<SEC-DOCUMENT>0000950123-11-051493.txt : 20110518
<SEC-HEADER>0000950123-11-051493.hdr.sgml : 20110518
<ACCEPTANCE-DATETIME>20110518100509
ACCESSION NUMBER:		0000950123-11-051493
CONFORMED SUBMISSION TYPE:	424B5
PUBLIC DOCUMENT COUNT:		3
FILED AS OF DATE:		20110518
DATE AS OF CHANGE:		20110518

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			UDR, Inc.
		CENTRAL INDEX KEY:			0000074208
		STANDARD INDUSTRIAL CLASSIFICATION:	REAL ESTATE INVESTMENT TRUSTS [6798]
		IRS NUMBER:				540857512
		STATE OF INCORPORATION:			MD
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		424B5
		SEC ACT:		1933 Act
		SEC FILE NUMBER:	333-156002
		FILM NUMBER:		11853652

	BUSINESS ADDRESS:	
		STREET 1:		1745 SHEA CENTER DRIVE
		STREET 2:		SUITE 200
		CITY:			HIGHLANDS RANCH
		STATE:			CO
		ZIP:			80129
		BUSINESS PHONE:		720-283-6120

	MAIL ADDRESS:	
		STREET 1:		1745 SHEA CENTER DRIVE
		STREET 2:		SUITE 200
		CITY:			HIGHLANDS RANCH
		STATE:			CO
		ZIP:			80129

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	UNITED DOMINION REALTY TRUST INC
		DATE OF NAME CHANGE:	19920703

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	OLD DOMINION REAL ESTATE INVESTMENT TRUST
		DATE OF NAME CHANGE:	19850110

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	OLD DOMINION REIT ONE
		DATE OF NAME CHANGE:	19770921
</SEC-HEADER>
<DOCUMENT>
<TYPE>424B5
<SEQUENCE>1
<FILENAME>d82419b5e424b5.htm
<DESCRIPTION>424B5
<TEXT>
<HTML>
<HEAD>
<TITLE>e424b5</TITLE>
</HEAD>
<BODY bgcolor="#FFFFFF">
<!-- PAGEBREAK -->
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE style="color: #FF0000" width="100%" border="1" cellpadding="5"><TR><TD style=text-align:justify>
<FONT style="font-size: 8pt; font-family: Arial, Helvetica; color: #E8112D">The
information in this preliminary pricing supplement is not
complete and may be changed. This preliminary pricing supplement
and the accompanying prospectus supplement and prospectus are
not an offer to sell these securities and are not soliciting an
offer to buy these securities in any jurisdiction where the
offer or sale is not permitted.<BR>
</FONT>
</TD></TR></TABLE>

<DIV style="margin-top: 1pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="color: #E8112D">SUBJECT TO COMPLETION</FONT></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="color: #E8112D">Preliminary Pricing Supplement
    Dated May&#160;18, 2011</FONT></B>
</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Filed pursuant to Rule&#160;424(b)(5)
</DIV>

<DIV align="right" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Registration No.&#160;333-156002
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Pricing Supplement</B>
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (To Prospectus dated December&#160;8, 2008
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    and Prospectus Supplement dated May&#160;3, 2011)
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <IMG src="d82419b5d8241900.gif" alt="(UDR LOGO)">
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 24pt">UDR, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 14pt">$&#160;&#160;&#160;&#160;&#160;</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 14pt">Medium-Term Notes,
    Series&#160;A</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Due Nine Months or More From Date of Issue, Fully and
    Unconditionally Guaranteed by United Dominion</I>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Realty, L.P.</I>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes will bear interest at a rate
    of&#160;&#160;&#160;&#160;&#160;% per year. We will pay interest
    on the notes on&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160; of each year. The first
    interest payment will be made
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2011. The notes will mature
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    unless redeemed prior to that date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes will be our senior indebtedness under our senior
    indenture dated November&#160;1, 1995, as amended, supplemented
    or modified from time to time, which we refer to as the
    &#147;indenture&#148; and will be fully and unconditionally
    guaranteed by our subsidiary, United Dominion Realty, L.P., a
    Delaware limited partnership. The notes will not be subject to a
    sinking fund and will not be convertible or exchangeable into
    other securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 12pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Investing in the notes involves risks. See &#147;Risk
    Factors&#148; beginning on
    <FONT style="white-space: nowrap">page&#160;S-3</FONT>
    of the accompanying prospectus supplement dated May&#160;3, 2011
    and on page&#160;1 of the accompanying prospectus dated
    December&#160;8, 2008.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Neither the Securities and Exchange Commission nor any state
    securities commission has approved or disapproved of these
    securities or passed upon the adequacy or accuracy of this
    pricing supplement, the accompanying prospectus and prospectus
    supplement. Any representation to the contrary is a criminal
    offense.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="83%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="2%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="2%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Per Note</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Total</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Public offering price
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Underwriting discount
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Proceeds to us (before expenses)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest will accrue from May&#160;&#160;&#160;, 2011.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The underwriters expect to deliver the notes in book-entry form
    only through the facilities of The Depositary Trust&#160;Company
    against payment in New York, New York on or about
    May&#160;&#160;&#160;, 2011.
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Joint Bookrunning Managers</I>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 18pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="49%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="48%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -18pt; margin-left: 18pt">
    <B>Citi</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    <B>J.P.&#160;Morgan</B>
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="bottom">
    <CENTER style="font-size: 1pt; width: 18%; border-bottom: 1pt solid #000000"></CENTER><BR>
</TD>
</TR>
<TR valign="bottom">
<TD colspan="3" align="center" valign="bottom">
<DIV style="text-indent: -18pt; margin-left: 18pt">
    <I><FONT style="font-size: 10pt">Co-Managers</FONT></I>
</DIV>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -18pt; margin-left: 18pt">
    <B><FONT style="font-size: 14pt">Credit Suisse</FONT></B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD align="right" valign="bottom">
    <B><FONT style="font-size: 14pt">Deutsche Bank Securities
    </FONT></B>
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The date of this pricing supplement is May&#160;&#160;&#160;,
    2011
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">


</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="D82419tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD colspan="5" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Preliminary Pricing Supplement</B>
</DIV>
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419132'>UDR, Inc.&#160;</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    PS-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419133'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    PS-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419134'>Description of Notes</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    PS-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419135'>Plan of Distribution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    PS-4
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="5" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Prospectus Supplement</B>
</DIV>
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419101'>Statement Regarding Forward-Looking
    Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    ii
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419102'>About this Prospectus Supplement</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419103'>Recent Developments</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419104'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419105'>Description of Notes</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419106'>Special Provisions Relating to Foreign Currency
    Notes</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-27
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419107'>Material U.S. Federal Income Tax
    Considerations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-30
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419108'>Plan of Distribution (Conflicts of Interest)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419109'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419110'>Incorporation of Certain Documents By
    Reference</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419111'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419112'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    S-46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD colspan="5" align="center" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <B>Prospectus</B>
</DIV>
</TD>
</TR>
<TR valign="bottom" style="line-height: 6pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419113'>About this Prospectus</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    ii
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419114'>UDR, Inc.&#160;</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419115'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419116'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419117'>Ratio of Earnings to Fixed Charges</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419118'>Description of Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419119'>Description of Capital Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419120'>Description of Debt Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    10
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419121'>Description of Guarantees of the Debt
    Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419122'>Description of Warrants</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419123'>Description of Subscription Rights</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    24
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419124'>Description of Purchase Contracts and Purchase
    Units</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    25
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419125'>Federal Income Tax Considerations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    26
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419126'>Selling Security Holders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419127'>Plan of Distribution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419128'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419129'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419130'>Cautionary Statement Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419131'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="top">
    47
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>You should rely only on the information contained or
    incorporated by reference in this pricing supplement and the
    accompanying prospectus supplement and prospectus. Neither we
    nor any underwriter has authorized any other person to provide
    you with different or additional information. If anyone provides
    you with different or additional information, you should not
    rely on it. Neither we nor the underwriters are making an offer
    to sell the notes in any jurisdiction where the offer or sale is
    not permitted. You should assume that the information contained
    or incorporated by reference in this pricing supplement and the
    accompanying prospectus and prospectus relating to any issuance
    of notes, is accurate only as of the date on the front cover of
    the applicable document. Our business, financial condition,
    results of operations and prospects may have changed since that
    date.</B>
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='D82419132'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">UDR,
    INC.</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    UDR, Inc. is a self administered real estate investment trust,
    or REIT, that owns, acquires, renovates, develops, and manages
    apartment communities nationwide. References in this pricing
    supplement, the accompanying prospectus supplement and
    prospectus to &#147;UDR,&#148; &#147;we,&#148; &#147;us,&#148;
    &#147;our&#148; or &#147;the company&#148; are to UDR, Inc.
    References in this prospectus supplement to &#147;UDR LP&#148;
    or &#147;the guarantor&#148; are to United Dominion Realty, L.P.
</DIV>

<A name='D82419133'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The net proceeds from the sale of the notes are estimated to be
    approximately $&#160;&#160;&#160;&#160;&#160;&#160;million after
    deducting selling discounts and commissions and estimated
    offering expenses. We intend to use the net proceeds for general
    corporate purposes.
</DIV>

<A name='D82419134'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF NOTES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following description of the terms of the Medium-Term Notes,
    Series&#160;A Due Nine Months or More from Date of Issue, fully
    and unconditionally guaranteed by UDR LP, referred to in this
    preliminary pricing supplement as the &#147;notes,&#148;
    supplements, and to the extent inconsistent replaces, the
    description of the general terms and provisions of debt
    securities contained in the accompanying prospectus supplement
    and prospectus. It is important for you to consider the
    information contained in this preliminary pricing supplement and
    the accompanying prospectus supplement and prospectus in making
    your investment decision.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will issue the notes as a series of Debt Securities under an
    indenture, referred to in this pricing supplement as the
    &#147;indenture,&#148; dated as of November&#160;1, 1995, as
    amended, supplemented or modified from time to time, with
    U.S.&#160;Bank National Association, successor trustee to
    Wachovia Bank, National Association (formerly First Union
    National Bank of Virginia), as trustee. The terms of the notes
    include those provisions contained in the indenture, the terms
    of which are more fully described in the accompanying prospectus
    supplement and prospectus and under the section entitled
    &#145;&#145;&#151;&#160;Covenants&#148; below, and those made
    part of the indenture by reference to the Trust&#160;Indenture
    Act of 1939, as amended (the &#147;Trust&#160;Indenture
    Act&#148;). The notes are subject to all of these terms, and
    holders of notes are referred to the indenture and the
    Trust&#160;Indenture Act for a statement of those terms. The
    notes will be our direct, senior unsecured obligations and will
    rank equally with all of our other unsecured and unsubordinated
    indebtedness from time to time outstanding. UDR LP will fully
    and unconditionally guarantee payment in full to the holders of
    the notes. All such payments are subject to the credit risk of
    UDR LP, as the guarantor. Reference is made to the section
    entitled &#147;Description of Debt Securities&#148; in the
    accompanying prospectus, &#147;Description of Notes&#160;&#151;
    Certain Covenants&#148; in the accompanying prospectus
    supplement, and to &#147;&#151;&#160;Covenants&#148; below for a
    description of the covenants applicable to the notes. We will
    issue each note as a book-entry note represented by one or more
    fully registered global securities or as a fully registered
    certificated note. The notes will only be issued in fully
    registered form in denominations of $1,000 and integral
    multiples of $1,000.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Principal
    and Interest</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes will bear interest at the rate
    of&#160;&#160;&#160;&#160;&#160;% per year and will mature
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;.
    The notes will bear interest
    from&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2011 and interest will be payable semi-annually in arrears
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    and&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    of each year, commencing
    on&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    2011 (each such date being an &#147;interest payment date&#148;)
    to the persons in whose name the notes are registered in the
    security register on the
    preceding&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
    or&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;,
    whether or not a business day, as the case may be (each such
    date being a &#147;record date&#148;). Interest on the notes
    will be computed on the basis of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    consisting of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If any interest payment date or the maturity date falls on a day
    that is not a business day, the required payment will be made on
    the next business day as if it were made on the date the payment
    was due and no
</DIV>
<!-- XBRL Paragraph Pagebreak -->
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    PS-1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    interest will accrue on the amount so payable for the period
    from and after the interest payment date or the maturity date,
    as the case may be, until the next business day.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Guarantee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    UDR LP will fully and unconditionally guarantee payment of any
    principal, premium and interest in respect of the notes in full
    to the holders thereof. The guarantee forms part of the
    Indenture under which the notes will be issued. If, for any
    reason, we do not make any required payment in respect of our
    notes when due, UDR LP will cause the payment to be made to, or
    to the order of, the applicable paying agent on behalf of the
    trustee. Holders of our notes may enforce their rights under the
    guarantee directly against UDR LP without first making a demand
    or taking action against UDR or any other person or entity. UDR
    LP may, without the consent of the holders of the notes, assume
    all of our rights and obligations under the notes and, upon such
    assumption, we will be released from our liabilities under the
    Indenture and the notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Covenants</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The section in the accompanying prospectus entitled
    &#147;Description of Debt Securities&#148; and the section in
    the accompanying prospectus supplement entitled
    &#147;Description of Notes&#160;&#151; Certain Covenants&#148;
    describe certain agreements we have made for the benefit of the
    holders of the notes. However, the covenants limiting UDR&#146;s
    incurrence of debt set forth in Section&#160;1004(a) and
    Section&#160;1007 of the indenture, which are described under
    the heading &#147;Description of Debt Securities&#160;&#151;
    Covenants Under the Senior Indenture,&#148; will not apply to
    the notes offered under this pricing supplement. Instead, the
    following covenants will apply to the notes, as discussed in
    more detail under the heading &#147;&#151;&#160;Certain
    Covenants&#148; in the accompanying prospectus supplement
    (capitalized terms not otherwise defined will have the
    respective meanings assigned to them in the indenture):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;The Trust will, and will cause the Subsidiaries to, have
    at all times Total Unencumbered Assets of not less than 150% of
    the aggregate principal amount of all of the Trust&#146;s
    outstanding Unsecured Debt and the outstanding Unsecured Debt of
    the Subsidiaries, determined on a consolidated basis in
    accordance with GAAP.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Trust will not, and will not permit any Subsidiary to, incur
    any Debt if, immediately after giving effect to the incurrence
    of such additional Debt and the application of the proceeds
    thereof, the aggregate principal amount of all outstanding Debt
    of the Trust and its Subsidiaries on a consolidated basis
    determined in accordance with GAAP is greater than 65% of the
    sum of (without duplication) (i)&#160;the Trust&#146;s Total
    Assets as of the end of the calendar quarter covered in the
    Trust&#146;s Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    or Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q,</FONT>
    as the case may be, most recently filed with the Commission (or,
    if such filing is not permitted under the Exchange Act, with the
    Trustee) prior to the incurrence of such additional Debt and
    (ii)&#160;the purchase price of any real estate assets or
    mortgages receivable acquired, and the amount of any securities
    offering proceeds received (to the extent such proceeds were not
    used to acquire real estate assets or mortgages receivable or
    used to reduce Debt), by the Trust or any Subsidiary since the
    end of such calendar quarter, including those proceeds obtained
    in connection with the incurrence of such additional Debt.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#145;Total Unencumbered Assets&#146; means the sum of, without
    duplication, those Undepreciated Real Estate Assets which are
    not subject to a lien securing Debt and all other assets,
    excluding accounts receivable and intangibles, of the Trust and
    the Subsidiaries not subject to a lien securing Debt, all
    determined on a consolidated basis in accordance with GAAP;
    provided, however, that all investments by the Trust and the
    Subsidiaries in unconsolidated joint ventures, unconsolidated
    limited partnerships, unconsolidated limited liability companies
    and other unconsolidated entities shall be excluded from Total
    Unencumbered Assets to the extent that such investments would
    have otherwise been included.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Optional
    Redemption</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may redeem all or part of the notes at any time at our option
    at a redemption price equal to the greater of (1)&#160;the
    principal amount of the notes being redeemed plus accrued and
    unpaid interest to the redemption date or (2)&#160;the
    Make-Whole Amount for the notes being redeemed.
</DIV>
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    <BR>
    PS-2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Make-Whole Amount&#148; means, as determined by the
    Quotation Agent, the sum of the present values of the principal
    amount of the notes to be redeemed, together with the scheduled
    payments of interest (exclusive of interest to the redemption
    date) from the redemption date to the maturity date of the notes
    being redeemed, in each case discounted to the redemption date
    on a semi-annual basis, assuming a
    <FONT style="white-space: nowrap">360-day</FONT> year
    consisting of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months, at the Adjusted Treasury Rate, plus accrued and unpaid
    interest on the principal amount of the notes being redeemed to
    the redemption date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Adjusted Treasury Rate&#148; means, with respect to any
    redemption date, the sum of (x)&#160;either (1)&#160;the yield
    for the maturity corresponding to the Comparable Treasury Issue,
    under the heading that represents the average for the
    immediately preceding week, appearing in the most recent
    published statistical release designated &#147;H.15 (519)&#148;
    or any successor publication that is published weekly by the
    Board of Governors of the Federal Reserve System and that
    establishes yields on actively traded United States Treasury
    securities adjusted to constant maturity under the caption
    &#147;Treasury Constant Maturities&#148; (provided, if no
    maturity is within three months before or after the remaining
    term of the notes being redeemed, yields for the two published
    maturities most closely corresponding to the Comparable Treasury
    Issue will be determined and the Adjusted Treasury Rate will be
    interpolated or extrapolated from such yields on a straight line
    basis, rounded to the nearest month) or (2)&#160;if such release
    (or any successor release) is not published during the week
    preceding the calculation date or does not contain such yields,
    the rate per year equal to the semi-annual equivalent yield to
    maturity of the Comparable Treasury Issue, calculated using a
    price for the Comparable Treasury Issue (expressed as a
    percentage of its principal amount) equal to the Comparable
    Treasury Price for such redemption date, in each case calculated
    on the third business day preceding the redemption date, and
    (y)&#160;&#160;&#160;&#160;&#160;%.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Comparable Treasury Issue&#148; means the United States
    Treasury security selected by the Quotation Agent as having a
    maturity comparable to the remaining term from the redemption
    date to the maturity date of the notes being redeemed that would
    be utilized, at the time of selection and in accordance with
    customary financial practice, in pricing new issues of corporate
    debt securities of comparable maturity to the remaining term of
    the notes being redeemed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Comparable Treasury Price&#148; means, with respect to any
    redemption date, (x)&#160;the average of three Reference
    Treasury Dealer Quotations for such redemption date, after
    excluding the highest and lowest Reference Treasury Dealer
    Quotations so obtained, or (y)&#160;if fewer than five Reference
    Treasury Dealer Quotations are so obtained, the average of all
    such Reference Treasury Dealer Quotations so obtained.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Quotation Agent&#148; means the Reference Treasury Dealer
    selected by the indenture trustee after consultation with UDR,
    Inc.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Reference Treasury Dealer&#148; means any of Citigroup
    Global Markets Inc., J.P.&#160;Morgan Securities LLC, Credit
    Suisse Securities (USA) LLC, Deutsche Bank Securities Inc.,
    their respective successors and assigns and one other nationally
    recognized investment banking firms selected by UDR, Inc. that
    is a primary U.S.&#160;Government securities dealer.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Reference Treasury Dealer Quotations&#148; means, with
    respect to each Reference Treasury Dealer and any redemption
    date, the average, as determined by the indenture trustee, of
    the bid and asked prices for the Comparable Treasury Issue
    (expressed in each case as a percentage of its principal amount)
    quoted in writing to the indenture trustee by such Reference
    Treasury Dealer at 5:00&#160;p.m., New York City time, on the
    third business day preceding such redemption date.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    PS-3
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<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='D82419135'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">PLAN OF
    DISTRIBUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Subject to the terms and conditions stated in the second amended
    and restated distribution agreement dated May&#160;3, 2011, the
    underwriters named below have severally agreed to purchase, and
    we have agreed to sell to each underwriter, the respective
    principal amount of notes set forth opposite the
    underwriter&#146;s name.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="88%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="8%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Principal<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom">
    <B>Amount of<BR>
    </B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="left" valign="bottom">
<DIV style="border-bottom: 1px solid #000000; width: 1%; padding-bottom: 1px">
    <B>Underwriter</B>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="2" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Notes</B>
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Citigroup Global Markets Inc.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    J.P. Morgan Securities LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Credit Suisse Securities (USA) LLC
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Deutsche Bank Securities Inc.&#160;
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="font-size: 1pt">
<TD>
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD style="border-top: 1px solid #000000">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
</TR>
<TR valign="bottom" style="background: #CCEEFF">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 20pt">
    Total
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    $
</TD>
<TD nowrap align="right" valign="bottom">

</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The second amended and restated distribution agreement provides
    that the obligations of the underwriters to purchase the notes
    included in this offering are subject to approval of legal
    matters by counsel and to other conditions. The underwriters are
    obligated to purchase all the notes if they purchase any of the
    notes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The underwriters propose to offer some of the notes directly to
    the public at the public offering price set forth on the cover
    page of this pricing supplement and some of the notes to dealers
    at the public offering price less a concession not to
    exceed&#160;&#160;&#160;&#160;&#160;% of the principal amount of
    the notes. The underwriters may allow, and dealers may reallow,
    a concession not to exceed&#160;&#160;&#160;&#160;&#160;% of the
    principal amount of the notes on sales to other dealers. After
    the initial offering of the notes to the public, the
    underwriters may change the public offering price and
    concessions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following table shows the underwriting discounts and
    commissions that we are to pay to the underwriters in connection
    with this offering (expressed as a percentage of the principal
    amount of the notes).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="91%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="3%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="3%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom">
    <B>Paid by<BR>
    </B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>UDR, Inc.</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Per note
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#160;&#160;&#160;&#160;&#160;
</TD>
<TD nowrap align="left" valign="bottom">
    %
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In connection with the offering, the underwriters may purchase
    and sell notes in the open market. These transactions may
    include over-allotment, syndicate covering transactions and
    stabilizing transactions. Over-allotment involves syndicate
    sales of notes in excess of the principal amount of notes to be
    purchased by the underwriters in the offering, which creates a
    syndicate short position. Syndicate covering transactions
    involve purchases of the notes in the open market after the
    distribution has been completed in order to cover syndicate
    short positions. Stabilizing transactions consist of certain
    bids or purchases of notes made for the purpose of preventing or
    retarding a decline in the market price of the notes while the
    offering is in progress.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The underwriters also may impose a penalty bid. Penalty bids
    permit the underwriters to reclaim a selling concession from a
    syndicate member when, in covering syndicate short positions or
    making stabilizing purchases, the underwriters repurchase notes
    originally sold by that syndicate member.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any of these activities may have the effect of preventing or
    retarding a decline in the market price of the notes. They may
    also cause the price of the notes to be higher than the price
    that otherwise would exist in the open market in the absence of
    these transactions. The underwriters may conduct these
    transactions in the
    <FONT style="white-space: nowrap">over-the-counter</FONT>
    market or otherwise. If the underwriters commence any of these
    transactions, they may discontinue them at any time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We estimate that our total expenses for this offering will be
    approximately $&#160;&#160;&#160;&#160;&#160; . The underwriters
    or their affiliates have performed investment banking and
    advisory services for us from time to time for which they have
    received customary fees and expenses. The underwriters and their
    affiliates may, from time to time, engage in transactions with
    and perform services for us in the ordinary course of their
    business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We have agreed to indemnify the underwriters against certain
    liabilities, including liabilities under the Securities Act of
    1933, as amended, or to contribute to payments the underwriters
    may be required to make because of any of those liabilities.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    PS-4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Prospectus Supplement</B>
</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (To Prospectus dated December&#160;8, 2008)
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <IMG src="d82419b5d8241900.gif" alt="(UDR LOGO)">
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 24pt">UDR, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I><FONT style="font-size: 14pt">Medium-Term Notes,
    Series&#160;A</FONT></I></B>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I><FONT style="font-size: 12pt">Due Nine Months or More from
    Date of Issue,</FONT></I>
</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I><FONT style="font-size: 12pt">Fully and Unconditionally
    Guaranteed by United Dominion Realty, L.P.</FONT></I>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following terms will generally apply to the medium-term
    notes that we will sell from time to time using this prospectus
    supplement and the attached prospectus.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="3%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Ranking as senior indebtedness under the company&#146;s senior
    indenture and fully and unconditionally guaranteed by our
    subsidiary, United Dominion Realty, L.P., a Delaware limited
    partnership
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Mature nine months or more from the date of issue
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    May be subject to redemption at our option or repurchase at the
    option of the holder
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Fixed or floating interest rate. The floating interest rate
    formula may be based on:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="9%"></TD>
    <TD width="3%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    CD rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    CMT rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    Commercial paper rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    Eleventh district cost of funds rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    Federal funds rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    LIBOR
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    Prime rate
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#9675;&#160;
</TD>
    <TD align="left">
    Treasury rate
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="3%"></TD>
    <TD width="91%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Another rate or formula set forth in the applicable pricing
    supplement
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Fixed rate notes may bear no interest when issued at a discount
    from the principal amount due at maturity
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Certificated or book-entry form
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Payments in U.S.&#160;dollars or one or more foreign currencies
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Interest paid on fixed rate notes and floating rate notes will
    be paid on the dates specified in the pricing supplement
</TD>
</TR>


<TR style="line-height: 2pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Minimum denominations of $1,000 and integral multiples of
    $1,000, or other specified denominations for foreign currencies
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The final terms of each note will be specified in the applicable
    pricing supplement which may be different from the terms
    described in this prospectus supplement.
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Investing in the notes involves risks. See &#147;Risk
    Factors&#148; beginning on
    <FONT style="white-space: nowrap">page&#160;S-3</FONT>
    of this prospectus supplement and on page&#160;1 of the
    accompanying prospectus.</B>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Neither the Securities and Exchange Commission nor any state
    securities commission has approved or disapproved of these
    securities or passed upon the adequacy or accuracy of this
    prospectus supplement, the accompanying prospectus or any
    pricing supplement. Any representation to the contrary is a
    criminal offense.</B>
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    the pricing terms of the notes will be:
</DIV>

<DIV style="margin-top: 2pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="26%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="23%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="23%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="23%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    <B>Price to Public</B>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    <B>Agents&#146; Commission</B>
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    <B>Proceeds to Us</B>
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 60pt">
    Per note
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="bottom">
    100%
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    .125% - .750%
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="bottom">
    99.875% - 99.250%
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 6%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may sell notes to the agents referred to below as principal
    for resale at varying or fixed offering prices or through the
    agents as agent using their reasonable efforts on our behalf. We
    may also sell notes without the assistance of any agent.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="1%%" align="center" nowrap>
    <B>BofA Merrill Lynch</B>
</TD>
<TD width="99%%">
&nbsp;
</TD>
</TR>
</TABLE>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="15%">
&nbsp;
</TD>
<TD width="7%" align="center" nowrap>
    <B>&#160;&#160;&#160;&#160;&#160;&#160;&#160;Citi</B>
</TD>
<TD width="78%">
&nbsp;
</TD>
</TR>
</TABLE>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="31%">
&nbsp;
</TD>
<TD width="25%" align="center" nowrap>
    <B>Deutsche Bank Securities</B>
</TD>
<TD width="44%">
&nbsp;
</TD>
</TR>
</TABLE>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="46%">
&nbsp;
</TD>
<TD width="12%" align="center" nowrap>
    <B>J.P. Morgan</B>
</TD>
<TD width="42%">
&nbsp;
</TD>
</TR>
</TABLE>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="62%">
&nbsp;
</TD>
<TD width="15%" align="center" nowrap>
    <B>Morgan Stanley</B>
</TD>
<TD width="23%">
&nbsp;
</TD>
</TR>
</TABLE>
<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<TR>
<TD width="99%%">
&nbsp;
</TD>
<TD width="1%%" align="center" nowrap>
    <B>Wells Fargo Securities</B>
</TD>
</TR>
</TABLE>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The date of this prospectus supplement is May&#160;3, 2011
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 94%; margin-left: 3%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->
</DIV><!-- END PAGE WIDTH -->
<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Prospectus
    Supplement</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="D82419tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="95%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B><U>Page</U></B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419101'>Statement Regarding Forward-Looking
    Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    ii
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419102'>About this Prospectus Supplement</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419103'>Recent Developments</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419104'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-3
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419105'>Description of Notes</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-5
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419106'>Special Provisions Relating to Foreign Currency
    Notes</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-27
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419107'>Material U.S. Federal Income Tax
    Considerations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-30
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419108'>Plan of Distribution (Conflicts of Interest)</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-43
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419109'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419110'>Incorporation of Certain Documents By
    Reference</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-44
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419111'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419112'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    S-46
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>

