<DOCUMENT>
<TYPE>EX-99.2D
<SEQUENCE>2
<FILENAME>ex99-2di.txt
<DESCRIPTION>EXHIBIT 2(D)(I)
<TEXT>

<PAGE>
                                                                 EXHIBIT 2(d)(i)

                             ARTICLES SUPPLEMENTARY

                COHEN & STEERS QUALITY INCOME REALTY FUND, INC.
            Articles Supplementary Creating And Fixing The Rights of
               Series M7 Taxable Auction Market Preferred Shares

    Cohen & Steers Quality Income Realty Fund, Inc., a Maryland corporation
having its principal office in the City of Baltimore in the State of Maryland
(the 'Corporation'), certifies to the State Department of Assessments and
Taxation of Maryland that:

    First: Pursuant to authority expressly vested in the Board of Directors of
the Corporation by Article FIFTH of its Articles of Incorporation, as amended
and supplemented (which as hereafter amended, restated and supplemented from
time to time, is together with these Articles Supplementary, the 'Charter'), and
the Maryland General Corporation Law (the 'MGCL'), the Board of Directors has
duly classified out of the Corporation's authorized and unissued common stock,
and authorized the creation and issuance of, 3,760 shares of the Corporation's
Taxable Auction Market Preferred Shares ('AMPS') (par value $.001 per share) and
has further classified all of such shares as 'Series M7 AMPS,' liquidation
preference $25,000 per share (herein referred to as the 'Series').

    Second: Pursuant to Section 2-411 of the MGCL and authority granted by
Article III of the Corporation's By-laws, the Board of Directors of the
Corporation has appointed a pricing committee (the 'Pricing Committee') and has
authorized such Pricing Committee to fix the terms of the Series, as set forth
herein.

    Third: The preferences, voting powers, restrictions, limitations as to
dividends, qualifications, and terms and conditions of redemption, of the Series
are as follows:

                                  DESIGNATION

    Series M7 AMPS: A series of AMPS, par value $.001 per share, liquidation
preference $25,000 per share, is hereby designated 'Series M7 Taxable Auction
Market Preferred Shares'. Each share of the Series may be issued on a date to be
determined by the Board of Directors of the Corporation or pursuant to their
delegated authority; have an initial dividend rate per annum, initial Dividend
Period and an initial Dividend Payment Date as will be determined in advance of
the issuance thereof by the Board of Directors of the Corporation or pursuant to
their delegated authority; and have such other preferences, rights, voting
powers, restrictions, limitations as to dividends, qualifications and terms and
conditions of redemption, in addition to those required by applicable law, or as
are set forth in Part I and Part II of these Articles Supplementary. The Series
will constitute a separate series of AMPS of the Corporation.

    Subject to the provisions of Section 11(b) of Part I hereof, the Board of
Directors of the Corporation may, in the future, reclassify additional shares of
the Corporation's unissued common stock as preferred stock, with the same
preferences, rights, voting powers, restrictions, limitations as to dividends,
qualifications and terms and conditions of redemption and other terms herein
described, except that the dividend rate for its initial Dividend Period, its
initial Dividend Payment Date and any other changes in the terms herein set
forth will be as set forth in the Articles Supplementary with respect to the
additional shares.

    As used in Part I and Part II of these Articles Supplementary, capitalized
terms will have the meanings provided in Section 17 of Part I and Section 1 of
Part II of these Articles Supplementary.

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                             PART I: TERMS OF AMPS

    1. Number of Shares; Ranking.

    (a) The initial number of authorized shares constituting the Series is 3,760
shares. No fractional shares of the Series will be issued.

    (b) Shares of the Series which at any time have been redeemed or purchased
by the Corporation will, after such redemption or purchase, have the status of
authorized but unissued shares of preferred stock.

    (c) Shares of the Series will rank on a parity with shares of any other
series of preferred stock of the Corporation (including any other AMPS) as to
the payment of dividends to which such shares are entitled.

    (d) No Holder of shares of the Series will have, solely by reason of being
such a holder, any preemptive or other right to acquire, purchase or subscribe
for any shares of the Series, Common Shares of the Corporation or other
securities of the Corporation which it may hereafter issue or sell.

    2. Dividends.

    (a) The Holders of shares of the Series will be entitled to receive, when,
as and if declared by the Board of Directors, out of funds legally available
therefor, cumulative cash dividends on their shares at the Applicable Rate,
determined as set forth in paragraph (c) of this Section 2, and no more, payable
on the respective dates determined as set forth in paragraph (b) of this
Section 2. Dividends on the Outstanding shares of the Series issued on the Date
of Original Issue will accumulate from the Date of Original Issue.

    (b) (i) Dividends will be payable when, as and if declared by the Board of
Directors following the initial Dividend Payment Date, subject to subparagraph
(b)(ii) of this Section 2, on the shares of the Series, as follows:

        (A) with respect to any Dividend Period of one year or less, on the
    Business Day following the last day of such Dividend Period; provided,
    however, if the Dividend Period is more than 91 days then on the 91st, 181st
    and 271st days within such period, if applicable, and on the Business Day
    following the last day of such Dividend Period; and

        (B) with respect to any Dividend Period of more than one year, on a
    quarterly basis on each January 1, April 1, July 1 and October 1 within such
    Dividend Period and on the Business Day following the last day of such
    Dividend Period.

    (ii) If a day for payment of dividends resulting from the application of
subparagraph (b) above is not a Business Day, then the Dividend Payment Date
will be the first Business Day following such day for payment of dividends.

    (iii) The Corporation will pay to the Paying Agent not later than
12:00 noon, New York City time, on each Dividend Payment Date for the Series, an
aggregate amount of immediately available funds equal to the dividends to be
paid to all Holders of the Series on such Dividend Payment Date. The Corporation
will not be required to establish any reserves for the payment of dividends.

    (iv) All moneys paid to the Paying Agent for the payment of dividends will
be held in trust for the payment of such dividends by the Paying Agent for the
benefit of the Holders specified in subparagraph (b)(v) of this Section 2. Any
moneys paid to the Paying Agent in accordance with the foregoing but not applied
by the Paying Agent to the payment of dividends will, upon request and to the
extent permitted by law, be repaid to the Corporation at the end of 90 days from
the date on which such moneys were to have been so applied.

    (v) Each dividend on the Series will be paid on the Dividend Payment Date
therefor to the Holders of the Series as their names appear on the stock ledger
or stock records of the Corporation on the Business Day next preceding such
Dividend Payment Date; provided, however, if dividends are in arrears, they may
be declared and paid at any time to Holders as their names appear on the stock
ledger or stock records of the Corporation on such date not exceeding 15

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days preceding the payment date thereof, as may be fixed by the Board of
Directors. No interest will be payable in respect of any dividend payment or
payments which may be in arrears.

    (c) (i) The dividend rate on Outstanding shares of the Series during the
period from and after the Date of Original Issue to and including the last day
of the initial Dividend Period therefor will be equal to the rate as determined
in the manner set forth under 'Designation' above. For each subsequent Dividend
Period for the Series, the dividend rate will be equal to the rate per annum
that results from an Auction (but the rate set at the Auction will not exceed
the Maximum Rate); provided, however, that if an Auction for any subsequent
Dividend Period of the Series is not held for any reason or if Sufficient
Clearing Orders have not been made in an Auction (other than as a result of all
shares of the Series being the subject of Submitted Hold Orders and other than
in an auction for a Special Dividend Period), then the dividend rate on the
shares of the Series for any such Dividend Period will be the Maximum Rate
(except (i) during a Default Period when the dividend rate will be the Default
Rate, as set forth in Section 2(c)(ii) below or (ii) after a Default Period and
prior to the beginning of the next Dividend Period when the dividend rate will
be the Maximum Rate at the close of business on the last day of such Default
Period). If the Corporation has declared a Special Dividend Period and there are
not Sufficient Clearing Orders, the dividend rate for the next rate period will
be the same as during the current rate period. If as a result of an
unforeseeable disruption of the financial markets, an Auction cannot be held for
a period of more than three business days, the dividend rate for the Subsequent
Dividend Period will be the same as the dividend rate for the current Dividend
Period.

    (ii) Subject to the cure provisions in Section 2(c)(iii) below, a 'Default
Period' with respect to the Series will commence on any date the Corporation
fails to deposit irrevocably in trust in same-day funds, with the Paying Agent
by 12:00 noon, New York City time, (A) the full amount of any declared dividend
on the Series payable on the Dividend Payment Date (a 'Dividend Default') or
(B) the full amount of any redemption price (the 'Redemption Price') payable on
the date fixed for redemption (the 'Redemption Date') (a 'Redemption Default'
and together with a Dividend Default, hereinafter referred to as 'Default').

    Subject to the cure provisions of Section 2(c)(iii) below, a Default Period
with respect to a Dividend Default or a Redemption Default will end on the
Business Day on which, by 12:00 noon, New York City time, all unpaid dividends
and any unpaid Redemption Price will have been deposited irrevocably in trust in
same-day funds with the Paying Agent. In the case of a Dividend Default, the
Applicable Rate for each Dividend Period commencing during a Default Period will
be equal to the Default Rate, and each subsequent Dividend Period commencing
after the beginning of a Default Period will be a Standard Dividend Period;
provided, however, that the commencement of a Default Period will not by itself
cause the commencement of a new Dividend Period. No Auction will be held during
a Default Period.

    (iii) No Default Period with respect to a Dividend Default or Redemption
Default will be deemed to commence if the amount of any dividend or any
Redemption Price due (if such default is not solely due to the willful failure
of the Corporation) is deposited irrevocably in trust, in same-day funds with
the Paying Agent by 12:00 noon, New York City time within three Business Days
after the applicable Dividend Payment Date or Redemption Date, together with an
amount equal to the Default Rate applied to the amount of such non-payment based
on the actual number of days comprising such period divided by 360 for the
Series. The Default Rate will be equal to the Reference Rate multiplied by
three (3).

    (iv) The amount of dividends per share payable (if declared) on each
Dividend Payment Date of each Dividend Period of less than one (1) year (or in
respect of dividends on another date in connection with a redemption during such
Dividend Period) will be computed by multiplying the Applicable Rate (or the
Default Rate) for such Dividend Period (or a portion thereof) by a fraction, the
numerator of which will be the number of days in such Dividend Period (or
portion thereof) that such share was Outstanding and for which the Applicable
Rate or the Default Rate was applicable and the denominator of which will be 360
for the Series, multiplying the amount so obtained by $25,000, and rounding the
amount so obtained to the nearest cent. During any Dividend Period of one (1)
year or more, the amount of dividends per share payable on any

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Dividend Payment Date (or in respect of dividends on another date in connection
with a redemption during such Dividend Period) will be computed as described in
the preceding sentence, except that it will be determined on the basis of a year
consisting of twelve 30-day months.

    (d) Any dividend payment made on shares of the Series will first be credited
against the earliest accumulated but unpaid dividends.

    (e) For so long as the shares of the Series are Outstanding, except as
otherwise contemplated by Part I of these Articles Supplementary, the
Corporation will not declare, pay or set apart for payment any dividend or other
distribution (other than a dividend or distribution paid in shares of, or
options, warrants or rights to subscribe for or purchase, Common Shares or other
shares ranking junior to the Series as to dividends or upon liquidation) with
respect to Common Shares or any other capital stock of the Corporation ranking
junior to the Series as to dividends or upon liquidation, or call for
redemption, redeem, purchase or otherwise acquire for consideration any Common
Shares or other capital stock ranking junior to the Series (except by conversion
into or exchange for shares of the Corporation ranking junior to the Series as
to dividends and upon liquidation), unless (i) immediately after such
transaction, the Corporation would have Eligible Assets with an aggregate
Discounted Value at least equal to the Preferred Shares Basic Maintenance Amount
and the 1940 Act Preferred Shares Asset Coverage would be achieved, (ii) all
cumulative and unpaid dividends due on or prior to the date of the transaction
have been declared and paid in full with respect to the Corporation's preferred
stock, including the Series or will have been declared and sufficient funds for
the payment thereof deposited with the Auction Agent, and (iii) the Corporation
has redeemed the full number of shares of preferred stock required to be
redeemed by any mandatory provision for redemption, including the Series
required to be redeemed by any provision for mandatory redemption contained in
Section 3(a)(ii) of Part I of these Articles Supplementary.

    (f) For so long as shares of the Series are Outstanding, except as set forth
in the next sentence, the Corporation will not declare, pay or set apart for
payment on any series of stock of the Corporation ranking, as to the payment of
dividends, on a parity with the Series for any period unless full cumulative
dividends have been or contemporaneously are declared and paid on the Series
through its most recent Dividend Payment Date. When dividends are not paid in
full upon the Series through its most recent Dividend Payment Date or upon any
other series of stock ranking on a parity as to the payment of dividends with
the Series through its most recent Dividend Payment Date, all dividends declared
upon the Series and any other such series of stock ranking on a parity as to the
payment of dividends with the Series will be declared pro rata so that the
amount of dividends declared per share on the Series and such other series of
preferred stock ranking on a parity therewith will in all cases bear to each
other the same ratio that accumulated dividends per share on the Series and such
other series of preferred stock ranking on a parity therewith bear to each
other.

    3. Redemption.

    (a) (i) After the initial Dividend Period, subject to the provisions of this
Section 3 and to the extent permitted under the 1940 Act and Maryland law, the
Corporation may, at its option, redeem in whole or in part out of funds legally
available therefor shares of the Series herein designated as (A) having a
Dividend Period of one year or less, on the Business Day after the last day of
such Dividend Period by delivering a notice of redemption not less than 15
calendar days and not more than 40 calendar days prior to the Redemption Date,
at a redemption price per share equal to $25,000, plus an amount equal to
accumulated but unpaid dividends thereon (whether or not earned or declared) to
the Redemption Date ('Redemption Price'), or (B) having a Dividend Period of
more than one year, on any Business Day prior to the end of the relevant
Dividend Period by delivering a notice of redemption not less than 15 calendar
days and not more than 40 calendar days prior to the Redemption Date, at the
Redemption Price, plus a redemption premium, if any, determined by the Board of
Directors after consultation with the Broker-Dealers and set forth in any
applicable Specific Redemption Provisions at the time of the designation of such
Dividend Period as set forth in Section 4 of Part I of these Articles
Supplementary; provided, however, that during a Dividend Period of more than one
year, no shares of the Series will be

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subject to optional redemption except in accordance with any Specific Redemption
Provisions approved by the Board of Directors after consultation with the
Broker-Dealers at the time of the designation of such Dividend Period.
Notwithstanding the foregoing, the Corporation will not give a notice of or
effect any redemption pursuant to this Section 3(a)(i) unless, on the date on
which the Corporation gives such notice and on the Redemption Date, (a) the
Corporation has available Deposit Securities with maturity or tender dates not
later than the day preceding the applicable Redemption Date and having a value
not less than the amount (including any applicable premium) due to Holders of
the Series by reason of the redemption of the Series on the Redemption Date and
(b) the Corporation would have Eligible Assets with an aggregate Discounted
Value at least equal to the Preferred Shares Basic Maintenance Amount
immediately subsequent to such redemption, if such redemption were to occur on
such date, it being understood that the provisions of paragraph (d) of this
Section 3 will be applicable in such circumstances in the event the Corporation
makes the deposit and takes the other action required thereby.

    (ii) If the Corporation fails as of any Valuation Date to meet the Preferred
Shares Basic Maintenance Amount Test or, as of the last Business Day of any
month, the 1940 Act Preferred Shares Asset Coverage, and such failure is not
cured within ten Business Days following the relevant Valuation Date, in the
case of a failure to meet the Preferred Shares Basic Maintenance Amount Test, or
the last Business Day of the following month in the case of a failure to meet
the 1940 Act Preferred Shares Asset Coverage (each an 'Asset Coverage Cure
Date'), the Series will be subject to mandatory redemption out of funds legally
available therefor. The number of shares of the Series to be redeemed in such
circumstances will be equal to the lesser of (A) the minimum number of shares of
the Series the redemption of which, if deemed to have occurred immediately prior
to the opening of business on the relevant Asset Coverage Cure Date, would
result in the Corporation meeting the Preferred Shares Basic Maintenance Amount
Test, and the 1940 Act Preferred Shares Asset Coverage, as the case may be, in
either case as of the relevant Asset Coverage Cure Date (provided that, if there
is no such minimum number of shares the redemption of which would have such
result, all shares of the Series then Outstanding will be redeemed) and (B) the
maximum number of shares of the Series that can be redeemed out of funds
expected to be available therefor on the Mandatory Redemption Date at the
Mandatory Redemption Price set forth in subparagraph (a)(iii) of this
Section 3.

