<DOCUMENT>
<TYPE>EX-99.2D
<SEQUENCE>3
<FILENAME>ex2di.txt
<DESCRIPTION>EXHIBIT 2(D)(I)
<TEXT>

<PAGE>

                             ARTICLES SUPPLEMENTARY

               COHEN & STEERS REIT AND PREFERRED INCOME FUND, INC.

       Articles Supplementary Creating And Fixing The Rights of Series M7,
    Series T7, Series W7, Series TH7, Series F7, Series W28A, Series W28B and
               Series W28C Taxable Auction Market Preferred Shares

     Cohen & Steers REIT and Preferred Income 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,
(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, 24,800 shares of the Corporation's Taxable Auction
Market Preferred Shares (par value $.001 per share) (the "AMPS") and has further
classified 3,280 of such shares as "Series M7 AMPS", liquidation preference
$25,000 per share, 3,280 of such shares as "Series T7 AMPS", liquidation
preference $25,000 per share, 3,280 of such shares as "Series W7 AMPS",
liquidation preference $25,000 per share, 3,280 of such shares as "Series TH7
AMPS", liquidation preference $25,000 per share, 3,280 of such shares as "Series
F7 AMPS", liquidation preference $25,000 per share, 2,800 of such shares as
"Series W28A AMPS", liquidation preference $25,000 per share, 2,800 of such
shares as "Series W28B AMPS", liquidation preference $25,000 per share and 2,800
of such shares as "Series W28C AMPS", liquidation preference $25,000 per share
(respectively the "Series M7 AMPS", the "Series T7 AMPS", the "Series W7 AMPS",
the "Series TH7 AMPS", the "Series F7 AMPS", the "Series W28A AMPS", the "Series
W28B AMPS" and the "Series W28C AMPS", and each a "Series" of Taxable Auction
Market Preferred Shares, and, together, the "AMPS").

     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 AMPS for each Series,
as set forth herein.

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

                                   DESIGNATION

     Series M7 AMPS: A series of 3,280 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series M7
Taxable Auction Market Preferred Shares" ("Series M7 AMPS"). Each share of
Series M7 AMPS 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,


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<PAGE>

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 M7 AMPS will constitute a separate series of AMPS of
the Corporation.

     Series T7 AMPS: A series of 3,280 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series T7
Taxable Auction Market Preferred Shares" ("Series T7 AMPS"). Each share of
Series T7 AMPS 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 T7 AMPS will
constitute a separate series of AMPS of the Corporation.

     Series W7 AMPS: A series of 3,280 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series W7
Taxable Auction Market Preferred Shares" ("Series W7 AMPS"). Each share of
Series W7 AMPS 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 W7 AMPS will
constitute a separate series of AMPS of the Corporation.

     Series TH7 AMPS: A series of 3,280 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series TH7
Taxable Auction Market Preferred Shares" ("Series TH7 AMPS"). Each share of
Series TH7 AMPS 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 TH7 AMPS will
constitute a separate series of AMPS of the Corporation.

     Series F7 AMPS: A series of 3,280 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series F7
Taxable Auction Market Preferred Shares" ("Series F7 AMPS"). Each share of
Series F7 AMPS 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


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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 F7 AMPS will constitute a separate series of
AMPS of the Corporation.

     Series W28A AMPS: A series of 2,800 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series W28A
Taxable Auction Market Preferred Shares" ("Series W28A AMPS"). Each share of
Series W28A AMPS 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 W28A AMPS will
constitute a separate series of AMPS of the Corporation.

     Series W28B AMPS: A series of 2,800 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series W28B
Taxable Auction Market Preferred Shares" ("Series W28B AMPS"). Each share of
Series W28B AMPS 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 W28B AMPS will
constitute a separate series of AMPS of the Corporation.

     Series W28C AMPS: A series of 2,800 AMPS, par value $.001 per share,
liquidation preference $25,000 per share, is hereby designated "Series W28C
Taxable Auction Market Preferred Shares" ("Series W28C AMPS"). Each share of
Series W28C AMPS 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 W28C AMPS 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


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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.

                              Part I: Terms of AMPS

     1.   Number of Shares; Ranking.

     (a) The initial number of authorized shares constituting the Series M7 AMPS
is 3,280 shares, the initial number of authorized shares constituting the Series
T7 AMPS is 3,280 shares, the initial number of authorized shares constituting
the Series W7 AMPS is 3,280 shares, the initial number of authorized shares
constituting the Series TH7 AMPS is 3,280 shares, the initial number of
authorized shares constituting the Series F7 AMPS is 3,280 shares, the initial
number of authorized shares constituting the Series W28A AMPS is 2,800 shares,
the initial number of authorized shares constituting the Series W28B AMPS is
2,800 shares and the initial number of authorized shares constituting the Series
W28C AMPS is 2,800 shares. No fractional shares of any Series will be issued.

     (b) Shares of each 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 each 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 any 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 any 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 each 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 each 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 each Series, as follows:


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               (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
          the first Business Day of each calendar month within such period, 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
          the first Business Day of each calendar month 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 a Series,
     an aggregate amount of immediately available funds equal to the dividends
     to be paid to all Holders of such 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 each Series will be paid on the Dividend Payment
     Date therefor to the Holders of that 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 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 each 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 each 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 a 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
any 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
that Series for any such Dividend Period will be the Maximum Rate (except (i)
during a


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<PAGE>

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 Fund 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 a particular 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 that 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
     applicable to that Series.

          (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 each 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 (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


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<PAGE>

     360 for each Series, multiplying the amount so obtained by $25,000, and
     rounding the amount so obtained to the nearest cent.

     (d) Any dividend payment made on shares of any Series will first be
credited against the earliest accumulated but unpaid dividends due with respect
to that Series.

     (e) For so long as the AMPS 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 AMPS as to dividends or upon liquidation) with respect to Common
Shares or any other capital stock of the Corporation ranking junior to the AMPS
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 AMPS (except by conversion into or exchange for shares of
the Corporation ranking junior to the AMPS 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 AMPS 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 AMPS 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 the AMPS 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 AMPS for any period unless full cumulative dividends have
been or contemporaneously are declared and paid on each Series through their
most recent Dividend Payment Date. When dividends are not paid in full upon the
AMPS through their most recent Dividend Payment Dates or upon any other series
of stock ranking on a parity as to the payment of dividends with AMPS through
their most recent respective Dividend Payment Dates, all dividends declared upon
the AMPS and any other such series of stock ranking on a parity as to the
payment of dividends with the AMPS will be declared pro rata so that the amount
of dividends declared per share on the AMPS 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 AMPS 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 any 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


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<PAGE>

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 any
Series will be 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 each Series by reason of the redemption of each 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 AMPS will be subject to mandatory
     redemption out of funds legally available therefor. The number of AMPS to
     be redeemed in such circumstances will be equal to the lesser of (A) the
     minimum number of AMPS 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 AMPS then
     Outstanding will be redeemed) and (B) the maximum number of AMPS 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 AMPS 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


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<PAGE>

     Act Preferred Shares Asset Coverage, as the case may be, pro rata or among
     the Holders of the AMPS 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 AMPS 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 AMPS, 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 AMPS to be
     redeemed and the Paying Agent. The Corporation will deposit with the Paying
     Agent funds sufficient to redeem the specified number of AMPS 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 Business Day immediately preceding
     the Mandatory Redemption Date. If fewer than all of the Outstanding AMPS
     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 AMPS 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 and Rating Agencies (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 any 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


                                        9




<PAGE>

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 any 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 each 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 AMPS, may be redeemed at the option of the
Corporation unless all dividends in arrears on the Outstanding AMPS 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 any 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 for
redemption, any cash deposited with the Paying Agent in excess of (i) the
aggregate redemption price of the shares of any Series called for redemption on
such date and (ii) such other amounts, if any, to which Holders of shares of any
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 each 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,


                                       10




<PAGE>

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 any 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 each Series for which a Notice of Redemption has been
given, dividends may be declared and paid on shares of any Series and will
include those shares of any 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 any 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 any 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 each 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 each 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 any 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 each 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 AMPS 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 Outstanding
AMPS) 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


                                       11




<PAGE>

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 AMPS 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 each Series will be as determined in
the manner set forth under "Designation" above. The Corporation will designate
the duration of subsequent Dividend Periods of each 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, each 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, 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, Merrill Lynch, Pierce,
Fenner & Smith Incorporated, or any successor Broker-Dealer designated by the
Corporation, will have notified the Corporation in writing that it does not
object to the designation of such Special Dividend Period 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 AMPS.

