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EX-31.1 - SECTION 302 CERTIFICATION - CENTERLINE HOLDING COexhibit31-1.htm
EX-32.1 - SECTION 906 CERTIFICATION - CENTERLINE HOLDING COexhibit32-1.htm
 


 
 

 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C.  20549
_____________
 
FORM 10-K/A
 
(Amendment No. 1)
 
_____________
 

þ
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
For the fiscal year ended December 31, 2011

OR

¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission File Number 1-13237
______________
 
CENTERLINE HOLDING COMPANY
 
(Exact name of Registrant as specified in its Trust Agreement)
 
______________
 
Delaware
 
13-3949418
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
     
100 Church Street, New York, New York
 
10007
(Address of principal executive offices)
 
(Zip Code)

(212) 317-5700
Registrant’s telephone number, including area code
 
Securities registered pursuant to Section 12(b) of the Act:
None

Securities registered pursuant to Section 12(g) of the Act:

Shares of Beneficial Interest

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  o   No  þ

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes  o   No  þ

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  Yes  þ   No  o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).  Yes  þ   No  o

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.  þ

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer
o
   
Accelerated filer
o
           
Non-accelerated filer
o
(Do not check if a smaller reporting company)
 
Smaller reporting company
þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).  Yes  o   No þ

The aggregate market value of common equity held by non-affiliates of the registrant as of June 30, 2011 was approximately $22.9 million (based on the closing price of $0.11 per share as reported on the Over-the-Counter Bulletin Board).

As of April 12, 2012, there were 349.2 million outstanding shares of the registrant’s shares of beneficial interest.

DOCUMENTS INCORPORATED BY REFERENCE

None
 
 


 
 
 
 
 
 
 
 
 
FORM 10-K/A
 
Index
 
   
Page
     
PART III
 
4
     
Item 10.Directors, Executive Officers and Corporate Governance.
 
4
     
Item 11.Executive Compensation.
 
8
     
Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
 
10
     
Item 13.Certain Relationships and Related Transactions, and Director Independence
 
14
     
Item 14.Principal Accounting Fees and Services.
 
17
     
PART IV
 
18
     
Item 15.Exhibits, Financial Statement Schedules.
 
18
     
SIGNATURES
   
     
EXHIBIT 31.1
   
     
EXHIBIT 32.1
   
 
 
 
 
 

 
 

 

 

EXPLANATORY NOTE
 
 
Centerline Holding Company (OTC: CLNH) is filing this Amendment No. 1 on Form 10-K/A (the “Amendment”) to amend its Annual Report on Form 10-K for the fiscal year ended December 31, 2011 (the “Form 10-K”), as filed with the Securities and Exchange Commission (“SEC”) on March 29, 2012.  This Amendment hereby amends Part III, Items 10 through 14.  We are also including as exhibits the certifications required under Section 302 of the Sarbanes-Oxley Act of 2002.
 
Except as otherwise expressly stated herein, this Amendment does not reflect events occurring after the date of the Form 10-K, nor does it modify or update the disclosure contained in the Form 10-K in any way other than as required to reflect the amendments discussed above and reflected below.  Accordingly, this Amendment should be read in conjunction with the Form 10-K and the Company’s other filings made with the SEC on or subsequent to March 29, 2012.
 
Unless the context requires otherwise, the terms “we”, “us”, “our” or “the Company” as used throughout this document may mean the business as a whole or a subsidiary, while the term “parent trust” refers only to Centerline Holding Company as a stand-alone entity.
 
 
 
 
 
 
 
 
 
 

 
 

 
PART III
 
 
Item 10.  
Directors, Executive Officers and Corporate Governance.
 
Trustees and Executive Officers
 
As of the date of this Amendment, our trustees and executive officers are as follows:
 
Name
Age
Offices Held
Independence
Year First Became Officer/Trustee
Term Expires
           
Jerome Y. Halperin
82
Managing Trustee
Independent
2003
2014
Robert L. Loverd
70
Managing Trustee, Chairman
Independent
2003
2012
Robert A. Meister
70
Managing Trustee
Independent
2003
2013
Thomas W. White
74
Managing Trustee
Independent
2000
2014
Robert L. Levy
46
President, Chief Operating Officer and Chief Financial Officer
Non Independent
2006
2012
Michael J. Curran
64
Senior Managing Director
Not applicable
2010
Not applicable
William T. Hyman
54
Senior Managing Director
Not applicable
2001
Not applicable
Michael Riechman
40
Senior Managing Director
Not applicable
2011
Not applicable
Philip A. Melton
44
Senior Managing Director
Not applicable
2011
Not applicable
Katherine B. Schnur
49
Senior Managing Director
Not applicable
2001
Not applicable
 
 

TRUSTEES:
 
Jerome Y. Halperin is a managing trustee (independent trustee) of our Company.  Mr. Halperin is a retired partner of PricewaterhouseCoopers, LLP (“PricewaterhouseCoopers”), the international accounting firm, where he spent 39 years in varied positions.  Mr. Halperin’s final position at PricewaterhouseCoopers was Chairman of the international actuarial, benefits and compensation services group.  After his retirement from PricewaterhouseCoopers, Mr. Halperin was the president of the Detroit Investment Fund, a private investment fund established to stimulate economic growth in the city of Detroit.  Currently, Mr. Halperin is a consultant on various real estate projects.  He serves on the board of directors of several charitable organizations and was the Chairman of the Michigan Tax Forms Revisions Committee, a position he was appointed to by the Governor of the State of Michigan.  Mr. Halperin is the co-author of “Tax Planning for Real Estate Transactions”.  Mr. Halperin received a Bachelor of Business Administration from the University of Michigan and a Juris Doctor from Harvard Law School.  Mr. Halperin is the chairman of our audit committee and is a member of our finance committee.
 
Robert L. Loverd is a managing trustee (independent trustee) and Chairman of our Company.  Mr. Loverd is the former Group Chief Financial Officer and a Founding Partner of MC European Capital (Holdings), a London investment banking and securities firm, which was established in 1995 and substantially sold in 2000.  From 1979-1994, Mr. Loverd held various positions in New York and London in the Investment Banking Department of Credit Suisse First Boston.  Prior to that, Mr. Loverd was a shareholder in the International Investment Banking Department of Kidder, Peabody & Co. Incorporated.  Mr. Loverd is a member of the Board of Directors of Harbus Investors.  Mr. Loverd received a Bachelor of Arts degree from Princeton University and a Master’s in Business Administration from Harvard Business School.  Mr. Loverd is the Chairman of the Board, the chairman of our compensation committee and a member of our nominating and governance committee and our audit committee.
 
