As filed with the Securities and Exchange Commission on May 3, 2001
Registration No. 2-78066
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE
SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant [x]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of Commission Only
[x] Definitive Proxy Statement
[ ] Definitive Additional Materials
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AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL
ORGANIZATIONS HOUSING INVESTMENT TRUST
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PAYMENT OF FILING FEE:
[x] No fee required.
[ ] Fee computed on the table below per Exchange Act Rules 14a(6)-(i)(4)
and 0-11.
1) Title of Each Class of securities to which transaction applies:
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2) Aggregate Number of Securities to which transaction applies:
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3) Per Unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11:
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4) Proposed maximum aggregate value of transaction:
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5) Total fee paid:
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[ ] 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 identify 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:
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2) Form, Schedule or Registration Statement Number:
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3) Filing Party:
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4) Date Filed:
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May 3, 2001
TO PARTICIPANTS, AFL-CIO HOUSING INVESTMENT TRUST
Enclosed is the Notice of 2001 Annual Meeting of Participants and a Proxy
Statement describing the election of Trustees, proposed amendments to the
Declaration of Trust and other indicated matters that are expected to come up
at the meeting.
Also enclosed is a proxy card for each Participant noting the number of Units
held by that Participant and the exact name in which those Units are
registered. A Participant that does not wish to send a representative to the
meeting should vote its Units by mail, internet or facsimile, as described
herein, as soon as possible.
Sincerely,
Stephen Coyle
Chief Executive Officer
PLEASE VOTE WITHIN FIVE DAYS OF RECEIPT
Enclosures
AFL-CIO HOUSING INVESTMENT TRUST
PROXY
2001 Annual Meeting of Participants
The undersigned hereby appoints Michael M. Arnold and Helen R. Kanovsky
and each of them with power to act without the other and with full power of
substitution, as proxies for and on behalf of the undersigned, to vote all
Units of Participation which the undersigned is entitled to vote at the Annual
Meeting of Participants to be held May 22, 2001 and all adjournments thereof,
with all the powers that the undersigned would possess if personally present
and particularly (but without limiting the generality of the foregoing) to
vote and act as follows:
(I) For the election of a Chairman to serve until the 2002 Annual
Meeting of Participants and until his successor is elected and qualifies:
Richard Ravitch
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(II) For the reelection of four (4) Class III Union Trustees and two
(2) Class III Management Trustees to serve until the 2004 Annual Meeting of
Participants and until their successors are elected and qualify, and for the
election of one (1) Class II Union Trustee to serve until the 2003 Annual
Meeting of Participants and until his successor is elected and qualifies:
John Sweeney (Class III Union Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Frank Hurt (Class III Union Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Michael E. Monroe (Class III Union Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Terence M. O'Sullivan (Class III Union Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Tony Stanley (Class III Management Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Patricia F. Wiegert (Class III Management Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
Jeremiah J. O'Connor (Class II Union Trustee)
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(III) To approve an amendment to the Trust's Declaration of Trust to
provide more explicit authorization for the Trust to engage in activities that
are designed to generate potential investments in which the Trust is
authorized to invest, including but not limited to activities that also
generate fees for the Trust or benefit unions and/or union members:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(IV) To approve an amendment to the Trust's Declaration of Trust to
modify the investment policy to allow the Trust to invest up to ten percent
(10%) of its assets in United States Treasury issues and obligations which are
issued or guaranteed by Fannie Mae, Freddie Mac or the Federal Home Loan Banks
or which are backed by Fannie Mae, Freddie Mac or the Federal Home Loan Banks
and rated in one of the two highest rating categories, provided that such
instruments have a scheduled maturity of 10 years or less:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
(V) For ratification of the Board of Trustees' selection of Arthur
Andersen LLP as independent public accountants for the Trust's 2001 fiscal
year:
FOR [ ] AGAINST [ ] ABSTAIN [ ]
and upon such other matters as may properly come before the meeting.
FOR [ ] AGAINST [ ] ABSTAIN [ ]
The Trustees recommend a vote FOR the above items. ANY PROXY NOT MARKED
OTHERWISE WILL BE TREATED AS A VOTE FOR THE ITEMS.
---
May 3
The Units of Participation represented hereby will be voted in accordance
with instructions contained in this Proxy.
The undersigned hereby ratifies and confirms all that said proxies or
their substitutes or any of them may lawfully do by virtue hereof. The
undersigned hereby acknowledges receipt of the Notice of 2001 Annual Meeting
of Participants dated May 3, 2001 and the Proxy Statement dated May 3, 2001.
Dated: ________________, 2001
Participant ID:
Participant Name:
Number of Units:
By:
-----------------------
Signature
---------------------
(Name-please print)
Title:
--------------------
(please print)
Please sign your name and indicate your capacity as attorney, trustee or
official of a Participant.
- ---------------------------------------------------------------------------
To vote via the Internet, please use the following User Name and Password*:
User Name:
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Password:
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- ----------------------------------------------------------------------------
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF TRUSTEES OF THE TRUST.
IMPORTANT: THIS PROXY MAY BE VOTED IN ANY OF THREE (3) WAYS:
BY MAIL: PLEASE SIGN, DATE AND MAIL THIS PROXY PROMPTLY IN THE ENCLOSED
SELF-ADDRESSED, STAMPED ENVELOPE.
BY FACSIMILE: PLEASE SIGN, DATE AND FAX THIS PROXY TO (202) 331-8190.
BY INTERNET: PLEASE GO TO http://www.aflcio-hit.com/proxy AND ENTER THE USER
NAME AND PASSWORD ENCLOSED ABOVE.
PLEASE NOTE THAT ALL VOTES MUST BE TIME-STAMPED OR
POSTMARKED BY MIDNIGHT ON MAY 22, 2001.
- -------------------------
*Please note the User Name and Password are case-sensitive.
AFL-CIO HOUSING INVESTMENT TRUST
NOTICE OF 2001 ANNUAL MEETING OF PARTICIPANTS
To Participants, AFL-CIO Housing Investment Trust:
Notice is hereby given that the 2001 annual meeting of Participants (the
"Meeting") of the American Federation of Labor and Congress of Industrial
Organizations Housing Investment Trust (the "Trust"), a District of Columbia
common law trust, will be held at the offices of the Trust, 1717 K Street,
N.W., Suite 707, Washington, D.C., 20036 on May 22, 2001 at 2:00 p.m. for the
following purposes:
1. To elect a Chairman to hold office until the 2002 Annual Meeting
of Participants and until his successor is elected and qualifies;
2. To reelect four (4) Class III Union Trustees and two (2) Class III
Management Trustees to hold office until the 2004 Annual Meeting of
Participants and until their respective successors are elected and
qualify, and to elect one (1) Class II Union Trustee to hold office
until the 2003 Annual Meeting of Participants and until his successor
is elected and qualifies;
3. To approve an amendment to the Trust's Declaration of Trust to provide
more explicit authorization for the Trust to engage in activities that
are designed to generate potential investments in which the Trust is
authorized to invest, including but not limited to activities that also
generate fees for the Trust or benefit unions and/or union members;
4. To approve an amendment to the Trust's Declaration of Trust to modify
the investment policy to allow the Trust to invest up to ten percent
(10%) of its assets in United States Treasury issues and obligations
which are issued or guaranteed by Fannie Mae, Freddie Mac or the
Federal Home Loan Banks or which are backed by Fannie Mae, Freddie Mac
or the Federal Home Loan Banks and rated in one of the two highest
rating categories, provided that such instruments have a scheduled
maturity of 10 years or less;
5. To ratify the selection of Arthur Andersen LLP as the independent
public accountants for the Trust's fiscal year ending December 31,
2001; and
6. To transact such other business as may properly come before the Meeting
or any adjournment or adjournments thereof.
