8-K

               SECURITIES AND EXCHANGE COMMISSION
                                
                     WASHINGTON, D.C.  20549
                                
                            FORM 8-K
                                
                         CURRENT REPORT
                                
             PURSUANT TO SECTION 13 OR 15(D) OF THE
                 SECURITIES EXCHANGE ACT OF 1934



Date of Report:     FEBRUARY 26, 1997

Date of Earliest Event Reported:   FEBRUARY 21, 1997


                        THE ROUSE COMPANY
     (Exact name of registrant as specified in its charter)

MARYLAND                   0-1743               52-0735512
(State or other   (Commission File Number)    (IRS Employer
jurisdiction                                 Indentification
of Incorporation)                                 Number)

10275 LITTLE PATUXENT PARKWAY
COLUMBIA, MARYLAND                              21044-3456
(Address of principal executive offices)        (Zip code)

Registrant's telephone number, including area code: (410) 992-6000

ITEM 5.   OTHER EVENTS.

     In connection with the offering (the "Offering") of Series B
Convertible Preferred Stock, par value $0.01 per share (the
"Series B Preferred Stock"), of The Rouse Company, a Maryland
corporation (the "Company"), the Company is hereby filing as
Exhibit 1 hereto a copy of the Articles Supplementary setting
forth the terms of the Series B Preferred Stock (the "Articles
Supplementary").   The Articles Supplementary are hereby
incorporated by reference into the Registration Statement on Form
S-3 (File No. 333-20781) of the Company, as amended by Amendment
No. 1 thereto (as so amended, the "Registration Statement"),
pursuant to which the Series B Preferred Stock was registered
under the Securities Act of 1933, as amended.  The Registration
Statement was declared effective by the Securities and Exchange
Commission on February 6, 1997.

ITEM 7.   FINANCIAL STATEMENTS AND EXHIBITS.

     1.   The Articles Supplementary to the Charter of The Rouse
          Company relating to the Series B Convertible Preferred
          Stock, par value $0.01 per share, of The Rouse Company.
          
                           SIGNATURES


     Pursuant to the requirements of the Securities Exchange Act
of 1934, the registrant has duly caused this report to be signed
on its behalf by the undersigned hereunto duly authorized.

                             THE ROUSE COMPANY



Febuary 26, 1997             By:   /s/Jeffrey H. Donahue
                                   ---------------------
                                   Jeffrey H. Donahue
                                     Senior Vice President and 
                                     Chief Financial Officer

                            EXHIBITS


Exhibit No.                               Description
- -----------                               -----------

    1                           The Articles Supplementary to
                                the Charter of The Rouse
                                Company relating to the Series
                                B Convertible Preferred Stock,
                                par value $0.01 per share, of
                                The Rouse Company.

EX-1

						Exhibit 1

            ARTICLES SUPPLEMENTARY TO THE CHARTER OF
                       THE ROUSE COMPANY


     The Rouse Company, a Maryland corporation, having its
principal office in Columbia, Maryland (hereinafter called the
"Corporation"), hereby 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 the Articles
of Incorporation, as amended and restated in the Articles of
Amendment and Restatement of the Corporation (the "Charter"), the
Board of Directors has duly divided and classified 4,600,000
shares of the Preferred Stock of the Corporation, par value $.01
per share, into a class designated Series B Convertible Preferred
Stock, and provided for the issuance of such Preferred Stock.

     SECOND:  The terms of the Series B Convertible Preferred
Stock established by the Board of Directors, in addition to those
set forth in Article FIFTH of the Charter of the Corporation
applicable to all classes of Preferred Stock, are as follows:

          Section 1.  Number of Shares and Designation.  This
class of Preferred Stock shall be designated as Series B
Convertible Preferred Stock (the "Series B Preferred Stock") and
4,600,000 shall be the number of shares of Preferred Stock
constituting such class.

          Section 2.  Definitions.  For purposes of the Series B
Preferred Stock, the following terms shall have the meanings
indicated:

             "Act" shall have the meaning set forth in paragraph
        (g) of Section 5 hereof.
        
             "Board of Directors" shall mean the Board of
        Directors of the Corporation or any committee authorized
        by such Board of Directors to perform any of its
        responsibilities with respect to the Series B Preferred
        Stock.
        
             "Business Day" shall mean any day other than a
        Saturday, Sunday or a day on which state or federally
        chartered banking institutions in Columbia, Maryland or
        New York, New York are not required to be open.
        
             "Call Date" shall have the meaning set forth in
        paragraph (c) of Section 5 hereof.
        
             "Common Stock" shall mean the common stock of the
        Corporation, par value $.01 per share.
        
             "Constituent Person" shall have the meaning set
        forth in paragraph (e) of Section 7 hereof.
        
             "Conversion Price" shall mean the conversion price
        per share of Common Stock for which the Series B
        Preferred Stock is convertible, as such Conversion Price
        may be adjusted pursuant to Section 7.  The initial
        conversion price shall be $38.125 (equivalent to a
        conversion rate of 1.311 shares of Common Stock for each
        share of Series B Preferred Stock).
        
             "Current Market Price" of publicly traded shares of
        common stock or any other class of capital stock or
        other security of the Corporation or any other issuer
        for any day shall mean the last reported sales price,
        regular way on such day, or, if no sale takes place on
        such day, the average of the reported closing bid and
        asked prices on such day, regular way, in either case as
        reported on the New York Stock Exchange or, if such
        security is not listed or admitted for trading on the
        New York Stock Exchange ("NYSE"), on the principal
        national securities exchange on which such security is
        listed or admitted for trading or, if not listed or
        admitted for trading on any national securities
        exchange, on the NASDAQ National Market or, if such
        security is not quoted on such NASDAQ National Market,
        the average of the closing bid and asked prices on such
        day in the over-the-counter market as reported by NASDAQ
        or, if bid and asked prices for such security on such
        day shall not have been reported through NASDAQ, the
        average of the bid and asked prices on such day as
        furnished by any NYSE member firm regularly making a
        market in such security selected for such purpose by the
        Chief Executive Officer or the Board of Directors.
        
             "Dividend Payment Date" shall mean the first
        calendar day of January, April, July and October, in
        each year, commencing on April 1, 1997; provided,
        however, that if any Dividend Payment Date falls on any
        day other than a Business Day, the dividend payment due
        on such Dividend Payment Date shall be paid on the
        Business Day immediately following such Dividend Payment
        Date.
        
             "Dividend Periods" shall mean quarterly dividend
        periods commencing on January 1, April 1, July 1 and
        October 1 of each year and ending on and including the
        day preceding the first day of the next succeeding
        Dividend Period (other than the initial Dividend Period,
        which shall commence on the Issue Date and end on and
        include March 31, 1997).
        