    (iii) In determining the shares of the Series required to be redeemed in
accordance with the foregoing Section 3(a)(ii), the Corporation will allocate
the number of shares required to be redeemed to satisfy the Preferred Shares
Basic Maintenance Amount Test or the 1940 Act Preferred Shares Asset Coverage,
as the case may be, pro rata or among the Holders of the Series in proportion to
the number of shares they hold and shares of other preferred stock subject to
mandatory redemption provisions similar to those contained in this Section 3,
subject to the further provisions of this subparagraph (iii). The Corporation
will effect any required mandatory redemption pursuant to: (A) the Preferred
Shares Basic Maintenance Amount Test, as described in subparagraph (a)(ii) of
this Section 3, no later than 30 days after the Corporation last met the
Preferred Shares Basic Maintenance Amount Test, or (B) the 1940 Act Preferred
Shares Asset Coverage, as described in subparagraph (a)(ii) of this Section 3,
no later than 30 days after the Asset Coverage Cure Date (the 'Mandatory
Redemption Date'), except that if the Corporation does not have funds legally
available for the redemption of, or is not otherwise legally permitted to
redeem, the number of shares of the Series which would be required to be
redeemed by the Corporation under clause (A) of subparagraph (a)(ii) of this
Section 3 if sufficient funds were available, together with shares of other
preferred stock which are subject to mandatory redemption under provisions
similar to those contained in this Section 3, or the Corporation otherwise is
unable to effect such redemption on or prior to such Mandatory Redemption Date,
the Corporation will redeem those shares of the Series, and shares of other
preferred stock which it was unable to redeem, on the earliest practicable date
on which the Corporation will have such funds available, upon notice pursuant to
Section 3(b) to record owners of shares of the Series to be redeemed and the
Paying Agent. The Corporation will deposit with the Paying Agent funds
sufficient to redeem the specified number of shares of the Series with respect
to a redemption required under subparagraph (a)(ii) of this Section 3, by
1:00 P.M., New York City time, of the

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Business Day immediately preceding the Mandatory Redemption Date. If fewer than
all of the Outstanding shares of the Series are to be redeemed pursuant to this
Section 3(a)(iii), the number of shares to be redeemed will be redeemed pro rata
from the Holders of such shares in proportion to the number of the shares of the
Series held by such Holders, by lot or by such other method as the Corporation
will deem fair and equitable, subject, however, to the terms of any applicable
Specific Redemption Provisions. 'Mandatory Redemption Price' means the
Redemption Price plus (in the case of a Dividend Period of one year or more
only) a redemption premium, if any, determined by the Board of Directors after
consultation with the Broker-Dealers and set forth in any applicable Specific
Redemption Provisions.

    (b) In the event of a redemption pursuant to the foregoing Section 3(a), the
Corporation will file a notice of its intention to redeem with the Securities
and Exchange Commission so as to provide at least the minimum notice required
under Rule 23c-2 under the 1940 Act or any successor provision. In addition, the
Corporation will deliver a notice of redemption to the Auction Agent (the
'Notice of Redemption') containing the information set forth below (i) in the
case of an optional redemption pursuant to Section 3(a)(i) above, one Business
Day prior to the giving of notice to the Holders, (ii) in the case of a
mandatory redemption pursuant to Section 3(a)(ii) above, on or prior to the
10th day preceding the Mandatory Redemption Date. Only with respect to shares
held by the Securities Depository, the Auction Agent will use its reasonable
efforts to provide telephonic notice to each Holder of shares of the Series
called for redemption not later than the close of business on the Business Day
immediately following the day on which the Auction Agent determines the shares
to be redeemed (or, during a Default Period with respect to such shares, not
later than the close of business on the Business Day immediately following the
day on which the Auction Agent receives Notice of Redemption from the
Corporation). The Auction Agent will confirm such telephonic notice in writing
not later than the close of business on the third Business Day preceding the
date fixed for redemption by providing the Notice of Redemption to each Holder
of shares called for redemption, the Paying Agent (if different from the Auction
Agent) and the Securities Depository. Notice of Redemption will be addressed to
the registered owners of shares of the Series at their addresses appearing on
the share records of the Corporation. Such Notice of Redemption will set forth
(i) the date fixed for redemption, (ii) the number and identity of shares of the
Series to be redeemed, (iii) the redemption price (specifying the amount of
accumulated dividends to be included therein), (iv) that dividends on the shares
to be redeemed will cease to accumulate on such date fixed for redemption, and
(v) the provision under which redemption will be made. No defect in the Notice
of Redemption or in the transmittal or mailing thereof will affect the validity
of the redemption proceedings, except as required by applicable law. If fewer
than all shares held by any Holder are to be redeemed, the Notice of Redemption
mailed to such Holder will also specify the number of shares to be redeemed from
such Holder.

    (c) Notwithstanding the provisions of paragraph (a) of this Section 3, no
preferred stock, including the Series, may be redeemed at the option of the
Corporation unless all dividends in arrears on the Outstanding shares of the
Series and any other preferred stock have been or are being contemporaneously
paid or set aside for payment; provided, however, that the foregoing will not
prevent the purchase or acquisition of outstanding shares of preferred stock
pursuant to the successful completion of an otherwise lawful purchase or
exchange offer made on the same terms to holders of all outstanding shares of
preferred stock.

    (d) Upon the deposit of funds sufficient to redeem shares of the Series with
the Paying Agent and the giving of the Notice of Redemption to the Auction Agent
under paragraph (b) of this Section 3, dividends on such shares will cease to
accumulate and such shares will no longer be deemed to be Outstanding for any
purpose (including, without limitation, for purposes of calculating whether the
Corporation has met the Preferred Shares Basic Maintenance Amount Test or the
1940 Act Preferred Shares Asset Coverage), and all rights of the Holders of the
shares so called for redemption will cease and terminate, except the right of
such Holder to receive the redemption price specified herein, but without any
interest or other additional amount. Such redemption price will be paid by the
Paying Agent to the nominee of the Securities Depository. The Corporation will
be entitled to receive from the Paying Agent, promptly after the date fixed

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for redemption, any cash deposited with the Paying Agent in excess of (i) the
aggregate redemption price of the shares of the Series called for redemption on
such date and (ii) such other amounts, if any, to which Holders of shares of the
Series called for redemption may be entitled. Any funds so deposited that are
unclaimed at the end of two years from such redemption date will, to the extent
permitted by law, be paid to the Corporation, after which time the Holders of
shares of the Series so called for redemption may look only to the Corporation
for payment of the redemption price and all other amounts, if any, to which they
may be entitled; provided, however, that the Paying Agent will notify all
Holders whose funds are unclaimed by placing a notice in The Wall Street Journal
concerning the availability of such funds once each week for three consecutive
weeks. The Corporation will be entitled to receive, from time to time after the
date fixed for redemption, any interest earned on the funds so deposited.

    (e) To the extent that any redemption for which Notice of Redemption has
been given is not made by reason of the absence of legally available funds
therefor, or is otherwise prohibited, such redemption will be made as soon as
practicable to the extent such funds become legally available or such redemption
is no longer otherwise prohibited. Failure to redeem shares of the Series will
be deemed to exist at any time after the date specified for redemption in a
Notice of Redemption when the Corporation will have failed, for any reason
whatsoever, to deposit in trust with the Paying Agent the redemption price with
respect to any shares for which such Notice of Redemption has been given.
Notwithstanding the fact that the Corporation may not have redeemed shares of
the Series for which a Notice of Redemption has been given, dividends may be
declared and paid on shares of the Series and will include those shares of the
Series for which Notice of Redemption has been given but for which deposit of
funds has not been made.

    (f) All moneys paid to the Paying Agent for payment of the redemption price
of shares of the Series called for redemption will be held in trust by the
Paying Agent for the benefit of holders of shares so to be redeemed.

    (g) So long as any shares of the Series are held of record by the nominee of
the Securities Depository, the redemption price for such shares will be paid on
the date fixed for redemption to the nominee of the Securities Depository for
distribution to Agent Members for distribution to the persons for whom they are
acting as agent.

    (h) Except for the provisions described above, nothing contained in these
Articles Supplementary limits any right of the Corporation to purchase or
otherwise acquire any shares of the Series outside of an Auction at any price,
whether higher or lower than the price that would be paid in connection with an
optional or mandatory redemption, so long as, at the time of any such purchase,
there is no arrearage in the payment of dividends on, or the mandatory or
optional redemption price with respect to, any shares of the Series for which
Notice of Redemption has been given and the Corporation meets the 1940 Act
Preferred Shares Asset Coverage and the Preferred Shares Basic Maintenance
Amount Test after giving effect to such purchase or acquisition on the date
thereof. Any shares which are purchased, redeemed or otherwise acquired by the
Corporation will have no voting rights. If fewer than all the Outstanding shares
of the Series are redeemed or otherwise acquired by the Corporation, the
Corporation will give notice of such transaction to the Auction Agent, in
accordance with the procedures agreed upon by the Board of Directors.

    (i) In the case of any redemption pursuant to this Section 3, only whole
shares of the Series will be redeemed, and in the event that any provision of
the Charter would require redemption of a fractional share, the Auction Agent
will be authorized to round up so that only whole shares are redeemed.

    (j) Notwithstanding anything herein to the contrary, including, without
limitation, Section 6(k) of Part I of these Articles Supplementary, the Board of
Directors, upon notification to each Rating Agency, may authorize, create or
issue other series of preferred stock, including other series of AMPS, ranking
on a parity with the Series with respect to the payment of dividends or the
distribution of assets upon dissolution, liquidation or winding up of the
affairs of the Corporation, to the extent permitted by the 1940 Act, if upon
issuance of any such series, either (A) the net proceeds from the sale of such
stock (or such portion thereof needed to redeem or repurchase the

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Outstanding Series) are deposited with the Paying Agent in accordance with
Section 3(d) of Part I of these Articles Supplementary, Notice of Redemption as
contemplated by Section 3(b) of Part I of these Articles Supplementary has been
delivered prior thereto or is sent promptly thereafter, and such proceeds are
used to redeem all Outstanding shares of the Series or (B) the Corporation would
meet the 1940 Act Preferred Shares Asset Coverage, the Preferred Shares Basic
Maintenance Amount Test and the requirements of Section 12(b) of Part I of these
Articles Supplementary.

    4. Designation of Dividend Period.

    (a) The initial Dividend Period for the Series will be as determined in the
manner set forth under 'Designation' above. The Corporation will designate the
duration of subsequent Dividend Periods of the Series; provided, however, that
no such designation is necessary for a Standard Dividend Period and, provided
further, that any designation of a Special Dividend Period will be effective
only if (i) notice thereof will have been given as provided herein, (ii) any
failure to pay in a timely manner to the Auction Agent the full amount of any
dividend on, or the redemption price of, the Series will have been cured as
provided above, (iii) Sufficient Clearing Orders will have existed in an Auction
held on the Auction Date immediately preceding the first day of such proposed
Special Dividend Period, (iv) if the Corporation will have mailed a Notice of
Redemption with respect to any shares and the redemption price with respect to
such shares will have been deposited with the Paying Agent, (v) in the case of
the designation of a Special Dividend Period, the Broker-Dealers will have
notified the Corporation in writing that it believes the Auction for the Special
Dividend Period will be successful, and (vi) each Rating Agency will have
confirmed in writing to the Corporation that such designation will not adversely
affect their respective then-current ratings of the Series.

    (b) If the Corporation proposes to designate any Special Dividend Period,
not fewer than seven Business Days (or two Business Days in the event the
duration of the Dividend Period prior to such Special Dividend Period is fewer
than eight days) nor more than 30 Business Days prior to the first day of
such Special Dividend Period, notice will be (i) made by press release and
communicated by the Corporation by telephonic or other means to the Auction
Agent and each Broker-Dealer and confirmed in writing promptly thereafter. Each
such notice will state (A) that the Corporation proposes to exercise its option
to designate a succeeding Special Dividend Period, specifying the first and last
days thereof and the Maximum Applicable Rate for such Special Dividend Period
and (B) that the Corporation will by 3:00 P.M., New York City time, on the
second Business Day next preceding the first day of such Special Dividend
Period, notify the Auction Agent, who will promptly notify the Broker-Dealers,
of either (x) its determination, subject to certain conditions, to proceed with
such Special Dividend Period, subject to the terms of any Specific Redemption
Provisions, or (y) its determination not to proceed with such Special Dividend
Period, in which latter event the succeeding Dividend Period will be a Standard
Dividend Period. No later than 3:00 P.M., New York City time, on the second
Business Day next preceding the first day of any proposed Special Dividend
Period, the Corporation will deliver to the Auction Agent, who will promptly
deliver to the Broker-Dealers and Existing Holders, either:

        (i) a notice stating (A) that the Corporation has determined to
    designate the next succeeding Dividend Period as a Special Dividend Period,
    specifying the first and last days thereof and (B) the terms of any Specific
    Redemption Provisions; or

        (ii) a notice stating that the Corporation has determined not to
    exercise its option to designate a Special Dividend Period.

    If the Corporation fails to deliver either such notice with respect to any
designation of any proposed Special Dividend Period to the Auction Agent or is
unable to make the confirmation provided in clause (v) of paragraph (a) of this
Section 4 by 3:00 P.M., New York City time, on the second Business Day next
preceding the first day of such proposed Special Dividend Period, the
Corporation will be deemed to have delivered a notice to the Auction Agent with
respect to such Dividend Period to the effect set forth in clause (ii) above,
thereby resulting in a Standard Dividend Period.

                                      B-8





<PAGE>



    5. Restrictions on Transfer. Shares of the Series may be transferred only
(a) pursuant to an order placed in an Auction, (b) to or through a Broker-Dealer
or (c) to the Corporation or any Affiliate. Notwithstanding the foregoing, a
transfer other than pursuant to an Auction will not be effective unless the
selling Existing Holder or the Agent Member of such Existing Holder, in the case
of an Existing Holder whose shares are listed in its own name on the books of
the Auction Agent, or the Broker-Dealer or Agent Member of such Broker-Dealer,
in the case of a transfer between persons holding shares of the Series through
different Broker-Dealers, advises the Auction Agent of such transfer. The
certificates representing the shares of the Series issued to the Securities
Depository will bear legends with respect to the restrictions described above
and stop-transfer instructions will be issued to the Transfer Agent and/or
Registrar.

    6. Voting Rights.

    (a) Except as otherwise provided in the Charter or as otherwise required by
applicable law, (i) each Holder of shares of the Series will be entitled to one
vote for each share of the Series held on each matter on which the Holders of
the Series are entitled to vote, and (ii) the holders of the Outstanding shares
of preferred stock, including the Series, and holders of shares of Common
Shares will vote together as a single class on all matters submitted to the
stockholders; provided, however, that, with respect to the election of
directors, the holders of the Outstanding shares of preferred stock, including
the Series, represented in person or by proxy at a meeting for the election of
directors, will be entitled, as a class, to the exclusion of the holders of all
other securities and classes of capital stock, including the Common Shares, to
elect two directors of the Corporation, each share of preferred stock, including
the Series, entitling the holder thereof to one vote. The identities of the
nominees of such directorships may be fixed by the Board of Directors. Subject
to paragraph (b) of this Section 6, the holders of outstanding shares of Common
Shares and outstanding shares of preferred stock, including the Series, voting
together as a single class, will be entitled to elect the balance of the
directors.

