SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934
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AMERICAN MORTGAGE ACCEPTANCE COMPANY
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AMERICAN MORTGAGE
ACCEPTANCE COMPANY
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
on
June 9, 2004
-------------
April 30, 2004
To the Shareholders of American Mortgage Acceptance Company:
NOTICE IS HEREBY GIVEN THAT the 2004 annual meeting of the holders of
the common shares of beneficial interest of American Mortgage Acceptance Company
("our Company") will be held on Wednesday, June 9, 2004 at 10:00 A.M. (local
time), at the law offices of Paul, Hastings, Janofsky & Walker LLP, 75 East 55th
Street, New York, New York for the following purposes:
(1) The election of five (5) trustees for a term of one year to
expire in 2005;
(2) The approval of an amendment to our Company's Second Amended and
Restated Declaration of Trust to remove the $10,000 limitation
on independent trustee compensation and give our board of
trustees the discretion to set appropriate compensation levels;
(3) The approval of an amendment to our Company's Amended and
Restated Incentive Share Plan to (i) increase the overall number
of options that are available under the plan to an amount equal
to 10% of our Common Shares outstanding from time to time and
(ii) remove the annual 3% maximum on the issuance of options;
(4) The adjournment or postponement of the annual meeting if
necessary to permit further solicitation of proxies if there are
not sufficient votes at the time of the annual meeting to
approve the proposals;
(5) The transaction of such other business as may properly come
before the meeting.
Our board of trustees recommends a vote "FOR" each of the proposals. The
accompanying proxy statement contains additional information and should be
carefully reviewed by shareholders.
Our board of trustees has fixed the close of business on April 16, 2004
as the record date for the determination of shareholders entitled to notice of
and to vote at the meeting and any adjournment or postponement thereof.
By Order of the Board of Trustees
/s/ Stuart J. Boesky
Stuart J. Boesky
President and Chief Executive Officer
IT IS MOST IMPORTANT THAT YOU SUBMIT YOUR PROXY EITHER BY MAIL, TELEPHONE OR ON
THE INTERNET BY FOLLOWING THE INSTRUCTIONS ON THE PROXY CARD. IF YOU DECIDE TO
DO SO BY MAIL, PLEASE COMPLETE, DATE, SIGN AND RETURN THE ENCLOSED STAMPED,
SELF-ADDRESSED PROXY CARD.
YOUR FAILURE TO PROMPTLY RETURN THE PROXY INCREASES THE OPERATING COSTS OF YOUR
INVESTMENT.
YOU ARE CORDIALLY INVITED TO PERSONALLY ATTEND THE MEETING, BUT YOU SHOULD VOTE
BY PHONE, INTERNET OR MAIL WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING.
2
AMERICAN MORTGAGE ACCEPTANCE COMPANY
625 MADISON AVENUE
NEW YORK, NEW YORK 10022
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PROXY STATEMENT
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ANNUAL MEETING OF SHAREHOLDERS
INTRODUCTION
The accompanying form of proxy is solicited on behalf of the board of
trustees of American Mortgage Acceptance Company (which we refer to as "our
Company," "we," "our" or "us") for use at the annual meeting of shareholders to
be held Wednesday, June 9, 2004 at 10:00 A.M. (local time), at the law offices
of Paul, Hastings, Janofsky & Walker LLP, 75 East 55th Street, New York, New
York, and at any adjournment or postponement thereof. On or about April 30,
2004, we first mailed these proxy materials to holders of record of our common
shares at the close of business on April 16, 2004. Our executive offices are
located at 625 Madison Avenue, New York, New York 10022 (telephone: (212)
588-1765).
Common shares represented by properly executed proxy cards received by
us at or prior to the annual meeting will be voted according to the instructions
you indicate on the proxy card. If you do not give any instructions, the persons
named on your signed proxy card intend to vote your common shares so represented
"FOR" each of the proposals.
You may revoke your proxy and reclaim your right to vote by (i)
delivering to our secretary a written notice of revocation bearing a later date
than the date of the proxy at or prior to the annual meeting, (ii) delivering to
our secretary a duly executed, subsequently dated proxy with respect to the same
common shares at or prior to the annual meeting, or (iii) attending the annual
meeting and voting in person, although attendance at the annual meeting will
not, by itself, constitute revocation. Any written notice revoking a proxy
should be delivered at or prior to the annual meeting to the attention of the
Secretary, American Mortgage Acceptance Company, 625 Madison Avenue, New York,
New York 10022.
Our board of trustees recommends a vote "FOR" each of the proposals.
As of April 16, 2004, approximately 8,338,180 common shares were
outstanding, with each common share entitled to one vote on all matters that
may come before the annual meeting.
RECENT DEVELOPMENTS
On November 17, 2003, CharterMac, a Delaware statutory trust (AMEX:CHC),
acquired the indirect ownership of our advisor, Related AMI Associates, Inc.
("our Advisor"), in connection with CharterMac's acquisition of all of the
ownership interests of, and substantially all of the business operated by,
Related Capital Company, LLC ("RCC"). As a result of the acquisition, two of our
independent trustees, Peter T. Allen and Arthur P. Fisch, who are members of
CharterMac's board of trustees, were no longer considered to be "independent"
(as defined in our Declaration of Trust). Since our Declaration of Trust
requires that a majority of our board of trustees be independent, Mr. Allen and
Mr. Fisch voluntarily resigned from our board of trustees as of January 17,
2004.
On January 28, 2004, in accordance with our Declaration of Trust which
provides that a majority of remaining trustees may fill vacancies caused by the
resignation of a trustee, Mr. Richard Rosan and Mr. Stanley Perla were appointed
as independent trustees of our Company to fill the remaining terms of Messrs.
Allen and Fisch. Messrs. Rosan and Perla are both up for election for one-year
terms expiring in 2005. See "Proposal #1: Election of Trustees," below.
PROPOSALS BEFORE THE MEETING
Proposal #1: Election of Trustees
At the annual meeting, five trustees are to be elected for one-year
terms expiring in 2005. All of the nominees are currently trustees of our
Company. Trustees are elected by a plurality of the votes cast (assuming the
presence of a quorum consisting of a majority of holders of our common shares,
whether present in person or by proxy).
Unless holders of our common shares otherwise specify, the common shares
represented by duly executed proxies will be voted "FOR" the indicated nominees
for election as trustees. Our board of trustees has no reason to believe that
any of the nominees will be unable or unwilling to continue to serve as a
trustee if elected. However, in the event that any nominee should be unable or
unwilling to serve, the common shares represented by proxies received will be
voted for another nominee selected by our board of trustees. Our board of
trustees recommends a vote "FOR" each of the listed nominees.
The following table sets forth information with respect to each nominee
nominated to serve as a trustee for a term to expire in 2005.
Name of Trustee/
Nominee for Election Age Principal Occupation
-------------------- --- --------------------
Stuart J. Boesky 47 Mr. Boesky is Chairman, the President and Chief Executive
Officer of our Company and is the President and Director
of our Advisor. Mr. Boesky is also the Chief Executive
Officer of CharterMac, Chairman of PW Funding Inc. and
Managing Director of RCC, two of CharterMac's
subsidiaries. Mr. Boesky is responsible for our
strategic planning and new business development. He
oversees all of CharterMac's and our Company's debt
products, including CharterMac's portfolio investing and
mortgage banking operations, capital markets, strategic
planning and new product development. Mr. Boesky
practiced real estate and tax law with the law firm of
Shipley & Rothstein from 1984-1986, when he joined RCC.
From 1983-1984, he practiced law with the Boston office of
Kaye, Fialkow, Richman and Rothstein. Previously, Mr.
Boesky was a consultant at the accounting firm of
Laventhol & Horwath. Mr. Boesky graduated with high honors
from Michigan State University with a Bachelor of Arts
degree and from Wayne State School of Law with a Juris
Doctor degree. He then received a Master of Laws degree
in Taxation from Boston University School of Law. Mr.
Boesky is a regular speaker at industry conferences and on
television. Mr. Boesky is also a member of the board of
directors of the National Association of Affordable
Housing Lenders and the Investment Program Association.
Alan P. Hirmes 49 Mr. Hirmes is a managing trustee and the interim Chief
Operating Officer of our Company and is the Senior Vice
President of our Advisor. Mr. Hirmes is also a Managing
Trustee and the Chief Operating Officer of CharterMac, the
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President of RCC and a Board member of PW Funding. Mr.
Hirmes is responsible for managing the overall
administration of CharterMac, RCC and the Company, as well
as any new initiatives or special projects. In addition,
Mr. Hirmes oversees RCC's human resources, information
technology and investor services departments and the joint
venture development program. Mr. Hirmes has been a
Certified Public Accountant in New York since 1978. Mr.
Hirmes currently serves as Chairman Emeritus of the
Affordable Housing Tax Credit Coalition, a national
organization dealing with issues relating to the Tax
Credit Program. He is also a member of the Advisory Board
of the Low Income Housing Tax Credit Monthly Report and of
the National Housing Conference, and he serves on the
Executive Board of the National Multi Housing Council.
Prior to joining RCC in October 1983, Mr. Hirmes was
employed by Weiner & Co., certified public accountants,
where he specialized in real estate and partnership
taxation. Mr. Hirmes graduated from Hofstra University
with a Bachelor of Arts degree. Mr. Hirmes will become
our Chief Financial Officer and CharterMac's Chief
Financial Officer on March 31, 2004, upon the resignation
of Stuart Rothstein.
Scott M. Mannes 44 Mr. Mannes is an Independent Trustee. Mr. Mannes is a
Managing Director of the Norseman Group, LLC, which is a
credit focused mezzanine lender to single tenant property
owners. Prior to Norseman, Mr. Mannes was a principal of
Drawbridge Capital, LLC, a company providing consulting
services to specialty and consumer finance companies.
