<DOCUMENT>
<TYPE>EX-99.2A4
<SEQUENCE>2
<FILENAME>efc5-1896_5746063ex992a4.txt
<TEXT>
                                                                Exhibit (a)(4)


                            MUNIHOLDINGS FUND, INC.

                 Articles Supplementary creating one series of

                        Auction Market Preferred Stock


      MUNIHOLDINGS FUND, INC., a Maryland corporation having its principal
Maryland office in the City of Baltimore (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 Charter, the Board of Directors has
reclassified 600 authorized and unissued shares of common stock of the
Corporation as preferred stock of the Corporation and has authorized the
issuance of one series of preferred stock, par value $.10 per share,
liquidation preference $25,000 per share plus an amount equal to accumulated
but unpaid dividends (whether or not earned or declared) thereon, to be
designated: Auction Market Preferred Stock, Series C.

      SECOND: The preferences, voting powers, restrictions, limitations as to
dividends, qualifications, and terms and conditions of redemption, of the
shares of such series of preferred stock are as follows:

                                  DESIGNATION

      Series C: A series of 600 shares of preferred stock, par value $.10 per
share, liquidation preference $25,000 per share plus an amount equal to
accumulated but unpaid dividends (whether or not earned or declared) thereon,
is hereby designated "Auction Market Preferred Stock, Series C." Each share of
Auction Market Preferred Stock, Series C (sometimes referred to herein as
"Series C AMPS") shall 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

<PAGE>

Rate and an Initial Dividend Payment Date as shall 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, voting powers,
limitations as to dividends, qualifications and terms and conditions of
redemption as are set forth in these Articles Supplementary. The Auction
Market Preferred Stock, Series C shall constitute a separate series of
preferred stock of the Corporation, and each share of Auction Market Preferred
Stock, Series C shall be identical.

      1. Definitions.

      (a) Unless the context or use indicates another or different meaning or
intent, in these Articles Supplementary the following terms have the following
meanings, whether used in the singular or plural:

      "Additional Dividend" has the meaning set forth in paragraph 2(e) of
these Articles Supplementary.

      "Adviser" means the Corporation's investment adviser which initially
shall be Fund Asset Management, L.P.

      "Affiliate" means any Person, other than Merrill Lynch, Pierce, Fenner &
Smith Incorporated or its successors, known to the Auction Agent to be
controlled by, in control of, or under common control with, the Corporation.

      "Agent Member" means a member of the Securities Depository that will act
on behalf of a Beneficial Owner of one or more shares of AMPS or a Potential
Beneficial Owner.

      "AMPS" means the Auction Market Preferred Stock, Series C.

      "AMPS Basic Maintenance Amount," as of any Valuation Date, means the
dollar amount equal to (i) the sum of (A) the product of the number of shares
of AMPS and Other AMPS Outstanding on such Valuation Date multiplied by the
sum of (a) $25,000 and (b) any applicable



                                      2
<PAGE>

redemption premium attributable to the designation of a Premium Call Period;
(B) the aggregate amount of cash dividends (whether or not earned or declared)
that will have accumulated for each share of AMPS and Other AMPS Outstanding,
in each case, to (but not including) the end of the current Dividend Period
that follows such Valuation Date in the event the then current Dividend Period
will end within 49 calendar days of such Valuation Date or through the 49th
day after such Valuation Date in the event the then current Dividend Period
will not end within 49 calendar days of such Valuation Date; (C) in the event
the then current Dividend Period will end within 49 calendar days of such
Valuation Date, the aggregate amount of cash dividends that would accumulate
at the Maximum Applicable Rate applicable to a Dividend Period of 7 or fewer
days on any shares of AMPS and Other AMPS Outstanding from the end of such
Dividend Period through the 49th day after such Valuation Date, multiplied by
the larger of the Moody's Volatility Factor and the S&P Volatility Factor,
determined from time to time by Moody's and S&P, respectively (except that if
such Valuation Date occurs during a Non-Payment Period, the cash dividend for
purposes of calculation would accumulate at the then current Non-Payment
Period Rate); (D) the amount of anticipated expenses of the Corporation for
the 90 days subsequent to such Valuation Date; (E) the amount of current
outstanding balances of any indebtedness which is senior to the AMPS plus
interest actually accrued together with 30 days additional interest on the
current outstanding balances calculated at the current rate; (F) the amount of
the Corporation's Maximum Potential Additional Dividend Liability as of such
Valuation Date; and (G) any current liabilities as of such Valuation Date to
the extent not reflected in any of (i)(A) through (i)(F) (including, without
limitation, and immediately upon determination, any amounts due and payable by
the Corporation for portfolio securities purchased as of such Valuation Date
and any liabilities incurred for the purpose of clearing



                                      3
<PAGE>

securities transactions) less (ii) either (A) the Discounted Value of any of
the Corporation's assets, or (B) the face value of any of the Corporation's
assets if such assets mature prior to or on the date of redemption of AMPS or
payment of a liability and are either securities issued or guaranteed by the
United States Government or Deposit Securities, in both cases irrevocably
deposited by the Corporation for the payment of the amount needed to redeem
shares of AMPS subject to redemption or to satisfy any of (i)(B) through
(i)(G).

      "AMPS Basic Maintenance Cure Date," with respect to the failure by the
Corporation to satisfy the AMPS Basic Maintenance Amount (as required by
paragraph 7(a) of these Articles Supplementary) as of a given Valuation Date,
means the sixth Business Day following such Valuation Date.

      "AMPS Basic Maintenance Report" means a report signed by any of the
President, Treasurer, any Senior Vice President or any Vice President of the
Corporation which sets forth, as of the related Valuation Date, the assets of
the Corporation, the Market Value and the Discounted Value thereof (seriatim
and in aggregate), the AMPS Basic Maintenance Amount and the net asset value
and market trading price per share of Common Stock.

      "Anticipation Notes" shall mean the following Municipal Bonds: revenue
anticipation notes, tax anticipation notes, tax and revenue anticipation
notes, grant anticipation notes and bond anticipation notes.

      "Applicable Percentage" has the meaning set forth in paragraph
10(a)(vii) of these Articles Supplementary.

      "Applicable Rate" means the rate per annum at which cash dividends are
payable on the AMPS or Other AMPS, as the case may be, for any Dividend
Period.



                                      4
<PAGE>

      "Applicable Spread" has the meaning set forth in paragraph 10(a)(vii) of
these Articles Supplementary.

      "Auction" means a 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 of the Corporation or a duly authorized
committee thereof enters into an agreement with the Corporation to follow the
Auction Procedures for the purpose of determining the Applicable Rate and to
act as transfer agent, registrar, dividend disbursing agent and redemption
agent for the AMPS and Other AMPS.

      "Auction Date" has the meaning set forth in paragraph 10(a)(ii) of these
Articles Supplementary.

      "Auction Procedures" means the procedures for conducting Auctions set
forth in paragraph 10 of these Articles Supplementary.

      "Auditors' Confirmation" has the meaning set forth in paragraph 7(c) of
these Articles Supplementary.

      "Beneficial Owner" means a customer of a Broker-Dealer who is listed on
the records of that Broker-Dealer (or, if applicable, the Auction Agent) as a
holder of shares of AMPS or a Broker-Dealer that holds AMPS for its own
account.

      "Broker-Dealer" means any broker-dealer, or other entity permitted by
law to perform the functions required of a Broker-Dealer in paragraph 10 of
these Articles Supplementary, that has been selected by the Corporation and
has entered into a Broker-Dealer Agreement with the Auction Agent that remains
effective.



                                      5
<PAGE>

      "Broker-Dealer Agreement" means an agreement between the Auction Agent
and a Broker-Dealer pursuant to which such Broker-Dealer agrees to follow the
procedures specified in paragraph 10 of these Articles Supplementary.

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

      "Charter" means the Articles of Incorporation, as amended and
supplemented (including these Articles Supplementary), of the Corporation on
file in the State Department of Assessments and Taxation of Maryland.

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

      "Common Stock" means the common stock, par value $.10 per share, of the
Corporation.

      "Corporation" means MuniHoldings Fund, Inc., a Maryland corporation.

      "Date of Original Issue" means, with respect to any share of AMPS or
Other AMPS, the date on which the Corporation originally issues such share.

      "Deposit Securities" means cash and Municipal Bonds rated at least A2
(having a remaining maturity of 12 months or less), P-1, VMIG-1 or MIG-1 by
Moody's or A (having a remaining maturity of 12 months or less), A-1+ or SP-1+
by S&P or A (having a remaining maturity of 12 months or less) or F-1+ by
Fitch.

      "Discounted Value" means (i) with respect to an S&P Eligible Asset, the
quotient of the Market Value thereof divided by the applicable S&P Discount
Factor and (ii) with respect to a Moody's Eligible Asset, the lower of par and
the quotient of the Market Value thereof divided by the applicable Moody's
Discount Factor.



                                      6
<PAGE>

      "Dividend Payment Date," with respect to AMPS, has the meaning set forth
in paragraph 2(b)(i) of these Articles Supplementary and, with respect to
Other AMPS, has the equivalent meaning.

      "Dividend Period" means the Initial Dividend Period, any 7-Day Dividend
Period and any Special Dividend Period.

      "Existing Holder" means a Broker-Dealer or any such other Person as may
be permitted by the Corporation that is listed as the holder of record of
shares of AMPS in the Stock Books.

      "Fitch" means Fitch Ratings or its successors.

      "Forward Commitment" has the meaning set forth in paragraph 8(c) of
these Articles Supplementary.

      "High Yield Municipal Bonds" means (a) with respect to Moody's (1)
Municipal Bonds rated Ba1 to B3 by Moody's, (2) Municipal Bonds not rated by
Moody's, but rated BB+ to B- by S&P or Fitch, and (3) Municipal Bonds not
explicitly rated by Moody's, S&P or Fitch, but rated at least the equivalent
of B3 internally by the Adviser, provided that Moody's reviews and achieves
sufficient comfort with the Adviser's internal credit rating processes, and
(b) with respect to S&P (1) Municipal Bonds not rated by S&P but rated
equivalent to BBB+ or lower by another NRSRO and (2) Municipal Bonds rated BB+
or lower by S&P.

      "Holder" means a Person identified as a holder of record of shares of
AMPS in the Stock Register.

      "Independent Auditors" means a nationally recognized accountant, or firm
of accountants, that is, with respect to the Corporation, an independent
public accountant or firm of independent public accountants under the
Securities Act of 1933, as amended.



                                      7
<PAGE>

      "Initial Dividend Payment Date" means the Initial Dividend Payment Date
as determined by the Board of Directors of the Corporation with respect to the
AMPS or Other AMPS, as the case may be.

      "Initial Dividend Period," with respect to the AMPS, has the meaning set
forth in paragraph 2(c)(i) of these Articles Supplementary and, with respect
to Other AMPS, has the equivalent meaning.

      "Initial Dividend Rate," with respect to the AMPS, means the rate per
annum applicable to the Initial Dividend Period for the AMPS and, with respect
to Other AMPS, has the equivalent meaning.

      "Initial Margin" means the amount of cash or securities deposited with a
broker as a margin payment at the time of purchase or sale of a futures
contract.

      "Inverse Floaters" means trust certificates or other instruments
evidencing interests in one or more Municipal Bonds that qualify as (i) S&P
Eligible Assets the interest rates on which are adjusted at short term
intervals on a basis that is inverse to the simultaneous readjustment of the
interest rates on corresponding floating rate trust certificates or other
instruments issued by the same issuer, provided that the ratio of the
aggregate dollar amount of floating rate instruments to inverse floating rate
instruments issued by the same issuer does not exceed one to one at their time
of original issuance unless the floating rate instrument has only one reset
remaining until maturity or (ii) Moody's Eligible Assets the interest rates on
which are adjusted at short term intervals on a basis that is inverse to the
simultaneous readjustment of the interest rates on corresponding floating rate
trust certificates or other instruments issued by the same issuer, provided
that (a) such Inverse Floaters are rated by Moody's with the Adviser having
the capability to collapse (or relink) within seven (7) days as a liquidity
enhancement measure, and



                                      8
<PAGE>

(b) the issuer of such Inverse Floaters employs a leverage factor (i.e., the
ratio of underlying capital appreciation bonds or other instruments to
residual long-term derivative instruments) of not more than 2:1.

      "LIBOR Dealer" means Merrill Lynch, Pierce, Fenner & Smith Incorporated
and such other dealer or dealers as the Corporation from time to time may
appoint or, in lieu thereof, their respective affiliates and 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 shall 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



                                      9
<PAGE>

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 shall equal such arithmetic mean of such
quotations, (C) if only one or none of the Reference Banks provide such
quotations, LIBOR Rate shall 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 Corporation'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 Corporation'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 Corporation 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, the LIBOR Rate
shall be the LIBOR Rate as determined on the previous Auction Date. If the
number of Dividend Period days shall be (i) 7 or more but fewer than 21 days,
such rate shall be the seven-day LIBOR rate; (ii) 21 or more but fewer than 49
days, such rate shall be the one-month LIBOR rate; (iii) 49 or more but fewer
than 77 days, such rate shall be the two-month LIBOR rate; (iv) 77 or more but
fewer than 112 days, such rate shall be the three-month LIBOR rate; (v) 112 or
more but fewer than 140 days, such rate shall be the four-month LIBOR rate;
(vi) 140 or more but fewer than 168 days, such rate shall be the five-month
LIBOR rate; (vii) 168 or more but fewer than 189 days, such rate shall be the
six-month LIBOR rate; (viii) 189 or more but fewer than 217 days, such rate
shall be the seven-month LIBOR rate; (ix) 217 or more but fewer than 252 days,
such rate shall be the eight-month LIBOR rate; (x) 252 or more but fewer than
287 days, such rate shall be the nine-month LIBOR rate; (xi) 287 or more but
fewer than 315 days, such rate shall be the ten-month LIBOR rate; (xii) 315 or
more but fewer than 343 days, such rate shall be the eleven-month LIBOR rate;
and (xiii) 343 or more but fewer than 365 days, such rate shall be the
twelve-month LIBOR rate.



                                      10
<PAGE>

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

      "Long Term Dividend Period" means a Special Dividend Period consisting
of a specified period of one whole year or more but not greater than five
years.

      "Mandatory Redemption Price" means $25,000 per share of AMPS plus an
amount equal to accumulated but unpaid dividends (whether or not earned or
declared) to the date fixed for redemption and excluding Additional Dividends.

      "Marginal Tax Rate" means the maximum marginal regular Federal
individual income tax rate applicable to ordinary income or the maximum
marginal regular Federal corporate income tax rate, whichever is greater.

      "Market Value" of any asset of the Corporation shall be the market value
thereof determined by the Pricing Service. Market Value of any asset shall
include any interest accrued thereon. The Pricing Service shall value
portfolio securities at the quoted bid prices or the mean between the quoted
bid and asked price or the yield equivalent when quotations are not readily
available. Securities for which quotations are not readily available shall be
valued at fair value as determined by the Pricing Service using methods which
include consideration of: yields or prices of municipal bonds of comparable
quality, type of issue, coupon, maturity and rating; indications as to value
from dealers; and general market conditions. The Pricing Service may employ
electronic data processing techniques and/or a matrix system to determine
valuations. In the event the Pricing Service is unable to value a security,
the security shall be valued at the lower of two dealer bids obtained by the
Corporation from dealers who are members of the National Association of
Securities Dealers, Inc. and who make a market in the security, at least one
of which shall be in writing. Futures contracts and options are valued at



                                      11
<PAGE>

closing prices for such instruments established by the exchange or board of
trade on which they are traded, or if market quotations are not readily
available, are valued at fair value on a consistent basis using methods
determined in good faith by the Board of Directors.

      "Maximum Applicable Rate," with respect to AMPS, has the meaning set
forth in paragraph 10(a)(vii) of these Articles Supplementary and, with
respect to Other AMPS, has the equivalent meaning.

      "Maximum Potential Additional Dividend Liability," as of any Valuation
Date, means the aggregate amount of Additional Dividends that would be due if
the Corporation were to make Retroactive Taxable Allocations, with respect to
any fiscal year, estimated based upon dividends paid and the amount of
undistributed realized net capital gains and other taxable income earned by
the Corporation, as of the end of the calendar month immediately preceding
such Valuation Date and assuming such Additional Dividends are fully taxable.

      "Moody's" means Moody's Investors Service, Inc. or its successors.

