Exhibit 3.(i)(a)
AMENDMENT NO. 1
TO THE
AMENDED AND RESTATED TRUST AGREEMENT
OF
CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY
This AMENDMENT NO. 1 dated as of May 8, 2000 ("Amendment No. 1") to the
Trust Agreement (as defined below) of Charter Municipal Mortgage Acceptance
Company, a Delaware business trust (the "Trust"), is entered into, by and among
the undersigned Trustees. Capitalized terms used but not defined shall have the
meaning assigned to such terms in Article 2 of the Trust Agreement.
W I T N E S S E T H :
WHEREAS, a business trust was created in accordance with applicable
provisions of the Trust Act by entering into a Trust Agreement, dated as of
August 12, 1996, as amended by Amendment No. 1 dated as of April 30, 1997 and as
further amended and restated by an Amended and Restated Trust Agreement dated
September 30, 1997 (the "Trust Agreement"), and by the filing with the Secretary
of State of the State of Delaware of a Certificate of Trust on August 12, 1996,
as heretofore amended; and
WHEREAS, the Trust Agreement permits the Board of Trustees, without the
consent of the Trust's Shareholders or the Registered Trustee, to (i) amend
Article 9 of the Trust Agreement, subject to the limitations and requirements
set forth in Section 10.4(e) of the Trust Agreement and (ii) reflect any rights,
preferences or privileges granted in connection with the issuance of a class or
series of Shares not outstanding as of September 30, 1997; and
WHEREAS, the Managing Trustees have adopted resolutions to amend the
Trust Agreement as provided herein to reflect (i) changes to Section 9.2(b) of
the Trust Agreement to revise certain allocation procedures for federal income
tax purposes and, in connection therewith, have (x) received the required tax
opinion and (y) provided the required notice to all Shareholders pursuant to
Section 10.4(e) of the Trust Agreement; and(ii) the rights, preferences and
privileges of Convertible Community Reinvestment Act Preferred Shares issued or
to be issued by the Trust; and
NOW, THEREFORE, the Trust Agreement is hereby amended as follows:
1. Effective as of April 1, 2000, Section 9.2(b) of the Trust
Agreement is hereby deleted and replaced in its entirety with the following:
(b) Capital Events. That portion of Distributions
attributable to a Capital Event and allocations of
Net Income and Net Loss from
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a Capital Event which is allocated to the
Shareholders shall be apportioned among the Persons
who were Shareholders of record on the last day of
the month during which the Trust received the
proceeds of such Capital Event in accordance with
their Percentage Interests based upon the number of
Shares owned by each such Shareholder on the last day
of such month without regard to Capital Accounts or
the number of days during such month in which a
Person was a Shareholder.
2. Effective as of May 10, 2000, a new Section 6.7 of the Trust
Agreement is hereby added to the Trust Agreement as follows:
6.7 Certificate of Designation. The Convertible Community
Reinvestment Act Preferred Shares of the Trust, shall have (i)
the designation, powers, preferences, (ii) the relative,
participating, optional or other special rights, and (iii) the
qualifications, limitations or restrictions, set forth in the
Certificate of Designation, attached hereto as Appendix A,
which terms are incorporated by reference in, and made a part
of, this Amendment No. 1 as if specifically set forth herein.
3. Except as otherwise amended herein, the Trust Agreement
remains unchanged and in full force and effect.
4. This Amendment No. 1 shall be interpreted in accordance with
the laws of the State of Delaware (without regard to conflict of laws
principles), all rights and remedies being governed by such laws.
5. This Amendment No. 1 may be executed in counterparts, each of
which shall be an original and all of which shall constitute one and the same
instrument.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have caused this Amendment
No. 1 to be executed as of the day and year first above written.
MANAGING TRUSTEES:
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx
/s/ Xxxxxx X. Xxxxxx
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Xxxxxx X. Xxxxxx
/s/ Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
/s/ Xxxxx X. Xxxxx
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Xxxxx X. Xxxxx
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
/s/ Xxxxxx X. Xxxxx
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Xxxxxx X. Xxxxx
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
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REGISTERED TRUSTEE:
WILMINGTON TRUST COMPANY,
(executing solely pursuant
to Section 3.2(iii) of the
Trust Agreement and not in
its individual capacity but
solely as Registered
Trustee)
By: /s/ Xxxxxx X. Xxxx
-----------------------
Name: Xxxxxx X. Xxxx
Title: Senior Financial
Services Officer
CONSENT OF MANAGER
------------------
The Manager of CharterMac hereby consents to the obligations imposed
upon it under Section 8 of the Certificate of Designation.