Prior to Drawbridge, Mr. Mannes was a key participant in
the development and evolution of the investment banking
and merchant banking operations during his nine-year
tenure at ContiFinancial Corporation, most notably as
Co-President of ContiFinancial Services Corporation. Prior
to joining ContiFinancial in 1990, Mr. Mannes spent seven
years with Financial Guaranty Insurance Company,
developing the first financial guaranties applied to
sub-prime mortgage loan securitizations. Mr. Mannes is a
graduate of Statue University at Albany and received a
Master of Public Administration degree from the
Rockefeller School of Public Affairs and Policy at SUNY
Albany. Mr. Mannes is a member the audit committee, the
nominating and governance committee and the compensation
committee.
Stanley Perla 60 Mr. Perla is an Independent Trustee. Mr. Perla, a
licensed Certified Public Accountant, was with the firm of
Ernst & Young LLP for 35 years, the last 25 of which he
was a partner. His area of expertise for the past 40
years was real estate, and he was also responsible for the
auditing of public and private companies. Mr. Perla
served as Ernst & Young's National Director of Real Estate
Accounting, as well as on Ernst & Young's National
Accounting and Auditing Committee. He is an active member
of the National Association of Real Estate Investment
Trusts and the National Association of Real Estate
Companies. Mr. Perla also served on the real estate
committees of the New York State
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Society of Certified Public Accounts and the American
Institute of Certified Public Accountants. In addition,
Mr. Perla has been a frequent speaker on real estate
accounting issues at numerous real estate conferences. He
is currently on the Board of Trustees and Chairman of the
Audit Committee of Lexington Corporate Properties Trust
and is a Vice President and the Director of Internal Audit
of Vornado Realty Trust. Mr. Perla is the chairman of the
audit committee and is a member of the nominating and
governance committee.
Richard M. Rosan 62 Mr. Rosan is a Trustee of our Company and is the President
of the Urban Land Institute ("ULI"), a post he has held
since 1992. ULI, a globally focused organization with an
international membership of over 20,000 real estate
professionals, is considered the preeminent "think tank"
in land use development. In addition to the duties of
leading ULI, Mr. Rosan is also the President of the ULI
Foundation, the philanthropic arm of the Urban Land
Institute. Mr. Rosan is an architect and Fellow of the
American Institute of Architects. Prior to his service at
ULI, Mr. Rosan spent 22 years in New York City in several
capacities including 12 years with the City of New York,
ending as its Economic Development Director, six years as
President of the Real Estate Board of New York, and five
years in the private development business working as
Project Director on several large New York City
development projects. Mr. Rosan holds a B.A. from
Williams College and a Masters of Architecture from The
School of Architecture at the University of Pennsylvania.
He completed Post Graduate work in Urban Planning at the
University of Cambridge, England. Mr. Rosan is a member
of both the audit and compensation committees.
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Proposal #2: Amendment of Declaration of Trust to Remove Limitation on
Independent Trustee Compensation
Our board of trustees has approved, and recommends that you authorize
them to adopt and execute, an amendment to our Company's Second Amended and
Restated Declaration of Trust (the "Declaration of Trust") to remove the
limitation on compensation payable to our independent trustees.
Our Declaration of Trust currently provides that the maximum
compensation our independent trustees may receive is $10,000 per year for
serving on our board of trustees. If the proposal is approved, we would amend
our Declaration of Trust by removing the $10,000 limitation on independent
trustee compensation and giving the board discretion to set appropriate
compensation levels.
Overview
Section 4.8 of our Declaration of Trust currently limits the amount of
compensation independent trustees may receive for service on our board of
trustees to $10,000 per year. This $10,000 limit on independent trustee
compensation has been in our Declaration of Trust since we commenced operations
in 1993. Since then, trustee and director compensation rates have increased,
particularly recently in the wake of the additional responsibilities placed on
independent trustees by the passage of the Sarbanes-Oxley Act of 2002. Our
Advisor conducted a survey of five other mortgage REITs with similar equity
market capitalizations to our Company, which indicated that the annual
compensation we pay to our independent trustees was below the current market
rate. In particular, annual compensation for the five surveyed REITs ranged from
$15,000 to $30,000.
In recognition of the current market-standard for independent trustee
compensation, we believe that the $10,000 restriction should be removed in order
to (i) allow us to set compensation for independent trustees at a level
competitive with compensation paid to individuals in comparable positions in
other public companies of similar size to ours and (ii) attract and retain
qualified individuals to serve as independent trustees. Removing the current
limitation on independent trustee compensation and providing our board of
trustees with the authority to set compensation for independent trustees at an
appropriate level will enable us to have the capability to attract and retain
qualified persons to adequately represent our shareholders as independent
trustees.
Effect of Amendment
Section 4.8 currently reads as follows:
"COMPENSATION. Independent Trustees shall be entitled to receive
compensation for serving as Trustees at the rate of $10,000 per year.
Additionally, Independent Trustees shall be reimbursed for travel expenses
and other out-of-pocket disbursements incurred in connection with attending
any meetings. Non-Independent Trustees shall not receive any compensation
from the Trust. Nothing herein shall be construed to preclude any
Non-Independent Trustee from serving the Trust in any other capacity as an
officer, agent or otherwise, and receiving compensation therefor.
Independent Trustees shall not perform any services for the Trust except as
Trustees."
As amended, Section 4.8 will read as follows:
"COMPENSATION. Independent Trustees may receive fixed sums, Common Shares
in the Trust or other compensation per year and/or per meeting and/or for
any service or activity they perform or engage in as Trustees, as
determined by resolution of the Board of Trustees. Additionally,
Independent Trustees shall be reimbursed for travel expenses and other
out-of-pocket disbursements incurred in connection with attending any
meetings. Non-
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Independent Trustees shall not receive any compensation from the Trust.
Nothing herein shall be construed to preclude any non-Independent Trustee
from serving the Trust in any other capacity as an officer, agent or
otherwise, and receiving compensation therefor. Independent Trustees shall
not perform any services for the Trust except as Trustees."
The effect of the proposed amendment would be the elimination of the
$10,000 limitation on independent trustee compensation. By virtue of this
change, our board of trustees will have the flexibility and discretion to
determine the appropriate level of compensation in any given year.
The affirmative vote of the holders of a majority of the outstanding
common shares entitled to vote will be required to approve this amendment to our
Declaration of Trust.
Our board of trustees has unanimously approved the amendment to our Declaration
of Trust and recommends that you vote "FOR" the approval and adoption of the
amendment.
Proposal #3: Expansion of our Amended and Restated Incentive Share Option Plan
Our board of trustees has approved, and recommends that you authorize
them to adopt and implement, an amendment to our Company's Incentive Share
Option Plan (the "Plan") to (i) increase the overall number of options that are
available under the Plan to an amount equal to 10% of our common shares
outstanding from time to time and (ii) remove the annual 3% maximum on the
issuance of options. Other than these two amendments, we are not proposing to
change any other terms of the Plan.
As of the date of this proxy, we have 193,863 common shares available
for grant under the Plan. We feel that it is important for our future growth to
provide incentives to our current management team as well as to attract and
permit our Advisor to attract additional executives through the granting of
share options, and we are asking you to approve expanding the Plan to increase
the amount of options that may be granted each year and over the life of the
Plan.
A description of our current incentive share option plan may be found
under the heading "Executive Compensation - Share Option Plan" on page 16 of
this proxy statement.
Background
Our board of trustees adopted our existing Plan to attract and retain
qualified individuals to serve as trustees, officers and/or employees of our
Company and our Advisor, as well as to align the financial interests of these
individuals with the interests of our common shareholders generally (i.e., by
providing them with substantial financial interests in our success). Our
compensation committee, which is comprised of our independent trustees,
administers the Plan. Our board of trustees believes that our Plan has helped us
attain these desired results and is asking you to vote in favor of the proposed
amendments to our Plan which, if approved, would increase the amount of options
available under the Plan and allow for the continued operation of the Plan.
Our existing Plan restricts the amounts of incentive awards which may be
granted in two ways. First, it provides that options for no more than 383,863
options to purchase common shares may be granted over the life of the Plan (the
"Life Maximum"), which was equal to 10% of the number of our common shares
outstanding at the time of our restructuring in July, 1999. Second, it provides
that, assuming our distributions per common share in the immediately preceding
calendar year exceed $1.45 per common share, we may only grant options to
purchase, in the aggregate, that number of common shares which is equal to 3% of
any shares of beneficial interest outstanding as of December 31 of the
immediately preceding calendar year (the "Annual Maximum").
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Other than the proposed modification to the Life Maximum and the
elimination of the Annual Maximum, we are not proposing to change other terms of
our Plan. Therefore, the requirements that (a) the exercise price of the options
granted under the plan may not be less than the fair market value of our common
shares on the date of grant; (b) the options have a maximum term of 10 years;
and (c) options may only be granted if the distribution for the year prior to
the grant year exceeds $1.45 per common share, will remain unchanged.
Proposed Amendment to Life Maximum
Overview
Our board of trustees believes that it is in our best interests to
increase the Life Maximum to 10% of the aggregate number of common shares
outstanding as of December 31 of the immediately preceding calendar year
(subject to any limitations imposed by the national securities exchange or
national quotation system upon which the Company is listed), which our
management believes is generally the norm for other public companies of similar
size to ours.
If the amendment is approved by the requisite vote of the holders of our
common shares, the current Life Maximum will be eliminated and our board of
trustees will amend the incentive share option Plan to provide for a new Life
Maximum that will be capped at the lesser of (1) 10% of the aggregate number of
common shares outstanding on the date each option is granted and (2) the limit
prescribed by the Listing Standards, Policies and Requirements of the American
Stock Exchange, as amended from time to time (the "AMEX Rules") or any other
policies and requirements of any other national securities exchange or national
quotation system on which the Company is then listed.
