SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES AND EXCHANGE ACT
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Charter Municipal Mortgage Acceptance Company
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CHARTER MUNICIPAL MORTGAGE
ACCEPTANCE COMPANY
----------------------
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
ON
JUNE 11, 2002
----------------------
April 30, 2002
To the holders of common shares of beneficial interest in Charter Municipal
Mortgage Acceptance Company:
NOTICE IS HEREBY GIVEN THAT the 2002 Annual Meeting of Charter Municipal
Mortgage Acceptance Company ("CharterMac") will be held on Tuesday, June 11,
2002 at 10:00 A.M. (local time) at the law offices of Paul Hastings Janofsky &
Walker, 75 East 55th Street, New York, New York for the following purposes:
(1) The election of three (3) trustees to the Board of Trustees of
CharterMac (the "Board of Trustees") each for a term of three years to
expire in 2005.
(2) The approval of an amendment to CharterMac's Amended and Restated
Trust Agreement to increase the number of authorized shares from
50,000,000 to 100,000,000.
(3) The transaction of such other business as may properly come before the
meeting or any adjournment or postponement thereof.
The Board of Trustees unanimously recommends a vote "FOR" each of the
listed proposals. The accompanying proxy statement contains additional
information and should be carefully reviewed by the holders of common shares of
beneficial interest in CharterMac.
You can vote your common shares of beneficial interest by Internet or phone
by following the instructions on the enclosed proxy card. If you prefer to vote
by regular mail, please sign, date and return the enclosed proxy card in the
enclosed return envelope as soon as possible.
The Board of Trustees has fixed the close of business on April 16, 2002 as
the record date for the determination of the holders of common shares of
beneficial interest in CharterMac entitled to notice of, and to vote at, the
meeting and any adjournment or postponement thereof.
By Order of the Board of Trustees
/s/ Stuart J. Boesky
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Stuart J. Boesky
President and Chief Executive Officer
IT IS MOST IMPORTANT THAT YOU VOTE YOUR COMMON SHARES OF BENEFICIAL
INTEREST EITHER BY INTERNET, PHONE OR MAIL. IF YOU DECIDE TO DO SO BY MAIL,
PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED PROXY CARD.
YOUR FAILURE TO PROMPTLY VOTE YOUR SHARES INCREASES THE OPERATING COSTS OF
YOUR INVESTMENT.
YOU ARE CORDIALLY INVITED TO PERSONALLY ATTEND THE MEETING, BUT YOU SHOULD
VOTE BY PHONE, INTERNET OR MAIL WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY 625 MADISON AVENUE NEW YORK, NEW
YORK, 10022
CHARTER MUNICIPAL ACCEPTANCE COMPANY
625 MADISON AVENUE
NEW YORK, NEW YORK, 10022
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS
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INTRODUCTION
The accompanying form of proxy is solicited on behalf of the Board of
Trustees (the "Board of Trustees", each individual managing trustee serving
thereon, a "Trustee") of Charter Municipal Mortgage Acceptance Company
("CharterMac" or the "Company") for use at the Annual Meeting of Shareholders of
CharterMac (the "Meeting") to be held on Tuesday, June 11, 2002 at 10:00 A.M.
(local time) at the law offices of Paul Hastings Janofsky & Walker, 75 East 55th
Street, New York, New York and at any adjournment or postponement thereof.
CharterMac has first mailed these proxy materials to holders of common shares of
beneficial interest in CharterMac (the "Common Shares") on or about May 1, 2002.
CharterMac's executive offices are located at 625 Madison Avenue, New York, New
York 10022 (telephone: (212) 588-1765). Holders of Common Shares of record at
the close of business on April 16, 2002 (the "Record Date") are entitled to vote
at the Meeting or any adjournment or postponement thereof.
As was the case last year, holders of Common Shares may vote their shares
by telephone or on the Internet. If you wish to vote your Common Shares by
telephone or the Internet, follow the instructions on the attached proxy card.
Common Shares represented by properly executed proxy cards, Internet votes
or telephone votes received by CharterMac at or prior to the Meeting will be
voted according to the instructions indicated on the proxy card. If no choice
has been specified and the enclosed proxy card is properly executed and
returned, the Common Shares so represented will be voted "FOR" each of the
listed trustees and "FOR" the proposal to increase the number of authorized
Shares.
Proxies may be revoked by those persons executing proxies at any time
before the authority granted thereby is exercised by delivering to CharterMac's
secretary at or prior to the Meeting a written notice of revocation bearing a
later date than the date of the proxy, duly executing a subsequently dated proxy
with respect to the same Common Shares represented by the proxy and delivering
it to CharterMac's secretary at or before the Meeting or attending the Meeting
and voting in person, although attendance at the Meeting will not, by itself,
constitute revocation. Any written notice revoking a proxy should be delivered
at or prior to the Meeting to the attention of the secretary, Charter Municipal
Mortgage Acceptance Company, 625 Madison Avenue, New York, New York 10022.
The Board of Trustees unanimously recommends a vote "FOR" each of the
listed proposals.
As of April 16, 2002, approximately 41,152,738 Common Shares were
outstanding with each share entitled to one vote on all matters that may
properly come before the Meeting. Also as of such date, 1,882,364 nonvoting
Convertible Community Reinvestment Act Preferred Shares (the "CRA Preferred
Shares"), which are convertible into 1,764,663 voting Common Shares, were
outstanding.
MANAGEMENT
TRUSTEES AND OFFICERS
The Board of Trustees directs the management of the business of CharterMac,
but retains Charter Mac Corporation ("CM Corp."), its wholly owned subsidiary,
and Related Charter, LP ("RCLP") to manage the Company's day-to-day affairs. CM
Corp. and RCLP provide CharterMac services pursuant to management agreements
between (i) CM Corp. and CharterMac and (ii) RCLP and CharterMac. Collectively,
they are referred to as the "Manager". The Board of Trustees has delegated
certain responsibilities to the Manager including, among other things,
overseeing the Company's portfolio of assets and acquiring and disposing of
investments. During 2001, the Board of Trustees held fifteen meetings, the
compensation committee did not hold any meetings and the audit committee held
four meetings. The average attendance in the aggregate of the total number of
Board and committee meetings was 80%.
The Trustees and Executive Officers of CharterMac are as follows:
YEAR FIRST BECAME
NAME AGE OFFICE HELD OFFICER/TRUSTEE TERM EXPIRES
---- --- ----------- --------------- ------------
Stephen M. Ross. . . . . . . . . . . . 61 Managing Trustee, 1999 2003
Chairman of the Board
Stuart J. Boesky. . . . . . . . . . . 44 Managing Trustee, President, 1997 2003
and Chief Executive Officer
Alan P. Hirmes. . . . . . . . . . . . 47 Managing Trustee, Executive 1997 2002
Vice President, Secretary
Peter T. Allen. . . . . . . . . . . . 56 Managing Trustee 1997 2004
Arthur P. Fisch . . . . . . . . . . . 60 Managing Trustee 1997 2004
Charles L. Edson. . . . . . . . . . . 67 Managing Trustee 2001 2002
Michael J. Brenner. . . . . . . . . . 56 Managing Trustee 2000 2004
Thomas W. White . . . . . . . . . . . 64 Managing Trustee 2000 2002
Michael I. Wirth. . . . . . . . . . . 43 Chief Financial Officer 2000 --
and Chief Accounting Officer
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Biographical information with respect to Messrs. Edson, Hirmes and White is
set forth under "PROPOSALS BEFORE THE MEETING", below.
STEPHEN M. ROSS is Chairman of the Board of Trustees of CharterMac and is a
Member of the sole general partner of the Manager. Mr. Ross is the founder,
Chairman, CEO and Managing General Partner of the Related Companies, L.P.
("TRCLP") Mr. Ross began his career working for the accounting firm of Coopers &
Lybrand in Detroit as a tax attorney. Later, he moved to New York where he
worked for two large Wall Street investment banking firms in their real estate
and corporate finance departments before founding TRCLP in 1972. Mr. Ross
graduated from the University of Michigan School of Business Administration with
a Bachelor of Science degree and from Wayne State School of Law with a Juris
Doctor degree. He then received a Master of Law degree in Taxation from New York
University School of Law. Mr. Ross endowed the Stephen M. Ross Professor of Real
Estate at the University of Michigan. Mr. Ross is also on the Board of Directors
of Insignia Financial Group, Inc.
STUART J. BOESKY is a Managing Trustee, the President and Chief Executive
Officer of CharterMac and the President, Chief Executive Officer and Member of
the sole general partner of the Manager. Mr. Boesky is also a Partner and Senior
Managing Director of Related Capital Company ("Related Capital"), the financial
services arm of TRCLP, where he is primarily responsible for the creation,
design and implementation of Related Capital's debt and equity finance programs.
Prior to joining Related Capital in 1986, Mr. Boesky practiced real estate and
tax law with the law firm of Shipley & Rothstein and the Boston office of
Stroock and Stroock and Lavan. Previously, Mr. Boesky was a consultant at the
accounting firm of Laventhol & Horwath. Mr. Boesky received a Bachelor of Arts
degree with high honors from Michigan State University, a Juris Doctor degree
from Wayne State University School of Law and a Master of Law degree in Taxation
from Boston University School of Law. Mr. Boesky also serves on the Board of
Directors of Aegis Realty, Inc. ("Aegis") and the Board of Trustees of American
Mortgage Acceptance Company ("AMAC"), both of which are managed by affiliates of
RCLP.
