September 4, 1997
VIA EDGAR
Securities and Exchange Commission
Division of Corporation Finance
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: Municipal Mortgage and Equity, L.L.C.
Registration Statement on Form S-3
Dear Sir or Madam:
On behalf of Municipal Mortgage and Equity, L.L.C. (the
"Company"), enclosed for filing electronically via EDGAR is the
Company's registration statement on Form S-3 (the "Registration
Statement") for 450,000 shares of limited liability company growth shares
to be issued under the Company's Dividend Reinvestment and Growth
Share Purchase Plan.
The Company hereby requests that the Registration Statement become
effective immediately upon filing, as provided by Rule 462(a) under the
Securities Act of 1933, as amended.
If you have any questions or comments concerning the enclosed filing,
please telephone me at (202) 973-0654.
Very truly yours,
R. Nicholas Singh
Enclosures
cc: Thomas R. Hobbs
Frank R. Goldstein
<PAGE>
As filed with the Securities and Exchange Commission on September 4, 1997
Registration No. 333-
- ------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
_______________
MUNICIPAL MORTGAGE AND EQUITY, L.L.C.
(Exact name of registrant as specified in its charter)
Delaware 52-1448733
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
218 North Charles Street
Suite 500
Baltimore, Maryland 21201
(410) 962-8044
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
_______________
Mark K. Joseph
Chief Executive Officer and Chief Financial Officer
Municipal Mortgage and Equity, L.L.C.
218 North Charles Street, Suite 500
Baltimore, Maryland 21201
(410) 962-8044
(Address, including zip code, and telephone number, including
area code, of agent for service)
_______________
Copies of communications to:
Frank R. Goldstein, Esq.
Brown & Wood LLP
815 Connecticut Avenue, N.W.
Washington, D.C. 20006
(202) 973-0600
_______________
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the
following box. X
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, please check the following box. __
_______________
CALCULATION OF REGISTRATION FEE
Title of Each Proposed Proposed
Class of Amount Maximum Maximum Amount of
Securities to be to Be Offering Aggregate Registration
Registered(1) Registered Price Per Unit Offering Price Fee
- ----------------- ---------- -------------- -------------- -----
Growth Shares of
limited liability 450,000
company interests, Growth
no par value. . . Shares $19.4375(2) $8,746,875(2) $2,650.57(3)
_____________________________________________________________________________
(1) This Registration Statement also relates to an indeterminable number of
Growth Shares that may be issued upon split of the Growth Shares, share
dividends on the Growth Shares or similar transactions in accordance
with Rule 416.
(2) Estimated in accordance with Rule 457(c) solely for the purpose of
calculating the registration fee and based on the average of the high
and low reported sale prices of the Growth Shares on the American Stock
Exchange on September 3, 1997.
(3) Pursuant to Rule 429, 450,000 Growth Shares and a filing fee of $2,650.57
are being carried forward from Registration Statement No. 333-20945 to
this Registration Statement.
<PAGE>
MUNICIPAL MORTGAGE AND EQUITY, L.L.C. PROSPECTUS
To Our Holders of Growth Shares:
Re: Prospectus for Dividend Reinvestment and Growth Share Purchase Plan
The Dividend Reinvestment and Growth Share Purchase Plan (the "Plan") of
Municipal Mortgage and Equity, L.L.C. (the "Company") provides you with a
convenient and simple method to purchase the Company's limited liability company
growth shares, without par value (the "Growth Shares"), without payment of any
brokerage commissions or service charges. This Plan gives you the opportunity
to increase your equity investment in the Company by using your cash
distributions from the Company reported annually to you on Form K-1
("dividends") to purchase Growth Shares ("Dividend Reinvestments"). All
purchases under the Plan are without payment of brokerage commissions or
service charges. The Plan provides for issuance of up to 450,000 Growth
Shares. Holders of the Company's Growth Shares are entitled to participate in
the Plan. The Plan is administered by Registrar and Transfer Company (the
"Agent"), who will purchase Growth Shares as agent for the accounts of
participants under the Plan from the Company or on the open market as described
herein.
The primary features of the Plan are as follows:
1. Reinvestment of Dividends. You may use all the dividends you are
entitled to receive on Growth Shares to purchase shares of Growth Shares.
See "Purpose of the Plan" and "Purchases and Price for Shares" below.
2. Price. The price paid for Growth Shares purchased for you will be 100%
of the average price of all Growth Shares purchased by the Agent, as agent
for the participants in the Plan, in the open market with respect to a
related dividend payment date. Alternatively, if the Agent purchases
Growth Shares directly from the Company, the price for Growth Shares
purchased for you will be deemed to be 100% of the closing price of
Growth Shares on the American Stock Exchange on the related dividend
payment date or, if Growth Shares are not traded on that date, on the
next trading day. See "Purchases and Price of Shares" below.
3. No Commissions or Other Expenses. You will pay no brokerage
commissions or other expenses when you purchase shares under the Plan.
The Company will pay all of these fees and expenses under the Plan. See
"Costs to Participants" below.
In the future, it is expected that the Plan will also allow you to make
optional cash investments ("Optional Cash Investment") ranging from $100 to
$5,000 each quarter to purchase additional Growth Shares. As with Dividend
Reinvestments, the Optional Cash Investment will allow you to purchase Growth
Shares at the price described above and without payment of brokerage
commissions or service charges. This Prospectus describes the Optional Cash
Investment feature of the Plan although shareholders can not make Optional
Cash Investments at this time. The Company will notify you when it will allow
shareholders to make Optional Cash Investments.
This Prospectus contains more detailed information about the Plan; we suggest
that you please read and review the entire Prospectus carefully before deciding
what to do.
THESE SECURITIES HAVE NOT BEEN APPROVED OR
DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
The date of this Prospectus is September 4, 1997
<PAGE>
AVAILABLE INFORMATION
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement (of which this Prospectus is a part) on
Form S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities
Act"). This Prospectus does not contain all the information set forth in the
Registration Statement, certain portions of which have been omitted as
permitted by the rules and regulations of the Commission. Statements
contained in this Prospectus as to the content of any contract or other
document are not necessarily complete, and in each instance reference is made
to the copy of such contract or other document filed as an exhibit to the
Registration Statement, each such statement being qualified in
all respects by such reference and the exhibits and schedules thereto. For
further information regarding the Company and the Growth Shares, reference is
hereby made to the Registration Statement and such exhibits and schedules,
which may be examined without charge at, or copies obtained upon payment of
prescribed fees from, the Commission and its regional offices listed below.