      "Moody's Discount Factor" means, for purposes of determining the
Discounted Value of any Municipal Bond which constitutes a Moody's Eligible
Asset, the percentage determined by reference to the rating by Moody's, S&P or
Fitch on such Municipal Bond, in accordance with the tables (for the
applicable Moody's Exposure Period) set forth below:

                        ---------------------------------------
                             Moody's Rating Category (1)
                        ---------------------------------------
                          Aaa     Aa      A    Baa   Other (2)
                        ---------------------------------------
                         151%    159%   160%   173%    225%
                        ---------------------------------------

Footnotes:
(1) Ratings assigned by S&P or Fitch are generally accepted by Moody's at face
    value. However, adjustments to face value may be made to particular
    categories of credits for which the S&P and/or Fitch rating does not seem
    to approximate a Moody's rating equivalent. Split rated securities assigned
    by S&P and Fitch will be accepted at the lower of the two ratings.
(2) Municipal Bonds rated Ba1 to B3 by Moody's or, if not rated by Moody's,
    rated BB+ to B- by S&P or Fitch. In addition, Municipal Bonds not
    explicitly rated by Moody's, S&P or Fitch, but rated at least the
    equivalent of B3 internally by the Adviser, provided that Moody's reviews
    and achieves sufficient comfort with the Adviser's internal credit rating
    processes, will be included under "Other" in the table. 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, unrated Municipal Bonds which are rated at least
    the equivalent of B3 by the Adviser internally are limited to 10% of
    Moody's Eligible Assets.



                                      12
<PAGE>

                        ------------------------------------
                              Moody's Rating Category
                        ------------------------------------
                          MIG-1, VMIG-1,    MIG-1, VMIG-1,
                             P-1 (1)           P-1 (2)
                        ------------------------------------
                               100%              136%
                        ------------------------------------

Footnotes:
(1) Moody's rated Municipal Bonds that have a maturity less than or equal to
    49 days and Municipal Bonds not rated by Moody's but rated the equivalent
    to MIG-1, VMIG-1, or P-1 by S&P or Fitch that have a maturity less than or
    equal to 49 days.
(2) Moody's rated Municipal Bonds that have a maturity greater than 49 days
    and Municipal Bonds not rated by Moody's but rated the equivalent to MIG-1,
    VMIG-1, or P-1 by S&P or Fitch that have a maturity greater than 49 days.

      Notwithstanding the foregoing, no Moody's Discount Factor will be
applied to cash or to Receivables for Municipal Bonds Sold that are due within
five Business Days of such Valuation Date. The Moody's Discount Factor for
Receivables for Municipal Bonds Sold that are due within six and 30 Business
Days of such Valuation Date will be the Moody's Discount Factor applicable to
the Municipal Bonds sold. "Receivables for Municipal Bonds Sold," for purposes
of calculating Moody's Eligible Assets as of any Valuation Date, means the
book value of receivables for Municipal Bonds sold as of or prior to such
Valuation Date if such receivables are due within 30 Business Days of such
Valuation Date.

      The Moody's Discount Factor for Inverse Floaters shall be the product of
(x) the percentage determined by reference to the rating on the security
underlying such Inverse Floaters multiplied by (y) 1.25.

      The Moody's Discount Factor for Rule 2a-7 Money Market Funds shall be
110%.

      "Moody's Eligible Asset" means cash, Receivables for Municipal Bonds
Sold, Rule 2a-7 Money Market Funds or a Municipal Bond that (i) pays interest
in cash, (ii) is publicly rated B3 or higher by Moody's or, if not rated by
Moody's, but rated by S&P or Fitch, is publicly rated at least B- by S&P or
Fitch, or if not explicitly rated by Moody's, S&P or Fitch, be rated at least
the equivalent of B3 internally by the Adviser, provided that Moody's reviews
and achieves



                                      13
<PAGE>

sufficient comfort with the Adviser's internal credit rating processes, (iii)
does not have its Moody's rating suspended by Moody's, (iv) if an Inverse
Floater, is explicitly rated by Moody's, and (v) is part of an issue of
Municipal Bonds of at least $10,000,000 (except for issues rated Aaa by
Moody's, as provided in the chart below). In addition, Municipal Bonds in the
Corporation's portfolio must be within the following diversification
requirements in order to be included within Moody's Eligible Assets:

                                  Minimum         Maximum        Maximum State
                                Issue Size      Underlying          Allowed
Rating                          ($ Millions)  Obligor (%) (1)     (%) (1)(3)
-----------------------------   ------------  ----------------  ----------------

Aaa....................              *             100               100
Aa.....................             10              20                60
A......................             10              10                40
Baa....................             10               6                20
Ba.....................             10               4                12
B .....................             10               3                12
Other (2)..............             10               2                12

---------------------
(1)  The referenced percentages represent maximum cumulative totals for the
     related rating category and each lower rating category.
(2)  Municipal Bonds not rated by Moody's, S&P or Fitch, but rated at least
     the equivalent of B3 internally by the Adviser.
(3)  Territorial bonds (other than those issued by Puerto Rico and counted
     collectively) are each limited to 10% of Moody's Eligible Assets. For
     diversification purposes, Puerto Rico will be treated as a state.
N/A  Not applicable.

For purposes of the maximum underlying obligor requirement described above,
any Municipal Bond backed by the guaranty, letter of credit or insurance
issued by a third party will be deemed to be issued by such third party if the
issuance of such third party credit is the sole determinant of the rating on
such Bond.

      When the Corporation sells a Municipal Bond and agrees to repurchase it
at a future date, the Discounted Value of such Bond will constitute a Moody's
Eligible Asset and the amount the Corporation is required to pay upon
repurchase of such Bond will count as a liability for purposes of calculating
the AMPS Basic Maintenance Amount. For so long as the AMPS are rated by
Moody's, the Corporation will not enter into any such reverse repurchase
agreements



                                      14
<PAGE>

unless it has received written confirmation from Moody's that such
transactions would not impair the rating then assigned the AMPS by Moody's.
When the Corporation purchases a Municipal Bond and agrees to sell it at a
future date to another party, cash receivable by the Corporation thereby will
constitute a Moody's Eligible Asset if the long-term debt of such other party
is rated at least A2 by Moody's and such agreement has a term of 30 days or
less; otherwise the Discounted Value of such Bond will constitute a Moody's
Eligible Asset.

      High Yield Municipal Bonds may comprise no more than 20% of Moody's
Eligible Assets. 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, unrated
High Yield Municipal Bonds which are rated at least the equivalent of B3 by
the Adviser internally are limited to 10% of Moody's Eligible Assets.

      Inverse Floaters, including primary market and secondary market residual
interest bonds, may constitute no more than 10% of Moody's Eligible Assets.

      Notwithstanding the foregoing, an asset will not be considered a Moody's
Eligible Asset if it is (i) held in a margin account, (ii) subject to any
material lien, mortgage, pledge, security interest or security agreement of
any kind, (iii) held for the purchase of a security pursuant to a Forward
Commitment or (iv) irrevocably deposited by the Corporation for the payment of
dividends or redemption.

      "Moody's Exposure Period" means the period commencing on a given
Valuation Date and ending 49 days thereafter.

      "Moody's Hedging Transactions" has the meaning set forth in paragraph
8(b) of these Articles Supplementary.



                                      15
<PAGE>

       "Moody's Volatility Factor" means 272% as long as there has been no
increase enacted to the Marginal Tax Rate. If such an increase is enacted but
not yet implemented, the Moody's Volatility Factor shall be as follows:

                      % Change in               Moody's Volatility
                   Marginal Tax Rate                Factor
                   ------------------           ------------------

                          <=5%                       292%
                     >5% but <=10%                   313%
                     >10% but <=15%                  338%
                     >15% but <=20%                  364%
                     >20% but <=25%                  396%
                     >25% but <=30%                  432%
                     >30% but <=35%                  472%
                     >35% but <=40%                  520%



      Notwithstanding the foregoing, the Moody's Volatility Factor may mean
such other potential dividend rate increase factor as Moody's advises the
Corporation in writing is applicable.

      "Municipal Bonds" means "Municipal Bonds" as defined in the
Corporation's Registration Statement on Form N-2 (File No. 333-[________])
relating to the AMPS on file with the Securities and Exchange Commission, as
such Registration Statement may be amended from time to time, as well as
short-term municipal obligations, High Yield Municipal Bonds and Inverse
Floaters.

      "Municipal Index" has the meaning set forth in paragraph 8(a) of these
Articles Supplementary.

      "1940 Act" means the Investment Company Act of 1940, as amended from
time to time.

      "1940 Act AMPS Asset Coverage" means asset coverage, as defined in
section 18(h) of the 1940 Act, of at least 200% with respect to all
outstanding senior securities of the Corporation



                                      16
<PAGE>

which are stock, including all outstanding shares of AMPS and Other 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 paying dividends on its
common stock).

      "1940 Act Cure Date," with respect to the failure by the Corporation to
maintain the 1940 Act AMPS Asset Coverage (as required by paragraph 6 of these
Articles Supplementary) as of the last Business Day of each month, means the
last Business Day of the following month.

      "Non-Call Period" has the meaning set forth under the definition of
"Specific Redemption Provisions".

      "Non-Payment Period" means, with respect to the AMPS, any period
commencing on and including the day on which the Corporation shall fail to (i)
declare, prior to the close of business on the second Business Day preceding
any Dividend Payment Date, for payment on or (to the extent permitted by
paragraph 2(c)(i) of these Articles Supplementary) within three Business Days
after such Dividend Payment Date to the Holders as of 12:00 noon, Eastern
time, on the Business Day preceding such Dividend Payment Date, the full
amount of any dividend on shares of AMPS payable on such Dividend Payment Date
or (ii) deposit, irrevocably in trust, in same-day funds, with the Auction
Agent by 12:00 noon, Eastern time, (A) on such Dividend Payment Date the full
amount of any cash dividend on such shares payable (if declared) on such
Dividend Payment Date or (B) on any redemption date for any shares of AMPS
called for redemption, the Mandatory Redemption Price per share of such AMPS
or, in the case of an optional redemption, the Optional Redemption Price per
share, and ending on and including the Business Day on which, by 12:00 noon,
Eastern time, all unpaid cash dividends and unpaid redemption prices shall
have been so deposited or shall have otherwise been made available to



                                      17
<PAGE>

Holders in same-day funds; provided that, a Non-Payment Period shall not end
unless the Corporation shall have given at least five days' but no more than
30 days' written notice of such deposit or availability to the Auction Agent,
all Existing Holders (at their addresses appearing in the Stock Books) and the
Securities Depository. Notwithstanding the foregoing, the failure by the
Corporation to deposit funds as provided for by clauses (ii)(A) or (ii)(B)
above within three Business Days after any Dividend Payment Date or redemption
date, as the case may be, in each case to the extent contemplated by paragraph
2(c)(i) of these Articles Supplementary, shall not constitute a "Non-Payment
Period."

      "Non-Payment Period Rate" means, initially, 200% of the applicable
Reference Rate (or 300% of such rate if the Corporation has provided
notification to the Auction Agent prior to the Auction establishing the
Applicable Rate for any dividend pursuant to paragraph 2(f) hereof that net
capital gains or other taxable income will be included in such dividend on
shares of AMPS), provided that the Board of Directors of the Corporation shall
have the authority to adjust, modify, alter or change from time to time the
initial Non-Payment Period Rate if the Board of Directors of the Corporation
determines and Moody's and S&P (and any Substitute Rating Agency or Substitute
Rating Agencies, as the case may be, in lieu of Moody's or S&P, or both, in
the event either or both of such parties shall not rate the AMPS) advise the
Corporation in writing that such adjustment, modification, alteration or
change will not adversely affect their then current ratings on the AMPS.

      "Normal Dividend Payment Date" has the meaning set forth in paragraph
2(b)(i) of these Articles Supplementary.

      "Notice of Redemption" means any notice with respect to the redemption
of shares of AMPS pursuant to paragraph 4 of these Articles Supplementary.



                                      18
<PAGE>

      "Notice of Revocation" has the meaning set forth in paragraph 2(c)(iii)
of these Articles Supplementary.

      "Notice of Special Dividend Period" has the meaning set forth in
paragraph 2(c)(iii) of these Articles Supplementary.

      "NRSRO" means any nationally recognized statistical rating organization,
as that term is used in Rule 15a3-1 under the Securities Exchange Act of 1934,
as amended, or any successor provisions.

      "Optional Redemption Price" means $25,000 per share plus an amount equal
to accumulated but unpaid dividends (whether or not earned or declared) to the
date fixed for redemption and excluding Additional Dividends plus any
applicable redemption premium attributable to the designation of a Premium
Call Period.

      "Other AMPS" means the auction rate preferred stock of the Corporation,
other than the AMPS.

      "Outstanding" means, as of any date (i) with respect to AMPS, shares of
AMPS theretofore issued by the Corporation except, without duplication, (A)
any shares of AMPS theretofore cancelled or delivered to the Auction Agent for
cancellation, or redeemed by the Corporation, or as to which a Notice of
Redemption shall have been given and Deposit Securities shall have been
deposited in trust or segregated by the Corporation pursuant to paragraph 4(c)
and (B) any shares of AMPS as to which the Corporation or any Affiliate
thereof shall be a Beneficial Owner, provided that shares of AMPS held by an
Affiliate shall be deemed outstanding for purposes of calculating the AMPS
Basic Maintenance Amount and (ii) with respect to shares of other Preferred
Stock, has the equivalent meaning.



                                      19
<PAGE>

      "Parity Stock" means the AMPS and each other outstanding series of
Preferred Stock the holders of which, together with the holders of the AMPS,
shall be entitled to the receipt of dividends or of amounts distributable upon
liquidation, dissolution or winding up, as the case may be, in proportion to
the full respective preferential amounts to which they are entitled, without
preference or priority one over the other.

      "Person" means and includes an individual, a partnership, a corporation,
a trust, an unincorporated association, a joint venture or other entity or a
government or any agency or political subdivision thereof.

      "Potential Beneficial Owner" means a customer of a Broker-Dealer or a
Broker-Dealer that is not a Beneficial Owner of shares of AMPS but that wishes
to purchase such shares, or that is a Beneficial Owner that wishes to purchase
additional shares of AMPS.

      "Potential Holder" means any Broker-Dealer or any such other Person as
may be permitted by the Corporation, including any Existing Holder, who may be
interested in acquiring shares of AMPS (or, in the case of an Existing Holder,
additional shares of AMPS).

      "Preferred Stock" means the preferred stock of the Corporation, and
includes AMPS and Other AMPS.

      "Premium Call Period" has the meaning set forth under the definition of
"Specific Redemption Provisions."

      "Pricing Service" means J.J. Kenny or any pricing service designated by
the Board of Directors of the Corporation provided the Corporation obtains
written assurance from S&P and Moody's that such designation will not impair
the rating then assigned by S&P and Moody's to the AMPS.



                                      20
<PAGE>

      "Receivables for Municipal Bonds Sold" for Moody's has the meaning set
forth under the definition of Moody's Discount Factor, and for S&P has the
meaning set forth under the definition of S&P Discount Factor.

      "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 Corporation may from time
to time appoint.

      "Reference Rate" means: (i) with respect to a Dividend Period having 364
or fewer days, the higher of the applicable LIBOR Rate and the Taxable
Equivalent of the Short-Term Municipal Bond Rate, or (ii) with respect to any
Dividend Period having 365 or more days, the applicable Treasury Index Rate.

      "Request for Special Dividend Period" has the meaning set forth in
paragraph 2(c)(iii) of these Articles Supplementary.

      "Response" has the meaning set forth in paragraph 2(c)(iii) of these
Articles Supplementary.

      "Retroactive Taxable Allocation" has the meaning set forth in paragraph
2(e) of these Articles Supplementary.

      "Right" with respect to the AMPS, has the meaning set forth in paragraph
2(e) of these Articles Supplementary and, with respect to Other AMPS, has the
equivalent meaning.

      "Rule 2a-7 Money Market Funds" means investment companies registered
under the 1940 Act that comply with the requirements of Rule 2a-7 thereunder.

      "S&P" means Standard & Poor's or its successors.

      "S&P Discount Factor" means, for purposes of determining the Discounted
Value of any Municipal Bond which constitutes an S&P Eligible Asset, the
percentage determined by



                                      21
<PAGE>

reference to the rating by S&P, Moody's or Fitch on such Municipal Bond;
provided, however, for purposes of determining the S&P Discount Factor
applicable to Municipal Bonds not rated by S&P, the Municipal Bonds will carry
an S&P rating one full rating category lower than the S&P rating category that
is the equivalent of the rating category in which such Municipal Bond is
placed by a NRSRO, in accordance with the table (for the applicable S&P
Exposure Period) set forth below:

 -------------------------------------------------------------------------------
                           S&P's Rating Category (1)
 -------------------------------------------------------------------------------
  AAA* (2)     AA*       A*        BBB*      BB*       B*      CCC*       NR
 -------------------------------------------------------------------------------
   144.75%   147.75%   150.75%   153.75%   175.11%  195.11%   215.11%  220.00%
 -------------------------------------------------------------------------------
------------------
*   S&P rating.
(1) For Municipal Bonds of any one issuer rated at least BBB- by S&P, or if
    not rated by S&P, rated at least A- by another NRSRO, 2% is added to the
    applicable S&P Discount Factor for every 1% by which the Market Value of
    such Municipal Bonds exceeds 5% of the aggregate Market Value of the S&P
    Eligible Assets, but in no event greater than 10%; or for any percentage
    over 5% add 10 percentage points to the applicable S&P Discount Factor.
(2) For zero coupon Municipal Bonds, the S&P Discount Factor is 441.80%.