The Board of Trustees has fixed the close of business on March 31, 2001
as the record date for the determination of Participants entitled to notice of
and to vote at the Meeting and any adjournment(s) thereof. Accordingly, only
Participants of record as of the close of business on that date are entitled
to notice of and to vote at the Meeting or at any such adjournment. The
transfer books of the Trust will not be closed.
By Order of the Board of Trustees
Stephen Coyle
Chief Executive Officer
Dated: May 3, 2001
AFL-CIO HOUSING INVESTMENT TRUST
PROXY STATEMENT
May 3, 2001
GENERAL MATTERS
This Proxy Statement is furnished in connection with the solicitation of
proxies for use at the annual meeting of Participants (the "Meeting") of the
American Federation of Labor and Congress of Industrial Organizations Housing
Investment Trust (the "Trust") to be held at the offices of the Trust, 1717 K
Street, N.W., Suite 707, Washington, D.C. 20036, on Tuesday, May 22, 2001,
beginning at 2:00 p.m. and at any adjournment(s) thereof.
A copy of the Trust's annual report for the year ended December 31, 2000
was previously mailed to each Participant entitled to vote at the Meeting
together with financial statements for the fiscal year ended December 31,
2000. The Trust will furnish, without charge, a copy of the annual report for
2000 and the most recent semi-annual report succeeding the annual report, if
any, to any Participant that requests one. Requests for reports should be
made by placing a collect call to the Trust, at (202) 331-8055, directed to
Stephanie Turman. Written requests may be directed to Michael Arnold,
Executive Vice President - Marketing, Investor and Labor Relations, AFL-CIO
Housing Investment Trust, 1717 K Street, N.W., Suite 707, Washington, D.C.
20036.
ABOUT THE MEETING
WHAT IS THE PURPOSE OF THE ANNUAL MEETING?
At the Trust's annual Meeting, Participants will act upon the matters
outlined in the accompanying notice of Meeting, including (i) the election of
a Chairman of the Board of Trustees, (ii) election of Trustees, (iii) approval
of amendments to the Trust's Declaration of Trust to authorize the Trust to
engage in activities that are designed to generate potential investments for
the Trust and permit the Trust to invest in certain United States Treasury,
Fannie Mae, Freddie Mac and Federal Home Loan Banks obligations, and (iv)
ratification of the selection of the Trust's independent auditors. In
addition, the Trust's management will respond to questions from Participants.
WHO IS ENTITLED TO VOTE?
As of the close of business on March 31, 2001, the date set by the Board
of Trustees as the record date for the determination of Participants entitled
to notice of and to vote at the Meeting and any adjournment(s) thereof (the
"Record Date"), there were 2,315,855.5973 Units of Participation of the Trust
outstanding, each Unit being entitled to one vote. No shares of any other
class of securities were outstanding as of that date.
Only Participants of record as of the close of business on the Record
Date, will be entitled to vote at the Meeting.
WHO CAN ATTEND THE MEETING?
All Participants as of the Record Date, or their duly appointed proxies,
may attend the Meeting.
WHAT CONSTITUTES A QUORUM?
A quorum for the Meeting is the presence in person or by proxy of
Participants holding a majority of Units outstanding at the close of business
on the Record Date. As of the Record Date, 2,315,855.5973 Units of
Participation of the Trust were outstanding. Proxies received but marked as
abstentions will be included in the calculation of the number of shares
considered to be present at the Meeting.
HOW DO I VOTE?
By Mail: If the proxy card that is enclosed with this Proxy Statement is
-------
properly executed and returned, the Units of Participation it represents will
be voted at the Meeting in accordance with the instructions noted thereon. If
no direction is indicated, the proxy card will be voted in accordance with the
Trustees' recommendations set forth thereon.
By Facsimile: If the proxy card that is enclosed with this Proxy
------------
Statement is properly executed and returned via facsimile to (202)331-8190,
the Units of Participation it represents will be voted at the Meeting in
accordance with the instructions noted thereon. If no direction is indicated,
the proxy card will be voted in accordance with the Trustees' recommendations
set forth thereon.
By Internet: If the proxy card is properly voted through the Internet,
-----------
the Units of Participation it represents will be voted at the Meeting in
accordance with the instructions noted thereon. If no direction is indicated,
the proxy card will be voted in accordance with the Trustees' recommendations
set forth thereon.
To vote by proxy through the Internet:
1) Use a web browser to go to http://www.aflcio-hit.com/proxy
2) Enter the User Name* and Password* that are included with this
mailing.
*Please note that the User Name and Password are CASE-SENSITIVE.
Please type the User Name and Password into the appropriate screen
exactly as it is shown on the enclosure.
In Person: By attending the Meeting and voting your Units.
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CAN I CHANGE MY VOTE AFTER GIVING A PROXY?
Yes. Any Participant giving a Proxy may revoke it at any time before it
is exercised by giving written notice to the Trust bearing a date later than
the date of the Proxy, by submission of a later dated Proxy, or by voting in
person at the Meeting, which any Participant may do whether or not such
Participant has previously given a Proxy.
2
WHAT ARE THE BOARD OF TRUSTEE'S RECOMMENDATIONS?
Unless you give other instructions when you vote, the persons named as
proxy holders on the proxy card will vote in accordance with the
recommendations of the Board of Trustees. The Board's recommendation is set
forth together with the description of each item in this proxy statement. In
summary, the Board recommends a vote:
- - for election of the nominated Chairman (see page 3);
- - for election of the nominated Trustees (see page 3);
- - for approval of an amendment to the Trust's Declaration of Trust to
modify the investment policy to provide more explicit authorization for
the Trust to engage in activities that are designed to generate
potential eligible investments for the Trust (see page 14);
- - for approval of an amendment to the Trust's Declaration of Trust to
modify the investment policy to allow the Trust to invest up to ten
percent (10%) of its assets in certain United States Treasury, Fannie
Mae, Freddie Mac and Federal Home Loan Banks obligations (see page
14); and
- - for ratification of the selection of Arthur Andersen LLP as the
independent public accountants for the Trust's fiscal year ending
December 31, 2001 (see page 15).
With respect to any other matter that properly comes before the Meeting
or any adjournment or adjournments thereof, the proxy holders will vote as
recommended by the Board of Directors or, if no recommendation is given, in
their own discretion.
WHAT VOTE IS REQUIRED TO APPROVE EACH ITEM?