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements, and other information with the
Commission. The Registration Statement, as well as such reports, proxy
statements, and other information filed with the Commission, can be inspected
and copied at the public reference facilities maintained by the Commission at
Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549, and at the
Commission's Regional Offices at Citicorp Center, 500 West -Madison Street,
Suite 1400, Chicago, Illinois 60661, and Seven World Trade Center, 13th Floor,
New York, New York 10048. Copies of such material also can be obtained from
the Public Reference Section of the Commission, Washington, D.C. 20549 at
prescribed rates. The Company files its reports, proxy statements, and other
information with the Commission electronically. The Commission maintains a
Web site that contains reports, proxy and information statements, and other
information regarding registrants that file electronically with the
Commission at http://www.sec.gov. The Growth Shares are listed on the American
Stock Exchange, and reports, proxy statements and other information concerning
the Company can be inspected and copied at the offices of the American Stock
Exchange at 86 Trinity Place, New York, New York 10006.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed by the Company, under the Exchange
Act with the Commission and are incorporated by reference in this Prospectus:
1. The Company's Annual Report on Form 10-K for the year ended
December 31, 1996.
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1997.
3. The Company's Quarterly Report on Form 10-Q for the quarter ended June
30, 1997.
4. The Company's Current Report on Form 8-K dated January 2, 1997.
5. The Company's Prospectus/Consent Solicitation Statement included in its
Registration Statement on Form S-4 (File No. 33-99088), as declared
effective by the Commission on May 29, 1996, as it relates to the
description of the Company's Growth Shares contained under the caption
"Description of Shares" and incorporated by reference into Item I of Form
8-A filed with the Commission on July 25, 1996, pursuant to section 12(b)
of the Exchange Act, including all amendments and reports updating such
description.
All documents filed by the Company pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act after the date of this Prospectus and prior to the
termination of this offering shall be deemed to be incorporated by reference
in this Prospectus and to be a part hereof from the dates of filing of such
documents. Any statement contained in a document incorporated or deemed to
be incorporated by reference herein shall be deemed modified or superseded for
the purposes of this Prospectus to the extent that a statement contained
herein or in any other subsequently filed document that also is or is deemed
to be incorporated by reference herein modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as
so modified or superseded, to constitute a part of this Prospectus.
The Company will furnish without charge to each person, including any
beneficial owner, to whom this Prospectus is delivered, upon the written or oral
request of such person, a copy of any or all of the documents incorporated by
reference herein by reference, other than exhibits to such documents unless such
exhibits are specifically incorporated by reference into the Registration
Statement to which this Prospectus relates or into such other documents.
Requests for documents should be directed to Municipal Mortgage and Equity,
L.L.C., 218 North Charles Street, Suite 500, Baltimore, Maryland 21201,
Attention: Derek Cole, (410) 962-8044.
THE COMPANY
The Company is a Delaware limited liability company that originates, invests in
and services tax-exempt mortgage revenue bonds issued by state and local
government authorities to finance the construction of multifamily housing
developments and secured by nonrecourse first mortgage loans on the underlying
properties. The Company, organized in July 1996, is the successor to the
business of SCA Tax Exempt Fund Limited Partnership (the "Partnership"),
which was merged into the Company effective August 1, 1996. The Partnership,
organized in 1986, consummated public offerings of two series of Beneficial
Assignee Certificates representing the assignment of its limited partnership
interests, the $296,256,000 aggregate proceeds of which were used to acquire
23 mortgage revenue bonds. In a February 1995 financing transaction, the
Partnership received $56,831,000 in net proceeds available for further
investment from the sale of $67,700,000 principal amount of multifamily revenue
bond receipts secured by newly refunded bonds issued in exchange for 11 of the
Partnership's 23 bonds and the cash stream from one additional bond. At June
30, 1997, the Company owned a portfolio of 35 bonds, bond related investments
and other investments, of which 25 bonds enable the Company to participate
in the appreciation of the underlying multifamily housing apartments on a tax
exempt basis. The bonds and other bond related investments in the Company's
portfolio are backed primarily by suburban apartments.
The principal executive offices of the Company are located at 218 North
Charles Street, Suite 500, Baltimore, Maryland 21201, and its telephone
number at that location is (410) 962-8044.
DIVIDEND REINVESTMENT AND GROWTH SHARE PURCHASE PLAN
Terms and Conditions
The Dividend Reinvestment and Growth Share Purchase Plan (the "Plan")
consists of the following questions and answers. For additional information
concerning the Plan, you may telephone the Agent at the number shown under
Question 4 below.
Purpose of the Plan
1. What is the purpose of the plan?
The purpose of the Plan is to provide holders of the Company's Growth Shares
who elect to participate in the Plan ("Participants") with a simple and
convenient method of reinvesting their cash dividends in additional Growth
Shares of the Company.
Your participation in the Plan is subject to the terms and conditions as set
forth in this Prospectus. By enrolling in the Plan, you agree to abide by these
terms and conditions.
Advantages and Disadvantages
2. What are the advantages of the Plan?
The Plan offers Participants the following advantages:
(a) Dividends payable on all shares purchased and held under the Plan are
automatically reinvested in additional Growth Shares for the Participants.
(b) Periodic statements regarding purchase of shares and other activities
provide the Participants with simplified record-keeping.
(c) The Company pays all administrative costs associated with purchases
made under the Plan.
(d) Participants will avoid cumbersome safekeeping requirements through the
free custodial service of the Plan for shares purchased through the Plan.
3. What are the primary disadvantages of the Plan?
(a) The date by which decisions to reinvest dividends must be made for a
dividend payment date is seven business days prior to the record date, and
each record date will generally be 15 days prior to the applicable
dividend payment date. The date by which optional cash payments (when
permitted) must be made is five business days prior to the applicable
dividend payment date. During the periods between the date a participant
elects to have dividends reinvested or makes optional cash payments and
the date dividends are reinvested or optional cash payments are invested,
Participants' funds will be exposed to changes in market conditions.
