CHARTERMAC

Charter of the Conflicts Committee of the Board of Trustees

 

I. PURPOSE

The Conflicts Committee is established by the Board of Trustees (the "Board") for the primary purpose of reviewing, overseeing and approving:

The Conflicts Committee should encourage continuous improvement of, and should foster adherence to, the Company's policies, procedures and practices regarding transactions with Affiliates. The Conflicts Committee shall also ensure that management's contemplated transactions with Affiliates meet the criteria of the Company's governing documents.

The Conflicts Committee has the authority to obtain advice and assistance from outside legal, accounting or other advisors as deemed appropriate to perform its duties and responsibilities. The Company shall provide appropriate funding, as determined by the Conflicts Committee, for compensation to any advisors that the Conflicts Committee chooses to engage.

The Conflicts Committee will primarily fulfill its responsibilities by carrying out the activities enumerated in Section III of this Charter. The Conflicts Committee will report regularly to the Board regarding the execution of its duties and responsibilities.

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II. COMPOSITION AND MEETINGS

The Conflicts Committee shall be comprised of at least three Managing Trustees or such higher number as determined by the Board.

The members of the Conflicts Committee shall be elected by the Board at the annual meeting (or by written consent). The members of the Conflicts Committee may designate a chairperson by majority vote of the members of the Conflicts Committee. Conflicts Committee members may be removed and replaced by, and in the sole discretion of, the Board by majority vote. Simultaneous service on more than one of the Company's committees will not impair the ability of any Managing Trustee to effectively serve on the Conflicts Committee.

The Conflicts Committee shall meet as circumstances dictate. The Secretary or an Assistant Secretary of the Company, or a designee thereof, or another person designated by the Conflicts Committee acting in coordination with the Secretary of the Company, shall record minutes of all Conflicts Committee meetings, and such minutes shall be maintained with the books and records of the Company. The Conflicts Committee shall report to the Board at the regularly scheduled quarterly meeting regarding any meetings of the Committee that took place in the prior quarter and at such other times as the Conflicts Committee members deem necessary or appropriate. In addition, as part of the Conflicts Committee's responsibility to foster open communication, the Conflicts Committee should meet periodically with management to discuss any matters that the Conflicts Committee or management believe should be discussed.

The Conflicts Committee may fix such additional rules or procedures for the conduct of its business pursuant to this Charter as the Conflicts Committee members deem necessary or appropriate. Any such additional rules or procedures shall be consistent with the Company's Trust Agreement and By-Laws and this Charter, in each case as in effect from time to time, and shall be filed with this Charter in the books and records of the Company.

The Conflicts Committee may form and delegate authority to subcommittees when and as the Conflicts Committee deems necessary and appropriate, except as may be otherwise provided by this Charter.

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III. COMMITTEE OPERATING PROCEDURES

To fulfill its responsibilities and duties, the Conflicts Committee shall:

1.       Review and assess the adequacy of this Charter at least annually and recommend to the Board for approval any necessary amendments as conditions dictate.

2.       Review, monitor and approve transactions with Affiliates; including, but not limited to, direct lending transactions, direct acquisition transactions, transactions which implicate fiduciary duty obligations of CharterMac or its subsidiaries in connection with any of their fund management activities, any transaction in which a trustee or officer has a direct or indirect personal interest, compliance with the Future Relations Agreement between CharterMac and The Related Companies, L.P., and disputes that may arise from any of the agreements related to the Company's acquisition of Related Capital Company . The Conflicts Committee may, in its discretion, request that the Board review and approve specific Affiliate transactions.

3.       Adopt, as necessary in the discretion of the Conflicts Committee, policies with respect to transactions with Affiliates.

4.       Require management to provide it with at least quarterly reports which set forth all transactions with Affiliates since the prior report.

5.       Have authority to obtain advice and assistance from internal or external financial, legal, accounting or other advisors.

6.       Review annually its own performance.

7.       Have such additional authority, duties and responsibilities as may be granted or assigned to the Conflicts Committee by the Board from time to time or as may be designated in any documents governing the Company.

Initial Members of the Conflicts Committee: Thomas White (Chairman), Peter Allen, and Robert Meister.

"Affiliate" shall mean (i) any officer, trustee, director, member, partner, employee or controlling shareholder of CharterMac or any of its subsidiaries; (ii) any individual or entity ("Person") controlling, controlled by or under common control with any individual described in (i) above; (iii) any officer, director, trustee, general partner or employee of any Person described in (ii) above; and (iv) any Person who is a member, other than as limited partner or non-managing member, with any Person described in (i) and (ii) above in a relationship of joint venture, partnership, limited liability company or similar form of unincorporated business association.