     (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 (ii)
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


                                       12




<PAGE>

          (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.

     5. Restrictions on Transfer. Shares of each 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 any Series through
different Broker-Dealers, advises the Auction Agent of such transfer. The
certificates representing the shares of each 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 any Series will be entitled to one
vote for each share of any Series held on each matter on which the Holders of
the AMPS are entitled to vote, and (ii) the holders of the Outstanding shares of
preferred stock, including each 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
each Series, 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 each 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 each 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 AMPS will be unpaid in an amount equal
to two full years' dividends on the AMPS (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 each 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
each 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


                                       13




<PAGE>

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 each 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
each 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 each 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 each Series, held during a Voting Period at which
directors are to be elected, such holders, voting 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 AMPS, 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 each 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 each
Series, is required, no holder of shares of preferred stock, including each
Series, will be entitled to vote and no share of preferred stock, including each
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 AMPS 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 AMPS 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.


                                       14




<PAGE>

     (f) Simultaneously with the termination of a Voting Period, the terms of
office of the additional directors elected by the Holders of the AMPS 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 AMPS 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 AMPS of the Corporation or
fails to redeem any AMPS which it is required to redeem, or any other event
occurs which requires the mandatory redemption of AMPS 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 AMPS 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
AMPS 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 each Series,
are outstanding, the Corporation will not, without the affirmative vote of the
Holders of a majority of the outstanding preferred stock, (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 (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 AMPS, (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


                                       15




<PAGE>

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 each Series,
voting 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 each 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 each Series, and any such amendment, alteration or
repeal will not be deemed to affect the preferences, rights or powers of AMPS 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 any 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 each Series, or any other stockholder of the Corporation, but
only with confirmation from each Rating Agency, and after consultation with the
Broker-Dealers, provided that immediately following any such increase the
Corporation would meet the Preferred Shares Basic Maintenance Amount Test.


                                       16




<PAGE>

     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 each 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. Each Series will rank on a parity
with shares of any other series of preferred stock of the Corporation (including
each Series) 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 each 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 each 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 each 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 AMPS of the full preferential amounts
provided for in this Section 7, the Holders of the AMPS 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 AMPS, 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 AMPS, 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.


                                       17




<PAGE>

     (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 AMPS as provided
in paragraph (a) of this Section 7, but not prior thereto, any other series or
class of shares ranking junior to the AMPS 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 AMPS will not be entitled to share
therein.

     8. Auction Agent. For so long as any AMPS 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, 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 any
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 Fund may remove the
auction agent provided that prior to such removal the Fund 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 AMPS 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 AMPS 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 AMPS 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 AMPS), Moody's (if Moody's is then rating the AMPS)
and (if applicable) such Other Rating Agency, that any such action would not
impair the rating then assigned by such Rating Agency to the AMPS, 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 AMPS, issue additional
shares of any series of preferred stock, including any Series or reissue any
shares of preferred stock, including any Series previously purchased or redeemed
by the Corporation;

     (c) engage in any short sales of securities;


                                       18




<PAGE>

     (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 AMPS, 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 AMPS 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
rating the AMPS); (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 any AMPS are rated by S&P and Moody's, 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 and Moody's that engaging in such transactions
will not impair the ratings then assigned to the AMPS by S&P and Moody's.

     (h) Change the pricing service referred to in the definition of Market
Value.

     (i) Enter into reverse repurchase agreements.

     12. Compliance Procedures for Asset Maintenance Tests. For so long as any
AMPS 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


                                       19




<PAGE>

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 AMPS 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 AMPS which
are deemed to be Outstanding hereunder.

     (d) The Corporation will deliver to 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) on or before
the 5th business day after the Date of Original Issue, (B) the last Valuation
Date of each month (such monthly report to include the net asset value and trade
price as of that date), (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 or AMPS 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.

     (e) The Corporation will deliver to 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 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.

     (f) Within fifteen Business Days of the Date of Original Issue and any
redemption of AMPS, the Corporation will deliver to 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 fifteen Business Days after delivery of the
Preferred Shares Basic Maintenance Certificate and the 1940 Act Preferred Shares
Asset


                                       20




<PAGE>

Coverage Certificate relating to the last Valuation Date of each fiscal
year 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 year. 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.

     (g) 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.

     (h) 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.

     (i) The Corporation will provide S&P with no less than 30 days'
notification of: (i) any material changes to the Corporation's organizational
documents and material contracts, (ii) any redemptions, or (iii) any failed
auctions.

     (j) The Corporation will provide to S&P and Moody's an audited financial
statement for its fiscal year.

     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.


                                       21




<PAGE>

     14. Waiver. To the extent permitted by Maryland Law, Holders of at least
two-thirds of the Outstanding AMPS, acting collectively, or each Series, acting
as a separate series, may waive any provision hereof intended for their
respective 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 AMPS 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.

     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:

          "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.

          "AMPS" has the meaning set forth in paragraph FIRST in the preamble of
     these Articles Supplementary.

          "Applicable Percentage" means the percentage determined based on the
     credit rating assigned to the series of AMPS on such date by Moody's (if
     Moody's is then rating the AMPS) and S&P (if S&P is then rating the AMPS)
     as follows:

<TABLE>
<CAPTION>
           Credit Ratings
     -----------------------------   Applicable
        Moody's           S&P        Percentage
     -------------   -------------   ----------
<S>                  <C>                <C>
         Aaa              AAA           125%
      Aa3 to Aa1       AA- to AA+       150%
       A3 to A1         A- to A+        200%
     Baa3 to Baa1    BBB- to BBB+       250%
</TABLE>


                                       22




<PAGE>

<TABLE>
<S>                  <C>                <C>
     Ba1 and lower   BB+ and lower      300%
</TABLE>

          For purposes of this definition, the "prevailing rating" of shares of
     a series of AMPS will be (i) AAA if such shares have a rating of AAA by
     Moody's or Fitch or the equivalent of such ratings by such agencies or
     substitute rating agencies selected as provided below; (ii) if not AAA,
     then AA- if such shares have a rating of AA- or better by Moody's or Fitch
     or the equivalent of such ratings by such agencies or substitute rating
     agencies selected as provided below, (iii) if not AA- or higher, than A- if
     such shares have a rating of A- or better by Moody's or Fitch or the
     equivalent of such ratings by such agencies or substitute rating agencies
     selected as provided below, (iv) if not A- or higher then BBB- if such
     shares have a rating of BBB- or better by Moody's or Fitch or the
     equivalent of such ratings by such agencies or substitute rating agencies
     selected as provided below, (v) if not BBB- or higher, then below BBB-;
     provided, however, that if such shares are rated by only one rating agency,
     the prevailing rating will be determined without reference to the rating of
     any other rating agency.

          The Applicable Percentage as so determined will be further subject to
     upward but not downward adjustment in the discretion of the Board of
     Directors after consultation with the Broker-Dealers, provided that that
     immediately following any such increase the Fund would be in compliance
     with the Preferred Shares Basic Maintenance Amount. The Fund will take all
     reasonable action necessary to enable either Moody's or Fitch to provide a
     rating for each series of AMPS. If neither Moody's nor Fitch will make such
     a rating available, the Fund will select another Rating Agency to act as a
     substitute Rating Agency.