Robert A. Meister is the Emeritus Vice Chairman of Aon Group, Inc. (“Aon”), an insurance brokerage, risk consulting, reinsurance and employee benefits company and a subsidiary of Aon Corporation, and has served in this position since 1991.  Prior to Aon, Mr. Meister was the Vice Chairman and a Director of Sedgwick James from 1985–1991 and the Vice Chairman of Alexander & Alexander from 1975–1985.  Mr. Meister is a member of the board of directors of Ramco-Gershenson Properties (NYSE: RPT) and Universal Health Services (NYSE: UHS) and serves on each company’s compensation committee.  Mr. Meister has served on the board of directors of several charitable organizations.  Mr. Meister received a Bachelor of Science degree in Business Administration from Pennsylvania State University.  Mr. Meister is the chairman of our nominating and governance committee and is a member of our compensation committee.
 
 
 
 
 
- 4 -

 
 
 
 
Thomas W. White is a managing trustee (independent trustee) of our Company.  Mr. White retired as a Senior Vice President of Fannie Mae in the multifamily activities department, where he was responsible for the development and implementation of policies and procedures for all Fannie Mae multifamily programs, including the delegated underwriting and servicing program, prior approval program and negotiated swap and negotiated cash purchases product lines.  He was also responsible for asset management of multifamily loans in a portfolio of mortgage-backed securities.  Prior to joining Fannie Mae in November 1987, Mr. White served as an investment banker with Bear Stearns, Inc.  He was also the executive vice president of the National Council of State Housing Agencies and chief underwriter for the Michigan State Housing Development Authority.  Mr. White also served as a state legislator in the state of Michigan.  Mr. White serves on the Board of Directors of Enterprise Community Investment, Inc.  Mr. White is the chairman of our finance committee and a member of our nominating and governance committee.
 
Robert L. Levy is a managing trustee and President, Chief Financial Officer and Chief Operating Officer of our Company.  Mr. Levy was appointed as Chief Financial Officer in November 2006 and was appointed our President and Chief Operating Officer in April 2010.  He directs the day-to-day operations of the Company and is also responsible for overseeing all of the Company’s business and operations. Mr. Levy joined the Company in November of 2001 as the Director of Capital Markets.  From 1998 through 2001, he was a Vice President in the Real Estate Equity Research and Investment Banking Departments at Robertson Stephens, an investment banking firm in San Francisco. Prior to 1998, Mr. Levy was employed by Prudential Securities in the Real Estate Equity Research Group and at the Prudential Realty Group, the real estate investment arm of the Prudential Insurance Company.  He received his Master’s in Business Administration from the Leonard N. Stern School of Business at New York University and his Bachelor of Arts from Northwestern University.

 
OTHER EXECUTIVE OFFICERS:
 
Michael J. Curran is a Senior Managing Director of Centerline Capital Group LLC (“CCG”), a subsidiary of Centerline Holding Company.  He leads the Asset Management Group, which comprises the Portfolio Management, Performing Assets, Special Servicing, Capital Transactions/REO and Construction Risk Management divisions.  Mr. Curran is also a member of the Centerline Executive Committee responsible for strategic planning and growth initiatives.  He joined CCG in 2010 after many years in real estate advisory positions, most recently at Kalorama Realty Capital.  He was principal and chief operating officer at Crossbeam Capital, and helped that firm raise a $145-million fund for the development and acquisition of multifamily housing properties.  Prior to Crossbeam Capital, he was president and chief executive officer of The Enterprise Social Investment Corporation (ESIC), a national for-profit subsidiary of the Enterprise Foundation, where he specialized in the financing and development of market-rate and affordable housing, and managed a housing portfolio of 900 properties valued at over $4 billion.  Mr. Curran spent over 14 years with MetLife Insurance Company earlier in his real estate finance career, where he led a team that originated new investments.  As Regional Director at MetLife, he and his team originated a new investment portfolio in excess of $1.8 billion.  Mr. Curran received the Bachelor of Arts from Bellarmine University, the Juris Doctor from the University of Louisville School of Law, and the Master of Public Administration from Harvard University John F. Kennedy School of Government.
 
William T. Hyman is a Senior Managing Director of CCG, and leads its Mortgage Banking Group.  Mr. Hyman is responsible for overseeing CCG financing activities sponsored by Government Sponsored Enterprises (GSE) for conventional multifamily properties.  He has been with CCG or its predecessor companies since 1988, following the acquisition of PW Funding (an independent mortgage banking subsidiary of CCG), where he was co-president, by CCG.  At PW Funding, Mr. Hyman served as executive vice president and managed loan production operations for its mortgage banking platform as chief underwriter and head of the credit department for Fannie Mae DUS lending activity.  Prior to his tenure with PW Funding and CCG, he served as a vice president with L.F. Rothschild and Co., marketing and executing private placements and initial public offerings.  Before that he was in the public finance investment banking division of PaineWebber Inc. Mr. Hyman earned the Master of Business Administration from Washington University in St. Louis and the Bachelor of Arts from Yale University.
 
Philip A. Melton is a Senior Managing Director in the Affordable Housing Debt division of the Affordable Housing Group of CCG.  Mr. Melton joined CCG in May 2011 lead and expand the production efforts within the affordable housing lending platform.  The CCG lending platform includes Fannie Mae, Freddie Mac, and FHA executions as well as affiliated executions for conduit and bridge lending for multifamily housing financing.  Mr. Melton has more than 15 years of real estate lending experience which includes commercial and multifamily assets involving construction, bridge, permanent loan, and tax-exempt bond financing.  Prior to joining CCG, Mr. Melton led the Affordable Housing and FHA teams with Grandbridge Real Estate Capital, L.L.C, leading the Affordable Housing platform for over eight years and leading the FHA platform for the past 18 months.  Prior to Grandbridge, Mr. Melton worked for a number of national lenders in the Affordable Housing market as well as working as an investment banker for a regional financial institution in the Southeast.  Mr. Melton has been involved with over $1.5B in real estate financings in his career including taxable and tax-exempt financings.  Mr. Melton graduated with a Bachelor of Science in Economics from the University of New Orleans.
 
 
 
 
 
 
- 5 -

 
 
 
 
Michael Riechman is a Senior Managing Director and head of the Affordable Housing Equity division at CCG.  Based in Charlotte, North Carolina, he serves on the firm’s Executive Management team and has national responsibility for growing CCG’s affordable equity business.  Mr. Riechman leads a team of 25 specialists throughout the United States who focus on acquisitions, dispositions, underwriting, and fund originations.  CCG’s platform is recognized as an industry leader in the Affordable Housing arena.  Mr. Riechman joined CCG from RBC Capital Markets in Charlotte, North Carolina where he spent eight years, most recently as Managing Director responsible for tax credit investments.  At RBC Capital he was a member of the executive management team and served on the investment committee.  There he led the tax credit investment group that included: originations and syndications, investments, pricing and structuring.  Prior to RBC Capital, Mr. Riechman was at Fannie Mae in Washington, DC where he held several key positions in the American Communities Fund.  Before Fannie Mae, Mr. Riechman was with the Reznick Group of Bethesda, Maryland and the Miller Valentine Group in Dayton, Ohio.  Mr. Riechman earned a BBA in accounting from University of Cincinnati and an MBA from American University.
 