Effect of Amendment
The effect of the change would be the imposition of a new cap on the
issuance of options over the life of the Plan that would be more flexible than
its predecessor (insofar as it would be tied to the growth of our Company).
Nevertheless, in no event could we, or our board of trustees (or any committee
thereof) increase the new Life Maximum without obtaining shareholder approval.
Section 4 currently reads as follows:
4. Shares Subject to Plan
Subject to adjustment as provided in Sections 13 and 14 below, the
maximum number of Shares that may be issued and sold pursuant to Options
granted under the Plan is ten (10%) percent of the number of Shares
issued and outstanding on the date the Proposals are approved.
The Company shall reserve for issuance, for the purposes of the Plan,
out of its authorized but unissued Shares or out of Shares held in the
Company's treasury, or partly out of each, such number of Shares as
shall be determined, from time to time, by the Committee. If Options
granted under the Plan shall expire or terminate for any reason without
having been exercised in full, the Shares subject to the unexercised
portions of such Options shall again be available for subsequent Award
grants under the Plan. Shares issuable upon exercise of Options shall be
subject to such restrictions on transfer, repurchase rights or other
restrictions as may be determined by the Committee.
As amended, Section 4 will read as follows (strike-through indicates
deletions, double underline indicates additions):
4. Shares Subject to Plan
9
(a) Maximum Number. Subject to adjustment as provided in Sections 13 and
14 below, the maximum number of Shares that may be issued and sold
pursuant to Options granted under the Plan is (determined at the time
each Option is granted) is the lesser of:
(i) ten (10%) percent of the number of Shares outstanding on the date
each Option is granted; and (ii) the limit prescribed by the Listing
Standards, Policies, and Requirements of the American Stock Exchange, as
amended from time to time, or any other applicable policies and
requirements of any other national securities exchange or national
quotation system on which the Shares are then listed.
(b) Reservation of Shares. The Company shall reserve for issuance, for
the purposes of the Plan, out of its authorized but unissued Shares or
out of Shares held in the Company's treasury, or partly out of each,
such number of Shares as shall be determined, from time to time, by the
Committee. If Options granted under the Plan shall expire or terminate
for any reason without having been exercised in full, the Shares subject
to the unexercised portions of such Options shall again be available for
subsequent Award grants under the Plan. Shares issuable upon exercise of
Options shall be subject to such restrictions on transfer, repurchase
rights or other restrictions as may be determined by the Committee.
As of the date of this proxy statement, if the amendment is approved,
the Life Maximum will be increased from 383,863 common shares to 833,8180 common
shares based upon the current outstanding amount of common shares, as this
amount may be increased from time to time as a result of an increase in the
aggregate number of outstanding common shares.
Elimination of Annual Maximum
Overview
The Annual Maximum limitation in our current Plan restricts our ability
to grant options to purchase, in the aggregate, more than 3% of any shares of
beneficial interest outstanding as of December 31 of the immediately preceding
calendar year. Our board of trustees feels that our Company requires the ability
to provide additional incentives to all of our personnel which will further
align the interests of our and/or our Advisor's employees with our shareholders.
Our board of trustees believes this will maximize value for our shareholders
and, therefore, believes that it is in our best interests to eliminate the
Annual Maximum.
Effect of Amendment
The effect of this amendment would be the elimination of the restriction
on our compensation committee to grant options to purchase more than 3% of any
shares of beneficial interest outstanding as of December 31 of the immediately
preceding calendar year. This change will more closely align our plan with
incentive share plans of other public companies of similar size to ours, and
assist us in attracting and retaining individuals to serve as trustees, officers
and/or employees of our Company or our Advisor. By virtue of this change, the
compensation committee of our board of trustees will have the flexibility and
discretion, subject to the Life Maximum, to determine the appropriate levels of
option grants in any given year.
Section 6(b) currently reads as follows:
(b) Share Limitation. Subject to the limitation set forth in Section 4,
if the Company's distributions per Share from cash available for
distributions ("CAD") in the immediately preceding calendar year exceed
$1.45 per Share, the Committee will have the authority to issue Options
to purchase, in the aggregate, that number of Shares which is equal to
three (3%) percent of the Shares outstanding as of December 31 of the
immediately preceding
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calendar year. If the Committee does not grant the maximum number of
Options in any year, the excess of the number of authorized Options
which the Committee could have granted over the number of Options
actually granted in such year will be added to the number of Options
which the Committee is authorized to grant in the next succeeding year
and will be available for grant to Participants by the Committee in such
succeeding year. "CAD" shall mean cash available for distribution, which
shall consist of the Company's net income (as determined pursuant to
GAAP) adjusted for certain non-cash charges (as determined pursuant to
GAAP).
As amended, Section 6(b) will read as follows (strike-through indicates
deletions, double underline indicates additions):
(b) Share Limitation. Subject to the limitation set forth in Section 4,
if the Company's distributions per Share from cash available for
distributions ("CAD") in the immediately preceding calendar year exceed
$1.45 per Share, the Committee will have the authority to issue Options.
"CAD" shall mean cash available for distribution, which shall consist of
the Company's net income (as determined pursuant to GAAP) adjusted for
certain non-cash charges (as determined pursuant to GAAP).
The affirmative vote of a majority of the votes cast will be required to
approve these amendments to our Incentive Share Option Plan.
Our board of trustees has unanimously approved the amendments to our
Incentive Share Option Plan and recommends that you vote "FOR" the approval and
adoption of the amendments.
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MANAGEMENT
Our board of trustees directs the management of the business of our
Company but retains our Advisor to manage our day-to-day affairs. Our Advisor is
indirectly owned by CharterMac. Our board of trustees delegates to our Advisor
responsibilities with respect to, among other things, overseeing our portfolio
of assets and acquiring and disposing of investments.
Meetings and Attendance
During 2003, our board of trustees held fourteen meetings, the audit
committee held four meetings and the compensation committee held one meeting.
The average attendance in the aggregate of the total number of board of trustees
and committee meetings was 79%, and no trustee attended fewer than 75% of the
aggregate of all meetings of the board of trustees and applicable committee
meetings.
Our Company does not have a formal policy requiring trustees to be
present at annual meetings, although we do encourage their attendance. All of
our then trustees attended the 2003 annual meeting.
Trustees and Executive Officers
The trustees and executive officers of our Company are as follows:
Year First Became
Name Age Office Held Officer/Trustee Term Expires
---- --- ----------- --------------- ------------
Stuart J. Boesky 47 Chairman of the Board,
Chief Executive Officer and
President 1991 2004
Alan P. Hirmes 49 Managing Trustee and
Interim Chief Operating Officer(1) 1991 2004
Scott M. Mannes 44 Managing Trustee (Independent) 2001 2004
Stanley Perla 60 Managing Trustee (Independent) 2004 2004
Richard Rosan 62 Managing Trustee (Independent) 2004 2004
Stuart A. Rothstein 38 Executive Vice President &
Chief Financial Officer(2) 2002 --
Denise L. Kiley 44 Senior Vice President 1999 --
Marc D. Schnitzer 43 Senior Vice President 1999 --
Biographical information with respect to Messrs. Boesky, Hirmes, Mannes, Perla
and Rosan is set forth under "PROPOSALS BEFORE THE MEETING; Proposal #1:
Election of Trustees " above.
DENISE L. KILEY is a Senior Vice President of our Company. Ms. Kiley is a
Managing Trustee and the Chief Credit Officer of CharterMac, the Chief Operating
Officer of RCC and a member of the board of directors of PW Funding Inc. Ms.
Kiley is the Director of the Asset Management and Underwriting Divisions, where
she is responsible for overseeing the due diligence and asset management of all
--------
1 Mr. Hirmes will become the Chief Financial Officer of our Company on March 31,
2004 upon the resignation of Stuart Rothstein.
12
multifamily residential properties invested in by CharterMac, our Company and
RCC. Prior to joining RCC in 1990, Ms. Kiley was a First Vice President with
Resources Funding Corporation, where she was responsible for acquiring,
financing, and asset managing multifamily residential properties. From 1981-1985
she was an auditor with Price Waterhouse. Ms. Kiley is a Member of the Advisory
Committee for the Joint Center for Housing at Harvard University; she is on the
Multifamily Leadership Board for the National Association of Home Builders; and
she is a member of the National Housing & Rehabilitation Association. Ms. Kiley
received a Bachelor of Science degree in accounting from The Carroll School of
Management at Boston College.
MARC D. SCHNITZER is a Senior Vice President of our Company. Mr. Schnitzer is a
Managing Trustee and President of CharterMac, the Chief Executive Officer of RCC
and a member of the board of directors of PW Funding Inc. Mr. Schnitzer directs
RCC's Tax Credit Group, which has invested in excess of $4.5 billion in
affordable housing tax credit properties since 1987. Mr. Schnitzer is also
responsible for structuring and marketing RCC's institutional tax credit
offerings. Mr. Schnitzer is a member of the executive committee of the board of
directors of the National Multi Housing Council and a Vice President and member
of the Executive Committee of the Affordable Housing Tax Credit Coalition. He is
a frequent speaker at industry conferences sponsored by the National Council of
State Housing Agencies and the National Housing and Rehabilitation Association.
Mr. Schnitzer joined RCC in 1988 after receiving a Master of Business
Administration degree from The Wharton School of The University of Pennsylvania
in December 1987. From 1983-1986, Mr. Schnitzer was a Financial Analyst in the
Fixed Income Research Department of The First Boston Corporation, an
international investment bank. Mr. Schnitzer received a Bachelor of Science
degree, summa cum laude, in Business Administration from the School of
Management at Boston University in 1983.
Other Officers of Our Company
Other officers of our Company are as follows:
JOHN J. SOREL, 43, is a Senior Vice President of our Company and is a Senior
Vice President of RCC. Mr. Sorel is responsible for overseeing construction risk
management and loan servicing for us. Prior to joining RCC in November 1999, Mr.
