral Value.
"Total Secured Debt" means at any time, for the Borrower and
the Consolidated Entities, determined on a consolidated basis, but without
duplication, the sum of the following, but only if any Property, or
ownership interest of the owner thereof, is subject to a Mortgage with
respect thereto: (i) all indebtedness for borrowed money; (ii) the deferred
purchase price of Property; (iii) all capital leases; (iv) all obligations
to reimburse any bank or other Person in respect of amounts paid or to be
paid under a letter of credit or similar instrument; and (v) all Guarantees
of Debt of Persons other than the Borrower and the Consolidated Entities.
"Trammell Crow Residential Midwest Acquisitions" means,
collectively:
(i) the acquisition of the following apartment
communities: (a) Vinings at River Glen, Indianapolis, Indiana; (b) Vinings
Ridge, Kansas City, Kansas; (c) Vinings at Centennial Park, Kansas City,
Kansas; (d) Vinings Square, Kansas City, Kansas; (e) Vinings at Eagle
Creek, Indianapolis, Indiana; and (f) Vinings Trace, Kansas City, Kansas;
and
(ii) those transactions resulting in the creation of two
Co-Investment Partnerships by which the Borrower will acquire (a) a 50%
limited partnership interest in a partnership to be formed to acquire the
Pinnacle Square apartment community, Indianapolis, Indiana and (b) a 1%
general partnership interest in a partnership to be formed to acquire the
Landmark on Spring apartment community, Indianapolis, Indiana.
"Transaction Rate" has the meaning set forth in Section
2.01(b)(ii).
"Transaction Rate Loan" means a Swing Loan to be made as a
Transaction Rate Loan pursuant to Section 2.01(b).
"Transaction Rate Request" has the meaning set forth in Section
2.01(b)(ii).
"Transferee" has the meaning set forth in Section 9.08(d).
"Undepreciated Book Asset Value" means at any time, for the
Borrower and its Subsidiaries, the sum of (x) the original cost of all real
estate assets plus the cost of capital improvements thereon, without
deduction for accumulated depreciation and amortization incurred in
connection therewith, plus (y) the book value of all other tangible assets
determined in accordance with GAAP, minus (z) Approved Collateral Value.
<PAGE>
"Unencumbered Assets" means at any time, for the Borrower and
the Guarantors, determined on a consolidated basis, the sum of the
following: (i) an amount equal to (x) the Net Operating Income for the 3
month period ending on the last day of the Fiscal Quarter just ended prior
to the date of determination, from each Property not subject to a Mortgage,
divided by (y) 0.09 (which is the capitalization factor), times (z) 4
(which is the annualization factor); plus (ii) the book value of
Construction in Progress on all Property not subject to a Mortgage plus
Properties consisting of unimproved land not subject to a Mortgage.
"Unencumbered Stabilized Properties" means at any time, all
Stabilized Properties not subject to a Mortgage.
"Unfunded Vested Liabilities" means, with respect to any Plan
at any time, the amount (if any) by which (i) the present value of all
vested nonforfeitable benefits under such Plan exceeds (ii) the fair market
value of all Plan assets allocable to such benefits, all determined as of
the then most recent valuation date for such Plan, but only to the extent
that such excess represents a potential liability of a member of the
Controlled Group to the PBGC or the Plan under Title IV of ERISA.
"Unit" means an individual apartment unit located in a
Property.
"Unsecured Net Operating Income" means at any time all Net
Operating Income (but without giving effect to clauses (iii) and (iv) of
the definition thereof) attributable to Unencumbered Stabilized Properties.
"Unsecured Funded Debt" means at any time, for the Borrower and
the Consolidated Entities, determined on a consolidated basis, the sum of
the following, but only if any Property, or ownership interest of the owner
thereof, is not subject to a Mortgage with respect thereto: (i) all
indebtedness for borrowed money; (ii) the deferred purchase price of
Property; (iii) all capital leases; (iv) all obligations to reimburse any
bank or other Person in respect of amounts paid or to be paid under a
letter of credit or similar instrument; and (v) all Guarantees of Debt of
Persons other than the Borrower and the Consolidated Entities, and (vi)
Debt not exceeding $7,500,000 in the aggregate principal amount with
respect to the Sope Creek Properties.
"Unsecured Interest Expense" means at any time that portion of
Consolidated Interest Expense attributable to Unsecured Funded Debt.
"Unused Commitment" means at any date, with respect to any
Bank, an amount equal to its Commitment less the aggregate outstanding
principal amount of its Syndicated Loans (but not its Money Market Loans,
or, with respect to Wachovia, its Swing Loans).
"Wachovia" means Wachovia Bank, N.A., a national banking
association, and its successors.
"Wholly Owned Subsidiary" means any Subsidiary all of the
shares of capital stock or other ownership interests of which (except
directors' qualifying shares) are at the time directly or indirectly owned
by the Borrower or the General Partner.
"Year 2000 Compliant" has the meaning set forth in Section
4.20.
<PAGE>
SECTION 1.02. ACCOUNTING TERMS AND DETERMINATIONS. Unless
otherwise specified herein, all terms of an accounting character used
herein shall be interpreted, all accounting determinations hereunder shall
be made, and all financial statements required to be delivered hereunder
shall be prepared, in accordance with GAAP, or with respect to the
calculation of Funds From Operations, as required by NAREIT, applied on a
basis consistent (except for changes concurred in by the General Partner's
independent public accountants or otherwise required by a change in GAAP)
with the most recent audited consolidated financial statements of the
General Partner or the Borrower and its Consolidated Subsidiaries delivered
to the Banks unless with respect to any such change concurred in by the
General Partner's independent public accountants or required by GAAP or,
with respect to the calculation of Funds From Operations, as required by
NAREIT, in determining compliance with any of the provisions of this
Agreement or any of the other Loan Documents: (i) the Borrower shall have
objected to determining such compliance on such basis at the time of
delivery of such financial statements, or (ii) the Required Banks shall so
object in writing within 30 days after the delivery of such financial
statements, in either of which events such calculations shall be made on a
basis consistent with those used in the preparation of the latest financial
statements as to which such objection shall not have been made (which, if
objection is made in respect of the first financial statements delivered
under Section 5.01 hereof, shall mean the financial statements referred to
in Section 4.04).
SECTION 1.03. REFERENCES. Unless otherwise indicated,
references in this Agreement to "Articles", "Exhibits", "Schedules",
"Sections" and other Subdivisions are references to articles, exhibits,
schedules, sections and other subdivisions hereof.
SECTION 1.04. USE OF DEFINED TERMS. All terms defined in
this Agreement shall have the same defined meanings when used in any of the
other Loan Documents, unless otherwise defined therein or unless the
context shall require otherwise.
SECTION 1.05. TERMINOLOGY. All personal pronouns used in
this Agreement, whether used in the masculine, feminine or neuter gender,
shall include all other genders; the singular shall include the plural, and
the plural shall include the singular. Titles of Articles and Sections in
this Agreement are for convenience only, and neither limit nor amplify the
provisions of this Agreement.
ARTICLE II
THE CREDITS
SECTION 2.01. COMMITMENTS TO LEND SYNDICATED LOANS.
(a) SYNDICATED LOANS. Each Bank severally agrees, on the terms and
conditions set forth herein, to make Syndicated Loans to the Borrower from
time to time before the Termination Date; PROVIDED that,
(i) immediately after each such Syndicated Loan is made, the
aggregate outstanding principal amount of Syndicated Loans by such Bank
shall not exceed the amount of its Commitment, and
(ii) the aggregate outstanding amount of all Syndicated Loans,
Money Market Loans and Swing Loans shall not exceed the lesser of (A) the
aggregate amount of the Commitments and (B) the Borrowing Base.
<PAGE>
Each Syndicated Borrowing under this Section shall be in an aggregate
principal amount of (x) for Base Rate Loans, $1,000,000 or any larger
integral multiple of $500,000, and (y) for Euro-Dollar Loans, $1,000,000 or
any larger integral multiple of $500,000 (except that in each case any such
Borrowing may be in the aggregate amount of the Unused Commitments) and
shall be made from the several Banks ratably in proportion to their
respective Commitments. Within the foregoing limits, the Borrower may
borrow under this Section, repay or, to the extent permitted by Section
2.09, prepay Syndicated Loans and reborrow under this Section at any time
before the Termination Date.
(b) SWING LOANS. (i) In addition to the foregoing, Wachovia shall
from time to time, upon the request of the Borrower, if the applicable
conditions precedent in Article III have been satisfied, make Swing Loans
to the Borrower in an aggregate principal amount at any time outstanding
not exceeding $5,000,000; PROVIDED that, immediately after such Swing Loan
is made, the outstanding amount of the Syndicated Loans, Money Market
Loans, and Swing Loans shall not exceed the lesser of (A) the aggregate
amount of the Commitments and (B) the Borrowing Base. Within the foregoing
limits, the Borrower may borrow under this Section 2.01(b), prepay and
reborrow under this Section 2.01(b) at any time before the Termination
Date. All Swing Loans shall be made as either Base Rate Loans or, subject
to the provisions of clause (ii) below, Transaction Rate Loans.
(ii) Swing Loans may be Transaction Rate Loans, if the Agent shall
have determined that such Transaction Rate Loan, including the principal
amount thereof, the Interest Period and the Transaction Rate applicable
thereto, has been expressly agreed to by the Borrower and Wachovia (such
agreement may be obtained by telephone, confirmed promptly to the Agent in
writing) pursuant to the following procedures. If the Borrower desires a
Transaction Rate Loan, (a) the Borrower shall provide Wachovia, with a copy
to the Agent, with notice of a request (a "Transaction Rate Request") for a
quote for a Transaction Rate Borrowing prior to 1:00 p.m. (Atlanta, Georgia
time) on the date (which shall be a Domestic Business Day) of the proposed
Transaction Rate Borrowing, which Transaction Rate Request shall include
the principal amount and proposed Interest Period of the relevant
Transaction Rate Borrowing, (b) prior to 1:30 p.m. (Atlanta, Georgia time)
on such date, Wachovia shall furnish the Borrower, with a copy to the
Agent, with its rate quote (a "Transaction Rate Quote") via facsimile
transmission, (c) the Borrower shall immediately inform Wachovia and the
Agent of its decision as to whether to request a Transaction Rate Borrowing
at the Transaction Rate specified in such Transaction Rate Quote (a
"Transaction Rate") (which may be done by telephone and promptly confirmed
in writing, and which decision shall be irrevocable), and (d) if the
Borrower has so informed Wachovia and the Agent that it does desire a
Transaction Rate Borrowing at the Transaction Rate specified in such
Transaction Rate Quote, then by 2:00 p.m. (Atlanta, Georgia time) on the
date of such decision, Wachovia shall make such Transaction Rate Borrowing,
with interest accruing thereon at such Transaction Rate, available to the
Agent in accordance with the procedures set forth herein. The Agent shall
notify the Banks of any Transaction Rate Borrowing pursuant hereto.
(iii) At any time on or after the occurrence of an Event of Default,
upon the request of Wachovia, each Bank other than Wachovia shall, on the
third Domestic Business Day after such request is made, purchase a
participating interest in Swing Loans in an amount equal to its ratable
share (based upon its respective Commitment) of such Swing Loans, and
Wachovia shall furnish each Bank with a certificate evidencing such
participating interest. On such third Domestic Business Day, each Bank
will immediately transfer to Wachovia, in immediately available funds, the
amount of its participation. Whenever, at any time after Wachovia has
received from any such Bank its participating interest in a Swing Loan, the
Agent receives any payment on account thereof, the Agent will distribute to
such Bank its participating interest in such amount (appropriately
adjusted, in the case of interest payments, to reflect the period of time
during which such Bank's participating interest was outstanding and
funded); PROVIDED, HOWEVER, that in the event that such payment received by
<PAGE>
the Agent is required to be returned, such Bank will return to the Agent
any portion thereof previously distributed by the Agent to it. Each Bank's
obligation to purchase such participating interests shall be absolute and
unconditional and shall not be affected by any circumstance, including,
without limitation: (1) any set-off, counterclaim, recoupment, defense or
other right which such Bank or any other Person may have against Wachovia
requesting such purchase or any other Person for any reason whatsoever; (2)
the occurrence or continuance of a Default or an Event of Default or the
termination of the Commitments; (3) any adverse change in the condition
(financial or otherwise) of the Borrower or Guarantor; (4) any breach of
this Agreement by the Borrower or any other Bank; or (5) any other
circumstance, happening or event whatsoever, whether or not similar to any
of the foregoing.
SECTION 2.02. METHOD OF BORROWING SYNDICATED LOANS. For
all Loans other than Transaction Rate Loans or Money Market Loans (which
shall be governed by the provisions of Sections 2.01(b)(ii) and 2.03,
respectively):
(a) The Borrower shall give the Agent notice (a "Notice of
Borrowing"), which shall be substantially in the form of EXHIBIT E, prior
to 11:00 A.M. (Atlanta, Georgia time) on the same Domestic Business Day as
each Base Rate Borrowing and at least 3 Euro-Dollar Business Days before
each Euro-Dollar Borrowing, specifying:
(i) the date of such Syndicated Borrowing, which shall be a
Domestic Business Day in the case of a Base Rate Borrowing or a Euro-Dollar
Business Day in the case of a Euro-Dollar Borrowing,
(ii) the aggregate amount of such Syndicated Borrowing,
(iii) whether the Syndicated Loans comprising such Borrowing
are to be Syndicated Loans or Swing Loans, and whether they are to be Base
Rate Loans or Euro-Dollar Loans;
(iv) in the case of a Euro-Dollar Borrowing, the duration of
the Interest Period applicable thereto, subject to the provisions of the
definition of Interest Period.
(b) Upon receipt of a Notice of Borrowing, the Agent shall
promptly and in any event on the same business day notify each Bank of the
contents thereof and of such Bank's ratable share of such Syndicated
Borrowing and such Notice of Borrowing, once received by the Agent, shall
not thereafter be revocable by the Borrower.
(c) Not later than 11:00 A.M. (Atlanta, Georgia time) for
Euro-Dollar Loans, and 2:00 P.M. (Atlanta, Georgia time) for Base Rate
Loans, on the date of each Syndicated Borrowing, each Bank (or Wachovia,
with respect to Swing Loans) shall (except as provided in paragraph (d) of
this Section) make available its ratable share of such Syndicated
Borrowing, in Federal or other funds immediately available in Atlanta,
Georgia, to the Agent at its address determined pursuant to Section 9.01.
Unless the Agent determines that any applicable condition specified in
Article III has not been satisfied, the Agent will make the funds so
received from the Banks available to the Borrower at the Agent's aforesaid
address. Unless the Agent receives notice from a Bank, at the Agent's
address referred to in or specified pursuant to Section 9.01, no later than
4:00 P.M. (local time at such address) on the Domestic Business Day before
the date of a Syndicated Borrowing stating that such Bank will not make a
Syndicated Loan in connection with such Syndicated Borrowing, the Agent
shall be entitled to assume that such Bank will make a Syndicated Loan in
connection with such Syndicated Borrowing and, in reliance on such
assumption, the Agent may (but shall not be obligated to) make available
such Bank's ratable share of such Syndicated Borrowing to the Borrower for
the account of such Bank. If the Agent makes such Bank's ratable share
available to the Borrower and such Bank does not in fact make its ratable
share of such Syndicated Borrowing available on such date, the Agent shall
<PAGE>
be entitled to recover such Bank's ratable share from such Bank or the
Borrower (and for such purpose shall be entitled to charge such amount to
any account of the Borrower maintained with the Agent), together with
interest thereon for each day during the period from the date of such
Syndicated Borrowing until such sum shall be paid in full at a rate per
annum equal to the rate at which the Agent determines that it obtained (or
could have obtained) overnight Federal funds to cover such amount for each
such day during such period, PROVIDED that (i) any such payment by the
Borrower of such Bank's ratable share and interest thereon shall be without
prejudice to any rights that the Borrower may have against such Bank and
(ii) until such Bank has paid its ratable share of such Syndicated
Borrowing, together with interest pursuant to the foregoing, it will have
no interest in or rights with respect to such Syndicated Borrowing for any
purpose hereunder. If the Agent does not exercise its option to advance
funds for the account of such Bank, it shall forthwith notify the Borrower
of such decision.
(d) If any Bank makes a new Syndicated Loan hereunder on a
day on which the Borrower is to repay all or any part of an outstanding
Syndicated Loan from such Bank, such Bank shall apply the proceeds of its
new Syndicated Loan to make such repayment as a Refunding Loan and only an
amount equal to the difference (if any) between the amount being borrowed
and the amount of such Refunding Loan shall be made available by such Bank
to the Agent as provided in paragraph (c) of this Section, or remitted by
the Borrower to the Agent as provided in Section 2.12, as the case may be.
(e) Notwithstanding anything to the contrary contained in
this Agreement, no Fixed Rate Borrowing may be made if there shall have
occurred a Default or an Event of Default, which Default or Event of
Default shall not have been cured or waived, and all Refunding Loans shall
be made as Base Rate Loans (but shall bear interest at the Default Rate, if
applicable).
(f) In the event that a Notice of Borrowing fails to specify
whether the Syndicated Loans comprising such Syndicated Borrowing are to be
Base Rate Loans or Euro-Dollar Loans, such Syndicated Loans shall be made
as Base Rate Loans. If the Borrower is otherwise entitled under this
Agreement to repay any Syndicated Loans maturing at the end of an Interest
Period applicable thereto with the proceeds of a new Borrowing, and the
Borrower fails to repay such Syndicated Loans using its own moneys and
fails to give a Notice of Borrowing in connection with such new Syndicated
Borrowing, a new Syndicated Borrowing shall be deemed to be made on the
date such Syndicated Loans mature in an amount equal to the principal
amount of the Syndicated Loans so maturing, and the Syndicated Loans
comprising such new Syndicated Borrowing shall be Base Rate Loans.
(g) Notwithstanding anything to the contrary contained
herein, there shall not be a total of more than 8 Euro-Dollar Borrowings
and Money Market Loans outstanding at any given time.
SECTION 2.03. MONEY MARKET LOANS. (a) In addition to
making Syndicated Borrowings, the Borrower may, as set forth in this
Section 2.03, request the Banks to make offers to make Money Market
Borrowings available to the Borrower. The Banks may, but shall have no
obligation to, make such offers and the Borrower may, but shall have no
obligation to, accept any such offers in the manner set forth in this
Section 2.03, PROVIDED that:
(i) the number of Money Market Loans which may be
outstanding at any given time is subject to the provisions of Section
2.02(g);
<PAGE>
(ii) the aggregate principal amount of all Money Market
Loans, (A) do not exceed the Money Market Facility Limit, and (B) together
with the aggregate principal amount of all Syndicated Loans and all Swing
Loans, at any one time outstanding shall not exceed the aggregate amount of
the Commitments of all of the Banks at such time;
(iii) the Money Market Loans of any Bank will be deemed to be
usage of the Commitments for the purpose of calculating availability
pursuant to Sections 2.01(a)(ii), 2.01(b)(i) and 2.03(a)(ii) and fees
pursuant to Section 2.07, but will not reduce such Bank's obligation to
lend its pro rata share of the remaining Unused Commitment; and
(iv) Borrower's Debt Rating is Investment Grade or higher.
(b) When the Borrower wishes to request offers to make Money
Market Loans, it shall give the Agent (which shall promptly notify the
Banks) notice substantially in the form of EXHIBIT M hereto (a "Money
Market Quote Request") so as to be received no later than 11:00 A.M.
(Atlanta, Georgia time) at least 3 Domestic Business Days prior to the date
of the Money Market Borrowing proposed therein (or such other time and date
as the Borrower and the Agent, with the consent of the Required Banks, may
agree), specifying:
(i) the proposed date of such Money Market Borrowing,
which shall be a Euro-Dollar Business Day (the "Money Market Borrowing
Date");
(ii) the maturity date (or dates) (each a "Stated Maturity
Date") for repayment of each Money Market Loan to be made as part of such
Money Market Borrowing (which Stated Maturity Date shall be that date
occurring not less than 7 days but not more than 180 days from the date of
such Money Market Borrowing); PROVIDED that the Stated Maturity Date for
any Money Market Loan may not extend beyond the Termination Date (as in
effect on the date of such Money Market Quote Request); and
(iii) the aggregate amount of principal to be requested by
the Borrower as a result of such Money Market Borrowing, which shall be at
least $5,000,000 (and in larger integral multiples of $1,000,000) but shall
not cause the limits specified in Section 2.03(a) to be violated.
The Borrower may request offers to make Money Market Loans having up to 2
different Stated Maturity Dates in a single Money Market Quote Request;
PROVIDED that the request for each separate Stated Maturity Date shall be
deemed to be a separate Money Market Quote Request for a separate Money
Market Borrowing. Except as otherwise provided in the immediately
preceding sentence, after the first Money Market Quote Request has been
given hereunder, no Money Market Quote Request shall be given until at
least 5 Domestic Business Days after all prior Money Market Quote Requests
have been fully processed by the Agent, the Banks and the Borrower pursuant
to this Section 2.03.
<PAGE>
(c) (i) Each Bank may, but shall have no obligation to,
submit a response containing an offer to make a Money Market Loan
substantially in the form of EXHIBIT N hereto (a "Money Market Quote") in
response to any Money Market Quote Request; PROVIDED that, if the
Borrower's request under Section 2.03(b) specified more than 1 Stated
Maturity Date, such Bank may, but shall have no obligation to, make a
single submission containing a separate offer for each such Stated Maturity
Date and each such separate offer shall be deemed to be a separate Money
Market Quote. Each Money Market Quote must be submitted to the Agent not
later than 10:00 A.M. (Atlanta, Georgia time) on the Money Market Borrowing
Date; PROVIDED that any Money Market Quote submitted by Wachovia may be
submitted, and may only be submitted, if Wachovia notifies the Borrower of
the terms of the offer contained therein not later than 9:45 A.M. (Atlanta,
Georgia time) on the Money Market Borrowing Date (or 15 minutes prior to
the time that the other Banks are required to have submitted their
respective Money Market Quotes). Subject to Section 6.01, any Money Market
Quote so made shall be irrevocable except with the written consent of the
Agent given on the instructions of the Borrower.
(ii) Each Money Market Quote shall specify:
(A) the proposed Money Market Borrowing Date and
the Stated Maturity Date therefor;
(B) the principal amounts of the Money Market
Loan which the quoting Bank is willing to make for the applicable Money
Market Quote, which principal amounts (x) may be greater than or less than
the Commitment of the quoting Bank, (y) shall be at least $5,000,000 or a
larger integral multiple of $500,000, and (z) may not exceed the principal
amount of the Money Market Borrowing for which offers were requested;
(C) the rate of interest per annum (rounded
upwards, if necessary, to the nearest 1/100th of 1%) offered for each such
Money Market Loan (such amounts being hereinafter referred to as the "Money
Market Rate"); and
(D) the identity of the quoting Bank.
Unless otherwise agreed by the Agent and the Borrower, no Money
Market Quote shall contain qualifying, conditional or similar language or
propose terms other than or in addition to those set forth in the
applicable Money Market Quote Request (other than setting forth the
principal amounts of the Money Market Loan which the quoting Bank is
willing to make for the applicable Interest Period) and, in particular, no
Money Market Quote may be conditioned upon acceptance by the Borrower of
all (or some specified minimum) of the principal amount of the Money Market
Loan for which such Money Market Quote is being made.
(d) The Agent shall as promptly as practicable after the
Money Market Quote is submitted (but in any event not later than 10:30 A.M.
(Atlanta, Georgia time)) on the Money Market Borrowing Date, notify the
Borrower of the terms (i) of any Money Market Quote submitted by a Bank
that is in accordance with Section 2.03(c) and (ii) of any Money Market
Quote that amends, modifies or is otherwise inconsistent with a previous
Money Market Quote submitted by such Bank with respect to the same Money
Market Quote Request. Any such subsequent Money Market Quote shall be
disregarded by the Agent unless such subsequent Money Market Quote is
submitted solely to correct a manifest error in such former Money Market
Quote. The Agent's notice to the Borrower shall specify (A) the principal
amounts of the Money Market Borrowing for which offers have been received
and (B) the respective principal amounts and Money Market Rates so offered
by each Bank (identifying the Bank that made each Money Market Quote).
<PAGE>
(e) Not later than 11:00 A.M. (Atlanta, Georgia time) on the
Money Market Borrowing Date, the Borrower shall notify the Agent of its
acceptance or nonacceptance of the offers so notified to it pursuant to
Section 2.03(d) and the Agent shall promptly notify each Bank which
submitted an offer. In the case of acceptance, such notice shall specify
the aggregate principal amount of offers (for each Stated Maturity Date)
that are accepted. The Borrower may accept any Money Market Quote in whole
or in part; PROVIDED that:
(i) the aggregate principal amount of each Money Market
Borrowing may not exceed the applicable amount set forth in the related
Money Market Quote Request;
(ii) the aggregate principal amount of each Money Market
Loan comprising a Money Market Borrowing shall be at least $5,000,000 (and
in larger integral multiples of $500,000) but shall not cause the limits
specified in Section 2.03(a) to be violated;
(iii) acceptance of offers may only be made in ascending
order of Money Market Rates; and
(iv) the Borrower may not accept any offer where the Agent
has advised the Borrower that such offer fails to comply with Section
2.03(c)(ii) or otherwise fails to comply with the requirements of this
Agreement (including without limitation, Section 2.03(a)).
If offers are made by 2 or more Banks with the same Money Market Rates for
a greater aggregate principal amount than the amount in respect of which
offers are accepted for the related Stated Maturity Date, the principal
amount of Money Market Loans in respect of which such offers are accepted
shall be allocated by the Borrower among such Banks as nearly as possible
in proportion to the aggregate principal amount of such offers.
Determinations by the Borrower of the amounts of Money Market Loans shall
be conclusive in the absence of manifest error.
(f) Any Bank whose offer to make any Money Market Loan has
been accepted shall, not later than 2:00 P.M. (Atlanta, Georgia time) on
the Money Market Borrowing Date, make the amount of such Money Market Loan
allocated to it available to the Agent at its address referred to in
Section 9.01 in immediately available funds. The amount so received by the
Agent shall, subject to the terms and conditions of this Agreement, be made
available to the Borrower on such date by depositing the same, in
immediately available funds, not later than 4:00 P.M. (Atlanta, Georgia
time), in an account of such Borrower maintained with Wachovia.
(g) After any Money Market Loan has been funded, the Agent
shall notify the Banks of the aggregate principal amount of the Money
Market Quotes received and the highest and lowest rates included in such
Money Market Quotes.
SECTION 2.04. NOTES. (a) The Syndicated Loans of each Bank
shall be evidenced by a single Syndicated Loan Note payable to the order of
such Bank for the account of its Lending Office in an amount equal to the
original principal amount of such Bank's Commitment. The Swing Loans shall
be evidenced by a single Swing Loan Note payable to the order of Wachovia
in the original principal amount of $5,000,000. The Money Market Loans
made by any Bank to the Borrower shall be evidenced by a single Money
Market Loan Note payable to the order of such Bank for the account of its
Lending Office in an amount equal to the Money Market Facility Limit.
<PAGE>
(b) Upon receipt of each Bank's Syndicated Loan Notes, Money
Market Loan Notes, and Wachovia's Swing Loan Note pursuant to Section 3.01,
the Agent shall deliver such Syndicated Loan Notes and Money Market Loan
Notes to such Bank and the Swing Loan Note to Wachovia. Each Bank, as to
the Syndicated Loans and Money Market Loan Notes (or Wachovia, as to the
Swing Loans), shall record, and prior to any transfer of its Syndicated
Loan Notes or Money Market Loan Notes (or Swing Loan Note) shall endorse on
the schedules forming a part thereof appropriate notations to evidence, the
date, amount and maturity of, and effective interest rate for, each
Syndicated Loan or Money Market Loan Notes (or Swing Loan) made by it, the
date and amount of each payment of principal made by the Borrower with
respect thereto, and such schedules of each such Bank's Syndicated Loan
Notes or Money Market Loan Notes (or Wachovia's Swing Loan Note) shall
constitute rebuttable presumptive evidence of the respective principal
amounts owing and unpaid on such Bank's Syndicated Loan Notes or Money
Market Loan Notes (or Wachovia's Swing Loan Note); PROVIDED that the
failure of any Bank (or Wachovia) to make, or error in making, any such
recordation or endorsement shall not affect the obligation of the Borrower
hereunder or under the Syndicated Loan Notes or Money Market Loan Notes (or
Swing Loan Note) or the ability of any Bank to assign its Syndicated Loan
Notes or Money Market Loan Notes or Wachovia to assign its Swing Loan Note.
Each Bank (and Wachovia, with respect to the Swing Loan) is hereby
irrevocably authorized by the Borrower so to endorse its Syndicated Loan
Notes or Money Market Loan Notes (or Swing Loan Note) and to attach to and
make a part of any Syndicated Loan Note or Money Market Loan Notes (or
Swing Loan Note) a continuation of any such schedule as and when required.
SECTION 2.05. MATURITY OF LOANS. (a) Each Loan included in
any Borrowing shall mature, and the principal amount thereof shall be due
and payable, on the last day of the Interest Period applicable to such
Borrowing.
(b) Notwithstanding the foregoing, the outstanding principal
amount of the Loans, if any, together with all accrued but unpaid interest
thereon, if any, shall be due and payable on June 26, 2001, unless the
Termination Date is otherwise extended by the Banks, in their sole and
absolute discretion. Upon the written request of the Borrower, which
request shall be delivered to the Agent at least 60 days prior to each
Extension Date (as such term is hereinafter defined), the Banks shall have
the option (without any obligation whatsoever so to do) of extending the
Termination Date for an additional one-year period on June 21, 1999 (the
"Extension Date"). In the event that a Bank chooses to extend the
Termination Date for such an additional one-year period, notice shall be
given by such Bank to the Borrower and the Agent at least 30 days prior to
the Extension Date; provided, that the Termination Date shall not be
extended with respect to any of the Banks unless the Required Banks are
willing to extend the Termination Date and (x) the remaining Banks shall
purchase ratable assignments (without any obligation so to do) from any
terminating Bank (in the form of an Assignment and Acceptance) in
accordance with their respective percentage of the remaining Aggregate
Commitments; PROVIDED, THAT, such Banks shall be provided such opportunity
(which opportunity shall allow such Banks at least 5 Domestic Business Days
in which to make a decision) prior to the Borrower finding another bank
pursuant to the immediately succeeding clause (y); and, PROVIDED, FURTHER,
THAT, should any of the remaining Banks elect not to purchase such an
assignment, then, such other remaining Banks shall be entitled to purchase
an assignment from any Terminating Bank which includes the ratable interest
that was otherwise available to such non-purchasing remaining Bank or
Banks, as the case may be, (y) the Borrower shall find another bank,
acceptable to the Agent, willing to accept an assignment from such
terminating Bank (in the form of an Assignment and Acceptance) and/or (z)
the Borrower shall reduce the aggregate Commitments in an amount equal to
the Commitment of any such terminating Bank which is not purchased pursuant
to clause (x) or (y). In the event of any extension pursuant to the
foregoing, on the Extension Date, the Borrower shall pay to the Agent, for
the ratable account of the Banks, an extension fee equal to 0.10% of the
aggregate amount of the Commitments in effect on such Extension Date.
<PAGE>
SECTION 2.06. INTEREST RATES. (a) "Applicable Margin"
means: (i) until the Borrower receives a Debt Rating, (x) for any Base Rate
Loan, 0.00%, and (y) for each Euro-Dollar Loan 1.30%; and (ii) from and
after the date Borrower receives a Debt Rating, (x) for any Base Rate Loan,
0.00% and (y) for each Euro-Dollar Loan, the percentage determined on each
Performance Pricing Determination Date by reference to the table set forth
below and the Borrower's Debt Rating on such Performance Pricing
Determination Date; PROVIDED, that if Borrower has no Debt Rating, the
Applicable Margin for Euro-Dollar Loans shall be based upon Level IV of the
table below.
Level I Level II Level III Level IV
------- -------- --------- --------
Debt Rating greater BBB BBB- less than
than or or or BBB- or
equal to Baa2 Baa3 Baa3
BBB+
or Baa1
LIBOR + .60% .75% .90% 1.30%
In determining the amounts to be paid by the Borrower pursuant to
Sections 2.06(b) and 2.07(b), the Borrower and the Banks shall refer to the
Borrower's Debt Rating from time to time. For purposes hereof,
"Performance Pricing Determination Date" shall mean each date on which the
Borrower's Debt Rating changes. Each change in interest and fees as a
result of a change in Borrower's Debt Rating shall be effective only for
Loans (including Refunding Loans) which are made on or after the relevant
Performance Pricing Determination Date. All determinations hereunder shall
be made by the Agent unless the Required Banks shall object to any such
determination. The Borrower shall promptly notify the Agent of any change
in the Borrower's Debt Rating.
(b) Each Base Rate Loan shall bear interest on the outstanding
principal amount thereof, for each day from the date such Loan is made
until it becomes due, at a rate per annum equal to the Base Rate for such
day plus the Applicable Margin. Such interest shall be payable for each
Interest Period on the last day thereof. Any overdue principal of and, to
the extent permitted by applicable law, overdue interest on any Base Rate
Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the Default Rate.
(c) Each Euro-Dollar Loan shall bear interest on the
outstanding principal amount thereof, for the Interest Period applicable
thereto, at a rate per annum equal to the sum of the Applicable Margin plus
the applicable Adjusted London Interbank Offered Rate for such Interest
Period. Such interest shall be payable for each Interest Period on the
last day thereof and, if such Interest Period is longer than 3 months, at
intervals of 3 months after the first day thereof. Any overdue principal
of and, to the extent permitted by law, overdue interest on any Euro-Dollar
Loan shall bear interest, payable on demand, for each day until paid at a
rate per annum equal to the Default Rate.
The "Adjusted London Interbank Offered Rate" applicable to any
Interest Period means a rate per annum equal to the quotient obtained
(rounded upwards, if necessary, to the next higher 1/100th of 1%) by
dividing (i) the applicable London Interbank Offered Rate for such Interest
Period by (ii) 1.00 minus the Euro-Dollar Reserve Percentage.
<PAGE>
The "London Interbank Offered Rate" applicable to any
Euro-Dollar Loan means for the Interest Period of such Euro-Dollar Loan,
the rate per annum determined on the basis of the offered rate for deposits
in Dollars of amounts equal or comparable to the principal amount of such
Euro-Dollar Loan offered for a term comparable to such Interest Period,
which rates appear on the Dow Jones Markets, Inc. Page 3750 effective as of
11:00 A.M., London time, 2 Euro-Dollar Business Days prior to the first day
of such Interest Period, PROVIDED that if no such offered rates appear on
such page, the "London Interbank Offered Rate" for such Interest Period
will be the arithmetic average (rounded upward, if necessary, to the next
higher 1/100th of 1%) of rates quoted by not less than 2 major banks in New
York City, selected by the Agent, at approximately 10:00 A.M., New York
City time, 2 Euro-Dollar Business Days prior to the first day of such
Interest Period, for deposits in Dollars offered by leading European banks
for a period comparable to such Interest Period in an amount comparable to
the principal amount of such Euro-Dollar Loan.
"Euro-Dollar Reserve Percentage" means for any day that
percentage (expressed as a decimal) which is in effect on such day, as
prescribed by the Board of Governors of the Federal Reserve System (or any
successor) for determining the maximum reserve requirement for a member
bank of the Federal Reserve System in respect of "Eurocurrency liabilities"
(or in respect of any other category of liabilities which includes deposits
by reference to which the interest rate on Euro-Dollar Loans is determined
or any category of extensions of credit or other assets which includes
loans by a non-United States office of any Bank to United States
residents). The Adjusted London Interbank Offered Rate shall be adjusted
automatically on and as of the effective date of any change in the
Euro-Dollar Reserve Percentage.
(d) Each Money Market Loan shall bear interest on the
outstanding principal amount thereof, for each day from the date such Money
Market Loan is made until it becomes due, at a rate per annum equal to the
applicable Money Market Rate set forth in the relevant Money Market Quote.