             "Fair Market Value" shall mean the average of the
        daily Current Market Prices of a share of Common Stock
        during the five (5) consecutive Trading Days selected by
        the Corporation commencing not more than 20 Trading Days
        before, and ending not later than, the earlier of the
        day in question and the day before the "ex date" with
        respect to the issuance or distribution requiring such
        computation.  The term "ex date" when used with respect
        to any issuance or distribution, means the first day on
        which the Common Stock trades regular way, without the
        right to receive such issuance or distribution, on the
        exchange or in the market, as the case may be, used to
        determine that day's Current Market Price.
        
             "Issue Date" shall mean the first date on which
        shares of Series B Preferred Stock are issued and sold.
        
             "Junior Stock" shall mean the Common Stock, the
        Increasing Rate Cumulative Preferred Stock, par value
        $0.01 per share, the 10.25% Junior Preferred Stock, 1996
        Series, par value $0.01 per share, and any other class
        or series of shares of capital stock of the Corporation
        constituting junior stock within the meaning set forth
        in paragraph (c) of Section 8.
        
             "Non-Electing Share" shall have the meaning set
        forth in paragraph (e) of Section 7 hereof.
        
             "Parity Stock" shall have the meaning set forth in
        paragraph (b) of Section 8.
        
             "Person" shall mean any individual, firm,
        partnership, corporation or other entity, and shall
        include any successor (by merger or otherwise) of such
        entity.
        
             "Press Release" shall have the meaning set forth in
        paragraph (b) of Section 5 hereof.
        
             "Securities" shall have the meaning set forth in
        paragraph (d)(iii) of Section 7 hereof.
        
             "Series B Preferred Stock" shall have the meaning
        set forth in Section 1 hereof.
        
             "set apart for payment" shall be deemed to include,
        without any action other than the following, the
        recording by the Corporation in its accounting ledgers
        of any accounting or bookkeeping entry which indicates,
        pursuant to a declaration of dividends or other
        distribution by the Board of Directors, the allocation
        of funds to be so paid on any series or class of capital
        stock of the Corporation; provided, however, that if any
        funds for any class or series of Junior Stock or any
        class or series of stock ranking on a parity with the
        Series B Preferred Stock as to the payment of dividends
        are placed in a separate account of the Corporation or
        delivered to a disbursing, paying or other similar
        agent, then "set apart for payment" with respect to the
        Series B Preferred Stock shall mean placing such funds
        in a separate account or delivering such funds to a
        disbursing, paying or other similar agent.
        
             "Trading Day" shall mean any day on which the
        securities in question are traded on the NYSE, or if
        such securities are not listed or admitted for trading
        on the NYSE, on the principal national securities
        exchange on which such securities are listed or
        admitted, or if not listed or admitted for trading on
        any national securities exchange, on the NASDAQ National
        Market, or if such securities are not quoted on such
        NASDAQ National Market, in the applicable securities
        market in which the securities are traded.
        
             "Transaction" shall have the meaning set forth in
        paragraph (e) of Section 7 hereof.
        
             "Transfer Agent" means The Bank of New York, New
        York, New York, or such other agent or agents of the
        Corporation as may be designated by the Board of
        Directors or their designee as the transfer agent for
        the Series B Preferred Stock.
        
             "Voting Preferred Shares" shall have the meaning
        set forth in Section 9 hereof.
        
     Section 3.  Dividends.  (a) The holders of shares of the
Series B Preferred Stock shall be entitled to receive, when, as
and if declared by the Board of Directors out of funds legally
available for that purpose, dividends payable in cash at the rate
per annum of $3.00 per share of Series B Preferred Stock.  Such
dividends shall be cumulative from the Issue Date, whether or not
in any Dividend Period or Periods there shall be funds of the
Corporation legally available for the payment of such dividends,
and shall be payable quarterly, when, as and if declared by the
Board of Directors, in arrears on Dividend Payment Dates,
commencing on the first Dividend Payment Date after the Issue
Date.  Each such dividend shall be payable in arrears to the
holders of record of shares of the Series B Preferred Stock, as
they appear on the stock records of the Corporation at the close
of business on such record dates, not more than 60 days preceding
such Dividend Payment Dates thereof, as shall be fixed by the
Board of Directors.  Accrued and unpaid dividends for any past
Dividend Periods may be declared and paid at any time, without
reference to any regular Dividend Payment Date, to holders of
record on such date, not exceeding 45 days preceding the payment
date thereof, as may be fixed by the Board of Directors.

     (b)  The amount of dividends payable for each full Dividend
Period for the Series B Preferred Stock shall be computed by
dividing the annual dividend rate by four.  The amount of
dividends payable for the initial Dividend Period, or any other
period shorter or longer than a full Dividend Period, on the
Series B Preferred Stock shall be computed on the basis of twelve
30-day months and a 360-day year.  Holders of shares of Series B
Preferred Stock shall not be entitled to any dividends, whether
payable in cash, property or stock, in excess of cumulative
dividends, as herein provided, on the Series B Preferred Stock.
No interest, or sum of money in lieu of interest, shall be
payable in respect of any dividend payment or payments on the
Series B Preferred Stock that may be in arrears.

     (c)  So long as any shares of the Series B Preferred Stock
are outstanding, no dividends, except as described in the
immediately following sentence, shall be declared or paid or set
apart for payment on any class or series of Parity Stock for any
period unless full cumulative dividends have been or
contemporaneously are declared and paid or declared and a sum
sufficient for the payment thereof set apart for such payment on
the Series B Preferred Stock for all Dividend Periods terminating
on or prior to the Dividend Payment Date on such class or series
of Parity Stock.  When dividends are not paid in full or a sum
sufficient for such payment is not set apart, as aforesaid, all
dividends declared upon shares of the Series B Preferred Stock
and all dividends declared upon any other class or series of
Parity Stock shall be declared ratably in proportion to the
respective amounts of dividends accumulated and unpaid on the
Series B Preferred Stock and accumulated and unpaid on such
Parity Stock.

     (d)  So long as any shares of the Series B Preferred Stock
are outstanding, no dividends (other than dividends or
distributions paid in shares of, or options, warrants or rights
to subscribe for or purchase shares of, Junior Stock) shall be
declared or paid or set apart for payment or other distribution
declared or made upon Junior Stock, nor shall any Junior Stock be
redeemed, purchased or otherwise acquired (other than (i) a
redemption, purchase or other acquisition of shares of Common
Stock made for purposes of an employee incentive or benefit plan
of the Corporation or any subsidiary or (ii) a purchase or other
acquisition of shares of Common Stock made for purposes of
distribution  pursuant to the Contingent Stock Agreement,
effective as of January 1, 1996 (the "Agreement"), by the
Corporation , in favor of and for the benefit of the Holders and
the Representatives (as such terms are defined in the
Agreement)), for any consideration (or any moneys to be paid to
or made available for a sinking fund for the redemption of any
shares of such stock) by the Corporation, directly of indirectly
(except by conversion into or exchange for Junior Stock), unless
in each case (i) the full cumulative dividends on all outstanding
shares of the Series B Preferred Stock and any other Parity Stock
of the Corporation shall have been paid or set apart for payment
for all past Dividend Periods with respect to the Series B
Preferred Stock and all past dividend periods with respect to
such Parity Stock and (ii) sufficient funds shall have been paid
or set apart for the payment of the dividend for the current
Dividend Period with respect to the Series B Preferred Stock and
the current dividend period with respect to such Parity Stock.