          "Applicable Rate" means, with respect to each Series 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 a Series are the
     subject of Submitted Hold Orders for the Auction in respect thereof, 90% of
     the reference rate corresponding to that Series.

          "Applicable Spread" means the spread determined based on the credit
     rating assigned to the series of AMPS on such date by Moody's (if Moody's
     is then rating the AMPS) and Fitch (if Fitch is then rating the AMPS) as
     follows:
<TABLE>
<CAPTION>
            Credit Ratings
     -----------------------------   Applicable
        Moody's          Fitch         Spread
     -------------   -------------   ----------
<S>                  <C>               <C>
          Aaa             AAA          125 bps
       Aa3 to Aa1     AA- to AA+       150 bps
        A3 to A1       A- to A+        200 bps
      Baa3 to Baa1   BBB- to BBB+      250 bps
     Ba1 and lower   BB+ and lower     300 bps
</TABLE>

          For purposes of this definition, the "prevailing rating" of shares of
     a series of AMPS will be (i) AAA if such shares have a rating of AAA by
     Moody's or Fitch or the


                                       23




<PAGE>

     equivalent of such ratings by such agencies or substitute rating
     agencies selected as provided below; (ii) if not AAA, then AA- if such
     shares have a rating of AA- or better by Moody's or Fitch or the equivalent
     of such ratings by such agencies or substitute rating agencies selected as
     provided below, (iii) if not AA- or higher, than A- if such shares have a
     rating of A- or better by Moody's or Fitch or the equivalent of such
     ratings by such agencies or substitute rating agencies selected as provided
     below, (iv) if not A- or higher then BBB- if such shares have a rating of
     BBB- or better by Moody's or Fitch or the equivalent of such ratings by
     such agencies or substitute rating agencies selected as provided below, (v)
     if not BBB- or higher, then below BBB-; provided, however, that if such
     shares are rated by only one rating agency, the prevailing rating will be
     determined without reference to the rating of any other rating agency.

          The Applicable Spread as so determined will be further subject to
     upward but not downward adjustment in the discretion of the Board of
     Directors after consultation with the Broker-Dealers, provided that that
     immediately following any such increase the Fund would be in compliance
     with the Preferred Shares Basic Maintenance Amount. The Fund will take all
     reasonable action necessary to enable either Moody's or Fitch to provide a
     rating for each series of AMPS. If neither Moody's nor Fitch will make such
     a rating available, the Fund will select another Rating Agency to act as a
     substitute Rating Agency.

          "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 each 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.


                                       24




<PAGE>

          "Beneficial Owner," with respect to shares of each Series, 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 such 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.

          "Date of Original Issue" means the date on which a 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.


                                       25




<PAGE>

          "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 AMPSs), the Moody's Discount Factor (if Moody's is then rating the
     AMPS) or the discount factor established by any Other Rating Agency which
     is then rating the AMPS and which so requires, whichever is applicable.

          "Discounted Value"

          (a) for Moody's 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.

          (b) for S&P means the quotient of the Market Value of an Eligible
     Asset divided by the applicable Discount Factor.

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

          "Dividend Payment Date" with respect to the AMPS means any date on
     which dividends are payable pursuant to Section 2(b) of Part I hereof.

          "Dividend Period" means, with respect to each Series, the initial
     period determined in the manner set forth under "Designation" above, and
     thereafter, as to such Series, the period commencing on the Business Day
     following each Dividend Period for such Series and ending on the calendar
     day immediately preceding the next Dividend Payment Date for such Series.

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


                                       26




<PAGE>

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

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

          "LIBOR Dealers" means Merrill Lynch, Pierce, Fenner & Smith
     Incorporated and such other dealer or dealers as the Fund may from time to
     time appoint, or, in lieu of any thereof, their respective affiliates or
     successors.

          "LIBOR Rate," on any Auction Date, means (i) the rate for deposits in
     U.S. dollars for the designated Dividend Period, which appears on display
     page 3750 of Moneyline's Telerate Service ("Telerate Page 3750") (or such
     other page as may replace that page on that service, or such other service
     as may be selected by the LIBOR Dealer or its successors that are LIBOR
     Dealers) as of 11:00 a.m., London time, on the day that is the London
     Business Day preceding the Auction Date (the "LIBOR Determination Date"),
     or (ii) if such rate does not appear on Telerate Page 3750 or such other
     page as may replace such Telerate Page 3750, (A) the LIBOR Dealer will
     determine the arithmetic mean of the offered quotations of the Reference
     Banks to leading banks in the London interbank market for deposits in U.S.
     dollars for the designated Dividend Period in an amount determined by such
     LIBOR Dealer by reference to requests for quotations as of approximately
     11:00 a.m. (London time) on such date made by such LIBOR Dealer to the
     Reference Banks, (B) if at least two of the Reference Banks provide such
     quotations, LIBOR Rate will equal such arithmetic mean of such quotations,
     (C) if only one or none of the Reference Banks provide such quotations,
     LIBOR Rate will be deemed to be the arithmetic mean of the offered
     quotations that leading banks in The City of New York selected by the LIBOR
     Dealer (after obtaining the Fund's approval) are quoting on the relevant
     LIBOR Determination Date for deposits in U.S. dollars for the designated
     Dividend Period in an amount determined by the LIBOR Dealer (after
     obtaining the Fund's approval) that is representative of a single
     transaction in such market at such time by reference to the principal
     London offices of leading banks in the London interbank market; provided,
     however, that if one of the LIBOR Dealers does not quote a rate required to
     determine the LIBOR Rate, the LIBOR Rate will be determined on the basis of
     the quotation or quotations furnished by any Substitute LIBOR Dealer or
     Substitute LIBOR Dealers selected by the Fund to provide such rate or rates
     not being supplied by the LIBOR Dealer; provided further, that if the LIBOR
     Dealer and Substitute LIBOR Dealers are required but unable to determine a
     rate in accordance with at least one of the procedures provided above,
     LIBOR Rate will be LIBOR Rate as determined on the previous Auction Date.
     If the number of Dividend Period days will be (i) 7 or more but fewer than
     21 days, such rate will be the seven-day LIBOR rate; (ii) more than 21 but
     fewer than 49 days, such rate will be the one-month LIBOR rate; (iii) 49 or
     more but fewer than 77 days, such rate will be the two-month LIBOR rate;
     (iv) 77 or more but fewer than 112 days, such rate will be the three-month
     LIBOR rate; (v) 112 or more but fewer than 140 days, such rate will be the
     four-month LIBOR rate; (vi) 140 or more but fewer than 168 days, such rate
     will be the five-month LIBOR rate; (vii) 168 or more but fewer than 189
     days, such rate will be the six-month LIBOR rate; (viii) 189 or more but
     fewer than 217 days, such rate will be the seven-month LIBOR rate; (ix) 217
     or more but fewer than 252 days, such rate will be the eight-month LIBOR
     rate; (x) 252 or more but


                                       27




<PAGE>

     fewer than 287 days, such rate will be the nine-month LIBOR rate; (xi)
     287 or more but fewer than 315 days, such rate will be the ten-month LIBOR
     rate; (xii) 315 or more but fewer than 343 days, such rate will be the
     eleven-month LIBOR rate; and (xiii) 343 or more but fewer than 365 days,
     such rate will be the twelve-month LIBOR rate.

          "Liquidation Preference" means $25,000 per share of AMPS.

          "London Business Day" means any day on which commercial banks are
     generally open for business in London.

          "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
     day, the securities are valued at the closing bid prices on such day and
     provided further that, if no bid 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.