Such interest shall be payable on the Stated Maturity Date thereof, and, if
the Stated Maturity Date occurs more than 90 days after the date of the
relevant Money Market Loan, at intervals of 90 days after the first day
thereof. Any overdue principal of and, to the extent permitted by law,
overdue interest on any Money Market Loan shall bear interest, payable on
demand, for each day until paid at a rate per annum equal to the Default
Rate.
(e) The Agent shall determine each interest rate applicable to
the Loans hereunder. The Agent shall give prompt notice to the Borrower
and the Banks by telecopier of each rate of interest so determined, and its
determination thereof shall be conclusive in the absence of manifest error.
(f) After the occurrence and during the continuance of an
Event of Default, the principal amount of the Loans (and, to the extent
permitted by applicable law, all accrued interest thereon) may, at the
election of the Required Banks, bear interest at the Default Rate.
SECTION 2.07. FEES. (a) On the Closing Date, the Borrower
shall pay to the Agent, for the account of each Bank, a fully earned and
nonrefundable upfront fee equal to 0.20% of the amount such Bank's
Commitment hereunder exceeds its previous "Commitment" under the Existing
Credit Agreement.
(b) Commencing on the Closing Date, the Borrower shall pay to
the Agent, for the ratable account of each Bank (i) for any period Borrower
lacks an Investment Grade Debt Rating, a commitment fee on the sum of the
average daily amount of such Bank's Unused Commitment at a rate per annum
equal to 0.15%, and (ii) for any period Borrower has an Investment Grade
Debt Rating, a facility fee, calculated on the aggregate amount of such
Bank's Commitment (without taking into account the amount of the
outstanding Loans made by such Bank), at the rate of 0.20% per annum. Such
fees shall be payable in arrears on each March 31, June 30, September 30
and December 31 and on the Termination Date.
<PAGE>
(c) The Borrower shall pay to the Agent, for the account and
sole benefit of the Agent, such fees and other amounts at such times as set
forth in the Agent's Letter Agreement.
SECTION 2.08. OPTIONAL TERMINATION OR REDUCTION OF
COMMITMENTS. The Borrower may, upon at least 3 Domestic Business Days'
notice (or same Domestic Business Days' notice as to Swing Loans) to the
Agent, terminate at any time, or proportionately reduce the Unused
Commitments from time to time by an aggregate amount of at least
$10,000,000 or any larger integral multiple of $500,000. If the
Commitments are terminated in their entirety, all accrued fees (as provided
under Section 2.07) shall be due and payable on the effective date of such
termination.
SECTION 2.09. MANDATORY REDUCTION AND TERMINATION OF
COMMITMENTS. The Commitments shall terminate on the Termination Date, or
on any earlier date pursuant to the provisions of and under the
circumstances provided in Section 2.11(d), and in either case any Loans
then outstanding (together with accrued interest thereon and, in the case
of a termination pursuant to Section 2.11(d), any other amounts payable
pursuant to such Section 2.11(d)) shall be due and payable on such date.
SECTION 2.10. OPTIONAL PREPAYMENTS. (a) The Borrower may,
upon at least 1 Domestic Business Days' notice to the Agent, prepay any
Base Rate Borrowing in whole at any time, or from time to time in part in
amounts aggregating at least $1,000,000 or any larger integral multiple of
$500,000 for Syndicated Borrowings (with no minimum payment as to Swing
Loan Borrowings), by paying the principal amount to be prepaid together
with accrued interest thereon to the date of prepayment. Each such
optional prepayment shall be applied to prepay ratably the Base Rate Loans
of the several Banks (or of Wachovia, as to Swing Loans) included in such
Base Rate Borrowing.
(b) Subject to any payments required pursuant to the terms of
Article VIII for such Fixed Rate Loan, upon 3 Domestic Business Day's prior
written notice (or same Domestic Business Days' notice as to Swing Loans)
to the Agent, the Borrower may prepay in minimum amounts of $1,000,000 or
any larger integral multiple of $500,000 as to Euro-Dollar Borrowings (with
no minimum payment as to Swing Loan Borrowings) all or any portion of the
principal amount of any Fixed Rate Loan prior to the maturity thereof. Each
such optional prepayment shall be applied to prepay ratably the Fixed Rate
Loans of the several Banks (or of Wachovia, as to Swing Loans) included in
such Fixed Rate Borrowing.
(c) Each such payment or prepayment shall be applied to the
Swing Loans or ratably to the Loans of the Banks outstanding on the date of
payment or prepayment in the following order of priority: (i) first, to
Swing Loans which are Base Rate Loans; (ii) second, to Transaction Rate
Loans; (iii) third, to Syndicated Loans which are Base Rate Loans; (iv)
fourth, to Euro-Dollar Loans; and (v) last, to Money Market Loans.
(d) Upon receipt of a notice of prepayment pursuant to this
Section 2.10, the Agent shall promptly notify each Bank of the contents
thereof and of such Bank's ratable share of such prepayment and such
notice, once received by the Agent, shall not thereafter be revocable by
the Borrower.
SECTION 2.11. MANDATORY PREPAYMENTS. (a) On each date on
which the Commitments are reduced pursuant to Section 2.08 or Section 2.09,
the Borrower shall repay or prepay such principal amount of the outstanding
Loans, if any (together with interest accrued thereon and any amount due
under Section 8.05(a)), as may be necessary so that after such payment the
aggregate unpaid principal amount of the Loans does not exceed the
aggregate amount of the Commitments as then reduced.
<PAGE>
(b) On each date on which the aggregate principal amount of the Loans
outstanding exceeds the Borrowing Base on such date, the Borrower shall
repay or prepay such principal amount of the outstanding Loans (together
with interest thereon and any amount due under Section 8.05(a)) as may be
necessary so that after such payment the aggregate unpaid principal amount
of the Loans does not exceed the Borrowing Base on such date.
(c) Each such payment or prepayment pursuant to paragraph (a), (b) or
(d) shall be applied ratably to the Loans of the Banks outstanding on the
date of payment or prepayment in the following order of priority: (i)
first, to Swing Loans, (ii) secondly to Syndicated Loans which are Base
Rate Loans; (iii) thirdly, to Euro-Dollar Loans; and (iv) lastly, to Money
Market Loans.
(d) In the event of a Change in Control, the Borrower shall notify
the Agent and the Banks thereof within 3 Business Days of the occurrence
thereof, and shall include in such notification relevant information
pertaining thereto. Within 14 Business Days after demand by the Agent,
made in writing at the request of the Required Banks within 60 days of the
Agent's receipt of the aforesaid notice from the Borrower, the Borrower
shall prepay in full the aggregate unpaid principal amount of the Loans,
all accrued and unpaid interest thereon, any amounts due under Section
8.05(a), and all other accrued and unpaid amount hereunder, and the
Commitments thereupon shall terminate pursuant to Section 2.08.
SECTION 2.12. GENERAL PROVISIONS AS TO PAYMENTS. (a) The
Borrower shall make each payment of principal of, and interest on, the
Loans and of fees hereunder, not later than 11:00 A.M. (Atlanta, Georgia
time) on the date when due, in Federal or other funds immediately
available in Atlanta, Georgia, to the Agent at its address referred to in
Section 9.01. The Agent will promptly distribute to each Bank its ratable
share of each such payment received by the Agent for the account of the
Banks, and to Wachovia such payment received by the Agent on account of the
Swing Loans.
(b) Whenever any payment of principal of, or interest on, the
Base Rate Loans, Money Market Loans or of fees hereunder shall be due on a
day which is not a Domestic Business Day, the date for payment thereof
shall be extended to the next succeeding Domestic Business Day. Whenever
any payment of principal of or interest on, the Euro-Dollar Loans shall be
due on a day which is not a Euro-Dollar Business Day, the date for payment
thereof shall be extended to the next succeeding Euro-Dollar Business Day
unless such Euro-Dollar Business Day falls in another calendar month, in
which case the date for payment thereof shall be the next preceding
Euro-Dollar Business Day.
(c) All payments of principal, interest and fees and all
other amounts to be made by the Borrower pursuant to this Agreement with
respect to any Loan or fee relating thereto shall be paid without deduction
for, and free from, any tax, imposts, levies, duties, deductions, or
withholdings of any nature now or at anytime hereafter imposed by any
governmental authority or by any taxing authority thereof or therein
excluding in the case of each Bank, taxes imposed on or measured by its net
income, and franchise taxes imposed on it, by the jurisdiction under the
laws of which such Bank is organized or any political subdivision thereof
and, in the case of each Bank, taxes imposed on its income, and franchise
taxes imposed on it, by the jurisdiction of such Bank's applicable Lending
Office or any political subdivision thereof (all such non-excluded taxes,
imposts, levies, duties, deductions or withholdings of any nature being
"Taxes"). In the event that the Borrower is required by applicable law to
make any such withholding or deduction of Taxes with respect to any Loan or
fee or other amount, the Borrower shall pay such deduction or withholding
to the applicable taxing authority, shall promptly furnish to any Bank in
respect of which such deduction or withholding is made all receipts and
other documents evidencing such payment and shall pay to such Bank
additional amounts as may be necessary in order that the amount received by
<PAGE>
such Bank after the required withholding or other payment shall equal the
amount such Bank would have received had no such withholding or other
payment been made.
No Bank will charge Borrower for taxes or other fees pursuant
to this Section 2.12 or, if such taxes or fees are charged, at a higher
rate, than such Bank, charges its other similarly situated borrowers or
customers.
Each Bank which is not organized under the laws of the United
States or any state thereof agrees, as soon as practicable after receipt by
it of a request by the Borrower to do so, to file all appropriate forms and
take other appropriate action to obtain a certificate or other appropriate
document from the appropriate governmental authority in the jurisdiction
imposing the relevant Taxes, establishing that it is entitled to receive
payments of principal and interest under this Agreement and the Notes
without deduction and free from withholding of any Taxes imposed by such
jurisdiction; PROVIDED that if it is unable, for any reason, to establish
such exemption, or to file such forms and, in any event, during such period
of time as such request for exemption is pending, the Borrower shall
nonetheless remain obligated under the terms of the immediately preceding
paragraph.
In the event any Bank receives a refund of any Taxes paid by
the Borrower pursuant to this Section 2.12(c), it will pay to the Borrower
the amount of such refund promptly upon receipt thereof; PROVIDED that if
at any time thereafter it is required to return such refund, the Borrower
shall promptly repay to it the amount of such refund.
Without prejudice to the survival of any other agreement of the
Borrower hereunder, the agreements and obligations of the Borrower and the
Banks contained in this Section 2.12(c) shall be applicable with respect to
any Participant, Assignee or other Transferee, and any calculations
required by such provisions (i) shall be made based upon the circumstances
of such Participant, Assignee or other Transferee, and (ii) constitute a
continuing agreement and shall survive the termination of this Agreement
and the payment in full or cancellation of the Notes.
SECTION 2.13. COMPUTATION OF INTEREST AND FEES. Interest
on Base Rate Loans shall be computed on the basis of a year of 365 days and
paid for the actual number of days elapsed (including the first day but
excluding the last day). Interest on Euro-Dollar Loans, Money Market Loans
and Transaction Rate Loans shall be computed on the basis of a year of 360
days and paid for the actual number of days elapsed, calculated as to each
Interest Period from and including the first day thereof to but excluding
the last day thereof. Commitment fees and any other fees payable hereunder
shall be computed on the basis of a year of 360 days and paid for the
actual number of days elapsed (including the first day but excluding the
last day).
ARTICLE III
CONDITIONS TO BORROWINGS
SECTION 3.01. CLOSING CONDITIONS. The effectiveness of
this Agreement and the obligation of each Bank to make a Loan on the
occasion of the first Borrowing hereunder is subject to the satisfaction of
the conditions set forth in Section 3.02 and receipt by the Agent of the
following (as to the documents described in paragraphs (a),(c), (d) and (e)
below, in sufficient number of counterparts for delivery of a counterpart
to each Bank and retention of one counterpart by the Agent):
(a) from each of the parties hereto of either (i) a duly
executed counterpart of this Agreement signed by such party or (ii) a
facsimile transmission of such executed counterpart (with the original to
be sent to the Agent by overnight courier);
<PAGE>
(b) a duly executed Syndicated Loan Note and a duly executed
Money Market Loan Note for the account of each Bank and a duly executed
Swing Loan Note for the account of Wachovia complying with the provisions
of Section 2.03;
(c) an opinion letter of Pircher, Nichols and Meeks, counsel
for the Borrower and the Guarantors, dated as of the Closing Date,
substantially in the form of EXHIBIT B and covering such additional matters
relating to the transactions contemplated hereby as the Agent or any Bank
may reasonably request;
(d) an opinion of Jones, Day, Reavis & Pogue, special counsel
for the Agent, dated as of the Closing Date, substantially in the form of
EXHIBIT C and covering such additional matters relating to the transactions
contemplated hereby as the Agent may reasonably request;
(e) a certificate (the "Closing Certificate") substantially
in the form of EXHIBIT G), dated as of the Closing Date, signed by an
Executive Officer of the General Partner, to the effect that, (i) no
Default has occurred and is continuing on the date of the first Borrowing
and (ii) the representations and warranties of the Borrower and each
Guarantor contained in Article IV are true on and as of the date of the
first Borrowing hereunder;
(f) all documents which the Agent or any Bank may reasonably
request relating to the existence of the Borrower the partnership authority
for and the validity of this Agreement, the Notes and any other matters
relevant hereto, all in form and substance satisfactory to the Agent,
including, without limitation, a certificate and agreement of the General
Partner as of the Closing Date substantially in the form of EXHIBIT H (the
"Officer's Certificate and Agreement"), signed by an Executive Officer of
the General Partner, and certified copies of the following respective items
for the Borrower and the General Partner: (i) its Certificate of
Declaration of Trust, or Certificate of Limited Partnership, (ii) its
Declaration of Trust, Partnership Agreement, (iii) a certificate of the
Secretary of State of the State of its incorporation or creation as to its
good standing as a real estate investment trust or partnership created
therein, and (iv) the action taken by its Board of Trustees of the General
Partner authorizing the execution, delivery and performance of the Loan
Documents to which it is a party;
(g) a Notice of Borrowing or notification pursuant to Section
2.03(e) of acceptance of one or more Money Market Quotes, as applicable;
(h) receipt of the initial Borrowing Base Certificate,
showing the Borrowing Base as of last day of the Fiscal Quarter ending
prior to the Closing Date;
(i) receipt of the upfront fee payable to the Banks pursuant
to Section 2.06(a).
In addition, if the Borrower desires funding of a Fixed Rate Loan on the
Closing Date, the Agent shall have received, the requisite number of days
prior to the Closing Date, a funding indemnification letter satisfactory to
it, pursuant to which (i) the Agent and the Borrower shall have agreed upon
the interest rate, amount of Borrowing and Interest Period for such Fixed
Rate Loan, and (ii) the Borrower shall indemnify the Banks from any loss or
expense arising from the failure to close on the anticipated Closing Date
identified in such letter or the failure to borrow such Fixed Rate Loan on
such date.
<PAGE>
SECTION 3.02. CONDITIONS TO ALL BORROWINGS. The obligation
of each Bank to make a Loan on the occasion of each Borrowing is subject to
the satisfaction of the following conditions except as expressly provided
in the last sentence of this Section 3.02:
(a) receipt by the Agent of a Notice of Borrowing or
acceptance of a Transaction Rate Quote or notification pursuant to Section
2.03(e) of acceptance of one or more Money Market Quotes, as applicable;
(b) the fact that, immediately before and after such
Borrowing, no Default shall have occurred and be continuing;
(c) the fact that the representations and warranties of the
Borrower and each Guarantor contained in Article IV of this Agreement shall
be true on and as of the date of such Borrowing; and
(d) the fact that, immediately after such Borrowing, the
conditions set forth in clauses (i) and (ii) of Section 2.01(a) shall have
been satisfied.
Each Borrowing hereunder shall be deemed to be a representation and
warranty by the Borrower on the date of such Borrowing as to the truth and
accuracy of the facts specified in paragraphs (b), (c) and (d) of this
Section.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
The Borrower and (by incorporation by reference in the
Guaranty) the Guarantors, as expressly stated, each represents and warrants
that:
SECTION 4.01. PARTNERSHIP, TRUST AND CORPORATE EXISTENCE
AND POWER. (a) The Borrower is a limited partnership duly organized,
validly existing and in good standing under the laws of the jurisdiction of
its creation, is duly qualified to transact business in every jurisdiction
where, by the nature of its business, such qualification is necessary, and
has all partnership powers and all governmental licenses, authorizations,
consents and approvals required to carry on its business as now conducted,
except where any failure does not have and would not reasonably be expected
to cause a Material Adverse Effect.
(b) The General Partner is a real estate investment trust duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its creation, is duly qualified to transact business in
every jurisdiction where, by the nature of its business, such qualification
is necessary, and has all trust powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as
now conducted, except where any failure does not have and would not
reasonably be expected to cause a Material Adverse Effect. The only
general partner of borrower is and shall be AMLI Residential Properties
Trust. The only assets of the General Partner (other than cash held for
distribution to its shareholders) are and shall be its interest in the
Borrower and its interest in various partnerships in which it owns,
directly or indirectly, not more than 1% of the partnership interests and
in which Borrower owns, directly or indirectly, all of the remaining
partnership interests.
(c) Each Guarantor is a corporation or partnership duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its creation, is duly qualified to transact business in
every jurisdiction where, by the nature of its business, such qualification
is necessary, and has all corporate powers and all governmental licenses,
authorizations, consents and approvals required to carry on its business as
now conducted, except where any failure does not have and would not
reasonably be expected to cause a Material Adverse Effect.
<PAGE>
SECTION 4.02. CORPORATE AND GOVERNMENTAL AUTHORIZATION; NO
CONTRAVENTION. The execution, delivery and performance by the Borrower of
this Agreement, the Notes and the other Loan Documents and by the
Guarantors of the Guaranty and the Contribution Agreement (i) are within
the Borrower's or such Guarantor's partnership or corporate powers, (ii)
have been duly authorized by all necessary partnership or corporate action,
(iii) require no action by or in respect of or filing with, any
governmental body, agency or official, (iv) do not contravene, or
constitute a default under, any provision of applicable law or regulation
or of the certificate of incorporation, certificate of limited partnership,
partnership agreement, or by-laws of the Borrower or any Guarantor or of
any agreement, judgment, injunction, order, decree or other instrument
binding upon the Borrower or any Guarantor except where such contravention
or default does not have and would not reasonably be expected to cause a
Material Adverse Effect, and (v) do not result in the creation or
imposition of any Lien on any asset of the Borrower or any of Guarantor.
SECTION 4.03. BINDING EFFECT. This Agreement constitutes a
valid and binding agreement of the Borrower enforceable in accordance with
its terms, and the Notes, the Guaranty and the other Loan Documents, when
executed and delivered in accordance with this Agreement, will constitute
valid and binding obligations of the Borrower and the Guarantor parties
thereto, enforceable in accordance with their respective terms, PROVIDED
that the enforceability hereof and thereof is subject in each case to
general principles of equity and to bankruptcy, insolvency and similar laws
affecting the enforcement of creditors' rights generally.
SECTION 4.04. FINANCIAL INFORMATION. (a) The balance sheet
of the General Partner and the consolidated balance sheet of the Borrower
as of December 31, 1997 and the related consolidated statements of income,
shareholders' equity and cash flows for the Fiscal Year then ended,
reported on by KPMG Peat Marwick LLP, copies of which have been delivered
to each of the Banks, fairly present, in conformity with GAAP, the
financial position of the General Partner and the consolidated financial
position of the Borrower and its Consolidated Subsidiaries as of such dates
and the (with respect to the Borrower, its consolidated) results of
operations and cash flows for such periods stated.
(b) Since December 31, 1997 there has been no event, act,
condition or occurrence having a Material Adverse Effect.
SECTION 4.05. NO LITIGATION. There is no action, suit or
proceeding pending, or to the knowledge of the Borrower threatened, against
or affecting the Borrower or any of its Subsidiaries before any court or
arbitrator or any governmental body, agency or official which could have a
Material Adverse Effect or which in any manner draws into question the
validity of or could impair the ability of the Borrower to perform its
obligations under, this Agreement, the Notes or any of the other Loan
Documents.
SECTION 4.06. COMPLIANCE WITH ERISA. (a) The Borrower and
each member of the Controlled Group have fulfilled their obligations under
the minimum funding standards of ERISA and the Code with respect to each
Plan and are in compliance in all material respects with the presently
applicable provisions of ERISA and the Code, and have not incurred any
liability to the PBGC or a Plan under Title IV of ERISA.
(b) Neither the Borrower nor any member of the Controlled
Group is or ever has been obligated to contribute to any Multiemployer
Plan.
<PAGE>
SECTION 4.07. COMPLIANCE WITH LAWS; PAYMENT OF TAXES. To
the best of the Borrower's knowledge, the Borrower and its Subsidiaries are
in compliance with all applicable laws, regulations and similar
requirements of governmental authorities, except where such compliance is
being contested in good faith through appropriate proceedings, except where
(i) such compliance is being contested in good faith through appropriate
proceedings or (ii) any failure does not have and would not reasonably be
expected to cause a Material Adverse Effect. There have been filed on
behalf of the Borrower and its Subsidiaries all material Federal, state and
local income, excise, property and other tax returns which are required to
be filed by them and all taxes due pursuant to such returns or pursuant to
any assessment received by or on behalf of the Borrower or any Subsidiary
have been paid, except: (A) ad valorem taxes not due and payable; and (B)
other liabilities, if (1) they are being contested in good faith and
against which the Borrower, Guarantor or Subsidiary has set up reserves in
accordance with GAAP, or (2) the aggregate amount involved is not in excess
of $5,000,000. The charges, accruals and reserves on the books of the
Borrower and its Subsidiaries in respect of taxes or other governmental
charges are, in the opinion of the Borrower, adequate. United States
income tax returns of the General Partner, the Borrower and its
Subsidiaries have not been examined.
SECTION 4.08. SUBSIDIARIES, CO-INVESTMENT PARTNERSHIPS AND
SERVICE COMPANIES. Each of the Borrower's Subsidiaries, Co-Investment
Partnerships and Service Companies is a corporation, partnership or limited
liability corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of creation, is duly qualified to
transact business in every jurisdiction where, by the nature of its
business, such qualification is necessary, and has all corporate or
partnership powers and all governmental licenses, authorizations, consents
and approvals required to carry on its business as now conducted, except
where any failure does not have and would not reasonably be expected to
cause a Material Adverse Effect. As of the Closing Date, the Borrower has
no Subsidiaries or Co-Investment Partnerships except for those Subsidiaries
and Co-Investment Partnerships listed on Schedule 4.08, which accurately
sets forth each such Subsidiary's and Co-Investment Partnership's complete
name and jurisdiction of creation. The Borrower will promptly notify the
Agent of the creation of any new Subsidiary, and each such new Subsidiary
shall be subject to the provisions of Section 5.28.
SECTION 4.09. INVESTMENT COMPANY ACT. Neither the Borrower
nor any of its Subsidiaries is an "investment company" within the meaning
of the Investment Company Act of 1940, as amended.
SECTION 4.10. PUBLIC UTILITY HOLDING COMPANY ACT. Neither
the General Partner, the Borrower nor any of its Subsidiaries is a "holding
company", or a "subsidiary company" of a "holding company", or an
"affiliate" of a "holding company" or of a "subsidiary company" of a
"holding company", as such terms are defined in the Public Utility Holding
Company Act of 1935, as amended.
SECTION 4.11. OWNERSHIP OF PROPERTY; LIENS. Each of the
General Partner, the Borrower and its Consolidated Subsidiaries has title
to its properties sufficient for the conduct of its business, and none of
such property which constitutes Eligible Property is subject to any Lien
except as permitted in Section 5.18.
SECTION 4.12. NO DEFAULT. Neither the General Partner, the
Borrower nor any of its Consolidated Subsidiaries is in default under or
with respect to any agreement, instrument or undertaking to which it is a
party or by which it or any of its property is bound which could have or
cause a Material Adverse Effect. No Default or Event of Default has
occurred and is continuing.
<PAGE>
SECTION 4.13. FULL DISCLOSURE. All information heretofore
furnished by the Borrower to the Agent or any Bank for purposes of or in
connection with this Agreement or any transaction contemplated hereby is,
and all such information hereafter furnished by the Borrower to the Agent
or any Bank will be, true, accurate and complete in every material respect
or based on reasonable estimates on the date as of which such information
is stated or certified. The Borrower has disclosed to the Banks in writing
any and all facts which could have or cause a Material Adverse Effect.
SECTION 4.14. ENVIRONMENTAL MATTERS. (a) Except as set
forth in Schedule 4.14 (and, as approved by the Agent and the Banks in
writing, as such Schedule 4.14 is amended or supplemented from time to time
by the Borrower), to the best of the Borrower's knowledge, neither the
Borrower nor any Subsidiary is subject to any Environmental Liability which
could have or cause a Material Adverse Effect and neither the Borrower nor
any Subsidiary has been designated as a potentially responsible party under
CERCLA or under any state statute similar to CERCLA, which designation or
all such designations in effect at any time, taken as a whole, could have
or would cause a Material Adverse Effect. None of the Properties has been
identified on any current or proposed (i) National Priorities List under 40
C.F.R. Section 300, (ii) CERCLIS list or (iii) any list arising from a
state statute similar to CERCLA.
(b) Except as set forth in Schedule 4.14 (and, as approved by
the Agent and the Banks in writing, as such Schedule 4.14 is amended or
supplemented from time to time by the Borrower), to the best of the
Borrower's knowledge, no Hazardous Materials have been or are being used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed or otherwise handled at, or shipped or transported to
or from the Properties or are otherwise present at, on, in or under the
Properties, or, to the best of the knowledge of the Borrower, at or from
any adjacent site or facility, except for Hazardous Materials, such as
cleaning solvents, pesticides, petroleum product and other materials used,
produced, manufactured, processed, treated, recycled, generated, stored,
disposed of, managed, or otherwise handled in the ordinary course of
business in material compliance with all applicable Environmental
Requirements.
(c) The Borrower, and each of its Subsidiaries and
Affiliates, has procured all Environmental Authorizations necessary for the
conduct of its business, and is in compliance with all Environmental
Requirements in connection with the operation of the Properties and the
Borrower's, and each of its Subsidiary's and Affiliate's, respective
businesses, except where any such non-compliance would not have a Material
Adverse Effect.
SECTION 4.15. CAPITAL STOCK. All Capital Stock, beneficial
interests, debentures, bonds, notes and all other securities of the General
Partner, the Borrower and its Subsidiaries presently issued and outstanding
are validly and properly issued in all material respects in accordance with
all applicable laws, including, but not limited to, the "Blue Sky" laws of
all applicable states and the federal securities laws. The issued shares
of Capital Stock of the Borrower's Wholly Owned Subsidiaries are owned by
the Borrower free and clear of any Lien or adverse claim. At least a
majority of the issued shares of Capital Stock of each of the Borrower's
other Subsidiaries (other than Wholly Owned Subsidiaries) is owned by the
Borrower, and all such shares which are owned by the Borrower are owned by
it free and clear of any Lien or adverse claim.
SECTION 4.16. MARGIN STOCK. Neither the Borrower nor any
of its Subsidiaries is engaged principally, or as a significant part of its
business, in the business of purchasing or carrying any Margin Stock, and
no part of the proceeds of any Loan will be used to purchase or carry any
Margin Stock or to extend credit to others for the purpose of purchasing or
carrying any Margin Stock, or be used for any purpose which violates, or
which is inconsistent with, the provisions of Regulation T, U or X.
<PAGE>
SECTION 4.17. INSOLVENCY. After giving effect to the
execution and delivery of the Loan Documents and the making of the Loans
under this Agreement: (i) the Borrower will not (x) be "insolvent," within
the meaning of such term as used in O.C.G.A. Section 18-2-22 or as defined
in Section 101 of the "Bankruptcy Code", or Section 2 of either the "UFTA"
or the "UFCA", or as defined or used in any "Other Applicable Law" (as
those terms are defined below), or (y) be unable to pay its debts generally
as such debts become due within the meaning of Section 548 of the
Bankruptcy Code, Section 4 of the UFTA or Section 6 of the UFCA, or (z)
have an unreasonably small capital to engage in any business or
transaction, whether current or contemplated, within the meaning of Section
548 of the Bankruptcy Code, Section 4 of the UFTA or Section 5 of the UFCA;
and (ii) the obligations of the Borrower under the Loan Documents and with
respect to the Loans will not be rendered avoidable under any Other
Applicable Law. For purposes of this Section 4.17, "Bankruptcy Code" means
Title 11 of the United States Code, "UFTA" means the Uniform Fraudulent
Transfer Act, "UFCA" means the Uniform Fraudulent Conveyance Act, and
"Other Applicable Law" means any other applicable law pertaining to
fraudulent transfers or acts voidable by creditors, in each case as such
law may be amended from time to time.
SECTION 4.18. INSURANCE. The Borrower and each of its
Subsidiaries has (either in the name of the Borrower or in such
Subsidiary's own name), with financially sound and reputable insurance
companies, all-risk insurance in at least such amounts as are usually
obtained in the same general area by companies of established repute
engaged in the same or similar business.
SECTION 4.19. REAL ESTATE INVESTMENT TRUST; SOLE GENERAL
PARTNER. The General Partner is qualified under the Code as a real estate
investment trust and is the sole general partner of the Borrower.
SECTION 4.20. YEAR 2000 COMPLIANCE. The Borrower (i) has
developed, or is developing, a program to evaluate the ability of its
computer hardware and software systems and programs to handle effectively
data that includes dates after December 31, 1999 ("Year 2000 Compliant"),
and (ii) has taken, or is in the process of taking, reasonable corrective
action as necessary to make its computer hardware and software systems Year
2000 Compliant by December 31, 1999. Based on the foregoing, the Borrower
does not expect that any Material Adverse Effect will exist or occur on or
after January 1, 2000 as a result of any of its computer hardware or
software systems or programs failing to be Year 2000 Compliant.
ARTICLE V
COVENANTS
The Borrower and (by incorporation by reference in the
Guaranty) the Guarantors agree that, so long as any Bank has any Commitment
hereunder or any amount payable hereunder or under any Note remains unpaid:
SECTION 5.01. INFORMATION. The Borrower will deliver to
each of the Banks:
(a) as soon as available and in any event within 90 days
after the end of each Fiscal Year, a consolidated balance sheet of the
General Partner and a consolidated balance sheet of the Borrower and the
Guarantors as of the end of such Fiscal Year and the related (with respect
to the Borrower, its consolidated) statements of income, shareholders'
equity and cash flows for such Fiscal Year, setting forth in each case in
comparative form the figures for the previous fiscal year, in either case
audited by KPMG Peat Marwick LLP or other independent public accountants of
nationally recognized standing, with such audit opinion to be free of
material exceptions and qualifications not acceptable to the Required
Banks;
<PAGE>
(b) as soon as available and in any event within 45 days
after the end of each of the first 3 Fiscal Quarters of each Fiscal Year, a
(with respect to the Borrower, its consolidated) balance sheet of the
Borrower and the Guarantors as of the end of such Fiscal Quarter and the
related statement of income and statement of cash flows for such Fiscal
Quarter and for the portion of the Fiscal Year ended at the end of such
Fiscal Quarter, setting forth in each case in comparative form the figures
for the corresponding Fiscal Quarter and the corresponding portion of the
previous Fiscal Year, all certified (subject to normal year-end
adjustments) as to fairness of presentation, GAAP and consistency by an
Executive Officer of the General Partner;
(c) simultaneously with the delivery of each set of financial
statements referred to in paragraphs (a) and (b) above, a certificate,
substantially in the form of EXHIBIT F (a "Compliance Certificate"), of an
Executive Officer of the General Partner (i) setting forth in reasonable
detail the calculations required to establish whether the Borrower was in
compliance with the requirements of Sections 5.05, 5.15, 5.16, 5.17, 5.20
through 5.24, inclusive, and 5.26 on the date of such financial statements
and (ii) stating whether any Default exists on the date of such certificate
and, if any Default then exists, setting forth the details thereof and the
action which the Borrower is taking or proposes to take with respect
thereto;
(d) within 5 Domestic Business Days after the Borrower
becomes aware of the occurrence of any Default, a certificate of the chief
financial officer or the chief accounting officer of the Borrower setting
forth the details thereof and the action which the Borrower is taking or
proposes to take with respect thereto;
(e) promptly upon the mailing thereof to the shareholders of
the Borrower generally, copies of all financial statements, reports and
proxy statements so mailed;
(f) promptly upon the filing thereof, copies of all
registration statements (other than the exhibits thereto and any
registration statements on Form S-8 or its equivalent) and annual,
quarterly or monthly reports which the Borrower shall have filed with the
Securities and Exchange Commission;
(g) if and when any member of the Controlled Group (i) gives
or is required to give notice to the PBGC of any "reportable event" (as
defined in Section 4043 of ERISA) with respect to any Plan which might
constitute grounds for a termination of such Plan under Title IV of ERISA,
or knows that the plan administrator of any Plan has given or is required
to give notice of any such reportable event; (ii) receives notice of
complete or partial withdrawal liability under Title IV of ERISA; (iii)
receives notice from the PBGC under Title IV of ERISA of an intent to
terminate or appoint a trustee to administer any Plan; or (iv) contributes
to or becomes obligated to contribute to a Multiemployer Plan, or incurs
any withdrawal liability with respect to a Multiemployer Plan; THEN a copy
of any such notice referred to in clauses (i) through (iii) of this
paragraph, and a detailed description of the amount and the circumstances
of such contribution or withdrawal liability obligation referred to in
clause (iv) of this paragraph;
(h) within 60 days after the end of each Fiscal Quarter, and
more frequently, at the election of the Borrower, a Borrowing Base
Certificate as of the last day of the Fiscal Quarter just ended;
<PAGE>
(i) simultaneously with the delivery of each set of financial
statements referred to in paragraphs (a) and (b) above, operating
statements for each Eligible Property for the period covered by such
financial statements; and
(j) from time to time such additional information regarding
the financial position or business of the Borrower and the Guarantors as
the Agent, at the request of any Bank, may reasonably request.
SECTION 5.02. INSPECTION OF PROPERTY, BOOKS AND RECORDS.
The Borrower, the Guarantors and the General Partner will (i) keep proper
books of record and account in which full, true and correct entries in
conformity with GAAP shall be made of all dealings and transactions in
relation to its business and activities; and (ii) permit representatives of
any Bank at such Bank's expense prior to the occurrence of a Default and at
the Borrower's expense after the occurrence of a Default to visit and
inspect any of their respective properties, to examine and make abstracts
from any of their respective books and records and to discuss their
respective affairs, finances and accounts with their respective officers,
employees and independent public accountants. The Borrower, the General
Partner and the Guarantors agree to cooperate and assist in such visits and
inspections, in each case at such reasonable times and as often as may
reasonably be desired.
SECTION 5.03. MAINTENANCE OF EXISTENCE. The Borrower, the
General Partner and the Guarantors will, subject to Sections 5.04 and 5.05,
each maintain its respective partnership, corporate and trust existence and
carry on its respective business in substantially the same manner and in
substantially the same fields as such business is now carried on and
maintained.
SECTION 5.04. DISSOLUTION. Neither the Borrower nor any of
the Guarantors shall suffer or permit dissolution or liquidation either in
whole or in part or redeem or retire any shares of its own stock or that of
any Guarantor, except for Partner Conversions.
SECTION 5.05. CONSOLIDATIONS, MERGERS AND SALES OF ASSETS.