PETER T. ALLEN is a Managing Trustee of CharterMac and is President of
Peter Allen & Associates, Inc., a real estate development and management firm,
in which capacity he has been responsible for the leasing, refinancing and
development of major commercial properties. Mr. Allen has also been an Adjunct
Professor of the Graduate School of Business at the University of Michigan since
1981. Mr. Allen received a Bachelor of Arts Degree in history/economics from
DePauw University and a Masters Degree in Business Administration with
Distinction from the University of Michigan. Mr. Allen has been an Independent
Trustee since 1997 and is a member of the Audit and Compensation Committees. Mr.
Allen also serves on the Board of Directors of Aegis and on the Board of
Trustees of AMAC.
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ARTHUR P. FISCH is a Managing Trustee of CharterMac and is an attorney in
private practice specializing in real property and securities law since October
1987, with Arthur P. Fisch, P.C. and Fisch & Kaufman. From 1975-1987, Mr. Fisch
was employed by E.F. Hutton & Company, serving as First Vice President in the
Direct Investment Department from 1981-1987 and associate general counsel from
1975-1980 in the legal department. As First Vice President, he was responsible
for the syndication and acquisition of residential real estate. Mr. Fisch
received a B.B.A. from Bernard Baruch College of the City University of New York
and a Juris Doctor degree from New York Law School. Mr. Fisch is admitted to
practice law in New York and Pennsylvania. Mr. Fisch has been an Independent
Trustee since 1997 and is a member of the Audit and Compensation Committees. Mr.
Fisch also serves on the Board of Directors of Aegis and the Board of Trustees
of AMAC.
MICHAEL J. BRENNER is a Managing Trustee of CharterMac, and is the
Executive Vice President and Chief Financial Officer of TRCLP. Prior to joining
TRCLP in 1996, Mr. Brenner was a partner with Coopers & Lybrand, having served
as managing partner of its Industry Programs and Client Satisfaction initiatives
from 1993-1996, managing partner of the Detroit group of offices from 1986-1993
and Chairman of its National Real Estate Industry Group from 1984-1986. Mr.
Brenner graduated summa cum laude from the University of Detroit with a
Bachelors degree in Business Administration and from the University of Michigan
with a Masters of Business Administration, with distinction. Mr. Brenner also
serves on the Board of Directors of Aegis.
MICHAEL I. WIRTH is the Chief Financial Officer and Chief Accounting
Officer of CharterMac and is a Senior Vice President and Chief Financial Officer
of the general partner of the Manager. Mr. Wirth is also a Senior Vice President
of Related Capital. Mr. Wirth joined Related Capital in August, 2000. Prior to
Related Capital, Mr. Wirth was a Vice President in the Real Estate Group at CGA
Investment Management where he was responsible for the underwriting, investment
and management of all commercial real estate debt investments made by the
company. Prior to CGA, Mr. Wirth spent 4 years as a senior manager at Deloitte &
Touche in the Realty Consulting Group and Technology Solutions practice and 5
years as a senior manager and national director to the financial services
industry at The Roulac Group of Deloitte & Touche. Mr. Wirth received a
Bachelors in Business Administration from Georgia State University. He has been
a Certified Public Accountant since 1986.
COMMITTEES OF THE BOARD OF TRUSTEES
The Board of Trustees has standing Audit and Compensation Committees. The
Audit Committee's duties include the review and oversight of all transactions
with affiliates of CharterMac, the periodic review of CharterMac's financial
statements and meetings with CharterMac's independent auditors. The Audit
Committee is comprised of Messrs. Allen, Fisch and Edson, each of whom is
"independent" under the rules of the American Stock Exchange and had four
meetings during CharterMac's fiscal year ended December 31, 2001.
The Compensation Committee's duties include the determination of
compensation, if any, of CharterMac's executive officers and of the Manager and
the administration of CharterMac's Incentive Share Option Plan (the "Share
Option Plan"). The Compensation Committee is comprised of Messrs. Allen and
Fisch and did not hold any meetings during CharterMac's fiscal year ended
December 31, 2001. The Compensation Committee must have at least two members,
each of which must be Independent Trustees.
3
RELATED CHARTER, LP
The directors and executive officers of Related Charter LLC ("Related
Charter"), the sole general partner of RCLP, are set forth below. These officers
of the sole general partner of RCLP may also provide services to CharterMac on
behalf of RCLP. The executive officers of RCLP are the exact same as the
executive officers of CM Corp.
YEAR FIRST BECAME
NAME AGE OFFICES HELD OFFICER/MEMBER
---- --- ------------ --------------
Stuart J. Boesky. . . . . . . . . . . . . . . . . 44 Member, President and 1997
Chief Executive Officer
Alan P. Hirmes. . . . . . . . . . . . . . . . . . 47 Member, Senior Vice President 1997
Stephen M. Ross . . . . . . . . . . . . . . . . . 61 Member 1997
Michael I. Wirth. . . . . . . . . . . . . . . . . 43 Senior Vice President and 2000
Chief Financial Officer
James D. Spound . . . . . . . . . . . . . . . . . 41 Executive Vice President 1998
Denise L. Kiley . . . . . . . . . . . . . . . . . 42 Senior Vice President 1997
Marc D. Schnitzer . . . . . . . . . . . . . . . . 41 Senior Vice President 1997
John J. Sorel . . . . . . . . . . . . . . . . . . 41 Senior Vice President 1999
Steven B. Wendel. . . . . . . . . . . . . . . . . 39 Senior Vice President 2001
Mark J. Schlacter . . . . . . . . . . . . . . . . 51 Vice President 1997
Max E. Schlopy. . . . . . . . . . . . . . . . . . 65 Vice President 1998
Gary Parkinson. . . . . . . . . . . . . . . . . . 52 Controller 2000
Teresa Wicelinski . . . . . . . . . . . . . . . . 36 Secretary 1998
---------------
Biographical information with respect to Messrs. Boesky, Ross, and Wirth is
set forth above. Biographical information with respect with Mr. Hirmes is set
forth under "PROPOSALS BEFORE THE MEETING", below.
JAMES D. SPOUND is an Executive Vice President of Related Charter with
primary responsibility for bond originations. He joined Related Capital from
First Union Capital Markets, in February 1998, where he was a Vice President
specializing in affordable housing finance. From 1992 to 1996, Mr. Spound served
as an investment banker in the Housing Finance Department at Merrill Lynch &
Co., where he was a Vice President at the time of his departure. Previously, Mr.
Spound was also a Senior Consultant at Kenneth Leventhal & Company where he
focused on debt restructurings in the real estate industry. In addition, he
served for three years as a Project Manager at New York City's Economic
Development Corporation where he was responsible for underwriting and
administering incentive loans to support the City's economic development goals.
Mr. Spound received a Bachelor of Arts degree from Brown University and a
Masters of Science in Management from the Sloan School at MIT.
DENISE L. KILEY is a Senior Vice President of Related Charter. Ms. Kiley is
also a Partner and a Managing Director of Related Capital where she is
responsible for the underwriting and asset management groups. Ms. Kiley oversees
the investment underwriting and approval of all multifamily residential
properties invested in Related Capital sponsored corporate, public and private
equity and debt funds. Prior to joining Related Capital in 1990, Ms. Kiley had
experience acquiring, financing and managing the assets of multifamily
residential properties. From 1981 through 1985 she was an auditor with a
national accounting firm. Ms. Kiley holds a Bachelor of Science degree in
Accounting from Boston College and is a Member of the Affordable Housing
Roundtable.
MARC D. SCHNITZER is a Senior Vice President of Related Charter. Mr.
Schnitzer is also a Partner and a Managing Director of Related Capital where he
is responsible for the Tax Credit Acquisitions and Corporate Funds Groups. Mr.
Schnitzer received a Master of Business Administration degree from The Wharton
School of The University of Pennsylvania in December 1987, and joined Related
Capital in January, 1988. From 1983 to 1986, Mr. Schnitzer was a Financial
Analyst in the Fixed Income Research Department of The First Boston Corporation
in New York. Mr. Schnitzer received a Bachelor of Science degree, summa cum
laude, in Business Administration from the School of Management at Boston
University.
4
JOHN SOREL is a Senior Vice President of Related Charter and is a Senior
Vice President of Related Capital. Mr. Sorel is responsible for overseeing
construction risk management and loan servicing for CharterMac. Prior to joining
Related Capital in November, 1999, Mr. Sorel was a Vice President for BankBoston
in their real estate department from 1993-1999, where he originated and managed
over $150 million of corporate and construction loan facilities for the low
income housing tax credit industry. From 1991-1993, Mr. Sorel worked as an
Assistant Vice President for Recoll Management. Mr. Sorel holds a Bachelor of
Arts degree in Economics from Syracuse University.
STEVEN B. WENDEL is a Senior Vice President of Related Charter and a Senior
Vice President of Related Capital, focusing on taxable mortgage financing for
multifamily properties. Prior to joining Related Capital in June, 1999, Mr.
Wendel was a Managing Director of the commercial loan origination and
securitization program at ContiFinancial Corporation, which originated
approximately $2.6 billion of commercial loans. From 1989-1992, Mr. Wendel was a
senior associate of the structured finance/MBA rotational program at Coopers &
Lybrand. From 1987-1989, he was a consultant at Martin E. Segal Company, and
from 1984-1987, he was a pricing analyst at Metropolitan Life Insurance Company.