Katherine B. Schnur is a Senior Managing Director of CCG, and heads the Operations and Human Resources departments in the Corporate Group.  Ms. Schnur has been with CCG since 1988, joining one of its predecessor companies in the loan servicing department.  At CCG, Ms. Schnur has held the title of Senior Vice President in the Loan Administration, Closing, and Underwriting departments, in addition to serving as Chief Operating Officer and Managing Director of the mortgage banking division.  Ms. Schnur has been an active member of the Mortgage Bankers Association of America, and was a select member of its inaugural class of “Future Leaders” in 1997.   She also holds the SPHR accreditation in human resources.  Ms. Schnur earned the Bachelor of Arts in Psychology and Economics from Lafayette College in Pennsylvania.
 
Centerline Holding Company Advisors
 
I.   Island Centerline Manager LLC (the “Advisor”)
 
We have an advisory agreement with Island.  The agreement provides for an initial five year term and, subject to a fairness review of advisory fees, for successive one year renewal terms.  Pursuant to the agreement:
 
·  
Island will provide strategic and general advisory services to us; and
 
·  
we paid $5.0 million of advisory fees over a 12 month period from the date of the agreement for certain fund management review services and have paid and will pay a $5.0 million annual base advisory fee and an annual incentive fee if certain EBITDA thresholds are met (as defined in the agreement).
 
The agreement provides each party with various rights of termination, which in our case under certain circumstances would require the payment of a termination fee in an amount equal to three times the base and incentive fee earned during the previous year.
 
II.    CCG
 
The Company and its subsidiaries operate their day-to-day activities utilizing the services and advice provided by the Company’s subsidiary, CCG, subject to the supervision and review of the Company’s Board and the Company’s subsidiaries’ board of trustees, or directors, as applicable.  Although the Company’s Board and each board of trustees, or directors, of the Company’s subsidiaries have continuing exclusive authority over the respective entity’s management, affairs and disposition of assets, the Company’s Board, and the board of trustees or directors of the Company’s subsidiaries, as applicable, have delegated to CCG the power and duty to perform all of the asset management and investment services required to run our day-to-day operations.  Post-the March 2010 Restructuring, CCG will also benefit from assistance from the Island Advisor under the Island Advisory Agreement.
 
 
 
 
 
- 6 -

 
 
 
Under the Amended and Restated Management Agreement, CCG is entitled to receive reimbursement of all costs incurred by CCG in performing services for the Company plus an amount equal to a market-based percentage, as jointly determined from time to time by the Company and CCG.  The Amended and Restated Management Agreement may be renewed, subject to evaluation and approval by the relevant entity’s board of trustees or directors, as applicable.  The Amended and Restated Management Agreement may be terminated:
 
(i)           with or without cause by CCG at any time, or
 
(ii)           for cause the applicable entities’ board, in each case without penalty and each upon 60 days’ prior written notice to the non-terminating party.
 
Under the Amended and Restated Management Agreement entered into in July 2010, CCG will operate solely the day-to-day activities of the Company and will work with and support the Island Advisor, subject to the supervision and review of the Board and the Company’s subsidiaries’ board of trustees, or directors, as applicable.
 
Executive Officers of CCG
 
As of the date of this Amendment, the sole executive officers of CCG were:
 
Name
Age
Office
     
Robert L. Levy
46
    President, Chief Financial Officer, and Chief Operating Officer
     
Michael J. Curran
64
    Senior Managing Director, Head of Asset Management Group
     
William T. Hyman
54
    Senior Managing Director, Head of Mortgage Banking Group
     
Philip A. Melton
40
    Senior Managing Director, Head of Affordable Housing Debt
     
Michael Riechman
44
    Senior Managing Director, Head of Affordable Housing Equity
     
Katherine B. Schnur
49
    Senior Managing Director, Head of Operations
 
Biographical information with respect to Mr. Levy, Mr. Curran, Mr. Hyman, Mr. Melton, Mr. Riechman, and Ms. Schnur may be found under “Item 10.  Directors, Executive Officers and Corporate Governance”.
 
Section 16(a) Beneficial Ownership Reporting Compliance
 
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 SEC.  These persons are required by regulation of the SEC to furnish us with copies of all Section 16(a) forms they file.
 
During the fiscal year ended December 31, 2011, our trustees, executive officers and greater than ten percent beneficial owners complied with all applicable Section 16(a) filing requirements.
 
Code of Conduct and Code of Ethics
 
We have adopted a Code of Business Conduct and Ethics as defined under the rules of the SEC that applies to our trustees and  employees.
 
We regularly monitor developments in the area of corporate governance and continue to enhance our corporate governance structure based upon a review of new developments and recommended best practices.  Our corporate governance materials, including our Categorical Standards, Corporate Governance Guidelines, Code of Business Conduct and Ethics, Whistle Blower Policy (which is incorporated in our Code of Business Conduct and Ethics) and charters for the audit, compensation, and nominating and governance committees may be found on our website at http://www.centerline.com in the “Investor Relations” section (under “Corporate Governance”).  Please note that the information on our website is not incorporated by reference in this proxy statement.  Copies of these materials are also available to shareholders upon written request to our President, Centerline Holding Company, 100 Church Street, New York, New York 10007.
 
 
 
 
- 7 -

 
 
 
 
Nominations for trustees
 
There have been no material changes to the procedures by which security holders may recommend nominees to our Board since those procedures were described in the Proxy Statement for our 2011 annual meeting of the shareholders.
 
Audit Committee
 
We have a separately designated standing audit committee established in accordance with Section 3(a)(58)(A) of the Exchange Act.  The audit committee’s duties include the periodic review of our financial statements and meetings with our independent registered public accounting firm.  The ongoing administration of the Corporate Governance Guidelines and the Code of Business Conduct and Ethics for our Company is overseen by the audit committee.  The audit committee must have at least three members and be comprised solely of independent trustees.  The audit committee is currently comprised of Mr. Halperin (chair), Mr. White and Mr. Loverd.  Our Board has determined that all three committee members are independent within the meaning of the SEC rules and regulations.  In addition, our Board has determined that Mr. Halperin is qualified as an audit committee financial expert within the meaning of the SEC rules and regulations.  The Audit Committee held five meetings during the year ended December 31, 2011.
 