Related Charter L.P.
By: Related Charter LLC
By: /s/ Xxxx X. Xxxxxx
----------------------
Name: Xxxx X. Xxxxxx
Title: SVP
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Appendix A
----------
CERTIFICATE OF DESIGNATION
of
CONVERTIBLE COMMUNITY REINVESTMENT ACT PREFERRED SHARES
of
CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY
Pursuant to the Amended and Restated Trust Agreement of
Charter Municipal Mortgage Acceptance Company
dated September 30, 1997, as amended
CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY, a
Delaware business trust created and existing under the Delaware Business Trust
Act (the "Trust"),
DOES HEREBY CERTIFY:
That pursuant to the authority expressly vested in the board
of trustees of the Trust ("Board of Trustees") by the Amended and Restated Trust
Agreement of the Trust, dated September 30, 1997, as amended (the "Trust
Agreement"), the Board of Trustees duly adopted on May 8, 2000, resolutions
providing for the amendment of the Trust Agreement to create a class of
preferred shares, no par value, of the Trust, with (i) the designations, powers,
preferences, (ii) the relative, participating, optional or other special rights,
and (iii) the qualifications, limitations or restrictions, set forth below (in
addition to those set forth in the Trust Agreement):
1. DESIGNATION AND AMOUNT. The Shares of such class of
Preferred Shares shall be designated "Convertible Community Reinvestment Act
Preferred Shares" (the "CRA Preferred Shares") and the number of Shares
constituting such class shall be up to 1,946,000, as determined by one or more
of the Managing Trustees' execution of one or more attachments representing the
CRA Preferred Shares. The Trust may issue additional CRA Preferred Shares and
other securities which are on parity with the CRA Preferred Shares with respect
to allocations of CRA Credits (as defined below) ("Parity Securities").
2. DISTRIBUTIONS AND EARNINGS.
a. Distributions. Except as set forth in Section 2.b., the Trust
shall pay distributions on each CRA Preferred Share which are
the same as the distributions paid on each of the Trust's
Common Shares. The distributions shall be declared and paid
whenever distributions on the Common Shares are declared and
paid. The record date for payment of distributions on the CRA
Preferred Shares shall be the same date as for the Common
Shares.
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b. Initial Distribution. Notwithstanding the terms of Section
2.a., the initial distribution payable on the CRA Preferred
Shares shall be equal to the quarterly distribution then
payable on the Common Shares, prorated for the period from the
date of issuance of the CRA Preferred Shares through the
record date for such distribution.
c. Non-Cash Distributions. In the event the Trust (i) pays to all
holders of Common Shares distributions payable in Common
Shares or securities convertible into Common Shares, (ii)
issues to all holders of Common Shares of certain rights,
options or warrants entitling them to subscribe for or
purchase Common Shares at a price per share less than the fair
market value per Common Share, or (iii) distributes to all
holders of Common Shares evidences of indebtedness or assets
of the Trust, the CRA Preferred Shareholders shall receive for
each CRA Preferred Share held the same payment, issuance or
distribution payable with respect to each Common Share. For
example, in the case of clause (i), if holders of Common
Shares are entitled to receive two Common Shares for each
Common Share they hold, CRA Preferred Shareholders will
receive two Common Shares for each CRA Preferred Share they
hold. In connection with the foregoing payments, issuances or
distributions, the Board of Trustees, in its sole discretion,
shall take whatever actions it considers to be advisable in
order that holders of Common Shares and CRA Preferred
Shareholders are treated the same for federal income tax
purposes.
d. Earnings. For federal income tax purposes, the Board of
Trustees shall allocate to each CRA Preferred Share the same
earnings as it allocates to each of the Common Shares, subject
to the same proration for distributions set forth in Section
2.b.