Mr. Wendel received his Bachelor of Arts in economics from the University of
Pennsylvania and his Masters in Business Administration from the Stern School of
Business Administration at New York University.
MARK J. SCHLACTER is a Vice President of Related Charter. Mr. Schlacter is
a Vice President of Related Capital and has been with Related Capital since June
1989. Mr. Schlacter is primarily responsible for the origination and acquisition
of taxable mortgage products. Prior to joining Related Capital, Mr. Schlacter
garnered 16 years of direct real estate experience covering retail and
residential construction, single and multifamily mortgage origination and
servicing, commercial mortgage origination and servicing, property acquisition
and financing, and mortgage lending program underwriting and development. He was
a Vice President with Bankers Trust Company from 1986 to June 1989, and held
prior positions with Citibank, Anchor Savings Bank and the Pyramid Companies
covering the 1972-1986 period. Mr. Schlacter holds a Bachelor of Arts degree in
Political Science from Pennsylvania State University.
MAX E. SCHLOPY is a Vice President of Related Charter. An attorney, Mr.
Schlopy practiced corporate and commercial real estate law in Buffalo, New York
for many years, where he was a partner with the law firm of Duke, Holzman,
Yeager and Schlopy. He served as Vice President - General Counsel for Marc
Equity Corporation, a diversified real estate development company with
operations in several states and later as a Vice President of the general
partner for the Summit Tax Exempt Bond Funds. More recently, Mr. Schlopy was
President of MK Industries, Inc., an Orlando, Florida-based company involved in
the research and development of high technology military and biomedical products
and processes. He presently practices law and offers consulting services to the
real estate industry from his offices in Park City, Utah. Mr. Schlopy was
educated at Cornell and San Francisco State Universities, and received his Juris
Doctor degree, cum laude, from the School of Law, State University of New York
at Buffalo.
GARY PARKINSON is the Controller of Related Charter. Mr. Parkinson has been
a Certified Public Accountant in New York since 1987. Prior to joining Related
Capital in September 2000, Mr. Parkinson was employed by American Real Estate
Partners, L.P. from July 1991 to September 2000, Integrated Resources, Inc. from
August 1988 to July 1991 and Ernst & Young from September 1984 to August 1988.
Mr. Parkinson graduated from Northeastern University and The Johnson Graduate
School of Business at Cornell University.
TERESA WICELINSKI is the Secretary of Related Charter. Ms. Wicelinski
joined Related Capital in June 1992, and prior to that date was employed by
Friedman, Alprin & Green, certified public accountants. Ms. Wicelinski graduated
from Pace University with a Bachelor of Arts Degree in Accounting.
5
PW FUNDING, INC.
On December 24, 2001, CM Corp. acquired approximately 80% of the
outstanding capital stock of PW Funding, Inc. ("PW Funding"), a mortgage banking
firm specializing in multifamily housing.
PW Funding was founded in 1971 and became one of the original Fannie Mae
Delegated Underwriting and Servicing ("DUS") lenders in 1988. In 2000, PW
Funding acquired Larson Financial Resources, Inc. ("Larson Financial
Resources"), one of the top Freddie Mac Program Plus Seller/Servicers in the
Northeast and a leading commercial loan correspondent for life insurance
companies. Together, PW Funding and Larson Financial Resources service a $3
billion loan portfolio and over the past five years, have averaged approximately
$530 million annually in loan originations.
As a result of the acquisition, the Company has diversified the range of
its investment products and is now able to offer developers fixed and floating
rate tax-exempt and taxable financing through Fannie Mae, Freddie Mac and, to a
lesser extent, FHA for affordable and market rate multifamily properties.
Combining this with the Company's core business of investing in tax-exempt
revenue bonds and the Company's affiliation with Related Capital, the Company is
able to provide developers with financing for all aspects of their property's
capital structure. In addition, the Company now has a fee business that will
grow in value over time, which will generate internal revenue growth. The
Company believes this internal revenue growth will help to insulate it from the
vagaries of the capital markets.
PW Funding will continue to operate under its current management, the
executive officers of which are listed below:
YEAR FIRST BECAME
NAME AGE OFFICE HELD OFFICER/TRUSTEE
---- --- ----------- ---------------
Stuart J. Boesky. . . . . . . . . . . . 44 Chairman 2001
Raymond J. Reisert, Jr. . . . . . . . . 60 Chief Executive Officer 1991
T. Michael Forney . . . . . . . . . . . 60 President 2001
William T. Hyman. . . . . . . . . . . . 44 Executive Vice President 1991
Sharon S. Fierstein . . . . . . . . . . 43 Executive Vice President & Treasurer 1993
Larry N. Volk . . . . . . . . . . . . . 54 Executive Vice President & Secretary 1993
Katherine B. Schnur . . . . . . . . . . 39 Executive Vice President 2001
Peter J. Reisert. . . . . . . . . . . . 31 Senior Vice President 1997
-----------------
Biographical information with respect to Mr. Boesky is listed in the
"Trustees and Officers" section above.
RAYMOND J. REISERT, JR. is the Chief Executive Officer of PWF, a member of
the Board of Directors and serves on the PWF Loan Committee. He is also actively
involved in the company's strategic and financial planning and PWF's working
relationships with Fannie Mae and Freddie Mac. Mr. Reisert started PWF as an FHA
Lender and directed its entry into the Fannie Mae Delegated Underwriting and
Servicing Product Line ("DUS") as one of the original lenders in that program.
During his tenure, PWF acquired Larson Financial Resources, a major Freddie Mac
Program Plus and Insurance Company Correspondent. Prior to joining PWF, Mr.
Reisert was a Managing Director in PaineWebber's Municipal Securities Group.
Prior to joining PaineWebber, Mr. Reisert was Vice President of Finance and
Treasurer of United Health Services. Mr. Reisert started his career at Coopers &
Lybrand in the Consulting Division where he specialized in economic feasibility
and financial planning studies. Mr. Reisert received a Bachelors in Business
Administration from Iona College and a Masters in Business Administration from
New York University. Mr. Reisert is a member of the Executive Board of American
Seniors Housing Association, the National Multifamily Housing Council, The DUS
Lenders' Advisory Council and the Mortgage Bankers Association of America
("MBAA"). Mr. Reisert also serves on the MBAA's Commercial Board of Governors
and is the current chair of the Multifamily Steering Committee. Mr. Reisert is
the father of Peter Reisert.
6
T. MICHAEL FORNEY is President of PWF and a member of the Board of
Directors. He is responsible for the overall direction and day-to-day management
of PWF and its subsidiary organizations, LFR and Cambridge Healthcare Funding
Inc. Mr. Forney began his commercial mortgage banking career at LFR in 1985
after serving for 18 years as a Manager and Senior Executive with AT&T. Mr.
Forney was the Chief Operating Officer at LFR. After the sale of LFR to PWF in
October 2000, Mr. Forney retained his duties as Chief Operating Officer and
directed the transition and consolidation of the companies. He was named
President of PW Funding in January 2001. Mr. Forney is currently a member of the
Mortgage Bankers Association of America's Commercial/Multifamily Board of
Governors and chairs the board's nominating committee. Mr. Forney is a former
chairman of the MBA Multifamily Steering Committee and a founding member of the
Association's Certified Mortgage Banking Commission. Mr. Forney is one of only
120 commercial/multifamily members in the country to earn the Certified Mortgage
Banker (CMB) designation. Mr. Forney graduated from Eastern Washington
University with a Bachelor's Degree in Political Science.
WILLIAM T. HYMAN was named Executive Vice President of Underwriting and
National Origination at PWF in 2001. Mr. Hyman has been with PWF since 1989 and
was PWF's Chief Underwriter from 1993 until he was named Chief Operating Officer
in 2000. During his tenure as Chief Underwriter, Mr. Hyman was responsible for
the approval of mortgage loans totaling in excess of $800 million. Mr. Hyman was
also responsible for the management of the Firm's multifamily loan processing
and underwriting activities. In 1993, he was appointed Chief Underwriter for the
Fannie Mae Delegated Underwriting and Servicing Program. In addition to his
Fannie Mae responsibilities, Mr. Hyman developed the underwriting standards and
procedures for the Firm's Conduit Program. Prior to joining PWF, Mr. Hyman was a
Vice President with L.F. Rothschild & Co.'s corporate finance department. Prior
to that, Mr. Hyman was with PaineWebber Incorporated as an associate in the
municipal finance healthcare group. Mr. Hyman holds a Bachelor of Arts degree
with a major in architecture from Yale University and a Masters degree in
business administration from Washington University in St. Louis. Mr. Hyman
served on the Fannie Mae DUS Business Model Task Force in 2000 and currently
serves on the DUS Advisory Council Subcommittee for Product Development.
SHARON S. FIERSTEIN is Executive Vice President, Corporate Treasurer and
Chief Financial Officer at PWF. Mrs. Fierstein joined PWF in early 1993 and, as
Chief Financial Officer, is responsible for directing the accounting and
financial management activities of the Firm. She is responsible for negotiating
credit lines and letters of credit for financings under the FHA, Fannie Mae,
Freddie Mac, Ginnie Mae and Conduit programs. She manages the Firm's working
capital position and the Firm's investment of its own and its clients' funds.