 
Item 11.  
Executive Compensation.
 
SUMMARY COMPENSATION TABLE
 
As required by the SEC, the table below summarizes the total compensation paid or earned by each of the named executive officers for the fiscal years ended December 31, 2011 and 2010.
 

 
(a)
 
(b)
 
(c)
 
(d)
 
(e)
 
(f)
 
(g)
 
(h)
 
(i)
 
(j)
 
Name and Principal Position
 
Year
 
Salary ($)
 
Bonus ($)(1)
 
Stock Awards ($)
 
Option Awards ($)
 
Non-Equity
Incentive
Plan
Compensation ($)
 
 
Change in
Pension Value
and Nonqualified
Deferred
Compensation
Earnings ($)
 
All Other
Compensation
($)(2)
 
Total ($)
 
                                                       
                                                       
Robert L. Levy
 
2011
 
$
400,000
 
$
1,000,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
27,085
 
$
1,427,085
 
President, Chief Operating Officer and
Chief Financial Officer
 
2010
 
$
400,000
 
$
800,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
127,139
 
$
1,327,139
 
                                                       
                                                       
Michael Riechman
 
2011
 
$
91,154
 
$
1,000,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
3,339
 
$
1,094,492
 
Senior Managing Director
                                                     
                                                       
                                                       
William T. Hyman
 
2011
 
$
300,000
 
$
350,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
8,575
 
$
658,575
 
Senior Managing Director
                                                     
 
(1)
Mr. Levy’s 2011 bonus will be paid in the following installments: $500,000 on March 16, 2012, $250,000 on June 8, 2012, and $250,000 on September 14, 2012.  Mr. Riechman’s 2011 bonus was paid in the following installments: $300,000 on September 16, 2011 and $700,000 on March 2, 2012.  Mr. Hyman’s 2011 bonus will be paid in the following installments: $175,000 on March 16, 2012, $87,500 on June 8, 2012, and $87,500 on September 14, 2012.
 
(2)
The amount shown in column (i) reflects for each named executive officer:
 
 
 
 
 
 
- 8 -

 
 
 
 
 
 

 

Name
 
Year
 
 
Employment
Agreement Termination Consideration
 
401(k) Matching Contributions
 
Long-term Disability and Other Insurance Benefits
 
Automobile or Transportation Allowances
 
Total
 
                                     
Robert L. Levy
 
2011
 
$
--
 
$
8,575
 
$
510
 
$
18,000
 
$
27,085
 
   
2010
 
$
100,000
 
$
8,575
 
$
564
 
$
18,000
 
$
127,139
 
                                     
Michael Riechman
 
2011
 
$
--
 
$
3,339
 
$
--
 
$
--
 
$
3,339
 
                                     
William T. Hyman
 
2011
 
$
--
 
$
8,575
 
$
--
 
$
--
 
$
8,575
 

 
OUTSTANDING EQUITY AWARDS AT FISCAL YEAR-END
 
The following table sets forth summary information concerning outstanding equity awards held by each of the named executive officers as of December 31, 2011.
 
(a)
 
(b)
 
(c)
 
(d)
 
(e)
 
(f)
 
(g)
 
(h)
 
(i)
 
(j)
 
Name
 
Number of
Securities
Underlying
Unexercised
Options (#)
Exercisable
 
Number of
Securities
Underlying
Unexercised
Options (#) Unexercisable
 
Equity
Incentive Plan
Awards:
Number of
Securities
Underlying
Unexercised
Unearned
Options (#)
 
Option
Exercise Price
($)
 
Option
Expiration
Date
 
Number of
Shares or
Units of Stock
That Have
Not Vested
 
Market Value
of Shares or
Units of Stock
That Have
Not Vested
 
Equity
Incentive Plan
Awards:
Number of
Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
 
 
Equity
Incentive Plan
Awards:
Market or
Payout Value
of Unearned
Shares, Units
or Other
Rights That
Have Not
Vested
 
                                           
Robert L. Levy
 
--
 
--
 
--
   
--
 
--
 
--
   
--
 
--
 
--
 
                                           
Michael Riechman
 
--
 
--
 
--
   
--
 
--
 
--
   
--
 
--
 
--
 
                                           
William T. Hyman
 
--
 
--
 
--
   
--
 
--
 
--
   
--
 
--
 
--
 

 
POTENTIAL PAYMENTS UPON TERMINATION OR CHANGE OF CONTROL
 
None of the named executive officers are entitled to receive payments on termination of employment or change of control of the Company.
 
TRUSTEE COMPENSATION
 
The Company uses cash compensation to attract and retain qualified candidates to serve on the Board, although trustees have the option of receiving all or a portion of their compensation in either Common Shares, cash or a combination thereof.  In setting trustee compensation, the Company considers the significant amount of time that trustees expend in fulfilling their duties to the Company as well as the skill level required by the Company of members of the Board.
 
Compensation Paid to Board Members
 
During 2011, each of our independent trustees received annual compensation at the rate of $80,000.  Mr. Loverd was paid an additional annual fee of $40,000 in consideration for his service as Chairman of the Board.  In addition, the independent trustees received annual compensation for service on committees of the Board as set forth in the chart below.
 
 
 
 
 
 
 
 
- 9 -

 
 
 
 

 
Committee
 
Chair
 
Member
 
               
Audit
 
$
25,000
 
$
15,000
 
Compensation
 
$
20,000
 
$
12,000
 
Nominating and Governance
 
$
15,000
 
$
10,000
 
Finance
 
$
10,000
 
$
7,000
 
Oversight
 
$
35,000
 
$
35,000
 

 
Trustee compensation is currently payable in cash and/or Common Shares having an aggregate value, based on the fair market value at the date of issuance.  All of the trustees have elected to received 100% of their compensation in cash.
 
Trustee Summary Compensation Table
 
The table below summarizes the compensation paid by the Company to trustees for the fiscal year ended December 31, 2011.
 
(a)
 
(b)
 
(c)
 
(d)
 
(e)
 
(f)
 
(g)
 
(h)
 
Name(1)
 
Fees Earned or
Paid in Cash
($)
 
Shares Awards
($)
 
Option Awards
($)
 
Non-Equity
Incentive Plan
Compensation
($)
 
 
Change in
Pension Value
and Deferred
Compensation
Earnings ($)
 
All Other
Compensation
($)
 
Total ($)
 
                                             
Jerome Y. Halperin
 
$
147,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
--
 
$
147,000
 
Robert L. Loverd
 
$
207,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
--
 
$
207,000
 
Robert A. Meister
 
$
142,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
--
 
$
142,000
 
Thomas W. White
 
$
150,000
 
$
--
 
$
--
 
$
--
 
$
--
 
$
--
 
$
150,000
 

(1)
Mr. Levy is not included in this table as he is a non-independent trustee and thus received no compensation for his services as trustee.  The compensation of Mr. Levy as employee of the Company is shown in the Summary Compensation Table above.
 