(b) Participants will not have the authority to direct the time or the
price at which Growth Shares under the Plan may be purchased, nor will
Participants have any control over whether such Growth Shares are
purchased as original issue shares from the Company or shares purchased
in the open market.
(c) Participants will not be able to determine the actual number of Growth
Shares purchased on their behalf until after the applicable dividend
payment date.
(d) No interest will be paid on uninvested optional cash payments held by
the Agent. Therefore, when the Optional Cash Investment feature is
effective, Participants may want to submit optional cash payments as close
as possible to the fifth business day prior to the applicable dividend
payment date.
Administration
4. Who administers the Plan for Participants?
The Company's share transfer agent, Registrar and Transfer Company (the
"Agent"), a corporation independent of, and not affiliated with, the Company,
administers the Plan for the Participants, keeps records, sends statements of
account to Participants, and performs other duties related to the Plan. Shares
purchased through the Plan will be registered in the name of the Agent or its
nominee as agent for Participants in the Plan.
All inquiries and communications regarding the Plan should include your
account number and should be directed to the Agent at:
Registrar and Transfer Company
Dividend Reinvestment Plans
10 Commerce Drive
Cranford, New Jersey 07016
(800) 368-5948
The Agent or the Company may terminate or suspend the Plan at any time by
written notice to Participants. The terms and conditions of the Plan may be
amended by the Company or the Agent (with the concurrence of the Company) at
any time by mailing an appropriate notice to Participants at least 30 days
prior to the effective date of the amendment (see Question 27). See Question
28 for additional information regarding the responsibilities of the Agent.
Participation
5. Who is eligible to participate?
Any shareholder whose Company's Growth Shares are registered in his or her
name on the records of the Agent may enroll in the Plan.
If a shareholder has Growth Shares registered in the name of someone else (for
example, with a bank, broker or trustee), the shareholder (the "Beneficial
Owner") may be able to arrange for their bank, broker or trustee to participate
in the Plan. Beneficial Owners should consult directly with the bank, broker
or trustee holding their Growth Shares to determine if they can enroll in the
Plan on behalf of the Beneficial Owner. If such entity will not enroll in the
Plan on behalf of the Beneficial Owner, the Beneficial Owner should request the
bank, broker or trustee to have some or all of the Growth Shares registered in
the Beneficial Owner's own name in order to participate directly. If a
Beneficial Owner transfers some of the Growth Shares in his or her name and
participates in the Plan, only the shares so transferred will be enrolled in
the Plan.
6. How can persons whose shares are registered in the names of others
participate in the Plan?
A Beneficial Owner may participate in the Plan either:
* by having the Growth Shares registered directly in the name of the
Beneficial Owner and signing and returning an Authorization Form to the
Agent or
* by making appropriate arrangements for the Beneficial Owner's bank,
broker or trustee to participate in the Plan on behalf of the Beneficial
Owner.
Purchase of Growth Shares
7. May Participants purchase Preferred Shares or Preferred CD Shares under
the Plan?
No, under the Plan, Participants may only purchase Growth Shares.
Enrollment
8. How does an eligible shareholder participate in the Plan?
An eligible shareholder whose Growth Shares are registered in his or her name
may enroll in the Plan by signing an Authorization Form and returning it to the
Agent in the enclosed envelope. Such eligible shareholder also may enroll by
providing written instructions in a letter signed and dated by the registered
holder(s) stating that he or she wishes to enroll in the Plan. Authorization
Forms may be obtained at any time from the Agent at the address specified in
Question 4 or the Company at the following address and telephone number:
Municipal Mortgage and Equity, L.L.C
218 North Charles Street, Suite 500
Baltimore, Maryland 21201
410-962-8044
Attention: Investor Relations
A Beneficial Owner will need to request the Beneficial Owner's bank, broker or
trustee to participate in the Plan on their behalf. Alternatively, a
Beneficial Owner can have his or her Growth Shares registered in the name of
the Beneficial Owner and participate in the Plan in the same way that any
registered owner can participate in the Plan. See Questions 5 and 6.
9. When may an eligible shareholder join the Plan?
An eligible shareholder whose Growth Shares are registered in his or her name
may enroll in the Plan at any time. Such shareholder's participation in the
Plan will begin as described in Question 11. An Authorization Form will be
automatically sent to all new registered holders of Growth Shares. (See
Questions 5 and 8.)
A Beneficial Owner will have to request his or her bank, broker or trustee to
participate in the Plan on his or her behalf, and the holder of a Beneficial
Owner's Growth Shares can participate on behalf of the Beneficial Owner by
contacting the Agent. Alternatively, a Beneficial Owner can have his or her
Growth Shares registered in his or her name and participate by completing an
Authorization Form.
10. What does the Authorization Form provide?
Except with respect to dividends on Growth Shares in a Participant's Plan
account, which are automatically reinvested, the Authorization Form provides for
the purchase of Growth Shares with the cash dividends on all of the shares
registered in the name shown on the Authorization Form.
11. When must the written authorization be received by the Agent to begin
reinvesting dividends?
To begin participation in the Plan for reinvestment of a particular cash
dividend, the Agent must receive a shareholder's Authorization Form or written
enrollment authorization at least seven business days before the record date
for that dividend, which is typically approximately 15 days before that
dividend payment date. If the written authorization is received after the
record date for a particular dividend, that dividend will be paid in cash and
the shareholder's participation in the Plan will begin with the dividend, as
declared, for the following quarter.
The holder of a Beneficial Owner's Growth Shares must also contact the Agent
in the time period described above.
12. How may a Participant change enrollment options under the Plan?
A Participant may change enrollment options at any time by completing a new
Authorization Form and returning it to the Agent. All Authorization Forms
indicating a change of options must be received by the Agent seven business days
prior to a particular cash dividend record date in order to take effect with
respect to the following dividend payment date.
A Beneficial Owner who is participating in the Plan through his bank, broker or
trustee must contact such bank, broker or trustee and request that it change the
Beneficial Owner's enrollment options. The Agent must receive notice of the
change of options by the time period described above.