Neither the Borrower, the General Partner nor any of the Guarantors will
consolidate or merge with or into, or acquire all or substantially all of
the assets or stock of any other Person, or sell, lease or otherwise
transfer all or any substantial part of its assets to, any other Person,
PROVIDED that:
(i) the Borrower may merge with another Person if (x) such
Person was organized under the laws of the United States of America or one
of its states, (y) the Borrower is the limited partnership surviving such
merger and (z) immediately after giving effect to such merger, no Default
shall have occurred and be continuing;
(ii) Guarantors may merge with one another, and the Guarantors
may sell, lease or otherwise transfer assets to the Borrower;
(iii) the foregoing limitation on the acquisition of all or
substantially all the assets or stock of another Person shall not prohibit,
during any Fiscal Quarter, the acquisition of all or substantially all of
the assets or stock of another Person unless the aggregate assets or stock
acquired in a single acquisition or series of related acquisitions of all
or substantially all of the assets or stock of another Person by the
Borrower, the General Partner and the Guarantors during such Fiscal Quarter
constituted more than 20% of Gross Asset Value at the end of the most
recent Fiscal Quarter immediately preceding such Fiscal Quarter; and
<PAGE>
(iv) the foregoing limitation on the sale, lease or other
transfer of assets shall not prohibit, during any Fiscal Quarter, a
transfer of assets (in a single transaction or in a series of related
transactions) unless the aggregate assets to be so transferred, when
combined with all other assets transferred, by the Borrower, the General
Partner and the Guarantors during such Fiscal Quarter and the immediately
preceding 3 Fiscal Quarters, constituted more than 20% of Gross Asset Value
at the end of the most recent Fiscal Year immediately preceding such Fiscal
Quarter.
In the case of any Guarantor which transfers substantially all of its
assets pursuant to clause (iv) of the preceding sentence, and in the case
of any Guarantor the stock of which is being sold and with respect to which
clause (iv) would have been satisfied if the transaction had been a sale of
assets of such Guarantor, such Guarantor may dissolve and shall be entitled
to obtain from the Agent a written release from the Guaranty, PROVIDED that
it can demonstrate to the reasonable satisfaction of the Agent that (A) it
has repaid in full all Debt owed to the Borrower or any other Guarantor and
(B) such sale was for cash and in the case of an asset transfer, the net
cash proceeds received in connection therewith are being distributed to the
Borrower as part of such dissolution, and upon obtaining such written
release, it shall no longer be a Guarantor for any purpose hereunder.
SECTION 5.06. USE OF PROCEEDS. The proceeds of the Loans
may be used for payment in full of the existing deed to secure debt in
favor of Wachovia covering the Sope Creek Properties, construction
financing, working capital and general commercial purposes; PROVIDED,
HOWEVER, that no portion of the proceeds of the Loans will be used by the
Borrower or any Subsidiary (i) in connection with, whether directly or
indirectly, any tender offer for, or other acquisition of, stock of any
corporation with a view towards obtaining control of such other
corporation, unless such tender offer or other acquisition is to be made on
a negotiated basis with the approval of the Board of Directors of the
Person to be acquired, and the provisions of Section 5.17 would not be
violated, (ii) directly or indirectly, for the purpose, whether immediate,
incidental or ultimate, of purchasing or carrying any Margin Stock, or
(iii) for any purpose in violation of any applicable law or regulation.
SECTION 5.07. COMPLIANCE WITH LAWS; PAYMENT OF TAXES. The
Borrower, the General Partner and the Guarantors will, and will cause each
member of the Controlled Group to, comply with applicable laws (including
but not limited to ERISA), regulations and similar requirements of
governmental authorities (including but not limited to PBGC), except where
(i) the necessity of such compliance is being contested in good faith
through appropriate proceedings diligently pursued or (ii) any failure does
not have and would not reasonably be expected to cause a Material Adverse
Effect. The Borrower, the General Partner and the Guarantors will pay
promptly when due all taxes, assessments, governmental charges, claims for
labor, supplies, rent and other obligations which, if unpaid, might become
a lien against the Property of the Borrower or any Guarantor, except (i)
liabilities being contested in good faith and against which, if requested
by the Agent, the Borrower will set up reserves in accordance with GAAP, or
(2) the aggregate amount involved is not in excess of $5,000,000.
SECTION 5.08. INSURANCE. The Borrower, the General Partner
and the Guarantors will maintain (either in the name of the Borrower, the
General Partner or in such Guarantor's own name), with financially sound
and reputable insurance companies, all-risk insurance on all its property
in at least such amounts as are usually obtained in the same general area
by companies of established repute engaged in the same or similar business.
SECTION 5.09. CHANGE IN FISCAL YEAR. The Borrower and each
of the Guarantors agrees that it will not change its Fiscal Year without
the consent of the Required Banks.
<PAGE>
SECTION 5.10. MAINTENANCE OF PROPERTY. The Borrower, the
General Partner and each Guarantor shall maintain in all material respects
all of its Properties and assets in good condition, repair and working
order, ordinary wear and tear excepted.
SECTION 5.11. ENVIRONMENTAL NOTICES. The Borrower and each
Guarantor shall furnish to the Banks and the Agent prompt written notice of
all Environmental Liabilities, pending, threatened or anticipated
Environmental Proceedings, Environmental Notices, Environmental Judgments
and Orders, and Environmental Releases at, on, in, under or in any way
affecting the Properties or any adjacent property, and all facts, events,
or conditions that could lead to any of the foregoing, which has had or
would reasonably be expected to cause a Material Adverse Effect.
SECTION 5.12. ENVIRONMENTAL MATTERS. The Borrower and the
Guarantors will not, and will not permit any Third Party to, use, produce,
manufacture, process, treat, recycle, generate, store, dispose of, manage
at, or otherwise handle, or ship or transport to or from the Properties any
Hazardous Materials except for Hazardous Materials such as cleaning
solvents, pesticides and other similar materials used, produced,
manufactured, processed, treated, recycled, generated, stored, disposed,
managed, or otherwise handled in minimal amounts in the ordinary course of
business in compliance with all applicable Environmental Requirements,
except where any failure does not have and would not reasonably be expected
to cause a Material Adverse Effect.
SECTION 5.13. ENVIRONMENTAL RELEASE. The Borrower and each
Guarantor agrees that upon the occurrence of an Environmental Release at or
on any of the Properties it will act immediately to investigate the extent
of, and to take appropriate remedial action to eliminate, such
Environmental Release, whether or not ordered or otherwise directed to do
so by any Environmental Authority, except where any Environmental Release
does not have and would not reasonably be expected to cause a Material
Adverse Effect.
SECTION 5.14. TRANSACTIONS WITH AFFILIATES. Neither the
General Partner, the Borrower nor any of the Guarantors shall enter into,
or be a party to, any transaction with any Affiliate of the Borrower or
such Guarantor (which Affiliate is not the General Partner, the Borrower or
a Guarantor), except as permitted by law and in the ordinary course of
business and pursuant to reasonable terms and are no less favorable to the
General Partner, Borrower or such Subsidiary than would be obtained in a
comparable arm's length transaction with a Person which is not an
Affiliate.
SECTION 5.15. RESTRICTED PAYMENTS. The Borrower's
Restricted Payments in any calendar year shall not exceed 95% of Funds From
Operations for such period, unless (i) the Borrower must pay out an amount
in excess of 95% of Funds From Operations to permit the General Partner to
preserve its status as a real estate investment trust under the applicable
provision of the Code, or (ii) the Borrower declares one or more capital
gains dividends within such calendar year (in which event the amount of
additional Restricted Payments that may be made as a result of such
declaration as provided in this clause (ii) shall not exceed the greater of
(A) the income tax liability of the Borrower's partners with respect
thereto and (B) $1,500,000). In the event that the Borrower receives an
Investment Grade Debt Rating and so long as that rating (or a better
rating) is affirmed during each year, the Borrower's Restricted Payments in
any calendar year will be limited to 100% of Funds from Operations for such
calendar year with the same exceptions contained in clauses (i) and (ii) of
this Section 5.15.
<PAGE>
SECTION 5.16. LOANS OR ADVANCES. Neither the Borrower, the
General Partner nor any of the Guarantors shall make loans or advances to
any Person except as permitted by Section 5.17 and except:
(i) deposits required by government agencies or public
utilities;
(ii) loans or advances from the Borrower to a Guarantor or from
a Guarantor to the Borrower or another Guarantor;
(iii) loans and advances made to (A) Amli Institutional
Advisors, Inc. as part of its initial capital structure in the amount of
$500,000, and (B) Amli Management Company as part of its initial capital
structure in the amount of $3,000,000;
(iv) loans or advances to employees, officers and directors not
exceeding $1,000,000 in the aggregate principal amount outstanding at any
time, in each case made in the ordinary course of business, but excluding
loans and advances described in clause (v);
(v) loans and advances to employees, officers and directors to
enable them to buy partnership units in the Borrower or stock in the
General Partner which are secured by a pledge of such stock, so long as the
aggregate amount of all such loans does not exceed $10,000,000;
(vi) working capital loans and advances to Amli Residential
Construction, Inc. for use in the ordinary course of business and
consistent with past practices, so long as the aggregate principal amount
outstanding at any time for all such loans and advances is not in excess of
$15,000,000;
(vii) loans and advances to Co-Investment Partnerships in an
aggregate amount which, together with Investments in Co-Investment
Partnerships, does not exceed (i) so long as the Borrower has no Investment
Grade Debt Rating, 15% of Gross Asset Value and (ii) while the Borrower has
an Investment Grade Debt Rating, 20% of Gross Asset Value; and/or
(viii) other loans and advances by the Borrower, the General
Partner and the Guarantors to any Person other than a Co-Investment
Partnership which (x) are evidenced by notes (and, if requested by the
Agent, acting at the direction of the Required Banks, with such notes,
together with any related mortgage, have been assigned to and pledged with
the Agent, for the benefit of itself and the Banks, as security for the
payment of all obligations of the Borrower to the Agent and the Banks
hereunder) and (y) are in an amount which, together with Investments
permitted by clause (vii) of Section 5.17, do not exceed 5% of Gross Asset
Value as of the end of the most recent Fiscal Quarter;
PROVIDED that after giving effect to the making of any loans, advances or
deposits permitted by this Section, no Default shall be in existence or be
created thereby.
SECTION 5.17. INVESTMENTS. Investments of the Borrower as
of the Closing Date (other than in Subsidiaries and Co-Investment
Partnerships, which are set forth in Schedule 4.08), are set forth on
Schedule 5.17. Neither the Borrower, the General Partner nor any of the
Guarantors shall make Investments after the Closing Date in any Person
except as permitted by Section 5.16 and except Investments in:
(i) direct obligations of the United States Government maturing
within one year;
(ii) certificates of deposit issued by a commercial bank whose
credit is satisfactory to the Agent;
<PAGE>
(iii) commercial paper rated A1 or the equivalent thereof by
S&P or P1 or the equivalent thereof by Moody's and in either case maturing
within 6 months after the date of acquisition;
(iv) tender bonds the payment of the principal of and interest
on which is fully supported by a letter of credit issued by a United States
bank whose long-term certificates of deposit are rated at least A or the
equivalent thereof by S&P and A or the equivalent thereof by Moody's;
(v) Investments consisting of the acquisition of all or
substantially all of the assets or stock of another Person permitted by
Section 5.05(iii);
(vi) Investments in Co-Investment Partnerships permitted by
Section 5.26; and/or
(vii) other Investments by the Borrower, the General Partner
and the Guarantors, other than in Co-Investment Partnerships, in an amount
which, together with loans and advances permitted by clause (viii) of
Section 5.16, do not exceed 5% of Gross Asset Value as of the end of the
most recent Fiscal Quarter;
PROVIDED, HOWEVER, immediately after giving effect to the making of any
Investment, no Default shall have occurred and be continuing.
SECTION 5.18. LIENS ON ELIGIBLE PROPERTY. Neither the
Borrower nor any Guarantor will create, assume or suffer to exist any Lien
on any Eligible Property now owned or hereafter acquired by it, except: (i)
Liens incidental to the conduct of its business or the ownership of its
assets which (x) do not secure Debt and (y) do not in the aggregate
materially detract from the value of its assets or materially impair the
use thereof in the operation of its business; and (ii) as permitted by the
proviso contained in the definition of Eligible Property.
SECTION 5.19. RESTRICTIONS ON ABILITY OF GUARANTORS TO PAY
DIVIDENDS. The Borrower shall not permit any Guarantor to, directly or
indirectly, create or otherwise cause or suffer to exist or become
effective any contractual encumbrance or restriction on the ability of any
such Guarantor to (i) pay any dividends or make any other distributions on
its Capital Stock or any other interest or (ii) make or repay any loans or
advances to the Borrower or the parent of such Guarantor.
SECTION 5.20. RATIO OF TOTAL CONSOLIDATED LIABILITIES TO
UNDEPRECIATED BOOK ASSET VALUE. The ratio of Total Consolidated Liabilities
to Undepreciated Book Asset Value shall at all times be equal to or less
than 0.60 to 1.0.
SECTION 5.21. RATIO OF TOTAL SECURED DEBT TO GROSS ASSET
VALUE. The ratio of Total Secured Debt to Gross Asset Value shall at all
times be equal to or less than 0.45 to 1.0.
SECTION 5.22. RATIO OF EBITDA TO CONSOLIDATED INTEREST
EXPENSE. The ratio of EBITDA to Consolidated Interest Expense for the
Fiscal Quarter just ended will not be less than 2.0 to 1.0, calculated at
the end of each Fiscal Quarter.
SECTION 5.23. RATIO OF UNENCUMBERED ASSETS TO UNSECURED
FUNDED DEBT. The ratio of Unencumbered Assets to Unsecured Funded Debt
shall at all times be equal to or greater than 1.75 to 1.00.
SECTION 5.24. RATIO OF UNSECURED NET OPERATING INCOME TO
UNSECURED INTEREST EXPENSE. The ratio of Unsecured Net Operating Income to
Unsecured Interest Expense shall at all times be equal to or greater than
2.0 to 1.0.
<PAGE>
SECTION 5.25. ADDITIONAL DEBT. Neither the Borrower, the
General Partner nor any Guarantor will create, incur, assume or suffer to
exist any Debt except (i) Debt in existence on June 27, 1997,; (ii) Debt of
any Guarantor to the Borrower, (iii) publicly held debt having a maturity
later than the Termination Date, and (iv) other Debt which is privately
held and which does not constitute revolving credit.
SECTION 5.26. CO-INVESTMENT PARTNERSHIPS DEPRECIATED BOOK
VALUE. The amount of the depreciated book value set forth on the line item
designated as "Investments in Partnerships" on the Borrower's consolidated
balance sheet, together with the aggregate amount of loans and advances to
Co-Investment Partnerships permitted by clause (vii) of Section 5.16, shall
not at any time exceed (i) so long as the Borrower does not have an
Investment Grade Debt Rating, 15% of Gross Asset Value and (ii) while the
Borrower has an Investment Grade Debt Rating, 20% of Gross Asset Value.
SECTION 5.27. STATUS AS A REIT. The General Partner shall
at all times maintain its status as a real estate investment trust under
the Code and remain sole general partner of the Borrower. Neither the
Borrower nor the General Partner will agree to amend or otherwise modify
the provisions of Section 3.2 of the limited partnership agreement of the
Borrower, as in effect on the date of this Agreement, without the prior
written consent of the Required Banks (which consent the Banks hereby agree
not to unreasonably withhold or delay).
SECTION 5.28. NEW SUBSIDIARIES TO BECOME GUARANTORS. Any
Subsidiary acquired or created after June 27, 1997, (other than Co-
Investment Partnerships), must become a Guarantor promptly upon its
acquisition or creation, in each case by (x) executing and delivering to
the Agent a counterpart of the Guaranty and a counterpart of the
Contribution Agreement, thereby becoming a party to each of them, (y)
delivering to the Agent an opinion of counsel to such Subsidiary, in
substantially the form and substance of EXHIBIT B, but limited to such
Subsidiary and the Guaranty and Contribution Agreement, and excluding
paragraph 2 thereof, and (z) delivering to the Agent documents pertaining
to the Subsidiary reasonably requested by the Agent of the types described
in paragraph (f) of Section 3.01, but relating to the Guaranty and the
Contribution Agreement.
SECTION 5.29. SERVICE COMPANY DISTRIBUTIONS. The Borrower
agrees that (i) it shall not amend or otherwise modify any corporate
charter of or similar agreement relating to any Service Company which would
decrease the amount of preferred stock dividends or yield with respect
thereto which would be received by the Borrower, and (ii) shall hold at all
times an Economic Percentage in each Service Company equal to at least 75%.
ARTICLE VI
DEFAULTS
SECTION 6.01. EVENTS OF DEFAULT. If one or more of the
following events ("Events of Default") shall have occurred and be
continuing:
(a) the Borrower shall fail to pay when due any principal of
any Loan or shall fail to pay any interest on any Loan within 5 Domestic
Business Days after such interest shall become due, or shall fail to pay
any fee or other amount payable hereunder within 5 Domestic Business Days
after such fee or other amount becomes due; or
(b) the Borrower or the General Partner shall fail to observe
or perform any covenant contained in Sections 5.01(d), 5.01(h), 5.02(ii),
5.03 through 5.06, inclusive, Sections 5.16 through 5.24, inclusive, or
Sections 5.26 through 5.28, inclusive; or
<PAGE>
(c) the Borrower, the General Partner or any Guarantor shall
fail to observe or perform any covenant or agreement contained or
incorporated by reference in this Agreement (other than those covered by
paragraph (a) or (b) above) or the Guaranty and such failure shall not have
been cured within 30 days after the earlier to occur of (i) written notice
thereof has been given to the Borrower, the General Partner or such
Guarantor by the Agent at the request of any Bank or (ii) the Borrower, the
General Partner or such Guarantor otherwise becomes aware of any such
failure; or
(d) any representation, warranty, certification or statement
made by the Borrower, the General Partner or any Guarantor in Article IV of
this Agreement or the Guaranty or in any certificate, financial statement
or other document delivered pursuant to this Agreement or the Guaranty
shall prove to have been incorrect or misleading in any material respect
when made (or deemed made); or
(e) the Borrower, the General Partner or any Guarantor shall
fail to make any payment in respect of the Harris Trust Facility or Debt in
an aggregate principal amount outstanding in excess of $10,000,000 (other
than the Notes), or under any Hedging Agreement with a termination value in
excess of $10,000,000 (computed in accordance with a method approved by the
International Swap Dealers Association and agreed to by such Person in the
applicable Hedging Agreement) when due or within any applicable grace
period; PROVIDED, HOWEVER, that there shall be excluded from the foregoing
any Non-Recourse Mortgage Debt which, on a cumulative basis since June 27,
1997, does not exceed $25,000,000 in aggregate principal amount; or
(f) any event or condition (other than the voluntary
termination of the Harris Trust Facility, by the Borrower or Harris Trust
and Savings Bank, while no uncured "default" or "event of default" (as
defined therein) has occurred and then exists) shall occur which results in
the acceleration of the maturity or termination of the Harris Trust
Facility or the acceleration of the maturity of Debt (other than the
voluntary termination of a credit facility, by the Borrower or the creditor
thereunder, while no uncured "default" or "event of default" (as defined
therein) has occurred and then exists) in an aggregate principal amount
outstanding in excess of $10,000,000 of the Borrower, the General Partner
or any Guarantor (including, without limitation, any required mandatory
prepayment or "put" of such Debt to the Borrower, the General Partner or
any Guarantor) or enables (or, with the giving of notice or lapse of time
or both, would enable) the holders of such Debt or commitment or any Person
acting on such holders' behalf to accelerate the maturity thereof or
terminate any such commitment (including, without limitation, any required
mandatory prepayment or "put" of such Debt to the Borrower, the General
Partner or any Guarantor); PROVIDED, HOWEVER, that there shall be excluded
from the foregoing any Non-Recourse Mortgage Debt which does not exceed
$25,000,000 in aggregate principal amount; or
(g) the Borrower, the General Partner or any Guarantor shall
commence a voluntary case or other proceeding seeking liquidation,
reorganization or other relief with respect to itself or its debts under
any bankruptcy, insolvency or other similar law now or hereafter in effect
or seeking the appointment of a trustee, receiver, liquidator, custodian or
other similar official of it or any substantial part of its property, or
shall consent to any such relief or to the appointment of or taking
possession by any such official in an involuntary case or other proceeding
commenced against it, or shall make a general assignment for the benefit of
creditors, or shall admit in writing its inability or failure generally, to
pay its debts as they become due, or shall take any action to authorize any
of the foregoing; or
<PAGE>
(h) an involuntary case or other proceeding shall be
commenced against the Borrower, the General Partner or any Guarantor
seeking liquidation, reorganization or other relief with respect to it or
its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian or other similar official of it or any substantial
part of its property, and such involuntary case or other proceeding shall
remain undismissed and unstayed for a period of 60 days; or an order for
relief shall be entered against the Borrower, the General Partner or any
Guarantor under the federal bankruptcy laws as now or hereafter in effect;
or
(i) the Borrower, the General Partner, any Guarantor or any
member of the Controlled Group shall fail to pay when due any material
amount which it shall have become liable to pay to the PBGC or to a Plan
under Title IV of ERISA; or notice of intent to terminate a Plan or Plans
shall be filed under Title IV of ERISA by the Borrower, the General
Partner, any Guarantor or any member of the Controlled Group, any plan
administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Subsection (c) of section 4041 of ERISA to
terminate or to cause a trustee to be appointed to administer any such Plan
or Plans or a proceeding shall be instituted by a fiduciary of any such
Plan or Plans to enforce Section 515 or 4219(c)(5) of ERISA and such
proceeding shall not have been dismissed within 30 days thereafter; or a
condition shall exist by reason of which the PBGC would be entitled to
obtain a decree adjudicating that any such Plan or Plans must be
terminated; or
(j) one or more judgments or orders for the payment of money
in an aggregate amount in excess of $10,000,000 shall be rendered against
the Borrower, the General Partner or any Guarantor and such judgment or
order shall continue unsatisfied and unstayed for a period of 30 days; or
(k) a federal tax lien shall be filed against the Borrower,
the General Partner or any Guarantor under Section 6323 of the Code or a
lien of the PBGC shall be filed against the Borrower, the General Partner
or any Guarantor under Section 4068 of ERISA and in either case such lien
shall remain undischarged for a period of 25 days after the date of filing;
or
(l) the occurrence of any event, act, occurrence, or
condition which the Required Banks determine either does or has a
reasonable probability of causing a Material Adverse Effect.
then, and in every such event, (i) the Agent shall, if requested by the
Required Banks, by notice to the Borrower terminate the Commitments and the
obligation to make Swing Loans and they shall thereupon terminate, (ii) any
Bank may terminate its obligation to fund a Money Market Loan in connection
with any relevant Money Market Quote, and (iii) the Agent shall, if
requested by the Required Banks, by notice to the Borrower declare the
Notes (together with accrued interest thereon), and all other amounts
payable hereunder and under the other Loan Documents, to be, and the Notes
(together with accrued interest thereon), and all other amounts payable
hereunder and under the other Loan Documents shall thereupon become,
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower together
with interest at the Default Rate accruing on the principal amount thereof
from and after the date of such Event of Default; PROVIDED that if any
Event of Default specified in paragraph (g) or (h) above occurs with
respect to the Borrower, without any notice to the Borrower or any other
act by the Agent or the Banks, the Commitments and the obligations to make
Swing Loans shall thereupon terminate and the Notes (together with accrued
interest thereon) and all other amounts payable hereunder and under the
other Loan Documents shall automatically and without notice become
immediately due and payable without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrower together
<PAGE>
with interest thereon at the Default Rate accruing on the principal amount
thereof from and after the date of such Event of Default. Notwithstanding
the foregoing, the Agent shall have available to it all other remedies at
law or equity, and shall exercise any one or all of them at the request of
the Required Banks.
SECTION 6.02. NOTICE OF DEFAULT. The Agent shall give
notice to the Borrower of any Default under Section 6.01(c) promptly upon
being requested to do so by any Bank and shall thereupon notify all the
Banks thereof.
ARTICLE VII
THE AGENT
SECTION 7.01. APPOINTMENT; POWERS AND IMMUNITIES. Each
Bank hereby irrevocably appoints and authorizes the Agent to act as its
agent hereunder and under the other Loan Documents with such powers as are
specifically delegated to the Agent by the terms hereof and thereof,
together with such other powers as are reasonably incidental thereto. The
Agent: (a) shall have no duties or responsibilities except as expressly set
forth in this Agreement and the other Loan Documents, and shall not by
reason of this Agreement or any other Loan Document be a trustee for any
Bank; (b) shall not be responsible to the Banks for any recitals,
statements, representations or warranties contained in this Agreement or
any other Loan Document, or in any certificate or other document referred
to or provided for in, or received by any Bank under, this Agreement or any
other Loan Document, or for the validity, effectiveness, genuineness,
enforceability or sufficiency of this Agreement or any other Loan Document
or any other document referred to or provided for herein or therein or for
any failure by the Borrower to perform any of its obligations hereunder or
thereunder; (c) shall not be required to initiate or conduct any litigation
or collection proceedings hereunder or under any other Loan Document except
to the extent requested by the Required Banks, and then only on terms and
conditions satisfactory to the Agent, and (d) shall not be responsible for
any action taken or omitted to be taken by it hereunder or under any other
Loan Document or any other document or instrument referred to or provided
for herein or therein or in connection herewith or therewith, except for
its own gross negligence or wilful misconduct. The Agent may employ agents
and attorneys-in-fact and shall not be responsible for the negligence or
misconduct of any such agents or attorneys-in-fact selected by it with
reasonable care. The provisions of this Article VII are solely for the
benefit of the Agent and the Banks, and the Borrower shall not have any
rights as a third party beneficiary of any of the provisions hereof. In
performing its functions and duties under this Agreement and under the
other Loan Documents, the Agent shall act solely as agent of the Banks and
does not assume and shall not be deemed to have assumed any obligation
towards or relationship of agency or trust with or for the Borrower. The
duties of the Agent shall be ministerial and administrative in nature, and
the Agent shall not have by reason of this Agreement or any other Loan
Document a fiduciary relationship in respect of any Bank.
SECTION 7.02. RELIANCE BY AGENT. The Agent shall be
entitled to rely upon any certification, notice or other communication
(including any thereof by telephone, telecopier, telegram or cable)
believed by it to be genuine and correct and to have been signed or sent by
or on behalf of the proper Person or Persons, and upon advice and
statements of legal counsel, independent accountants or other experts
selected by the Agent. As to any matters not expressly provided for by
this Agreement or any other Loan Document, the Agent shall in all cases be
fully protected in acting, or in refraining from acting, hereunder and
thereunder in accordance with instructions signed by the Required Banks,
and such instructions of the Required Banks in any action taken or failure
to act pursuant thereto shall be binding on all of the Banks.
<PAGE>
SECTION 7.03. DEFAULTS. The Agent shall not be deemed to
have knowledge of the occurrence of a Default or an Event of Default (other
than the nonpayment of principal of or interest on the Loans) unless the
Agent has received notice from a Bank or the Borrower specifying such
Default or Event of Default and stating that such notice is a "Notice of
Default". In the event that the Agent receives such a notice of the
occurrence of a Default or an Event of Default, the Agent shall give prompt
notice thereof to the Banks. The Agent shall give each Bank prompt notice
of each nonpayment of principal of or interest on the Loans whether or not
it has received any notice of the occurrence of such nonpayment. The Agent
shall (subject to Section 9.06) take such action hereunder with respect to
such Default or Event of Default as shall be directed by the Required
Banks, PROVIDED that, unless and until the Agent shall have received such
directions, the Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default or Event
of Default as it shall deem advisable in the best interests of the Banks.
SECTION 7.04. RIGHTS OF AGENT AND ITS AFFILIATES AS A BANK.
With respect to the Loans made by the Agent and any Affiliate of the Agent,
Wachovia in its capacity as a Bank hereunder and any Affiliate of the Agent
or such Affiliate in its capacity as a Bank hereunder shall have the same
rights and powers hereunder as any other Bank and may exercise the same as
though Wachovia were not acting as the Agent, and the term "Bank" or
"Banks" shall, unless the context otherwise indicates, include Wachovia in
its individual capacity and any Affiliate of the Agent in its individual
capacity. The Agent and any Affiliate of the Agent may (without having to
account therefor to any Bank) accept deposits from, lend money to and
generally engage in any kind of banking, trust or other business with the
General Partner or the Borrower (and any of the Borrower's Affiliates) as
if Wachovia were not acting as the Agent, and the Agent and any Affiliate
of the Agent may accept fees and other consideration from the Borrower (in
addition to any agency fees and arrangement fees heretofore agreed to
between the Borrower and the Agent) for services in connection with this
Agreement or any other Loan Document or otherwise without having to account
for the same to the Banks.
SECTION 7.05. INDEMNIFICATION. Each Bank severally agrees
to indemnify the Agent and the Documentation Agent, to the extent the Agent
and the Documentation Agent shall not have been reimbursed by the Borrower,
ratably in accordance with its Commitment, for any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses (including, without limitation, counsel fees and disbursements) or
disbursements of any kind and nature whatsoever which may be imposed on,
incurred by or asserted against the Agent or the Documentation Agent in any
way relating to or arising out of this Agreement or any other Loan Document
or any other documents contemplated by or referred to herein or therein or
the transactions contemplated hereby or thereby (excluding, unless an Event
of Default has occurred and is continuing, the normal administrative costs
and expenses incident to the performance of its agency duties hereunder) or
the enforcement of any of the terms hereof or thereof or any such other
documents; PROVIDED that no Bank shall be liable for any of the foregoing
to the extent they arise from the gross negligence or wilful misconduct of
the Agent or the Documentation Agent. If any indemnity furnished to the
Agent or the Documentation Agent for any purpose shall, in the opinion of
the Agent or the Documentation Agent, be insufficient or become impaired,
the Agent or the Documentation Agent may call for additional indemnity and
cease, or not commence, to do the acts indemnified against until such
additional indemnity is furnished.
SECTION 7.06 CONSEQUENTIAL DAMAGES. NEITHER THE AGENT NOR ANY
BANK SHALL BE RESPONSIBLE OR LIABLE TO ANY BANK, THE BORROWER OR ANY OTHER
PERSON OR ENTITY FOR ANY PUNITIVE, EXEMPLARY OR CONSEQUENTIAL DAMAGES WHICH
MAY BE ALLEGED AS A RESULT OF THIS AGREEMENT, THE OTHER LOAN DOCUMENTS OR
ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.
<PAGE>
SECTION 7.07. PAYEE OF NOTE TREATED AS OWNER. The Agent
may deem and treat the payee of any Note as the owner thereof for all
purposes hereof unless and until a written notice of the assignment or
transfer thereof shall have been filed with the Agent and the provisions of
Section 9.08(c) have been satisfied. Any requests, authority or consent of
any Person who at the time of making such request or giving such authority
or consent is the holder of any Note shall be conclusive and binding on
any subsequent holder, transferee or assignee of that Note or of any Note
or Notes issued in exchange therefor or replacement thereof.
SECTION 7.08. NONRELIANCE ON AGENT AND OTHER BANKS. Each
Bank agrees that it has, independently and without reliance on the Agent or
any other Bank, and based on such documents and information as it has
deemed appropriate, made its own credit analysis of the Borrower and
decision to enter into this Agreement and that it will, independently and
without reliance upon the Agent or any other Bank, and based on such
documents and information as it shall deem appropriate at the time,
continue to make its own analysis and decisions in taking or not taking
action under this Agreement or any of the other Loan Documents. The Agent
shall not be required to keep itself (or any Bank) informed as to the
performance or observance by the Borrower of this Agreement or any of the
other Loan Documents or any other document referred to or provided for
herein or therein or to inspect the properties or books of the Borrower or
any other Person. Except for notices, reports and other documents and
information expressly required to be furnished to the Banks by the Agent
hereunder or under the other Loan Documents, the Agent shall not have any
duty or responsibility to provide any Bank with any credit or other
information concerning the affairs, financial condition or business of the
Borrower or any other Person (or any of their Affiliates) which may come
into the possession of the Agent.
SECTION 7.09. FAILURE TO ACT. Except for action expressly
required of the Agent hereunder or under the other Loan Documents, the
Agent shall in all cases be fully justified in failing or refusing to act
hereunder and thereunder unless it shall receive further assurances to its
satisfaction by the Banks of their indemnification obligations under
Section 7.05 against any and all liability and expense which may be
incurred by the Agent by reason of taking, continuing to take, or failing
to take any such action.
SECTION 7.10. RESIGNATION OR REMOVAL OF AGENT. Subject to
the appointment and acceptance of a successor Agent as provided below, the
Agent may resign at any time by giving notice thereof to the Banks and the
Borrower and the Agent may be removed at any time with or without cause by
the Required Banks. Upon any such resignation or removal, the Required
Banks shall have the right to appoint a successor Agent, subject to the
consent of the Borrower (which shall not be unreasonably withheld or
delayed), except that no such consent shall be required during the
continuance of a Default. If no successor Agent shall have been so
appointed by the Required Banks and shall have accepted such appointment
within 30 days after the retiring Agent's notice of resignation or the
Required Banks' removal of the retiring Agent, then the retiring Agent may,
on behalf of the Banks, appoint a successor Agent, subject to the consent
of the Borrower (which shall not be unreasonably withheld or delayed),
except during the continuance of a Default. Any successor Agent shall be a
bank which has a combined capital and surplus of at least $500,000,000.
Upon the acceptance of any appointment as Agent hereunder by a successor
Agent, such successor Agent shall thereupon succeed to and become vested
with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations
hereunder. After any retiring Agent's resignation or removal hereunder as
Agent, the provisions of this Article VII shall continue in effect for its
benefit in respect of any actions taken or omitted to be taken by it while
it was acting as the Agent hereunder.
SECTION 7.11. DOCUMENTATION AGENT. The Documentation
Agent, it its capacity as such, shall have no duties or responsibilities
under this Agreement or any of the other Loan Documents.
<PAGE>
ARTICLE VIII
CHANGE IN CIRCUMSTANCES; COMPENSATION
SECTION 8.01. BASIS FOR DETERMINING INTEREST RATE
INADEQUATE OR UNFAIR. If on or prior to the first day of any Interest
Period:
(a) the Agent determines that deposits in Dollars (in the
applicable amounts) are not being offered in the relevant market for such
Interest Period, or
(b) the Required Banks advise the Agent that the London
Interbank Offered Rate as determined by the Agent will not adequately and
fairly reflect the cost to such Banks of funding the Euro-Dollar Loans for
such Interest Period,
the Agent shall forthwith give notice thereof to the Borrower and the
Banks, whereupon until the Agent notifies the Borrower that the
circumstances giving rise to such suspension no longer exist, the
obligations of the Banks to make Euro-Dollar Loans specified in such notice
shall be suspended. Unless the Borrower notifies the Agent at least 2
Domestic Business Days before the date of any Borrowing of such Euro-Dollar
Loans for which a Notice of Borrowing has previously been given that it
elects not to borrow on such date, such Borrowing shall instead be made as
a Base Rate Borrowing.
SECTION 8.02. ILLEGALITY. If, after the date hereof, the
adoption of any applicable law, rule or regulation, or any change therein
or any existing or future law, rule or regulation, or any change in the
interpretation or administration thereof by any governmental authority,
central bank or comparable agency charged with the interpretation or
administration thereof (any such agency being referred to as an "Authority"
and any such event being referred to as a "Change of Law"), or compliance
by any Bank (or its Lending Office) with any request or directive (whether
or not having the force of law) of any Authority shall make it unlawful or
impossible for any Bank (or its Lending Office) to make, maintain or fund
its Euro-Dollar Loans and such Bank shall so notify the Agent, the Agent
shall forthwith give notice thereof to the other Banks and the Borrower,
whereupon until such Bank notifies the Borrower and the Agent that the
circumstances giving rise to such suspension no longer exist, the
obligation of such Bank to make Euro-Dollar Loans shall be suspended.
Before giving any notice to the Agent pursuant to this Section, such Bank
shall designate a different Lending Office if such designation will avoid
the need for giving such notice and will not, in the judgment of such Bank,
be otherwise disadvantageous to such Bank. If such Bank shall determine
that it may not lawfully continue to maintain and fund any of its
outstanding Euro-Dollar Loans to maturity and shall so specify in such
notice, the Borrower shall immediately prepay in full the then outstanding
principal amount of each Euro-Dollar Loan of such Bank, together with
accrued interest thereon and any amount due such Bank pursuant to Section
8.05(a). Concurrently with prepaying each such Euro-Dollar Loan, the
Borrower shall borrow a Base Rate Loan in an equal principal amount from
such Bank (on which interest and principal shall be payable
contemporaneously with the related Euro-Dollar Loans of the other Banks),
and such Bank shall make such a Base Rate Loan.
