BLACKROCK MUNIYIELD CALIFORNIA FUND,
INC.
ARTICLES
OF AMENDMENT
AMENDING AND
RESTATING THE ARTICLES SUPPLEMENTARY
ESTABLISHING
AND FIXING THE
RIGHTS AND PREFERENCES OF
VARIABLE RATE DEMAND PREFERRED SHARES
Table of Contents
EXPLANATORY STATEMENT...................................................................................................... 1
DESIGNATION................................................................................................................................ 1
DEFINITIONS.................................................................................................................................. 2
PART I........................................................................................................................................... 19
1......... Number of Authorized Shares................................................................................ 20
2......... Dividends............................................................................................................... 20
3......... Gross-Up Payments................................................................................................ 24
4......... Designation of Special Rate Periods....................................................................... 24
5......... Voting Rights.......................................................................................................... 28
6......... Minimum VRDP Shares Asset Coverage................................................................ 33
7......... VRDP Shares Basic Maintenance Amount............................................................. 33
8......... Restrictions on Dividends and Other Distributions................................................. 34
9......... Rating Agency Restrictions..................................................................................... 35
10....... Redemption............................................................................................................ 35
11....... Liquidation Rights.................................................................................................. 43
12....... Purchase Obligation................................................................................................ 44
13....... Miscellaneous......................................................................................................... 46
PART II.......................................................................................................................................... 47
1......... Remarketing Procedures......................................................................................... 47
2......... Remarketing Schedule............................................................................................ 49
3......... Determination of Applicable Rate.......................................................................... 52
4......... Failed Remarketing Condition................................................................................ 53
5......... Purchase of VRDP Shares by Remarketing Agent.................................................. 53
6......... Notification of Allocations..................................................................................... 53
7......... Transfers................................................................................................................ 54
8......... Global Certificate................................................................................................... 54
BLACKROCK MUNIYIELD CALIFORNIA FUND,
INC.
ARTICLES
OF AMENDMENT
AMENDING AND
RESTATING THE ARTICLES SUPPLEMENTARY
ESTABLISHING
AND FIXING THE
RIGHTS AND PREFERENCES OF
VARIABLE RATE DEMAND PREFERRED SHARES
BlackRock MuniYield California Fund, Inc., a
Maryland corporation (the “Corporation”), hereby certifies to the State
Department of Assessments and Taxation of the State of Maryland that:
FIRST: The Corporation desires to amend its charter by amending
and restating the Articles Supplementary Establishing and Fixing the Rights and
Preferences of Variable Rate Demand Preferred Shares, dated as May 17, 2011, as
previously amended by Articles of Amendment, dated as of June 20, 2012, and
Articles of Amendment, dated as of April 23, 2013 (collectively, the “Original Articles
Supplementary”, and as hereinafter amended and restated, the “Articles
Supplementary”).
SECOND: Pursuant to Section 2-604 of the Maryland General
Corporation Law, the following provisions are all the provisions of the
Articles Supplementary of the Corporation currently in effect:
EXPLANATORY STATEMENT
A.
Pursuant to authority expressly vested in the Board of Directors of the
Corporation by Article IV of the Corporation’s Charter, the Board of Directors
has, by resolution duly adopted on April 14, 2011, reclassified 1,059
authorized and unissued shares of common stock of the Corporation as shares of
preferred stock of the Corporation, par value $0.10 per share, as Variable Rate
Demand Preferred Shares (“VRDP Shares”). The Variable Rate Demand Preferred
Shares may be issued in one or more series, as designated and authorized by the
Board of Directors or a duly authorized committee thereof from time to time
(each series of VRDP Shares that may be authorized and issued, a “Series”).
B.
The preferences (including liquidation
preference), voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption, of the shares of each
Series of VRDP Shares were initially designated in the Original Articles
Supplementary.
C.
The Board of Directors of the
Corporation has by resolution authorized the amendment and restatement of the
Original Articles Supplementary effective as of the Effective Date.
D.
The Holders of the Series W-7 VRDP
Shares have consented to these Articles Supplementary.
E.
The preferences (including liquidation
preference), voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption, of the shares of each
Series of VRDP Shares are as follows or as set forth in an amendment to these
Articles Supplementary or otherwise in the Charter (each such Series being
referred to herein as a “Series of VRDP Shares”).
DESIGNATION
Series W-7: A series of 1,059 shares of preferred stock,
par value $0.10 per share, liquidation preference $100,000 per share, is hereby
authorized and designated “Series W-7 Variable Rate Demand Preferred Shares,”
also referred to herein as “Series W-7 VRDP Shares.” Each Series W-7 VRDP Share
shall be issued on a date determined by the Board of Directors of the
Corporation or pursuant to their delegated authority; have an Applicable Rate
equal to the sum of 0.20% per annum plus the Securities Industry and Financial
Markets Association (“SIFMA”) Municipal Swap Index, published at 3:00 p.m., New
York City time, on Wednesday, May 18, 2011, or 0.41% per annum, if the SIFMA
Municipal Swap Index is not so published for the Initial Rate Period from, and
including, the Date of Original Issue to, and including, May 25, 2011 and an
initial Dividend Payment Date of June 1, 2011; and have such other preferences,
voting powers, limitations as to dividends, qualifications and terms and
conditions of redemption, in addition to those required by applicable law or as
set forth in the Charter, as set forth in Part I and II of these Articles
Supplementary. The Series W-7 VRDP Shares shall constitute a separate series
of preferred stock of the Corporation and each Series W-7 VRDP Share shall be
identical. Except as otherwise provided with respect to any additional Series
of VRDP Shares, the terms and conditions of these Articles Supplementary apply
to each Series of VRDP Shares.
DEFINITIONS
The following terms shall have the following meanings
(with terms defined in the singular having comparable meanings when used in the
plural and vice versa), unless the context otherwise requires:
“1940 Act” means the Investment Company Act of
1940, as amended.
“Agent Member” means a Person with an account at
the Securities Depository that holds one or more shares of a Series of VRDP
Shares through the Securities Depository, directly or indirectly, for a
Beneficial Owner and that will be authorized and instructed, directly or
indirectly, by a Beneficial Owner to disclose information to the Remarketing
Agent and the Tender and Paying Agent with respect to such Beneficial Owner.
“Alternate VRDP Shares Purchase Agreement” means
any agreement with a successor liquidity provider replacing the VRDP Shares
Purchase Agreement (or any replacement therefor) upon its termination in accordance
with its terms and containing a Purchase Obligation substantially similar to
the Purchase Obligation therein as determined by the Corporation.
“Applicable Base Rate” means (i) with respect to a
Rate Period of fewer than 49 days, the greater of (a) the SIFMA Municipal Swap
Index or (b) the LIBOR Rate, and (ii) with respect to a Rate Period of 49 or
more days, the LIBOR Rate.
“Applicable Percentage” shall have the meaning set
forth in the definition of the Maximum Rate.
“Applicable Rate” means the dividend rate per
annum on any share of a Series of VRDP Shares for a Rate Period determined
as set forth in paragraph (e)(i) of Section 2 of Part I of these Articles
Supplementary or in the definition of “Maximum Rate,” as applicable.
“Applicable Rate Determination”
means each periodic operation of the process of determining the Applicable Rate
for the shares of a Series of VRDP Shares for a Subsequent Rate Period, as
provided in the VRDP Shares Remarketing Agreement and Part II of these Articles
Supplementary.
“Applicable Spread” means, in connection with the
Maximum Rate for any Rate Period (and subject to adjustment as described in the
definition of Maximum Rate) (i) when there is not a Failed Remarketing
Condition, 200 basis points (2.00%), and (ii) while a Failed Remarketing
Condition has occurred or is continuing, 200 basis points (2.00%) (up to 59
days of a continued Failed Remarketing Condition), 225 basis points (2.25%)
(sixty (60) days but fewer than ninety (90) days of a continued Failed Remarketing
Condition), 250 basis points (2.50%) (ninety (90) days but fewer than 120 days
of a continued Failed Remarketing Condition), 275 basis points (2.75%) (120
days but fewer than 150 days of a continued Failed Remarketing Condition), 300
basis points (3.00%) (150 days but fewer than 180 days of a continued Failed
Remarketing Condition), and 400 basis points (4.00%) (180 days or more of a
continued Failed Remarketing Condition), provided that, if at any time
when the Applicable Spread is 225 basis points (2.25%), 250 basis points
(2.50%), 275 basis points (2.75%), 300 basis points (3.00%) or 400 basis points
(4.00%) and the Failed Remarketing Condition no longer exists due to the
successful remarketing of all Purchased VRDP Shares, then such Applicable
Spread of 225 basis points (2.25%), 250 basis points (2.50%), 275 basis points
(2.75%), 300 basis points (3.00%) or 400 basis points (4.00%) will continue to
be the Applicable Spread in connection with determining the Maximum Rate in
effect for each Rate Period commencing with the first Subsequent Rate Period
after the Failed Remarketing Condition no longer exists through and including
the first Subsequent Rate Period ending on or after the 45th day after the day
the Failed Remarketing Condition no longer exists, provided, further,
that (i) if a new Failed Remarketing Condition occurs prior to the end of such
period and the Applicable Spread is then 225 basis points (2.25%), the date
such new Failed Remarketing Condition occurs will be deemed to be the 60th day
of a continued Failed Remarketing Condition, (ii) if a new Failed Remarketing
Condition occurs prior to the end of such period and the Applicable Spread is
then 250 basis points (2.50%), the date such new Failed Remarketing Condition
occurs will be deemed to be the 90th day of a continued Failed Remarketing
Condition, (iii) if a new Failed Remarketing Condition occurs prior to the end
of such period and the Applicable Spread is then 275 basis points (2.75%), the
date such new Failed Remarketing Condition occurs will be deemed to be the
120th day of a continued Failed Remarketing Condition, (iv) if a new Failed
Remarketing Condition occurs prior to the end of such period and the Applicable
Spread is then 300 basis points (3.00%), the date such new Failed Remarketing
Condition occurs will be deemed to be the 150th day of a continued Failed
Remarketing Condition and (v) if a new Failed Remarketing Condition occurs
prior to the end of such period and the Applicable Spread is then 400 basis
points (4.00%), the date such new Failed Remarketing Condition occurs will be
deemed to be the 180th day of a continued Failed Remarketing Condition, in each
case, solely for purposes of determining the Applicable Spread.
“Articles Supplementary” means these Articles of
Amendment Amending and Restating the Articles Supplementary Establishing and
Fixing the Rights and Preferences of VRDP Shares.
“Beneficial Owner” means a Person in whose name
shares of a Series of VRDP Shares are recorded as beneficial owner of such
shares of a Series of VRDP Shares by the Securities Depository, an Agent Member
or other securities intermediary on the records of such Securities Depository,
Agent Member or securities intermediary, as the case may be, or such Person’s
subrogee, including the Liquidity Provider to the extent it is at any time such
a beneficial owner of shares of a Series of VRDP Shares (irrespective of any
assignment or transfer by the Liquidity Provider of its voting rights).
“Board of Directors” means the Board of Directors
of the Corporation or any duly authorized committee thereof.
“Business Day” means a day
other than a day (a) on which commercial banks in The City of New York, New
York are required or authorized by law or executive order to close or (b) on
which the New York Stock Exchange is closed.
“Charter” means the Articles of Incorporation of
the Corporation, as amended and supplemented (including these Articles
Supplementary), on file in the State Department of Assessments and Taxation of the
State of Maryland.
“Code” means the Internal Revenue Code of 1986, as
amended.
“Common Shares” means the shares of common stock,
par value $0.10 per share, of the Corporation.
“Cure Date” means the VRDP Shares Basic Maintenance
Cure Date or the Minimum VRDP Shares Asset Coverage Cure Date, as the case may
be.
“Custodian” means a bank, as defined in Section
2(a)(5) of the 1940 Act, that has the qualifications prescribed in paragraph 1
of Section 26(a) of the 1940 Act, or such other entity as shall be providing
custodian services to the Corporation as permitted by the 1940 Act or any rule,
regulation, or order thereunder, and shall include, as appropriate, any
similarly qualified sub-custodian duly appointed by the Custodian.
“Date of Original Issue,” with respect to shares of
a Series of VRDP Shares, means the date on which the Corporation initially
issued such VRDP Shares.
“Deposit Securities” means, as of any date, any
United States dollar-denominated security or other investment of a type
described below that either (i) is a demand obligation payable to the holder
thereof on any Business Day or (ii) has a maturity date, mandatory redemption
date or mandatory payment date, on its face or at the option of the holder,
preceding the relevant payment date in respect of which such security or other
investment has been deposited or set aside as a Deposit Security:
(1) cash or any cash equivalent;
(2) any U.S. Government Security;
(3) any Municipal Obligation that has a credit
rating from at least one NRSRO that is the highest applicable rating generally
ascribed by such NRSRO to Municipal Obligations with substantially similar
terms as of the date of these Articles Supplementary (or such rating’s future
equivalent), including (A) any such Municipal Obligation that has been
pre-refunded by the issuer thereof with the proceeds of such refunding having
been irrevocably deposited in trust or escrow for the repayment thereof and (B)
any such fixed or variable rate Municipal Obligation that qualifies as an
eligible security under Rule 2a-7 under the 1940 Act;
(4) any investment in any money market fund
registered under the 1940 Act that qualifies under Rule 2a-7 under the 1940
Act, or similar investment vehicle described in Rule 12dl-l(b)(2) under the
1940 Act, that invests principally in Municipal Obligations or U.S. Government
Securities or any combination thereof; or
(5) any letter of credit from a bank or other
financial institution that has a credit rating from at least one NRSRO that is
the highest applicable rating generally ascribed by such NRSRO to bank deposits or short-term debt of similar banks or
other financial institutions as of the date of these Articles Supplementary (or
such rating’s future equivalent).
“Discounted Value,” as of any Valuation Date, shall
have the meaning set forth in the Rating Agency Guidelines.
“Dividend Payment Date,” except as otherwise
provided in paragraph (d) of Section 2 of Part I of these Articles
Supplementary, means the date that is the first (1st) Business Day of each
calendar month.
“Dividend Period,” with respect to shares of a
Series of VRDP Shares, means the period from, and including, the Date of
Original Issue of shares of such Series to, but excluding, the initial Dividend
Payment Date for shares of such Series and any period thereafter from, and
including, one Dividend Payment Date for shares of such Series to, but
excluding, the next succeeding Dividend Payment Date for shares of such Series.
“Effective Date” means June 19, 2019.
“Effective Leverage Ratio” has the meaning set
forth in the Fee Agreement.
“Effective Leverage Ratio Cure Period” has the
meaning set forth in the Fee Agreement.
“Electronic Means” means email transmission,
facsimile transmission or other similar electronic means of communication
providing evidence of transmission (but excluding online communications systems
covered by a separate agreement) acceptable to the sending party and the
receiving party, in any case if operative as between the relevant two (2) parties,
or, if not operative, by telephone (promptly confirmed by any other method set
forth in this definition), which, in the case of notices to the Tender and
Paying Agent, shall be sent by such means as set forth in Section 7.02 of the
Tender and Paying Agent Agreement or as specified in the related notice.
“Exchange Act” means the U.S. Securities Exchange
Act of 1934, as amended.
“Extraordinary Corporate Event” means as to the
Liquidity Provider, (i) the consolidation or amalgamation with, or merger with and
into, or the transfer of all or substantially all of the Liquidity Provider’s
assets to, another entity, or (ii) the dissolution, for any reason, of the
Liquidity Provider other than in connection with the consolidation or amalgamation
with, or merger with and into another entity, or the transfer of all or
substantially all of the Liquidity Provider’s assets to another entity; provided,
however, that with respect to (i) above, an Extraordinary Corporate
Event does not include any of the listed occurrences where (x) the surviving
entity, or transferee of all or substantially all of the Liquidity Provider’s
assets, (a) assumes all of the obligations of the Liquidity Provider under the
terms of the VRDP Shares Purchase Agreement and (b) has short-term debt ratings
in one of the two highest ratings categories from the Requisite NRSROs and (y)
the Liquidity Provider has provided notice in writing to the Corporation
confirming the information described in (x) at least ten (10) days prior to the
scheduled date of the applicable listed occurrence in (i) above.
“Failed Remarketing Condition” means a Failed
Remarketing Condition-Purchased VRDP Shares or a Failed Remarketing
Condition-Unpurchased VRDP Shares.
“Failed Remarketing Condition-Purchased VRDP Shares”
means that the Liquidity Provider acquires and continues to be the beneficial
owner for federal income tax purposes of any shares of
a Series of VRDP Shares in connection with purchases made pursuant to the
Purchase Obligation (whether as a result of an unsuccessful Remarketing or a
Mandatory Purchase) on any Purchase Date, including shares of a Series of VRDP
Shares that the Liquidity Provider continues to be the beneficial owner of for
federal income tax purposes after the expiration or termination of the VRDP
Shares Purchase Agreement.
“Failed Remarketing Condition-Purchased VRDP Shares
Redemption” means redemption by the Corporation, at a redemption price
equal to $100,000 per share plus accumulated but unpaid dividends
thereon (whether or not earned or declared) to, but excluding, the date fixed
by the Board of Directors for redemption, of shares of a Series of VRDP Shares
that the Liquidity Provider shall have acquired pursuant to the Purchase
Obligation and continued to be the beneficial owner of for federal income tax
purposes for a continuous period of six (6) months during which such VRDP
Shares are tendered for Remarketing on each Business Day in accordance with the
Related Documents but cannot be successfully remarketed pursuant to such
Remarketings (i.e., a Failed Remarketing Condition-Purchased VRDP Shares shall
have occurred and be continuing for such period of time with respect to such
VRDP Shares), determined by the Corporation on a first-in, first-out basis, in
accordance with and subject to the provisions of the Fee Agreement and these
Articles Supplementary.
“Failed Remarketing Condition-Unpurchased VRDP Shares”
means that a Beneficial Owner (other than the Liquidity Provider or its
affiliates) continues to hold shares of a Series of VRDP Shares, that were
subject to a Tender in accordance with the VRDP Shares Purchase Agreement,
after any Purchase Date as a result of the failure by the Liquidity Provider
for any reason to purchase such VRDP Shares pursuant to the Purchase Obligation
(whether as a result of an unsuccessful Remarketing or a Mandatory Purchase) (“Unpurchased
VRDP Shares”), until such time as all Outstanding Unpurchased VRDP Shares are
(i) successfully remarketed pursuant to a Remarketing, (ii) purchased by the
Liquidity Provider pursuant to the Purchase Obligation, or (iii) if not
successfully remarketed pursuant to a Remarketing or purchased by the Liquidity
Provider pursuant to the Purchase Obligation, the subject of a validly tendered
Notice of Revocation (or any combination of the foregoing); and any Unpurchased
VRDP Shares shall be deemed tendered for Remarketing until the earliest to
occur of the foregoing events (i), (ii) or (iii) with respect to such
Unpurchased VRDP Shares.
“Failure to Deposit” means, with respect to shares
of a Series of VRDP Shares, a failure by the Corporation to pay to the Tender
and Paying Agent, not later than 12:00 noon, New York City time, (A) on the
Business Day immediately preceding any Dividend Payment Date for shares of such
Series, in funds available on such Dividend Payment Date in The City of New
York, New York, the full amount of any dividend (whether or not earned or
declared) to be paid on such Dividend Payment Date on any share of such Series
or (B) on the Business Day immediately preceding any redemption date in funds
available on such redemption date for shares of such Series in The City of New
York, New York, the Redemption Price to be paid on such redemption date for any
share of such Series after Notice of Redemption is provided pursuant to
paragraph (c) of Section 10 of Part I of these Articles Supplementary; provided,
however, that the foregoing clause (B) shall not apply to the
Corporation’s failure to pay the Redemption Price in respect of shares of a
Series of VRDP Shares when the related Notice of Redemption provides that
redemption of such shares is subject to one or more conditions precedent and
any such condition precedent shall not have been satisfied at the time or times
and in the manner specified in such Notice of Redemption.
“Fee Agreement” means the VRDP Shares Fee
Agreement, dated as of June 19, 2019, between the Corporation and the Liquidity
Provider, as amended, modified or supplemented from time to time or any similar
agreement with a successor Liquidity Provider.
“Final Notice of Purchase”
means, in connection with an Optional Tender or a Mandatory Tender, a Notice of
Purchase delivered by the Tender and Paying Agent to the Liquidity Provider (or
directly to the Liquidity Provider by Beneficial Owners or their Agent Members,
in the case of an Optional Tender, or Holders, in the case of a Mandatory
Tender, if there is no Tender and Paying Agent or for any reason the Tender and
Paying Agent does not perform its obligations) on the Purchase Date indicating
the number of shares of a Series of VRDP Shares to be purchased on such date
pursuant to the Purchase Obligation, or, in connection with a Mandatory
Purchase, the Mandatory Purchase Notice delivered by the Corporation or the
Tender and Paying Agent on behalf of the Corporation.
“Fitch” means Fitch Ratings.
“Fitch Eligible Assets” means assets of the
Corporation set forth in the Fitch Guidelines as eligible for inclusion in
calculating the Discounted Value of the Corporation’s assets in connection with
Fitch ratings of shares of a Series of VRDP Shares at the request of the
Corporation.
“Fitch Guidelines” means the guidelines applicable
to Fitch’s current ratings of the VRDP Shares, provided by Fitch in connection
with Fitch’s ratings of shares of a Series of VRDP Shares at the request of the
Corporation (a copy of which is available on request to the Corporation), in
effect on the date hereof and as may be amended from time to time, provided,
however, that any such amendment will not be effective for thirty (30)
days from the date that Fitch provides final notice of such amendment to the
Corporation.
“Fitch Provisions” means Sections 7, 8(c)(B) and 9
of Part I of these Articles Supplementary with respect to Fitch, and any other
provisions hereof with respect to Fitch’s ratings of shares of a Series of VRDP
Shares at the request of the Corporation, including any provisions with respect
to obtaining and maintaining a rating on VRDP Shares from Fitch. The
Corporation is required to comply with the Fitch Provisions only if Fitch is
then rating shares of a Series of VRDP Shares at the request of the
Corporation.
“Gross-up Payment” means payment to a Beneficial
Owner of an amount which, when taken together with the aggregate amount of
Taxable Allocations made to such Beneficial Owner to which such Gross-up
Payment relates, would cause such Beneficial Owner’s dividends in dollars
(after regular federal income tax consequences) from the aggregate of such
Taxable Allocations and the related Gross-up Payment to be equal to the dollar
amount of the dividends which would have been received by such Beneficial Owner
if the amount of such aggregate Taxable Allocations would have been excludable
from the gross income of such Beneficial Owner. Such Gross-up Payment shall be
calculated (i) without consideration being given to the time value of money;
(ii) assuming that no Beneficial Owner of shares of a Series of VRDP Shares is
subject to the federal alternative minimum tax with respect to dividends
received from the Corporation; (iii) assuming that each Taxable Allocation and
each Gross-up Payment (except to the extent such Gross-up Payment is designated
as an exempt-interest dividend under Section 852(b)(5) of the Code or successor
provisions) would be taxable in the hands of each Beneficial Owner of shares of
a Series of VRDP Shares at the maximum marginal combined regular federal and
California individual income tax rate applicable to ordinary income or net
capital gains (taking into account the federal income tax deductibility of
state taxes paid or incurred), as applicable, or the maximum marginal combined
regular federal and California corporate income tax rate applicable to ordinary
income or net capital gains (taking into account the federal income tax
deductibility of state taxes paid or incurred), as applicable, whichever is
greater, in effect at the time such Gross-up Payment is made; and (iv) assuming
that each Taxable Allocation and each Gross-up Payment would not be subject to
the tax imposed by Section 1411 of the Code or any similar Medicare or other
surtax.