Date of Purchase
13. When will purchases of Growth Shares under the Plan be made?
The Company anticipates making dividend payments within 60 days of each
calendar quarter, and purchases will be made on or immediately after the
dividend payment date. Therefore, cash dividends on shares for which dividend
reinvestment is authorized, and on Growth Shares previously credited to
Participants' accounts under the Plan, will be automatically reinvested on or
immediately after the dividend payment date to purchase Growth Shares. When the
Optional Cash Investment feature is effective, optional cash payments will be
invested on or immediately after the dividend payment date.
Purchases and Price of Shares
14. What will be the price of the Growth Shares purchased under the Plan?
Growth Shares purchased for Participants will, at the Company's election, come
from the Company's Growth Shares reserved for issuance under the Plan or will be
purchased in the open market, or a combination of the foregoing. The price paid
for Growth Shares purchased from the Company will be 100% of the closing price
of the Growth Shares on the related dividend payment date or, if the Growth
Shares are not traded on such date, on the next trading day. If the shares
are purchased in the open market, they will be deemed to have been acquired
at the average price of all shares purchased by the Agent relating to a
particular dividend payment date.
Dividend payments and optional cash payments (when permitted) may be
combined for the purchase of Growth Shares relating to a particular dividend
payment date.
15. How many Growth Shares will be purchased for Participants?
Each Participant's account will be credited with that number of Growth Shares,
including fractions computed to four decimal places, equal to the dollar
amounts to be invested divided by the applicable purchase price. (See
Question 14.) The number of shares to be purchased with dividends or
optional cash payments (when permitted) cannot be determined until after
their purchase. A Participant's account will be credited with dividends on
fractional shares. Cash dividends on all shares credited to a Participant's
account under the Plan will be automatically reinvested to purchase additional
Growth Shares.
Cash Investment Option
16. How are optional payments made?
The Optional Cash Investment feature is not yet effective, and the
Company will notify Participants when it will become effective.
When the Company determines to make the Optional Cash Investment feature
effective, a Participant may elect to make optional cash contributions. In
general, under this feature, a Participant will have the option to invest a
minimum of $100 and a maximum of $5,000 cash per calendar quarter in
additional Growth Shares.
A Beneficial Owner who is participating in the Plan through a bank, broker or
trustee will also be able to make optional cash contributions as described
above. Such a Beneficial Owner will be able to request his or her bank,
broker or trustee to make the optional cash contributions on his or her behalf.
Optional cash payments will have to be received from a Participant acting on
his or her own behalf or on behalf of a Beneficial Owner not earlier than 30
days prior to a dividend payment date and at least five business days prior
to that dividend payment date. Payments received within such time will be
held by the Agent until combined with funds from that dividend for purchase
of Growth
Shares.
The price which will be paid for Growth Shares purchased under the Optional
Cash Investment feature is described in Question 14.
No interest will be paid on optional cash payments pending investment.
Optional cash payments which are received later than five business days prior to
the regular quarterly dividend payment date will be returned. To avoid
unnecessary accumulations, the Company recommends that optional cash payments
be sent so they are received by the Agent shortly before the fifth business
day prior to the applicable dividend payment date. Participants may obtain
the return of any optional cash payment by written request received by the
Agent not less than two business days before it is to be invested.
Optional cash investments will be able to be made by personal check, official
bank check, or money order and will need to be made payable to Registrar and
Transfer Company and returned along with the Authorization Form. Thereafter,
optional cash payments will be able to be made through the use of cash payment
forms sent to you as part of your account statement.
Investment Information Furnished to Participants
17. What investment information will be sent to Participants in the Plan?
Within 15 days after each dividend payment date, the Agent will mail to each
Participant for whom cash dividends were reinvested a statement showing any cash
dividends received and reinvested, the number of Growth Shares purchased, the
price paid per share, and a history of the transactions for the current
calendar year. The statement will also show the number of Growth Shares held
of record by the Participant and enrolled in the Plan on the dividend record
date.
When the Optional Cash Investment feature is effective, the Company will
provide similar information with respect to any optional cash investments used
to purchase Growth Shares under the Plan.
Custody of Shares
18. Will certificates be issued for Growth Shares purchased under the Plan?
Certificates for Growth Shares purchased under the Plan will not be issued to
Participants unless requested. This process protects against loss, theft, or
destruction of share certificates. Participants may request that certificates
be issued and delivered to them, however, for all of their full Plan shares
(and cash payments with respect to any fractional shares at the price
described in Question 20). Requests for issuance of certificates, which will
be issued only once each calendar year, may be made annually by December 1
for issuance by December 31 of that year. Such requests must be made by
writing to the Agent at the address specified in Question 4.
19. In whose name will the Growth Shares purchased under the Plan be
registered?
Unless and until certificates are issued to Participants, Growth Shares
purchased under the Plan will be registered in the name of the Agent, as
agent for Participants in the Plan. Plan accounts are maintained in the names
in which the Participants' Growth Shares were registered at the time such
shares were enrolled in the Plan. Certificates for full Plan Growth Shares
will be registered in the same manner when they are issued. Participants may
transfer their full Plan Growth Shares, however, when issued, into names other
than their own by submitting to the Agent a stock power or assignment form
signed by all registered holders, with all signatures guaranteed by a bank,
securities dealer, or other eligible financial institution with membership in
an approved signature guarantee Medallion Program. These forms may be
obtained from the Agent at the address specified under Question 4 or by
telephoning the number specified under Question 4.
Shares credited to a Participant's Plan account may not be pledged as
collateral or sold unless the shares are first withdrawn from the Plan.
Dividends from one shareholder's account cannot be credited to the Plan
account of another shareholder.
Termination of Plan Participation
20. How is participation in the Plan terminated?
In order to terminate participation in the Plan, a Participant acting on his
or her own behalf must send a written request to the Agent at the address
specified under Question 4. A Beneficial Owner who is participating in the
Plan through their bank, broker or trustee should contact that entity to
advise it that he or she no longer wants to participate in the Plan.
When participation in the Plan is terminated, a certificate for the number of
whole Growth Shares credited to the Participant's account under the Plan will be
issued and a cash payment will be made for the value of any fraction of a
share. Cash payment for fractional shares will be made on the basis of the
closing price for the Growth Shares on the American Stock Exchange on the day
preceding the Agent's receipt of the Participant's termination request. If
the American Stock Exchange is closed on the day preceding receipt of the
notice, then the closing price for the next preceding trading day will be
used for determining the amount of any such cash payment.