Sorel was a Vice President for BankBoston in its real estate department from
1993-1999, where he originated and managed over $150 million of corporate and
construction loan facilities for the low-income housing tax credit industry.
From 1991-1993, Mr. Sorel worked as an Assistant Vice President for Recoll
Management. Mr. Sorel holds a Bachelor of Arts degree in economics from Syracuse
University.
MARK J. SCHLACTER, 53, is a Vice President of our Company and is responsible for
our mortgage acquisition programs. Mr. Schlacter is also a Vice President of RCC
and has been with RCC since June 1989. Prior to joining RCC, Mr. Schlacter
garnered 16 years of direct real estate experience, covering retail and
residential construction, single and multifamily mortgage origination and
servicing, commercial mortgage origination and servicing, property acquisition
and financing, and mortgage lending program underwriting and development. He was
a Vice President with Bankers Trust Company from 1986 to June 1989, and held
prior positions with Citibank, Anchor Savings Bank and the Pyramid Companies
covering the 1972-1986 period. Mr. Schlacter holds a Bachelor of Arts degree in
political science from Pennsylvania State University.
GARY PARKINSON, 55, is the Controller of our Company. Mr. Parkinson is also an
Assistant Vice President of RCC. Mr. Parkinson has been a Certified Public
Accountant in New York since 1987. Prior to joining RCC in September 2000, Mr.
Parkinson was employed by American Real Estate Partners, L.P. from July 1991 to
September 2000, Integrated Resources, Inc. from August 1988 to July 1991 and
Ernst and Young from September 1984 to August 1988. Mr. Parkinson graduated from
Northeastern University and The Johnson Graduate School of Business at Cornell
University.
13
TERESA WICELINSKI, 38, is the Secretary of our Company. Ms. Wicelinski joined
RCC in June 1992, and prior to that date was employed by Friedman, Alpren &
Green, certified public accountants. Ms. Wicelinski graduated from Pace
University with a Bachelor of Arts Degree in accounting.
Committees of the Board of Trustees
Our board of trustees has standing audit, compensation and nominating
and governance committees. The audit committee's duties include the periodic
review of our financial statements and meetings with our independent auditors.
The audit committee must have three members and be comprised solely of
independent trustees. The audit committee held four meetings during our fiscal
year ended December 31, 2003 and is currently comprised of Messrs. Mannes, Perla
and Rosan, each of whom the board of trustees has determined is independent
within the meaning of SEC regulations and the listing standards of the American
Stock Exchange. In addition, our board of trustees has determined that Mr. Perla
is qualified as an audit committee financial expert within the meaning of SEC
regulations and the listing standards of the American Stock Exchange.
The compensation committee's duties include the determination of
compensation, if any, of our executive officers and of our Advisor and the
administration of our Incentive Share Option Plan. The compensation committee
must have at least two members and be comprised solely of independent trustees.
The compensation committee held one meeting during our fiscal year ended
December 31, 2003 and is currently comprised of Messrs. Mannes and Rosan, each
of whom the board of trustees has determined is independent within the meaning
of SEC regulations and the listing standards of the American Stock Exchange.
The nominating and governance committee's duties include recommending to
the Board, for its approval, the Trustee nominees for election at any annual or
special meeting of our shareholders and overseeing the our compliance with legal
and regulatory requirements pertaining to corporate governance, including the
corporate governance listing requirements of the American Stock Exchange. The
nominating and governance committee must have at least two members and be
comprised solely of independent trustees. The nominating and governance
committee was formed on March 10, 2004 and therefore did not hold any meetings
during our fiscal year ended December 31, 2003. The nominating and governance
committee is currently comprised of Messrs. Mannes and Perla, each of whom the
board of trustees has determined is independent within the meaning of SEC
regulations and the listing standards of the American Stock Exchange.
The following requirements are set forth in our Declaration of Trust to
help our nominating and governance committee identify trustee nominees:
o a majority of trustees must at all times be independent trustees;
o a trustee must be an individual at least 21 years of age who is not
under legal disability;
o a trustee must have at least three years of relevant experience
demonstrating the knowledge and experience required to successfully
acquire and manage mortgage investments; and
o at least one independent trustee must have at least three years of
relevant real estate experience.
Any shareholder entitled to vote at the annual meeting may submit a
nomination for a trustee. However, any shareholder entitled to vote at the
annual meeting generally may nominate one or more persons for election as
trustees at a meeting only if written notice of such shareholder's intent to
make such nomination or nominations has been given, either by personal delivery
or by United States mail, postage prepaid, to our Secretary not later than (i)
with respect to an election to be held at an annual meeting of shareholders,
ninety days prior to the anniversary date of the immediately preceding annual
meeting, and (ii) with respect to an election to be held at a special meeting of
shareholders for the election of trustees, the close of business on the tenth
day following the date on which notice of such meeting is first given to
shareholders. Each such notice shall set forth: (a) the name and address of the
shareholder who intends to make the nomination and of the person or persons to
be nominated; (b) a representation that the shareholder
14
is a holder of record of our shares entitled to vote at such meeting and intends
to appear in person or by proxy at the meeting to nominate the person or persons
specified in the notice; (c) a description of all arrangements or understandings
between the shareholder and each nominee and any other person or persons (naming
such person or persons) pursuant to which the nomination or nominations are to
be made by the shareholder; (d) such other information regarding each nominee
proposed by such shareholder as would be required to be included in a proxy
statement filed pursuant to the proxy rules of the Securities and Exchange
Commission, had the nominee been nominated, or intended to be nominated by the
Board of Trustees; and (e) the consent of each nominee to serve as a Trustee of
the Trust, if so elected. The presiding officer of the meeting may refuse to
acknowledge the nomination of any person not made in compliance with the
foregoing procedure.
The nominating and governance committee is responsible for recommending
to the Board for approval a set of corporate governance guidelines and a code of
business conduct. The nominating and governance committee is in the process of
reviewing these documents and we expect to include the final versions in the
definitive proxy statement.
Communication with Trustees
You may communicate directly with the board of trustees of our Company
by sending correspondence to our Company's Secretary at: Secretary, American
Mortgage Acceptance Company, 625 Madison Avenue, New York, New York 10022. The
sender should indicate in the address whether it is intended for the entire
board, the independent trustees as a group, or to an individual trustee. Each
communication intended for the board or independent trustees received by the
Secretary will be promptly forwarded to the intended recipients in accordance
with the sender's instructions.
Our Advisor
The officers of our Advisor provide services to our Company. All of the
voting shares of our Advisor are indirectly owned by CharterMac.
The directors and officers of our Advisor are set forth below.
Related AMI Associates, Inc.
Year First Became
Name Age Offices Held Officer/Director
---- --- ------------ ----------------
Stuart J. Boesky 47 Director and President 1991
Alan P. Hirmes 49 Senior Vice President 1991
Michael J. Brenner 58 Director 1999
Gary Parkinson 55 Treasurer 2000
Teresa Wicelinski 38 Secretary 1998
Biographical information with respect to Mr. Parkinson and Ms. Wicelinski is set
forth under "Other Officers of Our Company" above and with respect to Messrs.
Hirmes and Boesky is set forth under "PROPOSALS BEFORE THE MEETING -- Proposal
#1: Election of Trustees" above.
MICHAEL J. BRENNER is a Director of our Advisor, and is the Executive Vice
President and Chief Financial Officer of The Related Companies, LP ("TRCLP").
TRCLP owns a 15.4% economic interest in CharterMac. Prior to joining TRCLP in
1996, Mr. Brenner was a partner with Coopers & Lybrand, having served as
managing partner of its Industry Programs and Client Satisfaction initiatives
from 1993-1996,
15
managing partner of the Detroit group of offices from 1986-1993 and Chairman of
its National Real Estate Industry Group from 1984-1986. Mr. Brenner graduated
summa cum laude from the University of Detroit with a Bachelors degree in
Business Administration and from the University of Michigan with a Masters of
Business Administration, with distinction.
Compliance with Section 16(a) of the Securities Exchange Act of 1934
Section 16(a) of the Securities Exchange Act of 1934, as amended,
requires our executive officers and trustees, and persons who own more than ten
percent of a registered class of our equity securities, to file reports of
ownership and changes in ownership with the Commission. These persons are
required by regulation of the Commission to furnish us with copies of all
Section 16(a) forms they file.
During the fiscal year ended December 31, 2003, one of our executive
officers, Stuart J. Boesky, did not comply with all applicable Section 16(a)
filing requirements. Mr. Boesky purchased shares of our Company through a
partnership in which he is a 25% equity holder on July 18, 2003 and he did not
file the applicable Section 16(a) filing until July 25, 2003, which is longer
than the two business day requirement of the Securities and Exchange Commission
for filing Section 16(a) filings. Other than Mr. Boesky, the remaining trustees,
executive officers and greater than ten percent beneficial owners complied with
all applicable Section 16(a) filing requirements.
EXECUTIVE COMPENSATION
Trustees and Management
We currently have five executive officers2 and five trustees (three of
whom are independent trustees). We do not pay or accrue any fees, salaries or
other forms of compensation to our officers other than options which may be
received under the Share Option Plan. Independent trustees receive compensation
for serving as independent trustees at the rate of $10,000 per year payable in
cash, in addition to an expense reimbursement for attending meetings of our
board of trustees. Independent trustee compensation is the subject of Proposal
#2 which is to be voted on at the annual meeting. See "PROPOSALS BEFORE THE
MEETING - Proposal #2: Amendment of Declaration of Trust to Remove Limitation on
Independent Trustee Compensation".
Our Advisor, at its expense, provides all personnel necessary to conduct
our regular business. Our Advisor receives various fees and reimbursements for
advisory and other services performed under our Advisory Agreement, as further
described in the "CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS - Advisory
Agreement" section of this Proxy Statement. An affiliate of our Advisor pays all
salaries, bonuses and other compensation (other than options which may be
received under the Share Option Plan) to the officers of our Advisor (including
such officers who also serve as officers of our Company). Certain officers of
our Advisor and certain officers of our Company receive compensation from our
Advisor and its affiliates for services performed for various affiliated
entities, which may include services performed for us. Such compensation may be
based in part on our performance; however, our Advisor believes that any such
compensation attributable to services performed for us is immaterial.