 
Item 12.  
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters.
 
Securities authorized for issuance under equity compensation plans
 
The following table provides information related to our incentive share plans as of December 31, 2011:

 
(a)
 
(b)
 
(c)
 
Number of securities to be issued upon exercise of outstanding options, warrants and rights
 
Weighted-average exercise price of outstanding options, warrants and rights
 
Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column a)(1)
             
Equity compensation plans approved by security holders
--
 
$
--
 
30,154,649
Equity compensation plans not approved by security holders
--
   
--
 
--
Totals
--
 
$
--
 
30,154,649
             

(1)
Our Incentive Share Plan (see Note 25 to the consolidated financial statements) authorizes us to issue options or other share-based compensation equal to 10% of the total shares outstanding (as defined in the plan) as of December 31 of the year preceding the issuance of new grants or options.
 
 
 
 
 
- 10 -

 
 
 
Securities ownership of certain beneficial owners and management and related shareholders
 
In each of the next two tables, the amounts and percentages of shares beneficially owned are reported on the basis of SEC regulations governing the determination of beneficial ownership of securities.  Under SEC rules, a person is deemed to be a “beneficial owner” of a security if that person has or shares voting power or investment power, which includes the power to dispose of or to direct the disposition of such security.  A person is also deemed to be a beneficial owner of any securities with respect to which that person has a right to acquire beneficial ownership within 60 days.  Securities that can be so acquired are deemed to be outstanding for purposes of computing such person’s ownership percentage but not for purposes of computing any other person’s percentage.  Under these rules, more than one person may be deemed to be a beneficial owner of the same securities, and a person may be deemed to be a beneficial owner of securities as to which such person has no economic interest.  Except as otherwise indicated in the footnotes to the tables, each of the beneficial owners listed has, to our knowledge, sole voting and investment power with respect to the indicated shares.
 
The amounts and percentages reported in the “Number of Voting Shares” and the “Voting Ownership Percentage” columns in each of the following two tables represent the Common Shares and the Special Preferred Voting Shares beneficially owned by each person.  The Special Preferred Voting Shares are entitled to vote, on a one-for-one basis, on all matters subject to a vote of the holders of our Common Shares, but the Special Preferred Voting Shares are not convertible into our Common Shares.  Each owner of Special Preferred Voting Shares also owns a like number of Special Common Units (“SCUs”) issued by Centerline Capital Company, LLC, one of our affiliates.  Each holder of SCUs has the right to exchange all or a portion of their SCUs for cash and to receive cash for any accrued but unpaid distributions for the quarterly period in which the exchange occurs.  We may instead exchange SCUs for Common Shares on a one-for-one basis.  However, a holder of SCUs is not deemed to beneficially own any Common Shares relating to their SCUs because SCUs may be exchanged for Common Shares only at our discretion.
 
For the purposes of the following two tables, except as noted otherwise in the footnotes to the tables, the terms below are defined as follows:
 
· “Total Common Shares” consist of 349,165,831 shares outstanding as of April 12, 2012 but exclude our non-voting shares of 320,291 Series A CRA Preferred Shares, which are convertible into 320,291 Common Shares;
 
· “Special Preferred Voting Shares” consist of 11,867,236 shares of our Special Preferred Voting Shares outstanding as of April 12, 2012.
 
The following table provides information as of April 12, 2012 with respect to the persons who beneficially own more than 5% of our outstanding Common Shares in accordance with SEC rules, as well as the Voting Ownership Percentage (as defined in footnote (2)), the number of voting shares and the voting ownership percentage for each such person.  In accordance with SEC rules, some of the Common Shares listed in the table below are deemed to be owned by more than one person (please refer to the footnotes to the table below).  The information in the table below relating to C3 Initial Assets LLC, Related Special Assets LLC, Stephen M. Ross, Jeff T. Blau, Bruce A. Beal and Wells Fargo & Company, other than information with respect to the percentages of their beneficial ownership and voting ownership percentages, has been derived from the latest Schedule 13D and 13G filings made by such persons.
 
 
 
 
 
 
- 11 -

 
 
 
 
 
Name and Address(14)
 
 
Amount and
Nature of
Beneficial
Ownership of
Common Shares
 
 
Percent of
Common Shares
Beneficially
Owned(1)
 
Amount and
Nature of
Beneficial
Ownership of
Special Preferred
Voting Shares
 
 
 
 
 
Number of
Voting Shares(2)
 
 
 
 
 
Voting Ownership
Percentage(2)
 
 
C3 Initial Assets LLC
717 Fifth Avenue
New York, NY  10022
 
139,663,545
(3)
40.0
%
--
 
139,663,545
 
38.7
%
Andrew L. Farkas
717 Fifth Avenue
New York, NY  10022
 
139,671,499
(4)
40.0
%
--
 
139,671,499
 
38.7
%
Related Special Assets LLC
60 Columbus Circle
New York, NY 10023
 
33,654,639
(5)
8.8
%
--
 
33,654,369
 
8.5
%
Stephen M. Ross
60 Columbus Circle
New York, NY 10023
 
34,532,969
(6)
9.0
%
10,194,400
(7)
44,727,369
 
11.3
%
Jeff T. Blau
60 Columbus Circle
New York, NY 10023
 
33,915,324
(8)
8.9
%
10,234,400
(9)
44,149,724
 
11.2
%
Bruce A. Beal
60 Columbus Circle
New York, NY 10023
 
33,663,824
(10)
8.8
%
10,194,400
(7)
43,858,224
 
11.1
%
Bank of America Corporation
100 N. Tryon Street
Charlotte, NC 28255
 
30,896,490
(11)
8.8
%
--
 
30,896,490
 
8.6
%
Wells Fargo & Company
420 Montgomery Street
San Francisco, CA 94163
 
27,813,625
(12)
8.0
%
--
 
27,813,625
 
7.7
%
Natixis Financial Products LLC
9 West 57th Street
New York, NY 10019
 
17,784,150
(13)
5.1
%
--
 
17,784,150
 
4.9
%
 
*
Less than 1% of the outstanding Common Shares.
 