3. LIQUIDATION, DISSOLUTION OR WINDING UP. The CRA
Preferred Shares shall rank (i) on a parity (pro rata based on the number of CRA
Preferred Shares, Common Shares and other equity securities outstanding which
rank in parity with respect to rights upon liquidation, dissolution or winding
up of the Trust) with the Common Shares and all other equity securities issued
by the Trust other than the equity securities referred to in clause (ii); and
(ii) junior to all equity securities issued by the Trust whose terms
specifically provide, other than with respect to allocations of CRA Credits,
that they rank senior to the CRA Preferred Shares. With respect to CRA
allocations, the CRA Preferred Shares will rank senior to the Common Shares. The
Trust may issue additional Parity Securities.
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4. VOTING RIGHTS.
a. General. Except as otherwise specifically provided herein, the
holders of CRA Preferred Shares ("CRA Preferred Shareholders")
shall not be entitled to vote.
b. Required Consent. The Trust shall not, without the affirmative
vote or consent of the holders of a majority of the
outstanding CRA Preferred Shares, amend, alter or repeal the
terms of the CRA Preferred Shares or any provisions of the
Trust's Trust Agreement that would adversely affect the
powers, preferences, privileges or rights of the CRA Preferred
Shares.
5. RIGHTS WITH RESPECT TO CRA CREDIT ALLOCATIONS.
a. General. Only CRA Preferred Shares (and Parity Securities)
shall be entitled to an allocation of CRA Credits. "CRA
Credits" are an allocation of the value of any assets owned
directly or indirectly by the Trust ("Investments") which a
CRA Preferred Shareholder may be able to report under the
"investment test" promulgated under the Community Reinvestment
Act of 1977, as amended from time to time (the "CRA"). Subject
to the terms of this Section 5, each CRA Preferred Share shall
be entitled to an allocation of CRA Credits equal to the
initial purchase price paid to the Trust for such CRA
Preferred Share. CRA allocations shall be undertaken upon each
issuance of CRA Preferred Shares (or Parity Securities) and
reallocations, if any, shall be undertaken at the end of each
quarter. For CRA Credit allocation purposes, Investments shall
be valued at their carrying value as of the Trust's most
recent calendar quarter.
b. Initial Allocations. Each CRA Preferred Shareholder shall
provide to the Trust a certification of its Self-Certified
Assessment Area. "Self-Certified Assessment Area" is the CRA
Preferred Shareholder's geographic self-certified assessment
area or broader statewide or regional area that includes a CRA
Preferred Shareholder's self-certified assessment area for
purposes of the CRA. Upon subscription for CRA Preferred
Shares, the Manager on behalf of the Trust shall notify the
CRA Preferred Shareholders of the CRA Credits allocated to
such Shareholders' CRA Preferred Shares based upon such
Shareholder's Self-Certified Assessment Area. To the extent
that upon the initial issuance of CRA Preferred Shares by the
Trust to a CRA Preferred Shareholder, such CRA Preferred
Shareholder is not allocated the amount of Investments it has
requested and is entitled to receive based on the initial
purchase price paid for its CRA Preferred Shares (an
"Unallocated Shareholder"), the Trust shall use its
commercially reasonable efforts to acquire Investments after
such issuance that satisfy such Unallocated Shareholders'
Self-Certified Assessment Area. An investor of CRA Preferred
Shares which is allocated the amount of Investments which it
has requested and is entitled to receive based on the initial
purchase
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price paid for its CRA Preferred Shares is referred to as a
"Fully Allocated Shareholder".
c. Replacement Allocations. CRA Credits shall not be reallocated
except as follows:
i. Prepayment, Repayment or Sale of Allocated Assets. If an
Investment comprising a CRA Credit allocated to a CRA Preferred
Shareholder is either repaid, prepaid, sold or foreclosed (a
"Terminated Allocation") within the first 24 months after such
Investment is first allocated to a CRA Preferred Shareholder ("Initial
24 Month Period"), then the Trust shall either reallocate a comparable
unallocated Investment to the CRA Preferred Shareholder or use its
commercially reasonable efforts to replace the Terminated Allocation
with a comparable Investment and have it reallocated to the CRA
Preferred Shareholder. However, if a Terminated Allocation occurs after
the Initial 24 Month Period, the Trust shall have no obligation to
replace the Terminated Allocation with a new Investment although such
CRA Preferred Shareholder may choose to receive a reallocation from
among any then existing but unallocated Investments, subject to the
allocation priorities set forth in Section 5.d.