“Holder” means a Person in
whose name a share of a Series of VRDP Shares is registered in the registration
books of the Corporation maintained by the Tender and Paying Agent.
“Initial Rate Period,” with respect to Series W-7
VRDP Shares, means the period commencing on and including the Date of Original
Issue thereof and ending on, and including, May 25, 2011, the next succeeding
Wednesday, as set forth under “Designation” above.
“Investment Adviser” means BlackRock Advisors, LLC,
or any successor company or entity.
“Late Charge” shall have the meaning specified in
paragraph (e)(i)(C) of Section 2 of Part I of these Articles Supplementary.
“LIBOR Dealer” means such LIBOR dealer or dealers
as the Corporation from time to time may appoint or in lieu of any thereof,
their respective affiliates and successors.
“LIBOR Rate” means, on any Rate Determination Date,
(i) the rate for deposits in U.S. dollars for the designated Rate Period, which
appears on Reuters display page LIBOR01 (“Page LIBOR01”) (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 Rate
Determination Date (the “LIBOR Determination Date”), or (ii) if such rate does
not appear on Page LIBOR01 or such other page as may replace such Page LIBOR01,
(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 Rate Period in an amount
determined by such LIBOR Dealer by reference to requests for quotations as of
approximately 11:00 a.m. (London time) on such date made by such LIBOR Dealer
to the Reference Banks, (B) if at least two of the Reference Banks provide such
quotations, the LIBOR Rate shall equal such arithmetic mean of such quotations,
(C) if only one or none of the Reference Banks provide such quotations, the
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 Rate 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 Rate Determination Date.
If the number of days in a Rate Period shall be (i) seven 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.
“Liquidation Preference,” with respect to a given
number of Series W-7 VRDP Shares, means $100,000 times that number.
“Liquidity Account Investments” means Deposit
Securities or any other security or investment owned by the Corporation that is
rated at least A- or the equivalent rating (or any such rating’s future
equivalent) by each NRSRO then rating such security or investment (or if rated
by only one NRSRO, by such NRSRO) or, if no NRSRO is then rating such security,
deemed to be, with the prior written consent of the Liquidity Provider, of an
equivalent rating by the Investment Adviser on the Corporation’s books and
records.
“Liquidity Provider” means any entity in such
capacity pursuant to a VRDP Shares Purchase Agreement.
“Liquidity Provider Ratings Event” means the
Liquidity Provider shall fail to maintain at any time short-term debt ratings
in one of the two highest rating categories from the Requisite NRSROs.
“Liquidity Provider Ratings Event Termination Date”
means the date established by the Tender and Paying Agent, acting upon
instructions of the Corporation pursuant to the Tender and Paying Agent
Agreement, for termination of the VRDP Shares Purchase Agreement upon the
occurrence of a Liquidity Provider Ratings Event, which date shall be not less
than sixteen (16) days nor more than thirty (30) days following the date on
which such Liquidity Provider Ratings Event first occurs.
“London Business Day” means any day on which
commercial banks are generally open for business in London.
“Mandatory Purchase” means the mandatory purchase
of Outstanding shares of a Series of VRDP Shares by the Liquidity Provider
pursuant to the VRDP Shares Purchase Agreement in connection with a Mandatory
Purchase Event.
“Mandatory Purchase Date” means the Purchase Date
for a Mandatory Purchase in accordance with these Articles Supplementary and
the VRDP Shares Purchase Agreement.
“Mandatory Purchase Event” means, (i) in connection
with the termination of the VRDP Shares Purchase Agreement due to its
expiration as of a Scheduled Termination Date, by the fifteenth day prior to
any such Scheduled Termination Date, (a) the Liquidity Provider shall not have
agreed to an extension or further extension of the Scheduled Termination Date
to a date not earlier than 180 days from the Scheduled Termination Date of the
VRDP Shares Purchase Agreement then in effect, and (b) the Corporation shall
not have obtained and delivered to the Tender and Paying Agent an Alternate
VRDP Shares Purchase Agreement with a termination date not earlier than 180 days
from the Scheduled Termination Date of the VRDP Shares Purchase Agreement, or
(ii) in connection with the termination of the VRDP Shares Purchase Agreement
due to a Liquidity Provider Ratings Event or Related Party Termination Event,
by the fifteenth day prior to the Liquidity Provider Ratings Event Termination
Date or Related Party Termination Date, as the case may be, the Corporation
shall not have obtained and delivered to the Tender and Paying Agent an
Alternate VRDP Shares Purchase Agreement with a termination date not earlier
than 180 days from the Liquidity Provider Ratings Event Termination Date or
Related Party Termination Date, as the case may be, of the VRDP Shares Purchase
Agreement. The Mandatory Purchase Event shall be deemed to occur on such
fifteenth day prior to any Scheduled Termination Date,
Liquidity Provider Ratings Event Termination Date or Related Party Termination
Date, as the case may be.
“Mandatory Purchase Notice” means, in connection
with the Mandatory Purchase of shares of a Series of VRDP Shares, a notice,
substantially in the form attached to the VRDP Shares Purchase Agreement as
Exhibit B, delivered by the Corporation or the Tender and Paying Agent on
behalf of the Corporation to the Holders and the Liquidity Provider in
accordance with the VRDP Shares Purchase Agreement and specifying a Mandatory
Purchase Date.
“Mandatory Tender,” with respect to a Mandatory
Tender Event, means the mandatory tender of all shares of a Series of VRDP
Shares by Holders for Remarketing or, in the event (i) no Remarketing occurs on
or before the Purchase Date or (ii) pursuant to an attempted Remarketing,
shares of the Series of VRDP Shares remain unsold and the Remarketing Agent
does not purchase for its own account the unsold shares of the Series of VRDP
Shares tendered to the Tender and Paying Agent for Remarketing (provided,
that the Remarketing Agent may seek to sell such shares of the Series of VRDP
Shares in a subsequent Remarketing prior to the Purchase Date), for purchase by
the Liquidity Provider at the Purchase Price pursuant to Section 2 of Part II
of these Articles Supplementary and the VRDP Shares Purchase Agreement.
“Mandatory Tender Event” means (a) each failure by
the Corporation to make a scheduled payment of dividends on a Dividend Payment
Date; (b) the occurrence of a Liquidity Provider Ratings Event (which shall
constitute a single Mandatory Tender Event upon the occurrence of such
Liquidity Provider Ratings Event, whether or not continuing and whether or not
such Liquidity Provider Ratings Event also results in a Mandatory Purchase
Event; provided that, following restoration of the short-term debt
ratings to the requisite level, a subsequent Liquidity Provider Ratings Event,
shall constitute a new Mandatory Tender Event); (c) in the event of a failure
by the Corporation to pay the Liquidity Provider the applicable fee when due
under the terms of the Fee Agreement, if the Liquidity Provider (in its sole
discretion) thereafter provides written notice to the Corporation that such
failure to pay such fee constitutes a Mandatory Tender Event; (d) the eighth
(8th) day prior to the scheduled date of the occurrence of an Extraordinary
Corporate Event; (e) the Corporation shall have obtained and delivered to the
Tender and Paying Agent an Alternate VRDP Shares Purchase Agreement by the
fifteenth (15th) day prior to the Scheduled Termination Date, Liquidity
Provider Ratings Event Termination Date or Related Party Termination Date, as
the case may be, of the VRDP Shares Purchase Agreement; (f) the Corporation
shall have provided a Notice of Proposed Special Rate Period in accordance with
these Articles Supplementary; or (g) in the event of a breach by the
Corporation of its Effective Leverage Ratio covenant with the Liquidity
Provider in the Fee Agreement and the failure to cure such breach within sixty
(60) days from the date of such breach (which 60-day period would include the
Effective Leverage Ratio Cure Period), if the Liquidity Provider (in its sole
discretion) thereafter provides written notice to the Corporation and the
Tender and Paying Agent that the failure to timely cure such breach constitutes
a Mandatory Tender Event (subject to the Corporation curing such breach prior
to the delivery date of such notice from the Liquidity Provider).
“Mandatory Tender Notice” means, in connection with
the Mandatory Tender of shares of a Series of VRDP Shares, a notice,
substantially in the form attached to the VRDP Shares Remarketing Agreement as
Annex II, delivered by the Corporation or the Tender and Paying Agent on behalf
of the Corporation to the Holders and the Liquidity Provider in accordance with
the VRDP Shares Purchase Agreement and specifying a Mandatory Tender Event and
Purchase Date.
“Market Value” of any asset of the Corporation
means the market value thereof determined by an independent third-party pricing
service designated pursuant to the Corporation’s valuation policies and
procedures approved from time to time by the Board of Directors for use in connection with the determination of the Corporation’s
net asset value. Market Value of any asset shall include any interest or
dividends, as applicable, accrued thereon. The pricing service values
portfolio securities at the mean between the quoted bid and asked price or the
yield equivalent when quotations are readily available. Securities for which
quotations are not readily available are 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 or a matrix system, or both, to determine valuations.
“Maximum Rate” for shares of a Series of VRDP
Shares on any Rate Determination Date or in respect of the occurrence of a
Failed Remarketing Condition for shares of such series, means the Applicable
Percentage of the Applicable Base Rate plus the Applicable Spread. The
Maximum Rate for shares of a Series of VRDP Shares will depend on the long-term
rating assigned to such Series of VRDP Shares, the length of the Rate Period
and whether or not the Corporation has given notification to the Remarketing
Agent and the Tender and Paying Agent prior to the Applicable Rate
Determination for the Rate Period pursuant to Section 6 of Part II hereto that
any ordinary income or capital gains will be included in the dividend on shares
of a Series of VRDP Shares for that Rate Period. The Applicable Percentage of
the Applicable Base Rate is as follows:
Long-Term Rating
|
Applicable
Percentage of Applicable Base Rate—
No Notification
|
Fitch
|
Moody’s
|
|
AA- to AAA
|
Aa3 to Aaa
|
100%
|
BBB- to A+
|
Baa3 to A1
|
110%
|
Below BBB-**
|
Below Baa3**
|
135%
|
___________________
* And/or
the equivalent ratings of any Other Rating Agency then rating the shares of the
Series of VRDP Shares at the request of the Corporation; utilizing the lower of
the ratings of the Rating Agencies then rating VRDP Shares at the request of
the Corporation.
** Includes
unrated, if no Rating Agency is then rating VRDP Shares.
provided, however, that in the event the
Corporation has given notification prior to the Applicable Rate Determination
for the Rate Period pursuant to Section 6 of Part II hereof that any ordinary
income and capital gains will be included in the dividend on shares of the
Series of VRDP Shares for that Rate Period, the Applicable Percentage in the
foregoing table shall be divided by the quantity one (1) minus (i) the maximum
marginal combined regular federal and California personal income tax rate
(taking into account the federal income tax deductibility of state taxes paid
or incurred) applicable to ordinary income or net capital gains (as
applicable), each expressed as a decimal applicable to ordinary income or net
capital gains (as applicable), or (ii) the maximum marginal combined regular
federal and California corporate income tax rate (taking into account the
federal income tax deductibility of state taxes paid or incurred) applicable to
ordinary income or net capital gains (as applicable), each expressed as a
decimal applicable to ordinary income or net capital gains (as applicable),
whichever is greater and determined on a weighted average basis in respect of
the relative amounts of ordinary income and net capital gains.
The Applicable Percentage as so determined and the
Applicable Spread may be subject to upward (and if previously adjusted upward,
subsequent downward) adjustment as provided in the VRDP Shares Remarketing
Agreement, with the prior written consent of the Liquidity Provider and after
consultation with the Remarketing Agent; provided, that, notwithstanding
any provision to the contrary in the VRDP Shares Remarketing Agreement, the
Maximum Rate is equal to or higher than the rates determined
as set forth above, and immediately following any such increase, the
Corporation would be in compliance with the Minimum VRDP Shares Asset Coverage
and the VRDP Shares Basic Maintenance Amount in the Rating Agency Guidelines of
the NRSRO or NRSROs then rating the VRDP Shares at the request of the
Corporation. Furthermore, in the event of Special Rate Periods of greater than
364 days, the Maximum Rate may be subject to upward adjustment as provided in
the VRDP Shares Remarketing Agreement, with the prior written consent of the
Liquidity Provider and after consultation with the Remarketing Agent; provided,
that, notwithstanding any provision to the contrary in the VRDP Shares
Remarketing Agreement, immediately following any such increase, the Corporation
would be in compliance with the Minimum VRDP Shares Asset Coverage and the VRDP
Shares Basic Maintenance Amount in the Rating Agency Guidelines of the NRSRO or
NRSROs then rating the VRDP Shares at the request of the Corporation.
A Maximum Rate in effect in respect of a Failed Remarketing
Condition will continue to be the Applicable Rate (i) until the first (1st) day
of the next succeeding Subsequent Rate Period after a Failed Remarketing
Condition no longer exists in the case of a Minimum Rate Period or a Special
Rate Period of twenty eight (28) Rate Period Days or fewer, and (ii) until the
first (1st) day of the next succeeding Dividend Period after a Failed
Remarketing Condition no longer exists in the case of a Special Rate Period of
greater than twenty-eight (28) Rate Period Days.
Notwithstanding any provision to the contrary in the VRDP
Shares Remarketing Agreement, in no event shall the Maximum Rate exceed 15%; provided,
however, that in the event the Corporation has given notification prior
to the Applicable Rate Determination for the Rate Period pursuant to Section 6
of Part II hereof that any ordinary income or capital gains will be included in
the dividend on shares of the Series of VRDP Shares for that Rate Period, the
Maximum Rate shall not exceed 15% divided by the quantity one (1) minus (i) the
maximum marginal combined regular federal and California personal income tax
rate (taking into account the federal income tax deductibility of state taxes
paid or incurred) applicable to ordinary income or net capital gains (as applicable),
each expressed as a decimal applicable to ordinary income or net capital gains
(as applicable), or (ii) the maximum marginal combined regular federal and
California corporate income tax rate (taking into account the federal income
tax deductibility of state taxes paid or incurred) applicable to ordinary
income or net capital gains (as applicable), each expressed as a decimal
applicable to ordinary income or net capital gains (as applicable), whichever
is greater and determined on a weighted average basis in respect of the
relative amounts of ordinary income and net capital gains.
“Minimum Rate Period” means any Rate Period
consisting of seven (7) Rate Period Days, as adjusted to reflect any changes
when the regular day that is a Rate Determination Date is not a Business Day.
“Minimum VRDP Shares Asset Coverage” means asset
coverage, as defined in Section 18(h) of the 1940 Act as of the date of the Fee
Agreement (excluding (1) from the denominator of such asset coverage test any
senior securities for which the Corporation has issued a Notice of Redemption
and either has delivered Deposit Securities to the Tender and Paying Agent or
otherwise has adequate Deposit Securities on hand and segregated on the books
and records of the Custodian for the purpose of such redemption and (2) from
the numerator of such asset coverage test, any Deposit Securities referred to
in the previous clause (1)), with such changes thereafter as agreed with the
prior written consent of the Liquidity Provider, of at least 200% or such
higher percentage as required and specified in the Fee Agreement, but, in any
event, not more than 250%, with respect to all outstanding senior securities of
the Corporation which are stock, including all Outstanding VRDP Shares (or, in
each case, if higher, such other asset coverage as may in the future be
specified in or under the 1940 Act as the minimum asset coverage for senior
securities which are stock of a closed-end investment company as a condition of
declaring dividends on its common shares or stock).
“Minimum VRDP Shares Asset
Coverage Cure Date,” with respect to the failure by the Corporation to
maintain the Minimum VRDP Shares Asset Coverage (as required by Section 6 of
Part I of these Articles Supplementary and the Fee Agreement) as of the last
Business Day of each month, means the tenth Business Day of the following
month.
“Moody’s” means Moody’s Investors Service, Inc.
“Moody’s Discount Factor” means the discount
factors set forth in the Moody’s Guidelines for use in calculating the Discounted
Value of the Corporation’s assets in connection with Moody’s ratings of shares
of a Series of VRDP Shares at the request of the Corporation.
“Moody’s Eligible Assets” means assets of the
Corporation set forth in the Moody’s Guidelines as eligible for inclusion in
calculating the Discounted Value of the Corporation’s assets in connection with
Moody’s ratings of shares of a Series of VRDP Shares at the request of the
Corporation.
“Moody’s Guidelines” means the guidelines
applicable to Moody’s current ratings of the VRDP Shares, provided by Moody’s
in connection with Moody’s ratings of shares of a Series of VRDP Shares at the
request of the Corporation (a copy of which is available on request of the
Corporation), in effect on the date hereof and as may be amended from time to
time; provided, however, that any such amendment will not be
effective for thirty (30) days from the date that Moody’s provides final notice
of such amendment to the Corporation.
“Moody’s Provisions” means Sections 7, 8(c)(B) and
9 of Part I of these Articles Supplementary with respect to Moody’s, and any
other provisions hereof with respect to Moody’s ratings of shares of a Series
of VRDP Shares at the request of the Corporation, including any provisions
hereof with respect to obtaining and maintaining a rating on shares of a Series
of VRDP Shares from Moody’s. The Corporation is required to comply with the
Moody’s Provisions only if Moody’s is then rating shares of a Series of VRDP
Shares at the request of the Corporation.
“Municipal Obligations” means Municipal Bonds as defined
under the caption “The Fund’s Investments” in the Offering Memorandum.
“Net Tax-Exempt Income” means the excess of the
amount of interest excludable from gross income under Section 103(a) of the
Code over the amounts disallowed as deductions under Sections 265 and 171(a)(2)
of the Code.
“Notice of Proposed Special Rate Period” means any
notice with respect to a proposed Special Rate Period of shares of a Series of
VRDP Shares pursuant to paragraph (c) of Section 4 of Part I of these Articles
Supplementary.
“Notice of Purchase” means, as the context
requires, a Preliminary Notice of Purchase or a Final Notice of Purchase, in
each case, substantially in the form attached as Exhibit A to the VRDP Shares
Purchase Agreement.
“Notice of Redemption” has the meaning specified in
paragraph (c) of Section 10 of Part I of these Articles Supplementary.
“Notice of Revocation” means, in connection with
the revocation by a Beneficial Owner or its Agent Member of its Notice of
Tender, a notice, substantially in the form attached to the Tender and Paying
Agent Agreement as Exhibit C, delivered by a Beneficial Owner or its Agent
Member to the Tender and Paying Agent indicating an intention to revoke the
tender of some or all of the shares of a Series of
VRDP Shares for sale on a Purchase Date pursuant to paragraph (t) of Section 1
of Part II of these Articles Supplementary.
“Notice of Special Rate Period” means any notice
with respect to a Special Rate Period of shares of a Series of VRDP Shares
pursuant to paragraph (d)(i) of Section 4 of Part I of these Articles
Supplementary.
“Notice of Tender” means, in connection with an
Optional Tender, a notice, substantially in the form attached to the Tender and
Paying Agent Agreement as Exhibit A, delivered by a Beneficial Owner or its
Agent Member to the Tender and Paying Agent, indicating an intention to tender
shares of a Series of VRDP Shares for sale on a Purchase Date pursuant to
Section 1 of Part II of these Articles Supplementary.
“NRSRO” means a “nationally recognized
statistical rating organization” within the meaning of Section 3(a)(62) of
the Exchange Act that is not an “affiliated person” (as defined in
Section 2(a)(3) of the 1940 Act) of the Corporation or the Liquidity Provider,
including, at the date hereof, Moody’s, Fitch and S&P.
“Offering Memorandum” means the offering memorandum
in respect of the Corporation’s sale of Series W-7 VRDP Shares, dated June 19,
2019, as amended, revised or supplemented from time to time, including in
connection with any Remarketing, if applicable.
“Optional Tender” means any tender of shares of a
Series of VRDP Shares by a Beneficial Owner or its Agent Member to the Tender
and Paying Agent, other than a Mandatory Tender, for Remarketing or, in the
event (i) no Remarketing occurs on or before the Purchase Date, or (ii)
pursuant to an attempted Remarketing shares of a Series of VRDP Shares remain
unsold and the Remarketing Agent does not purchase for its own account the
unsold shares of a Series of VRDP Shares tendered to the Tender and Paying
Agent for Remarketing (provided, that the Remarketing Agent may seek to
sell such VRDP Shares in a subsequent Remarketing prior to the Purchase Date),
for purchase by the Liquidity Provider pursuant to Section 2 of Part II of
these Articles Supplementary and the VRDP Shares Purchase Agreement.
“Other Rating Agency” means each NRSRO, if any,
other than Moody’s or Fitch then providing a rating for the shares of a Series
of VRDP Shares at the request of the Corporation.
“Other Rating Agency Eligible Assets” means assets
of the Corporation set forth in the Other Rating Agency Guidelines as eligible
for inclusion in calculating the Discounted Value of the Corporation’s assets
in connection with Other Rating Agency ratings of shares of a Series of VRDP
Shares at the request of the Corporation.
“Other Rating Agency Guidelines” means the
guidelines applicable to each Other Rating Agency’s ratings of the VRDP Shares,
provided by such Other Rating Agency in connection with such Other Rating
Agency’s ratings of shares of a Series of VRDP Shares at the request of the
Corporation (a copy of which is available on request to the Corporation), as
may be amended from time to time, provided, however, that any
such amendment will not be effective except as agreed upon by the Other Rating
Agency and the Corporation.
“Other Rating Agency Provisions” means Sections 7,
8(c)(B) and 9 of Part I of these Articles Supplementary with respect to any
Other Rating Agency then rating shares of a Series of VRDP Shares at the
request of the Corporation, and any other provisions hereof with respect to
such Other Rating Agency’s ratings of shares of a Series of VRDP Shares,
including any provisions with respect to obtaining and
maintaining a rating of shares of a Series of VRDP Shares from such Other
Rating Agency. The Corporation is required to comply with the Other Rating
Agency Provisions of an Other Rating Agency only if such Other Rating Agency is
then rating shares of a Series of VRDP Shares at the request of the
Corporation.
“Outstanding” means, as of any date with respect to
VRDP Shares of any Series, the number of shares of such Series theretofore
issued by the Corporation except, without duplication, (i) any shares of such
Series of VRDP Shares theretofore cancelled or delivered to the Tender and
Paying Agent for cancellation or redemption by the Corporation, (ii) any shares
of such Series of VRDP Shares with respect to which the Corporation has given a
Notice of Redemption and irrevocably deposited with the Tender and Paying Agent
sufficient Deposit Securities to redeem such shares of such Series of VRDP
Shares, pursuant to Section 10 of Part I of these Articles Supplementary, (iii)
any shares of such Series of VRDP Shares as to which the Corporation shall be a
Beneficial Owner, and (iv) any shares of such Series of VRDP Shares represented
by any certificate in lieu of which a new certificate has been executed and
delivered by the Corporation; provided, however, with respect to
clause (ii), any such shares of such Series of VRDP Shares will be deemed to be
Outstanding for purposes of the VRDP Shares Purchase Agreement until redeemed
by the Corporation.