      Notwithstanding the foregoing, (i) the S&P Discount Factor for
short-term Municipal Bonds will be 115%, so long as such Municipal Bonds are
rated A-1+ or SP-1+ by S&P and mature or have a demand feature exercisable in
30 days or less, or 120% so long as such Municipal Bonds are rated A-1 or SP-1
by S&P and mature or have a demand feature exercisable in 30 days or less, or
125% if such Municipal Bonds are not rated by S&P but are rated VMIG-1, P-1 or
MIG-1 by Moody's or F-1+ by Fitch; provided, however, such short-term
Municipal Bonds rated by Moody's or Fitch but not rated by S&P having a demand
feature exercisable in 30 days or less must be backed by a letter of credit,
liquidity facility or guarantee from a bank or other financial institution
having a short-term rating of at least A-1+ from S&P; and further provided
that such short-term Municipal Bonds rated by Moody's or Fitch but not rated
by S&P may comprise no more than 50% of short-term Municipal Bonds that
qualify as S&P Eligible Assets, (ii) the S&P Discount Factor for Rule 2a-7
Money Market Funds will be 110%, (iii) the S&P Discount Factor for Receivables
for Municipal Bonds Sold that are due in more than five



                                      22
<PAGE>

Business Days from such Valuation Date will be the S&P Discount Factor
applicable to the Municipal Bonds sold, and (iv) no S&P Discount Factor will
be applied to cash or to Receivables for Municipal Bonds Sold if such
receivables are due within five Business Days of such Valuation Date.
"Receivables for Municipal Bonds Sold," for purposes of calculating S&P
Eligible Assets as of any Valuation Date, means the book value of receivables
for Municipal Bonds sold as of or prior to such Valuation Date. For purposes
of the foregoing, Anticipation Notes rated SP-1 or, if not rated by S&P, rated
VMIG-1 by Moody's or F-1+ by Fitch, which do not mature or have a demand
feature exercisable in 30 days and which do not have a long-term rating, shall
be considered to be short-term Municipal Bonds.

      "S&P Eligible Asset" means cash, Receivables for Municipal Bonds Sold,
Rule 2a-7 Money Market Funds or a Municipal Bond that (i) is issued by any of
the 50 states of the United States, its territories and their subdivisions,
counties, cities, towns, villages, and school districts, agencies, such as
authorities and special districts created by the states, and certain federally
sponsored agencies such as local housing authorities (payments made on these
bonds are exempt from regular federal income taxes and are generally exempt
from state and local taxes in the state of issuance), (ii) except for zero
coupon Municipal Bonds rated AAA by S&P that mature in 30 years or less, is
interest bearing and pays interest at least semi-annually; (iii) is payable
with respect to principal and interest in United States Dollars; (iv) is not
subject to a covered call or covered put option written by the Corporation;
(v) except for Inverse Floaters, is not part of a private placement; and (vi)
except for Inverse Floaters and legally defeased bonds that are secured by
securities issued or guaranteed by the United States Government, is part of an
issue of Municipal Bonds with an original issue size of at least $10 million
or, if of an issue with an



                                      23
<PAGE>

original issue size below $10 million, is rated at least AA or higher by S&P.
Notwithstanding the foregoing:

            (1) Municipal Bonds issued by issuers in any one state or
      territory will be considered S&P Eligible Assets only to the extent the
      Market Value of such Municipal Bonds does not exceed 25% of the
      aggregate Market Value of S&P Eligible Assets;

            (2) Municipal Bonds which are escrow bonds or defeased bonds may
      compose up to 100% of the aggregate Market Value of S&P Eligible Assets
      if such Bonds initially are assigned a rating by S&P in accordance with
      S&P's legal defeasance criteria or rerated by S&P as economic defeased
      escrow bonds and assigned an AAA rating. Municipal Bonds may be rated as
      escrow bonds by another NRSRO or rerated as an escrow bond and assigned
      the equivalent of an S&P AAA rating, provided that such equivalent rated
      Bonds are limited to 50% of the aggregate Market Value of S&P Eligible
      Assets and are deemed to have an AA S&P rating for purposes of
      determining the S&P Discount Factor applicable to such Municipal Bonds.
      The limitations on Municipal Bonds in clause (1) above and clauses (3)
      and (4) below are not applicable to escrow bonds;

            (3) Municipal Bonds which are not rated by any NRSRO may comprise
      no more than 10% of S&P Eligible Assets;

            (4) Municipal Bonds rated at least BBB- by S&P, or if not rated by
      S&P, rated at least A- by another NRSRO, of any one issuer or guarantor
      (excluding bond insurers) will be considered S&P Eligible Assets only to
      the extent the Market Value of such Municipal Bonds does not exceed 10%
      of the aggregate Market Value of the S&P Eligible Assets, High Yield
      Municipal Bonds of any issuer may comprise no more than



                                      24
<PAGE>

      5% of S&P Eligible Assets, and Municipal Bonds of any one issuer which
      are not rated by any NRSRO will be considered S&P Eligible Assets only to
      the extent the Market Value of such Municipal Bonds does not exceed 5% of
      the aggregate Market Value of the S&P Eligible Assets. In the aggregate,
      the maximum issuer exposure is limited to 10% of the S&P Eligible
      Assets; and

            (5) Municipal Bonds not rated by S&P but rated by another NRSRO
      will be included in S&P Eligible Assets only to the extent the Market
      Value of such Municipal Bonds does not exceed 50% of the aggregate
      Market Value of the S&P Eligible Assets.

      "S&P Exposure Period" means 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 AMPS Basic Maintenance Amount to the
Valuation Date on which the Corporation's Discounted Value of S&P Eligible
Assets failed to exceed the AMPS Basic Maintenance Amount, (ii) the maximum
number of days following a Valuation Date that the Corporation has under these
Articles Supplementary to cure any failure to maintain a Discounted Value of
S&P Eligible Assets at least equal to the AMPS Basic Maintenance Amount, and
(iii) the maximum number of days the Corporation has to effect a mandatory
redemption under Section 4(a)(ii) of these Articles Supplementary.

      "S&P Hedging Transactions" has the meaning set forth in paragraph 8(a)
of these Articles Supplementary.

      "S&P Volatility Factor" means 277% or such other potential dividend rate
increase factor as S&P advises the Corporation in writing is applicable.

      "Securities Depository" means The Depository Trust Company or any
successor company or other entities elected by the Corporation as securities
depository for the shares of



                                      25
<PAGE>

AMPS that agrees to follow the procedures required to be followed by such
securities depository in connection with the shares of AMPS.

      "Service" means the United States Internal Revenue Service.

      "7-Day Dividend Period" means a Dividend Period consisting of seven
days.

      "Short Term Dividend Period" means a Special Dividend Period consisting
of a specified number of days (other than 7), evenly divisible by seven, and
not fewer than seven nor more than 364.

      "Special Dividend Period" means a Dividend Period consisting of (i) a
specified number of days (other than 7), evenly divisible by seven and not
fewer than seven nor more than 364 or (ii) a specified period of one whole
year or more but not greater than five years (in each case subject to
adjustment as provided in paragraph 2(b)(i)).

      "Specific Redemption Provisions" means, with respect to a Special
Dividend Period either, or any combination of, (i) a period (a "Non-Call
Period") determined by the Board of Directors of the Corporation, after
consultation with the Auction Agent and the Broker-Dealers, during which the
shares of AMPS subject to such Dividend Period shall not be subject to
redemption at the option of the Corporation and (ii) a period (a "Premium Call
Period"), consisting of a number of whole years and determined by the Board of
Directors of the Corporation, after consultation with the Auction Agent and
the Broker-Dealers, during each year of which the shares of AMPS subject to
such Dividend Period shall be redeemable at the Corporation's option at a
price per share equal to $25,000 plus accumulated but unpaid dividends plus a
premium expressed as a percentage of $25,000, as determined by the Board of
Directors of the Corporation after consultation with the Auction Agent and the
Broker-Dealers.



                                      26
<PAGE>

      "Stock Books" means the books maintained by the Auction Agent setting
forth at all times a current list, as determined by the Auction Agent, of
Existing Holders of the AMPS.

      "Stock Register" means the register of Holders maintained on behalf of
the Corporation by the Auction Agent in its capacity as transfer agent and
registrar for the AMPS.

      "Subsequent Dividend Period," with respect to AMPS, has the meaning set
forth in paragraph 2(c)(i) of these Articles Supplementary and, with respect
to Other AMPS, has the equivalent meaning.

      "Substitute LIBOR Dealers" means such Substitute LIBOR Dealer or Dealers
as the Corporation may from time to time appoint or, in lieu of any thereof,
their respective affiliates or successors.

      "Substitute Rating Agency" and "Substitute Rating Agencies" mean a NRSRO
or two NRSROs, respectively, selected by Merrill Lynch, Pierce, Fenner & Smith
Incorporated or its affiliates and successors, after obtaining the
Corporation's approval, to act as the substitute rating agency or substitute
rating agencies, as the case may be, to determine the credit ratings of the
shares of AMPS.

      "Taxable Equivalent of the Short-Term Municipal Bond Rate" on any date
means 90% of the quotient of (A) the per annum rate expressed on an interest
equivalent basis equal to the Kenny S&P 30 day High Grade Index (the "Kenny
Index") or any successor index, made available for the Business Day
immediately preceding such date but in any event not later than 8:30 A.M.,
Eastern time, on such date by Kenny Information Systems Inc. or any successor
thereto, based upon 30-day yield evaluations at par of bonds the interest on
which is excludable for regular Federal income tax purposes under the Code of
"high grade" component issuers selected by Kenny Information Systems Inc. or
any such successor from time to time in its



                                      27
<PAGE>

discretion, which component issuers shall include, without limitation, issuers
of general obligation bonds but shall exclude any bonds the interest on which
constitutes an item of tax preference under Section 57(a)(5) of the Code, or
successor provisions, for purposes of the "alternative minimum tax," divided
by (B) 1.00 minus the Marginal Tax Rate (expressed as a decimal); provided,
however, that if the Kenny Index is not made so available by 8:30 A.M.,
Eastern time, on such date by Kenny Information Systems Inc. or any successor,
the Taxable Equivalent of the Short-Term Municipal Bond Rate shall mean the
quotient of (A) the per annum rate expressed on an interest equivalent basis
equal to the most recent Kenny Index so made available for any preceding
Business Day, divided by (B) 1.00 minus the Marginal Tax Rate (expressed as a
decimal). The Corporation may not utilize a successor index to the Kenny Index
unless Moody's and S&P provide the Corporation with written confirmation that
the use of such successor index will not adversely affect the then-current
respective Moody's and S&P ratings of the AMPS.

      "Treasury Bonds" means U.S. Treasury Bonds or Notes.

      "Treasury Index Rate" means the average yield to maturity for actively
traded marketable fixed interest rate U.S. Treasury 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 shall not have been
published during the 15 days



                                      28
<PAGE>

preceding the date of computation, the foregoing computations shall 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. Treasury Securities" means direct obligations of the United
States Treasury that are entitled to the full faith and credit of the United
States government.

      "Valuation Date" means, for purposes of determining whether the
Corporation is maintaining the AMPS Basic Maintenance Amount, the last
Business Day of each week commencing with the Date of Original Issue;
provided, however, that the first Valuation Date may occur on any date
established by the Corporation; provided, however, that such date shall not be
more than one week from the Date of Original Issue.

      "Variation Margin" means, in connection with an outstanding futures
contract owned or sold by the Corporation, the amount of cash or securities
paid to or received from a broker (subsequent to the Initial Margin payment)
from time to time as the price of such futures contract fluctuates.

       (b) The foregoing definitions of AMPS Basic Maintenance Amount, AMPS
Basic Maintenance Cure Date, AMPS Basic Maintenance Report, Auditors'
Confirmation, Deposit Securities, Discounted Value, High Yield Municipal
Bonds, Independent Auditors, Initial Margin, Inverse Floaters, Market Value,
Maximum Potential Additional Dividend Liability, Moody's Discount Factor,
Moody's Eligible Asset, Moody's Exposure Period, Moody's Hedging Transactions,
Moody's Volatility Factor, S&P Discount Factor, S&P Eligible Asset, S&P
Exposure Period, S&P Hedging Transactions, S&P Volatility Factor, Valuation
Date and Variation Margin have been determined by the Board of Directors of
the Corporation in order to obtain a Aaa rating from Moody's and a AAA rating
from S&P on the AMPS on their Date of



                                      29
<PAGE>

Original Issue; and the Board of Directors of the Corporation shall have the
authority, without shareholder approval, to amend, alter or repeal from time
to time by resolution or otherwise the foregoing definitions and the
restrictions and guidelines if Moody's and S&P or any Substitute Rating Agency
advises the Corporation in writing that such amendment, alteration or repeal
will not materially affect the then current rating of the AMPS. Furthermore,
if the Board of Directors determines as provided in paragraph 12 hereto not to
continue to comply with the provisions of paragraphs 7 and 8 hereof with
respect to Moody's, and any other provisions hereof with respect to obtaining
and maintaining a rating on the AMPS from Moody's, and/or paragraphs 7 and 8
hereof with respect to S&P, and any other provisions hereof with respect to
obtaining and maintaining a rating on the AMPS from S&P, then such definitions
listed in this paragraph, unless the context requires otherwise, shall have no
meaning in these Articles Supplementary for the AMPS.

      2. Dividends.

      (a) The Holders shall be entitled to receive, when, as and if declared
by the Board of Directors of the Corporation, out of funds legally available
therefor, cumulative dividends each consisting of (i) cash at the Applicable
Rate, (ii) a Right to receive cash as set forth in paragraph 2(e) below, and
(iii) any additional amounts as set forth in paragraph 2(f) below, and no
more, payable on the Dividend Payment Date set forth below. Dividends on the
shares of AMPS so declared and payable shall be paid (i) in preference to and
in priority over any dividends declared and payable on the Common Stock, and
(ii) to the extent permitted under the Code and to the extent available, out
of net tax-exempt income earned on the Corporation's investments. To the
extent permitted under the Code, dividends on shares of AMPS will be
designated as exempt-



                                      30
<PAGE>

interest dividends. For the purposes of this section, the term "net tax-exempt
income" shall exclude capital gains of the Corporation.

      (b) (i) Cash dividends on shares of AMPS shall accumulate from the Date
of Original Issue and shall be payable, when, as and if declared by the Board
of Directors, out of funds legally available therefor, commencing on the
Initial Dividend Payment Date with respect to the AMPS. Following the Initial
Dividend Payment Date for the AMPS, dividends on the AMPS will be payable, at
the option of the Corporation, either (i) with respect to any 7-Day Dividend
Period and any Short Term Dividend Period of 35 or fewer days, on the day next
succeeding the last day thereof, or (ii) with respect to any Short Term
Dividend Period of more than 35 days and with respect to any Long Term
Dividend Period, monthly on the first Business Day of each calendar month
during such Short Term Dividend Period or Long Term Dividend Period and on the
day next succeeding the last day thereof (each such date referred to in clause
(i) or (ii) being herein referred to as a "Normal Dividend Payment Date"),
except that if such Normal Dividend Payment Date is not a Business Day, then
the Dividend Payment Date shall be the first Business Day next succeeding such
Normal Dividend Payment Date. Although any particular Dividend Payment Date
may not occur on the originally scheduled date because of the exception
discussed above, the next succeeding Dividend Payment Date, subject to such
exception, will occur on the next following originally scheduled date. If for
any reason a Dividend Payment Date cannot be fixed as described above, then
the Board of Directors shall fix the Dividend Payment Date. The Board of
Directors by resolution prior to authorization of a dividend by the Board of
Directors may change a Dividend Payment Date if such change does not adversely
affect the contract rights of the Holders of shares of AMPS set forth in the
Charter. The Initial Dividend Period, 7-Day Dividend Periods and Special
Dividend Periods are



                                      31
<PAGE>

hereinafter sometimes referred to as Dividend Periods. Each dividend payment
date determined as provided above is hereinafter referred to as a "Dividend
Payment Date."

            (ii) Each dividend shall be paid to the Holders as they appear in
      the Stock Register as of 12:00 noon, Eastern time, on the Business Day
      preceding the Dividend Payment Date. Dividends in arrears for any past
      Dividend Period may be declared and paid at any time, without reference
      to any regular Dividend Payment Date, to the Holders as they appear on
      the Stock Register on a date, not exceeding 15 days prior to the payment
      date therefor, as may be fixed by the Board of Directors of the
      Corporation.

      (c) (i) During the period from and including the Date of Original Issue
to but excluding the Initial Dividend Payment Date (the "Initial Dividend
Period"), the Applicable Rate shall be the Initial Dividend Rate. Commencing
on the Initial Dividend Payment Date, the Applicable Rate for each subsequent
dividend period (hereinafter referred to as a "Subsequent Dividend Period"),
which Subsequent Dividend Period shall commence on and include a Dividend
Payment Date and shall end on and include the calendar day prior to the next
Dividend Payment Date (or last Dividend Payment Date in a Dividend Period if
there is more than one Dividend Payment Date), shall be equal to the rate per
annum that results from implementation of the Auction Procedures.