    (b) If at any time dividends on the Series will be unpaid in an amount equal
to two full years' dividends on the Series (a 'Voting Period'), the number of
directors constituting the Board of Directors will be automatically increased by
the smallest number of additional directors that, when added to the number of
directors then constituting the Board of Directors, will (together with the two
directors elected by the holders of preferred stock, including the Series,
pursuant to paragraph (a) of this Section 6) constitute a majority of such
increased number, and the holders of any shares of preferred stock, including
the Series, will be entitled, voting as a single class on a one-vote-per-share
basis (to the exclusion of the holders of all other securities and classes of
capital stock of the Corporation), to elect the smallest number of such
additional directors of the Corporation that will constitute a majority of the
total number of directors of the Corporation so increased. The Voting Period and
the voting rights so created upon the occurrence of the conditions set forth in
this paragraph (b) of Section 6 will continue unless and until all dividends in
arrears on the Series will have been paid or declared and sufficient cash or
specified securities are set apart for the payment of such dividends. Upon the
termination of a Voting Period, the voting rights described in this paragraph
(b) of Section 6 will cease, subject always, however, to the revesting of such
voting rights in the holders of preferred stock, including the Series, upon the
further occurrence of any of the events described in this paragraph (b) of
Section 6.

    (c) As soon as practicable after the accrual of any right of the holders of
shares of preferred stock, including the Series, to elect additional directors
as described in paragraph (b) of this Section 6, the Corporation will notify the
Auction Agent, and the Auction Agent will call a special meeting of such
holders, by mailing a notice of such special meeting to such holders, such
meeting to be held not less than ten nor more than 90 days after the date of
mailing of such notice. If the Corporation fails to send such notice to the
Auction Agent or if the Auction Agent does not call such a special meeting, it
may be called by any such holder on like notice. The record date for determining
the holders entitled to notice of and to vote at such special meeting will be
the close of business on the fifth Business Day preceding the day on which such
notice is mailed. At any such special meeting and at each meeting of holders of
preferred stock, including the Series, held during a Voting Period at which
directors are to be elected, such holders, voting

                                      B-9





<PAGE>



together as a class (to the exclusion of the holders of all other securities and
classes of capital stock of the Corporation), will be entitled to elect the
number of directors prescribed in paragraph (b) of this Section 6 on a
one-vote-per-share basis. At any such meeting or adjournment thereof in the
absence of a quorum, a majority of the holders of shares of preferred stock,
including Holders of the Series, present in person or by proxy will have the
power to adjourn the meeting without notice, other than an announcement at the
meeting, until a quorum is present.

    (d) For purposes of determining any rights of the holders of the shares of
preferred stock, including the Series, to vote on any matter, whether such right
is created by these Articles Supplementary, by statute or otherwise, if
redemption of some or all of the shares of preferred stock, including the
Series, is required, no holder of shares of preferred stock, including the
Series, will be entitled to vote and no share of preferred stock, including the
Series, will be deemed to be 'outstanding' for the purpose of voting or
determining the number of shares required to constitute a quorum, if prior to or
concurrently with the time of determination, sufficient Deposit Securities for
the redemption of such shares have been deposited in the case of the Series in
trust with the Paying Agent for that purpose and the requisite Notice of
Redemption with respect to such shares will have been given as provided in
Section 3(b) of Part I of these Articles Supplementary and in the case of other
preferred stock the Corporation has otherwise met the conditions for redemption
applicable to such shares.

    (e) The terms of office of all persons who are directors of the Corporation
at the time of a special meeting of Holders of the Series and holders of other
shares of preferred stock to elect directors pursuant to paragraph (b) of this
Section 6 will continue, notwithstanding the election at such meeting by the
holders of the number of directors that they are entitled to elect.

    (f) Simultaneously with the termination of a Voting Period, the terms of
office of the additional directors elected by the Holders of the Series and
holders of shares of other preferred stock pursuant to paragraph (b) of this
Section 6 will terminate, the remaining directors will constitute the directors
of the Corporation and the voting rights of such holders to elect additional
directors pursuant to paragraph (b) of this Section 6 will cease, subject to the
provisions of the last sentence of paragraph (b) of this Section 6.

    (g) Unless otherwise required by law or in the Corporation's Charter, the
Holders of the Series will not have any relative rights or preferences or other
special rights other than those specifically set forth herein. In the event that
the Corporation fails to pay any dividends on the Series of the Corporation or
fails to redeem any shares of the Series which it is required to redeem, or any
other event occurs which requires the mandatory redemption of the Series and the
required Notice of Redemption has not been given, other than the rights set
forth in paragraph (a) of Section 3 of Part I of these Articles Supplementary,
the exclusive remedy of the Holders of the Series will be the right to vote for
directors pursuant to the provisions of paragraph (b) of this Section 6. In no
event will the Holders of the Series have any right to sue for, or bring a
proceeding with respect to, such dividends or redemptions or damages for the
failure to receive the same.

    (h) For so long as any shares of preferred stock, including the Series, are
outstanding, the Corporation will not, without the affirmative vote of the
Holders of a majority of the outstanding preferred stock, including the Series,
(i) institute any proceedings to be adjudicated bankrupt or insolvent, or
consent to the institution of bankruptcy or insolvency proceedings against it,
or file a petition seeking or consenting to reorganization or relief under any
applicable federal or state law relating to bankruptcy or insolvency, or consent
to the appointment of a receiver, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Corporation or a substantial part of its
property, or make any assignment for the benefit of creditors, or, except as may
be required by applicable law, admit in writing its inability to pay its debts
generally as they become due or take any corporate action in furtherance of any
such action; (ii) create, incur or suffer to exist, or agree to create, incur or
suffer to exist, or consent to cause or permit in the future (upon the happening
of a contingency or otherwise) the creation, incurrence or existence of any
material lien, mortgage, pledge, charge, security interest, security agreement,
conditional sale or trust receipt or other material encumbrance of any kind upon
any of the Corporation's assets as a whole, except

                                      B-10





<PAGE>



(A) liens the validity of which are being contested in good faith by appropriate
proceedings, (B) liens for taxes that are not then due and payable or that can
be paid thereafter without penalty, (C) liens, pledges, charges, security
interests, security agreements or other encumbrances arising in connection with
any indebtedness senior to the Series, (D) liens, pledges, charges, security
interests, security agreements or other encumbrances arising in connection with
any indebtedness permitted under clause (iii) below and (E) liens to secure
payment for services rendered including, without limitation, services rendered
by the Corporation's Paying Agent and the Auction Agent; or (iii) create,
authorize, issue, incur or suffer to exist any indebtedness for borrowed money
or any direct or indirect guarantee of such indebtedness for borrowed money or
any direct or indirect guarantee of such indebtedness, except the Corporation
may borrow as may be permitted by the Corporation's investment restrictions;
provided, however, that transfers of assets by the Corporation subject to an
obligation to repurchase will not be deemed to be indebtedness for purposes of
this provision to the extent that after any such transaction the Corporation has
Eligible Assets with an aggregate Discounted Value at least equal to the
Preferred Shares Basic Maintenance Amount as of the immediately preceding
Valuation Date.

    (i) The affirmative vote of the holders of a majority, as defined in the
1940 Act, of the outstanding shares of preferred stock, including the Series,
voting together as a separate class, will be required to approve any plan of
reorganization (as such term is used in the 1940 Act) adversely affecting such
shares or any action requiring a vote of security holders of the Corporation
under Section 13(a) of the 1940 Act. In the event a vote of holders of shares of
preferred stock is required pursuant to the provisions of Section 13(a) of the
1940 Act, the Corporation will, not later than ten Business Days prior to the
date on which such vote is to be taken, notify each Rating Agency that such vote
is to be taken and the nature of the action with respect to which such vote is
to be taken and will, not later than ten Business Days after the date on which
such vote is taken, notify each Rating Agency of the results of such vote.

    (j) The affirmative vote of the Holders of a majority, as defined in the
1940 Act, of the outstanding shares of preferred stock of any series, voting
separately from any other series, will be required with respect to any matter
that materially and adversely affects the rights, preferences, or powers of that
series in a manner different from that of other series or classes of the
Corporation's shares of capital stock. For purposes of the foregoing, no matter
will be deemed to adversely affect any rights, preference or power unless such
matter (i) alters or abolishes any preferential right of such series;
(ii) creates, alters or abolishes any right in respect of redemption of such
series; or (iii) creates or alters (other than to abolish) any restriction on
transfer applicable to such series. The vote of holders of any series described
in this Section (j) will in each case be in addition to a separate vote of the
requisite percentage of Common Shares and/or preferred stock necessary to
authorize the action in question.

    (k) The Board of Directors, without the vote or consent of any holder of
shares of preferred stock, including the Series, or any other stockholder of the
Corporation, may from time to time amend, alter or repeal any or all of the
definitions contained herein, add covenants and other obligations of the
Corporation, or confirm the applicability of covenants and other obligations set
forth herein, all in connection with obtaining or maintaining the rating of any
Rating Agency with respect to the Series, and any such amendment, alteration or
repeal will not be deemed to affect the preferences, rights or powers of the
Series or the Holders thereof, provided that the Board of Directors receives
written confirmation from each relevant Rating Agency (with such confirmation in
no event being required to be obtained from a particular Rating Agency with
respect to definitions or other provisions relevant only to and adopted in
connection with another Rating Agency's rating of the the Series) that any such
amendment, alteration or repeal would not adversely affect the rating then
assigned by such Rating Agency.

    In addition, subject to compliance with applicable law, the Board of
Directors may amend the definition of Maximum Rate to increase the percentage
amount by which the Reference Rate is multiplied to determine the Maximum Rate
shown therein without the vote or consent of the holders of shares of preferred
stock, including the Series, or any other stockholder of the Corporation, but
only with confirmation from each Rating Agency, and after consultation with the

                                      B-11





<PAGE>



Broker-Dealers, provided that immediately following any such increase the
Corporation would meet the Preferred Shares Basic Maintenance Amount Test.

    7. Liquidation Rights.

    (a) In the event of any liquidation, dissolution or winding up of the
affairs of the Corporation, whether voluntary or involuntary, the holders of
shares of preferred stock, including the Series, will be entitled to receive out
of the assets of the Corporation available for distribution to stockholders,
after claims of creditors but before distribution or payment will be made in
respect of the Common Shares or to any other shares of stock of the Corporation
ranking junior to the preferred stock, as to liquidation payments, a liquidation
distribution in the amount of $25,000 per share (the 'Liquidation Preference'),
plus an amount equal to all unpaid dividends accrued to and including the date
fixed for such distribution or payment (whether or not declared by the Board of
Directors, but excluding interest thereon), but such Holders will be entitled to
no further participation in any distribution or payment in connection with any
such liquidation, dissolution or winding up. The Series will rank on a parity
with shares of any other series of preferred stock of the Corporation as to the
distribution of assets upon dissolution, liquidation or winding up of the
affairs of the Corporation.

    (b) If, upon any such liquidation, dissolution or winding up of the affairs
of the Corporation, whether voluntary or involuntary, the assets of the
Corporation available for distribution among the holders of all outstanding
shares of preferred stock, including the Series, will be insufficient to permit
the payment in full to such holders of the amounts to which they are entitled,
then such available assets will be distributed among the holders of all
outstanding shares of preferred stock, including the Series, ratably in any such
distribution of assets according to the respective amounts which would be
payable on all such shares if all amounts thereon were paid in full. Unless and
until payment in full has been made to the holders of all outstanding shares of
preferred stock, including the Series, of the liquidation distributions to which
they are entitled, no dividends or distributions will be made to holders of
Common Shares or any stock of the Corporation ranking junior to the preferred
stock as to liquidation.

    (c) Neither the consolidation nor merger of the Corporation with or into any
other entity or entities, nor the sale, lease, exchange or transfer by the
Corporation of all or substantially all of its property and assets, will be
deemed to be a liquidation, dissolution or winding up of the Corporation for
purposes of this Section 7.

    (d) After the payment to Holders of the Series of the full preferential
amounts provided for in this Section 7, the Holders of the Series as such will
have no right or claim to any of the remaining assets of the Corporation.

    (e) In the event the assets of the Corporation or proceeds thereof available
for distribution to the Holders of the Series, upon dissolution, liquidation or
winding up of the affairs of the Corporation, whether voluntary or involuntary,
will be insufficient to pay in full all amounts to which such Holders are
entitled pursuant to paragraph (a) of this Section 7, no such distribution will
be made on account of any shares of any other series of preferred stock unless
proportionate distributive amounts will be paid on account of the Series,
ratably, in proportion to the full distributable amounts to which holders of all
shares of preferred stock are entitled upon such dissolution, liquidation or
winding up.

    (f) Subject to the rights of the holders of shares of other preferred stock
or after payment will have been made in full to the Holders of the Series as
provided in paragraph (a) of this Section 7, but not prior thereto, any other
series or class of shares ranking junior to the Series with respect to the
distribution of assets upon dissolution, liquidation or winding up of the
affairs of the Corporation will, subject to any respective terms and provisions
(if any) applying thereto, be entitled to receive any and all assets remaining
to be paid or distributed, and the Holders of the Series will not be entitled to
share therein.

    8. Auction Agent. For so long as any shares of the Series are Outstanding,
the Auction Agent, duly appointed by the Corporation to so act, will be in each
case a commercial bank, trust company or other financial institution independent
of the Corporation and its Affiliates (which,

                                      B-12





<PAGE>



however, may engage or have engaged in business transactions with the
Corporation or its Affiliates) and at no time will the Corporation or any of its
Affiliates act as the Auction Agent in connection with the Auction Procedures.
If the Auction Agent resigns or for any reason its appointment is terminated
during any period that any shares of the Series are Outstanding, the Corporation
will use its best efforts to enter into an agreement with a successor auction
agent containing substantially the same terms and conditions as the auction
agency agreement. The Corporation may remove the auction agent provided that
prior to such removal the Corporation will have entered into such an agreement
with a successor auction agent.

    9. 1940 Act Preferred Shares Asset Coverage. The Corporation will maintain,
as of the last Business Day of each month in which any shares of the Series are
Outstanding, the 1940 Act Preferred Shares Asset Coverage; provided, however,
that Section 3(a)(ii) will be the sole remedy in the event the Corporation fails
to do so.

    10. Preferred Shares Basic Maintenance Amount. So long as any shares of the
Series are Outstanding and any Rating Agency so requires, the Corporation will
maintain, as of each Valuation Date, Moody's Eligible Assets and S&P Eligible
Assets, as applicable, having an aggregate Discounted Value equal to or greater
than the Preferred Shares Basic Maintenance Amount; provided, however, that
Section 3(a)(ii) will be the sole remedy in the event the Corporation fails to
do so.

    11. Certain Other Restrictions. So long as any shares of the Series are
Outstanding and S&P, Moody's or any Other Rating Agency that is rating such
shares so requires, the Corporation will not, unless it has received written
confirmation from S&P (if S&P is then rating the Series), Moody's (if Moody's is
then rating the Series) and (if applicable) such Other Rating Agency, that any
such action would not impair the rating then assigned by such Rating Agency to
the Series, engage in any one or more of the following transactions:

        (a) purchase or sell futures contracts or options thereon with respect
    to portfolio securities or write put or call options on portfolio
    securities;

        (b) except in connection with a refinancing of the Series, issue
    additional shares of any series of preferred stock, including the Series or
    reissue any shares of preferred stock, including the Series previously
    purchased or redeemed by the Corporation;

        (c) engage in any short sales of securities;

        (d) lend portfolio securities;

        (e) merge or consolidate into or with any other fund; or

        (f) for purposes of valuation of Moody's Eligible Assets: (A) if the
    Corporation writes a call option, the underlying asset will be valued as
    follows: (1) if the option is exchange-traded and may be offset readily or
    if the option expires before the earliest possible redemption of the Series,
    at the lower of the Discounted Value of the underlying security of the
    option and the exercise price of the option or (2) otherwise, it has no
    value; (B) if the Corporation writes a put option, the underlying asset will
    be valued as follows: the lesser of (1) exercise price and (2) the
    Discounted Value of the underlying security; and (C) call or put option
    contracts which the Corporation buys have no value. For so long as the
    Series are rated by Moody's: (A) the Corporation will not engage in options
    transactions for leveraging or speculative purposes; (B) the Corporation
    will not write or sell any anticipatory contracts pursuant to which the
    Corporation hedges the anticipated purchase of an asset prior to completion
    of such purchase; (C) the Corporation will not enter into an option
    transaction with respect to portfolio securities unless, after giving effect
    thereto, the Corporation would continue to have Eligible Assets with an
    aggregate Discounted Value equal to or greater than the Preferred Shares
    Basic Maintenance Amount; (D) the Corporation will not enter into an option
    transaction with respect to portfolio securities unless after giving effect
    to such transaction the Corporation would continue to be in compliance with
    the provisions relating to the Preferred Shares Basic Maintenance Amount;
    (E) for purposes of the Preferred Shares Basic Maintenance Amount assets in
    margin accounts are not Eligible Assets; (F) the Corporation will write only
    exchange-traded options on exchanges approved by Moody's (if Moody's is then

                                      B-13





<PAGE>



    rating the Series); (G) where delivery may be made to the Corporation with
    any of a class of securities, the Corporation will assume for purposes of
    the Preferred Shares Basic Maintenance Amount that it takes delivery of that
    security which yields it the least value; (H) the Corporation will not
    engage in forward contracts; and (I) there will be a quarterly audit made of
    the Corporation's options transactions by the Corporation's independent
    auditors to confirm that the Corporation is in compliance with these
    standards.