SECTION 8.03. INCREASED COST AND REDUCED RETURN. (a) If
after the date hereof, a Change of Law or compliance by any Bank (or its
Lending Office) with any request or directive (whether or not having the
force of law) of any Authority:
<PAGE>
(i) shall impose, modify or deem applicable any reserve,
special deposit or similar requirement (including, without limitation, any
such requirement imposed by the Board of Governors of the Federal Reserve
System, but excluding with respect to any Euro-Dollar Loan any such
requirement included in an applicable Euro-Dollar Reserve Percentage)
against assets of, deposits with or for the account of, or credit extended
by, any Bank (or its Lending Office); or
(ii) shall impose on any Bank (or its Lending Office) or on the
United States market for certificates of deposit or the London interbank
market any other condition affecting its Fixed Rate Loans, its Notes or its
obligation to make Fixed Rate Loans;
and the result of any of the foregoing is to increase the cost to such Bank
(or its Lending Office) of making or maintaining any Loan, or to reduce the
amount of any sum received or receivable by such Bank (or its Lending
Office) under this Agreement or under its Notes with respect thereto, by an
amount deemed by such Bank to be material, then, within 15 days after
demand by such Bank (with a copy to the Agent), the Borrower shall pay to
such Bank such additional amount or amounts as will compensate such Bank
for such increased cost or reduction.
(b) If any Bank shall have determined that after the date
hereof the adoption of any applicable law, rule or regulation regarding
capital adequacy, or any change therein, or any change in the
interpretation or administration thereof, or compliance by any Bank (or its
Lending Office) with any request or directive regarding capital adequacy
(whether or not having the force of law) of any Authority, has or would
have the effect of reducing the rate of return on such Bank's capital as a
consequence of its obligations hereunder to a level below that which such
Bank could have achieved but for such adoption, change or compliance
(taking into consideration such Bank's policies with respect to capital
adequacy) by an amount deemed by such Bank to be material, then from time
to time, within 15 days after demand by such Bank, the Borrower shall pay
to such Bank such additional amount or amounts as will compensate such Bank
for such reduction.
(c) Each Bank will promptly notify the Borrower and the Agent
of any event of which it has knowledge, occurring after the date hereof,
which will entitle such Bank to compensation pursuant to this Section and
will designate a different Lending Office if such designation will avoid
the need for, or reduce the amount of, such compensation and will not, in
the judgment of such Bank, be otherwise disadvantageous to such Bank. A
certificate of any Bank claiming compensation under this Section and
setting forth the additional amount or amounts to be paid to it hereunder
shall be conclusive in the absence of manifest error. In determining such
amount, such Bank may use any reasonable averaging and attribution methods.
(d) The provisions of this Section 8.03 shall be applicable
with respect to any Participant, Assignee or other Transferee, and any
calculations required by such provisions shall be made based upon the
circumstances of such Participant, Assignee or other Transferee.
(e) No Bank, Assignee or other Transferee will charge
Borrower for increased costs or reduced returns pursuant to Sections
8.03(a) or (b) at a higher rate than such Bank, Assignee or other
Transferee charges its other similarly situated borrowers or customers.
SECTION 8.04. BASE RATE LOANS SUBSTITUTED FOR EURO-DOLLAR
LOANS. If (i) the obligation of any Bank to make or maintain any Euro-
Dollar Loans has been suspended pursuant to Section 8.02 or (ii) any Bank
has demanded compensation under Section 8.03, and the Borrower shall, by at
least 5 Euro-Dollar Business Days' prior notice to such Bank through the
Agent, have elected that the provisions of this Section shall apply to such
Bank, then, unless and until such Bank notifies the Borrower that the
circumstances giving rise to such suspension or demand for compensation no
longer apply:
<PAGE>
(a) all Loans which would otherwise be made by such Bank as
Euro-Dollar Loans shall be made instead as Base Rate Loans (in all cases
interest and principal on such Loans shall be payable contemporaneously
with the related Euro-Dollar Loans of the other Banks), and
(b) after each of its Euro-Dollar Loans has been repaid, all
payments of principal which would otherwise be applied to repay such Euro-
Dollar Loans shall be applied to repay its Base Rate Loans instead.
SECTION 8.05. COMPENSATION. Upon the request of any Bank,
delivered to the Borrower and the Agent, the Borrower shall pay to such
Bank such amount or amounts as shall compensate such Bank for any loss,
cost or expense incurred by such Bank as a result of:
(a) any payment or prepayment (pursuant to Section 2.10,
2.11, 6.01, 8.02 or otherwise) of a Fixed Rate Loan on a date other than
the last day of an Interest Period for such Loan; or
(b) any failure by the Borrower to prepay a Fixed Rate Loan
on the date for such prepayment specified in the relevant notice of
prepayment hereunder; or
(c) any failure by the Borrower to borrow a Fixed Rate Loan
on the date for the Fixed Rate Borrowing of which such Fixed Rate Loan is a
part specified in the applicable Notice of Borrowing delivered pursuant to
Section 2.02 or notification of acceptance of Money Market Quotes pursuant
to Section 2.03(e);
such compensation to include, without limitation, an amount equal to the
excess, if any, of (x) the amount of interest which would have accrued on
the amount so paid or prepaid or not prepaid or borrowed for the period
from the date of such payment, prepayment or failure to prepay or borrow to
the last day of the then current Interest Period for such Fixed Rate Loan
(or, in the case of a failure to prepay or borrow, the Interest Period for
such Fixed Rate Loan which would have commenced on the date of such failure
to prepay or borrow) at the applicable rate of interest for such Fixed Rate
Loan provided for herein over (y) the amount of interest (as reasonably
determined by such Bank) such Bank would have paid on deposits in Dollars
of comparable amounts having terms comparable to such period placed with it
by leading banks in the London interbank market (if such Fixed Rate Loan is
a Euro-Dollar Loan).
ARTICLE IX
MISCELLANEOUS
SECTION 9.01. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including
telecopier or similar writing, except as hereafter expressly provided) and
shall be given to such party at its address or telecopier number set forth
on the signature pages hereof or such other address or telecopier number as
such party may hereafter specify for the purpose by notice to each other
party. Each such notice, request or other communication shall be effective
(i) if given by telecopier, when such telecopy is transmitted to the
telecopier number specified in this Section and the confirmation is
received, (ii) if given by mail, 72 hours after such communication is
deposited in the mails with first class postage prepaid, addressed as
aforesaid or (iii) if given by any other means, when delivered at the
address specified in this Section; PROVIDED that notices to the Agent under
Article II or Article VIII shall not be effective until received.
Notwithstanding the foregoing, notices pursuant to Section 6.01 and service
of process pursuant to Section 9.16(d) shall not be given by telecopier.
<PAGE>
SECTION 9.02. NO WAIVERS. No failure or delay by the Agent
or any Bank in exercising any right, power or privilege hereunder or under
any Note or other Loan Document shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.
SECTION 9.03. EXPENSES; DOCUMENTARY TAXES. The Borrower
shall pay (i) all out-of-pocket expenses of the Agent, including fees and
disbursements of special counsel for the Agent, in connection with the
preparation of this Agreement and the other Loan Documents, any waiver or
consent hereunder or thereunder or any amendment hereof or thereof or any
Default or alleged Default hereunder or thereunder and (ii) if a Default
occurs, all out-of-pocket expenses incurred by the Agent and the Banks,
including fees and disbursements of counsel, in connection with such
Default and collection and other enforcement proceedings resulting
therefrom, including out-of-pocket expenses incurred in enforcing this
Agreement and the other Loan Documents. The Borrower shall indemnify the
Agent and each Bank against any transfer taxes, documentary taxes,
assessments or charges made by any Authority by reason of the execution and
delivery of this Agreement or the other Loan Documents.
SECTION 9.04. INDEMNIFICATION. The Borrower shall
indemnify the Agent, the Documentation Agent, the Banks and each Affiliate
thereof and their respective directors, officers, employees and agents
from, and hold each of them harmless against, any and all losses,
liabilities, claims or damages to which any of them may become subject,
insofar as such losses, liabilities, claims or damages arise out of or
result from any actual or proposed use by the Borrower of the proceeds of
any extension of credit by any Bank hereunder or breach by the Borrower of
this Agreement or any other Loan Document or from any investigation,
litigation (including, without limitation, any actions taken by the Agent
or any of the Banks to enforce this Agreement or any of the other Loan
Documents) or other proceeding (including, without limitation, any
threatened investigation or proceeding) relating to the foregoing, and the
Borrower shall reimburse the Agent the Documentation Agent and each Bank,
and each Affiliate thereof and their respective directors, officers,
employees and agents, upon demand for any expenses (including, without
limitation, legal fees) incurred in connection with any such investigation
or proceeding; but excluding any such losses, liabilities, claims, damages
or expenses incurred by reason of the gross negligence or wilful misconduct
of the Person to be indemnified.
SECTION 9.05. SETOFF; SHARING OF SETOFFS. (a) The Borrower
hereby grants to the Agent and each Bank (and Wachovia, as to the Swing
Loans) a lien for all indebtedness and obligations owing to them from the
Borrower upon all deposits or deposit accounts, of any kind, or any
interest in any deposits or deposit accounts thereof, now or hereafter
pledged, mortgaged, transferred or assigned to the Agent or any such Bank
or otherwise in the possession or control of the Agent or any such Bank for
any purpose for the account or benefit of the Borrower and including any
balance of any deposit account or of any credit of the Borrower with the
Agent or any such Bank, whether now existing or hereafter established
hereby authorizing the Agent and each Bank at any time or times with or
without prior notice to apply such balances or any part thereof to such of
the indebtedness and obligations owing by the Borrower to the Banks and/or
the Agent then past due and in such amounts as they may elect, and whether
or not the collateral, if any, or the responsibility of other Persons
primarily, secondarily or otherwise liable may be deemed adequate. For the
purposes of this paragraph, all remittances and property shall be deemed to
be in the possession of the Agent or any such Bank as soon as the same may
be put in transit to it by mail or carrier or by other bailee.
<PAGE>
(b) Each Bank agrees that if it shall, by exercising any
right of setoff or counterclaim or resort to collateral security or
otherwise, receive payment of a proportion of the aggregate amount of
principal and interest owing with respect to the Note held by it which is
greater than the proportion received by any other Bank in respect of the
aggregate amount of all principal and interest owing with respect to the
Note held by such other Bank, the Bank receiving such proportionately
greater payment shall purchase such participations in the Notes held by the
other Banks owing to such other Banks, and such other adjustments shall be
made, as may be required so that all such payments of principal and
interest with respect to the Notes held by the Banks owing to such other
Banks shall be shared by the Banks pro rata; PROVIDED that (i) nothing in
this Section shall impair the right of any Bank to exercise any right of
setoff or counterclaim it may have and to apply the amount subject to such
exercise to the payment of indebtedness of the Borrower other than its
indebtedness under the Notes, and (ii) if all or any portion of such
payment received by the purchasing Bank is thereafter recovered from such
purchasing Bank, such purchase from each other Bank shall be rescinded and
such other Bank shall repay to the purchasing Bank the purchase price of
such participation to the extent of such recovery together with an amount
equal to such other Bank's ratable share (according to the proportion of
(x) the amount of such other Bank's required repayment to (y) the total
amount so recovered from the purchasing Bank) of any interest or other
amount paid or payable by the purchasing Bank in respect of the total
amount so recovered. The Borrower agrees, to the fullest extent it may
effectively do so under applicable law, that any holder of a participation
in a Note, whether or not acquired pursuant to the foregoing arrangements,
may exercise rights of setoff or counterclaim and other rights with respect
to such participation as fully as if such holder of a participation were a
direct creditor of the Borrower in the amount of such participation.
SECTION 9.06. AMENDMENTS AND WAIVERS. (a) Any provision of
this Agreement, the Notes or any other Loan Documents may be amended or
waived if, but only if, such amendment or waiver is in writing and is
signed by the Borrower and the Required Banks (and, if the rights or duties
of the Agent are affected thereby, by the Agent); PROVIDED that, no such
amendment or waiver shall, unless signed by all Banks, (i) change the
Commitment of any Bank or subject any Bank to any additional obligation,
(ii) change the principal of or rate of interest on any Loan or any fees
(other than fees payable to the Agent) hereunder, (iii) change the date
fixed for any payment of principal of or interest on any Loan or any fees
hereunder, (iv) change the amount of principal, interest or fees due on any
date fixed for the payment thereof, (v) change the percentage of the
Commitments or of the aggregate unpaid principal amount of the Notes, or
the percentage of Banks, which shall be required for the Banks or any of
them to take any action under this Section or any other provision of this
Agreement, (vi) change the manner of application of any payments made under
this Agreement or the Notes, (vii) release or substitute all or any
substantial part of the collateral (if any) held as security for the Loans,
or (viii) release any Guarantee given to support payment of the Loans, or
(ix) change the definition of "Borrowing Base".
(b) The Borrower will not solicit, request or negotiate for
or with respect to any proposed waiver or amendment of any of the
provisions of this Agreement except through the Agent, unless each Bank
shall be informed thereof by the Borrower and shall be afforded an
opportunity of considering the same and shall be supplied by the Borrower
with sufficient information to enable it to make an informed decision with
respect thereto. Executed or true and correct copies of any waiver or
consent effected pursuant to the provisions of this Agreement shall be
delivered by the Borrower to each Bank forthwith following the date on
which the same shall have been executed and delivered by the requisite
percentage of Banks. The Borrower will not, directly or indirectly, pay or
<PAGE>
cause to be paid any remuneration, whether by way of supplemental or
additional interest, fee or otherwise, to any Bank (in its capacity as
such) as consideration for or as an inducement to the entering into by such
Bank of any waiver or amendment of any of the terms and provisions of this
Agreement unless such remuneration is concurrently paid, on the same terms,
ratably to all such Banks.
SECTION 9.07. NO MARGIN STOCK COLLATERAL. Each of the
Banks represents to the Agent and each of the other Banks that it in good
faith is not, directly or indirectly (by negative pledge or otherwise),
relying upon any Margin Stock as collateral in the extension or maintenance
of the credit provided for in this Agreement.
SECTION 9.08. SUCCESSORS AND ASSIGNS. (a) The provisions
of this Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns; PROVIDED that
the Borrower may not assign or otherwise transfer any of its rights under
this Agreement.
(b) Any Bank may at any time sell to one or more Persons
(each a "Participant") participating interests in any Loan owing to such
Bank, any Note held by such Bank, any Commitment hereunder or any other
interest of such Bank hereunder. In the event of any such sale by a Bank
of a participating interest to a Participant, such Bank's obligations under
this Agreement shall remain unchanged, such Bank shall remain solely
responsible for the performance thereof, such Bank shall remain the holder
of any such Note for all purposes under this Agreement, and the Borrower
and the Agent shall continue to deal solely and directly with such Bank in
connection with such Bank's rights and obligations under this Agreement.
In no event shall a Bank that sells a participation be obligated to the
Participant to take or refrain from taking any action hereunder except that
such Bank may agree that it will not (except as provided below), without
the consent of the Participant, agree to (i) the change of any date fixed
for the payment of principal of or interest on the related loan or loans,
(ii) the change of the amount of any principal, interest or fees due on any
date fixed for the payment thereof with respect to the related loan or
loans, (iii) the change of the principal of the related loan or loans, (iv)
any change in the rate at which either interest is payable thereon or (if
the Participant is entitled to any part thereof) fee is payable hereunder
from the rate at which the Participant is entitled to receive interest or
fee (as the case may be) in respect of such participation, (v) the release
or substitution of all or any substantial part of the collateral (if any)
held as security for the Loans, or (vi) the release of any Guarantee given
to support payment of the Loans. Each Bank selling a participating
interest in any Loan, Note, Commitment or other interest under this
Agreement, other than a Money Market Loan or Money Market Note or
participating interest therein, shall, within 10 Domestic Business Days of
such sale, provide the Borrower and the Agent with written notification
stating that such sale has occurred and identifying the Participant and the
interest purchased by such Participant. The Borrower agrees that each
Participant shall be entitled to the benefits of Article VIII with respect
to its participation in Loans outstanding from time to time.
(c) Any Bank may at any time assign to one or more banks or
financial institutions (each an "Assignee") all or a proportionate part of
its rights and obligations under this Agreement, the Notes and the other
Loan Documents, and such Assignee shall assume all such rights and
obligations, pursuant to an Assignment and Acceptance, executed by such
Assignee, such transferor Bank and the Agent (and, in the case of an
Assignee that is not then a Bank, subject to clause (iii) below, by the
Borrower); PROVIDED that (i) no interest may be sold by a Bank pursuant to
this paragraph (c) unless the Assignee shall agree to assume ratably
equivalent portions of the transferor Bank's Commitment, (ii) if a Bank is
assigning only a portion of its Commitment, then, the amount of the
Commitment being assigned (determined as of the effective date of the
assignment) shall be in an amount not less than $5,000,000, (iii) except
during the continuance of a Default, no interest may be sold by a Bank
pursuant to this paragraph (c) to any Assignee that is not then a Bank (or
<PAGE>
an Affiliate of a Bank) without the consent of the Borrower and the Agent,
which consent shall not be unreasonably withheld, and (iv) a Bank may not
have more than 3 Assignees that are not then Banks at any one time. Upon
(A) execution of the Assignment and Acceptance by such transferor Bank,
such Assignee, the Agent and (if applicable) the Borrower, (B) delivery of
an executed copy of the Assignment and Acceptance to the Borrower and the
Agent, (C) payment by such Assignee to such transferor Bank of an amount
equal to the purchase price agreed between such transferor Bank and such
Assignee, and (D) payment of a processing and recordation fee of $2,500 to
the Agent, such Assignee shall for all purposes be a Bank party to this
Agreement and shall have all the rights and obligations of a Bank under
this Agreement to the same extent as if it were an original party hereto
with a Commitment as set forth in such instrument of assumption, and the
transferor Bank shall be released from its obligations hereunder to a
corresponding extent, and no further consent or action by the Borrower, the
Banks or the Agent shall be required. Upon the consummation of any
transfer to an Assignee pursuant to this paragraph (c), the transferor
Bank, the Agent and the Borrower shall make appropriate arrangements so
that, if required, a new Note is issued to each of such Assignee and such
transferor Bank.
(d) Subject to the provisions of Section 9.09, the Borrower
authorizes each Bank to disclose to any Participant, Assignee or other
transferee (each a "Transferee") and any prospective Transferee any and all
financial information in such Bank's possession concerning the Borrower
which has been delivered to such Bank by the Borrower pursuant to this
Agreement or which has been delivered to such Bank by the Borrower in
connection with such Bank's credit evaluation prior to entering into this
Agreement.
(e) No Transferee shall be entitled to receive any greater
payment under Section 8.03 than the transferor Bank would have been
entitled to receive with respect to the rights transferred, unless such
transfer is made with the Borrower's prior written consent or by reason of
the provisions of Section 8.02 or 8.03 requiring such Bank to designate a
different Lending Office under certain circumstances or at a time when the
circumstances giving rise to such greater payment did not exist.
(f) Anything in this Section 9.08 to the contrary
notwithstanding, any Bank may assign and pledge all or any portion of the
Loans and/or obligations owing to it to any Federal Reserve Bank or the
United States Treasury as collateral security pursuant to Regulation A of
the Board of Governors of the Federal Reserve System and any Operating
Circular issued by such Federal Reserve Bank, PROVIDED that any payment in
respect of such assigned Loans and/or obligations made by the Borrower to
the assigning and/or pledging Bank in accordance with the terms of this
Agreement shall satisfy the Borrower's obligations hereunder in respect of
such assigned Loans and/or obligations to the extent of such payment. No
such assignment shall release the assigning and/or pledging Bank from its
obligations hereunder.
SECTION 9.09. CONFIDENTIALITY. Each Bank agrees to
exercise commercially reasonable efforts to keep any information delivered
or made available by the Borrower to it which is clearly indicated to be
confidential information, confidential from anyone other than persons
employed or retained by such Bank who are or are expected to become engaged
in evaluating, approving, structuring or administering the Loans; PROVIDED
that nothing herein shall prevent any Bank from disclosing such information
(i) to any other Bank, (ii) upon the order of any court or administrative
agency, (iii) upon the request or demand of any regulatory agency or
authority having jurisdiction over such Bank, (iv) which has been publicly
disclosed, (v) to the extent reasonably required in connection with any
litigation to which the Agent, any Bank or their respective Affiliates may
be a party, (vi) to the extent reasonably required in connection with the
exercise of any remedy hereunder, (vii) to such Bank's legal counsel and
independent auditors and (viii) to any actual or proposed Participant,
Assignee or other Transferee of all or part of its rights hereunder which
<PAGE>
has agreed in writing to be bound by the provisions of this Section 9.09;
PROVIDED that should disclosure of any such confidential information be
required by virtue of clause (ii) of the immediately preceding sentence, to
the extent permitted by law, any relevant Bank shall promptly notify the
Borrower of same so as to allow the Borrower to seek a protective order or
to take any other appropriate action; PROVIDED, FURTHER, THAT, no Bank
shall be required to delay compliance with any directive to disclose any
such information so as to allow the Borrower to effect any such action.
SECTION 9.10. REPRESENTATION BY BANKS. Each Bank hereby
represents that it is a commercial lender or financial institution which
makes loans in the ordinary course of its business and that it will make
its Loans hereunder for its own account in the ordinary course of such
business; PROVIDED that, subject to Section 9.08, the disposition of the
Note or Notes held by that Bank shall at all times be within its exclusive
control.
SECTION 9.11. OBLIGATIONS SEVERAL. The obligations of each
Bank hereunder are several, and no Bank shall be responsible for the
obligations or commitment of any other Bank hereunder. Nothing contained
in this Agreement and no action taken by the Banks pursuant hereto shall be
deemed to constitute the Banks to be a partnership, an association, a joint
venture or any other kind of entity. The amounts payable at any time
hereunder to each Bank shall be a separate and independent debt, and each
Bank shall be entitled to protect and enforce its rights arising out of
this Agreement or any other Loan Document and it shall not be necessary for
any other Bank to be joined as an additional party in any proceeding for
such purpose.
SECTION 9.12. GEORGIA LAW. This Agreement and each Note
shall be construed in accordance with and governed by the law of the State
of Georgia.
SECTION 9.13. SEVERABILITY. In case any one or more of the
provisions contained in this Agreement, the Notes or any of the other Loan
Documents should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein and therein shall not in any way be affected or impaired thereby and
shall be enforced to the greatest extent permitted by law.
SECTION 9.14. INTEREST. In no event shall the amount of
interest, and all charges, amounts or fees contracted for, charged or
collected pursuant to this Agreement, the Notes or the other Loan Documents
and deemed to be interest under applicable law (collectively, "Interest")
exceed the highest rate of interest allowed by applicable law (the "Maximum
Rate"), and in the event any such payment is inadvertently received by any
Bank, then the excess sum (the "Excess") shall be credited as a payment of
principal, unless the Borrower shall notify such Bank in writing that it
elects to have the Excess returned forthwith. It is the express intent
hereof that the Borrower not pay and the Banks not receive, directly or
indirectly in any manner whatsoever, interest in excess of that which may
legally be paid by the Borrower under applicable law. The right to
accelerate maturity of any of the Loans does not include the right to
accelerate any interest that has not otherwise accrued on the date of such
acceleration, and the Agent and the Banks do not intend to collect any
unearned interest in the event of any such acceleration. All monies paid
to the Agent or the Banks hereunder or under any of the Notes or the other
Loan Documents, whether at maturity or by prepayment, shall be subject to
rebate of unearned interest as and to the extent required by applicable
law. By the execution of this Agreement, the Borrower covenants, to the
fullest extent permitted by law, that (i) the credit or return of any
Excess shall constitute the acceptance by the Borrower of such Excess, and
(ii) the Borrower shall not seek or pursue any other remedy, legal or
equitable, against the Agent or any Bank, based in whole or in part upon
contracting for charging or receiving any Interest in excess of the Maximum
<PAGE>
Rate. For the purpose of determining whether or not any Excess has been
contracted for, charged or received by the Agent or any Bank, all interest
at any time contracted for, charged or received from the Borrower in
connection with this Agreement, the Notes or any of the other Loan
Documents shall, to the extent permitted by applicable law, be amortized,
prorated, allocated and spread in equal parts throughout the full term of
the Commitments. The Borrower, the Agent and each Bank shall, to the
maximum extent permitted under applicable law, (i) characterize any non-
principal payment as an expense, fee or premium rather than as Interest and
(ii) exclude voluntary prepayments and the effects thereof. The provisions
of this Section shall be deemed to be incorporated into each Note and each
of the other Loan Documents (whether or not any provision of this Section
is referred to therein). All such Loan Documents and communications
relating to any Interest owed by the Borrower and all figures set forth
therein shall, for the sole purpose of computing the extent of obligations
hereunder and under the Notes and the other Loan Documents be automatically
recomputed by the Borrower, and by any court considering the same, to give
effect to the adjustments or credits required by this Section.
SECTION 9.15. INTERPRETATION. No provision of this
Agreement or any of the other Loan Documents shall be construed against or
interpreted to the disadvantage of any party hereto by any court or other
governmental or judicial authority by reason of such party having or being
deemed to have structured or dictated such provision.
SECTION 9.16. WAIVER OF JURY TRIAL; CONSENT TO
JURISDICTION. The Borrower (a) and each of the Banks and the Agent
irrevocably waives, to the fullest extent permitted by law, any and all
right to trial by jury in any legal proceeding arising out of this
Agreement, any of the other Loan Documents, or any of the transactions
contemplated hereby or thereby, (b) submits to the nonexclusive personal
jurisdiction in the State of Georgia, the courts thereof and the United
States District Courts sitting therein, for the enforcement of this
Agreement, the Notes and the other Loan Documents, (c) waives any and all
personal rights under the law of any jurisdiction to object on any basis
(including, without limitation, inconvenience of forum) to jurisdiction or
venue within the State of Georgia for the purpose of litigation to enforce
this Agreement, the Notes or the other Loan Documents, and (d) agrees that
service of process may be made upon it in the manner prescribed in Section
9.01 for the giving of notice to the Borrower. Nothing herein contained,
however, shall prevent the Agent from bringing any action or exercising any
rights against any security and against the Borrower personally, and
against any assets of the Borrower, within any other state or jurisdiction.
SECTION 9.17. COUNTERPARTS. This Agreement may be signed
in any number of counterparts, each of which shall be an original, with the
same effect as if the signatures thereto and hereto were upon the same
instrument.
SECTION 9.18. SOURCE OF FUNDS -- ERISA. Each of the Banks
hereby severally (and not jointly) represents to the Borrower that no part
of the funds to be used by such Bank to fund the Loans hereunder from time
to time constitutes (i) assets allocated to any separate account maintained
by such Bank in which any employee benefit plan (or its related trust) has
any interest nor (ii) any other assets of any employee benefit plan. As
used in this Section, the terms "employee benefit plan" and "separate
account" shall have the respective meanings assigned to such terms in
Section 3 of ERISA.
SECTION 9.19. EXCULPATION. Neither the General Partner nor
any other partner of the Borrower, nor any officer or trustee of any of
them, shall have any obligation or liability for payment of the Loans, and
holders of the Notes will have no claims or other recourse against the
General Partner or any other partner of the Borrower or any officer or
trustee of any of them, or against any assets of the General Partner or any
<PAGE>
other partner of the Borrower or any officer or trustee of any of them, in
respect of the Loans; and the holders of the Notes shall not have any right
to enforce any obligations of a partner to make a contribution to the
Borrower under any provision of the Agreement of Limited Partnership of the
Borrower. Neither the General Partner nor any other partner of the
Borrower nor any officer or trustee of any of them nor any of their
respective assets shall be subject to any lien, levy, execution or any
other enforcement procedure relating directly or indirectly to the Loans or
any obligations thereunder; PROVIDED, HOWEVER, that in the event of a
dissolution of the Borrower, any assets of the Borrower that are received
by the General Partner in such dissolution shall be subject to the claims
of the holders of the Notes for the enforcement of payment thereof.
[Signatures are contained on the following pages.]
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed, under seal, by their respective authorized
officers as of the day and year first above written.
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware Limited Partnership
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
By: /S/ ROBERT J. CHAPMAN
------------------------------
Robert J. Chapman
Title: Chief Financial Officer
AMLI Residential Properties, L.P.
125 South Wacker Dr., Suite 3100
Chicago, Illinois 60606
Attention: President
Telecopier number: 312-443-0909
Confirmation number: 312-443-1477
<PAGE>
COMMITMENTS
$60,000,000 WACHOVIA BANK, N.A.,
as Agent and as a Bank (SEAL)
By: /S/ CATHY CASEY
------------------------------
Cathy Casey
Title: Senior Vice President
LENDING OFFICE
Wachovia Bank, N.A.
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Telecopier number: 404-332-4005
Confirmation number: 404-332-6971
<PAGE>
$35,000,000 THE FIRST NATIONAL BANK OF CHICAGO
as Documentation Agent and as a Bank
(SEAL)
By: /S/ GREGORY A. GILBERT
------------------------------
Gregory A. Gilbert
Title: Vice President
Lending Office
The First National Bank of Chicago
Suite 0151, 14th Floor
One First National Plaza
Chicago, Illinois 60670
Attention: Gregory A. Gilbert
Telecopier number: 312-732-1117
Confirmation number: 312-732-2107
<PAGE>
$35,000,000 DRESDNER BANK AG, NEW
YORK AND GRAND CAYMAN BRANCHES
as Co-Agent and a Bank (SEAL)
By: /S/ JOHN W. SWEENEY
--------------------------------
John W. Sweeney
Title: Assistant Vice President
By: /S/ BEVERLY G. CASON
--------------------------------
Beverly G. Cason
Title: Vice President
LENDING OFFICE
Dresdner Bank, AG,
New York and Grand Cayman Branches
190 South LaSalle Street
Suite 2700
Chicago, Illinois 60603
Attention: Maureen Slentz
Telecopier number: 312-444-1305
Confirmation number: 312-444-1316
<PAGE>
$25,000,000 HARRIS TRUST AND SAVINGS BANK (SEAL)
By: /S/ GREGORY M. BINS
------------------------------
Gregory M. Bins
Title: Vice President
Lending Office
Harris Trust and Savings Bank
111 West Monroe, 5th Floor West
Chicago, Illinois 60603
Attention: Gregory M. Bins
Telecopier number: 312-461-2968
Confirmation number: 312-461-2203
<PAGE>
$25,000,000 LASALLE NATIONAL BANK (SEAL)
By: /S/ JOHN C. HEIN
------------------------------
John C. Hein
Title: First Vice President
Lending Office
LaSalle National Bank
135 South LaSalle Street
Suite 1225
Chicago, Illinois 60603
Attention: John C. Hein
Telecopier number: 312-904-6467
Confirmation number: 312-904-8620
<PAGE>
$20,000,000 PNC BANK, N.A. (SEAL)
By: /S/ MICHAEL SMITH
------------------------------
Michael Smith
Title: Vice President
Lending Office
PNC Bank, N.A.
1-PNC Plaza
249 5th Avenue
Pittsburgh, Pennsylvania 15222-2707
Attention: Michael Smith
Telecopier number: 412-762-6500
Confirmation number: 412-768-9135
- --------------------
TOTAL COMMITMENTS:
$200,000,000
<PAGE>
EXHIBIT A-1
----------
SYNDICATED LOAN NOTE
Atlanta, Georgia
July __, 1998
For value received, AMLI RESIDENTIAL PROPERTIES, L.P., a
Delaware limited partnership (the "Borrower"), promises to pay to the order
of __________________________________________________, a
____________________ (the "Bank"), for the account of its Lending Office,
the principal sum of ___________________________________ AND NO/100 DOLLARS
($__________), or such lesser amount as shall equal the unpaid principal
amount of each Syndicated Loan made by the Bank to the Borrower pursuant to
the Credit Agreement referred to below, on the dates and in the amounts
provided in the Credit Agreement. The Borrower promises to pay interest on
the unpaid principal amount of this Note on the dates and at the rate or
rates provided for in the Credit Agreement. Interest on any overdue
principal of and, to the extent permitted by law, overdue interest on the
principal amount hereof shall bear interest at the Default Rate, as
provided for in the Credit Agreement. All such payments of principal and
interest shall be made in lawful money of the United States in Federal or
other immediately available funds at the office of Wachovia Bank, N.A., 191
Peachtree Street, N.E., Atlanta, Georgia 30303-1757, or such other address
as may be specified from time to time pursuant to the Credit Agreement.
All Syndicated Loans made by the Bank, the respective
maturities thereof, the interest rates from time to time applicable
thereto, and all repayments of the principal thereof shall be recorded by
the Bank and, prior to any transfer hereof, endorsed by the Bank on the
schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; PROVIDED that the failure of the Bank to make any
such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This Note is one of the Syndicated Loan Notes referred to in
the Amended and Restated Credit Agreement dated as of July __, 1998 among
the Borrower, the Banks listed on the signature pages thereof, Wachovia
Bank, N.A., as Agent and The First National Bank of Chicago, as
Documentation Agent (as the same may be amended and modified from time to
time, the "Credit Agreement"). Terms defined in the Credit Agreement are
used herein with the same meanings. Reference is made to the Credit
Agreement for provisions for the optional and mandatory prepayment and the
repayment hereof and the acceleration of the maturity hereof, as well as
the obligation of the Borrower to pay all costs of collection, including
reasonable attorneys fees, in the event this Note is collected by law or
through an attorney at law.
The Borrower hereby waives presentment, demand, protest, notice
of demand, protest and nonpayment and any other notice required by law
relative hereto, except to the extent as otherwise may be expressly
provided for in the Credit Agreement.
This Note and the rights and claims of the Bank hereunder are
subject in all respects to the provisions of Section 9.19 of the Credit
Agreement, which contains exculpation provisions with respect to the
liability of the general and limited partners of Borrower with respect to
the liabilities of the Borrower hereunder.
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this Note to be
duly executed, under seal, by its duly authorized officer as of the day and
year first above written.
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware limited partnership
(SEAL)
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust,
its General Partner
By:
------------------------------
Title:
<PAGE>
SYNDICATED LOAN NOTE (cont'd)
SYNDICATED LOANS AND PAYMENTS OF PRINCIPAL
Base Rate Amount Amount of
or Euro- of Principal Maturity Notation
Date Dollar Loan Loan Repaid Date Made By
<PAGE>
EXHIBIT A-2
-----------
SWING LOAN NOTE
Atlanta, Georgia
July __, 1998
For value received, AMLI RESIDENTIAL PROPERTIES, L.P., a
Delaware limited partnership (the "Borrower"), promises to pay to the order
of WACHOVIA BANK, N.A. (the "Bank"), for the account of its Lending Office,
the principal sum of FIVE MILLION AND NO/100 DOLLARS ($5,000,000), or such
lesser amount as shall equal the unpaid principal amount of each Swing Loan
made by the Bank to the Borrower pursuant to the Credit Agreement referred
to below, on the dates and in the amounts provided in the Credit Agreement.
The Borrower promises to pay interest on the unpaid principal amount of
this Swing Loan Note at the rate provided for Base Rate Loans or
Transaction Rate Loans, as the case may be, on the dates provided for in
the Credit Agreement. Interest on any overdue principal of and, to the
extent permitted by law, overdue interest on the principal amount hereof
shall bear interest at the Default Rate, as provided for in the Credit
Agreement. All such payments of principal and interest shall be made in
lawful money of the United States in Federal or other immediately available
funds at the office of Wachovia Bank, N.A., 191 Peachtree Street, N.E.,
Atlanta, Georgia 30303-1757, or such other address as may be specified from
time to time pursuant to the Credit Agreement.