“Person” means and includes an individual, a
partnership, a corporation, a trust, an unincorporated association, a joint
venture or other entity or government or any agency or political subdivision
thereof.
“Preferred Shares” mean the shares of preferred
stock of the Corporation, and includes the VRDP Shares.
“Preliminary Notice of Purchase” means a Notice of
Purchase delivered by the Tender and Paying Agent to the Liquidity Provider (or
directly to the Liquidity Provider by Beneficial Owners or their Agent Members
if there is no Tender and Paying Agent or for any reason the Tender and Paying
Agent does not perform its obligations) on the Business Day immediately
preceding a Purchase Date indicating the number of shares of VRDP Shares to be
purchased on the Purchase Date pursuant to the Purchase Obligation.
“Purchase Date,” with respect to any purchase of
shares of a Series of VRDP Shares, means (i) in connection with an Optional
Tender, the date specified in a Notice of Tender, which date shall be no
earlier than the seventh (7th) day (or, if such day is not a Business Day, the
next succeeding Business Day) following delivery to the Tender and Paying
Agent of the Notice of Tender, (ii) in connection with a Mandatory Tender, the
date specified in the Mandatory Tender Notice (or, if such day is not a
Business Day, the next succeeding Business Day), subject to the immediately
succeeding sentence below, or (iii) in connection with a Mandatory Purchase,
the Mandatory Purchase Date specified in the Mandatory Purchase Notice (or, if
such day is not a Business Day, the next succeeding Business Day). The
Purchase Date in respect of a Mandatory Tender Event shall be not later than
seven (7) days following the date a Mandatory Tender Notice is sent to Holders
by Electronic Means; provided that (A) the Purchase Date in connection
with the failure of the Corporation to pay the applicable fee to the Liquidity
Provider may not be later than the last Business Day of the month such payment
was due; (B) the Purchase Date in connection with the occurrence of an
Extraordinary Corporate Event may not be later than the Business Day
immediately preceding the occurrence of the Extraordinary Corporate Event (and,
if no earlier Purchase Date is specified in a Mandatory Tender Notice with respect
to such Extraordinary Corporate Event, the Business Day immediately preceding
the occurrence of the Extraordinary Corporate Event shall be deemed to be the
Purchase Date irrespective of the failure to have given or sent a Mandatory
Tender Notice); (C) the Purchase Date in connection with the Corporation
obtaining an Alternate VRDP Shares Purchase Agreement may not be later than the
Business Day immediately preceding the termination of
the VRDP Shares Purchase Agreement and the effective date of such Alternate
VRDP Shares Purchase Agreement (which may not be later than the termination
date of the VRDP Shares Purchase Agreement); and (D) the Purchase Date in
connection with a Notice of Proposed Special Rate Period may not be later than
the first (1st) day of such proposed Special Rate Period.
“Purchase Obligation” means the unconditional and
irrevocable obligation of the Liquidity Provider during the term and pursuant
to the terms of the VRDP Shares Purchase Agreement to purchase Outstanding
shares of a Series of VRDP Shares on any Purchase Date at the Purchase Price
from Beneficial Owners, in the case of any Optional Tender, and Holders, in the
case of any Mandatory Tender or any Mandatory Purchase, in each case following
delivery of a Final Notice of Purchase with respect to such VRDP Shares.
“Purchase Price” means an amount equal to the
Liquidation Preference of any shares of a Series of VRDP Shares to be purchased
on a Purchase Date, plus any accumulated but unpaid dividends thereon
(whether or not earned or declared), if any, to, but excluding, the relevant
Purchase Date.
“Purchased VRDP Shares” means all shares of a
Series of VRDP Shares purchased by the Liquidity Provider pursuant to the VRDP
Shares Purchase Agreement, so long as the Liquidity Provider continues to be
the beneficial owner for federal income tax purposes of such VRDP Shares.
“Rate Determination Date” means, with respect to
any Series of VRDP Shares, the last day of a Rate Period for such Series or, if
such day is not a Business Day, the next succeeding Business Day; provided,
however, that the next succeeding Rate Determination Date will be
determined without regard to any prior extension of a Rate Determination Date
to a Business Day.
“Rate Period,” with respect to shares of a Series
of VRDP Shares, means the Initial Rate Period for shares of such Series and any
Subsequent Rate Period, including any Special Rate Period for shares of such
Series.
“Rate Period Days,” for any Rate Period, means the
number of days that would constitute such Rate Period but for the application
of paragraph (d) of Section 2 of Part I of these Articles Supplementary or
paragraph (b) of Section 4 of Part I of these Articles Supplementary.
“Rating Agency” means each of Fitch (if Fitch is
then rating shares of a Series of VRDP Shares at the request of the
Corporation), Moody’s (if Moody’s is then rating shares of a Series of VRDP
Shares at the request of the Corporation), S&P (if S&P is then rating
shares of a Series of VRDP Shares at the request of the Corporation) and any
Other Rating Agency (if such Other Rating Agency is then rating shares of a
Series of VRDP Shares at the request of the Corporation).
“Rating Agency Certificate” has the meaning specified
in paragraph (b) of Section 7 of Part I of these Articles Supplementary.
“Rating Agency Eligible Assets” means assets of the
Corporation set forth in the Rating Agency Guidelines of a Rating Agency as
eligible for inclusion in calculating the Discounted Value of the Corporation’s
assets in connection with such Rating Agency’s rating of shares of a Series of
VRDP Shares at the request of the Corporation.
“Rating Agency Guidelines” means Moody’s Guidelines
(if Moody’s is then rating shares of a Series of VRDP Shares at the request of
the Corporation), Fitch Guidelines (if Fitch is then rating shares of a Series
of VRDP Shares at the request of the Corporation) and any Other Rating Agency Guidelines (if such Other Rating Agency is then rating
shares of a Series of VRDP Shares at the request of the Corporation).
“Rating Agency Provisions” means the Moody’s
Provisions (if Moody’s is then rating shares of a Series of VRDP Shares at the
request of the Corporation), the Fitch Provisions (if Fitch is then rating
shares of a Series of VRDP Shares at the request of the Corporation) and any
Other Rating Agency Provisions (if such Other Rating Agency is then rating VRDP
Shares at the request of the Corporation). The Corporation is required to
comply with the Rating Agency Provisions of a Rating Agency only if such Rating
Agency is then rating shares of a Series of VRDP Shares at the request of the
Corporation.
“Redemption Date” has the meaning specified in
paragraph (c) of Section 10 of Part I of these Articles Supplementary.
“Redemption Price” means the applicable redemption
price specified in paragraph (a) or (b) of Section 10 of Part I of these
Articles Supplementary.
“Reference Banks” means four major banks in the
London interbank market selected by the Remarketing Agent or its affiliates or
successors or such other party as the Corporation may from time to time
appoint.
“Related Documents” means the Charter, the Series
W-7 VRDP Shares, the VRDP Shares Purchase Agreement, the VRDP Shares
Remarketing Agreement, the Fee Agreement and the Tender and Paying Agent
Agreement.
“Related Party” means a related party for purposes
of Section 267(b) or Section 707(b) of the Code, as such provisions may be
amended from time to time.
“Related Party Termination Date” means the
effective date of the termination of the VRDP Shares Purchase Agreement in
accordance with its terms following the occurrence of a Related Party
Termination Event.
“Related Party Termination Event” means the
Liquidity Provider becoming a Related Party of the Corporation other than
through the acquisition of shares of a Series of VRDP Shares pursuant to the
terms of the VRDP Shares Purchase Agreement.
“Remarketing” means the remarketing of shares of a
Series of VRDP Shares by the Remarketing Agent on behalf of the Beneficial
Owners thereof pursuant to an Optional Tender or on behalf of the Holders
thereof pursuant to a Mandatory Tender, as provided in the VRDP Shares
Remarketing Agreement and Part II of these Articles Supplementary.
“Remarketing Agent” means, with respect to the
Series W-7 VRDP Shares, the Person or Persons designated as Remarketing Agent
for such Series of VRDP Shares, with the prior written consent of the Liquidity
Provider (which consent shall not be unreasonably withheld), as set forth in
Schedule I to the Fee Agreement, and its or their permitted successors and
assigns.
“Remarketing Notice” has the meaning set forth in
paragraph (b) of Section 2 of Part II of these Articles Supplementary.
“Remarketing Procedures” means the procedures for
conducting Remarketings set forth in Part II of these Articles Supplementary.
“Requisite NRSROs” means
(i) any two NRSROs that have issued a rating with respect to a security or class
of debt obligations of an issuer, or (ii) if only one NRSRO has issued a rating
with respect to such security or class of debt obligations of an issuer at the
time a purchaser Acquires (as such term is defined in Rule 2a- 7 under the 1940
Act) the security, that NRSRO.
“S&P” means S&P Global Ratings, a Standard
& Poors Financial Services LLC business.
“Scheduled Termination Date” means, with respect to
a VRDP Shares Purchase Agreement for shares of a Series of VRDP Shares, July 2,
2020, or any succeeding date to which the term of such VRDP Shares Purchase
Agreement is extended pursuant to the terms thereof.
“SEC” means the Securities and Exchange Commission.
“Securities Act” means the U.S. Securities Act of
1933, as amended.
“Securities Depository” means The Depository Trust
Company, New York, New York, and any substitute for or successor to such
securities depository that shall maintain a book-entry system with respect to
the shares of a Series of VRDP Shares.
“SIFMA Municipal Swap Index” means on any Rate
Determination Date the Securities Industry and Financial Markets Association
Municipal Swap Index, produced and made available by Municipal Market Data as
of 3:00 p.m., New York City time, on the Rate Determination Date.
“Special Optional Tender Provisions” shall have the
meaning specified in paragraph (g) of Section 1 of Part II of these Articles
Supplementary.
“Special Rate Period,” with respect to shares of a
Series of VRDP Shares, shall have the meaning specified in paragraph (a) of
Section 4 of Part I of these Articles Supplementary.
“Special Redemption Provisions” shall have the
meaning specified in paragraph (a)(i) of Section 10 of Part I of these Articles
Supplementary.
“Subsequent Rate Period,” with respect to shares of
a Series of VRDP Shares, means the period from, and including, the first (1st)
day following the Initial Rate Period of shares of such Series to, and
including, the next Rate Determination Date for shares of such Series and any
period thereafter from, and including, the first (1st) day following a Rate
Determination Date for shares of such Series to, and including, the next
succeeding Rate Determination Date for shares of such Series; provided, however,
that if any Subsequent Rate Period is also a Special Rate Period, such term
shall mean the period commencing on the first (1st) day of such Special Rate
Period and ending on, and including, the last day of the last Dividend Period
thereof; except for Special Rate Periods, each Subsequent Rate Period will be a
Minimum Rate Period.
“Substitute LIBOR Dealer” means any LIBOR Dealer
selected by the Corporation; provided that none of such entities shall
be an existing LIBOR Dealer.
“Taxable Allocation” shall have the meaning
specified in paragraph (a) of Section 3 of Part I of these Articles
Supplementary.
“Tender” means either a Mandatory Tender or an
Optional Tender, as applicable.
“Tender and Paying Agent”
means The Bank of New York Mellon, or with the prior written consent of the
Liquidity Provider (which consent shall not be unreasonably withheld) any
successor Person, which has entered into an agreement with the Corporation to
act in such capacity as the Corporation’s tender agent, transfer agent,
registrar, dividend disbursing agent, paying agent, redemption price disbursing
agent and calculation agent in connection with the payment of regularly
scheduled dividends with respect to each Series of VRDP Shares.
“Tender and Paying Agent Agreement” means the
amended and restated tender and paying agent agreement, dated as of June 19, 2019,
between the Corporation and the Tender and Paying Agent, as amended, modified
or supplemented from time to time, or any similar agreement with a successor
tender and paying agent.
“U.S. Government Securities” means direct
obligations of the United States or of its agencies or instrumentalities that
are entitled to the full faith and credit of the United States and that, other
than United States Treasury Bills, provide for the periodic payment of interest
and the full payment of principal at maturity or call for redemption.
“Valuation Date” means, for purposes of determining
whether the Corporation is maintaining the VRDP Shares Basic Maintenance
Amount, each Friday that is a Business Day, or for any Friday that is not a
Business Day, the immediately preceding Business Day, and the Date of Original
Issue, commencing with the Date of Original Issue.
“Voting Period” shall have the meaning specified in
paragraph (b)(i) of Section 5 of Part I of these Articles Supplementary.
“VRDP Shares Basic Maintenance Amount,” as of any
Valuation Date, shall have the meaning set forth for “Basic Maintenance Amount”
in the Rating Agency Guidelines.
“VRDP Shares Basic Maintenance Cure Date,” with
respect to the failure by the Corporation to satisfy the VRDP Shares Basic
Maintenance Amount (as required by paragraph (a) of Section 7 of Part I of
these Articles Supplementary) as of a given Valuation Date, shall have the
meaning set forth in the Rating Agency Guidelines, but in no event shall it be
longer than 10 Business Days following such Valuation Date.
“VRDP Shares Basic Maintenance Report” shall have
the meaning set forth for “Basic Maintenance Report” in the Rating Agency
Guidelines.
“VRDP Shares Purchase Agreement” means the VRDP Shares
Purchase Agreement, dated as of June 19, 2019, between the Liquidity Provider
and the Tender and Paying Agent, as amended, modified or supplemented, or any
Alternate VRDP Shares Purchase Agreement.
“VRDP Shares Remarketing Agreement” means the VRDP Shares
Remarketing Agreement, dated as of June 19, 2019, between the Corporation and
the Remarketing Agent, as amended, modified or supplemented from time to time,
or any similar agreement with a successor remarketing agent.
PART I
1.
Number of Authorized Shares.
The initial number of authorized shares constituting
Series W-7 VRDP Shares is as set forth above under the title “Designation.”
2.
Dividends.
(a)
Ranking. The shares of any Series of VRDP Shares shall rank
on a parity with each other, with shares of any other Series of VRDP Shares and
with shares of any other Series of Preferred Shares as to the payment of
dividends by the Corporation.
(b)
Cumulative Cash Dividends. The Holders of shares of any
Series of VRDP Shares shall be entitled to receive, when, as and if declared by
the Board of Directors, out of funds legally available therefor in accordance
with the Charter and applicable law, cumulative cash dividends at the
Applicable Rate for shares of such Series, determined as set forth in paragraph
(e) of this Section 2, and no more (except to the extent set forth in Section 3
of Part I of these Articles Supplementary and Section 6 of Part II of these
Articles Supplementary), payable on the Dividend Payment Dates with respect to
shares of such Series determined pursuant to paragraph (d) of this Section 2.
Holders of VRDP Shares shall not be entitled to any dividend, whether payable
in cash, property or shares, in excess of full cumulative dividends, as herein
provided, on VRDP Shares. No interest, or sum of money in lieu of interest,
shall be payable in respect of any dividend payment or payments on VRDP Shares
which may be in arrears, and no additional sum of money shall be payable in
respect of such arrearage, except that the Corporation shall pay as a
supplemental dividend a Late Charge (as defined below in paragraph (e)(i)(C) of
this Section 2) on account of a Failure to Deposit, if any, in respect of each
day during the period commencing on the day a Failure to Deposit occurs through
and including the day immediately preceding the earlier of (i) the day the
Failure to Deposit is cured and (ii) the third (3rd) Business Day next
succeeding the day on which the Failure to Deposit occurred.
(c)
Dividends Cumulative from Date of Original Issue. Dividends
on shares of any Series of VRDP shares shall be declared daily and accumulate
at the Applicable Rate for shares of such Series from the Date of Original
Issue thereof.
(d)
Dividend Payment Dates and Adjustment Thereof. The Dividend
Payment Date with respect to shares of a Series of VRDP Shares shall be the
first (1st) Business Day of each calendar month; provided, however, that:
(i)
notwithstanding the foregoing, the Corporation in its discretion may
establish more frequent Dividend Payment Dates than monthly in respect of any
Minimum Rate Period, and the Dividend Payment Date for the Dividend Period
prior to the commencement of a Special Rate Period shall be the Business Day
immediately preceding the first (1st) day of such Special Rate Period; and
(ii)
notwithstanding the foregoing, the Corporation in its discretion may
establish the Dividend Payment Dates in respect of any Special Rate Period of
shares of a Series of VRDP Shares consisting of more than seven (7) Rate Period
Days; provided, however, that such dates shall be set forth in
the Notice of Proposed Special Rate Period and Notice of Special Rate Period
relating to such Special Rate Period, as delivered to the Remarketing Agent,
which Notice of Proposed Special Rate Period and Notice of Special Rate Period
shall be filed with the Secretary of the Corporation; and provided further
that (1) any such Dividend Payment Date shall be a Business Day and (2) the
last Dividend Payment Date in respect of such Special Rate Period shall be the
Business Day
immediately following the last day
thereof, as such last day is determined in accordance with paragraph (b) of
Section 4 of Part I of these Articles Supplementary.
(e)
Applicable Rates and Calculation of Dividends.
(i)
Applicable Rates. The dividend rate on shares of any Series of
VRDP Shares during the period from and after the Date of Original Issue of
shares of such Series to and including the last day of the Initial Rate Period
of shares for such Series shall be equal to the rate per annum set forth
with respect to the shares of such Series under “Designation” above. Except
for Special Rate Periods, each Subsequent Rate Period will be a Minimum Rate
Period. For each Subsequent Rate Period of shares of such Series thereafter,
the dividend rate on shares of such Series shall be equal to the rate per
annum that results from the Applicable Rate Determination for shares of
such Series on the Rate Determination Date immediately preceding such
Subsequent Rate Period; provided, however, that:
(A)
if an Applicable Rate Determination for any such Subsequent Rate Period
is not held for any reason, the dividend rate on shares of such Series for such
Subsequent Rate Period will be adjusted to the Maximum Rate for shares of such
Series on the Rate Determination Date therefor;
(B)
in the event of a Failed Remarketing Condition, the Applicable Rate as
of the close of business on the day the Failed Remarketing Condition first
occurs will be adjusted to the Maximum Rate (with the Applicable Spread subject
to adjustment as set forth in the definition of Applicable Spread), and the
Maximum Rate will continue to be the Applicable Rate (i) until the first (1st)
day of the next succeeding Subsequent Rate Period after a Failed Remarketing
Condition no longer exists in the case of a Minimum Rate Period or a Special
Rate Period of twenty-eight (28) Rate Period Days or fewer, and (ii) until the
first (1st) day of the next succeeding Dividend Period after a Failed
Remarketing Condition no longer exists in the case of a Special Rate Period of
greater than twenty-eight (28) Rate Period Days;
(C)
if any Failure to Deposit shall have occurred with respect to shares of
such Series during any Dividend Period thereof, but, prior to 12:00 noon, New
York City time, on the third (3rd) Business Day next succeeding the date on
which such Failure to Deposit occurred, such Failure to Deposit shall have been
cured in accordance with paragraph (f) of this Section 2, and the Corporation
shall have paid to the Tender and Paying Agent as a late charge (“Late Charge”)
daily supplemental dividends equal in the aggregate to the sum of(1) if such
Failure to Deposit consisted of the failure to timely pay to the Tender and
Paying Agent the full amount of dividends with respect to any Dividend Period
of the shares of such Series, an amount computed by multiplying (x) the
Applicable Rate for the Rate Period during which such Failure to Deposit occurs
on the Dividend Payment Date for such Dividend Period plus 2.00% by (y)
a fraction, the numerator of which shall be the number of days for which such
Failure to Deposit has not been cured in accordance with paragraph (f) of this
Section 2 (including the day such Failure to Deposit occurs and excluding the
day such Failure to Deposit is cured) and the denominator of which shall be
360, and applying the rate obtained against the aggregate Liquidation
Preference of the Outstanding shares of such Series (with the amount for each
individual day that such Failure to Deposit occurs or continues uncured being
declared as a supplemental dividend on that day) and (2) if such Failure to
Deposit consisted of the failure to timely pay to the Tender and Paying Agent
the Redemption Price of the shares, if any, of such Series for which Notice of
Redemption has been provided by the Corporation pursuant to paragraph (c) of
Section 10 of Part I of these Articles Supplementary, an amount computed by
multiplying, (x) for the Rate Period during which such Failure to Deposit
occurs on the Redemption Date, the Applicable Rate plus
2.00% by (y) a fraction, the numerator of which shall be
the number of days for which such Failure to Deposit is not cured in accordance
with paragraph (f) of this Section 2 (including the day such Failure to Deposit
occurs and excluding the day such Failure to Deposit is cured) and the
denominator of which shall be 360, and applying the rate obtained against the
aggregate Liquidation Preference of the Outstanding shares of such Series to be
redeemed (with the amount for each individual day that such Failure to Deposit
occurs or continues uncured being declared as a supplemental dividend on that
day), and if a Rate Determination Date occurs on the date on which such Failure
to Deposit occurred or on either of the two (2) Business Days succeeding that
date, and the Failure to Deposit has not been cured on such Rate Determination
Date in accordance with paragraph (f) of this Section 2, no Applicable Rate
Determination will be held in respect of shares of such Series for the
Subsequent Rate Period relating to such Rate Determination Date and the
dividend rate for shares of such Series for such Subsequent Rate Period will be
the Maximum Rate for shares of such Series on the Rate Determination Date for
such Subsequent Rate Period; or
(D)
if any Failure to Deposit shall have occurred with respect to shares of
such Series during any Dividend Period thereof, and, prior to 12:00 noon, New
York City time, on the third (3rd) Business Day next succeeding the date on
which such Failure to Deposit occurred, such Failure to Deposit shall not have
been cured in accordance with paragraph (f) of this Section 2 or the
Corporation shall not have paid the applicable Late Charge to the Tender and
Paying Agent, no Applicable Rate Determination will occur in respect of shares
of such Series for the first Subsequent Rate Period thereof thereafter (or for any
Subsequent Rate Period thereof thereafter to and including the Subsequent Rate
Period during which (1) such Failure to Deposit is cured in accordance with
paragraph (f) of this Section 2 and (2) the Corporation pays the applicable
Late Charge to the Tender and Paying Agent, in each case no later than 12:00
noon, New York City time, on the fourth (4th) Business Day prior to the end of
such Subsequent Rate Period), and the dividend rate for shares of such Series
for each such Subsequent Rate Period shall be a rate per annum equal to
the Maximum Rate for shares of such Series on the Rate Determination Date for
such Subsequent Rate Period (but with the prevailing rating for shares of such
Series, for purposes of determining such Maximum Rate, being deemed to be “below
‘BBB-”‘).
Each dividend rate determined in accordance with this
paragraph (e)(i) of Section 2 of Part I of these Articles Supplementary
shall be an “Applicable Rate.”
(ii)
Calculation of Dividends. The amount of dividends per share
payable on shares of a Series of VRDP Shares on any Dividend Payment Date shall
equal the sum of the dividends accumulated but not yet paid for each Rate
Period (or part thereof) in the related Dividend Period or Dividend Periods.
The amount of dividends accumulated for each such Rate Period (or part thereof)
shall be computed by multiplying the Applicable Rate in effect for shares of
such Series for such Rate Period (or part thereof) by a fraction, the numerator
of which shall be the number of days in such Rate Period (or part thereof) and
the denominator of which shall be the actual number of days in the year (365 or
366), and multiplying such product by $100,000.