Prior to joining PWF, Mrs. Fierstein worked for Metropolitan Life Insurance
Company for three years and was an audit manager at Deloitte & Touche before
that. She became a certified public accountant in 1984. Mrs. Fierstein is a
magna cum laude graduate of Wesleyan University (1981) and received an MBA from
New York University in 1985.
LARRY N. VOLK is Executive Vice President, General Counsel and Corporate
Secretary of PWF and Assistant to the President. Mr. Volk has been with PWF
since early 1993 and served in his current capacity since early 2001. Mr. Volk
has been actively engaged in commercial mortgage finance since 1981. Mr. Volk
served on both the business side and as general counsel for various New York
State agencies during the 1980's. Prior to joining PWF, Mr. Volk spent three
years in Washington, D.C. serving the U.S. Department of Housing and Urban
Development in the office of the Assistant Secretary for Housing-Federal Housing
Commissioner. He was also a founding partner of a Washington-based investment
banking firm, and then Policy and Program Director for the trade association of
state housing finance agencies. Mr. Volk is a graduate of Clarkson College of
Technology, was valedictorian of his class at Albany Law School, and holds an
MBA from Rensselaer Polytechnic Institute
KATHERINE B. SCHNUR is Executive Vice President of operations for PWF. She
is responsible for servicing, closing, personnel and administrative and
information management functions for PWF and its subsidiaries. Ms. Schnur joined
LFR's servicing department in June 1988. In January 1992, Ms. Schnur was
promoted to the position of Vice President, Loan Administration. In 1994, Ms.
Schnur became the Vice President, Loan Closing and Underwriting and was promoted
to Senior Vice President in August, 1995. In January 1997, Ms. Schnur helped
create the Specialty Finance Department. In April 2001, Ms. Schnur was promoted
to Chief Operating Officer. Prior to joining LFR, she was a manager in the
Corporate Sales Division with Blue Cross/Blue Shield of New Jersey where she had
responsibility for computer software and managing the sales support staff. Ms.
Schnur has been an active member of both the New Jersey Mortgage Bankers
Association and the Mortgage Bankers Association of America, and has chaired or
vice-chaired a number of committees. She was chosen to
7
participate in the MBA of America's inaugural class of Future Leaders in 1997.
She is past president and Board member of Children on the Green in Morristown,
NJ. Ms. Schnur holds a Bachelor of Arts in Psychology and Economics from
Lafayette College.
PETER J. REISERT is Senior Vice President of Capital Markets, New Product
Development, and Corporate Marketing and Advertising of PWF. Mr. Reisert
coordinates PWF's new product development with CharterMac, The Related
Companies, Fannie Mae and Freddie Mac. He also runs PWF's pricing and trading
desk where he is responsible for the trading of securities including mortgages
(Fannie Mae DUS/MBS, FHA Whole Loans and Ginnie Mae securities), discount notes
and US Treasuries. During his tenure, Mr. Reisert formalized trading and pricing
procedures and developed relationships with numerous institutional investors.
Mr. Reisert is a current member of the PWF loan committee. Mr. Reisert served on
PWF's Board of Directors prior to its sale to CharterMac in 2001. Prior to
joining PWF, Mr. Reisert was employed by Arbor National Mortgage where he worked
on the mortgage-trading desk in a variety of roles. He earned a Bachelor of Arts
degree from Providence College and a Masters degree in business administration
from Hofstra University. In 2002, Mr. Reisert was chosen to participate in the
Mortgage Banker's Association of America's Future Leader's leadership program.
Mr. Reisert is the son of Raymond Reisert.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
CharterMac has and will continue to have certain relationships with RCLP
and its affiliates. However, there have been no direct financial transactions
between CharterMac and its Trustees and officers or the members and officers of
the sole general partner of RCLP.
AFFILIATED BORROWERS
CharterMac has invested in, and may in the future invest in, Revenue Bonds
secured by properties in which either direct or indirect affiliates of Related
Capital own equity interests in the borrower. The Trust Agreement contains a
limitation, equal to 15% of CharterMac's total market value, on the aggregate
amount of Revenue Bonds CharterMac may hold where the borrowers under such
Revenue Bonds are either direct or indirect affiliates of Related Capital and
Related Capital generally has a controlling economic interest ("15%
Affiliates"). The Trust Agreement also requires that CharterMac obtain a
fairness opinion from an independent adviser before investing under any
circumstance in Revenue Bonds involving 15% Affiliates. For purposes of the
foregoing limitations, a borrower in which Related Capital or its affiliates own
a partnership or joint venture interest merely to facilitate an equity financing
on behalf of one of Related Capital's investment funds is not deemed a 15%
Affiliate under the Trust Agreement by virtue of such relationship ("Non-15%
Affiliate" and, together with the 15% Affiliates, the "RCC Affiliates"). A
typical Non-15% Affiliate borrower would be structured as a limited partnership
as follows: the general partner would be an unaffiliated third party with a 1%
general partnership interest and the 99% limited partner would itself be a
limited partnership in which an affiliate of Related Capital would own a 1%
general partnership interest and one or more Fortune 500 companies would own a
99% limited partnership interest.
Every transaction entered into between CharterMac and an RCC Affiliate
raises a potentially ongoing inherent conflict of interest. In addition to the
initial determination to invest in Revenue Bonds secured by properties owned by
an RCC Affiliate, such conflicts of interest with respect to these Revenue Bonds
include, among others, decisions regarding (i) whether to waive defaults of such
RCC Affiliate, (ii) whether to foreclose on a loan, and (iii) whether to permit
additional financing on a property securing a CharterMac investment other than
financing provided by CharterMac. Although not required by the Trust Agreement,
the Board of Trustees has adopted a policy to address certain of such conflicts,
requiring the approval of a majority of the independent trustees in the event
that CharterMac is required to take any of the following actions with respect to
a Revenue Bond secured by a property in which an RCC Affiliate of the Manager
owns an equity interest: (i) modification of any material rights and obligations
respecting the RCC Affiliate, (ii) CharterMac's waiver of material rights under
the affiliated loan documents, (iii) the advancement of a material amount of
additional funds to an affiliate borrower and (iv) forbearing to exercise any of
CharterMac's rights or collect any material costs due to us from an affiliate
borrower.
8
INDEMNIFICATION RIGHTS WITH RESPECT TO CREDIT ENHANCEMENT TRANSACTIONS
On December 31, 2001, CharterMac completed a credit enhancement transaction
with Merrill Lynch Capital Services, Inc. ("MLCS") pursuant to which CM Corp.
initially will receive an annual fee of approximately $1.2 million in return for
assuming MLCS's $46.9 million first loss position on a $351.9 million pool of
tax-exempt weekly variable rate multifamily mortgage loans originated by
CreditRe Mortgage Capital, LLC, an affiliate of Credit Suisse First Boston and
TRCLP. TRCLP has provided CM Corp. with an indemnity covering 50% of any losses
that are incurred by CM Corp. as part of this transaction. As the loans mature
or prepay, the first loss exposure and the fees paid to CM Corp. will both be
reduced. The latest maturity date on any loan in the portfolio occurs in 2009.
Fannie Mae and Freddie Mac have assumed the remainder of the real estate
exposure after the $46.9 million first loss position. In connection with the
transaction, CharterMac has guaranteed the obligations of CM Corp., and as a
security therefore, has posted collateral, initially in an amount equal to 50%
of the first loss amount, which may be reduced to 40% if certain post closing
conditions are met. TRCLP is an affiliate of Related Capital.
CM Corp. performed due diligence on each property in the pool, including an
examination of loan-to-value and debt service coverage both on a current and
"stressed" basis. CM Corp. analyzed the portfolio on a "stressed" basis by
increasing capitalization rates and assuming an increase in the low floater bond
rate. As of December 31, 2001, the credit enhanced pool of properties are
performing according to their contractual obligations and the Company does not
anticipate any losses to be incurred on its guaranty.
MANAGEMENT AGREEMENTS
CM Corp. and RCLP provide CharterMac services pursuant to management
agreements between (i) CM Corp. and CharterMac and (ii) RCLP and CharterMac.
Collectively, CM Corp. and RCLP are referred to as the "Manager". Pursuant to
these agreements, the Manager is obligated to use its best efforts to seek out
and present to CharterMac, whether through its own efforts or those of third
parties retained by it, suitable and a sufficient number of investment
opportunities which are consistent with the investment policies and objectives
of CharterMac and consistent with such investment programs as the Board of
Trustees may adopt from time to time in conformity with CharterMac's Trust
Agreement.
Although the Board of Trustees has continuing exclusive authority over the
management of CharterMac, the conduct of its affairs and the management and
disposition of CharterMac's assets, the Board of Trustees has initially
delegated to the Manager, subject to the supervision and review of the Board of
Trustees and consistent with the provisions of the Trust Agreement, the power
and duty to: (i) manage the day-to-day operations of CharterMac; (ii) acquire,
retain or sell CharterMac's assets; (iii) seek out, present and recommend
investment opportunities consistent with CharterMac's investment policies and
objectives, and negotiate on behalf of CharterMac with respect to potential
investments or the dispositions thereof; (iv) when appropriate, cause an
affiliate to serve as the mortgagee of record for mortgage investments of
CharterMac and in that capacity hold escrow on behalf of mortgagors in
connection with the servicing of mortgages; (v) obtain for CharterMac such
services as may be required in acquiring and disposing of investments,
disbursing and collecting the funds of CharterMac, paying the debts and
fulfilling the obligations of CharterMac, and handling, prosecuting and settling
any claims of CharterMac, including foreclosing and otherwise enforcing
mortgages and other liens securing investments; (vi) obtain for CharterMac such
services as may be required for property management, mortgage brokerage and
servicing, and other activities relating to the investment portfolio of
CharterMac; (vii) evaluate, structure and negotiate prepayments or sales of
CharterMac's mortgage investments and mortgage securities; (viii) monitor
operations and expenses of CharterMac; and (ix) from time to time, or as
requested by the Board of Trustees, make reports to CharterMac as to its
performance of the foregoing services.