As to Proposals I, II, III, IV and V, the vote required for approval will
be a majority of the Units represented in person or by proxy at the Meeting.
Each Unit is entitled to one vote.
WHO ARE THE PRINCIPAL HOLDERS OF THE TRUST'S VOTING SECURITIES?
The following table sets forth the beneficial ownership information as of
March 31, 2001, with respect to each Labor Organization and Eligible Pension
Plan (as each of those terms is defined in the Trust's Declaration of Trust)
known to the Trust to be the beneficial owner of more than 5 percent (that is
more than 115,792.7799 Units) of the Trust's 2,315,855.5973 outstanding Units
of Participation. Because only Labor Organizations and Eligible Pension Plans
are eligible to own Units of Participation in the Trust, no Units of
Participation are owned by any Trustee or nominee individually. The Units are
the only class of securities or units of beneficial ownership issued by the
Trust.
3
Name and Address of Beneficial Owner Number of Units Percent of Total Units
- ------------------------------------- ---------------- ----------------------
Central Pension Fund of the
International Union of
Operating Engineers
415 Chesapeake Street, N.W.
Washington, D.C. 20016 119,194.5781 Units 5.15%
WHO IS MAKING THE SOLICITATION ON BEHALF OF THE TRUST?
The Proxy is being solicited by the Board of Trustees of the Trust
through the mail. The cost of solicitation will be paid by the Trust.
Further solicitation of proxies may be made by telephone or oral communication
with some Participants following the original solicitation. Any such further
solicitation will be made by Trustees or officers of the Trust who will not be
compensated therefor. The date on which proxy materials were first mailed to
Participants was May 3, 2001.
ELECTION OF TRUSTEES
PROPOSAL I: TO REELECT THE CHAIRMAN
PROPOSAL II: TO REELECT FOUR (4) CLASS III UNION TRUSTEES AND TWO
(2) CLASS III MANAGEMENT TRUSTEES AND TO ELECT ONE (1)
CLASS II UNION TRUSTEE
Under the Trust's Declaration of Trust, the Board of Trustees may have up
to 25 Trustees. Up to 12 Trustees may be Union Trustees, up to 12 Trustees
may be Management Trustees, and one Trustee is to be the Chairman. The Board
of Trustees currently consists of 19 Trustees, 11 of whom are Union Trustees
(Chavez-Thompson, Flynn, Hanley, Hurt, Maddaloni, Monroe, O'Sullivan, Stern,
Sullivan, Sweeney and Trumka), 7 of whom are Management Trustees (Cullerton,
Fleischer, Kardy, Latimer, Spear, Stanley and Wiegert), and one of whom is the
Chairman (Ravitch). Proxies will not be voted for a greater number of persons
than the number of nominees named.
The Declaration of Trust divides the Union and Management Trustees into
three classes (each, a "Class"). Each Class is required to have, insofar as
the pool of Trustees permits, an equal number of Union and Management
Trustees. The term of each Class expires at the third annual meeting
following its election; the term of one Class expires each year. At each
annual meeting, the Participants elect a Chairman to serve until the next
annual meeting and such number of Trustees as is necessary to fill vacancies
in (i) the Class whose terms expire as of that meeting, and (ii) any other
Class. The terms of office of Trustees Hurt, Monroe, O'Sullivan, Stanley,
Sweeney, and Wiegert and Chairman Ravitch will expire on the day of the
Meeting*. The principal occupations and business experience for the past five
years of these Class III Trustees standing for reelection are described below
under "Nominees for Reelection."
In addition to Class III Trustees standing for reelection, the Board of
Trustees has recommended an additional nominee to serve on the Board of
Trustees to fill a vacancy in Class II. Jeremiah J. O'Connor is standing for
election as a Class II Union Trustee. Mr. O'Connor's principal occupation and
business experience for the past five years are described below under "Nominee
for Election."
- ---------------
*Class III Management Trustee Terrence R. Duvernay, whose term would have
expired on the day of the Meeting, passed away in April, 2001.
4
If a proxy in the enclosed form is received from a Participant, the Units
of Participation represented by such Proxy will be voted for the nominees
listed below (unless otherwise indicated on the proxy). Class III Trustees
will serve for three-year terms ending in 2004 and until their respective
successors are elected and qualify.
Although the Trust does not contemplate that any of the nominees will be
unavailable for election, if a vacancy in the slate of nominees should be
occasioned by death or other unexpected occurrence, it is currently intended
that the proxies will be voted for such other persons, if any, as the
Executive Committee may recommend.
NOMINEES FOR REELECTION
The following information was furnished to the Trust by each nominee and
sets forth the name, age, principal occupation or employment of each nominee
and the period during which he or she has served as a Trustee of the Trust.
Each nominee has consented to be named in this Proxy Statement and to serve on
the Board of Trustees if elected.
Principal Occupation/Business Experience Trustee
Name During Past 5 Years Since Age
- ---- ----------------------------------------- -------- ---
Richard Ravitch Principal, Ravitch, Rice & Co. LLC; 1992 67
formerly, President and Chief Executive
Officer, Player Relations Committee of
Major League Baseball; formerly, Chairman,
Aquarius Management Corporation
(limited profit housing project management);
formerly, Chairman and Chief Executive
Officer, Bowery Savings Bank
John Sweeney President, AFL-CIO; formerly, International 1981 66
President, Service Employees International
Union
Frank Hurt President, Bakery, Confectionery & Tobacco 1993 62
Workers and Grain Millers International
Union
Michael E. Monroe General President, International Union 1998 50
of Painters and Allied Trades (IUPAT);
formerly, General Vice President, IUPAT
Terence M.
O'Sullivan General President, Laborers' International 2000 45
Union of North America (LIUNA); formerly,
Vice President, Mid-Atlantic Regional Manager
and Assistant to the General President, LIUNA
5
Principal Occupation/Business Experience Trustee
Name During Past 5 Years Since Age
- ---- ----------------------------------------- -------- ---
Tony Stanley Executive Vice President and Director, 1985 67
TransCon Builders, Inc. (building
construction)
Patricia F. Wiegert Retirement Administrator, Contra Costa 1995 54
County (California) Employees' Retirement
Association
NOMINEE FOR ELECTION
The following nominee will stand for election at the 2001 Meeting of
Participants. The nominee has consented to be named in this Proxy Statement
and to serve on the Board of Trustees if elected.
Principal Occupation/Business Experience
Name During Past 5 Years Age
- ---- ----------------------------------------- ---
Jeremiah J.
O'Connor Secretary-Treasurer, International 66
Brotherhood of Electrical Workers (IBEW);
formerly International Vice President,
6th District, IBEW
THE BOARD OF TRUSTEES RECOMMENDS THAT PARTICIPANTS VOTE "FOR" THE
REELECTION OF THE NOMINATED CHAIRMAN AND CLASS III TRUSTEES AND "FOR"
THE ELECTION OF THE NOMINATED CLASS II TRUSTEE.
INCUMBENT TRUSTEES
The following incumbent Trustees will continue in office in accordance
with the Trust's Declaration of Trust, and are expected to stand for
reelection at subsequent annual meetings of Participants.
