SCHEDULE 14C
(RULE 14C-101)
INFORMATION REQUIRED IN INFORMATION STATEMENT
SCHEDULE 14C INFORMATION
INFORMATION STATEMENT PURSUANT TO SECTION 14(C) OF THE SECURITIES
EXCHANGE ACT OF 1934
[ ] Preliminary information statement [ ] Confidential, for use of
the Commission only
(as permitted by
Rule 14c-5(d)(2))
[X] Definitive information statement
TIFF INVESTMENT PROGRAM, INC.
(Name of Registrant as Specified in Its Charter)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.
(1) Title of each class of securities to which transaction applies:
- -------------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
- -------------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
- -------------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
- -------------------------------------------------------------------------------
(5) Total fee paid:
- -------------------------------------------------------------------------------
[ ] Fee paid previously with preliminary materials.
- -------------------------------------------------------------------------------
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identity the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration
statement number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
- -------------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
- -------------------------------------------------------------------------------
(3) Filing Party:
- -------------------------------------------------------------------------------
(4) Date Filed:
TIFF INVESTMENT PROGRAM, INC.
TIFF EMERGING MARKETS FUND
TIFF US EQUITY FUND
2405 IVY ROAD
CHARLOTTESVILLE, VIRGINIA 22903
INFORMATION STATEMENT
WE ARE NOT ASKING YOU FOR A PROXY AND YOU ARE REQUESTED NOT TO SEND US A PROXY.
This information statement is being furnished to all persons owning shares
("members") of TIFF Emerging Markets Fund and TIFF US Equity Fund (the
"funds"), each a fund of the TIFF Investment Program, Inc. ("TIP"), to provide
such members with information regarding Lloyd George Management ("Lloyd
George") and Sit Investment Associates, Inc. ("Sit"). TIP's board of directors
has approved money manager agreements with Lloyd George (the "Lloyd George
agreement") and Sit (the "Sit agreement") (collectively, the "agreements")
that, as more fully described herein, contain substantially similar terms and
conditions as the funds' agreements with other money managers. As of March 1,
2001, the Lloyd George agreement had not been executed. The Sit agreement has
been fully executed on behalf of TIP (for the account of the US Equity Fund),
and Sit and now governs the relationship between the US Equity Fund and Sit.
TIP was not required to obtain the approval of the funds' members before
entering into the agreements because TIP has obtained an exemptive order (the
"order") from the Securities and Exchange Commission exempting TIP from certain
provisions of the Investment Company Act of 1940, as amended (the "1940 Act")
and the regulations thereunder that would otherwise mandate such approval. (The
order permits TIP to enter into new agreements or amend existing agreements
with money managers without obtaining member approval, but the exemption does
not apply to the advisory agreement with TIP's investment advisor, Foundation
Advisers, Inc., or any amendments to such agreement.) This information
statement is being provided to all members of TIFF Emerging Markets Fund and
TIFF US Equity Fund as required by one of the conditions of the order.
The board of directors of TIP expects to mail this information statement to
members on or about March 1, 2001.
FUND INFORMATION
MEMBER INFORMATION. As of February 1, 2001, the Emerging Markets Fund had
outstanding 6,480,460 shares of beneficial interests of common stock
representing a total net asset value of $46,045,938, each dollar of beneficial
interest being entitled to one vote.
As of February 1, 2001, the US Equity Fund had outstanding 18,752,061 shares of
beneficial interests of common stock representing a total net asset value of
$253,487,826, each dollar of beneficial interest being entitled to one vote.
As of February 1, 2001, the following members owned of record or beneficially
5% or more of the shares of common stock of the funds:
EMERGING MARKETS FUND
Name and Address Amount and Nature Percent
of Beneficial Owner of Beneficial Ownership of Fund
- ------------------- ----------------------- -------
Mayo Foundation 1,967,939 30.4%
200 First Street, SW
Rochester, MN 55905
Pew Memorial Trust 1,469,013 22.7%
c/o Glenmede
1 Liberty Place, Suite 1200
1650 Market Street
Philadelphia, PA 19103
The Commonwealth Fund 662,323 10.2%
One East 75th Street
New York, NY 10021
William T. Grant Foundation 523,417 8.1%
570 Lexington Avenue, 18th Floor
New York, NY 10022
2
Foundation for Seacoast Health 376,700 5.8%
100 Campus Drive, Suite 1
Portsmouth, NH 03801
US EQUITY FUND
Name and Address Amount and Nature Percent
of Beneficial Owner of Beneficial Ownership of Fund
- ------------------- ----------------------- -------
BellSouth Foundation, Inc. 2,488,514 13.3%
1155 Peachtree Street, Suite 14F05
Atlanta, GA 30309
Denver Foundation 2,006,992 10.7%
950 S. Cherry Street, Suite 200
Denver, CO 80246
East Tennessee Foundation 1,431,772 7.6%
550 W. Main Street, Suite 550
Knoxville, TN 37902
Jacksonville Community Foundation 1,361,331 7.3%
112 W. Adams St., Suite 1414
Jacksonville, FL 32202
The funds will furnish, without charge, a copy of TIP's annual report for the
period ended December 31, 2000, to any member upon request. To request a copy,
please write to TIP at 2405 Ivy Road, Charlottesville, VA 22903 or call TIP at
(800) 984-0084.