The terms of each of the management agreements is one year. Both of the
management agreements may be renewed, subject to evaluation of the performance
of the Manager by CharterMac's Board of Trustees. Both agreements may be
terminated (i) without cause by the Manager; or (ii) for cause by a majority of
CharterMac's Board of Trustees, in each case without penalty and each upon 60
days prior written notice to the non-terminating party.
The Manager is entitled to subcontract its obligations under the Management
Agreements to an affiliate. In accordance with the foregoing, the Manager has
assigned its rights and obligations to Related Capital.
9
Pursuant to the terms of the Management Agreement, the Manager is entitled
to receive the fees and other compensation set forth below:
FEE/COMPENSATION* AMOUNT
----------------- ------
Bond Selection Fee . . . . . . . . . . . 2.00% of the face amount of each asset invested in or acquired
by CharterMac or its subsidiaries.
Special Distributions/Investment
Management Fee . . . . . . . . . . . . . 0.375% per annum of the total invested assets of CharterMac or
its subsidiaries.
Loan Servicing Fee . . . . . . . . . . . 0.25% per annum based on the outstanding face amount of
revenue bonds and other investments owned by CharterMac or
its subsidiaries.
Operating Expense Reimbursement. . . . . For direct expenses incurred by the Manager in an amount not to
exceed $556,331 per annum (subject to increase based on
increases in CharterMac's and its subsidiaries'assets and to
annual increases based upon increases in the Consumer Price
Index).
Incentive Share Options. . . . . . . . . The Manager may receive options to acquire additional Common
Shares pursuant to the Share Option Plan only if CharterMac's
distributions in any year exceed $0.9517 per Common Share and
the Compensation Committee of the Board of Trustees determines
to grant such options.
Liquidation Fee. . . . . . . . . . . . . 1.50% of the gross sales price of the assets sold by CharterMac
in connection with a liquidation of CharterMac assets
supervised by the Manager.
-----------------
* The Manager is also permitted to earn miscellaneous compensation which may
include, without limitation, construction fees, escrow interest, property
management fees, leasing commissions and insurance brokerage fees. The
payment of any such compensation is generally limited to the competitive
rate for the services being performed. A bond placement fee of 1.0% to 1.5%
of the face amount of each asset invested in or acquired by CharterMac or
its subsidiaries is payable to the Manager by the borrower, and not by
CharterMac or its subsidiaries.
Affiliates of the Manager may provide certain financial guarantees to
facilitate leveraging by CharterMac, for which they could be paid market rate
fees. In addition, affiliates of the Manager may provide certain financial
guarantees to the owner (or partners of the owners) of the underlying properties
securing CharterMac's revenue bonds, for which they could be paid market rate
fees.
The Manager may engage in other business activities related to real estate,
mortgage investments or other investments whether similar or dissimilar to those
made by CharterMac, or act as manager to any other person or entity having
investment policies whether similar or dissimilar to those of CharterMac. Before
the Manager, the officers and directors of the Manager and all persons
controlled by the Manager and its officers and directors may take advantage of
an opportunity for their own account or present or recommend it to others, they
are obligated to present such investment opportunity to CharterMac if (i) such
opportunity is of a character which could be taken by CharterMac, (ii) such
opportunity is compatible with CharterMac's investment objectives and policies
and (iii) CharterMac has the financial resources to take advantage of such
opportunity.
The Trust Agreement and Management Agreement provide that CharterMac will
indemnify the Manager and its affiliates under certain circumstances.
RCLP has been designated the "Tax Matters Partner" to manage administrative
tax proceedings conducted at CharterMac's level by the IRS with respect to
company matters. RCLP will also serve as the general partner of CharterMac for
tax purposes.
10
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of April 16, 2002, no person was known by CharterMac to be the
beneficial owner of more than 5% of the outstanding Common Shares of CharterMac.
As of April 16, 2002, the members of the sole general partner of the
Manager own, in the aggregate, 100% of the voting stock of the sole general
partner of the Manager.
As of April 16, 2002, Trustees and senior officers of CharterMac and
members and senior officers of the sole general partner of the Manager own
directly or beneficially Common Shares of CharterMac as follows:
AMOUNT AND NATURE OF
NAME TITLE BENEFICIAL OWNERSHIP PERCENT OF CLASS10
---- ----- -------------------- ------------------
Stephen M. Ross. . . . . . . Chairman of the Board of 246,454 Common Shares 1 2 3 *
CharterMac and Member
of Related Charter
Alan P. Hirmes . . . . . . . Managing Trustee, Executive 58,232 Common Shares 1 3 4 *
VP and Secretary, of
CharterMac and Member and
Senior VP of Related Charter
Stuart J. Boesky . . . . . . Managing Trustee, President 66,188 Common Shares 1 3 4 *
and CEO of CharterMac and
Member, President and CEO
of Related Charter
Peter T. Allen . . . . . . . Managing Trustee of CharterMac 3,053 Common Shares *
Arthur P. Fisch. . . . . . . Managing Trustee of CharterMac 3,053 Common Shares *
Thomas W. White. . . . . . . Managing Trustee of CharterMac 972 Common Shares *
Charles L. Edson . . . . . . Managing Trustee of CharterMac 305 Common Shares *
Michael J. Brenner . . . . . Managing Trustee of CharterMac 13,605 Common Shares 5 *
Michael I. Wirth . . . . . . CFO & CAO of CharterMac and 10,319 Common Shares 6 *
SVP & CFO of Related Charter
James D. Spound. . . . . . . Executive VP of Related Charter 27,210 Common Shares 7 *
Marc D. Schnitzer. . . . . . Senior VP of Related Charter 13,628 Common Shares 4 *
Denise L. Kiley. . . . . . . Senior VP of Related Charter 13,628 Common Shares 4 *
John J. Sorel. . . . . . . . Senior VP of Related Charter 1,667 Common Shares 8 *
Steven B. Wendel . . . . . . Senior VP of Related Charter 0 Common Shares *
All Senior Officers and Trustees of CharterMac
and Related Charter as a group (14 persons) 415,978 Common Shares 1 3 9 1.13%
-----------------
* Less than 1% of the outstanding Common Shares.
1 11 of these Common Shares are owned by the Manager, of which a majority is
owned by Messrs. Ross, Hirmes, and Boesky.
2 Includes 8,702 options to purchase Common Shares (which are exercisable
within 60 days)
3 21,157 of these Common Shares are owned by Related AMI Associates, Inc., of
which a majority is owned by Messrs. Ross, Hirmes and Boesky .
4 Includes 6,961 options to purchase Common Shares (which are exercisable
within 60 days)
5 Includes 13,605 options to purchase Common Shares (which are exercisable
within 60 days)
6 Includes 4,752 options to purchase Common Shares (which are exercisable
within 60 days)
7 Includes 27,210 options to purchase Common Shares (which are exercisable
within 60 days)
11
8 Includes 1,667 options to purchase Common Shares (which are exercisable
within 60 days)
9 Includes 83,780 options to purchase Common Shares (which are exercisable
within 60 days)
10 Based on the Common Shares outstanding as of March 7, 2002 (34,827,738)
plus the Common Shares issuable upon the conversion of (i) all options to
purchase Common Shares which are exercisable within 60 days (83,780) and
(ii) all CRA Preferred Shares (1,764,663).
COMPLIANCE WITH SECTION 16(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended, requires
CharterMac's officers and trustees, and persons who own more than 10% of a
registered class of CharterMac's equity securities, to file reports of ownership
and changes in ownership with the Securities and Exchange Commission (the
"Commission"). These persons are required by regulation of the Commission to
furnish CharterMac with copies of all Section 16(a) forms they file.
CharterMac believes that during the fiscal year ended December 31, 2001,
CharterMac's officers, trustees and greater than 10% beneficial owners complied
with all applicable Section 16(a) filing requirements, except for a Form 4
required to be filed by Marc Schnitzer after he exercised his option to purchase
6,667 Common Shares. A Form 5 has been filed with the SEC to reflect this
purchase.
PROPOSALS BEFORE THE MEETING
PROPOSAL #1: ELECTION OF TRUSTEES
The Board of Trustees is divided into three classes, currently consisting
of two classes of three Trustees each and one class of two Trustees. At the
Meeting, three Trustees are to be elected for three- year terms expiring in
2005. All of the nominees are currently Trustees of CharterMac. Trustees are
elected by a plurality of the votes cast (assuming the presence of a quorum
consisting of a majority of the holders of Common Shares present either in
person or by proxy).