      The Applicable Rate for each Dividend Period commencing during a
Non-Payment Period shall be equal to the Non-Payment Period Rate; and each
Dividend Period, commencing after the first day of, and during, a Non-Payment
Period shall be a 7-Day Dividend Period. Except in the case of the willful
failure of the Corporation to pay a dividend on a Dividend Payment Date or to
redeem any shares of AMPS on the date set for such redemption, any amount of
any dividend due on any Dividend Payment Date (if, prior to the close of
business on the



                                      32
<PAGE>

second Business Day preceding such Dividend Payment Date, the Corporation has
declared such dividend payable on such Dividend Payment Date to the Holders of
such shares of AMPS as of 12:00 noon, Eastern time, on the Business Day
preceding such Dividend Payment Date) or redemption price with respect to any
shares of AMPS not paid to such Holders when due may be paid to such Holders
in the same form of funds by 12:00 noon, Eastern time, on any of the first
three Business Days after such Dividend Payment Date or due date, as the case
may be, provided that, such amount is accompanied by a late charge calculated
for such period of non-payment at the Non-Payment Period Rate applied to the
amount of such non-payment based on the actual number of days comprising such
period divided by 365. In the case of a willful failure of the Corporation to
pay a dividend on a Dividend Payment Date or to redeem any shares of AMPS on
the date set for such redemption, the preceding sentence shall not apply and
the Applicable Rate for the Dividend Period commencing during the Non-Payment
Period resulting from such failure shall be the Non-Payment Period Rate. For
the purposes of the foregoing, payment to a person in same-day funds on any
Business Day at any time shall be considered equivalent to payment to such
person in New York Clearing House (next day) funds at the same time on the
preceding Business Day, and any payment made after 12:00 noon, Eastern time,
on any Business Day shall be considered to have been made instead in the same
form of funds and to the same person before 12:00 noon, Eastern time, on the
next Business Day.

            (ii) The amount of cash dividends per share of the AMPS payable
      (if declared) on the Initial Dividend Payment Date and on each Dividend
      Payment Date of each 7-Day Dividend Period and each Short Term Dividend
      Period shall be computed by multiplying the Applicable Rate for such
      Dividend Period by a fraction, the numerator of which will be the number
      of days in such Dividend Period or part thereof that such share was



                                      33
<PAGE>

      outstanding and the denominator of which will be 365, multiplying the
      amount so obtained by $25,000, and rounding the amount so obtained to
      the nearest cent. During any Long Term Dividend Period, the amount of
      cash dividends per share of AMPS payable (if declared) on any Dividend
      Payment Date shall be computed by multiplying the Applicable Rate for
      such Dividend Period by a fraction, the numerator of which will be such
      number of days in such part of such Dividend Period that such share was
      outstanding and for which dividends are payable on such Dividend Payment
      Dates and the denominator of which will be 360, multiplying the amount
      so obtained by $25,000, and rounding the amount so obtained to the
      nearest cent.

            (iii) With respect to each Dividend Period that is a Special
      Dividend Period, the Corporation may, at its sole option and to the
      extent permitted by law, by telephonic and written notice (a "Request
      for Special Dividend Period") to the Auction Agent and to each
      Broker-Dealer, request that the next succeeding Dividend Period for the
      AMPS be a number of days (other than seven), evenly divisible by seven
      and not fewer than seven nor more than 364 in the case of a Short Term
      Dividend Period or one whole year or more but not greater than five
      years in the case of a Long Term Dividend Period, specified in such
      notice, provided that the Corporation may not give a Request for Special
      Dividend Period (and any such request shall be null and void) unless,
      for any Auction occurring after the initial Auction, Sufficient Clearing
      Bids were made in the last occurring Auction and unless full cumulative
      dividends, any amounts due with respect to redemptions, and any
      Additional Dividends payable prior to such date have been paid in full.
      Such Request for Special Dividend Period, in the case of a Short Term
      Dividend Period, shall be given on or prior to the second Business Day
      but not more than seven



                                      34
<PAGE>

      Business Days prior to an Auction Date for the AMPS and, in the case of
      a Long Term Dividend Period, shall be given on or prior to the second
      Business Day but not more than 28 days prior to an Auction Date for the
      AMPS. Upon receiving such Request for Special Dividend Period, the
      Broker-Dealer(s) shall jointly determine whether, given the factors set
      forth below, it is advisable that the Corporation issue a Notice of
      Special Dividend Period for the AMPS as contemplated by such Request for
      Special Dividend Period and the Optional Redemption Price of the AMPS
      during such Special Dividend Period and the Specific Redemption
      Provisions and shall give the Corporation written notice (a "Response")
      of such determination by no later than the second Business Day prior to
      such Auction Date. In making such determination the Broker-Dealer(s)
      will consider (1) existing short-term and long-term market rates and
      indices of such short-term and long-term rates, (2) existing market
      supply and demand for short-term and long-term securities, (3) existing
      yield curves for short-term and long-term securities comparable to the
      AMPS, (4) industry and financial conditions which may affect the AMPS,
      (5) the investment objective of the Corporation, and (6) the Dividend
      Periods and dividend rates at which current and potential beneficial
      holders of the AMPS would remain or become beneficial holders. If the
      Broker-Dealer(s) shall not give the Corporation a Response by such
      second Business Day or if the Response states that given the factors set
      forth above it is not advisable that the Corporation give a Notice of
      Special Dividend Period for the AMPS, the Corporation may not give a
      Notice of Special Dividend Period in respect of such Request for Special
      Dividend Period. In the event the Response indicates that it is
      advisable that the Corporation give a Notice of Special Dividend Period
      for the AMPS, the Corporation may by no later than the second



                                      35
<PAGE>

      Business Day prior to such Auction Date give a notice (a "Notice of
      Special Dividend Period") to the Auction Agent, the Securities
      Depository and each Broker-Dealer which notice will specify (i) the
      duration of the Special Dividend Period, (ii) the Optional Redemption
      Price as specified in the related Response and (iii) the Specific
      Redemption Provisions, if any, as specified in the related Response. The
      Corporation also shall provide a copy of such Notice of Special Dividend
      Period to Moody's and S&P. The Corporation shall not give a Notice of
      Special Dividend Period and, if the Corporation has given a Notice of
      Special Dividend Period, the Corporation is required to give telephonic
      and written notice of its revocation (a "Notice of Revocation") to the
      Auction Agent, each Broker-Dealer, and the Securities Depository on or
      prior to the Business Day prior to the relevant Auction Date if (x)
      either the 1940 Act AMPS Asset Coverage is not satisfied or the
      Corporation shall fail to maintain S&P Eligible Assets and Moody's
      Eligible Assets each with an aggregate Discounted Value at least equal
      to the AMPS Basic Maintenance Amount, in each case on the Valuation Date
      immediately preceding the Business Day prior to the relevant Auction
      Date on an actual basis and on a pro forma basis giving effect to the
      proposed Special Dividend Period (using as a pro forma dividend rate
      with respect to such Special Dividend Period the dividend rate which the
      Broker-Dealers shall advise the Corporation is an approximately equal
      rate for securities similar to the AMPS with an equal dividend period),
      provided that, in calculating the aggregate Discounted Value of Moody's
      Eligible Assets for this purpose, the Moody's Exposure Period shall be
      deemed to be one week longer, (y) sufficient funds for the payment of
      dividends payable on the immediately succeeding Dividend Payment Date
      have not been segregated in an account at the Corporation's custodian
      bank or on the



                                      36
<PAGE>

      books of the Corporation by the close of business on the third Business
      Day preceding the related Auction Date or (z) the Broker-Dealer(s)
      jointly advise the Corporation that after consideration of the factors
      listed above they have concluded that it is advisable to give a Notice
      of Revocation. The Corporation also shall provide a copy of such Notice
      of Revocation to Moody's and S&P. If the Corporation is prohibited from
      giving a Notice of Special Dividend Period as a result of any of the
      factors enumerated in clause (x), (y) or (z) above or if the Corporation
      gives a Notice of Revocation with respect to a Notice of Special
      Dividend Period for the AMPS, the next succeeding Dividend Period will
      be a 7-Day Dividend Period. In addition, in the event Sufficient
      Clearing Bids are not made in the applicable Auction or such Auction is
      not held for any reason, such next succeeding Dividend Period will be a
      7-Day Dividend Period and the Corporation may not again give a Notice of
      Special Dividend Period for the AMPS (and any such attempted notice
      shall be null and void) until Sufficient Clearing Bids have been made in
      an Auction with respect to a 7-Day Dividend Period.

      (d) (i) Holders shall not be entitled to any dividends, whether payable
in cash, property or stock, in excess of full cumulative dividends and
applicable late charges, as herein provided, on the shares of AMPS (except for
Additional Dividends as provided in paragraph 2(e) hereof and additional
payments as provided in paragraph 2(f) hereof). Except for the late charge
payable pursuant to paragraph 2(c)(i) hereof, no interest, or sum of money in
lieu of interest, shall be payable in respect of any dividend payment on the
shares of AMPS that may be in arrears.

            (ii) For so long as any share of AMPS is Outstanding, the
      Corporation shall not declare, pay or set apart for payment any dividend
      or other distribution (other than a



                                      37
<PAGE>

      dividend or distribution paid in shares of, or options, warrants or
      rights to subscribe for or purchase, Common Stock or other stock, if
      any, ranking junior to the shares of AMPS as to dividends or upon
      liquidation) in respect of the Common Stock or any other stock of the
      Corporation ranking junior to or on a parity with the shares of AMPS as
      to dividends or upon liquidation, or call for redemption, redeem,
      purchase or otherwise acquire for consideration any shares of the Common
      Stock or any other such junior stock (except by conversion into or
      exchange for stock of the Corporation ranking junior to the shares of
      AMPS as to dividends and upon liquidation) or any other such Parity
      Stock (except by conversion into or exchange for stock of the
      Corporation ranking junior to or on a parity with the shares of AMPS as
      to dividends and upon liquidation), unless (A) immediately after such
      transaction, the Corporation shall have S&P Eligible Assets and Moody's
      Eligible Assets each with an aggregate Discounted Value equal to or
      greater than the AMPS Basic Maintenance Amount and the Corporation shall
      maintain the 1940 Act AMPS Asset Coverage, (B) full cumulative dividends
      on shares of AMPS and shares of Other AMPS due on or prior to the date
      of the transaction have been declared and paid or shall have been
      declared and sufficient funds for the payment thereof deposited with the
      Auction Agent, (C) any Additional Dividend required to be paid under
      paragraph 2(e) below on or before the date of such declaration or
      payment has been paid and (D) the Corporation has redeemed the full
      number of shares of AMPS required to be redeemed by any provision for
      mandatory redemption contained in Section 4(a)(ii).

      (e) Each dividend shall consist of (i) cash at the Applicable Rate, (ii)
an uncertificated right (a "Right") to receive an Additional Dividend (as
defined below), and (iii) any additional amounts as set forth in paragraph
2(f) below. Each Right shall thereafter be



                                      38
<PAGE>

independent of the share or shares of AMPS on which the dividend was paid. The
Corporation shall cause to be maintained a record of each Right received by
the respective Holders. A Right may not be transferred other than by operation
of law. If the Corporation retroactively allocates any net capital gains or
other income subject to regular Federal income taxes to shares of AMPS without
having given advance notice thereof to the Auction Agent as described in
paragraph 2(f) hereof solely by reason of the fact that such allocation is
made as a result of the redemption of all or some of the outstanding shares of
AMPS or the liquidation of the Corporation (the amount of such allocation
referred to herein as a "Retroactive Taxable Allocation"), the Corporation
will, within 90 days (and generally within 60 days) after the end of the
Corporation's fiscal year for which a Retroactive Taxable Allocation is made,
provide notice thereof to the Auction Agent and to each holder of a Right
applicable to such shares of AMPS (initially Cede & Co. as nominee of The
Depository Trust Company) during such fiscal year at such holder's address as
the same appears or last appeared on the Stock Books of the Corporation. The
Corporation will, within 30 days after such notice is given to the Auction
Agent, pay to the Auction Agent (who will then distribute to such holders of
Rights), out of funds legally available therefor, an amount equal to the
aggregate Additional Dividend with respect to all Retroactive Taxable
Allocations made to such holders during the fiscal year in question.

      An "Additional Dividend" means payment to a present or former holder of
shares of AMPS of an amount which, when taken together with the aggregate
amount of Retroactive Taxable Allocations made to such holder with respect to
the fiscal year in question, would cause such holder's dividends in dollars
(after Federal income tax consequences) from the aggregate of both the
Retroactive Taxable Allocations and the Additional Dividend to be equal to the
dollar amount of the dividends which would have been received by such holder
if the amount of the



                                      39
<PAGE>

aggregate Retroactive Taxable Allocations had been excludable from the gross
income of such holder. Such Additional Dividend shall be calculated (i)
without consideration being given to the time value of money; (ii) assuming
that no holder of shares of AMPS is subject to the Federal alternative minimum
tax with respect to dividends received from the Corporation; and (iii)
assuming that each Retroactive Taxable Allocation would be taxable in the
hands of each holder of shares of AMPS at the greater of: (x) the maximum
marginal regular Federal individual income tax rate applicable to ordinary
income or capital gains depending on the taxable character of the distribution
(including any surtax); or (y) the maximum marginal regular Federal corporate
income tax rate applicable to ordinary income or capital gains depending on
the taxable character of the distribution (disregarding in both (x) and (y)
the effect of any state or local taxes and the phase out of, or provision
limiting, personal exemptions, itemized deductions, or the benefit of lower
tax brackets).

      (f) Except as provided below, whenever the Corporation intends to
include any net capital gains or other income subject to regular Federal
income taxes in any dividend on shares of AMPS, the Corporation will notify
the Auction Agent of the amount to be so included at least five Business Days
prior to the Auction Date on which the Applicable Rate for such dividend is to
be established. The Corporation may also include such income in a dividend on
shares of the AMPS without giving advance notice thereof if it increases the
dividend by an additional amount calculated as if such income was a
Retroactive Taxable Allocation and the additional amount was an Additional
Dividend, provided that the Corporation will notify the Auction Agent of the
additional amounts to be included in such dividend at least five Business Days
prior to the applicable Dividend Payment Date.

      (g) No fractional shares of AMPS shall be issued.



                                      40
<PAGE>

      3. Liquidation Rights. Upon any liquidation, dissolution or winding up
of the Corporation, whether voluntary or involuntary, the Holders shall be
entitled to receive, out of the assets of the Corporation available for
distribution to shareholders, before any distribution or payment is made upon
any Common Stock or any other capital stock ranking junior in right of payment
upon liquidation to the AMPS, the sum of $25,000 per share plus accumulated
but unpaid dividends (whether or not earned or declared) thereon to the date
of distribution, and after such payment the Holders will be entitled to no
other payments other than Additional Dividends as provided in paragraph 2(e)
hereof. If upon any liquidation, dissolution or winding up of the Corporation,
the amounts payable with respect to the AMPS and any other Outstanding class
or series of Preferred Stock of the Corporation ranking on a parity with the
AMPS as to payment upon liquidation are not paid in full, the Holders and the
holders of such other class or series will share ratably in any such
distribution of assets in proportion to the respective preferential amounts to
which they are entitled. After payment of the full amount of the liquidating
distribution to which they are entitled, the Holders will not be entitled to
any further participation in any distribution of assets by the Corporation
except for any Additional Dividends. A consolidation, merger or statutory
share exchange of the Corporation with or into any other corporation or entity
or a sale, whether for cash, shares of stock, securities or properties, of all
or substantially all or any part of the assets of the Corporation shall not be
deemed or construed to be a liquidation, dissolution or winding up of the
Corporation.

      4. Redemption.

      (a) Shares of AMPS shall be redeemable by the Corporation as provided
below:

            (i) Optional Redemption. To the extent permitted under the 1940
      Act and Maryland law, upon giving a Notice of Redemption, the
      Corporation at its option may



                                      41
<PAGE>

      redeem shares of AMPS, in whole or in part, out of funds legally
      available therefor, at the Optional Redemption Price per share, on any
      Dividend Payment Date; provided that no share of AMPS may be redeemed at
      the option of the Corporation during (A) the Initial Dividend Period
      with respect to such share or (B) a Non-Call Period to which such share
      is subject. In addition, holders of AMPS which are redeemed shall be
      entitled to receive Additional Dividends to the extent provided herein.
      The Corporation may not give a Notice of Redemption relating to an
      optional redemption as described in this paragraph 4(a)(i) unless, at
      the time of giving such Notice of Redemption, 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 due to Holders by reason of the redemption of
      their shares of AMPS on such redemption date.