(f)
Curing a Failure to Deposit. A Failure to Deposit with
respect to shares of a Series of VRDP Shares shall have been cured (if such
Failure to Deposit is not solely due to the willful failure of the Corporation
to make the required payment to the Tender and Paying Agent) with respect to
any Dividend Period of shares of such Series if, within the respective time periods
described in paragraph (e)(i) of this Section 2, the Corporation shall have
paid to the Tender and Paying Agent (A) all accumulated but unpaid dividends on
shares of such Series and (B) without duplication, the Redemption
Price for shares, if any, of such Series for which Notice
of Redemption has been provided by the Corporation pursuant to paragraph (c) of
Section 10 of Part I of these Articles Supplementary; provided, however,
that the foregoing clause (B) shall not apply to the Corporation’s failure to
pay the Redemption Price in respect of shares of a Series of VRDP Shares when
the related Notice of Redemption provides that redemption of such shares is
subject to one or more conditions precedent and any such condition precedent
shall not have been satisfied at the time or times and in the manner specified
in such Notice of Redemption.
(g)
Dividend Payments by Corporation to Tender and Paying Agent.
In connection with each Dividend Payment Date for shares of a Series of VRDP
Shares, the Corporation shall pay to the Tender and Paying Agent, not later
than 12:00 noon, New York City time, on the earlier of (A) the third (3rd)
Business Day next succeeding the Rate Determination Date immediately preceding
the Dividend Payment Date for such Series and (B) the Business Day immediately
preceding the Dividend Payment Date for such Series (or as otherwise provided
for and in connection with designation of a Special Rate Period), an aggregate
amount of Deposit Securities equal to the dividends to be paid to all Holders
of shares of such Series on such Dividend Payment Date as determined in
accordance with Section 2(e)(ii) of Part I of these Articles Supplementary, or
as otherwise provided for and in connection with designation of a Special Rate
Period. If an aggregate amount of funds equal to the dividends to be paid to
all Holders of shares of such Series on such Dividend Payment Date are not
available in New York, New York by 12:00 noon, New York City time, on the
Business Day immediately preceding such Dividend Payment Date, the Tender and
Paying Agent will notify the Liquidity Provider by Electronic Means of such
fact prior to the close of business on such day.
(h)
Tender and Paying Agent as Trustee of Dividend Payments by
Corporation. All Deposit Securities paid to the Tender and Paying
Agent for the payment of dividends (or for the payment of any Late Charge)
shall be held in trust for the payment of such dividends (and any such Late
Charge) by the Tender and Paying Agent for the benefit of the Holders specified
in paragraph (i) of this Section 2. The Tender and Paying Agent shall notify
the Corporation by Electronic Means of the amount of any funds deposited with
the Tender and Paying Agent by the Corporation for any reason under the Tender
and Paying Agent Agreement, including for the payment of dividends or the
redemption of shares of a Series of VRDP Shares (or any Late Charge), that
remain with the Tender and Paying Agent after ninety (90) days from the date of
such deposit and such amount shall, to the extent permitted by law, be repaid
to the Corporation by the Tender and Paying Agent upon request by Electronic
Means of the Corporation.
(i)
Dividends Paid to Holders. Each dividend on shares of a
Series of VRDP Shares shall be declared daily to the Holders thereof at the
close of business on each such day and paid on each Dividend Payment Date to
the Holders thereof at the close of business on the day immediately preceding
such Dividend Payment Date. In connection with any transfer of shares of a
Series of VRDP Shares, the transferor as Beneficial Owner of such shares shall
be deemed to have agreed pursuant to the terms of such Series of VRDP Shares to
transfer to the transferee the right to receive from the Corporation any
dividends declared and unpaid for each day prior to the transferee becoming the
Beneficial Owner of such VRDP Shares in exchange for payment of the Purchase
Price for such VRDP Shares by the transferee.
(j)
Dividends Credited Against Earliest Accumulated But Unpaid Dividends.
Any dividend payment made on shares of a Series of VRDP Shares that is
insufficient to cover the entire amount of dividends payable shall first be
credited against the earliest accumulated but unpaid dividends due with respect
to such shares of such Series. 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 their names appear on the record books
of the Corporation on such date, not exceeding fifteen (15) days preceding the
payment date thereof, as may be fixed by the Board of Directors.
(k)
Dividends Designated as Exempt-Interest Dividends. Dividends on
shares of a Series of VRDP Shares shall be designated as exempt-interest
dividends up to the amount of the Net Tax-Exempt Income of the Corporation, to
the extent permitted by, and for purposes of, Section 852 of the Code.
3.
Gross-Up Payments. Holders of shares of a Series of VRDP
Shares shall be entitled to receive, when, as and if declared by the Board of
Directors, out of funds legally available therefor, dividends in an amount
equal to the aggregate Gross-up Payments as follows:
(a)
If the Corporation allocates any net capital gains or ordinary income
taxable for regular federal income tax purposes to a dividend paid on shares of
a Series of VRDP Shares without either having given advance notice thereof to
the Remarketing Agent or simultaneously increasing such dividend payment by an
additional amount, both as provided in Section 6 of Part II of these Articles
Supplementary (such allocation being referred to herein as a “Taxable
Allocation”), the Corporation shall, prior to the end of the calendar year in
which such dividend was paid, provide notice thereof to the Remarketing Agent
and direct the Tender and Paying Agent to send such notice with a Gross-up
Payment to the Holder that was entitled to such dividend payment during such
calendar year at such Holder’s address as the same appears or last appeared on
the record books of the Corporation.
(b)
The Corporation shall not be required to make Gross-up Payments with
respect to any net capital gains or ordinary income determined by the Internal
Revenue Service to be allocable in a manner different from the manner used by
the Corporation.
4.
Designation of Special Rate Periods.
(a)
Length of and Preconditions for Special Rate Period. The
Corporation, at its option, with the prior written consent of the Liquidity
Provider, may designate any succeeding Subsequent Rate Period of a Series of
VRDP Shares as a Special Rate Period (a “Special Rate Period”) consisting of a
specified number of Rate Period Days evenly divisible by seven (7) and initially
not more than 1,820, subject to adjustment or extension as provided in
paragraph (b) of this Section 4. A designation of a Special Rate Period shall
be effective only with the prior written consent of the Liquidity Provider and
if (A) it is permitted by applicable law and the Charter, (B) notice thereof
shall have been given in accordance with paragraph (c) and paragraph (d)(i) of
this Section 4, (C) no shares of such Series of VRDP Shares are owned by the
Liquidity Provider pursuant to the Purchase Obligation on either the Rate
Determination Date for such proposed Special Rate Period or on the first (1st)
day of such Special Rate Period and full cumulative dividends and any amounts
due with respect to redemptions payable prior to such date have been paid in
full, and (D) if any Notice of Redemption shall have been provided by the
Corporation pursuant to paragraph (c) of Section 10 of Part I of these Articles
Supplementary with respect to any shares of such Series of VRDP Shares, the
Redemption Price with respect to such VRDP Shares shall have been deposited
with the Tender and Paying Agent. In the event the Corporation wishes to
designate any succeeding Subsequent Rate Period for shares of a Series of VRDP
Shares as a Special Rate Period consisting of more than twenty-eight (28) Rate
Period Days, the Corporation shall notify Moody’s (if Moody’s is then rating
shares of such Series of VRDP Shares at the request of the Corporation), Fitch
(if Fitch is then rating shares of such Series of VRDP Shares at the request of
the Corporation) and each Other Rating Agency (if any Other Rating Agency is
then rating shares of such Series of VRDP Shares at the request of the
Corporation) in advance of the commencement of such Subsequent Rate Period that
the Corporation wishes to designate such Subsequent Rate Period as a Special
Rate Period and shall provide Moody’s (if Moody’s is then rating shares of such
Series of VRDP Shares at the request of the Corporation), Fitch (if Fitch is
then rating shares of such Series of VRDP Shares at the request of the
Corporation) and each Other Rating Agency (if any Other Rating Agency is then
rating shares of such Series of VRDP Shares at the request of the Corporation)
with such documents as they may request.
(b)
Adjustment of Length of Special Rate Period. In the event the
Corporation wishes to designate a Subsequent Rate Period as a Special Rate
Period, but the day that would otherwise be the last day of such Special Rate
Period is not a Wednesday that is a Business Day in the case of a Series of
VRDP Shares designated as “Series W-7 Variable Rate Demand Preferred Shares”,
then the Special Rate Period shall end on the next Business Day and the
succeeding Subsequent Rate Period will end on the following Wednesday or, if
the succeeding Subsequent Rate Period is a Special Rate Period, it shall end on
a Wednesday as designated by the Corporation, subject in each case to the
foregoing Business Day requirement. A Special Rate Period designated in
accordance with this Section 4 may be extended to the extent permitted under
and in accordance with the terms of the Notice of Special Rate Period with
respect to such Special Rate Period.
(c)
Notice of Proposed Special Rate Period. If the Corporation
proposes to designate any succeeding Subsequent Rate Period for shares of a
Series of VRDP Shares as a Special Rate Period pursuant to paragraph (a) of
this Section 4, not less than twenty (20) (or such lesser number of days as may
be agreed to from time to time by the Remarketing Agent) nor more than thirty
(30) days prior to the date the Corporation proposes to designate as the first
(1st) day of such Special Rate Period (which shall be such day that would otherwise
be the first (1st) day of a Minimum Rate Period), notice (“Notice of Proposed
Special Rate Period”) shall be sent by the Corporation by first class mail,
postage prepaid or by Electronic Means, to the Holders of shares of such Series
with copies provided to the Tender and Paying Agent, the Liquidity Provider and
the Remarketing Agent. Each such notice shall state (A) that the Corporation
may exercise its option to designate a succeeding Subsequent Rate Period of
shares of such Series as a Special Rate Period, specifying the first (1st) day
thereof, (B) that the Corporation will, by 11:00 a.m., New York City time, on
the second Business Day immediately preceding such date (or by such later time
or date, or both, as may be agreed to by the Remarketing Agent) notify the
Remarketing Agent of either (x) its determination, subject to certain
conditions, to exercise such option, or (y) its determination not to exercise
such option, (C) the Rate Determination Date immediately prior to the first
(1st) day of such Special Rate Period, (D) that such Special Rate Period shall
not commence if (1) any shares of such Series of VRDP shares are owned by the
Liquidity Provider pursuant to the Purchase Obligation on either the Rate
Determination Date for such proposed Special Rate Period or on the first (1st)
day of such Special Rate Period, or (2) full cumulative dividends or any
amounts due with respect to redemptions payable prior to such Rate
Determination Date have not been paid in full, (E) the scheduled Dividend
Payment Dates for shares of such Series during such Special Rate Period, (F)
the Special Redemption Provisions, if any, applicable to shares of such Series
in respect of such Special Rate Period and (G) the Special Optional Tender
Provisions, if any, applicable to shares of such Series in respect of such
Special Rate Period.
(d)
Notice of Special Rate Period. No later than 11:00 a.m., New
York City time, on the second Business Day immediately preceding the first
(1st) day of any proposed Special Rate Period of shares of a Series of VRDP
Shares as to which notice has been given as set forth in paragraph (c) of this
Section 4 (or such later time or date, or both, as may be agreed to by the
Remarketing Agent), the Corporation shall deliver to the Remarketing Agent and
the Liquidity Provider either:
(i)
a notice (“Notice of Special Rate Period”) stating (A) that the
Corporation has determined to designate the next succeeding Rate Period of such
Series of VRDP Shares as a Special Rate Period, specifying the same and the
first (1st) day thereof, (B) the Rate Determination Date immediately prior to
the first (1st) day of such Special Rate Period, (C) the rate calculation
period to be used in determining the Applicable Rate if the term thereof is
different from the term of the Special Rate Period and any other special
provisions relating to the calculation of the Applicable Rate, including any
provision for setting the Applicable Rate by reference to any index or to the
ratings of the VRDP Shares or specifying any additional events or conditions
the existence or occurrence of which result in
adjustments to the Applicable Rate or additional fees or payments in respect of
shares of such Series of VRDP Shares (which provisions may vary provisions that
are set forth in the Charter (including the Articles Supplementary), provided
that the provisions and variations are clearly and expressly set forth in the
Notice of Special Rate Period), (D) that such Special Rate Period shall not
commence if (1) any shares of such Series of VRDP Shares are owned by the
Liquidity Provider pursuant to the Purchase Obligation on either such Rate
Determination Date or on the first (1st) day of such Special Rate Period, or
(2) full cumulative dividends or any amounts due with respect to redemptions payable
prior to such Rate Determination Date have not been paid in full, (E) the
scheduled Dividend Payment Dates for shares of such Series of VRDP Shares
during such Special Rate Period, (F) the Special Redemption Provisions, if any,
applicable to shares of such Series of VRDP Shares in respect of such Special
Rate Period, (G) the Special Optional Tender Provisions, if any, applicable to
shares of such Series of VRDP Shares in respect of such Special Rate Period
(including whether the Optional Tender provisions shall be applicable or
otherwise subject to special conditions during the Special Rate Period), (H)
the special provisions, if any, relating to the transfer of the shares of such
Series of VRDP Shares during the Special Rate Period, (I) the special provisions,
if any, related to Taxable Allocations during the Special Rate Period and any
resulting Gross-up Payments during the Special Rate Period including, but not
limited to, that Section 3 of Part I and Section 6 of Part II of these Articles
Supplementary shall have no effect during the Special Rate Period and that,
instead, alternative special provisions shall be observed during such period;
(J) the special provisions, if any, relating to the creation and termination of
the Special Rate Period including, but not limited to, any provisions relating
to the nature and scope of the obligations and rights of the Liquidity Provider
and the Remarketing Agent in connection therewith, the short-term credit
ratings of the Liquidity Provider and the short-term preferred stock ratings of
the VRDP Shares, the Remarketing of the VRDP Shares upon the termination of the
Special Rate Period, the applicability of the redemption and certain other
related provisions of the Articles Supplementary with respect to shares of such
Series of VRDP Shares held by the Liquidity Provider (whether or not in its
capacity as such) during the Special Rate Period and any rights of the
Corporation to request Holders of such Series of VRDP Shares to agree to an
extension of the Special Rate Period prior to the termination thereof and (K)
the special provisions, if any, relating to Mandatory Tender Events and
Mandatory Tenders with respect to shares of such Series of VRDP Shares during
the Special Rate Period (including whether Mandatory Tender Events and
Mandatory Tenders shall be applicable during the Special Rate Period), such
notice to be accompanied by a VRDP Shares Basic Maintenance Report showing
that, as of the third (3rd) Business Day immediately preceding such proposed
Special Rate Period, Moody’s Eligible Assets (if Moody’s is then rating such
VRDP Shares at the request of the Corporation), Fitch Eligible Assets (if Fitch
is then rating such VRDP Shares at the request of the Corporation) and Other
Rating Agency Eligible Assets (if any Other Rating Agency is then rating such
VRDP Shares at the request of the Corporation) each have an aggregate
Discounted Value at least equal to the VRDP Shares Basic Maintenance Amount as
of such Business Day (assuming for purposes of the foregoing calculation that
(a) the Maximum Rate is the Maximum Rate on such Business Day as if such
Business Day were the Rate Determination Date for the proposed Special Rate
Period, and (b) the Moody’s Discount Factors applicable to Moody’s Eligible
Assets are determined by reference to the first Exposure Period (as defined in
the Moody’s Guidelines) longer than the Exposure Period then applicable to the
Corporation, as described in the Moody’s Guidelines); or
(ii)
a notice stating that the Corporation has determined not to exercise
its option to designate a Special Rate Period of shares of such Series and that
the next succeeding Rate Period of shares of such Series shall be a Minimum
Rate Period.
For the avoidance of doubt, none of the special provisions
set forth in a Notice of Special Rate Period provided in accordance with
subparagraph (i) above shall be deemed to be amendments, alterations or the
repeal of the provisions of these Articles Supplementary requiring a vote of
the Holders of Shares pursuant to Section 5 hereof.
(e)
Failure to Deliver Notice of Special Rate Period. If the Corporation fails to
deliver either of the notices described in paragraphs (d)(i) or (d)(ii) of this
Section 4 (and, in the case of the notice described in paragraph (d)(i) of this
Section 4, a VRDP Shares Basic Maintenance Report to the effect set forth in
such paragraph (but only if Moody's, Fitch or an Other Rating Agency is then
rating the Series in question pursuant to the request of the Corporation)) with
respect to any designation of any proposed Special Rate Period to the
Remarketing Agent and the Liquidity Provider by 11:00 a.m., New York City time,
on the second Business Day immediately preceding the first (1st) day of such
proposed Special Rate Period (or by such later time or date, or both, as may be
agreed to by the Remarketing Agent and the Liquidity Provider), the Corporation
shall be deemed to have delivered a notice to the Remarketing Agent and the
Liquidity Provider with respect to such Special Rate Period to the effect set
forth in paragraph (d)(ii) of this Section 4. In the event the Corporation
delivers to the Remarketing Agent and the Liquidity Provider a notice described
in paragraph (d)(i) of this Section 4, it shall file a copy of such notice with
the Secretary of the Corporation, and the contents of such notice shall be
binding on the Corporation and the Holders and Beneficial Owners of the shares
of such Series of VRDP Shares. In the event the Corporation delivers to the
Remarketing Agent and the Liquidity Provider a notice described in paragraph
(d)(ii) of this Section 4, the Corporation will provide Moody's (if Moody's is
then rating the VRDP Shares in question pursuant to the request of the
Corporation) and Fitch (if Fitch is then rating the VRDP Shares in question
pursuant to the request of the Corporation) and each Other Rating Agency (if
any Other Rating Agency is then rating the VRDP Shares in question pursuant to
the request of the Corporation) a copy of such notice.
(f)
Termination Date. Notwithstanding the foregoing, no Special Rate
Period shall end later than the fifteenth (15th) day prior to the Scheduled
Termination Date at which point the Rate Periods shall revert to Minimum Rate
Periods.
(g)
Notice to Holders. In the event the Corporation delivers to the Remarketing
Agent and the Liquidity Provider a Notice of Special Rate Period, it shall
deliver, concurrently with the delivery thereof to the Remarketing Agent and
the Liquidity Provider, such Notice of Special Rate Period to the Holders of
the shares of the Series of VRDP Shares subject to the Special Rate Period.
During the term of the Special Rate Period, the Corporation shall provide a
copy of the Notice of Special Rate Period to (i) any Holder or Beneficial Owner
of the shares of such Series of VRDP Shares upon request and (ii) any Holder or
Beneficial Owner that is a transferee in any transfer of the shares of such
Series of VRDP Shares during the Special Rate Period promptly after receiving
the notice described below, provided the Corporation has been notified of any
such transfer and has been provided with the contact information of such Holder
or Beneficial Owner, as applicable.
(h)
Ambiguities. In the event of any conflict between the terms of the
Notice of Special Rate Period and the terms of these Articles Supplementary,
the terms of the Notice of Special Rate Period shall govern.
(i)
Amendments. A Notice of Special Rate Period may be amended
at any time during the term of the Special Rate Period to which it relates by
not less than 30 days’ notice to the Holders, the Liquidity
Provider and the Remarketing Agent, provided that any amendment that adversely
affects the rights of the Holders during such Special Rate Period shall require
the consent of the Holders of at least a majority of the VRDP Shares
Outstanding at the time. For purposes of the foregoing, except as otherwise
set forth in a Notice of Special Rate Period, no matter shall be deemed to
adversely affect any right, preference or power of the VRDP Shares or the
Holders thereof unless such matter (i) alters or abolishes the terms of any
preferential rights of such Shares, (ii) creates, alters or abolishes the terms
of any right in respect of redemption of such Shares, or (iii) creates or
alters (other than to abolish or to comply with applicable law) the terms of
any restriction on transfer applicable to such Shares, and provided further
that the notice provisions or this paragraph may be waived by Holders, the
Liquidity Provider and/or the Remarketing Agent.
5.
Voting Rights.
(a)
One Vote Per VRDP Share. Except as otherwise provided in the
Charter or as otherwise required by law, (i) each Holder of shares of a Series
of VRDP Shares shall be entitled to one vote for each such share held by such
Holder on each matter submitted to a vote of stockholders of the Corporation,
and (ii) the holders of outstanding Preferred Shares, including each share of a
Series of VRDP Shares, and of Common Shares shall vote together as a single
class; provided, however, that the holders of outstanding Preferred
Shares, including VRDP Shares, voting together as a class, to the exclusion of
the holders of all other securities and classes of stock of the Corporation,
shall be entitled to elect two directors of the Corporation at all times, each
Preferred Share, including each share of a Series of VRDP Shares, entitling the
holder thereof to one vote. Subject to paragraph (b) of this Section 5, the
holders of outstanding Common Shares and Preferred Shares, including VRDP
Shares, voting together as a single class, shall elect the balance of the
directors.
(b)
Voting for Additional Directors.
(i)
Voting Period. During any period in which any one or more of the
conditions described in subparagraphs (A) or (B) of this paragraph (b)(i) 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
exclusively by the holders of Preferred Shares, including the VRDP Shares,
would constitute a majority of the Board of Directors as so increased by such
smallest number; and the holders of Preferred Shares, including the VRDP
Shares, shall be entitled, voting together as a single class on a
one-vote-per-share basis (to the exclusion of the holders of all other
securities and classes of 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:
(A)
if at the close of business on any Dividend Payment Date accumulated
dividends (whether or not earned or declared) on any outstanding Preferred
Shares, including the VRDP Shares, equal to at least two (2) full years’
dividends shall be due and unpaid and sufficient cash or specified securities
shall not have been deposited with the Tender and Paying Agent for the payment
of such accumulated dividends; or
(B)
if at any time holders of Preferred Shares are entitled under the 1940
Act to elect a majority of the directors of the Corporation.
Upon the termination of a Voting Period, the voting rights
described in this paragraph (b)(i) shall cease, subject always, however, to the
revesting of such voting rights in the holders of Preferred Shares upon the
further occurrence of any of the events described in this paragraph (b)(i).
(ii)
Notice of Special Meeting. As soon as reasonably practicable
after the accrual of any right of the holders of Preferred Shares to elect
additional directors as described in paragraph (b)(i) of this Section 5, the
Corporation may call a special meeting of such holders, such call to be made by
notice as provided in the bylaws of the Corporation, such meeting to be held
not less than ten (10) nor more than sixty (60) days after the date of mailing
of such notice. If a special meeting is not called by the Corporation, 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
not more than sixty (60) nor less than ten (10) days prior to the date of such
special meeting. At any such special meeting and at each meeting of holders of
Preferred Shares held during a Voting Period at which directors are to be elected,
such holders, voting together as a class (to the exclusion of the holders of
all other securities and classes of stock of the Corporation), shall be
entitled to elect the number of directors prescribed in paragraph (b)(i) of
this Section 5 on a one-vote-per-share basis.
(iii)
Terms of Office of Existing Directors. 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 Shares to elect directors
shall continue, notwithstanding the election at such meeting by the Holders and
such other holders of other Preferred Shares of the number of directors that
they are entitled to elect, and the persons so elected by the Holders and such
other holders of other Preferred Shares, together with the two incumbent
directors elected by the Holders and such other holders of other Preferred
Shares and the remaining incumbent directors elected by the holders of the
Common Shares and Preferred Shares, shall constitute the duly elected directors
of the Corporation.