Principal Occupation/Business Experience Trustee
Name During Past 5 Years Since Age
- ---- ----------------------------------------- -------- ---
Francis X. Hanley General President (formerly General 1990 70
Secretary-Treasurer) International Union
of Operating Engineers
Alfred J. Fleischer Chairman, Fleischer Company; formerly 1992 80
Chairman, Fleischer-Seeger Construction
Corporation; formerly, a Director of the
National Corporation for Housing Partner-
ships of Washington, D.C.
Richard L. Trumka Secretary-Treasurer, AFL-CIO; formerly, 1995 51
President, United Mine Workers of America
6
Principal Occupation/Business Experience Trustee
Name During Past 5 Years Since Age
- ---- ----------------------------------------- -------- ---
Marlyn J. Spear Chief Investment Officer, Milwaukee and 1995 47
Vicinity Building Trades United Pension
Trust Fund; formerly, Investment Coordinator
Linda Chavez-
Thompson Executive Vice President, AFL-CIO; 1996 56
formerly, International Vice President,
American Federation of State, County and
Municipal Employees
Walter Kardy President, Specialty Contractor's 1996 73
Management Inc.
George Latimer Distinguished Visiting Professor of Urban 1996 65
Studies, Macalester College; formerly,
Chief Executive Officer, National
Equity Fund (a tax credit investment
company); formerly, Director,
Special Actions Office, HUD
John E. Cullerton Chairman, Central Pension Fund of the 1998 86
International Union of Operating
Engineers and Consultant to the Hotel
Employees and Restaurant Employees
International Union; formerly, Fund Advisor
to Trustees for the Hotel Employees and
Restaurant Employees International Union
Health, Welfare and Pension Funds
Martin J. Maddaloni President, United Association of 1998 61
Journeyman and Apprentices of the
Plumbing and Pipefitting Industry of the
United States and Canada (UA); formerly,
International Vice President UA District 2;
formerly, International Representative, UA;
formerly, Special Representative, UA
Andrew Stern President, Service Employees Inter- 1998 50
national Union
John J. Flynn President, International Union of 2000 66
Bricklayers and Allied Craftworkers (BAC);
formerly, President and Secretary-
Treasurer, BAC Local 1 Missouri
Edward C. Sullivan President, Building and Construction 2000 57
Trades Department, AFL-CIO; formerly,
General President, International Union
of Elevator Constructors
None of the Trustees meets the definition of an "interested trustee" as
set forth in the Investment Company Act of 1940.
7
EXECUTIVE OFFICERS
The executive officers of the Trust are elected by the Board of Trustees
and serve one-year terms. The executive officers of the Trust are as follows:
Stephen Coyle, age 55, has served as Chief Executive Officer of the Trust
since 1992. Mr. Coyle served as Director of the Boston Redevelopment
Authority from July 1984 to January 1992. Prior to that, he served as Chief
Executive Officer of John Carl Warnecke & Associates in San Francisco, a
national firm for architecture and urban design. From 1977 through 1980, Mr.
Coyle served the Federal Government in Washington, D.C. as Deputy Under
Secretary of the United States Department of Health and Human Services and
Executive Assistant to the Secretary of the United States Department of
Housing and Urban Development. Mr. Coyle earned his Bachelor's degree from
Brandeis University, his Master's degree from the Harvard Kennedy School of
Government, and a law degree from Stanford Law School.
Michael M. Arnold, age 61, has served as Executive Vice President
Marketing, Investor and Labor Relations of the Trust since January, 2001.
Prior to that Mr. Arnold served as Executive Vice President - Marketing of the
Trust from April, 1999 to December, 2000. Mr. Arnold joined the Trust in
April 1985 as Director of Investor Relations after being employed by the
AFLCIO Human Resources Development Institute (HRDI) since 1969. During his
tenure with HRDI, he held the positions of area representative, regional
director, assistant director and executive director. As executive director
during the six years prior to being employed by the Trust, he was responsible
for overall administration and fiscal affairs and the general supervision of
staff located at the national office in Washington, D.C. and in field offices
in 59 major metropolitan areas of the country. During this period, Mr._Arnold
worked extensively with officers and staff of international, state and local
labor organizations. In 196768, Mr. Arnold was manpower coordinator and labor
liaison officer with the Dallas Community Action Agency. He is a 43year
member and former local union officer of the International Union of
Bricklayers and Allied Craftsworkers, and is also a licensed real estate
broker.
Helen R. Kanovsky, age 50, has served as Executive Vice President -
Finance and Administration of the Trust since August 1999. Ms. Kanovsky
previously served as the General Counsel of the Trust from 1995 until 1998,
and re-joined the Trust in August, 1999 after being employed as Chief of Staff
for U.S. Senator John F. Kerry in 1998-99. Prior to joining the Trust, Ms.
Kanovsky served as Executive Vice President and General Counsel of GE Capital
Asset Management Corporation and its predecessor company, Skyline Financial
Services Corporation from 1986-1994. She was in private law practice as a
partner with Leff & Mason from 1984-1986, and a partner and associate with
Dickstein, Shapiro and Morin from 1981-84 and 1976-79. From 1979-81, Ms.
Kanovsky served in the federal government as a Special Assistant to the
Secretary of Health, Education and Welfare, as Associate Executive Secretary
to the Department of Health & Human Services, and as a Special Assistant to
the Secretary of Housing and Urban Development. Ms. Kanovsky earned her
Bachelor's degree from Cornell University and her Juris Doctor degree from
Harvard Law School.
Patton H. Roark, Jr., age 34, has served as Executive Vice President
Investments since January, 2001 and as Portfolio Manager of the Trust since
December 1997. Mr. Roark joined the Trust in 1993 as Assistant Portfolio
Manager. Prior to joining the Trust, Mr. Roark was a Senior Auditor, who
specialized in mortgage finance and securitization for Price Waterhouse, an
8
international accounting firm, from 1990 to 1993. From 1989 to 1990, Mr.
Roark was an internal auditor with the Inspector General's office of the
Office of Personnel Management. Mr. Roark is a Chartered Financial Analyst,
Certified Public Accountant and Certified Internal Auditor, and earned his
Bachelors of Science degree in accounting from Shepherd College.
Eileen Fitzgerald, age 38, joined the Trust in March 2000, as Director of
Single Family Finance and has served as Chief Investment Officer - Single
Family Finance since January, 2001. Prior to joining the Trust, from
December 1994 to March 2000, Ms. Fitzgerald served as Acting Administrator,
Associate Administrator and Executive Assistant to the Administrator of the
Rural Housing Service (RHS), the successor to the Farmers Home Administration,
at the Department of Agriculture. At RHS, Ms. Fitzgerald directed and managed
all programs and initiated several new partnerships, including the Rural Home
Loan Partnership, a program that brings together local lenders, RHS and
nonprofit organizations to provide home ownership opportunities, and which
grew to 175 partnerships in 5 years. She also oversaw the development and
implementation of the Centralized Servicing Center in St. Louis that
centralized the servicing of an $18 billion, 600,000 plus single-family loan
portfolio from 1200 decentralized offices. Prior to joining RHS, from October
1991 to July 1994, Ms. Fitzgerald worked with the Virginia Center on Rural
Developments and from August 1989 to October 1991, she served both the
Governor and the Secretary of Housing and Community Development in Maryland.