     Section 4.  Liquidation Preference.  (a)  In the event of
any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, before any payment or
distribution of the assets of the Corporation (whether capital or
surplus) shall be made to or set apart for the holders of Junior
Stock, the holders of the shares of Series B Preferred Stock
shall be entitled to receive Fifty Dollars ($50.00) per share of
Series B Preferred Stock plus an amount equal to all dividends
(whether or not earned or declared) accrued and unpaid thereon to
the date of final distribution to such holders; but such holders
shall not be entitled to any further payment.  If, upon any
liquidation, dissolution or winding up of the Corporation, the
assets of the Corporation, or proceeds thereof, distributable
among the holders of the shares of Series B Preferred Stock shall
be insufficient to pay in full the preferential amount aforesaid
and liquidating payments on any other shares of any class or
series of Parity Stock, then such assets, or the proceeds
thereof, shall be distributed among the holders of any shares of
Series B Preferred Stock and any such other Parity Stock ratably
in accordance with the respective amounts that would be payable
on such shares of Series B Preferred Stock and any such other
Parity Stock if all amounts payable thereon were paid in full.
For the purposes of this Section 4, (i) a consolidation or merger
of the Corporation with one or more corporations, (ii) a sale or
transfer of all or substantially all of the Corporation's assets,
or (iii) a statutory share exchange shall not be deemed to be a
liquidation, dissolution or winding up, voluntary or involuntary,
of the Corporation.

     (b)  Subject to the rights of the holders of shares of any
series or class or classes of stock ranking on a parity with or
prior to the Series B Preferred Stock upon liquidation,
dissolution or winding up, upon any liquidation, dissolution or
winding up of the Corporation, after payment shall have been made
in full to the holders of the Series B Preferred Stock, as
provided in this Section 4, any other series or class or classes
of Junior Stock shall, subject to any respective terms and
provisions, applying thereto, be entitled to receive any and all
assets remaining to be paid or distributed, and the holders of
the Series B Preferred Stock shall not be entitled to share
therein.

     Section 5.  Redemption at the Option of the Corporation.
(a)  The Series B Preferred Stock shall not be redeemable by the
Corporation prior to April 1, 2000.  On and after April 1, 2000,
the Corporation, at its option, may redeem the shares of Series B
Preferred Stock, in whole or in part, as set forth herein,
subject to the provisions described below.

     (b)  The Series B Preferred Stock may be redeemed, in whole
or in part, at the option of the Corporation, at any time, only
if for 20 Trading Days within any period of 30 consecutive
Trading Days, including the last Trading Day of such period, the
Current Market Price of the Common Stock on each of such 20
Trading Days exceeds 120% of the Conversion Price in effect on
such Trading Day.  In order to exercise its redemption option,
the Corporation must issue a press release announcing the
redemption (the "Press Release") prior to the opening of business
on the second Trading Day after the condition in the preceding
sentence has, from time to time, been met.  The Corporation may
not issue a Press Release prior to February 1, 2000.  The Press
Release shall announce the redemption and set forth the number of
shares of Series B Preferred Stock which the Corporation intends
to redeem.  The Call Date (which may not be before April 1, 2000)
shall be selected by the Corporation, shall be specified in the
notice of redemption and shall be not less than 30 days or more
than 60 days after the date on which the Corporation issues the
Press Release.

     (c)  Upon redemption of Series B Preferred Stock by the
Corporation on the date specified in the notice to holders
required under paragraph (e) of this Section 5 (the "Call Date"),
each share of Series B Preferred Stock so redeemed shall be
converted into a number of shares of Common Stock equal to the
liquidation preference of the shares of Series B Preferred Stock
being redeemed divided by the Conversion Price as of the opening
of business on the Call Date.

     Upon any redemption of Series B Preferred Stock, the
Corporation shall pay any accrued and unpaid dividends in arrears
for any Dividend Period ending or on prior to the Call Date.  If
the Call Date falls after a dividend payment record date and
prior to the corresponding Dividend Payment Date, then each
holder of Series B Preferred Stock at the close of business on
such dividend payment record date shall be entitled to the
dividend payable on such shares on the corresponding dividend
payment date notwithstanding the redemption of such shares before
such Dividend Payment Date.  Except as provided above, the
Corporation shall make no payment or allowance for unpaid
dividends, whether or not in arrears, on shares of Series B
Preferred Stock called for redemption or on the shares of Common
Stock issued upon such redemption.

     (d)  If full cumulative dividends on the Series B Preferred
Stock and any other class or series of Parity Stock of the
Corporation have not been paid or declared and set apart for
payment, the Series B Preferred Stock may not be redeemed in part
and the Corporation may not purchase or acquire shares of Series
B Preferred Stock, otherwise than pursuant to a purchase or
exchange offer made on the same terms to all holders of shares of
Series B Preferred Stock.

     (e)  If the Corporation shall redeem shares of Series B
Preferred Stock pursuant to paragraph (a) of this Section 5,
notice of such redemption shall be given not more than four
Business Days after the date on which the Corporation issues the
Press Release to each holder of record of the shares to be
redeemed.  Such notice shall be provided by first class mail,
postage prepaid, at such holder's address as the same appears on
the stock records of the Corporation, or by publication in The
Wall Street Journal or The New York Times, or if neither such
newspaper is then being published, any other daily newspaper of
national circulation.  If the Corporation elects to provide such
notice by publication, it shall also promptly mail notice of such
redemption to the holders of the Series B Preferred Stock to be
redeemed.  Neither the failure to mail any notice required by
this paragraph (e), nor any defect therein or in the mailing
thereof, to any particular holder, shall affect the sufficiency
of the notice or the validity of the proceedings for redemption
with respect to the other holders.  Any notice which was mailed
in the manner herein provided shall be conclusively presumed to
have been duly given on the date mailed whether or not the holder
receives the notice.  Each such mailed or published notice shall
state, as appropriate:  (1) the Call Date; (2) the number of
shares of Series B Preferred Stock to be redeemed and, if fewer
than all the shares held by such holder are to be redeemed, the
number of such shares to be redeemed from such holder; (3) the
number of shares of Common Stock to be issued with respect to
each share of Series B Preferred Stock; (4) the place or places
at which certificates for such shares are to be surrendered for
certificates representing shares of Common Stock; (5) the then-
current Conversion Price; and (6) that dividends on the shares to
be redeemed shall cease to accrue on such Call Date except as
otherwise provided herein.  Notice having been published or
mailed as aforesaid, from and after the Call Date (unless the
Corporation shall fail to make available a number of shares of
Common Stock or amount of cash necessary to effect such
redemption), (i) except as otherwise provided herein, dividends
on the shares of the Series B Preferred Stock so called for
redemption shall cease to accrue, (ii) said shares shall no
longer be deemed to be outstanding, and (iii) all rights of the
holders thereof as holders of Series B Preferred Stock of the
Corporation shall cease (except the rights to receive the shares
of Common Stock and cash payable upon such redemption, without
interest thereon, upon surrender and endorsement of their
certificates if so required and to receive any dividends payable
thereon).  The Corporation's obligation to provide shares of
Common Stock and cash in accordance with the preceding sentence
shall be deemed fulfilled if, on or before the Call Date, the
Corporation shall deposit with a bank or trust company (which may
be an affiliate of the Corporation) that has an office in the
Borough of Manhattan, City of New York, or in Baltimore, Maryland
and that has, or is an affiliate of a bank or trust company that
has, a capital and surplus of at least $50,000,000, shares of
Common Stock and any cash necessary for such redemption, in
trust, with irrevocable instructions that such shares of Common
Stock and cash be applied to the redemption of the shares of
Series B Preferred Stock so called for redemption. At the close
of business on the Call Date, each holder of Series B Preferred
Stock to be redeemed (unless the Company defaults in the delivery
of the shares of Common Stock or cash payable on such Call Date)
shall be deemed to be the record holder of the number of shares
of Common Stock into which such Series B Preferred Stock is to be
redeemed, regardless of whether such holder has surrendered the
certificates representing the Series B Preferred Stock.  No
interest shall accrue for the benefit of the holder of Series B
Preferred Stock to be redeemed on any cash so set aside by the
Corporation.  Subject to applicable escheat laws, any such cash
unclaimed at the end of two years from the Call Date shall revert
to the general funds of the Corporation, after which reversion
the holders of such shares so called for redemption shall look
only to the general funds of the Corporation for the payment of
such cash.