Share Option Plan
We have adopted an Incentive Share Option Plan (the "Plan"), the purpose
of which is (i) to attract and retain qualified persons as trustees and officers
and (ii) to incentivize and more closely align the financial interests of our
Advisor and its employees and officers with the interests of the holders of our
common shares by providing our Advisor with a substantial financial interest in
our success. The compensation committee, which is comprised of Messrs. Mannes
and Rosan, administers the Plan. Pursuant to the Plan, if our distributions per
common share in the immediately preceding calendar year
--------
2 Upon the resignation of Stuart A. Rothstein on March 31, 2004, we will only
have four executive officers.
16
exceed $1.45 per common share, the compensation committee has the authority to
issue options to purchase, in the aggregate, that number of common shares which
is equal to three percent of the common shares outstanding as of December 31 of
the immediately preceding calendar year, provided that the compensation
committee may only issue, in the aggregate, options to purchase a maximum number
of common shares over the life of the Plan equal to 383,863 common shares (
i.e., 10% of the common shares outstanding on December 31, 1999, the end of the
year in which our common shares commenced trading on the American Stock
Exchange). The increase in the amount of options available under the Plan and
the removal of the three percent limitation are the subject of Proposal #3 which
is to be voted on at the annual meeting. See "PROPOSALS BEFORE THE MEETING -
Proposal #3: Amendment of Incentive Share Option Plan".
Subject to the limitations described in the preceding paragraph, if the
compensation committee does not grant the maximum number of options in any year,
then the excess of the number of authorized options over the number of options
granted in such year will be added to the number of authorized options in the
next succeeding year and will be available for grant by the compensation
committee in such succeeding year.
All options granted by the compensation committee will have an exercise
price equal to or greater than the fair market value of the common shares on the
date of the grant. The maximum option term is ten years from the date of grant.
All common share options granted pursuant to the Plan may vest immediately upon
issuance or in accordance with the determination of the compensation committee.
No options were granted for the years ended December 31, 1999, December 31,
2000, and December 31, 2001. In 2002, we distributed $1.51 per common share.
Therefore, the compensation committee was authorized to issue options for the
year ended December 31, 2002. On April 11, 2003, the compensation committee
granted 190,000 options to 25 employees of RCC and to our Advisor. In 2003, we
distributed $1.60 per common share. Therefore, the compensation committee is
authorized to issue options for the year ended December 31, 2003. To date, there
have not been any options issued.
Report of the Compensation Committee
The compensation committee of our board of trustees is comprised of two
independent trustees (Messrs. Rosan and Mannes). The role of the compensation
committee is to administer the policies governing the Plan. Because we do not
pay salaries and bonuses to our officers or our Advisor, the compensation
committee does not determine executives' salary levels. Subject to the
restrictions contained in the Plan, option compensation is intended to be set at
a level competitive with the amounts paid to the management of similarly sized
companies in similar industries. The compensation committee also evaluates the
performance of management when determining the number of options to be issued.
Our grants of share options are structured to link the compensation of
our officers and the officers and employees of our Advisor with our performance.
Through the establishment of the Plan, we have aligned the financial interests
of our executives (and the executives and employees of our Advisor) with the
results of our performance, which is intended to enhance shareholder value. The
compensation committee may only grant options if certain performance levels are
met and is limited in the number of options which may be granted each year (See
"Share Option Plan" above). The amount of options which may be granted will be
set at levels that the compensation committee believes to be consistent with
others in our industry, with such compensation contingent upon our level of
annual and long-term performance.
Section 162(m) was added to the Internal Revenue Code as part of the
Omnibus Budget Reconciliation Act of 1993. Section 162(m) limits the deduction
for compensation paid to the Chief Executive Officer and the other executive
officers to the extent that compensation of a particular executive exceeds
$1,000,000 (less the amount of any "excess parachute payments" as defined in
Section 280G of the Code) in any one year. However, under Section 162(m), the
deduction limit does not apply to certain "performance-based" compensation
established by an independent compensation committee which conforms to certain
restrictive conditions stated under the Code and related regulations. It is our
goal to have compensation paid to our executive officers qualify as
performance-based compensation deductible for
17
federal income tax purposes under Section 162(m). Given the fact that we are
currently externally managed and the only compensation that currently may be
paid to our executive officers are options pursuant to the Plan, it is unlikely
that Section 162(m) will present any concerns.
COMPENSATION COMMITTEE
Scott Mannes
Richard Rosan
Stock Performance Graph
The following stock performance graph compares our performance to the
S&P 500 and the NAREIT Mortgage REIT Index. The graph assumes a $100 investment
on July 1, 1999 (which is the month in which our common shares commenced trading
on the American Stock Exchange). All stock price performance figures include the
reinvestment of dividends.
18
[CHART OMITTED]
[CHART OMITTED]
Cumulative Total Return
7/1/99 12/99 12/00 12/01 12/02 12/03
------ ----- ----- ----- ----- -----
AMAC $ 100.00 $ 74.05 $ 78.78 $161.93 $175.36 $223.61
S & P 500 100.00 107.71 97.90 86.26 67.20 86.48
NAREIT MORTGAGE 100.00 58.84 68.23 121.00 158.60 249.61
19
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
As of April 16, 2004, no one was known by us to be the beneficial owner
of more than five percent of the outstanding common shares of our Company. 3
As of April 16, 2004, trustees and executive officers of our Company and
directors and executive officers of our Advisor own, directly or beneficially,
common shares as follows 4:
Amount and Nature of
Name Title Beneficial Ownership Percent of Class
---- ----- -------------------- ----------------
Stuart J. Boesky Chairman, President and 119,971 Common Shares(1)(2) 1.44%
CEO of our Company and Director
and President of our Advisor
Alan P. Hirmes Trustee and Interim COO 106,471 Common Shares(1) 1.28%
of our Company, SVP of Advisor
Stanley Perla Trustee of our Company 0 Common Shares --
Richard Rosan Trustee of our Company 0 Common Shares --
Scott M. Mannes Trustee of our Company 0 Common Shares --
Stuart A. Rothstein Executive Vice President 17,333 Common Shares(3) *(4)
Denise L. Kiley Senior VP of our Company 94,471 Common Shares(1) 1.13%
Marc D. Schnitzer Senior VP of our Company 94,471 Common Shares(1) 1.13%
Michael J. Brenner Director of our Advisor 2,500 Common Shares *
All Executive Officers and trustees and directors of
our Company and our Advisor as a group (8 persons) 156,643 Common Shares(1)(3) 1.69%
1 92,858 of these common shares are owned by RelCap Holdings, LLC, of which Messrs. Hirmes, Boesky Schnitzer and Ms. Kiley are
equity owners.
2 4,000 of these common shares are owned by the Eastside Investment Partners, of which Mr. Boesky is a 25% equity owner.
3 Includes 17,333 options to purchase Common Shares (which are exercisable within 60 days).
* Less than 1% of the common shares outstanding
--------
3 Share amounts are as of March 24, 2004 and will be updated/confirmed upon
filing of the definitive proxy with the Securities and Exchange Commission
4 Mr. Rothstein has announced he will resign as of March 31, 2004. The
definitive proxy will delete reference to his share ownership.
20
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
We have and will continue to have certain relationships with our Advisor
and its affiliates. However, there have been no direct financial transactions
between us and our trustees and officers or the directors and officers of our
Advisor.
Advisory Agreement
Our Company and our Advisor entered into an Advisory Agreement pursuant
to which our Advisor is obligated to use its best efforts to seek out and
present to us, whether through its own efforts or those of third parties
retained by it, suitable and a sufficient number of investment opportunities
which are consistent with our investment policies and objectives and consistent
with investment programs our board of trustees may adopt from time to time in
conformity with our Declaration of Trust.
Although our board of trustees has continuing exclusive authority over
our management, the conduct of its affairs, and the management and disposition
of our assets, our board of trustees has delegated to our Advisor, subject to
the supervision and review of our board of trustees and consistent with the
provisions of our Declaration of Trust, the power and duty to: (i) obtain,
furnish and/or supervise the services necessary to perform any ministerial
functions in connection with the management of our day-to-day operations; (ii)
seek out and present to us, whether through its own efforts or those of third
parties retained by it, suitable and a sufficient number of investment
opportunities which are consistent with our investment objectives and policies
as adopted by our trustees from time to time; (iii) exercise absolute
discretion, subject to our trustees' review, in decisions to originate, acquire,
retain, sell or negotiate for the prepayment or restructuring of mortgages and
our other investments; (iv) recommend investment opportunities consistent with
our investment objectives and policies and negotiate on our behalf with respect
to potential investments or the disposition thereof; (v) upon request, cause an
affiliate to serve as the mortgagee of record for our mortgages if such
affiliate is qualified to do so and in that capacity to hold escrows on behalf
of mortgagors in connection with the servicing of mortgages, which it may
deposit with various banks including banks with which it may be affiliated; (vi)
obtain for us such other services as may be required in acquiring or disposing
of investments, disbursing and collecting our funds, paying our debts and
fulfilling our obligations, and handling, prosecuting and settling any of our
claims, including foreclosing and otherwise enforcing mortgages and other liens
securing investments; (vii) obtain for us such services as may be required for
property management, mortgage brokerage and servicing, and other activities
relating to our investment portfolio; (viii) evaluate, structure and negotiate
potential prepayments or sales of mortgages and other investments and, if
applicable, coordinate with government agencies and Fannie Mae and Freddie Mac
in connection therewith; (ix) monitor annual participating interest payments,
monitor operations and expenses of the developments, and verify computations of
annual Participating Interest payments; (x) from time to time, or as requested
by our board of trustees, make reports to us as to its performance of the
foregoing services; and (xi) do all things necessary to assure its ability to
render the services contemplated herein.