Ms. Fitzgerald was also a Senior Financial Analyst for a New York real estate
syndication firm from January 1985 to August 1987. Ms. Fitzgerald earned her
Bachelors of Science degree in Finance and Economics from Fordham University
and her Masters in Public Affairs from the Woodrow Wilson School of Public and
International Affairs at Princeton University.
David Keto, age 45, has served as the General Counsel of the Trust since
January, 2001. Mr. Keto joined the Trust in January 2000 as Director - New
Program Development. Prior to joining the Trust, from February 1992 to
February 1997, Mr. Keto served in several positions at the Executive Office of
Economic Affairs for Massachusetts, including General Counsel and
Undersecretary, where he led the development of the state's economic recovery
strategy in the early 1990's. He also served as Vice President for Planning
at the New England Aquarium from February 1997 to November 1999, with capital
planning responsibilities for its $120 million expansion master plan. Mr.
Keto also served as Special Counsel to the Boston Redevelopment Authority from
1989 to 1992. Prior to his work with the Boston Redevelopment Authority, Mr.
Keto was in private practice as a real estate lawyer at the law firm of
Goulston & Storrs in Boston.
9
Erica Khatchadourian, age 33, has served as Controller of the Trust since
January, 2001. Ms. Khatchadourian joined the Trust in 1993 as the Budget
Manager and in 1996 she was named the Director of Operations. Ms.
Khatchadourian was subsequently appointed Chief of Staff in 1997 until named
the Acting Director of Finance in April 2000. She has extensive experience in
general and personnel management, policy development, and accounting for
financial transactions, and is currently responsible for managing the
accounting, budget, information systems, human resource and administrative
functions of the Trust. Prior to joining the Trust, Ms. Khatchadourian was a
Senior Consultant with Price Waterhouse from 1989 to 1993, where she
participated in audits and consulting engagements with the Federal Housing
Administration, the Government National Mortgage Association, and the
Department of Housing and Urban Development. Ms. Khatchadourian earned her
Bachelor of Accountancy from The George Washington University, and she is a
Certified Public Accountant through the Commonwealth of Pennsylvania.
INFORMATION REGARDING THE TRUST
Because the Trust purchases its investments on a "net" basis, the Trust
paid no commissions during the 2000 fiscal year on its transactions.
There have been no transactions since the beginning of the Trust's last
fiscal year and there are no currently proposed transactions to which the
Trust was or is to be a party, in which the amount involved exceeds $60,000
and in which any of the following persons had or will have a material
interest: (a) any Trustee or executive officer of the Trust; (b) any member of
the immediate family of the foregoing persons; or (c) any Participant known to
the Trust to own of record or beneficially more than 5 percent of the Trust's
outstanding Units of Participation. None of the foregoing persons or
Participants has been indebted to the Trust since the beginning of its last
fiscal year in an amount in excess of $60,000 (nor has any corporation or
organization of which any of the foregoing persons is an executive officer,
partner or 10 percent beneficial owner, or any trust or other estate in which
any of the foregoing persons is a trustee or has a substantial beneficial
interest).
ORGANIZATION OF THE BOARD OF TRUSTEES
The Trust maintains four committees: the Executive Committee, the Asset
Management and Program Development Committee, the Marketing and Labor
Relations Committee, and the Legal and Audit Committee. The Executive
Committee is currently composed of Chairman Ravitch, who serves as chairman of
the Committee, Management Trustee Stanley, who serves as vice chairman of the
Committee, and Union Trustee Sweeney. The Executive Committee has all the
authority of the Board of Trustees when the Board is not in session and met 5
times during 2000. The Executive Committee also functions as a nominating
committee. In such capacity, it will consider nominees recommended by
security holders. As of the date hereof, it has not established any specific
procedures to be followed in submitting recommendations.
The Asset Management and Program Development Committee monitors the
Trust's investment practices and policies, reviews proposed changes thereto,
and considers new investment practices and policies. This Committee is
currently composed of Union Trustees Hanley and Stern, and Management Trustees
Latimer, Spear, Stanley and Sullivan. Mr. Stanley served as chairman of this
Committee, which met twice during 2000.
10
The Marketing and Labor Relations Committee oversees the marketing
policies and strategies of the Trust. This Committee is currently composed of
Union Trustees Chavez-Thompson, Flynn, Maddaloni and Monroe, and Management
Trustees Fleischer, Kardy and Spear. Mr. Fleischer served as chairman of this
Committee, which met twice during 2000.
The Legal and Audit Committee monitors the legal and accounting practices
and performance of the Trust's staff and of its counsel and independent public
accountants. This Committee is currently composed of Management Trustees
Cullerton, Latimer, Stanley and Wiegert, and Union Trustees O'Sullivan, Trumka
and Hurt. Mr. Hurt served as chairman of this Committee, which met twice
during 2000.
No committee functions as a compensation committee as such. The
Executive Committee, however, does make recommendations to the Board of
Trustees concerning compensation payable to Trustees acting in their
capacities as trustees, and compensation payable to executive officers.
The Board of Trustees met twice during the Trust's fiscal year ended
December 31, 2000, while the four committees of the Board of Trustees met a
total of 6 times. Trustees Chavez-Thompson, Cullerton, Hurt, Kardy,
Maddaloni, Monroe, O'Sullivan, Stern, Sullivan and Trumka, and former Trustees
Duvernay and Hill, attended fewer than 75 percent of the aggregate of the
total number of Board of Trustees meetings and total number of meetings of all
committees of which they were members during the 2000 fiscal year. Trustees
Chavez-Thompson, Maddaloni, Stern and Trumka attended less than 50 percent.
COMPENSATION OF TRUSTEES AND EXECUTIVE OFFICERS
During the fiscal year ended December 31, 2000, the Chairman received an
annual fee of $10,000. The Trust paid each Management Trustee who did not
waive such fee $500 per day for attendance at Board of Trustees meetings and
committee meetings. The Trust paid no fee to any Union Trustee. The
aggregate compensation paid to Trustees in the year ended December 31, 2000
was $18,000. The Trust reimbursed all Trustees for out-of-pocket expenses
incurred in attending Board of Trustees and committee meetings.
During the fiscal year ended December 31, 2000, the Trust employed
Stephen Coyle as Chief Executive Officer pursuant to an employment agreement.
During that period, Mr. Coyle's compensation from the Trust was $184,940 in
salary and cash compensation, $90,561 of deferred compensation and interest on
compensation previously deferred received in lieu of participation in the
Retirement Plan, and $1,125 in matching funds under the AFL-CIO Housing
Investment Trust 401(k) Retirement Plan (the "401(k) Plan"). Pursuant to his
employment agreement, Mr. Coyle also received health and welfare and life
insurance benefits substantially equivalent to those provided to Trust
executive officers.