     As promptly as practicable after the surrender in accordance
with said notice of the certificates for any such shares so
redeemed (properly endorsed or assigned for transfer, if the
Corporation shall so require and if the notice shall so state),
such shares shall be exchanged for certificates of shares of
Common Stock and any cash (without interest thereon) for which
such shares have been redeemed.  If fewer than all the
outstanding shares of Series B Preferred Stock are to be
redeemed, shares to be redeemed shall be selected by the
Corporation from outstanding shares of the Series B Preferred
Stock not previously called for redemption by lot or pro rata (as
nearly as may be) or by any other method determined by the
Corporation in its sole discretion to be equitable.  If fewer
than all the shares of Series B Preferred Stock represented by
any certificate are redeemed, then new certificates representing
the unredeemed shares shall be issued without cost to the holder
thereof.

     (f)  No fractional shares or scrip representing fractions of
shares of Common Stock shall be issued upon redemption of the
Series B Preferred Stock.  Instead of any fractional interest in
a share of Common Stock that would otherwise be deliverable upon
the redemption of a share of Series B Preferred Stock, the
Corporation shall pay to the holder of such share an amount in
cash (computed to the nearest cent) based upon the Current Market
Price of Common Stock on the Trading Day immediately preceding
the Call Date.  If more than one share shall be surrendered for
redemption at one time by the same holder, the number of full
shares of Common Stock issuable upon redemption thereof shall be
computed on the basis of the aggregate number of shares of Series
B Preferred Stock so surrendered.

     (g)  The Corporation covenants that any shares of Common
Stock issued upon redemption of the Series B Preferred Stock
shall be validly issued, fully paid and non-assessable.  The
Corporation shall endeavor to list the shares of Common Stock
required to be delivered upon redemption of the Series B
Preferred Stock, prior to such redemption, upon each national
securities exchange, if any, upon which the outstanding Common
Stock is listed at the time of such delivery.

     The Corporation shall endeavor to take any action necessary
to ensure that any shares of Common Stock issued upon the
redemption of Series B Preferred Stock are freely transferable
and not subject to any resale restrictions under the Securities
Act of 1933, as amended (the "Act"), or any applicable state
securities or blue sky laws (other than any shares of Common
Stock issued upon redemption of any Series B Preferred Stock
which are held by an "affiliate" (as defined in Rule 144 under
the Act) of the Corporation).

     Section 6.  Shares to Be Retired.

     All shares of Series B Preferred Stock which shall have been
issued and reacquired in any manner by the Corporation shall be
restored to the status of authorized but unissued shares of
Preferred Stock, without designation as to series.

     Section 7.  Conversion.

     Holders of shares of Series B Preferred Stock shall have the
right to convert all or a portion of such shares into shares of
Common Stock, as follows:

     (a)  Subject to and upon compliance with the provisions of
this Section 7, a holder of shares of Series B Preferred Stock
shall have the right, at his or her option, at any time to
convert such shares into the number of fully paid and non-
assessable shares of Common Stock obtained by dividing the
aggregate liquidation preference of such shares by the Conversion
Price (as in effect at the time and on the date provided for in
the last paragraph of paragraph (b) of this Section 7) by
surrendering such shares to be converted, such surrender to be
made in the manner provided in paragraph (b) of this Section 7;
provided, however, that the right to convert shares called for
redemption pursuant to Section 5 shall terminate at the close of
business on the Call Date fixed for such redemption, unless the
Corporation shall default in making payment of the shares of
Common Stock and any cash payable upon such redemption under
Section 5 hereof.

     (b)  In order to exercise the conversion right, the holder
of each share of Series B Preferred Stock to be converted shall
surrender the certificate representing such share, duly endorsed
or assigned to the Corporation or in blank, at the office of the
Transfer Agent, accompanied by written notice to the Corporation
that the holder thereof elects to convert such Series B Preferred
Stock.  Unless the shares issuable on conversion are to be issued
in the same name as the name in which such share of Series B
Preferred Stock is registered, each share surrendered for
conversion shall be accompanied by instruments of transfer, in
form satisfactory to the Corporation, duly executed by the holder
or such holder's duly authorized attorney and an amount
sufficient to pay any transfer or similar tax (or evidence
reasonably satisfactory to the Corporation demonstrating that
such taxes have been paid).

     Holders of shares of Series B Preferred Stock at the close
of business on a dividend payment record date shall be entitled
to receive the dividend payable on such shares on the
corresponding Dividend Payment Date notwithstanding the
conversion thereof following such dividend payment record date
and prior to such Dividend Payment Date.  However, shares of
Series B Preferred Stock surrendered for conversion during the
period between the close of business on any dividend payment
record date and the opening of business on the corresponding
Dividend Payment Date (except shares converted after the issuance
of notice of redemption with respect to a Call Date during such
period or coinciding with such Dividend Payment Date, such shares
of Series B Preferred Stock being entitled to such dividend on
the Dividend Payment Date) must be accompanied by payment of an
amount equal to the dividend payable on such shares on such
Dividend Payment Date.  A holder of shares of Series B Preferred
Stock on a dividend payment record date who (or whose
transferees) tenders any such shares for conversion into shares
of Common Stock on such Dividend Payment Date will receive the
dividend payable by the Corporation on such shares of Series B
Preferred Stock on such date, and the converting holder need not
include payment of the amount of such dividend upon surrender of
shares of Series B Preferred Stock for conversion.  Except as
provided above, the Corporation shall make no payment or
allowance for unpaid dividends, whether or not in arrears, on
converted shares or for dividends on the shares of Common Stock
issued upon such conversion.