<DIV style="margin-top: 9pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Prospectus</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="D82419tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="96%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419113'>About this Prospectus</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    ii
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419114'>UDR, Inc.&#160;</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419115'>Risk Factors</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419116'>Use of Proceeds</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419117'>Ratio of Earnings to Fixed Charges</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419118'>Description of Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419119'>Description of Capital Stock</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419120'>Description of Debt Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419121'>Description of Guarantees of the Debt
    Securities</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419122'>Description of Warrants</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419123'>Description of Subscription Rights</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419124'>Description of Purchase Contracts and Purchase
    Units</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419125'>Federal Income Tax Considerations</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419126'>Selling Security Holders</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419127'>Plan of Distribution</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419128'>Legal Matters</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419129'>Experts</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419130'>Cautionary Statement Regarding Forward-Looking
    Statements</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#D82419131'>Where You Can Find More Information</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    i
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='D82419101'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">STATEMENT
    REGARDING FORWARD-LOOKING INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus supplement, the accompanying prospectus and the
    documents incorporated by reference in this prospectus
    supplement and the accompanying prospectus, include statements
    about future events and expectations that constitute
    forward-looking statements. Such forward-looking statements
    include, without limitation, statements concerning property
    acquisitions and dispositions, development activity and capital
    expenditures, capital raising activities, rent growth,
    occupancy, and rental expense growth. Words such as
    &#147;expects,&#148; &#147;anticipates,&#148;
    &#147;intends,&#148; &#147;plans,&#148; &#147;believes,&#148;
    &#147;seeks,&#148; &#147;estimates,&#148; and variations of such
    words and similar expressions are intended to identify such
    forward-looking statements. Such statements involve known and
    unknown risks, uncertainties and other factors which may cause
    the actual results, performance or achievements to be materially
    different from the results of operations or plans expressed or
    implied by such forward-looking statements. Such factors
    include, among other things, unanticipated adverse business
    developments affecting us or our properties, adverse changes in
    the real estate markets and general and local economies and
    business conditions. Although we believe that the assumptions
    underlying such forward-looking statements are reasonable, any
    of the assumptions could be inaccurate, and therefore such
    statements may not prove to be accurate. In light of the
    significant uncertainties inherent in the forward-looking
    statements included herein, the inclusion of such information
    should not be regarded as a representation by us or any other
    person that the results or conditions described in such
    statements or our objectives and plans will be achieved.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following factors, among others, could cause our future
    results to differ materially from those expressed in the
    forward-looking statements:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    general economic factors;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    unfavorable changes in apartment market and economic conditions
    that could adversely affect occupancy levels and rental rates;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the failure of acquisitions to achieve anticipated results;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    possible difficulty in selling apartment communities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    competitive factors that may limit our ability to lease
    apartment homes or increase or maintain rents;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    insufficient cash flow that could affect our debt financing and
    create refinancing risk;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    failure to generate sufficient revenue, which could impair our
    debt service payments and reduce distributions to stockholders;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    development and construction risks that may impact our
    profitability;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    potential damage from natural disasters, including hurricanes
    and other weather-related events, which could result in
    substantial costs to us;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    risks from extraordinary losses for which we may not have
    insurance or adequate reserves;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    uninsured losses due to insurance deductibles, self-insurance
    retention, uninsured claims or casualties, or losses in excess
    of applicable coverage;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    delays in completing developments and
    <FONT style="white-space: nowrap">lease-ups</FONT> on
    schedule;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our failure to succeed in new markets;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changing interest rates, which could increase interest costs and
    affect the market price of our securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    potential liability for environmental contamination, which could
    result in substantial costs to us;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the imposition of federal taxes if we fail to qualify as a REIT
    under the Internal Revenue Code in any taxable year;
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    ii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our internal control over financial reporting may not be
    considered effective which could result in a loss of investor
    confidence in our financial reports, and in turn have an adverse
    effect on our stock price;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    changes in real estate laws, tax laws and other laws affecting
    our business.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Please also refer to the section entitled &#147;Risk
    Factors&#148; in our Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the fiscal year ended December&#160;31, 2010 and our
    Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    for the fiscal quarter ended March&#160;31, 2011 for further
    information on these and other risks affecting us.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We caution you not to place undue reliance on forward-looking
    statements because our future results may differ materially from
    those expressed or implied by them. We do not intend to update
    any forward-looking statement, whether written or oral, relating
    to the matters discussed in this prospectus supplement and the
    accompanying prospectus, except as required by law.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    iii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='D82419102'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">ABOUT
    THIS PROSPECTUS SUPPLEMENT</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    From time to time, we intend to use this prospectus supplement,
    the accompanying prospectus, and a related pricing supplement to
    offer the Medium-Term Notes, Series&#160;A, Due Nine Months or
    More from Date of Issue, Fully and Unconditionally Guaranteed by
    United Dominion Realty, L.P., which we refer to, along with the
    related guarantee offered under this prospectus supplement, as
    the &#147;notes.&#148; We refer to the guarantee offered under
    this prospectus supplement as the &#147;guarantee.&#148; You
    should read each of these documents before investing in the
    notes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus supplement describes additional terms of the
    notes and supplements the description of our debt securities
    contained in the accompanying prospectus. If the information in
    this prospectus supplement is inconsistent with the accompanying
    prospectus, this prospectus supplement will supersede the
    information in the prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus supplement and the accompanying prospectus do
    not constitute an offer to sell or the solicitation of an offer
    to buy the notes in any jurisdiction in which that offer or
    solicitation is unlawful. The distribution of this prospectus
    supplement and the accompanying prospectus and the offering of
    the notes in some jurisdictions may be restricted by law. If you
    have received this prospectus supplement and the accompanying
    prospectus, you should find out about and observe these
    restrictions. Persons outside the United States who come into
    possession of this prospectus supplement and the accompanying
    prospectus must inform themselves about and observe any
    restrictions relating to the distribution of this prospectus
    supplement and the accompanying prospectus and the offering of
    the notes outside of the United States. See &#147;Plan of
    Distribution.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus supplement and the accompanying prospectus have
    been prepared on the basis that any offer of notes in any member
    state of the European Economic Area (each, a &#147;Relevant
    Member State&#148;) which has implemented the Prospectus
    Directive (2003/71/EC) (the &#147;Prospectus Directive&#148;)
    will be made pursuant to an exemption under the Prospectus
    Directive, as implemented in that Relevant Member State, from
    the requirement to publish a prospectus for offers of notes.
    Accordingly, any person making or intending to make an offer in
    that Relevant Member State of any notes which are contemplated
    in this prospectus supplement and the accompanying prospectus
    may only do so in circumstances in which no obligation arises
    for us or any of the selling agents to publish a prospectus
    pursuant to Article&#160;3 of the Prospectus Directive or
    supplement a prospectus pursuant to Article&#160;16 of the
    Prospectus Directive, in each case, in relation to such offer.
    Neither we nor the selling agents have authorized, and neither
    we nor they authorize, the making of any offer of notes in
    circumstances in which an obligation arises for us or any
    selling agent to publish or supplement a prospectus for such
    offer. Neither this prospectus supplement nor the accompanying
    prospectus constitutes an approved prospectus for the purposes
    of the Prospective Directive.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    For each offering of notes, we will issue a pricing supplement
    which will contain additional terms of the offering and a
    specific description of the notes being offered. The pricing
    supplement also may add, update, or change information in this
    prospectus supplement or the accompanying prospectus, including
    provisions describing the calculation of interest and the method
    of making payments under the terms of a note. We will state in
    the pricing supplement the interest rate or interest rate basis
    or formula, issue price, any relevant index or indices or other
    reference asset, the maturity date, interest payment dates,
    redemption or repayment provisions, if any, and other relevant
    terms and conditions for each note at the time of issuance. The
    pricing supplement also may include a discussion of any risk
    factors or other special additional considerations that apply to
    a particular type of note. The pricing supplement can be quite
    detailed and always should be read carefully.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any term that is used, but not defined, in this prospectus
    supplement has the meaning set forth in the accompanying
    prospectus. Effective March&#160;14, 2007, we changed our
    corporate name from United Dominion Realty Trust, Inc. to UDR,
    Inc. References in this prospectus supplement to
    &#147;UDR,&#148; &#147;we,&#148; &#147;us,&#148; &#147;our&#148;
    or &#147;the company&#148; are to UDR, Inc. References in this
    prospectus supplement to &#147;UDR LP&#148; or &#147;the
    guarantor&#148; are to United Dominion Realty, L.P.
</DIV>
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    <BR>
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<A name='D82419103'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">RECENT
    DEVELOPMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    On September&#160;30, 2010, UDR LP, a Delaware limited
    partnership and a subsidiary of UDR, guaranteed certain
    outstanding securities of UDR. These guarantees, including the
    guarantee offered under this prospectus supplement, provide that
    UDR LP, as primary obligor and not merely as surety, irrevocably
    and unconditionally guarantees to each holder of the applicable
    securities and to the trustee and their successors and assigns
    under the respective indenture (a)&#160;the full and punctual
    payment when due, whether at stated maturity, by acceleration or
    otherwise, of all obligations of UDR under the respective
    indenture whether for principal of or interest on the securities
    (and premium, if any), and all other monetary obligations of UDR
    under the respective indenture and the terms of the applicable
    securities and (b)&#160;the full and punctual performance within
    the applicable grace periods of all other obligations of UDR
    under the respective indenture and the terms of the applicable
    securities.
</DIV>
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    <BR>
    S-2
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='D82419104'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Investing in the notes involves risks. Before investing in the
    notes, you should carefully consider, among other matters, the
    risk factors below and information set forth under the heading
    &#147;Risk Factors&#148; in our most recent Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    and Quarterly Reports on
    <FONT style="white-space: nowrap">Form&#160;10-Q,</FONT>
    which are incorporated by reference into this prospectus
    supplement and the accompanying prospectus, as the same may be
    updated from time to time by filings under the Exchange Act that
    we incorporate by reference herein.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Notes
    Indexed to Interest Rate, Currency or Other Indices or Formulas
    May Have Risks Not Associated with a Conventional Debt
    Security</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If you invest in notes indexed, as to principal, premium, if
    any, <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, to one or more interest rate, currency or
    other indices or formulas, you will be subject to significant
    risks not associated with similar investments in a conventional
    fixed rate or floating rate debt security. These risks include,
    without limitation, fluctuation of the particular indices or
    formulas and the possibility that you will receive a lower, or
    no, amount of principal, premium or interest and at different
    times than you expected. We have no control over a number of
    factors, including economic, financial and political events,
    that are important in determining the existence, magnitude and
    longevity of these risks and their results. In addition, if an
    index or formula used to determine any amounts payable in
    respect of the notes contains a multiplier or leverage factor,
    the effect of any change in the particular index or formula will
    be magnified. In recent years, values of certain indices and
    formulas have been volatile and volatility in those and other
    indices and formulas may be expected in the future. However,
    past experience is not necessarily indicative of fluctuations
    that may occur in the future.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Redemption&#160;May
    Adversely Affect Your Return on the Notes</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If your notes are redeemable at our option, we may choose to
    redeem your notes at times when prevailing interest rates are
    relatively low. In addition, if your notes are subject to
    mandatory redemption, we may be required to redeem your notes
    also at times when prevailing interest rates are relatively low.
    As a result, you generally will not be able to reinvest the
    redemption proceeds in a comparable security at an effective
    interest rate as high as the current interest rate on the notes
    being redeemed.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">There May
    Not Be a Trading Market for Your Notes; Many Factors Affect the
    Trading and Market Value of Your Notes</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon issuance, your notes will not have an established trading
    market. A trading market for your notes may not develop or be
    maintained if developed. In addition to our creditworthiness,
    many factors affect the trading market for, and trading value
    of, your notes. These factors include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the complexity and volatility of the index or formula applicable
    to your notes,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the method of calculating the principal, premium and interest in
    respect of your notes,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the time remaining to the maturity of your notes,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the outstanding amount of notes related to your notes,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any redemption features of your notes,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the amount of other debt securities linked to the index or
    formula applicable to your notes,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the level, direction and volatility of market interest rates
    generally.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    There may be a limited number of buyers when you decide to sell
    your notes. This may affect the price you receive for your notes
    or your ability to sell your notes at all. In addition, notes
    that are designed for specific investment objectives or
    strategies often experience a more limited trading market and
    more price volatility than those not so designed. You should not
    purchase any notes unless you understand and are able to bear
    the risk that the notes may not be readily saleable, that the
    value of the notes will fluctuate over time and that these
    fluctuations may be significant.
</DIV>
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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Foreign
    Currency Notes are Subject to Exchange Rate and Exchange Control
    Risks</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If you invest in notes that are denominated
    <FONT style="white-space: nowrap">and/or</FONT>
    payable in a currency other than U.S.&#160;dollars, referred to
    in this prospectus supplement as &#147;foreign currency
    notes,&#148; you will be subject to significant risks not
    associated with an investment in a debt security denominated and
    payable in U.S.&#160;dollars, including, without limitation, the
    possibility of material changes in the exchange rate between
    U.S.&#160;dollars and the applicable foreign currency and the
    possibility of the imposition or modification of exchange
    controls by the applicable governments or monetary authorities.
    We have no control over the factors that generally affect these
    risks, including economic, financial and political events and
    the supply and demand for the applicable currencies. Moreover,
    if payments on your foreign currency notes are determined by
    reference to a formula containing a multiplier or leverage
    factor, the effect of any change in the exchange rates between
    the applicable currencies will be magnified. In recent years,
    exchange rates between U.S.&#160;dollars and certain currencies
    have been highly volatile and volatility between these
    currencies or with other currencies should be expected in the
    future. Fluctuations in any particular exchange rate that have
    occurred in the past are not necessarily indicative, however, of
    fluctuations that may occur in the future. Depreciation of the
    currency applicable to your foreign currency notes against the
    U.S.&#160;dollar would result in a decrease in the
    U.S.&#160;dollar equivalent yield of your foreign currency
    notes, in the U.S.&#160;dollar equivalent value of the principal
    and any premium payable at maturity or any earlier redemption of
    your foreign currency notes and, generally, in the
    U.S.&#160;dollar equivalent market value of your foreign
    currency notes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Governmental or monetary authority exchange controls could
    affect exchange rates and the availability of the payment
    currency for your foreign currency notes on a required payment
    date. Even if there are no exchange controls, it is possible
    that the currency in which your foreign currency rates are
    payable will not be available on a required payment date due to
    circumstances beyond our control. In these cases, we will be
    allowed to satisfy our obligations in respect of your foreign
    currency notes in U.S.&#160;dollars.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Investors
    in the Notes Assume the Credit Risk of UDR and UDR LP in the
    Event that UDR Defaults on its Obligations Under the Notes;
    UDR&#146;s Credit Ratings May Not Reflect All Risks of an
    Investment in the Notes</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes are issued by UDR and guaranteed by UDR LP, UDR&#146;s
    subsidiary. As a result, investors in the notes assume the
    credit risk of UDR and UDR LP in the event that UDR defaults on
    its obligations under the notes. This means that if UDR and UDR
    LP become insolvent, default or are otherwise unable to pay
    their obligations under the notes, you could lose some or all of
    your initial principal investment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The credit ratings assigned to our medium-term note program may
    not reflect the potential impact of all risks related to
    structure and other factors on any trading market for, or
    trading value of, your notes. In addition, real or anticipated
    changes in UDR&#146;s credit ratings will generally affect any
    trading market for, or trading value of, your notes.
    Accordingly, you should consult your own financial and legal
    advisors as to the risks entailed by an investment in the notes
    and the suitability of investing in the notes in light of your
    particular circumstances.
</DIV>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='D82419105'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF NOTES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following description of the terms of the notes supplements,
    and to the extent inconsistent replaces, the description of the
    general terms and provisions of debt securities contained in the
    accompanying prospectus. The pricing supplement for each
    offering of an issue of notes will contain the specific
    information and terms for that offering. The pricing supplement
    may also add, update or change information contained in the
    accompanying prospectus and this prospectus supplement. It is
    important for you to consider the information contained in the
    accompanying prospectus, this prospectus supplement and any
    pricing supplement in making your investment decision.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will issue the notes as a series of Debt Securities under an
    indenture, referred to in this prospectus supplement as the
    &#147;Indenture,&#148; dated as of November&#160;1, 1995, as
    amended, supplemented or modified from time to time, with
    U.S.&#160;Bank National Association, successor trustee to
    Wachovia Bank, National Association (formerly First Union
    National Bank of Virginia), as trustee. The Indenture is subject
    to, and governed by, the Trust&#160;Indenture Act of 1939, as
    amended. The following summary of certain provisions of the
    notes, including the guarantee, and the Indenture does not
    purport to be complete and is qualified in its entirety by
    reference to the actual provisions of the notes, including the
    guarantee, and the Indenture. Capitalized terms used but not
    defined in this prospectus supplement shall have the meanings
    given to them in the accompanying prospectus, the notes,
    including the guarantee, or the Indenture, as the case may be.
    The term &#147;Debt Securities,&#148; as used in this prospectus
    supplement, refers to all debt securities issued and issuable
    from time to time under the Indenture, including the notes
    offered by this prospectus supplement, as well as the guarantee.
    The following description of notes will apply to each note
    offered hereby unless otherwise specified in the applicable
    pricing supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    All of our Debt Securities that we have issued or will issue
    under the Indenture, including the notes offered hereby, will be
    our unsecured general obligations and will rank equally with all
    of our other unsecured and unsubordinated indebtedness from time
    to time outstanding. UDR LP will fully and unconditionally
    guarantee payment in full to the holders of our Debt Securities,
    including the notes offered hereby. All such payments are
    subject to the credit risk of UDR LP, as the guarantor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Indenture does not limit the aggregate principal amount of
    Debt Securities that we may issue thereunder. Accordingly, we
    may issue Debt Securities from time to time in one or more
    series up to the aggregate initial offering price authorized by
    us for the particular series. We may, from time to time, without
    the consent of the registered holders of the notes offered
    hereby, issue medium-term notes that are part of the same series
    as the notes or other Debt Securities under the Indenture in
    addition to the notes offered hereby.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    notes that bear interest will either be fixed rate notes or
    floating rate notes, as specified in the applicable pricing
    supplement. We may also issue discount notes, indexed notes and
    amortizing notes, as specified in the applicable pricing
    supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each note will mature on any day nine months or more from its
    date of issue, referred to herein as the &#147;stated maturity
    date,&#148; as specified in the applicable pricing supplement,
    unless the principal thereof (or, any installment of principal
    thereof) becomes due and payable prior to the stated maturity
    date, whether, as applicable, by the declaration of acceleration
    of maturity, notice of redemption at our option, notice of the
    registered holder&#146;s option to elect repayment or otherwise
    (the stated maturity date or any date prior to the stated
    maturity date on which the particular note becomes due and
    payable, as the case may be, is referred to as the
    &#147;maturity date&#148; with respect to the principal of the
    particular note repayable on that date).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    the notes will be denominated in, and payments of principal,
    premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, in respect thereof will be made in,
    U.S.&#160;dollars. The notes also may be denominated in, and
    payments of principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, in respect thereof may be made in, one or more
    foreign currencies. Unless otherwise specified in the applicable
    pricing supplement, payments in respect of foreign currency
    notes will be made in the currency in which those foreign
    currency notes are denominated. See &#147;Special Provisions
    Relating to Foreign
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Currency Notes&#151;Payment of Principal, Premium, if any, and
    Interest, if any.&#148; The currency in which a note is
    denominated (or, if that currency is no longer legal tender for
    the payment of public and private debts in the country issuing
    that currency which is then legal tender) is referred to as the
    &#147;Specified Currency&#148; with respect to the particular
    note. References to &#147;U.S.&#160;dollars&#148; or
    &#147;$&#148; are to the lawful currency of the United States of
    America.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    you will be required to pay for your notes in the Specified
    Currency. At the present time, there are limited facilities in
    the United States for the conversion of U.S.&#160;dollars into
    foreign currencies and vice versa, and commercial banks do not
    generally offer
    <FONT style="white-space: nowrap">non-U.S.&#160;dollar</FONT>
    checking or savings account facilities in the United States. The
    agent from or through which a foreign currency note is purchased
    may be prepared to arrange for the conversion of
    U.S.&#160;dollars into the Specified Currency to enable you to
    pay for your foreign currency note, provided that you make a
    request to that agent on or prior to the fifth business day (as
    defined below) preceding the date of delivery of the particular
    foreign currency note, or by any other day determined by that
    agent. Each conversion will be made by an agent on the terms and
    subject to the conditions, limitations and charges as that agent
    may from time to time establish in accordance with its regular
    foreign exchange practices. You will be required to bear all
    costs of exchange in respect of your foreign currency note. For
    more information, see &#147;Special Provisions Relating to
    Foreign Currency Notes&#148; below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest rates that we offer on the notes may differ depending
    upon, among other factors, the aggregate principal amount of
    notes purchased in any single transaction. Notes with different
    variable terms other than interest rates may also be offered
    concurrently to different investors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may change interest rates or formulas and other terms of
    notes from time to time, but no change of terms will affect any
    note we have previously issued or as to which we have accepted
    an offer to purchase.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will issue each note as a book-entry note represented by one
    or more fully registered global securities or as a fully
    registered certificated note. Unless otherwise specified in the
    applicable pricing supplement, the minimum denominations of each
    note other than a foreign currency note will be $1,000 and
    integral multiples of $1,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will make payments of principal of, and premium, if any, and
    interest, if any, on, book-entry notes represented by global
    securities through the trustee to The Depositary
    Trust&#160;Company or its successor or assigns, referred to in
    this prospectus supplement as the &#147;Depositary.&#148; In the
    case of certificated notes, we will make payments of principal
    and premium, if any, due on the maturity date in immediately
    available funds upon presentation and surrender thereof (and, in
    the case of any repayment on an optional repayment date, upon
    submission of a duly completed election form if and as required
    by the provisions described below) at the office or agency
    maintained by us for this purpose in the Borough of Manhattan,
    The City of New York, currently the corporate trust office of
    the trustee located at 40 Broad Street, 5th&#160;Floor, New
    York, New York 10004. We will make payments of interest, if any,
    due on the maturity date of a certificated note to the person to
    whom payment of the principal thereof and premium, if any,
    thereon shall be made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will make payments of interest, if any, on a certificated
    note due on any Interest Payment Date (as defined below) other
    than the maturity date by check mailed to the address of the
    registered holder entitled thereto appearing in the security
    register. Notwithstanding the foregoing, we will make payments
    of interest, if any, due on any Interest Payment Date other than
    the maturity date to each registered holder of $10,000,000 (or,
    if the Specified Currency is other than U.S.&#160;dollars, the
    equivalent thereof in the particular Specified Currency) or more
    in aggregate principal amount of certificated notes (whether
    having identical or different terms and provisions) by wire
    transfer of immediately available funds if the applicable
    registered holder has delivered appropriate wire transfer
    instructions in writing to the trustee not less than
    15&#160;days prior to the particular Interest Payment Date. Any
    wire transfer instructions received by the trustee shall remain
    in effect until revoked by the applicable registered holder. For
    special payment terms applicable to foreign currency notes, see
    &#147;Special Provisions Relating to Foreign Currency
    Notes&#151;&#160;Payment of Principal, Premium, if any, and
    Interest, if any.&#148;
</DIV>
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    <BR>
    S-6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The term &#147;business day&#148; means any day, other than a
    Saturday or Sunday, that is neither a legal holiday nor a day on
    which commercial banking institutions are authorized or required
    by law, regulation or executive order to close in The City of
    New York; provided, however, that, with respect to foreign
    currency notes, the day must also not be a day on which
    commercial banking institutions are authorized or required by
    law, regulation or executive order to close in the Principal
    Financial Center (as defined below) of the country issuing the
    Specified Currency (or, if the Specified Currency is Euro, the
    day must also be a day on which the Trans-European Automated
    Real-Time Gross Settlement Express Transfer (TARGET) System is
    open); provided, further, that, with respect to notes as to
    which LIBOR is an applicable Interest Rate Basis, the day must
    also be a London Banking Day (as defined below).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;London Banking Day&#148; means a day on which commercial
    banking institutions are open for business (including dealings
    in the Designated LIBOR Currency (as defined below) are
    transacted in the London interbank market.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Principal Financial Center&#148; means, as applicable:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the capital city of the country issuing the Specified
    Currency;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the capital city of the country to which the Designated LIBOR
    Currency relates;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    provided, however, that with respect to U.S.&#160;dollars,
    Australian dollars, Canadian dollars, Euros, South African rand
    and Swiss francs, the &#147;Principal Financial Center&#148;
    shall be The City of New York, Sydney, Toronto, London (solely
    in the case of the Designated LIBOR Currency), Johannesburg and
    Zurich, respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Book-entry notes may be transferred or exchanged only through
    the Depositary. Registration of transfer or exchange of
    certificated notes will be made at the office or agency
    maintained by us for this purpose in the Borough of Manhattan,
    The City of New York, currently the corporate trust office of
    the trustee located at 40 Broad Street, 5th&#160;Floor, New
    York, New York 10004. No service charge will be imposed for any
    such registration of transfer or exchange of notes, but we may
    require payment of a sum sufficient to cover any tax or other
    governmental charge that may be imposed in connection therewith
    (other than certain exchanges not involving any transfer).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The defeasance and covenant defeasance provisions contained in
    the Indenture shall apply to the notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Guarantee</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    UDR LP will fully and unconditionally guarantee payment of any
    principal, premium and interest in respect of the notes in full
    to the holders thereof. The guarantee forms part of the
    Indenture under which the notes will be issued. If, for any
    reason, we do not make any required payment in respect of our
    notes when due, UDR LP will cause the payment to be made to or
    to the order of the applicable paying agent on behalf of the
    trustee. Holders of our notes may enforce their rights under the
    guarantee directly against UDR LP without first making a demand
    or taking action against UDR or any other person or entity. UDR
    LP may, without the consent of the holders of the notes, assume
    all of our rights and obligations under the notes and, upon such
    assumption, we will be released from our liabilities under the
    Indenture and the notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Redemption
    at Our Option; No Sinking Fund</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If an initial redemption date is specified in the applicable
    pricing supplement, we may redeem the particular notes prior to
    their stated maturity date at our option on any date on or after
    that initial redemption date in whole or from time to time in
    part in increments of $1,000 or any other integral multiple of
    an authorized denomination specified in the applicable pricing
    supplement (provided that any remaining principal amount thereof
    shall be at least $1,000 or other minimum authorized
    denomination applicable thereto), at the applicable
    Redemption&#160;Price (as defined below), together with unpaid
    interest accrued thereon to the date of redemption. We must give
    written notice to registered holders of the particular notes to
    be redeemed at our option not more than 60 nor less than 30
    calendar days prior to the date of redemption.
    &#147;Redemption&#160;Price,&#148; with respect to a note, means
    an amount equal to the initial redemption percentage specified
    in the applicable pricing supplement
</DIV>
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    <BR>
    S-7
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (as adjusted by the annual redemption percentage reduction, if
    applicable) multiplied by the unpaid principal amount thereof to
    be redeemed. The initial redemption percentage, if any,
    applicable to a note shall decline at each anniversary of the
    initial redemption date by an amount equal to the applicable
    annual redemption percentage reduction, if any, until the
    Redemption&#160;Price is equal to 100% of the unpaid principal
    amount thereof to be redeemed. For a discussion of the
    redemption of discount notes, see&#160;&#147;&#151;Discount
    Notes.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes will not be subject to, or entitled to the benefit of,
    any sinking fund.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Repayment
    at the Option of the Holder</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If one or more optional repayment dates are specified in the
    applicable pricing supplement, registered holders of the
    particular notes may require us to repay those notes prior to
    their stated maturity date on any optional repayment date in
    whole or from time to time in part in increments of $1,000 or
    any other integral multiple of an authorized denomination
    specified in the applicable pricing supplement (provided that
    any remaining principal amount thereof shall be at least $1,000
    or other minimum authorized denomination applicable thereto), at
    a repayment price equal to 100% of the unpaid principal amount
    thereof to be repaid, together with unpaid interest accrued
    thereon to the date of repayment. A registered holder&#146;s
    exercise of the repayment option will be irrevocable. For a
    discussion of the repayment of discount notes, see
    &#147;&#151;Discount Notes.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    For any note to be repaid, the trustee must receive, at its
    corporate trust office in the Borough of Manhattan, The City of
    New York, not more than 60 nor less than 30 calendar days prior
    to the date of repayment, the particular notes to be repaid and:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the case of a certificated note, the form entitled
    &#147;Option to Elect Repayment&#148; duly completed,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the case of a book-entry note, repayment instructions from
    the applicable Beneficial Owner (as defined below) to the
    Depositary and forwarded by the Depositary.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Only the Depositary may exercise the repayment option in respect
    of global securities representing book-entry notes. Accordingly,
    Beneficial Owners of global securities that desire to have all
    or any portion of the book-entry notes represented thereby
    repaid must instruct the Participant (as defined below) through
    which they own their interest to direct the Depositary to
    exercise the repayment option on their behalf by forwarding the
    repayment instructions to the trustee as aforesaid. To ensure
    that these instructions are received by the trustee on a
    particular day, the applicable Beneficial Owner must so instruct
    the Participant through which it owns its interest before that
    Participant&#146;s deadline for accepting instructions for that
    day. Different firms may have different deadlines for accepting
    instructions from their customers. Accordingly, Beneficial
    Owners should consult their Participants for the respective
    deadlines. All instructions given to Participants from
    Beneficial Owners of global securities relating to the option to
    elect repayment shall be irrevocable. In addition, at the time
    repayment instructions are given, each Beneficial Owner shall
    cause the Participant through which it owns its interest to
    transfer the Beneficial Owner&#146;s interest in the global
    security representing the related book-entry notes, on the
    Depositary&#146;s records, to the trustee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If applicable, we will comply with the requirements of
    Section&#160;14(e) of the Securities Exchange Act of 1934, as
    amended, and the rules promulgated thereunder, and any other
    securities laws or regulations in connection with any repayment
    of notes at the option of the registered holders thereof.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may at any time purchase notes at any price or prices in the
    open market or otherwise. Notes so purchased by us may, at our
    discretion, be held, resold or surrendered to the trustee for
    cancellation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Interest</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    each interest-bearing note will bear interest from its date of
    issue at the rate per annum, in the case of a fixed rate note,
    or pursuant to the interest rate formula, in the case of a
    floating rate note, in each case as specified in the applicable
    pricing supplement, until the principal thereof is paid or duly
    provided for. We will make interest payments in respect of fixed
    rate
</DIV>
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    <BR>
    S-8
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    notes and floating rate notes in an amount equal to the interest
    accrued from and including the immediately preceding Interest
    Payment Date in respect of which interest has been paid or duly
    provided for, or from and including the date of issue, if no
    interest has been paid or duly provided for, to but excluding
    the applicable Interest Payment Date or the maturity date, as
    the case may be (each, an &#147;Interest Period&#148;).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest on fixed rate notes and floating rate notes will be
    payable in arrears on each Interest Payment Date and on the
    maturity date. The first payment of interest on any note
    originally issued between a Record Date (as defined below) and
    the related Interest Payment Date will be made on the Interest
    Payment Date immediately following the next succeeding Record
    Date to the registered holder of such date on the next
    succeeding Record Date. The &#147;Record Date&#148; shall be the
    fifteenth calendar day, whether or not a business day,
    immediately preceding the related Interest Payment Date.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Fixed
    Rate Notes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest on fixed rate notes will be payable semiannually in
    arrears on June 15 and December 15 of each year or on any other
    date(s) specified in the applicable pricing supplement (each, an
    &#147;Interest Payment Date&#148; with respect to fixed rate
    notes) and on the maturity date. Each payment of interest on an
    Interest Payment Date will include interest accrued to but
    excluding such Interest Payment Date. Interest on fixed rate
    notes will be computed on the basis of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If any Interest Payment Date or the maturity date of a fixed
    rate note falls on a day that is not a business day, we will
    make the required payment of principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest on the next succeeding business day with the same force
    and effect as if made on the date such payment was due, and no
    additional interest will accrue on such payment from and after
    such Interest Payment Date or the maturity date, as the case may
    be.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Floating
    Rate Notes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest on floating rate notes will be determined by reference
    to the applicable Interest Rate Basis or Interest Rate Bases,
    which may, as described below, include:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the CD Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the CMT Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Commercial Paper Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Eleventh District Cost of Funds Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Federal Funds Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    LIBOR,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Prime Rate,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Treasury Rate,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other Interest Rate Basis or interest rate formula as may be
    specified in the applicable pricing supplement.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The applicable pricing supplement will specify certain terms of
    the floating rate notes being offered thereby, as described
    below, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the Floating Rate Note is:
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a &#147;Regular Floating Rate Note,&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a &#147;Floating Rate/ Fixed Rate Note&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an &#147;Inverse Floating Rate Note,&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the fixed rate commencement date, if applicable,
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-9
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Fixed Interest Rate, if applicable,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Interest Rate Basis or Bases,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Initial Interest Rate, if any,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Interest Reset Dates,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Interest Payment Dates,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Index Maturity,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Maximum Interest Rate
    <FONT style="white-space: nowrap">and/or</FONT>
    Minimum Interest Rate, if any,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Spread and Spread Multiplier, if any,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if one or more of the applicable Interest Rate Bases is LIBOR or
    the CMT Rate, the Designated LIBOR Currency and LIBOR Page or
    the applicable CMT Telerate Page.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    the interest rate derived from the applicable Interest Rate
    Basis will be determined in accordance with the applicable
    provisions below. The interest rate in effect on each day will
    be:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if that day is an Interest Reset Date (as defined below), the
    rate determined as of the Interest Determination Date (as
    defined below) immediately preceding that Interest Reset
    Date,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if that day is not an Interest Reset Date, the rate determined
    as of the Interest Determination Date immediately preceding the
    most recent Interest Reset Date;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    provided, however, that the interest rate in effect for the
    period, if any, from the date of issue to the first Interest
    Reset Date will be the &#147;Initial Interest Rate.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The &#147;Spread&#148; is the number of basis points to be added
    to or subtracted from the related Interest Rate Basis or Bases
    applicable to a floating rate note. The &#147;Spread
    Multiplier&#148; is the percentage of the related Interest Rate
    Basis or Bases applicable to a floating rate note by which the
    Interest Rate Basis or Bases will be multiplied to determine the
    applicable interest rate of such floating rate note. The
    &#147;Index Maturity&#148; is the period to maturity of the
    instrument or obligation with respect to which the related
    Interest Rate Basis or Bases will be calculated.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Regular Floating Rate Notes.</I>&#160;Unless a floating rate
    note is designated as a &#147;floating rate/fixed rate
    note,&#148; or an &#147;inverse floating rate note,&#148; or as
    having an Addendum attached or having Other/Additional
    Provisions apply, in each case relating to a different interest
    rate formula, the particular floating rate note will be
    designated as a &#147;regular floating rate note&#148; and will
    bear interest at the rate determined by reference to the
    applicable Interest Rate Basis or Bases:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    plus or minus the applicable Spread, and/or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    multiplied by the applicable Spread Multiplier.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Commencing on the first Interest Reset Date, the rate at which
    interest on a regular floating rate note is payable will be
    reset as of each Interest Reset Date; provided, however, that
    the interest rate in effect for the period, if any, from the
    date of issue to the first Interest Reset Date will be the
    initial interest rate (the &#147;Initial Interest Rate&#148;).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Floating Rate/Fixed Rate Notes.</I>&#160;If a floating rate
    note is designated as a &#147;floating rate/fixed rate
    note,&#148; the particular floating rate note will bear interest
    at the rate determined by reference to the applicable Interest
    Rate Basis or Bases:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    plus or minus the applicable Spread, and/or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    multiplied by the applicable Spread Multiplier.
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-10
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Commencing on the first Interest Reset Date, the rate at which
    interest on a floating rate/fixed rate note is payable will be
    reset as of each Interest Reset Date; provided, however, that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the interest rate in effect for the period, if any, from the
    date of issue to the first Interest Reset Date will be the
    Initial Interest Rate,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the interest rate in effect for the period commencing on the
    fixed rate commencement date to the maturity date will be the
    &#147;Fixed Interest Rate,&#148; if specified in the applicable
    pricing supplement, or, if not so specified, the interest rate
    in effect on the day immediately preceding the fixed rate
    commencement Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Inverse Floating Rate Notes.</I>&#160;If a floating rate note
    is designated as an &#147;inverse floating rate note,&#148; the
    particular floating rate note will bear interest at the Fixed
    Interest Rate minus the rate determined by reference to the
    applicable Interest Rate Basis or Bases:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    plus or minus the applicable Spread, and/or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    multiplied by the applicable Spread Multiplier;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    provided, however, that the interest rate on an inverse floating
    rate note will not be less than zero. Commencing on the first
    Interest Reset Date, the rate at which interest on an inverse
    floating rate note is payable will be reset as of each Interest
    Reset Date; and provided, further, that the interest rate in
    effect for the period, if any, from the date of issue to the
    first Interest Reset Date will be the Initial Interest Rate.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Interest Reset Dates.</I>&#160;The applicable pricing
    supplement will specify the dates on which the rate of interest
    on a floating rate note will be reset (each, an &#147;Interest
    Reset Date&#148;), and the period between Interest Reset Dates
    will be the &#147;Interest Reset Period.&#148; The Interest
    Reset Dates will be, in the case of floating rate notes which
    reset:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    daily&#151;&#160;each business day,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    weekly&#151;&#160;the Wednesday of each week, with the exception
    of weekly reset floating rate notes as to which the Treasury
    Rate is an applicable Interest Rate Basis, which will reset the
    Tuesday of each week, except as described below under
    &#147;&#151;Interest Determination Dates,&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    monthly&#151;&#160;the third Wednesday of each month, with the
    exception of monthly reset floating rate notes as to which the
    Eleventh District Cost of Funds Rate is an applicable Interest
    Rate Basis, which will reset on the first calendar day of the
    month,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    quarterly&#151;&#160;the third Wednesday of March, June,
    September and December of each year,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    semiannually&#151;&#160;the third Wednesday of the two months of
    each year specified in the applicable pricing
    supplement,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    annually&#151;&#160;the third Wednesday of the month of each
    year specified in the applicable pricing supplement,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    provided however, that, with respect to floating rate/fixed rate
    notes, the rate of interest thereon will not reset after the
    particular fixed rate commencement date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If any Interest Reset Date for any floating rate note would
    otherwise be a day that is not a business day, the particular
    Interest Reset Date will be postponed to the next succeeding
    business day, except that in the case of a floating rate note as
    to which LIBOR is an applicable Interest Rate Basis and that
    business day falls in the next succeeding calendar month, the
    particular Interest Reset Date will be the immediately preceding
    business day. In addition, in the case of a floating rate note
    as to which the Treasury Rate is an applicable Interest Rate
    Basis, if the Interest Determination Date would otherwise fall
    on an Interest Reset Date, the particular Interest Reset Date
    will be postponed to the next succeeding business day.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Interest Determination Dates.</I>&#160;Unless otherwise
    specified in the applicable pricing supplement, the interest
    rate applicable to an Interest Reset Period commencing on the
    related Interest Reset Date will be
</DIV>
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    <BR>
    S-11
</DIV><!-- END PAGE WIDTH -->
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<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    determined by reference to the applicable Interest Rate Basis as
    of the particular &#147;Interest Determination Date,&#148; which
    will be:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to the Federal Funds Rate and the Prime
    Rate&#151;&#160;the business day immediately preceding the
    related Interest Reset Date,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to the CD Rate, the CMT Rate and the Commercial
    Paper Rate&#151;&#160;the second business day preceding the
    applicable Interest Reset Date,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to the Eleventh District Cost of Funds
    Rate&#151;&#160;the last working day of the month immediately
    preceding the applicable Interest Reset Date on which the
    Federal Home Loan Bank of San&#160;Francisco publishes the Index
    (as defined below),
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to LIBOR&#151;&#160;the second London Banking Day
    preceding the applicable Interest Reset Date unless the
    Designated LIBOR currency is British pounds sterling, in which
    case the Interest Determination Date will be the applicable
    Interest Reset Date,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    with respect to the Treasury Rate&#151;&#160;the day in the week
    in which the applicable Interest Reset Date falls on which day
    Treasury Bills (as defined below) are normally auctioned (i.e.,
    Treasury Bills are normally sold at auction on Monday of each
    week, unless that day is a legal holiday, in which case the
    auction is normally held on the following Tuesday, except that
    the auction may be held on the preceding Friday); provided,
    however, that if an auction is held on the Friday of the week
    preceding the applicable Interest Reset Date, the Interest
    Determination Date will be the preceding Friday.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Interest Determination Date pertaining to a floating rate
    note the interest rate of which is determined with reference to
    two or more Interest Rate Bases will be the latest business day
    which is at least two business days before the related Interest
    Reset Date for the applicable floating rate note on which each
    Interest Reset Basis is determinable. Each Interest Rate Basis
    will be determined on the Interest Determination Date, and the
    applicable interest rate will take effect on the related
    Interest Reset Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Calculation Dates.</I>&#160;Unless otherwise specified in the
    applicable pricing supplement, U.S.&#160;Bank National
    Association will be the &#147;Calculation Agent.&#148; The
    interest rate applicable to each Interest Reset Period will be
    determined by the Calculation Agent on or prior to the
    Calculation Date (as defined below), except with respect to
    LIBOR and the Eleventh District Cost of Funds Rate, which will
    be determined on the particular Interest Determination Date.
    Upon request of the registered holder of a floating rate note,
    the Calculation Agent will disclose the interest rate then in
    effect and, if determined, the interest rate that will become
    effective as a result of a determination made for the next
    succeeding Interest Reset Date with respect to the particular
    floating rate note. Unless otherwise specified in the applicable
    pricing supplement, the &#147;Calculation Date,&#148; if
    applicable, pertaining to any Interest Determination Date will
    be the earlier of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the tenth calendar day after the particular Interest
    Determination Date or, if such day is not a business day, the
    next succeeding business day,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the business day immediately preceding the applicable Interest
    Payment Date or the maturity date, as the case may be.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Maximum and Minimum Interest Rates.</I>&#160;A floating rate
    note may also have either or both of the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a maximum numerical limitation, or ceiling, on the per annum
    rate of interest in effect with respect to such note that may
    accrue during any Interest Reset Period (a &#147;Maximum
    Interest Rate&#148;),&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a minimum numerical limitation, or floor, on the per annum rate
    of interest in effect with respect to such note that may accrue
    during any Interest Reset Period (a &#147;Minimum Interest
    Rate&#148;).
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-12
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition to any Maximum Interest Rate that may apply to a
    floating rate note, the interest rate on floating rate notes
    will in no event be higher than the maximum rate permitted by
    New York law, as the same may be modified by United States law
    of general application.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Interest Payments.</I>&#160;The applicable pricing supplement
    will specify the dates on which interest on floating rate notes
    is payable (each, an &#147;Interest Payment Date&#148; with
    respect to Floating Rate Notes). The Interest Payment Dates will
    be, in the case of floating rate notes which reset:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    daily, weekly or monthly&#151;&#160;the third Wednesday of each
    month or the third Wednesday of March, June, September and
    December of each year, as specified in the applicable pricing
    supplement,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    quarterly&#151;&#160;the third Wednesday of March, June,
    September and December of each year,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    semiannually&#151;&#160;the third Wednesday of the two months of
    each year specified in the applicable pricing
    supplement,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    annually&#151;&#160;the third Wednesday of the month of each
    year specified in the applicable pricing supplement.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, the maturity date will also be an Interest Payment
    Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If any Interest Payment Date other than the maturity date for
    any floating rate note would otherwise be a day that is not a
    business day, such Interest Payment Date will be postponed to
    the next succeeding business day, except that in the case of a
    floating rate note as to which LIBOR is an applicable Interest
    Rate Basis and that business day falls in the next succeeding
    calendar month, the particular Interest Payment Date will be the
    immediately preceding business day. If the maturity date of a
    floating rate note falls on a day that is not a business day, we
    will make the required payment of principal, premium, if any,
    and interest on the next succeeding business day with the same
    force and effect as if made on the date that payment was due,
    and no additional interest will accrue on the payment for the
    period from and after the maturity date to the payment on that
    next succeeding business day.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    All percentages resulting from any calculation on floating rate
    notes will be rounded to the nearest one hundred-thousandth of a
    percentage point, with five-one millionths of a percentage point
    rounded upwards. For example, 9.876545% (or .09876545) would be
    rounded to 9.87655% (or .0987655). All dollar amounts used in or
    resulting from any calculation on floating rate notes will be
    rounded, in the case of U.S.&#160;dollars, to the nearest cent
    or, in the case of a foreign currency, to the nearest unit (with
    one-half cent or unit being rounded upwards).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    With respect to each floating rate note, accrued interest is
    calculated by multiplying its principal amount by an accrued
    interest factor. The accrued interest factor is computed by
    adding the interest factor calculated for each day in the
    particular Interest Period. Unless otherwise specified in the
    applicable pricing supplement, the interest factor for each of
    those days will be computed by dividing the interest rate
    applicable to such day by 360, in the case of floating rate
    notes as to which the CD Rate, the Commercial Paper Rate, the
    Eleventh District Cost of Funds Rate, the Federal Funds Rate,
    LIBOR or the Prime Rate is an applicable Interest Rate Basis, or
    by the actual number of days in the year, in the case of
    floating rate notes as to which the CMT Rate or the Treasury
    Rate is an applicable Interest Rate Basis. Unless otherwise
    specified in the applicable pricing supplement, the interest
    factor for floating rate notes as to which the interest rate is
    calculated with reference to two or more Interest Rate Bases
    will be calculated in each period in the same manner as if only
    the applicable Interest Rate Basis specified in the applicable
    pricing supplement applied.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Calculation Agent shall determine the rate derived from each
    Interest Rate Basis in accordance with the following provisions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>CD Rate.</I>&#160;Unless otherwise specified in the
    applicable pricing supplement, &#147;CD Rate&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    the rate on the particular Interest Determination Date for
    negotiable U.S.&#160;dollar certificates of deposit having the
    Index Maturity specified in the applicable pricing supplement as
    published in H.15(519) (as defined below) under the heading
    &#147;CDs (secondary market),&#148;&#160;or
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(1) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date for negotiable U.S.&#160;dollar certificates
    of deposit of the particular Index Maturity specified in the
    applicable pricing supplement as published in H.15 Daily Update
    (as defined below), or other recognized electronic source used
    for the purpose of displaying the applicable rate, under the
    caption &#147;CDs (secondary market),&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(2) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date calculated by the Calculation Agent as the
    arithmetic mean of the secondary market offered rates as of
    10:00&#160;A.M., New York City time, on that Interest
    Determination Date, of three leading nonbank dealers in
    negotiable U.S.&#160;dollar certificates of deposit in The City
    of New York (which may include the Agents or their affiliates)
    selected by the Calculation Agent for negotiable
    U.S.&#160;dollar certificates of deposit of major United States
    money market banks for negotiable United States certificates of
    deposit with a remaining maturity closest to the particular
    Index Maturity specified in the applicable pricing supplement in
    an amount that is representative for a single transaction in
    that market at that time,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;
</TD>
    <TD align="left">
    if the dealers so selected by the Calculation Agent are not
    quoting as mentioned in clause (3), the CD Rate in effect on the
    particular Interest Determination Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;H.15(519)&#148; means the weekly statistical release
    designated as H.15(519), or any successor publication, published
    by the Board of Governors of the Federal Reserve System.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;H.15 Daily Update&#148; means the daily update of
    H.15(519), available through the worldwide web site of the Board
    of Governors of the Federal Reserve System at
    http:/www.federalreserve.gov/releases/h15/update, or any
    successor site or publication.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>CMT Rate.</I>&#160;Unless otherwise specified in the
    applicable pricing supplement, &#147;CMT Rate&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    if Reuters Page&#160;FRBCMT is specified in the applicable
    pricing supplement:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (a)&#160;the percentage equal to the yield for United States
    Treasury securities at &#147;constant maturity&#148; having the
    Index Maturity specified in the applicable pricing supplement as
    published in H.15(519) under the caption &#147;Treasury Constant
    Maturities,&#148; as the yield is displayed on Reuters (or any
    successor service) on page&#160;FRBCMT (or any other page as may
    replace the specified page on that service) (&#147;Reuters
    Page&#160;FRBCMT&#148;) or, if not so displayed, on the
    Bloomberg service (or any successor service) on Page&#160;NDX 7
    (or any other page as may replace the specified page on that
    service) (&#147;Bloomberg Page&#160;NDX 7&#148;), for the
    particular Interest Determination Date,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (b)&#160;if the rate referred to in clause&#160;(a) does not so
    appear on Reuters Page&#160;FRBCMT or Bloomberg Page&#160;NDX 7,
    as the case may be, on the related Calculation Date, the
    percentage equal to the yield for United States Treasury
    securities at &#147;constant maturity&#148; having the
    particular Index Maturity and for the particular Interest
    Determination Date as published in H.15(519) under the caption
    &#147;Treasury Constant Maturities,&#148;&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (c)&#160;if the rate referred to in clause&#160;(b) does not so
    appear in H.15(519), the rate on the particular Interest
    Determination Date for the period of the particular Index
    Maturity as may then be published by either the Federal Reserve
    System Board of Governors or the United States Department of the
    Treasury that the Calculation Agent determines to be comparable
    to the rate which would otherwise have been published in
    H.15(519),&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (d)&#160;if the rate referred to in clause&#160;(c) is not so
    published on the related Calculation Date, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent as a yield to maturity based on the arithmetic
    mean of the secondary market bid prices at approximately
    3:30&#160;P.M., New York City time, on that Interest
    Determination Date of three leading primary United States
    government securities dealers in The City of New York (which may
    include the
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-14
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Agents or their affiliates) (each, a &#147;Reference
    Dealer&#148;), selected by the Calculation Agent from five
    Reference Dealers selected by the Calculation Agent and
    eliminating the highest quotation, or, in the event of equality,
    one of the highest, and the lowest quotation or, in the event of
    equality, one of the lowest, for United States Treasury
    securities with an original maturity equal to the particular
    Index Maturity, a remaining term to maturity no more than
    1&#160;year shorter than that Index Maturity and in a principal
    amount that is representative for a single transaction in the
    securities in that market at that time,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (e)&#160;if fewer than five but more than two of the prices
    referred to in clause&#160;(d) are provided as requested, the
    rate on the particular Interest Determination Date calculated by
    the Calculation Agent based on the arithmetic mean of the bid
    prices obtained and neither the highest nor the lowest of the
    quotations shall be eliminated,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (f)&#160;if fewer than three prices referred to in
    clause&#160;(d) are provided as requested, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent as a yield to maturity based on the arithmetic
    mean of the secondary market bid prices as of approximately
    3:30&#160;P.M., New York City time, on that Interest
    Determination Date of three Reference Dealers selected by the
    Calculation Agent from five Reference Dealers selected by the
    Calculation Agent and eliminating the highest quotation or, in
    the event of equality, one of the highest and the lowest
    quotation or, in the event of equality, one of the lowest, for
    United States Treasury securities with an original maturity
    greater than the particular Index Maturity, a remaining term to
    maturity closest to that Index Maturity and in a principal
    amount that is representative for a single transaction in the
    securities in that market at that time,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (g)&#160;if fewer than five but more than two prices referred to
    in clause&#160;(f) are provided as requested, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent based on the arithmetic mean of the bid prices
    obtained and neither the highest nor the lowest of the
    quotations will be eliminated,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (h)&#160;if fewer than three prices referred to in
    clause&#160;(f) are provided as requested, the CMT Rate in
    effect on the particular Interest Determination Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if Reuters Page&#160;FEDCMT is specified in the applicable
    pricing supplement:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (a)&#160;the percentage equal to the one-week or one-month, as
    specified in the applicable pricing supplement, average yield
    for United States Treasury securities at &#147;constant
    maturity&#148; having the Index Maturity specified in the
    applicable pricing supplement as published in H.15(519) opposite
    the caption &#147;Treasury Constant Maturities,&#148; as the
    yield is displayed on Reuters (or any successor service) on
    page&#160;FEDCMT (or any other page as may replace the specified
    page on that service) (&#147;Reuters Page&#160;FEDCMT&#148;) or,
    if not so displayed, on the Bloomberg service (or any successor
    service) on Bloomberg Page&#160;NDX 7, for the week or month, as
    applicable, ended immediately preceding the week or month, as
    applicable, in which the particular Interest Determination Date
    falls,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (b)&#160;if the rate referred to in clause&#160;(a) does not so
    appear on Reuters Page&#160;FEDCMT or Bloomberg Page&#160;NDX 7,
    as the case may be, on the related Calculation Date, the
    percentage equal to the one-week or one-month, as specified in
    the applicable pricing supplement, average yield for United
    States Treasury securities at &#147;constant maturity&#148;
    having the particular Index Maturity and for the week or month,
    as applicable, preceding the particular Interest Determination
    Date as published in H.15(519) opposite the caption
    &#147;Treasury Constant Maturities,&#148;&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (c)&#160;if the rate referred to in clause&#160;(b) does not so
    appear in H.15(519) on the related Calculation Date, the
    one-week or one-month, as specified in the applicable pricing
    supplement, average yield for United States Treasury securities
    at &#147;constant maturity&#148; having the particular Index
    Maturity as otherwise announced by the Federal Reserve Bank of
    New York for the week or month, as applicable, ended immediately
    preceding the week or month, as applicable, in which the
    particular Interest Determination Date falls,&#160;or
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-15
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (d)&#160;if the rate referred to in clause&#160;(c) is not so
    published on the related Calculation Date, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent as a yield to maturity based on the arithmetic
    mean of the secondary market bid prices at approximately
    3:30&#160;P.M., New York City time, on that Interest
    Determination Date of three Reference Dealers selected by the
    Calculation Agent from five Reference Dealers selected by the
    Calculation Agent and eliminating the highest quotation, or, in
    the event of equality, one of the highest, and the lowest
    quotation or, in the event of equality, one of the lowest, for
    United States Treasury securities with an original maturity
    equal to the particular Index Maturity, a remaining term to
    maturity no more than 1&#160;year shorter than that Index
    Maturity and in a principal amount that is representative for a
    single transaction in the securities in that market at that
    time,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (e)&#160;if fewer than five but more than two of the prices
    referred to in clause&#160;(d) are provided as requested, the
    rate on the particular Interest Determination Date calculated by
    the Calculation Agent based on the arithmetic mean of the bid
    prices obtained and neither the highest nor the lowest of the
    quotations shall be eliminated,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (f)&#160;if fewer than three prices referred to in
    clause&#160;(d) are provided as requested, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent as a yield to maturity based on the arithmetic
    mean of the secondary market bid prices as of approximately
    3:30&#160;P.M., New York City time, on that Interest
    Determination Date of three Reference Dealers selected by the
    Calculation Agent from five Reference Dealers selected by the
    Calculation Agent and eliminating the highest quotation or, in
    the event of equality, one of the highest and the lowest
    quotation or, in the event of equality, one of the lowest, for
    United States Treasury securities with an original maturity
    greater than the particular Index Maturity, a remaining term to
    maturity closest to that Index Maturity and in a principal
    amount that is representative for a single transaction in the
    securities in that market at the time,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (g)&#160;if fewer than five but more than two prices referred to
    in clause&#160;(f) are provided as requested, the rate on the
    particular Interest Determination Date calculated by the
    Calculation Agent based on the arithmetic mean of the bid prices
    obtained and neither the highest or the lowest of the quotations
    will be eliminated,&#160;or
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 3%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (h)&#160;if fewer than three prices referred to in
    clause&#160;(f) are provided as requested, the CMT Rate in
    effect on that Interest Determination Date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If two United States Treasury securities with an original
    maturity greater than the Index Maturity specified in the
    applicable pricing supplement have remaining terms to maturity
    equally close to the particular Index Maturity, the quotes for
    the United States Treasury security with the shorter original
    remaining term to maturity will be used.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Commercial Paper Rate.</I>&#160;Unless otherwise specified in
    the applicable pricing supplement, &#147;Commercial Paper
    Rate&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    the Money Market Yield, (as defined below), on the particular
    Interest Determination Date of the rate for commercial paper
    having the Index Maturity specified in the applicable pricing
    supplement as published in H.15(519) under the caption
    &#147;Commercial Paper-Nonfinancial,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(1) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the Money Market Yield of the rate on the
    particular Interest Determination Date for commercial paper
    having the particular Index Maturity as published in H.15 Daily
    Update, or such other recognized electronic source used for the
    purpose of displaying the applicable rate, under the caption
    &#147;Commercial Paper-Nonfinancial,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(2) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date calculated by the Calculation Agent as the
    Money Market Yield of the arithmetic mean of the offered rates
    at approximately 11:00&#160;A.M., New York City time, on that
    Interest Determination Date of three
</TD>
</TR>
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</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-16
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    leading dealers of U.S.&#160;dollar commercial paper in The City
    of New York (which may include the Agents or their affiliates)
    selected by the Calculation Agent for commercial paper having
    the particular Index Maturity specified in the applicable
    pricing supplement placed for industrial issuers whose bond
    rating is &#147;Aa,&#148; or the equivalent, from a nationally
    recognized statistical rating organization,&#160;or
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;
</TD>
    <TD align="left">
    if the dealers so selected by the Calculation Agent are not
    quoting as mentioned in clause (3), the Commercial Paper Rate in
    effect on the particular Interest Determination Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Money Market Yield&#148; means a yield (expressed as a
    percentage) calculated in accordance with the following formula:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="13%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="20%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="11%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="5%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="8%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="middle">
    Money Market Yield =
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="middle">
    360 x D<BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%; border-bottom: 1pt solid #000000"></DIV>360-(D
    x M)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="middle">
    x 100
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    where &#147;D&#148; refers to the applicable per annum rate for
    commercial paper quoted on a bank discount basis and expressed
    as a decimal, and &#147;M&#148; refers to the actual number of
    days in the applicable Interest Reset Period.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I>Eleventh District Cost of Funds Rate.</I></B>&#160;Unless
    otherwise specified in the applicable pricing supplement,
    &#147;Eleventh District Cost of Funds Rate&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    the rate equal to the monthly weighted average cost of funds for
    the calendar month immediately preceding the month in which the
    particular Interest Determination Date falls as set forth under
    the caption &#147;11th&#160;District&#148; on the display on
    Reuters (or any successor service) on page&#160;COFI/ARMS (or
    any other page as may replace the specified page on that
    service) (&#147;Reuters Page&#160;COFI/ARMS&#148;) or, if not so
    displayed, on the Bloomberg service (or any successor service)
    on page&#160;ALLX COF (or any other page as may replace the
    specified page on that service) (&#147;Bloomberg Page&#160;ALLX
    COF&#148;) as of 11:00&#160;A.M., San&#160;Francisco time, on
    that Interest Determination Date,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(1) does not so appear on
    Reuters Page COFI/ARMS or Bloomberg Page&#160;ALLX COF, as the
    case may be, the monthly weighted average cost of funds paid by
    member institutions of the Eleventh Federal Home Loan Bank
    District that was most recently announced (the
    &#147;Index&#148;) by the Federal Home Loan Bank of
    San&#160;Francisco as the cost of funds for the calendar month
    immediately preceding that Interest Determination Date,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    if the Federal Home Loan Bank of San&#160;Francisco fails to
    announce the Index on or prior to the particular Interest
    Determination Date for the calendar month immediately preceding
    that Interest Determination Date, the Eleventh District Cost of
    Funds Rate in effect on the particular Interest Determination
    Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I>Federal Funds Rate.</I></B>&#160;Federal Funds Rate Notes
    will bear interest at the rates (calculated with reference to
    the Federal Funds Rate and the Spread
    <FONT style="white-space: nowrap">and/or</FONT>
    Spread Multiplier, if any) specified in such Federal Funds Rate
    Notes. The Federal Funds Rate will be calculated by reference to
    either the Federal Funds (Effective) Rate, the Federal Funds
    Open Rate or the Federal Funds Target Rate, as specified in the
    applicable pricing supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    &#147;Federal Funds Rate&#148; means the rate determined by the
    Calculation Agent as of the applicable Interest Determination
    Date (a &#147;Federal Funds Rate Interest Determination
    Date&#148;) in accordance with the following provisions:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    If &#147;Federal Funds (Effective) Rate&#148; is the specified
    Federal Funds Rate in the applicable note, the Federal Funds
    Rate as of the applicable Federal Funds Rate Interest
    Determination Date shall be the rate with respect to such date
    for United States dollar federal funds as published in H.15(519)
    opposite the caption &#147;Federal funds (effective),&#148; as
    such rate is displayed on Reuters on page&#160;FEDFUNDS1 (or any
    other page as may replace such page on such service)
    (&#147;Reuters Page&#160;FEDFUNDS1&#148;) under the heading
    &#147;EFFECT,&#148; or, if such rate is not so published by
    3:00&#160;P.M., New York City time, on the Calculation Date, the
    rate with respect to such Federal
</TD>
</TR>

</TABLE>
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    <BR>
    S-17
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    Funds Rate Interest Determination Date for United States dollar
    federal funds as published in H.15 Daily Update, or such other
    recognized electronic source used for the purpose of displaying
    such rate, under the caption &#147;Federal funds
    (effective).&#148; If such rate does not appear on Reuters
    Page&#160;FEDFUNDS1 or is not yet published in H.15(519), H.15
    Daily Update or another recognized electronic source by
    3:00&#160;P.M., New York City time, on the related Calculation
    Date, then the Federal Funds Rate with respect to such Federal
    Funds Rate Interest Determination Date shall be calculated by
    the Calculation Agent and will be the arithmetic mean of the
    rates for the last transaction in overnight United States dollar
    federal funds arranged by three leading brokers of
    U.S.&#160;dollar federal funds transactions in The City of New
    York (which may include the agents or their affiliates) selected
    by the Calculation Agent, prior to 9:00&#160;A.M., New York City
    time, on the Business Day following such Federal Funds Rate
    Interest Determination Date; <I>provided, however, </I>that if
    the brokers so selected by the Calculation Agent are not quoting
    as mentioned in this sentence, the Federal Funds Rate determined
    as of such Federal Funds Rate Interest Determination Date will
    be the Federal Funds Rate in effect on such Federal Funds Rate
    Interest Determination Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    If &#147;Federal Funds Open Rate&#148; is the specified Federal
    Funds Rate in the applicable note, the Federal Funds Rate as of
    the applicable Federal Funds Rate Interest Determination Date
    shall be the rate on such date under the heading &#147;Federal
    Funds&#148; for the relevant Index Maturity and opposite the
    caption &#147;Open&#148; as such rate is displayed on Reuters on
    page&#160;5 (or any other page as may replace such page on such
    service) (&#147;Reuters Page&#160;5&#148;), or, if such rate
    does not appear on Reuters Page&#160;5 by 3:00&#160;P.M., New
    York City time, on the Calculation Date, the Federal Funds Rate
    for the Federal Funds Rate Interest Determination Date will be
    the rate for that day displayed on FFPREBON Index page on
    Bloomberg L.P. (&#147;Bloomberg&#148;), which is the Fed Funds
    Opening Rate as reported by Prebon Yamane (or a successor) on
    Bloomberg. If such rate does not appear on Reuters Page&#160;5
    or is not displayed on FFPREBON Index page on Bloomberg or
    another recognized electronic source by 3:00&#160;P.M., New York
    City time, on the related Calculation Date, then the Federal
    Funds Rate on such Federal Funds Rate Interest Determination
    Date shall be calculated by the Calculation Agent and will be
    the arithmetic mean of the rates for the last transaction in
    overnight United States dollar federal funds arranged by three
    leading brokers of United States dollar federal funds
    transactions in The City of New York (which may include the
    agents or their affiliates) selected by the Calculation Agent
    prior to 9:00&#160;A.M., New York City time, on such Federal
    Funds Rate Interest Determination Date; <I>provided, however,
    </I>that if the brokers so selected by the Calculation Agent are
    not quoting as mentioned in this sentence, the Federal Funds
    Rate determined as of such Federal Funds Rate Interest
    Determination Date will be the Federal Funds Rate in effect on
    such Federal Funds Rate Interest Determination Date.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    If &#147;Federal Funds Target Rate&#148; is the specified
    Federal Funds Rate in the applicable note, the Federal Funds
    Rate as of the applicable Federal Funds Rate Interest
    Determination Date shall be the rate on such date as displayed
    on the FDTR Index page on Bloomberg. If such rate does not
    appear on the FDTR Index page on Bloomberg by 3:00&#160;P.M.,
    New York City time, on the Calculation Date, the Federal Funds
    Rate for such Federal Funds Rate Interest Determination Date
    will be the rate for that day appearing on Reuters
    Page&#160;USFFTARGET= (or any other page as may replace such
    page on such service) (&#147;Reuters
    Page&#160;USFFTARGET=&#148;). If such rate does not appear on
    the FDTR Index page on Bloomberg or is not displayed on Reuters
    Page&#160;USFFTARGET= by 3:00&#160;P.M., New York City time, on
    the related Calculation Date, then the Federal Funds Rate on
    such Federal Funds Rate Interest Determination Date shall be
    calculated by the Calculation Agent and will be the arithmetic
    mean of the rates for the last transaction in overnight United
    States dollar federal funds arranged by three leading brokers of
    United States dollar federal funds transactions in The City of
    New York (which may include the agents or their affiliates)
    selected by the Calculation Agent prior to 9:00&#160;A.M., New
    York City time, on such Federal Funds Rate Interest
    Determination Date.
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-18
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I>LIBOR.</I></B>&#160;Unless otherwise specified in the
    applicable pricing supplement, &#147;LIBOR&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    With respect to any Interest Determination Date relating to a
    floating rate note for which the interest rate is determined
    with reference to LIBOR (a &#147;LIBOR Interest Determination
    Date&#148;), LIBOR will be the rate for deposits in the
    Designated LIBOR Currency having the Index Maturity specified in
    such note as such rate is displayed on Reuters on
    page&#160;LIBOR01 (or any other page as may replace such page on
    such service for the purpose of displaying the London interbank
    rates of major banks for the Designated LIBOR Currency)
    (&#147;Reuters Page&#160;LIBOR01&#148;) as of 11:00&#160;A.M.,
    London time, on such LIBOR Interest Determination Date. If no
    such rate so appears, LIBOR on such LIBOR Interest Determination
    Date will be determined in accordance with the provisions
    described in clause&#160;(2) below.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    With respect to a LIBOR Interest Determination Date on which no
    rate is displayed on Reuters Page&#160;LIBOR01 as specified in
    clause&#160;(1) above, the Calculation Agent shall request the
    principal London offices of each of four major reference banks
    (which may include affiliates of the agents) in the London
    interbank market, as selected by the Calculation Agent, to
    provide the Calculation Agent with its offered quotation for
    deposits in the Designated LIBOR Currency for the period of the
    Index Maturity specified in the applicable note, commencing on
    the related Interest Reset Date, to prime banks in the London
    interbank market at approximately 11:00&#160;A.M., London time,
    on such LIBOR Interest Determination Date and in a principal
    amount that is representative for a single transaction in the
    Designated LIBOR Currency in such market at such time. If at
    least two such quotations are so provided, then LIBOR on such
    LIBOR Interest Determination Date will be the arithmetic mean
    calculated by the Calculation Agent of such quotations. If fewer
    than two such quotations are so provided, then LIBOR on such
    LIBOR Interest Determination Date will be the arithmetic mean
    calculated by the Calculation Agent of the rates quoted at
    approximately 11:00&#160;A.M., in the applicable Principal
    Financial Center (as defined below), on such LIBOR Interest
    Determination Date by three major banks (which may include
    affiliates of the agents) in such Principal Financial Center
    selected by the Calculation Agent for loans in the Designated
    LIBOR Currency to leading European banks, having the Index
    Maturity specified in the applicable note and in a principal
    amount that is representative for a single transaction in the
    Designated LIBOR Currency in such market at such time;
    <I>provided, however, </I>that if the banks so selected by the
    Calculation Agent are not quoting as mentioned in this sentence,
    LIBOR determined as of such LIBOR Interest Determination Date
    shall be LIBOR in effect on such LIBOR Interest Determination
    Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Designated LIBOR Currency&#148; means the currency
    specified in the applicable note as to which LIBOR shall be
    calculated or, if no such currency is specified in the
    applicable note, U.S.&#160;dollars.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Principal Financial Center&#148; means (i)&#160;the
    capital city of the country issuing the specified currency or
    (ii)&#160;the capital city of the country to which the
    Designated LIBOR Currency, if applicable, relates, except, in
    each case, that with respect to United States dollars,
    Australian dollars, Canadian dollars, Euros, New Zealand
    dollars, South African rand and Swiss francs, the
    &#147;Principal Financial Center&#148; shall be The City of New
    York, Sydney, Toronto, London (solely in the case of the
    Designated LIBOR Currency), Wellington, Johannesburg and Zurich,
    respectively.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I>Prime Rate.</I></B>&#160;Unless otherwise specified in the
    applicable pricing supplement, &#147;Prime Rate&#148; means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    the rate on the particular Interest Determination Date as
    published in H.15(519) under the caption &#147;Bank Prime
    Loan,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(1) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date as published in H.15 Daily Update, or such
    other recognized electronic source used for the purpose of
    displaying the applicable rate, under the caption &#147;Bank
    Prime Loan,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(2) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date calculated by the
</TD>
</TR>
<!-- XBRL Paragraph Pagebreak -->