The Company may, at its own discretion, terminate a Participant's Plan account
if the account contains less than one full share for more than six months and
the Participant is not reinvesting the dividends on any shares registered in the
Participant's name. Participation in the Plan also may be terminated when the
Agent is notified of the death of a Participant.
21. When may participation in the Plan be terminated?
Participation in the Plan may be terminated at any time. A written request for
termination must be received by the Agent on or before the record date for a
particular dividend in order to be effective for that dividend.
Rejoining the Plan
22. May a shareholder rejoin the Plan?
Generally, an eligible shareholder may again become a Participant at any time.
The Company reserves the right, however, to reject any enrollment authorization
from a previous Participant on the grounds of excessive joining and
terminating. This restriction is intended to minimize unnecessary
administrative expense and to encourage use of the Plan as a long-term
shareholder investment service. Eligible shareholders may re-enroll in the
Plan in the manner described in Question 8. To resume participation in the
Plan for reinvestment of a particular cash dividend, the
Agent must receive a shareholder's Authorization Form or written enrollment
authorization at least seven business days before the record date for that
dividend. See Question 11. Beneficial Owners should contact the entity
holding their Growth Shares and request that it resume participation in the
Plan on their behalf. See Questions 6 and 11.
Costs to Participants
23. Are there any expenses to Participants in connection with the Plan?
No, Participants are able to acquire additional Growth Shares under the Plan
without paying brokerage commissions or the administrative costs of the Plan.
Federal Income Tax Consequences
24. What are the federal income tax consequences of participation in the Plan?
The Company is classified as a partnership for federal tax purposes in which
each shareholder is treated as a partner. Although numerous precedents exist
concerning the tax treatment of dividend reinvestment plans maintained by
corporations, there are no statutes, regulations, administrative rulings, or
judicial decisions addressing the tax treatment of a reinvestment plan
maintained by a partnership. The following discussion is based on rules that
generally apply to distributions from partnerships and reflects the manner in
which the Company will report transactions under the Plan to shareholders and
to the Internal Revenue Service. Shareholders are urged to consult their own
tax advisors concerning the tax treatment of their participation in the Plan.
Generally, the distribution of cash by a partnership to a partner reduces the
partner's tax basis in his or her interest in the partnership and will result
in gain recognition to a partner only to the extent the distribution exceeds
the partner's tax basis. A contribution of cash by a partner to a partnership
increases that partner's tax basis in his or her interest in the partnership.
A partner has a single tax basis for his or her interest in a partnership,
even if different units of interest in the partnership were acquired at
different times and at different prices.
If the Agent receives a cash distribution from the Company on behalf of a
Participant and uses that distribution to purchase shares on the open market,
the Participant would be treated as though he or she actually received the cash
distribution and used that distribution to purchase shares. If the Agent
receives a cash distribution from the Company on behalf of a Participant and
uses that distribution to purchase shares directly from the Company, the
Participant would likely be viewed as having actually received a distribution
from the Company and as having immediately contributed an equal amount to the
Company for an increased interest in the capital and profits of the Company.
In either situation, no gain or loss would be recognized to a Participant, and
there would be no net change in the Participant's basis in its interest in the
Company. Moreover, in either situation, the shares acquired pursuant to the
Plan would be identical in all respects to existing Growth Shares and, as such,
would entitle the holder thereof to a share of all items of income, including
tax exempt income, and expense of the Company.
Participants will not realize any taxable income as a result of their receipt
of certificates for whole shares credited to their account under the Plan,
either upon their request for certificates for some of those shares or upon
termination of their Plan participation. However, Participants who receive,
upon termination of their Plan participation, a cash payment for a fractional
share credited to their account or for shares repurchased by the Company will
realize a taxable gain or loss. Gain or loss will also be realized by
Participants when whole shares are sold after withdrawal from the Plan.
Other Information
25. What happens if the Company issues a share dividend or declares a share
split?
Any Growth Shares distributed as a result of a share dividend or share split by
the Company on shares credited to the account of a Participant under the Plan
will be added to the Participant's account. Share dividends or split shares
distributed on shares registered in the name of the Participant will be mailed
directly to the Participant in the same manner as to shareholders who are not
participating in the Plan.
26. How will a Participant's shares be voted at meetings of shareholders?
Plan shares will be voted by the Agent as the shareholder directs.
Participants will receive one proxy covering both their Plan shares and any
shares registered in their own name, which will be voted in accordance with
their proper instructions. If a properly signed proxy is returned without
specific voting instructions, all of the Participant's Plan shares and any
shares registered in the Participant's name will be
voted in accordance with the recommendations of the Company's management. If
the proxy is not returned, the Participant's Plan shares and any shares
registered in the Participant's name will not be voted by the Agent.
27. May the Plan be changed or discontinued?
While the Company hopes to continue a dividend reinvestment and stock
purchase plan indefinitely, the Company and the Agent reserve the right to
terminate or suspend the Plan at any time by written notice to the
Participants. The terms and conditions of the Plan may also be amended by
the Company or by the Agent (with the concurrence of the Company) at any
time by mailing an appropriate notice to Participants at least 30 days prior
to the effective date of such amendment. Notwithstanding the foregoing, such
amendments to the Plan as may be required from time to time due to changes in
or new rules and regulations under the federal or state securities laws may be
made prior to notice to each Participant.
28. What is the responsibility of the Company and the Agent for the Plan?
The Agent has no responsibility with respect to the preparation and the
contents of this Prospectus. Neither the Company nor the Agent or its
nominee(s), in administering the Plan, will be liable for any act done in
good faith, or for any good faith omission to act, including, without
limitation, any claims of liability arising out of (i) failure to terminate a
Participant's account upon the Participant's death prior to the receipt of
notice in writing of the death, (ii) the prices and times
at which Growth Shares are purchased or sold for the Participant's account or
the terms on which such purchases or sales are made, or (iii) fluctuations in
the market value of the Growth Shares.
Neither the Company nor the Agent can assure any Participant of a profit
or protect any Participant against a loss from the shares purchased or sold
through the Plan. An investment in Growth Shares is, as are all equity
investments, subject to significant market fluctuations. The Company can
neither control purchases by the Agent under the Plan nor guarantee that
dividends on the shares will not be reduced or eliminated.