Unless holders of Common Shares otherwise specify, the Common Shares
represented by the proxies will be voted "FOR" the indicated nominees for
election as Trustees. If for any reason any of the nominees become unavailable
for election, the proxies solicited will be voted for such nominees as are
selected by the Board of Trustees. The Board of Trustees has no reason to
believe that any of the nominees will be unable or unwilling to continue to
serve as a Trustee if elected. However, in the event that any nominee should
become unable or for good cause unwilling to serve, the Common Shares
represented by proxies received will be voted for another nominee selected by
the Board.
The following table sets forth information with respect to each nominee
nominated to serve as a Trustee for a term to expire in 2005.
NAME OF TRUSTEE/
NOMINEE FOR ELECTION AGE PRINCIPAL OCCUPATION
-------------------- --- --------------------
Charles L. Edson . . . . . . . . 67 Mr. Edson is a Managing Trustee of CharterMac. Mr. Edson is a retired
partner of the law firm Nixon Peabody LLP where he focused on all aspects
of housing development, management finance and taxation. He currently
serves as counsel to several of governmental, trade and public interest
entities and groups on housing and legislative matters and is the Co-Editor-
in-Chief for the Housing and Development Reporter, a news and
information service published by The West Group. Mr. Edson is an Adjunct
Professor of Law at Georgetown University Law Center where he teaches a
seminar on federally assisted housing programs. During his career, he has
served as the Transition Director for the Department of Housing and Urban
Development on President Carter's transition staff and has also held the
position of Chief in the Public Housing Section at the Office of General
Counselor at the Department of Housing and Urban Development. Mr.
Edson received a Bachelor of Arts, magna cum laude, from Harvard College
and a Juris Doctor degree from Harvard Law School.
12
NAME OF TRUSTEE/
NOMINEE FOR ELECTION AGE PRINCIPAL OCCUPATION
-------------------- --- --------------------
Alan P. Hirmes . . . . . . . . . 47 Mr. Hirmes is a Managing Trustee, the Executive Vice President and the
Secretary of CharterMac and is a Senior Vice President and a Member of
the sole general partner of the Manager. Mr. Hirmes is also a Partner and
a Senior Managing Director of Related Capital, where he is responsible
for overseeing the finance, accounting and portfolio management
departments and the joint venture development program. Mr. Hirmes has
been a Certified Public Accountant in New York since 1978. Prior to
joining Related Capital in October 1983, Mr. Hirmes was employed by
Weiner & Co., certified public accountants. Mr. Hirmes graduated from
Hofstra University with a Bachelor of Arts degree. Mr. Hirmes also serves
on the Board of Directors of Aegis and the Board of Trustees of AMAC.
Thomas W. White. . . . . . . . . 64 Mr. White is a Managing Trustee of CharterMac. Mr. White retired as a
Senior Vice President of Fannie Mae in the multifamily activities
department, where he was responsible for the development and
implementation of policies and procedures for all Fannie Mae
multifamily programs, including the delegated underwriting and
servicing program, prior approval program and negotiated swap and
negotiated cash purchases product lines. He was also responsible for
asset management of multifamily loans in portfolio or Mortgage-Backed
Securities. Mr. White joined Fannie Mae in November 1987 as director
of multifamily product management. He was elected Vice President for
multifamily asset acquisition in November 1998 and assumed his
position of Senior Vice President in November 1990. Prior to joining
Fannie Mae, he served as an investment banker with Bear Stearns, Inc.
He also was the executive vice president of the National Council of State
Housing Agencies; chief underwriter for the Michigan State Housing
Development Authority; and served as a state legislator in the state of
Michigan. Mr. White currently serves as a consultant to CharterMac.
PROPOSAL #2: AMENDMENT OF TRUST AGREEMENT TO INCREASE THE NUMBER OF AUTHORIZED
SHARES TO 100,000,000
GENERAL
CharterMac's Amended and Restated Trust Agreement (the "Trust Agreement")
currently authorizes the issuance of up to 50,000,000 shares of beneficial
interest (common, preferred or otherwise) ("Shares"). On March 13, 2002,
CharterMac's Board of Trustees unanimously approved, subject to Shareholder
approval, an amendment to Section 6.1 of the Trust Agreement to increase the
number of authorized Shares from 50,000,000 to 100,000,000. Under the amendment,
the first line of the first paragraph of Section 6.1 of the Trust Agreement
would read as follows:
6.1 Authorization of Shares. The Trust is authorized to issue 100,000,000
Shares.
As of April 16, 2002, CharterMac had 41,161,138 Common Shares issued and
41,152,738 Common Shares outstanding. In addition, 1,882,364 CRA Preferred
Shares, which are convertible into 1,764,663 Common Shares, were outstanding.
These 1,764,663 Common Shares have been reserved for issuance upon conversion of
the CRA Preferred Shares at the holder's option. Pursuant to CharterMac's Share
Option Plan, options to purchase 228,262 Common Shares, representing the
unexercised balance of options, have been granted to CharterMac's officers and
employees of an affiliate of RCLP, and 1,760,853 shares have been reserved for
issuance pursuant to an S-8 filed with the SEC on June 8, 1998. Also reserved
with the S-8 filing was an additional 15,117 Shares for future compensation of
independent Trustees. Finally, on May 3, 2000, CharterMac reserved 1,000,000
Shares for issuance in connection with the Dividend Reinvestment Program. As a
result of the foregoing Shares which have been reserved or issued, CharterMac
only has 3,952,266 unissued Shares remaining.
13
BENEFITS OF AMENDMENT
The Board of Trustees believes that the proposal to amend the Trust
Agreement to increase the number of Shares authorized from 50,000,000 to
100,000,000 is in the best interest of CharterMac and its Shareholders.
In the past 12 months, CharterMac has successfully completed three Common
Share offerings, issuing 18,381,000 Common Shares in exchange for approximately
$275.6 million in gross proceeds. CharterMac has used the proceeds from these
offerings to invest in additional tax-exempt revenue bonds, growing the assets
of the Company to $1.4 billion as of December 31, 2001, as well as to reduce
indebtedness. In order to continue to grow, CharterMac must continue to access
the equity capital markets and incur indebtedness. As CharterMac is limited
pursuant to the Trust Agreement, to only incur permanent indebtedness of 50% of
Total Asset Value, CharterMac must be able to continue to issue Shares in order
to achieve this growth.
CharterMac consistently reviews the most economically viable, non-dilutive
ways to fund its investment activity, and has been able to issue Common Shares
over the past year at favorable pricing. In a period of general market
uncertainty, CharterMac's Common Shares have been well received by the equity
capital markets and have sustained little share price volatility. Therefore,
CharterMac anticipates that it will continue to be able to issue Common Shares
through public offerings at favorable pricing, and will need the capacity to do
this, although there can be no assurances that favorable pricing can be
achieved.
CharterMac also intends to issue Common Shares, as the Company has done in
the past, in connection with general corporate purposes.
By increasing the authorized Shares from 50,000,000 to 100,000,000, such
availability would eliminate the delay and expense involved in first conducting
a special meeting of Shareholders to specifically increase the authorized Shares
and would provide CharterMac with the flexibility to act in a timely manner to
take advantage of favorable market conditions and other opportunities, including
issuing Common Shares pursuant to its effective shelf registration statement.
EFFECTS OF AMENDMENT
The increase in the authorized Shares and the subsequent issuance of such
Shares could have the effect of delaying or preventing a change in control of
the Company without further action by the Shareholders. To the extent that
additional Shares are issued in the future, they will decrease existing
Shareholders' percentage equity ownership and, depending upon the price at which
they are issued, could be dilutive to existing Shareholders.
VOTE REQUIRED TO AMEND THE TRUST AGREEMENT TO INCREASE THE NUMBER OF AUTHORIZED
SHARES
The Trust Agreement will be amended to reflect the increase in the number
of authorized Shares upon the affirmative vote or written consent of a majority
of the outstanding Common Shares.
THE BOARD OF TRUSTEES DEEMS ADVISABLE, AND RECOMMENDS A VOTE FOR, THE
AMENDMENT TO THE TRUST AGREEMENT TO INCREASE THE AUTHORIZED SHARES FROM
50,000,000 TO 100,000,000.
14
EXECUTIVE COMPENSATION
TRUSTEES AND MANAGEMENT
CharterMac has three executive officers and eight Trustees (three of whom
are Independent Trustees). CharterMac does not pay or accrue any fees, salaries
or other forms of compensation to its officers other than options which may be
received under the Share Option Plan. Independent Trustees receive compensation
for serving as Independent Trustees. Mr. Edson receives compensation at the rate
of $30,000 per year, payable $20,000 in cash (or, at Mr. Edson's option, Common
Shares) and Common Shares having an aggregate value of $10,000, based on the
fair market value at the date of issuance, in addition to an expense
reimbursement for attending meetings of the Board of Trustees. Messrs. Allen and
Fisch receive compensation at the rate of $17,500 per year payable $7,500 in
cash (or, at Messrs. Allen's or Fisch's option, Common Shares) and Common Shares
having an aggregate value of $10,000, based on the fair market value at the date
of issuance, in addition to an expense reimbursement for attending meetings of
the Board of Trustees.