        (g) For so long as the Series is rated by S&P, the Corporation will not
    purchase or sell futures contracts, write, purchase or sell options on
    futures contracts or write put options (except covered put options) or call
    options (except covered call options) on portfolio securities unless it
    receives written confirmation from S&P that engaging in such transactions
    will not impair the ratings then assigned to the Series by S&P.

    12. Compliance Procedures for Asset Maintenance Tests. For so long as any
shares of the Series are Outstanding and any Rating Agency so requires:

        (a) As of each Valuation Date, the Corporation will determine (i) the
    Market Value of each Eligible Asset owned by the Corporation on that date,
    (ii) the Discounted Value of each such Eligible Asset, (iii) whether the
    Preferred Shares Basic Maintenance Amount Test is met as of that date,
    (iv) the value (as used in the 1940 Act) of the total assets of the
    Corporation, less all liabilities, and (v) whether the 1940 Act Preferred
    Shares Asset Coverage is met as of that date.

        (b) Upon any failure to meet the Preferred Shares Basic Maintenance
    Amount Test or 1940 Act Preferred Shares Asset Coverage on any Valuation
    Date, the Corporation may use reasonable commercial efforts (including,
    without limitation, altering the composition of its portfolio, purchasing
    shares of the Series outside of an Auction or, in the event of a failure to
    file a certificate on a timely basis, submitting the requisite certificate),
    to meet (or certify in the case of a failure to file a certificate on a
    timely basis, as the case may be) the Preferred Shares Basic Maintenance
    Amount Test or 1940 Act Preferred Shares Asset Coverage on or prior to the
    Asset Coverage Cure Date.

        (c) Compliance with the Preferred Shares Basic Maintenance Amount and
    1940 Act Asset Coverage Tests will be determined with reference to those
    shares of the Series which are deemed to be Outstanding hereunder.

        (d) In the case of the asset coverage requirements for Moody's and S&P,
    the auditors must certify once per calendar year the asset coverage test on
    a date randomly selected by the auditor.

        (e) The Corporation will deliver to the Auction Agent and each Rating
    Agency a certificate which sets forth a determination of items (i)-(iii) of
    paragraph (a) of this Section 12 (a 'Preferred Shares Basic Maintenance
    Certificate') as of (A) the Date of Original Issue, (B) the last Valuation
    Date of each month, (C) any date requested by any Rating Agency, (D) a
    Business Day on or before any Asset Coverage Cure Date relating to the
    Corporation's cure of a failure to meet the Preferred Shares Basic
    Maintenance Amount Test, (E) any day that Common Shares outstanding ,
    preferred shares of the Fund, including the Series, are redeemed and
    (F) any day the S&P Eligible Assets have an aggregate discounted value less
    than or equal to 110% of the Preferred Shares Basic Maintenance Amount. Such
    Preferred Shares Basic Maintenance Certificate will be delivered in the case
    of clause (i)(A) on the Date of Original Issue and in the case of all other
    clauses above on or before the seventh Business Day after the relevant
    Valuation Date or Asset Coverage Cure Date.

        (f) The Corporation will deliver to the Auction Agent and each Rating
    Agency a certificate which sets forth a determination of items (iv) and (v)
    of paragraph (a) of this Section 12 (a '1940 Act Preferred Shares Asset
    Coverage Certificate') (i) as of the Date of Original Issue, and (ii) as of
    (A) the last Valuation Date of each quarter thereafter, and (B) as of a
    Business Day on or before any Asset Coverage Cure Date relating to the
    failure to meet the 1940 Act Preferred Shares Asset Coverage. Such 1940 Act
    Preferred Shares Asset Coverage Certificate will be delivered in the case of
    clause (i) on the Date of Original Issue

                                      B-14





<PAGE>


    and in the case of clause (ii) on or before the seventh Business Day
    after the relevant Valuation Date or the Asset Coverage Cure Date. The
    certificates required by paragraphs (d) and (e) of this Section 12 may be
    combined into a single certificate.

        (g) Within ten Business Days of the Date of Original Issue, the
    Corporation will deliver to the Auction Agent and each Rating Agency a
    letter prepared by the Corporation's independent auditors (an 'Auditor's
    Certificate') regarding the accuracy of the calculations made by the
    Corporation in the Preferred Shares Basic Maintenance Certificate and the
    1940 Act Preferred Shares Asset Coverage Certificate required to be
    delivered by the Corporation on the Date of Original Issue. Within ten
    Business Days after delivery of the Preferred Shares Basic Maintenance
    Certificate and the 1940 Act Preferred Shares Asset Coverage Certificate
    relating to the last Valuation Date of each fiscal quarter of the
    Corporation, the Corporation will deliver to the Auction Agent and each
    Rating Agency an Auditor's Certificate regarding the accuracy of the
    calculations made by the Corporation in a Preferred Shares Basic Maintenance
    Certificate with respect to a date randomly selected by the Corporation's
    independent auditors during such fiscal quarter. In addition, the
    Corporation will deliver to the persons specified in the preceding sentence
    an Auditor's Certificate regarding the accuracy of the calculations made by
    the Corporation on each Preferred Shares Basic Maintenance Certificate and
    1940 Act Preferred Shares Asset Coverage Certificate delivered in relation
    to an Asset Coverage Cure Date within ten days after the relevant Asset
    Coverage Cure Date. If an Auditor's Certificate shows that an error was made
    in any such report, the calculation or determination made by the
    Corporation's independent auditors will be conclusive and binding on the
    Corporation.

        (h) The Auditor's Certificates referred to in paragraph (f) above will
    confirm, based upon the independent auditor's review of portfolio data
    provided by the Corporation, (i) the mathematical accuracy of the
    calculations reflected in the related Preferred Shares Basic Maintenance
    Amount Certificates and 1940 Act Preferred Shares Asset Coverage
    Certificates and (ii) that, based upon such calculations, the Corporation
    had, at such Valuation Date, met the Preferred Shares Basic Maintenance
    Amount Test.

        (i) In the event that a Preferred Shares Basic Maintenance Certificate
    or 1940 Act Preferred Shares Asset Coverage Certificate with respect to an
    applicable Valuation Date is not delivered within the time periods specified
    in this Section 12, the Corporation will be deemed to have failed to meet
    the Preferred Shares Basic Maintenance Amount Test or the 1940 Act Preferred
    Shares Asset Coverage, as the case may be, on such Valuation Date for
    purposes of Section 12(b) of Part I of these Articles Supplementary. In the
    event that a Preferred Shares Basic Maintenance Certificate, a 1940 Act
    Preferred Shares Asset Coverage Certificate or an applicable Auditor's
    Certificate with respect to an Asset Coverage Cure Date is not delivered
    within the time periods specified herein, the Corporation will be deemed to
    have failed to meet the Preferred Shares Basic Maintenance Amount Test or
    the 1940 Preferred Shares Asset Coverage, as the case may be, as of the
    related Valuation Date.

    13. Notice. All notices or communications hereunder, unless otherwise
specified in these Articles Supplementary, will be sufficiently given if in
writing and delivered in person, by telecopier or mailed by first-class mail,
postage prepaid. Notices delivered pursuant to this Section 13 will be deemed
given on the earlier of the date received or the date five-days after which such
notice is mailed, except as otherwise provided in these Articles Supplementary
or by the MGCL for notices of stockholders' meetings.

    14. Waiver. To the extent permitted by Maryland law, Holders of at least
two-thirds of the Outstanding shares of the Series may waive any provision
hereof intended for their benefit in accordance with such procedures as may from
time to time be established by the Board of Directors.

    15. Termination. In the event that no shares of the Series are Outstanding,
all rights and preferences of such shares established and designated hereunder
will cease and terminate, and all obligations of the Corporation under these
Articles Supplementary will terminate.

                                      B-15





<PAGE>


    16. Amendment. Subject to the provisions of these Articles Supplementary,
the Board of Directors may, by resolution duly adopted without stockholder
approval (except as otherwise provided by these Articles Supplementary or
required by applicable law), amend these Articles Supplementary to reflect any
amendments hereto which the Board of Directors is entitled to adopt pursuant to
the terms of Section 6(k) of Part I of these Articles Supplementary without
stockholder approval. To the extent permitted by applicable law, the Board of
Directors may interpret, amend or adjust the provisions of these Articles
Supplementary to resolve any inconsistency or ambiguity or to remedy any patent
defect.

    17. Definitions. As used in Part I and Part II of these Articles
Supplementary, the following terms will have the following meanings (with terms
defined in the singular having comparable meanings when used in the plural and
vice versa), unless the context otherwise requires:

        'AA' Composite Commercial Paper Rate' on any date means (i) the interest
    equivalent of the 7-day rate, in the case of a Dividend Period which is 7
    days or shorter; for Dividend Periods greater than 7 days but fewer than or
    equal to 31 days, the 30-day rate; for Dividend Periods greater than
    31 days but fewer than or equal to 61 days, the 60-day rate; for Dividend
    Periods greater than 61 days but fewer than or equal to 91 days, the 90 day
    rate; for Dividend Periods greater than 91 days but fewer than or equal to
    270 days, the rate described in clause (ii) below; for Dividend Periods
    greater than 270 days, the Treasury Index Rate; on commercial paper on
    behalf of financial issuers whose corporate bonds are rated 'AA' by S&P, or
    the equivalent of such rating by another nationally recognized rating
    agency, as announced by the Federal Reserve Bank of New York for the close
    of business on the Business Day immediately preceding such date; or (ii) if
    the Federal Reserve Bank of New York does not make available such a rate,
    then the arithmetic average of the interest equivalent of such rates on
    commercial paper placed on behalf of such issuers, as quoted on a discount
    basis or otherwise by the Commercial Paper Dealers to the Auction Agent for
    the close of business on the Business Day immediately preceding such date
    (rounded to the next highest .001 of 1%). If any Commercial Paper Dealer
    does not quote a rate required to determine the 'AA' Composite Commercial
    Paper Rate, such rate shall be determined on the basis of the quotations (or
    quotation) furnished by the remaining Commercial Paper Dealers (or Dealer),
    if any, or, if there are no such Commercial Paper Dealers, by the Auction
    Agent as agreed to by Merrill Lynch & Co. For purposes of this definition,
    (A) 'Commercial Paper Dealers' shall mean (1) Salomon Smith Barney Inc.,
    Lehman Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated and
    Goldman Sachs & Co.; (2) in lieu of any thereof, its respective Affiliate or
    successor; and (3) in the event that any of the foregoing shall cease to
    quote rates for commercial paper of issuers of the sort described above, in
    substitution therefor, a nationally recognized dealer in commercial paper of
    such issuers then making such quotations selected by the Corporation, and
    (B) 'interest equivalent' of a rate stated on a discount basis for
    commercial paper of a given number of days' maturity shall mean a number
    equal to the quotient (rounded upward to the next higher one-thousandth of
    1%) of (1) such rate expressed as a decimal, divided by (2) the difference
    between (x) 1.00 and (y) a fraction, the numerator of which shall be the
    product of such rate expressed as a decimal, multiplied by the number of
    days in which such commercial paper shall mature and the denominator of
    which shall be 360.

        'Affiliate' means any person known to the Auction Agent to be controlled
    by, in control of or under common control with the Corporation; provided,
    however, that no Broker-Dealer controlled by, in control of or under common
    control with the Corporation will be deemed to be an Affiliate nor will any
    corporation or any Person controlled by, in control of or under common
    control with such corporation, one of the directors or executive officers of
    which is a director of the Corporation be deemed to be an Affiliate solely
    because such director or executive officer is also a director of the
    Corporation.

        'Agent Member' means a member of or a participant in the Securities
    Depository that will act on behalf of a Bidder.

        'All Hold Rate' means the 7-day 'AA' Composite Commercial Paper Rate.

                                      B-16





<PAGE>


        'AMPS' has the meaning set forth in Article FIRST of these Articles
    Supplementary.

        'Applicable Rate' means for each Dividend Period (i) if Sufficient
    Clearing Orders exist for the Auction in respect thereof, the Winning Bid
    Rate, (ii) if Sufficient Clearing Orders do not exist for the Auction in
    respect thereof, the Maximum Rate, and (iii) in the case of any Dividend
    Period if all the shares of the Series are the subject of Submitted Hold
    Orders for the Auction in respect thereof, the All Hold Rate.

        'Approved Price' means the 'fair value' as determined by the Corporation
    in accordance with the valuation procedures adopted from time to time by the
    Board of Directors and for which the Corporation receives a mark-to-market
    price (which, for the purpose of clarity, does not mean a Market Value
    Price) from an independent source at least semi-annually.

        'Asset Coverage Cure Date' has the meaning set forth in Section 3(a)(ii)
    of these Articles Supplementary.

        'Auction' means each periodic operation of the Auction Procedures.

        'Auction Agent' means The Bank of New York unless and until another
    commercial bank, trust company, or other financial institution appointed by
    a resolution of the Board of Directors enters into an agreement with the
    Corporation to follow the Auction Procedures for the purpose of determining
    the Applicable Rate.

        'Auction Date' means the first Business Day next preceding the first day
    of a Dividend Period for the Series.

        'Auction Procedures' means the procedures for conducting Auctions as set
    forth in Part II of these Articles Supplementary.

        'Auditor's Certificate' has the meaning set forth in Section 12(f) of
    Part I of these Articles Supplementary.

        'Beneficial Owner' means a customer of a Broker-Dealer who is listed on
    the records of that Broker-Dealer (or, if applicable, the Auction Agent) as
    a holder of shares of the Series.

        'Bid' has the meaning set forth in Section 2(a)(ii) of Part II of these
    Articles Supplementary.

        'Bidder' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary, provided however that neither the Corporation
    nor any Affiliate will be permitted to be Bidder in an Auction.

        'Board of Directors' or 'Board' means the Board of Directors of the
    Corporation or any duly authorized committee thereof as permitted by
    applicable law.

        'Broker-Dealer' means any broker-dealer or broker-dealers, or other
    entity permitted by law to perform the functions required of a Broker-Dealer
    by the Auction Procedures, that has been selected by the Corporation and has
    entered into a Broker-Dealer Agreement that remains effective.

        'Broker-Dealer Agreement' means an agreement between the Auction Agent
    and a Broker-Dealer, pursuant to which such Broker-Dealer agrees to follow
    the Auction Procedures.

        'Business Day' means a day on which the New York Stock Exchange is open
    for trading and which is not a Saturday, Sunday or other day on which banks
    in The City of New York, New York are authorized or obligated by law to
    close.

        'Charter' has the meaning set forth in the preamble to these Articles
    Supplementary.

        'Code' means the Internal Revenue Code of 1986, as amended.

        'Commission' means the Securities and Exchange Commission.

        'Common Shares' means the shares of the Corporation's Common Stock, par
    value $.001 per share.

        'Corporation' has the meaning set forth in the preamble to these
    Articles Supplementary.

                                      B-17





<PAGE>



        'Date of Original Issue' means the date on which the Series is
    originally issued by the Corporation.

        'Default' has the meaning set forth in Section 2(c)(ii) of Part I of
    these Articles Supplementary.

        'Default Period' has the meaning set forth in Sections 2(c)(ii) or (iii)
    of Part I of these Articles Supplementary.

        'Default Rate' has the meaning set forth in Sections 2(c)(iii) of
    Part I of these Articles Supplementary.