The Plan is not subject to the provisions of the employee Retirement Income
Security Act of 1974, as amended, and is not qualified under Section 401(a)
of the Internal Revenue Code of 1986, as amended.
USE OF PROCEEDS
The Company intends to use the proceeds from the Plan's purchase of Growth
Shares from the Company for general business purposes, including new
investments. Pending such uses, the Company may invest such net proceeds in
short term liquid investments. Any specific allocation of the net proceeds
of an offering of the Growth Shares to a specific purpose will be determined
at the time of such offering and will be described in the related Prospectus
Supplement.
PLAN OF DISTRIBUTION
The Growth Shares sold under the Plan will be purchased by the Agent directly
from the Company or in the open market through broker-dealers unaffiliated with
the Agent. There will be no brokerage commissions or other fees charged to
Participants in connection with the purchase of Growth Shares under the Plan.
Broker-dealers and other financial intermediaries may engage in positioning
and other transactions that will allow them to acquire Growth Shares prior to
the record date for dividends. The Company does not expect that financial
intermediaries will engage in such transactions to any significant extent, if
at all. The Company has not entered into any formal or informal arrangement
with any financial intermediary to engage in such transactions and does not
intend to do so.
DESCRIPTION OF GROWTH SHARES
The following brief description of the Growth Shares does not purport to be
complete and is subject in all respects to applicable Delaware law and to the
provisions of the Company's Amended and Restated Certificate of Formation and
Operating Agreement, as amended (the "Operating Agreement") and By-laws,
copies of which are exhibits to the Registration Statement of which this
Prospectus is a part.
The Operating Agreement does not limit the number of Growth Shares which
the Company's Board of Directors may cause the Company to issue. The Company
had 11,092,889 Growth Shares outstanding at August 26, 1997. The Company
will pay distributions to holders of the Growth Shares on a pro rata basis when
declared by its Board of Directors out of funds legally available therefor.
Distributions to the holders of Growth Shares are subject to preferences on
distributions on the Company's then outstanding Series I Preferred Shares,
Series II Preferred Shares, Series I Preferred Capital Distribution Shares,
Series II Preferred Capital Distribution Shares, Term Growth Shares, and any
other preferred securities which may be issued by the Company in the future.
At August 26, 1997, the Company had outstanding 16,329 Series I Preferred
Shares, 7,637 Series II Preferred Shares, 8,909 Series I Preferred Capital
Distribution Shares, 3,809 Series II Preferred Capital Distribution Shares
and 2,000 Term Growth Shares.
Holders of Growth Shares have no preemptive, conversion, sinking fund or
cumulative voting rights. The Growth Shares are not redeemable, except pursuant
to certain anti-takeover provisions adopted by the Company.
The Operating Agreement and By-laws of the Company set forth the
relationship of the shareholders to the Company and to one another and the
manner in which the Company will conduct its operations, much like the
articles and bylaws of a Delaware corporation or the partnership agreement of
a Delaware general or limited partnership. While as a limited liability
company the Company is not subject to the Delaware General Corporation Law
(the "DGCL"), the Delaware Act permits a limited liability company agreement
to provide, and the Operating Agreement and By-laws of the Company do provide,
that the management of a limited liability company shall be conducted by a
board of directors and officers designated by such board and that the holders
of shares in such limited liability company (as is the case with the holders
of the Growth Shares) be afforded substantially all of the rights that are
afforded holders of the common stock issued by a corporation organized under
the DGCL. In all material respects, the fiduciary duties of the directors and
officers of the Company and any duties of shareholders of the Company and
their affiliates are the same as those applicable under the DGCL.
EXPERTS
The financial statements incorporated in this Prospectus by reference to the
Annual Report on Form 10-K for the year ended December 31, 1996, have been so
incorporated in reliance on the report of Price Waterhouse LLP, independent
accountants, given on the authority of said firm as experts in auditing and
accounting.
LEGAL MATTERS
Certain legal matters will be passed upon for the Company by Brown & Wood
LLP, Washington, D.C.
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution
The following table is an itemized listing of expenses to be incurred by the
Company in connection with the issuance and distribution of the Growth Shares
being registered hereby. All amounts are estimates, except for the SEC
Registration fee:
To Be Paid By
Registrant
SEC Registration Fee . . . . . . . . . . . . . . . $ 2,651
AMEX Listing Fee . . . . . . . . . . . . . . . . . $ -
Printing and Engraving Expenses. . . . . . . . . . $30,000
Accounting Fees and Expenses . . . . . . . . . . $10,000
Legal Fees and Expenses (other than Blue Sky). . . $20,000
Transfer Agent and Registrar Fees. . . . . . . . . $ 500
Blue Sky Fees and Expenses . . . . . . . . . . . . $ 2,000
Miscellaneous. . . . . . . . . . . . . . . . . . . $ 849
Total. . . . . . . . . . . . . . . . . . . . . . . $66,000
Item 15. Indemnification of Officers and Directors
The Company's Amended and Restated Certificate of Formation and Operating
Agreement, as amended (the "Operating Agreement"), contains the following
provisions relating to indemnification of directors and officers. All terms
capitalized below and not otherwise defined shall have the meanings set forth
in the Operating Agreement.
8.1. Limitations on Liability, and Indemnification Of, Directors and Officers.
(a) No directors or officers of the Company shall be liable, responsible or
accountable in damages or otherwise to the Company or any of the Shareholders
for any act or omission performed or omitted by him or her, or for any decision,
except in the case of fraudulent or illegal conduct of such person. For
purposes of this Section 8.1, the fact that an action, omission to act or
decision is taken on the advice of counsel for the Company shall be evidence
of good faith and lack of fraudulent conduct.
(b) All directors and officers of the Company shall be entitled to
indemnification from the Company for any loss, damage or claim (including any
reasonable attorney's fees incurred by such person in connection therewith)
due to any act or omission made by him or her, except in the case of
fraudulent or illegal conduct of such person; provided, that any indemnity
shall be paid out of, and to the extent of, the assets of the Company only
(or any insurance proceeds available therefor), and no Shareholder shall have
any personal liability on account thereof.
(c) The termination of any action, suit or proceeding by judgment, order,
settlement or conviction, or upon a plea of nolo contendere or its equivalent,
shall not, of itself, create a presumption that the Person acted fraudulently
or illegally.