All Swing Loans made by the Bank, the respective maturities
thereof, the interest rates from time to time applicable thereto, and all
repayments of the principal thereof shall be recorded by the Bank and,
prior to any transfer hereof, endorsed by the Bank on the schedule attached
hereto, or on a continuation of such schedule attached to and made a part
hereof; PROVIDED that the failure of the Bank to make any such recordation
or endorsement shall not affect the obligations of the Borrower hereunder
or under the Credit Agreement.
This Note is one of the Swing Loan Notes referred to in the
Amended and Restated Credit Agreement dated as of July __, 1998 among the
Borrower, the Banks listed on the signature pages thereof, Wachovia Bank,
N.A., as Agent and The First National Bank of Chicago, as Documentation
Agent (as the same may be amended and modified from time to time, the
"Credit Agreement"). Terms defined in the Credit Agreement are used herein
with the same meanings. Reference is made to the Credit Agreement for
provisions for the optional and mandatory prepayment and the repayment
hereof and the acceleration of the maturity hereof, as well as the
obligation of the Borrower to pay all costs of collection, including
reasonable attorneys fees, in the event this Note is collected by law or
through an attorney at law.
The Borrower hereby waives presentment, demand, protest, notice
of demand, protest and nonpayment and any other notice required by law
relative hereto, except to the extent as otherwise may be expressly
provided for in the Credit Agreement.
This Note and the rights and claims of the Bank hereunder are
subject in all respects to the provisions of Section 9.19 of the Credit
Agreement, which contains exculpation provisions with respect to the
liability of the general and limited partners of Borrower with respect to
the liabilities of the Borrower hereunder.
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this Note to be
duly executed, under seal, by its duly authorized officer as of the day and
year first above written.
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware limited partnership
(SEAL)
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust,
its General Partner
By:
------------------------------
Title:
<PAGE>
SWING LOAN NOTE (cont'd)
SWING LOANS AND PAYMENTS OF PRINCIPAL
Base Rate Amount Amount of
or Trans- of Principal Maturity Notation
Date action Rate Loan Repaid Date Made By
Loan
<PAGE>
EXHIBIT A-3
-----------
MONEY MARKET LOAN NOTE
As of July ___, 1998
For value received, AMLI RESIDENTIAL PROPERTIES, L.P., a
Delaware Limited Partnership (the "Borrower"), promises to pay to the order
of ______________________________, a _______________ (the "Bank"), for the
account of its Lending Office, the principal sum of ONE HUNDRED MILLION AND
NO/100 DOLLARS ($100,000,000), or such lesser amount as shall equal the
unpaid principal amount of each Money Market Loan made by the Bank to the
Borrower pursuant to the Credit Agreement referred to below, on the dates
and in the amounts provided in the Credit Agreement. The Borrower promises
to pay interest on the unpaid principal amount of this Money Market Loan
Note on the dates and at the rate or rates provided for in the Credit
Agreement referred to below. Interest on any overdue principal of and, to
the extent permitted by law, overdue interest on the principal amount
hereof shall bear interest at the Default Rate, as provided for in the
Credit Agreement. All such payments of principal and interest shall be
made in lawful money of the United States in Federal or other immediately
available funds at the office of Wachovia Bank, N.A., 191 Peachtree Street,
N.E., Atlanta, Georgia 30303-1757, or such other address as may be
specified from time to time pursuant to the Credit Agreement.
All Money Market Loans made by the Bank, the respective
maturities thereof, the interest rates from time to time applicable
thereto, and all repayments of the principal thereof shall be recorded by
the Bank and, prior to any transfer hereof, endorsed by the Bank on the
schedule attached hereto, or on a continuation of such schedule attached to
and made a part hereof; PROVIDED that the failure of the Bank to make any
such recordation or endorsement shall not affect the obligations of the
Borrower hereunder or under the Credit Agreement.
This Money Market Loan Note is one of the Money Market Loan
Notes referred to in the Amended and Restated Credit Agreement dated as of
July ___, 1998 among the Borrower, the Banks listed on the signature pages
thereof, Wachovia Bank, N.A., as Agent (as the same may be amended and
modified from time to time, the "Credit Agreement"). Terms defined in the
Credit Agreement are used herein with the same meanings. Reference is made
to the Credit Agreement for provisions for the optional and mandatory
prepayment and the repayment hereof and the acceleration of the maturity
hereof, as well as the obligation of the Borrower to pay all costs of
collection, including reasonable attorneys fees, in the event this Money
Market Loan Note is collected by law or through an attorney at law.
The Borrower hereby waives presentment, demand, protest, notice
of demand, protest and nonpayment and any other notice required by law
relative hereto, except to the extent as otherwise may be expressly
provided for in the Credit Agreement.
This Note and the rights and claims of the Bank hereunder are
subject in all respects to the provisions of Section 9.19 of the Credit
Agreement, which contains exculpation provisions with respect to the
liability of the general and limited partners of Borrower with respect to
the liabilities of the Borrower hereunder.
<PAGE>
IN WITNESS WHEREOF, the Borrower has caused this Money Market
Loan Note to be duly executed, under seal, by its duly authorized officer
as of the day and year first above written.
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware Limited Partnership
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
By:
------------------------------
Title:
<PAGE>
Money Market Loan Note (cont'd)
MONEY MARKET LOANS AND PAYMENTS OF PRINCIPAL
Amount Amount of Stated
Interest of Principal Maturity Notation
Date Rate Loan Repaid Date Made By
<PAGE>
EXHIBIT B
---------
OPINION OF
COUNSEL FOR THE BORROWER
------------------------
[Dated as provided in
Section 3.01 of the Credit Agreement]
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attn: Syndications Group
Dear Sirs:
We have acted as counsel for AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware limited partnership (the "Borrower") in connection with the
Amended and Restated Credit Agreement (the "Credit Agreement") dated as of
July __, 1998, among the Borrower, the banks listed on the signature pages
thereof, Wachovia Bank, N.A., as Agent and The First National Bank of
Chicago, as Documentation Agent. Terms defined in the Credit Agreement are
used herein as therein defined.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, corporate records, trust
records, partnership records, certificates of public officials and other
instruments and have conducted such other investigations of fact and law as
we have deemed necessary or advisable for purposes of this opinion. We
have assumed for purposes of our opinions set forth below that the
execution and delivery of the Credit Agreement by each Bank and by the
Agent have been duly authorized by each Bank and by the Agent.
Upon the basis of the foregoing, we are of the opinion that:
1. The Borrower is a limited partnership duly created,
validly existing and in good standing under the laws of Delaware and has
all partnership powers required to carry on its business as now conducted.
2. The execution, delivery and performance by the Borrower
of the Credit Agreement the Notes (i) are within its partnership powers,
(ii) have been duly authorized by all necessary partnership action, (iii)
require no action by or in respect of, or filing with, any governmental
body, agency or official, (iv) do not contravene, or constitute a default
under, any provision of applicable law or regulation or of the certificate
of limited partnership or partnership agreement of the Borrower or of the
declaration of trust of the General Partner, or of any agreement, judgment,
injunction, order, decree or other instrument which to our knowledge is
binding upon the Borrower and (v) to our knowledge, except as provided in
the Credit Agreement, do not result in the creation or imposition of any
Lien on any asset of the Borrower or any of its Subsidiaries.
3. The Credit Agreement constitutes a valid and binding
agreement of the Borrower, enforceable against it in accordance with its
terms, and the Notes constitute valid and binding obligations of the
Borrower, enforceable in accordance with its terms, except as such
enforceability may be limited by: (i) bankruptcy, insolvency or similar
laws affecting the enforcement of creditors' rights generally and (ii)
general principles of equity.
<PAGE>
4. To our knowledge, there is no action, suit or proceeding
pending, or threatened, against or affecting the Borrower before any court
or arbitrator or any governmental body, agency or official in which there
is a reasonable possibility of an adverse decision which could materially
adversely affect the business, consolidated financial position or
consolidated results of operations of the Borrower or which in any manner
questions the validity or enforceability of the Credit Agreement or any
Note.
5. The Borrower is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
6. The Borrower is not a "holding company", or a "subsidiary
company" of a "holding company", or an "affiliate" of a "holding company"
or of a "subsidiary company" of a "holding company", as such terms are
defined in the Public Utility Holding Company Act of 1935, as amended.
We are qualified to practice in the State of Illinois and do not
purport to be experts on any laws other than the laws of the United States,
the State of Illinois and the revised Uniform Limited Partnership Act as in
effect in the State of Delaware, and this opinion is rendered only with
respect to such laws. For purposes of the opinion contained in Paragraph 3
above, we have assumed that the laws of the State of Georgia are the same
as those of the State of Illinois. We have made no independent
investigation of the laws of any other jurisdiction.
This opinion is delivered to you in connection with the transaction
referenced above and may only be relied upon by you, any Assignee,
Participant or other Transferee under the Credit Agreement, and Jones, Day,
Reavis & Pogue without our prior written consent.
Very truly yours,
<PAGE>
EXHIBIT C
---------
OPINION OF
JONES, DAY, REAVIS & POGUE, SPECIAL COUNSEL
FOR THE AGENT
-------------------------------------------
[Dated as provided in
Section 3.01 of the Credit Agreement]
To the Banks and the Agent
Referred to Below
c/o Wachovia Bank, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-175
Attention: Syndications Group
Dear Sirs:
We have participated in the preparation of the Amended and
Restated Credit Agreement (the "Credit Agreement") dated as of July __,
1998, among Amli Residential Properties, L.P., a Delaware limited
partnership (the "Borrower"), the banks listed on the signature pages
thereof (the "Banks"), Wachovia Bank, N.A., as Agent (the "Agent") and The
First National Bank of Chicago, as Documentation Agent, and have acted as
special counsel for the Agent for the purpose of rendering this opinion
pursuant to Section 3.01(d) of the Credit Agreement. Terms defined in the
Credit Agreement are used herein as therein defined.
This opinion letter is limited by, and is in accordance with,
the January 1, 1992 edition of the Interpretive Standards applicable to
Legal Opinions to Third Parties in Corporate Transactions adopted by the
Legal Opinion Committee of the Corporate and Banking Law Section of the
State Bar of Georgia which Interpretive Standards are incorporated herein
by this reference.
We have examined originals or copies, certified or otherwise
identified to our satisfaction, of such documents, records, certificates of
public officials and other instruments and have conducted such other
investigations of fact and law as we have deemed necessary or advisable for
purposes of this opinion.
Upon the basis of the foregoing, and assuming the due
authorization, execution and delivery of the Credit Agreement and each of
the Notes by or on behalf of the Borrower, we are of the opinion that the
Credit Agreement constitutes a valid and binding agreement of the Borrower,
each Note constitutes valid and binding obligations of the Borrower,
enforceable in accordance with its terms except as: (i) the enforceability
thereof may be affected by bankruptcy, insolvency, reorganization,
fraudulent conveyance, voidable preference, moratorium or similar laws
applicable to creditors' rights or the collection of debtors' obligations
generally; (ii) rights of acceleration and the availability of equitable
remedies may be limited by equitable principles of general applicability;
and (iii) the enforceability of certain of the remedial, waiver and other
provisions of the Credit Agreement and the Notes may be further limited by
the laws of the State of Georgia; PROVIDED that such additional laws do
not, in our opinion, substantially interfere with the practical realization
of the benefits expressed in the Credit Agreement or the Notes, except for
the economic consequences of any procedural delay which may result from
such laws.
<PAGE>
In giving the foregoing opinion, we express no opinion as to the
effect (if any) of any law of any jurisdiction except the State of Georgia.
We express no opinion as to the effect of the compliance or noncompliance
of the Agent or any of the Banks with any state or federal laws or
regulations applicable to the Agent or any of the Banks by reason of the
legal or regulatory status or the nature of the business of the Agent or
any of the Banks.
This opinion is delivered to you in connection with the transaction
referenced above and may only be relied upon by you and any Assignee,
Participant or other Transferee under the Credit Agreement without our
prior written consent.
Very truly yours,
<PAGE>
EXHIBIT D
---------
ASSIGNMENT AND ACCEPTANCE
-------------------------
Dated __________, __________
Reference is made to the Amended and Restated Credit Agreement
dated as of July __, 1998 (together with all amendments and modifications
thereto, the "Credit Agreement") among Amli Residential Properties, L.P., a
Delaware limited partnership (the "Borrower"), the Banks (as defined in the
Credit Agreement), Wachovia Bank, N.A., as Agent and The First National
Bank of Chicago, as Documentation Agent. Terms defined in the Credit
Agreement are used herein with the same meaning.
________________________________________ (the "Assignor") and
______________________________ (the "Assignee") agree as follows:
1. The Assignor hereby sells and assigns to the Assignee,
without recourse to the Assignor, and the Assignee hereby purchases and
assumes from the Assignor, a _____% interest in and to all of the
Assignor's rights and obligations under the Amended and Restated Credit
Agreement as of the Effective Date (as defined below) (including, without
limitation, a _____% interest (which on the Effective Date hereof is $_____
) in the Assignor's Commitment and a _____ interest (which on
the Effective Date hereof is $___________ ) in the Syndicated Loans [and
Swing Loans] [and Money Market Loans] owing to the Assignor and a _____%
interest in the Syndicated Loan Note [and Swing Loan Note] [and Money
Market Loan Note] held by the Assignor (which on the Effective Date hereof
is $__________) [and $__________, respectively].
2. The Assignor (i) makes no representation or warranty and
assumes no responsibility with respect to any statements, warranties or
representations made in or in connection with the Credit Agreement or the
execution, legality, validity, enforceability, genuineness, sufficiency or
value of the Credit Agreement or any other instrument or document furnished
pursuant thereto, other than that it is the legal and beneficial owner of
the interest being assigned by it hereunder, that such interest is free and
clear of any adverse claim and that as of the date hereof its Commitment
(without giving effect to assignments thereof which have not yet become
effective) is $__________ and the aggregate outstanding principal amount of
Syndicated Loans [and Swing Loans] [and Money Market Loans] owing to it
(without giving effect to assignments thereof which have not yet become
effective) is $__________ [and $__________, respectively]; (ii) makes no
representation or warranty and assumes no responsibility with respect to
the financial condition of the Borrower or the performance or observance by
the Borrower of any of its obligations under the Credit Agreement or any
other instrument or document furnished pursuant thereto; and (iii) attaches
the Note[s] referred to in Paragraph 1 above and requests that the Agent
exchange such Note[s] [for a new Syndicated Loan Note dated _________, ____
in the principal amount of $____________ payable to the order of the
Assignee, a new Swing Loan Note dated ___________, ____ in the principal
amount of $____________ payable to the order of the Assignee, [and for new
Notes as follows: a (i) Syndicated Loan Note dated ___________, ____ in
the principal amount of $___________ payable to the order of the Assignor,
(ii) Swing Loan Note dated ____________, ____ in the principal amount of
$__________ payable to the order of the Assignor], and (iii) Money Market
Loan Note dated ____________, ____ in the principal amount of $__________
payable to the order of the Assignor].
<PAGE>
3. The Assignee (i) confirms that it has received a copy of
the Credit Agreement, together with copies of the financial statements
referred to in Section 4.04(a) thereof (or any more recent financial
statements of the Borrower delivered pursuant to Section 5.01(a) or (b)
thereof) and such other documents and information as it has deemed
appropriate to make its own credit analysis and decision to enter into this
Assignment and Acceptance; (ii) agrees that it will, independently and
without reliance upon the Agent, the Assignor or any other Bank and based
on such documents and information as it shall deem appropriate at the time,
continue to make its own credit decisions in taking or not taking action
under the Credit Agreement; (iii) confirms that it is a bank or financial
institution; (iv) appoints and authorizes the Agent to take such action as
agent on its behalf and to exercise such powers under the Credit Agreement
as are delegated to the Agent by the terms thereof, together with such
powers as are reasonably incidental thereto; (v) agrees that it will
perform in accordance with their terms all of the obligations which by the
terms of the Credit Agreement are required to be performed by it as a Bank;
(vi) specifies as its Lending Office (and address for notices) the office
set forth beneath its name on the signature pages hereof, (vii) represents
and warrants that the execution, delivery and performance of this
Assignment and Acceptance are within its powers and have been duly
authorized by all necessary action, (viii) makes the representation and
warranty contained in Section 9.18 of the Credit Agreement, and (ix)
attaches the forms prescribed by the Internal Revenue Service of the United
States certifying as to the Assignee's status for purposes of determining
exemption from United States withholding taxes with respect to all payments
to be made to the Assignee under the Credit Agreement and the Notes.
4. The Effective Date for this Assignment and Acceptance
shall be __________, , (the "Effective Date"). Following
the execution of this Assignment and Acceptance, it will be delivered to
the Agent for execution and acceptance by the Agent and to the Borrower for
execution by the Borrower.
5. Upon such execution and acceptance by the Agent, and
execution by the Borrower, if required by the Credit Agreement, from and
after the Effective Date, (i) the Assignee shall be a party to the Credit
Agreement and, to the extent rights and obligations have been transferred
to it by this Assignment and Acceptance, have the rights and obligations of
a Bank thereunder and (ii) the Assignor shall, to the extent its rights and
obligations have been transferred to the Assignee by this Assignment and
Acceptance, relinquish its rights (other than under Sections 8.03, 9.03 and
9.04 of the Credit Agreement) and be released from its obligations under
the Credit Agreement, except as expressly provided therein.
<PAGE>
6. Upon such execution and acceptance by the Agent, and
execution by the Borrower, if required by the Credit Agreement, from and
after the Effective Date, the Agent shall make all payments in respect of
the interest assigned hereby to the Assignee. The Assignor and Assignee
shall make all appropriate adjustments in payments for periods prior to
such acceptance by the Agent directly between themselves.
7. This Assignment and Acceptance shall be governed by, and
construed in accordance with, the laws of the State of Georgia.
[NAME OF ASSIGNOR]
By:
------------------------------
Title:
[NAME OF ASSIGNEE]
By:
------------------------------
Title:
Lending Office:
[Address]
WACHOVIA BANK, N.A.,
As Agent
By:
------------------------------
Title:
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware limited partnership
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
[If required by the Credit Agreement]
By:
------------------------------
Title:
<PAGE>
EXHIBIT E
---------
NOTICE OF BORROWING
-------------------
,
Wachovia Bank, N.A., as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: Amended and Restated Credit Agreement (as amended and modified
from time to time, the "Credit Agreement") dated as of July __, 1998 by and
among Amli Residential Properties, L.P., the Banks from time to time
parties thereto, Wachovia Bank, N.A., as Agent and The First National Bank
of Chicago, as Documentation Agent.
Gentlemen:
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings attributable thereto in the Credit Agreement.
This Notice of Borrowing is delivered to you pursuant to Section 2.02
of the Credit Agreement.
The Borrower hereby requests a [Euro-Dollar Borrowing] [Syndicated
Loan Borrowing at a Base Rate] [Swing Loan Borrowing] in the aggregate
principal amount of $ (1) to be made on , ,
and for interest to accrue thereon at the rate established by the Credit
Agreement for [Euro-Dollar Loans] [Base Rate Loans]. The duration of the
Interest Period with respect thereto shall be [1 month] [2 months] [3
months] [6 months] [30 days].
The amount available to be borrowed under Section 2.01 of the Credit
Agreement, net of amounts to be paid with the proceeds of this Borrowing,
is as follows:
(a) Aggregate amount of Commitments $
(b) Borrowing Base per most recent
Borrowing Base Certificate $
(c) Principal amount outstanding under
Syndicated Loans $
(d) Principal amount outstanding under
Swing Loans $
(e) Principal amount outstanding under
Money Market Loans $
(f) Amount available to be borrowed
(lesser of (a) or (b), less sum
of (c), (d) and (e) $
(1) Not to exceed the amount available to be borrowed as set forth in the
next paragraph.
<PAGE>
The Borrower has caused this Notice of Borrowing to be executed and
delivered by its duly authorized officer this day of ,
.
AMLI RESIDENTIAL PROPERTIES, L.P.
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
By:
------------------------------
Title:
<PAGE>
EXHIBIT F
---------
COMPLIANCE CERTIFICATE
----------------------
Reference is made to the Amended and Restated Credit Agreement
dated as of July __, 1998 (as modified and supplemented and in effect from
time to time, the "Credit Agreement") by and among Amli Residential
Properties, L.P., the Banks from time to time parties thereto, Wachovia
Bank, N.A., as Agent and The First National Bank of Chicago, as
Documentation Agent. Capitalized terms used herein shall have the meanings
ascribed thereto in the Credit Agreement; all amounts shown herein, unless
expressly set forth to the contrary, shall be without duplication.
Pursuant to Section 5.01(c) of the Amended and Restated Credit
Agreement, , the duly authorized of
the Borrower, hereby (i) certifies to the Agent and the Banks that the
information contained in the Compliance Check List attached hereto is true,
accurate and complete as of , , and that no Default is in
existence on and as of the date hereof and (ii) restates and reaffirms that
the representations and warranties contained in Article IV of the Credit
Agreement are true on and as of the date hereof as though restated on and
as of this date.
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware limited partnership
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
By:
------------------------------
Its:
<PAGE>
COMPLIANCE CHECK LIST
AMLI RESIDENTIAL PROPERTIES, L.P.
,
1. Consolidations, Mergers and Sales of Assets (Section 5.05)
Neither the Borrower, the General Partner nor any of the Guarantors
will consolidate or merge with or into, or acquire all or substantially all
of the assets or stock of any other Person, or sell, lease or otherwise
transfer all or any substantial part of its assets to, any other Person,
PROVIDED that:
(i) the Borrower may merge with another Person if (x) such
Person was organized under the laws of the United States of America or one
of its states, (y) the Borrower is the limited partnership surviving such
merger and (z) immediately after giving effect to such merger, no Default
shall have occurred and be continuing;
(ii) Guarantors may merge with one another, and the
Guarantors may sell, lease or otherwise transfer assets to the Borrower;
(iii) the foregoing limitation on the acquisition of all
or substantially all the assets or stock of another Person shall not
prohibit, during any Fiscal Quarter, the acquisition of all or
substantially all of the assets or stock of another Person unless the
aggregate assets or stock acquired in a single acquisition or series of
related acquisitions of all or substantially all of the assets or stock of
another Person by the Borrower, the General Partner and the Guarantors
during such Fiscal Quarter constituted more than 20% of Gross Asset Value
at the end of the most recent Fiscal Quarter immediately preceding such
Fiscal Quarter; and
(iv) the foregoing limitation on the sale, lease or other
transfer of assets shall not prohibit, during any Fiscal Quarter, a
transfer of assets (in a single transaction or in a series of related
transactions) unless the aggregate assets to be so transferred, when
combined with all other assets transferred, by the Borrower, the General
Partner and the Guarantors during such Fiscal Quarter and the immediately
preceding 3 Fiscal Quarters, constituted more than 20% of Gross Asset Value
at the end of the most recent Fiscal Year immediately preceding such Fiscal
Quarter.
In the case of any Guarantor which transfers substantially all
of its assets pursuant to clause (iv) of the preceding sentence, and in the
case of any Guarantor the stock of which is being sold and with respect to
which clause (iv) would have been satisfied if the transaction had been a
sale of assets of such Guarantor, such Guarantor may dissolve and shall be
entitled to obtain from the Agent a written release from the Guaranty,
PROVIDED that it can demonstrate to the reasonable satisfaction of the
Agent that (A) it has repaid in full all Debt owed to the Borrower or any
other Guarantor and (B) such sale was for cash and in the case of an asset
transfer, the net cash proceeds received in connection therewith are being
distributed to the Borrower as part of such dissolution, and upon obtaining
such written release, it shall no longer be a Guarantor for any purpose
hereunder.
<PAGE>
(a) Aggregate amount of assets or stock
acquired in a single acquisition or
series of related acquisitions
during Fiscal Quarter just ended $
(b) Gross Asset Value Schedule 1 $
(c) 20% of (b) $
Limitation: (a) may not exceed (c)
(d) Aggregate amount of assets sold
during Fiscal Quarter just
ended $
(e) Aggregate amount of assets sold
during 3 prior Fiscal Quarters $
(f) Sum of (d) and (e) $
Limitation: (f) may not exceed (c)
2. Restricted Payments (Section 5.15) (2)
The Borrower's Restricted Payments in any calendar year shall not
exceed 95% of Funds From Operations for such period, unless (i) the
Borrower must pay out an amount in excess of 95% of Funds From Operations
to permit the General Partner to preserve its status as a real estate
investment trust under the applicable provision of the Code, or (ii) the
Borrower declares one or more capital gains dividends within such calendar
year (in which event the amount of additional Restricted Payments that may
be made as a result of such declaration as provided in this clause (ii)
shall not exceed the greater of (A) the income tax liability of the
Borrower's partners with respect thereto and (B) $1,500,000). In the event
that the Borrower receives an Investment Grade Debt Rating and so long as
that rating (or a better rating) is affirmed during each year, the
Borrower's Restricted Payments in any calendar year will be limited to 100%
of Funds from Operations for such calendar year with the same exceptions
contained in clauses (i) and (ii) of this Section 5.15.
(a) Restricted Payments for current
calendar year $
(b) Funds From Operations for current
calendar year Schedule 2 $
Maximum Restricted Payments
Generally: [95%] [100%] of (b) $
Additional Restricted Payments permitted
by clause (i) $
Additional Restricted Payments permitted
by clause (ii), not to exceed greater
of partners' income tax liability
and $1,500,000 $
Calendar year distributions to date $
(2) Include this paragraph 2 and Schedule 2 only with the first Complaince
Certificate furnished after the end of each Fiscal Year.
<PAGE>
3. Loans or Advances (Section 5.16)
Neither the Borrower, the General Partner nor any of the Guarantors
shall make loans or advances to any Person except as permitted by Section
5.17 and except:
(i) deposits required by government agencies or public
utilities;
(ii) loans or advances from the Borrower to a Guarantor or
from a Guarantor to the Borrower or another Guarantor;
(iii) loans and advances made to (A) Amli Institutional
Advisors, Inc. as part of its initial capital structure in the amount of
$500,000, and (B) Amli Management Company as part of its initial capital
structure in the amount of $3,000,000;
(iv) loans or advances to employees, officers and
directors not exceeding $1,000,000 in the aggregate principal amount
outstanding at any time, in each case made in the ordinary course of
business, but excluding loans and advances described in clause (v);
(v) loans and advances to employees, officers and
directors to enable them to buy partnership units in the Borrower or stock
in the General Partner which are secured by a pledge of such stock, so long
as the aggregate amount of all such loans does not exceed $5,000,000;
(vi) working capital loans and advances to Amli
Residential Construction, Inc. for use in the ordinary course of business
and consistent with past practices, so long as the aggregate principal
amount outstanding at any time for all such loans and advances is not in
excess of $6,000,000;
(vii) loans and advances to Co-Investment Partnerships in
an aggregate amount which, together with Investments in Co-Investment
Partnerships, does not exceed (i) so long as the Borrower has no Investment
Grade Debt Rating, 15% of Gross Asset Value and (ii) while the Borrower has
an Investment Grade Debt Rating, 20% of Gross Asset Value; and/or
(viii) other loans and advances by the Borrower, the
General Partner and the Guarantors to any Person other than a Co-Investment
Partnership which (x) are evidenced by notes (and, if requested by the
Agent, acting at the direction of the Required Banks, with such notes,
together with any related mortgage, have been assigned to and pledged with
the Agent, for the benefit of itself and the Banks, as security for the
payment of all obligations of the Borrower to the Agent and the Banks
hereunder) and (y) are in an amount which, together with Investments
permitted by clause (vii) of Section 5.17, do not exceed 5% of Gross Asset
Value as of the end of the most recent Fiscal Quarter;
PROVIDED that after giving effect to the making of any loans, advances
or deposits permitted by this Section, no Default shall be in existence or
be created thereby.
(a) Loans and advances to employees, officers
and directors, excluding stock
purchase loans $
Limitation $1,000,000
(b) Loans and advances to employees, officers
and directors for the purchase of, and
secured by, stock in the General
Partner $
Limitation $5,000,000
(c) working capital loans to Amli Residential
Construction, Inc. for construction
in progress $
Limitation $6,000,000
(d) loans and advances to Co-Investment
Partnerships $
(e) See line (d) and "Limitation" of paragraph
10 below
(f) other loans and advances evidenced by
notes (and, if required, pledged with
Agent) and not permitted by clauses
(i) through (vii) $
(g) See line (e) and "Limitation" of paragraph 4 below
4. Investments (Section 5.17)
Neither the Borrower, the General Partner nor any of the Guarantors
shall make Investments after the Closing Date in any Person except as
permitted by Section 5.16 and except Investments in:
(i) direct obligations of the United States Government
maturing within one year;
(ii) certificates of deposit issued by a commercial bank
whose credit is satisfactory to the Agent;
(iii) commercial paper rated A1 or the equivalent thereof
by S&P or P1 or the equivalent thereof by Moody's and in either case
maturing within 6 months after the date of acquisition;
(iv) tender bonds the payment of the principal of and
interest on which is fully supported by a letter of credit issued by a
United States bank whose long-term certificates of deposit are rated at
least A or the equivalent thereof by S&P and A or the equivalent thereof by
Moody's;
(v) Investments consisting of the acquisition of all or
substantially all of the assets or stock of another Person permitted by
Section 5.05(iii);
(vi) Investments in Co-Investment Partnerships permitted
by Section 5.26; and/or
(vii) other Investments by the Borrower, the General
Partner and the Guarantors, other than in Co-Investment Partnerships, in an
amount which, together with loans and advances permitted by clause (viii)
of Section 5.16, do not exceed 5% of Gross Asset Value as of the end of the
most recent Fiscal Quarter;
PROVIDED, however, immediately after giving effect to the making of
any Investment, no Default shall have occurred and be continuing.
(a) Line (f) of paragraph 3 above $
(b) Other Investments not permitted by
clauses (i) through (vi) $
(c) Sum of (a) and (b) $
<PAGE>
(d) Gross Asset Value Schedule 1 $
(e) 5% of (d) $
Limitation: (c) may not exceed (e)
5. Ratio of Consolidated Total Liabilities to Undepreciated Book
Asset Value (Section 5.20)
The ratio of Total Consolidated Liabilities to Undepreciated Book
Asset Value shall at all times be equal to or less than 0.60 to 1.0.
(a) Total Consolidated Liabilities
Schedule 3 $
(b) original cost of all real estate
assets plus the cost of capital
improvements thereon, without deduction
for accumulated depreciation and
amortization incurred in connection
therewith $_________
(c) book value of all other tangible assets
determined in accordance with GAAP $
(d) Approved Collateral Value $_________
(e) Undepreciated Book Asset Value (sum of
(b) plus (c) minus (d)) $_________
(f) Actual ratio of (a) to (e) to 1.0
Maximum ratio 0.60 to 1.0
6. Ratio of Total Secured Debt to Gross Asset Value (Section
5.21)
The ratio of Total Secured Debt to Gross Asset Value shall at all
times be equal to or less than 0.45 to 1.0.
(a) Total Secured Debt Schedule 4 $
(b) Gross Asset Value Schedule 1 $
(c) Actual ratio of (a) to (b) to 1.0
Maximum ratio 0.45 to 1.0
7. Ratio of EBITDA to Consolidated Interest Expense (Section
5.22)
The ratio of EBITDA to Consolidated Interest Expense for the Fiscal
Quarter just ended will not be less than 2.0 to 1.00, calculated at the end
of each Fiscal Quarter.
(a) EBITDA Schedule 5 $
(b) Consolidated Interest Expense $
(c) ratio of (a) to (b) to 1.0
Minimum ratio 2.0 to 1.0
<PAGE>
8. Ratio of Unencumbered Assets to Unsecured Funded Debt
(Section 5.23)
The ratio of Unencumbered Assets to Unsecured Funded Debt shall at all
times be equal to or greater than 1.75 to 1.00.
(a) Net Operating Income from each
Property not subject to a Mortgage
Schedule 6 $
(b) (a) divided by 0.09 $
(c) 4 times (b) $
(d) book value of all Construction in
Progress and unimproved land not subject
to a Mortgage $
(e) sum of (c) and (d) $
(f) Unsecured Funded Debt Schedule 7 $
(g) Actual ratio of (e) to (f) to 1.0
Minimum ratio 1.75 to 1.0
9. Ratio of Unsecured Net Operating Income to Unsecured Interest
Expense (Section 5.24)
The ratio of Unsecured Net Operating Income to Unsecured Interest
Expense shall at all times be equal to or greater than 2.0 to 1.0.
(a) Unsecured Net Operating Income Schedule 6 $
(b) Unsecured Interest Expense (3) $
(c) Actual ratio of (a) to (b) to 1.0
Minimum ratio 2.0 to 1.0
(3) Include only Consolidated Interest Expense attributable to Unsecured
Funded Debt.
<PAGE>
10. Co-Investment Partnerships Depreciated Book Value (Section
5.26)
The amount of the depreciated book value set forth on the line item
designated as "Investments in Partnerships" on the Borrower's consolidated
balance sheet, together with the aggregate amount of loans and advances to
Co-Investment Partnerships permitted by clause (vii) of Section 5.16, shall
not at any time exceed (i) so long as the Borrower does not have an
Investment Grade Debt Rating, 15% of Gross Asset Value and (ii) while the
Borrower has an Investment Grade Debt Rating, 20% of Gross Asset Value.
(a) depreciated book value of Co-Investment
Partnerships per Borrower's consolidated
balance sheet $
(b) Gross Asset Value Schedule 1 $
Limitation (a) may not exceed [15%] [20%] of (b)
<PAGE>
Schedule 1
Gross Asset Value
-----------------
(a) Net Operating Income for the 3 month
period ending on the last day of the
month just ended prior to the date of
determination, from each Property owned
for three months or longer $
(b) (a) divided by 0.09 $
(c) 4 times (b) $
(d) book value of Construction in Progress
and unimproved land $
(e) acquisition cost of improved Property
owned by Borrower for less than three
months $
(f) sum of unrestricted cash on deposit and
market value of Investments permitted
under Section 5.17(i), (ii), (iii)
and (iv) $
(g) sum of all earnings before interest and
taxes of the Service Companies
for the 3 month period ending
on the last day of the month just ended $
(h) 4 times (g) $
(i) (h) divided by 0.15 $
GROSS ASSET VALUE (sum of (c), (d), (e)
(f) and (i)) $
<PAGE>
Schedule 2
Funds From Operations
(for Fiscal Year just ended) (4)
Net income $
plus depreciation and amortization
of real estate assets $
plus net loss/(gain) on real estate
sales $
plus loss/(gains) on extraordinary
items $
plus depreciation of real estate
assets held in unconsolidated
entities $
FUNDS FROM OPERATIONS $
(4) The calculation is subject to change as required by NAREIT, subject to
the provisions of Seciton 1.02.
<PAGE>
Schedule 3
Total Consolidated Liabilities
(a) Consolidated Liabilities $
(b) Debt Guaranteed by Borrower or any
Guarantor $
(c) face amount of all letters of credit
issued for the account of the Borrower
or any Guarantor $
(d) Approved Collateral Value $
TOTAL CONSOLIDATED LIABILITIES (sum of (a)
through (c) minus (d) $
<PAGE>
Schedule 4
Total Secured Debt (5)
INTEREST FINAL
RATE(6) MATURITY TOTAL
Money Borrowed
$
$
$
$
$
Total Money Borrowed $
Deferred Purchase Price (7)
$
$
$
$
Total Deferred Purchase Price $
Capital Leases in which Borrower is the Tenant
$
$
Total Capital Leases $
Letter of Credit Reimbursement
Obligations
$
$
Total Letter of Credit
Reimbursement Obligations $
Guarantees of Debt of Persons other than Borrower and Guarantors
$
$
$
$
$
TOTAL SECURED DEBT $
(5) Include only Debt secured by a Mortage.
(6) If rate is fixed, insert contract rate. If rate is floating, state
that.
(7) Exclude trade accounts payable in the ordinary course of business.