(iv)
Terms of Office of Certain Directors to Terminate Upon Termination of
Voting Period. Simultaneously with the termination of a Voting Period, the
terms of office of the additional directors elected by the Holders and holders
of other Preferred Shares pursuant to paragraph (b)(i) of this Section 5 shall
terminate, the remaining directors shall constitute the directors of the
Corporation and the voting rights of the Holders and such other holders to
elect additional directors pursuant to paragraph (b)(i) of this Section 5 shall
cease, subject to the provisions of the last sentence of paragraph (b)(i) of
this Section 5.
(c)
Holders of VRDP Shares to Vote on Certain Other Matters.
(i)
Increases in Capitalization and Certain Amendments. So long as
shares of any Series of VRDP Shares are Outstanding, the Corporation shall not,
without the affirmative vote or consent of the Holders of at least a majority
of the VRDP Shares Outstanding at the time, in person or by proxy, either in
writing or at a meeting, voting as a separate class: (a) authorize, create or
issue any class or series of shares ranking prior to or on a parity with the
VRDP Shares with respect to the payment of dividends or the distribution of
assets upon dissolution, liquidation or winding up of the affairs of the
Corporation, or authorize, create or issue additional shares of any Series of
VRDP Shares (except that, notwithstanding the foregoing, but subject to certain
Rating Agency approvals, the Board of Directors, without the vote or consent of
the Holders, may with the prior written consent of the Liquidity Provider from
time to time authorize and create, and the Corporation may from time to time
issue additional shares of, any Series of VRDP Shares or classes or series of
Preferred Shares ranking on a parity with the VRDP Shares with respect to the
payment of dividends and the distribution of assets upon dissolution,
liquidation or winding up of the affairs of the Corporation), or (b) amend,
alter or repeal
the provisions of the Charter, including
these Articles Supplementary, whether by merger, consolidation or otherwise, so
as to adversely affect any preference, right or power of such VRDP Shares or
the Holders thereof set forth in the Charter, including these Articles
Supplementary; provided, however, that (i) none of the actions
permitted by the exception to clause (a) above will be deemed to affect such
preferences, rights or powers, (ii) a division of a VRDP Share will be deemed
to affect such preferences, rights or powers only if the terms of such division
adversely affect the Holders of the VRDP Shares and (iii) the authorization,
creation and issuance of classes or series of shares ranking junior to VRDP
Shares with respect to the payment of dividends and the distribution of assets
upon dissolution, liquidation or winding up of the affairs of the Corporation
will be deemed to affect such preferences, rights or powers only if such
issuance would, at the time thereof, cause the Corporation not to satisfy the
Minimum VRDP Shares Asset Coverage or, if Moody’s, Fitch or any Other Rating
Agency is then rating shares of a Series of VRDP Shares at the request of the
Corporation, the VRDP Shares Basic Maintenance Amount. For purposes of the
foregoing, except as otherwise set forth in these Articles Supplementary, no
matter shall be deemed to adversely affect any right, preference or power of a
Series of VRDP Shares or the Holders thereof unless such matter (i) alters or
abolishes the terms of any preferential rights of such Series, (ii) creates,
alters or abolishes the terms of any right in respect of redemption of such
Series, or (iii) creates or alters (other than to abolish or to comply with
applicable law) the terms of any restriction on transfer applicable to such
Series. So long as any shares of any Series of VRDP Shares are Outstanding,
the Corporation will not, without the affirmative vote or consent of the
Holders of at least 662/3% of
the VRDP Shares Outstanding at the time, in person or by proxy, either in
writing or at a meeting, voting as a separate class, file a voluntary
application 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. If any action set forth above would adversely affect the
rights of one or more Series (the “Affected Series”) of VRDP Shares in a manner
different from any other Series of VRDP Shares, the Corporation will not
approve any such action without the affirmative vote or consent of the Holders
of at least a majority of the shares of each such Affected Series Outstanding
at the time, in person or by proxy, either in writing or at a meeting (each
such Affected Series voting as a separate class).
(ii)
1940 Act Matters. Unless a higher percentage is provided for in
the Charter, (A) the affirmative vote of the holders of at least a “majority of
the outstanding Preferred Shares,” including VRDP Shares Outstanding at the
time, voting as a separate class, shall be required to approve any conversion
of the Corporation from a closed-end to an open-end investment company and (B)
the affirmative vote of the holders of a “majority of the outstanding Preferred
Shares,” including VRDP Shares Outstanding at the time, voting as a separate
class, shall be required to approve any plan of reorganization (as such term is
used in the 1940 Act) adversely affecting such shares. The affirmative vote of
the holders of a “majority of the outstanding Preferred Shares,” including VRDP
Shares Outstanding at the time, voting as a separate class, shall be required
to approve any action not described in the first sentence of this Section
5(c)(ii) requiring a vote of security holders of the Corporation under Section
13(a) of the 1940 Act. For purposes of the foregoing, “majority of the
outstanding Preferred Shares” means (i) 67% or more of such shares present at a
meeting, if the Holders of more than 50% of such shares are present or
represented by proxy, or (ii) more than 50% of such shares, whichever is less.
In the event a vote of Holders of VRDP Shares is required pursuant to the
provisions of Section 13(a) of the 1940 Act, the Corporation shall, not later
than ten (10) Business Days prior to the date on which such vote is to be
taken, notify Moody’s (if Moody’s is then rating
the
VRDP Shares at the request of the Corporation), Fitch (if Fitch is then rating
the VRDP Shares at the request of the Corporation) and each Other Rating Agency
(if any Other Rating Agency is then rating the VRDP Shares at the request of
the Corporation) that such vote is to be taken and the nature of the action
with respect to which such vote is to be taken.
(iii)
Exclusive Right to Vote on Certain Charter Amendments.
Notwithstanding the foregoing, and except as otherwise required by the 1940
Act, (i) Holders of Outstanding shares of a Series of VRDP Shares will be
entitled as a Series, to the exclusion of the holders of all other securities,
including other Preferred Shares, Common Shares and other classes of capital
stock of the Corporation, to vote on matters affecting shares of such Series of
VRDP Shares that do not adversely affect any of the rights of holders of such
other securities, including other Preferred Shares, Common Shares and other
classes of capital stock, as expressly set forth in the Charter, and (ii)
Holders of Outstanding shares of a Series of VRDP Shares will not be entitled
to vote on matters affecting any other Preferred Shares that do not adversely
affect any of the rights of Holders of such Series of VRDP Shares, as expressly
set forth in the Charter.
(d)
Board of Directors May Take Certain Actions Without Stockholder
Approval. The Corporation is not required to maintain any particular
preferred stock ratings for a Series of VRDP Shares and the Board of Directors
may, subject to this Section 5(d), at any time, terminate the services of a
Rating Agency then providing a rating for such Series with or without
replacement, in either case, without the approval of Holders of shares of such
Series of VRDP Shares or other stockholders of the Corporation. The
Corporation is required to comply with the Rating Agency Provisions of a Rating
Agency only if such Rating Agency is then rating a Series of VRDP Shares at the
request of the Corporation.
(i)
Notwithstanding anything herein to the contrary (including without
limitation clause (ii) below), the Board of Directors, without the approval of
Holders of shares of any Series of VRDP Shares or other stockholders of the
Corporation, may terminate the services of any Rating Agency then providing a
rating for a Series of VRDP Shares and replace it with another Rating Agency, provided
that the Corporation provides seven (7) days’ notice by Electronic Means to
Holders prior to terminating the services of a Rating Agency and replacing it
with another Rating Agency. In the event a Rating Agency ceases to furnish a
preferred stock rating or the Corporation terminates a Rating Agency with replacement
in accordance with this clause (i), the Corporation shall no longer be required
to comply with the Rating Agency Provisions of the Rating Agency so terminated
and, as applicable, the Corporation shall be required to thereafter comply with
the Rating Agency Provisions of each Rating Agency then providing a rating for
a Series of VRDP Shares at the request of the Corporation.
(ii)
(A) Notwithstanding anything herein to the contrary (including without
limitation clause (i) above), the Board of Directors, without the approval of
Holders of shares of any Series of VRDP Shares or other stockholders of the
Corporation, may terminate the services of any Rating Agency then providing a
rating for a Series of VRDP Shares without replacement, provided that
(I) the Corporation has given the Remarketing Agent, the Tender and Paying
Agent, and the Liquidity Provider, and Moody’s, Fitch and each Other Rating
Agency, as applicable, and Holders of shares of such Series of VRDP Shares at
least forty-five (45) calendar days’ advance written notice of such termination
of services, (II) the Corporation is in compliance with the Moody’s Provisions,
the Fitch Provisions and the Other Rating Agency 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 services, and (III)
shares of such Series of VRDP Shares continue to be rated by at least one NRSRO
at and after the time of the termination of services.
(B)(B) On the
date that the notice is given as described in the preceding clause (A) and on
the date that the services of Moody’s, Fitch or any Other Rating Agency, as
applicable, are terminated, the Corporation shall provide the Tender and Paying
Agent and Moody’s, Fitch and each Other Rating Agency, as applicable, with an
officers’ certificate as to the compliance with the provisions of the preceding
clause (A), and, on such later date and thereafter, the Corporation shall no
longer be required to comply with the Rating Agency Provisions of the Rating
Agency whose services were terminated.
(iii)
Notwithstanding anything herein to the contrary, but subject to this
Section 5(d), the Rating Agency Guidelines, as they may be amended from time to
time by the respective Rating Agency, will be reflected in a written document
and may be amended by the respective Rating Agency without the vote, consent or
approval of the Corporation, the Board of Directors or any holder of Preferred
Shares, including any Series of VRDP Shares, or any other stockholder of the
Corporation. The Board of Directors, without the vote or consent of any holder
of Preferred Shares, including any Series of VRDP Shares, or any other
stockholder of the Corporation, may from time to time take such actions as may
be reasonably required in connection with obtaining, maintaining or changing
the rating of any Rating Agency that is then rating shares of a Series of VRDP
Shares at the request of the Corporation, and any such action will not be
deemed to affect the preferences, rights or powers of Preferred Shares,
including VRDP Shares, or the Holders thereof, provided that the Board
of Directors receives written confirmation from such Rating Agency, as
applicable, then rating such shares of a Series of VRDP Shares at the request
of the Corporation (with such confirmation in no event being required to be
obtained from a particular Rating Agency with respect to definitions or other
provisions relevant only to and adopted in connection with another Rating
Agency’s rating of any Series of VRDP Shares) that any such action would not
adversely affect the rating then assigned by such Rating Agency.
(iv)
Notwithstanding the foregoing, nothing in this Section 5 is intended in
any way to limit the ability of (A) the Corporation to make certain adjustments
in the VRDP Shares Remarketing Agreement as provided under the definition of “Maximum
Rate,” subject to the limitations set forth in such definition, or (B) the
Board of Directors to, subject to applicable law, amend or alter any provisions
of these Articles Supplementary, without the vote or consent of any holder of
Preferred Shares, including any Series of VRDP Shares, or any other stockholder
of the Corporation, as otherwise provided in these Articles Supplementary.
(e)
Voting Rights Set Forth Herein are Sole Voting Rights.
Unless otherwise required by law, the Holders of VRDP Shares shall not have any
relative rights or preferences or other special rights other than those
specifically set forth herein.
(f)
No Preemptive Rights or Cumulative Voting. The Holders of
VRDP Shares shall have no preemptive rights or rights to cumulative voting.
(g)
Voting for Directors Sole Remedy for Corporation’s Failure to Pay
Dividends. In the event that the Corporation fails to pay any
dividends on shares of a Series of VRDP Shares, the exclusive
remedy of the Holders of such Series shall be the right
to vote for directors pursuant to the provisions of this Section 5.
(h)
Holders Entitled to Vote. For purposes of determining any
rights of the Holders to vote on any matter, whether such right is created by
these Articles Supplementary, by the other provisions of the Charter, by
statute or otherwise by applicable law, no Holder shall be entitled to vote any
VRDP Shares and no VRDP Shares shall be deemed to be “Outstanding” for the
purpose of voting or determining the number of shares required to constitute a
quorum if, prior to or concurrently with the time of determination of the VRDP
Shares entitled to vote or the VRDP Shares deemed Outstanding for quorum
purposes, as the case may be, the requisite Notice of Redemption with respect
to such VRDP Shares shall have been provided as set forth in paragraph (c) of
Section 10 of Part I of these Articles Supplementary and Deposit Securities in
an amount equal to the Redemption Price for the redemption of such VRDP Shares
shall have been deposited in trust with the Tender and Paying Agent and
segregated on the books and records of the Custodian for that purpose. VRDP
Shares held (legally or beneficially) by the Corporation or any affiliate of
the Corporation or otherwise controlled by the Corporation shall not have any
voting rights or be deemed to be Outstanding for voting or for calculating the
voting percentage required on any other matter or other purposes.
(i)
Grant of Irrevocable Proxy. To the fullest extent permitted by applicable
law, each Holder and Beneficial Owner may in its discretion grant an
irrevocable proxy.
6.
Minimum VRDP Shares Asset Coverage. The Corporation shall
maintain, as of the last Business Day of each month in which any VRDP Share is
Outstanding, the Minimum VRDP Shares Asset Coverage.
7.
VRDP Shares Basic Maintenance Amount.
(a)
So long as any VRDP Share is Outstanding, the Corporation shall
maintain, on each Valuation Date, and shall verify to its satisfaction that it
is maintaining on such Valuation Date, (i) Moody’s Eligible Assets having an
aggregate Discounted Value equal to or greater than the VRDP Shares Basic
Maintenance Amount (if Moody’s is then rating the VRDP Shares at the request of
the Corporation), (ii) Fitch Eligible Assets having an aggregate Discounted
Value equal to or greater than the VRDP Shares Basic Maintenance Amount (if
Fitch is then rating the VRDP Shares at the request of the Corporation), and
(iii) Other Rating Agency Eligible Assets having an aggregate Discounted Value
equal to or greater than the VRDP Shares Basic Maintenance Amount (if any Other
Rating Agency is then rating the VRDP Shares at the request of the
Corporation).
(b)
The Corporation shall deliver to each Rating Agency which is then rating
a Series of VRDP Shares at the request of the Corporation and any other party
specified in the Rating Agency Guidelines all certificates that are set forth
in the respective Rating Agency Guidelines regarding Minimum VRDP Shares Asset
Coverage, VRDP Shares Basic Maintenance Amount and/or related calculations at
such times and containing such information as set forth in the respective
Rating Agency Guidelines (each, a “Rating Agency Certificate”). A failure by
the Corporation to deliver a Rating Agency Certificate with respect to the VRDP
Shares Basic Maintenance Amount shall be deemed to be delivery of a Rating
Agency Certificate indicating the Discounted Value for all assets of the
Corporation is less than the VRDP Shares Basic Maintenance Amount, as of the
relevant Valuation Date; provided, however, that the Corporation
shall have the ability to cure such failure to deliver a Rating Agency
Certificate within one day of receipt of notice from such Rating Agency that,
without limiting paragraph (a) above or modifying the VRDP Shares Basic
Maintenance Cure Date, the Corporation failed to deliver such Rating Agency
Certificate.
8.
Restrictions on Dividends and Other Distributions.
(a)
Dividends on Preferred Shares Other Than VRDP Shares. Except
as set forth in the next sentence, no dividends shall be declared or paid or
set apart for payment on the shares of any class or Series of stock of the
Corporation ranking, as to the payment of dividends, on a parity with the VRDP
Shares for any period unless full cumulative dividends have been or
contemporaneously are declared and paid on the shares of each Series of VRDP
Shares through its most recent Dividend Payment Date. When dividends are not
paid in full upon the shares of each Series of VRDP Shares through its most
recent Dividend Payment Date or upon the shares of any other class or series of
stock of the Corporation ranking on a parity as to the payment of dividends
with the VRDP Shares through their most recent respective dividend payment
dates, all dividends declared upon the VRDP Shares and any other such class or
series of stock ranking on a parity as to the payment of dividends with the
VRDP Shares shall be declared pro rata so that the amount of dividends declared
per share on the VRDP Shares and such other class or series of stock shall in
all cases bear to each other the same ratio that accumulated dividends per
share on the VRDP Shares and such other class or series of stock bear to each
other (for purposes of this sentence, the amount of dividends declared per VRDP
Share shall be based on the Applicable Rate for such VRDP Share effective
during the Dividend Periods during which dividends were not paid in full).
(b)
Dividends and Other Distributions With Respect to Common Shares Under
the 1940 Act. The Board of Directors shall not declare any dividend
(except a dividend payable in Common Shares), or declare any other
distribution, upon the Common Shares, or purchase Common Shares, unless in
every such case the Preferred Shares have, at the time of any such declaration
or purchase, an asset coverage (as defined in and determined pursuant to the
1940 Act) of at least 200% (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 shares or stock of a closed-end investment company as a
condition of declaring dividends on its common shares or stock) after deducting
the amount of such dividend, distribution or purchase price, as the case may
be.
(c)
Other Restrictions on Dividends and Other Distributions. For
so long as any VRDP Share is Outstanding, and except as set forth in paragraph
(a) of this Section 8 and paragraph (c) of Section 11 of this Part I, (A) the
Corporation shall not declare, pay or set apart for payment any dividend or
other distribution (other than a dividend or distribution paid in shares of, or
in options, warrants or rights to subscribe for or purchase, Common Shares or
other shares, if any, ranking junior to the VRDP Shares as to the payment of dividends
and the distribution of assets upon dissolution, liquidation or winding up) in
respect of the Common Shares or any other shares of the Corporation ranking
junior to or on a parity with the VRDP Shares as to the payment of dividends or
the distribution of assets upon dissolution, liquidation or winding up, or call
for redemption, redeem, purchase or otherwise acquire for consideration any
Common Shares or any other such junior shares (except by conversion into or
exchange for shares of the Corporation ranking junior to the VRDP Shares as to
the payment of dividends and the distribution of assets upon dissolution,
liquidation or winding up), or any such parity shares (except by conversion
into or exchange for shares of the Corporation ranking junior to or on a parity
with VRDP Shares as to the payment of dividends and the distribution of assets
upon dissolution, liquidation or winding up), unless (i) full cumulative
dividends on shares of each Series of VRDP Shares through its most recently
ended Dividend Period shall have been paid or shall have been declared and
sufficient funds for the payment thereof deposited with the Tender and Paying
Agent and (ii) the Corporation has redeemed the full number of VRDP Shares
required to be redeemed by any provision for mandatory redemption pertaining
thereto, and (B) the Corporation shall not declare, pay or set apart for
payment any dividend or other distribution (other than a dividend or
distribution paid in shares of, or in options, warrants or rights to subscribe for
or purchase, Common Shares or other shares, if any, ranking junior to VRDP
Shares as to the payment of dividends and the distribution of assets upon
dissolution, liquidation or winding up) in respect of Common Shares or any
other shares of the Corporation ranking junior to
VRDP
Shares as to the payment of dividends or the distribution of assets upon
dissolution, liquidation or winding up, or call for redemption, redeem,
purchase or otherwise acquire for consideration any Common Shares or any other
such junior shares (except by conversion into or exchange for shares of the
Corporation ranking junior to VRDP Shares as to the payment of dividends and
the distribution of assets upon dissolution, liquidation or winding up), unless
immediately after such transaction the Discounted Value of Moody’s Eligible
Assets (if Moody’s is then rating the VRDP Shares at the request of the
Corporation), Fitch Eligible Assets (if Fitch is then rating the VRDP Shares at
the request of the Corporation) and Other Rating Agency Eligible Assets (if any
Other Rating Agency is then rating the VRDP Shares at the request of the
Corporation) would each at least equal the Basic Maintenance Amount for such
Series.
9.
Rating Agency Restrictions. For so long as any shares of any
Series of VRDP Shares is Outstanding and any Rating Agency is then rating a
Series of VRDP Shares at the request of the Corporation, the Corporation will
not engage in certain proscribed transactions set forth in the Rating Agency
Guidelines, unless it has received written confirmation from each such Rating
Agency that proscribes the applicable transaction in its Rating Agency
Guidelines that any such action would not impair the rating then assigned by
such Rating Agency to a Series of VRDP Shares.
10.
Redemption.
(a)
Optional Redemption.
(i)
Subject to the provisions of subparagraph (iv) of this paragraph (a),
shares of any Series of VRDP Shares may be redeemed, at the option of the
Corporation, at any time, as a whole or from time to time in part, out of funds
legally available therefor and otherwise in accordance with applicable state
law, at a redemption price per share equal to the sum of $100,000 plus
an amount equal to accumulated but unpaid dividends thereon (whether or not
earned or declared) to, but not including, the date fixed for redemption; provided,
however, that (1) shares of a Series of VRDP Shares may not be redeemed
in part if after such partial redemption fewer than fifty (50) shares of such
Series would remain Outstanding; (2) shares of a Series of VRDP Shares are not
redeemable by the Corporation during the Initial Rate Period; and (3) subject
to subparagraph (ii) of this paragraph (a), the Notice of Special Rate Period
relating to a Special Rate Period of shares of a Series of VRDP Shares, as
delivered to the Remarketing Agent and filed with the Secretary of the
Corporation, may provide that shares of such Series shall not be redeemable
during the whole or any part of such Special Rate Period or shall be redeemable
during the whole or any part of such Special Rate Period only upon payment of
such redemption premium or premiums as shall be specified therein (“Special
Redemption Provisions”).
(ii)
A Notice of Special Rate Period relating to shares of a Series of VRDP
Shares for a Special Rate Period thereof may contain Special Redemption
Provisions only if the Corporation’s Board of Directors, after consultation
with the Remarketing Agent and the Liquidity Provider, determines that such
Special Redemption Provisions are in the best interest of the Corporation.
(iii)
If fewer than all of the Outstanding shares of a Series of VRDP Shares
are to be redeemed pursuant to subparagraph (i) of this paragraph (a), the
number of shares of such Series to be redeemed shall be selected either pro
rata from the Holders of shares of such Series in proportion to the number of
shares of such Series held by such Holders or by lot or in such manner as the
Corporation’s Board of Directors may determine to be fair and
equitable. The Corporation’s Board of Directors will
have the full power and authority to prescribe the terms and conditions upon
which shares of a Series of VRDP Shares will be redeemed from time to time.
(iv)
The Corporation may not on any date send a Notice of Redemption pursuant
to paragraph (c) of this Section 10 in respect of a redemption contemplated to
be effected pursuant to this paragraph (a) unless on such date (a) the
Corporation has available Deposit Securities with maturity or tender dates not
later than the day preceding the applicable redemption date and having a Market
Value not less than the amount (including any applicable premium) due to
Holders by reason of the redemption of shares of a Series of VRDP Shares on
such redemption date and (b) the Discounted Value of Moody’s Eligible Assets
(if Moody’s is then rating the shares of a Series of VRDP Shares at the request
of the Corporation), the Discounted Value of Fitch Eligible Assets (if Fitch is
then rating the shares of a Series of VRDP Shares at the request of the
Corporation) and the Discounted Value of Other Rating Agency Eligible Assets
(if any Other Rating Agency is then rating the shares of a Series of VRDP
Shares at the request of the Corporation) each at least equals the VRDP Shares
Basic Maintenance Amount, and would at least equal the VRDP Shares Basic
Maintenance Amount immediately subsequent to such redemption if such redemption
were to occur on such date. For purposes of determining in clause (b) of the
preceding sentence whether the Discounted Value of Moody’s Eligible Assets at
least equals the VRDP Shares Basic Maintenance Amount, the Moody’s Discount
Factors applicable to Moody’s Eligible Assets shall be determined by reference
to the first Exposure Period (as defined in the Moody’s Guidelines) longer than
the Exposure Period then applicable to the Corporation, as described in the
definition of Moody’s Discount Factor herein.