May 3
11
2000 COMPENSATION TABLE
The following table sets forth the aggregate remuneration, including any
deferred, which was paid during 2000 to each executive officer of the Trust
and to all executive officers and Trustees of the Trust as a group:*
PENSION ESTIMATED TOTAL
OR RETIREMENT ANNUAL COMPENSATION
AGGREGATE BENEFITS BENEFITS FROM TRUST
COMPENSATION ACCRUED AS UPON PAID TO
NAME OF PERSON, FROM TRUST<F1> PART OF TRUST RETIREMENT DIRECTORS<F3>
POSITION ($) EXPENSES ($) <F2>($) ($)
- ------------------------------------------------------------------------------
Stephen Coyle<F4>
Chief Executive Cannot be
Officer $195,043 $91,686 determined Not applicable
Michael M. Arnold<F5>
Executive Vice
President,
Marketing, Investor
and Labor Relations $131,652 $21,712 --- Not applicable
- -----------------------
*The following individuals, each of whom was appointed an executive officer of
the Trust as of January, 2001, were not executive officers of the Trust in
2000: Eileen Fitzgerald, Chief Investment Officer - Single Family Finance;
David Keto, General Counsel; and Erica Khatchadourian, Controller.
<F1> Compensation figures represent 100% of each executive officer's
compensation for time devoted to Trust matters. Approximately 25% of Mr.
Coyle's time, 38% of Mr. Arnold's time, 42% of Ms. Kanovsky's time, 0% of Mr.
Roark's time and 0% of Mr. Thompson's time was devoted to matters relating to
the AFL-CIO Building Investment Trust ("BIT"). Pursaunt to his employment
agreement, Mr. Coyle received direct compensation from BIT Corporation in
addition to the amount set forth above.
<F2> The estimated annual benefits payable upon retirement to the executive
officers of the Trust, other than Mr. Coyle who does participate in the
Retirement Plan, are determined primarily by average final compensation and
years of service. Mr. Thompson withdrew from the Retirement Plan in 2000.
See "THE RETIREMENT PLAN".
<F3> Includes compensation from the Trust and all other registered 1940 Act
companies that have a common investment advisor with the Trust, or an
investment advisor that is an affiliated person of the Trust's investment
advisor.
<F4> Aggregate Compensation includes $9,100 of deferred compensation in 2000
under the 401(k) Plan, and excludes compensation deferred in lieu of
participation in the Retirement Plan and interest thereon. Pension or
Retirement Benefits as Part of Trust Expenses includes $1,500 of matching
funds accrued under the 401(k) Plan and $93,001 of deferred compensation in
lieu of participation in the Retirement Plan. The total amount deferred by
Mr. Coyle through December 31, 2000 in lieu of participation in the Retirement
Plan, including interest, is $508,728 and the total amount deferred under the
401(k) Plan through December 31, 2000, including interest and Trust matching,
is $44,033.
<F5> Aggregate Compensation includes $10,500 of deferred compensation in 2000
under the 401(k) Plan, and excludes amounts contributed to the Retirement Plan
on Mr. Arnold's behalf. Pension or Retirement Benefits as Part of Trust
Expenses includes $1,500 of matching funds accrued under the 401(k) Plan and
$20,782 contributed to the Retirement Plan in 2000. The total amount deferred
by Mr. Arnold as of December 31, 2000 under the 401(k) Plan, including
interest and Trust matching, is $273,861.
12
PENSION ESTIMATED TOTAL
OR RETIREMENT ANNUAL COMPENSATION
AGGREGATE BENEFITS BENEFITS FROM TRUST
COMPENSATION ACCRUED AS UPON PAID TO
NAME OF PERSON, FROM TRUST<F1> PART OF TRUST RETIREMENT DIRECTORS<F3>
POSITION ($) EXPENSES ($) <F2>($) ($)
- ------------------------------------------------------------------------------
Helen R. Kanovsky<F6>
Executive Vice
President Finance
and Administration $103,076 $19,350 --- Not applicable
Patton H. Roark,
Jr.<F7>
Executive Vice
President
Investments and
Portfolio Manager $143,745 $16,946 --- Not applicable
Harry Thompson
Former Controller
(resigned effective
April, 2000) $61,505 $6,178 --- Not applicable
Richard Ravitch,
Chairman $10,000 0 0 $10,000
Linda Chavez-
Thompson,
Union Trustee 0 0 0 0
John J. Flynn
Union Trustee 0 0 0 0
Francis X. Hanley,
Union Trustee 0 0 0 0
Edwin D. Hill
Union Trustee 0 0 0 0
- -----------------------
<F6> Aggregate Compensation includes $10,500 of deferred compensation in 2000
under the 401(k) Plan, and excludes amounts contributed to the Retirement Plan
on Ms. Kanovsky's behalf. Pension or Retirement Benefits as Part of Trust
Expenses includes $1,500 of matching funds accrued under the 401(k) Plan and
$18,480 contributed to the Retirement Plan in 2000. The total amount deferred
by Ms. Kanovsky as of December 31, 2000 under the 401(k) Plan, including
interest and Trust matching, is $8,061.
<F7> Aggregate Compensation includes $4,420 of deferred compensation in 2000
under the 401(k) Plan, and excludes amounts contributed to the Retirement Plan
on Mr. Roark's behalf. Pension or Retirement Benefits as Part of Trust
Expenses includes $1,500 of matching funds accrued under the 401(k) Plan and
$15,446 contributed to the Retirement Plan in 2000. The total amount deferred
by Mr. Roark as of December 31, 2000 under the 401(k) Plan, including interest
and Trust matching, is $27,789. Mr. Roark served as Portfolio Manager of the
Trust in 2000, and was also appointed Executive Vice President - Investments
in January, 2001.
13
PENSION ESTIMATED TOTAL
OR RETIREMENT ANNUAL COMPENSATION
AGGREGATE BENEFITS BENEFITS FROM TRUST
COMPENSATION ACCRUED AS UPON PAID TO
NAME OF PERSON, FROM TRUST<F1> PART OF TRUST RETIREMENT DIRECTORS<F3>
POSITION ($) EXPENSES ($) <F2>($) ($)
- ------------------------------------------------------------------------------
Frank Hurt,
Union Trustee 0 0 0 0
Martin J. Maddaloni,
Union Trustee 0 0 0 0
Michael E. Monroe,
Union Trustee 0 0 0 0
Terence M. O'Sullivan
Union Trustee 0 0 0 0
Andrew Stern,
Union Trustee 0 0 0 0
Edward C. Sullivan
Union Trustee 0 0 0 0
John Sweeney,
Union Trustee 0 0 0 0
Richard Trumka,
Union Trustee 0 0 0 0
John Cullerton,
Management Trustee 0 0 0 0
Terrence R. Duvernay,
Management Trustee 0 0 0 0
Alfred J. Fleischer,
Management Trustee 2,000 0 0 2,000
Walter Kardy,
Management Trustee 0 0 0 0
George Latimer,
Management Trustee 2,000 0 0 2,000
Marlyn J. Spear,
Management Trustee 1,000 0 0 1,000
Tony Stanley,
Management Trustee 3,000 0 0 3,000
Patricia F. Wiegert,
Management Trustee 0 0 0 0
All Directors and
Officers as a Group*
(26 persons) $653,021 $155,872 $0 $18,000
*In addition, the Trust has an additional 36 employees who received
compensation in excess of $60,000 from the Trust during 2000.