<PAGE>
Schedule 5
EBITDA
quarter
consolidated net income $
less extraordinary gains ($ )
plus extraordinary losses $
plus Consolidated Interest Expense $
plus taxes on income $
plus depreciation and amortization $
plus other non-cash charges $
Total $
EBITDA $
<PAGE>
Schedule 6
Unsecured Net Operating Income and Net Operating Income (8)
(for Fiscal Quarter just ended)
quarter
(a) Property revenues $
(b) Property expenses
(excluding depreciation, amortization
and debt service and actual management
fees) $
(c) UNSECURED NET OPERATING INCOME (sum of
(a) less (b) $
(d) management fee (4% of gross
rental income, excluding
percentage rents and less any
management fees included in (b)) $
(e) capital reserve ($150 per Unit) $
(f) NET OPERATING INCOME (sum of (c)
less (d) less (e) $
(8) Include only Properties not subject to a Mortgage
<PAGE>
Schedule 7
Unsecured Funded Debt (9)
INTEREST FINAL
RATE (10) MATURITY TOTAL
Money Borrowed
$
$
$
$
$
Total Money Borrowed $
Deferred Purchase Price (11)
$
$
$
$
Total Deferred Purchase Price $
Capital Leases in which the Borrower is the tenant
$
$
Total Capital Leases $
Letter of Credit Reimbursement
Obligations
$
$
Total Letter of Credit
Reimbursement Obligations $
Guarantees of Debt of Persons other than Borrower and Guarantors
$
$
$
$
$
(9) Include only Debt not secured by a Mortgage.
(10) If rate is fixed, insert contract rate. If rate is floating, state
that.
(11) Exclude trade accounts payable in the ordinary course of business.
<PAGE>
AMLI RESIDENTIAL PROPERTIES, L.P.
CLOSING CERTIFICATE
Reference is made to the Amended and Restated Credit Agreement (the
"Credit Agreement") dated as of July __, 1998, among Amli Residential
Properties, L.P., the Banks listed therein, Wachovia Bank, N.A., as Agent
and The First National Bank of Chicago, as Documentation Agent.
Capitalized terms used herein have the meanings ascribed thereto in the
Credit Agreement.
Pursuant to Section 3.01(e) of the Credit Agreement,
, the duly authorized executive officer of AMLI Residential
Properties Trust, the General Partner of Amli Residential Properties, L.P.,
hereby certifies to the Agent and the Banks that, to the best of my
knowledge, (i) no Default has occurred and is continuing as of the date
hereof, and (ii) the representations and warranties contained in Article IV
of the Credit Agreement are true on and as of the date hereof.
Certified as July __, 1998.
By:
Printed Name:
[Chairman] [Vice Chairman]
[President] [Treasurer]
<PAGE>
EXHIBIT H-1
AMLI RESIDENTIAL PROPERTIES TRUST
OFFICER'S CERTIFICATE
The undersigned, , the [Chairman]
[Vice Chairman] [President] [Treasurer] of AMLI RESIDENTIAL PROPERTIES
TRUST, general partner of AMLI RESIDENTIAL PROPERTIES L.P., a Delaware
limited partnership (the "Borrower"), hereby certifies that [s]he has been
duly elected, qualified and is acting in such capacity and that, as such,
[s]he is familiar with the facts herein certified and is duly authorized to
certify the same, and hereby further certifies, in connection with the
Credit Agreement dated as of July __, 1998 (as amended from time to time,
the "Credit Agreement") among the Borrower, Wachovia Bank, N.A. as Agent,
The First National Bank of Chicago, as Documentation Agent, and certain
other Banks listed on the signature pages thereof, that:
1. Attached hereto as Exhibit A is a complete and correct copy of
the Declaration of Trust of Amli Residential Properties Trust (the "Trust")
as in full force and effect on the date hereof.
2. Attached hereto as Exhibit B is a complete and correct copy of
the Certificate of Limited Partnership as certified by the Secretary of
State of the State of Delaware, the Borrower's state of creation.
3. Attached hereto as Exhibit C is a complete and correct copy of
the Partnership Agreement of the Borrower as in full force and effect on
the date hereof.
4. The General Partner incorporates herein by reference as fully as
if set forth herein all of the representations and warranties pertaining to
the General Partner contained in Article IV of the Credit Agreement (which
representations and warranties shall be deemed to have been renewed by the
General Partner upon each Borrowing under the Credit Agreement, and the
General Partner will fully comply with those covenants set forth in Article
V of the Credit Agreement pertaining to the General Partner, and the
General Partner incorporates herein by reference as fully as if set forth
herein all of such covenants.
5. As [Chairman] [Vice Chairman] [President] [Treasurer] I have
been duly authorized by all proper and necessary action to execute and
deliver the Credit Agreement and the other Loan Documents (defined in the
Credit Agreement) on behalf of the Trust, as general partner of the
Borrower and (with respect to Paragraph 4 hereof) on behalf of the Trust,
and no consent or approval of any beneficiaries or trustors under the Trust
is required as a condition thereto.
IN WITNESS WHEREOF, the undersigned has hereunto set [his/her] hand as
of July __, 1998.
[Chairman] [Vice Chairman]
[President] [Treasurer]
<PAGE>
EXHIBIT I
BORROWING BASE CERTIFICATE
Reference is made to the Amended and Restated Credit Agreement dated
as of July __, 1998 (as modified and supplemented and in effect from time
to time, the "Credit Agreement") among AMLI Residential Properties, L.P.,
the Banks from time to time parties thereto, Wachovia Bank, N.A., as Agent
and The First National Bank of Chicago, as Documentation Agent.
Capitalized terms used herein shall have the meanings ascribed thereto in
the Credit Agreement.
Pursuant to Section [3.01(h)][5.01(h)] of the Credit Agreement,
, the duly authorized of the Borrower,
hereby (i) certifies to the Agent and the Banks that the calculation of the
Borrowing Base contained in this Borrowing Base Certificate is true,
accurate and complete in all material respects as of , .
The calculation of the Borrowing Base is as follows:
(a) Net Operating Income for the 3 month
period ending on the last day of the
Fiscal Quarter just ended prior to
the date of determination, from each
Eligible Unencumbered Stabilized
Property $
(b) (a) divided by 0.09 $
(c) 4 times (b) $
(d) 0.60 times (c) $
(e) book value of Construction in Progress
on all Eligible Properties $
(f) 0.50 times (e) $
(g) lesser of (f) and $50,000,000 $
(h) cost of land acquired for
apartment community development $
(i) 0.40 times (h) $
(j) lesser of (i) and $15,000,000 $
BORROWING BASE: sum of (d), plus (g), plus (j) $
AMLI Residential Properties, L.P.,
a Delaware limited partnership
By:
[Chairman] [Vice Chairman]
[President] [Treasurer]
<PAGE>
EXHIBIT J
LIST OF ELIGIBLE PROPERTIES
Property Location
Sope Creek Properties Marietta, Georgia
AMLI at Autumn Chase Carrollton, Texas
AMLI at Autumn Chase II Carrollton, Texas
AMLI at Autumn Chase III Carrollton, Texas
AMLI at Chase Oaks Plano, Texas
AMLI at Gleneagles II Dallas, Texas
AMLI at Paces Vinings Atlanta, Georgia
AMLI at Paces Vinings-Phase II Atlanta, Georgia
AMLI at Bear Creek Euless, Texas
AMLI at West Paces Atlanta, Georgia
AMLI at Alvamar Lawrence, Kansas
AMLI at Crown Colony Topeka, Kansas
AMLI at Crown Colony II Atlanta, Georgia
AMLI at Spring Creek IV Atlanta, Georgia
AMLI at Wells Branch Austin, Texas
AMLI at Peachtree City Peachtree City, Georgia
AMLI on the Parkway Dallas, Texas
AMLI at Northwinds Fulton County, Georgia
AMLI at Arboretum
AMLI at Bent Tree
AMLI at Gleneagles
AMLI at Lantana Ridge
AMLI at Martha's Vineyard [to be completed]
AMLI at Town Center
AMLI at Park Creek (CIP)
AMLI at Killian Creek (CIP)
AMLI at Oakhurst North (CIP)
<PAGE>
EXHIBIT K
GUARANTY
THIS GUARANTY (this "Guaranty") is made as of ,
, jointly and severally, by and among , a
corporation (the "Guarantor"; the terms "Guarantor" and "Guarantors" shall
also include any Subsidiary of Amli Residential Properties L.P. which
becomes a Guarantor pursuant to Section 15 hereof and Section 5.28 of the
Credit Agreement referred to below) in favor of the Agent, for the ratable
benefit of the Banks, under the Credit Agreement referred to below;
W I T N E S S E T H
WHEREAS, AMLI Residential Properties, L.P., a Delaware limited
partnership (the "Borrower"), Wachovia Bank, N.A., as Agent (the "Agent"),
The First National Bank of Chicago, as Documentation Agent, and certain
other Banks from time to time party thereto have entered into a certain
Amended and Restated Credit Agreement dated as July __, 1998 (as amended as
of the date hereof and as it may be amended or modified further from time
to time, the "Credit Agreement"), providing, subject to the terms and
conditions thereof, for extensions of credit to be made by the Banks to the
Borrower which will the benefit the Guarantors;
WHEREAS, it is required under Section 5.28 of the Credit
Agreement, that the Guarantor execute and deliver this Guaranty whereby it
and, together with the other Guarantors which are or become such as
contemplated in such Section and in Section 15 hereof, shall guarantee the
payment when due of all principal, interest and other amounts that shall be
at any time payable by the Borrower under the Credit Agreement, the Notes
and the other Loan Documents; and
WHEREAS, in consideration of the financial and other support
that the Borrower has provided, and such financial and other support as the
Borrower may in the future provide, to the Guarantors, whether directly or
indirectly, and in order to induce the Banks and the Agent to enter into
and maintain the credit facilities under the Credit Agreement, the
Guarantors are willing to guarantee the obligations of the Borrower under
the Credit Agreement, the Notes, and the other Loan Documents;
NOW, THEREFORE, in consideration of the premises and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. Terms defined in the Credit Agreement
and not otherwise defined herein have, as used herein, the respective
meanings provided for therein.
SECTION 2. REPRESENTATIONS AND WARRANTIES. The Guarantors
incorporate herein by reference as fully as if set forth herein all of the
representations and warranties pertaining to the Guarantors contained in
Article IV of the Credit Agreement (which representations and warranties
shall be deemed to have been renewed by the Guarantors upon each Borrowing
under the Credit Agreement).
SECTION 3. COVENANTS. The Guarantors covenant that, so long
as any Bank has any Commitment outstanding under the Credit Agreement or
any amount payable under the Credit Agreement or any Note shall remain
unpaid, the Guarantors will fully comply with those covenants set forth in
Article V of the Credit Agreement pertaining to the Guarantors, and the
Guarantors incorporate herein by reference as fully as if set forth herein
all of such covenants.
<PAGE>
SECTION 4. THE GUARANTY. The Guarantors hereby
unconditionally and jointly and severally guarantee (i) the full and
punctual payment (whether at stated maturity, upon acceleration or
otherwise) of the principal of and interest on each Note issued by the
Borrower pursuant to the Credit Agreement, and the full and punctual
payment of all other amounts payable by the Borrower under the Credit
Agreement, including, without limitation, all Syndicated Loans and Swing
Loans and interest thereon, all compensation and indemnification amounts
and fees payable pursuant to the Credit Agreement and the Agent's Letter
Agreement, and (ii) the timely performance of all other obligations of the
Borrower under the Credit Agreement and the other Loan Documents (all of
the foregoing obligations being referred to collectively as the "Guaranteed
Obligations"). Upon failure by the Borrower to pay punctually any such
amount or perform such obligations, each of the Guarantors agrees that it
shall forthwith on demand pay the amount not so paid at the place and in
the manner specified in the Credit Agreement, the relevant Note or the
relevant Loan Document, as the case may be, or perform such obligation in
accordance with the terms and conditions therefor specified in the Credit
Agreement or the other Loan Documents, and pay all costs of collection,
including reasonable attorneys fees; PROVIDED that, notwithstanding the
provisions of O.C.G.A. Section 13-1-11(a)(2) to the contrary, the
Guarantors shall not be obligated to pay more than the attorneys fees
actually incurred in connection with such collection.
SECTION 5. GUARANTY UNCONDITIONAL. The obligations of the
Guarantors hereunder shall be unconditional and absolute and, without
limiting the generality of the foregoing, shall not be released, discharged
or otherwise affected by:
(i) any extension, renewal, settlement, compromise,
waiver or release in respect of any obligation of the Borrower under the
Credit Agreement, any Note, or any other Loan Document, by operation of law
or otherwise or any obligation of any other guarantor of any of the
Guaranteed Obligations;
(ii) any modification or amendment of or supplement to
the Credit Agreement, any Note, or any other Loan Document;
(iii) any release, nonperfection or invalidity of any
direct or indirect security, if any, for any obligation of the Borrower
under the Credit Agreement, any Note, any Loan Document, or any obligations
of any other guarantor of any of the Guaranteed Obligations;
(iv) any change in the partnership structure or ownership
of the Borrower or corporate structure or ownership of any other Guarantor
or any other guarantor of any of the Guaranteed Obligations, or any
insolvency, bankruptcy, reorganization or other similar proceeding
affecting the Borrower, or any other Guarantor or any other guarantor of
the Guaranteed Obligations, or its assets or any resulting release or
discharge of any obligation of the Borrower, or any other Guarantor or any
other guarantor of any of the Guaranteed Obligations;
(v) the existence of any claim, setoff or other rights
which the Guarantors may have at any time against the Borrower, any other
Guarantor or any other guarantor of any of the Guaranteed Obligations, the
Agent, any Bank or any other Person, whether in connection herewith or any
unrelated transactions, provided that nothing herein shall prevent the
assertion of any such claim by separate suit or compulsory counterclaim;
<PAGE>
(vi) any invalidity or unenforceability relating to or
against the Borrower, or any other Guarantor or any other guarantor of any
of the Guaranteed Obligations, for any reason related to the Credit
Agreement, any other Loan Document, or any other Guaranty, or any provision
of applicable law or regulation purporting to prohibit the payment by the
Borrower, or any other Guarantor or any other guarantor of the Guaranteed
Obligations, of the principal of or interest on any Note or any other
amount payable by the Borrower under the Credit Agreement, the Notes, or
any other Loan Document; or
(vii) any other act or omission to act or delay of any
kind by the Borrower, any other Guarantor or any other guarantor of the
Guaranteed Obligations, the Agent, any Bank or any other Person or any
other circumstance whatsoever which might, but for the provisions of this
paragraph, constitute a legal or equitable discharge of any Guarantor's
obligations hereunder.
SECTION 6. DISCHARGE ONLY UPON PAYMENT IN FULL; REINSTATEMENT
IN CERTAIN CIRCUMSTANCES. The Guarantors' obligations hereunder shall
remain in full force and effect until all Guaranteed Obligations shall have
been paid in full and the Commitments under the Credit Agreement shall have
terminated or expired. If at any time any payment of the principal of or
interest on any Note or any other amount payable by the Borrower under the
Credit Agreement or any other Loan Document is rescinded or must be
otherwise restored or returned upon the insolvency, bankruptcy or
reorganization of the Borrower or otherwise, the Guarantors' obligations
hereunder with respect to such payment shall be reinstated as though such
payment had been due but not made at such time.
SECTION 7. WAIVER OF NOTICE BY THE GUARANTORS. The Guarantors
irrevocably waive acceptance hereof, presentment, demand, protest and, to
the fullest extent permitted by law, any notice not provided for herein, as
well as any requirement that at any time any action be taken by any Person
against the Borrower, any other Guarantor or any other guarantor of the
Guaranteed Obligations, or any other Person.
SECTION 8. STAY OF ACCELERATION. If acceleration of the time
for payment of any amount payable by the Borrower under the Credit
Agreement, any Note or any other Loan Document is stayed upon the
insolvency, bankruptcy or reorganization of the Borrower, all such amounts
otherwise subject to acceleration under the terms of the Credit Agreement,
any Note or any other Loan Document shall nonetheless be payable by the
Guarantors hereunder forthwith on demand by the Agent made at the request
of the Required Banks.
SECTION 9. NOTICES. All notices, requests and other
communications to any party hereunder shall be given or made by telecopier
or other writing and telecopied or mailed or delivered to the intended
recipient at its address or telecopier number set forth on the signature
pages hereof or such other address or telecopy number as such party may
hereafter specify for such purpose by notice to the Agent in accordance
with the provisions of Section 9.01 of the Credit Agreement. Except as
otherwise provided in this Guaranty, all such communications shall be
deemed to have been duly given when transmitted by telecopier, or
personally delivered or, in the case of a mailed notice, 3 Domestic
Business Days after such communication is deposited in the mails with first
class postage prepaid, in each case given or addressed as aforesaid.
SECTION 10. NO WAIVERS. No failure or delay by the Agent or
any Banks in exercising any right, power or privilege hereunder shall
operate as a waiver thereof nor shall any single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The rights and remedies provided in
this Guaranty, the Credit Agreement, the Notes, and the other Loan
Documents shall be cumulative and not exclusive of any rights or remedies
provided by law.
<PAGE>
SECTION 11. SUCCESSORS AND ASSIGNS. This Guaranty is for the
benefit of the Agent and the Banks and their respective successors and
assigns and in the event of an assignment of any amounts payable under the
Credit Agreement, the Notes, or the other Loan Documents, the rights
hereunder, to the extent applicable to the indebtedness so assigned, may be
transferred with such indebtedness. This Guaranty may not be assigned by
the Guarantors without the prior written consent of the Agent and the
Required Banks, and shall be binding upon the Guarantors and their
respective successors and permitted assigns.
SECTION 12. CHANGES IN WRITING. Neither this Guaranty nor any
provision hereof may be changed, waived, discharged or terminated orally,
but only in writing signed by the Guarantors and the Agent, with the
consent of the Required Banks.
SECTION 13. GOVERNING LAW; SUBMISSION TO JURISDICTION; WAIVER
OF JURY TRIAL. THIS GUARANTY SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF GEORGIA. EACH OF THE GUARANTORS
AND THE AGENT HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA AND OF ANY
GEORGIA STATE COURT SITTING IN ATLANTA, GEORGIA AND FOR PURPOSES OF ALL
LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS GUARANTY OR THE
TRANSACTIONS CONTEMPLATED HEREBY. THE GUARANTORS IRREVOCABLY WAIVE, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH ANY OF THEM MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN
SUCH A COURT AND ANY CLAIM THAT ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT
HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE GUARANTORS AND THE
AGENT HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS GUARANTY OR THE TRANSACTIONS CONTEMPLATED HEREBY.
SECTION 14. TAXES, ETC. All payments required to be made by
the Guarantors hereunder shall be made without setoff or counterclaim and
free and clear of and without deduction or withholding for or on account
of, any present or future taxes, levies, imposts, duties or other charges
of whatsoever nature imposed by any government or any political or taxing
authority pursuant and subject to the provisions of Section 2.10(c) of the
Credit Agreement, the terms of which are incorporated herein by reference
as to the Guarantors as fully as if set forth herein, and for such
purposes, the rights and obligations of the Borrower under such Section
shall devolve to the Guarantors as to payments required to be made by the
Guarantors hereunder.
SECTION 15. ADDITIONAL GUARANTORS; RELEASE OF GUARANTORS.
Section 5.28 of the Credit Agreement provides that all new Subsidiaries and
must become Guarantors, by, among other things, executing and delivering to
the Agent a counterpart of this Guaranty. Any Subsidiary which executes
and delivers to the Agent a counterpart of this Guaranty shall be a
Guarantor for all purposes hereunder. Under certain circumstances
described in the last sentence of Section 5.05 of the Credit Agreement,
Guarantors may obtain from the Agent a written release from this Guaranty
pursuant to the provisions of such sentence, and upon obtaining such
written release, any such Subsidiary shall no longer be a Guarantor
hereunder. Each other Guarantor consents and agrees to any such release
and agrees that no such release shall affect its obligations hereunder.
<PAGE>
SECTION 16. OTHER WAIVERS BY THE GUARANTORS. The Guarantors
hereby expressly waive, renounce, and agree not to assert, any right, claim
or cause of action, including, without limitation, a claim for
reimbursement, subrogation, indemnification or otherwise, against the
Borrower arising out of or by reason of this Guaranty or the obligations of
the Guarantors hereunder, including, without limitation, the payment or
securing or purchasing of any of the Guaranteed Obligations by the
Guarantors. The waiver, renunciation and agreement contained in the
immediately preceding sentence is for the benefit of the Agent and the
Banks and also for the benefit of the Borrower who may assert the benefits
thereof as a third-party beneficiary, and the Guarantors may be released
from such waiver, renunciation and agreement only by the execution and
delivery, by the Agent, the Required Banks and the Borrower, of an
instrument expressly releasing the Guarantors therefrom.
IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be
duly executed, under seal, by its authorized officer as of the date first
above written.
By:
------------------------------
Title:
<PAGE>
EXHIBIT L
CONTRIBUTION AGREEMENT
THIS CONTRIBUTION AGREEMENT (this "Agreement") is entered into
as of , , jointly and severally, by and among AMLI
Residential Properties, L.P., a Delaware limited partnership (the
"Principal"), and , a corporation (the
"Guarantor"; the terms "Guarantor" and "Guarantors" shall also include any
Subsidiary of the Principal which becomes a Guarantor pursuant to the last
paragraph hereof and Section 5.28 of the Credit Agreement referred to
below). The Principal and each of the Subsidiary Guarantors are sometimes
hereinafter referred to individually as a "Contributing Party" and
collectively as the "Contributing Parties").
W I T N E S S E T H:
WHEREAS, pursuant to that certain Amended and Restated Credit
Agreement, dated as of July __, 1998 among the Principal, the Banks party
thereto, Wachovia Bank, N.A., as Agent and The First National Bank of
Chicago, as Documentation Agent (such agreement, as amended as of the date
hereof and as the same may from time to time be amended, modified, restated
or extended, being hereinafter referred to as the "Credit Agreement";
capitalized terms used herein shall have the meanings ascribed thereto in
the Credit Agreement), the Banks have agreed to extend financial
accommodations to the Principal;
WHEREAS, Section 5.28 of the Credit Agreement requires that the
Guarantor execute and deliver that certain Guaranty, dated as of even date
herewith (such agreement, as the same may from time to time be amended,
modified, restated or extended, being hereinafter referred to as the
"Guaranty"), pursuant to which, among other things, the Guarantor and,
together with other Guarantors which become such as contemplated in the
last paragraph hereof, have jointly and severally agreed to guarantee the
"Guaranteed Obligations" (as defined in the Guaranty); and
WHEREAS, each Guarantor is a direct or indirect subsidiary of
the Principal and is engaged in businesses related to those of the
Principal and each other Guarantor, and each of the Guarantors will derive
direct or indirect economic benefit from the effectiveness and existence of
the Credit Agreement;
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained, and to induce each Guarantor to enter into
the Guaranty, it is agreed as follows:
To the extent that any Guarantor shall, under the Guaranty, make
a payment (a "Guarantor Payment") of a portion of the Guaranteed
Obligations, then, without limiting its rights of subrogation against the
principal, such Guarantor shall be entitled to contribution and
indemnification from, and be reimbursed by, each of the other Contributing
Parties in an amount, for each such Contributing Party, equal to a fraction
of such Guarantor Payment, the numerator of which fraction is such
Contributing Party's Allocable Amount and the denominator of which is the
sum of the Allocable Amounts of all of the Contributing Parties.
As of any date of determination, the "Allocable Amount" of each
Contributing Party shall be equal to the maximum amount of liability which
could be asserted against such Contributing Party hereunder with respect to
the applicable Guarantor Payment without (i) rendering such Contributing
Party "insolvent" within the meaning of Section 101(31) of the Federal
Bankruptcy Code (the "Bankruptcy Code") or Section 2 of either the Uniform
Fraudulent Transfer Act (the "UFTA") or the Uniform Fraudulent Conveyance
Act (the "UFCA"), (ii) leaving such Contributing Party with unreasonably
small capital, within the meaning of Section 548 of the Bankruptcy Code or
Section 4 of the UFTA or Section 5 of the UFCA, or (iii) leaving such
Contributing Party unable to pay its debts as they become due within the
meaning of Section 548 of the Bankruptcy Code or Section 4 of the UFTA or
Section 6 of the UFCA.
<PAGE>
This Agreement is intended only to define the relative rights of
the Contributing Parties, and nothing set forth in this Agreement is
intended to or shall impair the obligations of the Guarantors, jointly and
severally, to pay any amounts, as and when the same shall become due and
payable in accordance with the terms of the Guaranty.
The parties hereto acknowledge that the rights of contribution
and indemnification hereunder shall constitute assets in favor of each
Guarantor to which such contribution and indemnification is owing.
This Agreement shall become effective upon its execution by each
of the Contributing Parties and shall continue in full force and effect and
may not be terminated or otherwise revoked by any Contributing Party until
all of the Guaranteed Obligations shall have been indefeasibly paid in full
(in lawful money of the United States of America) and discharged and the
Credit Agreement and financing arrangements evidenced and governed by the
Credit Agreement shall have been terminated. Each Contributing Party
agrees that if, notwithstanding the foregoing, such Contributing Party
shall have any right under applicable law to terminate or revoke this
Agreement, and such Contributing Party shall attempt to exercise such
right, then such termination or revocation shall not be effective until a
written notice of such revocation or termination, specifically referring
hereto and signed by such Contributing Party, is actually received by each
of the other Contributing Parties and by the Agent at its notice address
set forth in the Credit Agreement. Such notice shall not affect the right
or power of any Contributing Party to enforce rights arising prior to
receipt of such written notice by each of the other Contributing Parties
and the Agent. If any Bank grants additional loans to the Principal or
takes other action giving rise to additional Guaranteed Obligations after
any Contributing Party has exercised any right to terminate or revoke this
Agreement but before the Agent receives such written notice, the rights of
each other Contributing Party to contribution and indemnification hereunder
in connection with any Guarantor Payments made with respect to such loans
or Guaranteed Obligations shall be the same as if such termination or
revocation had not occurred.
Section 5.28 of the Credit Agreement provides that new Subsidiaries,
must become Guarantors by, among other things, executing and delivering to
the Agent a counterpart of the Guaranty and of this Contribution Agreement.
Any Subsidiary which executes and delivers to the Agent a counterpart of
the Guaranty and of this Contribution Agreement shall be a Guarantor for
all purposes hereunder. Under certain circumstances described in the last
sentence of Section 5.05 of the Credit Agreement, Guarantors may obtain
from the Agent a written release from the Guaranty pursuant to the
provisions of such sentence, and upon obtaining such written release, any
such Subsidiary shall no longer be a Guarantor or Contributing Party
hereunder, and such release shall automatically and without further action
constitute a release by each other Contributing Party of all obligations of
such Subsidiary hereunder. Each other Guarantor consents and agrees to any
such release and agrees that no such release shall affect its obligations
hereunder, except as to the Subsidiary so released.
<PAGE>
IN WITNESS WHEREOF, each Contributing Party has executed and delivered
this Agreement, under seal, as of the date first above written.
AMLI RESIDENTIAL PROPERTIES, L.P.
(SEAL)
By: AMLI RESIDENTIAL PROPERTIES TRUST,
a Maryland real estate
investment trust,
its General Partner
By:
------------------------------
Title:
------------------------------
By:
------------------------------
Title:
<PAGE>
EXHIBIT M
MONEY MARKET QUOTE REQUEST
Wachovia Bank, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: MONEY MARKET QUOTE REQUEST
This Money Market Quote Request is given in accordance with
Section 2.03 of the Amended and Restated Credit Agreement (as amended or
modified from time to time, the "Credit Agreement") dated as of July ,
1998, among AMLI RESIDENTIAL PROPERTIES, L.P., the Banks from time to time
parties thereto, and WACHOVIA BANK, N.A., as Agent. Terms defined in the
Credit Agreement are used herein as defined therein.
The Borrower hereby requests that the Agent obtain quotes for a Money
Market Borrowing based upon the following:
1. The proposed date of the Money Market Borrowing shall be
______________, 19_____ (the "Money Market Borrowing Date").1*
2. The aggregate amount of the Money Market Borrowing shall be $
.2
3. The Stated Maturity Date(s) applicable to the Money Market
Borrowing shall be days.3
- ------------------------------
* All numbered footnotes appear on the last page of this Exhibit M.
<PAGE>
AMLI RESIDENTIAL PROPERTIES, L.P.,
a Delaware Limited Partnership
By: AMLI Residential Properties
Trust, a Maryland real estate
investment trust, its General
Partner
By:
------------------------------
Title:
1 The date must be a Euro-Dollar Business
Day.
2 The amount of the Money Market
Borrowing is subject to Section 2.03(a) and (b).
3 The Stated Maturity Dates are subject
to Section 2.03(b)(iii). The Borrower may request that up to 2 different
Stated Maturity Dates be applicable to any Money Market Borrowing, PROVIDED
that (i) each such Stated Maturity Date shall be deemed to be a separate
Money Market Quote Request and (ii) the Borrower shall specify the amounts
of such Money Market Borrowing to be subject to each such different Stated
Maturity Date.
<PAGE>
EXHIBIT N
MONEY MARKET QUOTE
Wachovia Bank, N.A.,
as Agent
191 Peachtree Street, N.E.
Atlanta, Georgia 30303-1757
Attention: Syndications Group
Re: Money Market Quote to
This Money Market Quote is given in accordance with Section
2.03(c)(ii) of the Credit Agreement (as amended or modified from time to
time, the "Credit Agreement") dated as of July ___, 1998, among AMLI
RESIDENTIAL PROPERTIES, L.P. (the "Borrower"), the Banks from time to time
parties thereto, and WACHOVIA BANK, N.A., as Agent. Terms defined in the
Credit Agreement are used herein as defined therein.
In response to the Borrower's Money Market Quote Request dated
, 19 , we hereby make the following Money Market Quote on the following
terms:
1. Quoting Bank:
2. Person to contact
at Quoting Bank:
3. Date of Money Market Borrowing:1*
4. We hereby offer to make Money Market Loan(s) in the following maximum
principal amounts for the following Interest Periods and at the following
rates:
Maximum Stated
Principal Maturity
Amount 2 Date 3 Rate Per Annum4
- ------------------------------
* All numbered footnotes appear on the last page of this Exhibit N.
<PAGE>
We understand and agree that the offer(s) set forth above, subject to
the satisfaction of the applicable conditions set forth in the Credit
Agreement, irrevocably obligate(s) us to make the Money Market Loan(s) for
which any offer(s) [is] [are] accepted, in whole or in part (subject to the
last sentence of Section 2.03(c)(i) of the Credit Agreement).
Very truly yours,
[Name of Bank]
Dated: By:
---------------------------
Authorized Officer
- --------------------
1 As specified in the related Money Market Quote Request.
2 The principal amount bid for each Stated Maturity Date may not exceed
the principal amount requested. Money Market Quotes must be made for at
least [$5,000,000] or a larger integral multiple of [$500,000].
3 The Stated Maturity Dates are subject to Section 2.03(b)(ii).
4 Subject to Section 2.03(c)(ii)(C).
<PAGE>
Schedule 4.08
Subsidiaries and Co-Investment Partnerships
Name Jurisdiction of Creation
Amli Partners Ltd. 85-IV Illinois
Amli Towne Creek Crossing Georgia
Amli Foundation Co-Investors, L.P. Delaware
Amli at Champions, L.P. Texas
Pleasant Hill Joint Venture Georgia
Amli at Windbrooke, L.P. Illinois
Amli Foundation Co-Investors-II, L.P. Delaware
Barrett Lakes Limited Liability Company Delaware
Amli at Willeo Creek, L.P. Georgia
Amli at Chevy Chase, L.P. Illinois
Amli at Willowbrook, L.P. Illinois
Amli at River Exchange, L.L.C. Delaware
Acquiport/Aurora Crossing, L.P. Delaware
Acquiport/Fossil Creek, L.P. Delaware
Amli at Danada, L.L.C. Illinois
Amli at Verandah, L.P. Delaware
<PAGE>
Schedule 4.14
Environmental Matters
None
<PAGE>
Schedule 5.17
Existing Investments (12)
Real Estate Tax Escrow Deposits $1,043,708
Earnest Money Deposits $ 400,100
Commercial Paper $ 550,000
Restricted Cash $ 538,179
Security Deposits $1,718,549
(12) Exclude Subsidiaries and Co-Investment Partnerships, which are
set forth on Schedule 4.08.