     As promptly as practicable after the surrender of
certificates for shares of Series B Preferred Stock as aforesaid,
the Corporation shall issue and shall deliver at such office to
such holder, or on his or her written order, a certificate or
certificates for the number of full shares of Common Stock
issuable upon the conversion of such shares in accordance with
the provisions of this Section 7, and any fractional interest in
respect of a share of Common Stock arising upon such conversion
shall be settled as provided in paragraph (c) of this Section 7.

     Each conversion shall be deemed to have been effected
immediately prior to the close of business on the date on which
the certificates for shares of Series B Preferred Stock shall
have been surrendered and such notice (and if applicable, payment
of an amount equal to the dividend payable on such shares)
received by the Corporation as aforesaid, and the person or
persons in whose name or names any certificate or certificates
for shares of Common Stock shall be issuable upon such conversion
shall be deemed to have become the holder or holders of record of
the shares represented thereby at such time on such date, and
such conversion shall be at the Conversion Price in effect at
such time and on such date unless the stock transfer books of the
Corporation shall be closed on that date, in which event such
person or persons shall be deemed to have become such holder or
holders of record at the close of business on the next succeeding
day on which such stock transfer books are open, but such
conversion shall be at the Conversion Price in effect on the date
on which such shares shall have been surrendered and such notice
received by the Corporation.

     (c)  No fractional shares or scrip representing fractions of
shares of Common Stock shall be issued upon conversion of the
Series B Preferred Stock.  Instead of any fractional interest in
a share of Common Stock that would otherwise be deliverable upon
the conversion of a share of Series B Preferred Stock, the
Corporation shall pay to the holder of such share an amount in
cash based upon the Current Market Price of Common Stock on the
Trading Day immediately preceding the date of conversion.  If
more than one share shall be surrendered for conversion at one
time by the same holder, the number of full shares of Common
Stock issuable upon conversion thereof shall be computed on the
basis of the aggregate number of shares of Series B Preferred
Stock so surrendered.

     (d)  The Conversion Price shall be adjusted from time to
time as follows:

          (i)  If the Corporation shall after the Issue Date (A)
     pay a dividend or make a distribution on its capital stock
     in shares of its Common Stock, (B) subdivide its outstanding
     Common Stock into a greater number of shares, (C) combine
     its outstanding Common Stock into a smaller number of shares
     or (D) issue any shares of capital stock by reclassification
     of its Common Stock, the Conversion Price in effect at the
     opening of business on the day following the date fixed for
     the determination of stockholders entitled to receive such
     dividend or distribution or at the opening of business on
     the day following the day on which such subdivision,
     combination or reclassification becomes effective, as the
     case may be, shall be adjusted so that the holder of any
     share of Series B Preferred Stock thereafter surrendered for
     conversion shall be entitled to receive the number of shares
     of Common Stock that such holder would have owned or have
     been entitled to receive after the happening of any of the
     events described above had such shares been converted
     immediately prior to the record date in the case of a
     dividend or distribution or the effective date in the case
     of a subdivision, combination or reclassification.  An
     adjustment made pursuant to this subparagraph (i) shall
     become effective immediately after the opening of business
     on the day next following the record date (except as
     provided in paragraph (h) below) in the case of a dividend
     or distribution and shall become effective immediately after
     the opening of business on the day next following the
     effective date in the case of a subdivision, combination or
     reclassification.
     
          (ii) If the Corporation shall issue after the Issue
     Date rights, options or warrants to all holders of Common
     Stock entitling them (for a period expiring within 45 days
     after the record date mentioned below) to subscribe for or
     purchase Common Stock at a price per share less than the
     Fair Market Value per share of Common Stock on the record
     date for the determination of stockholders entitled to
     receive such rights, options or warrants, then the
     Conversion Price in effect at the opening of business on the
     day next following such record date shall be adjusted to
     equal the price determined by multiplying (I) the Conversion
     Price in effect immediately prior to the opening of business
     on the day following the date fixed for such determination
     by (II) a fraction, the numerator of which shall be the sum
     of (A) the number of shares of Common Stock outstanding on
     the close of business on the date fixed for such
     determination and (B) the number of shares that the
     aggregate proceeds to the Corporation from the exercise of
     such rights, options or warrants for Common Stock would
     purchase at such Fair Market Value, and the denominator of
     which shall be the sum of (A) the number of shares of Common
     Stock outstanding on the close of business on the date fixed
     for such determination and (B) the number of additional
     shares of Common Stock offered for subscription or purchase
     pursuant to such rights, options or warrants.  Such
     adjustment shall become effective immediately after the
     opening of business on the day next following such record
     date (except as provided in paragraph (h) below).  In
     determining whether any rights, options or warrants entitle
     the holders of Common Stock to subscribe for or purchase
     shares of Common Stock at less than such Fair Market Value,
     there shall be taken into account any consideration received
     by the Corporation upon issuance and upon exercise of such
     rights, options or warrants, the value of such
     consideration, if other than cash, to be determined by the
     Chief Executive Officer or the Board of Directors.
     
          (iii) If the Corporation shall distribute to all
     holders of its Common Stock any shares of capital stock of
     the Corporation (other than Common Stock) or evidence of its
     indebtedness or assets (excluding cash dividends or
     distributions paid out of the total equity applicable to
     Common Stock, including revaluation equity, less the amount
     of stated capital attributable to Common Stock, determined
     on the basis of the most recent annual consolidated cost
     basis and current value basis and quarterly consolidated
     balance sheets of the Corporation and its consolidated
     subsidiaries available at the time of the declaration of the
     dividend or distribution) or rights or warrants to subscribe
     for or purchase any of its securities (excluding those
     rights and warrants issued to all holders of Common Stock
     entitling them for a period expiring within 45 days after
     the record date referred to in subparagraph (ii) above to
     subscribe for or purchase Common Stock, which rights and
     warrants are referred to in and treated under subparagraph
     (ii) above) (any of the foregoing being hereinafter in this
     subparagraph (iii) called the "Securities"), then in each
     case the Conversion Price shall be adjusted so that it shall
     equal the price determined by multiplying (I) the Conversion
     Price in effect immediately prior to the close of business
     on the date fixed for the determination of stockholders
     entitled to receive such distribution by (II) a fraction,
     the numerator of which shall be the Fair Market Value per
     share of the Common Stock on the record date mentioned below
     less the then fair market value (as determined by the Chief
     Executive Officer or the Board of Directors, whose
     determination shall be conclusive) of the portion of the
     capital stock or assets or evidences of indebtedness so
     distributed or of such rights or warrants applicable to one
     share of Common Stock, and the denominator of which shall be
     the Fair Market Value per share of the Common Stock on the
     record date mentioned below.  Such adjustment shall become
     effective immediately at the opening of business on the
     Business Day next following (except as provided in paragraph
     (h) below) the record date for the determination of
     shareholders entitled to receive such distribution.  For the
     purposes of this subparagraph (iii), the distribution of a
     Security, which is distributed not only to the holders of
     the Common Stock on the date fixed for the determination of
     stockholders entitled to such distribution of such Security,
     but also is distributed with each share of Common Stock
     delivered to a Person converting a share of Series B
     Preferred Stock after such determination date, shall not
     require an adjustment of the Conversion Price pursuant to
     this subparagraph (iii); provided that on the date, if any,
     on which a person converting a share of Series B Preferred
     Stock would no longer be entitled to receive such Security
     with a share of Common Stock (other than as a result of the
     termination of all such Securities), a distribution of such
     Securities shall be deemed to have occurred, and the
     Conversion Price shall be adjusted as provided in this
     subparagraph (iii) (and such day shall be deemed to be "the
     date fixed for the determination of the stockholders
     entitled to receive such distribution" and "the record date"
     within the meaning of the two preceding sentences).
     