ii. Reclassification Upon Transfer. If a Fully Allocated
Shareholder transfers its CRA Preferred Shares, the transferee shall
receive the same allocation of CRA Credits as the Fully Allocated
Shareholder had prior to transfer. If an Unallocated Shareholder
transfers its CRA Preferred Shares, the transferee shall receive (i)
the same allocation of CRA Credits as the Unallocated Shareholder had
prior to transfer, and (ii) the same priority that the Unallocated
Shareholder had prior to transfer with respect to allocations of CRA
Credits which the Unallocated Shareholder has properly requested from
the Trust but had not received prior to transfer. Subject to the
allocation priorities set forth in Section 5.d., a transferee shall
have a one-time option to obtain a different allocation of CRA Credits
based on any then existing but unallocated Investments.
iii. Permissive Reallocations; Sources of Unallocated CRA
Credits. The Trust, in its sole discretion, may allow a CRA Preferred
Shareholder to reallocate its CRA Credits to unallocated CRA Credits of
the Trust available from the sources set forth below, subject to the
allocation priorities set forth in Section 5.d. The sources of
unallocated CRA Credits shall be as follows:
A. Current Investments. Investments currently
held by the Trust which are unallocated to
any CRA Preferred Shareholders or holders of
any Parity Securities.
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B. New Investments. New Investments acquired
from time to time which are unallocated to
any CRA Preferred Shareholders or holders of
any Parity Securities.
C. Conversions to Common Shares. CRA Credits
allocated to CRA Preferred Shares that are
converted to Common Shares.
iv. Mechanics for Reallocation. The Manager shall adopt such
procedures as it deems necessary to implement the reallocation and/or
replacement allocation rights set forth in this Section 5.
d. Allocation Priorities. Unallocated CRA Credits shall be
allocated in accordance with the following priorities:
(i) first, to Unallocated Shareholders;
(ii) second, to CRA Preferred Shareholders with
Terminated Allocations within the Initial 24
Month Period;
(iii) third, to the transferee of CRA Preferred
Shares;
(iv) fourth, to CRA Preferred Shareholders with
Terminated Allocations subsequent to the
Initial 24 Month Period; and
(v) fifth, at the sole discretion of the Trust,
the balance to CRA Preferred Shareholders
who request reallocations of CRA Credits.
Within each category set forth above, the Trust shall determine the order in
which CRA Preferred Shareholders are entitled to receive allocations of CRA
Credits as follows:
A. for clause (i) above, priority shall be
based on the order in which CRA Preferred
Shareholders became Unallocated
Shareholders;
B. for clauses (ii) and (iv) above, priority
shall be based on the order in which a CRA
Preferred Shareholder suffers a Terminated
Allocation;
C. for clause (iii) above, priority shall be
based on the order in which CRA Preferred
Shares were transferred; and
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D. for clause (v) above, priority shall be
based on the order in which the request for
reallocation is actually received by the
Trust.
e. Allocations with respect to Subsequent Parity Security
Offerings. Shareholders who acquire Parity Securities in a
subsequent offering by the Trust shall have the same rights to
initial allocation and subsequent reallocation of unallocated
CRA Credits as the CRA Preferred Shareholders and other
holders of Parity Securities who purchased shares in prior
offerings, subject to the allocation priorities set forth in
Section 5.d.
6. CONVERSION.
a. Optional Right to Convert; Conversion Formula. CRA Preferred
Shares may be converted into Common Shares at the end of any
calendar quarter at the CRA Preferred Shareholder's option.
Each CRA Preferred Share shall be convertible into the number
of Common Shares or fraction of Common Shares obtained by
multiplying the number of CRA Preferred Shares being converted
by the following formula: $14.13 divided by the Conversion
Price. The "Conversion Price" shall be equal to $15.33 as
adjusted pursuant to the terms of Section 6(c).
b. Mechanics of Conversion; Fractional Shares.
i. Each CRA Preferred Shareholder who desires to convert its
CRA Preferred Shares into Common Shares shall provide notice to the
Trust in the form of the Notice of Conversion attached to this
Certificate of Designation (a "Conversion Notice") via telecopy, hand
delivery or other mail or messenger service. The original Conversion
Notice and the certificate or certificates representing the CRA
Preferred Shares for which conversion is elected, shall be delivered to
the Trust by nationally recognized courier, duly endorsed. The date
upon which a Conversion Notice is initially received by the Trust shall
be a "Notice Date."