EXHIBIT 21.1
- ------------
SUBSIDIARIES OF THE COMPANY
COMPANY'S
JURISDICTION PERCENTAGE
NAME OF SUBSIDIARY OF INCORPORATION OWNERSHIP
- ------------------ ---------------- ----------
AMLI Residential Properties, L.P.. . . . . . Delaware 84%
A. AMLI Residential Construction, Inc. . Delaware 95%
B. AMLI Institutional Advisors, Inc. . . Illinois 95%
C. AMLI Management Company . . . . . . . Delaware 95%
D. Laurel Park Venture . . . . . . . . . Georgia 100%
E. Pleasant Hill Joint Venture . . . . . Georgia 40%
F. AMLI Foundation Co-Investors, L. P. . Delaware 25%
G. AMLI Foundation Co-Investors-II,
L. P. . . . . . . . . . . . . . . . Delaware 15%
H. AMLI at Champions, L. P. . . . . . . Texas 15%
I. AMLI at Windbrooke, L. P. . . . . . . Illinois 15%
J. AMLI at Willeo Creek, L. P. . . . . . Georgia 30%
K. Barrett Lakes, L.L.C. . . . . . . . . Delaware 35%
L. AMLI at Chevy Chase, L.P. . . . . . . Illinois 33%
M. AMLI at Willowbrook, L.P. . . . . . . Illinois 40%
N. AMLI at River Exchange, L.L.C.. . . . Delaware 40%
O. Acquiport/Aurora Crossing, L.P. . . . Delaware 25%
P. Acquiport/Fossil Creek, L.P.. . . . . Delaware 25%
Q. AMLI at Danada, L.L.C.. . . . . . . . Illinois 10%
R. AMLI at Verandah, L.P.. . . . . . . . Delaware 35%
S. Gardner Drive Limited Liability
Company . . . . . . . . . . . . . . . Delaware 35%
T. AMLI at Regents Crest, L.P. . . . . . Delaware 25%
U. Park Creek-Gainsville, L.L.C. . . . . Georgia 100%
V. Timberglen, L.P.. . . . . . . . . . . Delaware 100%
W. AMLI Partners Ltd. 85-IV. . . . . . . Illinois 1%
X. AMLI Towne Creek Crossing L.P.. . . . Georgia 1%
Y. Lantana Apartments, Ltd.. . . . . . . Texas 100%
Z. Windsor Plano Partners, Ltd.. . . . . Texas 100%
AA. AMLI at Conner Farms, L.P.. . . . . . Delaware 100%
BB. Clairmont, L.P. . . . . . . . . . . . Delaware 100%
BC. Wells Oakhurst, L.P.. . . . . . . . . Delaware 25%
BD. AMLIWS on the Parkway L.P.. . . . . . Texas 25%
BE. AMLI at St. Charles, L.L.C. . . . . . Delaware 100%
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S FORM 10-Q FOR THE SIX MONTHS ENDED JUNE 30, 1998 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS
INCLUDED IN SUCH REPORT.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 3,120
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 690,771
<DEPRECIATION> 71,159
<TOTAL-ASSETS> 721,688
<CURRENT-LIABILITIES> 0
<BONDS> 337,108
0
32
<COMMON> 166
<OTHER-SE> 317,307
<TOTAL-LIABILITY-AND-EQUITY> 721,688
<SALES> 0
<TOTAL-REVENUES> 55,971
<CGS> 0
<TOTAL-COSTS> 42,022
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 9,738
<INCOME-PRETAX> 11,907
<INCOME-TAX> 0
<INCOME-CONTINUING> 11,907
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 11,907
<EPS-PRIMARY> .62
<EPS-DILUTED> .62
</TABLE>
EXHIBIT 99
- ----------
AMLI RESIDENTIAL PROPERTIES TRUST
FINANCIAL AND OPERATING DATA
June 30, 1998
1. Funds from Operations
2. Statements of Operations
3. Balance Sheets
4. Selected Financial Information
5. Debt
6. Debt Maturities
7. Same Community Comparison - Wholly-Owned
- three months ended June 30, 1998 and 1997
8. Same Community Comparison - Wholly-Owned
- six months ended June 30, 1998 and 1997
9. Same Community Comparison - Wholly-Owned
and Co-Investments
- three months ended June 30, 1998 and 1997
10. Same Community Comparison - Wholly-Owned
and Co-Investments
- six months ended June 30, 1998 and 1997
11. Property Information
12. Property EBITDA
13. Development Activities
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
FUNDS FROM OPERATIONS
Unaudited - Dollars in thousands except per share data
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
<S> <C> <C> <C> <C>
REVENUES
- --------
Property revenues:
Rental . . . . . . . . . . . . . . . . . . $ 25,204 $ 19,281 $ 49,342 $ 37,961
Other. . . . . . . . . . . . . . . . . . . 1,456 1,019 2,748 1,994
-------- -------- -------- --------
Total Property Revenues. . . . . . . 26,660 20,300 52,090 39,955
-------- -------- -------- --------
Property operating expenses. . . . . . . . . (10,434) (7,883) (19,986) (15,453)
Property management fees . . . . . . . . . . (667) (517) (1,305) (1,008)
-------- -------- -------- --------
Property expenses. . . . . . . . . . (11,101) (8,400) (21,291) (16,461)
Operating expense ratio. . . . . . . . . . . 41.6% 41.4% 40.9% 41.2%
-------- -------- -------- --------
Net operating income . . . . . . . . 15,559 11,900 30,799 23,494
-------- -------- -------- --------
OTHER INCOME
- ------------
Share of Service Cos. FFO (1) . . . . . . . 120 66 108 77
Interest from Service Companies (2) . . . . 606 187 1,151 440
Other interest. . . . . . . . . . . . . . . 223 120 414 227
Share of partnerships FFO (3) . . . . . . . 1,355 820 2,489 1,487
Fee income - acquisitions and
dispositions. . . . . . . . . . . . . . . -- -- -- 137
Fee income - developments . . . . . . . . . 1,105 271 1,206 601
Fee income - asset management . . . . . . . 151 151 302 304
Other . . . . . . . . . . . . . . . . . . . 41 52 77 89
-------- -------- -------- --------
Total other income . . . . . . . . . 3,601 1,667 5,747 3,362
General and administrative (4) . . . . . . . (1,112) (706) (1,966) (1,473)
-------- -------- -------- --------
EBITDA . . . . . . . . . . . . . . . . . . . 18,048 12,861 34,580 25,383
-------- -------- -------- --------
Interest expense . . . . . . . . . . . . . . (4,800) (2,886) (9,738) (5,532)
Amortization of deferred costs . . . . . . . (118) (87) (248) (330)
-------- -------- -------- --------
FUNDS FROM OPERATIONS (FFO). . . . . . . . . $ 13,130 $ 9,888 $ 24,594 $ 19,521
======== ======== ======== ========
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
FUNDS FROM OPERATIONS - CONTINUED
Unaudited - Dollars in thousands except per share data
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
Capital expenditures paid from FFO . . . . . (1,062) (749) (1,854) (1,880)
Other - share of Co-investments
Cap exp. . . . . . . . . . . . . . . . . . (103) (66) (147) (100)
-------- -------- -------- --------
Funds available for distribution
(FAD). . . . . . . . . . . . . . . . . . . $ 11,965 $ 9,073 $ 22,593 $ 17,541
======== ======== ======== ========
FFO per share. . . . . . . . . . . . . . . . $ 0.59 $ 0.52 $ 1.13 $ 1.03
FAD per share. . . . . . . . . . . . . . . . $ 0.54 $ 0.48 $ 1.04 $ 0.93
Dividend per share . . . . . . . . . . . . . $ 0.44 $ 0.43 $ 0.88 $ 0.86
======== ======== ======== ========
Dividend as a % of FFO . . . . . . . . . . . 74.1% 82.5% 77.6% 83.5%
Dividend as a % of FAD . . . . . . . . . . . 81.3% 89.9% 84.6% 92.5%
======== ======== ======== ========
<FN>
NOTES:
(1) Includes share of income and share of goodwill amortization of $200 for the six months ended June 30, 1998.
(2) Interest on 13% notes receivable and working capital advances.
(3) Includes share of income and share of depreciation of $1,666 and $1,154 for the six months ended June 30,
1998 and 1997, respectively.
(4) Includes $100 provision for write off of predevelopment costs for the three and six months ended June 30,
1998.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENT OF OPERATIONS
Unaudited - Dollars in thousands except per share data
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
<S> <C> <C> <C> <C>
REVENUES
- --------
Property revenues:
Rental . . . . . . . . . . . . . . . . . . $ 25,204 $ 19,281 $ 49,342 $ 37,961
Other. . . . . . . . . . . . . . . . . . . 1,456 1,019 2,748 1,994
Interest and share of income (loss)
from Service Cos. . . . . . . . . . . . . . 630 253 1,059 517
Other interest . . . . . . . . . . . . . . . 223 120 414 227
Share of income from co-investment
partnerships. . . . . . . . . . . . . . . . 499 166 823 333
Fees from co-investment partnerships . . . . 1,297 474 1,585 1,131
-------- -------- -------- --------
Total revenues . . . . . . . . . . . 29,309 21,313 55,971 42,163
-------- -------- -------- --------
EXPENSES
- --------
Personnel. . . . . . . . . . . . . . . . . . 2,529 1,822 4,846 3,545
Advertising and promotion. . . . . . . . . . 796 482 1,504 989
Utilities. . . . . . . . . . . . . . . . . . 1,059 909 2,144 1,934
Building repairs and maintenance . . . . . . 1,490 1,407 2,745 2,563
Landscaping and grounds maintenance. . . . . 648 515 1,090 879
Real estate taxes. . . . . . . . . . . . . . 3,274 2,312 6,454 4,634
Insurance. . . . . . . . . . . . . . . . . . 251 200 472 398
Other operating expenses . . . . . . . . . . 387 236 731 511
Property management fees . . . . . . . . . . 667 517 1,305 1,008
Interest, net of capitalized . . . . . . . . 4,800 2,886 9,738 5,532
Amortization of deferred costs . . . . . . . 118 87 248 330
Depreciation of real property. . . . . . . . 3,277 2,376 6,447 4,692
Depreciation of personal property. . . . . . 1,211 820 2,332 1,561
General and administrative . . . . . . . . . 1,112 706 1,966 1,473
-------- -------- -------- --------
Total expenses . . . . . . . . . . . 21,619 15,275 42,022 30,049
-------- -------- -------- --------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENT OF OPERATIONS - CONTINUED
Unaudited - Dollars in thousands except per share data
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
Non-recurring item - gain on sale
of properties and rate caps. . . . . . . . -- -- -- --
-------- -------- -------- --------
Income before taxes, minority interest
and extraordinary item . . . . . . . . . . 7,690 6,038 13,949 12,114
-------- -------- -------- --------
Income taxes . . . . . . . . . . . . . . . . -- -- -- --
-------- -------- -------- --------
Income before minority interest/extra-
ordinary items . . . . . . . . . . . . . . 7,690 6,038 13,949 12,114
Minority interest. . . . . . . . . . . . . . 1,109 958 2,042 1,911
-------- -------- -------- --------
Income before and extraordinary items. . . . 6,581 5,080 11,907 10,203
Extraordinary items net of minority interest -- (177) -- (177)
-------- -------- -------- --------
Net income . . . . . . . . . . . . . . . . . $ 6,581 $ 4,903 $ 11,907 $ 10,026
======== ======== ======== ========
Net income allocable to preferred shares . . 958 473 1,562 946
-------- -------- -------- --------
Net income allocable to common shares. . . . $ 5,623 $ 4,430 $ 10,345 $ 9,080
======== ======== ======== ========
INCOME PER COMMON SHARE:
- -----------------------
Before extraordinary items . . . . . . . . . $ 0.34 $ 0.31 $ 0.62 $ 0.62
Extraordinary item . . . . . . . . . . . . . $ 0.00 $ (0.01) $ 0.00 $ (0.01)
Income per common share. . . . . . . . . . . $ 0.34 $ 0.30 $ 0.62 $ 0.61
======== ======== ======== ========
FUNDS FROM OPERATIONS
- ---------------------
Income before taxes, minority interest and
extraordinary item . . . . . . . . . . . . $ 7,690 $ 6,038 $ 13,949 $ 12,114
-------- -------- -------- --------
Depreciation of real property. . . . . . . . 3,277 2,376 6,447 4,692
Depreciation of personal property. . . . . . 1,211 820 2,332 1,561
Non-recurring items. . . . . . . . . . . . . -- -- -- --
Share of Co-investments depreciation . . . . 856 654 1,666 1,154
Share of Service Company amortization
of goodwill. . . . . . . . . . . . . . . . 96 -- 200 --
-------- -------- -------- --------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
STATEMENT OF OPERATIONS - CONTINUED
Unaudited - Dollars in thousands except per share data
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
------------------------ ------------------------
1998 1997 1998 1997
-------- -------- -------- --------
Funds from operations (FFO). . . . . . . . . $ 13,130 $ 9,888 $ 24,594 $ 19,521
FFO per share. . . . . . . . . . . . . . . . $ 0.59 $ 0.52 $ 1.13 $ 1.03
======== ======== ======== ========
Capital expenditures paid from FFO . . . . . (1,062) (749) (1,854) (1,880)
Other - Share Co-investments Cap exp . . . . (103) (66) (147) (100)
-------- -------- -------- --------
Funds available for distribution (FAD) . . . $ 11,965 $ 9,073 $ 22,593 $ 17,541
FAD per share. . . . . . . . . . . . . . . . $ 0.54 $ 0.48 $ 1.04 $ 0.93
======== ======== ======== ========
Dividends per share. . . . . . . . . . . . . $ 0.44 $ 0.43 $ 0.88 $ 0.86
======== ======== ======== ========
Dividends as a % of FFO. . . . . . . . . . . 74.1% 82.5% 77.6% 83.5%
Dividends as a % of FAD. . . . . . . . . . . 81.3% 89.9% 84.6% 92.5%
======== ======== ======== ========
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONDENSED BALANCE SHEETS
Unaudited - Dollars in thousands except per share data
<CAPTION>
JUN. 30, DEC. 31,
1998 1997
-------- --------
<S> <C> <C>
ASSETS
- ------
Rental apartments
Land . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 83,471 $ 78,476
Depreciable property . . . . . . . . . . . . . . . . . . . . . . . 532,706 496,747
-------- --------
616,177 575,223
Less accumulated depreciation. . . . . . . . . . . . . . . . . . . (71,159) (62,641)
-------- --------
545,018 512,582
Properties under development . . . . . . . . . . . . . . . . . . . . 74,594 78,724
Investments in partnerships. . . . . . . . . . . . . . . . . . . . . 60,604 50,729
Cash and cash equivalents. . . . . . . . . . . . . . . . . . . . . . 3,120 5,676
Security deposits. . . . . . . . . . . . . . . . . . . . . . . . . . 1,779 1,821
Deferred costs, net. . . . . . . . . . . . . . . . . . . . . . . . . 3,098 3,140
Notes receivable and advances to Service Companies . . . . . . . . . 23,475 18,356
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,000 8,950
-------- --------
Total assets . . . . . . . . . . . . . . . . . . . . . . . . $721,688 $679,978
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $337,108 $333,250
Accrued interest payable . . . . . . . . . . . . . . . . . . . . . . 1,359 1,389
Accrued real estate taxes. . . . . . . . . . . . . . . . . . . . . . 7,863 9,334
Construction costs payable . . . . . . . . . . . . . . . . . . . . . 3,065 8,403
Security deposits and prepaid rents. . . . . . . . . . . . . . . . . 2,992 2,722
Other liabilities. . . . . . . . . . . . . . . . . . . . . . . . . . 2,065 2,978
-------- --------
Total liabilities. . . . . . . . . . . . . . . . . . . . . . $354,452 $358,076
-------- --------
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
CONDENSED BALANCE SHEETS - CONTINUED
Unaudited - Dollars in thousands except per share data
JUN. 30, DEC. 31,
1998 1997
-------- --------
Minority interest. . . . . . . . . . . . . . . . . . . . . . . . . . $ 49,731 $ 51,463
-------- --------
Shareholders' equity
Preferred shares, $.01 par value . . . . . . . . . . . . . . . . . 32 11
Shares of beneficial interest, $.01 par value. . . . . . . . . . . 166 166
Additional paid-in capital . . . . . . . . . . . . . . . . . . . . 392,475 341,148
Employees and trustees notes . . . . . . . . . . . . . . . . . . . (7,417) (6,924)
Retained earnings. . . . . . . . . . . . . . . . . . . . . . . . . 30,804 18,897
Dividends paid . . . . . . . . . . . . . . . . . . . . . . . . . . (98,555) (82,859)
-------- --------
Total shareholders' equity . . . . . . . . . . . . . . . . . 317,505 270,439
-------- --------
Total liabilities and shareholders' equity . . . . . . . . . $721,688 $679,978
======== ========
</TABLE>
<PAGE>
<TABLE>
Amli Residential Properties Trust
Selected Quarterly Financial Information
June 30, 1998
(dollars in thousands except for share data)
<CAPTION>
Quarter Ending
---------------------------------------------------------------------------------
Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
1998 1998 1997 1997 1997 1997
-------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C>
Total Debt $337,108 $361,305 $333,250 $235,692 $238,061 $220,964
Total Debt (1) 400,485 422,393 392,295 289,097 290,699 271,738
Total Shares and
Units Outstanding (2) 23,085,101 22,028,680 20,958,523 20,675,333 18,976,280 18,968,168
Value per Common Share
- end of quarter $21.4375 $ 22.938 $ 22.250 $ 23.250 $ 23.625 $ 23.000
Total Equity (Market
Value) - end of quarter $494,887 $505,283 $466,327 $480,701 $448,315 $436,268
Total Market Capitalization $831,995 $866,588 $799,577 $716,393 $686,376 $657,232
Total Market Capitalization (1) $895,372 $927,676 $858,622 $769,798 $739,014 $708,006
======== ======== ======== ======== ======== ========
Total Revenues (3) $ 29,309 $ 26,662 $ 24,928 $ 22,982 $ 21,313 $ 20,850
EBITDA (4) $ 18,048 $ 16,532 $ 15,420 $ 13,961 $ 12,861 $ 12,522
FFO $ 13,130 $ 11,464 $ 11,414 $ 11,237 $ 9,888 $ 9,633
FAD $ 11,965 $ 10,628 $ 10,752 $ 10,358 $ 9,073 $ 8,468
Dividends Paid $ 9,356 $ 9,224 $ 9,037 $ 8,889 $ 8,158 $ 8,111
Debt service (net of
capitalized interest) $ 5,441 $ 5,571 $ 4,340 $ 3,154 $ 3,420 $ 3,195
Interest Expense $ 4,800 $ 4,938 $ 3,844 $ 2,619 $ 2,886 $ 2,646
G & A Expense $ 1,112 $ 854 $ 697 $ 680 $ 706 $ 767
Total Shares and
Units Outstanding
- Wtd. Avg. 22,050,967 21,238,186 20,714,889 20,461,533 18,973,232 18,882,000
========== ========== ========== ========== ========== ==========
<PAGE>
Amli Residential Properties Trust
Selected Quarterly Financial Information - CONTINUED
June 30, 1998
(dollars in thousands except for share data)
Quarter Ending
---------------------------------------------------------------------------------
Jun. 30, Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31,
1998 1998 1997 1997 1997 1997
-------- -------- -------- -------- -------- --------
Interest Coverage Ratio 3.76 3.35 4.01 5.33 4.46 4.73
Debt as % of Total
Market Capitalization 40.52% 41.69% 41.68% 32.90% 34.68% 33.62%
Debt as % of Total
Market Capitalization (1) 44.73% 45.53% 45.69% 37.55% 39.34% 38.38%
EBITDA as % of Total
Market Capitalization 8.68% 7.63% 7.71% 7.80% 7.50% 7.62%
FFO as % of Total
Market Equity 10.61% 9.08% 9.79% 9.35% 8.82% 8.83%
G&A as % of Total
Market Capitalization 0.53% 0.39% 0.35% 0.38% 0.41% 0.47%
G&A as % of Total Revenues 3.79% 3.20% 2.80% 2.96% 3.31% 3.68%
Dividends as % of FFO (5) 74.1% 81.9% 80.1% 80.4% 82.5% 84.3%
Dividends as % of FAD (5) 81.3% 88.3% 85.1% 87.3% 89.9% 95.9%
======== ======== ======== ======== ======== ========
Apartment Units -
Wholly Owned
In Operation 12,250 11,938 11,650 10,782 10,364 9,824
Under Development 2,100 2,488 2,488 2,032 2,296 2,444
Apartment Units -
Co-Investments
In Operation 6,123 5,851 5,851 5,421 4,815 4,815
Under Development 2,224 1,456 1,456 1,370 1,324 1,324
-------- -------- -------- -------- -------- --------
Total Units 22,697 21,733 21,445 19,605 18,799 18,407
======== ======== ======== ======== ======== ========
<FN>
(1) Including proportionate share of debt of Co-investment partnerships accounted for using the equity
method.
(2) End of the quarter - At June 30, 1998, includes 3,183,333 preferred shares convertible to common shares.
(3) Excluding non-recurring gain of $2,457 in 1997.
(4) Includes other income, net of G & A expenses.
(5) Based on per share amounts.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
PORTFOLIO INDEBTEDNESS SUMMARY
June 30, 1998
(Dollars in thousands)
<CAPTION>
Percent Weighted Avg. Years to
Type of Indebtedness Balance of Total Interest Interest Rate Maturity
- -------------------- -------- -------- -------- ------------- --------
<S> <C> <C> <C> <C> <C>
Conventional Fixed Rate $190,108 56.4% Fixed 7.61% 7.8
Tax-exempt Variable
Rate (1) 50,250 14.9% Variable 4.98% 4.3
Credit Facilities (2) 91,000 27.0% Variable 6.96% 3.0
Service Companies 5,750 1.7% Fixed 9.22% 3.9
-------- -------- -------- --------
$337,108 100.0% 7.07% 5.9
======== ======== ======== ========
Balance
including
share of
Co-investment Percent Weighted Avg. Years to
Type of Indebtedness debt (3) of Total Interest Interest Rate Maturity
- -------------------- ------------- -------- -------- ------------- --------
Conventional Fixed Rate $253,485 63.3% fixed 7.67% 7.5
Tax-exempt Variable Rate 50,250 12.6% Variable 4.98% 4.3
Credit Facilities 91,000 22.7% Variable 6.96% 3.0
Service Companies 5,750 1.4% Fixed 9.22% 3.9
-------- -------- -------- --------
$400,485 100.0% 7.19% 6.0
======== ======== ======== ========
<FN>
(1) Maturity Date shown is expiration date of Credit Enhancement. Bonds mature in 2024.
(2) $50,000 has been swapped to a fixed rate ($20,000 maturing in November 2002 and $30,000 maturing in February
2003).
(3) Co-Investment debt represent Amli Residential's pro rate share of debt. Interest rate and maturity reflect
average numbers based on Amli's pro rate share.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
DEBT MATURITIES
JUNE 30, 1998
Unaudited - dollars in thousands
<CAPTION>
There- % to
1998 1999 2000 2001 2002 after Total Total
-------- -------- -------- -------- -------- -------- -------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Fixed Rate Mortgages $ 7,772 $ 2,780 $ 3,138 $ 3,394 $ 3,655 $169,369 $190,108 56.4%
Tax Exempt Bonds* 50,250 50,250 14.9%
Wachovia/First Chicago
Line of Credit 90,000 90,000 26.7%
Harris Line of Credit 1,000 1,000 0.3%
Other 750 5,000 5,750 1.7%
-------- -------- -------- -------- -------- -------- -------- -------
Total Loans $ 9,522 $ 2,780 $ 3,138 $ 93,394 $ 53,905 $174,369 $337,108 100.0%
======== ======== ======== ======== ======== ======== ======== =======
Percent to Total 2.8% 0.8% 0.9% 27.7% 16.0% 51.8% 100.0% 84.2%
======== ======== ======== ======== ======== ======== ======== =======
SHARE OF CO-INVESTMENT DEBT
Prudential Ins. -
Park Place (25%) 27 3,054 0 0 0 0 3,081 4.9%
Nationwide Life Ins. -
Greenwood Forest (15%) 8 17 19 20 1,678 0 1,742 2.7%
Lincoln National Ins. -
Champions Park (15%) 10 21 22 24 1,259 0 1,336 2.1%
Prudential Ins. -
Champions Centre (15%) 5 10 11 12 955 0 993 1.6%
Allstate Life Ins. -
Windbrooke (15%) 9 16 18 20 22 1,635 1,720 2.7%
CIGNA -
Chevy Chase (33%) 84 177 189 202 216 8,770 9,638 15.2%
Northwestern Mutual Life Ins. -
Willowbrook (40%) 71 150 162 175 189 8,909 9,656 15.2%
Phoenix Mutual -
Willeo Creek (30%) 25 53 56 60 64 2,690 2,948 4.7%
Northwestern Mutual Life Ins. -
Pleasant Hill (40%) 37 80 88 96 106 5,701 6,108 9.6%
Northwestern Mutual Life Ins. -
Barrett Lakes (35%) 0 71 77 84 91 5,515 5,838 9.2%
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
DEBT MATURITIES - CONTINUED
There- % to
1998 1999 2000 2001 2002 after Total Total
-------- -------- -------- -------- -------- -------- -------- -------
Erie Insurance -
River Park (40%) 0 20 51 55 60 3,024 3,210 5.1%
Prudential Ins. -
Amli at Danada (10%) 0 17 25 27 29 2,352 2,450 3.9%
Phoenix Home Life -
Amli at Verandah (35%) 0 55 88 94 102 5,590 5,929 9.3%
Northwestern Mutual Life
Ins. - Northwinds (35%) 0 0 15 95 103 4,359 4,572 7.2%
Northwestern Mutual Life
Ins. - Regents Crest (25%) 45 65 70 76 82 3,695 4,033 6.4%
Central Bank, Trustee -
Prairie Court (1%) 0 73 0 0 0 0 73 0.1%
Erie Insurance -
Towne Creek (1%) 0 50 0 0 0 0 50 0.1%
-------- -------- -------- -------- -------- -------- -------- -------
Total Share of
Co-Investment Loans $ 321 $ 3,929 $ 891 $ 1,040 $ 4,956 $ 52,240 $ 63,377 100.0%
======== ======== ======== ======== ======== ======== ======== =======
Percent to Total 0.5% 6.2% 1.4% 1.6% 7.8% 82.5% 100.0% 15.8%
======== ======== ======== ======== ======== ======== ======== =======
Total Including Share
of Co-Investment Debt $ 9,843 $ 6,709 $ 4,029 $ 94,434 $ 58,861 $226,609 $400,485 100.0%
======== ======== ======== ======== ======== ======== ======== =======
Percent to Total 2.5% 1.7% 1.0% 23.6% 14.7% 56.5% 100.0% 100.0%
======== ======== ======== ======== ======== ======== ======== =======
<FN>
* The Spring Creek Bonds mature in October 2024, but the credit enhancement expires on October 15, 2002.
* The Poplar Creek Bonds mature in February 2024, but credit enhancement expires December 18, 2002.
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES)
THREE MONTHS ENDED JUNE 30, 1998 VERSUS THREE MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
<CAPTION>
4/1/98-6/30/98 4/1/97-6/30/97
No. of --------------------------------- % --------------------------------
Apts. Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
WEIGHTED AVG.
OCCUPANCY
- --------------
Dallas 4,226 94.9% 0.9% 94.1%
Atlanta 2,420 93.8% -0.6% 94.3%
Austin 935 96.1% 2.6% 93.7%
Indianapolis 996 94.9% 1.9% 93.2%
Kansas 908 92.7% 0.1% 92.5%
Chicago 253 96.2% 4.1% 92.4%
----- ----- ----- -----
Weighted Average 94.6% 0.8% 93.8%
===== ===== =====
Total 9,738
=====
WEIGHTED AVG. RENTAL RATE
- -------------------------
Dallas $668 3.1% $648
Atlanta $741 2.0% $726
Austin $653 1.9% $641
Indianapolis $580 1.1% $574
Kansas $659 2.3% $644
Chicago $944 3.1% $916
---- ---- ----
Weighted Average $682 2.5% $666
==== ==== ====
TOTAL PROPERTY REVENUES Per Month Per Month
- ----------------------- ---------- ----------
Dallas 4,226 $ 8,422,335 $ 664 $0.79 3.4% $ 8,143,438 $625 $0.76
Atlanta 2,420 $ 5,291,725 $ 729 $0.78 2.4% $ 5,169,299 $712 $0.76
Austin 935 $ 1,860,374 $ 663 $0.90 5.1% $ 1,770,870 $631 $0.86
Indianapolis 996 $ 1,739,440 $ 582 $0.71 1.6% $ 1,712,114 $573 $0.70
Kansas 908 $ 1,759,438 $ 646 $0.75 2.6% $ 1,715,036 $630 $0.73
Chicago 253 $ 790,606 $1,042 $1.22 11.6% $ 708,357 $933 $1.09
----- ----------- ------ ----- ----- ----------- ---- -----
Total 9,738 $19,863,917 $ 680 $0.80 3.4% $19,219,115 $651 $0.77
===== =========== ===== ===== ===== =========== ==== =====
<PAGE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES) - CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97)
4/1/98-6/30/98 4/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
PROPERTY OPERATING EXPENSES (ANNUALIZED) (ANNUALIZED)
- --------------------------- ------------ ------------
Dallas $ 3,681,601 $3,485 $4.16 8.7% $3,388,190 $3,279 $3.97
Atlanta $ 1,897,445 $3,136 $3.36 4.7% $1,812,350 $2,996 $3.21
Austin $ 764,157 $3,269 $4.44 -12.0% $ 868,710 $3,716 $5.05
Indianapolis $ 673,051 $2,703 $3.28 6.6% $ 631,542 $2,536 $3.08
Kansas $ 724,453 $3,191 $3.71 3.4% $ 700,383 $3,085 $3.59
Chicago $ 437,602 $6,919 $8.09 -0.5% $ 439,931 $6,955 $8.14
------------ ------ ----- ----- ---------- ------ -----
Total $ 8,178,309 $3,359 $3.94 4.3% $7,841,106 $3,252 $3.83
============ ====== ===== ===== ========== ====== =====
Operating Efficiency 41.2% 40.8%
============ ==========
</TABLE>
<TABLE>
<CAPTION>
PER MONTH PER MONTH
--------- ----------
NOI 1998% 1997%
- --- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dallas 56.3% 58.4% $ 4,740,734 $374 $0.45 -0.3% $ 4,755,248 $352 $0.43
Atlanta 64.1% 64.9% $ 3,394,279 $468 $0.50 1.1% $ 3,356,949 $462 $0.50
Austin 58.9% 50.9% $ 1,096,217 $391 $0.53 21.5% $ 902,161 $322 $0.44
Indianapolis 61.3% 63.1% $ 1,066,390 $357 $0.43 -1.3% $ 1,080,572 $362 $0.44
Kansas 58.8% 59.2% $ 1,034,985 $380 $0.44 2.0% $ 1,014,653 $372 $0.43
Chicago 44.6% 37.9% $ 353,004 $465 $0.54 31.5% $ 268,426 $354 $0.41
----- ----- ------------ ---- ----- ----- ----------- ---- -----
Total 58.8% 59.2% $ 11,685,608 $400 $0.47 2.7% $11,378,009 $380 $0.45
===== ===== ============ ==== ===== ===== =========== ==== =====
Operating Margin 58.8% 59.2%
============ ===========
CAPITAL EXPENDITURES (ANNUALIZED) (ANNUALIZED)
- -------------------- ------------ ------------
Dallas $ 370,636 $351 $0.42 19.8% $ 309,336 $302 $0.37
Atlanta $ 216,414 $358 $0.38 14.5% $ 189,002 $312 $0.33
Austin $ 145,569 $623 $0.85 45.8% $ 99,832 $427 $0.58
Indianapolis $ 72,738 $292 $0.35 50.5% $ 48,328 $194 $0.24
Kansas $ 112,327 $495 $0.58 97.0% $ 57,017 $251 $0.29
Chicago $ 23,660 $374 $0.42 -23.7% $ 30,993 $490 $0.57
------------ ---- ----- ------ ---------- ---- -----
Total $ 941,345 $387 $0.45 28.2% $ 734,508 $306 $0.36
============ ==== ===== ====== ========== ==== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES) - CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97
<CAPTION>
4/1/98-6/30/98 4/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
REPAIRS AND MAINTENANCE (ANNUALIZED) (ANNUALIZED)
- ----------------------- ------------ ------------
Dallas $ 578,528 $ 548 $0.65 7.2% $ 539,688 $ 564 $0.68
Atlanta $ 259,716 $ 429 $0.46 -3.7% $ 269,727 $ 446 $0.48
Austin $ 107,178 $ 459 $0.62 -45.0% $ 194,867 $ 834 $1.13
Indianapolis $ 108,031 $ 434 $0.53 -13.5% $ 124,861 $ 501 $0.61
Kansas $ 99,691 $ 439 $0.51 1.3% $ 98,451 $ 434 $0.50
Chicago $ 88,900 $1,406 $1.64 -3.9% $ 92,545 $1,463 $1.71
------------ ------ ----- ------ ---------- ------ -----
Total $ 1,242,044 $ 510 $0.60 -5.9% $1,320,139 $ 565 $0.67
============ ====== ===== ====== ========== ====== =====
REAL ESTATE TAXES (ANNUALIZED) (ANNUALIZED)
- ----------------- ------------ ------------
Dallas $ 1,226,910 $1,161 $1.39 15.5% $1,062,345 $1,021 $1.23
Atlanta $ 413,256 $ 683 $0.73 6.4% $ 388,360 $ 642 $0.69
Austin $ 239,898 $1,026 $1.39 11.4% $ 215,406 $ 922 $1.25
Indianapolis $ 157,084 $ 631 $0.77 -8.4% $ 171,447 $ 689 $0.84
Kansas $ 187,654 $ 827 $0.96 -11.8% $ 212,667 $ 937 $1.09
Chicago $ 153,051 $2,420 $2.83 2.5% $ 149,376 $2,362 $2.76
------------ ------ ----- ----- ---------- ------ -----
Total $ 2,377,853 $ 977 $1.15 8.1% $2,199,601 $ 909 $1.07
============ ====== ===== ===== ========== ====== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES)
SIX MONTHS ENDED JUNE 30, 1998 VERSUS SIX MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
<CAPTION>
1/1/98-6/30/98 1/1/97-6/30/97
No. of --------------------------------- % --------------------------------
Apts. Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
------ -------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
WEIGHTED AVG. OCCUPANCY
- -----------------------
Dallas 4,226 94.8% 1.0% 93.8%
Atlanta 2,420 93.7% -0.3% 93.9%
Austin 935 95.9% 2.5% 93.6%
Indianapolis 996 92.4% -0.2% 92.5%
Kansas 908 92.6% -0.2% 92.8%
Chicago 253 97.2% 5.8% 91.8%
------ ----- ----- -----
Weighted Average 94.2% 0.7% 93.5%
Total 9,738 ===== ===== =====
======
WEIGHTED AVG. RENTAL RATE
- -------------------------
Dallas $665 3.1% $645
Atlanta $735 1.2% $726
Austin $648 0.6% $644
Indianapolis $573 0.0% $573
Kansas $651 1.1% $644
Chicago $933 1.2% $922
---- ---- ----
Weighted Average $677 1.8% $665
==== ==== ====
TOTAL PROPERTY REVENUES PER MONTH PER MONTH
- ----------------------- --------- ---------
Dallas 4,226 $16,788,252 $ 662 $0.79 4.5% $16,059,750 $633 $0.76
Atlanta 2,420 $10,463,295 $ 721 $0.77 1.1% $10,345,112 $712 $0.76
Austin 935 $ 3,662,515 $ 653 $0.89 3.0% $ 3,556,164 $634 $0.86
Indianapolis 996 $ 3,350,142 $ 561 $0.68 -0.5% $ 3,365,322 $563 $0.68
Kansas 908 $ 3,465,431 $ 636 $0.74 1.4% $ 3,419,188 $628 $0.73
Chicago 253 $ 1,572,752 $1,036 $1.21 11.7% $ 1,407,407 $927 $1.08
------ ----------- ------ ----- ----- ---------- ---- -----
Total $39,302,388 $ 673 $0.79 3.0% $38,152,942 $653 $0.77
9,738 =========== ====== ===== ===== =========== ==== =====
======
<PAGE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES)
SIX MONTHS ENDED JUNE 30, 1998 VERSUS SIX MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
1/1/98-6/30/98 1/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
PROPERTY OPERATING EXPENSES (ANNUALIZED) (ANNUALIZED)
- --------------------------- ------------ -----------
Dallas $ 7,160,372 $3,389 $4.05 6.6% $ 6,715,381 $3,178 $3.80
Atlanta $ 3,727,695 $3,081 $3.30 0.3% $ 3,717,700 $3,072 $3.29
Austin $ 1,551,090 $3,318 $4.51 -6.5% $ 1,659,321 $3,549 $4.82
Indianapolis $ 1,233,680 $2,477 $3.01 1.3% $ 1,218,178 $2,446 $2.97
Kansas $ 1,319,776 $2,907 $3.38 2.1% $ 1,292,822 $2,848 $3.31
Chicago $ 869,294 $6,872 $8.04 -1.0% $ 877,886 $6,940 $8.12
------------ ------ ----- ----- ----------- ------ -----
Total $ 15,861,907 $3,258 $3.82 2.5% $15,481,289 $3,180 $3.73
============ ====== ===== ===== =========== ====== =====
Operating Efficiency 40.4% 40.6%
===== =====
</TABLE>
<TABLE>
<CAPTION>
PER MONTH PER MONTH
1998 1997 --------- ----------
NOI % %
- --- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dallas 57.3% 58.2% $ 9,627,880 $380 $0.45 3.0% $ 9,344,369 $369 $0.44
Atlanta 64.4% 64.1% $ 6,735,600 $464 $0.50 1.6% $ 6,627,411 $456 $0.49
Austin 57.6% 53.3% $ 2,111,425 $376 $0.51 11.3% $ 1,896,842 $338 $0.46
Indianapolis 63.2% 63.8% $ 2,116,462 $354 $0.43 -1.4% $ 2,147,144 $359 $0.44
Kansas 61.9% 62.2% $ 2,145,655 $394 $0.46 0.9% $ 2,126,365 $390 $0.45
Chicago 44.7% 37.6% $ 703,459 $463 $0.54 32.8% $ 529,521 $349 $0.41
----- ----- ------------ ---- ----- ----- ----------- ---- -----
Total 59.6% 59.4% $ 23,440,481 $401 $0.47 3.4% $22,671,653 $388 $0.46
===== ===== ============ ==== ===== ===== =========== ==== =====
Operating Margin 59.6% 59.4%
===== =====
<PAGE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED PROPERTIES)
SIX MONTHS ENDED JUNE 30, 1998 VERSUS SIX MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
1/1/98-6/30/98 1/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
CAPITAL EXPENDITURES (ANNUALIZED) (ANNUALIZED)
- -------------------- ------------- ------------
Dallas $ 781,079 $370 $0.44 -23.1% $1,016,225 $481 $0.57
Atlanta $ 386,050 $319 $0.34 16.3% $ 332,075 $274 $0.29
Austin $ 199,523 $427 $0.58 21.7% $ 163,890 $351 $0.48
Indianapolis $ 99,702 $200 $0.24 8.9% $ 91,513 $184 $0.22
Kansas $ 171,422 $378 $0.44 105.9% $ 83,274 $183 $0.21
Chicago $ 53,106 $420 $0.49 -40.7% $ 89,520 $708 $0.83
------------ ---- ----- ------ ---------- ---- -----
Total $ 1,690,882 $347 $0.41 -4.8% $1,776,496 $365 $0.43
============ ==== ===== ====== ========== ==== =====
REPAIRS AND MAINTENANCE (ANNUALIZED) (ANNUALIZED)
- ----------------------- ------------ ------------
Dallas $ 995,389 $ 471 $0.56 0.9% $ 986,194 $ 467 $0.56
Atlanta $ 516,025 $ 426 $0.46 -0.3% $ 517,355 $ 428 $0.46
Austin $ 217,449 $ 465 $0.63 -28.7% $ 304,971 $ 652 $0.89
Indianapolis $ 214,730 $ 431 $0.52 -10.7% $ 240,431 $ 483 $0.59
Kansas $ 180,637 $ 398 $0.46 -0.9% $ 182,262 $ 401 $0.47
Chicago $ 165,668 $1,310 $1.53 -4.9% $ 174,211 $1,377 $1.61
------------ ------ ----- ----- ---------- ------ -----
Total $ 2,289,898 $ 470 $0.55 -4.8% $2,405,424 $ 494 $0.58
============ ====== ===== ===== ========== ====== =====
REAL ESTATE TAXES (ANNUALIZED) (ANNUALIZED)
- ----------------- ------------ ------------
Dallas $ 2,450,756 $1,160 $1.39 16.3% $2,107,604 $ 997 $1.19
Atlanta $ 826,512 $ 683 $0.73 0.0% $ 826,521 $ 683 $0.73
Austin $ 479,796 $1,026 $1.39 11.4% $ 430,812 $ 922 $1.25
Indianapolis $ 267,752 $ 538 $0.65 -21.9% $ 342,894 $ 689 $0.84
Kansas $ 375,307 $ 827 $0.96 -11.8% $ 425,334 $ 937 $1.09
Chicago $ 306,102 $2,420 $2.83 2.5% $ 298,752 $2,362 $2.76
------------ ------ ----- ----- ---------- ------ -----
Total $ 4,706,224 $ 967 $1.13 6.2% $4,431,917 $ 910 $1.07
============ ====== ===== ==== ========== ====== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES)
THREE MONTHS ENDED JUNE 30, 1998 VERSUS THREE MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
<CAPTION>
4/1/98-6/30/98 4/1/97-6/30/97
No. of --------------------------------- % --------------------------------
Apts. Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
WEIGHTED AVG.