          (iv) No adjustment in the Conversion Price shall be
     required unless such adjustment would require a cumulative
     increase or decrease of at least 1% in such price; provided,
     however, that any adjustments that by reason of this
     subparagraph (iv) are not required to be made shall be
     carried forward and taken into account in any subsequent
     adjustment until made; and provided, further, that any
     adjustment shall be required and made in accordance with the
     provisions of this Section 7 (other than this subparagraph
     (iv)) not later than such time as may be required in order
     to preserve the tax-free nature of a distribution to the
     holders of shares of Common Stock.  Notwithstanding any
     other provisions of this Section 7, the Corporation shall
     not be required to make any adjustment of the Conversion
     Price for the issuance of any shares of Common Stock
     pursuant to any plan providing for the reinvestment of
     dividends or interest payable on securities of the
     Corporation and the investment of additional optional
     amounts in shares of Common Stock under such plan.  All
     calculations under this Section 7 shall be made to the
     nearest cent with ($.005 being rounded upward) or to the
     nearest one-tenth of a share (with .05 of a share being
     rounded upward), as the case may be.  Anything in this
     paragraph (d) to the contrary notwithstanding, the
     Corporation shall be entitled, to the extent permitted by
     law, to make such reductions in the Conversion Price, in
     addition to those required by this paragraph (d), as it in
     its discretion shall determine to be advisable in order that
     any stock dividends, subdivision of shares, reclassification
     or combination of shares, distribution of rights, options or
     warrants to purchase stock or securities, or a distribution
     of other assets (other than cash dividends) hereafter made
     by the Corporation to its stockholders shall not be taxable.
     
     (e)  If the Corporation shall be a party to any transaction
(including without limitation a merger, consolidation, statutory
share exchange, self tender offer for all or substantially all
shares of Common Stock, sale of all or substantially all of the
Corporation's assets or recapitalization of the Common Stock and
excluding any transaction as to which subparagraph (d)(i) of this
Section 7 applies) (each of the foregoing being referred to
herein as a "Transaction"), in each case as a result of which
shares of Common Stock shall be converted into the right to
receive stock, securities or other property (including cash or
any combination thereof), each share of Series B Preferred Stock
which is not converted into the right to receive stock,
securities or other property in connection with such Transaction
shall thereafter be convertible into the kind and amount of
shares of stock, securities and other property (including cash or
any combination thereof) receivable upon the consummation of such
Transaction by a holder of that number of shares of Common Stock
into which one share of Series B Preferred Stock was convertible
immediately prior to such Transaction, assuming such holder of
Common Stock (i) is not a Person with which the Corporation
consolidated or into which the Corporation merged or which merged
into the Corporation or to which such sale or transfer was made,
as the case may be (a "Constituent Person"), or an affiliate of a
Constituent Person and (ii) failed to exercise his or her rights
of the election, if any, as to the kind or amount of stock,
securities and other property (including cash) receivable upon
such Transaction (provided that if the kind or amount of stock,
securities and other property (including cash) receivable upon
such Transaction is not the same for each share of Common Stock
of the Corporation held immediately prior to such Transaction by
other than a Constituent Person or an affiliate thereof and in
respect of which such rights of election shall not have been
exercised ("Non-Electing Share"), then for the purpose of this
paragraph (e) the kind and amount of stock, securities and other
property (including cash) receivable upon such Transaction by
each Non-Electing Share shall be deemed to be the kind and amount
so receivable per share by a plurality of the non-electing
shares).  The Corporation shall not be a party to any Transaction
unless the terms of such Transaction are consistent with the
provisions of this paragraph (e), and it shall not consent or
agree to the occurrence of any Transaction until the Corporation
has entered into an agreement with the successor or purchasing
entity, as the case may be, for the benefit of the holders of the
Series B Preferred Stock that will contain provisions enabling
the holders of the Series B Preferred Stock that remains
outstanding after such Transaction to convert into the
consideration received by holders of Common Stock at the
Conversion Price in effect immediately prior to such Transaction.
The provisions of this paragraph (e) shall similarly apply to
successive Transactions.

     (f)  If:

          (i)   the Corporation shall declare a dividend (or any
     other distribution) on the Common Stock (other than in cash
     out of the total equity applicable to Common Stock,
     including revaluation equity, less the amount of stated
     capital attributable to Common Stock, determined on the
     basis of the most recent annual consolidated cost basis and
     current value basis and quarterly consolidated balance
     sheets of the Corporation and its consolidated subsidiaries
     available at the time of the declaration of the dividend or
     distribution); or
     
          (ii)  the Corporation shall authorize the granting to
     the holders of the Common Stock of rights or warrants to
     subscribe for or purchase any shares of any class or any
     other rights or warrants; or
     
          (iii) there shall be any reclassification of the
     Common Stock (other than an event to which subparagraph 
     (d)(i) of this Section 7 applies) or any consolidation or
     merger to which the Corporation is a party and for which
     approval of any stockholders of the Corporation is required,
     or a statutory share exchange involving the conversion or
     exchange of Common Stock into securities or other property,
     or a self tender offer by the Company for all or
     substantially all of its outstanding shares of Common Stock,
     or the sale or transfer of all or substantially all of the
     assets of the Corporation as an entirety and for which
     approval of any stockholder of the Corporation is required;
     or
     
          (iv)  there shall occur the voluntary or involuntary
     liquidation, dissolution or winding up of the Corporation,
     
then the Corporation shall cause to be filed with the Transfer
Agent and shall cause to be mailed to the holders of shares of
the Series B Preferred Stock at their addresses as shown on the
stock records of the Corporation, as promptly as possible, but at
least 15 days prior to the applicable date hereinafter specified,
a notice stating (A) the date on which a record is to be taken
for the purpose of such dividend, distribution or rights or
warrants, or, if a record is not to be taken, the date as of
which the holders of Common Stock of record to be entitled to
such dividend, distribution or rights or warrants are to be
determined or (B) the date on which such reclassification,
consolidation, merger, statutory share exchange, sale, transfer,
liquidation, dissolution or winding up is expected to become
effective, and the date as of which it is expected that holders
of Common Stock of record shall be entitled to exchange their
shares of Common Stock for securities or other property, if any,
deliverable upon such reclassification, consolidation, merger,
statutory share exchange, sale, transfer, liquidation,
dissolution or winding up.  Failure to give or receive such
notice or any defect therein shall not affect the legality or
validity of the proceedings described in this Section 7.