            (ii) Mandatory Redemption. The Corporation shall redeem, out of
      funds legally available therefor, at the Mandatory Redemption Price per
      share, shares of AMPS to the extent permitted under the 1940 Act and
      Maryland law, on a date fixed by the Board of Directors, if the
      Corporation fails to maintain S&P Eligible Assets and Moody's Eligible
      Assets each with an aggregate Discounted Value equal to or greater than
      the AMPS Basic Maintenance Amount as provided in paragraph 7(a) or to
      satisfy the 1940 Act AMPS Asset Coverage as provided in paragraph 6 and
      such failure is not cured on or before the AMPS Basic Maintenance Cure
      Date or the 1940 Act Cure Date (herein collectively referred to as a
      "Cure Date"), as the case may be. In addition, holders of AMPS so
      redeemed shall be entitled to receive Additional Dividends to the extent
      provided herein. The number of shares of AMPS to be redeemed shall be
      equal to the lesser of (i) the minimum number of shares of AMPS the
      redemption of which, if deemed to have



                                      42
<PAGE>

      occurred immediately prior to the opening of business on the Cure Date,
      together with all shares of other Preferred Stock subject to redemption
      or retirement, would result in the Corporation having S&P Eligible
      Assets and Moody's Eligible Assets each with an aggregate Discounted
      Value equal to or greater than the AMPS Basic Maintenance Amount or
      satisfaction of the 1940 Act AMPS Asset Coverage, as the case may be, on
      such Cure Date (provided that, if there is no such minimum number of
      shares of AMPS and shares of other Preferred Stock the redemption of
      which would have such result, all shares of AMPS and shares of other
      Preferred Stock then Outstanding shall be redeemed), and (ii) the
      maximum number of shares of AMPS, together with all shares of other
      Preferred Stock subject to redemption or retirement, that can be
      redeemed out of funds expected to be legally available therefor on such
      redemption date. In determining the number of shares of AMPS required to
      be redeemed in accordance with the foregoing, the Corporation shall
      allocate the number required to be redeemed which would result in the
      Corporation having S&P Eligible Assets and Moody's Eligible Assets each
      with an aggregate Discounted Value equal to or greater than the AMPS
      Basic Maintenance Amount or satisfaction of the 1940 Act AMPS Asset
      Coverage, as the case may be, pro rata among shares of AMPS of all
      series, Other AMPS and other Preferred Stock subject to redemption
      pursuant to provisions similar to those contained in this paragraph
      4(a)(ii); provided that, shares of AMPS which may not be redeemed at the
      option of the Corporation due to the designation of a Non-Call Period
      applicable to such shares (A) will be subject to mandatory redemption
      only to the extent that other shares are not available to satisfy the
      number of shares required to be redeemed and (B) will be selected for
      redemption in an ascending order of outstanding number of days in the
      Non-



                                      43
<PAGE>

      Call Period (with shares with the lowest number of days to be redeemed
      first) and by lot in the event of shares having an equal number of days
      in such Non-Call Period. The Corporation shall effect such redemption on
      a Business Day which is not later than 30 days after such Cure Date,
      except that if the Corporation does not have funds legally available for
      the redemption of all of the required number of shares of AMPS and
      shares of other Preferred Stock which are subject to mandatory
      redemption or the Corporation otherwise is unable to effect such
      redemption on or prior to 30 days after such Cure Date, the Corporation
      shall redeem those shares of AMPS which it is unable to redeem on the
      earliest practicable date on which it is able to effect such redemption
      out of funds legally available therefor.

      (b) No Redemption Under Certain Circumstances. Notwithstanding any other
provision of this paragraph 4, no shares of AMPS may be redeemed pursuant to
paragraph 4(a)(i) of these Articles Supplementary (i) unless all dividends in
arrears on all remaining outstanding shares of Parity Stock shall have been or
are being contemporaneously paid or declared and set apart for payment and
(ii) if redemption thereof would result in the Corporation's failure to
maintain Moody's Eligible Assets or S&P Eligible Assets with an aggregate
Discounted Value equal to or greater than the AMPS Basic Maintenance Amount.
In the event that less than all the outstanding shares of AMPS are to be
redeemed and there is more than one Holder, the shares of AMPS to be redeemed
shall be selected by lot or such other method as the Corporation shall deem
fair and equitable.

      (c) Notice of Redemption. Whenever shares of AMPS are to be redeemed,
the Corporation, not less than 17 nor more than 60 days prior to the date
fixed for redemption, shall mail a notice ("Notice of Redemption") by
first-class mail, postage prepaid, to each Holder



                                      44
<PAGE>

of shares of AMPS to be redeemed and to the Auction Agent. The Corporation
shall cause the Notice of Redemption to also be published in the eastern and
national editions of The Wall Street Journal. The Notice of Redemption shall
set forth (i) the redemption date, (ii) the amount of the redemption price,
(iii) the aggregate number of shares of AMPS to be redeemed, (iv) the place or
places where shares of AMPS are to be surrendered for payment of the
redemption price, (v) a statement that dividends on the shares to be redeemed
shall cease to accumulate on such redemption date (except that holders may be
entitled to Additional Dividends) and (vi) the provision of these Articles
Supplementary pursuant to which such shares are being redeemed. No defect in
the Notice of Redemption or in the mailing or publication thereof shall affect
the validity of the redemption proceedings, except as required by applicable
law.

      If the Notice of Redemption shall have been given as aforesaid and,
concurrently or thereafter, the Corporation shall have deposited in trust with
the Auction Agent, or segregated in an account at the Corporation's custodian
bank for the benefit of the Holders of the AMPS to be redeemed and for payment
to the Auction Agent, Deposit Securities (with a right of substitution) having
an aggregate Discounted Value equal to the redemption payment for the shares
of AMPS as to which such Notice of Redemption has been given with irrevocable
instructions and authority to pay the redemption price to the Holders of such
shares, then upon the date of such deposit or, if no such deposit is made,
then upon such date fixed for redemption (unless the Corporation shall default
in making the redemption payment), all rights of the Holders of such shares as
shareholders of the Corporation by reason of the ownership of such shares will
cease and terminate (except their right to receive the redemption price in
respect thereof and any Additional Dividends, but without interest), and such
shares shall no longer be deemed outstanding. The Corporation shall be
entitled to receive, from time to time, from the Auction



                                      45
<PAGE>

Agent the interest, if any, on such Deposit Securities deposited with it and
the Holders of any shares so redeemed shall have no claim to any of such
interest. In case the Holder of any shares so called for redemption shall not
claim the redemption payment for his shares within one year after the date of
redemption, the Auction Agent shall, upon demand, pay over to the Corporation
such amount remaining on deposit and the Auction Agent shall thereupon be
relieved of all responsibility to the Holder of such shares called for
redemption and such Holder thereafter shall look only to the Corporation for
the redemption payment.

      5. Voting Rights.

      (a) General. Except as otherwise provided in the Charter or By-laws,
each Holder of shares of AMPS shall be entitled to one vote for each share
held on each matter submitted to a vote of shareholders of the Corporation,
and the holders of outstanding shares of Preferred Stock, including AMPS, and
of shares of Common Stock shall vote together as a single class; provided
that, at any meeting of the shareholders of the Corporation held for the
election of directors, the holders of outstanding shares of Preferred Stock,
including AMPS, shall be entitled, as a class, to the exclusion of the holders
of all other securities and classes of capital stock of the Corporation, to
elect two directors of the Corporation. Subject to paragraph 5(b) hereof, the
holders of outstanding shares of capital stock of the Corporation, including
the holders of outstanding shares of Preferred Stock, including AMPS, voting
as a single class, shall elect the balance of the directors.

      (b) Right to Elect Majority of Board of Directors. During any period in
which any one or more of the conditions described below shall exist (such
period being referred to herein as a "Voting Period"), the number of directors
constituting the Board of Directors shall be automatically increased by the
smallest number that, when added to the two directors elected



                                      46
<PAGE>

exclusively by the holders of shares of Preferred Stock, would constitute a
majority of the Board of Directors as so increased by such smallest number;
and the holders of shares of Preferred Stock shall be entitled, voting
separately as one class (to the exclusion of the holders of all other
securities and classes of capital stock of the Corporation), to elect such
smallest number of additional directors, together with the two directors that
such holders are in any event entitled to elect. A Voting Period shall
commence:

            (i) if at any time accumulated dividends (whether or not earned or
      declared, and whether or not funds are then legally available in an
      amount sufficient therefor) on the outstanding shares of AMPS equal to
      at least two full years' dividends shall be due and unpaid and
      sufficient cash or specified securities shall not have been deposited
      with the Auction Agent for the payment of such accumulated dividends; or

            (ii) if at any time holders of any other shares of Preferred Stock
      are entitled to elect a majority of the directors of the Corporation
      under the 1940 Act.

      Upon the termination of a Voting Period, the voting rights described in
this paragraph 5(b) shall cease, subject always, however, to the reverting of
such voting rights in the Holders upon the further occurrence of any of the
events described in this paragraph 5(b).

      (c) Right to Vote with Respect to Certain Other Matters. So long as any
shares of AMPS are outstanding, the Corporation shall not, without the
affirmative vote of the holders of a majority of the shares of Preferred Stock
Outstanding at the time, voting separately as one class: (i) authorize, create
or issue any class or series of stock ranking prior to the AMPS or any other
series of Preferred Stock with respect to payment of dividends or the
distribution of assets on dissolution, liquidation or winding up the affairs
of the Corporation, or (ii) amend, alter or repeal the provisions of the
Charter, whether by merger, consolidation or otherwise, so as to adversely



                                      47
<PAGE>

affect any of the contract rights expressly set forth in the Charter of
holders of shares of AMPS or any other Preferred Stock. To the extent
permitted under the 1940 Act, in the event shares of more than one series of
Preferred Stock are outstanding, the Corporation shall not approve any of the
actions set forth in clause (i) or (ii) which adversely affects the contract
rights expressly set forth in the Charter of a Holder of shares of AMPS
differently than those of a Holder of shares of any other series of Preferred
Stock without the affirmative vote of the holders of at least a majority of
the shares of AMPS adversely affected and outstanding at such time (voting
separately as a class). The Corporation shall notify Moody's and S&P ten
Business Days prior to any such vote described in clause (i) or (ii). Unless a
higher percentage is provided for under the Charter, the affirmative vote of
the holders of a majority of the outstanding shares of Preferred Stock,
including AMPS, voting together as a single class, will be required to approve
any plan of reorganization (including bankruptcy proceedings) adversely
affecting such shares or any action requiring a vote of security holders under
Section 13(a) of the 1940 Act. So long as any shares of the AMPS are
outstanding, the affirmative vote of the holders of a majority of the
outstanding shares of Preferred Stock, including AMPS, voting together as a
single class, will be required to approve any voluntary application by the
Corporation for relief under Federal bankruptcy law or any similar application
under state law for so long as the Corporation is solvent and does not foresee
becoming insolvent. For purposes of the two preceding sentences, the phrase
"vote of the holders of a majority of the outstanding shares of Preferred
Stock" shall have the meaning set forth in the 1940 Act. The class vote of
holders of shares of Preferred Stock, including AMPS, described above will in
each case be in addition to a separate vote of the requisite percentage of
shares of Common Stock and shares of Preferred Stock, including AMPS, voting
together as a single class necessary to authorize the action in question. An
increase in the



                                      48
<PAGE>

number of authorized shares of Preferred Stock pursuant to the Charter or the
issuance of additional shares of any series of Preferred Stock (including AMPS
and Other AMPS) pursuant to the Charter shall not in and of itself be
considered to adversely affect the contract rights of the holders of the AMPS.

      Notwithstanding the foregoing, and except as otherwise required by the
1940 Act, (i) holders of outstanding shares of the AMPS will be entitled as a
series, to the exclusion of the holders of all other securities, including
other Preferred Stock, Common Stock and other classes of capital stock of the
Corporation, to vote on matters affecting the AMPS that do not materially
adversely affect any of the contract rights of holders of such other
securities, including other Preferred Stock, Common Stock and other classes of
capital stock, as expressly set forth in the Charter, and (ii) holders of
outstanding shares of AMPS will not be entitled to vote on matters affecting
any other Preferred Stock that do not materially adversely affect any of the
contract rights of holders of the AMPS, as expressly set forth in the Charter.

      (d) Voting Procedures.

            (i) As soon as practicable after the accrual of any right of the
      holders of shares of Preferred Stock to elect additional directors as
      described in paragraph 5(b) above, the Corporation shall call a special
      meeting of such holders and instruct the Auction Agent to mail a notice
      of such special meeting to such holders, such meeting to be held not
      less than 10 nor more than 20 days after the date of mailing of such
      notice. If the Corporation fails to send such notice to the Auction
      Agent or if the Corporation 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 shall be the close of business on the fifth Business Day
      preceding the day on



                                      49
<PAGE>

      which such notice is mailed. At any such special meeting and at each
      meeting held during a Voting Period, 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), shall be entitled to elect
      the number of directors prescribed in paragraph 5(b) above. At any such
      meeting or adjournment thereof in the absence of a quorum, a majority of
      such holders present in person or by proxy shall have the power to
      adjourn the meeting without notice, other than by an announcement at the
      meeting, to a date not more than 120 days after the original record
      date.

            (ii) For purposes of determining any rights of the Holders to vote
      on any matter or the number of shares required to constitute a quorum,
      whether such right is created by these Articles Supplementary, by the
      other provisions of the Charter, by statute or otherwise, a share of
      AMPS which is not Outstanding shall not be counted.

            (iii) The terms of office of all persons who are directors of the
      Corporation at the time of a special meeting of Holders and holders of
      other Preferred Stock to elect directors shall continue, notwithstanding
      the election at such meeting by the Holders and such other holders of
      the number of directors that they are entitled to elect, and the persons
      so elected by the Holders and such other holders, together with the two
      incumbent directors elected by the Holders and such other holders of
      Preferred Stock and the remaining incumbent directors elected by the
      holders of the Common Stock and Preferred Stock, shall constitute the
      duly elected directors of the Corporation.

            (iv) Simultaneously with the expiration of a Voting Period, the
      terms of office of the additional directors elected by the Holders and
      holders of other Preferred Stock pursuant to paragraph 5(b) above shall
      terminate, the remaining directors shall constitute



                                      50
<PAGE>

      the directors of the Corporation and the voting rights of the Holders
      and such other holders to elect additional directors pursuant to
      paragraph 5(b) above shall cease, subject to the provisions of the last
      sentence of paragraph 5(b).

      (e) Exclusive Remedy. Unless otherwise required by law, the Holders of
shares of AMPS shall not have any rights or preferences other than those
specifically set forth herein. The Holders of shares of AMPS shall have no
preemptive rights or rights to cumulative voting. In the event that the
Corporation fails to pay any dividends on the shares of AMPS, the exclusive
remedy of the Holders shall be the right to vote for directors pursuant to the
provisions of this paragraph 5.

      (f) Notification to S&P and Moody's. In the event a vote of Holders of
AMPS is required pursuant to the provisions of Section 13(a) of the 1940 Act,
the Corporation shall, not later than ten Business Days prior to the date on
which such vote is to be taken, notify S&P and Moody's that such vote is to be
taken and the nature of the action with respect to which such vote is to be
taken and, not later than ten Business Days after the date on which such vote
is taken, notify S&P and Moody's of the result of such vote.

      6. 1940 Act AMPS Asset Coverage. The Corporation shall maintain, as of
the last Business Day of each month in which any share of AMPS is outstanding,
the 1940 Act AMPS Asset Coverage.

      7. AMPS Basic Maintenance Amount.

      (a) The Corporation shall maintain, on each Valuation Date, and shall
verify to its satisfaction that it is maintaining on such Valuation Date, (i)
S&P Eligible Assets having an aggregate Discounted Value equal to or greater
than the AMPS Basic Maintenance Amount and (ii) Moody's Eligible Assets having
an aggregate Discounted Value equal to or greater than the



                                      51
<PAGE>

AMPS Basic Maintenance Amount. Upon any failure to maintain the required
Discounted Value, the Corporation will use its best efforts to alter the
composition of its portfolio to reattain a Discounted Value at least equal to
the AMPS Basic Maintenance Amount on or prior to the AMPS Basic Maintenance
Cure Date.

      (b) On or before 5:00 p.m., Eastern time, on the seventh Business Day in
the case of Moody's and on the next Business Day in the case of S&P, after a
Valuation Date on which the Corporation fails to satisfy the AMPS Basic
Maintenance Amount, the Corporation shall (i) complete and deliver to Moody's
a complete AMPS Basic Maintenance Report as of the date of such failure and
(ii) send S&P an electronic notification of such failure. The Corporation will
(i) deliver an AMPS Basic Maintenance Report to Moody's and (ii) send S&P an
electronic notification on or before 5:00 p.m., Eastern time, on the seventh
Business Day in the case of Moody's and on the next Business Day in the case
of S&P, after a Valuation Date on which the Corporation cures its failure to
maintain Moody's Eligible Assets or S&P Eligible Assets, as the case may be,
with an aggregate Discounted Value equal to or greater than the AMPS Basic
Maintenance Amount and on which the Corporation fails to maintain Moody's
Eligible Assets or S&P Eligible Assets, as the case may be, with an aggregate
Discounted Value which exceeds the AMPS Basic Maintenance Amount by 10% or
more. The Corporation will also deliver an AMPS Basic Maintenance Report to
Moody's and S&P as of the 25th day of each month (or if such day is not a
Business Day, as of the next succeeding Business Day) or as the last Business
Day of the month in which the Corporation's fiscal year ends on or before the
seventh Business Day after such date. The Corporation shall also provide
Moody's and S&P with an AMPS Basic Maintenance Report when specifically
requested by either Moody's or S&P. A failure by the Corporation to deliver an
AMPS Basic Maintenance Report under this paragraph 7(b) shall be



                                      52
<PAGE>

deemed to be delivery of an AMPS Basic Maintenance Report indicating the
Discounted Value for S&P Eligible Assets and Moody's Eligible Assets of the
Corporation is less than the AMPS Basic Maintenance Amount, as of the relevant
Valuation Date.