14
Prior to October 1, 1990, the Trust had not established or adopted any
bonus, profit sharing, pension, retirement, stock purchase or other
compensation or incentive plans for its officers and employees. Personnel
(other than the Chief Executive Officer) were provided pursuant to a Personnel
Contract between the Trust and the AFL-CIO, whereby the Trust reimbursed the
AFL-CIO for the AFL-CIO's costs of employing the personnel. While the
Personnel Contract was in effect, the personnel participated in the AFL-CIO
Deferred Compensation Plan, a defined contribution plan, and were subject to
the AFL-CIO Staff Retirement Plan ("Retirement Plan"), a defined benefit plan.
Any amounts contributed by the AFL-CIO on behalf of such personnel pursuant to
the Retirement Plan were reimbursed by the Trust pursuant to the Personnel
Contract. The Trust adopted the Retirement Plan for all of its employees
except for its Chief Executive Officer, effective as of October 1, 1990.
Also, effective October 1, 1990, the Trust adopted the 401(k) Plan described
below for all of its employees including its Chief Executive Officer (and
subsequent Chief Executive Officers).
THE RETIREMENT PLAN
Under the Retirement Plan, contributions are based on an eligible
employee's base salary. In general, rates are determined actuarially every
other year. The Retirement Plan was funded by employer contributions at rates
of approximately 12.2% of eligible employees' base salaries during the twelve
months ended December 31, 2000. During 2000, the annual base salaries of Mr.
Arnold, Ms. Kanovsky, Mr. Roark and Mr. Thompson were $173,819, $151,473,
$127,320 and $130,645, respectively.
The Retirement Plan is open to employees of the AFL-CIO and other
participating employers that are approved by the Retirement Plan's board of
trustees and that make contributions to the Retirement Plan on their behalf.
Such employees become members of the Retirement Plan on their first day of
employment that they are scheduled to work at least 1,000 hours during the
next 12 consecutive months.
The Retirement Plan provides a normal retirement pension to eligible
employees for life, beginning at age 65. The amount of this pension depends
on salary and years of credited service at retirement. Eligible employees
will receive 3.00 percent of the average of their highest three years'
earnings ("Final Average Salary") for each year of credited service up to 25
years, and 0.5 percent of their Final Average Salary of each year of credited
service over 25 years. Eligible employees must have at least five years of
service to retire and receive a monthly pension. Eligible employees generally
earn credited service toward their pension for each year that they work for a
participating employer.
An eligible employee can also receive full benefits after reaching age
55, if his or her age plus his or her years of service equals 80 or more. It
is also possible for an employee who meets the combination of 80 requirement
to retire after age 50, but in such event benefits would be reduced 4 percent
for each year or portion thereof that the employee is less than 55 years old.
Set forth below is a table showing estimated annual benefits payable upon
retirement in specified compensation and years of service classifications. As
15
of the date hereof, Mr. Arnold, Ms. Kanovsky, Mr. Roark, Ms. Fitzgerald, Mr.
Keto, Ms. Khatchadorian and have approximately 17, 4, 8, 1, 1 and 8 credited
years of service, respectively, under the Retirement Plan.
Years of Service
----------------
Final
Average Salary<F8> 15<F9> 20<F9> 25<F9> 30<F10> 35<F10>
- ------------------- ------ ------ ------ ------- -------
$ 100,000 $ 45,000 $ 60,000 $ 75,000 $ 77,500 $ 80,000
150,000 67,500 90,000 112,500 116,250 120,000
170,000 76,500 102,000 127,500 131,750 136,000
- -------------------
<F8> The Internal Revenue Code limits the permissable benefit payments
that may be paid under the Retirement Plan. Consequently, the amounts
of retirement benefits that actually may be paid to individual
employees may be significantly lower than as shown, depending on
several factors, including, but not limited to, the employee's years of
service, level of compensation, and actual year of retirement.
<F9> 3.00 percent per year up to 25 years.
<F10> 0.5 percent per year over 25 years.
THE 401(K) PLAN
Under the 401(k) Plan, an eligible employee may agree with the Trust to
set aside up to 15 percent of his or her total compensation, up to a maximum
of $10,500 in 2001. In 2001, the Trust will match dollar-for-dollar the first
$1,550 contributed. The amount set aside by an eligible employee and the
amount of the Trust's matching contribution, if any, will be deposited in a
trust account in the employee's name. Every employee of the Trust is eligible
to participate in the 401(k) Plan provided such employee has reached the age
of 21 and is not a nonresident alien.
When a participating employee terminates his or her employment, retires
or becomes disabled, the employee will be able to receive as a lump sum
payment the salary reduction amounts that were contributed to the trust
account on the employee's behalf, the additional amounts that the Trust
contributed to the trust account on the employee's behalf, plus income (less
the employee's allocated share of expenses) earned on these contributions.
If the employee continues to work for the Trust, the employee cannot
withdraw these amounts unless the employee has a financial hardship. A
financial hardship is an immediate and heavy financial need for which the
employee has no other available resources, and includes medical expenses, the
purchase of a primary residence, the payment of tuition and related
educational fees and the need to prevent eviction from, or foreclosure of the
mortgage of, the employee's primary residence. The employee will be required
to present evidence of the financial hardship and upon submission of such
evidence may be entitled to withdraw an amount, up to the balance in the
employee's account, to meet the immediate financial need.
The amount in an employee's account must be distributed to the employee
in one lump sum or in periodic installments beginning the April 1 of the year
following the year in which the employee reaches age 70 1/2. Additionally,
these amounts must be distributed within a reasonable time following the
termination
16
of the 401(k) Plan or the termination of the employee's employment. An
employee will be entitled to receive a distribution of the amounts in their
account upon the employee's attainment of age 65.
A participating employee may borrow from his or her account subject to
certain prescribed limitations.
The following table sets forth the amounts paid or distributed pursuant
to the 401(k) Plan in 2000 to the executive officers listed in the
Compensation Table above, and the amounts deferred and accrued pursuant to the
401(k) Plan for the accounts of such individuals during 2000, the distribution
or unconditional vesting of which are not subject to future events.*
Amount Paid or Amount Employer
Name of Individual Distributed ($) Deferred ($) Matching ($)
------------------ ---------------- -------------- ------------
Stephen Coyle $0 $ 9,100 $1,500
Michael M. Arnold $0 $10,500 $1,500
Helen R. Kanovsky $0 $10,500 $1,500
Patton H. Roark, Jr. $0 $ 4,420 $1,500
Harry W. Thompson $141,074** $ 2,925 $1,500
------------- ---------- --------
All executive officers
as a group (6 persons) $141,074 $37,445 $7,500
============= ========== ========
APPROVAL OF AMENDMENTS TO THE DECLARATION OF TRUST
PROPOSAL III: TO APPROVE AN AMENDMENT TO THE TRUST'S DECLARATION OF TRUST TO
CLARIFY THE AUTHORITY OF THE TRUST TO ENGAGE IN ACTIVITIES
THAT ARE DESIGNED TO GENERATE ELIGIBLE INVESTMENTS.