     (g)  Whenever the Conversion Price is adjusted as herein
provided, the Corporation shall promptly file with the Transfer
Agent an officer's certificate setting forth the Conversion Price
after such adjustment and setting forth a brief statement of the
facts requiring such adjustment, which certificate shall be
conclusive evidence of the correctness of such adjustment absent
manifest error.  Promptly after delivery of such certificate, the
Corporation shall prepare a notice of such adjustment of the
Conversion Price setting forth the adjusted Conversion Price and
the effective date of such adjustment becomes effective and shall
mail such notice of such adjustment of the Conversion Price to
the holder of each share of Series B Preferred Stock at such
holder's last address as shown on the stock records of the
Corporation.

     (h)  In any case in which paragraph (d) of this Section 7
provides that an adjustment shall become effective on the day
next following the record date for an event, the Corporation may
defer until the occurrence of such event (A) issuing to the
holder of any share of Series B Preferred Stock converted after
such record date and before the occurrence of such event the
additional shares of Common Stock issuable upon such conversion
by reason of the adjustment required by such event over and above
the Common Stock issuable upon such conversion before giving
effect to such adjustment and (B) paying to such holder any
amount of cash in lieu of any fraction pursuant to paragraph (c)
of this Section 7.

     (i)  There shall be no adjustment of the Conversion Price in
case of the issuance of any stock of the Corporation in a
reorganization, acquisition or other similar transaction except
as specifically set forth in this Section 7.  If any action or
transaction would require adjustment of the Conversion Price
pursuant to more than one paragraph of this Section 7, only one
adjustment shall be made, and such adjustment shall be the amount
of adjustment that has the highest absolute value.

     (j)  If the Corporation shall take any action affecting the
Common Stock, other than action described in this Section 7, that
in the opinion of the Board of Directors would materially
adversely affect the conversion rights of the holders of the
shares of Series B Preferred Stock, the Conversion Price for the
Series B Preferred Stock may be adjusted, to the extent permitted
by law, in such manner, if any, and at such time, as the Board of
Directors, in its sole discretion, may determine to be equitable
in the circumstances.

     (k)  The Corporation covenants that it will at all times
reserve and keep available, free from preemptive rights, out of
the aggregate of its authorized but unissued shares of Common
Stock, for the purpose of effecting conversion of the Series B
Preferred Stock, the full number of shares of Common Stock
deliverable upon the conversion of all outstanding shares of
Series B Preferred Stock not theretofore converted.  For purposes
of this paragraph (k), the number of shares of Common Stock that
shall be deliverable upon the conversion of all outstanding
shares of Series B Preferred Stock shall be computed as if at the
time of computation all such outstanding shares were held by a
single holder.

     The Corporation covenants that any shares of Common Stock
issued upon conversion of the Series B Preferred Stock shall be
validly issued, fully paid and non-assessable.  Before taking any
action that would cause an adjustment reducing the Conversion
Price below the then-par value of the shares of Common Stock
deliverable upon conversion of the Series B Preferred Stock, the
Corporation will take any corporate action that, in the opinion
of its counsel, may be necessary in order that the Corporation
may validly and legally issue fully paid and non-assessable
shares of Common Stock at such adjusted Conversion Price.

     The Corporation shall endeavor to list the shares of Common
Stock required to be delivered upon conversion of the Series B
Preferred Stock, prior to such delivery, upon each national
securities exchange, if any, upon which the outstanding Common
Stock is listed at the time of such delivery.

     Prior to the delivery of any securities that the Corporation
shall be obligated to deliver upon conversion of the Series B
Preferred Stock, the Corporation shall endeavor to comply with
all federal and state laws and regulations thereunder requiring
the registration of such securities with, or any approval of or
consent to the delivery thereof by any governmental authority.

     (1)  The Corporation will pay any and all documentary stamp
or similar issue or transfer taxes payable in respect of the
issue or delivery of shares of Common Stock or other securities
or property on conversion of the Series B Preferred Stock
pursuant hereto; provided, however, that the Corporation shall
not be required to pay any tax that may be payable in respect of
any transfer involved in the issue or delivery of shares of
Common Stock or other securities or property in a name other than
that of the holder of the Series B Preferred Stock to be
converted, and no such issue or delivery shall be made unless and
until the person requesting such issue or delivery has paid to
the Corporation the amount of any such tax or established, to the
reasonable satisfaction of the Corporation, that such tax has
been paid.

     Section 8.  Ranking.  Any class or series of stock of the
Corporation shall be deemed to rank:

          (a)  prior to the Series B Preferred Stock, as to the
     payment of dividends and as to distribution of assets upon
     liquidation, dissolution or winding up, if the holders of
     such class or series shall be entitled to the receipt of
     dividends or of amounts distributable upon liquidation,
     dissolution or winding up, as the case may be, in preference
     or priority to the holders of Series B Preferred Stock;
     
          (b)  on a parity with the Series B Preferred Stock, as
     to the payment of dividends and as to the distribution of
     assets upon liquidation, dissolution or winding up, whether
     or not the dividend rates, dividend payment dates or
     redemption or liquidation prices per share thereof be
     different from those of the Series B Preferred Stock, if the
     holders of such class of stock or series and the Series B
     Preferred Stock shall be entitled to the receipt of
     dividends and of amounts distributable upon liquidation,
     dissolution or winding up in proportion to their respective
     amounts of accrued and unpaid dividends per share or
     liquidation preferences, without preference or priority one
     over the other ("Parity Stock"); and
     
          (c)  junior to the Series B Preferred Stock, as to the
     payment of dividends or as to the distribution of assets
     upon liquidation, dissolution or winding up, if such stock
     or series shall be Common Stock, Increasing Rate Cumulative
     Preferred Stock, par value $0.01 per share, or 10.25% Junior
     Preferred Stock, 1996 Series, par value $0.01 per share, or
     if the holders of Series B Preferred Stock shall be entitled
     to receipt of dividends or of amounts distributable upon
     liquidation, dissolution or winding up, as the case may be,
     in preference or priority to the holders of shares of such
     stock or series.
     