      (c) Within ten Business Days after the date of delivery of an AMPS Basic
Maintenance Report in accordance with paragraph 7(b) above relating to the
month in which the Corporation's fiscal year ends, the Independent Auditors
will confirm in writing to S&P and Moody's (i) the mathematical accuracy of
the calculations reflected in such Report, (ii) that, in such Report, the
Corporation correctly determined the assets of the Corporation which
constitute S&P Eligible Assets or Moody's Eligible Assets, as the case may be,
at its fiscal year end in accordance with these Articles Supplementary, and
(iii) that, in such Report, the Corporation determined whether the Corporation
had, at its fiscal year end in accordance with these Articles Supplementary,
S&P Eligible Assets of an aggregate Discounted Value at least equal to the
AMPS Basic Maintenance Amount and Moody's Eligible Assets of an aggregate
Discounted Value at least equal to the AMPS Basic Maintenance Amount (such
confirmation is herein called the "Auditors' Confirmation").

      (d) Within ten Business Days after the date of delivery to Moody's of an
AMPS Basic Maintenance Report in accordance with paragraph 7(b) above relating
to any Valuation Date on which the Corporation failed to maintain S&P Eligible
Assets with an aggregate Discounted Value and Moody's Eligible Assets with an
aggregate Discounted Value equal to or greater than the AMPS Basic Maintenance
Amount, and relating to the AMPS Basic Maintenance Cure Date with respect to
such failure, the Independent Auditors will provide to S&P and Moody's an
Auditors' Confirmation as to such AMPS Basic Maintenance Report.



                                      53
<PAGE>

      (e) If any Auditors' Confirmation delivered pursuant to subparagraph (c)
or (d) of this paragraph 7 shows that an error was made in the AMPS Basic
Maintenance Report for a particular date for which such Auditors' Confirmation
as required to be delivered, or shows that a lower aggregate Discounted Value
for the aggregate of all S&P Eligible Assets or Moody's Eligible Assets, as
the case may be, of the Corporation was determined by the Independent
Auditors, the calculation or determination made by such Independent Auditors
shall be final and conclusive and shall be binding on the Corporation, and the
Corporation shall accordingly amend and deliver the AMPS Basic Maintenance
Report to S&P and Moody's promptly following receipt by the Corporation of
such Auditors' Confirmation.

      (f) On or before 5:00 p.m., Eastern time, on the first Business Day
after the Date of Original Issue of the shares of AMPS, the Corporation will
complete and deliver to S&P and Moody's an AMPS Basic Maintenance Report as of
the close of business on such Date of Original Issue. Within five Business
Days of such Date of Original Issue, the Independent Auditors will confirm in
writing to S&P and Moody's (i) the mathematical accuracy of the calculations
reflected in such Report and (ii) that the aggregate Discounted Value of S&P
Eligible Assets and the aggregate Discounted Value of Moody's Eligible Assets
reflected thereon equals or exceeds the AMPS Basic Maintenance Amount
reflected thereon. Also, on or before 5:00 p.m., Eastern time, on the first
Business Day after shares of Common Stock are repurchased by the Corporation,
the Corporation will complete and deliver to S&P and Moody's an AMPS Basic
Maintenance Report as of the close of business on such date that Common Stock
is repurchased.

      (g) For so long as shares of AMPS are rated by Moody's, in managing the
Corporation's portfolio, the Adviser will not alter the composition of the
Corporation's portfolio



                                      54
<PAGE>

if, in the reasonable belief of the Adviser, the effect of any such alteration
would be to cause the Corporation to have Moody's Eligible Assets with an
aggregate Discounted Value, as of the immediately preceding Valuation Date,
less than the AMPS Basic Maintenance Amount as of such Valuation Date;
provided, however, that in the event that, as of the immediately preceding
Valuation Date, the aggregate Discounted Value of Moody's Eligible Assets
exceeded the AMPS Basic Maintenance Amount by five percent or less, the
Adviser will not alter the composition of the Corporation's portfolio in a
manner reasonably expected to reduce the aggregate Discounted Value of Moody's
Eligible Assets unless the Corporation shall have confirmed that, after giving
effect to such alteration, the aggregate Discounted Value of Moody's Eligible
Assets would exceed the AMPS Basic Maintenance Amount.

      8. Certain Other Restrictions and Requirements.

      (a) For so long as any shares of AMPS are rated by S&P, the Corporation
will not purchase or sell futures contracts, write, purchase or sell options
on futures contracts or write put options (except covered put options) or call
options (except covered call options) on portfolio securities unless it
receives written confirmation from S&P that engaging in such transactions will
not impair the ratings then assigned to the shares of AMPS by S&P, except that
the Corporation may purchase or sell futures contracts based on the Bond Buyer
Municipal Bond Index (the "Municipal Index") or Treasury Bonds and write,
purchase or sell put and call options on such contracts (collectively, "S&P
Hedging Transactions"), subject to the following limitations:

            (i) the Corporation will not engage in any S&P Hedging Transaction
      based on the Municipal Index (other than transactions which terminate a
      futures contract or option held by the Corporation by the Corporation's
      taking an opposite position thereto



                                      55
<PAGE>

      ("Closing Transactions")), which would cause the Corporation at the time
      of such transaction to own or have sold the least of (A) more than 1,000
      outstanding futures contracts based on the Municipal Index, (B)
      outstanding futures contracts based on the Municipal Index exceeding in
      number 25% of the quotient of the Market Value of the Corporation's
      total assets divided by $1,000 or (C) outstanding futures contracts
      based on the Municipal Index exceeding in number 10% of the average
      number of daily traded futures contracts based on the Municipal Index in
      the 30 days preceding the time of effecting such transaction as reported
      by The Wall Street Journal;

            (ii) the Corporation will not engage in any S&P Hedging
      Transaction based on Treasury Bonds (other than Closing Transactions)
      which would cause the Corporation at the time of such transaction to own
      or have sold the lesser of (A) outstanding futures contracts based on
      Treasury Bonds exceeding in number 50% of the quotient of the Market
      Value of the Corporation's total assets divided by $100,000 ($200,000 in
      the case of the two-year United States Treasury Note) or (B) outstanding
      futures contracts based on Treasury Bonds exceeding in number 10% of the
      average number of daily traded futures contracts based on Treasury Bonds
      in the 30 days preceding the time of effecting such transaction as
      reported by The Wall Street Journal;

            (iii) the Corporation will engage in Closing Transactions to close
      out any outstanding futures contract which the Corporation owns or has
      sold or any outstanding option thereon owned by the Corporation in the
      event (A) the Corporation does not have S&P Eligible Assets with an
      aggregate Discounted Value equal to or greater than the AMPS Basic
      Maintenance Amount on two consecutive Valuation Dates and (B) the
      Corporation is required to pay Variation Margin on the second such
      Valuation Date;



                                      56
<PAGE>

            (iv) the Corporation will engage in a Closing Transaction to close
      out any outstanding futures contract or option thereon in the month
      prior to the delivery month under the terms of such futures contract or
      option thereon unless the Corporation holds the securities deliverable
      under such terms; and

            (v) when the Corporation writes a futures contract or option
      thereon, it will either maintain an amount of cash, cash equivalents or
      liquid assets in a segregated account with the Corporation's custodian,
      so that the amount so segregated plus the amount of Initial Margin and
      Variation Margin held in the account of or on behalf of the
      Corporation's broker with respect to such futures contract or option
      equals the Market Value of the futures contract or option, or, in the
      event the Corporation writes a futures contract or option thereon which
      requires delivery of an underlying security, it shall hold such
      underlying security in its portfolio.

      For purposes of determining whether the Corporation has S&P Eligible
Assets with a Discounted Value that equals or exceeds the AMPS Basic
Maintenance Amount, the Discounted Value of cash or securities held for the
payment of Initial Margin or Variation Margin shall be zero and the aggregate
Discounted Value of S&P Eligible Assets shall be reduced by an amount equal to
(i) 30% of the aggregate settlement value, as marked to market, of any
outstanding futures contracts based on the Municipal Index which are owned by
the Corporation plus (ii) 25% of the aggregate settlement value, as marked to
market, of any outstanding futures contracts based on Treasury Bonds which
contracts are owned by the Corporation.

      (b) For so long as any shares of AMPS are rated by Moody's, the
Corporation will not engage in Bond Market Association Municipal Swap Index
swap transactions ("BMA swap transactions"), buy or sell futures contracts,
write, purchase or sell call options on futures



                                      57
<PAGE>

contracts or purchase put options on futures contracts or write call options
(except covered call options) on portfolio securities unless it receives
written confirmation from Moody's that engaging in such transactions would not
impair the ratings then assigned to the shares of AMPS by Moody's, except that
the Corporation may engage in BMA swap transactions, purchase or sell
exchange-traded futures contracts based on any index approved by Moody's or
Treasury Bonds and purchase, write or sell exchange-traded put options on such
futures contracts (collectively, "Moody's Hedging Transactions"), subject to
the following limitations:

            (i) the Corporation will not engage in any Moody's Hedging
      Transaction based on the Municipal Index (other than Closing
      Transactions) which would cause the Corporation at the time of such
      transaction to own or have sold (A) outstanding futures contracts based
      on the Municipal Index exceeding in number 10% of the average number of
      daily traded futures contracts based on the Municipal Index in the 30
      days preceding the time of effecting such transaction as reported by The
      Wall Street Journal or (B) outstanding futures contracts based on the
      Municipal Index having a Market Value exceeding 50% of the Market Value
      of all Municipal Bonds constituting Moody's Eligible Assets owned by the
      Corporation (other than Moody's Eligible Assets already subject to a
      Moody's Hedging Transaction);

            (ii) the Corporation will not engage in any Moody's Hedging
      Transaction based on Treasury Bonds (other than Closing Transactions)
      which would cause the Corporation at the time of such transaction to own
      or have sold (A) outstanding futures contracts based on Treasury Bonds
      having an aggregate Market Value exceeding 40% of the aggregate Market
      Value of Moody's Eligible Assets owned by the Corporation and rated Aa
      by Moody's (or, if not rated by Moody's but rated by S&P, rated AAA by
      S&P)



                                      58
<PAGE>

      or (B) outstanding futures contracts based on Treasury Bonds having an
      aggregate Market Value exceeding 80% of the aggregate Market Value of
      all Municipal Bonds constituting Moody's Eligible Assets owned by the
      Corporation (other than Moody's Eligible Assets already subject to a
      Moody's Hedging Transaction) and rated Baa or A by Moody's (or, if not
      rated by Moody's but rated by S&P, rated A or AA by S&P) (for purposes
      of the foregoing clauses (i) and (ii), the Corporation shall be deemed
      to own the number of futures contracts that underlie any outstanding
      options written by the Corporation);

            (iii) the Corporation will engage in Closing Transactions to close
      out any outstanding futures contract based on the Municipal Index if the
      amount of open interest in the Municipal Index as reported by The Wall
      Street Journal is less than 5,000;

            (iv) the Corporation will engage in a Closing Transaction to close
      out any outstanding futures contract by no later than the fifth Business
      Day of the month in which such contract expires and will engage in a
      Closing Transaction to close out any outstanding option on a futures
      contract by no later than the first Business Day of the month in which
      such option expires;

            (v) the Corporation will engage in Moody's Hedging Transactions
      only with respect to futures contracts or options thereon having the
      next settlement date or the settlement date immediately thereafter;

            (vi) the Corporation (A) will not engage in options and futures
      transactions for leveraging or speculative purposes, except that the
      Corporation may engage in an option or futures transaction so long as
      the combination of the Corporation's non-derivative positions, together
      with the relevant option or futures transaction, produces a synthetic



                                      59
<PAGE>

      investment position, or the same economic result, that could be achieved
      by an investment, consistent with the Corporation's investment objective
      and policies, in a security that is not an option or futures
      transaction, subject to the Adviser periodically demonstrating to
      Moody's that said economic results are achieved, and (B) will not write
      any call options or sell any futures contracts for the purpose of
      hedging the anticipated purchase of an asset prior to completion of such
      purchase;

            (vii) the Corporation will not enter into an option or futures
      transaction unless, after giving effect thereto, the Corporation would
      continue to have Moody's Eligible Assets with an aggregate Discounted
      Value equal to or greater than the AMPS Basic Maintenance Amount; and

            (viii) the Corporation will not engage in BMA swap transactions
      with respect to more than 20% of the Corporation's net assets; provided
      that the Corporation's use of futures will proportionately decrease as
      the Corporation's use of BMA swap transactions increases, and
      vice-versa.

      For purposes of determining whether the Corporation has Moody's Eligible
Assets with an aggregate Discounted Value that equals or exceeds the AMPS
Basic Maintenance Amount, the Discounted Value of Moody's Eligible Assets
which the Corporation is obligated to deliver or receive pursuant to an
outstanding futures contract or option shall be as follows: (i) assets subject
to call options written by the Corporation which are either exchange-traded
and "readily reversible" or which expire within 49 days after the date as of
which such valuation is made shall be valued at the lesser of (a) Discounted
Value and (b) the exercise price of the call option written by the
Corporation; (ii) assets subject to call options written by the Corporation
not meeting the requirements of clause (i) of this sentence shall have no
value; (iii) assets subject to



                                      60
<PAGE>

put options written by the Corporation shall be valued at the lesser of (A)
the exercise price and (B) the Discounted Value of the subject security; (iv)
futures contracts shall be valued at the lesser of (A) settlement price and
(B) the Discounted Value of the subject security, provided that, if a contract
matures within 49 days after the date as of which such valuation is made,
where the Corporation is the seller the contract may be valued at the
settlement price and where the Corporation is the buyer the contract may be
valued at the Discounted Value of the subject securities; and (v) where
delivery may be made to the Corporation with any security of a class of
securities, the Corporation shall assume that it will take delivery of the
security with the lowest Discounted Value.

      For purposes of determining whether the Corporation has Moody's Eligible
Assets with an aggregate Discounted Value that equals or exceeds the AMPS
Basic Maintenance Amount, the following amounts shall be subtracted from the
aggregate Discounted Value of the Moody's Eligible Assets held by the
Corporation: (i) 10% of the exercise price of a written call option; (ii) the
exercise price of any written put option; (iii) where the Corporation is the
seller under a futures contract, 10% of the settlement price of the futures
contract; (iv) where the Corporation is the purchaser under a futures
contract, the settlement price of assets purchased under such futures
contract; (v) the settlement price of the underlying futures contract if the
Corporation writes put options on a futures contract; and (vi) 105% of the
Market Value of the underlying futures contracts if the Corporation writes
call options on a futures contract and does not own the underlying contract.

      (c) For so long as any shares of AMPS are rated by Moody's, the
Corporation will not enter into any contract to purchase securities for a
fixed price at a future date beyond customary settlement time (other than such
contracts that constitute Moody's Hedging



                                      61
<PAGE>

Transactions that are permitted under paragraph 8(b) of these Articles
Supplementary), except that the Corporation may enter into such contracts to
purchase newly-issued securities on the date such securities are issued
("Forward Commitments"), subject to the following limitations:

            (i) the Corporation will maintain in a segregated account with its
      custodian cash, cash equivalents or short-term, fixed-income securities
      rated P-1, MIG-1 or VMIG-1 by Moody's and maturing prior to the date of
      the Forward Commitment with a Market Value that equals or exceeds the
      amount of the Corporation's obligations under any Forward Commitments to
      which it is from time to time a party or long-term, fixed-income
      securities with a Discounted Value that equals or exceeds the amount of
      the Corporation's obligations under any Forward Commitment to which it
      is from time to time a party; and

            (ii) the Corporation will not enter into a Forward Commitment
      unless, after giving effect thereto, the Corporation would continue to
      have Moody's Eligible Assets with an aggregate Discounted Value equal to
      or greater than the AMPS Basic Maintenance Amount.

      (d) For purposes of determining whether the Corporation has Moody's
Eligible Assets with an aggregate Discounted Value that equals or exceeds the
AMPS Basic Maintenance Amount, the Discounted Value of all Forward Commitments
to which the Corporation is a party and of all securities deliverable to the
Corporation pursuant to such Forward Commitments shall be zero.