The Manager, at its expense, provides all personnel necessary to conduct
CharterMac's regular business. The Manager receives various fees for advisory
and other services performed under the Management Agreement, as further
described in the "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS" section of
this Proxy Statement. An affiliate of the Manager pays all salaries, bonuses and
other compensation (other than options which may be received under the Share
Option Plan) to the officers of CharterMac and the general partner of the
Manager. Certain members and officers of the sole general partner of the Manager
and certain officers of CharterMac receive compensation from the Manager and its
affiliates for services performed for various affiliated entities, which may
include services performed for CharterMac. Such compensation may be based in
part on the performance of CharterMac; however, the Manager believes that any
compensation attributable to services performed for CharterMac is immaterial.
SHARE OPTION PLAN
The Share Option Plan was adopted to attract and retain qualified
individuals to serve as trustees, officers and/or employees of CharterMac, its
subsidiaries, the Manager and any successor manager, as well as to harmonize the
financial interests of such individuals with the interests of the Company's
shareholders generally (i.e., by providing them with substantial financial
interests in the Company's success). The Compensation Committee, which is
comprised of Messrs. Allen and Fisch, administers the Share Option Plan.
Pursuant to the Share Option Plan, if CharterMac's distributions per Common
Share in the immediately preceding calendar year exceed $0.9517 per Common
Share, the Compensation Committee has the authority to issue options to
purchase, in the aggregate, that number of Common Shares which is equal to three
percent of the Common Shares outstanding as of December 31 of the immediately
preceding calendar year (or in the initial year, as of October 1, 1997),
provided that the Compensation Committee may only issue, in the aggregate,
options to purchase a maximum number of Common Shares over the life of the Share
Option Plan equal to 2,058,683 Common Shares (i.e., 10% of the Common Shares
outstanding on October 1, 1997.)
Subject to the limitations described in the preceding paragraph, if the
Compensation Committee does not grant the maximum number of options in any year,
then the excess of the number of authorized options over the number of options
granted in such year will be added to the number of authorized options in the
next succeeding year and will be available for grant by the Compensation
Committee in such succeeding year.
All options granted by the Compensation Committee will have an exercise
price equal to or greater than the fair market value of the Common Shares on the
date of the grant. The maximum option term is ten years from the date of grant.
All Common Share options granted pursuant to the Share Option Plan may vest
immediately upon issuance or in accordance with the determination of the
Compensation Committee. No options were granted for the years ended December 31,
1997 or December 31, 1998. In 1999, CharterMac distributed $0.995 per Common
Share. On May 1, 2000 the compensation committee issued 297,830 options to
employees of affiliates of the Manager.
In 2000, CharterMac distributed $1.07, thus enabling the Compensation
Committee to issue options under the Share Option Plan and in 2001, CharterMac
distributed $1.14, thus enabling the Compensation Committee to issue options
under the Share Option Plan, however, no options have been granted as of the
date of this proxy for either year.
15
REPORT OF THE COMPENSATION COMMITTEE
The Compensation Committee is comprised of two Independent Trustees
(Messrs. Allen and Fisch). The role of the Compensation Committee is to
administer the policies governing the Share Option Plan. Because CharterMac does
not pay salaries and bonuses to the officers of CharterMac or the general
partner of the Manager, the Compensation Committee does not determine
executives' salary levels. Subject to the restrictions contained in the Share
Option Plan, option compensation is intended to be set at a level competitive
with the amounts paid to the management of similarly sized companies in similar
industries. The Committee also evaluates the performance of management when
determining the number of options to be issued.
CharterMac's grants of share options are structured to link the
compensation of the officers of CharterMac and the officers of the general
partner of the Manager (and its affiliates) with CharterMac's performance.
Through the establishment of the Share Option Plan, CharterMac has aligned the
financial interests of its executives (and the executives of the Manager) with
the results of CharterMac's performance, which is intended to enhance
shareholder value. The Compensation Committee may only grant options if certain
performance levels are met and is limited in the number of options which may be
granted each year (See "Share Option Plan" above). The amount of options which
may be granted will be set at levels that the Compensation Committee believes to
be consistent with others in CharterMac's industry, with such compensation
contingent upon CharterMac's level of annual and long-term performance.
Section 162 (m) was added to the Internal Revenue Code as part of the
Omnibus Budget Reconciliation Act of 1993. Section 162 (m) limits the deduction
for compensation paid to the Chief Executive Officer and the other executive
officers to the extent that compensation of a particular executive exceeds
$1,000,000 (less the amount of any "excess parachute payments" as defined in
Section 280G of the Code) in any one year. However, under Section 162(m), the
deduction limit does not apply to certain "performance-based" compensation
established by an independent compensation committee which conforms to certain
restrictive conditions stated under the Code and related regulations. It is
CharterMac's goal to have compensation paid to its five most highly compensated
officers qualify as performance based compensation deductible for federal income
tax purposes under Section 162 (m). Given the fact that CharterMac is externally
managed and the only compensation that currently may be paid to its executives
are options pursuant to the Share Option Plan, it is unlikely that Section 162
(m) will present any concerns.
COMPENSATION COMMITTEE
Peter T. Allen
Arthur P. Fisch
16
SHARE PERFORMANCE GRAPH
The following share performance graph compares CharterMac's performance to
the S&P 500 and the Russell 2000 stock index. CharterMac is currently one of the
companies included in the Russell 2000 stock index, an index that measures the
performance of small market capitalization companies. The graph assumes a $100
investment on October 16, 1997 (the day that Charter Mac began trading on the
American Stock Exchange). All stock price performance figures includes the
reinvestment of dividends.
COMPARISON OF 50 MONTH CUMULATIVE TOTAL RETURN*
AMONG CHARTER MUNICIPAL MORTGAGE ACCEEPTANCE CO,
THE S&P 500 INDEX AND THE RUSSELL 2000 INDEX
[PERFORMANCE GRAPH]
---------------
* $100 invested on 10/16/97 in shares or on 9/30/97 in index-including
reinvestment of dividends. Fiscal year ended December 31.
CUMULATIVE TOTAL RETURN
-----------------------
10/16/97 12/97 12/98 12/99 12/00 12/01
-------- ------- ------- ------- ------- -------
CHARTERMAC . . . . . . . . . . . . . . . $100 $102.35 $104.47 $109.68 $136.13 $177.16
S&P 500. . . . . . . . . . . . . . . . . 100 102.87 132.27 160.10 145.52 128.23
RUSSELL 2000 . . . . . . . . . . . . . . 100 96.65 94.19 114.21 110.76 113.52
17
AUDIT COMMITTEE
AUDIT COMMITTEE CHARTER
On June 14, 2000, the Board of Trustees adopted the following Audit
Committee Charter. The Audit Committee Charter will be reviewed, updated and
approved by the Board of Trustees each year:
ROLE AND INDEPENDENCE
The audit committee, of the Board of Trustees of Charter Municipal
Mortgage Acceptance Company (the "Company"), assists the Board in
fulfilling its responsibility for oversight of the quality and integrity of
the accounting, auditing and reporting practices of the Company and other
such duties as directed by the Board. The membership of the Company's audit
committee (the "Committee") shall consist of at least three Trustees who
are generally knowledgeable in financial and auditing matters, including at
least one member with accounting or related financial management expertise.
Each member shall be free of any relationship that, in the opinion of the
Board, would interfere with his or her individual exercise of independent
judgment, and shall meet the director independence requirements for serving
on the Committee as set forth in the corporate governance standards of the
American Stock Exchange. The Committee is expected to maintain free and
open communication (including private executive sessions at least annually)
with the independent accountants, the internal auditors, if any, and the
management of the Company. In discharging this oversight role, the
Committee is empowered to investigate any matter brought to its attention,
with full power to retain outside counsel or other experts for this
purpose.
The Board of Trustees shall appoint one member of the Committee as
chairperson. He or she shall be responsible for leadership of the
Committee, including preparing the agenda, presiding over the meetings,
making Committee assignments and reporting to the Board of Trustees. The
chairperson will also maintain regular liaison with the CEO, CFO, and the
lead independent audit partner.
RESPONSIBILITIES
The Committee's primary responsibilities include:
Recommending to the Board the independent accountant to be selected or
retained to audit the financial statements of the Company. In so doing, the
Committee will request from the auditor a written affirmation, consistent
with Independence Standards Board Standard 1, that the auditor is in fact
independent, discuss with the auditor any relationships that may impact the
auditor's independence, and recommend to the board any actions necessary to
oversee the auditor's independence.
Overseeing the independent auditor relationship by discussing with the
auditor the nature and rigor of the audit process, receiving and reviewing
audit reports, and providing the auditor full access to the Committee (and
the Board) to report on any and all appropriate matters.
Reviewing the audited financial statements and discussing them with
management and the independent auditor. These discussions shall include
consideration of the quality of the Company's accounting principles as
applied in its financial reporting, including review of estimates, reserves
and accruals, review of judgmental areas, review of audit adjustments
whether or not recorded and such other inquiries as may be appropriate.
Based on the review, the Committee shall make its recommendation to the
Board as to the inclusion of the Company's audited financial statements in
the Company's annual report on Form 10-K.
Reviewing with management and the independent auditor the quarterly
financial information prior to the Company's filing of Form 10-Q. This
review may be performed by the Committee or its chairperson.
Discussing with management, the internal auditors, if any, and the
external auditors the quality and adequacy of the Company's internal
controls.
Discussing with management the status of pending litigation, taxation
matters and other areas of oversight to the legal and compliance area as
may be appropriate.
18
Reporting Committee activities to the full Board and issuing annually a
report to be included in the proxy statement (including appropriate
oversight conclusions) for submission to the shareholders.