                                       28




<PAGE>

          "Maximum Rate," for shares of a series of AMPS on any Auction Date for
     shares of such series, will mean for any Rate Period, the greater of the
     Applicable Percentage of the Reference Rate or the Applicable Spread plus
     the Reference Rate. The Auction Agent will round each applicable Maximum
     Rate to the nearest one-thousandth (0.001) of one percent per annum, with
     any such number ending in five ten-thousandths of one percent being rounded
     upwards to the nearest one-thousandth (0.001) of one percent.

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

<TABLE>
<CAPTION>
                                                                            Discount
                                                                         Factor(1)(2)(3)
                                                                         ---------------
<S>                                                                           <C>
Common stock of REITs and other real estate companies                         154%
Preferred stock of REITs
   with Senior Implied Moody's (or S&P or Fitch) rating:                      154%
   without Senior Implied Moody's (or S&P or Fitch) rating:                   208%
Preferred stock of Other Real Estate Companies
   with Senior Implied Moody's (or S&P or Fitch) rating:                      208%
   without Senior Implied Moody's (or S&P or Fitch) rating:                   250%
Preferred Securities of non-real estate companies (4)(5):
The Moody's Discount Factor for non-real estate preferred securities
   will be
      (A) for preferred securities issued by a utility,                       152%
      (B) for preferred securities of industrial and financial issuers
         and other issuers,                                                   197%
      (C) for auction rate preferred securities,                              350%
</TABLE>

----------
(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 a real estate issuer is
     below $500 million.
(4)  Applies to preferred securities which have a minimum issue size of $50
     million.
(5)  Non-real estate eligible preferred securities will be issued by investment
     grade companies having a senior unsecured debt rating that is Baa3 or
     higher by Moody's or BBB- by S&P or Fitch and pay dividends in U.S. Dollars
     or Euros. The market value of eligible non-cumulative preferred issues are
     subject to standard preferred stock discount factors multiplied by a factor
     of 1.10.


                                       29




<PAGE>

          (b) Debt Securities (1)(2)(3):

          The percentage determined by reference to the rating on such asset
     with reference to the remaining term to maturity of such asset, in
     accordance with the table set forth below.

<TABLE>
<CAPTION>
     Term to Maturity of Debt Security        Aaa    Aa    A    Baa    Ba    B    Unrated(3)
-------------------------------------------   ---   ---   ---   ---   ---   ---   ----------
<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%  153%  153%  168%    250%
4 years or less (but longer than 3 years)     126%  129%  133%  161%  161%  176%    250%
5 years or less (but longer than 4 years)     132%  135%  139%  168%  168%  185%    250%
7 years or less (but longer than 5 years)     139%  143%  147%  179%  179%  197%    250%
10 years or less (but longer than 7 years)    145%  150%  155%  189%  189%  208%    250%
15 years or less (but longer than 10 years)   150%  155%  160%  196%  196%  216%    250%
20 years or less (but longer than 15 years)   150%  155%  160%  196%  196%  228%    250%
30 years or less (but longer than 20 years)   150%  155%  160%  196%  196%  229%    250%
Greater than 30 years                         165%  173%  181%  189%  205%  240%    250%
</TABLE>

----------
(1)  The Moody's 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)  Corporate debt securities if (A) such securities provide for the periodic
     payment of interest in cash in U.S. dollars or euros, except that such
     securities that do not pay interest in U.S. dollars or euros will be
     considered Moody's Eligible Assets if they are rated by Moody's or S&P or
     Fitch; (B) for debt securities rated B and below taken together with
     "Unrated" securities, no more than 10% of the original amount of such issue
     may constitute Moody's Eligible Assets; (C) such securities have been
     registered under the Securities Act or are restricted as to resale under
     federal securities laws but are eligible for resale pursuant to Rule 144A
     under the Securities Act as determined by the Fund's investment manager or
     portfolio manager acting pursuant to procedures approved by the Board of
     Directors, except that such securities that are not subject to U.S. federal
     securities laws will be considered Moody's Eligible Assets if they are
     publicly traded; and (D) such securities are not subject to extended
     settlement.
(3)  Unless conclusions regarding liquidity risk as well as estimates of both
     the probability and severity of default for the Corporation'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 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 this table. 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.

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

<TABLE>
<CAPTION>
                                              U.S. Treasury Securities
Remaining Term to Maturity                         Discount Factor       U.S. Treasury Strips
--------------------------                    ------------------------   --------------------
<S>                                                     <C>                      <C>
1 year or less                                          107%                     107%
2 years or less (but longer than 1 year)                113%                     114%
3 years or less (but longer than 2 years)               118%                     120%
4 years or less (but longer than 3 years)               123%                     127%
5 years or less (but longer than 4 years)               128%                     133%
</TABLE>


                                       30




<PAGE>

<TABLE>
<S>                                                     <C>                      <C>
7 years or less (but longer than 5 years)               135%                     145%
10 years or less (but longer than 7 years)              141%                     159%
15 years or less (but longer than 10 years)             146%                     184%
20 years or less (but longer than 15 years)             154%                     211%
30 years or less (but longer than 20 years)             154%                     236%
</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 by S&P 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.

          (e) Rule 144A Debt or Preferred Securities:

          The Moody's Discount Factor applied to Rule 144A debt or preferred
     securities will be 130% of the Moody's Discount Factor which would apply
     were the securities registered under the Securities Act.

          (f) Convertible Securities:

                           MOODY'S RATING CATEGORY(1)
<TABLE>
<CAPTION>
Industry Category   Aaa    Aa    A    Baa    Ba    B     NR
-----------------   ---   ---   ---   ---   ---   ---   ---
<S>                 <C>   <C>   <C>   <C>   <C>   <C>   <C>
Utility             162%  167%  172%  188%  195%  199%  300%
Industrial          256%  261%  266%  282%  290%  293%  300%
Financial           233%  238%  243%  259%  265%  270%  300%
Transportation      332%  337%  342%  358%  365%  369%  370%
</TABLE>

----------
(1)  Unless conclusions regarding liquidity risk as well as estimates of both
     the probability and severity of default for the Corporation'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 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 this table. 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.

          "Moody's Eligible Assets" means the following:

          (i) Common Stock, Preferred Stock and any debt security of REITs and
     Other Real Estate Companies, and Preferred Stock and debt securities of non
     real estate companies:


                                       31




<PAGE>

               (A) which comprise at least 7 of the total number of Moody's Real
          Estate Industry/Property Sector Classifications ("Moody's Sector
          Classifications") and Moody's Industry Classifications, 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 6.0% 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;

          (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 taken together with securities rated Ba1 by
          Moody's, or comparable by S&P or Fitch, and below do not exceed 10% of
          the discounted Moody's Eligible Assets;

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

               (A) 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;

               (B) 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;

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

               (D) 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


                                       32




<PAGE>

               (E) 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.

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

          (v) 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.

          (vi) 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
          (1) settled through clearing house firms with respect to which the
          Corporation has received prior written authorization from Moody's or
          (2) with counterparties having a Moody's long-term debt rating of at
          least Baa3 or (3) with counterparties having a Moody's Short-Term
          Money Market Instrument rating of at least P-1.

          The foregoing Rating Agency Guidelines are subject to change from time
     to time. The Fund may, but is not required to, adopt any such change.
     Nationally recognized rating agencies other than S&P and Moody's may also
     from time to time rate the AMPS; any nationally recognized rating agency
     providing a rating for the AMPS may, at any time change or withdraw any
     such rating.