      (e) For so long as shares of AMPS are rated by S&P or Moody's, the
Corporation will not, unless it has received written confirmation from S&P
and/or Moody's, as the case may be, that such action would not impair the
ratings then assigned to shares of AMPS by S&P and/or



                                      62
<PAGE>

Moody's, as the case may be, (i) borrow money except for the purpose of
clearing transactions in portfolio securities (which borrowings shall under
any circumstances be limited to the lesser of $10 million and an amount equal
to 5% of the Market Value of the Corporation's assets at the time of such
borrowings and which borrowings shall be repaid within 60 days and not be
extended or renewed and shall not cause the aggregate Discounted Value of
Moody's Eligible Assets and S&P Eligible Assets to be less than the AMPS Basic
Maintenance Amount), (ii) engage in short sales of securities, (iii) lend any
securities, (iv) issue any class or series of stock ranking prior to or 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
Corporation, (v) reissue any AMPS previously purchased or redeemed by the
Corporation, (vi) merge or consolidate into or with any other corporation or
entity, (vii) change the Pricing Service or (viii) engage in reverse
repurchase agreements.

      (f) For as long as the AMPS are rated by S&P, the Corporation will not,
unless it has received written confirmation from S&P that such action would
not impair the rating then assigned to the shares of AMPS by S&P, engage in
interest rate swaps, caps and floors, except that the Corporation may, without
obtaining the written consent described above, engage in swaps, caps and
floors if: (i) the counterparty to the swap transaction has a short-term
rating of A-1 or, if the counterparty does not have a short-term rating, the
counterparty's senior unsecured long-term debt rating is A- or higher, (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 AMPS Basic Maintenance Amount
on two consecutive Valuation Dates then the



                                      63
<PAGE>

agreement shall terminate immediately, (v) for the purpose of calculating the
Discounted Value of S&P Eligible Assets, 90% of any positive mark-to-market
valuation of the Corporation's rights will be S&P Eligible Assets, 100% of any
negative mark-to-market valuation of the Corporation's rights will be included
in the calculation of the AMPS Basic Maintenance Amount, and (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, the Corporation must
maintain liquid assets with a value at least equal to the Corporation's
obligations with respect to such caps or floors.

      (g) For so long as shares of AMPS are rated by S&P or Moody's, as the
case may be, the Corporation agrees to provide S&P and/or Moody's with the
following, unless the Corporation has received written confirmation from S&P
and/or Moody's, as the case may be, that the provision of such information is
no longer required and that the current rating then assigned to the shares of
AMPS by S&P and/or Moody's, as the case may be, would not be impaired: a
notification letter at least 30 days prior to any material change in the
Charter; a copy of the AMPS Basic Maintenance Report prepared by the
Corporation in accordance with these Articles Supplementary; and a notice upon
the occurrence of any of the following events: (i) any failure by the
Corporation to declare or pay any dividends on the AMPS or successfully
remarket the AMPS; (ii) any mandatory or optional redemption of the AMPS
effected by the Corporation; (iii) any assumption of control of the Board of
Directors of the Corporation by the holders of the AMPS; (iv) a general
unavailability of dealer quotes on the assets of the Corporation; (v) any
material auditor discrepancies on valuations; (vi) the occurrence of any
Special Dividend Period; (vii) any change in the Maximum Applicable Rate or
the Reference Rate; (viii) the acquisition by any person of beneficial
ownership of more than 5% of the Corporation's voting stock (inclusive



                                      64
<PAGE>

of Common Stock and Preferred Stock); (ix) the occurrence of any change in
Internal Revenue Service rules with respect to the payment of Additional
Dividends; (x) any change in the Pricing Service employed by the Corporation;
(xi) any change in the Adviser; (xii) any increase of greater than 40% to the
maximum marginal Federal income tax rate applicable to individuals or
corporations; and (xiii) the maximum marginal Federal income tax rate
applicable to individuals or corporations is increased to a rate in excess of
50%.

      (h) For so long as shares of AMPS are rated by S&P or Moody's, the
Corporation shall provide S&P and/or Moody's with a copy of the Corporation's
annual audited financial statements as soon as practicable (not later than 60
days) after such annual audited financial statements have been made available
to the Corporation's stockholders.

      9. Notice. All notices or communications, unless otherwise specified in
the By-laws of the Corporation or these Articles Supplementary, shall be
sufficiently given if in writing and delivered in person or mailed by
first-class mail, postage prepaid. Notice shall be deemed given on the earlier
of the date received or the date seven days after which such notice is mailed.

      10. Auction Procedures.

      (a) Certain definitions. As used in this paragraph 10, the following
terms shall have the following meanings, unless the context otherwise
requires:

            (i) "AMPS" means the shares of AMPS being auctioned pursuant to
      this paragraph 10.

            (ii) "Auction Date" means the first Business Day preceding the
      first day of a Dividend Period.

            (iii) "Available AMPS" has the meaning specified in paragraph
      10(d)(i) below.

            (iv) "Bid" has the meaning specified in paragraph 10(b)(i) below.



                                      65
<PAGE>

            (v) "Bidder" has the meaning specified in paragraph 10(b)(i)
      below.

            (vi) "Hold Order" has the meaning specified in paragraph 10(b)(i)
      below.

            (vii) "Maximum Applicable Rate" for any Dividend Period will be
      the higher of the Applicable Percentage of the Reference Rate or the
      Applicable Spread plus the Reference Rate. The Applicable Percentage and
      Applicable Spread will be determined based on (i) the lower of the
      credit rating or ratings assigned on such date to such shares by Moody's
      and S&P (or if Moody's or S&P or both shall not make such rating
      available, the equivalent of either or both of such ratings by a
      Substitute Rating Agency or two Substitute Rating Agencies or, in the
      event that only one such rating shall be available, such rating) and
      (ii) whether the Corporation has provided notification to the Auction
      Agent prior to the Auction establishing the Applicable Rate for any
      dividend pursuant to paragraph 2(f) hereof that net capital gains or
      other taxable income will be included in such dividend on shares of AMPS
      as follows:

<TABLE>
<CAPTION>
                                   Applicable      Applicable      Applicable     Applicable
                                   Percentage of   Percentage of   Spread over    Spread over
           Credit Ratings          Reference       Reference       Reference      Reference
                                   Rate - No       Rate -          Rate - No      Rate -
        Moody's         S&P        Notification    Notification    Notification   Notification
     ------------   ------------   -------------   -------------   ------------   ------------
     <S>            <C>               <C>             <C>             <C>           <C>
         Aaa            AAA           110%            125%            1.10%         1.25%
      Aa3 to Aa1     AA- to AA+       125%            150%            1.25%         1.50%
       A3 to A1       A- to A+        150%            200%            1.50%         2.00%
     Baa3 to Baa1   BBB- to BBB+      175%            250%            1.75%         2.50%
      Below Baa3     Below BBB-       200%            300%            2.00%         3.00%
</TABLE>

      The Applicable Percentage and the Applicable Spread as so determined may
be further subject to upward but not downward adjustment in the discretion of
the Board of Directors of the Corporation after consultation with the
Broker-Dealers, provided that immediately following any such increase the
Corporation would be in compliance with the AMPS Basic Maintenance Amount.
Subject to the provisions of paragraph 12, the Corporation shall take all
reasonable



                                      66
<PAGE>

action necessary to enable S&P and Moody's to provide a rating for the AMPS.
If either S&P or Moody's shall not make such a rating available, or neither
S&P nor Moody's shall make such a rating available, subject to the provisions
of paragraph 12, Merrill Lynch, Pierce, Fenner & Smith Incorporated or its
affiliates and successors, after obtaining the Corporation's approval, shall
select a NRSRO or two NRSROs to act as a Substitute Rating Agency or
Substitute Rating Agencies, as the case may be.

            (viii) "Order" has the meaning specified in paragraph 10(b)(i)
      below.

            (ix) "Sell Order" has the meaning specified in paragraph 10(b)(i)
      below.

            (x) "Submission Deadline" means 1:00 P.M., Eastern time, on any
      Auction Date or such other time on any Auction Date as may be specified
      by the Auction Agent from time to time as the time by which each
      Broker-Dealer must submit to the Auction Agent in writing all Orders
      obtained by it for the Auction to be conducted on such Auction Date.

            (xi) "Submitted Bid" has the meaning specified in paragraph
      10(d)(i) below.

            (xii) "Submitted Hold Order" has the meaning specified in
      paragraph 10(d)(i) below.

            (xiii) "Submitted Order" has the meaning specified in paragraph
      10(d)(i) below.

            (xiv) "Submitted Sell Order" has the meaning specified in
      paragraph 10(d)(i) below.

            (xv) "Sufficient Clearing Bids" has the meaning specified in
      paragraph 10(d)(i) below.

            (xvi) "Winning Bid Rate" has the meaning specified in paragraph
      10(d)(i) below.



                                      67
<PAGE>

      (b) Orders by Beneficial Owners, Potential Beneficial Owners, Existing
Holders and Potential Holders. (i) Unless otherwise permitted by the
Corporation, Beneficial Owners and Potential Beneficial Owners may only
participate in Auctions through their Broker-Dealers. Broker-Dealers will
submit the Orders of their respective customers who are Beneficial Owners and
Potential Beneficial Owners to the Auction Agent, designating themselves as
Existing Holders in respect of shares subject to Orders submitted or deemed
submitted to them by Beneficial Owners and as Potential Holders in respect of
shares subject to Orders submitted to them by Potential Beneficial Owners. A
Broker-Dealer may also hold shares of AMPS in its own account as a Beneficial
Owner. A Broker-Dealer may thus submit Orders to the Auction Agent as a
Beneficial Owner or a Potential Beneficial Owner and therefore participate in
an Auction as an Existing Holder or Potential Holder on behalf of both itself
and its customers. On or prior to the Submission Deadline on each Auction
Date:

                  (A) each Beneficial Owner may submit to its Broker-Dealer
            information as to:

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

                        (2) the number of Outstanding shares, if any, of AMPS
                  held by such Beneficial Owner which such Beneficial Owner
                  desires to continue to hold, provided that the Applicable
                  Rate for the next succeeding Dividend Period shall not be
                  less than the rate per annum specified by such Beneficial
                  Owner; and/or



                                      68
<PAGE>

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

                  (B) each Broker-Dealer, using a list of Potential Beneficial
            Owners that shall be maintained in good faith for the purpose of
            conducting a competitive Auction, shall contact Potential
            Beneficial Owners, including Persons that are not Beneficial
            Owners, on such list to determine the number of Outstanding
            shares, if any, of AMPS which each such Potential Beneficial Owner
            offers to purchase, provided that the Applicable Rate for the next
            succeeding Dividend Period shall not be less than the rate per
            annum specified by such Potential Beneficial Owner.

      For the purposes hereof, the communication by a Beneficial Owner or
Potential Beneficial Owner to a Broker-Dealer, or the communication by a
Broker-Dealer acting for its own account to the Auction Agent, of information
referred to in clause (A) or (B) of this paragraph 10(b)(i) is hereinafter
referred to as an "Order" and each Beneficial Owner and each Potential
Beneficial Owner placing an Order, including a Broker-Dealer acting in such
capacity for its own account, is hereinafter referred to as a "Bidder"; an
Order containing the information referred to in clause (A)(1) of this
paragraph 10(b)(i) is hereinafter referred to as a "Hold Order"; an Order
containing the information referred to in clause (A)(2) or (B) of this
paragraph 10(b)(i) is hereinafter referred to as a "Bid"; and an Order
containing the information referred to in clause (A)(3) of this paragraph
10(b)(i) is hereinafter referred to as a "Sell Order". Inasmuch as a
Broker-Dealer participates in an Auction as an Existing Holder or a Potential
Holder only to represent the interests of a Beneficial Owner or Potential
Beneficial Owner, whether it be its



                                      69
<PAGE>

customers or itself, all discussion herein relating to the consequences of an
Auction for Existing Holders and Potential Holders also applies to the
underlying beneficial ownership interests represented.

            (ii) (A) A Bid by an Existing Holder shall constitute an irrevocable
      offer to sell:

                    (1) the number of Outstanding shares of AMPS specified in
               such Bid if the Applicable Rate determined on such Auction Date
               shall be less than the rate per annum specified in such Bid; or

                    (2) such number or a lesser number of Outstanding shares
               of AMPS to be determined as set forth in paragraph 10(e)(i)(D)
               if the Applicable Rate determined on such Auction Date shall be
               equal to the rate per annum specified therein; or

                    (3) a lesser number of Outstanding shares of AMPS to be
               determined as set forth in paragraph 10(e)(ii)(C) if such
               specified rate per annum shall be higher than the Maximum
               Applicable Rate and Sufficient Clearing Bids do not exist.

                  (B) A Sell Order by an Existing Holder shall constitute an
            irrevocable offer to sell:

                        (1) the number of Outstanding shares of AMPS specified
                  in such Sell Order; or

                        (2) such number or a lesser number of Outstanding
                  shares of AMPS to be determined as set forth in paragraph
                  10(e)(ii)(C) if Sufficient Clearing Bids do not exist.



                                      70
<PAGE>

                  (C) A Bid by a Potential Holder shall constitute an
            irrevocable offer to purchase:

                        (1) the number of Outstanding shares of AMPS specified
                  in such Bid if the Applicable Rate determined on such
                  Auction Date shall be higher than the rate per annum
                  specified in such Bid; or

                        (2) such number or a lesser number of Outstanding
                  shares of AMPS to be determined as set forth in paragraph
                  10(e)(i)(E) if the Applicable Rate determined on such
                  Auction Date shall be equal to the rate per annum specified
                  therein.

      (c) Submission of Orders by Broker-Dealers to Auction Agent.

            (i) Each Broker-Dealer shall submit in writing or through mutually
      acceptable electronic means to the Auction Agent prior to the Submission
      Deadline on each Auction Date all Orders 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 specifying with respect to each Order:

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

                  (B) the aggregate number of Outstanding shares of AMPS that
            are the subject of such Order;

                  (C) to the extent that such Bidder is an Existing Holder:



                                      71
<PAGE>

                        (1) the number of Outstanding shares, if any, of AMPS
                  subject to any Hold Order placed by such Existing Holder;

                        (2) the number of Outstanding shares, if any, of AMPS
                  subject to any Bid placed by such Existing Holder and the
                  rate per annum specified in such Bid; and

                        (3) the number of Outstanding shares, if any, of AMPS
                  subject to any Sell Order placed by such Existing Holder;
                  and

                  (D) to the extent such Bidder is a Potential Holder, the
            rate per annum specified in such Potential Holder's Bid.

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

            (iii) If an Order or Orders covering all of the Outstanding shares
      of AMPS held by an Existing Holder are not submitted to the Auction
      Agent prior to the Submission Deadline, the Auction Agent shall deem a
      Hold Order (in the case of an Auction relating to a Dividend Period
      which is not a Special Dividend Period of more than 7 days) and a Sell
      Order (in the case of an Auction relating to a Special Dividend Period
      of more than 7 days) to have been submitted on behalf of such Existing
      Holder covering the number of Outstanding shares of AMPS held by such
      Existing Holder and not subject to Orders submitted to the Auction
      Agent.

            (iv) If one or more Orders on behalf of an Existing Holder
      covering in the aggregate more than the number of Outstanding shares of
      AMPS held by such Existing



                                      72
<PAGE>

      Holder are submitted to the Auction Agent, such Order shall be
      considered valid as follows and in the following order of priority:

                  (A) any Hold Order submitted on behalf of such Existing
            Holder shall be considered valid up to and including the number of
            Outstanding shares of AMPS held by such Existing Holder; provided
            that if more than one Hold Order is submitted on behalf of such
            Existing Holder and the number of shares of AMPS subject to such
            Hold Orders exceeds the number of Outstanding shares of AMPS held
            by such Existing Holder, the number of shares of AMPS subject to
            each of such Hold Orders shall be reduced pro rata so that such
            Hold Orders, in the aggregate, will cover exactly the number of
            Outstanding shares of AMPS held by such Existing Holder;

                  (B) any Bids submitted on behalf of such Existing Holder
            shall be considered valid, in the ascending order of their
            respective rates per annum if more than one Bid is submitted on
            behalf of such Existing Holder, up to and including the excess of
            the number of Outstanding shares of AMPS held by such Existing
            Holder over the number of shares of AMPS subject to any Hold Order
            referred to in paragraph 10(c)(iv)(A) above (and if more than one
            Bid submitted on behalf of such Existing Holder specifies the same
            rate per annum and together they cover more than the remaining
            number of shares that can be the subject of valid Bids after
            application of paragraph 10(c)(iv)(A) above and of the foregoing
            portion of this paragraph 10(c)(iv)(B) to any Bid or Bids
            specifying a lower rate or rates per annum, the number of shares
            subject to each of such Bids shall be reduced pro rata so that
            such Bids, in the aggregate, cover exactly such remaining



                                      73
<PAGE>

            number of shares); and the number of shares, if any, subject to
            Bids not valid under this paragraph 10(c)(iv)(B) shall be treated
            as the subject of a Bid by a Potential Holder; and

                  (C) any Sell Order shall be considered valid up to and
            including the excess of the number of Outstanding shares of AMPS
            held by such Existing Holder over the number of shares of AMPS
            subject to Hold Orders referred to in paragraph 10(c)(iv)(A) and
            Bids referred to in paragraph 10(c)(iv)(B); provided that if more
            than one Sell Order is submitted on behalf of any Existing Holder
            and the number of shares of AMPS subject to such Sell Orders is
            greater than such excess, the number of shares of AMPS subject to
            each of such Sell Orders shall be reduced pro rata so that such
            Sell Orders, in the aggregate, cover exactly the number of shares
            of AMPS equal to such excess.