The Trust shall use all reasonable efforts to issue and
deliver within three (3) business days after the Notice Date, to such
CRA Preferred Shareholder at the address of the holder on the books of
the Trust, a certificate or certificates for the number of Common
Shares to which the holder shall be entitled as set forth herein;
provided that the original certificates representing the CRA Preferred
Shares to be converted are received by the transfer agent or the Trust
within three business days after the Notice Date and the Person or
Persons entitled to receive the Common Shares issuable upon such
conversion shall be treated for all purposes as the record holder or
holders of such Common Shares on such date such original certificates
are received. If the original certificates representing the CRA
Preferred Shareholder to be converted are not received by the transfer
agent or the Trust within three business days after the Notice Date,
the Conversion Notice shall become null and void.
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ii. If the Conversion Formula results in a CRA Preferred
Shareholder being entitled to receive a fractional Common Share with
respect to the aggregate CRA Preferred Shares being converted pursuant
to a Conversion Notice, in lieu of the issuance of such fractional
Common Share, the Trust shall pay to the CRA Preferred Shareholder cash
in an amount equal to the Conversion Price multiplied by the fraction
representing the fractional share.
c. Adjustment to Conversion Price.
i. If, prior to the conversion of all CRA Preferred Shares,
the number of issued and outstanding Common Shares is increased by a
share split or other similar event, the Conversion Price shall be
proportionately reduced, or if the number of issued and outstanding
Common Shares is decreased by a combination or reclassification of
Common Shares or other similar event, the Conversion Price shall be
proportionately increased.
ii. If, prior to the conversion of all CRA Preferred Shares,
the Trust shall be a party to any transaction (including, without
limitation, a merger, consolidation, tender offer of all or
substantially all of the shares or sale of all or substantially all of
the Trust's assets), as a result of which Common Shares shall be
converted into the right to receive securities or other property
(including cash or any combination thereof), each CRA Preferred Share,
if convertible after the consummation of the transaction, shall
thereafter be convertible into the kind and amount of shares and other
securities and property (including cash or any combination thereof)
receivable upon the consummation of such transaction by a holder of
that number of Common Shares or fraction thereof into which one CRA
Preferred Share was convertible immediately prior to such transaction,
assuming such CRA Preferred Shareholder failed to exercise any rights
of election to convert (provided that if the kind and amount of stock
or beneficial interest, securities and other property so receivable is
not the same for each non-electing share, the kind and amount so
receivable by each non-electing share shall be deemed to be the kind
and amount received per share by a plurality of non-election shares).
The Trust may not become a party to any such transaction unless the
terms thereof are consistent with the foregoing.
d. Effect of Conversion on Allocation of CRA Credits. Upon
conversion, CRA Preferred Shareholders shall no longer be
entitled to retain the allocation of CRA Credits allocated to
the CRA Preferred Shares that were converted to Common Shares.
Such CRA Credits shall be allocated to other CRA Preferred
Shareholders pursuant to Section 5.
e. Reservation of Common Shares Issuable Upon Conversion. The
Trust shall at all times reserve and keep available out of its
authorized but unissued Common Shares, solely for the purpose
of effecting the conversion of the CRA
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Preferred Shares, such number of its Common Shares as shall
from time to time be sufficient to effect the conversion of
all then outstanding CRA Preferred Shares; and if at any time
the number of authorized but unissued Common Shares shall not
be sufficient to effect the conversion of all then outstanding
CRA Preferred Shares, will take such action as may be
necessary to increase its authorized but unissued Common
Shares to such number of Common Shares as shall be sufficient
for such purposes.