Our Advisory Agreement is renewable annually by us, subject to an
evaluation of the performance of our Advisor by our board of trustees. Our
Advisory Agreement may be terminated (i) without cause by our Advisor or (ii)
for Cause by a majority of the independent trustees, each without penalty, and
each upon 60 days' prior written notice to the non-terminating party.
Pursuant to the terms of our Advisory Agreement, our Advisor is entitled
to receive the fees and other compensation set forth below:
Fees/Compensation/Points* Amount
------------------------- ------
21
Asset Management Fee Equal to .625% on existing Original Mortgage
Investments; .355% on new Original Mortgage
Investments; .355% on investment grade Additional
Mortgage Investments; .750% on non-investment
grade Additional Mortgage Investments; and 1.000%
on unrated Additional Mortgage Investments.**
Annual Incentive Fee Subject to (1) a minimum annual distributions
being made to Shareholders from CAD of $1.45 per
Share and (2) our Company achieving at
least annual GAAP net income per share of $1.60
(net of the Annual Incentive Fee), our Advisor
shall be entitled to receive incentive
compensation for each fiscal year in an amount
equal to the product of: (A) 25% of the dollar
amount by which (1) (a) Funds From Operations of
our Company (before the Annual Incentive Fee) per
Share (based on the weighted average number of
common shares outstanding), plus (b) gains (or
minus losses) from debt restructuring and sales
of property per share (based on the weighted
average number of common shares outstanding),
exceed (2) an amount equal to the greater of: (a)
(i) the weighted average of (x) $20 (the price
per Share of the initial public offering) and (y)
the prices per Share of any secondary offerings
by our Company multiplied by (ii) the Ten-Year
U.S. Treasury Rate plus 2% per annum; and (b)
$1.45 multiplied by (B) the weighted average
number of common shares outstanding during such
year.
Origination Points Advisor receives, with respect to each mortgage
investment originated by us, a portion of the
origination points paid by borrowers equal to up
to 1% of the principal amount and we receive the
portion of the origination points paid by
borrowers in excess of 1% of the principal amount
of such mortgage investment.
Operating Expense Reimbursement For direct expenses incurred by our Advisor.
---------------
* Our Advisor is also permitted to earn miscellaneous compensation, which may
include, without limitation, construction fees, escrow interest, property
management fees, leasing commissions and insurance brokerage fees. The payment
of any such compensation is generally limited to the competitive rate for the
services being performed.
** "Original Mortgage Investments" means investments authorized under our
original investment policy, which include originated Mortgages, acquired
Mortgages and additional loans (and within such terms are also included REMICS,
CMOs, GNMA, FHA and FHLMC Pass-Through Certificates). "Additional Mortgage
Investments" shall mean uninsured mortgage loans, construction loans, bridge
loans, mezzanine loans, mortgage derivatives, and commercial mortgage backed
securities ("CMBS") subordinated interests (including subordinated interests in
CMBS).
22
Incentive Share Options Our Advisor may receive options to acquire
additional common shares pursuant to our
Incentive Share Option Plan only if our
distributions in any year exceed $1.45 per common
share and the compensation committee of our board
of trustees determines to grant such options.
Our Advisor may engage in other business activities related to real
estate, mortgage investments or other investments whether similar or dissimilar
to ours, or act as Advisor to any other person or entity having investment
policies whether similar or dissimilar to ours. Before our Advisor, the officers
and directors of our Advisor and all persons controlled by our Advisor and its
officers and directors may take advantage of an opportunity for their own
account or present or recommend it to others, they are obligated to present such
investment opportunity to us if (i) such opportunity is of a character which
could be taken by us, (ii) such opportunity is compatible with our investment
objectives and policies and (iii) we have the financial resources to take
advantage of such opportunity.
The Declaration of Trust and Advisory Agreement provide that we will
indemnify our Advisor and its affiliates under certain circumstances.
Our Advisor is entitled to subcontract its obligations under our
Advisory Agreement to an affiliate. In accordance with the foregoing, our
Advisor has assigned its rights and obligations to RCC.
Pursuant to our Advisory Agreement, our Advisor is entitled to receive
as compensation a number of shares equal to 1% of all common shares issued by
us. In connection with a 1,955,000 common share offering we completed in April,
2003, our Advisor was issued 19,550 common shares. These shares were
subsequently distributed to RelCap Holdings, LLC.
Affiliated Transactions
In September 2003, we and our Advisor agreed to amend the Advisory
Agreement regarding the payment of an incentive management fee to the Advisor.
Under the terms of the amended agreement, there is no change to the calculation
of the incentive management fee. However, the incentive management fee is only
earned by the Advisor if the Company attains $1.60 in GAAP earnings per share
for the calendar year. Based on the amendment to the agreement and the our 2003
earnings per share of $1.52, the we did not pay the Advisor an incentive
management fee in 2003.
Also in September 2003, we entered into a letter of agreement with PW
Funding Inc. ("PWF"), a subsidiary of CharterMac, which is the parent of our
Advisor , under which we transferred and assigned all of our rights and
obligations to the two loans we originated under our Fannie Mae Virtual DUS
program to PWF. There was no payment made or received by us in connection with
this transfer. CharterMac has agreed to guarantee PWF's performance with regard
to this program, which in turn, allowed for the release of approximately $8.3
million in collateral pledged by us to secure our obligations under the loan
program. In turn, we indemnified PWF against any losses to Fannie Mae on the
loans and indemnified CharterMac against any obligation under its guaranty. The
maximum aggregate exposure to us under this agreement is approximately $7.5
million. However, we believe that we will not be called upon to fund any of
these guarantees and, accordingly, that the fair value of the guarantees is
insignificant.
In October 2003, we purchased nine taxable revenue bonds at a discount
(99% of par) from CharterMac in the amount of $7.6 million. The nine taxable
revenue bonds, each of which is secured by a first mortgage position, held by
CharterMac, on a multifamily property, carry a weighted average interest rate of
8.69%. The price paid was determined by an independent third party valuation of
the taxable revenue bonds. This transaction was approved by the independent
members of our Board of Trustees.
23
On October 15, 2003, we funded a bridge loan to Related Capital
Guaranteed Corporate Partners II, L.P. Series A, an affiliate of our Advisor, in
the approximate amount of $1.3 million. We received a fee of $10,000 for funding
the loan. The loan was repaid on October 31, 2003.
During 2003, the Advisor agreed to waive approximately $67,000 in asset
management fees relating to additional work the Advisor performed on certain
properties owned by us which were acquired as the result of us foreclosing on
troubled loans. As the Advisor was paid a fee at the time the loans were
originated, the Advisor agreed to waive certain additional fees to which it was
entitled.
In December 2003, we borrowed approximately $11.3 million from
CharterMac in order to aid in the purchase of the Concord at Gulfgate first
mortgage in the total amount of $14.1 million. CharterMac charged us interest at
an annual rate of 3.17% on the borrowings, which was based on LIBOR plus 2%,
which is the same rate paid by us on our Fleet Warehouse Facility. Shortly
thereafter, we received a loan from Fleet on the warehouse facility in the
amount of $14 million, the proceeds of which were used to repay the loan to
CharterMac.
ACCOUNTING AND AUDIT INFORMATION
Audit Committee Charter
On August 4, 2003, our board of trustees adopted the following Audit
Committee Charter. The Audit Committee Charter will be reviewed by the audit
committee each year:
I. PURPOSE
The Audit Committee is established by and amongst the board of trustees for the
primary purpose of assisting the board in:
o overseeing the integrity of the Company's financial statements,
o overseeing the Company's compliance with legal and regulatory
requirements,
o overseeing the independent auditor's qualifications and independence,
o overseeing the performance of the Company's independent auditor, and
o overseeing the Company's system of disclosure controls and system of
internal controls regarding finance, accounting, legal compliance, and
ethics that management and the Board have established.
Consistent with this function, the Audit Committee should encourage continuous
improvement of, and should foster adherence to, the Company's policies,
procedures and practices at all levels. The Audit Committee should also provide
an open avenue of communication among the independent auditors, financial and
senior management, and our board of trustees.
The Audit 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 Audit
Committee, for compensation to the independent auditor and to any advisers that
the Audit Committee chooses to engage.
The Audit Committee will primarily fulfill its responsibilities by carrying out
the activities enumerated in Section III of this Charter. The Audit Committee
will report regularly to our board of trustees regarding the execution of its
duties and responsibilities.
II. COMPOSITION AND MEETINGS
24
The Audit Committee shall be comprised of three or more trustees as determined
by the board, each of whom shall be independent trustees (as defined by all
applicable rules and regulations), and free from any relationship (including
disallowed compensatory arrangements) that, in the opinion of the board, would
interfere with the exercise of his or her independent judgment as a member of
the audit committee. Each trustee shall be free of any relationship that, in the
opinion of the board, would interfere with his or her individual exercise of
independent judgment, and shall meet the director independence requirements for
serving on the audit committee as set forth in the corporate governance
standards of the American Stock Exchange. All members of the Audit Committee
shall have a working familiarity with basic finance and accounting practices.
The board shall determine whether at least one member of the Audit Committee
qualifies as an "audit committee financial expert" in compliance with the
criteria established by the SEC and other relevant regulations. At such time
that the presence of an "audit committee financial expert" is required by the
Sarbanes-Oxley Act of 2002, the Company will disclose, in periodic filings as
required by the SEC, (i) the name of the "audit committee financial expert" and
whether or not he or she is independent, or (ii) the reason for the absence of a
current "audit committee financial expert". Audit Committee members may enhance
their familiarity with finance and accounting by participating in educational
programs conducted by the Company or an outside consultant. The board has
determined that simultaneous service on more than one audit committee would not
impair the ability of any trustee to effectively serve on the Company's Audit
Committee.