          "Moody's Industry Classifications" means, for the purposes of
     determining Moody's Eligible Assets, each of the following Industry
     Classifications:

          1.  Aerospace & Defense
          2.  Automobile


                                       33




<PAGE>

          3.  Banking
          4.  Beverage, Food & Tobacco
          5.  Buildings & Real Estate
          6.  Chemicals, Plastics & Rubber
          7.  Containers, Packaging & Glass
          8.  Personal & Nondurable Consumer Projects (Manufacturing Only)
          9.  Diversified/Conglomerate Manufacturing
          10. Diversified/Conglomerate Service
          11. Diversified Natural Resources, Precious Metals & Minerals
          12. Ecological
          13. Electronics
          14. Finance
          15. Farming & Agriculture
          16. Grocery
          17. Healthcare, Education & Childcare
          18. Home & Office Furnishings, Housewares & Durable Consumer Products
          19. Hotels, Motels, Inns and Gaming
          20. Insurance
          21. Leisure, Amusement, Entertainment
          22. Machinery (Nonagriculture, Nonconstruction, Nonelectronic)
          23. Mining, Steel, Iron & Nonprecious Metals
          24. Oil & Gas
          25. Personal, Food & Misc. Services
          26. Printing & Publishing
          27. Cargo Transport
          28. Retail Stores
          29. Telecommunications
          30. Textiles & Leather
          31. Personal Transportation
          32. Utilities
          33. Broadcasting & Entertainment

          "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"):

          (i)    Office
          (ii)   Industrial
          (iii)  Mixed
          (iv)   Shopping Centers
          (v)    Regional Malls
          (vi)   Free Standing
          (vii)  Apartments
          (viii) Manufactured Homes
          (ix)   Diversified
          (x)    Lodging/Resorts


                                       34




<PAGE>

          (xi)   Health Care
          (xii)  Home Financing
          (xiii) Commercial Financing
          (xiv)  Self Storage
          (xv)   Specialty

          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 AMPS (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(f) of these Articles Supplementary.

          "Notice of Redemption" means any notice with respect to the redemption
     of AMPS 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 AMPS 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 AMPS.

          "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.

          "Outstanding" means, as of any date, AMPS theretofore issued by the
     Corporation except, without duplication, (i) any AMPS theretofore canceled,
     redeemed or repurchased by the Corporation, or delivered to the Auction
     Agent for cancellation or


                                       35




<PAGE>

     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 AMPS 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 AMPS 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 AMPS 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, AMPS 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 "Person" 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 sum of:

               (i)(A) the product of the number of AMPS outstanding on such date
          multiplied by $25,000 (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 AMPS (or other preferred shares) then
          subject to redemption; (B) the aggregate amount of dividends that will
          have accumulated at the respective Applicable Rates (whether or not
          earned or declared) to (but not including) the first respective
          Dividend Payment Date for the AMPS outstanding that follows such
          Valuation Date (plus the aggregate amount of dividends, whether or not
          earned or declared, that will have accumulated in respect of other
          outstanding preferred shares to, but not including, the first
          respective dividend payment date for such other shares that follows
          such Valuation Date); (C) the aggregate amount of dividends that would
          accumulate on shares of each series of the AMPS outstanding from such
          first respective Dividend Payment Date therefor through the 56th day
          after such Valuation Date, at the Maximum Rate; (D) the amount of
          anticipated expenses of the Corporation for the 90 days subsequent to
          such Valuation Date; (E) the amount of any indebtedness or obligations
          of the Corporation senior in right of


                                       36




<PAGE>

          payment to the AMPS; and (F) any current liabilities as of such
          Valuation Date, to the extent not reflected in any of (i)(A) through
          (i)(F) less

               (ii) the value (i.e., for purposes of current Moody's guidelines,
          the face value of cash and short-term securities that are the direct
          obligation of the U.S. government, provided in each case that such
          securities mature on or prior to the date upon which any of (i) (A)
          through (i) (F) become payable, otherwise the Moody's Discounted
          Value) (i.e., for the purposes of the current S&P guidelines, the face
          value of cash, and short term securities that are the direct
          obligations of the U.S. government, provided in each case that such
          securities mature on or prior to the date upon which any of (i)(A)
          through (i)(F) becomes payable, otherwise the S&P Discounted Value) of
          any of the Corporation's assets irrevocably deposited by the
          Corporation for the payment of any of (i)(A) through (i)(F).

          "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. The Corporation will notify Moody's if coverage
     declines below 1.30X 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 Global Pricing
          Chanin Capital Partners
          Data Resources Inc. (a McGraw-Hill company)
          FT Interactive Data
          J.J. Kenny Drake
          JP Morgan Pricing Services
          Loan Pricing Corporation (owned by Reuters)
          Meenan, Mcdevitt & Co., Inc
          Reuters
          Securities Evaluation Services
          Standard & Poor's Evaluation Services
          Thomson Financial Securities Management
          Telerate
          Telekurs
          Trepp Pricing Service
          Van Kampen Merritt Investment Advisory Corp Pricing Service
          CIBC World Markets

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


                                       37




<PAGE>

          "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 Banks" means four major banks in the London interbank
     market selected by Merrill Lynch, Pierce, Fenner & Smith Incorporated or
     its affiliates or successors or such other party as the Fund may from time
     to time appoint.

          "Reference Rate" means, with respect to the determination of the
     Default Rate, the applicable LIBOR Rate (for a Dividend Period of fewer
     than 365 days) or the applicable Treasury Index Rate (for a Dividend Period
     of 365 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, with respect to an S&P Eligible Asset
     specified below, the following applicable number is the S&P Discount Factor
     provided that the S&P Exposure Period is 25 Business Days or less:

          (a) Types of S&P Eligible Assets

<TABLE>
<CAPTION>
                                                              Discount Factor for
Type of S&P Eligible Asset                                         AAA Rating
-------------------------                                     -------------------
<S>                                                                   <C>
Common Stock of REITs and other real estate companies                 162%
DRD Eligible Preferred Stock with a senior or preferred
   stock rating of at least BBB-                                      245%
REIT and Non-DRD eligible Preferred Stock with a senior or
   preferred stock rating of at least BBB-                            164%
DRD Eligible Preferred Stock with a senior or preferred
   stock rating below BBB-                                            250%
REIT and non-DRD Eligible Preferred Stock with a senior or
   preferred stock rating below BBB-                                  169%
Un-rated DRD Eligible Preferred Stock                                 255%
Un-rated Non-DRD Eligible and un-rated REIT Preferred Stock           174%
Convertible bonds rated AAA to AAA-                                   165%
Convertible bonds rated AA+ to AA-                                    170%
Convertible bonds rated A+ to A-                                      175%
Convertible bonds rated BBB+ to BBB-                                  180%
</TABLE>


                                       38




<PAGE>

<TABLE>
<CAPTION>
                                                              Discount Factor for
Type of S&P Eligible Asset                                         AAA Rating
-------------------------                                     -------------------
<S>                                                                   <C>
Convertible bonds rated BB+ to BB-                                    185%
Convertible bonds rated B+ to B                                       190%
Convertible bonds rated B-                                            195%
Convertible bonds rated CCC+                                          205%
Convertible bonds rated CCC                                           220%
U.S. Short-Term Money Market Investments with maturities of
   180 days or less                                                   104%
U.S. Short-Term Money Market Investments with maturities of
   between 181 and 360 days                                           113%
U.S. Government Obligations (52 week Treasury Bills)                  102%
U.S. Government Obligations (Two-Year Treasury Notes)                 104%
U.S. Government Obligations (Five-Year Treasury Notes)                110%
U.S. Government Obligations (Ten-Year Treasury Notes)                 117%
U.S. Government Obligations (Thirty-Year Treasury Bonds)              130%
Agency Mortgage Collateral (Fixed 15-Year)                            129%
Agency Mortgage Collateral (Fixed 30-Year)                            132%
Agency Mortgage Collateral (ARM 1/1)                                  122%
Agency Mortgage Collateral (ARM 3/1)                                  123%
Agency Mortgage Collateral (ARM 5/1)                                  123%
Agency Mortgage Collateral (ARM 10/1)                                 123%
Mortgage Pass-Through Fixed (15 Year)                                 131%
Mortgage Pass-Through Fixed (30 Year)                                 134%
   Debt securities of REIT's and other real estate
      companies according to the following corporate bond
      schedule
   Corporate Bonds rated at least AAA                                 110%
   Corporate Bonds rated at least AA+                                 111%
   Corporate Bonds rated at least AA                                  113%
   Corporate Bonds rated at least AA-                                 115%
   Corporate Bonds rated at least A+                                  116%
   Corporate Bonds rated at least A                                   117%
   Corporate Bonds rated at least A-                                  118%
   Corporate Bonds rated at least BBB+                                120%
   Corporate Bonds rated at least BBB                                 122%
   Corporate Bonds rated at least BBB-                                124%
   Corporate Bonds rated at least BB+                                 129%
   Corporate Bonds rated at least BB                                  135%
   Corporate Bonds rated at least BB-                                 142%
   Corporate Bonds rated at least B+                                  156%
   Corporate Bonds rated at least B                                   169%
   Corporate Bonds rated at least B-                                  184%
   Corporate Bonds rated at least CCC+                                202%
   Corporate Bonds rated at least CCC                                 252%
   Corporate Bonds rated at least CCC-                                350%
Cash and Cash Equivalents                                             100%
</TABLE>

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


                                       39




<PAGE>

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

               (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.