The Committee's job is one of oversight. Management is responsible for
the preparation of the Company's financial statements and the independent
auditors are responsible for auditing those financial statements. The
Committee and the Board recognize that management (including the internal
audit staff, if any) and the independent auditors have more resources and
time, and more detailed knowledge and information regarding the Company's
accounting, auditing, internal control and financial reporting practices
than the Committee does; accordingly the Committee's oversight role does
not provide any expert or special assurances as to the financial statements
and other financial information provided by the Company to its shareholders
and others.
AUDIT COMMITTEE REPORT
The Audit Committee of CharterMac's Board of Trustees has issued the
following report with respect to the audited financial statements of the Company
for the fiscal year ended December 31, 2001:
o The Audit Committee has reviewed and discussed with CharterMac's
management the Company's fiscal 2001 audited financial statements;
o The Audit Committee has discussed with Deloitte & Touche LLP
(CharterMac's independent auditors) the matters required to be
discussed by Statement on Auditing Standards No. 61 as amended by SAS
No. 90;
o The Audit Committee has received the written disclosures and letter
from the independent auditors required by Independence Standards Board
Standard No. 1 (which related to the auditors' independence from the
Company and its related entities) and has discussed with the auditors
their independence from CharterMac;
Based on the review and discussions referred to in the three items above,
the Audit Committee recommended to the Board of Trustees that the audited
financial statements be included in CharterMac's Annual Report on Form 10-K for
the fiscal year ended December 31, 2001.
Submitted by the Audit Committee of CharterMac's Board of Trustees:
Charles L. Edson - Chairman
Peter T. Allen
Arthur P. Fisch
INDEPENDENT PUBLIC ACCOUNTANTS
Deloitte & Touche LLP have been and are presently the independent auditors
for CharterMac. Representatives of Deloitte & Touche LLP are expected to be
present at the Meeting and to be available to respond to appropriate questions
from holders of Common Shares.
AUDIT FEES
The aggregate fees billed by Deloitte & Touche LLP, the member firms of
Deloitte Touche Tohmatsu, and their respective affiliates (collectively,
"Deloitte") for professional services rendered for the audit of the Company's
annual financial statements for the year ended December 31, 2001 and for the
reviews of the financial statements included in the Company's Quarterly Reports
on Form 10-Q for that year were $185,000.
FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES
Deloitte did not provide the Company with any professional services for
information technology services relating to financial information systems design
and implementation for the year ended December 31, 2001.
ALL OTHER FEES
The aggregate fees billed by Deloitte for services rendered to the Company,
other than the services described above under "Audit Fees" and "Financial
Information Systems Design and Implementation Fees" for the year
19
ended December 31, 2001 were $407,358, including audit-related services of
$178,800, primarily for comfort letters and consents required for equity
offerings, and $228,558 for non-audit services, primarily for income tax return
preparation and related consultations, and due diligence relating to a business
acquisition.
EXPENSES OF SOLICITATION
The cost of soliciting proxies will be borne by CharterMac. Brokers and
nominees should forward soliciting materials to the beneficial owners of the
Common Shares held of record by such person, and CharterMac will reimburse them
for their reasonable forwarding expenses. In addition to the use of the mails,
telephone and Internet, proxies may be solicited by trustees, officers and
regular employees of CharterMac, the Manager and a proxy solicitation firm by
personal interview or telephone.
VOTING PROCEDURES
Equiserve, LP (the "Inspector") has been appointed the inspector of
elections. The Inspector will count all votes cast, in person or by submission
of a properly executed proxy, received at or prior to the Meeting. Abstentions
and "broker non-votes" (i.e., nominees holding Common Shares for beneficial
owners who have not voted on a specific matter) (i) will be treated as present
for purposes of determining whether a quorum is present at the Meeting and (ii)
will have no effect on the vote with respect to Proposal 1, but will be counted
as a vote against Proposal 2.
SHAREHOLDER PROPOSALS
Any proposal by a shareholder of CharterMac intended to be presented at the
2003 Annual Meeting of Shareholders must be received by CharterMac at its
principal executive office not later than January 6, 2003 for inclusion in
CharterMac's proxy statement and form of proxy relating to that meeting. Any
such proposal must also comply with other requirements of the proxy solicitation
rules of the Commission.
ANNUAL REPORT ON FORM 10-K
UPON WRITTEN REQUEST BY ANY SHAREHOLDER ENTITLED TO VOTE AT THE MEETING,
CHARTERMAC WILL FURNISH THAT PERSON WITHOUT CHARGE A COPY OF ITS ANNUAL REPORT
ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2001 WHICH IS FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION, INCLUDING THE FINANCIAL STATEMENTS AND
SCHEDULES THERETO. Requests should be addressed to Brenda Abuaf at Charter
Municipal Mortgage Acceptance Company, 625 Madison Avenue, New York, New York
10022-1801.
OTHER BUSINESS
The Board of Trustees does not know of any other matters to be brought
before the Meeting except those set forth in the notice thereof. If other
business is properly presented for consideration at the Meeting, it is intended
that the proxies will be voted by the persons named therein in accordance with
their judgment on such matters.
It is important that your Common Shares be represented at the Meeting. If
you are unable to be present in person, please complete, date, sign and return
the enclosed stamped, self-addressed proxy-card, or vote by telephone or on the
Internet. Your failure to do so will increase the costs of operating CharterMac
and decrease the return on your investment.
By Order of the Board of Trustees
/s/ Stuart J. Boesky
-------------------------------------
Stuart J. Boesky
President and Chief Executive Officer
April 30, 2002
20
[CharterMac Logo]
Dear Shareholder:
Please take note of the important information enclosed with this Proxy. There
are a number of issues related to the operation of CharterMac that require your
immediate attention.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
Similar to last year, you can vote your Shares by Internet or phone. Follow the
instructions on the reverse side of proxy card if you wish to do so.
If you chose to vote by mail, please mark the boxes on the proxy card to
indicate how your shares will be voted. Then sign the card, detach it and return
your proxy in the enclosed postage paid envelope.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
Charter Municipal Mortgage Acceptance Company
--------------------------------------------------------------------------------
Proxy
CHARTER MUNICIPAL MORTGAGE ACCEPTANCE COMPANY
625 Madison Avenue
New York, New York 10022
SOLICITED BY THE BOARD OF TRUSTEES
FOR THE ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints Stuart J. Boesky and Michael J. Brenner, each
with the power to appoint his substitute, and hereby authorizes them to
represent and to vote, as designated on the reverse side, all common shares of
Charter Municipal Mortgage Acceptance Company ("CharterMac") held of record by
the undersigned on April 16, 2002 at the Annual Meeting of Shareholders to be
held on June 11, 2002 and any adjournments thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED, IF NO
DIRECTION IS GIVEN WITH RESPECT TO A PARTICULAR PROPOSAL, THIS PROXY WILL BE
VOTED FOR SUCH PROPOSAL.
PLEASE MARK, DATE, SIGN, AND RETURN THIS PROXY CARD PROMPTLY, USING THE
ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
[SEE REVERSE SIDE] [SEE REVERSE SIDE]
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
Vote by Telephone Vote by Internet
----------------- ----------------
Its fast, convenient and immediate! It's fast, convenient and your vote is immediately
Call Toll-Free on a Touch-Tone Phone confirmed and posted.
1-877-PRX-VOTE (1-888-779-8683)
--------------------------------------------------- ---------------------------------------------------
Follow these four easy steps: Follow these four easy steps:
1. Read the accompanying Proxy Statement/ and 1. Read the accompanying Proxy Statements and
Proxy Card. Proxy Card.
2. Call the toll-free number 1-877-PRX-VOTE (1- 2. Go to the Website
877-779-8683). http://www.eproxyvote.com/chc
3. Enter your 14-digit Voter Control Number 3. Enter your 14-digit Voter Control Number
located on your Proxy Card above your name. located on your Proxy Card above your name.
4. Follow the recorded Instructions. 4. Follow the recorded Instructions.
--------------------------------------------------- ---------------------------------------------------
YOUR VOTE IS IMPORTANT! YOUR VOTE IS IMPORTANT!
Call 1-877-PRX-VOTE anytime! Go to WWW.EPROXYVOTE.COM/CHC anytime!
Do not return your Proxy Card if you are voting by Telephone or Internet
---------------------------------------------------------------------------------------------------------
DETACH HERE
[X] Please mark votes as in this example.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS
1. Election of Trustees. 3. In their discretion, the proxies are authorized
Nominees: Charles L. Edson, Alan P. Hirmes to vote upon any other business that may properly
& Thomas W. White come before the meeting.
FOR ALL WITHOLD ALL
[ ] [ ]
[ ]---------------------------------
FOR ALL nominees EXCEPT as noted above
2. Authorized Shares Amendment. MARK HERE FOR ADDRESS CHANGE AND
Proposal to amend the Trust Agreement to NOTE AT LEFT [ ]
permit CharterMac to increase the number Please sign exactly as name appears hereon. Joint
of authorized shares from owners should each sign. Executors,
50,000,000 to 100,000,000 administrators, trustees and guardians or other
fiduciaries should give full title as such. If
signing for a corporation, please sign in full
corporate name by a duly authorized officer.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Signature: Date: Signature: Date:
---------------------- ------- ----------------------- -------