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-19
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    Calculation Agent as the arithmetic mean of the rates of
    interest publicly announced by each bank that appears on Reuters
    on page USPRIME1 (or any other page as may replace such page on
    such service for the purpose of displaying prime rates or base
    lending rates of major United States banks) (&#147;Reuters
    Page&#160;USPRIME1&#148;) as the applicable bank&#146;s prime
    rate or base lending rate as of 11:00&#160;A.M., New York City
    time, on that Interest Determination Date,&#160;or
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;
</TD>
    <TD align="left">
    if fewer than four rates referred to in clause&#160;(3) are so
    published by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date calculated by the Calculation Agent as the
    arithmetic mean of the prime rates or base lending rates quoted
    on the basis of the actual number of days in the year divided by
    a <FONT style="white-space: nowrap">360-day</FONT>
    year as of the close of business on that Interest Determination
    Date by three major banks (which may include affiliates of the
    Agents) in The City of New York selected by the Calculation
    Agent,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (5)&#160;
</TD>
    <TD align="left">
    if the banks so selected by the Calculation Agent are not
    quoting as mentioned in clause (4), the Prime Rate in effect on
    the particular Interest Determination Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><I>Treasury Rate.</I></B>&#160;Unless otherwise specified in
    the applicable pricing supplement, &#147;Treasury Rate&#148;
    means:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (1)&#160;
</TD>
    <TD align="left">
    the rate from the auction held on the particular Interest
    Determination Date (the &#147;Auction&#148;) of direct
    obligations of the United States (&#147;Treasury Bills&#148;)
    having the Index Maturity specified in the applicable pricing
    supplement under the caption &#147;INVEST RATE&#148; on the
    display on Reuters (or any successor service) on
    page&#160;USAUCTION 10 (or any other page as may replace that
    page on that service) (&#147;Reuters Page&#160;USAUCTION
    10&#148;) or page&#160;USAUCTION 11 (or any other page as may
    replace that page on that service) (&#147;Reuters
    Page&#160;USAUCTION 11&#148;) or, if not so displayed, on the
    Bloomberg service (or any successor service) on page&#160;AUCK
    18 (or any other page as may replace the specified page on that
    service) (&#147;Bloomberg Page&#160;AUCK 18&#148;),&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (2)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(1) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the Bond Equivalent Yield (as defined below)
    of the rate for the applicable Treasury Bills as published in
    H.15 Daily Update, or another recognized electronic source used
    for the purpose of displaying the applicable rate, under the
    caption &#147;U.S.&#160;Government Securities/ Treasury Bills/
    Auction High,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (3)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(2) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the Bond Equivalent Yield of the auction rate
    of the applicable Treasury Bills as announced by the United
    States Department of the Treasury,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (4)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(3) is not so announced
    by the United States Department of the Treasury, or if the
    Auction is not held, the Bond Equivalent Yield of the rate on
    the particular Interest Determination Date of the applicable
    Treasury Bills as published in H.15(519) under the caption
    &#147;U.S.&#160;Government Securities/ Treasury Bills/ Secondary
    Market,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (5)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(4) not so published by
    3:00&#160;P.M., New York City time, on the related Calculation
    Date, the rate on the particular Interest Determination Date of
    the applicable Treasury Bills as published in H.15 Daily Update,
    or another recognized electronic source used for the purpose of
    displaying the applicable rate, under the caption
    &#147;U.S.&#160;Government Securities/ Treasury Bills/ Secondary
    Market,&#148;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (6)&#160;
</TD>
    <TD align="left">
    if the rate referred to in clause&#160;(5) is not so published
    by 3:00&#160;P.M., New York City time, on the related
    Calculation Date, the rate on the particular Interest
    Determination Date calculated by the Calculation Agent as the
    Bond Equivalent Yield of the arithmetic mean of the secondary
    market bid rates, as of approximately 3:30&#160;P.M., New York
    City time, on that Interest Determination Date, of three primary
    United States government securities dealers (which may include
    the Agents or their affiliates) selected by the Calculation
    Agent, for the issue of Treasury Bills with a remaining maturity
    closest to the Index Maturity specified in the applicable
    pricing supplement,&#160;or
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    S-20
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    (7)&#160;
</TD>
    <TD align="left">
    if the dealers so selected by the Calculation Agent are not
    quoting as mentioned in clause (6), the Treasury Rate in effect
    on the particular Interest Determination Date.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Bond Equivalent Yield&#148; means a yield (expressed as a
    percentage) calculated in accordance with the following formula:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="12%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="22%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="11%">&nbsp;</TD>	<!-- colindex=03 type=maindata -->
    <TD width="19%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="5%">&nbsp;</TD>	<!-- colindex=04 type=maindata -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="7%">&nbsp;</TD>	<!-- colindex=05 type=maindata -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<!-- TableOutputBody -->
<TR valign="bottom">
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="middle">
    Bond Equivalent Yield =
</TD>
<TD>
&nbsp;
</TD>
<TD align="center" valign="middle">
    D x N<BR>
    <DIV style="font-size: 2pt; margin-left: 0%; width: 100%; border-bottom: 1pt solid #000000"></DIV>360-(D
    x M)
</TD>
<TD>
&nbsp;
</TD>
<TD align="left" valign="middle">
    x 100
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="left" valign="top">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    where &#147;D&#148; refers to the applicable per annum rate for
    Treasury Bills quoted on a bank discount basis and expressed as
    a decimal, &#147;N&#148; refers to 365 or 366, as the case may
    be, and &#147;M&#148; refers to the actual number of days in the
    applicable Interest Reset Period.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Certain
    Covenants</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    With respect to the notes offered under this prospectus
    supplement and accompanying prospectus, the covenant limiting
    our incurrence of debt as set forth in Section&#160;1004(a) of
    the Indenture and described on page&#160;8 of the accompanying
    prospectus under the heading &#147;Description of Debt
    Securities-Covenants Under the Senior Indenture,&#148; shall be
    superseded by a similar covenant that changes the limitation of
    our outstanding debt on a consolidated basis determined in
    accordance with generally accepted accounting principles from
    60% to 65%. For the notes offered under this prospectus
    supplement and accompanying prospectus, the new covenant that
    replaces the covenant set forth in Section&#160;1004(a) of the
    Indenture (and which is described on page&#160;8 of the
    accompanying prospectus) provides that we will not, and will not
    permit any subsidiary to, incur any Debt (as defined beginning
    on page&#160;9 of the accompanying prospectus) if, immediately
    after giving effect to the incurrence of the additional Debt and
    the application of the proceeds from the Debt, the aggregate
    principal amount of all of our outstanding Debt on a
    consolidated basis determined in accordance with generally
    accepted accounting principles is greater than 65% of the sum
    of, without duplication:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our Total Assets (as defined on page&#160;10 of the accompanying
    prospectus) as of the end of the calendar quarter covered in our
    Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    or Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q,</FONT>
    as the case may be, most recently filed with the Securities and
    Exchange Commission, or, if the filing is not permitted under
    the Exchange Act, with the trustee, prior to the incurrence of
    the additional Debt,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the purchase price of any real estate assets or mortgages
    receivable acquired, and the amount of any securities offering
    proceeds received, to the extent the proceeds were not used to
    acquire real estate assets or mortgages receivable or used to
    reduce Debt, by us or any subsidiary since the end of the
    calendar quarter, including those proceeds obtained in
    connection with the incurrence of the additional Debt.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition to the covenants discussed in the accompanying
    prospectus under the section entitled &#147;Description of Debt
    Securities,&#148; we are required to maintain Total Unencumbered
    Assets of not less than 150% of the aggregate outstanding
    principal amount of our Unsecured Debt. For purposes of this
    covenant, the following capitalized terms are defined as follows:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Total Unencumbered Assets&#148; means the sum of
    (i)&#160;those Undepreciated Real Estate Assets not subject to
    an encumbrance and (ii)&#160;all other assets of UDR and its
    Subsidiaries not subject to encumbrance determined in accordance
    with generally accepted accounting principles (but excluding
    accounts receivable and intangibles).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Subsidiaries&#148; or &#147;Subsidiary&#148; means a
    corporation, a limited liability company or a partnership a
    majority of the outstanding voting stock, limited liability
    company or partnership interests, as the case may be, of which
    is owned, directly or indirectly, by UDR or by one or more other
    Subsidiaries of UDR. For purposes of this definition,
    &#147;voting stock&#148; means stock having voting power for the
    election of directors, managing members or trustees, whether at
    all times or only so long as no senior class of stock has such
    voting power by reason of any contingency.
</DIV>
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    <BR>
    S-21
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Undepreciated Real Estate Assets&#148; as of any date
    means the original cost plus capital improvements of real estate
    assets of UDR and its Subsidiaries determined in accordance with
    generally accepted accounting principles.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    &#147;Unsecured Debt&#148; means debt of UDR or any Subsidiary
    that is not secured by any mortgage, lien, charge, pledge or
    security interest of any kind upon any of their properties.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Other/Additional
    Provisions; Addendum</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any provisions with respect to the notes, including the
    specification and determination of one or more Interest Rate
    Bases, the calculation of the interest rate applicable to a
    floating rate note, the Interest Payment Dates, the stated
    maturity date, any redemption or repayment provisions or any
    other term relating to the notes, may be modified
    <FONT style="white-space: nowrap">and/or</FONT>
    supplemented as specified under &#147;Other/Additional
    Provisions&#148; on the face of the applicable notes or in an
    addendum relating to the applicable notes, if so specified on
    the face of the applicable notes, and, in each case, as
    specified in the applicable pricing supplement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Discount
    Notes</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may from time to time offer notes, that we refer to herein as
    &#147;discount notes,&#148; that have an Issue Price (as
    specified in the applicable pricing supplement) that is less
    than 100% of the principal amount thereof (i.e. par) by more
    than a percentage equal to the product of 0.25% and the number
    of full years to the stated maturity date. Discount notes may
    not bear any interest currently or may bear interest at a rate
    that is below market rates at the time of issuance. Unless
    otherwise specified in the applicable pricing supplement, the
    difference between the Issue Price of a discount note and par is
    referred to as the &#147;discount.&#148; In the event of
    redemption, repayment or acceleration of maturity of a discount
    note, the amount payable to the holder of a discount note will
    be equal to the sum of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Issue Price (increased by any accruals of discount) and, in
    the event of any redemption of the applicable discount note, if
    applicable, multiplied by the initial redemption percentage
    specified in the applicable pricing supplement (as adjusted by
    the annual redemption percentage reduction, if
    applicable),&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any unpaid interest accrued on the discount notes to the date of
    the redemption, repayment or acceleration of maturity, as the
    case may be.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    for purposes of determining the amount of discount that has
    accrued as of any date on which a redemption, repayment or
    acceleration of maturity occurs for a discount note, a discount
    will be accrued using a constant yield method. The constant
    yield will be calculated using a
    <FONT style="white-space: nowrap">30-day</FONT>
    month,
    <FONT style="white-space: nowrap">360-day</FONT> year
    convention, a compounding period that, except for the Initial
    Period (as defined below), corresponds to the shortest period
    between Interest Payment Dates for the applicable discount note
    (with ratable accruals within a compounding period), a coupon
    rate equal to the initial coupon rate applicable to the discount
    note and an assumption that the maturity of a discount note will
    not be accelerated. If the period from the date of issue to the
    first Interest Payment Date for a discount note (the
    &#147;Initial Period&#148;) is shorter than the compounding
    period for the discount note, a proportionate amount of the
    yield for an entire compounding period will be accrued. If the
    Initial Period is longer than the compounding period, then the
    period will be divided into a regular compounding period and a
    short period with the short period being treated as provided in
    the preceding sentence. The accrual of the applicable discount
    may differ from the accrual of original issue discount for
    purposes of the Internal Revenue Code, certain discount notes
    may not be treated as having original issue discount within the
    meaning of the Internal Revenue Code, and notes other than
    discount notes may be treated as issued with original issue
    discount for U.S.&#160;federal income tax purposes. See
    &#147;Material U.S.&#160;Federal Income Tax Considerations.&#148;
</DIV>
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    <BR>
    S-22
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Indexed
    Notes</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may from time to time offer notes, referred to herein as
    &#147;indexed notes,&#148; with the amount of principal, premium
    <FONT style="white-space: nowrap">and/or</FONT>
    interest payable in respect thereof to be determined with
    reference to the price or prices of specified commodities or
    stocks, to the exchange rate of one or more designated
    currencies relative to one or more other indexed currencies or
    to other items, in each case as specified in the applicable
    pricing supplement. In certain cases, holders of indexed notes
    may receive a principal payment on the maturity date that is
    greater than or less than the principal amount of such indexed
    notes depending upon the relative value on the maturity date of
    the specified indexed item. Information as to the method for
    determining the amount of principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, payable in respect of indexed notes, certain
    historical information with respect to the specified indexed
    item and any material U.S.&#160;tax considerations associated
    with an investment in indexed notes will be specified in the
    applicable pricing supplement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Amortizing
    Notes</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may from time to time offer notes, referred to herein as
    &#147;amortizing notes,&#148; with the amount of principal
    thereof and interest thereon payable in installments over their
    terms. Unless otherwise specified in the applicable pricing
    supplement, interest on each amortizing note will be computed on
    the basis of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months. Payments with respect to amortizing notes will be
    applied first to interest due and payable thereon and then to
    the reduction of the unpaid principal amount thereof. Further
    information concerning additional terms and provisions of
    amortizing notes will be specified in the applicable pricing
    supplement, including a table setting forth repayment
    information for such amortizing notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Book-Entry
    Notes</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We have established a depositary arrangement with The Depository
    Trust&#160;Company with respect to the book-entry notes, the
    terms of which are summarized below. Any additional or differing
    terms of the depositary arrangement with respect to the
    book-entry notes will be described in the applicable pricing
    supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon issuance, all book-entry notes of like tenor and terms up
    to $500,000,000 aggregate principal amount bearing interest (if
    any), at the same rate or pursuant to the same formula and
    having the same date of issue, specified currency, Interest
    Payment Dates, if any, stated maturity date, redemption
    provisions (if any), repayment provisions (if any) and other
    terms, will be represented by a single global security. Each
    global security representing book-entry notes will be deposited
    with, or on behalf of, the Depositary and will be registered in
    the name of the Depositary or a nominee of the Depositary. No
    global security may be transferred except as a whole by a
    nominee of the Depositary to the Depositary or to another
    nominee of the Depositary, or by the Depositary or another
    nominee of the Depositary to a successor of the Depositary or a
    nominee of a successor to the Depositary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    So long as the Depositary or its nominee is the registered
    holder of a global security, the Depositary or its nominee, as
    the case may be, will be the sole owner of the book-entry notes
    represented thereby for all purposes under the Indenture. Except
    as otherwise provided below, the Beneficial Owners of the global
    security or securities representing book-entry notes will not be
    entitled to receive physical delivery of certificated notes and
    will not be considered the registered holders thereof for any
    purpose under the Indenture, and no global security representing
    book-entry notes shall be exchangeable or transferable.
    Accordingly, each Beneficial Owner must rely on the procedures
    of the Depositary and, if that Beneficial Owner is not a
    Participant (as defined below), on the procedures of the
    Participant through which that Beneficial Owner owns its
    interest to exercise any rights of a registered holder under the
    Indenture. The laws of some jurisdictions require that certain
    purchasers of securities take physical delivery of securities in
    certificated form. Such limits and laws may impair the ability
    to transfer beneficial interests in a global security
    representing book-entry notes.
</DIV>
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    <BR>
    S-23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    each global security representing book-entry notes will be
    exchangeable for certificated notes of like tenor and terms and
    of differing authorized denominations in a like aggregate
    principal amount, only if (i)&#160;the Depositary notifies us
    that it is unwilling or unable to continue as Depositary for the
    global securities or the Depositary has ceased to be a clearing
    agency registered under the Exchange Act and, in any such case
    we fail to appoint a successor to the Depositary within 90
    calendar days, (ii)&#160;we, in our sole discretion, determine
    that the global securities shall be exchangeable for
    certificated notes or (iii)&#160;an Event of Default (as defined
    in the Indenture) has occurred and is continuing with respect to
    the notes under the Indenture and beneficial owners representing
    a majority in principal amount of the book-entry notes
    represented by the global securities advise the Depositary to
    cease acting as depository for the global securities. Upon any
    such exchange, the certificated notes shall be registered in the
    names of the Beneficial Owners of the global security or
    securities representing book-entry notes, which names shall be
    provided by the Depositary&#146;s relevant Participants (as
    identified by the Depositary) to the trustee.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following is based on information furnished by the
    Depositary:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The Depositary will act as securities depository for the
    book-entry notes. The book-entry notes will be issued as fully
    registered securities registered in the name of Cede&#160;&#038;
    Co. (the Depositary&#146;s partnership nominee). One fully
    registered global security will be issued for each issue of
    book-entry notes, each in the aggregate principal amount of such
    issue, and will be deposited with the Depositary. If, however,
    the aggregate principal amount of any issue exceeds
    $500,000,000, one global security will be issued with respect to
    each $500,000,000 of principal amount and an additional global
    security will be issued with respect to any remaining principal
    amount of such issue.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The Depositary is a limited-purpose trust company organized
    under the New York Banking Law, a &#147;banking
    organization&#148; within the meaning of the New York Banking
    Law, a member of the Federal Reserve System, a &#147;clearing
    corporation&#148; within the meaning of the New York Uniform
    Commercial Code, and a &#147;clearing agency&#148; registered
    pursuant to the provisions of Section&#160;17A of the Exchange
    Act. The Depositary holds securities that its participants
    (&#147;Participants&#148;) deposit with the Depositary. The
    Depositary also facilitates the settlement among Participants of
    securities transactions, such as transfers and pledges, in
    deposited securities through electronic computerized book-entry
    changes in its Participants&#146; accounts, thereby eliminating
    the need for physical movement of securities certificates.
    Direct Participants of the Depositary (&#147;Direct
    Participants&#148;) include securities brokers and dealers
    (including the agents), banks, trust companies, clearing
    corporations and certain other organizations. The Depositary is
    owned by a number of its Direct Participants and by the New York
    Stock Exchange, Inc. and the Financial Industry Regulatory
    Authority, Inc., or &#147;FINRA&#148; (formerly the National
    Association of Securities Dealers, Inc.). Access to the
    Depositary&#146;s system is also available to others such as
    securities brokers and dealers, banks and trust companies that
    clear through or maintain a custodial relationship with a Direct
    Participant, either directly or indirectly (&#147;Indirect
    Participants&#148;). The rules applicable to the Depositary and
    its Participants are on file with the Securities and Exchange
    Commission.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Purchases of book-entry notes under the Depositary&#146;s system
    must be made by or through Direct Participants, which will
    receive a credit for such book-entry notes on the
    Depositary&#146;s records. The ownership interest of each actual
    purchaser of each book-entry note represented by a global
    security (&#147;Beneficial Owner&#148;) is in turn to be
    recorded on the records of Direct Participants and Indirect
    Participants. Beneficial Owners will not receive written
    confirmation from the Depositary of their purchase, but
    Beneficial Owners are expected to receive written confirmations
    providing details of the transaction, as well as periodic
    statements of their holdings, from the Direct Participants or
    Indirect Participants through which such Beneficial Owner
    entered into the transaction. Transfers of ownership interests
    in a global security representing book-entry notes are to be
    accomplished by entries made on the books of Participants acting
    on behalf of Beneficial Owners. Beneficial Owners of a global
    security representing book-entry notes will not receive
</TD>
</TR>
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    <BR>
    S-24
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    certificated notes representing their ownership interests
    therein, except in the event that use of the book-entry system
    for such book-entry notes is discontinued.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    To facilitate subsequent transfers, all global securities
    representing book-entry notes which are deposited with, or on
    behalf of, the Depositary are registered in the name of the
    Depositary&#146;s nominee, Cede&#160;&#038; Co. The deposit of
    global securities with, or on behalf of, the Depositary and
    their registration in the name of Cede&#160;&#038; Co. effect no
    change in beneficial ownership. The Depositary has no knowledge
    of the actual Beneficial Owners of the global securities
    representing the book-entry notes; the Depositary&#146;s records
    reflect only the identity of the Direct Participants to whose
    accounts such book-entry notes are credited, which may or may
    not be the Beneficial Owners. The Participants will remain
    responsible for keeping account of their holdings on behalf of
    their customers.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Conveyance of notices and other communications by the Depositary
    to Direct Participants, by Direct Participants to Indirect
    Participants, and by Direct Participants and Indirect
    Participants to Beneficial Owners will be governed by
    arrangements among them, subject to any statutory or regulatory
    requirements as may be in effect from time to time.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Neither the Depositary nor Cede&#160;&#038; Co.&#160;will
    consent or vote with respect to the global securities
    representing the book-entry notes. Under its usual procedures,
    the Depositary mails an Omnibus Proxy to a company as soon as
    possible after the applicable Record Date. The Omnibus Proxy
    assigns Cede&#160;&#038; Co.&#146;s consenting or voting rights
    to those Direct Participants to whose accounts the book-entry
    notes are credited on the applicable Record Date (identified in
    a listing attached to the Omnibus Proxy).
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, payments on the global securities representing
    the book-entry notes will be made in immediately available funds
    to the Depositary. The Depositary&#146;s practice is to credit
    Direct Participants&#146; accounts on the applicable payment
    date in accordance with their respective holdings shown on the
    Depositary&#146;s records unless the Depositary has reason to
    believe that it will not receive payment on such date. Payments
    by Participants to Beneficial Owners will be governed by
    standing instructions and customary practices, as is the case
    with securities held for the accounts of customers in bearer
    form or registered in &#147;street name,&#148; and will be the
    responsibility of such Participant and not of the Depositary,
    the trustee or us, subject to any statutory or regulatory
    requirements as may be in effect from time to time. Payment of
    principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, to the Depositary is the responsibility of the
    company and the trustee, disbursement of such payments to Direct
    Participants shall be the responsibility of the Depositary, and
    disbursement of such payments to the Beneficial Owners shall be
    the responsibility of Direct Participants and Indirect
    Participants.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If applicable, redemption notices shall be sent to
    Cede&#160;&#038; Co. If less than all of the book-entry notes of
    like tenor and terms within an issue are being redeemed, the
    Depositary&#146;s practice is to determine by lot the amount of
    the interest of each Direct Participant in such issue to be
    redeemed.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    A Beneficial Owner shall give notice of any option to elect to
    have its book-entry notes repaid by us, through its Participant,
    to the trustee, and shall effect delivery of such book-entry
    notes by causing the Direct Participant to transfer the
    Participant&#146;s interest in the global security or securities
    representing such book-entry notes, on the Depositary&#146;s
    records, to the trustee. The requirement for physical delivery
    of book-entry notes in connection with a demand for repayment
    will be deemed satisfied when the ownership rights in the global
    security or securities representing such book-entry notes are
    transferred by Direct Participants on the Depositary&#146;s
    records.
</TD>
</TR>

</TABLE>
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    <BR>
    S-25
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The Depositary may discontinue providing its services as
    securities depository with respect to the book-entry notes at
    any time by giving reasonable notice to us or the trustee. Under
    such circumstances, in the event that a successor securities
    depository is not obtained, certificated notes are required to
    be printed and delivered.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We may decide to discontinue use of the system of book-entry
    transfers through the Depositary (or a successor securities
    depository). In that event, certificated notes will be printed
    and delivered.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The information in this section concerning the Depositary and
    the Depositary&#146;s system has been obtained from sources that
    we believe to be reliable, but neither we nor any agent takes
    any responsibility for the accuracy thereof.
</TD>
</TR>

</TABLE>
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    <BR>
    S-26
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='D82419106'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">SPECIAL
    PROVISIONS RELATING TO FOREIGN CURRENCY NOTES</FONT></B>
</DIV>
</A>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    foreign currency notes will not be sold in, or to residents of,
    the country issuing the Specified Currency. The information set
    forth in this prospectus supplement is directed to prospective
    purchasers who are United States residents and, with respect to
    foreign currency notes, is by necessity incomplete. We and the
    agents disclaim any responsibility to advise prospective
    purchasers who are residents of countries other than the United
    States with respect to any matters that may affect the purchase,
    holding or receipt of payments of principal of, and premium, if
    any, and interest, if any, on, their foreign currency notes.
    These purchasers should consult their own financial and legal
    advisors with regard to these risks. See &#147;Risk
    Factors&#160;&#151; Foreign Currency Notes are Subject to
    Exchange Rate and Exchange Control Risks.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Payment
    of Principal, Premium, if Any, and Interest, if Any</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    we are obligated to make payments of principal of, and premium,
    if any, and interest, if any, on, a foreign currency note in the
    Specified Currency. Any amounts so payable by us in the
    Specified Currency will be converted by the exchange rate agent
    named in the applicable pricing supplement (the &#147;Exchange
    Rate Agent&#148;) into U.S.&#160;dollars for payment to the
    registered holders thereof unless otherwise specified in the
    applicable pricing supplement or a registered holder elects, in
    the manner described below, to receive these amounts in the
    Specified Currency.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any U.S.&#160;dollar amount to be received by a registered
    holder of a foreign currency note will be based on the highest
    bid quotation in The City of New York received by the Exchange
    Rate Agent at approximately 11:00&#160;A.M., New York City time,
    on the second business day preceding the applicable payment date
    from three recognized foreign exchange dealers (one of whom may
    be the Exchange Rate Agent) selected by the Exchange Rate Agent
    and approved by us for the purchase by the quoting dealer of the
    Specified Currency for U.S.&#160;dollars for settlement on that
    payment date in the aggregate amount of the Specified Currency
    payable to all registered holders of foreign currency notes
    scheduled to receive U.S.&#160;dollar payments and at which the
    applicable dealer commits to execute a contract. All currency
    exchange costs will be borne by the registered holders of
    foreign currency notes by deductions from any payments. If three
    bid quotations are not available, payments will be made in the
    Specified Currency.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Registered holders of foreign currency notes may elect to
    receive all or a specified portion of any payment of principal,
    premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, in the Specified Currency by submitting a
    written request to the trustee at its corporate trust office in
    The City of New York on or prior to the applicable Record Date
    or at least fifteen calendar days prior to the maturity date, as
    the case may be. This written request may be mailed or hand
    delivered or sent by cable, telex or other form of facsimile
    transmission. A holder of foreign currency notes may elect to
    receive all or a specified portion of all future payments in the
    Specified Currency and need not file a separate election for
    each payment. This election will remain in effect until revoked
    by written notice delivered to the trustee on or prior to a
    Record Date or at least fifteen calendar days prior to the
    maturity date, as the case may be. Registered holders of foreign
    currency notes to be held in the name of a broker or nominee
    should contact their broker or nominee to determine whether and
    how an election to receive payments in the Specified Currency
    may be made.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    if the Specified Currency is other than U.S.&#160;dollars, a
    Beneficial Owner of a global security or securities which elects
    to receive payments of principal, premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, in the Specified Currency must notify the
    Participant through which it owns its interest on or prior to
    the applicable Record Date or at least fifteen calendar days
    prior to the maturity date, as the case may be, of its election.
    The applicable Participant must notify the Depositary of its
    election on or prior to the third business day after the
    applicable Record Date or at least twelve calendar days prior to
    the maturity date, as the case may be, and the Depositary will
    notify the trustee of that election on or prior to the fifth
    business day after the applicable Record Date or at least ten
    calendar days prior to the maturity date, as the case may be. If
    complete instructions are received by the Participant from the
    applicable
</DIV>
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    <BR>
    S-27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Beneficial Owner and forwarded by the Participant to the
    Depositary, and by the Depositary to the trustee, on or prior to
    such dates, then the applicable Beneficial Owner will receive
    payments in the Specified Currency.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in the applicable pricing supplement,
    we are obligated to make payments of the principal of, and
    premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, on, foreign currency notes which are to be
    made in U.S.&#160;dollars in the manner specified herein with
    respect to notes denominated in U.S.&#160;dollars. We will make
    payments of interest, if any, on foreign currency notes which
    are to be made in the Specified Currency on an Interest Payment
    Date other than the maturity date by check mailed to the address
    of the registered holders of their foreign currency notes as
    they appear in the security register, subject to the right to
    receive these interest payments by wire transfer of immediately
    available funds under the circumstances described under
    &#147;Description of Notes&#151;General.&#148; We will make
    payments of principal of, and premium, if any,
    <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, on, foreign currency notes which are to be
    made in the Specified Currency on the maturity date by wire
    transfer of immediately available funds to an account with a
    bank designated at least fifteen calendar days prior to the
    maturity date by the applicable registered holder, provided the
    particular bank has appropriate facilities to make these
    payments and the particular foreign currency note is presented
    and surrendered at the office or agency maintained by us for
    this purpose in the Borough of Manhattan, The City of New York,
    in time for the trustee to make these payments in accordance
    with its normal procedures.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Availability
    of Specified Currency</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If the Specified Currency for foreign currency notes is not
    available for any required payment of principal, premium, if
    any, <FONT style="white-space: nowrap">and/or</FONT>
    interest, if any, due to the imposition of exchange controls or
    other circumstances beyond our control, we will be entitled to
    satisfy our obligations to the registered holders of these
    foreign currency notes by making payments in U.S.&#160;dollars
    on the basis of the Market Exchange Rate, computed by the
    Exchange Rate Agent, on the second business day prior to the
    particular payment or, if the Market Exchange Rate is not then
    available, on the basis of the most recently available Market
    Exchange Rate or as otherwise specified in the applicable
    pricing supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The &#147;Market Exchange Rate&#148; for a Specified Currency
    other than U.S.&#160;dollars means the noon dollar buying rate
    in The City of New York for cable transfers for the Specified
    Currency as certified for customs purposes (or, if not so
    certified, as otherwise determined) by the Federal Reserve Bank
    of New York. Any payment made in U.S.&#160;dollars under such
    circumstances shall not constitute an Event of Default (as
    defined in the Indenture).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    All determinations referred to above made by the Exchange Rate
    Agent shall be at its sole discretion and shall, in the absence
    of manifest error, be conclusive for all purposes and binding on
    the registered holders of the foreign currency notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Judgments</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under current New York law, a state court in the State of New
    York would be required to render a judgment in respect of a
    foreign currency note in the Specified Currency, and a judgment
    in the Specified Currency would be converted into
    U.S.&#160;dollars at the exchange rate prevailing on the date of
    entry of the judgment. Accordingly, registered holders of
    foreign currency notes would be subject to exchange rate
    fluctuations between the date of entry of a foreign currency
    judgment and the time when the amount of the foreign currency
    judgment is paid in U.S.&#160;dollars and converted by the
    applicable registered holder into the Specified Currency. We
    have not consented to be sued in New York state court and it is
    not certain whether a New York state court would otherwise have
    jurisdiction to enter a binding judgment against us in respect
    of a foreign currency note. It is also not certain whether a
    non-New York state court would follow the same rules and
    procedures with respect to conversions of foreign currency
    judgments.
</DIV>
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    <BR>
    S-28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will indemnify the registered holder of any note against any
    loss incurred as a result of any judgment or order being given
    or made for any amount due under the particular note and that
    judgment or order requiring payment in a currency (the
    &#147;Judgment Currency&#148;) other than the Specified
    Currency, and as a result of any variation between:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="4%"></TD>
    <TD width="89%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the rate of exchange at which the Specified Currency amount is
    converted into the Judgment Currency for the purpose of that
    judgment or order,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the rate of exchange at which the registered holder, on the date
    of payment of that judgment or order, is able to purchase the
    Specified Currency with the amount of the Judgment Currency
    actually received.
</TD>
</TR>

</TABLE>
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    <BR>
    S-29
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='D82419107'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">MATERIAL
    U.S. FEDERAL INCOME TAX CONSIDERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This section supplements the discussion under the caption
    &#147;Federal Income Tax Considerations&#148; in the
    accompanying prospectus. The following discussion describes the
    material U.S.&#160;federal income tax considerations relating to
    the ownership and disposition of our notes. Because this is a
    summary that is intended to address only material
    U.S.&#160;federal income tax considerations generally relevant
    to all holders relating to the ownership and disposition of our
    notes, it may not contain all the information that may be
    important to you. Except as discussed under the caption
    &#147;General&#148; below, this discussion does not address any
    aspects of U.S.&#160;federal income taxation relating to our
    election to be taxed as a real estate investment trust. A
    summary of material U.S.&#160;federal income tax considerations
    relating to our election to be taxed as a real estate investment
    trust, or &#147;REIT,&#148; is provided in the accompanying
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>We urge you to consult your tax advisors regarding the
    specific tax consequences to you of the acquisition, ownership,
    and disposition of our notes and of our election to be taxed as
    a REIT. Specifically, you are urged to consult your tax advisor
    regarding the U.S.&#160;federal, state, local, foreign, and
    other tax consequences of such acquisition, ownership,
    disposition, and election, and regarding potential changes in
    applicable tax laws.</I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We elected to be taxed as a REIT under the federal income tax
    laws commencing with our taxable year ended December&#160;31,
    1972. We believe that we have operated in a manner that permits
    us to satisfy the requirements for taxation as a REIT under the
    applicable provisions of the Internal Revenue Code of 1986, as
    amended (&#147;Code&#148;). Qualification and taxation as a REIT
    depends upon our ability to meet, through actual annual
    operating results, distribution levels and diversity of stock
    ownership, the various qualification tests imposed under the
    Code. Although we intend to continue to operate to satisfy such
    requirements, no assurance can be given that the actual results
    of our operations for any particular taxable year will satisfy
    such requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The provisions of the Code, Treasury Regulations promulgated
    thereunder and other federal income tax laws relating to
    qualification and operation as a REIT are highly technical and
    complex. This summary is qualified in its entirety by the
    applicable Code provisions, rules and Treasury Regulations
    thereunder, and administrative and judicial interpretations
    thereof. Further, the anticipated income tax treatment described
    in this prospectus supplement may be changed, perhaps
    retroactively, by legislative, administrative or judicial action
    at any time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The law firm of Morrison&#160;&#038; Foerster LLP has acted as
    our tax counsel in connection with the filing of this prospectus
    supplement, and the law firm of Kutak Rock LLP has acted as our
    special tax counsel regarding our REIT status in connection with
    this filing. In connection with this filing, Kutak Rock LLP will
    opine that we have been organized and have operated in
    conformity with the requirements for qualification and taxation
    as a REIT under the Code for each of our taxable years beginning
    with the taxable year ended December&#160;31, 2007 through our
    taxable year ended December&#160;31, 2010, and if we continue to
    be organized and operated after December&#160;31, 2010 in the
    same manner as we have prior to that date, we will continue to
    qualify as a REIT. The opinion of Kutak Rock LLP will be based
    on various assumptions and representations made by us as to
    factual matters, including representations made by us in this
    prospectus supplement and a factual certificate provided by one
    of our officers. Moreover, our qualification and taxation as a
    REIT depends upon our ability to meet the various qualification
    tests imposed under the Code and discussed in the accompanying
    prospectus, relating to our actual operating results, asset
    diversification, distribution levels, and diversity of stock
    ownership, the results of which have not been and will not be
    reviewed by Kutak Rock LLP. Accordingly, neither Kutak Rock LLP
    nor we can assure you that the actual results of our operations
    for any particular taxable year will satisfy these requirements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In brief, if certain detailed conditions imposed by the REIT
    provisions of the Code are satisfied, entities, such as us, that
    invest primarily in real estate and that otherwise would be
    taxable for U.S.&#160;federal income tax purposes as
    corporations, generally are not taxed at the corporate level on
    their &#147;REIT taxable
</DIV>
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    <BR>
    S-30
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    income&#148; that is distributed currently to stockholders. This
    treatment substantially eliminates the &#147;double
    taxation&#148; (i.e., taxation at both the corporate and
    stockholder levels) that generally results from investing in
    corporations under current law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we fail to qualify as a REIT in any year, however, we will be
    subject to U.S.&#160;federal income tax as if we were an
    ordinary corporation, and our stockholders will be taxed in the
    same manner as stockholders of ordinary corporations. In that
    event, we could be subject to potentially significant tax
    liabilities, the amount of cash available for distribution to
    our stockholders could be reduced and we would not be obligated
    to make any distributions. Moreover, we could be disqualified
    from taxation as a REIT for four additional taxable years.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Additional information concerning the U.S.&#160;federal income
    tax consequences of our qualification as a REIT and the
    requirements of qualification and taxation as a REIT can be
    found in the accompanying prospectus.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Tax
    Consequences of an Investment in Our Notes</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following summary describes certain material
    U.S.&#160;federal income tax considerations relating to the
    purchase, ownership, and disposition of the notes as of the date
    hereof. This discussion does not cover every type of note that
    we might issue. Any additional U.S.&#160;federal income tax
    considerations relevant to a particular issue of the notes (for
    example, special considerations relevant to indexed notes,
    amortizing notes, notes providing for contingent payments, or
    notes denominated in a currency other than the U.S.&#160;dollar)
    will be provided in the pricing supplement for such notes.
    Except where noted, this summary applies only to notes held as
    capital assets and does not apply to special situations, such as
    those of dealers in securities or currencies, tax-exempt
    organizations, individual retirement accounts and other tax
    deferred accounts, financial institutions, life insurance
    companies, persons holding notes as a part of a hedging or
    conversion transaction or a straddle, or persons (other than
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders,</FONT>
    as defined below) whose &#147;functional currency&#148; is not
    the U.S.&#160;dollar. This summary does not discuss the
    application of the alternative minimum tax to the notes. Except
    as otherwise indicated, this disclosure is addressed only to
    persons who acquire the notes at original issue and does not
    address the tax consequences to subsequent purchasers of the
    notes. The discussion below is based upon the current
    U.S.&#160;federal income tax laws and interpretations thereof as
    of the date hereof. Such authorities may be repealed, revoked,
    or modified, potentially on a retroactive basis, so as to result
    in federal income tax consequences different from those
    discussed below. Furthermore, except as otherwise indicated, the
    following summary does not consider the effect of any applicable
    foreign, state, local, or other tax laws or estate or gift tax
    considerations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If an entity treated as a partnership for U.S.&#160;federal
    income tax purposes holds notes, the tax treatment of a partner
    in the partnership will generally depend upon the status of the
    partner and the activities of the partnership. If you are a
    partner of a partnership holding our notes, you are encouraged
    to consult your tax advisor regarding the tax consequences of
    the ownership and disposition of the notes.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We urge you to consult your tax advisor regarding the specific
    tax consequences to you of the acquisition, ownership and
    disposition of the notes. Specifically, you are encouraged to
    consult your tax advisor regarding the federal, state, local,
    foreign, and other tax consequences of such acquisition,
    ownership and disposition of the notes and regarding potential
    changes in applicable tax laws.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">U.S.
    Holders</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    As used herein, a &#147;U.S.&#160;holder&#148; of a note means a
    beneficial owner of a note that for U.S.&#160;federal income tax
    purposes is:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a citizen or resident of the United States,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a corporation or other entity treated as a corporation for
    U.S.&#160;federal income tax purposes that is created or
    organized in or under the laws of the United States or any
    political subdivision thereof,
</TD>
</TR>

</TABLE>
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    <BR>
    S-31
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    an estate the income of which is subject to U.S.&#160;federal
    income taxation regardless of its source,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a trust if (a)&#160;a U.S.&#160;court is able to exercise
    primary supervision over the administration of the trust and one
    or more United States persons have the authority to control all
    substantial decisions of the trust or (b)&#160;it has a valid
    election in place to be treated as a United States person.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Payments
    of Interest on Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Except as described below in the case of interest on a note
    issued with original issue discount, as defined below under
    &#147;&#151;U.S.&#160;Holders&#151;Original Issue
    Discount,&#148; interest paid on a note (including qualified
    stated interest, as defined below under &#147;Original Issue
    Discount&#148;) generally will be taxable to a U.S.&#160;holder
    as interest income at the time it is received or accrued, in
    accordance with the U.S.&#160;holder&#146;s regular method of
    accounting for tax purposes and will be ordinary income.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Original
    Issue Discount</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    U.S.&#160;holders of notes issued with original issue discount
    (&#147;OID&#148;), other than short-term notes with a maturity
    of one year or less from the date of issue, will be subject to
    special tax accounting rules, as described in greater detail
    below. A U.S.&#160;holder of such &#147;OID notes&#148;
    generally must include OID in gross income in advance of the
    receipt of cash attributable to that income, regardless of the
    holder&#146;s usual method of tax accounting. However,
    U.S.&#160;holders of OID notes generally will not be required to
    include separately in income cash payments received on the
    notes, even if denominated as interest, to the extent those cash
    payments do not constitute &#147;qualified stated interest.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    OID generally will arise if the &#147;stated redemption price at
    maturity&#148; of a note exceeds its &#147;issue price&#148; by
    an amount equal to or greater than a specified de minimis
    amount, which is generally 0.25% of the stated redemption price
    at maturity multiplied by the number of complete years to
    maturity. The &#147;issue price&#148; of each note in a
    particular offering will generally be the first price at which a
    substantial amount of that particular offering is sold to the
    public (ignoring sales to bond houses, brokers, or similar
    persons or organizations acting in the capacity of underwriters,
    placement agents, or wholesalers). The &#147;stated redemption
    price at maturity&#148; of a note is the sum of all payments to
    be made on the note other than &#147;qualified stated
    interest.&#148; The term &#147;qualified stated interest&#148;
    generally means stated interest that is unconditionally payable
    in cash or property (other than debt instruments of the issuer),
    or that is treated as constructively received, at least annually
    at a single fixed rate or, under certain circumstances, at a
    variable rate. If a note bears interest during any accrual
    period at a rate below the rate applicable for the remaining
    term of the note (for example, notes with teaser rates or
    interest holidays), then some or all of the stated interest may
    not be treated as qualified stated interest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    U.S.&#160;holders of OID notes with a maturity of more than one
    year from issuance generally must include OID in income on a
    &#147;constant yield&#148; basis, regardless of their usual
    method of tax accounting and in advance of the receipt of some
    or all of the related cash payments. Accordingly, a
    U.S.&#160;holder may be required to include OID in income in
    advance of the receipt of some or all of the related cash
    payments. The amount of OID includible in income by the initial
    U.S.&#160;holder of an OID note is the sum of the &#147;daily
    portions&#148; of OID with respect to the note for each day
    during the taxable year or portion of the taxable year on which
    that U.S.&#160;holder held such note. This amount is referred to
    as &#147;accrued OID.&#148; The daily portion is determined by
    allocating to each day in any &#147;accrual period&#148; a pro
    rata portion of the OID allocable to that accrual period. A
    U.S.&#160;holder can use accrual periods of any length from one
    day to one year to compute accruals of OID, provided that in
    determining the OID allocable to an accrual period the yield to
    maturity is adjusted to reflect the length of that accrual
    period, and further provided that each scheduled payment of
    principal or interest occurs either on the first or the last day
    of an accrual period. The amount of OID allocable to any accrual
    period is an amount equal to the excess, if any, of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the product of the note&#146;s &#147;adjusted issue price&#148;
    at the beginning of the accrual period and its yield to
    maturity, properly adjusting for the length of the accrual
    period, over
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the aggregate of all qualified stated interest payments
    allocable to the accrual period.
</TD>
</TR>