(b)
Mandatory Redemption. (i)(i)
The Corporation shall redeem, out of funds legally available therefor and
otherwise in accordance with state law, all Outstanding Series W-7 VRDP Shares
on June 1, 2041, at a redemption price equal to $100,000 per share plus
accumulated but unpaid dividends thereon (whether or not earned or declared)
to, but excluding, such date: provided, however, that if such
date is not a Business Day, the redemption shall occur on the next succeeding
Business Day, at a redemption price equal to $100,000 per share plus
accumulated but unpaid dividends thereon (whether or not earned or declared)
to, but excluding, June 1, 2041. The Corporation also shall redeem, out of
funds legally available therefor and otherwise in accordance with state law, at
a redemption price equal to $100,000 per share plus accumulated but
unpaid dividends thereon (whether or not earned or declared) to, but excluding,
the date fixed by the Board of Directors for redemption, certain of the shares
of a Series of VRDP Shares, if the Corporation fails to have either Moody’s
Eligible Assets (if Moody’s is then rating the shares of a Series of VRDP
Shares at the request of the Corporation) with a Discounted Value, Fitch
Eligible Assets (if Fitch is then rating the shares of a Series of VRDP Shares
at the request of the Corporation) with a Discounted Value, or Other Rating
Agency Eligible Assets (if any Other Rating Agency is then rating the shares of
a Series of VRDP Shares at the request of the Corporation) with a Discounted
Value greater than or equal to the VRDP Shares Basic Maintenance Amount, or fails
to maintain the Minimum VRDP Shares Asset Coverage in accordance with these
Articles Supplementary, and such failure is not cured on or before the VRDP
Shares Basic Maintenance Cure Date or the Minimum VRDP Shares Asset Coverage
Cure Date, as the case may be. In the event of failure by the Corporation to
have Rating Agency Eligible Assets with a Discounted Value greater than or
equal to the VRDP Shares Basic Maintenance Amount, if then applicable, the
Corporation may seek to cure such failure on or prior to the VRDP Shares Basic
Maintenance Cure Date by complying with the requirements of the Rating Agency
or Rating Agencies, if any, then rating shares of such Series of VRDP Shares at
the request of the Corporation as in effect at the time of such failure. The
number of VRDP Shares to be redeemed shall be equal to the lesser of (A) the
minimum number of VRDP Shares, together with all
other
Preferred Shares subject to redemption or retirement, the redemption of which,
if deemed to have occurred immediately prior to the opening of business on the
applicable Cure Date, would result in the Corporation’s having each of Moody’s
Eligible Assets (if Moody’s is then rating shares of a Series of VRDP Shares at
the request of the Corporation) with a Discounted Value, Fitch Eligible Assets
(if Fitch is then rating shares of a Series of VRDP Shares at the request of
the Corporation) with a Discounted Value and Other Rating Agency Eligible
Assets (if any Other Rating Agency is then rating shares of a Series of VRDP
Shares at the request of the Corporation) with a Discounted Value greater than
or equal to the VRDP Shares Basic Maintenance Amount or maintaining the Minimum
VRDP Shares Asset Coverage, as the case may be, on the applicable Cure Date (provided,
however, that if there is no such minimum number of VRDP Shares and
other Preferred Shares the redemption or retirement of which would have such
result, all VRDP Shares and Preferred Shares then outstanding shall be
redeemed), and (B) the maximum number of VRDP Shares, together with all other
Preferred Shares subject to redemption or retirement, that can be redeemed out
of funds legally available therefor in accordance with the Charter and
applicable law. In determining the VRDP Shares required to be redeemed in
accordance with the foregoing, the Corporation shall allocate the number
required to be redeemed to satisfy the VRDP Shares Basic Maintenance Amount or
the Minimum VRDP Shares Asset Coverage, as the case may be, pro rata among VRDP
Shares and other Preferred Shares (and, then, pro rata among each Series of
VRDP Shares) subject to redemption or retirement. The Corporation shall effect
such redemption on the date fixed by the Corporation therefor, which date shall
not be earlier than ten (10) days nor later than sixty (60) days after the
applicable Cure Date, except that if the Corporation does not have funds
legally available for the redemption of all of the required number of VRDP
Shares and other Preferred Shares which are subject to redemption or retirement
or the Corporation otherwise is unable as a result of applicable law to effect
such redemption on or prior to sixty (60) days after the applicable Cure Date,
the Corporation shall redeem those VRDP Shares and other Preferred Shares which
it was unable to redeem on the earliest practicable date on which it is able to
effect such redemption. Except in the case of a Failed Remarketing
Condition-Purchased VRDP Shares Redemption, as described below, if fewer than
all of the Outstanding shares of a Series of VRDP Shares are to be redeemed
pursuant to this paragraph (b), the number of shares of a Series of VRDP Shares
to be redeemed shall be redeemed pro rata, by lot or other fair method as
determined by the Corporation’s Board of Directors from the Holders of VRDP Shares
in proportion to the number of shares of such Series of VRDP Shares held by
such Holders.
(ii)
(A) In accordance with these Articles Supplementary and if then required
pursuant to the Fee Agreement, if the Liquidity Provider acquires any VRDP
Shares pursuant to the Purchase Obligation, including without limitation,
pursuant to Section 2.02(r) of the VRDP Shares Purchase Agreement, and
continues to be the beneficial owner for federal income tax purposes of such
Purchased VRDP Shares for a continuous period of six (6) months during which
such Purchased VRDP Shares are tendered for Remarketing on each Business Day in
accordance with the Related Documents but cannot be successfully remarketed
(i.e., a Failed Remarketing Condition-Purchased VRDP Shares shall have
occurred and be continuing for such period of time with respect to such
Purchased VRDP Shares), the Corporation shall effect a Failed Remarketing
Condition-Purchased VRDP Shares Redemption out of funds legally available for
the redemption of the Purchased VRDP Shares that are subject to the Failed
Remarketing Condition-Purchased VRDP Shares Redemption and in accordance with
any other applicable law restrictions that apply to redemptions of stock;
provided, that, as of the date of redemption: (i) to the extent any VRDP Shares
are Outstanding and held by Persons other than the Liquidity Provider, the
Purchase Obligation of the Liquidity Provider whose VRDP Shares are subject to
the Failed Remarketing Condition-Purchased VRDP Shares Redemption remains in
effect to the extent required by, and in accordance with, the VRDP Shares
Purchase Agreement to which such Liquidity Provider is a party, and (ii) to the
extent (a) any VRDP Shares are Outstanding and held by Persons other than the
Liquidity Provider
and (b) the Purchase Obligation of
the Liquidity Provider whose VRDP Shares are subject to the Failed Remarketing
Condition-Purchased VRDP Shares Redemption remains in effect to the extent
required by, and in accordance with, the VRDP Shares Purchase Agreement to
which such Liquidity Provider is a party, the Liquidity Provider whose VRDP
Shares are subject to the Failed Remarketing Condition-Purchased VRDP Shares
Redemption shall have made written affirmation to the Corporation not later
than the Business Day immediately preceding the Redemption Date to the effect
that the Liquidity Provider is in compliance with the Purchase Obligation in
accordance with its terms. Notwithstanding the foregoing proviso, any failure
or delay by the Liquidity Provider whose VRDP Shares are subject to the Failed
Remarketing Condition-Purchased VRDP Shares Redemption to deliver the
affirmation referred to in the foregoing proviso shall not relieve the
Corporation of its obligation to effectuate a Failed Remarketing Condition-Purchased
VRDP Shares Redemption and shall only result in a delay by the Corporation to
effectuate a Failed Remarketing Condition-Purchased VRDP Shares Redemption
until one (1) Business Day following the date that such Liquidity Provider
delivers such affirmation or such affirmation is no longer required. The
six-month holding period for Purchased VRDP Shares acquired and continuously
held as a result of a continuing Failed Remarketing Condition-Purchased VRDP
Shares shall be determined by the Corporation on a first-in, first-out basis.
The Corporation shall effect a Failed Remarketing Condition-Purchased VRDP
Shares Redemption on the Redemption Date fixed by the Corporation therefor,
which date shall not be later than three (3) Business Days after the expiration
of the six month period, except that if the Corporation does not have legally
available funds for the redemption of all of the required number of Purchased
VRDP Shares which are subject to the Failed Remarketing Condition-Purchased
VRDP Shares Redemption or the Corporation otherwise is unable as a result of
applicable law restrictions that apply to redemptions of stock to effect such
redemption on or prior to three (3) Business Days after the expiration of the
six-month period, the Corporation shall redeem those Purchased VRDP Shares
which it was unable to redeem on the earliest practicable date on which it is
able to effect such redemption out of legally available funds and in accordance
with applicable law restrictions that apply to redemptions of stock.
(B)(B) Upon the
occurrence and continuance of a Failed Remarketing Condition-Purchased VRDP
Shares with respect to any VRDP Shares (including any deemed occurrence thereof
pursuant to Section 2.02(r) of the VRDP Shares Purchase Agreement), by the
fifth (5th) Business Day following delivery of notice thereof from the
Liquidity Provider in accordance with Section 7.08(c) of the Fee Agreement, the
Corporation shall cause the Custodian to segregate, by means of appropriate
identification on its books and records or otherwise in accordance with the
Custodian’s normal procedures, from the other assets of the Corporation (a “Liquidity
Account”) Liquidity Account Investments with a Market Value equal to at least
110% of the Liquidation Preference of such Purchased VRDP Shares. If, while
the Failed Remarketing Condition-Purchased VRDP Shares with respect to such
Purchased VRDP Shares is continuing, the aggregate Market Value of the
Liquidity Account Investments included in the Liquidity Account for such
Purchased VRDP Shares as of the close of business on any Business Day is less
than 110% of the Liquidation Preference of such Purchased VRDP Shares, then the
Corporation shall cause the Custodian and the Investment Adviser to take all
such necessary action, including segregating additional assets of the
Corporation as Liquidity Account Investments, so that the aggregate Market
Value of the Liquidity Account Investments included in the Liquidity Account
for such Purchased VRDP Shares is at least equal to 110% of the Liquidation
Preference of such Purchased VRDP Shares not later than the close of business on the next succeeding Business Day. With respect
to assets of the Corporation segregated as Liquidity Account Investments, the
Investment Adviser, on behalf of the Corporation, shall be entitled to instruct
the Custodian with a copy to the Liquidity Provider on any date to release any
Liquidity Account Investments with respect to any Purchased VRDP Shares from
such segregation and to substitute therefor other Liquidity Account
Investments, so long as (x) the assets of the Corporation segregated as
Liquidity Account Investments with respect to such Purchased VRDP Shares at the
close of business on such date have a Market Value equal to 110% of the
Liquidation Preference of such Purchased VRDP Shares and (y) the assets of the
Corporation designated and segregated as Deposit Securities at the close of business
on such date have a Market Value equal to the Liquidity Requirement (if any)
determined in accordance with paragraph (C) below with respect to such
Purchased VRDP Shares for such date. The Corporation shall cause the Custodian
not to permit any lien, security interest or encumbrance to be created or
permitted to exist on or in respect of any Liquidity Account Investments
included in the Liquidity Account for any Purchased VRDP Shares, other than
liens, security interests or encumbrances arising by operation of law and any
lien of the Custodian with respect to the payment of its fees or repayment for
its advances. Notwithstanding anything expressed or implied herein to the
contrary, the assets of the Liquidity Account shall continue to be assets of the
Corporation subject to the interests of all creditors and stockholders of the
Corporation.
(C)(C) Subject to
notice having been received as referred to in paragraph (B) above, the Market
Value of the Deposit Securities held in the Liquidity Account for any Purchased
VRDP Shares, from and after the day (or if such day is not a Business Day, the
next succeeding Business Day) preceding the expiration of the six-month period
for the Failed Remarketing Condition-Purchased VRDP Shares applicable to such
Purchased VRDP Shares (which, for the avoidance of doubt, may result in
multiple six month periods, each in respect of a Failed Remarketing
Condition-Purchased VRDP Shares in respect of applicable Purchased VRDP Shares)
specified in the table set forth below, shall not be less than the percentage
of the Liquidation Preference for such Purchased VRDP Shares set forth below
opposite such day (the “Liquidity Requirement”), but in all cases subject to
the cure provisions of paragraph (D) below:
Number of Days*
Preceding the Six Month Anniversary of Liquidity Provider’s Purchase
|
Value of Deposit Securities
as Percentage of
Liquidation Preference
|
135
|
20%
|
105
|
40%
|
75
|
60%
|
45
|
80%
|
15
|
100%
|
_____________
* Or if such day is not a Business Day, the next succeeding
Business Day
(D)(D) If the
aggregate Market Value of the Deposit Securities included in the Liquidity
Account for any Purchased VRDP Shares as of the close of business on any
Business Day is less than the Liquidity Requirement in respect of such
Purchased VRDP Shares for such Business Day, then the Corporation shall cause
the segregation of additional or substitute Deposit Securities in respect of
the Liquidity Account for such Purchased VRDP Shares, so that the aggregate
Market Value of the Deposit Securities included in the
Liquidity Account for such Purchased VRDP Shares is at least equal to the
Liquidity Requirement for such Purchased VRDP Shares not later than the close
of business on the next succeeding Business Day.
(E)(E) The
Deposit Securities included in the Liquidity Account for any Purchased VRDP
Shares may be applied by the Corporation, in its discretion, towards payment of
the Redemption Price for such Purchased VRDP Shares. Upon the earlier to occur
of (x) the successful remarketing of the Purchased VRDP Shares or (y) the
deposit by the Corporation with the Tender and Paying Agent with arrangements
satisfactory to the Liquidity Provider of Deposit Securities having an initial
combined Market Value sufficient to effect the redemption of such Purchased
VRDP Shares on the Redemption Date for such Purchased VRDP Shares, the
requirement of the Corporation to maintain a Liquidity Account for such
Purchased VRDP Shares as contemplated by this Section 10(b)(ii) shall lapse and
be of no further force and effect.
(F)(F) The
provisions of paragraphs (A) through (E) of this Section 10(b)(ii) may be
amended by the Board of Directors, by resolution duly adopted, without
stockholder approval in order to conform to the terms of a Fee Agreement or as
otherwise necessary or desirable in the judgment of the Board of Directors, provided
that the Board of Directors receives the prior written consent of the Liquidity
Provider and written confirmation from each Rating Agency, as applicable, then
rating shares of a Series of VRDP Shares at the request of the Corporation that
any such amendments would not adversely affect the rating then assigned by such
Rating Agency to such Series of VRDP Shares.
(iii)
At least six (6) months prior to the scheduled mandatory Redemption Date
of June 1, 2041 specified in Section 10(b)(i) above, if any Series W-7 VRDP
Shares then remain Outstanding, the Corporation shall cause the Custodian to
segregate in a Liquidity Account (but without duplication of any Liquidity
Account then in effect pursuant to Section 10(b)(ii) above), by means of
appropriate identification on its books and records or otherwise in accordance
with the Custodian’s normal procedures, from the other assets of the
Corporation, Liquidity Account Investments with a Market Value equal to at
least 110% of the Liquidation Preference of the then Outstanding Series W-7
VRDP Shares. The Corporation shall maintain such Liquidity Account in
accordance with Section 10(b)(ii)(B), (C) and (D) above and comply with the
requirements set forth therein with respect to Liquidity Account Investments
and the Liquidity Requirement; provided, that for purposes of this
Section 10(b)(iii) all references therein to Purchased VRDP Shares shall be
deemed to be to all Outstanding Series W-7 VRDP Shares, all references therein
to the Failed Remarketing Condition-Purchased VRDP Shares or the related
six-month period shall be deemed to be to the six-month period preceding the
scheduled mandatory Redemption Date of June 1, 2041, and the references to
notice by the Liquidity Provider shall not be applicable. The Deposit
Securities included in the Liquidity Account for the Outstanding Series W-7
VRDP Shares may be applied by the Corporation, in its discretion, towards
payment of the Redemption Price for the Outstanding Series W-7 VRDP Shares.
Upon the deposit by the Corporation with the Tender and Paying Agent with
arrangements satisfactory to the Liquidity Provider of Deposit Securities
having an initial combined Market Value sufficient to effect the redemption of
the Outstanding Series W-7 VRDP Shares on June 1, 2041 Redemption Date for the
Outstanding Series W-7 VRDP Shares, the requirement of the Corporation to
maintain a Liquidity Account for the Outstanding Series W-7 VRDP Shares as
contemplated by this Section 10(b)(iii) shall lapse and be of no further force
and effect.
(c)
Notice of Redemption. If the Corporation shall determine or be
required to redeem, in whole or in part, shares of a Series of VRDP Shares pursuant
to paragraph (a) or (b)(i) of this Section 10, the Corporation will send a
notice of redemption (the “Notice of Redemption”), by Electronic Means (or by
first-class mail, postage prepaid, in the case where the shares of such Series
of VRDP Shares are in physical form outside the book-entry system of the
Securities Depository), to Holders thereof and the Liquidity Provider or, in
the case of a redemption pursuant to paragraph (b)(ii) of this Section 10, only
to the Liquidity Provider, or request the Tender and Paying Agent, on behalf of
the Corporation to promptly do so by Electronic Means (or by first-class mail,
postage prepaid, in the case where the shares of such Series of VRDP Shares are
in physical form outside the book-entry system of the Securities Depository) so
long as the Notice of Redemption is furnished by the Corporation to the Tender
and Paying Agent in electronic format at least five (5) Business Days prior to
the date a Notice of Redemption is required to be delivered to the Holders, unless
a shorter period of time shall be acceptable to the Tender and Paying Agent. A
Notice of Redemption shall be sent to Holders not less than ten (10) days prior
to the date fixed for redemption in such Notice of Redemption (the “Redemption
Date”). Each such Notice of Redemption shall state: (i) the Redemption Date;
(ii) the number of shares of such Series of VRDP Shares to be redeemed and the
Series thereof; (iii) the CUSIP number for the VRDP Shares of such Series; (iv)
the Redemption Price; (v) the place or places where the certificate(s), if any,
for such shares (properly endorsed or assigned for transfer, if the Board of
Directors requires and the Notice of Redemption states) are to be surrendered
for payment of the Redemption Price; (vi) that dividends on the shares of such
Series of VRDP Shares to be redeemed will cease to accumulate from and after
such Redemption Date; and (vii) the provisions of these Articles Supplementary
under which such redemption is made. If fewer than all shares of a Series of
VRDP Shares held by any Holder are to be redeemed, the Notice of Redemption
delivered to such Holder shall also specify the number of shares of such Series
of VRDP Shares to be redeemed from such Holder. The Corporation may provide in
any Notice of Redemption relating to a redemption contemplated to be effected
pursuant to these Articles Supplementary that such redemption is subject to one
or more conditions precedent and that the Corporation shall not be required to
effect such redemption unless each such condition has been satisfied at the
time or times and in the manner specified in such Notice of Redemption. No
defect in the Notice of Redemption or delivery thereof shall affect the
validity of redemption proceedings, except as required by applicable law.
(d)
No Redemption Under Certain Circumstances. Notwithstanding
the provisions of paragraphs (a) or (b) of this Section 10, if any dividends on
shares of a Series of VRDP Shares (whether or not earned or declared) are in
arrears, no shares of such Series shall be redeemed unless all Outstanding
shares of such Series are simultaneously redeemed, and the Corporation shall
not otherwise purchase or acquire any shares of such Series; provided, however,
that the foregoing shall not prevent the purchase or acquisition of Outstanding
shares of a Series of VRDP Shares pursuant to the successful completion of an
otherwise lawful purchase or exchange offer made on the same terms to Holders
of all Outstanding shares of such Series of VRDP Shares.
(e)
Absence of Funds Available for Redemption. To the extent
that any redemption for which a Notice of Redemption has been provided is not
made by reason of the absence of legally available funds therefor in accordance
with the Charter and applicable law, such redemption shall be made as soon as
practicable to the extent such funds become available. A failure to redeem
shares of a Series of VRDP Shares shall be deemed to exist at any time after
the date specified for redemption in a Notice of Redemption when the Corporation
shall have failed, for any reason whatsoever, to deposit in trust with the
Tender and Paying Agent the Redemption Price with respect to any shares for
which such Notice of Redemption has been sent; provided, however,
that the foregoing shall not apply in the case of the Corporation’s failure to
deposit in trust with the Tender and Paying Agent the Redemption Price with
respect to any shares where (1) the Notice of Redemption relating to such
redemption, provided that such redemption was subject to one or more
conditions precedent, and (2) any such condition precedent shall not have been
satisfied at the time or times and in the manner specified in such Notice of
Redemption.
Notwithstanding the fact that the
Corporation may not have redeemed shares of a Series of VRDP Shares for which a
Notice of Redemption has been provided, dividends may be declared and paid on
shares of a Series of VRDP Shares and shall include those shares of such Series
of VRDP Shares for which a Notice of Redemption has been provided.
(f)
Tender and Paying Agent as Trustee of Redemption Payments by
Corporation. All moneys paid to the Tender and Paying Agent for
payment of the Redemption Price of shares of a Series of VRDP Shares called for
redemption shall be held in trust by the Tender and Paying Agent for the
benefit of Holders of shares so to be redeemed.
(g)
Shares for Which Notice of Redemption Has Been Given Are No Longer
Outstanding. Provided a Notice of Redemption has been provided
pursuant to paragraph (c) of this Section 10, the Corporation shall irrevocably
(except to the extent set forth below in this paragraph (g)) deposit with the
Tender and Paying Agent, no later than 12:00 noon, New York City time, on a
Business Day not less than ten (10) Business Days preceding the redemption date
specified in such notice, Deposit Securities in an aggregate amount equal to
the Redemption Price to be paid on the Redemption Date in respect of any shares
of a Series of VRDP Shares that are subject to such notice. Provided a Notice
of Redemption has been provided pursuant to paragraph (c) of this Section 10,
upon the deposit with the Tender and Paying Agent of Deposit Securities in an
amount sufficient to redeem the shares of a Series of VRDP Shares that are the
subject of such notice, dividends on such shares of a Series of VRDP Shares
shall cease to accumulate and such shares of a Series of VRDP Shares shall no
longer be deemed to be Outstanding, except as noted below with respect to the
VRDP Shares Purchase Agreement, for any purpose, and all rights of the Holders
of the shares of a Series of VRDP Shares so called for redemption shall cease
and terminate, except the right of such Holders to receive the Redemption
Price, but without any interest or other additional amount, except as provided
in paragraph (e)(i) of Section 2 of this Part I and in Section 3 of Part I of
these Articles Supplementary. Upon surrender in accordance with the Notice of
Redemption of the certificates for any shares of a Series of VRDP Shares so
redeemed (properly endorsed or assigned for transfer, if the Board of Directors
shall so require and the Notice of Redemption shall so state), the Redemption
Price shall be paid by the Tender and Paying Agent to the Holders of shares of
a Series of VRDP Shares subject to redemption. In the case that fewer than all
of the shares represented by any such certificate are redeemed, a new
certificate shall be issued, representing the unredeemed shares, without cost
to the Holder thereof. The Corporation shall be entitled to receive from the
Tender and Paying Agent, promptly after the date fixed for redemption, any cash
or other Deposit Securities deposited with the Tender and Paying Agent in
excess of (i) the aggregate Redemption Price of the shares of a Series of VRDP
Shares called for redemption on such date and (ii) all other amounts to which
Holders of shares of a Series of VRDP Shares called for redemption may be
entitled. Any funds so deposited that are unclaimed at the end of ninety (90)
days from such redemption date shall, to the extent permitted by law, be repaid
to the Corporation, after which time the Holders of shares of a Series of VRDP
Shares so called for redemption may look only to the Corporation for payment of
the Redemption Price and all other amounts to which they may be entitled. The
Corporation shall be entitled to receive, from time to time after the date
fixed for redemption, any interest on the funds so deposited. Notwithstanding
the foregoing, shares of a Series of VRDP Shares will be deemed to be
Outstanding for purposes of the VRDP Shares Purchase Agreement until redeemed
by the Corporation.