               (iii) The interest rate swap transaction will be marked-to-market
          weekly by the swap counterparty.

               (iv) If the Corporation fails to maintain an aggregate discounted
          value at least equal to the basic maintenance amount on two
          consecutive valuation dates then the agreement will terminate
          immediately.

               (v) For the purpose of calculating the asset coverage test 90% of
          any positive mark-to-market valuation of the Corporation's rights will
          be eligible assets. 100% of any negative mark-to-market valuation of
          the Corporation's rights will be included in the calculation of the
          Preferred Shares Basic Maintenance Amount.

               (vi) The Corporation must maintain liquid assets with a value at
          least equal to the net amount of the excess, if any, of the
          Corporation's obligations over its entitlement with respect to each
          swap. For caps/floors, must maintain liquid assets with a value at
          least equal to the Corporation's obligations with respect to such caps
          or floors.

          (c) Cash and Cash Equivalents

               (i) Cash and Cash Equivalents and demand deposits in an "A-1+"
          rated institution are valued at 100%. "A-1+" rated commercial paper,
          with maturities no greater than 30 days and held instead of cash until
          maturity, is valued at 100%. Securities with next-day maturities
          invested in "A-1+" rated institutions re considered cash equivalents
          and are valued at 100%. Securities maturing in 181 to 360 calendar
          days are valued at 114.2%.

               (ii) The S&P Discount Factor for shares of unrated Money Market
          Funds affiliated with the Corporation used as "sweep" vehicles will be
          111%. Money Market Funds rated "AAAm" will be discounted at the
          appropriate level as dictated by the exposure period. No S&P Discount
          Factor will be applied to Money Market Funds rated AAAm by S&P with
          effective next day maturities.

          "S&P Eligible Assets" will mean:

               (A) Deposit Securities;

               (B) U.S. Government Obligations and U.S. Government Agencies;


                                       40




<PAGE>

               (C) Corporate Indebtedness. Evidences of indebtedness other than
          Deposit Securities, U.S. Government Obligations and Municipal
          Obligations that are not convertible into or exchangeable or
          exercisable for stock of a corporation (except to the extent of ten
          percent (10%) in the case of a share exchange or tender offer) ("Other
          Debt") and that satisfy all of the following conditions:

                    (1) be no more than 10% of total assets may be below a S&P
               rating of BBB-, or comparable Moody's or Fitch rating, or
               unrated;

                    (2) the remaining term to maturity of such Other Debt will
               not exceed fifty (50) years;

                    (3) such Other Debt must provide for periodic interest
               payments in cash over the life of the security;

                    (4) no more than 10% of the issuers of such evidences of
               indebtedness do not file periodic financial statements with the
               U.S. Securities and Exchange Commission;

                    (5) which, in the aggregate, have an average duration of not
               more than 12 years.

               (D) Convertible Corporate Indebtedness. Evidences of indebtedness
          other than Deposit Securities, U.S. Government Obligations and
          Municipal Obligations that are convertible into or exchangeable or
          exercisable for stock of a corporation and that satisfy all of the
          following conditions:

                    (1) such evidence of indebtedness is rated at least CCC by
               S&P; and

                    (2) if such evidence of indebtedness is rated BBB or lower
               by S&P, the market capitalization of the issuer of such evidence
               of indebtedness is at least $100 million;

               (E) Agency Mortgage Collateral. Certificates guaranteed by U.S.
          Government Agencies (as defined below) (e.g., FNMA, GNMA and FHLMC)
          for timely payment of interest and full and ultimate payment of
          principal. Agency Mortgage Collateral also evidence undivided
          interests in pools of level-payment, fixed, variable, or adjustable
          rate, fully amortizing loans that are secured by first liens on one-
          to four-family residences residential properties (or in the case of
          Plan B FHLMC certificates, five or more units primarily designed for
          residential use) ("Agency Mortgage Collateral"). Agency Mortgage
          Collateral the following conditions apply:

                    (1) For GNMA certificates backed by pools of graduated
               payment mortgages, levels are 20 points above established levels;


                                       41




<PAGE>

                    (2) Qualifying "large pool" FNMA mortgage-backed securities
               and FHLMC participation certificates are acceptable as eligible
               collateral. The eligible fixed-rate programs include FNMA
               MegaPools, FNMA Majors, FHLMC Multilender Swaps, and FHLMC Giant
               certificates. Eligible adjustable rate mortgage ("ARMs") programs
               include nonconvertible FNMA ARM MegaPools and FHLMC weighted
               average coupon ARM certificates. Eligible FHLMC Giant programs
               exclude interest-only and principal only stripped securities;

                    (3) FNMA certificates backed by multifamily ARMs pegged to
               the 11th District Cost of Funds Index are acceptable as eligible
               collateral at 5 points above established levels; and

                    (4) Multiclass REMICs issued by FNMA and FHLMC are
               acceptable as eligible collateral at the collateral levels
               established for CMOs.

               (F) Mortgage Pass-Through Certificates. Publicly issued
          instruments maintaining at least a AA- ratings by S&P. Certificates
          evidence proportional, undivided interests in pools of whole
          residential mortgage loans. Pass-through certificates backed by pools
          of convertible ARMs are acceptable as eligible collateral at 5 points
          above the levels established for pass-through certificates backed by
          fixed or non-convertible ARM pools.

               (G) Preferred Stocks. Preferred stocks that satisfy all of the
          following conditions:

                    1. The preferred stock issue has a senior rating from S&P,
               or the preferred issue must be rated. In the case of Yankee
               preferred stock, the issuer should have a S&P senior rating of at
               least "BBB-", or the preferred issue must be rated at least
               "BBB-".

                    2. The issuer--or if the issuer is a special purpose
               corporation, its parent--is listed on either the New York Stock
               Exchange, the American Stock Exchange or NASDAQ if the traded par
               amount is less than $1,000. If the traded par amount is $1,000 or
               more exchange listing is not required.

                    3. The collateral pays cash dividends denominated in U.S.
               dollars.

                    4. Private placement 144A with registration rights are
               eligible assets.

                    5. The minimum market capitalization of eligible issuers is
               US$100 million.

                    Restrictions for floating-rate preferred stock:


                                       42




<PAGE>

                         1. Holdings must be limited to stock with a dividend
                    period of less than or equal to 49 days, except for a new
                    issue, where the first dividend period may be up to 64 days.

                         2. The floating-rate preferred stock may not have been
                    subject to a failed auction.

                    Restrictions for adjustable--or auction-rate preferred
               stock:

                         1. The total fair market value of adjustable-rate
                    preferred stock held in the portfolio may not exceed 10% of
                    eligible assets.

                    Concentration Limits:

                         2. Total issuer exposure in preferred stock of any one
                    issuer is limited to 10% of the fair market value of
                    eligible assets.