</TABLE>
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    <BR>
    S-32
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The yield to maturity of a note equals the discount rate that,
    when used to compute the present value of all principal and
    interest payments under the note, produces a present value equal
    to the Issue Price of the note. The &#147;adjusted issue
    price&#148; of a note at the beginning of any accrual period
    generally is equal to its Issue Price:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    increased by the accrued OID for each prior accrual period,
    determined without regard to the amortization of any acquisition
    or bond premium, as described below;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    reduced by any payments made on the note, other than payments of
    qualified stated interest, on or before the first day of the
    accrual period.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under these constant yield rules, a U.S.&#160;holder will have
    to include in income increasing amounts of OID in successive
    accrual periods.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Additional rules applicable to notes with OID that are
    denominated in or determined by reference to a currency other
    than the U.S.&#160;dollar are described under
    <FONT style="white-space: nowrap">&#147;&#151;U.S.&#160;Holders&#160;&#150;Non-U.S.&#160;Dollar</FONT>
    Denominated Notes&#148; below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Variable
    Rate Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the case of a note that is a variable rate note, special
    rules apply. In general, if a note qualifies for treatment as a
    &#147;variable rate debt instrument&#148; under Treasury
    Regulations and provides for stated interest that is
    unconditionally payable at least annually at a variable rate
    that, subject to certain exceptions, is a single &#147;qualified
    floating rate&#148; or &#147;objective rate,&#148; each as
    defined below, all stated interest on the note is treated as
    qualified stated interest. In that case, both the note&#146;s
    &#147;yield to maturity&#148; and &#147;qualified stated
    interest&#148; will be determined, solely for purposes of
    calculating the accrual of OID, if any, as though the note will
    bear interest in all periods throughout its term at a fixed rate
    generally equal to the rate that would be applicable to interest
    payments on the note on its date of issue or, in the case of an
    objective rate (other than a &#147;qualified inverse floating
    rate&#148;), the rate that reflects the yield to maturity that
    is reasonably expected for the note. A U.S.&#160;holder of a
    variable rate debt instrument would then recognize OID, if any,
    that is calculated based on the note&#146;s assumed yield to
    maturity. If the interest actually accrued or paid during an
    accrual period exceeds or is less than the assumed fixed
    interest, the qualified stated interest or OID allocable to that
    period is increased or decreased under rules set forth in
    Treasury Regulations. Special rules apply for determining the
    amount of OID for other variable rate debt instruments, such as
    instruments with more than one qualified floating rate or
    instruments with a single fixed rate and one or more qualified
    floating rates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A note will qualify as a variable rate debt instrument if the
    note&#146;s issue price does not exceed the total noncontingent
    principal payments by more than the lesser of: (i) .015
    multiplied by the product of the total noncontingent principal
    payments and the number of complete years to maturity from the
    issue date, or (ii)&#160;15% of the total noncontingent
    principal payments; and the note provides for stated interest,
    compounded or paid at least annually, only at one or more
    qualified floating rates, a single fixed rate and one or more
    qualified floating rates, a single objective rate, or a single
    fixed rate and a single objective rate that is a qualified
    inverse floating rate. Generally, a rate is a qualified floating
    rate if variations in the rate can reasonably be expected to
    measure contemporaneous fluctuations in the cost of newly
    borrowed funds in the currency in which the debt instrument is
    denominated. If a note provides for two or more qualified
    floating rates that are within 0.25&#160;percentage points of
    each other on the issue date or can reasonably be expected to
    have approximately the same values throughout the term of the
    note, the qualified floating rates together constitute a single
    qualified floating rate. Generally, an objective rate is a rate
    that is determined using a single fixed formula that is based on
    objective financial or economic information such as one or more
    qualified floating rates. An objective rate is a qualified
    inverse floating rate if that rate is equal to a fixed rate
    minus a qualified floating rate and variations in the rate can
    reasonably be expected to inversely reflect contemporaneous
    variations in the qualified floating rate.
</DIV>
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    <BR>
    S-33
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A variable rate note generally will not qualify for treatment as
    a &#147;variable rate debt instrument&#148; if, among other
    circumstances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the variable rate of interest is subject to one or more minimum
    or maximum rate floors or ceilings or one or more governors
    limiting the amount of increase or decrease in each case which
    are not fixed throughout the term of the note and which are
    reasonably expected as of the issue date to cause the rate in
    some accrual periods to be significantly higher or lower than
    the overall expected return on the note determined without the
    floor, ceiling, or governor;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    in the case of certain notes, it is reasonably expected that the
    average value of the variable rate during the first half of the
    term of the note will be either significantly less than or
    significantly greater than the average value of the rate during
    the final half of the term of the note;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the value of the rate on any date during the term of the note is
    set earlier than three months prior to the first day on which
    that value is in effect or later than one year following that
    first day.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In these situations, as well as others, the note generally will
    be subject to taxation under rules applicable to contingent
    payment debt instruments. U.S.&#160;holders should consult with
    their own tax advisors regarding the specific U.S.&#160;federal
    income tax considerations with respect to these notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Acquisition
    Premium</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder purchases an OID note for an amount
    greater than its adjusted issue price (as determined above) at
    the purchase date and less than or equal to the sum of all
    amounts, other than qualified stated interest, payable on the
    OID note after the purchase date, the excess is
    &#147;acquisition premium.&#148; Under the acquisition premium
    rules, in general, the amount of OID which must be included in
    income for the note for any taxable year (or any portion of a
    taxable year in which the note is held) will be reduced (but not
    below zero) by the portion of the acquisition premium allocated
    to the period. The amount of acquisition premium allocated to
    each period is determined by multiplying the OID that otherwise
    would have been included in income by a fraction, the numerator
    of which is the excess of the cost over the adjusted issue price
    of the OID note and the denominator of which is the excess of
    the OID note&#146;s stated redemption price at maturity over its
    adjusted issue price.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder purchases an OID note for an amount less
    than its adjusted issue price (as determined above) at the
    purchase date, any OID accruing with respect to that OID note
    will be required to be included in income and, to the extent of
    the difference between the purchase amount and the OID
    note&#146;s adjusted issue price, the OID note will be treated
    as having &#147;market discount.&#148; See
    &#147;&#151;U.S.&#160;Holders&#151;Market Discount&#148; below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Amortizable
    Bond Premium</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder purchases a note (including an OID note)
    for an amount in excess of the sum of all amounts payable on the
    note after the purchase date, other than qualified stated
    interest, such holder will be considered to have purchased such
    note with &#147;amortizable bond premium&#148; equal in amount
    to such excess. A U.S.&#160;holder may elect to amortize such
    premium as an offset to interest income using a constant yield
    method over the remaining term of the note based on the
    U.S.&#160;holder&#146;s yield to maturity with respect to the
    note.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A U.S.&#160;holder generally may use the amortizable bond
    premium allocable to an accrual period to offset interest
    required to be included in the U.S.&#160;holder&#146;s income
    under its regular method of accounting with respect to the note
    in that accrual period. If the amortizable bond premium
    allocable to an accrual period exceeds the amount of interest
    allocable to such accrual period, such excess would be allowed
    as a deduction for such accrual period, but only to the extent
    of the U.S.&#160;holder&#146;s prior interest inclusions on the
    note that have not been offset previously by bond premium. Any
    excess is generally carried forward and allocable to the next
    accrual period.
</DIV>
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    <BR>
    S-34
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a note may be redeemed by us prior to its maturity date, the
    amount of amortizable bond premium will be based on the amount
    payable at the applicable redemption date, but only if use of
    the redemption date (in lieu of the stated maturity date)
    results in a smaller amortizable bond premium for the period
    ending on the redemption date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    An election to amortize bond premium applies to all taxable debt
    obligations held by the U.S.&#160;holder at the beginning of the
    first taxable year to which the election applies and thereafter
    acquired by the U.S.&#160;holder and may be revoked only with
    the consent of the Internal Revenue Service. Generally, a holder
    may make an election to include in income its entire return on a
    note (<I>i.e.</I>, the excess of all remaining payments to be
    received on the note over the amount paid for the note by such
    holder) in accordance with a constant yield method based on the
    compounding of interest, as discussed below under
    &#147;&#151;U.S.&#160;Holders&#151;Election to Treat All
    Interest as Original Issue Discount.&#148; If a holder makes
    such an election for a note with amortizable bond premium, such
    election will result in a deemed election to amortize bond
    premium for all of the holder&#146;s debt instruments with
    amortizable bond premium and may be revoked only with the
    permission of the Internal Revenue Service.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A U.S.&#160;holder that elects to amortize bond premium will be
    required to reduce its tax basis in the note by the amount of
    the premium amortized during its holding period. OID notes
    purchased at a premium will not be subject to the OID rules
    described above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder does not elect to amortize bond premium,
    the amount of bond premium will be included in its tax basis in
    the note. Therefore, if a U.S.&#160;holder does not elect to
    amortize bond premium and it holds the note to maturity, the
    premium generally will be treated as capital loss when the note
    matures.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Market
    Discount</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder purchases a note for an amount that is
    less than its stated redemption price at maturity, or, in the
    case of an OID note, its adjusted issue price, such holder will
    be considered to have purchased the note with &#147;market
    discount.&#148; Any gain on the sale, exchange, retirement, or
    other disposition of a note with market discount generally will
    be treated as ordinary interest income to the extent of the
    market discount not previously included in income that accrued
    on the note during such holder&#146;s holding period. In
    general, market discount is treated as accruing on a
    straight-line basis over the term of the note unless an election
    is made to accrue the market discount under a constant yield
    method. In addition, a U.S.&#160;holder may be required to
    defer, until the maturity of the note or its earlier disposition
    in a taxable transaction, the deduction of a portion of the
    interest paid or accrued on any indebtedness incurred or
    maintained to purchase or carry the note in an amount not
    exceeding the accrued market discount on the note.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A U.S.&#160;holder may elect to include market discount in
    income currently as it accrues (on either a straight-line or
    constant yield basis), in lieu of treating a portion of any gain
    realized on a sale, exchange, retirement, or other disposition
    of the note as ordinary income. If an election is made to
    include market discount on a current basis, the interest
    deduction deferral rule described above will not apply. If a
    U.S.&#160;holder makes such an election, it will apply to all
    market discount debt instruments acquired by such holder on or
    after the first day of the first taxable year to which the
    election applies. The election may not be revoked without the
    consent of the Internal Revenue Service. U.S.&#160;holders
    should consult with their own tax advisors before making this
    election.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If the difference between the stated redemption price at
    maturity of a note or, in the case of an OID note, its adjusted
    issue price, and the amount paid for the note is less than 1/4
    of 1% of the debt instrument&#146;s stated redemption price at
    maturity or, in the case of an OID note, its adjusted issue
    price, multiplied by the number of remaining complete years to
    the note&#146;s maturity (&#147;<I>de minimi</I>s market
    discount&#148;), the note is not treated as having market
    discount.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Generally, a holder may make an election to include in income
    its entire return on a note (<I>i.e.</I>, the excess of all
    remaining payments to be received on the note over the amount
    paid for the note by such holder) in accordance with a constant
    yield method based on the compounding of interest, as discussed
    below under &#147;&#151;U.S.&#160;Holders&#151;Election to Treat
    All Interest as Original Issue Discount.&#148; If a holder makes
    such an election
</DIV>
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    <BR>
    S-35
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    for a note with market discount, the holder will be required to
    include market discount in income currently as it accrues on a
    constant yield basis for all market discount debt instruments
    acquired by such holder on or after the first day of the first
    taxable year to which the election applies, and such election
    may be revoked only with the permission of the Internal Revenue
    Service.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Election
    to Treat All Interest as Original Issue Discount</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A U.S.&#160;holder may elect to include in income all interest
    that accrues on a note using the constant-yield method
    applicable to OID described above, subject to certain
    limitations and exceptions. For purposes of this election,
    interest includes stated interest, acquisition discount, OID,
    <I>de minimis </I>OID, market discount, <I>de minimis </I>market
    discount, and unstated interest, as adjusted by any amortizable
    bond premium or acquisition premium, each as described herein.
    If this election is made for a note, then, to apply the
    constant-yield method: (i)&#160;the issue price of the note will
    equal its cost, (ii)&#160;the issue date of the note will be the
    date it was acquired, and (iii)&#160;no payments on the note
    will be treated as payments of qualified stated interest. A
    U.S.&#160;holder must make this election for the taxable year in
    which the note was acquired, and may not revoke the election
    without the consent of the Internal Revenue Service.
    U.S.&#160;holders should consult with their own tax advisors
    before making this election.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Short-Term
    Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Some of our notes may be issued with maturities of one year or
    less from the date of issue, which we refer to as short-term
    notes. Treasury regulations provide that no payments of interest
    on a short-term note are treated as qualified stated interest.
    Accordingly, in determining the amount of discount on a
    short-term note, all interest payments, including stated
    interest, are included in the short-term note&#146;s stated
    redemption price at maturity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In general, individual and certain other U.S.&#160;holders using
    the cash basis method of tax accounting are not required to
    include accrued discount on short-term notes in income currently
    unless they elect to do so, but they may be required to include
    any stated interest in income as the interest is received.
    However, a cash basis U.S.&#160;holder will be required to treat
    any gain realized on a sale, exchange, or retirement of the
    short-term note as ordinary income to the extent such gain does
    not exceed the discount accrued with respect to the short-term
    note, which will be determined on a straight-line basis unless
    the holder makes an election to accrue the discount under the
    constant-yield method, through the date of sale or retirement.
    In addition, a cash basis U.S.&#160;holder that does not elect
    to currently include accrued discount in income will be not
    allowed to deduct any of the interest paid or accrued on any
    indebtedness incurred or maintained to purchase or carry a
    short-term note (in an amount not exceeding the deferred
    income), but instead will be required to defer deductions for
    such interest until the deferred income is realized upon the
    maturity of the short-term note or its earlier disposition in a
    taxable transaction. Notwithstanding the foregoing, a cash-basis
    U.S.&#160;holder of a short-term note may elect to include
    accrued discount in income on a current basis. If this election
    is made, the limitation on the deductibility of interest
    described in this paragraph will not apply.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A U.S.&#160;holder using the accrual method of tax accounting
    and some cash basis holders (including banks, securities
    dealers, regulated investment companies, and certain trust
    funds) generally will be required to include accrued discount on
    a short-term note in income on a current basis, on either a
    straight-line basis or, at the election of the holder, under the
    constant-yield method based on daily compounding. Regardless of
    whether a U.S.&#160;holder is a cash-basis or accrual-basis
    holder, the holder of a short-term note may elect to include
    accrued &#147;acquisition discount&#148; with respect to the
    short-term note in income on a current basis. Acquisition
    discount is the excess of the remaining redemption amount of the
    short-term note at the time of acquisition over the purchase
    price. Acquisition discount will be treated as accruing on a
    straight-line basis or, at the election of the holder, under a
    constant yield method based on daily compounding. If a
    U.S.&#160;holder elects to include accrued acquisition discount
    in income, the rules for including OID will not apply. In
    addition, the market discount rules described above will not
    apply to short-term notes.
</DIV>
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    <BR>
    S-36
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Sale,
    Exchange, or Retirement of Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon the sale, exchange, retirement, or other disposition of a
    note, a U.S.&#160;holder will recognize gain or loss equal to
    the difference between the amount realized upon the sale,
    exchange, retirement, or other disposition (less an amount equal
    to any accrued interest not previously included in income if the
    note is disposed of between interest payment dates, which will
    be included in income as interest income for U.S.&#160;federal
    income tax purposes) and the U.S.&#160;holder&#146;s adjusted
    tax basis in the note. The amount realized by the
    U.S.&#160;holder will include the amount of any cash and the
    fair market value of any other property received for the note. A
    U.S.&#160;holder&#146;s adjusted tax basis in a note generally
    will be the cost of the note to such U.S.&#160;holder, increased
    by any OID, market discount, <I>de minimis </I>OID, <I>de
    minimis </I>market discount, or any discount with respect to a
    short-term note previously included in income with respect to
    the note, and decreased by the amount of any premium previously
    amortized to reduce interest on the note and the amount of any
    payment (other than a payment of qualified stated interest)
    received in respect of the note.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Except as discussed above with respect to market discount, or as
    described below with respect to
    <FONT style="white-space: nowrap">non-U.S.&#160;dollar</FONT>
    denominated notes, gain or loss realized on the sale, exchange,
    retirement, or other disposition of a note generally will be
    capital gain or loss and will be long-term capital gain or loss
    if the note has been held for more than one year. The ability of
    U.S.&#160;holders to deduct capital losses is subject to
    limitations under the Code.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Notes
    Subject to Contingencies Including Optional Redemption</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Certain of the notes may provide for an alternative payment
    schedule or schedules applicable upon the occurrence of a
    contingency or contingencies, other than a remote or incidental
    contingency, whether such contingency relates to payments of
    interest or of principal. In addition, certain of the notes may
    contain provisions permitting them to be redeemed prior to their
    stated maturity at our option
    <FONT style="white-space: nowrap">and/or</FONT> at
    the option of the holder. Notes containing these features may be
    subject to rules that differ from the general rules discussed
    herein. U.S.&#160;holders considering the purchase of notes with
    these features should carefully examine the applicable
    supplement and should consult their own tax advisors regarding
    the U.S.&#160;federal income tax consequences to a
    U.S.&#160;holder of the ownership and disposition of such notes
    since the U.S.&#160;federal income tax consequences with respect
    to OID will depend, in part, on the particular terms and
    features of the notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Non-U.S.</FONT>
    Dollar Denominated Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Additional considerations apply to a U.S.&#160;holder of a note
    payable in a currency other than U.S.&#160;dollars
    (&#147;foreign currency&#148;). We refer to these notes as
    <FONT style="white-space: nowrap">&#147;Non-U.S.&#160;Dollar</FONT>
    Denominated Notes.&#148; In the case of payments of interest,
    U.S.&#160;holders using the cash method of accounting for
    U.S.&#160;federal income tax purposes will be required to
    include in income the U.S.&#160;dollar value of the foreign
    currency payment on a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note (other than OID or market discount)when the
    payment of interest is received. The U.S.&#160;dollar value of
    the foreign currency payment is determined by translating the
    foreign currency received at the spot rate for such foreign
    currency on the date the payment is received, regardless of
    whether the payment is in fact converted to U.S.&#160;dollars at
    that time. The U.S.&#160;dollar value will be the
    U.S.&#160;holder&#146;s tax basis in the foreign currency
    received. A U.S.&#160;holder will not recognize foreign currency
    exchange gain or loss with respect to the receipt of such
    payment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    U.S.&#160;holders using the accrual method of accounting for
    U.S.&#160;federal income tax purposes will be required to
    include in income the U.S.&#160;dollar value of the amount of
    interest income that has accrued and is otherwise required to be
    taken into account with respect to a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note during an accrual period. The U.S.&#160;dollar
    value of the accrued income will be determined by translating
    the income at the average rate of exchange for the accrual
    period or, with respect to an accrual period that spans two
    taxable years, at the average rate for the partial period within
    the taxable year. A U.S.&#160;holder may elect, however, to
    translate the accrued interest income using the exchange rate on
    the last day of the accrual period or, with respect to an
    accrual period that spans two taxable years, using the exchange
    rate on the last day of the taxable year. If the last day of an
    accrual period is within five business days of the date of
    receipt of the accrued
</DIV>
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    <BR>
    S-37
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    interest, a U.S.&#160;holder may translate the interest using
    the exchange rate on the date of receipt. The above election
    will apply to all other debt obligations held by the
    U.S.&#160;holder and may not be changed without the consent of
    the Internal Revenue Service. U.S.&#160;holders should consult
    their own tax advisors before making the above election. Upon
    receipt of an interest payment (including, upon the sale of the
    note, the receipt of proceeds which include amounts attributable
    to accrued interest previously included in income), the holder
    will recognize foreign currency exchange gain or loss in an
    amount equal to the difference between the U.S.&#160;dollar
    value of such payment (determined by translating the foreign
    currency received at the spot rate for such foreign currency on
    the date such payment is received) and the U.S.&#160;dollar
    value of the interest income previously included in income with
    respect to such payment. This gain or loss will be treated as
    ordinary income or loss.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    OID on a note that is also a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will be determined for any accrual period in
    the applicable foreign currency and then translated into
    U.S.&#160;dollars, in the same manner as interest income accrued
    by a holder on the accrual basis, as described above (regardless
    of such holder&#146;s regular method of accounting). A
    U.S.&#160;holder will recognize foreign currency exchange gain
    or loss when OID is paid (including, upon the sale of such note,
    the receipt of proceeds which include amounts attributable to
    OID previously included in income) to the extent of the
    difference between the U.S.&#160;dollar value of such
    payment(determined by translating the foreign currency received
    at the spot rate for such foreign currency on the date such
    payment is received) and the U.S.&#160;dollar value of the
    accrued OID(determined in the same manner as for accrued
    interest). For these purposes, all receipts on a note will be
    viewed: (i)&#160;first, as the receipt of any stated interest
    payment called for under the terms of the note,
    (ii)&#160;second, as receipts of previously accrued OID (to the
    extent thereof), with payments considered made for the earliest
    accrual periods first, and(iii) third, as the receipt of
    principal.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The amount of market discount on
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Notes includible in income generally will be
    determined by translating the market discount determined in the
    foreign currency into U.S.&#160;dollars at the spot rate on the
    date the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note is retired or otherwise disposed of. If a
    U.S.&#160;holder elected to accrue market discount currently,
    then the amount which accrues is determined in the foreign
    currency and then translated into U.S.&#160;dollars on the basis
    of the average exchange rate in effect during such accrual
    period. A U.S.&#160;holder will recognize foreign currency
    exchange gain or loss with respect to market discount which is
    accrued currently using the approach applicable to the accrual
    of interest income as described above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Amortizable bond premium on a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will be computed in the applicable foreign
    currency. If a U.S.&#160;holder elected to amortize the premium,
    the amortizable bond premium will reduce interest income in the
    applicable foreign currency. At the time bond premium is
    amortized, foreign currency exchange gain or loss will be
    realized based on the difference between spot rates at such time
    and the time of acquisition of the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note. If a U.S.&#160;holder does not elect to
    amortize bond premium, the bond premium computed in the foreign
    currency must be translated into U.S.&#160;dollars at the spot
    rate on the maturity date and such bond premium will constitute
    a capital loss which may be offset or eliminated by foreign
    currency exchange gain.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a U.S.&#160;holder purchases a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note with previously owned foreign currency, foreign
    currency exchange gain or loss (which will be treated as
    ordinary income or loss) will be recognized in an amount equal
    to the difference, if any, between the tax basis in the foreign
    currency and the U.S.&#160;dollar fair market value of the
    foreign currency used to purchase the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note, determined on the date of purchase.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon the sale, exchange, retirement, or other taxable
    disposition of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note, a U.S.&#160;holder will recognize gain or loss
    equal to the difference between the amount realized upon the
    sale, exchange, retirement, or other disposition (less an amount
    equal to any accrued and unpaid interest not previously included
    in income, which will be treated as a payment of interest for
    U.S.&#160;federal income tax purposes) and the adjusted tax
    basis in the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note. The adjusted tax basis in a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will equal the amount paid for the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note, increased by the amounts of any market
    discount or OID previously included in income with respect to
    the
</DIV>
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    <BR>
    S-38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note and reduced by any amortized acquisition or
    other premium and any principal payments received in respect of
    the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note. The amount of any payment in or adjustments
    measured by foreign currency will be equal to the
    U.S.&#160;dollar value of the foreign currency on the date of
    the purchase or adjustment. The amount realized will be based on
    the U.S.&#160;dollar value of the foreign currency on the date
    the payment is received or the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note is disposed of (or deemed disposed of as a
    result of a material change in the terms of the note). If,
    however, a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note is traded on an established securities market
    and the U.S.&#160;holder uses the cash basis method of tax
    accounting, the U.S.&#160;dollar value of the amount realized
    will be determined by translating the foreign currency payment
    at the spot rate of exchange on the settlement date of the
    purchase or sale. A U.S.&#160;holder that uses the accrual basis
    method of tax accounting may elect the same treatment with
    respect to the purchase and sale of
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Notes traded on an established securities market,
    provided that the election is applied consistently.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Except with respect to market discount as discussed above, and
    the foreign currency rules discussed below, gain or loss
    recognized upon the sale, exchange, retirement, or other taxable
    disposition of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will be capital gain or loss and will be
    long-term capital gain or loss if at the time of sale, exchange,
    retirement, or other disposition, the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note has been held for more than one year. Net
    long-term capital gain recognized by an individual
    U.S.&#160;holder is generally taxed at preferential rates. The
    ability of U.S.&#160;holders to deduct capital losses is subject
    to limitations under the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A portion of the gain or loss with respect to the principal
    amount of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note may be treated as foreign currency exchange
    gain or loss. Foreign currency exchange gain or loss will be
    treated as ordinary income or loss. For these purposes, the
    principal amount of the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note is the purchase price for the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note calculated in the foreign currency on the date
    of purchase, and the amount of exchange gain or loss recognized
    is equal to the difference between(i) the U.S.&#160;dollar value
    of the principal amount determined on the date of the sale,
    exchange, retirement or other disposition of the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note and (ii)&#160;the U.S.&#160;dollar value of the
    principal amount determined on the date the foreign currency
    note was purchased. The amount of foreign currency exchange gain
    or loss will be limited to the amount of overall gain or loss
    realized on the disposition of the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The tax basis in foreign currency received as interest on a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will be the U.S.&#160;dollar value of the
    foreign currency determined at the spot rate in effect on the
    date the foreign currency is received. The tax basis in foreign
    currency received on the sale, exchange, retirement, or other
    disposition of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Note will be equal to the U.S.&#160;dollar value of
    the foreign currency, determined at the time of the sale,
    exchange, retirement or other disposition. As discussed above,
    if the
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Notes are traded on an established securities
    market, a cash basis U.S.&#160;holder (or, upon election, an
    accrual basis U.S.&#160;holder) will determine the
    U.S.&#160;dollar value of the foreign currency by translating
    the foreign currency received at the spot rate of exchange on
    the settlement date of the sale, exchange, retirement, or other
    disposition. Accordingly, in such case, no foreign currency
    exchange gain or loss will result from currency fluctuations
    between the trade date and settlement date of a sale, exchange,
    retirement, or other disposition. Any gain or loss recognized on
    a sale, exchange, retirement, or other disposition of foreign
    currency (including its exchange for U.S.&#160;dollars or its
    use to purchase notes) will be ordinary income or loss.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    For the special treatment of
    <FONT style="white-space: nowrap">Non-U.S.&#160;Dollar</FONT>
    Denominated Notes that are also contingent payment notes, see
    the applicable supplement.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Additional
    Medicare Tax on Unearned Income</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    With respect to taxable years beginning after December&#160;31,
    2012, certain U.S.&#160;holders, including individuals, estates
    and trusts, will be subject to an additional 3.8% Medicare tax
    on unearned income. For individual U.S.&#160;holders, the
    additional Medicare tax applies to the lesser of
    (i)&#160;&#147;net investment income&#148; or (ii)&#160;the
    excess of &#147;modified adjusted gross income&#148; over
    $200,000 ($250,000 if married and filing jointly or
</DIV>
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    <BR>
    S-39
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    $125,000 if married and filing separately). &#147;Net investment
    income&#148; generally equals the taxpayer&#146;s gross
    investment income reduced by the deductions that are allocable
    to such income. Investment income generally includes passive
    income such as interest, dividends, annuities, royalties, rents,
    and capital gains. U.S.&#160;holders are urged to consult their
    own tax advisors regarding the implications of the additional
    Medicare tax resulting from an investment in our notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times"><FONT style="white-space: nowrap">Non-U.S.</FONT>
    Holders</FONT></I></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following is a summary of certain U.S.&#160;federal income
    tax consequences that will apply to
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    of notes. As used herein, a Non-U.S.&#160;holder of a note means
    a beneficial owner of a note that for U.S.&#160;federal income
    tax purposes is a non-resident alien individual, a foreign
    corporation, or a foreign estate or trust.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Payments
    of Interest</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under current U.S.&#160;federal income tax law and subject to
    the discussion below concerning backup withholding, principal
    (and premium, if any) and interest payments, including any OID,
    that are received from us or our agent and that are not
    effectively connected with the conduct by the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    of a trade or business within the United States, or a permanent
    establishment maintained in the United States if certain tax
    treaties apply, generally will not be subject to
    U.S.&#160;federal income or withholding tax except as provided
    below. Interest, including any OID, may be subject to a 30%
    withholding tax (or less under an applicable treaty, if any) if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    actually or constructively owns 10% or more of the total
    combined voting power of all classes of our stock entitled to
    vote;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    is a &#147;controlled foreign corporation&#148; for
    U.S.&#160;federal income tax purposes that is related to us
    (directly or indirectly) through stock ownership;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    is a bank extending credit under a loan agreement in the
    ordinary course of its trade or business;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the interest payments on the note are determined by reference to
    the income, profits, changes in the value of property or other
    attributes of the debtor or a related party (other than payments
    that are based on the value of a security or index of securities
    that are, and will continue to be, actively traded within the
    meaning of Section&#160;1092(d) of the Code, and that are not
    nor will be a &#147;United States real property interest&#148;
    as described in Section&#160;897(c)(1) or 897(g) of the
    Code);&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    does not satisfy the certification requirements described below.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    generally will satisfy the certification requirements if either:
    (A)&#160;the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    certifies to us or our agent, under penalties of perjury, that
    it is a
    <FONT style="white-space: nowrap">non-United</FONT>
    States person and provides its name and address (which
    certification may generally be made on an Internal Revenue
    Service
    <FONT style="white-space: nowrap">Form&#160;W-8BEN,</FONT>
    or a successor form), or (B)&#160;a securities clearing
    organization, bank, or other financial institution that holds
    customer securities in the ordinary course of its trade or
    business (a &#147;financial institution&#148;) and holds the
    note certifies to us or our agent under penalties of perjury
    that either it or another financial institution has received the
    required statement from the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    certifying that it is a
    <FONT style="white-space: nowrap">non-United</FONT>
    States person and furnishes us with a copy of the statement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Payments not meeting the requirements set forth above and thus
    subject to withholding of U.S.&#160;federal income tax may
    nevertheless be exempt from withholding (or subject to
    withholding at a reduced rate) if the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    provides us with a properly executed Internal Revenue Service
    <FONT style="white-space: nowrap">Form&#160;W-8BEN</FONT>
    (or successor form) claiming an exemption from, or reduction in,
    withholding under the benefit of a tax treaty, or Internal
    Revenue Service
    <FONT style="white-space: nowrap">Form&#160;W-8ECI</FONT>
    (or other applicable form) stating that interest paid on the
    notes is not subject to withholding tax because it is
    effectively connected with the conduct of a trade or business
    within the United
</DIV>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    States as discussed below. To claim benefits under an income tax
    treaty, a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    must obtain a taxpayer identification number and certify as to
    its eligibility under the appropriate treaty&#146;s limitations
    on benefits article. In addition, special rules may apply to
    claims for treaty benefits made by
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    that are entities rather than individuals. A
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    that is eligible for a reduced rate of U.S.&#160;federal
    withholding tax pursuant to an income tax treaty may obtain a
    refund of any excess amounts withheld by filing an appropriate
    claim for refund with the Internal Revenue Service.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Sale,
    Exchange, or Retirement of Notes</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    generally will not be subject to U.S.&#160;federal income or
    withholding tax on any capital gain or market discount realized
    on the sale, exchange, retirement, or other disposition of
    notes, provided that: (a)&#160;the gain is not effectively
    connected with the conduct of a trade or business within the
    United States, or a permanent establishment maintained in the
    United States if certain tax treaties apply, (b)&#160;in the
    case of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    that is an individual, the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    is not present in the United States for 183&#160;days or more in
    the taxable year of the sale, exchange, or other disposition of
    the note, and (c)&#160;the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    is not subject to tax pursuant to certain provisions of
    U.S.&#160;federal income tax law applicable to certain
    expatriates. An individual
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    who is present in the United States for 183&#160;days or more in
    the taxable year of sale, exchange, or other disposition of a
    note, and if certain other conditions are met, will be subject
    to U.S.&#160;federal income tax at a rate of 30% on the gain
    realized on the sale, exchange, or other disposition of such
    note.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <I><FONT style="font-family: 'Times New Roman', Times">Income
    Effectively Connected with a Trade or Business within the United
    States</FONT></I>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    of a note is engaged in the conduct of a trade or business
    within the United States and if interest (including any OID) on
    the note, or gain realized on the sale, exchange, or other
    disposition of the note, is effectively connected with the
    conduct of such trade or business (and, if certain tax treaties
    apply, is attributable to a permanent establishment maintained
    by the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    in the United States), the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder,</FONT>
    although exempt from U.S.&#160;federal withholding tax (provided
    that the certification requirements discussed above are
    satisfied), generally will be subject to U.S.&#160;federal
    income tax on such interest (including any OID) or gain on a net
    income basis in the same manner as if it were a
    U.S.&#160;holder.
    <FONT style="white-space: nowrap">Non-U.S.&#160;holders</FONT>
    should read the material under the heading
    &#147;&#151;U.S.&#160;Holders,&#148; for a description of the
    U.S.&#160;federal income tax consequences of acquiring, owning,
    and disposing of notes. In addition, if such
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    is a foreign corporation, it may also be subject to a branch
    profits tax equal to 30% (or such lower rate provided by an
    applicable U.S.&#160;income tax treaty) of a portion of its
    earnings and profits for the taxable year that are effectively
    connected with its conduct of a trade or business in the United
    States, subject to certain adjustments.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Backup
    Withholding and Information Reporting</FONT></I></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In general, in the case of a U.S.&#160;holder, other than
    certain exempt holders, we and other payors are required to
    report to the Internal Revenue Service all payments of
    principal, any premium, and interest on the note, and the
    accrual of OID. In addition, we and other payors generally are
    required to report to the Internal Revenue Service any payment
    of proceeds of the sale of a note before maturity. Additionally,
    backup withholding generally will apply to any payments,
    including payments of OID, if a U.S.&#160;holder fails to
    provide an accurate taxpayer identification number and certify
    that the taxpayer identification number is correct, the
    U.S.&#160;holder is notified by the Internal Revenue Service
    that it has failed to report all interest and dividends required
    to be shown on its U.S.&#160;federal income tax returns or a
    U.S.&#160;holder does not certify that it has not underreported
    its interest and dividend income.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the case of a
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder,</FONT>
    backup withholding and information reporting will not apply to
    payments made if the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    provides the required certification that it is not a United
    States person, or the
    <FONT style="white-space: nowrap">Non-U.S.&#160;holder</FONT>
    otherwise establishes an exemption, provided that the payor or
    withholding agent does
</DIV>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    not have actual knowledge that the holder is a United States
    person, or that the conditions of any exemption are not
    satisfied.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, payments of the proceeds from the disposition of a
    note to or through a foreign office of a broker or the foreign
    office of a custodian, nominee, or other dealer acting on behalf
    of a holder generally will not be subject to information
    reporting or backup withholding. However, if the broker,
    custodian, nominee, or other dealer is a United States person,
    the government of the United States or the government of any
    state or political subdivision of any state, or any agency or
    instrumentality of any of these governmental units, a controlled
    foreign corporation for U.S.&#160;federal income tax purposes, a
    foreign partnership that is either engaged in a trade or
    business within the United States or whose United States
    partners in the aggregate hold more than 50% of the income or
    capital interest in the partnership, a foreign person 50% or
    more of whose gross income for a certain period is effectively
    connected with a trade or business within the United States, or
    a United States branch of a foreign bank or insurance company,
    information reporting (but not backup withholding) generally
    will be required with respect to payments made to a holder
    unless the broker, custodian, nominee, or other dealer has
    documentation of the holder&#146;s foreign status and the
    broker, custodian, nominee, or other dealer has no actual
    knowledge to the contrary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Payment of the proceeds from a sale of a note to or through the
    United States office of a broker is subject to information
    reporting and backup withholding, unless the holder certifies as
    to its
    <FONT style="white-space: nowrap">non-United</FONT>
    States person status or otherwise establishes an exemption from
    information reporting and backup withholding.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any amounts withheld under the backup withholding rules will be
    allowed as a refund or a credit against a holder&#146;s
    U.S.&#160;federal income tax liability provided the required
    information is furnished to the Internal Revenue Service.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Guarantee
    Payments</FONT></I></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Payments (if any) made to holders on the notes by UDR LP
    pursuant to the guarantee shall be treated, for
    U.S.&#160;federal income tax purposes, in substantially the same
    manner as payments made on the notes by UDR.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Legislation
    Affecting Taxation of Notes Held by or Through Foreign
    Entities</FONT></I></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Legislation was enacted on March&#160;18, 2010 that will,
    effective for payments made after December&#160;31, 2012, impose
    a 30% U.S.&#160;withholding tax on interest income from debt
    obligations of U.S.&#160;issuers and on the gross proceeds from
    a disposition of such obligations paid to a foreign financial
    institution, unless such institution enters into an agreement
    with the U.S.&#160;Treasury to collect and provide to the
    U.S.&#160;Treasury substantial information regarding
    U.S.&#160;account holders, including certain account holders
    that are foreign entities with U.S.&#160;owners, with such
    institution. The legislation also generally imposes a
    withholding tax of 30% on interest income from such obligations
    and on the gross proceeds from the disposition of such
    obligations paid to a non-financial foreign entity unless such
    entity provides the withholding agent with a certification that
    it does not have any substantial U.S.&#160;owners or a
    certification identifying the direct and indirect substantial
    U.S.&#160;owners of the entity. Under certain circumstances, a
    holder may be eligible for refunds or credits of such taxes.
    These withholding and reporting requirements will generally
    apply to payments made after December&#160;31, 2012; however,
    the withholding tax will not be imposed on payments pursuant to
    obligations outstanding as of March&#160;18, 2012. Investors are
    urged to consult with their own tax advisors regarding the
    possible implications of this recently enacted legislation on
    their investment in the notes.
</DIV>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<A name='D82419108'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">PLAN OF
    DISTRIBUTION (CONFLICTS OF INTEREST)</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under the terms of a second amended and restated distribution
    agreement, dated May&#160;3, 2011, we are offering the notes on
    a continuous basis through or to Citigroup Global Markets Inc.,
    Deutsche Bank Securities Inc., J.P.&#160;Morgan Securities LLC,
    Merrill Lynch, Pierce, Fenner&#160;&#038; Smith Incorporated,
    Morgan Stanley&#160;&#038; Co. Incorporated, and Wells Fargo
    Securities, LLC, referred to in this prospectus supplement
    individually as an &#147;agent&#148; or collectively as the
    &#147;agents.&#148; The agents, individually or in a syndicate,
    may purchase notes, as principal, from us from time to time for
    resale to investors and other purchasers at varying prices
    relating to prevailing market prices at the time of resale as
    determined by the applicable agent or, if so specified in the
    applicable pricing supplement, for resale at a fixed offering
    price. However, we may agree with an agent for that agent to
    utilize its reasonable efforts on an agency basis on our behalf
    to solicit offers to purchase notes at 100% of the principal
    amount thereof, unless otherwise specified in the applicable
    pricing supplement. We will pay a commission to an agent,
    ranging from .125% to .750% of the principal amount of each
    note, depending upon its stated maturity, sold through that
    agent as our agent, unless otherwise agreed. We will negotiate
    commissions with respect to notes with stated maturities in
    excess of 30&#160;years that are sold through an agent as our
    agent at the time of the related sale.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, in the ordinary course of their business
    activities, the agents and their affiliates may make or hold a
    broad array of investments and actively trade debt and equity
    securities (or related derivative securities) and financial
    instruments (including bank loans) for their own account and for
    the accounts of their customers. Such investments and securities
    activities may involve securities
    <FONT style="white-space: nowrap">and/or</FONT>
    instruments of ours or our affiliates. The agents and their
    affiliates may also make investment recommendations
    <FONT style="white-space: nowrap">and/or</FONT>
    publish or express independent research views in respect of such
    securities or financial instruments and may hold, or recommend
    to clients that they acquire, long
    <FONT style="white-space: nowrap">and/or</FONT> short
    positions in such securities and instruments.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any note sold to an agent as principal will be purchased by that
    agent at a price equal to 100% of the principal amount thereof
    less a percentage of the principal amount equal to the
    commission applicable to an agency sale of a note of identical
    maturity. An agent may sell notes it has purchased from us as
    principal to certain dealers less a concession equal to all or
    any portion of the discount received in connection with that
    purchase. An agent may allow, and dealers may reallow, a
    discount to certain other dealers. After the initial offering of
    notes, the offering price (in the case of notes to be resold on
    a fixed offering price basis), the concession and the
    reallowance may be changed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The notes will not have an established trading market when
    issued. Also, the notes will not be listed on any securities
    exchange. An agent may make a market in the notes, as permitted
    by applicable laws and regulations, but is not obligated to do
    so and may discontinue any market-making at any time without
    notice. A secondary market for any notes may not develop, and
    purchasers of notes may not be able to sell notes in the future.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each purchaser of a note will arrange for payment as instructed
    by the relevant agent. The agents are required to deliver the
    proceeds of the notes to us in immediately available funds, to a
    bank designated by us in accordance with the terms of the
    distribution agreement, on the date of settlement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each agent may be deemed to be an &#147;underwriter&#148; within
    the meaning of the Securities Act. We have agreed to indemnify
    the agents against certain liabilities, including liabilities
    under the Securities Act, or to contribute to payments that they
    may be required to make in connection with such indemnification.
    We have agreed to reimburse the agents for certain expenses,
    including the reasonable fees and disbursements of counsel for
    the agents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We reserve the right to withdraw, cancel or modify the offer
    made hereby without notice. We have the right to accept offers
    to purchase notes and may reject any proposed purchase of notes
    as a whole or in part. The agents will have the right, in their
    discretion reasonably exercised, to reject any offer to purchase
    notes, as a whole or in part.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In connection with the purchase of notes by an agent, as
    principal, for resale at a fixed price, such agent may engage in
    transactions that stabilize, maintain or otherwise affect the
    price of the notes. Such transactions may consist of bids or
    purchases of notes for the purpose of pegging, fixing or
    maintaining the
</DIV>
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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    price of the notes. Specifically, such agent may overallot in
    connection with such offering, creating a syndicate short
    position. In addition, such agent may bid for and purchase the
    notes in the open market to cover syndicate short positions or
    to stabilize, maintain or otherwise affect the price of the
    notes. Finally, such agent or its syndicate may reclaim selling
    concessions allowed for distributing of notes in the offering,
    if such agent repurchases previously distributed notes in the
    market to cover overallotments or to stabilize the price of the
    notes. Any of these activities may stabilize or maintain the
    market price of the notes above independent market level. The
    agents are not required to engage in any of these activities and
    may end any of them at any time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Concurrently with the offering of the notes through the agents,
    we may issue other securities as contemplated in the
    accompanying prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The agents and certain of their affiliates may engage in
    commercial or investment banking or advisory services with and
    perform services for us and certain of our affiliates in the
    ordinary course of business. We have a lending relationship with
    U.S.&#160;Bank National Association, the trustee under the
    Indenture for the notes.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Conflicts
    of Interest</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>



<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    It is possible that at least 5% of the net proceeds of an
    offering of notes covered by a pricing supplement will be
    applied to repayment of a loan or loans made to us by one or
    more of the agents or any of their respective affiliates. Under
    the Rules of FINRA, special considerations apply to a public
    offering of securities where at least 5% of the net proceeds
    will be paid to a participating underwriter or any of its
    affiliates. Therefore, any such offering will be conducted
    pursuant to FINRA Rule&#160;5121.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    No underwriter having a conflict of interest under FINRA
    Rule&#160;5121 will confirm sales to any account over which the
    underwriter exercises discretionary authority without the prior
    written approval of the customer to which the account relates.
</DIV>

<A name='D82419109'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">WHERE YOU
    CAN FIND MORE INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We are subject to the information requirements of the Securities
    Exchange Act of 1934, or the &#147;Exchange Act,&#148; which
    means that we are required to file annual, quarterly and current
    reports, proxy statements and other information with the SEC,
    all of which are available at the Public Reference Room of the
    SEC at 100&#160;F&#160;Street, NE, Washington,&#160;D.C. 20549.
    You may also obtain copies of the reports, proxy statements and
    other information from the Public Reference Room of the SEC, at
    prescribed rates, by calling
    <FONT style="white-space: nowrap">1-800-SEC-0330.</FONT>
    The SEC maintains a website at
    <FONT style="white-space: nowrap">http://www.sec.gov</FONT>
    where you can access reports, proxy, information and
    registration statements, and other information regarding
    registrants that file electronically with the SEC. You may also
    access our SEC filings free of charge on our website at
    www.udr.com.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    You should be aware that this prospectus supplement does not
    contain all of the information contained or incorporated by
    reference in that registration statement and its exhibits and
    schedules. You may inspect and obtain the registration
    statement, including exhibits, schedules, reports and other
    information that we have filed with the SEC, as described in the
    preceding paragraph. Statements contained in this prospectus
    supplement concerning the contents of any document we refer you
    to are not necessarily complete and in each instance we refer
    you to the applicable document filed with the SEC for more
    complete information.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    You can inspect our reports, proxy statements and other
    information that we file at the offices of the NYSE at
    20&#160;Broad Street, New York, New York 10005.
</DIV>

<A name='D82419110'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">INCORPORATION
    OF CERTAIN DOCUMENTS BY REFERENCE</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The SEC allows us to &#147;incorporate by reference&#148; the
    information we file with the SEC, which means that we can
    disclose important information to you be referring you to those
    documents. The information incorporated by reference herein is
    an important part of this prospectus supplement and the
    accompanying prospectus. Any statement contained in a document
    which is incorporated by reference in this prospectus
</DIV>
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    <BR>
    S-44
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    supplement and the accompanying prospectus is automatically
    updated and superseded if information contained in this
    prospectus supplement and the accompanying prospectus, or
    information that we later file with the SEC prior to the
    termination of this offering, modifies or replaces this
    information. The following documents filed with the SEC
    (Commission File
    <FONT style="white-space: nowrap">No.&#160;1-10524)</FONT>
    are incorporated by reference in this prospectus supplement and
    the accompanying prospectus, except for any document or portion
    thereof deemed to be &#147;furnished&#148; and not filed in
    accordance with SEC rules:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="7%"></TD>
    <TD width="5%"></TD>
    <TD width="88%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    Our Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the fiscal year ended December&#160;31, 2010, filed with the
    SEC on February&#160;23, 2011;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    Our Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    for the fiscal quarter ended March&#160;31, 2011, filed with the
    SEC on May&#160;3, 2011;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    Our Current Reports on
    <FONT style="white-space: nowrap">Form&#160;8-K,</FONT>
    filed with the SEC on February&#160;7, 2011 (with respect to
    Item 8.01 only), March&#160;2, 2011, March&#160;4, 2011,
    March&#160;31, 2011, April&#160;4, 2011 and May&#160;2, 2011
    (with respect to Items&#160;8.01 and 9.01 only);
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    Our definitive Proxy Statement dated March&#160;31, 2011, and
    definitive Additional Materials filed with the SEC on
    March&#160;31, 2011, both filed in connection with our Annual
    Meeting of Stockholders to be held on May&#160;12, 2011;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    All other reports filed by us pursuant to Section&#160;13(a) or
    15(d) of the Exchange Act since December&#160;31, 2010 (other
    than any document or portion thereof deemed to be
    &#147;furnished&#148; and not &#147;filed&#148; in accordance
    with the rules and regulations of the SEC);&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;&#160;
</TD>
    <TD align="left">
    All other documents and reports we file after the date of this
    prospectus supplement and prior to completion of all offerings
    of the particular securities covered by this prospectus
    supplement pursuant to Sections&#160;13(a), 13(c), 14 or 15(d)
    of the Exchange Act (with the exception of information that is
    deemed &#147;furnished&#148; rather than &#147;filed,&#148;
    which information shall not be deemed incorporated by reference
    herein).
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    As explained above in &#147;Where You Can Find More
    Information,&#148; these incorporated documents (as well as
    other documents filed by us under the Exchange Act) are
    available at the SEC and may be accessed in a number of ways,
    including online via the internet.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will provide without charge to each person, including any
    beneficial owner, to whom this prospectus supplement and the
    accompany prospectus are delivered, a copy of any of the
    documents referred to above by written or oral request to:
</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <FONT style="font-family: 'Times New Roman', Times">UDR, Inc.<BR>
    1745 Shea Center Drive, Suite&#160;200<BR>
    Highlands Ranch, Colorado 80129<BR>
    Attention: Investor Relations<BR>
    Telephone:
    <FONT style="white-space: nowrap">(720)&#160;283-6120</FONT>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We maintain a web site at www.udr.com. The information on our
    website is not considered a part of, or incorporated by
    reference in, this prospectus supplement, the accompanying
    prospectus, or any other document we file with or furnish to the
    SEC.
</DIV>
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    <BR>
    S-45
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<A name='D82419111'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The validity of the notes, including the guarantee, and certain
    U.S.&#160;federal income tax matters will be passed upon for us
    by Morrison&#160;&#038; Foerster LLP, and certain
    U.S.&#160;federal income tax matters will be passed upon for us
    by Kutak Rock LLP. Certain legal matters will be passed upon for
    the agents by Sidley Austin
    <FONT style="font-variant: SMALL-CAPS">llp</FONT>, New York, New
    York. The opinions of Morrison&#160;&#038; Foerster LLP and
    Sidley Austin LLP will be conditioned upon, and subject to
    certain assumptions regarding future action required to be taken
    by us and the Indenture trustee in connection with the issuance
    and sale of any particular notes, the specific terms of the
    notes and other matters which may affect the validity of the
    notes but which cannot be ascertained on the date of such
    opinions.
</DIV>