7. CRA REPORTING. The Trust shall provide to CRA
Preferred Shareholders the following reports:
(a) an initial report within thirty days of the issuance of
CRA Preferred Shares which shall set forth specific information regarding the
Investment comprising the CRA Credits allocated to each CRA Preferred
Shareholder which shall include the name and address of the property underlying
such Investment (the "Underlying Property") and the carrying value of such
Investment; and
(b) quarterly reports within forty-five days after the end of
each calendar quarter which shall set forth specific information regarding the
Investment comprising the CRA Credits allocated to each CRA Preferred
Shareholder which shall include the name and address of the Underlying Property,
the carrying value of such Investment, data concerning the community served by
the Underlying Property, including tenant income limitations, and a brief
description of the Underlying Property's development status (i.e., under
construction, leasing, or stabilized occupancy).
8. CRA AUDITING ASSISTANCE. The Trust and Manager on
behalf of the Trust, shall provide technical support and documentation to assist
CRA Preferred Shareholders in preparing for CRA audits and shall attend audit
meetings if requested. In the event that such support and documentation is
requested, the CRA Preferred Shareholder making the request shall be required to
pay all of the Trust's out-of-pocket expenses associated with such assistance.
The Manager shall adopt such procedures and rules as it deems necessary in
providing the assistance contemplated in this Section 8.
9. TRANSFER RESTRICTIONS.
a. Legend. The CRA Preferred Shares shall be subject to the
restrictions on transfer and each CRA Preferred Share
certificate will contain a legend substantially to the
following effect:
THE CRA PREFERRED SHARES REPRESENTED HEREBY HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), OR ANY STATE SECURITIES LAWS OR ANY OTHER APPLICABLE
SECURITIES LAWS AND THE
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ISSUER HAS NOT BEEN REGISTERED UNDER THE INVESTMENT COMPANY ACT OF
1940, AS AMENDED (THE "INVESTMENT COMPANY ACT"). NEITHER SUCH CRA
PREFERRED SHARES NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE
REOFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR
OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS
SUCH TRANSACTION IS EXEMPT FROM SUCH REGISTRATION. CRA PREFERRED SHARES
WILL BE ISSUED AND MAY BE TRANSFERRED ONLY IN WHOLE SHARES.
A CRA PREFERRED SHAREHOLDER MAY NOT TRANSFER LESS THAN 200,000
CRA PREFERRED SHARES, OR, IN THE EVENT THAT SUCH CRA PREFERRED
SHAREHOLDER WAS PERMITTED TO PURCHASE AND DID PURCHASE LESS THAN
200,000 CRA PREFERRED SHARES, THE NUMBER OF CRA PREFERRED SHARES SO
PURCHASED. UNLESS A TRANSFEROR HAS TRANSFERRED ALL OF ITS CRA PREFERRED
SHARES, IT MUST RETAIN NO LESS THAN 200,000 CRA PREFERRED SHARES OR THE
AMOUNT OF CRA PREFERRED SHARES INITIALLY ACQUIRED.
THE HOLDER BY ITS ACCEPTANCE HEREOF AGREES TO OFFER, SELL OR
OTHERWISE TRANSFER THE CRA PREFERRED SHARES REPRESENTED HEREBY, PRIOR
TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE ORIGINAL ISSUANCE
DATE HEREOF AND THE LAST DATE ON WHICH THE ISSUER OR ANY "AFFILIATE" OF
THE ISSUER WAS THE OWNER OF SUCH CRA PREFERRED SHARES (OR ANY
PREDECESSOR HEREOF), ONLY IN A TRANSFER (A) TO THE ISSUER OR AN INITIAL
PURCHASER OR BY, THROUGH, OR IN A TRANSACTION APPROVED BY AN INITIAL
PURCHASER, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) SO LONG AS THE CRA
PREFERRED SHARES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 144A, TO A
PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A) THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE
ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER AND TO WHOM NOTICE IS GIVEN
THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (D) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2),
(3) OR (7) UNDER THE SECURITIES ACT) THAT IS ACQUIRING SUCH CRA
PREFERRED SHARES FOR ITS OWN ACCOUNT OR AS FIDUCIARY OR AGENT FOR
OTHERS (EACH OF WHICH MUST BE SUCH AN INSTITUTIONAL ACCREDITED INVESTOR
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UNLESS THE PURCHASER IS A BANK ACTING IN ITS FIDUCIARY CAPACITY) FOR
INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR SALE IN
CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT OR
(E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.