(h)
Compliance With Applicable Law. In effecting any redemption
pursuant to this Section 10, the Corporation shall use its best efforts to
comply with all applicable conditions precedent to effecting such redemption
under the 1940 Act and any applicable Maryland or other state law, but shall
effect no redemption except in accordance with the 1940 Act and any applicable
Maryland or other state law.
(i)
Only Whole Shares of a Series of VRDP Shares May Be Redeemed. In
the case of any redemption pursuant to this Section 10, only whole shares of a
Series of VRDP Shares shall be redeemed, and in the event that any provision of
the Charter would require redemption of a fractional share, the Remarketing
Agent shall be authorized to round up so that only whole shares are redeemed.
(j)
Modification of Redemption Procedures. Notwithstanding the
foregoing provisions of this Section 10, the Corporation may, in its sole
discretion, modify the procedures set forth above with respect to notification
of redemption of VRDP Shares, provided that such modification does not
materially and adversely affect the Holders of VRDP Shares or cause the
Corporation to violate any law, rule or regulation, or to in any way alter the
obligations of the Tender and Paying Agent without its prior written consent.
Furthermore, if in the sole discretion of the Board of Directors, after
consultation with counsel, modification of the foregoing redemption provisions
(x) are permissible under the rules and regulations or interpretations of the
SEC and under other applicable law and (y) would not cause a material risk as
to the treatment of the VRDP Shares as equity for U.S. federal income tax
purposes, the Board of Directors, without stockholder approval, by resolution
and with the prior written consent of the Liquidity Provider may modify such
redemption procedures.
11.
Liquidation Rights.
(a)
Ranking. The shares of a Series of VRDP Shares shall rank on
a parity with each other, with shares of any other Series of VRDP Shares and
with shares of any other Series of Preferred Shares as to the distribution of
assets upon dissolution, liquidation or winding up of the affairs of the
Corporation.
(b)
Distributions Upon Liquidation. Upon the dissolution,
liquidation or winding up of the affairs of the Corporation, whether voluntary
or involuntary, the Holders of VRDP Shares then Outstanding shall be entitled
to receive and to be paid out of the assets of the Corporation available for
distribution to its stockholders and otherwise in accordance with applicable
state law, before any payment or distribution shall be made on the Common
Shares or on any other class of shares of the Corporation ranking junior to the
VRDP Shares upon dissolution, liquidation or winding up, an amount equal to the
Liquidation Preference with respect to such shares plus an amount equal
to all dividends thereon (whether or not earned or declared) accumulated but
unpaid to (but not including) the date of final distribution in same day funds,
together with any payments required to be made pursuant to Section 3 of Part I
of these Articles Supplementary in connection with the liquidation of the
Corporation. After the payment to the Holders of VRDP Shares of the full
preferential amounts provided for in this paragraph (b), the Holders of VRDP
Shares as such shall have no right or claim to any of the remaining assets of
the Corporation.
(c)
Pro Rata Distributions. In the event the assets of the
Corporation available for distribution to the Holders of VRDP Shares upon any
dissolution, liquidation or winding up of the affairs of the Corporation,
whether voluntary or involuntary, shall be insufficient to pay in full all
amounts to which such Holders are entitled pursuant to paragraph (b) of this
Section 11, no such distribution shall be made on account of any shares of any
other class or Series of Preferred Shares ranking on a parity with the VRDP
Shares with respect to the distribution of assets upon such dissolution,
liquidation or winding up unless proportionate distributive amounts shall be
paid on account of the VRDP Shares, ratably, in proportion to the full
distributable amounts for which holders of all such parity shares are
respectively entitled upon such dissolution, liquidation or winding up.
(d)
Rights of Junior Shares. Subject to the rights of the
holders of shares of any series or class or classes of shares ranking on a
parity with the VRDP Shares with respect to the distribution of assets upon
dissolution, liquidation or winding up of the affairs of the Corporation, after
payment shall have been made in full to the Holders of VRDP Shares as provided
in paragraph (b) of this Section 11, but not prior thereto, any other series or
class or classes of shares ranking junior to the VRDP Shares with
respect to the distribution of assets upon dissolution,
liquidation or winding up of the affairs of the Corporation shall, subject to
the respective terms and provisions (if any) applying thereto, be entitled to
receive any and all assets remaining to be paid or distributed, and the Holders
of VRDP Shares shall not be entitled to share therein.
(e)
Certain Events Not Constituting Liquidation. Neither the
sale of all or substantially all the property or business of the Corporation,
nor the merger, consolidation or reorganization of the Corporation into or with
any business or statutory trust, corporation or other entity nor the merger,
consolidation or reorganization of any business or statutory trust, corporation
or other entity into or with the Corporation shall be a dissolution,
liquidation or winding up, whether voluntary or involuntary, for the purposes
of this Section 11.
12.
Purchase Obligation. As long as shares of any Series of VRDP
Shares are Outstanding, the Corporation shall maintain a VRDP Shares Purchase
Agreement providing for a Purchase Obligation with a Liquidity Provider with
short-term debt ratings in one of the two highest ratings categories from the
Requisite NRSROs on an ongoing basis to the extent that the Corporation can do
so on a commercially reasonable basis as determined in the sole discretion of
the Board of Directors. If the Corporation maintains a VRDP Shares Purchase
Agreement providing a Purchase Obligation, the provisions herein relating to
the Liquidity Provider shall be operative and the following shall apply:
(a)
The Corporation shall notify, or cause the Tender and Paying Agent to
notify, Holders by Electronic Means, or by first-class mail, postage prepaid,
in the case in which shares of a Series of VRDP Shares are in physical form outside
the book-entry system of the Securities Depository, (A) in the event of a
Mandatory Tender Event or Mandatory Purchase Event, (B) upon at least seven (7)
days’ prior notice in the event that there is a substitute Liquidity Provider
(including, but not limited to, as to the Liquidity Provider, its
consolidation, amalgamation with, or merger with or into, another entity, or
the transfer of all or substantially all of the Liquidity Provider’s assets to
another entity), or (C) any downgrade in the rating of the Series of VRDP
Shares or the Liquidity Provider by an NRSRO then rating shares of such Series
of VRDP Shares at the request of the Corporation or Liquidity Provider.
(b)
In the event of a Failed Remarketing Condition, the Corporation will
require in the Tender and Paying Agent Agreement that the Tender and Paying
Agent will notify the Corporation and Holders by telephone or Electronic Means (or
by first-class-mail, postage prepaid, in the case in which shares of a Series
of VRDP Shares are in physical form outside the book-entry system of the
Securities Depository) of such Failed Remarketing Condition.
(c)
Each share of a Series of VRDP Shares shall be subject to tender to the
Tender and Paying Agent for Remarketing on the related Purchase Date or, in the
event (i) no Remarketing occurs or (ii) pursuant to an attempted Remarketing
shares remain unsold and the Remarketing Agent does not purchase for its own
account the unsold shares of a Series of VRDP Shares tendered to the Tender and
Paying Agent for Remarketing (provided that the Remarketing Agent may
seek to sell such shares of a Series of VRDP Shares in a subsequent Remarketing
prior to the Purchase Date) to the Liquidity Provider for purchase on such
Purchase Date pursuant to a Notice of Purchase. If there is no Tender and
Paying Agent or the Tender and Paying Agent does not perform such obligation
pursuant to the VRDP Shares Purchase Agreement, Beneficial Owners and their
Agent Members shall have the right to tender their shares of a Series of VRDP
Shares directly to the Liquidity Provider pursuant to a Final Notice of
Purchase. In the event there is no Tender and Paying Agent or for any reason
the Tender and Paying Agent does not perform its obligations under the VRDP
Shares Purchase Agreement, the Corporation (i) upon becoming aware thereof,
shall promptly notify the Liquidity Provider, the Remarketing Agent and Holders
by Electronic Means of such event, and (ii) so long as such event is
continuing, shall use its best efforts to direct the Remarketing Agent to
forward, concurrently with the delivery thereof to the Liquidity
Provider or as promptly as practicable thereafter, any
Remarketing Notice to each Beneficial Owner or Holder tendering shares of the
Series of VRDP Shares that are the subject of such notice.
(d)
The Corporation will require in the Tender and Paying Agent Agreement
that, pursuant to a Tender, shares of a Series of VRDP Shares that are not sold
in a Remarketing will be tendered by the Tender and Paying Agent to the
Liquidity Provider for payment of the Purchase Price on the Purchase Date
pursuant to the VRDP Shares Purchase Agreement.
(e)
Except as set forth in Section 10(b) of Part I of these Articles Supplementary
in connection with a mandatory redemption of shares of a Series of VRDP Shares,
the Corporation shall have no obligation to purchase shares of a Series of VRDP
Shares acquired by the Liquidity Provider pursuant to the VRDP Shares Purchase
Agreement or otherwise.
(f)
Shares of a Series of VRDP Shares are subject to Mandatory Purchase by
the Liquidity Provider upon the occurrence of a Mandatory Purchase Event. So
long as shares of such Series of VRDP Shares are in book-entry form and held
through the Securities Depository, any Mandatory Purchase will be effected
automatically through the book-entry system of the Securities Depository,
without any action required on the part of the Holders or Beneficial Owners.
Promptly following the occurrence of a Mandatory Purchase Event, and in any
event within three (3) Business Days thereafter, the Corporation, or the Tender
and Paying Agent at the direction of the Corporation (provided, that the
Tender and Paying Agent may require up to two (2) Business Days prior
notification by Electronic Means by the Corporation), shall provide a Mandatory
Purchase Notice by Electronic Means to Holders and the Liquidity Provider,
specifying a Mandatory Purchase Date for all Outstanding shares of such Series
of VRDP Shares. The Mandatory Purchase Date shall not be later than seven (7)
days following the date a Mandatory Purchase Notice is sent to Holders by
Electronic Means, and in any event shall be not later than the Business Day
immediately preceding the termination of the VRDP Shares Purchase Agreement.
Any notice given in respect of a Mandatory Purchase under these Articles
Supplementary shall be conclusively presumed to have been duly given, whether
or not the Holders receive such notice. Upon the occurrence of a Mandatory
Purchase Event, all Outstanding shares of a Series of VRDP Shares automatically
shall be subject to Mandatory Purchase by the Liquidity Provider at the
Purchase Price on the Mandatory Purchase Date, including any shares of such
Series of VRDP Shares tendered pursuant to an Optional Tender or Mandatory
Tender for which the Purchase Date has not yet occurred.
(g)
In the event shares of a Series of VRDP Shares are issued in
certificated form outside the book-entry system of the Securities Depository and
a Holder fails to deliver such shares of such Series of VRDP Shares to which a
Mandatory Purchase relates, on or prior to the Mandatory Purchase Date, the
Holder of shares of such Series of VRDP Shares shall not be entitled to any
payment (including any accumulated but unpaid dividends thereon, whether or not
earned or declared) other than the Purchase Price of such undelivered VRDP
Shares as of the scheduled Purchase Date. Any such undelivered shares of a
Series of VRDP Shares will be deemed to be delivered to the Tender and Paying
Agent, and the Tender and Paying Agent will place stop-transfer orders against
the undelivered shares of such Series of VRDP Shares. Any moneys held by the
Tender and Paying Agent for the purchase of undelivered shares of such Series of
VRDP Shares shall be held in a separate account, shall not be invested, and
shall be held for the exclusive benefit of the Holder of such undelivered
shares of such Series of VRDP Shares. The undelivered shares of a Series of
VRDP Shares shall be deemed to be no longer Outstanding (except as to
entitlement to payment of the Purchase Price), and the Corporation will issue
to the purchaser replacement share certificates for such shares in lieu of such
undelivered shares of such Series of VRDP Shares.
(h)
The Corporation shall use best efforts to engage at all times a Tender
and Paying Agent to perform the duties specified in these Articles
Supplementary, the Tender and Paying Agent Agreement and the VRDP Shares
Purchase Agreement with respect to the Tender and Paying Agent.
The provisions of paragraphs (a) through (g) of this
Section 12 may be amended by the Board of Directors, by resolution duly
adopted, without stockholder approval in order to conform to a VRDP Shares
Purchase Agreement providing a Purchase Obligation.
13.
Miscellaneous.
(a)
Amendment of or Supplements to these Articles Supplementary.
Subject to the provisions of Section 9 of Part I of these Articles
Supplementary, the Board of Directors may, by resolution duly adopted, without
stockholder approval (except as otherwise provided by these Articles
Supplementary or required by applicable law), amend or supplement these
Articles Supplementary to (1) reflect any amendments or supplements hereto
which the Board of Directors is entitled to adopt pursuant to the terms of
these Articles Supplementary without stockholder approval or (2) designate
additional Series of VRDP Shares (and terms relating thereto). Each such
additional Series shall be governed by the terms of these Articles
Supplementary as so amended or supplemented.
(b)
No Fractional Shares. No fractional shares of a Series of
VRDP Shares shall be issued.
(c)
Status of VRDP Shares Redeemed, Exchanged or Otherwise Acquired by
the Corporation. Shares of a Series of VRDP shares which are redeemed,
exchanged or otherwise acquired by the Corporation shall return to the status
of authorized and unissued Preferred Shares without designation as to series, provided,
however, that any shares of a Series of VRDP Shares which are
provisionally delivered by the Corporation to or for the account of an agent of
the Corporation or to or for the account of a purchaser of the shares of the
Series of VRDP Shares, but for which final payment is not received by the
Corporation, shall return to the status of authorized and unissued shares of
such Series of VRDP Shares.
(d)
Purchase Obligation Part of the VRDP Shares. Each Holder and
Beneficial Owner, by virtue of acquiring shares of a Series of VRDP Shares, is
deemed to have agreed to treat the Purchase Obligation as part of the VRDP Shares
rather than as a separate property right.
(e)
Treatment of VRDP Shares as Equity. Each Holder and
Beneficial Owner, by virtue of acquiring shares of a Series of VRDP Shares, is
deemed to have agreed to treat the VRDP Shares as equity in the Corporation for
U.S. federal income tax purposes.
(f)
Board of Directors May Resolve Ambiguities. To the extent
permitted by applicable law, the Board of Directors may interpret or adjust the
provisions of these Articles Supplementary to resolve any inconsistency or ambiguity
or to remedy any formal defect, and may amend these Articles Supplementary with
respect to VRDP Shares prior to the issuance of such VRDP Shares.
(g)
Headings Not Determinative. The headings contained in these
Articles Supplementary are for convenience of reference only and shall not
affect the meaning or interpretation of these Articles Supplementary.
(h)
Notices. All notices or communications, unless otherwise
specified in the Bylaws of the Corporation or these Articles Supplementary,
shall be sufficiently given if in writing and delivered in person, by
Electronic Means or mailed by first-class mail, postage prepaid.
PART II
1.
Remarketing Procedures.
(a)
Pursuant to an Optional Tender, Beneficial Owners may elect to tender
their VRDP Shares (in denominations equal to the Liquidation Preference) for
purchase at the Purchase Price on the Purchase Date designated in a Notice of
Tender (or, if such day is not a Business Day, on the next succeeding Business
Day) by a proper delivery of a Notice of Tender to the Tender and Paying
Agent. Each Notice of Tender shall be irrevocable (except as described below)
and effective upon receipt by the Tender and Paying Agent and shall:
(i)
be delivered by a Beneficial Owner, directly or through its Agent
Member, by email transmission (or if email transmission shall be unavailable,
by facsimile transmission), to the Tender and Paying Agent not later than 2:00
p.m., New York City time, on any Business Day;
(ii)
state the series and the aggregate number of VRDP Shares to be
purchased, the CUSIP number of the Series of VRDP Shares to be purchased, and
the Purchase Date and be in substantially the form of and contain such other
information specified in an exhibit to the VRDP Shares Purchase Agreement; and
(iii)
state that the tendering Beneficial Owner acknowledges that such
Beneficial Owner is required to deliver the VRDP Shares that are the subject of
a Notice of Tender (that has not been duly revoked as provided below) on or
before 2:00 p.m., New York City time, on the Purchase Date.
(b)
Upon receipt of a Notice of Tender, the Tender and Paying Agent shall
provide a copy of such notice to the Liquidity Provider and the Remarketing
Agent (with a copy to the Corporation) as promptly as practicable by Electronic
Means, but no later than 4:00 p.m., New York City time, on the date of receipt
or deemed receipt.
(c)
Any Notice of Tender delivered to the Tender and Paying Agent by a
Beneficial Owner or its Agent Member after 2:00 p.m., New York City time, shall
be deemed to have been received by the Tender and Paying Agent on the next
succeeding Business Day, and the Purchase Date shall be adjusted such that the
Purchase Date shall be the Business Day next succeeding the date specified as
the Purchase Date in the Notice of Tender.
(d)
The determination of the Tender and Paying Agent as to whether a Notice
of Tender has been properly delivered pursuant to the foregoing paragraph (a)
shall be conclusive and binding upon the Beneficial Owner and its Agent Member.
(e)
(i) Shares of a Series of VRDP Shares are subject to Mandatory Tender
upon the occurrence of a Mandatory Tender Event.
(ii)
So long as the shares of a Series of VRDP Shares are in book-entry form
and held through the Securities Depository, any Mandatory Tender will be
effected automatically through the book-entry system of the Securities
Depository, without any action required on the part of the Holders or
Beneficial Owners. Promptly following the occurrence of a Mandatory Tender
Event, and in any event within three (3) Business Days thereafter, the
Corporation, or the Tender and Paying Agent at the direction of the Corporation
(provided, that the Tender and Paying Agent may require up to two (2)
Business Days
prior notification by Electronic Means
by the Corporation), shall provide a Mandatory Tender Notice by Electronic
Means to Holders, the Remarketing Agent and the Liquidity Provider, specifying
a Purchase Date for all Outstanding shares of such Series of VRDP Shares. Any
notice given in respect of a Mandatory Tender under these Articles
Supplementary will be conclusively presumed to have been duly given, whether or
not the Holders receive such notice.
(iii)
Upon the occurrence of a Mandatory Tender Event, all Outstanding shares
of a Series of VRDP Shares automatically shall be subject to Mandatory Tender
and delivered to the Tender and Paying Agent for purchase on the designated
Purchase Date by purchasers in the Remarketing in the event of a successful
Remarketing or otherwise by the Liquidity Provider, including any shares of
such Series of VRDP Shares previously tendered pursuant to an Optional Tender
for which the Purchase Date has not yet occurred. In the event that shares of
a Series of VRDP Shares are issued in certificated form outside the book-entry
system of the Securities Depository and a Holder of shares of such Series of
VRDP Shares fails to deliver such shares to which a Mandatory Tender relates on
or prior to the Purchase Date, the Holder of shares of such Series of VRDP
Shares shall not be entitled to any payment (including any accumulated but
unpaid dividends thereon, whether or not earned or declared) other than the
Purchase Price of such undelivered shares of such Series of VRDP Shares as of
the scheduled Purchase Date. Any such undelivered shares of such Series of
VRDP Shares will be deemed to be delivered to the Tender and Paying Agent, and
the Tender and Paying Agent will place stop-transfer orders against the
undelivered shares of such Series of VRDP Shares. Any moneys held by the
Tender and Paying Agent for the purchase of undelivered shares of a Series of
VRDP Shares will be held in a separate account by the Tender and Paying Agent,
will not be invested, and will be held for the exclusive benefit of the Holder
of such undelivered shares of such Series of VRDP Shares. The undelivered
shares of a Series of VRDP Shares will be deemed to be no longer Outstanding
(except as to entitlement to payment of the Purchase Price), and the
Corporation will issue to the purchaser replacement share certificates in lieu
of such undelivered shares of such Series of VRDP Shares.
(f)
A Beneficial Owner or its Agent Member that delivered a Notice of Tender
in connection with an Optional Tender may deliver in writing by email
transmission (or if email transmission shall be unavailable, by facsimile
transmission) to the Tender and Paying Agent, not later than 10:00 a.m., New
York City time, on or prior to the Business Day immediately preceding the
Purchase Date, a notice to the effect that such Beneficial Owner wishes to
revoke its election to tender some or all of the shares of a Series of VRDP
Shares that were specified in such Notice of Tender to be purchased (a “Notice
of Revocation”). Any Notice of Revocation delivered to the Tender and Paying
Agent shall be promptly delivered by Electronic Means by the Tender and Paying
Agent to the Liquidity Provider and the Remarketing Agent (with a copy to the
Corporation) by 12:00 noon, New York City time, on the Business Day immediately
preceding the relevant Purchase Date. The Remarketing Agent (following receipt
of such Notice of Revocation) shall notify the Tender and Paying Agent and the
Liquidity Provider of the number of shares of such Series of VRDP Shares
specified in such Notice of Revocation that are subject to an agreement of sale
pursuant to a Remarketing by Electronic Means not later than 2:00 p.m., New
York City time, on the Business Day immediately preceding the Purchase Date. The
Tender and Paying Agent shall contact the Remarketing Agent by Electronic Means
by 1:45 p.m., New York City time, if such notification has not been received by
such time. The Tender and Paying Agent shall deliver such notification to the
Beneficial Owner or its Agent Member promptly following receipt from the
Remarketing Agent, and in any event by 4:00 p.m., New York City time, on the
Business Day immediately preceding the Purchase Date. Any such Notice of
Revocation shall be effective (without further action on the part of the
Beneficial Owner or its Agent Member) as a revocation of the Optional
Tender of the number of shares of such Series of VRDP
Shares specified therein as being sought to be revoked, but (except as set
forth below) only if and to the extent that the Remarketing Agent has not
entered into an agreement to sell shares of such Series of VRDP Shares. A
Notice of Revocation shall be effective as to the number of shares of a Series
of VRDP Shares specified therein as having been revoked less the number of
shares of such Series of VRDP Shares in respect of which the Remarketing Agent
has so notified the Tender and Paying Agent and the Liquidity Provider that it
has entered into an agreement of sale. Notwithstanding the foregoing, (x)
tendered shares of a Series of VRDP Shares, if any, that remain unsold and in
respect of which the Remarketing Agent has not entered into an agreement of
sale at or after the time of receipt by the Remarketing Agent of a Notice of
Revocation may, at the discretion of the Remarketing Agent, be allocated by the
Remarketing Agent to such Notice of Revocation and (y) tendered shares of a
Series of VRDP Shares, if any, that remain unsold on the related Purchase Date
shall be allocated by the Remarketing Agent to each Notice of Revocation
received in respect of shares of such Series of VRDP Shares tendered for
purchase on such Purchase Date and not already satisfied in the chronological
order in which each such Notice of Revocation was received by the Tender and
Paying Agent, and each such Notice of Revocation shall be effective only to the
extent of such allocation and availability of unsold shares of such Series of
VRDP Shares.