            (v) If more than one Bid is submitted on behalf of any Potential
      Holder, each Bid submitted shall be a separate Bid with the rate per
      annum and number of shares of AMPS therein specified.

            (vi) Any Order submitted by a Beneficial Owner as 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
      shall be irrevocable.

      (d) Determination of Sufficient Clearing Bids, Winning Bid Rate and
Applicable Rate. (i) Not earlier than the Submission Deadline on each Auction
Date, the Auction Agent shall assemble all Orders submitted or deemed
submitted to it by the Broker-Dealers (each such Order as submitted or deemed
submitted by a Broker-Dealer being hereinafter referred to



                                      74
<PAGE>

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 shall
determine:

                  (A) the excess of the total number of Outstanding shares of
            AMPS over the number of Outstanding shares of AMPS that are the
            subject of Submitted Hold Orders (such excess being hereinafter
            referred to as the "Available AMPS");

                  (B) from the Submitted Orders whether the number of
            Outstanding shares of AMPS that are the subject of Submitted Bids
            by Potential Holders specifying one or more rates per annum equal
            to or lower than the Maximum Applicable Rate exceeds or is equal
            to the sum of:

                        (1) the number of Outstanding shares of AMPS that are
                  the subject of Submitted Bids by Existing Holders specifying
                  one or more rates per annum higher than the Maximum
                  Applicable Rate, and

                        (2) the number of Outstanding shares of AMPS that are
                  subject to Submitted Sell Orders (if such excess or such
                  equality exists (other than because the number of
                  Outstanding shares of AMPS in clause (1) above and this
                  clause (2) are each zero because all of the Outstanding
                  shares of AMPS are the subject of Submitted Hold Orders),
                  such Submitted Bids by Potential Holders being hereinafter
                  referred to collectively as "Sufficient Clearing Bids"); and

                  (C) if Sufficient Clearing Bids exist, the lowest rate per
            annum specified in the Submitted Bids (the "Winning Bid Rate")
            that if:

                        (1) each Submitted Bid from Existing Holders
                  specifying the Winning Bid Rate and all other Submitted Bids
                  from Existing Holders



                                      75
<PAGE>

                  specifying lower rates per annum were rejected, thus
                  entitling such Existing Holders to continue to hold the
                  shares of AMPS that are the subject of such Submitted Bids,
                  and

                        (2) each Submitted Bid from Potential Holders
                  specifying the Winning Bid Rate and all other Submitted Bids
                  from Potential Holders specifying lower rates per annum were
                  accepted, thus entitling the Potential Holders to purchase
                  the shares of AMPS that are the subject of such Submitted
                  Bids,

      would result in the number of shares subject to all Submitted Bids
specifying the Winning Bid Rate or a lower rate per annum being at least equal
to the Available AMPS.

            (ii) Promptly after the Auction Agent has made the determinations
      pursuant to paragraph 10(d)(i), the Auction Agent shall advise the
      Corporation of the Maximum Applicable Rate and, based on such
      determinations, the Applicable Rate for the next succeeding Dividend
      Period as follows:

                  (A) if Sufficient Clearing Bids exist, that the Applicable
            Rate for the next succeeding Dividend Period shall be equal to the
            Winning Bid Rate;

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

                  (C) if all of the Outstanding shares of AMPS are the subject
            of Submitted Hold Orders, the Dividend Period next succeeding the
            Auction shall automatically be the same length as the immediately
            preceding Dividend Period



                                      76
<PAGE>

            and the Applicable Rate for the next succeeding Dividend Period
            shall be equal to 60% of the Reference Rate (or 90% of such rate
            if the Corporation has provided notification to the Auction Agent
            prior to the Auction establishing the Applicable Rate for any
            dividend pursuant to paragraph 2(f) hereof that net capital gains
            or other taxable income will be included in such dividend on
            shares of AMPS) on the date of the Auction.

      (e) Acceptance and Rejection of Submitted Bids and Submitted Sell Orders
and Allocation of Shares.

      Based on the determinations made pursuant to paragraph 10(d)(i), the
Submitted Bids and Submitted Sell Orders shall be accepted or rejected and the
Auction Agent shall take such other action as set forth below:

            (i) If Sufficient Clearing Bids have been made, subject to the
      provisions of paragraph 10(e)(iii) and paragraph 10(e)(iv), Submitted
      Bids and Submitted Sell Orders shall be accepted or rejected in the
      following order of priority and all other Submitted Bids shall be
      rejected:

                  (A) the Submitted Sell Orders of Existing Holders shall be
            accepted and the Submitted Bid of each of the Existing Holders
            specifying any rate per annum that is higher than the Winning Bid
            Rate shall be accepted, thus requiring each such Existing Holder
            to sell the Outstanding shares of AMPS that are the subject of
            such Submitted Sell Order or Submitted Bid;

                  (B) the Submitted Bid of each of the Existing Holders
            specifying any rate per annum that is lower than the Winning Bid
            Rate shall be rejected, thus



                                      77
<PAGE>

            entitling each such Existing Holder to continue to hold the
            Outstanding shares of AMPS that are the subject of such Submitted
            Bid;

                  (C) the Submitted Bid of each of the Potential Holders
            specifying any rate per annum that is lower than the Winning Bid
            Rate shall be accepted;

                  (D) the Submitted Bid of each of the Existing Holders
            specifying a rate per annum that is equal to the Winning Bid Rate
            shall be rejected, thus entitling each such Existing Holder to
            continue to hold the Outstanding shares of AMPS that are the
            subject of such Submitted Bid, unless the number of Outstanding
            shares of AMPS subject to all such Submitted Bids shall be greater
            than the number of Outstanding shares of AMPS ("Remaining Shares")
            equal to the excess of the Available AMPS over the number of
            Outstanding shares of AMPS subject to Submitted Bids described in
            paragraph 10(e)(i)(B) and paragraph 10(e)(i)(C), in which event
            the Submitted Bids of each such Existing Holder shall be accepted,
            and each such Existing Holder shall be required to sell
            Outstanding shares of AMPS, but only in an amount equal to the
            difference between (1) the number of Outstanding shares of AMPS
            then held by such Existing Holder subject to such Submitted Bid
            and (2) the number of shares of AMPS obtained by multiplying (x)
            the number of Remaining Shares by (y) a fraction the numerator of
            which shall be the number of Outstanding shares of AMPS held by
            such Existing Holder subject to such Submitted Bid and the
            denominator of which shall be the sum of the number of Outstanding
            shares of AMPS subject to such Submitted Bids made by all such
            Existing Holders that specified a rate per annum equal to the
            Winning Bid Rate; and



                                      78
<PAGE>

                  (E) the Submitted Bid of each of the Potential Holders
            specifying a rate per annum that is equal to the Winning Bid Rate
            shall be accepted but only in an amount equal to the number of
            Outstanding shares of AMPS obtained by multiplying (x) the
            difference between the Available AMPS and the number of
            Outstanding shares of AMPS subject to Submitted Bids described in
            paragraph 10(e)(i)(B), paragraph 10(e)(i)(C) and paragraph
            10(e)(i)(D) by (y) a fraction the numerator of which shall be the
            number of Outstanding shares of AMPS subject to such Submitted Bid
            and the denominator of which shall be the sum of the number of
            Outstanding shares of AMPS subject to such Submitted Bids made by
            all such Potential Holders that specified rates per annum equal to
            the Winning Bid Rate.

            (ii) If Sufficient Clearing Bids have not been made (other than
      because all of the Outstanding shares of AMPS are subject to Submitted
      Hold Orders), subject to the provisions of paragraph 10(e)(iii),
      Submitted Orders shall be accepted or rejected as follows in the
      following order of priority and all other Submitted Bids shall be
      rejected:

                  (A) the Submitted Bid of each Existing Holder specifying any
            rate per annum that is equal to or lower than the Maximum
            Applicable Rate shall be rejected, thus entitling such Existing
            Holder to continue to hold the Outstanding shares of AMPS that are
            the subject of such Submitted Bid;

                  (B) the Submitted Bid of each Potential Holder specifying
            any rate per annum that is equal to or lower than the Maximum
            Applicable Rate shall be accepted, thus requiring such Potential
            Holder to purchase the Outstanding shares of AMPS that are the
            subject of such Submitted Bid; and



                                      79
<PAGE>

                  (C) the Submitted Bids of each Existing Holder specifying
            any rate per annum that is higher than the Maximum Applicable Rate
            shall be accepted and the Submitted Sell Orders of each Existing
            Holder shall be accepted, in both cases only in an amount equal to
            the difference between (1) the number of Outstanding shares of
            AMPS then held by such Existing Holder subject to such Submitted
            Bid or Submitted Sell Order and (2) the number of shares of AMPS
            obtained by multiplying (x) the difference between the Available
            AMPS and the aggregate number of Outstanding shares of AMPS
            subject to Submitted Bids described in paragraph 10(e)(ii)(A) and
            paragraph 10(e)(ii)(B) by (y) a fraction the numerator of which
            shall be the number of Outstanding shares of AMPS held by such
            Existing Holder subject to such Submitted Bid or Submitted Sell
            Order and the denominator of which shall be the number of
            Outstanding shares of AMPS subject to all such Submitted Bids and
            Submitted Sell Orders.

            (iii) If, as a result of the procedures described in paragraph
      10(e)(i) or paragraph 10(e)(ii), 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 AMPS on any Auction Date,
      the Auction Agent shall, in such manner as in its sole discretion it
      shall determine, round up or down the number of shares of AMPS to be
      purchased or sold by any Existing Holder or Potential Holder on such
      Auction Date so that each Outstanding share of AMPS purchased or sold by
      each Existing Holder or Potential Holder on such Auction Date shall be a
      whole share of AMPS.

            (iv) If, as a result of the procedures described in paragraph
      10(e)(i), any Potential Holder would be entitled or required to purchase
      less than a whole share of



                                      80
<PAGE>

      AMPS on any Auction Date, the Auction Agent shall, in such manner as in
      its sole discretion it shall determine, allocate shares of AMPS for
      purchase among Potential Holders so that only whole shares of AMPS are
      purchased on such Auction Date by any Potential Holder, even if such
      allocation results in one or more of such Potential Holders not
      purchasing any shares of AMPS on such Auction Date.

            (v) Based on the results of each Auction, the Auction Agent shall
      determine, with respect to each Broker-Dealer that submitted Bids or
      Sell Orders on behalf of Existing Holders or Potential Holders, the
      aggregate number of Outstanding shares of AMPS to be purchased and the
      aggregate number of the Outstanding shares of AMPS to be sold by such
      Potential Holders and Existing Holders and, to the extent that such
      aggregate number of Outstanding shares to be purchased and such
      aggregate number of Outstanding shares to be sold differ, the Auction
      Agent shall determine to which other Broker-Dealer or Broker-Dealers
      acting for one or more purchasers such Broker-Dealer shall deliver, or
      from which other Broker-Dealer or Broker-Dealers acting for one or more
      sellers such Broker-Dealer shall receive, as the case may be,
      Outstanding shares of AMPS.

      (f) Miscellaneous. The Corporation may interpret the provisions of this
paragraph 10 to resolve any inconsistency or ambiguity, remedy any formal
defect or make any other change or modification that does not substantially
adversely affect the rights of Beneficial Owners of AMPS. A Beneficial Owner
or an Existing Holder (A) may sell, transfer or otherwise dispose of shares of
AMPS only pursuant to a Bid or Sell Order in accordance with the procedures
described in this paragraph 10 or to or through a Broker-Dealer, provided that
in the case of all transfers other than pursuant to Auctions such Beneficial
Owner or Existing Holder, its Broker-



                                      81
<PAGE>

Dealer, if applicable, or its Agent Member advises the Auction Agent of such
transfer and (B) except as otherwise required by law, shall have the ownership
of the shares of AMPS held by it maintained in book entry form by the
Securities Depository in the account of its Agent Member, which in turn will
maintain records of such Beneficial Owner's beneficial ownership. Neither the
Corporation nor any Affiliate, other than an Affiliate that is a
Broker-Dealer, shall submit an Order in any Auction. Any Beneficial Owner that
is an Affiliate shall not sell, transfer or otherwise dispose of shares of
AMPS to any Person other than the Corporation. All of the Outstanding shares
of AMPS shall be represented by a single certificate registered in the name of
the nominee of the Securities Depository unless otherwise required by law or
unless there is no Securities Depository. If there is no Securities
Depository, at the Corporation's option and upon its receipt of such documents
as it deems appropriate, any shares of AMPS may be registered in the Stock
Register in the name of the Beneficial Owner thereof and such Beneficial Owner
thereupon will be entitled to receive certificates therefor and required to
deliver certificates therefor upon transfer or exchange thereof.

      11. Securities Depository; Stock Certificates.

      (a) If there is a Securities Depository, one certificate for all of the
shares of AMPS shall be issued to the Securities Depository and registered in
the name of the Securities Depository or its nominee. Additional certificates
may be issued as necessary to represent shares of AMPS. All such certificates
shall bear a legend to the effect that such certificates are issued subject to
the provisions restricting the transfer of shares of AMPS contained in these
Articles Supplementary. Unless the Corporation shall have elected, during a
Non-Payment Period, to waive this requirement, the Corporation will also issue
stop-transfer instructions to the Auction Agent for the shares of AMPS. Except
as provided in paragraph (b) below, the Securities



                                      82
<PAGE>

Depository or its nominee will be the Holder, and no Beneficial Owner shall
receive certificates representing its ownership interest in such shares.

      (b) If the Applicable Rate applicable to all shares of AMPS of a series
shall be the Non-Payment Period Rate or there is no Securities Depository, the
Corporation may at its option issue one or more new certificates with respect
to such shares (without the legend referred to in paragraph 11(a)) registered
in the names of the Beneficial Owners or their nominees and rescind the
stop-transfer instructions referred to in paragraph 11(a) with respect to such
shares.

      12. Termination of Rating Agency Provisions.

      (a) The Board of Directors may determine that it is not in the best
interests of the Corporation to continue to comply with the provisions of
paragraphs 7 and 8 hereof with respect to Moody's, and any other provisions
hereof with respect to obtaining and maintaining a rating on the AMPS from
Moody's (together, the "Moody's Provisions"), and paragraphs 7 and 8 hereof
with respect to S&P, and any other provisions hereof with respect to obtaining
and maintaining a rating on the AMPS from S&P (together, the "S&P
Provisions"), in which case the Corporation will no longer be required to
comply with any of the Moody's Provisions or the S&P Provisions, as the case
may be, provided that (i) the Corporation has given the Auction Agent, the
Broker-Dealers, Moody's or S&P and Holders of the AMPS at least 45 calendar
days written notice of such termination of compliance, (ii) the Corporation is
in compliance with the Moody's Provisions and the S&P Provisions, as the case
may be, at the time the notice required in clause (i) hereof is given and at
the time of the termination of compliance with the Moody's Provisions or the
S&P Provisions, and (iii) the AMPS continue to be rated by at least one NRSRO
at the time of the termination of compliance with the Moody's Provisions or
the S&P Provisions, as the case may be.



                                      83
<PAGE>

      (b) On the date that the notice is given in paragraph 12(a) above and on
the date that compliance with the Moody's Provisions and/or the S&P
Provisions, as the case may be, is terminated, the Corporation shall provide
the Auction Agent and Moody's or S&P, as applicable, with an officers'
certificate as to the compliance with the provisions of paragraph 12(a)
hereof, and the Moody's Provisions and/or the S&P Provisions, as applicable,
on such later date and thereafter shall have no force or effect.



                                      84
<PAGE>

      IN WITNESS WHEREOF, MUNIHOLDINGS FUND, INC. has caused these Articles
Supplementary to be signed in its name and on its behalf by its Vice President,
and attested by its Secretary, on the     day of                      , 2005.


                                MUNIHOLDINGS FUND, INC.

                                By:
                                   ---------------------------------
                                Name: Donald C. Burke
                                Title: Vice President

Attest:



____________________________
Name:   Alice A. Pellegrino
Title:  Secretary


      THE UNDERSIGNED, Vice President of MUNIHOLDINGS FUND, INC. (the
"Corporation"), who executed on behalf of the Corporation the foregoing
Articles Supplementary, of which this certificate is made a part, hereby
acknowledges, in the name and on behalf of the Corporation, the foregoing
Articles Supplementary to be the corporate act of the Corporation and, as to
all matters and facts required to be verified under oath, further certifies
that, to the best of his knowledge, information and belief, these matters and
facts contained herein are true in all material respects and that this
statement is made under the penalties for perjury.





                                By:______________________________________
                                   Name:   Donald C. Burke
                                   Title:  Vice President



                                      85
</TEXT>
</DOCUMENT>