Under Section 3.1 of the Declaration of Trust, the Trustees have the
power to "do all things proper or desirable in order to carry out, promote, or
advance the purpose of the Trust even though such things are not specifically
mentioned in [the] Declaration of Trust." The amendment would explicitly
authorize the Trust to engage in activities that are designed to generate
potential investments in which the Trust is authorized to invest under the
Declaration of Trust, including but not limited to activities that also (x)
generate fees for the Trust or (y) benefit unions and/or union members, such
as facilitating or promoting (i) housing construction utilizing union labor,
(ii) construction of housing for union members or their families or (iii) the
availability of mortgage loans for union members.
The proposed amendment is designed to clarify the Trust's authority to
engage in activities and initiatives which may not be directly related to a
specific, existing investment opportunity, but which may create additional
potential investment opportunities for the Trust. These activities and
- -----------------------
* The following individuals, each of whom was appointed an executive officer
of the Trust as of January, 2001, were not executive officers of the Trust
in 2000: Eileen Fitzgerald, Chief Investment Officer - Single Family
Finance; David Keto, General Counsel; and Erica Khatchadourian, Controller.
** Amount represents the rollover of Mr. Thompson's account balance to another
qualified plan. 17
initiatives could include the provision by the Trust of expertise and/or
services to pension funds, mortgage banking firms or others in exchange for
fee income and could include collaboration to create and implement such
activities and also benefit unions and/or union members.
THE BOARD OF TRUSTEES RECOMMENDS THAT PARTICIPANTS VOTE "FOR" APPROVAL
OF THE PROPOSED AMENDMENT TO THE DECLARATION OF TRUST.
PROPOSAL IV: TO APPROVE AN AMENDMENT TO THE TRUST'S DECLARATION OF TRUST TO
AUTHORIZE INVESTMENTS IN CERTAIN UNITED STATES TREASURY, FANNIE
MAE, FREDDIE MAC AND FEDERAL HOME LOAN BANKS OBLIGATIONS.
Under the Declaration of Trust, the Trust is permitted to invest on a
long term basis in federally insured or guaranteed mortgage-backed securities,
obligations issued or guaranteed by, or if rated "AA" or "AAA" backed by,
Fannie Mae or Freddie Mac, as well as privately collateralized mortgage
investments that are credit-enhanced by "A-rated" entities. At the other end
of the spectrum, the Trust is authorized to invest on a temporary basis in
United States Treasury obligations and federal agency debentures, pending
investment of the Trust's assets in mortgages or construction loans.
The Board of Trustees has approved, subject to approval by the
Participants at the Meeting, an amendment to the Declaration of Trust which
will permit the Trust to invest in certain United States Treasury, Fannie Mae,
Freddie Mac and Federal Home Loans Banks obligations on a longer term basis.
Specifically, the amendment would allow the Trust to invest up to ten percent
(10%) of its assets in (i) United States Treasury obligations, (ii)
obligations issued or guaranteed by Fannie Mae, Freddie Mac or the Federal
Home Loan Banks and (iii) obligations backed by Fannie Mae, Freddie Mac or the
Federal Home Loan Banks, as long as such obligations are rated in one of the
two highest rating categories; provided, however, in each case that the
investment must have a scheduled maturity of ten (10) years or less.
This change is designed to provide the Trust with additional tools to
manage portfolio risks without increasing credit risk. The addition of
longer-term treasuries and the other obligations described above will also
increase the investment opportunities available to the Trust and permit
portfolio diversification without compromising credit risk. Finally, this
change would also permit potential investors to consider the Trust for broader
fixed-income allocations. Any resulting increase in the growth of the Trust's
assets would increase the Trust's capacity to invest in union-built housing
and economic development and loans for union members, while continuing to
provide investors with competitive risk-adjusted total returns.
THE BOARD OF TRUSTEES RECOMMENDS THAT PARTICIPANTS VOTE "FOR" APPROVAL
OF THE PROPOSED AMENDMENT TO THE DECLARATION OF TRUST.
DESIGNATION OF AUDITORS
PROPOSAL V: TO RATIFY THE SELECTION OF ARTHUR ANDERSEN LLP AS INDEPENDENT
PUBLIC ACCOUNTANTS
The Participants will be requested to ratify the Board of Trustees'
selection of Arthur Andersen LLP as the independent public accountants for the
Trust for the current fiscal year. Representatives of Arthur Andersen LLP
18
will be present at the Meeting. They will be given an opportunity to make a
statement if they desire to do so and will be available to respond to
appropriate questions.
THE BOARD OF TRUSTEES RECOMMENDS THAT PARTICIPANTS VOTE "FOR" THE
RATIFICATION OF THE SELECTION OF ARTHUR ANDERSEN LLP AS THE TRUST'S
INDEPENDENT PUBLIC ACCOUNTANT FOR FISCAL 2001.
PROPOSALS FOR 2002 ANNUAL MEETING OF PARTICIPANTS
Participants who wish to make a proposal to be included in the Trust's
proxy statement and form of proxy for the Trust's 2002 annual meeting of
Participants (expected to be held in April 2002) must cause such proposal to
be received by the Trust at its principal office not later than December 15,
2001.
OTHER MATTERS
The Trust currently has no independent investment adviser other than
Wellington Management Company LLP. Investment decisions with respect to Trust
assets other than those subject to the Investment Advisory Agreement with
Wellington Management Company are made by the Chief Executive Officer, the
Executive Vice President - Marketing, Investor and Labor Relations, the
Executive Vice President - Finance and Administration, the Executive Vice
President Investments and the Portfolio Manager of the Trust under the
supervision of the Executive Committee and, ultimately, the Board of Trustees.
Because the Chief Executive Officer, the Executive Vice President Marketing,
Investor and Labor Relations, the Executive Vice President Finance and
Administration, the Executive Vice President Investments and the Portfolio
Manager are officers of the Trust and are not engaged in the business of
providing securities investment advice to others, they are not registered as
investment advisers under the Investment Advisers Act. For the foregoing
reasons, the Participants will not be asked at the Meeting to approve any
investment advisory contract relating to the Chief Executive Officer, the
Executive Vice President Marketing, Investor and Labor Relations, the
Executive Vice President Finance and Administration, the Executive Vice
President Investments and the Portfolio Manager.
At the date of this Proxy Statement, the Trustees know of no other
matters that may come before the Meeting. If any other matter properly comes
before the Meeting, it is the intention of the persons named in the enclosed
form of Proxy to vote the Units represented by such Proxy in accordance with
their best judgment.
Participants who are unable to attend the Meeting in person are urged to
forward their Proxies without delay. A prompt response will be appreciated.
By Order of the Board of Trustees
STEPHEN COYLE
Chief Executive Officer
19