                         3. Preferred stock rated below B- (including non-rated
                    preferred stock) and preferred stock with a market cap of
                    less than US$100 million are limited to no more than 15% of
                    the fair market value of the eligible assets.

                         4. Add 5 points to over-collateralization level for
                    issuers with a senior rating or preferred stock rating of
                    less than BBB-.

                         5. Add 10 point to over-collateralization level of
                    issuers with no senior rating, preferred stock rating or
                    dividend history.

               (H) Common Stocks of REITs and Other Real Estate Companies.
          Common stocks of REITs and Other Real Estate Companies that satisfy
          all of the following conditions:

                    (1) such common stock (including the common stock of any
               predecessor or constituent issuer) has been traded on a
               recognized national securities exchange or quoted on the National
               Market System (or any equivalent or successor thereto) of NASDAQ,
               but excluding "144a" or "pink sheet" stock not carried in daily
               newspaper over-the-counter listings;

                    (2) the market capitalization of such issuer of common stock
               exceeds $100 million;

                    (3) the issuer of such common stock is not an entity that is
               treated as a partnership for federal income taxes;

                    (4) if such issuer is organized under the laws of any
               jurisdiction other than the United States, any state thereof, any
               possession or territory thereof or the District of Columbia, the
               common stock of such issuer held


                                       43




<PAGE>

               by the Corporation is traded on a recognized national securities
               exchange or quoted on the National Market System of NASDAQ either
               directly or in the form of depository receipts.

          Escrow Bonds may comprise 100% of the Corporation's S&P Eligible
     Assets. Bonds that are legally defeased and secured by direct U.S.
     government obligations are not required to meet any minimum issuance size
     requirement. Bonds that are economically defeased or secured by other U.S.
     agency paper must meet the minimum issuance size requirement for the Trust
     described above. Bonds initially rated or rerated as an escrow bond by
     another Rating Agency are limited to 50% of the Corporation's S&P Eligible
     Assets, and carry one full rating lower than the equivalent S&P rating for
     purposes of determining the applicable discount factors. Bonds economically
     defeased and either initially rated or rerated by S&P or another Rating
     Agency are assigned that same rating level as its debt issuer, and will
     remain in its original industry category unless it can be demonstrated that
     a legal defeasance has occurred.

          With respect to the above, the Corporation portfolio must consist of
     no less than 20 issues representing no less than 10 industries as
     determined by the S&P Industry Classifications and S&P Real Estate
     Industry/Property sectors.

          For purposes of determining the discount factors applicable to
     collateral not rated by S&P, the collateral will carry an S&P rating one
     full rating level lower than the equivalent S&P rating.

          "S&P Exposure Period" will mean the sum of (i) that number of days
     from the last Valuation Date on which the Corporation's Discounted Value of
     S&P Eligible Assets were greater than the Preferred Shares Basic
     Maintenance Amount to the Valuation Date on which the Corporation's
     Discounted Value of S&P Eligible Assets failed to exceed the Preferred
     Shares Basic Maintenance Amount, (ii) the maximum number of days following
     a Valuation Date that the Corporation has under this Statement to cure any
     failure to maintain a Discounted Value of S&P Eligible Assets at least
     equal to the Preferred Shares Basic Maintenance Amount, and (iii) the
     maximum number of days the Corporation has to effect a mandatory redemption
     under Section 3(a)(ii) of Part I of these Articles Supplementary.

          "S&P Industry Classifications" will mean, for the purposes of
     determining S&P Eligible Assets, each of the following industry
     classifications (as defined by the S&P global industry classification):

          Aerospace & Defense
          Air Freight and Logistics Airlines
          Automobiles
          Automobile Components
          Beverages
          Biotechnology
          Building Products
          Cable


                                       44




<PAGE>

          Capital Markets
          Computers & Peripherals
          Commercial Banks
          Commercial Services & Supplies
          Communications Equipment
          Construction & Engineering
          Consumer Finance
          Containing & Packaging
          Distributors
          Diversified Financial Services
          Diversified Telecommunication Services
          Electric Utilities
          Electrical Equipment
          Electronic Equipment & Instrument
          Energy Equipment & Services
          Food & Staples Retailing
          Food Products
          Gas Utilities
          Healthcare Equipment & Supplies
          Healthcare Providers & Services
          Hotels, Restaurants & Leisure
          Household Durables
          Household Products
          Industrial Conglomerates
          Insurance
          Internet & Catalog Retail
          Internet Software & Services
          IT Services
          Leisure Equipment & Products
          Machinery
          Marine
          Media
          Metals & Mining
          Office Electronics
          Oil & Gas
          Packaging and Containers
          Paper & Forest Products
          Personal Products
          Pharmaceuticals
          Real Estate
          Retail
          Road & Rail
          Software
          Specialty Retail
          Semiconducters and Semi Conducter Equipment
          Textiles, Apparel and Luxury Goods


                                       45




<PAGE>

          Thrift & Mortgage Finance
          Tobacco
          Trading Companies & Distributors
          Transportation and Infrastructure
          Transportation Utilities
          Water Utilities
          Wireless Telecommunication Services

          "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
          15. Specialty

          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.

          The foregoing Rating Agency Guidelines are subject to change from time
     to time. The Fund may, but is not required to, adopt any such change.
     Nationally recognized rating agencies other than S&P and Moody's may also
     from time to time rate the AMPS; any nationally recognized rating agency
     providing a rating for the AMPS may, at any time change or withdraw any
     such rating.

          "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 AMPS.

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


                                       46




<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;

               (iv) U.S. Government Securities; and

               (v) Rule 2a-7 eligible money market funds.

          "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 seven days in
     the case of Series M7, Series T7, Series W7, Series TH7 and Series F7 AMPS
     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 for the applicable Series),
     or 28 days in the case of the Series W28A, Series W28B and Series W28C
     AMPS, unless the day after such 28th day is not a Business Day, then the
     number of days ending on the calendar day next preceding the next Business
     Day.


                                       47




<PAGE>

          "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 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:


                                       48




<PAGE>

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 or potential holders of
     AMPS.

          "Available AMPS" 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 AMPS
     listed in that person's name in the records of the Auction Agent or (b) the
     beneficial owner of those AMPS 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 AMPS 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 AMPS or (b) any other person who may be
     interested in acquiring AMPS 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.

          "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 AMPS are the subject of
     Submitted Hold Orders or that the number of AMPS that are the subject of
     Submitted Buy Orders by Potential Holders specifying one or more rates
     equal to or less than the Maximum Rate


                                       49




<PAGE>

     exceeds or equals the sum of (A) the number of AMPS 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 AMPS 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 AMPS which, when
     added to the number of AMPS to be purchased by the Potential Holders
     described in clause (B) above and the number of AMPS subject to Submitted
     Hold Orders, would be equal to the number of AMPS.

     2. Orders.

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

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

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

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

               (C) the number of Outstanding shares, if any, of such series held
          by such Beneficial Owner which such Beneficial Owner offers to sell
          without regard to the Applicable Rate for shares of such series for
          the next succeeding Dividend Period of shares of such series; 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 such series
     which each such Potential Beneficial Owner offers to purchase if the
     Applicable Rate for shares of such series for the next succeeding Dividend
     Period of shares of such series will not be less than the rate per annum
     specified by such Potential Beneficial Owner.


                                       50




<PAGE>

     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 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 a
series of AMPS subject to an Auction on any Auction Date will constitute an
irrevocable offer to sell:

               (A) the number of Outstanding shares of such series specified in
          such Bid if the Applicable Rate for shares of such 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 such
          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 shares of such
          series determined on such Auction Date will be equal to the rate
          specified therein; or

               (C) the number of Outstanding shares of such series specified in
          such Bid if the rate specified therein will be higher than the Maximum
          Rate for shares of such series, or such number or a lesser number of
          Outstanding shares of such 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 shares of
          such series and Sufficient Clearing Bids for shares of such series do
          not exist.