        'Deposit Securities' means cash and any obligations or securities,
    including Short Term Money Market Instruments that are Eligible Assets,
    rated at least AAA or A-1 by S&P, except that, for purposes of optional
    redemption, such obligations or securities will be considered 'Deposit
    Securities' only if they also are rated at least P-1 by Moody's.

        'Discount Factor' means the S&P Discount Factor (if S&P is then rating
    the Series), the Moody's Discount Factor (if Moody's is then rating the
    Series) or the discount factor established by any Other Rating Agency which
    is then rating the Series and which so requires, whichever is applicable.

        'Discounted Value' means the quotient of the Market Value of an Eligible
    Asset divided by the applicable Discount Factor, provided that with respect
    to an Eligible Asset that is currently callable, Discounted Value will be
    equal to the quotient as calculated above or the call price, whichever is
    lower, and that with respect to an Eligible Asset that is prepayable,
    Discounted Value will be equal to the quotient as calculated above or the
    par value, whichever is lower.

        'Dividend Default' has the meaning set forth in Section 2(c)(ii) of
    Part I of these Articles Supplementary.

        'Dividend Payment Date' means any date on which dividends are payable
    pursuant to Section 2(b) of Part I hereof.

        'Dividend Period' means the initial period determined in the manner set
    forth under 'Designation' above, and thereafter, the period commencing on
    the Business Day following each Dividend Period and ending on the calendar
    day immediately preceding the next Dividend Payment Date.

        'Eligible Assets' means Moody's Eligible Assets (if Moody's is then
    rating the Series), S&P Eligible Assets (if S&P is then rating the Series),
    and/or Other Rating Agency Eligible Assets if any Other Rating Agency is
    then rating the Series, whichever is applicable.

        'Existing Holder' has the meaning set forth in Section 1 of Part II of
    these Articles Supplementary.

        'Hold Order' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary.

        'Holder' means, with respect to the Series, the registered holder of
    shares of the Series as the same appears on the stock ledger or stock
    records of the Corporation.

        'Investment Manager' means Cohen & Steers Capital Management, Inc.

        'Liquidation Preference' means $25,000 per share of the Series.

        'Mandatory Redemption Date' has meaning set forth in Section 3(a)(iii)
    of Part I of these Articles Supplementary.

        'Mandatory Redemption Price' has the meaning set forth in Section
    3(a)(iii) of Part I of these Articles Supplementary.

        'Market Value' means the fair market value of an asset of the
    Corporation as computed as follows: Securities listed on the New York Stock
    Exchange at the last sale price reflected on the consolidated tape at the
    close of the New York Stock Exchange on the Business Day as of which such
    value is being determined provided that, if there has been no sale on such

                                      B-18





<PAGE>


    day, the securities are valued at the closing mean prices on such day and
    provided further that, if no prices are quoted on such day, then the
    security is valued by such method as the Board of Directors will determine
    in good faith to reflect its fair market value. Readily marketable
    securities not listed on the New York Stock Exchange but listed on other
    domestic or foreign securities exchanges or admitted to trading on the
    National Association of Securities Dealers Automated Quotations, Inc.
    ('NASDAQ') National List are valued in a like manner. Portfolio securities
    traded on more than one securities exchange are valued at the last sale
    price on the business day as of which such value is being determined as
    reflected on the tape at the close of the exchange representing the
    principal market for such securities. Readily marketable securities traded
    in the over-the-counter market, including listed securities whose primary
    market is believed by the Investment Manager to be over-the-counter, but
    excluding securities admitted to trading on the NASDAQ National List, are
    valued at the current bid prices as reported by NASDAQ or, in the case of
    securities not quoted by NASDAQ, the National Quotation Bureau or such other
    comparable source as the directors deem appropriate to reflect their fair
    market value. The fair market value of certain fixed-income securities is
    computed based upon (i) the basis of prices provided by a Pricing Service or
    (ii) the lower of the value set forth in bids from two independent dealers
    in securities, one of which bids will be in writing, in each case with
    interest accrued added to such computation for those assets of the
    Corporation where such computation does not include interest accrued. The
    independent dealers from whom bids are sought will be either (a) market
    makers in the securities being valued or (b) members of the National
    Association of Securities Dealers, Inc. Where securities are traded on more
    than one exchange and also over-the-counter, the securities will generally
    be valued using the quotations the Board of Directors believes reflect most
    closely the value of such securities.

    'Maximum Rate' means, on any date on which the Applicable Rate is
determined, the applicable percentage of the 'AA' Composite Commercial Paper
Rate on the date of such Auction determined as set forth below based on the
lower of the credit ratings assigned to the Series by Moody's and S&P subject to
upward but not downward adjustment in the discretion of the Board of Directors
after consultation with the Broker-Dealers; provided that immediately following
any such increase the Corporation would be in compliance with the Preferred
Shares Basic Maintenance Amount.

<Table>
<Caption>
   MOODY'S                  S&P                APPLICABLE
CREDIT RATING          CREDIT RATING           PERCENTAGE
-------------          -------------           ----------
<S>                   <C>                      <C>
Aa3 or Above          AA- or Above                150%
A3 or A1              A- to A+                    200%
Baa3 to Baa1          BBB- to BBB+                225%
Below Baa3            Below BBB-                  275%
</Table>

    'Moody's' means Moody's Investors Service, Inc. and its successors at law.

    'Moody's Discount Factor' means, for purposes of determining the Discounted
Value of any Moody's Eligible Asset, the percentage determined as follows. The
Moody's Discount Factor for any Moody's Eligible Asset other than the securities
set forth below will be the percentage provided in writing by Moody's.

    (a) Common Stock and Preferred Stock of REITs and Other Real Estate
Companies:

<Table>
<Caption>
                                                          DISCOUNT FACTOR(1)(2)(3)
                                                          ------------------------
<S>                                                       <C>
Common stock of REITs                                               154%
Preferred stock of REITs
    with Senior Implied Moody's (or S&P) rating:                    154%
    without Senior Implied Moody's (or S&P) rating:                 208%
Preferred stock of Other Real Estate Companies
    with Senior Implied Moody's (or S&P) rating:                    208%
    without Senior Implied Moody's (or S&P) rating:                 250%
</Table>

                                                        (footnotes on next page)

                                      B-19





<PAGE>



(footnotes from previous page)

(1) A Discount Factor of 250% will be applied to those assets in a single
    Moody's Real Estate Industry/Property Sector Classification which exceed 30%
    of Moody's Eligible Assets but are not greater than 35% of Moody's Eligible
    Assets.

(2) A Discount Factor of 250% will be applied if dividends on such securities
    have not been paid consistently (either quarterly or annually) over the
    previous three years, or for such shorter time period that such securities
    have been outstanding.

(3) A Discount Factor of 250% will be applied if the market capitalization
    (including common stock and preferred stock) of an issuer is below $500
    million.

    (b) Debt Securities of REITs and Other Real Estate Companies:

<Table>
<Caption>
          TERMS OF MATURITY OF
       NON-INVESTMENT GRADE BONDS         Aaa     Aa     A     Baa     Ba     B     NR(1)
       --------------------------         ---     --     -     ---     --     -     -----
<S>                                       <C>    <C>    <C>    <C>    <C>    <C>    <C>
1 year or less                            109%   112%   115%   118%   137%   150%   250%
2 years or less (but longer than 1 year)  115%   118%   122%   125%   146%   160%   250%
3 years or less (but longer than 2
  years)                                  120%   123%   127%   131%   153%   168%   250%
4 years or less (but longer than 3
  years)                                  126%   129%   133%   138%   161%   176%   250%
5 years or less (but longer than 4
  years)                                  132%   135%   139%   144%   168%   185%   250%
7 years or less (but longer than 5
  years)                                  139%   143%   147%   152%   179%   197%   250%
10 years or less (but longer than 7
  years)                                  145%   150%   155%   160%   189%   208%   250%
15 years or less (but longer than 10
  years)                                  150%   155%   160%   165%   196%   216%   250%
20 years or less (but longer than 15
  years)                                  150%   155%   160%   165%   196%   228%   250%
30 years or less (but longer than 20
  years)                                  150%   155%   160%   165%   196%   229%   250%
Greater than 30 years                     165%   173%   181%   189%   205%   240%   250%
</Table>

---------

(1) Unless conclusions regarding liquidity risk as well as estimates of both the
    probability and severity of default for the corporation's or municipal
    issuer's assets can be derived from other sources as well as combined with a
    number of sources as presented by the Corporation to Moody's, securities
    rated below B by Moody's and unrated securities, which are securities rated
    by neither Moody's, S&P nor Fitch, are limited to 10% of Moody's Eligible
    Assets. If a corporate or municipal debt security is unrated by Moody's, S&P
    or Fitch, the Corporation will use the percentage set forth under 'Below B
    and Unrated' in the Corporate or Municipal Debt Tables. Ratings assigned by
    S&P or Fitch are generally accepted by Moody's at face value. However,
    adjustments to face value may be made to particular categories of credits
    for which the S&P and/or Fitch rating does not seem to approximate a Moody's
    rating equivalent. Split rated securities assigned by S&P and Fitch will be
    accepted at the lower of the two ratings.

    (c) U.S. Treasury Securities and U.S. Treasury Strips (as defined by
Moody's):

<Table>
<Caption>
                                                 U.S. TREASURY STRIPS   U.S. TREASURY SECURITIES
REMAINING TERM TO MATURITY                         DISCOUNT FACTOR          DISCOUNT FACTOR
--------------------------                         ---------------          ---------------
<S>                                              <C>                    <C>
1 year or less                                           107%                     107%
2 years or less (but longer than 1 year)                 113%                     115%
3 years or less (but longer than 2 years)                118%                     121%
4 years or less (but longer than 3 years)                123%                     128%
5 years or less (but longer than 4 years)                128%                     135%
7 years or less (but longer than 5 years)                135%                     147%
10 years or less (but longer than 7 years)               141%                     163%
15 years or less (but longer than 10 years)              146%                     191%
20 years or less (but longer than 15 years)              154%                     218%
30 years or less (but longer than 20 years)              154%                     244%
</Table>

    (d) Short-Term Instruments and Cash. The Moody's Discount Factor applied to
Moody's Eligible Assets that are short term money instruments (as defined by
Moody's) will be (i) 100%, so long as such portfolio securities mature or have a
demand feature at par exercisable within 49 days of the relevant valuation date,
(ii) 102%, so long as such portfolio securities mature or have a demand feature
at par not exercisable within 49 days of the relevant valuation date, and
(iii) 125%, if such securities are not rated by Moody's, so long as such
portfolio securities are rated at least A-1+/AA or SP-1+/AA by S&P or Fitch and
mature or have a demand feature at par exercisable within 49 days of the
relevant valuation date. A Moody's Discount Factor of 100% will be applied to
cash.

                                      B-20





<PAGE>


        'Moody's Eligible Assets' means the following:

           (a) Common Stock, Preferred Stock and any debt security of REITs and
       Other Real Estate Companies. (i) Common stock of REITs and preferred
       stock and any debt security of REITs and Other Real Estate Companies:
       (A) which comprise at least 7 of the 14 Moody's Real Estate
       Industry/Property Sector Classifications ('Moody's Sector
       Classifications') listed below and of which no more than 35% may
       constitute a single such classification; (B) which in the aggregate
       constitute at least 40 separate issues of common stock, preferred stock,
       and debt securities, issued by at least 30 issuers; (C) issued by a
       single issuer which in the aggregate constitute no more than 7.0% of the
       Market Value of Moody's Eligible Assets, and (D) issued by a single
       issuer which, with respect to 50% of the Market Value of Moody's Eligible
       Assets, constitute in the aggregate no more than 5% of Market Value of
       Moody's Eligible Assets; and

           (ii) Unrated debt securities issued by an issuer which: (A) has not
       filed for bankruptcy within the past three years; (B) is current on all
       principal and interest on its fixed income obligations; (C) is current on
       all preferred stock dividends; (D) possesses a current, unqualified
       auditor's report without qualified, explanatory language and (E) in the
       aggregate do not exceed 10% of the discounted Moody's Eligible Assets;

           (b) Interest rate swaps entered into according to International Swap
       Dealers Association ('ISDA') standards if

               (i) the counterparty to the swap transaction has a short-term
           rating of not less than P-1 by Moody's or A-1 by S&P or, if the
           counterparty does not have a short-term rating, the counterparty's
           senior unsecured long-term debt rating is A3 or higher by Moody's or
           A+ or higher by S&P;

               (ii) the original aggregate notional amount of the interest rate
           swap transaction or transactions is not to be greater than the
           liquidation preference of the AMPS originally issued;

               (iii) the interest rate swap transaction will be marked-to-market
           daily;

               (iv) an interest rate swap that is in-the-money is discounted at
           the counterparty's corporate debt rating for the maturity of the swap
           for purposes of calculating Moody's Eligible Assets; and

               (v) an interest rate swap that is out-of-the money includes that
           negative mark-to-market amount as indebtedness for purposes of
           calculating the Preferred Shares Basic Maintenance amount;

           (c) U.S. Treasury Securities and Treasury Strips (as defined by
       Moody's);

           (d) Short-Term Money Market Instruments so long as (A) such
       securities are rated at least P-1, (B) in the case of demand deposits,
       time deposits and overnight funds, the supporting entity is rated at
       least A2, or (C) in all other cases, the supporting entity (1) is rated
       A2 and the security matures within one month, (2) is rated A1 and the
       security matures within three months or (3) is rated at least Aa3 and the
       security matures within six months; provided, however, that for purposes
       of this definition, such instruments (other than commercial paper rated
       by S&P and not rated by Moody's) need not meet any otherwise applicable
       Moody's rating criteria; and

           (e) Cash (including, for this purpose, interest and dividends due on
       assets rated (A) Baa3 or higher by Moody's if the payment date is within
       five Business Days of the Valuation Date, (B) A2 or higher if the payment
       date is within thirty days of the Valuation Date, and (C) A1 or higher if
       the payment date is within 49 days of the relevant valuation date) and
       receivables for Moody's Eligible Assets sold if the receivable is due
       within five Business Days of the Valuation Date, and if the trades which
       generated such receivables are (A) settled through clearing house firms
       with respect to which the Corporation has received prior written
       authorization from Moody's or (B) (1) with counterparties having a
       Moody's long-term debt rating of at least Baa3 or (2) with
                                      B-21





<PAGE>


       counterparties having a Moody's Short-Term Money Market Instrument rating
       of at least P-1.

        'Moody's Real Estate Industry/ Property Sector Classification' means,
    for the purposes of determining Moody's Eligible Assets, each of the
    following Industry Classifications (as defined by the National Association
    of Real Estate Investment Trusts, 'NAREIT'):

            1. Office

            2. Industrial

            3. Mixed

            4. Shopping Centers

            5. Regional Malls

            6. Free Standing

            7. Apartments

            8. Manufactured Homes

            9. Diversified

           10. Lodging/Resorts

           11. Health Care

           12. Home Financing

           13. Commercial Financing

           14. Self Storage

        The Corporation will use its discretion in determining which NAREIT
    Industry Classification is applicable to a particular investment in
    consultation with the independent auditor and/or Moody's, as necessary.

        '1933 Act' means the Securities Act of 1933, as amended.

        '1940 Act' means the Investment Company Act of 1940, as amended.

        '1940 Act Preferred Shares Asset Coverage' means asset coverage, as
    determined in accordance with Section 18(h) of the 1940 Act, of at least
    200% with respect to all outstanding senior securities of the Corporation
    which are stock, including all outstanding shares of the Series (or such
    other asset coverage as may in the future be specified in or under the 1940
    Act as the minimum asset coverage for senior securities which are stock of a
    closed-end investment company as a condition of declaring dividends on its
    common shares), determined on the basis of values calculated as of a time
    within 48 hours (not including Sundays or holidays) next preceding the time
    of such determination.

        '1940 Act Preferred Shares Asset Coverage Certificate' means the
    certificate required to be delivered by the Corporation pursuant to Section
    12(e) of these Articles Supplementary.

        'Notice of Redemption' means any notice with respect to the redemption
    of the Series pursuant to Section 3 of Part I of these Articles
    Supplementary.

        'Order' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary.