<A name='D82419112'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The consolidated financial statements of UDR, Inc. appearing in
    UDR, Inc.&#146;s Annual Report
    <FONT style="white-space: nowrap">(Form&#160;10-K)</FONT>
    for the year ended December&#160;31, 2010 (including the
    schedule appearing therein), and the effectiveness of UDR,
    Inc.&#146;s internal control over financial reporting as of
    December&#160;31, 2010 have been audited by Ernst&#160;&#038;
    Young LLP, independent registered public accounting firm, as set
    forth in their reports thereon, included therein, and
    incorporated herein by reference. Such consolidated financial
    statements are incorporated herein by reference in reliance upon
    such reports given on the authority of such firm as experts in
    accounting and auditing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 7%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The consolidated financial statements of United Dominion Realty,
    L.P. as of December&#160;31, 2010 and 2009 and for each of the
    three years in the period ended December&#160;31, 2010
    (including the schedule appearing therein) appearing in UDR,
    Inc.&#146;s Annual Report
    <FONT style="white-space: nowrap">(Form&#160;10-K)</FONT>
    for the year ended December&#160;31, 2010 have been audited by
    Ernst&#160;&#038;&#160;Young&#160;LLP, independent registered
    public accounting firm, as set forth in their report thereon,
    included therein, and incorporated by reference. Such
    consolidated financial statements are incorporated herein by
    reference in reliance upon such report given on the authority of
    such firm as experts in accounting and auditing.
</DIV>
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    <BR>
    S-46
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">PROSPECTUS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <IMG src="d82419b5j8241901.gif" alt="(UDR, INC. LOGO)"><B> </B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 24pt">UDR, INC.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 14pt">COMMON STOCK<BR>
    PREFERRED STOCK<BR>
    DEBT SECURITIES<BR>
    GUARANTEES OF DEBT SECURITIES<BR>
    WARRANTS<BR>
    SUBSCRIPTION RIGHTS<BR>
    PURCHASE CONTRACTS<BR>
    PURCHASE UNITS</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may from time to time offer to sell together or separately in
    one or more offerings:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    common stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    preferred stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    debt securities, which may be senior, subordinated or junior
    subordinated and convertible or non-convertible;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    warrants to purchase common stock, preferred stock or debt
    securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    subscription rights to purchase common stock, preferred stock,
    debt securities or other securities;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    purchase contracts;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    purchase units.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus describes some of the general terms that may
    apply to these securities. We will provide the specific prices
    and terms of these securities in one or more supplements to this
    prospectus at the time of the offering. You should read this
    prospectus and the accompanying prospectus supplement carefully
    before you make your investment decision.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may offer and sell these securities through underwriters,
    dealers or agents or directly to purchasers, on a continuous or
    delayed basis. The securities may also be resold by selling
    security holders. The prospectus supplement for each offering
    will describe in detail the plan of distribution for that
    offering and will set forth the names of any underwriters,
    dealers or agents involved in the offering and any applicable
    fees, commissions or discount arrangements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus may not be used to sell securities unless
    accompanied by a prospectus supplement or a free writing
    prospectus.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Our common stock is listed on the New York Stock Exchange, or
    the NYSE, under the trading symbol &#147;UDR.&#148; Each
    prospectus supplement will indicate if the securities offered
    thereby will be listed on any securities exchange.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 5%; font-size: 12pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Investing in our securities involves a high degree of risk.
    See &#147;Risk Factors&#148; on page&#160;1 before you make your
    investment decision.</B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Neither the Securities and Exchange Commission nor any state
    securities commission has approved or disapproved of these
    securities or determined if this prospectus or the accompanying
    prospectus supplement is truthful or complete. Any
    representation to the contrary is a criminal offense.</B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The date of this prospectus is December&#160;8, 2008.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always">&nbsp;</H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">TABLE OF
    CONTENTS</FONT></B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>
<DIV align="left">
<!-- TOC -->
</DIV>

<DIV align="left">
<A name="J82419tocpage"></A>
</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="97%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadleft -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=maindata -->
    <TD width="1%">&nbsp;</TD>	<!-- colindex=02 type=quadright -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Page</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419113'>ABOUT THIS PROSPECTUS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    ii
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419114'>UDR, INC.&#160;</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419115'>RISK FACTORS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419116'>USE OF PROCEEDS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419117'>RATIO OF EARNINGS TO FIXED CHARGES</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    1
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419118'>DESCRIPTION OF SECURITIES</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419119'>DESCRIPTION OF CAPITAL STOCK</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    2
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419120'>DESCRIPTION OF DEBT SECURITIES</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    10
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419121'>DESCRIPTION OF GUARANTEES OF THE DEBT
    SECURITIES</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419122'>DESCRIPTION OF WARRANTS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    23
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419123'>DESCRIPTION OF SUBSCRIPTION RIGHTS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    24
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419124'>DESCRIPTION OF PURCHASE CONTRACTS AND PURCHASE
    UNITS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    25
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419125'>FEDERAL INCOME TAX CONSIDERATIONS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    26
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419126'>SELLING SECURITY HOLDERS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419127'>PLAN OF DISTRIBUTION</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    42
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419128'>LEGAL MATTERS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD nowrap align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419129'>EXPERTS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419130'>CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
    STATEMENTS</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    46
</TD>
<TD>&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    <A HREF='#J82419131'>WHERE YOU CAN FIND MORE INFORMATION</A>
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD>&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    47
</TD>
<TD>&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV align="left">
<!-- /TOC -->
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='J82419113'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">ABOUT
    THIS PROSPECTUS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus is part of a registration statement that we
    filed with the Securities and Exchange Commission (the
    &#147;SEC&#148;) using a &#147;shelf&#148; registration process.
    Under the shelf process, we may sell any combination of the
    securities described in this prospectus in one or more offerings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus only provides you with a general description of
    the securities we may offer. Each time we sell securities, we
    will provide a supplement to this prospectus that will contain
    specific information about the terms of that offering, including
    the specific amounts, prices and terms of the securities
    offered. The prospectus supplement may also add, update or
    change information contained in this prospectus. You should
    carefully read both this prospectus and any accompanying
    prospectus supplement or other offering materials, together with
    the additional information described under the heading
    &#147;Where You Can Find More Information.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    You should rely only on the information contained or
    incorporated by reference in this prospectus. We have not
    authorized anyone to provide you with different information. If
    anyone provides you with different or inconsistent information,
    you should not rely on it. We are not making an offer to sell
    these securities in any jurisdiction where the offer or sale is
    not permitted.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus and any accompanying prospectus supplement or
    other offering materials do not contain all of the information
    included in the registration statement as permitted by the rules
    and regulations of the SEC. For further information, we refer
    you to the registration statement on
    <FONT style="white-space: nowrap">Form&#160;S-3,</FONT>
    including its exhibits. We are subject to the informational
    requirements of the Securities Exchange Act of 1934, as amended
    (&#147;Exchange Act&#148;), and, therefore, file reports and
    other information with the SEC. Statements contained in this
    prospectus and any accompanying prospectus supplement or other
    offering materials about the provisions or contents of any
    agreement or other document are only summaries. If SEC rules
    require that any agreement or document be filed as an exhibit to
    the registration statement, you should refer to that agreement
    or document for its complete contents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    You should not assume that the information in this prospectus,
    any prospectus supplement or any other offering materials is
    accurate as of any date other than the date on the front of each
    document. Our business, financial condition, results of
    operations and prospects may have changed since then.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In this prospectus, unless otherwise specified or the context
    requires otherwise, we use the terms &#147;UDR,&#148; the
    &#147;Company,&#148; &#147;we,&#148; &#147;us&#148; and
    &#147;our&#148; to refer to UDR, Inc.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    ii
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<A name='J82419114'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">UDR,
    INC.</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We are a self-administered real estate investment trust, or
    REIT, that owns, acquires, renovates, develops and manages
    apartment communities nationwide. As of September&#160;30, 2008,
    we owned 44,223 apartment homes and had 2,047 wholly-owned homes
    under active development and another 684 homes under contract
    for development in our pre-sale program.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We have elected to be taxed as a REIT under the applicable
    provisions of the Internal Revenue Code of 1986, or the
    &#147;Code.&#148; To continue to qualify as a REIT under the
    Code, we must continue to meet certain tests which, among other
    things, generally require that our assets consist primarily of
    real estate assets, our income be derived primarily from real
    estate assets, and that we distribute at least 90% of our REIT
    taxable income (other than our net capital gain) to our
    stockholders. As a qualified REIT, we generally will not be
    subject to U.S.&#160;federal income taxes on our REIT taxable
    income to the extent we distribute such income to our
    stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We were formed in 1972 as a Virginia corporation and
    reincorporated in the State of Maryland in June 2003. Our
    principal offices are located at 1745 Shea Center Drive,
    Suite&#160;200, Highlands Ranch, Colorado 80129 and our
    telephone number at that address is
    <FONT style="white-space: nowrap">(720)&#160;283-6120.</FONT>
    Our website address is www.udr.com. The information on, or
    accessible through, our website is not part of this prospectus
    and should not be relied upon in connection with making any
    investment decision with respect to the securities offered by
    this prospectus.
</DIV>

<A name='J82419115'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">RISK
    FACTORS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    You should consider the specific risks described in our Annual
    Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended December&#160;31, 2007, our Quarterly Report
    on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    for the quarter ended September&#160;20, 2008, the risk factors
    described under the caption &#147;Risk Factors&#148; in any
    applicable prospectus supplement and any risk factors set forth
    in our other filings with the SEC, pursuant to
    Sections&#160;13(a), 13(c), 14 or 15(d) of the Exchange Act,
    before making an investment decision. Each of the risks
    described in these documents could materially and adversely
    affect our business, financial condition, results of operations
    and prospects, and could result in a partial or complete loss of
    your investment. See &#147;Where You Can Find More
    Information&#148; beginning on page&#160;47 of this prospectus.
</DIV>

<A name='J82419116'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">USE OF
    PROCEEDS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless we state otherwise in the applicable prospectus
    supplement, we intend to use the net proceeds from the sale of
    the securities offered by this prospectus and the accompanying
    prospectus supplement for general corporate purposes. General
    corporate purposes may include additions to working capital,
    capital expenditures, repayment of debt, funding improvements to
    properties, and acquiring and developing additional properties.
    Pending application of the net proceeds, we intend to invest the
    proceeds in interest bearing accounts and short-term, interest
    bearing securities. Unless otherwise set forth in a prospectus
    supplement, we will not receive any proceeds in the event that
    the securities are sold by a selling security holder.
</DIV>

<A name='J82419117'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">RATIO OF
    EARNINGS TO FIXED CHARGES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following table sets forth our ratio of earnings to combined
    fixed charges and preferred stock dividends for the periods
    indicated:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE border="0" width="100%" align="center" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
<!-- Table Width Row BEGIN -->
<TR style="font-size: 1pt" valign="bottom">
    <TD width="71%">&nbsp;</TD>	<!-- colindex=01 type=maindata -->
    <TD width="2%">&nbsp;</TD>	<!-- colindex=02 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=02 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=02 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=03 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=03 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=03 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=04 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=04 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=04 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=05 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=05 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=05 type=hang1 -->
    <TD width="3%">&nbsp;</TD>	<!-- colindex=06 type=gutter -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=lead -->
    <TD width="1%" align="right">&nbsp;</TD>	<!-- colindex=06 type=body -->
    <TD width="1%" align="left">&nbsp;</TD>	<!-- colindex=06 type=hang1 -->
</TR>
<!-- Table Width Row END -->
<!-- TableOutputHead -->
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="19" align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>Years Ended December&#160;31,</B>
</TD>
</TR>
<TR style="font-size: 8pt" valign="bottom" align="center">
<TD nowrap align="center" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2007</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2006</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2005</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2004</B>
</TD>
<TD>
&nbsp;
</TD>
<TD colspan="3" nowrap align="center" valign="bottom" style="border-bottom: 1px solid #000000">
    <B>2003</B>
</TD>
</TR>
<TR style="line-height: 3pt; font-size: 1pt">
<TD>&nbsp;
</TD>
</TR>
<!-- TableOutputBody -->
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ratio of earnings to fixed charges(1)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
<TR valign="bottom">
<TD align="left" valign="bottom">
<DIV style="text-indent: -10pt; margin-left: 10pt">
    Ratio of earnings to combined fixed charges and preferred stock
    dividend(2)
</DIV>
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
<TD>
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
&nbsp;
</TD>
<TD nowrap align="right" valign="bottom">
    &#151;
</TD>
<TD nowrap align="left" valign="bottom">
&nbsp;
</TD>
</TR>
</TABLE>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV style="font-size: 1pt; margin-left: 0%; width: 13%;  align: left; border-bottom: 1pt solid #000000"></DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>



<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (1) </TD>
    <TD></TD>
    <TD valign="bottom">
    For each of the years ended December&#160;31, 2003, 2004, 2005,
    2006 and 2007, the ratio of earnings to fixed charges was
    deficient of achieving a 1:1 ratio by $61.0&#160;million,
    $59.0&#160;million, $66.3&#160;million, $97.0&#160;million and
    $41,000.</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    1
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

<TR>
    <TD width="2%"></TD>
    <TD width="1%"></TD>
    <TD width="97%"></TD>
</TR>

<TR>
    <TD align="right" valign="top">
    (2) </TD>
    <TD></TD>
    <TD valign="bottom">
    For each of the years ended December&#160;31, 2003, 2004, 2005,
    2006 and 2007, the ratio of earnings to combined fixed charges
    and preferred stock dividend was deficient of achieving a 1:1
    ratio by $106.6&#160;million, $84.2&#160;million,
    $81.6&#160;million, $112.4&#160;million and $16.2&#160;million,
    respectively.</TD>
</TR>

</TABLE>

<A name='J82419118'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF SECURITIES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus contains summary descriptions of the common
    stock, preferred stock, debt securities, guarantees of debt
    securities, warrants, subscription rights, purchase contracts
    and purchase units that we may offer and sell from time to time.
    These summary descriptions are not meant to be complete
    descriptions of each security. The particular terms of any
    security will be described in the applicable prospectus
    supplement.
</DIV>

<A name='J82419119'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF CAPITAL STOCK</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Our authorized capital stock consists of 250,000,000&#160;shares
    of common stock, par value $0.01&#160;per share,
    50,000,000&#160;shares of preferred stock, without par value,
    and 300,000,000&#160;shares of Excess Stock, par value
    $0.01&#160;per share. As of November&#160;1, 2008,
    136,180,801&#160;shares of our common stock were issued and
    outstanding and 28,614,528&#160;shares of our common stock
    reserved for issuance upon exercise of outstanding stock
    options, convertible notes, convertible preferred stock and
    operating partnership units exchangeable for our common stock.
    We currently have four designated series of Preferred Stock that
    are outstanding or could be issued. We have designated
    1,000,000&#160;shares as Series&#160;C Junior Participating
    Cumulative Redeemable Preferred Stock (&#147;Series&#160;C
    Preferred Stock&#148;) for use in connection with our First
    Amended and Restated Rights Agreement, dated September&#160;14,
    1999, which expired on February&#160;4, 2008. We have designated
    2,803,812&#160;shares as Series&#160;E Cumulative Convertible
    Preferred Stock (&#147;Series&#160;E Preferred Stock&#148;), of
    which 2,803,812&#160;shares were outstanding as of
    September&#160;30, 2008. We have designated
    20,000,000&#160;shares as Series&#160;F Preferred Stock
    (&#147;Series&#160;F Preferred Stock), none of which were
    outstanding as of September&#160;30, 2008. We have designated
    6,000,000&#160;shares as 6.75% Series&#160;G Cumulative
    Redeemable Preferred Stock (&#147;Series&#160;G Preferred
    Stock&#148;), of which 4,430,700&#160;shares were outstanding as
    of September&#160;30, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following is a description of our capital stock and certain
    provisions of our charter, bylaws and certain provisions of
    applicable law. The following is only a summary and is qualified
    by applicable law and by the provisions of our charter and
    bylaws, copies of which are included as exhibits to the
    registration statement of which this prospectus forms a part.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Common
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We have one class of common stock. All holders of our common
    stock are entitled to the same rights and privileges, as
    described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Voting Rights.</I>&#160;&#160;Holders of our common stock are
    entitled to one vote per share with respect to each matter
    presented to our stockholders on which the holders of common
    stock are entitled to vote and do not have cumulative voting
    rights. An election of directors by our stockholders is
    determined by a plurality of the votes cast by the stockholders
    entitled to vote on the election.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Dividends.</I>&#160;&#160;Holders of our common stock are
    entitled to receive proportionately any dividends as may be
    declared by our board of directors, subject to any preferential
    dividend rights of outstanding preferred stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Liquidation and Dissolution.</I>&#160;&#160;In the event of
    our liquidation or dissolution, the holders of our common stock
    are entitled to receive ratably all assets available for
    distribution to stockholders after the payment of all debts and
    other liabilities and subject to the prior rights of any
    outstanding preferred stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Other Rights.</I>&#160;&#160;Holders of our common stock have
    no preemptive, subscription, redemption or conversion rights.
    The rights, preferences and privileges of holders of our common
    stock are subject to and may be adversely affected by the rights
    of the holders of shares of any series of preferred stock that
    we may designate and issue in the future.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    2
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Restrictions on Ownership and Transfer.</I>&#160;&#160;Our
    charter contains ownership and transfer restrictions relating to
    our stock that are designed primarily to preserve our status as
    a REIT. These restrictions include but are not limited to the
    following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    no person may beneficially own or constructively own shares of
    our outstanding &#147;equity stock&#148; (defined as stock that
    is either common stock or preferred stock) with a value in
    excess of 9.9% of the value of all outstanding equity stock
    unless our board of directors exempts the person from such
    ownership limitation, provided that any such exemption shall not
    allow the person to exceed 13% of the value of our outstanding
    equity stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transfer that, if effective, would result in any person
    beneficially owning or constructively owning equity stock with a
    value in excess of 9.9% of the value of all outstanding equity
    stock (or such higher value not to exceed 13% as determined
    pursuant to an exemption from our board of directors) shall be
    void as to the transfer of that number of shares of equity stock
    which would otherwise be beneficially owned or constructively
    owned by such person in excess of such ownership limit; and the
    intended transferee shall acquire no rights in such excess
    shares of equity stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    except as provided in the charter, any transfer that, if
    effective, would result in the equity stock being beneficially
    owned by fewer than 100&#160;persons shall be void as to the
    transfer of that number of shares which would be otherwise
    beneficially owned or constructively owned by the transferee;
    and the intended transferee shall acquire no rights in such
    excess shares of equity stock;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any transfer of shares of equity stock that, if effective, would
    result in us being &#147;closely held&#148; within the meaning
    of Section&#160;856(h) of the Internal Revenue Code of 1986
    shall be void as to the transfer of that number of shares of
    equity stock which would cause us to be &#147;closely held&#148;
    within the meaning of Section&#160;856(h) of the Internal
    Revenue Code of 1986; and the intended transferee shall acquire
    no rights in such excess shares of equity stock.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Listing.</I>&#160;&#160;Our common stock is listed on the
    NYSE under the symbol &#147;UDR.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Transfer Agent and Registrar.</I>&#160;&#160;The transfer
    agent and registrar for our common stock is Wells Fargo Bank,
    N.A., 161 North Concord Exchange, South St. Paul, Minnesota
    55075.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Preferred
    Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under our charter we are authorized to issue up to
    50,000,000&#160;shares of preferred stock, without par value, in
    one or more series. Our board of directors may authorize the
    issuance of preferred stock in one or more series and may
    determine, with respect to any such series, the powers,
    preferences and rights of such series, and its qualifications,
    limitations and restrictions. We currently have four designated
    series of Preferred Stock that are outstanding or could be
    issued. We have designated 1,000,000&#160;shares as
    Series&#160;C Preferred Stock for use in connection with our
    First Amended and Restated Rights Agreement, dated
    September&#160;14, 1999, which expired on February&#160;4, 2008.
    We have designated 2,803,812&#160;shares as Series&#160;E
    Preferred Stock, of which 2,803,812&#160;shares were outstanding
    as of September&#160;30, 2008. We have designated
    20,000,000&#160;shares as Series&#160;F Preferred Stock, none of
    which were outstanding as of September&#160;30, 2008. We have
    designated 6,000,000&#160;shares as Series&#160;G Preferred
    Stock, of which 4,430,700&#160;shares were outstanding as of
    September&#160;30, 2008.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement relating to any series of preferred
    stock that we may offer will contain the specific terms of the
    preferred stock. These terms may include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the title of the series and the number of shares in the series;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price at which the preferred stock will be offered;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the dividend rate or rates or method of calculating the rates,
    the dates on which the dividends will be payable, whether or not
    dividends will be cumulative or non-cumulative and, if
    cumulative, the dates from which dividends on the preferred
    stock being offered will cumulate;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the voting rights, if any, of the holders of shares of the
    preferred stock being offered;
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    3
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the provisions for a sinking fund, if any, and the provisions
    for redemption, if applicable, of the preferred stock being
    offered;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the liquidation preference per share;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the terms and conditions, if applicable, upon which the
    preferred stock being offered will be convertible into our
    common stock, including the conversion price, or the manner of
    calculating the conversion price, and the conversion period;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the terms and conditions, if applicable, upon which the
    preferred stock being offered will be exchangeable for debt
    securities, including the exchange price, or the manner of
    calculating the exchange price, and the exchange period;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any listing of the preferred stock being offered on any
    securities exchange;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether interests in the shares of the series will be
    represented by depositary shares;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a discussion of any material U.S.&#160;federal income tax
    considerations applicable to the preferred stock being offered;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the relative ranking and preferences of the preferred stock
    being offered as to dividend rights and rights upon liquidation,
    dissolution or the winding up of our affairs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any limitations on the issuance of any class or series of
    preferred stock ranking senior or equal to the series of
    preferred stock being offered as to dividend rights and rights
    upon liquidation, dissolution or the winding up of our affairs;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    information with respect to book-entry procedures, if
    any;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any additional rights, preferences, qualifications, limitations
    and restrictions of the series.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon issuance, the shares of preferred stock will be fully paid
    and nonassessable, which means that its holders will have paid
    their purchase price in full, and we may not require them to pay
    additional funds. Holders of preferred stock will not have any
    preemptive rights.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Series&#160;E
    Preferred Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Ranking.</I>&#160;&#160;The Series&#160;E Preferred Stock
    ranks <I>pari passu </I>with the Series&#160;G Preferred Stock
    and any of our other capital stock designated as ranking on
    parity with the Series&#160;E Preferred Stock and the
    Series&#160;G Preferred Stock (collectively, &#147;Parity
    Stock&#148;), with respect to payment of dividends and amounts
    upon liquidation, dissolution or winding up, and senior to our
    common stock, the Series&#160;F Preferred Stock and any other
    class of our capital stock now or hereafter issued and
    outstanding that ranks junior as to the payment of dividends or
    amounts upon liquidation, dissolution and winding up to the
    Series&#160;E Preferred Stock or any Parity Stock (collectively,
    &#147;Junior Stock&#148;). While any shares of Series&#160;E
    Preferred Stock are outstanding, we may not authorize or create
    any class or series of capital stock that ranks senior to the
    Series&#160;E Preferred Stock with respect to the payment of
    dividends or amounts upon liquidation, dissolution or winding
    up, or reclassify any of our authorized capital stock into any
    such shares, or create, authorize or issue any obligation or
    security convertible into or evidencing the right to purchase
    any such shares, without the consent of the holders of a
    majority of the outstanding Series&#160;E Preferred Stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Dividends.</I>&#160;&#160;Holders of the Series&#160;E
    Preferred Stock are entitled to receive, out of funds legally
    available for payment, cumulative preferential cash dividends at
    an annual rate of 8% of the liquidation preference (equivalent
    to $1.3288&#160;per share of Series&#160;E Preferred Stock),
    until such time as the dividend on the common stock is equal to
    or exceeds this amount for four consecutive calendar quarters,
    at which time the dividends will adjust to match the dividend on
    the common stock. Dividends on each share of Series&#160;E
    Preferred Stock accrue and are cumulative from and including the
    date of original issue and are paid quarterly in arrears on the
    last day, or the next business day, of January, April, July and
    October, commencing July&#160;31, 2003. Dividends on each share
    of Series&#160;E Preferred Stock are cumulative to the extent
    not declared and paid in full whether or not there exists funds
    legally available for the payment of such dividends or such
    dividends have been authorized. Accumulations of dividends on
    the Series&#160;E Preferred Stock do not bear interest and
    holders of the Series&#160;E Preferred Stock are not entitled to
    any dividends in
</DIV>
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    <BR>
    4
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    excess of full cumulative dividends. Dividends payable on the
    Series&#160;E Preferred Stock for any partial dividend period
    will be computed on the basis of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    consisting of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months. Dividends payable on the Series&#160;E Preferred Stock
    for each full dividend period are computed by dividing the
    annual dividend rate by four.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Until such time as the dividend on the common stock is equal to
    or exceeds $1.3288&#160;per share per annum for four consecutive
    calendar quarters, no dividend (other than in Junior Stock) will
    be declared or paid on any Junior Stock unless full cumulative
    dividends have been declared and paid or are contemporaneously
    declared and funds sufficient for payment set aside on the
    Series&#160;E Preferred Stock for all prior dividend periods,
    nor shall any Junior Stock or any Parity Stock be redeemed,
    purchased or otherwise acquired for any consideration (or any
    moneys paid to or made available for a sinking fund for
    redemption of any shares of Junior Stock or Parity Stock)
    (except by conversion into or exchange for other Junior Stock or
    Parity Stock).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may not declare, pay or set apart funds for the payment of
    any dividend on share of Series&#160;E Preferred Stock at such
    time as the terms and provisions of any agreement to which we
    are bound, including any agreement relating to out indebtedness,
    prohibits such declaration, payment or setting apart for payment
    or provides that such declaration, payment or setting apart for
    payment would constitute a breach or a default under such an
    agreement, or if such declaration or payment is restricted or
    prohibited by law.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Liquidation Preference.</I>&#160;&#160;The holders of
    Series&#160;E Preferred Stock are entitled to receive in the
    event of any liquidation, dissolution or winding up of UDR,
    whether voluntary or involuntary, $16.61&#160;per share of
    Series&#160;E Preferred Stock, which we refer to in this
    prospectus as the &#147;Series&#160;E Liquidation
    Preference,&#148; plus an amount per share of Series&#160;E
    Preferred Stock equal to all dividends (whether or not earned or
    declared) accrued and unpaid thereon to, but not including, the
    date of final distribution to such holders. If, upon any
    liquidation, dissolution or winding up of UDR, the Series&#160;E
    Liquidation Preference and any amounts payable as a liquidation
    preference to other shares of Parity Stock are not paid in full,
    the holders of the shares of the Series&#160;E Preferred Stock
    and any such Parity Stock will share ratably in the distribution
    of our assets in proportion to the full respective liquidation
    preferences to which they are entitled.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Voting Rights.</I>&#160;&#160;The holders of our outstanding
    Series&#160;E Preferred Stock are entitled to vote on an
    &#147;as converted&#148; (one-for-one) basis as a single class
    in combination with the holders of our common stock at any
    meeting of stockholders for the election of directors or for any
    other purpose on which holders of our common stock are entitled
    to vote.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Conversion Rights.</I>&#160;&#160;Each share of the
    Series&#160;E Preferred Stock is convertible into one share of
    common stock. No fractional shares will be issued upon
    conversion of the Series&#160;E Preferred Stock. In lieu of
    issuing fractional shares that would otherwise be deliverable
    upon the conversion of one share of Series&#160;E Preferred
    Stock, we will pay to the holder of such share an amount in cash
    equal to such fraction multiplied by the closing sale price on
    the trading day immediately preceding the date of conversion.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If after the original date of issue we make or issue, or fix a
    record date for the holders of our common stock entitled to
    receive, a dividend or other distribution payable in securities
    issued by us, then and in each event, we shall make such
    provision so that each holder of Series&#160;E Preferred Stock
    will be entitled to receive, upon conversion of the
    Series&#160;E Preferred Stock, in addition to the shares of our
    common stock receivable upon conversion, such number of such
    securities as such holder would have received if the holder had
    converted the Series&#160;E Preferred Stock immediately prior to
    the date of such event and had continued to hold such securities
    until the conversion date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Listing.</I>&#160;&#160;The Series&#160;E Preferred Stock is
    not listed on any exchange.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Transfer Agent, Registrar, Dividend Disbursing Agent and
    Redemption&#160;Agent.</I>&#160;&#160;The transfer agent,
    registrar, dividend disbursing agent and redemption agent for
    the Series&#160;E Preferred Stock is Wells Fargo Bank, N.A.,
    South St. Paul, Minnesota.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Series&#160;F
    Preferred Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Ranking.</I>&#160;&#160;In respect of rights to receive
    dividends and to participate in distributions or payments in the
    event of any liquidation, dissolution or winding up of the
    Corporation, the Series&#160;F Preferred Stock ranks junior to
    the common stock and any other class or series of capital stock.
</DIV>
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    <BR>
    5
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>No Dividends or Liquidation Rights.</I>&#160;&#160;The
    Series&#160;F Preferred Stock is not entitled to receive
    dividends or otherwise participate in our earnings or assets.
    Upon a voluntary or involuntary dissolution, liquidation or
    winding up, the holders of shares of the Series&#160;F Preferred
    Stock then outstanding will not be entitled to receive or be
    paid out of the assets of the corporation legally available for
    distribution to its stockholders. The holders of the
    Series&#160;F Preferred Stock as such will have no right or
    claim to any of our assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Voting Rights.</I>&#160;&#160;Except as otherwise required by
    law or provided in our charter, and subject to the express terms
    of any other series of Preferred Stock, each share of
    Series&#160;F Preferred Stock will entitle the holder thereof to
    one vote for each share of Series&#160;F Preferred Stock held by
    such holder on each matter submitted to a vote at a meeting of
    the stockholders upon which holders of common stock are entitled
    to vote. The holders of Series&#160;F Preferred Stock will be
    entitled to receive notice of all meetings of the stockholders
    at which the holders of common stock are entitled to such notice.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Conversion Rights.</I>&#160;&#160;The Series&#160;F Preferred
    Stock is not convertible into or exchangeable for any other
    property or securities of the corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Redemption.</I>&#160;&#160;The holders of Series&#160;F
    Preferred Stock will not have any right to redeem their shares
    of Series&#160;F Preferred Stock. Each share of Series&#160;F
    Preferred Stock will automatically be redeemed by UDR for no
    consideration without notice to its holder and without further
    action by UDR if either (A)&#160;the Partnership Unit (as
    defined in that certain Amended and Restated Agreement of
    Limited Partnership of United Dominion Realty, L.P., dated as of
    February&#160;23, 2004)&#160;or (B)&#160;the Limited
    Partnership&#160;Interest (as defined in that certain Second
    Amended and Restated Agreement of Limited Partnership of
    Heritage Communities L.P., dated as of September&#160;18,
    1997)&#160;underlying such share of Series&#160;F Preferred
    Stock is no longer outstanding.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Series&#160;G
    Preferred Stock</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Ranking.</I>&#160;&#160;The Series&#160;G Preferred Stock
    ranks senior to the Junior Stock, including shares of our common
    stock and the Series&#160;F Preferred Stock, with respect to
    payment of dividends and amounts upon liquidation, dissolution
    or winding up. While any shares of Series&#160;G Preferred Stock
    are outstanding, we may not authorize or create any class or
    series of capital stock that ranks senior to the Series&#160;G
    Preferred Stock with respect to the payment of dividends or
    amounts upon liquidation, dissolution or winding up without the
    consent of the holders of two-thirds of the outstanding
    Series&#160;G Preferred Stock voting as a single class. However,
    we may create additional classes or series of stock, amend our
    charter to increase the authorized number of shares of preferred
    stock or issue series of Parity Stock without the consent of any
    holder of Series&#160;G Preferred Stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Dividends.</I>&#160;&#160;Holders of Series&#160;G Preferred
    Stock are entitled to receive, when, as and if authorized by our
    board of directors, out of funds legally available for payment,
    and declared by us, cumulative cash dividends at the annual rate
    of 6.75%&#160;per share of its liquidation preference
    (equivalent to $1.6875&#160;per annum per share of Series&#160;G
    Preferred Stock). However, if following a &#147;change of
    control&#148; (as defined below), the Series&#160;G Preferred
    Stock is not listed on the NYSE or the American Stock Exchange
    or quoted on NASDAQ (or listed or quoted on a successor exchange
    or quotation system), holders of the Series&#160;G Preferred
    Stock will be entitled to receive, when and as authorized by our
    board of directors and declared by us, out of funds legally
    available for the payment of dividends, cumulative cash
    dividends from, but not including, the first date on which both
    the change of control has occurred and the Series&#160;G
    Preferred Stock is not so listed or quoted at the increased
    annual rate of 7.75% of its liquidation preference, equivalent
    to $1.9375&#160;per annum per share of Series&#160;G Preferred
    Stock for as long as the Series&#160;G Preferred Stock is not so
    listed or quoted. Dividends on each share of Series&#160;G
    Preferred Stock are cumulative from the date of original issue
    and are payable quarterly in arrears on or about the
    30th&#160;of each January, April, July and October, commencing
    on or about July&#160;30, 2007 at the then applicable annual
    rate. Each dividend is payable to holders of record as they
    appear on our stock records at the close of business on the
    record date, not exceeding 30&#160;days preceding the payment
    dates thereof, as fixed by our board of directors. Dividends are
    cumulative from the most recent dividend payment date to which
    dividends have been paid, whether or not in any dividend period
    or periods there shall be funds legally available for the
    payment of such dividends. Accumulations of dividends on the
    Series&#160;G Preferred Stock do not bear interest and holders
    of the Series&#160;G Preferred Stock are not entitled to any
    dividends in excess of full cumulative dividends. Dividends
    payable on the Series&#160;G Preferred Stock for any period
    greater or less than a full dividend period will be computed on
    the basis of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    consisting of twelve
</DIV>
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    <BR>
    6
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <FONT style="white-space: nowrap">30-day</FONT>
    months. Dividends payable on the Series&#160;G Preferred Stock
    for each full dividend period are computed by dividing the
    annual dividend rate by four.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    No dividend will be declared or paid on any Parity Stock unless
    full cumulative dividends have been declared and paid or are
    contemporaneously declared and funds sufficient for payment set
    aside on the Series&#160;G Preferred Stock for all prior
    dividend periods; provided, however, that if accrued dividends
    on the Series&#160;G Preferred Stock for all prior dividend
    periods have not been paid in full or a sum sufficient for such
    payment is not set apart, then any dividend declared on the
    Series&#160;G Preferred Stock for any dividend period and on any
    Parity Stock will be declared ratably in proportion to accrued
    and unpaid dividends on the Series&#160;G Preferred Stock and
    such Parity Stock. All of our dividends on the Series&#160;G
    Preferred Stock, including any capital gain dividends, will be
    credited first to the earliest accrued and unpaid dividend date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may not (i)&#160;declare, pay or set apart funds for the
    payment of any dividend or other distribution with respect to
    any Junior Stock (other than a dividend or distribution payable
    in Junior Stock) or (ii)&#160;redeem, purchase or otherwise
    acquire for consideration any Junior Stock through a sinking
    fund or otherwise (other than a redemption or purchase or other
    acquisition of shares of common stock made for purposes of an
    employee incentive or benefit plan of UDR or any subsidiary, or
    a conversion into or exchange for Junior Stock or redemptions
    for the purpose of preserving our qualification as a REIT),
    unless all cumulative dividends with respect to the
    Series&#160;G Preferred Stock and any Parity Stock at the time
    such dividends are payable have been paid or funds have been set
    apart for payment of such dividends.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    As used herein, the term &#147;dividend&#148; does not include
    dividends payable solely in Junior Stock on Junior Stock, or in
    options, warrants or rights to holders of Junior Stock to
    subscribe for or purchase any Junior Stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A &#147;change of control&#148; shall be deemed to have occurred
    at such time as (i)&#160;the date a &#147;person&#148; or
    &#147;group&#148; (within the meaning of Sections&#160;13(d) and
    14(d) of the Exchange Act) becomes the ultimate &#147;beneficial
    owner&#148; (as defined in
    <FONT style="white-space: nowrap">Rules&#160;13d-3</FONT>
    and <FONT style="white-space: nowrap">13d-5</FONT>
    under the Exchange Act, except that a person or group shall be
    deemed to have beneficial ownership of all shares of voting
    stock that such person or group has the right to acquire
    regardless of when such right is first exercisable), directly or
    indirectly, of voting stock representing more than 50% of the
    total voting power of our total voting stock; (ii)&#160;the date
    we sell, transfer or otherwise dispose of all or substantially
    all of our assets; or (iii)&#160;the date of the consummation of
    a merger or stock exchange of our company with another entity
    where our stockholders immediately prior to the merger or stock
    exchange would not beneficially own, immediately after the
    merger or stock exchange, shares representing 50% or more of all
    votes (without consideration of the rights of any class of stock
    to elect directors by a separate group vote) to which all
    stockholders of the corporation issuing cash or securities in
    the merger or stock exchange would be entitled in the election
    of directors, or where members of our board of directors
    immediately prior to the merger or stock exchange would not
    immediately after the merger or stock exchange constitute a
    majority of the board of directors of the corporation issuing
    cash or securities in the merger or stock exchange. &#147;Voting
    stock&#148; shall mean stock of any class or kind having the
    power to vote generally in the election of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Redemption.</I>&#160;&#160;We may not redeem the
    Series&#160;G Preferred Stock prior to May&#160;31, 2012, except
    in certain limited circumstances relating to the ownership
    limitation necessary to preserve our qualification as a REIT or
    at any time the Series&#160;G Preferred Stock is not listed on
    the NYSE or the American Stock Exchange or quoted on NASDAQ (or
    listed or quoted on a successor exchange or quotation service)
    following a &#147;change of control.&#148; On or after
    May&#160;31, 2012, we, at our option, may redeem the
    Series&#160;G Preferred Stock, in whole, at any time, or in
    part, from time to time, for cash at a redemption price of
    $25.00 per share, plus all accrued and unpaid dividends thereon
    to, but not including, the date fixed for redemption, without
    interest. If at any time following a change of control, the
    Series&#160;G Preferred Stock is not listed on the NYSE or the
    American Stock Exchange or quoted on NASDAQ (or listed or quoted
    on a successor exchange or quotation service), we will have the
    option to redeem the Series&#160;G Preferred Stock, in whole but
    not in part, within 90&#160;days after the first date on which
    both the change of control has occurred and the Series&#160;G
    Preferred Stock is not so listed or quoted, for cash at
    $25.00&#160;per share plus accrued and unpaid dividends (whether
    or not declared) to, but not including, the date of redemption.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    On the redemption date, we must pay on each share of
    Series&#160;G Preferred Stock to be redeemed any accrued and
    unpaid dividends, in arrears, for any dividend period ending on
    or prior to the redemption date. In the case of a redemption
    date falling after a dividend payment record date and prior to
    the related payment date, the holders of
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Series&#160;G Preferred Stock at the close of business on such
    record date will be entitled to receive the dividend payable on
    such shares on the corresponding dividend payment date,
    notwithstanding the redemption of such shares prior to such
    dividend payment date. Except as provided for in the two
    preceding sentences, no payment or allowance will be made for
    unpaid dividends, whether or not in arrears, on any
    Series&#160;G Preferred Stock called for redemption.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If full cumulative dividends on the Series&#160;G Preferred
    Stock and any Parity Stock have not been paid or declared and
    set apart for payment, the Series&#160;G Preferred Stock may not
    be redeemed in part and we may not purchase, redeem or otherwise
    acquire Series&#160;G Preferred Stock or any Parity Stock other
    than in exchange for Junior Stock; provided, however, that the
    foregoing shall not prevent the purchase by us of shares held in
    excess of the limits in our charter in order to ensure that we
    continue to meet the requirements for qualification as a REIT.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    On and after the date fixed for redemption, dividends will cease
    to accrue on the shares of Series&#160;G Preferred Stock called
    for redemption (except that, in the case of a redemption date
    after a dividend payment record date and prior to the related
    payment date, holders of Series&#160;G Preferred Stock on the
    dividend payment record date will be entitled on such dividend
    payment date to receive the dividend payable on such shares on
    the corresponding dividend payment date), such shares shall no
    longer be deemed to be outstanding and all rights of the holders
    of such shares as holders of Series&#160;G Preferred Stock shall
    cease except the right to receive the cash payable upon such
    redemption, without interest from the date of such redemption.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Liquidation Preference.</I>&#160;&#160;The holders of
    Series&#160;G Preferred Stock will be entitled to receive in the
    event of any liquidation, dissolution or winding up of UDR,
    whether voluntary or involuntary, $25.00&#160;per share of
    Series&#160;G Preferred Stock, which we refer to in this
    prospectus as the &#147;Series&#160;G Liquidation
    Preference,&#148; plus an amount per share of Series&#160;G
    Preferred Stock equal to all dividends (whether or not earned or
    declared) accrued and unpaid thereon to, but not including, the
    date of final distribution to such holders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Until the holders of Series&#160;G Preferred Stock have been
    paid the Series&#160;G Liquidation Preference and all accrued
    and unpaid dividends in full, no payment will be made to any
    holder of Junior Stock upon the liquidation, dissolution or
    winding up of UDR. If, upon any liquidation, dissolution or
    winding up of UDR, our assets, or proceeds thereof,
    distributable among the holders of the Series&#160;G Preferred
    Stock are insufficient to pay in full the Series&#160;G
    Liquidation Preference and all accrued and unpaid dividends and
    the liquidation preference and all accrued and unpaid dividends
    with respect to any other shares of Parity Stock, then such
    assets, or the proceeds thereof, will be distributed among the
    holders of Series&#160;G Preferred Stock and any such Parity
    Stock ratably in accordance with the respective amounts that
    would be payable on such Series&#160;G Preferred Stock and any
    such Parity Stock if all amounts payable thereon were paid in
    full. None of (i)&#160;a consolidation or merger of UDR with one
    or more entities, (ii)&#160;a statutory stock exchange by UDR or
    (iii)&#160;a sale or transfer of all or substantially all of our
    assets will be considered a liquidation, dissolution or winding
    up, voluntary or involuntary, of UDR.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Voting Rights.</I>&#160;&#160;Except as indicated below, the
    holders of Series&#160;G Preferred Stock will have no voting
    rights. If and whenever six quarterly dividends (whether or not
    consecutive) payable on the Series&#160;G Preferred Stock are in
    arrears, whether or not earned or declared, the number of
    members then constituting our board of directors will be
    increased by two and the holders of Series&#160;G Preferred
    Stock, voting together as a class with the holders of any other
    series of Parity Stock upon which like voting rights have been
    conferred and are exercisable (any such other series, the
    &#147;Voting Preferred Shares&#148;), will have the right to
    elect two additional board members at an annual meeting of
    stockholders or a properly called special meeting of the holders
    of the Series&#160;G Preferred Stock and such Voting Preferred
    Shares and at each subsequent annual meeting of stockholders
    until all such dividends and dividends for the then current
    quarterly period on the Series&#160;G Preferred Stock and such
    other Voting Preferred Shares have been paid or declared and set
    aside for payment. Whenever all arrears in dividends on the
    Series&#160;G Preferred Stock and the Voting Preferred Shares
    then outstanding have been paid and full dividends on the
    Series&#160;G Preferred Stock and the Voting Preferred Shares
    for the then current quarterly dividend period have been paid in
    full or declared and set apart for payment in full, then the
    right of the holders of the Series&#160;G Preferred Stock and
    the Voting Preferred Shares to elect two additional board
    members will cease, the terms of office of the board members
    will forthwith terminate and the number of members of the board
    of directors will be reduced accordingly. However, the right of
    the holders of the Series&#160;G Preferred Stock and the Voting
    Preferred Shares to elect the additional board members will
    again vest if and whenever six quarterly dividends are in
    arrears, as described above. In no event shall the holders of
    Series&#160;G Preferred Stock be entitled pursuant to these
    voting rights to elect a director that would cause us
</DIV>
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    <BR>
    8
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    to fail to satisfy a requirement relating to director
    independence of any national securities exchange on which any
    class or series of our stock is listed.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, the approval of two-thirds of the votes entitled to
    be cast by the holders of outstanding Series&#160;G Preferred
    Stock, voting separately as a class, either at a meeting of
    stockholders or by written consent, is required (i)&#160;to
    amend, alter or repeal any provisions of our charter or the
    Articles&#160;Supplementary relating to the Series&#160;G
    Preferred Stock, whether by merger, consolidation or otherwise,
    to affect materially and adversely the voting powers, rights or
    preferences of the holders of the Series&#160;G Preferred Stock,
    unless in connection with any such amendment, alteration or
    repeal, the Series&#160;G Preferred Stock remains outstanding
    without the terms thereof being materially changed in any
    respect adverse to the holders thereof or is converted into or
    exchanged for preferred stock of the surviving entity having
    preferences, conversion and other rights, voting powers,
    restrictions, limitations as to dividends, qualifications and
    terms and conditions of redemption thereof that are
    substantially similar to those of the Series&#160;G Preferred
    Stock, or (ii)&#160;to authorize, create, or increase the
    authorized amount of any class or series of capital stock having
    rights senior to the Series&#160;G Preferred Stock with respect
    to the payment of dividends or amounts upon liquidation,
    dissolution or winding up (provided that if such amendment
    affects materially and adversely the rights, preferences,
    privileges or voting powers of one or more but not all of the
    other series of Voting Preferred Shares, the consent of the
    holders of at least two-thirds of the outstanding shares of each
    such series so affected is required). However, we may create
    additional classes of Parity Stock and Junior Stock, amend our
    charter to increase the authorized number of shares of Parity
    Stock (including the Series&#160;G Preferred Stock) and Junior
    Stock and issue additional series of Parity Stock and Junior
    Stock without the consent of any holder of Series&#160;G
    Preferred Stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Conversion Rights.</I>&#160;&#160;The Series&#160;G Preferred
    Stock is not convertible into or exchangeable for any other
    property or any other securities except as set forth in
    Article&#160;VI of our charter dealing with restrictions on
    ownership and transfer in connection with the preservation of
    our REIT status.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Listing.</I>&#160;&#160;The Series&#160;G Preferred Stock is
    listed on the NYSE under the symbol &#147;UDRPrG.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Transfer Agent, Registrar, Dividend Disbursing Agent and
    Redemption&#160;Agent.</I>&#160;&#160;The transfer agent,
    registrar, dividend disbursing agent and redemption agent for
    the Series&#160;G Preferred Stock is Wells Fargo Bank, N.A.,
    South St. Paul, Minnesota.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Anti-takeover
    Effects of Our Bylaws and Maryland Law</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Our bylaws and Maryland law contain provisions that could have
    the effect of delaying, deferring or discouraging another party
    from acquiring control of us. These provisions, which are
    summarized below, are expected to discourage coercive takeover
    practices and inadequate takeover bids. These provisions are
    also designed to encourage persons seeking to acquire control of
    us to first negotiate with our board of directors.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Bylaws.</I>&#160;&#160;Our bylaws establish an advance
    written notice procedure for stockholders seeking to nominate
    candidates for election as directors at any annual meeting of
    stockholders and to bring business before an annual meeting of
    our stockholders. Our bylaws provide that only persons who are
    nominated by our board of directors or by a stockholder who has
    given timely written notice to our secretary before the meeting
    to elect directors will be eligible for election as our
    directors. Our bylaws also provide that any matter to be
    presented at any meeting of stockholders must be presented
    either by our board of directors or by a stockholder in
    compliance with the procedures in our bylaws. A stockholder must
    give timely written notice to our secretary of its intention to
    present a matter before an annual meeting of stockholders. Our
    board of directors then will consider whether the matter is one
    that is appropriate for consideration by our stockholders under
    the Maryland General Corporation Law and the SEC&#146;s rules.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Certain Maryland Law Provisions.</I>&#160;&#160;As a Maryland
    corporation, we are subject to certain restrictions concerning
    certain &#147;business combinations&#148; (including a merger,
    consolidation, share exchange or, in certain circumstances, an
    asset transfer or issuance or reclassification of equity
    securities) between us and an &#147;interested
    stockholder.&#148; Interested stockholders are persons:
    (i)&#160;who beneficially own 10% or more of the voting power of
    our outstanding voting stock, or (ii)&#160;who are affiliates or
    associates of us who, at any time within the two-year period
    prior to the date in question, were the beneficial owners of 10%
    or more of the voting power of our outstanding
</DIV>
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    <BR>
    9
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    stock. Such business combinations are prohibited for five years
    after the most recent date on which the interested stockholder
    became an interested stockholder. Thereafter, any such business
    combination must be recommended by the board of directors and
    approved by the affirmative vote of at least: (i)&#160;80% of
    the votes entitled to be cast by holders of the outstanding
    voting shares voting together as a single voting group, and
    (ii)&#160;two-thirds of the votes entitled to be cast by holders
    of the outstanding voting shares other than voting shares held
    by the interested stockholder or an affiliate or associate of
    the interested stockholder with whom the business combination is
    to be effected, unless, among other things, the
    corporation&#146;s stockholders receive a minimum price for
    their shares and the consideration is received in the form of
    cash or other consideration in the same form as previously paid
    by the interested stockholder for its shares. These provisions
    of Maryland law do not apply, however, to business combinations
    that are approved or exempted by the board of directors prior to
    the time that the interested stockholder becomes an interested
    stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Also under Maryland law, &#147;control shares&#148; of a
    Maryland corporation acquired in a &#147;control share
    acquisition&#148; have no voting rights except to the extent
    approved by a vote of two-thirds of the votes entitled to be
    cast on the matter, excluding shares owned by the acquirer or by
    officers or directors who are employees of the corporation.
    &#147;Control shares&#148; are shares of stock which, if
    aggregated with all other shares of stock owned by the acquirer
    or shares of stock for which the acquirer is able to exercise or
    direct the exercise of voting power except solely by virtue of a
    revocable proxy, would entitle the acquirer to exercise voting
    power in electing directors within one of the following ranges
    of voting power:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    one-tenth or more but less than one-third,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    one-third or more but less than a majority,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a majority or more of all voting power.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Control shares do not include shares the acquiring person is
    then entitled to vote as a result of having previously obtained
    stockholder approval. A &#147;control share acquisition&#148;
    means, subject to certain exceptions, the acquisition of,
    ownership of or the power to direct the exercise of voting power
    with respect to, control shares.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The control share acquisition statute does not apply to shares
    acquired in a merger, consolidation or share exchange if the
    corporation is a party to the transaction or to acquisitions
    approved or exempted by the charter or bylaws of the
    corporation. Our bylaws contain a provision exempting from the
    control share acquisition statute any acquisitions by any person
    of shares of our stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under Title&#160;3, Subtitle&#160;8 of the Maryland General
    Corporation Law, a Maryland corporation that has a class of
    equity securities registered under the Securities Exchange Act
    of 1934 and that has at least three directors who are not
    officers or employees of the corporation, are not acquiring
    persons, are not directors, officers, affiliates or associates
    of any acquiring person, or are not nominated or designated as a
    director by an acquiring person, may elect in its charter or
    bylaws or by resolution of its board of directors to be subject
    to certain provisions of Subtitle&#160;8 that may have the
    effect of delaying or preventing a change in control of the
    corporation. These provisions relate to a classified board of
    directors, removal of directors, establishing the number of
    directors, filling vacancies on the board of directors and
    calling special meetings of the corporation&#146;s stockholders.
    We have not made the election to be governed by these provisions
    of Subtitle&#160;8 of the Maryland General Corporation Law.
    However, our charter and our bylaws permit our board of
    directors to determine the number of directors subject to a
    minimum number and other provisions contained in such documents.
</DIV>