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

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

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

     provided, however, that a Broker-Dealer that is an Existing Holder with
     respect to shares of a series of AMPS 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


                                       51




<PAGE>

     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 a series of AMPS
     subject to an Auction on any Auction Date will constitute an irrevocable
     offer to purchase:

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

     (c) No Order for any number of AMPS 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 AMPS of a 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 such series that are the
     subject of such Order;

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

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

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

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

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


                                       52




<PAGE>

     (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 AMPS of a 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 such 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 such 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 such 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 AMPS of a
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 shares of such series will be considered
     valid, but only up to and including in the aggregate the number of
     Outstanding shares of such series held by such Existing Holder, and if the
     number of shares of such series subject to such Hold Orders exceeds the
     number of Outstanding shares of such 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 such series held by such
     Existing Holder;

          (ii) (A) any Bid for shares of such series will be considered valid up
     to and including the excess of the number of Outstanding shares of such
     series held by such Existing Holder over the number of shares of such
     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 such series is submitted to the Auction Agent
          with the same rate and the number of Outstanding shares of such 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 such series subject to each Bid with the same
          rate will be reduced pro rata to cover the number of shares of such
          series equal to such excess;

               (C) subject to subclauses (A) and (B), if more than one Bid of an
          Existing Holder for shares of such 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


                                       53




<PAGE>

               (D) in any such event, the number, if any, of such Outstanding
          shares of such 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 such series by or on behalf of a
          Potential Holder at the rate therein specified; and

          (iii) all Sell Orders for shares of such series will be considered
     valid up to and including the excess of the number of Outstanding shares of
     such series held by such Existing Holder over the sum of shares of such
     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 a series of AMPS 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 a series of AMPS, the Auction Agent will assemble all valid Orders
submitted or deemed submitted to it by the Broker-Dealers in respect of shares
of such 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 such series:

          (i) the excess of the number of Outstanding shares of such series over
     the number of Outstanding shares of such series subject to Submitted Hold
     Orders (such excess being hereinafter referred to as the "Available AMPS"
     of such series);

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

               (A) the number of Outstanding shares of such 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 such series; exceeds or is equal to the sum of

               (B) the number of Outstanding shares of such 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 such
          series; and

               (C) the number of Outstanding shares of such series subject to
          Submitted Sell Orders (in the event such excess or such equality
          exists (other than because the number of shares of such series in
          subclauses (B) and (C) above is zero because all of the Outstanding
          shares of such series are subject to Submitted Hold


                                       54




<PAGE>

          Orders), such Submitted Bids in subclause (A) above being hereinafter
          referred to collectively as "Sufficient Clearing Bids" for shares of
          such series); and

          (iii) if Sufficient Clearing Bids for shares of such series exist, the
     lowest rate specified in such Submitted Bids (the "Winning Bid Rate" for
     shares of such 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 such 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 such series which, when
          added to the number of Outstanding shares of such series to be
          purchased by such Potential Holders described in subclause (B) above,
          would equal not less than the Available AMPS of such 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 of AMPS for which an
Auction is being held on the Auction Date and, based on such determination, the
Applicable Rate for shares of such series for the next succeeding Dividend
Period thereof as follows:

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

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

          (iii) if all of the Outstanding shares of such series are subject to
     Submitted Hold Orders, that the Applicable Rate for all shares of such
     series for the next succeeding Dividend Period thereof will be 90% of the
     reference rate.

     5. Acceptance and Rejection of Submitted Bids and Submitted Sell Orders and
Allocation. Existing Holders will continue to hold the AMPS 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 a series of AMPS have been
made, all Submitted Sell Orders with respect to shares of such 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


                                       55




<PAGE>

such series will be accepted or rejected as follows in the following order of
priority and all other Submitted Bids with respect to shares of such series will
be rejected:

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

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

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

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

          (v) each Potential Holder's Submitted Bid for shares of such series
     specifying a rate that is equal to the Winning Bid Rate for shares of such
     series will be accepted but only in an amount equal to the number of shares
     of such series obtained by multiplying the number of shares in the excess
     of the Available AMPS of such series over the number of AMPS 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
     AMPS subject to such Submitted Bid and the denominator of which will be the
     aggregate number of Outstanding AMPS subject to such Submitted Bids made by
     all such Potential Holders that specified a rate equal to the Winning Bid
     Rate for shares of such series.

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


                                       56




<PAGE>

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

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

          (iii) Each Existing Holder's Submitted Bid for shares of such series
     specifying any rate that is higher than the Maximum Rate for shares of such
     series and the Submitted Sell Orders for shares of such 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 such 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 such series obtained by multiplying the
     number of shares of such 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 such 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 such series subject to all such Submitted Bids and Submitted Sell
     Orders.

     (c) If all of the Outstanding shares of a series of AMPS are subject to
Submitted Hold Orders, all Submitted Bids for shares of such 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 a series of AMPS 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 AMPS of such 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 a series of AMPS.

     (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 a series of AMPS on any Auction Date, the
Auction Agent will, in such manner as it will determine in its sole discretion,
allocate AMPS of such series for purchase among Potential Holders so that only
whole AMPS of such 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 AMPS of such series on such Auction Date.

     (f) Based on the results of each Auction for shares of a series of AMPS,
the Auction Agent will determine the aggregate number of shares of such series
to be purchased and the aggregate number of shares of such 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,


                                       57




<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, AMPS of such 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 a series of AMPS 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 AMPS that have been made in respect of Potential
Holders' or Potential Beneficial Owners' Submitted Bids for shares of such
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 AMPS of any series or
to pay for AMPS of any 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 AMPS 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 AMPS 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.

     7. Force Majeure.

     (a) Notwithstanding anything else set forth herein, if an Auction Date is
not a Business Day because the New York Stock Exchange is closed for business
for more than three consecutive Business Days due to an act of God, natural
disaster, act of war, civil or military disturbance, act of terrorism, sabotage,
riots or a loss or malfunction of utilities or communications services or the
Auction Agent is not able to conduct an Auction in accordance with the Auction
Procedures for any reason, then the Applicable Rate for the next Dividend Period
will be the Applicable Rate determined on the previous Auction Date, provided
that, if the New York Stock Exchange is closed for such reason for three or less
than three consecutive Business Days, then the Applicable Rate for the next
Dividend Period will be the Applicable Rate determined by auction on the first
Business Day following such Auction Date.

     (b) Notwithstanding anything else set forth herein, if a Dividend Payment
Date is not a Business Day because the New York Stock Exchange is closed for
business for more than three consecutive Business Days due to an act of God,
natural disaster, act of war, civil or military


                                       58




<PAGE>

disturbance, act of terrorism, sabotage, riots or a loss or malfunction of
utilities or communications services or the dividend payable on such date can
not be paid for any such reason, then:

          (i) the Dividend Payment Date for the affected Dividend Period will be
     the next Business Day on which the Fund and its paying agent, if any, are
     able to cause the dividend to be paid using their reasonable best efforts;

          (ii) the affected Dividend Period will end on the day it would have
     ended had such event not occurred and the Dividend Payment Date had
     remained the scheduled date; and

          (iii) the next Dividend Period will begin and end on the dates on
     which it would have begun and ended had such event not occurred and the
     Dividend Payment Date remained the scheduled date.

                         [Remainder of page left blank]


                                       59




<PAGE>

     IN WITNESS WHEREOF, COHEN & Steers REIT AND PREFERRED INCOME 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 August,
____ 2003.

WITNESS:


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


                                               COHEN & STEERS REIT AND PREFERRED
                                               INCOME FUND, INC.


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

     THE UNDERSIGNED, Vice President of the COHEN & STEERS REIT AND PREFERRED
INCOME 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.


                                               ---------------------------------
                                               Name:  Adam M. Derechin
                                               Title: Vice President


                                       60

</TEXT>
</DOCUMENT>