        'Other Rating Agency' means any rating agency other than S&P or Moody's
    then providing a rating for the Series pursuant to the request of the
    Corporation.

        'Other Rating Agency Eligible Assets' means assets of the Corporation
    designated by any Other Rating Agency as eligible for inclusion in
    calculating the discounted value of the Corporation's assets in connection
    with such Other Rating Agency's rating of the Series.

        'Other Real Estate Companies' companies which generally derive at least
    50% of their revenue from real estate or has at least 50% of its assets in
    real estate, but not including REITs.

                                      B-22





<PAGE>


        'Outstanding' means, as of any date, shares of the Series theretofore
    issued by the Corporation except, without duplication, (i) any shares of the
    Series theretofore canceled, redeemed or repurchased by the Corporation, or
    delivered to the Auction Agent for cancellation or with respect to which the
    Corporation has given notice of redemption and irrevocably deposited with
    the Paying Agent sufficient funds to redeem such shares and (ii) any shares
    of the Series represented by any certificate in lieu of which a new
    certificate has been executed and delivered by the Corporation.
    Notwithstanding the foregoing, (A) for purposes of voting rights (including
    the determination of the number of shares required to constitute a quorum),
    any shares of the Series as to which the Corporation or any Affiliate is the
    Existing Holder will be disregarded and not deemed Outstanding; (B) in
    connection with any Auction, any shares of the Series as to which the
    Corporation or any person known to the Auction Agent to be an Affiliate is
    the Existing Holder will be disregarded and not deemed Outstanding; and
    (C) for purposes of determining the Preferred Shares Basic Maintenance
    Amount, shares of the Series held by the Corporation will be disregarded and
    not deemed Outstanding, but shares held by any Affiliate will be deemed
    Outstanding.

        'Paying Agent' means The Bank of New York unless and until another
    entity appointed by a resolution of the Board of Directors enters into an
    agreement with the Corporation to serve as paying agent, which paying agent
    may be the same as the Auction Agent.

        'Person' or 'Persons' means and includes an individual, a partnership,
    the corporation, a trust, a corporation, a limited liability company, an
    unincorporated association, a joint venture or other entity or a government
    or any agency or political subdivision thereof.

        'Potential Beneficial Owner or Holder' has the meaning set forth in
    Section 1 of Part II of these Articles Supplementary.

        'Preferred Shares Basic Maintenance Amount' means as of any Valuation
    Date as the dollar amount equal to the difference of:

           (i) the sum of (A) the product resulting from multiplying the number
       of shares of the Series outstanding on such date by the Liquidation
       Preference per share (plus the product of the number of shares of any
       other series of preferred shares outstanding on such date multiplied by
       the liquidation preference of such shares), plus any redemption premium
       applicable to the Series (or other preferred shares) then subject to
       redemption; plus (B) the aggregate amount of dividends that will have
       accumulated (whether or not earned or declared) for the shares of the
       Series outstanding and any other series of preferred shares outstanding
       on such date to the 30th day after such Valuation Date; plus (C) the
       aggregate amount of dividends that would accumulate on shares of the
       Series outstanding from the first Dividend Payment Date of the Valuation
       Date through the 56th day after such Valuation Date, at the Maximum Rate
       (plus the aggregate amount of dividends that would accumulate on other
       outstanding preferred shares from the first respective dividend payment
       date for such shares after the Valuation Date through the 56th day after
       such Valuation Date, at the respective maximum rates for such other
       outstanding preferred shares); plus (D) the amount of anticipated
       Corporation non-interest expenses for the 90 days subsequent to such
       Valuation Date; plus (E) the amount of the current outstanding balances
       of any indebtedness which is senior to the shares of the Series plus
       interest actually accrued together with 30 days additional interest
       on the current outstanding balances calculated at the current rate;
       plus (F) any other current liabilities payable during the 30 days
       subsequent to such Valuation Date, including, without limitation,
       indebtedness due within one year and any redemption premium due with
       respect to shares of the Series and any other outstanding series of
       preferred shares for which a Notice of Redemption or notice of
       redemption, respectively, has been given, as of such Valuation Date,
       to the extent not reflected in any of (i)(A) through (i)(E); and plus
       (G) any current liabilities as of such Valuation Date to the extent not
       reflected in any of (i)(A) through (i)(F); less

           (ii) the sum of any cash plus the value of any of the Corporation's
       assets irrevocably deposited by the Corporation for the payment of any
       (i)(B) through (i)(F) ('value,' for purposes of this clause (ii), means
       the Discounted Value of the security, except that if the

                                      B-23





<PAGE>

       security matures prior to the relevant redemption payment date and is
       either fully guaranteed by the U.S. Government or is rated at least P-1
       by Moody's and A-1 by S&P, it will be valued at its face value).

        'Preferred Shares Basic Maintenance Amount Test' means a test which is
    met if the lower of the aggregate Discounted Values of the Moody's Eligible
    Assets or the S&P Eligible Assets meets or exceeds the Preferred Shares
    Basic Maintenance Amount.

        'Preferred Shares Basic Maintenance Certificate' has the meaning set
    forth in Section 12(d) of Part I of these Articles Supplementary.

        'Pricing Service' means any of the following: Bloomberg, Bridge
    Information Services, Data Resources Inc., Interactive Data, International
    Securities Market Association, Merrill Lynch Securities Pricing Service,
    Muller Data Corp., Reuters, Standard & Poors/J.J. Kenny, Telerate, Trepp
    Pricing and Wood Gundy.

        'Rating Agency' means Moody's and S&P as long as such rating agency is
    then rating the Series.

        'Redemption Date' has the meaning set forth in Section 2(c)(ii) of
    Part II of these Articles Supplementary.

        'Redemption Default' has the meaning set forth in Section 2(c)(ii) of
    Part I of these Articles Supplementary.

        'Redemption Price' has the meaning set forth in Section 3(a)(i) of
    Part I of these Articles Supplementary.

        'Reference Rate' means, with respect to the determination of the Default
    Rate, the applicable 'AA' Composite Commercial Paper Rate (for a Dividend
    Period of fewer than 184 days) or the applicable Treasury Index Rate (for a
    Dividend Period of 184 days or more).

        'Registrar' means The Bank of New York, unless and until another entity
    appointed by a resolution of the Board of Directors enters into an agreement
    with the Corporation to serve as transfer agent.

        'REIT' or real estate investment trust, means a company dedicated to
    owning, and usually operating, income producing real estate, or to financing
    real estate.

        'S&P' means Standard & Poor's, a division of The McGraw-Hill Companies,
    Inc., or its successors at law. 'S&P Discount Factor' means, for purposes of
    determining the Discounted Value of any S&P Eligible Asset, the percentage
    determined as follows. The S&P Discount Factor for any S&P Eligible Asset
    other than the securities set forth below will be the percentage provided in
    writing by S&P:

    (a) Common Stock and Preferred Stock of REITs and Other Real Estate
Companies:

<Table>
<Caption>
                                                            DIVERSIFICATION STANDARD
                                                      -------------------------------------
                                                      LEVEL 1   LEVEL 2   LEVEL 3   LEVEL 4
                                                      -------   -------   -------   -------
<S>                                                   <C>       <C>       <C>       <C>
MINIMUM NUMBER OF:
Issuers(1)                                               44        40        44        30
Real Estate Industry/Property Sectors(2)                 10         8         7         7
PERCENT OF ASSETS IN:
Largest Real Estate Industry/Property Sector             17%       25%       30%       30%
2nd Largest Real Estate Industry/Property Sector         15%       20%       25%       25%
3rd Largest Real Estate Industry/Property Sector         12%       15%       15%       15%
4th Largest Real Estate Industry/Property Sector         12%       12%       12%       12%
S&P DISCOUNT FACTOR:
common stock                                            190%      208%      223%      231%
preferred stock(3)                                      157%      167%      174%      178%
</Table>

---------

(1) Three issuers may each constitute 6% of assets and four issuers may each
    constitute 5% of assets.
                                              (footnotes continued on next page)

                                      B-24





<PAGE>


(footnotes continued from previous page)

(2) As defined by NAREIT.

(3) Applies to preferred stock of real estate companies, subject to
    diversification guidelines whereby at least 34% of the preferred assets are
    rated BB (or Moody's equivalent) or greater; at least 33% are rated B (or
    Moody's equivalent) or greater; and the balance of the preferred assets is
    rated B- (or Moody's equivalent) or is unrated. The Discount Factor for
    common stock will apply to preferred stock which is not in compliance with
    the diversification standard.

    (b) Debt Securities:

<Table>
<Caption>
                                                    DIVERSIFICATION STANDARD
                                              -------------------------------------
BOND RATING(1)                                LEVEL 1   LEVEL 2   LEVEL 3   LEVEL 4
--------------                                -------   -------   -------   -------
<S>                                           <C>       <C>       <C>       <C>
A                                              116%      117%      119%      118%
A-                                             117%      119%      120%      120%
BBB+                                           119%      121%      122%      122%
BBB                                            121%      122%      124%      124%
BBB-                                           122%      124%      126%      126%
BB+                                            127%      130%      133%      132%
BB                                             133%      137%      141%      139%
BB-                                            139%      144%      149%      147%
B+                                             152%      159%      166%      164%
B                                              163%      172%      182%      179%
B-                                             176%      188%      202%      197%
CCC+                                           198%      212%      230%      224%
CCC                                            236%      262%      295%      284%
</Table>

---------

(1) The S&P Discount Factors for debt securities will also be applied to any
    interest rate swap or cap, in which case the rating of the counterparty will
    determine the appropriate rating category.

(2) If a security is unrated by S&P but is rated by Moody's, the conversion
    chart under S&P OC Test Rating Chart will apply.

    (c) U.S. Treasury Securities, including Treasury interest-only Strips and
Treasury principal-only Strips, as set forth below:

<Table>
<S>                                                           <C>
52-week Treasury Bills*                                       102%
Two-Year Treasury Notes                                       104%
Three-Year Treasury Notes                                     108%
Five-Year Treasury Notes                                      109%
10-Year Treasury Notes                                        115%
30-Year Treasury Bonds                                        126%
</Table>

---------

* Treasury Bills with maturities of less than 52 weeks will be discounted at the
  appropriate Short-Term Money Market Instrument levels. Treasury Bills that
  mature the next day are considered cash equivalents and are valued at 100%.

Treasury Strips: Treasury interest-only Strips will apply the discount factor
for the Treasury category set forth above following the maturity of the Treasury
Strip, e.g., a Treasury interest-only Strip with a maturity of seven years will
apply the discount factor for the U.S. Treasury securities with a 10-year
maturity. Treasury principal-only Strips will apply the discount factor that is
two categories greater than its maturity, e.g., a Treasury principal-only Strip
with a maturity of seven years will apply the discount factor for U.S. Treasury
securities with a 30-year maturity.

    (d) Cash and Cash Equivalents: The S&P Discount Factor applied to Cash and
Cash Equivalents will be (A) 100% and (B) 102% for those portfolio securities
which mature in 181 to 360 calendar days.

        'S&P Eligible Assets' means the following:

           (a) Common Stock, Preferred Stock and any debt securities of REITs
       and Real Estate Companies;

           (b) Interest rate swaps entered into according to International Swap
       Dealers Association ('ISDA') standards if (i) the counterparty to the
       swap transaction has a short-term rating of not less than A-1 or, if the
       counterparty does not have a short-term rating, the counterparty's senior
       unsecured long-term debt rating is A+ or higher and (ii) the original
       aggregate notional amount of the interest rate swap transaction or

                                      B-25





<PAGE>



       transactions is not to be greater than the liquidation preference of the
       Series and any other outstanding preferred shares originally issued. The
       interest rate swap transaction will be marked-to-market daily;

           (c) U.S. Treasury Securities and Treasury Strips (as defined by S&P);

           (d) Short-Term Money Market Instruments so long as (A) such
       securities are issued by an institution, which, at the time of
       investment, is a permitted bank (including commercial paper issued by a
       corporation which complies with the applicable assumptions that follow)
       ('permitted bank' means any bank, domestic or foreign, whose commercial
       paper is rated A-1+) provided, however, that Short-Term Money Market
       Instruments with maturities of 30 days of less, invested in an
       institution rated A-1 may comprise up to 20% of eligible portfolio
       assets; and

           (e) Cash, which is any immediately available funds in U.S. dollars or
       any currency other than U.S. dollars which is a freely convertible
       currency, and Cash Equivalents, which means investments (other than Cash)
       that are one or more of the following obligations or securities:
       (i) U.S. Government Securities; (ii) certificates of deposits of,
       banker's acceptances issued by or money market accounts in any depository
       institution or trust company incorporated under the laws of the United
       States of America or any state thereof and subject to supervision and
       examination by Federal and/ or state banking authorities, so long as the
       deposits offered by such depository institution or trust company at the
       time of such investments are rated and have a rating of at least 'P-1' by
       Moody's and 'A-1+' by S&P (or, in the case of the principal depository
       institution in a holding company system whose deposits are not so rated,
       the long term debt obligations of such holding company are rated and such
       rating is at least 'A-1' by Moody's and 'A+' by S&P); (iii) commercial
       paper issued by any depositary institution or trust company incorporated
       under the laws of the United States of America or any state thereof and
       subject to supervision and examination by Federal and/or state banking
       authorities, or any corporation incorporated under the laws of the United
       States of America or any state thereof, so long as the commercial paper
       of such issuer is rated and has at the time of such investment a short
       term rating of at least 'P-1' by Moody's and 'A-1+' by S&P on its
       commercial paper; (iv) securities bearing interest or sold at a discount
       issued by any corporation incorporated under the laws of the United
       States of America or any state thereof the obligations of which at the
       time of such investment are rated and that have a credit rating of at
       least 'P-1' by Moody's and 'A-1+' by S&P either at the time of such
       investment or the making of a contractual commitment providing for such
       investment; (v) shares of any money market fund organized under the laws
       of a jurisdiction other than the United States, so long as such money
       market fund is rated and has at the time of such investment a short-term
       rating of at least 'AAAm' or 'AAAg' by S&P and 'Aaa' by Moody's and
       ownership of such investments will not cause the issuer to become engaged
       in a trade or business within the United States for U.S. Federal income
       tax purposes or subject the issuer to tax on a net income basis; and
       (vi) unleveraged overnight repurchase obligations on customary terms with
       respect to investments described in clauses (i) through (iv) above
       entered into a depository institution, trust company or corporation that
       has a short-term rating of at least 'A-1+' by S&P; provided, that (i) in
       no event will Cash Equivalents include any obligation that provides for
       payment of interest alone; (ii) Cash Equivalents referred to in clauses
       (ii) and (iii) above will mature within 183 days of issuance;
       (iii) either Moody's or S&P changes its rating system, then any ratings
       included in this definition will be deemed to be an equivalent rating in
       a successor rating category of Moody's or S&P, as the case may be;
       (iv) if either Moody's or S&P is not in the business of rating
       securities, then any ratings included in this definition will be deemed
       to be an equivalent rating from another Rating Agency; (v) Cash
       Equivalents (other than U.S. Government Securities or money market funds
       maintained by the Custodian) will not include any such investment of more
       than $100 million in any single issuer; and (vi) in no event will Cash
       Equivalents include any obligation that is not denominated in Dollars,
       any synthetic securities, any Securities with ratings containing an

                                      B-26





<PAGE>



       'r' subscript, and IOs or any POs (other than commercial paper with a
       maturity within 183 days of issuance).

       'S&P OC Test Rating Chart' means the chart set forth below:

<Table>
<Caption>
MOODY'S RATING          MAPPED S&P RATING
--------------          -----------------
<S>                     <C>
Aaa                         AA+
Aa1                         AA
Aa2                         AA-
Aa3                         A+
A1                          A
A2                          A-
A3                          BBB+
Baa1                        BBB
Baa2                        BBB-
Baa3                        BB+
Ba1                         BB-
Ba2                         B+
Ba3                         B
B1                          B-
B2                          CCC+
B3                          CCC
Caa                         CCC-
NR or below Caa             NR
</Table>

        'S&P Real Estate Industry/Property Sector Classification' means, for the
    purposes of determining S&P Eligible Assets, each of the following Industry
    Classifications (as defined by NAREIT):

            1. Office

            2. Industrial

            3. Mixed

            4. Shopping Centers

            5. Regional Malls

            6. Free Standing

            7. Apartments

            8. Manufactured Homes

            9. Diversified

           10. Lodging/Resorts

           11. Health Care

           12. Home Financing

           13. Commercial Financing

           14. Self Storage

        The Corporation will use its discretion in determining which NAREIT
    Industry Classification is applicable to a particular investment, and, when
    necessary will consult with the independent auditor and/or S&P, as
    necessary.