(1)
Calculated in accordance with Rule 13d-3.
(2)
Based on (i) Total Common Shares and (ii) Special Preferred Voting Shares.
(3)
C3 Initial Assets LLC shares voting and dispositive power with respect to such shares with C-III Capital Partners LLC, Island C-III Manager LLC, Anubis Advisors LLC, Island Capital Group LLC and Andrew L. Farkas.
(4)
Includes direct beneficial ownership of 7,954 Common Shares and shared voting and dispositive power with respect to 139,663,545 Common Shares with C3 Initial Assets LLC, C-III Capital Partners LLC, Island C-III Manager LLC, Anubis Advisors LLC, and Island Capital Group LLC.
(5)
Related Special Assets LLC owns an option to purchase 33,654,639 Common Shares (the “Option”).  Mr. Ross shares voting and dispositive power with respect to such shares with Mr. Blau and Bruce A. Beal, as the terms of Related Special Assets’ operating agreement require that its investment and voting decisions must be unanimously approved by a committee of three persons, currently consisting of Mr. Ross, Mr. Blau and Mr. Beal.
(6)
Includes direct beneficial ownership of 877,645 Common Shares, indirect beneficial ownership of 33,654,639 Common Shares that could be acquired upon the exercise of the Option, and indirect beneficial ownership of 685 Common Shares owned by Related General II, L.P. (Related General II, L.P. is owned by TRCLP.  Mr. Ross owns approximately 62% of TRCLP, Mr. Blau owns approximately 18% of TRCLP, and Mr. Beal owns approximately 10% of TRCLP).
(7)
Includes indirect voting and dispositive power with respect to 10,194,400 Special Preferred Voting Shares held directly by Related General II, L.P.
(8)
Includes direct beneficial ownership of 260,000 Common Shares, indirect beneficial ownership of 33,654,639 Common Shares that could be acquired upon the exercise of the Option, and indirect beneficial ownership of 685 Common Shares owned by Related General II, L.P. (Related General II, L.P. is owned by TRCLP.  Mr. Ross owns approximately 62% of TRCLP, Mr. Blau owns approximately 18% of TRCLP, and Mr. Beal owns approximately 10% of TRCLP).
(9)
Includes direct voting and dispositive power with respect to 40,000 Special Preferred Voting Shares held directly by Mr. Blau and indirect voting and dispositive power with respect to 10,194,400 Special Preferred Voting Shares held directly by Related General II, L.P.
(10)
Includes direct beneficial  ownership of 8,500 Common Shares, indirect beneficial ownership of 33,654,639 Common Shares that could be acquired upon the exercise of the Option, and indirect beneficial ownership of 685 Common Shares owned by Related General II, L.P. (Related General II, L.P. is owned by TRCLP.  Mr. Ross owns approximately 62% of TRCLP, Mr. Blau owns approximately 18% of TRCLP, and Mr. Beal owns approximately 10% of TRCLP).
(11)
Includes indirect beneficial ownership of 24,523,020 Common Shares held by Bank of America, N.A., 3,283,755 Common Shares held by FIA Card Services, N.A., and 3,089,715 Common Shares held by Merrill Lynch Community Development Company, LLC.
(12)
Includes indirect beneficial ownership of 24,717,720 Common Shares held by Wells Fargo Community Development Corporation, and in aggregate 3,095,905 Common Shares held by Wells Fargo Bank, N.A. and Wells Fargo Advisors, LLC.
(13)
Shares voting and dispositive power with respect to such shares with Natixis North America LLC.
 
 
 
 
 
 
- 12 -

 
 
 
 
(14)
The Federal Deposit Insurance Corporation, in its capacity as Receiver, is the record owner of 24,285,165 Common Shares on behalf of the following entities: 9,269,145 Common Shares held by California National Bank, 6,179,430 Common Shares held by California Savings Bank, 4,634,580 Common Shares held by San Diego National Bank, 2,471,775 Common shares held by Indy Mac Bank, F.S.B., 1,235,880 Common Shares held by North Houston Bank, and 494,355 Common Shares held by Community Bank & Trust.  The FDIC has informed us it does not believe it is required to aggregate its beneficial ownership of such shares in these six separate receiverships (and, therefore, has not filed a Schedule 13D) and that even if it were required to aggregate its ownership under SEC Rule 13d-3, that as an “independent establishment of the United States,” under Section 3(c) of the 34 Act it is exempt from the provisions of the 34 Act.  If the FDIC were to vote these shares as a block, its aggregate voting ownership percentage would be 6.7%.
 
 
The following table provides information as of April 12, 2012 with respect to the beneficial ownership of our Common Shares in accordance with Rule 13d-3, as well as the number of voting shares and the voting ownership percentage for each of our trustees and our named executive officers and our trustees, named executive officers and executive officers as a group.
 
Name and Title
 
Amount and
Nature of
Beneficial Ownership
of Common Shares
 
Percent of
Common
Shares
Beneficially
Owned(1)
 
Number of
Voting
Shares
 
Voting
Ownership
Percentage(2)
 
                   
Robert L. Levy
Managing Trustee, President,
Chief Financial Officer and
Chief Operating Officer
 
258,292
 
*
 
258,292
 
*
 
                   
Jerome Y. Halperin
Managing Trustee
(independent trustee)
 
50,604
 
*
 
50,604
 
*
 
                   
William T. Hyman
Senior Managing Director
 
137,580
 
*
 
137,580
 
*
 
                   
Robert L. Loverd
Managing Trustee
(independent trustee)
 
64,664
 
*
 
64,664
 
*
 
                   
Robert A. Meister
Managing Trustee
(independent trustee)
 
51,535
 
*
 
51,535
 
*
 
                   
Michael Riechman
Senior Managing Director
 
--
 
0
%
--
 
0
%
                   
Thomas W. White
Managing Trustee
(independent trustee)
 
21,372
 
*
 
21,372
 
*
 
                   
All Executive Officers and
Trustees of the Company as
a group (10 persons)
 
681,400
 
*
 
681,400
 
*
 

*
Less than 1% of the outstanding Common Shares.
 
(1)
Calculated in accordance with Rule 13d-3.
 
 
 
 
 
 
- 13 -

 
 
 
 
(2)
Based on (i) Total Common Shares and (ii) Special Preferred Voting Shares.
 
 
Item 13.  
Certain Relationships and Related Transactions, and Director Independence
 
Review and Approval of Related Person Transactions
 
The nominating and governance committee of our Board (and from time to time subcommittees created by the independent trustees) reviews, monitors and approves, among others, any transactions by us in which a trustee or officer of us, CCG, or any of CCG’s affiliates has a direct or indirect personal interest.  The charter of our nominating and governance committee contains the written policy requiring the committee’s review of the related person transactions.  We have an advisory agreement with Island Centerline Manager LLC (the “Island Advisor”) and a consulting agreement with an affiliate of TRCLP (see “Item 10.  Directors, Executive Officers and Corporate Governance” above and “Other Affiliated Transactions — The Related Companies, L.P.”, below).  Any matters that arise between us and the Island Advisor under that agreement will be reviewed by the nominating and governance committee or, during its temporary tenure, the oversight committee.  Our legal staff is primarily responsible for the development and implementation of processes and controls to obtain information from the trustees and executive officers with respect to related person transactions and for then determining, based on the facts and circumstances, whether we or a related person has a direct or indirect material interest in the transaction.
 