ADMINISTRATOR AND DISTRIBUTOR. Investors Capital Services, Inc., the address of
which is 600 Fifth Avenue, 26th Floor, New York, NY 10020, serves as the funds'
administrator. First Fund Distributors, Inc., the address of which is 4455 East
Camelback Road, Suite 261 E, Phoenix, AZ 85018, serves as the funds'
distributor.
INVESTMENT ADVISOR AND MONEY MANAGERS. TIP's executive offices are located at
2405 Ivy Road, Charlottesville, Virginia 22903. The funds' investment advisor
is Foundation Advisers, Inc. ("FAI"), a registered investment advisor with an
address at 2405 Ivy Road, Charlottesville, Virginia 22903. Pursuant to its
investment advisory agreement with TIP (the "advisory agreement"), FAI (a)
develops investment programs, selects money managers (the "money managers") who
each act as sub-advisors with respect to a portion of each of the fund's
assets, and monitors money manager investment activities and results; (b)
provides or oversees the
3
provision of all general management, investment advisory, and portfolio
management services to TIP; and (c) provides TIP with office space, equipment,
and personnel.
At a meeting of TIP's board of directors held on December 11, 2000, the board
unanimously approved the agreements, which contain terms and conditions
substantially similar to those of the funds' agreements with other money
managers. The following summary provides information about Lloyd George and
Sit, their investment strategies, and the terms and conditions of the
agreements. Please see the section of this information statement entitled
"Evaluation and Action by TIP Directors" for information regarding the
deliberations of the board of directors concerning approval of the agreements.
INVESTMENT MANAGEMENT SERVICES TO BE PROVIDED BY LLOYD GEORGE
Pursuant to the Lloyd George agreement, Lloyd George will provide professional
investment equity management to the Emerging Markets Fund and will manage the
assets of the Emerging Markets Fund TIP allocates to Lloyd George. TIP's board
of directors has provided Lloyd George with a set of investment management
guidelines that Lloyd George must follow in investing the assets of the
Emerging Markets Fund.
4
TERMS AND CONDITIONS OF THE LLOYD GEORGE AGREEMENT
The Lloyd George agreement was unanimously approved by TIP's board of directors
on December 11, 2000. Members are not being asked to approve the Lloyd George
agreement. As of March 1, 2001, the Lloyd George agreement had not been
executed and Lloyd George had not yet begun to invest in the Emerging Markets
Fund.
MONEY MANAGEMENT FEES. As compensation for the services performed and the
facilities and personnel provided by Lloyd George pursuant to this agreement,
the Emerging Markets Fund will pay Lloyd George a fee according to the
following schedule:
1.30% First $5 million
1.20% Next $15 million
1.10% Next $30 million
1.00% Next $50 million
0.90% Above $100 million
BASIC TERMS. The Lloyd George agreement has an initial term of two years and
provides that it will thereafter continue in effect from year to year only if
such continuation is specifically approved at least annually by (a) either (i)
a vote of a majority of the board of directors of TIP or (ii) a vote of a
majority of the outstanding voting securities of the Emerging Markets Fund and
(b) a vote of a majority of the fund's directors who are not "interested
persons" as defined in the 1940 Act (the "independent directors"). The Lloyd
George agreement provides that it may be terminated by the Emerging Markets
Fund, by TIP's board of directors, or by a vote of a majority of the
outstanding voting securities of the Emerging Markets Fund, or by Lloyd George,
in each case at any time upon 30 days' written notice to the other party. In
addition, the agreement provides for its automatic termination in the event of
assignment.
The Lloyd George agreement provides that Lloyd George is required to manage the
securities held by the Emerging Markets Fund, subject to the supervision and
stated direction of FAI, the fund's investment advisor, and ultimately TIP's
board of directors, in accordance with the fund's investment objective and
policies; make investment decisions for the fund; and place orders to purchase
and sell securities on behalf of the fund.
The Lloyd George agreement provides that Lloyd George is not liable to the
Emerging Markets Fund for any error of judgment but shall be liable to the
Emerging Markets Fund for any loss resulting from willful misfeasance, bad
faith, or gross negligence by Lloyd George in providing services under the
Lloyd George agreement or from reckless disregard by Lloyd George of its
obligations and duties under the Lloyd George agreement.