(d) The indemnification provided by this Section 8.1 shall not be deemed
exclusive of any other rights to which those indemnified may be entitled
under any agreement, vote of shareholders or directors, or otherwise, and
shall inure to the benefit of the heirs, executors and administrators of such
a person.
(e) Any repeal or modification of this Section 8.1 shall not adversely affect
any right or protection of a director or officer of the Company existing at
the time of such repeal or modification.
(f) The Company may, if the Board of Directors of the Company deems it
appropriate in its sole discretion, obtain insurance for the benefit of the
Company's directors and officers, relating to the liability of such persons.
The Company has purchased insurance for the benefit of the directors and
officers of the Company, relating to the liability of such persons. The
directors and officers liability insurance insures (i) the officers and
directors of the Company from any claim arising out of an alleged wrongful
act by such persons while acting as directors and officers of the Company and
(ii) the Company to the extent that it has indemnified the directors and
officers for such loss.
Item 16. Exhibits
Exhibit
Number Description of Exhibit
4.1 Form of Amended and Restated Certificate of Formation and Operating
Agreement of the Company (filed as Exhibit 3.4 to the Company's
Registration Statement on Form S-4 (File No. 33-99088), filed
November 7, 1995, and incorporated by reference herein)
4.2 By-laws of the Company (filed as Exhibit 3.5 to the Company's
Registration Statement Form S-4 (File No. 33-99088), filed
November 7, 1995, and incorporated by reference herein)
4.3 Specimen Copy of Growth Share (filed as Exhibit 4.1 to the Company's
Registration Statement on Form S-4 (File No. 33-99088) filed November
7, 1995 and incorporated by reference herein)
5.1 Opinion of Brown & Wood LLP as to legality of securities being
registered
8.1 Opinion of Brown & Wood LLP as to certain tax matters (included in
Exhibit 5.1)
23.1 Consent of Price Waterhouse LLP
23.2 Consent of Brown & Wood LLP (included in Exhibit 5.1)
24.1 Powers of Attorney (included on the original signature page of this
Registration Statement)
99.1 Specimen Authorization Card
Item 17. Undertakings
The undersigned Registrant hereby undertakes:
(1) to file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement:
(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933 (the "Securities Act");
(ii) to reflect in the prospectus any facts or events arising after the
effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in the registration statement. Notwithstanding the foregoing,
any increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that which
was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Securities and Exchange Commission
(the "Commission") pursuant to Rule 424(b) if, in the aggregate,
the changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement; and
(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
PROVIDED, HOWEVER, that paragraphs (1)(i) and (1)(ii) of this section do not
apply if the registration statement is on Form S-3, Form S-8 or Form F-3, and
the information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with or furnished to the
Commission by the registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 (the "Exchange Act") that are incorporated by
reference in the registration statement; (2) that, for the purpose of
determining any liability under the Securities Act, each such post-effective
amendment shall be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof; and (3) to
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of determining
any liability under the Securities Act, each filing of the registrant's
annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act
(and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the registration statement shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at the time shall be deemed to be the initial
bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act of
1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by the registrant of expenses incurred or
paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities
being registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.
The undersigned Registrant hereby further undertakes that:
(1) for purposes of determining any liability under the Securities Act, the
information omitted from the form of prospectus filed as part of this
registration statement in reliance upon Rule 430A and contained in a form of
prospectus filed by the registrant pursuant to Rule 424(b)(1) or (4) or 497(h)
under the Securities Act shall be deemed to be part of this registration
statement as of the time it was declared effective; and
(2) for the purpose of determining any liability under the Securities Act,
each post-effective amendment that contains a form of prospectus shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Baltimore, State of Maryland, on the 4 day of
September, 1997.
Municipal Mortgage and Equity, L.L.C.
By: /s/ Mark K. Joseph
Name: Mark K. Joseph
Title: Chief Executive Officer and
Chief Financial Officer
The registrant and each person whose signature appears below hereby
constitutes and appoints Mark K. Joseph as attorney-in-fact with full power of
substitution, to execute in the name and on behalf of the registrant, and each
person, individually, and in each capacity stated below, any and all amendments
(including pre-effective and post-effective amendments) to the Registration
Statement; and to file the same with all exhibits thereto, and other documents
in connection therewith, with the Securities and Exchange Commission,
granting unto said attorney-in-fact full power and authority to do and
perform each and every act and thing requisite and necessary to be done in
connection therewith, as fully to all intents and purposes as he might or
could do in person, hereby ratifying and confirming all that said attorney-in
- -fact or his substitute or substitutes may lawfully do or cause to be done by
virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons, in the capacities and on the
dates indicated.
SIGNATURE TITLE DATE
/s/ Mark K. Joseph Chairman of the Board, September 4, 1997
- ------------------- Chief Executive
Mark K. Joseph Officer (Principal Executive
Officer), Chief Financial Officer
(Principal Financial Officer and
Principal Accounting Officer),
and Director
/s/ Charles C. Baum Director September 4, 1997
- -------------------
Charles C. Baum
/s/ Richard O. Berndt Director September 4, 1997
- ---------------------
Richard 0. Berndt
/s/ Robert S. Hillman Director September 4, 1997
- ---------------------
Robert S. Hillman
/s/ William L. Jews Director September 4, 1997
- ---------------------
William L. Jews
/c/ Carl W. Stearn Director September 4, 1997
- --------------------
Carl W. Stearn
Exhibit 5.1
September 4, 1997
Municipal Mortgage and Equity, L.L.C.
218 North Charles Street
Suite 500
Baltimore, MD 21201
RE: Municipal Mortgage and Equity, L.L.C.
Registration Statement on Form S-3 for 450,000 shares of
Growth Shares to be issued under the Dividend
Reinvestment and Growth Share Purchase Plan
Ladies and Gentlemen:
We have acted as counsel to Municipal Mortgage and Equity, L.L.C.,
a Delaware limited liability company (the "Company"), in connection with
the preparation of a registration statement on Form S-3 (the "Registration
Statement") filed with the Securities and Exchange Commission under the
Securities Act of 1933, as amended (the "Act"), relating to the registration
of 450,000 growth shares of limited liability company interests, without
par value (the "Growth Shares"), of the Company pursuant to the
Municipal Mortgage and Equity, L.L.C. Dividend Reinvestment and
Growth Share Purchase Plan (the "Plan"). We have participated in the
preparation of the Registration Statement and we have examined such
documents, records, statutes and decisions as we have deemed relevant.