During the year ended December 31, 2011, we had certain relationships with our Advisor, our CCG manager and our other affiliates as detailed below, and we expect we will continue to have such or similar relationships in the future.
 
Advisory and Servicing Agreements
 
See “Item 10.  Directors, Executive Officers and Corporate Governance” above for a description of our advisory agreement with Island Centerline Manager LLC.
 
C-III
 
We have a subservicing agreement with C-III Capital Partners LLC (together with its affiliates, “C-III”) pursuant to which C-III agreed to service and administer mortgage loans on our behalf.  During the years ended December 31, 2011 and 2010, we paid a total amount of $7.0 million and $6.5 million, respectively relating to these services.  In addition, in 2011 we paid C-III referral fees for mortgage loans financed by us for borrowers referred to us by C-III for the total amount of $1.2 million.
 
We have a sublease agreement with C-III relating to the leased space that we occupied and which has been used by C-III since March 2010.
 
Other Affiliated Transactions
 
The Related Companies L.P. (“TRCLP”)
 
A subsidiary of TRCLP earned fees for performing property management services for various properties held in Tax Credit Fund Partnerships we manage.
 
In addition, another affiliate of TRCLP entered into a loan agreement with our lenders (the “TRCLP Loan Agreement”) pursuant to which it assumed, in 2010, $5.0 million of our debt that was outstanding under our Term Loan and Revolving Credit Facility (the “TRCLP Indebtedness”) in connection with CCG’s entering into a consulting and advisory agreement with the TRCLP affiliate (the “TRCLP Consultant”).
 
Pursuant to the consulting and advisory agreement, the TRCLP Consultant performs certain consulting and advisory services in consideration for which CCG granted the TRCLP Consultant, among other things, certain rights of first refusal and first offer with respect to the transfer of real property owned by a Tax Credit Property Partnership controlled by CCG as well as the transfer of equity interests in Tax Credit Property Partnerships and agreed to pay the TRCLP Consultant certain fees and expenses.  The fee payable by CCG to the TRCLP Consultant is payable quarterly in an amount equal to the interest incurred on the TRCLP Indebtedness for such quarter, which is LIBOR plus 3.00%.  The consulting and advisory agreement has a three-year term and automatically renews for one year terms unless CCG provides timely written notice of non-renewal to the TRCLP Consultant.
 
 
 
 
 
 
- 14 -

 
 
 
 
The consulting and advisory agreement is terminable by CCG and the TRCLP Consultant by mutual consent as specified in the consulting and advisory agreement.  If the consulting and advisory agreement is terminated by CCG due to a change of control of the Company, CCG is obligated to pay the TRCLP Consultant a termination fee in the amount of the fair market value of the TRCLP Consultant’s remaining rights under the consulting and advisory agreement determined in accordance with procedures specified in the agreement.  If the consulting and advisory agreement is terminated by CCG because the TRCLP Consultant or any of its affiliates engaged in a specified competitive business, the Company or CCG would assume all obligations under the TRCLP Loan Agreement and indemnify the TRCLP Consultant and its affiliates for any loss, cost and expense incurred from and after the date of such assumption.
 
If CCG and the TRCLP Consultant mutually agree to terminate the consulting and advisory agreement, each party (and certain of their respective affiliates) would be obligated to pay 50% of the outstanding obligations under the TRCLP Indebtedness.  If the TRCLP Consultant terminates the consulting and advisory agreement by prior written notice to CCG absent a continuing default by CCG, the TRCLP Consultant and certain of its affiliates would be obligated to pay the outstanding obligations under the TRCLP Loan Agreement.  If the TRCLP Consultant terminates the consulting and advisory agreement in the event of a continuing default under the agreement by CCG, the Company and CCG would be jointly and severally obligated to pay the outstanding obligations under the TRCLP Loan Agreement.  If CCG terminates the consulting and advisory agreement in the event of a continuing default under the agreement by the TRCLP Consultant or in the event the TRCLP Consultant has not reasonably performed its duties under the agreement, the TRCLP Consultant and certain of its affiliates would be jointly and severally obligated to pay the outstanding obligations under the TRCLP Loan Agreement.  If CCG terminates the consulting and advisory agreement in the event of a change in control of the Company or in the event the TRCLP Consultant or any of its affiliates enters into specified competitive businesses, the Company and CCG would be jointly and severally obligated to pay the outstanding obligations under the TRCLP Loan Agreement.
 
The $5.0 million of debt assumed by TRCLP was recorded as an extinguishment of debt for which we deferred a $5.0 million gain.  The deferred gain will be recognized into income over the life of the consulting agreement.  As of December 31, 2011, the unrecognized balance was $4.97 million.
 
Fund Advances Related to Tax Credit Property Partnerships, Net
 
Fund advances related to Tax Credit Property Partnerships represent monies we loaned to certain Tax Credit Fund Partnerships to allow them to provide financial support to Tax Credit Property Partnerships in which they invest. We expect the Tax Credit Fund Partnerships will repay those loans from the release of reserves, proceeds from asset sales and other operating sources. Fund advances we made (net of reserves) were $15.6 million and $15.0 million in 2011 and 2010, respectively. In connection with the restructuring of certain credit intermediation agreements in 2010, certain of these fund advances were contributed to our Guaranteed Holdings and CFin Holdings subsidiaries.
 
Other
 
Substantially all fund origination revenues in the Affordable Housing Equity segment are received from Tax Credit Fund Partnerships we have originated and manage, many of which comprise the partnerships that we consolidate. While our affiliates hold equity interests in the investment funds’ general partner and/or managing member/advisor, we have no direct investments in these entities and we do not guarantee their obligations. We have agreements with these entities to provide ongoing services on behalf of the general partners and/or managing members/advisors and we receive all fee income to which these entities are entitled.
 
The Company entered into lock-up agreements with TRCLP, Wells Fargo Bank, NA, Bank of America, NA, and Natixis pursuant to which they agreed to certain transfer and other restrictions with respect to their Centerline equity interests.
 
 
 
 
 
- 15 -

 
 
 
 
 
Transactions with Certain 5% Holders
 
Natixis Financial Products LLC (“Natixis”) beneficially owns 5.1% of our outstanding Common Shares as shown on the table set forth under the heading “Securities ownership of certain beneficial owners and management and related shareholders” in Item 12.  We are partners with an affiliate of Natixis in two isolated special purpose entities, Centerline Financial Holdings LLC (“CFin Holdings”) and its subsidiary, Centerline Financial LLC (“Centerline Financial”), that provide credit intermediations to facilitate specified rates of return on some of the Tax Credit funds we originated.  Given current market conditions, the immediate outlook is for no new business to be carried out by our Credit Risk Products Group. In addition, due to the downgrade of Centerline Financial’s rating during the second and third quarters of 2010, Centerline Financial has been and continues to be prohibited from providing any new credit intermediations.
 