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    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF DEBT SECURITIES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may offer debt securities, in one or more series, which may
    be senior debt securities or subordinated debt securities, in
    each case under an indenture entered into between us and a
    trustee. The debt securities will be our direct obligations. We
    will describe the particular terms of each series of debt
    securities offered, including a description of the material
    terms of the applicable indenture, in a prospectus supplement.
    This description will contain all or some of the following, as
    applicable:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the title of the debt securities and whether the debt securities
    are senior debt securities or subordinated debt securities,
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    10
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the aggregate principal amount of the debt securities being
    offered, the aggregate principal amount of debt securities
    outstanding, and any limit on the principal amount, including
    the aggregate principal amount of debt securities authorized,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the terms and conditions, if any, upon which the debt securities
    are convertible into our common stock, preferred stock or other
    securities, including the conversion price or its manner of
    calculation, the conversion period, provisions as to whether
    conversion will be at our option or the option of the holders,
    the events requiring an adjustment to the conversion price and
    provisions affecting conversion in the event of the redemption
    of the debt securities,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the percentage of the principal amount at which we will issue
    the debt securities and, if other than the principal amount of
    the debt securities, the portion of the principal amount payable
    upon declaration of acceleration of their maturity, or, if
    applicable, the portion of the principal amount of the debt
    securities that is convertible into our capital stock, or the
    method for determining the portion,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if convertible, in connection with the preservation of our
    status as a REIT, any applicable limitations on the ownership or
    transferability of our capital stock into which the debt
    securities are convertible,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the denominations of the debt securities, if other than
    denominations of an integral multiple of $1,000,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the date or dates, or the method for determining the date or
    dates, on which the principal of the debt securities will be
    payable and the amount of principal payable on the debt
    securities,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the rate or rates, which may be fixed or variable, at which the
    debt securities will bear interest, if any, or the method for
    determining the rate or rates, the date or dates from which the
    interest will accrue or the method for determining the date or
    dates, the interest payment dates on which any interest will be
    payable and the regular record dates for the interest payment
    dates or the method for determining the dates, the person to
    whom interest should be payable, and the basis for calculating
    interest if other than that of a
    <FONT style="white-space: nowrap">360-day</FONT> year
    consisting of twelve
    <FONT style="white-space: nowrap">30-day</FONT>
    months,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the place or places where the principal of, and any premium or
    make-whole amount, any interest on, and any additional amounts
    payable in respect of, the debt securities will be payable,
    where holders of debt securities may surrender for registration
    of transfer or exchange, and where holders may serve notices or
    demands to or upon us in respect of the debt securities and the
    applicable indenture,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any provisions for the redemption of the debt securities, the
    period or periods within which, the price or prices, including
    any premium or make-whole amount, at which, the currency or
    currencies, currency unit or units or composite currency or
    currencies in which, and other terms and conditions upon which
    the debt securities may be redeemed in whole or in part at our
    option, if we have the option,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our obligation, if any, to redeem, repay or purchase the debt
    securities pursuant to any sinking fund or analogous provision
    or at the option of a holder of the debt securities, and the
    period or periods within which or the date or dates on which,
    the price or prices at which, the currency or currencies,
    currency unit or units or composite currency or currencies in
    which, and other terms and conditions upon which the debt
    securities will be redeemed, repaid or purchased, in whole or in
    part, pursuant to the obligation,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if other than United States dollars, the currency or currencies
    in which the debt securities will be denominated and payable,
    which may be a foreign currency or units of two or more foreign
    currencies or a composite currency or currencies,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the amount of payments of principal of, and any premium
    or make-whole amount, or any interest on the debt securities may
    be determined with reference to an index, formula or other
    method, which index, formula or method may be based on one or
    more currencies, currency units, composite currencies,
    commodities, equity indices or other indices, and the manner for
    determining the amounts,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the principal of, and any premium or make-whole amount,
    or any interest or additional amounts on the debt securities are
    to be payable, at the election of UDR or a holder, in a currency
    or currencies, currency unit or units or composite currency or
    currencies other than that in which the debt securities are
    denominated or stated to be payable, the period or periods
    within which, and the terms and conditions upon which, the
</TD>
</TR>
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</TABLE>
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    <BR>
    11
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    election may be made, and the time and manner of, and identity
    of the exchange rate agent with responsibility for, determining
    the exchange rate between the currency or currencies, currency
    unit or units or composite currency or currencies in which the
    debt securities are denominated or stated to be payable and the
    currency or currencies, currency unit or units or composite
    currency or currencies in which the debt securities are to be so
    payable,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provisions, if any, granting special rights to the holders of
    the debt securities upon the occurrence of specified events,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any deletions from, modifications of or additions to the events
    of default or covenants of UDR with respect to the debt
    securities, whether or not the events of default or covenants
    are consistent with the events of default or covenants set forth
    in the applicable indenture,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the debt securities will be issued in certificated or
    book-entry form,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the applicability, if any, of the defeasance and covenant
    defeasance provisions of the applicable indenture,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether and under what circumstances we will pay additional
    amounts as contemplated in the applicable indenture on the debt
    securities in respect of any tax, assessment or governmental
    charge and, if so, whether we will have the option to redeem the
    debt securities rather than pay the additional amounts, and the
    terms of the option,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any restrictions or condition on the transferability of the debt
    securities,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the exchanges, if any, on which the debt securities may be
    listed,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the trustee, authenticating or paying agent, transfer agent or
    registrar,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other material terms of the debt securities and the
    applicable indenture.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The debt securities may be original issue discount securities,
    which are debt securities that may provide for less than their
    entire principal amount to be payable upon declaration of
    acceleration of their maturity. Special U.S.&#160;federal income
    tax, accounting and other considerations applicable to original
    issue discount securities will be described in the prospectus
    supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless we specify otherwise in the applicable prospectus
    supplement, we will issue our senior debt securities under an
    indenture dated as of November&#160;1, 1995, between us and the
    trustee under the indenture, which is U.S.&#160;Bank National
    Association (successor trustee to Wachovia Bank, National
    Association, formerly known as First Union National Bank of
    Virginia). We refer to this indenture as the &#147;Senior
    Indenture.&#148; Unless we specify otherwise in the applicable
    prospectus supplement, we will issue our subordinated debt
    securities under the indenture dated as of August&#160;1, 1994,
    between us and the trustee under the indenture, which is
    U.S.&#160;Bank National Association (successor trustee to
    SunTrust Bank, formerly known as Crestar Bank). We refer to this
    indenture as the &#147;Subordinated Indenture.&#148; The Senior
    Indenture and the Subordinated Indenture are sometimes referred
    to in this prospectus individually as an &#147;Indenture&#148;
    and collectively as the &#147;Indentures.&#148; As trustees,
    U.S.&#160;Bank serves two roles. First, the trustees can enforce
    your rights against us if we default on the debt securities.
    Second, the trustees assist in administering our obligations
    under the debt securities, such as payments of interest.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Below, we describe the Indentures and summarize some of their
    provisions. However, we have not described every aspect of the
    Indentures or the debt securities that we may issue under the
    Indentures. You should refer to the actual Indentures for a
    complete description of their provisions and the definitions of
    terms used in them. In this prospectus, we provide only the
    definitions for some of the more important terms in the
    Indentures. Wherever we refer to defined terms of the Indentures
    in this prospectus or in the prospectus supplement, we are
    incorporating by reference those defined terms. The Senior
    Indenture and Subordinated Indenture are exhibits to the
    registration statement of which this prospectus is a part.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>General Terms.</I>&#160;&#160;The Indentures do not limit the
    aggregate principal amount of debt securities that we may issue
    and provide that we may issue debt securities from time to time
    in one or more series, except that the Senior Indenture contains
    limitations on the amount of indebtedness that we may incur, as
    described in more detail below.
</DIV>
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    <BR>
    12
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The senior debt securities issued under the Senior Indenture
    will be unsecured obligations and will rank on a parity with all
    of our other unsecured and unsubordinated indebtedness. The
    subordinated debt securities issued under the Subordinated
    Indenture will be our unsecured obligations and will be
    subordinated in right of payment to all senior debt.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each Indenture allows for any one or more series of debt
    securities to have one or more trustees. Any trustee under
    either Indenture may resign or be removed with respect to one or
    more series of debt securities, and a successor trustee may be
    appointed to act with respect to the series. If two or more
    persons are acting as trustee with respect to different series
    of debt securities, each trustee will be a trustee of a trust
    under the applicable Indenture separate and apart from the trust
    administered by any other trustee. Unless this prospectus or the
    applicable prospectus supplement states differently, each
    trustee of a series of debt securities may take any action that
    we may take under the applicable Indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will provide you with more information in the applicable
    prospectus supplement regarding any deletions, modifications or
    additions to the events of default or covenants that are
    described below, including any addition of a covenant or other
    provision.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Denominations, Interest, Registration and
    Transfer.</I>&#160;&#160;Unless the applicable prospectus
    supplement states differently, the debt securities of any series
    issued under an Indenture in registered form will be issuable in
    denominations of $1,000 and integral multiples of $1,000. Unless
    the prospectus supplement states otherwise, the debt securities
    of any series issued under an Indenture in bearer form will be
    issuable in denominations of $5,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise provided in the applicable prospectus
    supplement, the trustees will pay the principal of and any
    premium and interest on the debt securities issued under an
    Indenture and will register the transfer of any debt securities
    at their offices. However, at our option, we may distribute
    interest payments by mailing a check to the address of each
    holder of debt securities that appears on the register for the
    debt securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any interest on the debt securities not punctually paid or duly
    provided for on any interest payment date will cease to be
    payable to the holder on the applicable regular record date.
    This defaulted interest may be paid to the person in whose name
    the debt security is registered at the close of business on a
    special record date for the payment of the defaulted interest.
    We will set the special record date and give the holder of the
    debt security at least 10&#160;days&#146; prior notice. In the
    alternative, this defaulted interest may be paid in any other
    lawful manner, all as more completely described in the
    applicable Indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Subject to any limitations imposed upon debt securities issued
    under an Indenture in book-entry form, the debt securities of
    any series will be exchangeable for other debt securities of the
    same series and of a like aggregate principal amount and tenor
    of different authorized denominations upon surrender to the
    applicable trustee of the debt securities. In addition, subject
    to any limitations imposed upon debt securities issued under an
    Indenture in book-entry form, a holder may surrender the debt
    securities to the trustee for conversion or registration of
    transfer. Debt securities surrendered for conversion,
    registration of transfer or exchange will be duly endorsed or
    accompanied by a written instrument of transfer from the holder.
    A holder will not have to pay a service charge for any
    registration of transfer or exchange of any debt securities, but
    we may require payment of a sum sufficient to cover any
    applicable tax or other governmental charge.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If the prospectus supplement refers to any transfer agent, in
    addition to the applicable trustee that we initially designated
    with respect to any series of debt securities, we may at any
    time rescind the designation of the transfer agent or approve a
    change in the location through which the transfer agent acts,
    except that we will be required to maintain a transfer agent in
    each place of payment for the series. We may at any time
    designate additional transfer agents with respect to any series
    of debt securities issued under an Indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Neither we nor the trustees under the Indentures will be
    required to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    issue, register the transfer of or exchange debt securities of
    any series during a period beginning at the opening of business
    15&#160;days before any selection of debt securities of that
    series to be redeemed and ending at the close of business on the
    day of mailing of the relevant notice of redemption,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    register the transfer of or exchange any debt security, or
    portion thereof, called for redemption, except the unredeemed
    portion of any debt security being redeemed in part,&#160;or
</TD>
</TR>

</TABLE>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    13
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    issue, register the transfer of or exchange any debt security
    that has been surrendered for repayment at the holder&#146;s
    option, except the portion, if any, of the debt security not to
    be repaid.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Merger, Consolidation or Sale.</I>&#160;&#160;The Indentures
    generally provide that we may consolidate with, or sell, lease
    or convey all or substantially all of our assets to, or merge
    with or into, any other entity, provided that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    either we will be the continuing entity, or the successor entity
    formed by or resulting from the consolidation or merger or that
    will have received the transfer of the assets is an entity
    organized and existing under the laws of the United States or
    any state and will expressly assume payment of the principal of,
    and any premium or make-whole amount, if any, and interest on
    all of the debt securities issued under the Indenture and the
    due and punctual performance and observance of all of the
    covenants and conditions contained in the Indenture,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    immediately after giving effect to the transaction and treating
    any resulting indebtedness that becomes our or any
    subsidiary&#146;s obligation as having been incurred by us or
    the subsidiary at the time of the transaction, no event of
    default under the Indenture, and no event which, after notice or
    the lapse of time, or both, would become an event of default,
    will have occurred and be continuing,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we receive an Officers&#146; Certificate and legal opinion as to
    compliance with these conditions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Covenants Under the Senior Indenture.</I>&#160;&#160;The
    Senior Indenture provides that we will not, and will not permit
    any subsidiary to, incur any Debt (as defined below) if,
    immediately after giving effect to the incurrence of the
    additional Debt and the application of the proceeds from the
    Debt, the aggregate principal amount of all of our outstanding
    Debt on a consolidated basis determined in accordance with
    generally accepted accounting principles is greater than 60% of
    the sum of, without duplication:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our Total Assets (as defined below) as of the end of the
    calendar quarter covered in our Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    or Quarterly Report on
    <FONT style="white-space: nowrap">Form&#160;10-Q,</FONT>
    as the case may be, most recently filed with the SEC, or, if the
    filing is not permitted under the Exchange Act, with the
    trustee, prior to the incurrence of the additional Debt,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the purchase price of any real estate assets or mortgages
    receivable acquired, and the amount of any securities offering
    proceeds received, to the extent the proceeds were not used to
    acquire real estate assets or mortgages receivable or used to
    reduce Debt, by us or any subsidiary since the end of the
    calendar quarter, including those proceeds obtained in
    connection with the incurrence of the additional Debt.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition to the foregoing limitations on the incurrence of
    Debt, the Senior Indenture provides that we will not, and will
    not permit any subsidiary to, incur any Debt secured by any
    mortgage, lien, charge, pledge, encumbrance or security interest
    of any kind upon any of our or any subsidiary&#146;s property
    if, immediately after giving effect to the incurrence of the
    Debt and the application of the proceeds from the Debt, the
    aggregate principal amount of all of our outstanding Debt on a
    consolidated basis that is secured by any mortgage, lien,
    charge, pledge, encumbrance or security interest on our or any
    subsidiary&#146;s property is greater than 40% of our Total
    Assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition to the foregoing limitations on the incurrence of
    Debt, the Senior Indenture provides that we will not, and will
    not permit any subsidiary to, incur any Debt if the ratio of
    Consolidated Income Available for Debt Service (as defined
    below) to the Annual Service Charge (as defined below) for the
    four consecutive fiscal quarters most recently ended prior to
    the date on which the additional Debt is to be incurred will
    have been less than 1.5, on a pro forma basis after giving
    effect to the Debt and to the application of the proceeds from
    the Debt, and calculated on the assumption that:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the Debt and any other Debt incurred since the first day of the
    four-quarter period and the application of the proceeds
    therefrom, including to refinance other Debt, had occurred at
    the beginning of the period,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our repayment or retirement of any other Debt since the first
    day of the four-quarter period had been incurred, repaid or
    retired at the beginning of the period, except that, in making
    the computation, the amount of Debt under any revolving credit
    facility will be computed based upon the average daily balance
    of the Debt during the period,
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    14
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the case of Acquired Debt (as defined below) or Debt incurred
    in connection with any acquisition since the first day of the
    four-quarter period, the related acquisition had occurred as of
    the first day of the period with the appropriate adjustments
    with respect to the acquisition being included in the pro forma
    calculation,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the case of our acquisition or disposition of any asset or
    group of assets since the first day of the four-quarter period,
    whether by merger, stock purchase or sale, or asset purchase or
    sale, the acquisition or disposition or any related repayment of
    Debt had occurred as of the first day of the period with the
    appropriate adjustments with respect to the acquisition or
    disposition being included in the pro forma calculation.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Subordinated Indenture does not limit the incurrence of Debt.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following terms used in the covenants summarized above have
    the indicated meanings:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Acquired Debt&#148;</I> means Debt of a person
    (i)&#160;existing at the time the person becomes a subsidiary or
    (ii)&#160;assumed in connection with the acquisition of assets
    from the person, in each case, other than Debt incurred in
    connection with, or in contemplation of, the person becoming a
    subsidiary or the acquisition. Acquired Debt will be deemed to
    be incurred on the date of the related acquisition of assets
    from any person or the date the acquired person becomes a
    subsidiary.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Annual Service Charge&#148; </I>as of any date means
    the maximum amount that is payable in any period for interest
    on, and original issue discount of, our Debt and the amount of
    dividends that are payable in respect of any Disqualified Stock
    (as defined below).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Capital Stock&#148;</I> means, with respect to any
    person, any capital stock, including preferred stock, shares,
    interests, participations or other ownership interests, however
    designated, of the person and any rights (other than debt
    securities convertible into or exchangeable for corporate
    stock), warrants or options to purchase any capital stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Consolidated Income Available for Debt Service&#148;
    </I>for any period means Funds From Operations (as defined
    below) plus amounts that have been deducted for interest on Debt.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Debt&#148;</I> of UDR or any subsidiary means any
    indebtedness of UDR, or any subsidiary, whether or not
    contingent, in respect of, without duplication:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    borrowed money or evidenced by bonds, notes, debentures or
    similar instruments,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    indebtedness secured by any mortgage, pledge, lien, charge,
    encumbrance or any security interest existing on property owned
    by UDR or any subsidiary,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the reimbursement obligations, contingent or otherwise, in
    connection with any letters of credit actually issued or amounts
    representing the balance deferred and unpaid of the purchase
    price of any property or services, except any balance that
    constitutes an accrued expense or trade payable, or all
    conditional sale obligations or obligations under any title
    retention agreement,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the principal amount of all obligations of UDR or any subsidiary
    with respect to redemption, repayment or other repurchase of any
    Disqualified Stock,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any lease of property by UDR or any subsidiary as lessee that is
    reflected on UDR&#146;s consolidated balance sheet as a
    capitalized lease in accordance with generally accepted
    accounting principles to the extent, in the case of items of
    indebtedness under the first three bullet points above, that any
    of the items, other than letters of credit, would appear as a
    liability on UDR&#146;s consolidated balance sheet in accordance
    with generally accepted accounting principles, and also
    includes, to the extent not otherwise included, any obligation
    of UDR or any subsidiary to be liable for, or to pay, as
    obligor, guarantor or otherwise, other than for purposes of
    collection in the ordinary course of business, debt of another
    person, other than UDR or any subsidiary.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Debt will be deemed to be incurred by us or any subsidiary
    whenever we or a subsidiary creates, assumes, guarantees or
    otherwise becomes liable for that Debt.
</DIV>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    15
</DIV><!-- END PAGE WIDTH -->
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<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Disqualified Stock&#148;</I> means, with respect to any
    person, any capital stock of the person that by the terms of the
    capital stock, or by the terms of any security into which it is
    convertible or for which it is exchangeable or exercisable, upon
    the happening of any event or otherwise:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    matures or is mandatorily redeemable, pursuant to a sinking fund
    obligation or otherwise,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    is convertible into or exchangeable or exercisable for Debt or
    Disqualified Stock,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    is redeemable at the option of the holder thereof, in whole or
    in part, in each case on or prior to the Stated Maturity of the
    series of debt securities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Funds From Operations&#148;</I> for any period means
    income before gains or losses on investments and extraordinary
    items plus amounts that have been deducted, and minus amounts
    that have been added, for the following items, without
    duplication:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provision for preferred stock dividends,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    provision for property depreciation and amortization,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the effect of any adjustments for significant non-recurring
    items, including any noncash charge resulting from a change in
    accounting principles in determining income before gains or
    losses on investments and extraordinary items for the period, as
    reflected in our financial statements for the period determined
    on a consolidated basis in accordance with generally accepted
    accounting principles.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Total Assets&#148;</I> as of any date means the sum of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our Undepreciated Real Estate Assets,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all of our other assets determined in accordance with generally
    accepted accounting principles, but excluding intangibles.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Undepreciated Real Estate Assets&#148; </I>as of any
    date means the original cost plus capital improvements of our
    real estate assets on the date, before depreciation and
    amortization determined on a consolidated basis in accordance
    with generally accepted accounting principles.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Except as described above, the Indentures do not contain any
    provisions that would limit our ability to incur indebtedness or
    that would afford holders of the debt securities protection in
    the event of a highly leveraged or similar transaction involving
    us or in the event of a change of control. However, our charter,
    contains ownership and transfer restrictions relating to our
    stock that are designed primarily to preserve our status as a
    REIT for U.S.&#160;federal income tax purposes. The Code
    generally provides that concentration of more than 50% in value
    of direct or indirect ownership of our stock in five or fewer
    individual stockholders during the last six months of any year,
    or ownership of our stock by fewer than 100&#160;persons on more
    than a limited number of days during any taxable year, will
    result in our disqualification as a REIT for such purposes.
    Provisions of our charter that are intended to prevent
    concentration of ownership may prevent or hinder a change of
    control. You should refer to the applicable prospectus
    supplement for information with respect to any deletions from,
    modifications of or additions to the events of default or
    covenants of UDR that are described in this section, including
    any addition of a covenant or other provision providing event
    risk or similar protection.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Covenants Under Both Indentures.</I>&#160;&#160;Each
    Indenture includes the following covenants:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Existence.</I>&#160;&#160;Except as described above under
    &#147;Merger, Consolidation or Sale,&#148; we will do or cause
    to be done all things necessary to preserve and keep in full
    force and effect our existence, rights, both under our charter
    and statutory, and franchises. However, we will not be required
    to preserve any right or franchise if our board of directors
    determines that its preservation is no longer desirable in the
    conduct of our business and the business of our subsidiaries as
    a whole and that the loss thereof is not disadvantageous in any
    material respect to the holders of the debt securities of any
    series.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Maintenance of Properties.</I>&#160;&#160;We will cause all
    of our properties used or useful in the conduct of our business
    or the business of any subsidiary to be maintained and kept in
    good condition, repair and working order and supplied with all
    necessary equipment and will cause to be made all necessary
    repairs, renewals,
</DIV>
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    <BR>
    16
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    replacements, betterments and improvements thereof, all as in
    our judgment may be necessary so that our business may be
    properly and advantageously conducted at all times. However, we
    will not be prevented from selling or otherwise disposing of for
    value our properties in the ordinary course of business.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Insurance.</I>&#160;&#160;We will, and will cause each of our
    subsidiaries to, keep all of our insurable properties insured
    against loss or damage in an amount at least equal to their then
    full insurable value with financially sound and reputable
    insurance companies.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Payment of Taxes and Other Claims.</I>&#160;&#160;We will pay
    or discharge or cause to be paid or discharged, before the same
    becomes delinquent:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="8%"></TD>
    <TD width="2%"></TD>
    <TD width="90%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all taxes, assessments and governmental charges levied or
    imposed upon us or any subsidiary or upon our or any
    subsidiary&#146;s income, profits or property,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all lawful claims for labor, materials and supplies that, if
    unpaid, might by law become a lien upon our or any
    subsidiary&#146;s property.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    However, we will not be required to pay or discharge or cause to
    be paid or discharged any such tax, assessment, charge or claim
    whose amount, applicability or validity is being contested in
    good faith by appropriate proceedings.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Provision of Financial Information.</I>&#160;&#160;Whether or
    not we are subject to Sections&#160;13 or 15(d) of the Exchange
    Act, we will, to the extent permitted under the Exchange Act,
    file with the SEC the annual reports, quarterly reports and
    other documents that we would have been required to file with
    the SEC pursuant to Sections&#160;13 and 15(d) if we were
    subject to those Sections. We will also in any event:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    within 15&#160;days of each required filing date
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    transmit by mail to all holders of debt securities, as their
    names and addresses appear in the security register, without
    cost to the holders, copies of the annual reports and quarterly
    reports that we would have been required to file with the SEC
    pursuant to Sections&#160;13 or 15(d) of the Exchange Act if we
    were subject to those Sections,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    file with the trustee copies of the annual reports, quarterly
    reports and other documents that we would have been required to
    file with the SEC pursuant to Sections&#160;13 or 15(d) of the
    Exchange Act if we were subject to those Sections,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if our filing the documents with the SEC is not permitted under
    the Exchange Act, promptly upon written request and payment of
    the reasonable cost of duplication and delivery, supply copies
    of the documents to any prospective holder.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Events of Default, Notice and Waiver.</I>&#160;&#160;Each
    Indenture provides that the following events are &#147;events of
    default&#148; with respect to any issued series of debt
    securities:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default for 30&#160;days in the payment of any installment of
    interest or additional amounts payable on any debt security of
    the series,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default in the payment of the principal of, or any premium or
    make-whole amount on any debt security of the series at its
    maturity,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default in making any sinking fund payment as required for any
    debt security of the series,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default in the performance of any other covenant of UDR
    contained in the Indenture, other than a covenant added to the
    Indenture solely for the benefit of a series of debt securities
    issued under the Indenture other than the series, continued for
    60&#160;days after written notice as provided in the Indenture,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    default under any bond, debenture, note, mortgage, indenture or
    instrument under which there may be issued or by which there may
    be secured or evidenced any indebtedness for money borrowed by
    us, or by any subsidiary, the repayment of which we have
    guaranteed or for which we are directly responsible or liable as
    obligor or guarantor, having an aggregate principal amount
    outstanding of at least $10,000,000, whether the indebtedness
    now exists or will later be created, which default will have
    resulted in the indebtedness being
</TD>
</TR>
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    <BR>
    17
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>
</TD>
    <TD align="left">
    declared due and payable prior to the date on which it would
    otherwise have become due and payable, without the acceleration
    having been rescinded or annulled within 10&#160;days after
    written notice as provided in the Indenture,
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the entry by a court of competent jurisdiction of one or more
    judgments, orders or decrees against us or any subsidiary in an
    aggregate amount, excluding amounts covered by insurance, in
    excess of $10,000,000 and those judgments, orders or decrees
    remain undischarged, unstayed and unsatisfied in an aggregate
    amount, excluding amounts covered by insurance, in excess of
    $10,000,000 for a period of 30 consecutive days,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    certain events of bankruptcy, insolvency or reorganization, or
    court appointment of a receiver, liquidator or trustee of UDR or
    any significant subsidiary or for all or substantially all of
    either of their properties,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other event of default provided with respect to the series
    of debt securities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The term &#147;significant subsidiary&#148; means each
    significant subsidiary, as defined in
    <FONT style="white-space: nowrap">Regulation&#160;S-X</FONT>
    promulgated under the Securities Act, of UDR.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If an event of default under either Indenture with respect to
    debt securities of any series at the time outstanding occurs and
    is continuing, then in every case the trustee or the holders of
    not less than 25% in principal amount of the outstanding debt
    securities of that series may declare the principal amount, or,
    if the debt securities of that series are original issue
    discount securities or indexed securities, the portion of the
    principal amount as may be specified in their terms, of, and any
    make-whole amount on, all of the debt securities of that series
    to be due and payable immediately by written notice to us, and
    to the trustee if given by the holders. However, at any time
    after the declaration of acceleration with respect to debt
    securities of the series, or of all debt securities then
    outstanding under the applicable Indenture, as the case may be,
    has been made, but before a judgment or decree for payment of
    the money due has been obtained by the trustee, the holders of
    not less than a majority in principal amount of the outstanding
    debt securities of the series, or of all debt securities then
    outstanding under the applicable Indenture, as the case may be,
    may rescind and annul the declaration and its consequences if:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    we will have deposited with the trustee all required payments of
    the principal of and any premium or make-whole amount and
    interest, and any additional amounts, on the debt securities of
    the series, or of all debt securities then outstanding under the
    applicable Indenture, as the case may be, plus certain fees,
    expenses, disbursements and advances of the trustee,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    all events of default, other than the nonpayment of accelerated
    principal, or specified portion thereof and any premium or
    make-whole amount, or interest, with respect to the debt
    securities of the series, or of all debt securities then
    outstanding under the applicable Indenture, as the case may be,
    have been cured or waived as provided in the Indenture.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each Indenture also provides that the holders of not less than a
    majority in principal amount of the outstanding debt securities
    of any series, or of all debt securities then outstanding under
    the applicable Indenture, as the case may be, may waive any past
    default with respect to the series and its consequences, except
    a default:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in the payment of the principal of, or any premium or make-whole
    amount, or interest or additional amounts payable on any debt
    security of the series,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    in respect of a covenant or provision contained in the
    applicable Indenture that cannot be modified or amended without
    the consent of the holder of each affected outstanding debt
    security.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each trustee is required to give notice to the holders of debt
    securities within 90&#160;days of a default under the applicable
    Indenture. However, the trustee may withhold notice to the
    holders of any series of debt securities of any default with
    respect to that series, except a default in the payment of the
    principal of, or any premium or make-whole amount, or interest
    or additional amounts payable, on any debt security of the
    series or in the payment of any sinking fund installment in
    respect of any debt security of the series, if the trustee
    considers the withholding to be in the interest of the holders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each Indenture provides that no holders of debt securities of
    any series may institute any proceedings, judicial or otherwise,
    with respect to the Indenture or for any remedy thereunder,
    except in the case of failure of the trustee for 60&#160;days to
    act after it has received a written request to institute
    proceedings in respect of an event of default from
</DIV>
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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    the holders of not less than 25% in principal amount of the
    outstanding debt securities of the series, as well as an offer
    of reasonable indemnity. This provision will not prevent,
    however, any holder of debt securities from instituting suit for
    the enforcement of payment of the principal of, and any premium
    or make-whole amount, interest on and additional amounts payable
    with respect to, the debt securities at their respective due
    dates.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Modification of the Indentures.</I>&#160;&#160;We and the
    applicable trustee may modify and amend either Indenture with
    the consent of the holders of not less than a majority in
    principal amount of all outstanding debt securities issued under
    the Indenture affected by the modification or amendment.
    However, we must have the consent of the holders of all affected
    outstanding debt securities to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    change the stated maturity of the principal of, or any premium
    or make-whole amount, or any installment of principal of or
    interest or additional amounts payable on, any debt security,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reduce the principal amount of, or the rate or amount of
    interest on, or any premium or make-whole amount payable on
    redemption of, or any additional amounts payable with respect
    to, any debt security, or reduce the amount of principal of an
    original issue discount security or make-whole amount, if any,
    that would be due and payable upon declaration of acceleration
    of its maturity or would be provable in bankruptcy, or adversely
    affect any right of repayment of the holder of any debt security,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    change the place of payment, or the coin or currency, for
    payment of principal of, and any premium or make-whole amount,
    or interest on, or any additional amounts payable with respect
    to, a debt security,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    impair the right to institute suit for the enforcement of any
    payment on or with respect to any debt security,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    reduce the percentage of outstanding debt securities of any
    series necessary to modify or amend the applicable Indenture, to
    waive compliance with any provisions of that Indenture or any
    defaults and consequences thereunder or to reduce the quorum or
    voting requirements set forth in the Indenture,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    modify any of the foregoing provisions or any of the provisions
    relating to the waiver of certain past defaults or certain
    covenants, except to increase the required percentage to effect
    the action or to provide that certain other provisions may not
    be modified or waived without the consent of the holder of the
    debt security.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The holders of not less than a majority in principal amount of
    outstanding debt securities issued under either Indenture have
    the right to waive our compliance with some covenants in the
    Indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Subordination.</I>&#160;&#160;Upon any distribution to our
    creditors in a liquidation, dissolution, reorganization or
    similar proceeding, the payment of the principal of and interest
    on subordinated debt securities issued under the Subordinated
    Indenture will be subordinated to the extent provided in the
    Subordinated Indenture in right of payment to the prior payment
    in full of all senior debt. Our obligation to make payment of
    the principal and interest on the subordinated debt securities
    will not otherwise be affected.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    No payment of principal or interest may be made on the
    subordinated debt securities at any time if a default on senior
    debt exists that permits the holders of the senior debt to
    accelerate its maturity and the default is the subject of
    judicial proceedings or we receive notice of the default. After
    all senior debt is paid in full and until the subordinated debt
    securities are paid in full, holders will be subrogated to the
    rights of holders of senior debt to the extent that
    distributions otherwise payable to holders have been applied to
    the payment of senior debt. By reason of this subordination, in
    the event of a distribution of assets upon insolvency, certain
    of our general creditors may recover more, ratably, than holders
    of the subordinated debt securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Senior debt is defined in the Subordinated Indenture as the
    principal of and interest on, or substantially similar payments
    to be made by UDR in respect of, the following, whether
    outstanding at the date of execution of the Subordinated
    Indenture or thereafter incurred, created or assumed:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our indebtedness for money borrowed or represented by
    purchase-money obligations,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our indebtedness evidenced by notes, debentures, or bonds, or
    other securities issued under the provisions of an indenture,
    fiscal agency agreement or other instrument,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    our obligations as lessee under leases of property either made
    as part of any sale and lease-back transaction to which we are a
    party or otherwise,
</TD>
</TR>

</TABLE>
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    <BR>
    19
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    indebtedness of partnerships and joint ventures that is included
    in our consolidated financial statements,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    indebtedness, obligations and liabilities of others in respect
    of which we are liable contingently or otherwise to pay or
    advance money or property or as guarantor, endorser or otherwise
    or which we have agreed to purchase or otherwise
    acquire,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any binding commitment of us to fund any real estate investment
    or to fund any investment in any entity making a real estate
    investment, in each case other than the following:
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="6%"></TD>
    <TD width="2%"></TD>
    <TD width="92%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any indebtedness, obligation or liability referred to in the
    above bullet points as to which, in the instrument creating or
    evidencing the same pursuant to which the same is outstanding,
    it is provided that the indebtedness, obligation or liability is
    not superior in right of payment to the subordinated debt
    securities or ranks pari passu with the subordinated debt
    securities,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any indebtedness, obligation or liability that is subordinated
    to indebtedness of UDR to substantially the same extent as or to
    a greater extent than the subordinated debt securities are
    subordinated,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the subordinated debt securities.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    At September&#160;30, 2008, our senior unsecured debt totaled
    approximately $2,035,454,000.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Discharge, Defeasance and Covenant
    Defeasance.</I>&#160;&#160;Under each Indenture, we may
    discharge certain obligations to holders of any series of debt
    securities issued under the Indenture that have not already been
    delivered to the applicable trustee for cancellation and that
    either have become due and payable or will become due and
    payable within one year, or scheduled for redemption within one
    year, by irrevocably depositing with the applicable trustee, in
    trust, funds in the currency or currencies, currency unit or
    units or composite currency or currencies in which the debt
    securities are payable in an amount sufficient to pay the entire
    indebtedness on the debt securities in respect of principal, and
    any premium or make-whole amount, and interest and any
    additional amounts payable to the date of the deposit, if the
    debt securities have become due and payable, or to the stated
    maturity or redemption date, as the case may be.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each Indenture provides that, if the provisions of its
    Article&#160;Fourteen are made applicable to the debt securities
    of or within any series pursuant the Indenture, we may elect:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>&#147;defeasance,&#148; </I>which is to defease and be
    discharged from any and all obligations with respect to the debt
    securities, except for the obligation to pay additional amounts,
    if any, upon the occurrence of certain events of tax, assessment
    or governmental charge with respect to payments on the debt
    securities and the obligations to register the transfer or
    exchange of the debt securities, to replace temporary or
    mutilated, destroyed, lost or stolen debt securities, to
    maintain an office or agency in respect of the debt securities
    and to hold moneys for payment in trust,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    <I>&#147;covenant defeasance,&#148; </I>which is to be released
    from our obligations with respect to the debt securities under
    provisions of each Indenture described under &#147;Covenants
    Under the Senior Indenture&#148; and &#147;Covenants Under Both
    Indentures&#148; above, or, if provided pursuant to
    Section&#160;301 of each Indenture, our obligations with respect
    to any other covenant, and any omission to comply with the
    obligations will not constitute a default or an event or default
    with respect to the debt securities issued under the Indenture.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In either case upon our irrevocable deposit with the applicable
    trustee, in trust, of an amount, in the currency or currencies,
    currency unit or currency units or composite currency or
    currencies in which the debt securities are payable at stated
    maturity, or Government Obligations (as defined below), or both,
    applicable to the debt securities that through the scheduled
    payment of principal and interest in accordance with their terms
    will provide money in an amount sufficient to pay the principal
    of, and any premium or make-whole amount, and interest on the
    debt securities, and any mandatory sinking fund or analogous
    payments thereon, on the scheduled due dates therefor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Such a trust may only be established if, among other things, we
    have delivered to the applicable trustee an opinion of counsel,
    as specified in each Indenture, to the effect that the holders
    of the debt securities will not recognize income, gain or loss
    for U.S.&#160;federal income tax purposes as a result of the
    defeasance or covenant defeasance and will be subject to
    U.S.&#160;federal income tax on the same amounts, in the same
    manner and at the same times as would have been the case if the
    defeasance or covenant defeasance had not occurred. In the case
    of
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    defeasance, the opinion of counsel must refer to and be based
    upon a ruling of the Internal Revenue Service or a change in
    applicable U.S.&#160;federal income tax laws occurring after the
    date of the Indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Government Obligations&#148;</I> means securities that
    are:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    direct obligations of the United States of America or the
    government that issued the foreign currency in which the debt
    securities of a particular series are payable, for the payment
    of which its full faith and credit is pledged,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    obligations of a person controlled or supervised by and acting
    as an agency or instrumentality of the United&#160;States of
    America or the government that issued the foreign currency in
    which the debt securities of the series are payable, the payment
    of which is unconditionally guaranteed as a full faith and
    credit obligation by the United States of America or any other
    government, which, in either case, are not callable or
    redeemable at the option of the issuer, and will also include a
    depository receipt issued by a bank or trust company as
    custodian with respect to any Government Obligation or a
    specific payment of interest on or principal of any Government
    Obligation held by the custodian for the account of the holder
    of a depository receipt, provided that, except as required by
    law, the custodian is not authorized to make any deduction from
    the amount payable to the holder of the depository receipt from
    any amount received by the custodian in respect of the
    Government Obligation or the specific payment of interest on or
    principal of the Government Obligation evidenced by the
    depository receipt.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise provided in the prospectus supplement, if after
    we have deposited funds
    <FONT style="white-space: nowrap">and/or</FONT>
    Government Obligations to effect defeasance or covenant
    defeasance with respect to debt securities of any series issued
    under an Indenture:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the holder of a debt security of the series is entitled to, and
    does, elect pursuant to Section&#160;301 of the Indenture or the
    terms of the debt security to receive payment in a currency,
    currency unit or composite currency other than that in which the
    deposit has been made in respect of the debt security,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a Conversion Event (as defined below) occurs in respect of the
    currency, currency unit or composite currency in which the
    deposit has been made, the indebtedness represented by the debt
    security will be deemed to have been, and will be, fully
    discharged and satisfied through the payment of the principal
    of, and any premium or make-whole amount, and interest on the
    debt security as they become due out of the proceeds yielded by
    converting the amount deposited in respect of the debt security
    into the currency, currency unit or composite currency in which
    the debt security becomes payable as a result of the election or
    cessation of usage based on the applicable market exchange rate.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>&#147;Conversion Event&#148;</I> means the cessation of use
    of:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a currency, currency unit or composite currency, other than the
    ECU or other currency unit, both by the government of the
    country that issued the currency and for the settlement of
    transactions by a central bank or other public institutions of
    or within the international banking community,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the ECU both within the European Monetary System and for the
    settlement of transactions by public institutions of or within
    the European Communities,&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any currency unit or composite currency other than the ECU for
    the purposes for which it was established.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise provided in the prospectus supplement, all
    payments of principal of, and any premium or make-whole amount,
    and interest on any debt security issued under an Indenture that
    is payable in a foreign currency that ceases to be used by its
    government of issuance will be made in United States dollars.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we effect covenant defeasance with respect to any debt
    securities and those debt securities are declared due and
    payable because of the occurrence of any event of default, the
    amount in the currency, currency unit or composite currency in
    which the debt securities are payable, and Government
    Obligations on deposit with the trustee, will be sufficient to
    pay amounts due on the debt securities at the time of their
    stated maturity but may not be sufficient to pay amounts due on
    the debt securities at the time of the acceleration resulting
    from the event of default. This situation will not apply in the
    case of an event of default described in the fourth bullet point
    under &#147;Events of Default, Notice and Waiver&#148; of either
    Indenture, which sections would no longer be applicable to the
    debt securities
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    or described in the last bullet point under &#147;Events of
    Default, Notice and Waiver&#148; with respect to a covenant as
    to which there has been covenant defeasance. However, we would
    remain liable to make payment of the amounts due at the time of
    acceleration.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement may further describe the provisions,
    if any, permitting defeasance or covenant defeasance, including
    any modifications to the provisions described above, with
    respect to the debt securities of or within a particular series.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Book-Entry System.</I>&#160;&#160;We may issue debt
    securities of a series as one or more fully registered global
    securities. We will deposit the global securities with, or on
    behalf of, a depository bank identified in the prospectus
    supplement relating to the series. We will register the global
    securities in the name of the depository bank or its nominee. In
    that case, one or more global securities will be issued in a
    denomination or aggregate denominations equal to the aggregate
    principal amount of outstanding debt securities of the series
    represented by the global security or securities. Until any
    global security is exchanged in whole or in part for debt
    securities in definitive certificated form, the depository bank
    or its nominee may not transfer the global certificate except to
    each other, another nominee or to their successors and except as
    described in the applicable prospectus supplement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement will describe the specific terms of
    the depository arrangement with respect to a series of debt
    securities that a global security will represent. We anticipate
    that the following provisions will apply to all depository
    arrangements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Upon the issuance of any global security, and the deposit of the
    global security with or on behalf of the depository bank for the
    global security, the depository bank will credit, on its
    book-entry registration and transfer system, the respective
    principal amounts of the debt securities represented by the
    global security to the accounts of institutions, also referred
    to as &#147;participants,&#148; that have accounts with the
    depository bank or its nominee. The accounts to be credited will
    be designated by the underwriters or agents engaging in the
    distribution or placement of the debt securities or by us, if we
    offer and sell the debt securities directly. Ownership of
    beneficial interests in the global security will be limited to
    participants or persons that may hold interests through
    participants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Ownership of beneficial interests by participants in the global
    security will be shown by book-keeping entries on, and the
    transfer of that ownership interest will be effected only
    through book-keeping entries to, records maintained by the
    depository bank or its nominee for the global security.
    Ownership of beneficial interests in the global security by
    persons that hold through participants will be shown by
    book-keeping entries on, and the transfer of that ownership
    interest among or through the participants will be effected only
    through book-keeping entries to, records maintained by the
    participants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The laws of some jurisdictions require that some of the
    purchasers of securities take physical delivery of the
    securities in definitive certificated form rather than
    book-entry form. Such laws may impair the ability to own,
    transfer or pledge beneficial interests in any global security.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    So long as the depository bank for a global security or its
    nominee is the registered owner of the global security, the
    depository bank or the nominee, as the case may be, will be
    considered the sole owner or holder of the debt securities
    represented by the global security for all purposes under the
    Indenture. Except as described below or otherwise specified in
    the applicable prospectus supplement, owners of beneficial
    interests in a global security:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    will not be entitled to have debt securities of the series
    represented by the global security registered in their names,
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    will not receive or be entitled to receive physical delivery of
    debt securities of the series in definitive certificated
    form,&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    will not be considered the holders thereof for any purposes
    under the applicable indenture.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Accordingly, each person owning a beneficial interest in the
    global security must rely on the procedures of the depository
    bank and, if the person is not a participant, on the procedures
    of the participant through which the person directly or
    indirectly owns its interest, to exercise any rights of a holder
    under the applicable indenture. The depository bank may grant
    proxies and otherwise authorize participants to give or take any
    request, demand,
</DIV>
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    <BR>
    22
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    authorization, direction, notice, consent, waiver or other
    action that a holder is entitled to give or take under the
    indenture.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We understand that under existing industry practices, if we
    request any action of holders or any owner of a beneficial
    interest in the global security desires to give any notice or
    take any action that a holder is entitled to give or take under
    the indenture, the depository bank for the global security would
    authorize the participants holding the relevant beneficial
    interest to give notice or take action, and the participants
    would authorize beneficial owners owning through the
    participants to give notice or take action or would otherwise
    act upon the instructions of beneficial owners owning through
    them.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Principal and any premium and interest payments on debt
    securities represented by a global security registered in the
    name of a depository bank or its nominee will be made to the
    depository bank or its nominee, as the case may be, as the
    registered owner of the global security. None of us, the trustee
    or any paying agent for the debt securities will have any
    responsibility or liability for any aspect of the records
    relating to or payments made on account of beneficial ownership
    interests in any global security or for maintaining, supervising
    or reviewing any records relating to the beneficial ownership
    interests.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We expect that the depository bank for any series of debt
    securities represented by a global security, upon receipt of any
    payment of principal, premium or interest, will credit
    immediately participants&#146; accounts with payments in amounts
    proportionate to their respective beneficial interests in the
    principal amount of the global security as shown on the records
    of the depository bank. We also expect that payments by
    participants to owners of beneficial interests in the global
    security or securities held through the participants will be
    governed by standing instructions and customary practices, as is
    now the case with securities held for the accounts of customers
    registered in &#147;street name,&#148; and will be the
    responsibility of the participants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If the depository bank for any series of debt securities
    represented by a global security is at any time unwilling or
    unable to continue as depository bank and we do not appoint a
    successor depository bank within 90&#160;days, we will issue the
    debt securities in definitive certificated form in exchange for
    the global security. In addition, we may at any time and in our
    sole discretion determine not to have the debt securities of a
    series represented by one or more global securities and, in that
    event, will issue debt securities of the series in definitive
    certificated form in exchange for the global security
    representing the series of debt securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Debt securities of the series issued in definitive certificated
    form will, except as described in the applicable prospectus
    supplement, be issued in denominations of $1,000 and integral
    multiples thereof and will be issued in registered form.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Trustees.</I>&#160;&#160;U.S.&#160;Bank National Association
    (successor trustee to Wachovia Bank, National Association,
    formerly known as First Union National Bank of Virginia) is the
    trustee under the Senior Indenture and is the trustee (as
    successor trustee to SunTrust Bank, formerly known as Crestar
    Bank) under the Subordinated Indenture. Both U.S.&#160;Bank and
    SunTrust Bank have lending relationships with us.
</DIV>