OCCUPANCY
- --------------
Dallas 4,226 94.9% 0.9% 94.1%
Atlanta 3,314 93.9% -0.7% 94.5%
Austin 1,523 95.4% 1.8% 93.7%
Houston 754 96.0% 1.2% 94.8%
Indianapolis 996 94.9% 1.9% 93.2%
Kansas 908 92.7% 0.1% 92.5%
Chicago 1,694 96.0% 1.8% 94.3%
----- ----- ----- -----
Weighted Average 94.8% 0.8% 94.0%
===== ===== =====
Total 13,415
======
WEIGHTED AVG. RENTAL RATE
- -------------------------
Dallas $668 3.1% $648
Atlanta $748 1.1% $739
Austin $626 1.4% $617
Houston $750 6.2% $706
Indianapolis $580 1.1% $574
Kansas $659 2.3% $644
Chicago $953 3.7% $919
---- ---- ----
Weighted Average $716 2.5% $699
==== ==== ====
TOTAL PROPERTY REVENUES Per Month Per Month
- ----------------------- ---------- ----------
Dallas $ 8,422,335 $ 664 $0.79 3.4% $ 8,143,438 $642 $0.77
Atlanta $ 7,345,015 $ 739 $0.77 1.2% $ 7,256,913 $730 $0.76
Austin $ 2,881,594 $ 631 $0.88 3.7% $ 2,778,322 $608 $0.85
Houston $ 1,720,970 $ 761 $0.82 7.8% $ 1,595,781 $705 $0.76
Indianapolis $ 1,739,440 $ 582 $0.71 1.6% $ 1,712,114 $573 $0.70
Kansas $ 1,759,438 $ 646 $0.75 2.6% $ 1,715,036 $630 $0.73
Chicago $ 4,971,427 $ 978 $1.16 5.5% $ 4,713,080 $927 $1.10
----------- ------ ----- ----- ----------- ---- -----
Total $28,840,219 $ 717 $0.83 3.3% $27,914,684 $694 $0.81
=========== ====== ===== ===== =========== ==== =====
<PAGE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES) -
CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97)
4/1/98-6/30/98 4/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
PROPERTY OPERATING EXPENSES (ANNUALIZED) (ANNUALIZED)
- --------------------------- ------------ ------------
Dallas $ 3,681,601 $3,485 $4.15 8.7% $3,388,190 $3,207 $3.82
Atlanta $ 2,688,002 $3,244 $3.38 3.8% $2,589,288 $3,125 $3.26
Austin $ 1,273,322 $3,344 $4.69 -6.2% $1,358,045 $3,567 $5.00
Houston $ 676,952 $3,591 $3.88 9.6% $ 617,720 $3,277 $3.54
Indianapolis $ 673,051 $2,703 $3.28 6.6% $ 631,542 $2,536 $3.08
Kansas $ 724,453 $3,191 $3.71 3.4% $ 700,383 $3,085 $3.59
Chicago $ 2,043,241 $4,825 $5.70 3.4% $1,975,424 $4,665 $5.51
------------ ------ ----- ----- ----------- ------ -----
Total $ 11,760,621 $3,507 $4.08 4.4% $11,260,591 $3,358 $3.90
============ ====== ===== ===== =========== ====== =====
Operating Efficiency 40.8% 40.3%
============ ===========
</TABLE>
<TABLE>
<CAPTION>
PER MONTH PER MONTH
--------- ----------
NOI 1998% 1997%
- --- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dallas 56.3% 58.4% $ 4,740,734 $374 $0.45 -0.3% $ 4,755,248 $375 $0.45
Atlanta 63.4% 64.3% $ 4,657,014 $468 $0.49 -0.2% $ 4,667,625 $469 $0.49
Austin 55.8% 51.1% $ 1,608,271 $352 $0.49 13.2% $ 1,420,277 $311 $0.44
Houston 60.7% 61.3% $ 1,044,018 $462 $0.50 6.7% $ 978,061 $432 $0.47
Indianapolis 61.3% 63.1% $ 1,066,390 $357 $0.43 -1.3% $ 1,080,572 $362 $0.44
Kansas 58.8% 59.2% $ 1,034,985 $380 $0.44 2.0% $ 1,014,653 $372 $0.43
Chicago 58.9% 58.1% $ 2,928,187 $576 $0.68 7.0% $ 2,737,656 $539 $0.64
----- ----- ------------ ---- ----- ----- ----------- ---- -----
Total 59.2% 59.7% $ 17,079,598 $424 $0.49 2.6% $16,654,093 $414 $0.48
===== ===== ============ ==== ===== ===== =========== ==== =====
Operating
Margin 59.2% 59.7%
============ ===========
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES) -
CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97
<CAPTION>
4/1/98-6/30/98 4/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
CAPITAL EXPENDITURES (ANNUALIZED) (ANNUALIZED)
- -------------------- ------------ ------------
Dallas $ 370,636 $351 $0.42 19.8% $ 309,336 $293 $0.35
Atlanta $ 244,114 $295 $0.31 -0.3% $ 244,952 $296 $0.31
Austin $ 227,858 $598 $0.84 43.7% $ 158,611 $417 $0.58
Houston $ 32,668 $173 $0.19 43.9% $ 22,707 $120 $0.13
Indianapolis $ 72,738 $292 $0.35 50.5% $ 48,328 $194 $0.24
Kansas $ 112,327 $495 $0.58 97.0% $ 57,017 $251 $0.29
Chicago $ 181,399 $428 $0.51 123.0% $ 81,331 $192 $0.23
------------ ---- ----- ------ ---------- ---- -----
Total $ 1,241,740 $370 $0.43 34.6% $ 922,283 $275 $0.32
============ ==== ===== ====== ========== ==== =====
REPAIRS AND MAINTENANCE (ANNUALIZED) (ANNUALIZED)
- ----------------------- ------------ ------------
Dallas $ 578,528 $ 548 $0.65 7.2% $ 539,688 $ 511 $0.61
Atlanta $ 363,939 $ 439 $0.46 2.6% $ 354,587 $ 428 $0.45
Austin $ 195,096 $ 512 $0.72 -30.3% $ 280,081 $ 736 $1.03
Houston $ 41,959 $ 223 $0.24 -0.6% $ 42,203 $ 224 $0.24
Indianapolis $ 108,031 $ 434 $0.53 -13.5% $ 124,861 $ 501 $0.61
Kansas $ 99,691 $ 439 $0.51 1.3% $ 98,451 $ 434 $0.50
Chicago $ 306,168 $ 723 $0.85 15.7% $ 264,618 $ 625 $0.74
------------ ------ ----- ------ ---------- ------ -----
Total $ 1,693,412 $ 505 $0.59 -0.6% $1,704,489 $ 508 $0.59
============ ====== ===== ====== ========== ====== =====
REAL ESTATE TAXES (ANNUALIZED) (ANNUALIZED)
- ----------------- ------------ ------------
Dallas $ 1,226,910 $1,161 $1.38 15.5% $1,062,345 $1,006 $1.20
Atlanta $ 593,181 $ 716 $0.75 5.9% $ 559,978 $ 676 $0.70
Austin $ 387,459 $1,018 $1.43 11.1% $ 348,696 $ 916 $1.28
Houston $ 272,580 $1,446 $1.56 67.0% $ 163,252 $ 866 $0.94
Indianapolis $ 157,084 $ 631 $0.77 -8.4% $ 171,447 $ 689 $0.84
Kansas $ 187,654 $ 827 $0.96 -11.8% $ 212,667 $ 937 $1.09
Chicago $ 696,311 $1,644 $1.94 2.9% $ 676,758 $1,598 $1.89
------------ ------ ----- ----- ---------- ------ -----
Total $ 3,521,178 $1,050 $1.22 10.2% $3,195,144 $ 953 $1.11
============ ====== ===== ===== ========== ====== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES)
SIX MONTHS ENDED JUNE 30, 1998 VERSUS SIX MONTHS ENDED JUNE 30, 1997
(Excludes all properties acquired or stabilized after 1/1/97)
<CAPTION>
1/1/98-6/30/98 1/1/97-6/30/97
No. of --------------------------------- % --------------------------------
Apts. Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
WEIGHTED AVG.
OCCUPANCY
- --------------
Dallas 4,226 94.8% 1.0% 93.8%
Atlanta 3,314 93.2% -0.9% 94.1%
Austin 1,523 95.8% 1.8% 94.2%
Houston 754 95.6% 1.7% 93.9%
Indianapolis 996 92.4% -0.2% 92.5%
Kansas 908 92.6% -0.2% 92.8%
Chicago 1,694 96.4% 2.9% 93.7%
----- ----- ----- -----
Weighted Average 94.4% 0.7% 93.7%
===== ===== =====
Total 13,415
======
WEIGHTED AVG. RENTAL RATE
- -------------------------
Dallas $665 3.1% $645
Atlanta $744 0.8% $738
Austin $622 0.2% $621
Houston $743 5.8% $702
Indianapolis $573 0.0% $573
Kansas $651 1.1% $644
Chicago $944 3.5% $912
---- ---- ----
Weighted Average $711 2.1% $697
==== ==== ====
TOTAL PROPERTY REVENUES Per Month Per Month
- ----------------------- ---------- ----------
Dallas $16,788,252 $ 662 $0.79 4.5% $16,059,750 $633 $0.75
Atlanta $14,467,353 $ 728 $0.76 -0.2% $14,493,352 $729 $0.76
Austin $ 5,710,354 $ 625 $0.88 2.3% $ 5,581,225 $611 $0.86
Houston $ 3,378,093 $ 747 $0.81 7.4% $ 3,146,478 $696 $0.75
Indianapolis $ 3,350,142 $ 561 $0.68 -0.5% $ 3,365,322 $563 $0.68
Kansas $ 3,465,431 $ 636 $0.74 1.4% $ 3,419,188 $628 $0.73
Chicago $ 9,830,613 $ 967 $1.14 6.4% $ 9,242,969 $909 $1.07
----------- ------ ----- ----- ----------- ---- -----
Total $56,990,237 $ 708 $0.82 3.0% $55,308,283 $687 $0.80
=========== ====== ===== ===== =========== ==== =====
<PAGE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES) -
CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97)
1/1/98-6/30/98 1/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
PROPERTY OPERATING EXPENSES (ANNUALIZED) (ANNUALIZED)
- --------------------------- ------------ ------------
Dallas $ 7,160,372 $3,389 $4.04 6.6% $ 6,715,381 $3,178 $3.79
Atlanta $ 5,347,793 $3,227 $3.37 1.9% $ 5,250,629 $3,169 $3.30
Austin $ 2,526,067 $3,317 $4.65 -2.4% $ 2,586,925 $3,397 $4.76
Houston $ 1,383,978 $3,671 $3.97 5.7% $ 1,309,054 $3,472 $3.75
Indianapolis $ 1,233,680 $2,477 $3.01 1.3% $ 1,218,178 $2,446 $2.97
Kansas $ 1,319,776 $2,907 $3.38 2.1% $ 1,292,822 $2,848 $3.31
Chicago $ 3,979,860 $4,699 $5.55 3.9% $ 3,828,812 $4,520 $5.34
------------ ------ ----- ----- ----------- ------ -----
Total $ 22,951,526 $3,422 $3.98 3.4% $22,201,801 $3,310 $3.85
============ ====== ===== ===== =========== ====== =====
Operating Efficiency 40.3% 40.1%
============ ===========
</TABLE>
<TABLE>
<CAPTION>
PER MONTH PER MONTH
--------- ----------
NOI 1998% 1997%
- --- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Dallas 57.3% 58.2% $ 9,627,880 $380 $0.45 3.0% $ 9,344,369 $369 $0.44
Atlanta 63.0% 63.8% $ 9,119,561 $459 $0.48 -1.3% $ 9,242,723 $465 $0.48
Austin 55.8% 53.6% $ 3,184,286 $348 $0.49 6.3% $ 2,994,300 $328 $0.46
Houston 59.0% 58.4% $ 1,994,115 $441 $0.48 8.5% $ 1,837,424 $406 $0.44
Indianapolis 63.2% 63.8% $ 2,116,462 $354 $0.43 -1.4% $ 2,147,144 $359 $0.44
Kansas 61.9% 62.2% $ 2,145,655 $394 $0.46 0.9% $ 2,126,365 $390 $0.45
Chicago 59.5% 58.6% $ 5,850,752 $576 $0.68 8.1% $ 5,414,157 $533 $0.63
----- ----- ------------ ---- ----- ----- ----------- ---- -----
Total 59.7% 59.9% $ 34,038,711 $423 $0.49 2.8% $33,106,482 $411 $0.48
===== ===== ============ ==== ===== ===== =========== ==== =====
Operating
Margin 59.7% 59.9%
============ ==========
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES L.P. - "SAME COMMUNITY COMPARISON" (WHOLLY-OWNED AND CO-INVESTMENT PROPERTIES) -
CONTINUED
(Excludes all properties acquired or stabilized after 1/1/97
<CAPTION>
1/1/98-6/30/98 1/1/97-6/30/97
--------------------------------- % --------------------------------
Amount/% Per Unit Per Sq Ft Change Amount/% Per Unit Per Sq Ft
-------- -------- ---------- ------ ---------- -------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
CAPITAL EXPENDITURES (ANNUALIZED) (ANNUALIZED)
- -------------------- ------------ ------------
Dallas $ 781,079 $370 $0.44 -23.1% $1,016,225 $481 $0.57
Atlanta $ 436,161 $263 $0.27 -1.4% $ 442,303 $267 $0.28
Austin $ 297,769 $391 $0.55 23.9% $ 240,312 $316 $0.44
Houston $ 66,200 $176 $0.19 70.4% $ 38,855 $103 $0.11
Indianapolis $ 99,702 $200 $0.24 8.9% $ 91,513 $184 $0.22
Kansas $ 171,422 $378 $0.44 105.9% $ 83,274 $183 $0.21
Chicago $ 250,747 $296 $0.35 48.2% $ 169,201 $200 $0.24
------------ ---- ----- ------ ---------- ---- -----
Total $ 2,103,081 $314 $0.36 1.0% $2,081,682 $310 $0.36
============ ==== ===== ====== ========== ==== =====
REPAIRS AND MAINTENANCE (ANNUALIZED) (ANNUALIZED)
- ----------------------- ------------ ------------
Dallas $ 995,389 $ 471 $0.56 0.9% $ 986,194 $ 467 $0.56
Atlanta $ 736,707 $ 445 $0.46 6.6% $ 691,180 $ 417 $0.43
Austin $ 374,045 $ 491 $0.69 -17.1% $ 450,964 $ 592 $0.83
Houston $ 85,875 $ 228 $0.25 3.3% $ 83,118 $ 220 $0.24
Indianapolis $ 214,730 $ 431 $0.52 -10.7% $ 240,431 $ 483 $0.59
Kansas $ 180,637 $ 398 $0.46 -0.9% $ 182,262 $ 401 $0.47
Chicago $ 580,012 $ 685 $0.81 10.6% $ 524,626 $ 619 $0.73
------------ ------ ----- ------ ---------- ------ -----
Total $ 3,167,394 $ 472 $0.55 0.3% $3,158,776 $ 471 $0.55
============ ====== ===== ====== ========== ====== =====
REAL ESTATE TAXES (ANNUALIZED) (ANNUALIZED)
- ----------------- ------------ ------------
Dallas $ 2,450,756 $1,160 $1.38 16.3% $2,107,604 $ 997 $1.19
Atlanta $ 1,186,362 $ 716 $0.75 1.4% $1,169,754 $ 706 $0.74
Austin $ 774,918 $1,018 $1.43 11.1% $ 697,392 $ 916 $1.28
Houston $ 545,160 $1,446 $1.56 24.3% $ 438,664 $1,164 $1.26
Indianapolis $ 267,752 $ 538 $0.65 -21.9% $ 342,894 $ 689 $0.84
Kansas $ 375,307 $ 827 $0.96 -11.8% $ 425,334 $ 937 $1.09
Chicago $ 1,363,175 $1,609 $1.90 5.0% $1,298,658 $1,533 $1.81
------------ ------ ----- ----- ---------- ------ -----
Total $ 6,963,429 $1,038 $1.21 7.5% $6,480,300 $ 966 $1.12
============ ====== ===== ===== ========== ====== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
PROPERTY INFORMATION
As of June 30, 1998
<CAPTION>
Qtr ended
Jun. 30, 1998
Approx- Average Qtr ended
imate Rental Rates Jun. 30,
Number Rentable Average ------------- 1998
Year Year of Area Unit Size Per Per Average
PROPERTIES Location Acquired Completed Units (Sq Ft) (Sq Ft) Unit Sq Ft Occupancy
- ---------- -------- -------- --------- ------ --------- --------- ---- ----- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
DALLAS/
FT. WORTH, TX
- -------------
Amli:
at Autumn Chase Carrollton, TX 1991 1987/96 450 374,288 832 $704 $0.85 95.4%
at Bent Tree Dallas, TX 1997 1996 300 282,774 943 834 0.88 93.4%
at Bishop's Gate West Plano, TX 1997 1997 266 292,092 1,098 1,027 0.94 96.6%
at Chase Oaks Plano, TX 1994 1986 250 193,736 775 671 0.87 96.7%
at Gleneagles Dallas, TX 1988 1987/97 590 521,302 884 720 0.82 94.4%
on the Green Ft. Worth, TX 1994 1990/93 424 358,560 846 676 0.80 94.8%
at Nantucket Dallas, TX 1988 1986 312 222,208 712 554 0.78 96.2%
of North Dallas Dallas, TX 1989/90 1985/86 1,032 905,590 878 652 0.74 93.3%
at Reflections Irving, TX 1993 1986 212 174,332 822 681 0.83 96.4%
on Rosemeade Dallas, TX 1990 1987 236 205,382 870 662 0.76 95.9%
on Timberglen Dallas, TX 1990 1985 260 201,198 774 603 0.78 94.7%
at Valley Ranch Irving TX 1990 1985 460 389,940 848 707 0.83 96.1%
----- --------- --- ---- ----- ------
Subtotal-Dallas/
Ft. Worth, TX 4,792 4,121,402 860 $698 $0.81 94.9%
----- --------- --- ---- ----- ------
ATLANTA, GA
- -----------
Amli:
at Sope Creek Marietta, GA 1982/83/
95 695 632,393 910 $688 $0.76 95.1%
at Spring Creek Dunwoody, GA 1985/86/
87/89 1,180 1,080,560 916 723 0.79 92.4%
at Vinings Atlanta, GA 1992 1985 208 229,708 1,104 791 0.72 91.5%
at Vinings-
Phase II Atlanta, GA 1997 1985 152 144,532 951 738 0.78 95.0%
at West Paces Atlanta, GA 1993 1992 337 314,707 934 880 0.94 97.1%
at Peachtree City Atlanta, GA 1998 312 305,756 980 828 0.85 89.9%
at Clairmont Atlanta, GA 1998 1988 288 229,335 796 778 0.98 95.4%
------ --------- ----- ---- ----- ------
Subtotal-
Atlanta, GA 3,172 2,936,991 926 $752 $0.81 93.6%
------ --------- ----- ---- ----- ------
<PAGE>
Qtr ended
Jun. 30, 1998
Approx- Average Qtr ended
imate Rental Rates Jun. 30,
Number Rentable Average ------------- 1998
Year Year of Area Unit Size Per Per Average
PROPERTIES Location Acquired Completed Units (Sq Ft) (Sq Ft) Unit Sq Ft Occupancy
- ---------- -------- -------- --------- ------ --------- --------- ---- ----- -----------
AUSTIN, TEXAS
- -------------
Amli:
at the Arboretum Austin, TX 1986 1983 231 178,116 771 $679 $0.88 96.4%
in Great Hills Austin, TX 1991 1985 344 256,892 747 685 0.92 96.0%
at Lantana Ridge Austin, TX 1997 1997 354 311,808 881 797 0.90 94.5%
at Martha's
Vineyard Austin, TX 1992 1986 360 253,328 704 606 0.86 95.9%
----- --------- --- ---- ----- -----
Subtotal-
Austin, TX 1,289 1,000,144 776 $693 $0.89 95.7%
----- --------- --- ---- ----- -----
EASTERN KANSAS
- --------------
Amli:
at Alvamar Lawrence, KS 1994 1989 152 125,800 828 $666 $0.80 93.2%
at Crown Colony Topeka, KS 1994 1986 156 120,984 776 575 0.74 94.9%
at Crown Colony II Topeka, KS 1997 64 51,292 801 639 0.80 91.7%
at Regents Center Overland Park, KS 1994 1991/95 300 274,170 914 730 0.80 92.1%
at Regents
Center II Overland Park, KS 1997 124 123,728 998 776 0.78 89.5%
at Sherwood Topeka, KS 1994 1993 300 260,340 868 628 0.72 91.8%
at Town Center Overland Park, KS 1997 1997 156 176,994 1,135 949 0.84 92.1%
----- --------- ----- ---- ----- -----
Subtotal
-Eastern KS 1,252 1,133,308 905 $705 $0.78 92.2%
----- --------- ----- ---- ----- -----
INDIANAPOLIS, IN
- ----------------
Amli:
at Riverbend Indianapolis, IN 1992/93 1983/85 996 820,712 824 $580 $0.70 94.9%
at Conner Farms Indianapolis, IN 1997 1993 300 324,636 1,082 763 0.71 88.4%
----- --------- ----- ---- ----- -----
Subtotal
-Indianapolis,
IN 1,296 1,145,348 884 $622 $0.70 93.4%
----- --------- ----- ---- ----- -----
<PAGE>
Qtr ended
Jun. 30, 1998
Approx- Average Qtr ended
imate Rental Rates Jun. 30,
Number Rentable Average ------------- 1998
Year Year of Area Unit Size Per Per Average
PROPERTIES Location Acquired Completed Units (Sq Ft) (Sq Ft) Unit Sq Ft Occupancy
- ---------- -------- -------- --------- ------ --------- --------- ---- ----- -----------
CHICAGO, IL
- ------------
Amli:
at Park Sheridan Chicago, IL 1989 1986 253 216,315 855 $944 $1.10 96.2%
at Poplar Creek Chicago, IL 1997 1985 196 178,490 911 925 1.02 95.1%
----- ---------- ----- ---- ----- -----
Subtotal
-Chicago, IL 449 394,805 879 $936 $1.06 95.7%
------ ---------- ----- ---- ----- -----
TOTAL
PROPERTIES 12,250 10,731,998 876 $713 $0.81 94.2%
====== ========== ==== ==== ===== =====
<PAGE>
Qtr ended
Jun. 30, 1998
Approx- Average Qtr ended
imate Rental Rates Jun. 30,
Number Rentable Average ------------- 1998
Year Year of Area Unit Size Per Per Average
PROPERTIES Location Acquired Completed Units (Sq Ft) (Sq Ft) Unit Sq Ft Occupancy
- ---------- -------- -------- --------- ------ --------- --------- ---- ----- -----------
CO-INVESTMENT
PROPERTIES
- --------------
ATLANTA, GA
- -----------
Amli:
at Pleasant Hill Atlanta, GA 1996 502 501,816 1,000 $785 $0.79 93.7%
at Barrett Lakes Atlanta, GA 1997 446 460,150 1,032 849 0.82 94.0%
at River Park Atlanta, GA 1997 222 225,892 1,018 852 0.84 95.9%
at Towne Creek Gainesville, GA 1989 150 121,722 811 618 0.76 94.7%
at Willeo Creek Rosewell, GA 1995 1989 242 297,302 1,229 819 0.67 95.0%
----- --------- ----- ---- ----- ------
Subtotal-
Atlanta, GA 1,562 1,606,882 1,029 $802 $0.78 94.4%
----- --------- ----- ---- ----- ------
CHICAGO, IL
- -----------
Amli:
at Prairie
Court Oak Park, IL 1987 125 105,578 845 1,075 1.27 96.5%
at Windbrooke Buffalo Grove, IL 1995 1987 236 213,160 903 968 1.07 97.2%
at Chevy Chase Buffalo Grove, IL 1996 1988 592 480,676 812 951 1.17 95.7%
at Danada Wheaton, IL 1997 1989/1991 600 521,500 869 915 1.05 95.9%
at Fox Valley 1998 272 269,093 989 925 0.94 72.6%
at Willowbrook Willowbrook, IL 1996 1987 488 418,404 857 921 1.07 95.5%
----- --------- --- ---- ----- -----
Subtotal-
Chicago, IL 2,313 2,008,411 868 $941 $1.08 93.2%
----- --------- --- ---- ----- -----
EASTERN KANSAS
- --------------
AMLI at:
Regents Crest Overland Park, KS 1997 1997 368 346,488 942 $723 $0.77 92.5%
----- --------- --- ---- ----- -----
DALLAS/FT. WORTH
- ----------------
Amli:
at Verandah Arlington, TX 1997 1986/91 538 394,504 733 $669 $0.91 96.2%
----- --------- --- ---- ----- -----
<PAGE>
Qtr ended
Jun. 30, 1998
Approx- Average Qtr ended
imate Rental Rates Jun. 30,
Number Rentable Average ------------- 1998
Year Year of Area Unit Size Per Per Average
PROPERTIES Location Acquired Completed Units (Sq Ft) (Sq Ft) Unit Sq Ft Occupancy
- ---------- -------- -------- --------- ------ --------- --------- ---- ----- -----------
AUSTIN, TX
- ----------
Amli:
at Park Place Austin, TX 1994 1985 588 397,968 677 $582 $0.86 94.3%
------ --------- --- ---- ----- -----
HOUSTON, TX
Amli:
at Champions
Centre Houston, TX 1994 1994 192 164,480 857 $744 $0.87 96.4%
at Champions Park Houston, TX 1994 1991 246 221,646 901 723 0.80 96.7%
at Greenwood
Forest Houston, TX 1995 1995 316 310,844 984 774 0.79 95.1%
---- ------- --- ---- ----- -----
Subtotal-
Houston, TX 754 696,970 924 $750 $0.81 96.0%
---- ---------- --- ---- ----- -----
TOTAL CO-INVESTMENT
PROPERTIES 6,123 5,451,223 890 811 0.91 94.2%
====== ========== === ==== ===== =====
TOTAL 18,373 16,183,221 881 $746 $0.85 94.2%
====== ========== === ==== ===== =====
</TABLE>
<PAGE>
<TABLE>
AMLI RESIDENTIAL PROPERTIES TRUST
COMPONENTS OF PROPERTY EBITDA
<CAPTION>
WHOLLY-OWNED
----------------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
--------------------------------- ---------------------------------
% %
1998 1997 Change 1998 1997 Change
------- ------- ------ ------- ------- ------
<S> <C> <C> <C> <C> <C> <C>
PROPERTY REVENUES
- -----------------
Rental Income
- -------------
Same Store Communities (1). . . . . $18,790 18,256 2.9% 37,237 36,250 2.7%
New Communities (2) . . . . . . . . 787 -- 1,598 --
Development and/or Lease-up
Communities (3). . . . . . . . . . 1,080 321 236.8% 1,747 451 287.2%
Acquisition Communities (4) . . . . 4,341 151 8,524 167
Communities Sold/Contributed
to Ventures (5). . . . . . . . . . 205 553 237 1,093
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $25,204 19,281 30.7% 49,342 37,961 30.0%
======= ======= ======= ======= ======= =======
Other Revenues
- --------------
Same Store Communities. . . . . . . $ 1,073 963 11.4% 2,066 1,903 8.5%
New Communities . . . . . . . . . . 43 -- 89 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 88 25 257.0% 147 35 320.7%
Acquisition Communities . . . . . . 218 1 399 1
Communities Sold/Contributed
to Ventures. . . . . . . . . . . . 34 30 46 55
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $ 1,456 1,019 42.9% 2,748 1,994 37.8%
======= ======= ======= ======= ======= =======
Total Property Revenues
- -----------------------
Same Store Communities. . . . . . . $19,864 19,219 3.4% 39,302 38,153 3.0%
New Communities . . . . . . . . . . 830 -- 1,687 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 1,168 345 238.2% 1,894 486 289.6%
Acquisition Communities . . . . . . 4,559 152 8,924 168
Communities Sold/Contributed
to Ventures. . . . . . . . . . . . 239 583 284 1,148
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $26,660 20,300 31.3% 52,090 39,955 30.4%
======= ======= ======= ======= ======= =======
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
COMPONENTS OF PROPERTY EBITDA - Continued
WHOLLY-OWNED
----------------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
--------------------------------- ---------------------------------
% %
1998 1997 Change 1998 1997 Change
------- ------- ------ ------- ------- ------
Total Operating Expenses
- ------------------------
Same Store Communities . . . . . . $ 8,178 7,841 4.3% 15,862 15,481 2.5%
New Communities . . . . . . . . . . 326 -- 597 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 481 217 121.6% 854 352 142.4%
Acquisition Communities . . . . . . 1,837 50 3,576 54
Communities Sold/Contributed
to Ventures. . . . . . . . . . . . 279 293 402 574
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $11,101 8,400 32.1% 21,291 16,461 29.3%
======= ======= ======= ======= ======= =======
Property EBITDA
- ---------------
Same Store Communities. . . . . . . $11,686 11,378 2.7% 23,440 22,672 3.4%
New Communities . . . . . . . . . . 503 -- 1,090 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 687 128 1,040 134
Acquisition Communities . . . . . . 2,723 103 5,348 114
Communities Sold/Contributed
to Ventures. . . . . . . . . . . . (40) 291 (118) 574
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $15,559 11,900 30.8% 30,800 23,494 31.1%
======= ======= ======= ======= ======= =======
Company's share of
Co-investment EBITDA . . . . . . .
Percent of
Co-investment
EBITDA. . . . . . . . . . . . . . .
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
COMPONENTS OF PROPERTY EBITDA - Continued
CO-INVESTMENTS AT 100%
----------------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
--------------------------------- ---------------------------------
% %
1998 1997 Change 1998 1997 Change
------- ------- ------ ------- ------- ------
PROPERTY REVENUES
- -----------------
Rental Income
- -------------
Same Store Communities (1). . . . . $ 8,517 8,251 3.2% 16,853 16,305 3.4%
New Communities (2) . . . . . . . . 1,623 -- 3,176 --
Development and/or Lease-up
Communities (3). . . . . . . . . . 1,643 694 136.6% 2,705 972 178.5%
Acquisition Communities (4) . . . . 3,342 2,471 35.3% 6,619 3,037 118.0%
Communities Sold/Contributed
to Ventures (5). . . . . . . . . .
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $15,125 11,417 32.5% 29,353 20,314 44.5%
======= ======= ======= ======= ======= =======
Other Revenues
- --------------
Same Store Communities. . . . . . . $ 459 444 835 850
New Communities . . . . . . . . . . 95 -- 159 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 168 52 285 90
Acquisition Communities . . . . . . 239 139 71.6% 432 170 154.1%
Communities Sold/Contributed
to Ventures. . . . . . . . . . . .
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $ 961 636 51.2% 1,711 1,110 54.1%
======= ======= ======= ======= ======= =======
Total Property Revenues
- -----------------------
Same Store Communities. . . . . . . $ 8,976 8,696 3.2% 17,688 17,155 3.1%
New Communities . . . . . . . . . . 1,718 -- 3,335 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 1,811 747 2,990 1,062
Acquisition Communities . . . . . . 3,581 2,610 37.2% 7,050 3,207 119.9%
Communities Sold/Contributed
to Ventures. . . . . . . . . . . .
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $16,086 12,052 33.5% 31,064 21,424 45.0%
======= ======= ======= ======= ======= =======
<PAGE>
AMLI RESIDENTIAL PROPERTIES TRUST
COMPONENTS OF PROPERTY EBITDA - Continued
CO-INVESTMENTS AT 100%
----------------------------------------------------------------------
THREE MONTHS ENDED SIX MONTHS ENDED
JUNE 30, JUNE 30,
--------------------------------- ---------------------------------
% %
1998 1997 Change 1998 1997 Change
------- ------- ------ ------- ------- ------
Total Operating Expenses
- ------------------------
Same Store Communities . . . . . . $ 3,582 3,419 4.8% 7,090 6,721 5.5%
New Communities . . . . . . . . . . 605 -- 1,196 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 896 582 53.9% 1,689 899 87.9%
Acquisition Communities . . . . . . 1,390 1,022 36.0% 2,790 1,171 138.3%
Communities Sold/Contributed
to Ventures. . . . . . . . . . . .
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $ 6,473 5,024 28.9% 12,765 8,790 45.2%
======= ======= ======= ======= ======= =======
Property EBITDA
- ---------------
Same Store Communities. . . . . . . $ 5,394 5,276 2.2% 10,598 10,435 1.6%
New Communities . . . . . . . . . . 1,113 -- 2,140 --
Development and/or Lease-up
Communities. . . . . . . . . . . . 923 164 1,309 163
Acquisition Communities . . . . . . 2,191 1,588 38.0% 4,260 2,037 109.2%
Communities Sold/Contributed
to Ventures. . . . . . . . . . . .
------- ------- ------- ------- ------- -------
Total. . . . . . . . . . . . . . $ 9,621 7,028 36.9% 18,307 12,634 44.9%
======= ======= ======= ======= ======= =======
Company's share of
Co-investment EBITDA . . . . . . . 2,556 1,808 41.3% 4,868 3,279 48.5%
======= ======= ======= ======= ======= =======
Percent of Co-investment
EBITDA. . . . . . . . . . . . . . . 27% 26% 27% 26%
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<FN>
(1) Stabilized Communities at 1/1/97.
(2) Development Communities stabilized after 1/1/97 but before 1/1/98.
(3) Development Communities not yet stabilized.
(4) Stabilized Communities acquired after 1/1/97.
(5) Communities sold or contributed to co-investment ventures.
</TABLE>
