CHAPTER 484

An Act to amend the Code of Virginia by adding in Title 6 a chapter
mumbered 18, and containing sections numbered 6-577 through 6-585,
providing for the formation of real estate investment trusts, provid-
ang a method for registering such trusts, and amendments thereto,
and providing how actions against such trusts may be mn eS

26]
Approved March 31, 1962

Be it enacted by the General Assembly of Virginia:
. That the Code of Virginia be amended by adding in Title 6 a chapter
iumbered 18, and containing sections numbered 6-577 through 6-585, as

ollows:
Chapter 13

§ 6-577. This Chapter may be referred to as the “Virginia Real Es-
ate Investment Trust Act”’.

§ 6-578. As used in this chapter the term:

(1) “real estate investment trust” or “trust” means a trust created
inder this chapter (a) for the primary purpose of acquiring ownership
r co-ownership of one or more of the following: (i) land or improvements
hereon and the development and management thereof, (ii) obligations
ecured by deeds of trust, mortgages or other lien instruments on real es-
ate, (ili) personal property, whether or not constituting fixtures, inciden-
al to the operation of real estate in which the trust has an interest, and
iv) leases of and other limited interests in real estate, and (b) which
rovides in the declaration of trust that the property and business of the
rust shall be held and managed by trustees who are residents of Virginia
nd for the issuance of transferable certificates of interest.
__ (2) “certificate of interest’ or “certificates of interest” means a cer-
tificate or certificates issued by a trust evidencing a beneficial interest
erein.
(3) “trustees’’ means the trustees of real estate investment trust.
8 6-579. (1) Two or more individuals may form a trust by execut-
ing and acknowledging a declaration of trust which shall set forth:
is) The name of the trust, which shall include the words “real estate

(b) The character of the business to be conducted.

(c) The location of its principal office.

(d) The name and residence address of each of the initial trustees.

(e) The terms, conditions and limitations under which certificates of
interest may be issued by the trustees.

(f) The powers and duties of the trustees and the rights of the hold-
ers of certificates of interest.

_ (g) The tenure of office of the trustees and the method of determin-
ing succession.

(h) The duration of the trust, or a statement that the duration of the
trust is unlimited.

(i) Any other provisions not inconsistent with law which may be
deemed desirable.

(2) The declaration of trust so executed and acknowledged shall be
filed for record in the office of the clerk of the court in which deeds to
real ,catate are recorded, located where the principal office of the trust is
ocated.

(8) The clerk with whom the declaration of trust is filed for record
shall keep a book in which all such declarations of trusts and all amend-
ments and supplements thereto shall be recorded showing the date of filing
and shall keep an index in which shall be entered in alphabetical order the
name of the trust and the names of each of the trustees.

§ 6-580. All amendments of and supplements to the declaration of
trust shall be in writing and shall be executed, acknowledged and filed for
record as provided with respect to the declaration of trust.

§ 6-581. The principal office of the trust shall be located in Virginia.
If the principal office of the trust is changed a certificate showing such
change shall be executed and acknowledged by one or more trustees and
filed for record in the place where the declaration of trust was last filed for
record, and the declaration of trust as amended and supplemented shall be
filed for record in the office of the clerk of the court in which deeds to real
estate are recorded, located where the principal office of the trust has been
moved. If any change is made in the personnel of the trustees a certificate
showing such change shall be executed and acknowledged by one or more
trustees and filed for record in the office where the declaration of trust was
last filed for record.

§ 6-582. Certificates of interest may be issued by the trustees from
time to time for such consideration as they may deem desirable, subject to
any limitation contained in the declaration of trust. Each holder of a bene-
ficial interest in the trust shall be entitled to a certificate of interest. No
certificate of interest shall be issued that is not fully paid and nonassess-

e.

§ 6-583. (1) The declaration of trust may provide that the right of
acquisition, management and disposition of property of the trust and the
conduct of its business and to appoint or elect successor trustees shall be
vested exclusively in the trustees and that in the conduct of the affairs of
the trust, pursuant to the provisions of the declaration of trust, and in the
annointment or election of trustees, the holders of certificates of interest
shall have a limited or no vote.

(2) The declaration of trust may provide that any number of trustees,
not less than two, may exercise any or all rights of the trustees, that prop-
erty of the trust may be held in the name of the trust, and that any con-
tract, deed, deed of trust, mortgage or other document executed in the
name of the trust by any two trustees shall be effective and binding on the
trust.

§ 6-584. (1) Creditors of the trust and others having claims against
the trust shall be entitled to seek recovery only out of the assets of the
trust, and the trustees and holders of certificates of interest shall not be
liable to such creditors or other claimants.

(2) The declaration of trust may provide that the trustees shall not
be liable to the trust or to the holders of certificates of interest except for
negligence or misconduct and that the trust will indemify each of the
trustees against expenses incurred by him in defending any claim arising
out of his trusteeship except claims as to which he shall be finally adjudged
to be liable for negligence or misconduct.

6-585. The duration of a trust may be unlimited and a trust shall
not be deemed to violate any rule against perpetuities or accumulations or
to unlawfully suspend the power of alienation.