<A name='J82419121'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF GUARANTEES OF THE DEBT SECURITIES</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If specified in the applicable prospectus supplement, certain of
    our subsidiaries will guarantee the debt securities. The
    particular terms of any guarantee will be described in the
    related prospectus supplement.
</DIV>

<A name='J82419122'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF WARRANTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may issue warrants for the purchase of common stock,
    preferred stock or debt securities. We may issue warrants
    independently or together with any offered securities. The
    warrants may be attached to or separate from those offered
    securities. We will issue the warrants under one or more warrant
    agreements to be entered into between us and a warrant agent to
    be named in the applicable prospectus supplement. The warrant
    agent will act solely as our agent in connection with the
    warrants and will not assume any obligation or relationship of
    agency or trust for or with any holders or beneficial owners of
    warrants.
</DIV>
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    <BR>
    23
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement relating to any warrants that we may
    offer will contain the specific terms of the warrants. These
    terms may include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the title of the warrants;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price or prices at which the warrants will be issued;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the designation, amount and terms of the securities for which
    the warrants are exercisable;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the designation and terms of the other securities, if any, with
    which the warrants are to be issued and the number of warrants
    issued with each other security;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the aggregate number of warrants;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any provisions for adjustment of the number or amount of
    securities receivable upon exercise of the warrants or the
    exercise price of the warrants;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price or prices at which the securities purchasable upon
    exercise of the warrants may be purchased;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if applicable, the date on and after which the warrants and the
    securities purchasable upon exercise of the warrants will be
    separately transferable;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a discussion of any material U.S.&#160;federal income tax
    considerations applicable to the exercise of the warrants;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the date on which the right to exercise the warrants will
    commence, and the date on which the right will expire;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the maximum or minimum number of warrants that may be exercised
    at any time;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    information with respect to book-entry procedures, if
    any;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other terms of the warrants, including terms, procedures and
    limitations relating to the exchange and exercise of the
    warrants.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Exercise
    of Warrants</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Each warrant will entitle the holder of the warrant to purchase
    for cash the amount of common stock, preferred stock or debt
    securities at the exercise price stated or determinable in the
    applicable prospectus supplement for the warrants. Warrants may
    be exercised at any time up to the close of business on the
    expiration date shown in the applicable prospectus supplement,
    unless otherwise specified in such prospectus supplement. After
    the close of business on the expiration date, unexercised
    warrants will become void. Warrants may be exercised as
    described in the applicable prospectus supplement. When the
    warrant holder makes the payment and properly completes and
    signs the warrant certificate at the corporate trust office of
    the warrant agent or any other office indicated in the
    prospectus supplement, we will, as soon as possible, forward the
    common stock, preferred stock or debt securities that the
    warrant holder has purchased. If the warrant holder exercises
    the warrant for less than all of the warrants represented by the
    warrant certificate, we will issue a new warrant certificate for
    the remaining warrants.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The description in the applicable prospectus supplement of any
    warrants we offer will not necessarily be complete and will be
    qualified in its entirety by reference to the applicable warrant
    agreement and warrant certificate, which will be filed with the
    SEC if we offer warrants. For more information on how you can
    obtain copies of any warrant certificate or warrant agreement if
    we offer warrants, see &#147;Where You Can Find More
    Information&#148; beginning on page&#160;47 of this prospectus.
    We urge you to read the applicable warrant certificate, the
    applicable warrant agreement and any applicable prospectus
    supplement in their entirety.
</DIV>

<A name='J82419123'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF SUBSCRIPTION RIGHTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may issue subscription rights to purchase common stock,
    preferred stock, debt securities or other securities. We may
    issue subscription rights independently or together with any
    other offered security, which may or may not be transferable by
    the stockholder. In connection with any offering of subscription
    rights, we may
</DIV>
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    <BR>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    enter into a standby arrangement with one or more underwriters
    or other purchasers pursuant to which the underwriters or other
    purchasers may be required to purchase any securities remaining
    unsubscribed for after such offering.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement relating to any subscription rights we
    may offer will contain the specific terms of the subscription
    rights. These terms may include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the price, if any, for the subscription rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the exercise price payable for each share of common stock,
    preferred stock, debt securities or other securities upon the
    exercise of the subscription rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the number of subscription rights issued to each security holder;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the number and terms of each share of common stock, preferred
    stock, debt securities or other securities which may be
    purchased per each subscription right;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the extent to which the subscription rights are transferable;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any provisions for adjustment of the number or amount of
    securities receivable upon exercise of the subscription rights
    or the exercise price of the subscription rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any other terms of the subscription rights, including the terms,
    procedures and limitations relating to the exchange and exercise
    of the subscription rights;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the date on which the right to exercise the subscription rights
    shall commence, and the date on which the subscription rights
    shall expire;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the extent to which the subscription rights may include an
    over-subscription privilege with respect to unsubscribed
    securities;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    if applicable, the material terms of any standby underwriting or
    purchase arrangement entered into by us in connection with the
    offering of subscription rights.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The description in the applicable prospectus supplement of any
    subscription rights we offer will not necessarily be complete
    and will be qualified in its entirety by reference to the
    applicable subscription rights certificate or subscription
    rights agreement, which will be filed with the SEC if we offer
    subscription rights. For more information on how you can obtain
    copies of any subscription rights certificate or subscription
    rights agreement if we offer subscription rights, see
    &#147;Where You Can Find More Information&#148; beginning on
    page&#160;47 of this prospectus. We urge you to read the
    applicable subscription rights certificate, the applicable
    subscription rights agreement and any applicable prospectus
    supplement in their entirety.
</DIV>

<A name='J82419124'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">DESCRIPTION
    OF PURCHASE CONTRACTS AND PURCHASE UNITS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may issue purchase contracts for the purchase or sale of
    common stock, preferred stock or debt securities issued by us or
    by third parties as specified in the applicable prospectus
    supplement. Each purchase contract will entitle the holder
    thereof to purchase or sell, and obligate us to sell or purchase
    on specified dates, such securities at a specified purchase
    price, which may be based on a formula, all as set forth in the
    applicable prospectus supplement. We may, however, satisfy our
    obligations, if any, with respect to any purchase contract by
    delivering the cash value of such purchase contract or the cash
    value of the securities otherwise deliverable, as set forth in
    the applicable prospectus supplement. The applicable prospectus
    supplement will also specify the methods by which the holders
    may purchase or sell such securities, and any acceleration,
    cancellation or termination provisions or other provisions
    relating to the settlement of a purchase contract. The price per
    security and the number of securities may be fixed at the time
    the purchase contracts are entered into or may be determined by
    reference to a specific formula set forth in the applicable
    purchase contracts.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The purchase contracts may be issued separately or as part of
    units consisting of a purchase contract and debt securities or
    debt obligations of third parties, including U.S.&#160;treasury
    securities, or any other securities described in the applicable
    prospectus supplement or any combination of the foregoing,
    securing the holders&#146; obligations to
</DIV>
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    <BR>
    25
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    purchase the securities under the purchase contracts, which we
    refer to herein as &#147;purchase units.&#148; The purchase
    contracts may require holders to secure their obligations under
    the purchase contracts in a specified manner. The purchase
    contracts also may require us to make periodic payments to the
    holders of the purchase contracts or the purchase units, as the
    case may be, or vice versa, and those payments may be unsecured
    or pre-funded on some basis.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The prospectus supplement relating to any purchase contracts or
    purchase units we may offer will contain the specific terms of
    the purchase contracts or purchase units. These terms may
    include the following:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the purchase contracts obligate the holder to purchase
    or sell, or both, our common stock, preferred stock, or debt
    securities, and the nature and amount of each of those
    securities, or method of determining those amounts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the purchase contracts are to be prepaid or not;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the purchase contracts are to be settled by delivery, or
    by reference or linkage to the value, performance or level of
    our common stock or preferred stock;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any acceleration, cancellation, termination or other provisions
    relating to the settlement of the purchase contracts;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    whether the purchase contracts will be issued in fully
    registered global form.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The description in the applicable prospectus supplement of any
    purchase contract or purchase unit we offer will not necessarily
    be complete and will be qualified in its entirety by reference
    to the applicable purchase contract or purchase unit, which will
    be filed with the SEC if we offer purchase contracts or purchase
    units. For more information on how you can obtain copies of any
    purchase contract or purchase unit we may offer, see &#147;Where
    You Can Find More Information&#148; beginning on page&#160;47 of
    this prospectus. We urge you to read the applicable purchase
    contract or applicable purchase unit and any applicable
    prospectus supplement in their entirety.
</DIV>

<A name='J82419125'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">FEDERAL
    INCOME TAX CONSIDERATIONS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following is a summary of the material U.S.&#160;federal
    income tax consequences of an investment in common stock of
    United Dominion Realty Trust, Inc. For purposes of this section
    under the heading &#147;Federal Income Tax Considerations,&#148;
    references to &#147;UDR,&#148; &#147;we,&#148; &#147;our&#148;
    and &#147;us&#148; mean only United Dominion Realty Trust, Inc.
    and not its subsidiaries or other lower-tier entities, except as
    otherwise indicated. This summary is based upon the Internal
    Revenue Code, the regulations promulgated by the
    U.S.&#160;Treasury Department, rulings and other administrative
    pronouncements issued by the IRS, and judicial decisions, all as
    currently in effect, and all of which are subject to differing
    interpretations or to change, possibly with retroactive effect.
    No assurance can be given that the IRS would not assert, or that
    a court would not sustain, a position contrary to any of the tax
    consequences described below. We have not sought and will not
    seek an advance ruling from the IRS regarding any matter
    discussed in this prospectus. The summary is also based upon the
    assumption that we will operate UDR and its subsidiaries and
    affiliated entities in accordance with their applicable
    organizational documents or partnership agreements. This summary
    is for general information only and is not tax advice. It does
    not purport to discuss all aspects of U.S.&#160;federal income
    taxation that may be important to a particular investor in light
    of its investment or tax circumstances or to investors subject
    to special tax rules, such as:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    financial institutions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    insurance companies;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    broker-dealers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    regulated investment companies;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    partnerships and trusts;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    persons who, as nominees, hold our stock on behalf of other
    persons;
</TD>
</TR>

</TABLE>
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    <BR>
    26
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    persons who receive UDR stock through the exercise of employee
    stock options or otherwise as compensation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    persons holding UDR stock as part of a &#147;straddle,&#148;
    &#147;hedge,&#148; &#147;conversion transaction,&#148;
    &#147;synthetic security&#148; or other integrated investment;
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    and, except to the extent discussed below:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    tax-exempt organizations;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    foreign investors.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This summary assumes that investors will hold their common stock
    as a capital asset, which generally means as property held for
    investment.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>The federal income tax treatment of holders of our common
    stock depends in some instances on determinations of fact and
    interpretations of complex provisions of U.S.&#160;federal
    income tax law for which no clear precedent or authority may be
    available. In addition, the tax consequences to any particular
    stockholder of holding our common stock will depend on the
    stockholder&#146;s particular tax circumstances. A similar tax
    may be payable by persons who hold our stock as nominees on
    behalf of tax-exempt organizations. You are urged to consult
    your tax advisor regarding the federal, state, local, and
    foreign income and other tax consequences to you in light of
    your particular investment or tax circumstances of acquiring,
    holding, exchanging, or otherwise disposing of our common
    stock.</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Taxation
    of UDR</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We elected to be taxed as a REIT under the federal income tax
    laws commencing with our taxable year ended December&#160;31,
    1972. We believe that we have been organized and operated in
    such a manner as to qualify for taxation as a REIT.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The law firm of Skadden, Arps, Slate, Meagher&#160;&#038; Flom
    LLP has acted as our tax counsel in connection with the
    registration statement of which this prospectus is a part. In
    connection with the filing of this prospectus, we expect to
    receive an opinion of Skadden, Arps, Slate, Meagher&#160;&#038;
    Flom LLP to the effect that commencing with UDR&#146;s taxable
    year ending on December&#160;31, 2006, we have been organized in
    conformity with the requirements for qualification and taxation
    as a REIT under the Internal Revenue Code, and that our actual
    and proposed method of operation will enable us to meet the
    requirements for qualification and taxation as a REIT. It must
    be emphasized that the opinion of Skadden, Arps, Slate,
    Meagher&#160;&#038; Flom LLP will be based on various
    assumptions relating to our organization and operation and will
    be conditioned upon fact-based representations and covenants
    made by our management regarding our organization, assets, and
    income, and the future conduct of our business operations. While
    we intend to operate so that we will qualify as a REIT, given
    the highly complex nature of the rules governing REITs, the
    ongoing importance of factual determinations, and the
    possibility of future changes in our circumstances, no assurance
    can be given by Skadden, Arps, Slate, Meagher&#160;&#038; Flom
    LLP or by us that we will qualify as a REIT for any particular
    year. We have asked Skadden, Arps, Slate, Meagher&#160;&#038;
    Flom LLP to assume for purposes of its opinion that any prior
    legal opinions we received to the effect that we were taxable as
    a REIT are correct and the conclusions reached in the opinion of
    Skadden, Arps, Slate, Meagher&#160;&#038; Flom LLP are expressly
    conditioned on the accuracy of such assumption. The opinion will
    be expressed as of the date issued and will not cover subsequent
    periods. Skadden, Arps, Slate, Meagher&#160;&#038; Flom LLP will
    have no obligation to advise us or our stockholders of any
    subsequent change in the matters stated, represented or assumed,
    or of any subsequent change in the applicable law. You should be
    aware that opinions of counsel are not binding on the IRS, and
    no assurance can be given that the IRS will not challenge the
    conclusions set forth in such opinions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Qualification and taxation as a REIT depends on our ability to
    meet on a continuing basis, through actual operating results,
    distribution levels, and diversity of stock and asset ownership,
    various qualification requirements imposed upon REITs by the
    Internal Revenue Code, the compliance with which will not be
    reviewed by Skadden, Arps, Slate, Meagher&#160;&#038; Flom LLP.
    Our ability to qualify as a REIT also requires that we satisfy
    certain asset tests, some of which depend upon the fair market
    values of assets that we own directly or indirectly. Such values
    may not
</DIV>
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    <BR>
    27
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    be susceptible to a precise determination. Accordingly, no
    assurance can be given that the actual results of our operations
    for any taxable year will satisfy such requirements for
    qualification and taxation as a REIT.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Taxation
    of REITs in General</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    As indicated above, our qualification and taxation as a REIT
    depends upon our ability to meet, on a continuing basis, various
    qualification requirements imposed upon REITs by the Internal
    Revenue Code. The material qualification requirements are
    summarized below under &#147;&#151; Requirements for
    Qualification&#160;&#151; General.&#148; While we intend to
    operate so that we qualify as a REIT, no assurance can be given
    that the IRS will not challenge our qualification, or that we
    will be able to operate in accordance with the REIT requirements
    in the future. See &#147;&#151;&#160;Failure to Qualify.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Provided that we qualify as a REIT, generally we will be
    entitled to a deduction for dividends that we pay and therefore
    will not be subject to federal corporate income tax on our
    taxable income that is currently distributed to our
    stockholders. This treatment substantially eliminates the
    &#147;double taxation&#148; at the corporate and stockholder
    levels that generally results from investment in a corporation.
    In general, the income that we generate is taxed only at the
    stockholder level upon a distribution of dividends to our
    stockholders.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    For tax years through 2010, most domestic stockholders that are
    individuals, trusts or estates are taxed on corporate dividends
    at a maximum rate of 15% (the same as long-term capital gains).
    With limited exceptions, however, dividends from us or from
    other entities that are taxed as REITs are generally not
    eligible for this rate and will continue to be taxed at rates
    applicable to ordinary income, which will be as high as 35%
    through 2010. See &#147;Taxation of Stockholders&#160;&#151;
    Taxation of Taxable Domestic Stockholders&#160;&#151;
    Distributions.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Net operating losses, foreign tax credits and other tax
    attributes generally do not pass through to our stockholders.
    See &#147;Taxation of Stockholders.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we qualify as a REIT, we will nonetheless be subject to
    federal tax in the following circumstances:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We will be taxed at regular corporate rates on any undistributed
    taxable income, including undistributed net capital gains.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We may be subject to the &#147;alternative minimum tax&#148; on
    our items of tax preference, including any deductions of net
    operating losses.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we have net income from prohibited transactions, which are,
    in general, sales or other dispositions of inventory or property
    held primarily for sale to customers in the ordinary course of
    business, other than foreclosure property, such income will be
    subject to a 100% tax. See &#147;&#151; Prohibited
    Transactions,&#148; and &#147;&#151;&#160;Foreclosure
    Property,&#148; below.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we elect to treat property that we acquire in connection with
    a foreclosure of a mortgage loan or certain leasehold
    terminations as &#147;foreclosure property,&#148; we may thereby
    avoid the 100% tax on gain from a resale of that property (if
    the sale would otherwise constitute a prohibited transaction),
    but the income from the sale or operation of the property may be
    subject to corporate income tax at the highest applicable rate
    (currently&#160;35%).
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we should fail to satisfy the 75% gross income test or the
    95% gross income test, as discussed below, but nonetheless
    maintain our qualification as a REIT because we satisfy other
    requirements, we will be subject to a 100% tax on an amount
    based on the magnitude of the failure, as adjusted to reflect
    the profit margin associated with our gross income.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we should violate the asset tests (other than certain de
    minimis violations) or other requirements applicable to REITs,
    as described below, and yet maintain our qualification as a REIT
    because there is reasonable cause for the failure and other
    applicable requirements are met, we may be subject to an excise
    tax. In that case, the amount of the excise tax will be at least
    $50,000&#160;per failure, and, in the case of certain asset test
    failures, will be determined as the amount of net income
    generated by the assets in question multiplied by the highest
    corporate tax rate (currently 35%) if that amount exceeds
    $50,000&#160;per failure.
</TD>
</TR>

</TABLE>
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    <BR>
    28
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we should fail to distribute during each calendar year at
    least the sum of (a)&#160;85% of our REIT ordinary income for
    such year, (b)&#160;95% of our REIT capital gain net income for
    such year, and (c)&#160;any undistributed taxable income from
    prior periods, we would be subject to a nondeductible 4% excise
    tax on the excess of the required distribution over the sum of
    (i)&#160;the amounts that we actually distributed and
    (ii)&#160;the amounts we retained and upon which we paid income
    tax at the corporate level.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We may be required to pay monetary penalties to the IRS in
    certain circumstances, including if we fail to meet record
    keeping requirements intended to monitor our compliance with
    rules relating to the composition of a REIT&#146;s stockholders,
    as described below in &#147;&#151; Requirements for
    Qualification&#160;&#151; General.&#148;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    A 100% tax may be imposed on transactions between us and a TRS
    (as described below) that do not reflect arms-length terms.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    If we acquire appreciated assets from a corporation that is not
    a REIT (i.e., a corporation taxable under subchapter C of the
    Internal Revenue Code) in a transaction in which the adjusted
    tax basis of the assets in our hands is determined by reference
    to the adjusted tax basis of the assets in the hands of the
    subchapter C corporation, we may be subject to tax on such
    appreciation at the highest corporate income tax rate then
    applicable if we subsequently recognize gain on a disposition of
    any such assets during the ten-year period following their
    acquisition from the subchapter C corporation.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The earnings of our subsidiaries, including any TRS, are subject
    to federal corporate income tax to the extent that such
    subsidiaries are subchapter C corporations.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, we and our subsidiaries may be subject to a variety
    of taxes, including payroll taxes and state, local, and foreign
    income, property and other taxes on our assets and operations.
    We could also be subject to tax in situations and on
    transactions not presently contemplated.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Requirements
    for Qualification&#160;&#151; General</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Internal Revenue Code defines a REIT as a corporation, trust
    or association:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (1)&#160;that is managed by one or more trustees or directors;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (2)&#160;the beneficial ownership of which is evidenced by
    transferable shares, or by transferable certificates of
    beneficial interest;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (3)&#160;that would be taxable as a domestic corporation but for
    its election to be subject to tax as a REIT;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (4)&#160;that is neither a financial institution nor an
    insurance company subject to specific provisions of the Internal
    Revenue Code;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (5)&#160;the beneficial ownership of which is held by 100 or
    more persons;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (6)&#160;in which, during the last half of each taxable year,
    not more than 50% in value of the outstanding stock is owned,
    directly or indirectly, by five or fewer &#147;individuals&#148;
    (as defined in the Internal Revenue Code to include specified
    tax-exempt entities);&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (7)&#160;which meets other tests described below, including with
    respect to the nature of its income and assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Internal Revenue Code provides that conditions
    (1)&#160;through (4)&#160;must be met during the entire taxable
    year, and that condition (5)&#160;must be met during at least
    335&#160;days of a taxable year of 12&#160;months, or during a
    proportionate part of a shorter taxable year. Conditions
    (5)&#160;and (6)&#160;need not be met during a
    corporation&#146;s initial tax year as a REIT. Our charter
    provides restrictions regarding the ownership and transfers of
    our shares, which are intended to assist us in satisfying the
    share ownership requirements described in conditions
    (5)&#160;and (6)&#160;above.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    To monitor compliance with the share ownership requirements, we
    generally are required to maintain records regarding the actual
    ownership of our shares. To do so, we must demand written
    statements each year from the record holders of significant
    percentages of our stock pursuant to which the record holders
    must disclose the actual owners of the shares (i.e., the persons
    required to include our dividends in their gross income). We
    must maintain a list of those persons failing or refusing to
    comply with this demand as part of our records. We could be
    subject to
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    monetary penalties if we fail to comply with these
    record-keeping requirements. If you fail or refuse to comply
    with the demands, you will be required by Treasury regulations
    to submit a statement with your tax return disclosing your
    actual ownership of our shares and other information.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, a corporation generally may not elect to become a
    REIT unless its taxable year is the calendar year. We have
    adopted December&#160;31 as our year-end, and thereby will
    satisfy this requirement.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Internal Revenue Code provides relief from violations of
    certain of the REIT requirements, in cases where a violation is
    due to reasonable cause and not to willful neglect, and other
    requirements are met, including, in certain cases, the payment
    of a penalty tax that is based upon the magnitude of the
    violation. See &#147;&#151; Income Tests&#148; and
    &#147;&#151;&#160;Asset Tests&#148; below. If we fail to satisfy
    any of the various REIT requirements, there can be no assurance
    that these relief provisions would be available to enable us to
    maintain our qualification as a REIT, and, if such relief
    provisions are available, the amount of any resultant penalty
    tax could be substantial.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Effect
    of Subsidiary Entities</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Ownership of Partnership&#160;Interests.</I>&#160;&#160;If we
    are a partner in an entity that is treated as a partnership for
    federal income tax purposes, Treasury regulations provide that
    we are deemed to own our proportionate share of the
    partnership&#146;s assets, and to earn our proportionate share
    of the partnership&#146;s income, for purposes of the asset and
    gross income tests applicable to REITs. Our proportionate share
    of a partnership&#146;s assets and income is based on our
    capital interest in the partnership (except that for purposes of
    the 10% value test, our proportionate share of the
    partnership&#146;s assets is based on our proportionate interest
    in the equity and certain debt securities issued by the
    partnership). In addition, the assets and gross income of the
    partnership are deemed to retain the same character in our
    hands. Thus, our proportionate share of the assets and items of
    income of any of our subsidiary partnerships will be treated as
    our assets and items of income for purposes of applying the REIT
    requirements. A summary of certain rules governing the federal
    income taxation of partnerships and their partners is provided
    below in &#147;Tax Aspects of Investments in Affiliated
    Partnerships.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Disregarded Subsidiaries.</I>&#160;&#160;If we own a
    corporate subsidiary that is a &#147;qualified REIT
    subsidiary,&#148; that subsidiary is generally disregarded for
    federal income tax purposes, and all of the subsidiary&#146;s
    assets, liabilities and items of income, deduction and credit
    are treated as our assets, liabilities and items of income,
    deduction and credit, including for purposes of the gross income
    and asset tests applicable to REITs. A qualified REIT subsidiary
    is any corporation, other than a TRS (as described below) that
    is directly or indirectly wholly-owned by a REIT. Other entities
    that are wholly-owned by us, including single member limited
    liability companies that have not elected to be taxed as
    corporations for federal income tax purposes, are also generally
    disregarded as separate entities for federal income tax
    purposes, including for purposes of the REIT income and asset
    tests. Disregarded subsidiaries, along with any partnerships in
    which UDR holds an equity interest, are sometimes referred to
    herein as &#147;pass-through subsidiaries.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the event that a disregarded subsidiary of ours ceases to be
    wholly-owned&#160;&#151; for example, if any equity interest in
    the subsidiary is acquired by a person other than us or another
    disregarded subsidiary of ours&#160;&#151; the subsidiary&#146;s
    separate existence would no longer be disregarded for federal
    income tax purposes. Instead, the subsidiary would have multiple
    owners and would be treated as either a partnership or a taxable
    corporation. Such an event could, depending on the
    circumstances, adversely affect our ability to satisfy the
    various asset and gross income requirements applicable to REITs,
    including the requirement that REITs generally may not own,
    directly or indirectly, more than 10% of the securities of
    another corporation. See &#147;&#151; Asset Tests&#148; and
    &#147;&#151; Income Tests.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Taxable Subsidiaries.</I>&#160;&#160;In general, we may
    jointly elect with a subsidiary corporation, whether or not
    wholly-owned, to treat the subsidiary corporation as a TRS. We
    generally may not own more than 10% of the securities of a
    taxable corporation, as measured by voting power or value,
    unless we and such corporation elect to treat such corporation
    as a TRS. The separate existence of a TRS or other taxable
    corporation is not ignored for federal income tax purposes.
    Accordingly, a TRS or other taxable corporation generally would
    be subject to corporate income tax on its earnings, which may
    reduce the cash flow that we and our subsidiaries generate in
    the aggregate, and may reduce our ability to make distributions
    to our stockholders.
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We are not treated as holding the assets of a TRS or other
    taxable subsidiary corporation or as receiving any income that
    the subsidiary earns. Rather, the stock issued by a taxable
    subsidiary to us is an asset in our hands, and we treat the
    dividends paid to us from such taxable subsidiary, if any, as
    income. This treatment can affect our income and asset test
    calculations, as described below. Because we do not include the
    assets and income of TRSs or other taxable subsidiary
    corporations in determining our compliance with the REIT
    requirements, we may use such entities to undertake indirectly
    activities that the REIT rules might otherwise preclude us from
    doing directly or through pass-through subsidiaries. For
    example, we may use TRSs or other taxable subsidiary
    corporations to conduct activities that give rise to certain
    categories of income such as management fees or to conduct
    activities that, if conducted by us directly, would be treated
    as prohibited transactions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Income
    Tests</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In order to qualify as a REIT, we must satisfy two gross income
    requirements on an annual basis. First, at least 75% of our
    gross income for each taxable year, excluding gross income from
    sales of inventory or dealer property in &#147;prohibited
    transactions&#148; and certain hedging transactions, generally
    must be derived from investments relating to real property or
    mortgages on real property, including interest income derived
    from mortgage loans secured by real property (including certain
    types of mortgage backed securities), &#147;rents from real
    property,&#148; dividends received from other REITs, and gains
    from the sale of real estate assets, as well as specified income
    from temporary investments. Second, at least 95% of our gross
    income in each taxable year, excluding gross income from
    prohibited transactions and certain hedging transactions, must
    be derived from some combination of such income from investments
    in real property (i.e., income that qualifies under the 75%
    income test described above), as well as other dividends,
    interest, and gain from the sale or disposition of stock or
    securities, which need not have any relation to real property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Rents we receive from a tenant will qualify as &#147;rents from
    real property&#148; for the purpose of satisfying the gross
    income requirements for a REIT described above only if all of
    the following conditions are met:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The amount of rent must not be based in any way on the income or
    profits of any person. However, an amount we receive or accrue
    generally will not be excluded from the term &#147;rents from
    real property&#148; solely because it is based on a fixed
    percentage or percentages of receipts or sales;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We, or an actual or constructive owner of 10% or more of our
    stock, must not actually or constructively own 10% or more of
    the interests in the assets or net profits of the tenant, or, if
    the tenant is a corporation, 10% or more of the voting power or
    value of all classes of stock of the tenant;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Rent attributable to personal property, leased in connection
    with a lease of real property, is not greater than 15% of the
    total rent received under the lease. If this condition is not
    met, then the portion of the rent attributable to personal
    property will not qualify as &#147;rents from real
    property&#148;;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    We generally must not operate or manage the property or furnish
    or render services to our tenants, subject to a 1% de minimis
    exception and except as provided below. We may, however, perform
    services that are &#147;usually or customarily rendered&#148; in
    connection with the rental of space for occupancy only and are
    not otherwise considered &#147;rendered to the occupant&#148; of
    the property. Examples of these services include the provision
    of light, heat, or other utilities, trash removal and general
    maintenance of common areas. In addition, we may employ an
    independent contractor from whom we derive no income to provide
    customary services, or a taxable REIT subsidiary, which may be
    wholly or partially owned by us, to provide both customary and
    non-customary services to our tenants without causing the rent
    we receive from those tenants to fail to qualify as &#147;rents
    from real property.&#148; Any amounts we receive from a taxable
    REIT subsidiary with respect to the taxable REIT
    subsidiary&#146;s provision of non-customary services will,
    however, be nonqualifying income under the 75% gross income test
    and, except to the extent received through the payment of
    dividends, the 95% REIT gross income test.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We generally do not intend, and as the general partner of
    certain subsidiary partnerships do not intend to permit our
    subsidiary partnerships, to take actions we believe will cause
    us to fail to satisfy the rental conditions described above. In
    addition, with respect to the limitation on the rental of
    personal property, we have not obtained appraisals
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    of the real property and personal property leased to tenants.
    Accordingly, there can be no assurance that the IRS will agree
    with our determinations of value.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Income we receive that is attributable to the rental of parking
    spaces at the properties will constitute rents from real
    property for purposes of the REIT gross income tests if certain
    services provided with respect to the parking facilities are
    performed by independent contractors from whom we derive no
    income, either directly or indirectly, or by a taxable REIT
    subsidiary, and certain other conditions are met. We believe
    that the income we receive that is attributable to parking
    facilities meets these tests and, accordingly, will constitute
    rents from real property for purposes of the REIT gross income
    tests.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    From time to time, we may enter into hedging transactions with
    respect to one or more of our liabilities. The term
    &#147;hedging transaction&#148; generally means any transaction
    we enter into in the normal course of our business primarily to
    manage risk of interest rate changes or fluctuations with
    respect to borrowings made or to be made. The hedging activities
    may include entering into interest rate swaps, caps, and floors,
    options to purchase these items, and futures and forward
    contracts. Income from a hedging transaction, including gain
    from the sale or disposition of such a transaction, that is
    clearly identified as such as specified in the Code will not
    constitute gross income for purposes of the 75% or 95% gross
    income test (for transactions entered into prior to
    July&#160;31, 2008, hedging transaction income will not
    constitute gross income for purposes of the 95% gross income
    test only), and therefore will be exempt from this test. To the
    extent that we do not properly identify such transactions as
    hedges, the income from those transactions is not likely to be
    treated as qualifying income for purposes of the gross income
    tests. We intend to structure any hedging transactions in a
    manner that does not jeopardize our status as a REIT.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may directly or indirectly receive distributions from TRSs or
    other corporations that are not REITs or qualified REIT
    subsidiaries. These distributions generally are treated as
    dividend income to the extent of the earnings and profits of the
    distributing corporation. Such distributions will generally
    constitute qualifying income for purposes of the 95% gross
    income test, but not for purposes of the 75% gross income test.
    Any dividends that we receive from a REIT, however, will be
    qualifying income for purposes of both the 95% and 75% gross
    income tests.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Interest income constitutes qualifying mortgage interest for
    purposes of the 75% gross income test to the extent that the
    obligation upon which such interest is paid is secured by a
    mortgage on real property. If we receive interest income with
    respect to a mortgage loan that is secured by both real property
    and other property, and the highest principal amount of the loan
    outstanding during a taxable year exceeds the fair market value
    of the real property on the date that we acquired or originated
    the mortgage loan, the interest income will be apportioned
    between the real property and the other collateral, and our
    income from the arrangement will qualify for purposes of the 75%
    gross income test only to the extent that the interest is
    allocable to the real property. Even if a loan is not secured by
    real property, or is undersecured, the income that it generates
    may nonetheless qualify for purposes of the 95% gross income
    test.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we fail to satisfy one or both of the 75% or 95% gross income
    tests for any taxable year, we may still qualify as a REIT for
    such year if we are entitled to relief under applicable
    provisions of the Internal Revenue Code. These relief provisions
    will be generally available if (1)&#160;our failure to meet
    these tests was due to reasonable cause and not due to willful
    neglect and (2)&#160;following our identification of the failure
    to meet the 75% or 95% gross income test for any taxable year,
    we file a schedule with the IRS setting forth each item of our
    gross income for purposes of the 75% or 95% gross income test
    for such taxable year in accordance with Treasury regulations
    yet to be issued. It is not possible to state whether we would
    be entitled to the benefit of these relief provisions in all
    circumstances. If these relief provisions are inapplicable to a
    particular set of circumstances, we will not qualify as a REIT.
    As discussed above under &#147;&#151; Taxation of REITs in
    General,&#148; even where these relief provisions apply, the
    Internal Revenue Code imposes a tax based upon the amount by
    which we fail to satisfy the particular income test.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under The Housing and Economic Recovery Tax Act of 2008, the
    Secretary of the Treasury has been given broad authority to
    determine whether particular items of gain or income recognized
    after July&#160;30, 2008, qualify or not under the 75% and 95%
    gross income tests, or are to be excluded from the measure of
    gross income for such purposes.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Asset
    Tests</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    At the close of each calendar quarter, we must also satisfy four
    tests relating to the nature of our assets. First, at least 75%
    of the value of our total assets must be represented by some
    combination of &#147;real estate assets,&#148; cash, cash items,
    U.S.&#160;government securities, and, under some circumstances,
    stock or debt instruments purchased with new capital. For this
    purpose, real estate assets include interests in real property,
    such as land, buildings, leasehold interests in real property,
    stock of other corporations that qualify as REITs, and some
    kinds of mortgage-backed securities and mortgage loans. Assets
    that do not qualify for purposes of the 75% gross test are
    subject to the additional asset tests described below.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Second, the value of any one issuer&#146;s securities that we
    own may not exceed 5% of the value of our total assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Third, we may not own more than 10% of any one issuer&#146;s
    outstanding securities, as measured by either voting power or
    value. The 5% and 10% asset tests do not apply to securities of
    TRSs and qualified REIT subsidiaries and the 10% asset test does
    not apply to &#147;straight debt&#148; having specified
    characteristics and to certain other securities described below.
    Solely for purposes of the 10% asset test, the determination of
    our interest in the assets of a partnership or limited liability
    company in which we own an interest will be based on our
    proportionate interest in any securities issued by the
    partnership or limited liability company, excluding for this
    purpose certain securities described in the Code.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Fourth, the aggregate value of all securities of TRSs that we
    hold may not exceed 25% (20% with respect to taxable years
    commencing prior to July&#160;31, 2008)&#160;of the value of our
    total assets.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Notwithstanding the general rule, as noted above, that for
    purposes of the REIT income and asset tests we are treated as
    owning our proportionate share of the underlying assets of a
    subsidiary partnership, if we hold indebtedness issued by a
    partnership, the indebtedness will be subject to, and may cause
    a violation of, the asset tests unless the indebtedness is a
    qualifying mortgage asset or other conditions are met.
    Similarly, although stock of another REIT is a qualifying asset
    for purposes of the REIT asset tests, any non-mortgage debt that
    is issued by another REIT may not so qualify (such debt,
    however, will not be treated as &#147;securities&#148; for
    purposes of the 10% asset test, as explained below).
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Certain securities will not cause a violation of the 10% asset
    test described above. Such securities include instruments that
    constitute &#147;straight debt,&#148; which includes, among
    other things, securities having certain contingency features. A
    security does not qualify as &#147;straight debt&#148; where a
    REIT (or a controlled TRS of the REIT) owns other securities of
    the same issuer which do not qualify as straight debt, unless
    the value of those other securities constitute, in the
    aggregate, 1% or less of the total value of that issuer&#146;s
    outstanding securities. In addition to straight debt, the
    Internal Revenue Code provides that certain other securities
    will not violate the 10% asset test. Such securities include
    (1)&#160;any loan made to an individual or an estate,
    (2)&#160;certain rental agreements pursuant to which one or more
    payments are to be made in subsequent years (other than
    agreements between a REIT and certain persons related to the
    REIT under attribution rules), (3)&#160;any obligation to pay
    rents from real property, (4)&#160;securities issued by
    governmental entities that are not dependent in whole or in part
    on the profits of (or payments made by) a non-governmental
    entity, (5)&#160;any security (including debt securities) issued
    by another REIT, and (6)&#160;any debt instrument issued by a
    partnership if the partnership&#146;s income is of a nature that
    it would satisfy the 75% gross income test described above under
    &#147;&#151; Income Tests.&#148; In applying the 10% asset test,
    a debt security issued by a partnership is not taken into
    account to the extent, if any, of the REIT&#146;s proportionate
    interest in the equity and certain debt securities issued by
    that partnership.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    No independent appraisals have been obtained to support our
    conclusions as to the value of our total assets or the value of
    any particular security or securities. Moreover, values of some
    assets, including instruments issued in securitization
    transactions, may not be susceptible to a precise determination,
    and values are subject to change in the future. Furthermore, the
    proper classification of an instrument as debt or equity for
    federal income tax purposes may be uncertain in some
    circumstances, which could affect the application of the REIT
    asset requirements. Accordingly, there can be no assurance that
    the IRS will not contend that our interests in our subsidiaries
    or in the securities of other issuers will not cause a violation
    of the REIT asset tests.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    However, certain relief provisions are available to allow REITs
    to satisfy the asset requirements or to maintain REIT
    qualification notwithstanding certain violations of the asset
    and other requirements. One such provision
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    allows a REIT which fails one or more of the asset requirements
    to nevertheless maintain its REIT qualification if (1)&#160;the
    REIT provides the IRS with a description of each asset causing
    the failure, (2)&#160;the failure is due to reasonable cause and
    not willful neglect, (3)&#160;the REIT pays a tax equal to the
    greater of (a)&#160;$50,000&#160;per failure, and (b)&#160;the
    product of the net income generated by the assets that caused
    the failure multiplied by the highest applicable corporate tax
    rate (currently 35%), and (4)&#160;the REIT either disposes of
    the assets causing the failure within six months after the last
    day of the quarter in which it identifies the failure, or
    otherwise satisfies the relevant asset tests within that time
    frame.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the case of <I>de minimis </I>violations of the 10% and 5%
    asset tests, a REIT may maintain its qualification despite a
    violation of such requirements if (1)&#160;the value of the
    assets causing the violation does not exceed the lesser of 1% of
    the REIT&#146;s total assets and $10,000,000, and (2)&#160;the
    REIT either disposes of the assets causing the failure within
    six months after the last day of the quarter in which it
    identifies the failure, or the relevant tests are otherwise
    satisfied within that time frame.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we should fail to satisfy the asset tests at the end of a
    calendar quarter, such a failure would not cause us to lose our
    REIT qualification if we (1)&#160;satisfied the asset tests at
    the close of the preceding calendar quarter and (2)&#160;the
    discrepancy between the value of our assets and the asset
    requirements was not wholly or partly caused by an acquisition
    of non-qualifying assets, but instead arose from changes in the
    market value of our assets. If the condition described in
    (2)&#160;were not satisfied, we still could avoid
    disqualification by eliminating any discrepancy within
    30&#160;days after the close of the calendar quarter in which it
    arose or by making use of relief provisions described below.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Annual
    Distribution Requirements</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In order to qualify as a REIT, we are required to distribute
    dividends, other than capital gain dividends, to our
    stockholders in an amount at least equal to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (a)&#160;the sum of
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (1)&#160;90% of our &#147;REIT taxable income,&#148; computed
    without regard to our net capital gains and the deduction for
    dividends paid,&#160;and
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 8%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (2)&#160;90% of our net income, if any, (after tax) from
    foreclosure property (as described below), minus
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 4%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    (b)&#160;the sum of specified items of non-cash income.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We generally must make these distributions in the taxable year
    to which they relate, or in the following taxable year if
    declared before we timely file our tax return for the year and
    if paid with or before the first regular dividend payment after
    such declaration. In order for distributions to be counted as
    satisfying the annual distribution requirements for REITS, and
    to provide us with a REIT-level tax deduction, the distributions
    must not be &#147;preferential dividends.&#148; A dividend is
    not a preferential dividend if the distribution is (1)&#160;pro
    rata among all outstanding shares of stock within a particular
    class, and (2)&#160;in accordance with the preferences among
    different classes of stock as set forth in our organizational
    documents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    To the extent that we distribute at least 90%, but less than
    100%, of our &#147;REIT taxable income,&#148; as adjusted, we
    will be subject to tax at ordinary corporate tax rates on the
    retained portion. We may elect to retain, rather than
    distribute, our net long-term capital gains and pay tax on such
    gains. In this case, we could elect for our stockholders to
    include their proportionate shares of such undistributed
    long-term capital gains in income, and to receive a
    corresponding credit for their share of the tax that we paid.
    Our stockholders would then increase their adjusted basis of
    their stock by the difference between (a)&#160;the amounts of
    capital gain dividends that we designated and that they include
    in their taxable income, and (b)&#160;the tax that we paid on
    their behalf with respect to that income.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    To the extent that in the future we may have available net
    operating losses carried forward from prior tax years, such
    losses may reduce the amount of distributions that we must make
    in order to comply with the REIT distribution requirements. Such
    losses, however, will generally not affect the character, in the
    hands of our stockholders, of any distributions that are
    actually made as ordinary dividends or capital gains. See
    &#147;&#151; Taxation of Stockholders&#160;&#151; Taxation of
    Taxable Domestic Stockholders&#160;&#151; Distributions.&#148;
</DIV>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we should fail to distribute during each calendar year at
    least the sum of (a)&#160;85% of our REIT ordinary income for
    such year, (b)&#160;95% of our REIT capital gain net income for
    such year, and (c)&#160;any undistributed taxable income from
    prior periods, we would be subject to a non-deductible 4% excise
    tax on the excess of such required distribution over the sum of
    (x)&#160;the amounts actually distributed, and (y)&#160;the
    amounts of income we retained and on which we paid corporate
    income tax.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    It is possible that, from time to time, we may not have
    sufficient cash to meet the distribution requirements due to
    timing differences between our actual receipt of cash, including
    receipt of distributions from our subsidiaries and our inclusion
    of items in income for federal income tax purposes.
    Alternatively, we may declare a taxable dividend payable in cash
    or stock at the election of each shareholder, where the
    aggregate amount of cash to be distributed in such dividend may
    be subject to limitation. In such case, for federal income tax
    purposes, the amount of the dividend paid in stock will be equal
    to the amount of cash that could have been received instead of
    stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the event that such timing differences occur, in order to
    meet the distribution requirements, it might be necessary for us
    to arrange for short-term, or possibly long-term, borrowings or
    to pay dividends in the form of taxable in-kind distributions of
    property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may be able to rectify a failure to meet the distribution
    requirements for a year by paying &#147;deficiency
    dividends&#148; to stockholders in a later year, which may be
    included in our deduction for dividends paid for the earlier
    year. In this case, we may be able to avoid losing REIT
    qualification or being taxed on amounts distributed as
    deficiency dividends. We will be required to pay interest and a
    penalty based on the amount of any deduction taken for
    deficiency dividends.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Prohibited
    Transactions</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Net income that we derive from a prohibited transaction, is
    subject to a 100% tax. The term &#147;prohibited
    transaction&#148; generally includes a sale or other disposition
    of property (other than foreclosure property, as discussed
    below) that is held primarily for sale to customers in the
    ordinary course of a trade or business by us or by a borrower
    that has issued a shared appreciation mortgage or similar debt
    instrument to us. We intend to conduct our operations so that no
    asset that we own (or are treated as owning) will be treated as,
    or as having been, held for sale to customers, and that a sale
    of any such asset will not be treated as having been in the
    ordinary course of our business. Whether property is held
    &#147;primarily for sale to customers in the ordinary course of
    a trade or business&#148; depends on the particular facts and
    circumstances. No assurance can be given that any property that
    we sell will not be treated as property held for sale to
    customers, or that we can comply with certain safe-harbor
    provisions of the Internal Revenue Code that would prevent such
    treatment. The 100% tax does not apply to gains from the sale of
    property that is held through a TRS or other taxable
    corporation, although such income will be subject to tax in the
    hands of the corporation at regular corporate rates.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Foreclosure
    Property</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Foreclosure property is real property and any personal property
    incident to such real property (1)&#160;that we acquire as the
    result of having bid in the property at foreclosure, or having
    otherwise reduced the property to ownership or possession by
    agreement or process of law, after a default (or upon imminent
    default) on a lease of the property or a mortgage loan held by
    us and secured by the property, (2)&#160;for which we acquired
    the related loan or lease at a time when default was not
    imminent or anticipated, and (3)&#160;with respect to which we
    made a proper election to treat the property as foreclosure
    property.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We generally will be subject to tax at the maximum corporate
    rate (currently 35%) on any net income from foreclosure
    property, including any gain from the disposition of the
    foreclosure property, other than income that constitutes
    qualifying income for purposes of the 75% gross income test. Any
    gain from the sale of property for which a foreclosure property
    election has been made will not be subject to the 100% tax on
    gains from prohibited transactions described above, even if the
    property would otherwise constitute inventory or dealer
    property. To the extent that we receive any income from
    foreclosure property that does not qualify for purposes of the
    75% gross income test, we intend to make an election to treat
    the related property as foreclosure property.
</DIV>
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Derivatives
    and Hedging Transactions</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We and our subsidiaries may enter into hedging transactions with
    respect to interest rate exposure on one or more of our assets
    or liabilities. Any such hedging transactions could take a
    variety of forms, including the use of derivative instruments
    such as interest rate swap contracts, interest rate cap or floor
    contracts, futures or forward contracts, and options. Except to
    the extent provided by Treasury regulations, any income from a
    hedging transaction we enter into (1)&#160;in the normal course
    of our business primarily to manage risk of interest rate or
    price changes or currency fluctuations with respect to
    borrowings made or to be made, or ordinary obligations incurred
    or to be incurred, to acquire or carry real estate assets, which
    is clearly identified as specified in Treasury regulations
    before the close of the day on which it was acquired,
    originated, or entered into, including gain from the sale or
    disposition of such a transaction, and (2)&#160;primarily to
    manage risk of currency fluctuations with respect to any item of
    income or gain that would be qualifying income under the 75% or
    95% income tests which is clearly identified as such before the
    close of the day on which it was acquired, originated, or
    entered into, will not constitute gross income for purposes of
    the 75% or 95% gross income test (for transactions entered into
    prior to July&#160;31, 2008, hedging transaction income will not
    constitute gross income for purposes of the 95% gross income
    test only). To the extent that we enter into other types of
    hedging transactions, the income from those transactions is
    likely to be treated as non-qualifying income for purposes of
    both of the 75% and 95% gross income tests. We intend to
    structure any hedging transactions in a manner that does not
    jeopardize our qualification as a REIT. We may conduct some or
    all of our hedging activities (including hedging activities
    relating to currency risk) through a TRS or other corporate
    entity, the income from which may be subject to federal income
    tax, rather than by participating in the arrangements directly
    or through pass-through subsidiaries. No assurance can be given,
    however, that our hedging activities will not give rise to
    income that does not qualify for purposes of either or both of
    the REIT income tests, or that our hedging activities will not
    adversely affect our ability to satisfy the REIT qualification
    requirements.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Failure
    to Qualify</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we fail to satisfy one or more requirements for REIT
    qualification other than the income or asset tests, we could
    avoid disqualification if our failure is due to reasonable cause
    and not to willful neglect and we pay a penalty of $50,000 for
    each such failure. Relief provisions are available for failures
    of the income tests and asset tests, as described above in
    &#147;&#151; Income Tests&#148; and &#147;&#151; Asset
    Tests.&#148;
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If we fail to qualify for taxation as a REIT in any taxable
    year, and the relief provisions described above do not apply, we
    would be subject to tax, including any applicable alternative
    minimum tax, on our taxable income at regular corporate rates.
    We cannot deduct distributions to stockholders in any year in
    which we are not a REIT, nor would we be required to make
    distributions in such a year. In this situation, to the extent
    of current and accumulated earnings and profits, distributions
    to domestic stockholders that are individuals, trusts and
    estates will generally be taxable at capital gains rates
    (through 2010). In addition, subject to the limitations of the
    Internal Revenue Code, corporate distributees may be eligible
    for the dividends received deduction. Unless we are entitled to
    relief under specific statutory provisions, we would also be
    disqualified from re-electing to be taxed as a REIT for the four
    taxable years following the year during which we lost
    qualification. It is not possible to state whether, in all
    circumstances, we would be entitled to this statutory relief.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Tax
    Aspects of Investments in Partnerships</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">General</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may hold investments through entities that are classified as
    partnerships for federal income tax purposes. In general,
    partnerships are &#147;pass-through&#148; entities that are not
    subject to federal income tax. Rather, partners are allocated
    their proportionate shares of the items of income, gain, loss,
    deduction and credit of a partnership, and potentially are
    subject to tax on these items, without regard to whether the
    partners receive a distribution from the partnership. We will
    include in our income our proportionate share of these
    partnership items for purposes of the various REIT income tests
    and in computation of our REIT taxable income. Moreover, for
    purposes of the REIT asset tests, we will include in our
    calculations our proportionate share of any assets held by
    subsidiary partnerships. Our proportionate share of a
    partnership&#146;s assets and income is based on our capital
    interest in the partnership (except that for purposes of the 10%
    value test, our proportionate share is based on our
    proportionate interest in the
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    equity and certain debt securities issued by the partnership).
    See &#147;Taxation of UDR&#160;&#151; Effect of Subsidiary
    Entities&#160;&#151; Ownership of
    Partnership&#160;Interests.&#148;
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Entity
    Classification</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any investment in partnerships involves special tax
    considerations, including the possibility of a challenge by the
    IRS of the status of any subsidiary partnership as a
    partnership, as opposed to an association taxable as a
    corporation, for federal income tax purposes. If any of these
    entities were treated as an association for federal income tax
    purposes, it would be taxable as a corporation and therefore
    could be subject to an entity-level tax on its income. In such a
    situation, the character of our assets and items of gross income
    would change and could preclude us from satisfying the REIT
    asset tests or the income tests as discussed in &#147;Taxation
    of UDR&#160;&#151; Asset Tests&#148; and
    &#147;&#151;&#160;Income Tests,&#148; and in turn could prevent
    us from qualifying as a REIT, unless we are eligible for relief
    from the violation pursuant to the relief provisions described
    above. See &#147;Taxation of UDR&#160;&#151; Asset Tests,&#148;
    &#147;&#151; Income Test&#148; and &#147;&#151; Failure to
    Qualify,&#148; above, for discussion of the effect of failure to
    satisfy the REIT tests for a taxable year, and of the relief
    provisions. In addition, any change in the status of any
    subsidiary partnership for tax purposes might be treated as a
    taxable event, in which case we could have taxable income that
    is subject to the REIT distribution requirements without
    receiving any cash.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Tax
    Allocations with Respect to Partnership Properties</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Under the Internal Revenue Code and the Treasury regulations,
    income, gain, loss and deduction attributable to appreciated or
    depreciated property that is contributed to a partnership in
    exchange for an interest in the partnership must be allocated
    for tax purposes so that the contributing partner is charged
    with, or benefits from, the unrealized gain or unrealized loss
    associated with the property at the time of the contribution.
    The amount of the unrealized gain or unrealized loss is
    generally equal to the difference between the fair market value
    of the contributed property at the time of contribution, and the
    adjusted tax basis of such property at the time of contribution
    (a &#147;book-tax difference&#148;). Such allocations are solely
    for federal income tax purposes and do not affect the book
    capital accounts or other economic or legal arrangements among
    the partners.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    To the extent that any of our subsidiary partnerships acquires
    appreciated (or depreciated) properties by way of capital
    contributions from its partners, allocations would need to be
    made in a manner consistent with these requirements. Where a
    partner contributes cash to a partnership at a time that the
    partnership holds appreciated (or depreciated) property, the
    Treasury regulations provide for a similar allocation of these
    items to the other (i.e., non-contributing) partners. These
    rules may apply to a contribution that we make to any subsidiary
    partnerships of the cash proceeds received in offerings of our
    stock. As a result, the partners of our subsidiary partnerships,
    including us, could be allocated greater or lesser amounts of
    depreciation and taxable income in respect of a
    partnership&#146;s properties than would be the case if all of
    the partnership&#146;s assets (including any contributed assets)
    had a tax basis equal to their fair market values at the time of
    any contributions to that partnership. This could cause us to
    recognize, over a period of time, taxable income in excess of
    cash flow from the partnership, which might adversely affect our
    ability to comply with the REIT distribution requirements
    discussed above.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Taxation
    of Stockholders</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Taxation
    of Taxable Domestic Stockholders</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Distributions.</I>&#160;&#160;So long as we qualify as a
    REIT, the distributions that we make to our taxable domestic
    stockholders out of current or accumulated earnings and profits
    that we do not designate as capital gain dividends will
    generally be taken into account by stockholders as ordinary
    income and will not be eligible for the dividends received
    deduction for corporations. With limited exceptions, our
    dividends are not eligible for taxation at the preferential
    income tax rates (i.e., the 15% maximum federal rate through
    2010)&#160;for qualified dividends received by domestic
    stockholders that are individuals, trusts and estates from
    taxable C corporations. Such stockholders, however, are taxed at
    the preferential rates on dividends designated by and received
    from REITs to the extent that the dividends are attributable to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    income retained by the REIT in the prior taxable year on which
    the REIT was subject to corporate level income tax (less the
    amount of tax);
</TD>
</TR>