(g)
In connection with any Special Rate Period designated pursuant to
Section 4 of Part I of these Articles Supplementary, the Board of Directors,
without the vote or consent of any Holder of any shares of any Series of VRDP
Shares but with the prior written consent of the Liquidity Provider, in the
Notice of Special Rate Period relating to a Series of the VRDP Shares, as
delivered to the Remarketing Agent and the Liquidity Provider, may provide for
optional tender provisions relating solely to such Special Rate Period (“Special
Optional Tender Provisions”) whereby the minimum number of days’ notice required
for an Optional Tender may exceed seven (7) days as specified in the Special
Optional Tender Provisions for such Special Rate Period. The designation of
the Special Rate Period will be a Mandatory Tender Event in accordance with the
definition thereof.
(h)
The Corporation shall use its best efforts to engage at all times a
Remarketing Agent that is a nationally recognized securities dealer with
experience in remarketing variable-rate securities to use its best efforts to
find purchasers for all shares of a Series of VRDP Shares properly tendered
pursuant to a Tender.
2.
Remarketing Schedule.
(a)
In connection with any attempted Remarketing, all tendered shares of a
Series of VRDP Shares shall be remarketed at the Purchase Price of such
shares. The calculation of the Purchase Price of the shares of such Series of
VRDP Shares that are remarketed or purchased by the Liquidity Provider shall be
made by the Remarketing Agent in advance of such Remarketing or purchase and,
together with the details of the aggregate number and Purchase Price of
remarketed shares of such Series of VRDP Shares and the aggregate number and
Purchase Price of shares of such Series of VRDP Shares to be purchased by the
Liquidity Provider pursuant to the Purchase Obligation, shall be communicated
by the Remarketing Agent to the Corporation, the Liquidity Provider and the
Tender and Paying Agent by Electronic Means by 2:00 p.m., New York City time,
on the Business Day immediately preceding the Purchase Date, as described
below. The proceeds of any sale of any remarketed shares of a Series of VRDP
Shares by the Remarketing Agent relating to tendered shares of such Series of
VRDP Shares shall be used by the Tender and Paying Agent for the purchase of
the tendered shares of such Series of VRDP Shares at the Purchase Price, and
the terms of the sale will provide for the wire transfer of such Purchase Price
by the Remarketing Agent to be received by the Tender and Paying Agent no later
than 11:00 a.m., New York City time, on the related Purchase Date for payment
to the Agent Member of the Beneficial Owner, in the case of an Optional Tender,
or Holder, in the case of a Mandatory Tender, tendering shares of such Series
of VRDP Shares for sale through the Securities Depository in immediately
available funds
against delivery of the tendered
shares of such Series of VRDP Shares to the Tender and Paying Agent through the
Securities Depository, the delivery of such VRDP Shares to the Tender and
Paying Agent through the Securities Depository no later than 2:00 p.m., New
York City time, on the related Purchase Date and the re-delivery of such shares
of such Series of VRDP Shares by means of “FREE” delivery through the
Securities Depository to the Remarketing Agent for delivery to the purchaser’s
Agent Member through the Securities Depository by 3:00 p.m., New York City
time, on the related Purchase Date.
(b)
By 2:00 p.m., New York City time, on the Business Day immediately
preceding each Purchase Date, the Remarketing Agent shall deliver a notice, in
the form attached as Annex I to the Remarketing Agreement, to the Tender and
Paying Agent and the Liquidity Provider (and, at the direction of the
Corporation, concurrently therewith or as promptly as practicable thereafter,
to each Beneficial Owner or Holder tendering VRDP Shares that are the subject
of such notice) (a “Remarketing Notice”), by Electronic Means, that sets forth
the number of shares of the Series of VRDP Shares, if any, that it successfully
remarketed for purchase on such Purchase Date and the aggregate Purchase Price
of such sold shares of the Series of VRDP Shares and the number of shares of
such Series of VRDP Shares, if any, not successfully remarketed for purchase on
such Purchase Date and the aggregate Purchase Price of such unsold shares of
the Series of VRDP Shares to be paid by the Liquidity Provider. If the
Remarketing Notice states that the Remarketing Agent has not successfully
remarketed all of the shares of the Series of VRDP Shares to be purchased on
such Purchase Date, the Tender and Paying Agent shall promptly, and in any
event not later than 4:00 p.m., New York City time, on such Business Day,
deliver by Electronic Means to the Liquidity Provider (with a copy to the
Corporation) a Preliminary Notice of Purchase that, subject to delivery of the
Final Notice of Purchase on the Purchase Date described below, provides for the
purchase by the Liquidity Provider of the number of such shares of the Series
of VRDP Shares that the Remarketing Agent stated in the Remarketing Notice as
not having been successfully remarketed, including the aggregate Purchase Price
of such shares of the Series of VRDP Shares, as calculated by the Remarketing
Agent. If the Remarketing Notice states that the Remarketing Agent has not
successfully remarketed all of the shares of the Series of VRDP Shares to be
purchased on such Purchase Date (or if proceeds from a Remarketing for any
tendered shares of the Series of VRDP Shares have not been received for any
reason by the Tender and Paying Agent by 11:00 a.m., New York City time, on the
Purchase Date), the Tender and Paying Agent shall deliver by Electronic Means
to the Liquidity Provider (with a copy to the Corporation) by 12:00 noon, New
York City time, on such Purchase Date a Final Notice of Purchase that states
the number of shares of the Series of VRDP Shares required to be purchased by
the Liquidity Provider. For purposes of the Final Notice of Purchase, any
tendered shares of the Series of VRDP Shares for which proceeds from a
Remarketing have not been received for any reason by the Tender and Paying
Agent by 11:00 a.m., New York City time, on the Purchase Date (other than
shares of a Series of VRDP Shares owned by the Liquidity Provider and tendered
for Remarketing), shall be treated as not having been successfully remarketed
and shall be required to be purchased by the Liquidity Provider. Except for
manifest error, the payment obligation of the Liquidity Provider shall equal
the Purchase Price of the shares of the Series of VRDP Shares stated in the
Final Notice of Purchase delivered to the Liquidity Provider as being required
to be purchased by the Liquidity Provider.
(c)
The Liquidity Provider shall, no later than 2:00 p.m., New York City
time, on a Purchase Date for any shares of a Series of VRDP Shares, wire
transfer the aggregate Purchase Price of all shares of such Series of VRDP
Shares in respect of which Final Notices of Purchase have been delivered to it
for purchase of shares of such Series of VRDP Shares on such date, as follows:
(i) in the case of a Final Notice of Purchase delivered by the Tender and
Paying Agent, by wire transfer, in immediately available funds, to the account
of the Tender and Paying Agent specified by the Tender and Paying Agent in any
such Final Notice of Purchase; and (ii) in the event there is no Tender and
Paying Agent or for any reason the Tender and Paying Agent does not perform its
obligations under the VRDP Shares Purchase
Agreement
and the Liquidity Provider has received a Remarketing Notice that such shares
of such Series of VRDP Shares have not been the subject of an agreement of sale
in a Remarketing and has received written notice from the Corporation that
there is no Tender and Paying Agent or that the Tender and Paying Agent does
not intend to perform its obligations under the VRDP Shares Purchase Agreement,
in the case of a Final Notice of Purchase delivered by a Beneficial Owner or
its Agent Member, in the case of an Optional Tender, or by a Holder, in the
case of a Mandatory Tender, by payment against delivery of the shares of such
Series of VRDP Shares that are the subject of any such Final Notice of
Purchase, through means of the Securities Depository in the case of shares of
such Series of VRDP Shares in the form of global securities.
(d)
Upon receipt by the Tender and Paying Agent from the Beneficial Owner or
its Agent Member, in the case of an Optional Tender, or by the Holder, in the
case of a Mandatory Tender, of tendered shares of a Series of VRDP Shares and
the payment by the Tender and Paying Agent to such Beneficial Owner or its
Agent Member, or such Holder as the case may be, of the Purchase Price therefor
on the applicable Purchase Date, the Tender and Paying Agent shall deliver to
the Liquidity Provider, by means of “FREE” delivery through the system of the
Securities Depository, shares of such Series of VRDP Shares in satisfaction of
the Liquidity Provider’s Purchase Obligation on such Purchase Date. Any funds
paid by the Liquidity Provider and held in the account of the Tender and Paying
Agent for the payment of the Purchase Price shall be held in trust (i) in the
case of an Optional Tender, on the Purchase Date, for the benefit of the
tendering Beneficial Owners or their Agent Members until the shares of the
Series of VRDP Shares are delivered by the tendering Beneficial Owners or their
Agent Members and, after the Purchase Date, for the benefit of the Liquidity
Provider, for payment of the Purchase Price upon delivery of the shares of such
Series of VRDP Shares or, with respect to shares of such Series of VRDP Shares
that are not delivered, for return to the Liquidity Provider upon its request
and (ii) in the case of a Mandatory Tender, for the benefit of the tendering
Holders until delivery of the shares of such Series of VRDP Shares by the
tendering Holders against payment therefor. Any funds paid by the Remarketing
Agent and held in an account of the Tender and Paying Agent for the payment of
the Purchase Price in connection with a Remarketing shall be held in trust (i)
in the case of an Optional Tender, on the Purchase Date, for the benefit of the
tendering Beneficial Owners or their Agent Members until the shares of the
Series of VRDP Shares are delivered by the tendering Beneficial Owners or their
Agent Members and, after the Purchase Date, for the benefit of the Remarketing
Agent on account of purchasers purchasing in a Remarketing or for the
Remarketing Agent’s account to the extent it has advanced the Purchase Price of
any shares of such Series of VRDP Shares on behalf of one or more purchasers,
as applicable, for payment of the Purchase Price upon delivery of the shares of
such Series of VRDP Shares or, with respect to shares of such Series of VRDP
Shares that are not delivered, for return to the Remarketing Agent on account
of purchasers purchasing in a Remarketing or for the Remarketing Agent’s
account to the extent it has advanced the Purchase Price of any shares of such
Series of VRDP Shares on behalf of one or more purchasers, as applicable, upon
the Remarketing Agent’s request and (ii) in the case of a Mandatory Tender, for
the benefit of the tendering Holders until delivery of the shares of the Series
of VRDP Shares by the tendering Holders against payment therefor. Upon receipt
of the shares of a Series of VRDP Shares from the tendering Beneficial Owners
or their Agent Members, in the case of an Optional Tender, or from the
tendering Holders, in the case of a Mandatory Tender, by the Tender and Paying
Agent, the Tender and Paying Agent shall pay, subject to receipt of the
Purchase Price by the Tender and Paying Agent in the form of remarketing
proceeds from the Remarketing Agent, with respect to the shares of such Series
of VRDP Shares remarketed by the Remarketing Agent, or in the form of payment
pursuant to the VRDP Shares Purchase Agreement from the Liquidity Provider,
with respect to the shares of such Series of VRDP Shares subject to purchase
pursuant to the Purchase Obligation, the Purchase Price for shares of such
Series of VRDP Shares to such tendering Beneficial Owner, Agent Member or
Holder, as the case may be. In accordance with and subject to the foregoing,
the Tender and Paying Agent shall effect any such payment on the applicable
Purchase Date.
(e)
Except as otherwise expressly provided for herein, the purchase and
delivery of tendered shares of a Series of VRDP Shares in the form of global
securities and their Remarketing will be accomplished in accordance with the
applicable procedures of the Securities Depository.
(f)
In connection with the allocation of shares of a Series of VRDP Shares
tendered for Remarketing by the Liquidity Provider and any other Holder or
Beneficial Owner of shares of such Series of VRDP Shares in any Remarketing,
the Remarketing Agent shall allocate those shares of such Series of VRDP Shares
previously acquired by the Liquidity Provider pursuant to its Purchase
Obligation first to any purchasers in a Remarketing (such allocation coming
first from those shares of such Series of VRDP Shares acquired earliest by the
Liquidity Provider).
(g)
The Remarketing Agent and the Tender and Paying Agent each shall use
commercially reasonable efforts to meet the timing requirements set forth
above. Subject to the VRDP Shares Remarketing Agreement, the Remarketing Agent
may, in its sole discretion, modify the settlement procedures set forth above
with respect to any Remarketing upon ten (10) days’ prior written notice to the
Corporation, the Liquidity Provider and the Tender and Paying Agent, provided
any such modification does not adversely affect the Holders, the Beneficial
Owners, the Tender and Paying Agent, the Liquidity Provider or the
Corporation. The Remarketing Agent may sell shares of a Series of VRDP Shares
for its own account outside of a Remarketing at a price other than the Purchase
Price.
(h)
At any time that no Purchase Obligation is in effect (or with respect to
a Remarketing of shares of a Series of VRDP Shares held by the Liquidity
Provider as to which any theneffective Purchase Obligation by a successor
liquidity provider is inapplicable), any shares of a Series of VRDP Shares unsold
in a Remarketing will be returned to the relevant tendering Beneficial Owners
or their Agent Members, or the relevant tendering Holders, as the case may be,
by the Tender and Paying Agent. For purposes of the parenthetical in the
preceding sentence, the Purchase Obligation of a successor liquidity provider
shall be treated as inapplicable to shares of a Series of VRDP Shares held by
the Liquidity Provider unless and until either the Corporation or the Liquidity
Provider shall have given the Tender and Paying Agent written notice that such
Purchase Obligation is so applicable.
3.
Determination of Applicable Rate.
(a)
The Applicable Rate shall be determined by the Remarketing Agent on and
as of each Rate Determination Date as the lowest rate under then-existing market
conditions that in the Remarketing Agent’s sole judgment would result in the
shares of the Series of VRDP Shares on the first (1st) day of the Subsequent
Rate Period next succeeding the Rate Determination Date having a market value
equal to the Liquidation Preference thereof (plus accumulated but unpaid
dividends thereon, whether or not earned or declared). Such determination
shall be conclusive and binding upon the interested parties. The Applicable
Rate shall not be more than the Maximum Rate.
(b)
The Remarketing Agent shall establish the Applicable Rate by 5:00 p.m.,
New York City time, on each Rate Determination Date to the nearest
one-thousandth (0.001) of one percent per annum for the Subsequent Rate
Period. The Applicable Rate shall be in effect from and including the first
(1st) day following such Rate Determination Date to and including the following
Rate Determination Date. The Remarketing Agent shall make the Applicable Rate
available after 5:00 p.m., New York City time on the Rate Determination Date by
Electronic Means to the Corporation, the Tender and Paying Agent and the
Liquidity Provider and post the Applicable Rate on Bloomberg on such Rate
Determination Date.
(c)
In the event that the Remarketing Agent establishes the Maximum Rate as
the Applicable Rate for a Subsequent Rate Period, the Remarketing Agent shall
notify the Corporation and the Tender and Paying Agent of the Maximum Rate by
e-mail transmission or facsimile transmission after 5:00 P.M.,
New York City time, on each Rate Determination Date. The
Corporation will require in the Tender and Paying Agent Agreement that the
Tender and Paying Agent will notify the Liquidity Provider and the Holders of
VRDP Shares by first-class mail, postage prepaid (in the case of physical
shares), or by Electronic Means (in the case of VRDP Shares in the form of
global securities) that the Applicable Rate for the Subsequent Rate Period is
the Maximum Rate.
(d)
In the event the Remarketing Agent does not or is unable to determine
the Applicable Rate, or if there is no Remarketing Agent, the Applicable Rate
shall be the Maximum Rate.
(e)
In the event of a Failed Remarketing Condition, the Applicable Rate as
of the close of business on the day the Failed Remarketing Condition first
occurs will be adjusted to the Maximum Rate (with the Applicable Spread subject
to adjustment as set forth in the definition of Applicable Spread) and the
Maximum Rate will continue to be the Applicable Rate (i) until the first (1st)
day of the next succeeding Subsequent Rate Period after a Failed Remarketing
Condition no longer exists in the case of a Minimum Rate Period or a Special
Rate Period of twenty-eight (28) Rate Period Days or fewer, and (ii) until the
first (1st) day of the next succeeding Dividend Period after the Failed Remarketing
Condition no longer exists in the case of a Special Rate Period of greater than
twenty-eight (28) Rate Period Days.
4.
Failed Remarketing Condition. In the event of a Failed
Remarketing Condition, pursuant to the Tender and Paying Agent Agreement, the
Tender and Paying Agent shall promptly provide notice of a Failed Remarketing
Condition, but in any event within two (2) Business Days of receipt by the
Tender and Paying Agent of notice from the Corporation of the occurrence of
such Failed Remarketing Condition, by Electronic Means (or by first-class mail,
postage prepaid, in the case where VRDP Shares are in physical form outside the
book-entry system of the Securities Depository) to the Holders (with a copy to
the Corporation).
5.
Purchase of VRDP Shares by Remarketing Agent. The
Remarketing Agent in its sole discretion may purchase for its own account
shares of a Series of VRDP Shares in a Remarketing; however, the Remarketing
Agent shall not be obligated to purchase any shares of a Series of VRDP Shares that
would otherwise remain unsold in a Remarketing. None of the Corporation, the
Tender and Paying Agent or any Remarketing Agent shall be obligated in any case
to provide funds to make payment to a Beneficial Owner or its Agent Member or a
Holder upon such Beneficial Owner’s or Holder’s tender of its shares of a
Series of VRDP Shares in a Remarketing unless, in each case, such shares of
such Series of VRDP Shares were acquired for the account of the Corporation,
the Tender and Paying Agent or the Remarketing Agent, as applicable.
6.
Notification of Allocations. Whenever the Corporation
intends to include any net capital gains or ordinary income taxable for regular
federal income tax purposes in any dividend on shares of a Series of VRDP
Shares, the Corporation shall notify the Remarketing Agent and Tender and
Paying Agent of the amount to be so included (i) not later than fourteen (14)
calendar days preceding the first Rate Determination Date on which the
Applicable Rate for such dividend is to be established, and (ii) for any
successive Rate Determination Date on which the Applicable Rate for such
dividend is to be established, not later than the close of business on the
immediately preceding Rate Determination Date. Whenever such advance notice is
received from the Corporation, the Tender and Paying Agent will notify each
Holder and the Remarketing Agent will promptly notify each potential Beneficial
Owner or its Agent Member. With respect to a Rate Period for which such
advance notice was given and whose dividends are comprised partly of such
ordinary income or capital gains and partly of exempt interest income, the
different types of income will be paid in the same relative proportions for
each day during the Rate Period. The Corporation may also include such
ordinary income or capital gains in a dividend on shares of a Series of VRDP
Shares without giving advance notice thereof if it increases the dividends by
an additional amount calculated as if such income was a Taxable Allocation and
the additional amount was a
Gross-up Payment, provided
the Corporation will notify the Tender and Paying Agent of the additional
amounts to be included in such dividend at least five (5) Business Days prior
to the applicable Dividend Payment Date.
7.
Transfers.
(a)
Unless otherwise permitted by the Corporation, a Beneficial Owner or
Holder may sell, transfer or otherwise dispose of shares of a Series of VRDP
Shares only in whole shares and only pursuant to a Remarketing in accordance
with the Remarketing Procedures set forth in Part II of these Articles
Supplementary, provided, however, that (a) a sale, transfer or
other disposition of shares of a Series of VRDP Shares from a Beneficial Owner
who holds shares through an Agent Member to another Beneficial Owner who holds
shares through the same Agent Member shall be permitted, and (b) in the case of
all transfers other than pursuant to Remarketings, the Agent Member (or other
Person, if permitted by the Corporation) to whom such transfer is made shall
advise the Remarketing Agent. The Corporation has not registered the shares of
any Series of VRDP Shares under the Securities Act. Accordingly, the shares of
each Series of VRDP Shares are subject to restrictions on transferability and
resale and may only be purchased by and sold to “qualified institutional buyers”
(as defined in Rule 144A under the Securities Act or any successor provision)
in accordance with Rule 144A under the Securities Act or any successor
provision or any exemption from registration available and otherwise in accordance
with the legend set forth on the face of the share certificate for the share of
a Series of VRDP Shares.
(b)
The Investment Adviser, affiliated persons of the Investment Adviser (as
defined in Section 2(a)(3) of the 1940 Act) (other than the Corporation, in the
case of a purchase of shares of a Series of VRDP Shares which are to be
cancelled within ten (10) days of purchase by the Corporation), and Persons
over which the Investment Adviser, or affiliated persons of the Investment
Adviser (as defined in Section 2(a)(3) of the 1940 Act), exercise discretionary
investment or voting authority (other than the Corporation, in the case of a
purchase of shares of a Series of VRDP Shares which are to be cancelled within
ten (10) days of purchase by the Corporation), are not permitted to purchase
shares of a Series of VRDP Shares without the prior written consent of the
Liquidity Provider, and any such purchases shall be void ab initio; provided,
that without regard to the preceding requirements, purchases of shares of a
Series of VRDP Shares may be made by broker-dealers that are affiliated persons
of the Investment Adviser in riskless principal transactions with respect to
such purchases of shares of a Series of VRDP Shares.
(c)
If at any time the Corporation is not furnishing information to the SEC
pursuant to Section 13 or 15(d) of the Exchange Act, in order to preserve the
exemption for resales and transfers under Rule 144A, the Corporation shall
furnish, or cause to be furnished, to Holders of shares of a Series of VRDP
Shares and prospective purchasers of shares of a Series of VRDP Shares, upon
request, information with respect to the Corporation satisfying the
requirements of subsection (d)(4) of Rule 144A.
8.
Global Certificate.
Prior to the commencement of a Voting Period, (i) all of
the shares of a Series of VRDP Shares Outstanding from time to time shall be
represented by one or more global certificates registered in the name of the
Securities Depository or its nominee and countersigned by the Tender and Paying
Agent and (ii) no registration of transfer of shares of a Series of VRDP Shares
shall be made on the books of the Corporation to any Person other than the
Securities Depository or its nominee. The foregoing restriction on
registration of transfer shall be conspicuously noted on the face or back of
the certificates of VRDP Shares in such a manner as to comply with the
requirements of Section 2-211 of the Maryland General Corporation
Law and Section 8-204 of the Uniform Commercial Code as in effect in the State
of Maryland, or any successor provisions.
THIRD: The amendment to the charter of the Corporation as set
forth above in these Articles of Amendment has been duly advised by the Board
of Directors of the Corporation and approved by the stockholders of the
Corporation as and to the extent required by law and in accordance with the
charter of the Corporation.
FOURTH: The authorized stock of the Corporation has not been
increased by these Articles of Amendment.
FIFTH: These Articles of Amendment shall be effective as of June
19, 2019.
SIXTH: As amended hereby, the charter of the Corporation shall
remain in full force and effect.
SEVENTH: The undersigned acknowledges these Articles of Amendment
to be the act of the Corporation and, as to all matter or facts required to be
verified under oath, the undersigned acknowledges that to the best of his
knowledge, information and belief, these matters and facts are true in all
material respects and that this statement is made under the penalties of
perjury.
[Remainder
of the Page Intentionally Blank]
IN WITNESS WHEREOF, these Articles of Amendment are
hereby executed in the name of the Corporation on June 17, 2019.
ATTEST: BLACKROCK
MUNIYIELD CALIFORNIA FUND, INC.
By: /s/ Janey Ahn By:
/s/ Jonathan Diorio (SEAL)
Name: Janey Ahn Name:
Jonathan Diorio
Title: Secretary Title:
Vice President