        'Securities Depository' means The Depository Trust Company and its
    successors and assigns or any successor securities depository selected by
    the Corporation that agrees to follow the procedures required to be followed
    by such securities depository in connection with the Series.

        'Sell Order' has the meaning set forth in Section 2(ii) of Part II of
    these Articles Supplementary.

                                      B-27





<PAGE>



        'Short-Term Money Market Instrument' means the following types of
    instruments if, on the date of purchase or other acquisition thereof by the
    Corporation, the remaining term to maturity thereof is not in excess of 180
    days:

           (i) commercial paper rated A-1 if such commercial paper matures in
       30 days or A-1+if such commercial paper matures in over 30 days;

           (ii) demand or time deposits in, and banker's acceptances and
       certificates of deposit of (A) a depository institution or trust company
       incorporated under the laws of the United States of America or any state
       thereof or the District of Columbia or (B) a United States branch office
       or agency of a foreign depository institution (provided that such branch
       office or agency is subject to banking regulation under the laws of the
       United States, any state thereof or the District of Columbia);

           (iii) overnight funds; and

           (iv) U.S. Government Securities.

        'Special Dividend Period' means a Dividend Period that is not a Standard
    Dividend Period.

        'Specific Redemption Provisions' means, with respect to any Special
    Dividend Period of more than one year, either, or any combination of (i) a
    period (a 'Non-Call Period') determined by the Board of Directors after
    consultation with the Broker-Dealers, during which the shares subject to
    such Special Dividend Period are not subject to redemption at the option of
    the Corporation and (ii) a period (a 'Premium Call Period'), consisting of a
    number of whole years as determined by the Board of Directors after
    consultation with the Broker-Dealers, during each year of which the shares
    subject to such Special Dividend Period will be redeemable at the
    Corporation's option at a price per share equal to the Liquidation
    Preference plus accumulated but unpaid dividends (whether or not earned or
    declared) plus a premium expressed as a percentage or percentages of the
    Liquidation Preference or expressed as a formula using specified variables
    as determined by the Board of Directors after consultation with the
    Broker-Dealers.

        'Standard Dividend Period' means a Dividend Period of 7 days, unless the
    day after such 7th day is not a Business Day, then the number of days ending
    on the calendar day next preceding the next Business Day (such Business Day,
    being the Dividend Payment Date).

        'Submission Deadline' means 1:00 p.m., New York City time, on any
    Auction Date or such other time on any Auction Date by which Broker-Dealers
    are required to submit Orders to the Auction Agent as specified by the
    Auction Agent from time to time.

        'Transfer Agent' means The Bank of New York, unless and until another
    entity appointed by a resolution of the Board of Directors enters into an
    agreement with the Corporation to serve as Transfer Agent.

        'Treasury Index Rate' means the average yield to maturity for actively
    traded marketable U.S. Treasury fixed interest rate securities having the
    same number of 30-day periods to maturity as the length of the applicable
    Dividend Period, determined, to the extent necessary, by linear
    interpolation based upon the yield for such securities having the next
    shorter and next longer number of 30-day periods to maturity treating all
    Dividend Periods with a length greater than the longest maturity for such
    securities as having a length equal to such longest maturity, in all cases
    based upon data set forth in the most recent weekly statistical release
    published by the Board of Governors of the Federal Reserve System (currently
    in H.15 (519)); provided, however, if the most recent such statistical
    release will not have been published during the 15 days preceding the date
    of computation, the foregoing computations will be based upon the average of
    comparable data as quoted to the Corporation by at least three recognized
    dealers in U.S. Government Securities selected by the Corporation.

        'U.S. Government Securities' means direct obligations of the United
    States or by its agencies or instrumentalities that are entitled to the full
    faith and credit of the United States

                                      B-28





<PAGE>



    and that, other than United States Treasury Bills, provide for the periodic
    payment of interest and the full payment of principal at maturity or call
    for redemption.

        'Valuation Date' means the last Business Day of each week, or such other
    date as the Corporation and Rating Agencies may agree to for purposes of
    determining the Preferred Shares Basic Maintenance Amount.

        'Voting Period' has the meaning set forth in Section 6(b) of Part I of
    these Articles Supplementary.

        'Winning Bid Rate' has the meaning set forth in Section 4(a)(iii) of
    Part II of these Articles Supplementary.

    18. Interpretation. References to sections, subsections, clauses,
sub-clauses, paragraphs and subparagraphs are to such sections, subsections,
clauses, sub-clauses, paragraphs and subparagraphs contained in this Part I or
Part II hereof, as the case may be, unless specifically identified otherwise.

                          PART II: AUCTION PROCEDURES

    1. Certain Definitions. As used in Part II of these Articles Supplementary,
the following terms will have the following meanings, unless the context
otherwise requires and all section references below are to Part II of these
Articles Supplementary except as otherwise indicated: Capitalized terms not
defined in Section 1 of Part II of these Articles Supplementary will have the
respective meanings specified in Part I of these Articles Supplementary.

        'Agent Member' means a member of or participant in the Securities
    Depository that will act on behalf of Existing Holders or Potential Holders
    of shares of the Series.

        'Available Shares of the Series' has the meaning set forth in Section
    4(a)(i) of Part II of these Articles Supplementary.

        'Existing Holder' means (a) a person who beneficially owns those shares
    of the Series listed in that person's name in the records of the Auction
    Agent or (b) the beneficial owner of those shares of the Series which are
    listed under such person's Broker-Dealer's name in the records of the
    Auction Agent, which Broker-Dealer will have signed a Master Purchaser's
    Letter.

        'Hold Order' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary.

        'Master Purchaser's Letter' means the letter which is required to be
    executed by each prospective purchaser of shares of the Series or the
    Broker-Dealer through whom the shares will be held.

        'Order' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary.

        'Potential Holder,' means (a) any Existing Holder who may be interested
    in acquiring additional shares of the Series or (b) any other person who may
    be interested in acquiring shares of the Series and who has signed a Master
    Purchaser's Letter or whose shares will be listed under such person's
    Broker-Dealer's name on the records of the Auction Agent which Broker-Dealer
    will have executed a Master Purchaser's Letter.

        'Sell Order' has the meaning set forth in Section 2(a)(ii) of Part II of
    these Articles Supplementary.

        'Submitted Bid Order' has the meaning set forth in Section 4(a) of
    Part II of these Articles Supplementary.

        'Submitted Hold Order' has the meaning set forth in Section 4(a) of
    Part II of these Articles Supplementary.

        'Submitted Order' has the meaning set forth in Section 4(a) of Part II
    of these Articles Supplementary.

                                      B-29





<PAGE>


        'Submitted Sell Order' has the meaning set forth in Section 4(a) of
    Part II of these Articles Supplementary.

        'Sufficient Clearing Orders' means that all shares of the Series are the
    subject of Submitted Hold Orders or that the number of shares of the Series
    that are the subject of Submitted Buy Orders by Potential Holders specifying
    one or more rates equal to or less than the Maximum Rate exceeds or equals
    the sum of (A) the number of shares of the Series that are subject of
    Submitted Hold/Sell Orders by Existing Holders specifying one or more rates
    higher than the Maximum Applicable Rate and (B) the number of shares of the
    Series that are subject to Submitted Sell Orders.

        'Winning Bid Rate' means the lowest rate specified in the Submitted
    Orders which, if (A) each Submitted Hold/Sell Order from Existing Holders
    specifying such lowest rate and all other Submitted Hold/Sell Orders from
    Existing Holders specifying lower rates were accepted and (B) each Submitted
    Buy Order from Potential Holders specifying such lowest rate and all other
    Submitted Buy Orders from Potential Holders specifying lower rates were
    accepted, would result in the Existing Holders described in clause (A) above
    continuing to hold an aggregate number of shares of the Series which, when
    added to the number of shares of the Series to be purchased by the Potential
    Holders described in clause (B) above and the number of shares of the Series
    subject to Submitted Hold Orders, would be equal to the number of shares of
    the Series.

    2. Orders.

    (a) On or prior to the Submission Deadline on each Auction Date for shares
of the Series:

        (i) each Beneficial Owner of shares of the Series may submit to its
    Broker-Dealer by telephone or otherwise information as to:

           (A) the number of Outstanding shares, if any, of the Series held by
       such Beneficial Owner which such Beneficial Owner desires to continue to
       hold without regard to the Applicable Rate for such shares for the next
       succeeding Dividend Period of such shares;

           (B) the number of Outstanding shares, if any, of the Series held by
       such Beneficial Owner which such Beneficial Owner offers to sell if the
       Applicable Rate for such shares for the next succeeding Dividend Period
       of such shares will be less than the rate per annum specified by such
       Beneficial Owner; and/or

           (C) the number of Outstanding shares, if any, of the Series held by
       such Beneficial Owner which such Beneficial Owner offers to sell without
       regard to the Applicable Rate for such shares for the next succeeding
       Dividend Period of such shares; and

        (ii) each Broker-Dealer, using lists of Potential Beneficial Owners,
    will in good faith for the purpose of conducting a competitive Auction in a
    commercially reasonable manner, contact Potential Beneficial Owners (by
    telephone or otherwise), including Persons that are not Beneficial Owners,
    on such lists to determine the number of shares, if any, of the Series which
    each such Potential Beneficial Owner offers to purchase if the Applicable
    Rate for such shares for the next succeeding Dividend Period of such shares
    will not be less than the rate per annum specified by such Potential
    Beneficial Owner.

        For the purposes hereof, the communication by a Beneficial Owner or
    Potential Beneficial Owner to a Broker-Dealer, or by a Broker-Dealer to the
    Auction Agent, of information referred to in clause (i)(A), (i)(B), (i)(C)
    or (ii) of this paragraph (a) is hereinafter referred to as an 'Order' and
    collectively as 'Orders' and each Beneficial Owner and each Potential
    Beneficial Owner placing an Order with a Broker-Dealer, and such
    Broker-Dealer placing an Order with the Auction Agent, is hereinafter
    referred to as a 'Bidder' and collectively as 'Bidders'; an Order containing
    the information referred to in clause (i)(A) of this paragraph (a) is
    hereinafter referred to as a 'Hold Order' and collectively as 'Hold Orders';
    an Order containing the information referred to in clause (i)(B) or (ii) of
    this paragraph (a) is hereinafter referred to as a 'Bid' and collectively as
    'Bids'; and an Order containing the

                                      B-30





<PAGE>


    information referred to in clause (i)(C) of this paragraph (a) is
    hereinafter referred to as a 'Sell Order' and collectively as 'Sell Orders.'

    (b) (i) A Bid by a Beneficial Owner or an Existing Holder of shares of the
Series subject to an Auction on any Auction Date will constitute an irrevocable
offer to sell:

        (A) the number of Outstanding shares of the Series specified in such Bid
    if the Applicable Rate for shares of the Series determined on such Auction
    Date will be less than the rate specified therein;

        (B) such number or a lesser number of Outstanding shares of the Series
    to be determined as set forth in clause (iv) of paragraph (a) of Section 5
    of this Part II if the Applicable Rate for such shares determined on such
    Auction Date will be equal to the rate specified therein; or

        (C) the number of Outstanding shares of the Series specified in such Bid
    if the rate specified therein will be higher than the Maximum Rate for such
    shares, or such number or a lesser number of Outstanding shares of the
    Series to be determined as set forth in clause (iii) of paragraph (b) of
    Section 5 of this Part II if the rate specified therein will be higher than
    the Maximum Rate for such shares and Sufficient Clearing Bids for such
    shares do not exist.

    (ii) A Sell Order by a Beneficial Owner or an Existing Holder of shares of
the Series subject to an Auction on any Auction Date will constitute an
irrevocable offer to sell:

        (A) the number of Outstanding shares of the Series specified in such
    Sell Order; or

        (B) such number or a lesser number of Outstanding shares of the Series
    as set forth in clause (iii) of paragraph (b) of Section 5 of this Part II
    if Sufficient Clearing Bids for such shares do not exist;

provided, however, that a Broker-Dealer that is an Existing Holder with respect
to shares of the Series will not be liable to any Person for failing to sell
such shares pursuant to a Sell Order described in the proviso to paragraph (c)
of Section 3 of this Part II if (1) such shares were transferred by the
Beneficial Owner thereof without compliance by such Beneficial Owner or its
transferee Broker-Dealer (or other transferee person, if permitted by the
Corporation) with the provisions of Section 6 of this Part II or (2) such
Broker-Dealer has informed the Auction Agent pursuant to the terms of its
Broker-Dealer Agreement that, according to such Broker-Dealer's records, such
Broker-Dealer believes it is not the Existing Holder of such shares.

    (iii)A Bid by a Potential Holder of shares of the Series subject to an
Auction on any Auction Date will constitute an irrevocable offer to purchase:

        (A) the number of Outstanding shares of the Series specified in such Bid
    if the Applicable Rate for such shares determined on such Auction Date will
    be higher than the rate specified therein; or (B) such number or a lesser
    number of Outstanding shares of the Series as set forth in clause (v) of
    paragraph (a) of Section 5 of this Part II if the Applicable Rate for such
    shares determined on such Auction Date will be equal to the rate specified
    therein.

    (c) No Order for any number of shares of the Series other than whole shares
will be valid.

    3. Submission of Orders by Broker-Dealers to Auction Agent.

    (a) Each Broker-Dealer will submit in writing to the Auction Agent prior to
the Submission Deadline on each Auction Date all Orders for shares of the Series
subject to an Auction on such Auction Date obtained by such Broker-Dealer,
designating itself (unless otherwise permitted by the Corporation) as an
Existing Holder in respect of shares subject to Orders submitted or deemed
submitted to it by Beneficial Owners and as a Potential Holder in respect of
shares subject to Orders submitted to it by Potential Beneficial Owners, and
will specify with respect to each Order for such shares:

        (i) the name of the Bidder placing such Order (which will be the
    Broker-Dealer unless otherwise permitted by the Corporation);

        (ii) the aggregate number of shares of the Series that are the subject
    of such Order;

                                      B-31





<PAGE>



        (iii) to the extent that such Bidder is an Existing Holder of such
    shares:

           (A) the number of shares of the Series, if any, subject to any Hold
       Order of such Existing Holder;

           (B) the number of shares of the Series, if any, subject to any Bid of
       such Existing Holder and the rate specified in such Bid; and

           (C) the number of shares of the Series, if any, subject to any Sell
       Order of such Existing Holder; and

        (iv) to the extent such Bidder is a Potential Holder of such shares, the
    rate and number of such shares specified in such Potential Holder's Bid.

    (b) If any rate specified in any Bid contains more than three figures to the
right of the decimal point, the Auction Agent will round such rate up to the
next highest one thousandth (.001) of 1%.

    (c) If an Order or Orders covering all of the Outstanding shares of the
Series held by any Existing Holder is not submitted to the Auction Agent prior
to the Submission Deadline, the Auction Agent will deem a Hold Order to have
been submitted by or on behalf of such Existing Holder covering the number of
Outstanding shares of the Series held by such Existing Holder and not subject to
Orders submitted to the Auction Agent; provided, however, that if an Order or
Orders covering all of the Outstanding shares of the Series held by any Existing
Holder is not submitted to the Auction Agent prior to the Submission Deadline
for an Auction relating to a Special Dividend Period consisting of more than 91
Dividend Period days, the Auction Agent will deem a Sell Order to have been
submitted by or on behalf of such Existing Holder covering the number of
outstanding shares of the Series held by such Existing Holder and not subject to
Orders submitted to the Auction Agent.