</TABLE>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    dividends received by the REIT from TRSs or other taxable C
    corporations;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    income in the prior taxable year from the sales of
    &#147;built-in gain&#148; property acquired by the REIT from
    C&#160;corporations in carryover basis transactions (less the
    amount of corporate tax on such income).
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Distributions that we designate as capital gain dividends will
    generally be taxed to our stockholders as long-term capital
    gains, to the extent that such distributions do not exceed our
    actual net capital gain for the taxable year, without regard to
    the period for which the stockholder that receives such
    distribution has held its stock. We may elect to retain and pay
    taxes on some or all of our net long-term capital gains, in
    which case provisions of the Internal Revenue Code will treat
    our stockholders as having received, solely for tax purposes,
    our undistributed capital gains, and the stockholders will
    receive a corresponding credit for taxes that we paid on such
    undistributed capital gains. See &#147;Taxation of
    UDR&#160;&#151; Annual Distribution Requirements.&#148;
    Corporate stockholders may be required to treat up to 20% of
    some capital gain dividends as ordinary income. Long-term
    capital gains are generally taxable at maximum federal rates of
    15% (through 2010)&#160;in the case of stockholders that are
    individuals, trusts and estates, and 35% in the case of
    stockholders that are corporations. Capital gains attributable
    to the sale of depreciable real property held for more than
    12&#160;months are subject to a 25% maximum federal income tax
    rate for taxpayers who are taxed as individuals, to the extent
    of previously claimed depreciation deductions.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Distributions in excess of our current and accumulated earnings
    and profits will generally represent a return of capital and
    will not be taxable to a stockholder to the extent that the
    amount of such distributions do not exceed the adjusted basis of
    the stockholder&#146;s shares in respect of which the
    distributions were made. Rather, the distribution will reduce
    the adjusted basis of the stockholder&#146;s shares. To the
    extent that such distributions exceed the adjusted basis of a
    stockholder&#146;s shares, the stockholder generally must
    include such distributions in income as long-term capital gain,
    or short-term capital gain if the shares have been held for one
    year or less. In addition, any dividend that we declare in
    October, November or December of any year and that is payable to
    a stockholder of record on a specified date in any such month
    will be treated as both paid by us and received by the
    stockholder on December&#160;31 of such year, provided that we
    actually pay the dividend before the end of January of the
    following calendar year.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    To the extent that we have available net operating losses and
    capital losses carried forward from prior tax years, such losses
    may reduce the amount of distributions that we must make in
    order to comply with the REIT distribution requirements. See
    &#147;Taxation of UDR&#160;&#151; Annual Distribution
    Requirements.&#148; Such losses, however, are not passed through
    to stockholders and do not offset income of stockholders from
    other sources, nor would such losses affect the character of any
    distributions that we make, which are generally subject to tax
    in the hands of stockholders to the extent that we have current
    or accumulated earnings and profits.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Dispositions of UDR Stock.</I>&#160;&#160;In general, capital
    gains recognized by individuals, trusts and estates upon the
    sale or disposition of our stock will be subject to a maximum
    federal income tax rate of 15% (through 2010)&#160;if the stock
    is held for more than one year, and will be taxed at ordinary
    income rates (of up to 35% through 2010)&#160;if the stock is
    held for one year or less. Gains recognized by stockholders that
    are corporations are subject to federal income tax at a maximum
    rate of 35%, whether or not such gains are classified as
    long-term capital gains. Capital losses recognized by a
    stockholder upon the disposition of our stock that was held for
    more than one year at the time of disposition will be considered
    long-term capital losses, and are generally available only to
    offset capital gain income of the stockholder but not ordinary
    income (except in the case of individuals, who may offset up to
    $3,000 of ordinary income each year). In addition, any loss upon
    a sale or exchange of shares of our stock by a stockholder who
    has held the shares for six months or less, after applying
    holding period rules, will be treated as a long-term capital
    loss to the extent of distributions that we make that are
    required to be treated by the stockholder as long-term capital
    gain.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If an investor recognizes a loss upon a subsequent disposition
    of our stock or other securities in an amount that exceeds a
    prescribed threshold, it is possible that the provisions of
    Treasury regulations involving &#147;reportable
    transactions&#148; could apply, with a resulting requirement to
    separately disclose the loss-generating transaction to the IRS.
    These regulations, though directed towards &#147;tax
    shelters,&#148; are broadly written and apply to transactions
    that would not typically be considered tax shelters. The Code
    imposes significant penalties for failure to comply with these
    requirements. You should consult your tax advisor concerning any
    possible disclosure obligation with respect to the receipt or
    disposition of our stock or securities or transactions that we
    might undertake directly or indirectly.
</DIV>
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    38
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Moreover, you should be aware that we and other participants in
    the transactions in which we are involved (including their
    advisors) might be subject to disclosure or other requirements
    pursuant to these regulations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Passive Activity Losses and Investment Interest
    Limitations.</I>&#160;&#160;Distributions that we make and gain
    arising from the sale or exchange by a domestic stockholder of
    our stock will not be treated as passive activity income. As a
    result, stockholders will not be able to apply any &#147;passive
    losses&#148; against income or gain relating to our stock. To
    the extent that distributions we make do not constitute a return
    of capital, they will be treated as investment income for
    purposes of computing the investment interest limitation.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Taxation
    of Foreign Stockholders</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The following is a summary of certain U.S.&#160;federal income
    and estate tax consequences of the ownership and disposition of
    our stock applicable to
    <FONT style="white-space: nowrap">non-U.S.&#160;holders.</FONT>
    A
    <FONT style="white-space: nowrap">&#147;non-U.S.&#160;holder&#148;</FONT>
    is any person other than:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a citizen or resident of the United States;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a corporation (or entity treated as a corporation for
    U.S.&#160;federal income tax purposes) created or organized in
    the United States or under the laws of the United States, or of
    any state thereof, or the District of Columbia;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    an estate, the income of which is includable in gross income for
    U.S.&#160;federal income tax purposes regardless of its
    source;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a trust if a United States court is able to exercise primary
    supervision over the administration of such trust and one or
    more United States fiduciaries have the authority to control all
    substantial decisions of the trust.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If a partnership, including for this purpose any entity that is
    treated as a partnership for U.S.&#160;federal income tax
    purposes, holds our common stock, the tax treatment of a partner
    in the partnership will generally depend upon the status of the
    partner and the activities of the partnership. An investor that
    is a partnership and the partners in such partnership should
    consult their tax advisors about the U.S.&#160;federal income
    tax consequences of the acquisition, ownership and disposition
    of our common stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Ordinary Dividends.</I>&#160;&#160;The portion of dividends
    received by
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    that is (1)&#160;payable out of our earnings and profits,
    (2)&#160;not attributable to our capital gains and (3)&#160;not
    effectively connected with a U.S.&#160;trade or business of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    will be subject to U.S.&#160;withholding tax at the rate of 30%,
    unless reduced or eliminated by treaty.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In general,
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    will not be considered to be engaged in a U.S.&#160;trade or
    business solely as a result of their ownership of our stock. In
    cases where the dividend income from a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    investment in our stock is, or is treated as, effectively
    connected with the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    conduct of a U.S.&#160;trade or business, the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally will be subject to U.S.&#160;federal income tax at
    graduated rates, in the same manner as domestic stockholders are
    taxed with respect to such dividends. Such income generally must
    be reported on a U.S.&#160;income tax return filed by or on
    behalf of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder.</FONT>
    The income may also be subject to the 30% branch profits tax in
    the case of a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is a corporation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Non-Dividend Distributions.</I>&#160;&#160;Unless our stock
    constitutes a U.S.&#160;real property interest (a
    &#147;USRPI&#148;), distributions that we make which are not
    dividends out of our earnings and profits will not be subject to
    U.S.&#160;income tax. If we cannot determine at the time a
    distribution is made whether or not the distribution will exceed
    current and accumulated earnings and profits, the distribution
    will be subject to withholding at the rate applicable to
    dividends. The
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    may seek a refund from the IRS of any amounts withheld if it
    subsequently is determined that the distribution was, in fact,
    in excess of our current and accumulated earnings and profits.
    If our stock constitutes a USRPI, as described below,
    distributions that we make in excess of the sum of (a)&#160;the
    stockholder&#146;s proportionate share of our earnings and
    profits, and (b)&#160;the stockholder&#146;s basis in its stock,
    will be taxed under the Foreign Investment in Real Property Tax
    Act of 1980, or FIRPTA, at the rate of tax, including any
    applicable capital gains rates, that would apply to a domestic
    stockholder of the same type (e.g., an individual or a
    corporation, as the case may be), and the collection of the tax
    will be enforced by a refundable withholding at a rate of 10% of
    the amount by which the distribution exceeds the
    stockholder&#146;s share of our earnings and profits.
</DIV>
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Capital Gain Dividends.</I>&#160;&#160;Under FIRPTA, a
    distribution that we make to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    to the extent attributable to gains from dispositions of USRPIs
    that we held directly or through pass-through subsidiaries, or
    USRPI capital gains, will, except as described below, be
    considered effectively connected with a U.S.&#160;trade or
    business of the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    and will be subject to U.S.&#160;income tax at the rates
    applicable to U.S.&#160;individuals or corporations, without
    regard to whether we designate the distribution as a capital
    gain dividend. See above under &#147;&#151; Taxation of Foreign
    Stockholders&#160;&#151; Ordinary Dividends,&#148; for a
    discussion of the consequences of income that is effectively
    connected with a U.S.&#160;trade or business. In addition, we
    will be required to withhold tax equal to 35% of the maximum
    amount that could have been designated as USRPI capital gains
    dividends. Distributions subject to FIRPTA may also be subject
    to a 30% branch profits tax in the hands of a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that is a corporation. A distribution is not a USRPI capital
    gain if we held an interest in the underlying asset solely as a
    creditor. Capital gain dividends received by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    that are attributable to dispositions of our assets other than
    USRPIs are not subject to U.S.&#160;federal income or
    withholding tax, unless (1)&#160;the gain is effectively
    connected with the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    U.S.&#160;trade or business, in which case the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    would be subject to the same treatment as U.S.&#160;holders with
    respect to such gain, or (2)&#160;the non- U.S.&#160;holder is a
    nonresident alien individual who was present in the United
    States for 183&#160;days or more during the taxable year and has
    a &#147;tax home&#148; in the United States, in which case the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    will incur a 30% tax on his or her capital gains.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A capital gain dividend that would otherwise have been treated
    as a USRPI capital gain will not be so treated or be subject to
    FIRPTA, and generally will not be treated as income that is
    effectively connected with a U.S.&#160;trade or business, and
    instead will be treated in the same manner as an ordinary
    dividend (see &#147;&#151; Taxation of Foreign
    Stockholders&#160;&#151; Ordinary Dividends&#148;), if
    (1)&#160;the capital gain dividend is received with respect to a
    class of stock that is regularly traded on an established
    securities market located in the United States, and (2)&#160;the
    recipient
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    does not own more than 5% of that class of stock at any time
    during the year ending on the date on which the capital gain
    dividend is received. We anticipate that our common stock will
    be &#147;regularly traded&#148; on an established securities
    exchange.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Dispositions of UDR Stock.</I>&#160;&#160;Unless our stock
    constitutes a USRPI, a sale of our stock by a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    generally will not be subject to U.S.&#160;taxation under
    FIRPTA. Our stock will not be treated as a USRPI if less than
    50% of our assets throughout a prescribed testing period consist
    of interests in real property located within the United States,
    excluding, for this purpose, interests in real property solely
    in a capacity as a creditor.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Even if the foregoing 50% test is not met, our stock nonetheless
    will not constitute a USRPI if we are a
    &#147;domestically-controlled qualified investment entity.&#148;
    A domestically-controlled qualified investment entity includes a
    REIT, less than 50% of value of which is held directly or
    indirectly by
    <FONT style="white-space: nowrap">non-U.S.&#160;holders</FONT>
    at all times during a specified testing period. We believe that
    we are, and we will be, a domestically-controlled qualified
    investment entity, and that a sale of our stock should not be
    subject to taxation under FIRPTA. However, no assurance can be
    given that we are or will remain a domestically-controlled
    qualified investment entity.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In the event that we are not a domestically-controlled qualified
    investment entity, but our stock is &#147;regularly
    traded,&#148; as defined by applicable Treasury regulations, on
    an established securities market, a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    sale of our common stock nonetheless would not be subject to tax
    under FIRPTA as a sale of a USRPI, provided that the selling
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    held 5% or less of our outstanding common stock any time during
    the one-year period ending on the date of the sale. We expect
    that our common stock will be publicly traded.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If gain on the sale of our stock were subject to taxation under
    FIRPTA, the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    would be required to file a U.S.&#160;federal income tax return
    and would be subject to the same treatment as a
    U.S.&#160;stockholder with respect to such gain, subject to
    applicable alternative minimum tax and a special alternative
    minimum tax in the case of non-resident alien individuals, and
    the purchaser of the stock could be required to withhold 10% of
    the purchase price and remit such amount to the IRS.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Gain from the sale of our stock that would not otherwise be
    subject to FIRPTA will nonetheless be taxable in the United
    States to a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    in two cases: (1)&#160;if the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder&#146;s</FONT>
    investment in our stock is effectively connected with a
    U.S.&#160;trade or business conducted by such
    <FONT style="white-space: nowrap">non-U.S.&#160;holder,</FONT>
    the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    will be subject to the same treatment as a U.S.&#160;stockholder
    with respect to such gain, or (2)&#160;if the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    is a nonresident alien individual who was present in the United
    States for 183&#160;days or more during the taxable year and has
    a &#147;tax home&#148; in the United States, the nonresident
    alien individual will be subject to a 30% tax on the
    individual&#146;s capital gain. In
</DIV>
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    addition, even if we are a domestically controlled qualified
    investment entity, upon disposition of our stock (subject to the
    5% exception applicable to &#147;regularly traded&#148; stock
    described above), a
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    may be treated as having gain from the sale or exchange of a
    USRPI if the
    <FONT style="white-space: nowrap">non-U.S.&#160;holder</FONT>
    (1)&#160;disposes of our common stock within a
    <FONT style="white-space: nowrap">30-day</FONT>
    period preceding the ex-dividend date of a distribution, any
    portion of which, but for the disposition, would have been
    treated as gain from the sale or exchange of a USRPI and
    (2)&#160;acquires, or enters into a contract or option to
    acquire, other shares of our common stock within 30&#160;days
    after such ex-dividend date.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <I>Estate Tax.</I>&#160;&#160;If our stock is owned or treated
    as owned by an individual who is not a citizen or resident (as
    specially defined for U.S.&#160;federal estate tax purposes) of
    the United States at the time of such individual&#146;s death,
    the stock will be includable in the individual&#146;s gross
    estate for U.S.&#160;federal estate tax purposes, unless an
    applicable estate tax treaty provides otherwise, and may
    therefore be subject to U.S.&#160;federal estate tax.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Taxation
    of Tax-Exempt Stockholders</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Tax-exempt entities, including qualified employee pension and
    profit sharing trusts and individual retirement accounts,
    generally are exempt from federal income taxation. However, they
    may be subject to taxation on their unrelated business taxable
    income, or UBTI. While some investments in real estate may
    generate UBTI, the IRS has ruled that dividend distributions
    from a REIT to a tax-exempt entity do not constitute UBTI. Based
    on that ruling, and provided that (1)&#160;a tax-exempt
    stockholder has not held our stock as &#147;debt financed
    property&#148; within the meaning of the Internal Revenue Code
    (i.e., where the acquisition or holding of the property is
    financed through a borrowing by the tax-exempt stockholder), and
    (2)&#160;our stock is not otherwise used in an unrelated trade
    or business, distributions that we make and income from the sale
    of our stock generally should not give rise to UBTI to a
    tax-exempt stockholder.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Tax-exempt stockholders that are social clubs, voluntary
    employee benefit associations, supplemental unemployment benefit
    trusts, and qualified group legal services plans exempt from
    federal income taxation under sections&#160;501(c)(7), (c)(9),
    (c)(17) and (c)(20) of the Internal Revenue Code are subject to
    different UBTI rules, which generally require such stockholders
    to characterize distributions that we make as UBTI.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In certain circumstances, a pension trust that owns more than
    10% of our stock could be required to treat a percentage of the
    dividends as UBTI if we are a &#147;pension-held REIT.&#148; We
    will not be a pension-held REIT unless (1)&#160;we are required
    to &#147;look through&#148; one or more of our pension trust
    stockholders in order to satisfy the REIT
    &#147;closely-held&#148; test, and (2)&#160;either (i)&#160;one
    pension trust owns more than 25% of the value of our stock, or
    (ii)&#160;one or more pension trusts, each individually holding
    more than 10% of the value of our stock, collectively owns more
    than 50% of the value of our stock. Certain restrictions on
    ownership and transfer of our stock generally should prevent a
    tax-exempt entity from owning more than 10% of the value of our
    stock and generally should prevent us from becoming a
    pension-held REIT.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B>Tax-exempt stockholders are urged to consult their tax
    advisors regarding the federal, state, local and foreign income
    and other tax consequences of owning UDR stock.</B>
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Other Tax
    Considerations</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Dividend
    Reinvestment Program</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Stockholders participating in our common stock dividend
    reinvestment program are treated as having received the gross
    amount of any cash distributions which would have been paid by
    us to such stockholders had they not elected to participate in
    the program. These distributions will retain the character and
    tax effect applicable to distributions from us generally.
    Participants in the dividend reinvestment program are subject to
    U.S.&#160;federal income and withholding tax on the amount of
    the deemed distributions to the extent that such distributions
    represent dividends or gains, even though they receive no cash.
    Shares of our common stock received under the program will have
    a holding period beginning with the day after purchase, and a
    tax basis equal to their cost (which is the gross amount of the
    distribution).
</DIV>
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    <BR>
    41
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">Legislative
    or Other Actions Affecting REITs</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The rules dealing with federal income taxation are constantly
    under review by persons involved in the legislative process and
    by the IRS and the U.S.&#160;Treasury Department. Changes to the
    federal tax laws and interpretations thereof could adversely
    affect an investment in our stock.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The Housing and Economic Recovery Tax Act of 2008 (the
    &#147;2008 Act&#148;) contains a number of rules intended to
    permit REITs additional flexibility in conducting their
    operations. For example, the 2008 Act liberalizes the rules
    relating to foreign currency income associated with real estate
    activities and permits the value of taxable REIT subsidiaries to
    represent up to 25% of a REIT&#146;s assets (rather than the
    current 20% limit). The 2008 Act, among other things, shortens
    from four years to two years the minimum holding period under
    the safe harbor provisions of the Code that prevent the
    imposition of the 100% prohibited transactions tax. While the
    2008 Act generally applies to taxable years beginning after the
    date of enactment, the rules relating to the prohibited
    transaction safe harbor apply to sales made after the date of
    enactment.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 2%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><I><FONT style="font-family: 'Times New Roman', Times">State,
    Local and Foreign Taxes</FONT></I></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We and our subsidiaries and stockholders may be subject to
    state, local or foreign taxation in various jurisdictions
    including those in which we or they transact business, own
    property or reside. We may own properties located in numerous
    jurisdictions, and may be required to file tax returns in some
    or all of those jurisdictions. Our state, local or foreign tax
    treatment and that of our stockholders may not conform to the
    federal income tax treatment discussed above. We may pay foreign
    property taxes, and dispositions of foreign property or
    operations involving, or investments in, foreign property may
    give rise to foreign income or other tax liability in amounts
    that could be substantial. Any foreign taxes that we incur do
    not pass through to stockholders as a credit against their
    U.S.&#160;federal income tax liability. Prospective investors
    should consult their tax advisors regarding the application and
    effect of state, local and foreign income and other tax laws on
    an investment in our stock.
</DIV>

<A name='J82419126'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">SELLING
    SECURITY HOLDERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Information about selling security holders, where applicable,
    will be set forth in a prospectus supplement, in a
    post-effective amendment, or in filings we make with the SEC
    under the Exchange Act which are incorporated by reference.
</DIV>

<A name='J82419127'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">PLAN OF
    DISTRIBUTION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may sell the securities offered by this prospectus from time
    to time in one or more transactions, including without
    limitation:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    directly to one or more purchasers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    through agents;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    to or through underwriters, brokers or dealers;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    through a combination of any of these methods.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A distribution of the securities offered by this prospectus may
    also be effected through the issuance of derivative securities,
    including without limitation, warrants, subscriptions,
    exchangeable securities, forward delivery contracts and the
    writing of options.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, the manner in which we may sell some or all of the
    securities covered by this prospectus includes, without
    limitation, through:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    a block trade in which a broker-dealer will attempt to sell as
    agent, but may position or resell a portion of the block, as
    principal, in order to facilitate the transaction;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    purchases by a broker-dealer, as principal, and resale by the
    broker-dealer for its account;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    ordinary brokerage transactions and transactions in which a
    broker solicits purchasers;&#160;or
</TD>
</TR>

</TABLE>
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<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    42
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    privately negotiated transactions.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may also enter into hedging transactions. For example, we may:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into transactions with a broker-dealer or affiliate
    thereof in connection with which such broker-dealer or affiliate
    will engage in short sales of the common stock pursuant to this
    prospectus, in which case such broker-dealer or affiliate may
    use shares of common stock received from us to close out its
    short positions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    sell securities short and redeliver such shares to close out our
    short positions;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    enter into option or other types of transactions that require us
    to deliver common stock to a broker-dealer or an affiliate
    thereof, who will then resell or transfer the common stock under
    this prospectus;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    loan or pledge the common stock to a broker-dealer or an
    affiliate thereof, who may sell the loaned shares or, in an
    event of default in the case of a pledge, sell the pledged
    shares pursuant to this prospectus.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In addition, we may enter into derivative or hedging
    transactions with third parties, or sell securities not covered
    by this prospectus to third parties in privately negotiated
    transactions. In connection with such a transaction, the third
    parties may sell securities covered by and pursuant to this
    prospectus and an applicable prospectus supplement or pricing
    supplement, as the case may be. If so, the third party may use
    securities borrowed from us or others to settle such sales and
    may use securities received from us to close out any related
    short positions. We may also loan or pledge securities covered
    by this prospectus and an applicable prospectus supplement to
    third parties, who may sell the loaned securities or, in an
    event of default in the case of a pledge, sell the pledged
    securities pursuant to this prospectus and the applicable
    prospectus supplement or pricing supplement, as the case may be.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    A prospectus supplement with respect to each offering of
    securities will state the terms of the offering of the
    securities, including:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the name or names of any underwriters or agents and the amounts
    of securities underwritten or purchased by each of them, if any;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    the public offering price or purchase price of the securities
    and the net proceeds to be received by us from the sale;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any delayed delivery arrangements;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any underwriting discounts or agency fees and other items
    constituting underwriters&#146; or agents&#146; compensation;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any discounts or concessions allowed or reallowed or paid to
    dealers;&#160;and
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    any securities exchange or markets on which the securities may
    be listed.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The offer and sale of the securities described in this
    prospectus by us, the underwriters or the third parties
    described above may be effected from time to time in one or more
    transactions, including privately negotiated transactions,
    either:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at a fixed price or prices, which may be changed;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at market prices prevailing at the time of sale;
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at prices related to the prevailing market prices;&#160;or
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    at negotiated prices.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">General</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Any public offering price and any discounts, commissions,
    concessions or other items constituting compensation allowed or
    reallowed or paid to underwriters, dealers, agents or
    remarketing firms may be changed from time to time.
    Underwriters, dealers, agents and remarketing firms that
    participate in the distribution of the offered securities may be
    &#147;underwriters&#148; as defined in the Securities Act. Any
    discounts or commissions they receive from us and any profits
    they receive on the resale of the offered securities may be
    treated as underwriting discounts and
</DIV>
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    <BR>
    43
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<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    commissions under the Securities Act. We will identify any
    underwriters, agents or dealers and describe their commissions,
    fees or discounts in the applicable prospectus supplement or
    pricing supplement, as the case may be.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Underwriters
    and Agents</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If underwriters are used in a sale, they will acquire the
    offered securities for their own account. The underwriters may
    resell the offered securities in one or more transactions,
    including negotiated transactions. These sales may be made at a
    fixed public offering price or prices, which may be changed, at
    market prices prevailing at the time of the sale, at prices
    related to such prevailing market price or at negotiated prices.
    We may offer the securities to the public through an
    underwriting syndicate or through a single underwriter. The
    underwriters in any particular offering will be mentioned in the
    applicable prospectus supplement or pricing supplement, as the
    case may be.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise specified in connection with any particular
    offering of securities, the obligations of the underwriters to
    purchase the offered securities will be subject to certain
    conditions contained in an underwriting agreement that we will
    enter into with the underwriters at the time of the sale to
    them. The underwriters will be obligated to purchase all of the
    securities of the series offered if any of the securities are
    purchased, unless otherwise specified in connection with any
    particular offering of securities. Any initial offering price
    and any discounts or concessions allowed, reallowed or paid to
    dealers may be changed from time to time.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may designate agents to sell the offered securities. Unless
    otherwise specified in connection with any particular offering
    of securities, the agents will agree to use their best efforts
    to solicit purchases for the period of their appointment. We may
    also sell the offered securities to one or more remarketing
    firms, acting as principals for their own accounts or as agents
    for us. These firms will remarket the offered securities upon
    purchasing them in accordance with a redemption or repayment
    pursuant to the terms of the offered securities. A prospectus
    supplement or pricing supplement, as the case may be will
    identify any remarketing firm and will describe the terms of its
    agreement, if any, with us and its compensation.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In connection with offerings made through underwriters or
    agents, we may enter into agreements with such underwriters or
    agents pursuant to which we receive our outstanding securities
    in consideration for the securities being offered to the public
    for cash. In connection with these arrangements, the
    underwriters or agents may also sell securities covered by this
    prospectus to hedge their positions in these outstanding
    securities, including in short sale transactions. If so, the
    underwriters or agents may use the securities received from us
    under these arrangements to close out any related open
    borrowings of securities.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Dealers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may sell the offered securities to dealers as principals. We
    may negotiate and pay dealers&#146; commissions, discounts or
    concessions for their services. The dealer may then resell such
    securities to the public either at varying prices to be
    determined by the dealer or at a fixed offering price agreed to
    with us at the time of resale. Dealers engaged by us may allow
    other dealers to participate in resales.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Direct
    Sales</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may choose to sell the offered securities directly. In this
    case, no underwriters or agents would be involved.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Institutional
    Purchasers</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may authorize agents, dealers or underwriters to solicit
    certain institutional investors to purchase offered securities
    on a delayed delivery basis pursuant to delayed delivery
    contracts providing for payment and delivery on a specified
    future date. The applicable prospectus supplement or pricing
    supplement, as the case may be will provide the details of any
    such arrangement, including the offering price and commissions
    payable on the solicitations.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will enter into such delayed contracts only with
    institutional purchasers that we approve. These institutions may
    include commercial and savings banks, insurance companies,
    pension funds, investment companies and educational and
    charitable institutions.
</DIV>
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    <BR>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Indemnification;
    Other Relationships</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We may have agreements with agents, underwriters, dealers and
    remarketing firms to indemnify them against certain civil
    liabilities, including liabilities under the Securities Act.
    Agents, underwriters, dealers and remarketing firms, and their
    affiliates, may engage in transactions with, or perform services
    for, us in the ordinary course of business. This includes
    commercial banking and investment banking transactions.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Market-Making,
    Stabilization and Other Transactions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    There is currently no market for any of the offered securities,
    other than the common stock and the 6.75% Series&#160;G
    Cumulative Redeemable Preferred Stock which are both listed on
    the NYSE. If the offered securities are traded after their
    initial issuance, they may trade at a discount from their
    initial offering price, depending upon prevailing interest
    rates, the market for similar securities and other factors.
    While it is possible that an underwriter could inform us that it
    intends to make a market in the offered securities, such
    underwriter would not be obligated to do so, and any such
    market-making could be discontinued at any time without notice.
    Therefore, no assurance can be given as to whether an active
    trading market will develop for the offered securities. We have
    no current plans for listing of the debt securities, preferred
    stock or warrants on any securities exchange or on the National
    Association of Securities Dealers, Inc. automated quotation
    system; any such listing with respect to any particular debt
    securities, preferred stock or warrants will be described in the
    applicable prospectus supplement or pricing supplement, as the
    case may be.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In connection with any offering of common stock, the
    underwriters may purchase and sell shares of common stock in the
    open market. These transactions may include short sales,
    syndicate covering transactions and stabilizing transactions.
    Short sales involve syndicate sales of common stock in excess of
    the number of shares to be purchased by the underwriters in the
    offering, which creates a syndicate short position.
    &#147;Covered&#148; short sales are sales of shares made in an
    amount up to the number of shares represented by the
    underwriters&#146; over-allotment option. In determining the
    source of shares to close out the covered syndicate short
    position, the underwriters will consider, among other things,
    the price of shares available for purchase in the open market as
    compared to the price at which they may purchase shares through
    the over-allotment option. Transactions to close out the covered
    syndicate short involve either purchases of the common stock in
    the open market after the distribution has been completed or the
    exercise of the over-allotment option. The underwriters may also
    make &#147;naked&#148; short sales of shares in excess of the
    over-allotment option. The underwriters must close out any naked
    short position by purchasing shares of common stock in the open
    market. A naked short position is more likely to be created if
    the underwriters are concerned that there may be downward
    pressure on the price of the shares in the open market after
    pricing that could adversely affect investors who purchase in
    the offering. Stabilizing transactions consist of bids for or
    purchases of shares in the open market while the offering is in
    progress for the purpose of pegging, fixing or maintaining the
    price of the securities.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In connection with any offering, the underwriters may also
    engage in penalty bids. Penalty bids permit the underwriters to
    reclaim a selling concession from a syndicate member when the
    securities originally sold by the syndicate member are purchased
    in a syndicate covering transaction to cover syndicate short
    positions. Stabilizing transactions, syndicate covering
    transactions and penalty bids may cause the price of the
    securities to be higher than it would be in the absence of the
    transactions. The underwriters may, if they commence these
    transactions, discontinue them at any time.
</DIV>

<DIV style="margin-top: 12pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">Fees and
    Commissions</FONT></B>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    In compliance with the guidelines of the Financial Industry
    Regulatory Authority (the &#147;FINRA&#148;), the aggregate
    maximum discount, commission or agency fees or other items
    constituting underwriting compensation to be received by any
    FINRA member or independent broker-dealer will not exceed 8% of
    any offering pursuant to this prospectus and any applicable
    prospectus supplement or pricing supplement, as the case may be;
    however, it is anticipated that the maximum commission or
    discount to be received in any particular offering of securities
    will be significantly less than this amount.
</DIV>
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    <BR>
    45
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    If more than 10% of the net proceeds of any offering of
    securities made under this prospectus will be received by FINRA
    members participating in the offering or affiliates or
    associated persons of such FINRA members, the offering will be
    conducted in accordance with FINRA Conduct Rule&#160;2710(h).
</DIV>

<A name='J82419128'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">LEGAL
    MATTERS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Unless otherwise indicated in the applicable prospectus
    supplement, DLA Piper LLP (US), Baltimore, Maryland will provide
    opinions regarding the authorization and validity of the
    securities and Skadden, Arps, Slate, Meagher&#160;&#038; Flom
    LLP, Chicago, Illinois, will provide opinions regarding certain
    tax matters. Any underwriters will also be advised about legal
    matters by their own counsel, which will be named in the
    prospectus supplement.
</DIV>

<A name='J82419129'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">EXPERTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The consolidated financial statements of UDR, Inc. appearing in
    UDR, Inc.&#146;s Annual Report
    <FONT style="white-space: nowrap">(Form&#160;10-K)</FONT>
    for the year ended December&#160;31, 2007 (including schedules
    appearing therein), and the effectiveness of UDR Inc.&#146;s
    internal control over financial reporting as of
    December&#160;31, 2007, have been audited by Ernst&#160;&#038;
    Young LLP, independent registered public accounting firm, as set
    forth in their reports thereon included therein, and
    incorporated herein by reference. Such financial statements are,
    and audited financial statements to be included in subsequently
    filed documents will be, incorporated herein in reliance upon
    the reports of Ernst&#160;&#038; Young LLP pertaining to such
    financial statements and the effectiveness of our internal
    control over financial reporting as of the respective dates (to
    the extent covered by consents filed with the Securities and
    Exchange Commission) given on the authority of such firm as
    experts in accounting and auditing.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The statement of revenues and certain expenses of One Island
    Square for the year ended December&#160;31, 2007, appearing in
    the
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    dated July&#160;7, 2008 (filed September&#160;22, 2008) of UDR,
    Inc. and incorporated by reference into this prospectus have
    been audited by Ehrhardt Keefe Steiner&#160;&#038; Hottman PC,
    an independent registered public accounting firm, as indicated
    in their reports with respect thereto, and are incorporated by
    reference into this prospectus in reliance upon the authority of
    said firm as experts in accounting and auditing.
</DIV>

<A name='J82419130'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">CAUTIONARY
    STATEMENT REGARDING FORWARD-LOOKING STATEMENTS</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    This prospectus, any accompanying prospectus supplements and the
    documents incorporated by reference contain forward-looking
    statements that involve risks and uncertainties, which are based
    on beliefs, expectations, estimates, projections, forecasts,
    plans, anticipations, targets, outlooks, initiatives, visions,
    objectives, strategies, opportunities, drivers and intents of
    our management. Such statements are made in reliance upon the
    safe harbor provisions of the Private Securities Litigation
    Reform Act of 1995. While we believe that our estimates and
    assumptions are reasonable, we caution that it is very difficult
    to predict the impact of known factors, and, of course,
    impossible for us to anticipate all factors that could affect
    our actual results. Our actual results may differ materially
    from those discussed in such forward-looking statements.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    Statements that are not historical facts, including statements
    about our beliefs and expectations, are forward-looking
    statements. Forward-looking statements can be identified by,
    among other things, the use of forward-looking language, such as
    &#147;believes,&#148; &#147;expects,&#148;
    &#147;estimates,&#148; &#147;projects,&#148;
    &#147;forecasts,&#148; &#147;plans,&#148;
    &#147;anticipates,&#148; &#147;targets,&#148;
    &#147;outlooks,&#148; &#147;initiatives,&#148;
    &#147;visions,&#148; &#147;objectives,&#148;
    &#147;strategies,&#148; &#147;opportunities,&#148;
    &#147;drivers,&#148; &#147;intends,&#148; &#147;scheduled
    to,&#148; &#147;seeks,&#148; &#147;may,&#148; &#147;will,&#148;
    or &#147;should&#148; or the negative of those terms, or other
    variations of those terms or comparable language, or by
    discussions of strategy, plans, targets, models or intentions.
    Forward-looking statements speak only as of the date they are
    made, and except for our ongoing obligations under the
    U.S.&#160;federal securities laws, we undertake no obligation to
    publicly update any forward-looking statements, whether as a
    result of new information, future events or otherwise. Such
    forward-looking statements include, without limitation,
    statements concerning property acquisitions and dispositions,
    development activity and capital expenditures, capital raising
    activities, rent growth, occupancy, and rental expense growth.
    In addition to factors that may be described in this prospectus,
    any accompanying prospectus supplement and the documents
    incorporated by reference, our determination not to, or
    difficulties, delays or unanticipated costs in or our inability
    to, including as a result of unanticipated adverse business
    developments affecting us, or our properties, adverse changes in
    the
</DIV>
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<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
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<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    real estate markets and general and local economies and business
    conditions, among others factors, could cause our actual results
    to differ materially from those expressed in any forward-looking
    statements made by us.
</DIV>

<A name='J82419131'>
<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <B><FONT style="font-family: 'Times New Roman', Times">WHERE YOU
    CAN FIND MORE INFORMATION</FONT></B>
</DIV>
</A>
<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We file annual, quarterly and current reports, proxy statements
    and other information with the SEC under the Exchange Act. You
    may inspect without charge any documents filed by us at the
    SEC&#146;s Public Reference Room at 100&#160;F&#160;Street,
    N.E., Room&#160;1580, Washington,&#160;D.C. 20549. You may
    obtain information on the operation of the Public Reference Room
    by calling the SEC at
    <FONT style="white-space: nowrap">1-800-SEC-0330.</FONT>
    The SEC also maintains an Internet site, <I>www.sec.gov</I>,
    that contains reports, proxy and information statements, and
    other information regarding issuers that file electronically
    with the SEC, including UDR.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    The SEC allows us to &#147;incorporate by reference&#148;
    information into this prospectus and any accompanying
    prospectus, which means that we can disclose important
    information to you by referring you to other documents filed
    separately with the SEC. The information incorporated by
    reference is considered part of this prospectus, and information
    filed with the SEC subsequent to this prospectus and prior to
    the termination of the particular offering referred to in such
    prospectus supplement will automatically be deemed to update and
    supersede this information. We incorporate by reference into
    this prospectus and any accompanying prospectus supplement the
    documents listed below (excluding any portions of such documents
    that have been &#147;furnished&#148; but not &#147;filed&#148;
    for purposes of the Exchange Act):
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<TABLE width="100%" border="0" cellpadding="0" cellspacing="0">

<TR>
    <TD width="4%"></TD>
    <TD width="2%"></TD>
    <TD width="94%"></TD>
</TR>

<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Annual Report on
    <FONT style="white-space: nowrap">Form&#160;10-K</FONT>
    for the year ended December&#160;31, 2007.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Quarterly Reports on
    <FONT style="white-space: nowrap">Form&#160;10-Q</FONT>
    for the quarters ended March&#160;31, 2008, June&#160;30, 2008
    and September&#160;30, 2008.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Current Reports on
    <FONT style="white-space: nowrap">Form&#160;8-K</FONT>
    and
    <FONT style="white-space: nowrap">Form&#160;8-K/A</FONT>
    filed with the SEC on January&#160;3, 2008, January&#160;29,
    2008, January&#160;30, 2008, February&#160;27, 2008;
    March&#160;7, 2008; March&#160;14, 2008; May&#160;2, 2008;
    June&#160;2, 2008; June&#160;11, 2008; July&#160;3, 2008;
    September&#160;5, 2008, September&#160;22, 2008, October&#160;1,
    2008, October&#160;3, 2008, November&#160;12, 2008 and
    December&#160;1, 2008.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    Our definitive Proxy Statement dated April&#160;15, 2008 and our
    definitive Additional Materials filed with the SEC on
    April&#160;15, 2008, both filed in connection with our Annual
    Meeting of Stockholders held on May&#160;30, 2008.
</TD>
</TR>


<TR style="line-height: 6pt; font-size: 1pt"><TD>&nbsp;</TD></TR>


<TR valign="top" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <TD>&nbsp;</TD>
    <TD>    &#149;&#160;
</TD>
    <TD align="left">
    The description of our capital stock contained in our
    Registration Statement on
    <FONT style="white-space: nowrap">Form&#160;8-A/A</FONT>
    dated and filed with the SEC on November&#160;7, 2005, including
    any amendments or reports filed with the SEC for the purpose of
    updating such description.
</TD>
</TR>

</TABLE>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We also incorporate by reference any future filings made with
    the SEC pursuant to Sections&#160;13(a), 13(c), 14 or 15(d) of
    the Exchange Act between the date of this prospectus and the
    date all of the securities offered hereby are sold or the
    offering is otherwise terminated, with the exception of any
    information furnished under Item&#160;2.02 and Item&#160;7.01 of
    <FONT style="white-space: nowrap">Form&#160;8-K,</FONT>
    which is not deemed filed and which is not incorporated by
    reference herein. Any such filings shall be deemed to be
    incorporated by reference and to be a part of this prospectus
    from the respective dates of filing of those documents.
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will provide without charge upon written or oral request to
    each person, including any beneficial owner, to whom a
    prospectus is delivered, a copy of any and all of the documents
    which are incorporated by reference into this prospectus but not
    delivered with this prospectus (other than exhibits unless such
    exhibits are specifically incorporated by reference in such
    documents).
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    47
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#J82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We will provide without charge to each person, including any
    beneficial owner, to whom this prospectus is delivered a copy of
    any of the documents referred to above by written or oral
    request to:
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

</DIV>

<DIV style="margin-top: 18pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; font-size: 10pt; font-family: Arial, Helvetica; color: #000000; background: transparent">

    <FONT style="font-family: 'Times New Roman', Times">UDR, Inc.<BR>
    1745 Shea Center Drive, Suite&#160;200<BR>
    Highlands Ranch, Colorado 80129<BR>
    Attention: Investor Relations<BR>
    Telephone:
    <FONT style="white-space: nowrap">(720)&#160;283-6120</FONT>
    </FONT>
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="left" style="margin-left: 0%; margin-right: 0%; text-indent: 4%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    We maintain a web site at www.udr.com. The reference to our web
    site does not constitute incorporation by reference of the
    information contained at the site and you should not consider it
    a part of this prospectus or any other document we file with or
    furnish to the SEC.
</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="center" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <BR>
    48
</DIV><!-- END PAGE WIDTH -->
<!-- PAGEBREAK -->
<P><HR noshade><P>
<H5 align="left" style="page-break-before:always"><A HREF="#D82419tocpage">Table of Contents</A></H5><P>

<DIV style="width: 87%; margin-left: 6%"><!-- BEGIN PAGE WIDTH -->
<!-- XBRL Pagebreak End -->

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <IMG src="d82419b5d8241900.gif" alt="(UDR LOGO)">
</DIV>

<DIV style="margin-top: 6pt; font-size: 1pt">&nbsp;</DIV>

<DIV align="center" style="margin-left: 0%; margin-right: 0%; text-indent: 0%; font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">
    <B><FONT style="font-size: 24pt">UDR, Inc.</FONT></B>
</DIV>

<DIV style="margin-top: 3pt; font-size: 1pt">&nbsp;</DIV>
<!-- XBRL Pagebreak Begin -->

<P align="left" style="font-size: 10pt; font-family: 'Times New Roman', Times; color: #000000; background: transparent">

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