The members of the Audit Committee shall be elected by the board at the annual
organizational meeting of the board or until their successors shall be duly
elected and qualified. Unless a Chair is elected by the full board, the members
of the Audit Committee may designate a Chair by majority vote of the full Audit
Committee membership.
The Audit Committee shall meet at least four times annually, or more frequently
as circumstances dictate. Each regularly scheduled meeting shall conclude with
an executive session of the Audit Committee absent members of management and on
such terms and conditions as the Audit Committee may elect. As part of its job
to foster open communication, the Audit Committee should meet periodically with
management and the independent auditors in separate executive sessions to
discuss any matters that the Audit Committee or each of these groups believe
should be discussed privately. In addition, the Audit Committee should meet
quarterly with the independent auditors and management to discuss the annual
audited financial statements and quarterly financial statements, including the
Company's disclosure under "Management's Discussion and Analysis of Financial
Condition and Results of Operations".
III. RESPONSIBILITIES AND DUTIES
To fulfill its responsibilities and duties the Audit Committee shall:
Documents/Reports/Accounting Information Review
1. Review this Charter periodically, at least annually, and recommend to the
board of trustees any necessary amendments as conditions dictate.
2. Review and discuss with management the Company's annual financial statements,
quarterly financial statements, and all internal controls reports (or summaries
thereof). Review other relevant reports or financial information submitted by
the Company to any governmental body, or the public, including management
certifications as required by the Sarbanes-Oxley Act of 2002 (Sections 302 and
906) and relevant reports rendered by the independent auditors (or summaries
thereof).
3. Recommend to the board whether the financial statements should be included in
the Annual Report on Form 10-K. Review with financial management and the
independent auditors the 10-Q prior to its filing (or prior to the release of
earnings).
25
4. Review earnings press releases with management, including review of
"pro-forma" or "adjusted" non-GAAP information.
5. Discuss with management financial information and earnings guidance provided
to analysts and rating agencies. Such discussions may be on general terms (i.e.,
discussion of the types of information to be disclosed and the type of
presentation to be made).
Independent Auditors
6. Appoint (subject to shareholder ratification, if applicable), compensate, and
oversee the work performed by the independent auditor for the purpose of
preparing or issuing an audit report or related work. Review the performance of
the independent auditors and remove the independent auditors if circumstances
warrant. The independent auditors shall report directly to the audit committee
and the audit committee shall oversee the resolution of disagreements between
management and the independent auditors in the event that they arise. The audit
committee will review the experience and qualifications of senior members of the
independent audit team annually and ensure that all partner rotation
requirements, as promulgated by applicable rules and regulations, are executed.
The audit committee will also consider whether the auditor's performance of
permissible nonaudit services is compatible with the auditor's independence.
7. Review with the independent auditor any problems or difficulties and
management's response; review the independent auditor's attestation and report
on management's internal control report; and hold timely discussions with the
independent auditors regarding the following:
o all critical accounting policies and practices;
o all alternative treatments of financial information within generally
accepted accounting principles that have been discussed with management,
ramifications of the use of such alternative disclosures and treatments,
and the treatment preferred by the independent auditor;
o other material written communications between the independent auditor
and management including, but not limited to, the management letter and
schedule of unadjusted differences; and
o an analysis of the auditor's judgment as to the quality of the Company's
accounting principles, setting forth significant reporting issues and
judgments made in connection with the preparation of the financial
statements.
8. At least annually, obtain and review a report by the independent auditor
describing:
o the firm's internal quality control procedures;
o any material issues raised by the most recent internal quality-control
review, peer review, or by any inquiry or investigation by governmental
or professional authorities, within the preceding five years, respecting
one or more independent audits carried out by the firm, and any steps
taken to deal with any such issues; and
o (to assess the auditor's independence) all relationships between the
independent auditor and the Company.
9. Review and preapprove both audit and nonaudit services to be provided by the
independent auditor (other than with respect to de minimis exceptions permitted
by the Sarbanes-Oxley Act of 2002). This duty may be delegated to one or more
designated members of the Audit Committee with any such preapproval reported to
the Audit Committee at its next regularly scheduled meeting. Approval of
nonaudit services shall be disclosed to investors in periodic reports required
by Section 13(a) of the Securities Exchange Act of 1934.
10. Set clear hiring policies, compliant with governing laws or regulations, for
employees or former employees of the independent auditor.
Financial Reporting Processes and Accounting Policies
26
11. In consultation with the independent auditors, review the integrity of the
organization's financial reporting processes (both internal and external), and
the internal control structure (including disclosure controls).
12. Review with management major issues regarding accounting principles and
financial statement presentations, including any significant changes in the
Company's selection or application of accounting principles, and major issues as
to the adequacy of the Company's internal controls and any special audit steps
adopted in light of material control deficiencies.
13. Review analyses prepared by management (and the independent auditor as noted
in item 7 above) setting forth significant financial reporting issues and
judgments made in connection with the preparation of the financial statements,
including analyses of the effects of alternative GAAP methods on the financial
statements.
14. Review with management the effect of regulatory and accounting initiatives,
as well as off-balance sheet structures, on the financial statements of the
Company.
15. Establish and maintain procedures for the receipt, retention, and treatment
of complaints regarding accounting, internal accounting, or auditing matters.
16. Establish and maintain procedures for the confidential, anonymous submission
by Company employees regarding questionable accounting or auditing matters.
Legal Compliance and Risk Management
17. Review, with the organization's counsel, any legal matter that could have a
significant impact on the organization's financial statements.
18. Discuss policies with respect to risk assessment and risk management. Such
discussions should include the Company's major financial and accounting risk
exposures and the steps management has undertaken to control them.
Other Responsibilities
19. Review with the independent auditors and management the extent to which
changes or improvements in financial or accounting practices, as approved by the
Audit Committee, have been implemented. (This review should be conducted at an
appropriate time subsequent to implementation of changes or improvements, as
decided by the Audit Committee.)
20. Prepare the report that the SEC requires be included in the Company's annual
proxy statement.
21. Annually, perform a self-assessment relative to the audit committee's
purpose, duties and responsibilities outlined herein.
22. Perform any other activities consistent with this Charter, the Company's
by-laws and governing law, as the Audit Committee or the board deems necessary
or appropriate.
Audit Committee Report
The audit committee of our board of trustees has issued the following
report with respect to our audited financial statements for the fiscal year
ended December 31, 2003:
27
o The audit committee has reviewed and discussed with our management our
fiscal 2003 audited financial statements;
o The audit committee has discussed with Deloitte & Touche LLP (our
independent auditors) the matters required to be discussed by Statements on
Auditing Standards No. 61 as amended by Statements on Auditing Standards
No. 90;
o The audit committee has received the written disclosures and letter from
the independent auditors required by Independence Standards Board Standard
No. 1 (which related to the auditors' independence from our Company and its
related entities) and has discussed with the auditors their independence
from us;
Based on the review and discussions referred to in the three items
above, the audit committee recommended to our board of trustees that the audited
financial statements be included in our Annual Report on Form 10-K for the
fiscal year ended December 31, 2003.
Submitted by the audit committee of our board of trustees:
Stanley Perla - Chairman
Richard Rosan
Scott M. Mannes
INDEPENDENT AUDITORS
Deloitte & Touche LLP have been and are presently our independent
auditors. Representatives of the Deloitte & Touche LLP are expected to be
present at the annual meeting and to be available to respond to appropriate
questions from holders of our common shares. In addition, such representatives
will have the opportunity to make a statement if they desire to do so.
The following table presents fees for professional audit services
rendered by Deloitte & Touche LLP, the member firms of Deloitte Touche Tohmatsu,
and their respective affiliates (collectively, "Deloitte & Touche") for the
audit of our financial statements for the fiscal years ended December 31, 2003
and December 31, 2002, and fees for other services rendered by Deloitte & Touche
during those periods.
--------------------------------------------------------------------------------
2003 2002
--------------------------------------------------------------------------------
Audit Fees (a) $196,500 $221,000
--------------------------------------------------------------------------------
Audit-Related Fees (b) - -
--------------------------------------------------------------------------------
Tax Fees (c) 42,000 35,500
--------------------------------------------------------------------------------
All Other Fees (d) - -
--------------------------------------------------------------------------------
Total $238,500 $256,500
--------------------------------------------------------------------------------
(a) Fees for audit services billed in 2003 and 2002 consisted of the audit
of the Company's annual financial statements, reviews of the Company's
quarterly financial statements, comfort letters, consents and other
services related to Securities and Exchange Commission matters.
(b) No audit-related services were rendered by Deloitte & Touche in 2003 or
2002.
..(c) Fees for tax services billed in 2003 and 2002 consisted of tax
compliance services. Tax compliance services are services rendered based
upon facts already in existence or transactions that have already
occurred to document, compute, and obtain government approval for
amounts to be included in tax filings and consisted of Federal, state
and local income tax return assistance and REIT compliance testing.
28
(d) No other services were rendered by Deloitte & Touche during 2003 or
2002.
All audit-related services, tax services and other services were
pre-approved by the audit committee, which concluded that the provision of those
services by Deloitte & Touche was compatible with the maintenance of Deloitte &
Touche's independence in the conduct of its auditing functions.
Policy on Pre-Approval of Independent Auditor Services
The audit committee is responsible for appointing, setting compensation
and overseeing the work of the independent auditors. The audit committee has
established a policy regarding pre-approval of all audit and non-audit services
provided by our Company's independent auditors.
On an on-going basis, management communicates specific projects and
categories of service for which the advance approval of the audit committee is
requested. The audit committee reviews these requests and advises management if
the audit committee approves the engagement of the independent auditors. The
audit committee may also delegate the ability to pre-approve audit and permitted
non-audit services to one or more of its members, provided that any
pre-approvals are reported to the audit committee at its next regularly
scheduled meeting.