ANY TRANSFER IN VIOLATION OF THE FOREGOING WILL BE OF NO FORCE
AND EFFECT, WILL TO THE FULLEST EXTENT PERMITTED BY LAW BE VOID AB
INITIO, AND WILL NOT OPERATE TO TRANSFER ANY RIGHTS TO THE TRANSFEREE,
NOTWITHSTANDING ANY INSTRUCTION TO THE CONTRARY TO THE ISSUER, THE
TRANSFER AGENT OR ANY INTERMEDIARY.
b. Minimum Transfer Amounts. A CRA Preferred Shareholder may not
transfer less than (i) 200,000 CRA Preferred Shares, or, (ii)
in the event that at the Manager's discretion a CRA Preferred
Shareholder was permitted to purchase and did purchase less
than 200,000 CRA Preferred Shares, the number of CRA Preferred
Shares so purchased. In all events, however, if a transferor
has not transferred all of its CRA Preferred Shares, it must
retain no less than 200,000 CRA Preferred Shares or the amount
of CRA Preferred Shares initially acquired.
10. CAPITALIZED TERMS. Capitalized terms used herein and
not otherwise defined are used as defined in the Trust Agreement.
11. SECTION REFERENCES. Unless otherwise stated herein,
references to sections shall be deemed to be references to sections of this
Certificate of Designation.
12. GOVERNING LAW. This Certificate of Designation shall
be interpreted in accordance with the terms of the State of Delaware (without
regard to conflict of laws principles), all rights and remedies being governed
by such laws.
13. CERTIFICATES. Certificates representing CRA Preferred
Shares shall include a statement that requires the Trust to furnish to any CRA
Preferred Shareholder, upon written request and without charge, a full statement
of the designations and any preferences, conversion and other rights, voting
powers, restrictions, limitations as to distributions and other qualifications
and terms and conditions of redemption of such CRA Preferred and the differences
in the relative rights and preferences between the CRA Preferred Shares to the
extent that they have been set and the authority of the Board of Trustees to set
the relative rights and preferences of subsequent series of the same class of
Shares. Notwithstanding any other provision of the Trust Agreement or the
Amended and Restated Bylaws of the Trust (the "Trust Bylaws") to the contrary, a
certificate representing CRA Preferred Shares shall be
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validly issued upon the manual signature of any one or more Managing Trustee.
Such a certificate need not be countersigned and registered by the Trust's
transfer agent and/or registrar. The Managing Trustees, acting individually or
collectively, shall execute and deliver certificates representing the CRA
Preferred Shares substantially in the form attached hereto as Exhibit A and
incorporated herein by reference, together with such modifications thereto as
such Managing Trustee or Managing Trustees shall approve (notwithstanding any
other provision of the Trust Agreement or Amended and Restated Bylaws of the
Trust but subject to the requirements set forth in this Certificate of
Designation), such approval to be conclusively, but not exclusively, evidenced
by the execution and delivery thereof by such Managing Trustee or Managing
Trustees. To the extent that this Section 13 is inconsistent with the Trust
Bylaws, in accordance with Article XIV of the Trust Bylaws, the Trust Bylaws,
including Article VII of the Trust Bylaws, shall be deemed amended for the
limited purposes set forth in this Section 13.
915782.7
A-11
ANNEX TO CERTIFICATE OF DESIGNATION
-----------------------------------
NOTICE OF CONVERSION
--------------------
To: Charter Municipal Mortgage Acceptance Company
Reference is made to that certain Certificate of Designation of
Convertible Community Reinvestment Act Preferred Shares of Charter Municipal
Mortgage Acceptance Company (the "CRA Designation"). Capitalized terms used but
not defined herein shall have the meanings set forth in the CRA Designation.
Pursuant to the CRA Designation, the undersigned, being a holder of CRA
Preferred Shares (an "Exercising Holder"), hereby elects to exercise its
conversion rights as to a portion or portions of its CRA Preferred Shares, all
as specified opposite its signature below:
Dated:
----------------------------
NUMBER OF CRA
PREFERRED SHARES
TO BE CONVERTED TO
EXERCISING HOLDER COMMON SHARES
----------------- -------------
Name Signature
---- ---------
------------------- ------------------- -------------
915782.7
A-12