In our opinion, the Growth Shares, when purchased in accordance
with the Plan, will be legally issued, fully paid and non-assessable Growth
Shares of the Company.
The statements in the Prospectus (included in the Registration
Statement) under the caption "Federal Income Tax Consequences," insofar
as such statements constitute conclusions of federal income tax law, are
true and correct in all material respects. Specifically, for federal income
tax purposes, the Company will be classified as a partnership and it will
not be treated as a publicly traded partnership that is taxable as a
corporation.
We hereby consent to the use of this opinion as Exhibit 5.1 to the
Registration Statement. In giving such consent, we do not thereby admit
that we are acting within the category of persons whose consent is
required under Section 7 of the Act or the rules or regulations of the
Securities and Exchange Commission thereunder.
Very truly yours,
/s/ Brown & Wood LLP
Exhibit 23.1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Prospectus
constituting part of this Registration Statement on Form S-3 of our report
dated February 19, 1997 appearing in Part IV, Item 14 of Municipal
Mortgage and Equity, L.L.C.'s Annual Report on Form 10-K for the year
ended December 31, 1996. We also consent to the reference to us under
the heading "Experts" in such Prospectus.
/s/ Price Waterhouse LLP
PRICE WATERHOUSE LLP
Linthicum, Maryland
August 28, 1997
Exhibit 99.1
AUTHORIZATION FORM
FOR
AUTOMATIC DIVIDEND
REINVESTMENT SERVICE
MUNICIPAL MORTGAGE AND EQUITY, L.L.C.
<PAGE>
A CONVENIENT WAY TO BUY ADDITIONAL GROWTH SHARES
There's a simple and convenient way to buy additional Growth Shares
of Municipal Mortgage and Equity, L.L.C. (the "Company"). It's called
dividend reinvestment.
As a Company shareholder, you can use dividend reinvestment to
purchase Growth Shares without a brokerage firm.
Dividend reinvestment puts your dividends to work for you by
reinvesting them in additional Growth Shares.
DIVIDENDS ARE INVESTED AUTOMATICALLY
When you enroll in dividend reinvestment, your dividends will be
invested automatically - you don't have to do anything!
Instead of sending dividend payments to you, your dividends will be
used to buy additional Growth Shares for your account.
The number of Growth Shares you buy through dividend reinvestment
depends on the number of Growth Shares you own and the current market
price of the Growth Shares. Since your dividends will seldom buy an
exact number of full Growth Shares, you are credited with fractional
shares, which earn dividend income just like full Growth Shares.
EASY RECORD-KEEPING
After you enroll, you will receive a quarterly statement listing each of
your investments. The statement shows the Growth Shares that have been
purchased for you, and the cost and the total Growth Shares that you
currently own through dividend reinvestment.
You also will receive year-end tax information.
One additional benefit is that, by Registrar and Transfer Company
holding the Growth Shares purchased through dividend reinvestment on
your behalf, you are protected against lost, misplaced or stolen
certificates. However, if you request it in writing, you can receive a
certificate for the full Growth Shares.
CALL OR WRITE FOR ANSWERS!
Municipal Mortgage and Equity, L.L.C.'s Dividend Reinvestment and
Growth Share Purchase Plan is administered by Registrar and Transfer
Company, agent for the plan. All questions, inquiries or communications
should be addressed to:
Registrar and Transfer Company
10 Commerce Drive
Cranford, NJ 07016
1-800-368-5948
or
Municipal Mortgage and Equity, L.L.C.
218 North Charles Street, Suite 500
Baltimore, MD 21201
1-888-788-3863
IT'S UP TO YOU
You may withdraw from the plan at any time simply by notifying
Registrar and Transfer Company in writing. After receipt of your written
notice you will begin receiving your dividends by check, just as you do
now.
You also will receive certificates, issued in your name, for all full
Growth Shares that were purchased through dividend reinvestment and
cash for any fraction of a share. This cash amount is based on the current
market value of Municipal Mortgage and Equity, L.L.C.'s Growth Shares.
Notice of termination should be received by Registrar and Transfer
Company 15 days prior to a dividend record date to avoid any possible
delay in receiving your Growth Shares.
ENROLLING IS EASY
To enroll in dividend reinvestment, simply read the prospectus
describing the plan, complete the attached authorization card and return it
in the postage-paid envelope.
If your signed authorization card is received at least seven business
days prior to the next dividend record date, your dividend will be
reinvested automatically. If your authorization card is received after that
date your participation in the plan will begin with the next dividend.
Completion and return of this form appoints Registrar and Transfer
Company as your agent and authorizes your enrollment in the Dividend
Reinvestment and Growth Share Purchase Plan in the manner indicated.
PLEASE DO NOT RETURN THIS FORM
UNLESS YOU INTEND TO PARTICIPATE IN THE PLAN
FULL DIVIDEND REINVESTMENT - If you participate, you
will authorize the purchase of additional shares with the dividends on all
Growth Shares registered in your name, as well as the Growth Shares
credited to your reinvestment account.
Your participation is subject to the terms of the Plan as
described. You may withdraw from the Plan at any time by notifying
Registrar and Transfer Company in writing. Please direct all
correspondence to:
Registrar and Transfer Company
10 Commerce Drive
Cranford, NJ 07016
THIS IS NOT A PROXY.
<PAGE>
MUNICIPAL MORTGAGE AND EQUITY, L.L.C.
DIVIDEND REINVESTMENT AND GROWTH SHARE PURCHASE PLAN
AUTHORIZATION CARD
Full Dividend Reinvestment
__ I want to reinvest dividends on all shares registered in my name
and held for my account in the Plan.
Please enroll me in the Plan as indicated above.
__________________________________________
(Print Name)
Tax ID# (For Account ID Only):
____________________________ ___________________________________________
(Sign here exactly as name appears on stock)
___________________________________________
(All stockholders must sign)
PLEASE DO NOT RETURN THIS FORM
UNLESS YOU INTEND TO PARTICIPATE IN THE PLAN
This is not a Proxy.