EXPENSES OF SOLICITATION
We will bear the costs of soliciting proxies for the annual meeting.
Brokers and nominees should forward soliciting materials to the beneficial
owners of the common shares held of record by such person, and we will reimburse
them for their reasonable forwarding expenses. In addition to the use of the
mail, proxies may be solicited by our trustees and officers and the directors,
officers and employees of our Advisor by personal interview or telephone.
VOTING PROCEDURES
General
Equiserve, LP (the "Inspector") has been appointed the inspector of
elections. The Inspector will count all votes cast, in person or by submission
of a properly executed proxy, received at or prior to the annual meeting.
Abstentions and "broker non-votes" (nominees holding common shares for
beneficial owners who have not voted on a specific matter) will be treated as
present for purposes of determining whether a quorum is present at the annual
meeting. However, abstentions and broker non-votes will have no effect on the
vote for Proposal #1 because the vote required is a plurality of the votes
actually cast (assuming the presence of a quorum). Abstentions and broker
non-votes will be counted as votes against Proposal #2.
Voting
You may vote by completing, signing and mailing the enclosed proxy card
in the enclosed return envelope. In the alternative, you may also submit a proxy
by telephone or on the Internet by following the instructions on the enclosed
proxy card. To submit a proxy on the Internet, log on to the Internet and go to
http://www.eproxyvote.com/amc, enter your voter control number and follow the
directions outlined on the secure website. To submit a proxy by telephone, call
toll free 1-877-PRX-VOTE (1-877-779-8683), enter your voter control number and
follow the recorded instructions. Even if you plan to attend the annual meeting
in person, we urge you to return your proxy card to assure the representation of
your shares that the annual meeting.
Record Date
29
Only holders of our common shares of record at the close of business on
April 16, 2004 are entitled to receive notice of, and to vote at, the annual
meeting, or any postponements or adjournments thereof. As of that date, there
were approximately 8,338,180 common shares(5) issued and outstanding. Each
common share entitles the record holder thereof to one vote, exercisable in
person or by properly executed proxy, on all matters which properly come before
the annual meeting (or any postponement or adjournment thereof).
Quorum; Adjournments
For purposes of the annual meeting, the presence, in person or by proxy,
of shareholders entitled to cast a majority of all votes entitled to be cast at
the annual meeting will constitute a quorum. If a quorum is not obtained or, as
to any one or more of the proposals, if fewer common shares are voted in favor
of the proposal than the number of share required for approval, the annual
meeting may be adjourned for the purpose of obtaining additional proxies or
votes or for any other purpose and, at any subsequent reconvening of the annual
meeting, all proxies will be voted in the same manner as such proxies would have
been voted at the original convening of the annual meeting, except for any
proxies which have theretofore effectively been revoked or withdrawn,
notwithstanding that they may have been effectively voted on the same day for
any other matter at a previous meeting.
Vote Required
The affirmative vote of the holders of a majority of the outstanding
common shares entitled to vote at the annual meeting is required to approve an
amendment to our Declaration of Trust to remove the limitation on compensation
payable to our independent trustees. The affirmative vote of a majority of votes
cast is required to approve the amendments to our Incentive Share Option Plan.
The affirmative vote of a plurality of the votes actually cast by the holders of
our common shares at the annual meeting is required for the election of each of
the Trustee nominees. The affirmative vote of the holders of a majority of the
common shares voting either in person or by proxy at the annual meeting is
required to approve, if necessary, the extension of the solicitation period.
SHAREHOLDER PROPOSALS
Any shareholder proposal intended to be presented at the 2005 Annual
Meeting of Shareholders must be received by us at our principal executive office
not later than January 6, 2005, for inclusion in the proxy statement and form of
proxy relating to that meeting. Any such proposal must also comply with other
requirements of the proxy solicitation rules of the Securities and Exchange
Commission.
ANNUAL REPORT ON FORM 10-K
Upon written request by any shareholder entitled to vote at the meeting,
we will furnish that person without charge a copy of our Annual Report on form
10-K for the fiscal year ended December 31, 2003, which is filed with the
Securities and Exchange Commission, including the financial statements and
schedules thereto. Requests should be addressed to Brenda Abuaf at American
Mortgage Acceptance Company, 625 Madison Avenue, New York, New York 10022-1801.
OTHER BUSINESS
Our board of trustees does not know of any other matters to be brought
before the annual meeting except those set forth in the notice thereof. If other
business is properly presented for consideration at the annual meeting, it is
intended that the proxies will be voted by the persons named therein in
accordance with their judgment on such matters.
--------
5 Share amount is as of March 24, 2004 and will be updated/confirmed upon
filing of the definitive proxy with the Securities and Exchange Commission
30
It is important that your common shares be represented at the annual
meeting. If you are unable to be present in person, please complete, date, sign
and return the enclosed stamped, self-addressed proxy card, submit a proxy on
the Internet at http://www.eproxyvote.com/amc, or submit a proxy by telephone
by, calling toll free 1-877-PRX-VOTE (1-877-779-8683. Your failure to do so will
increase the costs of operating our Company and decrease the return on your
investment.
By Order of the Board of Trustees
/s/ Stuart J. Boesky
April 30, 2004 Stuart J. Boesky
Chairman, President and Chief Executive Officer
31
[AMAC Logo]
Dear Shareholder:
Please take note of the important information enclosed with this Proxy. There
are a number of issues related to the operation of AMAC that require your
immediate attention.
Your vote counts, and you are strongly encouraged to exercise your right to vote
your shares.
This year, for the first time, you can vote your Shares by Internet or phone.
Follow the instructions on the reverse side of proxy card if you wish to do so.
If you chose to vote by mail, please mark the boxes on the proxy card to
indicate how your shares will be voted. Then sign the card, detach it and return
your proxy in the enclosed postage paid envelope.
Thank you in advance for your prompt consideration of these matters.
Sincerely,
American Mortgage Acceptance Company
--------------------------------------------------------------------------------
Proxy
AMERICAN MORTGAGE ACCEPTANCE COMPANY
625 Madison Avenue
New York, New York 10022
SOLICITED BY THE BOARD OF TRUSTEES
FOR THE ANNUAL MEETING OF SHAREHOLDERS
The undersigned hereby appoints Stuart J. Boesky and Alan P. Hirmes, each with
the power to appoint his substitute, and hereby authorizes them to represent and
to vote, as designated on the reverse side, all common shares of American
Mortgage Acceptance Company ("AMAC") held of record by the undersigned on April
16, 2004 at the Annual Meeting of Shareholders to be held on June 9, 2004 and
any adjournments thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED, IF NO
DIRECTION IS GIVEN WITH RESPECT TO A PARTICULAR PROPOSAL, THIS PROXY WILL BE
VOTED FOR SUCH PROPOSAL.
PLEASE MARK, DATE, SIGN, AND RETURN THIS PROXY CARD PROMPTLY, USING THE
ENCLOSED ENVELOPE. NO POSTAGE IS REQUIRED IF MAILED IN THE UNITED STATES.
[SEE REVERSE SIDE] [SEE REVERSE SIDE]
CONTINUED AND TO BE SIGNED ON REVERSE SIDE
32
Vote By Telephone Vote By Internet
----------------- ----------------
Its fast, convenient and immediate! It's fast, convenient and your vote is immediately
Call Toll-Free on a Touch-Tone Phone confirmed and posted.
1-877-PRX-VOTE (1-888-779-8683)
-------------------------------------------------- -------------------------------------------------
Follow these four easy steps: Follow these four easy steps:
1. Read the accompanying Proxy Statement/ and 1. Read the accompanying Proxy Statement/ and
Proxy Card. Proxy Card.
2. Call the toll-free number 1-877-PRX-VOTE (1- 2. Go to the Website.
888-779-8683). http://www.eproxyvote.com/amc
3. Enter your 14-digit Voter Control Number 3. Enter your 14-digit Voter Control Number
located on your Proxy Card above your name. located on your Proxy Card above your name.
4. Follow the recorded Instructions. 4. Follow the Instructions provided.
-------------------------------------------------- -------------------------------------------------
Your vote is important! Your vote is important!
Call 1-877-PRX-VOTE anytime! Go to www.eproxyvote.com/amc anytime!
Do not return your Proxy Card if you are voting by Telephone or Internet
-------------------------------------------------------------------------------------------------------------------
DETACH HERE
[X] Please mark votes as in this example.
THE BOARD OF TRUSTEES RECOMMENDS A VOTE "FOR" EACH OF THE LISTED PROPOSALS
1. Election of Trustees. 3. Expansion of Incentive Share Plan.
Nominees: Stuart J. Boesky, Alan P. Hirmes Proposal to amend the Incentive Share Plan
Scott M. Mannes, Stanley Perla and to increase the overall number of options that
Richard M. Rosan are available and to remove the 3% annual
restriction on grants.
FOR ALL WITHOLD ALL FOR AGAINST ABSTAIN
[ ] [ ] [ ] [ ] [ ]
[ ]_________________________________ 4. In their discretion, the proxies are authorized
FOR ALL nominees EXCEPT as noted above to vote upon any other business that may properly
come before the meeting.
2. Trustee Compensation Amendment. MARK HERE FOR ADDRESS CHANGE AND
Proposal to amend the Declaration of Trust to NOTE AT LEFT [ ]
permit AMAC to remove the $10,000 Please sign exactly as name appears hereon. Joint
limitation on independent trustee compensation owners should each sign. Executors,
and give our board of trustees the discretion administrators, trustees and guardians or other
to set appropriate compensation levels fiduciaries should give full title as such. If
signing for a corporation, please sign in full
corporate name by a duly authorized officer.
FOR AGAINST ABSTAIN
[ ] [ ] [ ]
Signature:_________________________________________ Date:____ Signature:_________________________________________ Date:___________
33