    (d) If one or more Orders of an Existing Holder is submitted to the Auction
Agent covering in the aggregate more than the number of Outstanding shares of
the Series subject to an Auction held by such Existing Holder, such Orders will
be considered valid in the following order of priority:

        (i) all Hold Orders for such shares will be considered valid, but only
    up to and including in the aggregate the number of Outstanding shares of the
    Series held by such Existing Holder, and if the number of shares of the
    Series subject to such Hold Orders exceeds the number of Outstanding shares
    of the Series held by such Existing Holder, the number of shares subject to
    each such Hold Order will be reduced pro rata to cover the number of
    Outstanding shares of the Series held by such Existing Holder;

        (ii) (A) any Bid for shares of the Series will be considered valid up to
    and including the excess of the number of Outstanding shares of the Series
    held by such Existing Holder over the number of shares of the Series subject
    to any Hold Orders referred to in clause (i) above;

           (B) subject to subclause (A), if more than one Bid of an Existing
       Holder for shares of the Series is submitted to the Auction Agent with
       the same rate and the number of Outstanding shares of the Series subject
       to such Bids is greater than such excess, such Bids will be considered
       valid up to and including the amount of such excess, and the number of
       shares of the Series subject to each Bid with the same rate will be
       reduced pro rata to cover the number of shares of the Series equal to
       such excess;

           (C) subject to subclauses (A) and (B), if more than one Bid of an
       Existing Holder for shares of the Series is submitted to the Auction
       Agent with different rates, such Bids will be considered valid in the
       ascending order of their respective rates up to and including the amount
       of such excess; and

           (D) in any such event, the number, if any, of such Outstanding shares
       of the Series subject to any portion of Bids considered not valid in
       whole or in part under this clause (ii) will be treated as the subject of
       a Bid for shares of the Series by or on behalf of a Potential Holder at
       the rate therein specified; and

                                      B-32





<PAGE>



        (iii) all Sell Orders for shares of the Series will be considered valid
    up to and including the excess of the number of Outstanding shares of the
    Series held by such Existing Holder over the sum of shares of the Series
    subject to valid Hold Orders referred to in clause (i) above and valid Bids
    referred to in clause (ii) above.

    (e) If more than one Bid for one or more shares of the Series is submitted
to the Auction Agent by or on behalf of any Potential Holder, each such Bid
submitted will be a separate Bid with the rate and number of shares therein
specified.

    (f) Any Order submitted by a Beneficial Owner or a Potential Beneficial
Owner to its Broker-Dealer, or by a Broker-Dealer to the Auction Agent, prior to
the Submission Deadline on any Auction Date, will be irrevocable.

    4. Determination of Sufficient Clearing Bids, Winning Bid Rate and
Applicable Rate.

    (a) Not earlier than the Submission Deadline on each Auction Date for shares
of the Series, the Auction Agent will assemble all valid Orders submitted or
deemed submitted to it by the Broker-Dealers in respect of shares of the Series
(each such Order as submitted or deemed submitted by a Broker-Dealer being
hereinafter referred to individually as a 'Submitted Hold Order,' a 'Submitted
Bid' or a 'Submitted Sell Order,' as the case may be, or as a 'Submitted Order'
and collectively as 'Submitted Hold Orders,' 'Submitted Bids' or 'Submitted Sell
Orders,' as the case may be, or as 'Submitted Orders') and will determine for
the Series:

        (i) the excess of the number of Outstanding shares of the Series over
    the number of Outstanding shares of the Series subject to Submitted Hold
    Orders (such excess being hereinafter referred to as the 'Available Shares
    of the Series');

        (ii) from the Submitted Orders for shares of the Series whether:

           (A) the number of Outstanding shares of the Series subject to
       Submitted Bids of Potential Holders specifying one or more rates equal to
       or lower than the Maximum Rate (for all Dividend Periods) for shares of
       the Series; exceeds or is equal to the sum of

           (B) the number of Outstanding shares of the Series subject to
       Submitted Bids of Existing Holders specifying one or more rates higher
       than the Maximum Rate (for all Dividend Periods) for shares of the
       Series; and

           (C) the number of Outstanding shares of the Series subject to
       Submitted Sell Orders(in the event such excess or such equality exists
       (other than because the number of shares of the Series in subclauses (B)
       and (C) above is zero because all of the Outstanding shares of the Series
       are subject to Submitted Hold Orders), such Submitted Bids in subclause
       (A) above being hereinafter referred to collectively as 'Sufficient
       Clearing Bids' for shares of the Series); and

        (iii) if Sufficient Clearing Bids for shares of the Series exist, the
    lowest rate specified in such Submitted Bids (the 'Winning Bid Rate' for
    shares of the Series) which if:

           (A) (I) each such Submitted Bid of Existing Holders specifying such
       lowest rate and (II) all other such Submitted Bids of Existing Holders
       specifying lower rates were rejected, thus entitling such Existing
       Holders to continue to hold the shares of the Series that are subject to
       such Submitted Bids; and

           (B) (I) each such Submitted Bid of Potential Holders specifying such
       lowest rate and (II) all other such Submitted Bids of Potential Holders
       specifying lower rates were accepted; would result in such Existing
       Holders described in subclause (A) above continuing to hold an aggregate
       number of Outstanding shares of the Series which, when added to the
       number of Outstanding shares of the Series to be purchased by such
       Potential Holders described in subclause (B) above, would equal not less
       than the Available Shares of the Series.

    (b) Promptly after the Auction Agent has made the determinations pursuant to
paragraph (a)of this Section 4, the Auction Agent will advise the Corporation of
the Maximum Rate for shares of the Series for which an Auction is being held on
the Auction Date and, based on such

                                      B-33





<PAGE>



determination, the Applicable Rate for shares of the Series for the next
succeeding Dividend Period thereof as follows:

        (i) if Sufficient Clearing Bids for shares of the Series exist, that the
    Applicable Rate for all shares of the Series for the next succeeding
    Dividend Period thereof will be equal to the Winning Bid Rate for shares of
    the Series so determined;

        (ii) if Sufficient Clearing Bids for shares of the Series do not exist
    (other than because all of the Outstanding shares of the Series are subject
    to Submitted Hold Orders), that the Applicable Rate for all shares of the
    Series for the next succeeding Dividend Period thereof will be equal to the
    Maximum Rate for shares of the Series; or

        (iii) if all of the Outstanding shares of the Series are subject to
    Submitted Hold Orders, that the Applicable Rate for all shares of the Series
    for the next succeeding Dividend Period thereof will be the All Hold Rate.

    5. Acceptance and Rejection of Submitted Bids and Submitted Sell Orders and
Allocation. Existing Holders will continue to hold the shares of the Series that
are subject to Submitted Hold Orders, and, based on the determinations made
pursuant to paragraph (a) of Section 4 of this Part II, the Submitted Bids and
Submitted Sell Orders will be accepted or rejected by the Auction Agent and the
Auction Agent will take such other action as set forth below:

        (a) If Sufficient Clearing Bids for shares of the Series have been made,
    all Submitted Sell Orders with respect to shares of the Series will be
    accepted and, subject to the provisions of paragraphs (d) and (e) of this
    Section 5, Submitted Bids with respect to shares of the Series will be
    accepted or rejected as follows in the following order of priority and all
    other Submitted Bids with respect to shares of the Series will be rejected:

           (i) Existing Holders' Submitted Bids for shares of the Series
       specifying any rate that is higher than the Winning Bid Rate for shares
       of the Series will be accepted, thus requiring each such Existing Holder
       to sell the shares of the Series subject to such Submitted Bids;

           (ii) Existing Holders' Submitted Bids for shares of the Series
       specifying any rate that is lower than the Winning Bid Rate for shares of
       the Series will be rejected, thus entitling each such Existing Holder to
       continue to hold the shares of the Series subject to such Submitted Bids;

           (iii)Potential Holders' Submitted Bids for shares of the Series
       specifying any rate that is lower than the Winning Bid Rate for shares of
       the Series will be accepted;

           (iv) each Existing Holder's Submitted Bid for shares of the Series
       specifying a rate that is equal to the Winning Bid Rate for shares of the
       Series will be rejected, thus entitling such Existing Holder to continue
       to hold shares of the Series subject to such Submitted Bid, unless the
       number of Outstanding shares of the Series subject to all such Submitted
       Bids will be greater than the number of shares of the Series ('remaining
       shares') in the excess of the Available Shares of the Series over the
       number of shares of the Series subject to Submitted Bids described in
       clauses (ii) and (iii) of this paragraph (a), in which event such
       Submitted Bid of such Existing Holder will be rejected in part, and such
       Existing Holder will be entitled to continue to hold shares of the Series
       subject to such Submitted Bid, but only in an amount equal to the shares
       of the Series obtained by multiplying the number of remaining shares by a
       fraction, the numerator of which will be the number of Outstanding shares
       of the Series held by such Existing Holder subject to such Submitted Bid
       and the denominator of which will be the aggregate number of Outstanding
       shares of the Series subject to such Submitted Bids made by all such
       Existing Holders that specified a rate equal to the Winning Bid Rate for
       shares of the Series; and

           (v) each Potential Holder's Submitted Bid for shares of the Series
       specifying a rate that is equal to the Winning Bid Rate for shares of the
       Series will be accepted but only in an amount equal to the number of
       shares of the Series obtained by multiplying the number of shares in the
       excess of the Available Shares of the Series over the number of

                                      B-34





<PAGE>



       shares of the Series subject to Submitted Bids described in clauses (ii)
       through (iv) of this paragraph (a) by a fraction, the numerator of which
       will be the number of Outstanding shares of the Series subject to such
       Submitted Bid and the denominator of which will be the aggregate number
       of Outstanding shares of the Series subject to such Submitted Bids made
       by all such Potential Holders that specified a rate equal to the Winning
       Bid Rate for shares of the Series.

        (b) If Sufficient Clearing Bids for shares of the Series have not been
    made (other than because all of the Outstanding shares of the Series are
    subject to Submitted Hold Orders), subject to the provisions of paragraph
    (d) of this Section 5, Submitted Orders for shares of the Series will be
    accepted or rejected as follows in the following order of priority and all
    other Submitted Bids for shares of the Series will be rejected:

           (i) Existing Holders' Submitted Bids for shares of the Series
       specifying any rate that is equal to or lower than the Maximum Rate for
       shares of the Series will be rejected, thus entitling such Existing
       Holders to continue to hold the shares of the Series subject to such
       Submitted Bids;

           (ii) Potential Holders' Submitted Bids for shares of the Series
       specifying any rate that is equal to or lower than the Maximum Rate for
       shares of the Series will be accepted; and

           (iii) Each Existing Holder's Submitted Bid for shares of the Series
       specifying any rate that is higher than the Maximum Rate for shares of
       the Series and the Submitted Sell Orders for shares of the Series of each
       Existing Holder will be accepted, thus entitling each Existing Holder
       that submitted or on whose behalf was submitted any such Submitted Bid or
       Submitted Sell Order to sell the shares of the Series subject to such
       Submitted Bid or Submitted Sell Order, but in both cases only in an
       amount equal to the number of shares of the Series obtained by
       multiplying the number of shares of the Series subject to Submitted Bids
       described in clause (ii) of this paragraph (b) by a fraction, the
       numerator of which will be the number of Outstanding shares of the Series
       held by such Existing Holder subject to such Submitted Bid or Submitted
       Sell Order and the denominator of which will be the aggregate number of
       Outstanding shares of the Series subject to all such Submitted Bids and
       Submitted Sell Orders.

        (c) If all of the Outstanding shares of the Series are subject to
    Submitted Hold Orders, all Submitted Bids for shares of the Series will be
    rejected.

        (d) If, as a result of the procedures described in clause (iv) or (v) of
    paragraph (a) or clause (iii) of paragraph (b) of this Section 5, any
    Existing Holder would be entitled or required to sell, or any Potential
    Holder would be entitled or required to purchase, a fraction of a share of
    the Series on any Auction Date, the Auction Agent will, in such manner as it
    will determine in its sole discretion, round up or down the number of shares
    of the Series to be purchased or sold by any Existing Holder or Potential
    Holder on such Auction Date as a result of such procedures so that the
    number of shares so purchased or sold by each Existing Holder or Potential
    Holder on such Auction Date will be whole shares of the Series.

        (e) If, as a result of the procedures described in clause (v) of
    paragraph (a) of this Section 5 any Potential Holder would be entitled or
    required to purchase less than a whole share of the Series on any Auction
    Date, the Auction Agent will, in such manner as it will determine in its
    sole discretion, allocate shares of the Series for purchase among Potential
    Holders so that only whole shares of the Series are purchased on such
    Auction Date as a result of such procedures by any Potential Holder, even if
    such allocation results in one or more Potential Holders not purchasing
    shares of the Series on such Auction Date.

        (f) Based on the results of each Auction for shares of the Series, the
    Auction Agent will determine the aggregate number of shares of the Series to
    be purchased and the aggregate number of shares of the Series to be sold by
    Potential Holders and Existing Holders and, with respect to each Potential
    Holder and Existing Holder, to the extent that such aggregate number of
    shares to be purchased and such aggregate number of shares to be sold
    differ,

                                      B-35





<PAGE>



    determine to which other Potential Holder(s) or Existing Holder(s) they will
    deliver, or from which other Potential Holder(s) or Existing Holder(s) they
    will receive, as the case may be, shares of the Series. Notwithstanding any
    provision of the Auction Procedures or the Settlement Procedures to the
    contrary, in the event an Existing Holder or Beneficial Owner of shares of
    the Series with respect to whom a Broker-Dealer submitted a Bid to the
    Auction Agent for such shares that was accepted in whole or in part, or
    submitted or is deemed to have submitted a Sell Order for such shares that
    was accepted in whole or in part, fails to instruct its Agent Member to
    deliver such shares against payment therefor, partial deliveries of shares
    of the Series that have been made in respect of Potential Holders' or
    Potential Beneficial Owners' Submitted Bids for shares of the Series that
    have been accepted in whole or in part will constitute good delivery to such
    Potential Holders and Potential Beneficial Owners.

        (g) Neither the Corporation nor the Auction Agent nor any affiliate of
    either will have any responsibility or liability with respect to the failure
    of an Existing Holder, a Potential Holder, a Beneficial Owner, a Potential
    Beneficial Owner or its respective Agent Member to deliver any shares of the
    Series or to pay for shares of the Series sold or purchased pursuant to the
    Auction Procedures or otherwise.

    6. Transfer of AMPS. Unless otherwise permitted by the Corporation, a
Beneficial Owner or an Existing Holder may sell, transfer or otherwise dispose
of shares of the Series only in whole shares and only pursuant to a Bid or Sell
Order placed with the Auction Agent in accordance with the procedures described
in this Part II or to a Broker-Dealer; provided, however, that (a) a sale,
transfer or other disposition of shares of the Series from a customer of a
Broker-Dealer who is listed on the records of that Broker-Dealer as the holder
of such shares to that Broker-Dealer or another customer of that Broker-Dealer
will not be deemed to be a sale, transfer or other disposition for purposes of
this Section 6 if such Broker-Dealer remains the Existing Holder of the shares
so sold, transferred or disposed of immediately after such sale, transfer or
disposition and (b) in the case of all transfers other than pursuant to
Auctions, the Broker-Dealer (or other Person, if permitted by the Corporation)
to whom such transfer is made will advise the Auction Agent of such transfer.

                         [Remainder of page left blank]

                                      B-36





<PAGE>



    IN WITNESS WHEREOF, COHEN & STEERS QUALITY INCOME REALTY FUND, INC. has
caused these presents to be signed in its name and on its behalf by its Vice
President and witnessed by its Assistant Secretary as of this  day of  , 2004.

WITNESS:

By:  ..............................
   Name: Lawrence B. Stoller
   Title: Assistant Secretary

                                          COHEN & STEERS QUALITY
                                          INCOME REALTY FUND, INC.

                                          By: .................................
                                            Name: Adam Derechin
                                            Title: Vice President

    THE UNDERSIGNED, Vice President of the COHEN & STEERS QUALITY INCOME REALTY
FUND, INC., who executed on behalf of the Corporation the foregoing Articles
Supplementary hereby acknowledges the foregoing Articles Supplementary to be the
corporate act of the Corporation and hereby certifies to the best of his
knowledge, information, and belief that the matters and facts set forth herein
with respect to the authorization and approval thereof are true in all material
respects under the penalties of perjury.

                                          By: .................................
                                            Name: Adam Derechin
                                            Title: Vice President
                                       B-37




</TEXT>
</DOCUMENT>