5
BACKGROUND INFORMATION REGARDING LLOYD GEORGE
The principal officers of Lloyd George and their principal occupations are as
follows:
NAME POSITION
- ---- --------
Robert Lloyd George Chairman, founded Lloyd George in 1991.
William Kerr Finance director and chief operating officer, joined
Lloyd George in 1991.
M.F. Tang Director, joined Lloyd George in 1991.
Pamela Chan Director, joined Lloyd George in 1994.
Adeline Ko Director, joined Lloyd George in 1994.
Jacob Rees-Mogg Director, joined Lloyd George in 1993.
The business address of each of the officers listed above is Suite 3808, One
Exchange Square, Central, Hong Kong.
INVESTMENT MANAGEMENT SERVICES TO BE PROVIDED BY SIT
Pursuant to the Sit agreement, Sit will provide professional investment equity
management to the US Equity Fund and will manage the assets of the US Equity
Fund TIP allocates to Sit. TIP's board of directors has provided Sit with a set
of investment management guidelines that Sit must follow in investing the
assets of the US Equity Fund.
TERMS AND CONDITIONS OF THE SIT AGREEMENT
The Sit agreement was unanimously approved by TIP's board of directors on
December 11, 2000. Members are not being asked to approve the Sit agreement. On
January 2, 2001, Sit began investment in the US Equity Fund.
MONEY MANAGEMENT FEES. As compensation for the services performed and the
facilities and personnel provided by Sit pursuant to this agreement, the US
Equity Fund will pay Sit a fee according to the following schedule:
0.65% First $10 million
0.60% Next $10 million
0.55% Next $10 million
6
0.50% Next $10 million
0.45% Next $10 million
0.40% Above $50 million
BASIC TERMS. The Sit agreement has an initial term of two years and provides
that it will thereafter continue in effect from year to year only if such
continuation is specifically approved at least annually by (a) either (i) a
vote of a majority of the board of directors of TIP or (ii) a vote of a
majority of the outstanding voting securities of the US Equity Fund and (b) a
vote of a majority of the fund's directors who are not "interested persons" as
defined in the 1940 Act (the "independent directors"). The Sit agreement
provides that it may be terminated by the US Equity Fund, by TIP's board of
directors, or by a vote of a majority of the outstanding voting securities of
the US Equity Fund, or by Sit, in each case at any time upon 30 days' written
notice to the other party. In addition, the agreement provides for its
automatic termination in the event of assignment.
The Sit agreement provides that Sit is required to manage the securities held
by the US Equity Fund, subject to the supervision and stated direction of FAI,
the fund's investment advisor, and ultimately TIP's board of directors, in
accordance with the fund's investment objective and policies; make investment
decisions for the fund; and place orders to purchase and sell securities on
behalf of the fund.
The Sit agreement provides that Sit is not liable to the US Equity Fund for any
error of judgment but shall be liable to the US Equity Fund for any loss
resulting from willful misfeasance, bad faith, or gross negligence by Sit in
providing services under the Sit agreement or from reckless disregard by Sit of
its obligations and duties under the Sit agreement.
BACKGROUND INFORMATION REGARDING SIT
The principal officers of Sit and their principal occupations are as follows:
NAME POSITION
- ---- --------
Eugene C. Sit, CFA, Chairman, CEO, and global CIO, Sit Investment
CPA Associates, Inc. Founded Sit in 1981.
Peter L. Mitchelson, President and chief strategist, Sit Investment
CFA Associates, Inc. Joined Sit in 1981.
Roger J. Sit Executive vice president of Sit Investment Associates,
Inc. and global research director, president and deputy
CIO for Sit/Kim
7
International since 1998. Prior to 1998 Mr. Sit was a
vice president and senior equity research analyst at
Goldman Sachs.
The business address of each of the officers listed above is 90 South Seventh
Street, Suite 4600, Minneapolis, Minnesota 55402.
8
EVALUATION AND ACTION BY TIP DIRECTORS
At a meeting on December 11, 2000, the directors of TIP considered information
with respect to whether the agreements are in the best interests of the funds
and their members. The directors considered, with respect to Sit and Lloyd
George, among other factors, their respective long-term track records serving
the institutional investment community, their approach to US and emerging
market equities, and their administrative capabilities and experience.
Based upon its review, the board of directors concluded that the agreements are
reasonable, fair, and in the best interests of the funds and their members and
that the fees provided in such agreements are fair and reasonable. In the
board's view, retaining Sit and Lloyd George to serve as money managers of the
funds under the terms of the agreements is desirable and in the best interests
of the funds and their members. Accordingly, after consideration of the above
factors and such other factors and information as it deemed relevant, the board
of directors, including all of the independent directors in attendance at the
meeting, unanimously approved the agreements.
FEBRUARY 27, 2001