     Section 9.  Voting.  If and whenever six quarterly dividends
(whether or not consecutive) payable on the Series B Preferred
Stock or any series or class of Parity Stock shall be in arrears
(which shall, with respect to any such quarterly dividend, mean
that any such dividend has not been paid in full), whether or not
earned or declared, the number of directors then constituting the
Board of Directors shall be increased by two and the holders of
shares of Series B Preferred Stock, together with the holders of
shares of every other series of Parity Stock (any such other
series, the "Voting Preferred Shares"), voting as a single class
regardless of series, shall be entitled to elect the two
additional directors to serve on the Board of Directors at any
annual meeting of stockholders or special meeting held in place
thereof, or at a special meeting of the holders of the Series B
Preferred Stock and the Voting Preferred Shares called as
hereinafter provided.  Whenever all arrears in dividends on the
Series B Preferred Stock and the Voting Preferred Shares then
outstanding shall have been paid and dividends thereon for the
current quarterly dividend period shall have been paid or
declared and set apart for payment, then the right of the holders
of the Series B Preferred Stock and the Voting Preferred Shares
to elect such additional two directors shall cease (but subject
always to the same provision for the vesting of such voting
rights in the case of any similar future arrearages in six
quarterly dividends), and the terms of office of all persons
elected as directors by the holders of the Series B Preferred
Stock and the Voting Preferred Shares shall forthwith terminate
and the number of the Board of Directors shall be reduced
accordingly.  At any time after such voting power shall have been
so vested in the holders of shares of Series B Preferred Stock
and the Voting Preferred Shares, the secretary of the Corporation
may, and upon the written request of any holder of Series B
Preferred Stock (addressed to the secretary at the principal
office of the Corporation) shall, call a special meeting of the
holders of the Series B Preferred Stock and of the Voting
Preferred Shares for the election of the two directors to be
elected by them as herein provided, such call to be made by
notice similar to that provided in the Bylaws of the Corporation
for a special meeting of the stockholders or as required by law.
If any such special meeting required to be called as above
provided shall not be called by the secretary within 20 days
after receipt of such request, then any holder of shares of
Series B Preferred Stock may call such meeting, upon the notice
above provided, and for that purpose shall have access to the
stock books of the Corporation.  The directors elected at any
such special meeting shall hold office until the next annual
meeting of the stockholders or special meting held in lieu
thereof if such office shall not have previously terminated as
above provided.  If any vacancy shall occur among the directors
elected by the holders of the Series B Preferred Stock and the
Voting Preferred Shares, a successor shall be elected by the
Board of Directors, upon the nomination of the then-remaining
director elected by the holders of the Series B Preferred Stock
and the Voting Preferred Shares or the successor of such
remaining director, to serve until the next annual meeting of the
stockholders or special meeting held in place thereof if such
office shall not have previously terminated as provided above.

     So long as any shares of Series B Preferred Stock are
outstanding, in addition to any other vote or consent of
stockholders required by law or by the Charter, as amended, the
affirmative vote of at least 66-2/3% of the votes entitled to be
cast by the holders of the shares of Series B Preferred Stock and
the Voting Preferred Shares, at the time outstanding, voting as a
single class regardless of series, given in person or by proxy,
either in writing without a meeting or by vote at any meeting
called for the purpose, shall be necessary for effecting or
validating:

          (a)  Any amendment, alteration or repeal of any of the
     provisions of the Charter or these Articles Supplementary
     that materially adversely affects the voting powers, rights
     or preferences of the holders of the Series B Preferred
     Stock or the Voting Preferred Shares; provided, however,
     that the amendment of the provisions of the Charter so as to
     authorize or create or to increase the authorized amount of,
     any Junior Stock or any shares of any class ranking on a
     parity with the Series B Preferred Stock or the Voting
     Preferred Shares shall not be deemed to materially adversely
     affect the voting powers, rights or preferences of the
     holders of Series B Preferred Stock, and provided further,
     that if any such amendment, alteration or repeal would
     materially adversely affect any voting powers, rights or
     preferences of the Series B Preferred Stock or another
     series of Voting Preferred Shares that are not enjoyed by
     some or all of the other series otherwise entitled to vote
     in accordance herewith, the affirmative vote of at least 66-
     2/3% of the votes entitled to be cast by the holders of all
     series similarly affected, similarly given, shall be
     required in lieu of the affirmative vote of at least 66-2/3%
     of the votes entitled to be cast by the holders of the
     shares of Series B Preferred Stock and the Voting Preferred
     Shares otherwise entitled to vote in accordance herewith; or
     
          (b)  The authorization or creation of, or the increase
     in the authorized amount of, any shares of any class or any
     security convertible into shares of any class ranking prior
     to the Series B Preferred Stock in the distribution of
     assets on any liquidation, dissolution or winding up of the
     Corporation or in the payment of dividends;
     
provided, however, that no such vote of the holders of Series B
Preferred Stock shall be required if, at or prior to the time
when such amendment, alteration or repeal is to take effect, or
when the issuance of any such prior shares or convertible
security is to be made, as the case may be, provision is made for
the redemption of all shares of Series B Preferred Stock at the
time outstanding.

     For purposes of the foregoing provisions of this Section 9,
each share of Series B Preferred Stock shall have one (1) vote
per share, except that when any other series of preferred stock
shall have the right to vote with the Series B Preferred Stock as
a single class on any matter, then the Series B Preferred Stock
and such other series shall have with respect to such matters one
(1) vote per $50.00 of stated liquidation preference.  Except as
otherwise required by applicable law or as set forth herein, the
shares of Series B Preferred Stock shall not have any relative,
participating, optional or other special voting rights and powers
other than as set forth herein, and the consent of the holders
thereof shall not be required for the taking of any corporate
action.

     Section 10.  Record Holders.  The Corporation and the
Transfer Agent may deem and treat the record holder of any shares
of Series B Preferred Stock as the true and lawful owner thereof
for all purposes, and neither the Corporation nor the Transfer
Agent shall be affected by any notice to the contrary.

     IN WITNESS WHEREOF, the Corporation has caused these
Articles Supplementary to be made under the seal of the
Corporation and signed in its name and attested by its duly
authorized officers this 21st day of February, 1997.


THE ROUSE COMPANY
                                   
                                   
                                   
                                   By: /s/ Anthony W. Deering
                                      ---------------------------
                                        Anthony W. Deering
                                        President and Chief
                                        Executive Officer



/s/ Bruce I. Rothschild
- -----------------------------------
Bruce I. Rothschild
Vice President, General
Counsel and Secretary


     THE UNDERSIGNED, President and Chief Executive Officer of
The Rouse Company, who executed on behalf of the Corporation
Articles Supplementary of which this Certificate is made a part,
acknowledges in the name and on behalf of said Corporation the
foregoing Articles Supplementary to be the corporate act of said
Corporation and certifies that the matters and facts set forth
herein with respect to the authorization and approval thereof are
true in all material respects under the penalties of perjury.




                                   By: /s/ Anthony W. Deering
                                      ---------------------------
                                        Anthony W. Deering
                                        President and Chief
                                        Executive Officer