Affiliates in our Mortgage Banking segment enter into arrangements from time to time to refer mortgage banking and other financing business to, or to obtain referrals of mortgage banking and other financial business from, C3 Initial Assets LLC, which beneficially owns 40.0% of our Common Shares as shown on the table set forth under the heading “Securities ownership of certain beneficial owners and management and related shareholders” in Item 12.
 
We have entered into various agreements with affiliates of Bank of America Corporation (collectively, “BOA”) pursuant to which BOA provides Centerline with (i) a term loan and a revolving credit facility, (ii) a mortgage banking warehousing facility, and (iii) cash management services.  BOA also invests in LIHTC funds sponsored by us.  Wells Fargo & Company provides us with cash management services and invests in LIHTC funds sponsored by us.
 
Other than as more fully described above under this Item 13, we have not entered into arrangements with our other shareholders (and their affiliates) that hold 5% or more of our Common Shares (as shown on the table set forth under the heading “Securities ownership of certain beneficial owners and management and related shareholders” in Item 12).
 
Arrangements with Executive Officers
 
Mr. Levy holds equity interests in certain entities with respect to which the Company will serve and may in the future serve, as the non-equity manager and be entitled to receive economic benefits related to such equity ownership.
 
Trustee Independence
 
Our Board has adopted a formal set of Categorical Standards for Determining Trustee Independence (the “Categorical Standards”) with respect to the determination of trustee independence.  In accordance with these Categorical Standards, a trustee must be determined to have no material relationship with our Company other than as a trustee.  The Categorical Standards specify the criteria by which the independence of our trustees will be determined, including strict guidelines for trustees and their immediate families with respect to past employment or affiliation with the Company or its independent registered public accounting firm.  The Categorical Standards also limit commercial relationships of all trustees with the Company.  All trustees are required to deal at arm’s length with the Company and its subsidiaries and to disclose any circumstance that might be perceived as a conflict of interest.  These Categorical Standards were adopted when our Common Shares were listed on the NYSE, and they meet the listing standards of the NYSE.  We continue to adhere to the NYSE standards even though our shares are no longer traded on the NYSE.  In accordance with these Categorical Standards, the Board undertook its annual review of trustee independence.  During this review, the Board considered transactions and relationships between each trustee or any member of his or her immediate family and the Company and its subsidiaries and affiliates.  The Board also considered whether there were any transactions or relationships between trustees or any member of their immediate family (or any entity of which a trustee or an immediate family member is an executive officer, general partner or significant equity holder).  As provided in the Categorical Standards, the purpose of this review was to determine whether any such relationships or transactions existed that were inconsistent with a determination that the trustee is independent.
 
 
 
 
 
- 16 -

 
 
 
 
As a result of this review, the Board affirmatively determined that Mr. Halperin, Mr. Loverd, Mr. Meister and Mr. White are independent of the Company and its management under the criteria set forth in the Categorical Standards.  In making these determinations, the Board considered that, in the ordinary course of business, transactions may occur between the Company and its subsidiaries and the trustees, or companies or institutions at which some of our trustees are or have been officers.  In each case, the amount of transactions from these companies in each of the last three years did not exceed the thresholds set forth in the Categorical Standards.
 
 
Item 14.  
Principal Accounting Fees and Services.
 
Fees Paid to Independent Registered Public Accounting Firm
 
The following table presents fees for professional audit services rendered by Deloitte and Touche LLP, the member firms of Deloitte Touche Tohmatsu, and their respective affiliates (collectively, “Deloitte”) for the audit of our financial statements for the years ended December 31, 2011 and December 31, 2010, and fees for other services rendered by Deloitte during those periods.
 
   
2011
   
2010
 
 
Audit Fees(a)
  $ 1,995,000     $ 3,165,820  
Audit-Related Fees
    --       --  
Tax Fees
    313,227       98,880  
All Other Fees
    --       --  
Total
  $ 2,308,227     $ 3,264,700  
 
(a)   Fees for audit services billed for 2011 and 2010 consisted of the audit of our annual financial statements and internal controls, reviews of our quarterly financial statements, consents and other services related to SEC matters.
 

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 was compatible with the maintenance of Deloitte’s independence in the conduct of its auditing functions.
 
Policy on Pre-Approval of Independent Registered Public Accounting Firm Services
 
The audit committee is responsible for appointing, setting compensation and overseeing the work of the independent registered public accounting firm.  The audit committee has established a policy regarding pre-approval of all audit and non-audit services provided by our independent registered public accounting firm.
 
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 registered public accounting firm.  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.
 
 
 
 
 
 
 
 
- 17 -

 
 
 
PART IV
 
Item 15.  
Exhibits, Financial Statement Schedules.
 
 
 
 
 
 
 
- 18 -

 
 
 
 

 
SIGNATURES
 
 
Pursuant to the requirements of the Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 
 
CENTERLINE HOLDING COMPANY
(Registrant)
 
Date:
 
April 18, 2012
 
By:
 
/s/ Robert L. Levy
           
Robert L. Levy
President, Chief Operating Officer and
Chief Financial Officer
(Principal Executive Officer and Principal Financial Officer)

 
 
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.
 
CENTERLINE HOLDING COMPANY
(Registrant)
 
Date:
 
April 18, 2012
 
By:
 
/s/ Robert L. Levy
           
Robert L. Levy
President, Chief Operating Officer and
Chief Financial Officer
(Principal Executive Officer and Principal Financial Officer)

 
 
 
 
 
 
- 19 -

 

 
 

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, this report has been signed by the following persons on behalf of us and in the capacities and on the dates indicated:
 
Signature
 
Title
 
Date
         
 
/s/ Robert L. Levy
       
Robert L. Levy
 
Managing Trustee, President, Chief Operating Officer and Chief Financial Officer
 
April 18, 2012
 
/s/ *
       
Jerome Y. Halperin
 
Managing Trustee
 
April 18, 2012
 
/s/ *
       
Robert L. Loverd
 
Managing Trustee
 
April 18, 2012
 
/s/ *
       
Robert A. Meister
 
Managing Trustee
 
April 18, 2012
 
/s/ *
       
 
Thomas W. White   Managing Trustee   April 18, 2012
 
*  /s/ Robert L. Levy
       
Robert L. Levy
Attorney-in-fact
       

 
 
 
 
 
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